Why Lenders Should Focus on Profitability, Not First Payment Default (FPD)

Posted on 9/4/17 11:54 AM

Many non-bank lenders base their lending decisions on predictions about which applicants are likely to incur a First Payment Default (FPD)—that is, which applicants are likely to be late making their first payment on a loan. Lenders assume that by predicting FPD they will be able to predict which applicants are likely to default on the loans entirely, resulting in losses for the lender.

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Tags: lending, First Payment Default (FPD), data waterfall

 

 

 

 

 

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