What does a credit score represent?

A credit score represents a borrower's creditworthiness, which essentially evaluates how likely an individual is to repay borrowed money. It is a numerical expression derived from the borrower's credit history, including factors such as payment history, the amount of debt, the length of credit history, types of credit used, and new credit inquiries. Lenders use this score to assess the risk of lending money to the borrower, making it a critical factor in loan approval processes and the terms offered, such as interest rates.

Understanding the other options provides valuable context. While the number of loans a borrower has, the interest rates offered, and the amount of debt are related to a borrower's financial situation, they do not encapsulate the overall assessment of creditworthiness. Each of these aspects contributes to the credit score but does not specifically define it. A credit score is a single comprehensive metric that synthesizes various components of a borrower's financial behavior into one evaluative measure.