Predicting Strategic Default

Strategic defaulters—consumers who can afford to make mortgage payments but proactively decide not to do so—are a top industry concern. Servicers still struggling with unprecedented levels of mortgage delinquencies and defaults are suddenly faced with another problem: customers traditionally considered “a sure thing” are becoming increasingly risky. In fact, recent FICO data shows that mortgage default risk for consumers with high FICO^® Scores now exceeds their credit card default risk.