Credit score is a metric used to determine how much an individual can afford to pay as instalments for a certain commodity/good at a given time.
The Credit score algorithm is designed in a manner such that, an individual who has a steady income, responsibilities and bills to pay, can afford to buy anything they may want to buy now (at the moment), without borrowing expensive loans, and pay slowly for the items.
How Credit Score Works
To make sure that individuals only buy goods they can afford to pay for in instalments, without straining, the credit score will track how much money is left after all expenses are deducted from your salary. After buying something, your credit score will be automatically updated to reflect your new expense (the instalments of what you just bought). This means the more you buy goods on Dreamspot, your credit score will keep on reducing and will rise once you finish paying for some of the goods.
Important Note About Downpayment
In this case the credit score does not factor the downpayment. The credit score accesses the individual's affordability of the instalments that they will need to service for a particular product. So, we assume the user can afford the downpayment outright. The downpayment will be prepaid so there is no risk of default. The risk of default exists on the instalments which we try to mitigate using a credit score tailored for each user.
