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    Lending Risks in Today’s Alternative Financial Services Market

Lending Risks in Today’s Alternative Financial Services Market

The Subprime Population is Broad and Diverse

Given the variability of the subprime consumer population, individuals seeking alternative financial services each carry their own unique history. But accessing a more complete view can be a challenge.
In this piece, we explore some of the challenges lenders encounter while looking to expand their consumer universe:

Concerns for mass migration online
Risks worth taking (and avoiding)
How to unmask a

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The Evolution of Credit-Risk Evaluation

Know Your Lending Future by Learning from Subprime’s Recent Past

Today, things move much faster than they did in the past.

These days, the predictive nature of the best data available in approving loans can have an immediate impact on a lender’s business. The underwriting universe has changed quite a bit throughout the past decade. The better lenders understand why that is, the more you might grasp what moves to make

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You Approved the Loan. Now Manage the Risk.

You pored over the application. You were thorough in your underwriting. Finally, you approved your customer for a loan, and all you can do is wait and hope for repayment. Sound familiar?

Now imagine the ability to monitor your customers’ credit transactions outside of your portfolio and quickly spot recent changes in their credit profile.

Clear Portfolio Alerts™, comprised of risk and retention triggers, puts you back in control of your

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Avoid Surprises With Portfolio Alerts

As a lender, have you ever wondered what your customers are doing after they sign on the dotted line? Consumer behavior in the days following a loan transaction can contribute to a lender’s success or failure. Don’t believe it? Consider this:

23 percent of consumers have a new credit inquiry within 30 days of opening a loan. An even higher number, 31 percent, will open a new loan with a

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The Missing Piece: Alternative Financial Data

The financial crisis of late 2008 triggered a sharp increase in unemployment, seeing the rate jump from 5.5 percent to a high of 10.1 percent; a rapid reduction in consumer loans offered by large banks; and a staggering devaluation of home values resulting in foreclosures and strategic defaults creating a major shift in consumer FICO® credit scores.

It is believed that 30 to 40 million consumers experienced a negative change

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Why Alternative Credit Data Is Invaluable

Alternative credit data is often used as a catchall term to describe financial data. This data is typically sourced from alternative financial service providers and account aggregation, on consumers who are not abundantly reported on mainstream credit reports.

Other insightful details may include an individual’s income and employment history, coming from applications underbanked individuals submit for other alternative financial services. The aggregation of all these peripheral particulars can help paint

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