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Income InsightSM helps lenders determine a borrower’s ability to pay

The Credit Card Act of 2009, which went into effect on Feb. 22, 2010, explicitly allows for the use of “empirically derived, demonstrably and statistically sound models,” such as Income InsightSM, that reasonably estimate a consumer’s income for assessing ability to pay. With this new regulation in place, multiple clients are now using Income Insight to support their compliance with the Credit Card Act.

Source: Federal Reserve System, 12 CFR Part 226, Regulation Z; Docket No. R-1370

Why is Income Insight so effective?
Clients have been selecting Income Insight over competitors’ models for four key reasons:

  1. The source used to develop the model is fully verified income data that includes all income sources, such as wages, investments, alimony and rent
  2. We strictly used attributes from the credit report and avoided any demographic data, making Income Insight fully compliant with both the Fair Credit Report Act and the Equal Credit Opportunity Act.
  3. As a tri-bureau income estimator, Income Insight saves companies significant time and money associated with purchasing and calibrating different income models
  4. Income Insight is empirically derived and statistically sound and performs 20 percent better than models built off of stated income

Source: Experian

Income Insight addresses many industry challenges
  • Many lenders do not have a process in place to request consumer-stated income. Those issuers need the ability to estimate income for loan origination.
  • Other institutions that make prescreen offers of credit to consumers need to screen for consumers who are within certain income ranges.
  • Most issuers lack the ability to get updated income after acquisition and need a means of approving line increases as part of their periodic line reviews. 
  • Collections companies and debt investors all need accurate estimates of borrowers’ incomes for valuation and recovery optimization.  

To find out more about Income Insight, contact your local Experian sales representative or call 1 888 414 1120.

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