Feckless Borrower Theory

The Feckless Borrower Theory posits that some borrowers, despite having the ability to repay loans, may choose not to do so due to a lack of financial discipline or responsibility. This behavior can lead to higher risks for lenders and can affect overall economic stability. The theory suggests that these borrowers may prioritize short-term gratification over long-term financial health, contributing to a cycle of debt. Understanding this theory is important for lenders when assessing creditworthiness and managing risk in the lending process.