Regulators stress the importance of model validation

Posted on May 15 2012 by

Tweet As part of its expanded guidance, the Office of the Comptroller of the Currency explicitly recommends that financial services firms utilizing predictive models and decision analytics run regular validations to gauge model efficacy. VantageScore 2.0 was recently measured against the best credit score models from each of the three largest credit reporting companies (CRCs). [...]

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Mortgage delinquency rate lowest in a decade?

Posted on May 10 2012 by

Tweet A vintage analysis comparing 60 or more days past due (DPD) delinquency performance at the one-year mark for mortgages originated between 2002 and 2010 shows that 2010 outperformed previous years, with a delinquency rate of 0.37 percent. The worst- performing vintage was 2006, with a 60 or more DPD delinquency rate of 3.84 percent [...]

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Mortgage delinquencies shift direction

Posted on Apr 26 2012 by

Tweet After increasing for the first time in nearly two years, the 30 and 60 days past due (DPD) mortgage delinquencies as a percentage of balances returned to their downward trend, with Q4 delinquency rates of 2.18 percent and 1.06 percent, respectively. This represents a decline of 3.5 percent for the 30 DPD category and [...]

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Mortgage default risk improving

Posted on Apr 23 2012 by

Tweet A recent study compiled by VantageScore Solutions found that default risk associated with mortgage originations has improved. The likelihood that a borrower will become 90 or more days past due after a mortgage has been originated was 2.5 percent in 2011, far lower than in 2009, where it hovered at 7 percent. Get your [...]

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Average bankcard balances increasing

Posted on Apr 19 2012 by

Tweet The average bankcard balance per consumer rose to $4,359 in Q1 2012 – an 8 percent increase from the previous quarter. The increase resulted primarily from balance increases to VantageScore® A and B segments, which increased 31 percent and 11 percent, respectively. Download the latest Experian industry white papers. Source: Experian-Oliver Wyman Market Intelligence [...]

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Which credit score tiers have the highest incidence of strategic default?

Posted on Apr 16 2012 by

Tweet A recent Experian study showed that strategic defaults accounted for 23 percent of all mortgage defaults 60 days past due or greater in Q4 2011. Other findings included the following: Prime and super-prime consumers (VantageScore® A and B tiers) have the highest incidence of strategic default Average outstanding mortgage balances for strategic defaulters are [...]

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Auto lenders originating longer loans

Posted on Apr 12 2012 by

Tweet With interest rates at their lowest level since 2008 and an increasingly competitive market, automotive lenders are increasing their willingness to make loans between six and seven years long: Auto loans of 73 to 84 months accounted for 14.1 percent of all new vehicle loans, up 47 percent from Q4 2010 Auto loans of [...]

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Collections in today’s world: five steps for success

Posted on Apr 09 2012 by

Tweet The economy is accelerating at a sluggish pace, and world headlines cause business leaders to swing between optimism and pessimism daily. Risk managers must look more closely and much more frequently at their customers’ behavior to stay ahead of emerging credit problems. Some tips: Use all customer information when making decisions. Combining both internal [...]

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Average credit score drops for both new and used auto loans

Posted on Apr 06 2012 by

Tweet The automotive loan market continued to improve, with lenders showing more willingness to lend outside of prime. In Q4 2011, average credit scores for new and used auto loans dropped when compared with Q4 2010. Additionally, the percentage of loans to customers with nonprime, subprime or deep-subprime credit scores increased. Average credit scores for [...]

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Loan growth a top priority for small-business lenders

Posted on Apr 04 2012 by

Tweet Despite low demand and a shrinking pool of qualified candidates, loan growth priorities continue to rank high for most small-business lenders – both for small to midsize banks and large financial institutions. Between 2006 and 2010, overall loan applications were down 5 percent where large financial institutions saw small-business loan applications rise 36.5 percent. [...]

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