Operate with vigilance to lower risk

Unemployment is still high. Per capita income is still lower. The mortgage industry is still being plagued by defaults and “strategic walkaways.”

Despite these economic indicators, auto loan delinquency rates are leveling off and all industry projections are for a modest uplift in new auto sales and the re-emergence of auto leasing. Even with this cautiously optimistic news, auto lenders are being vigilant in their assessment of risk as several factors could contribute to issues in the auto arena.

Leveraging new devices of risk measurement

New methods of measuring risk, innovations in assessing a borrower’s capacity to pay, and analytics that project impacts of economic changes are all tools that were not available to auto lenders prior to the credit crisis. By leveraging these new devices, the auto industry will responsibly build its lending portfolios while controlling unwanted risk. More importantly, in today’s hyper-competitive auto financing environment, the most accurate tools for discovering the lowest risk customers will be the most valued.

As the most widely used broad-based risk scores, FICO® Scores drive the auto industry. Our solutions enable on-the-spot decisions and optimal financing terms at the point of sale to help auto lenders make accurate, reliable, and fast credit risk decisions across the customer lifecycle.

Rely on the power of the FICO® Score

That’s why all 25 of the top 25 auto finance captives and non-captives rely on the power of the FICO® Score as the industry standard measure of credit risk. With FICO’s risk control solution, you can:

• Acquire the best performing customers.
• Sharpen the approach to assigning the right product to the right customer to reduce defaults and write-offs.
• Identify pre-delinquent behaviors early, signaling a change in treatment.
• Underwrite across the credit spectrum (Super Prime, Prime, Sub-Prime).