Credit ratings evaluate a borrower's creditworthiness based on financial history and ability to repay debts.

They are crucial for assessing the credit quality of debt securities and impact borrowing costs and investment decisions.

Credit rating agencies consider financial history, income, debt-to-income ratio, and credit utilization in their evaluations.

Ratings range from AAA (highest) to CCC (lowest) and reflect different levels of credit risk.

Credit ratings affect borrowing costs, loan approvals, and investment decisions for borrowers and investors.