Anna White / Sophia Mitchell
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EXPERIAN ENHANCES CREDIT ASSESSMENT WITH NEW AFFORDABILITY MEASURE
Affordability Index to provide detailed insight into people’s ability to afford new credit
Nottingham, UK, 6 May 2009 - Experian®, the global information services company, today launched a new tool providing banks, mortgage companies and other lenders with further insight into the creditworthiness of their customers.
Experian’s new Affordability Index advances current credit-scoring systems by considering all areas of spending that an applicant might prioritise to help lenders quickly and more accurately judge their ability to make repayments.
By automatically comparing income and expected monthly outgoings, the Affordability Index uses Experian’s data and analytics capabilities to provide lenders with an indication of an applicant’s ability to afford future repayments, in addition to their previous credit performance.
The Affordability Index uses standard application form information, including age, income, marital status, number of dependents and employment status. Accommodation status is also used for non-mortgage applications, to allow a more accurate assessment of an applicant’s existing outgoings.
Simon Harben, Head of Bureau Analytics at Experian, comments: “Experian’s new Affordability Index provides lenders with a compelling new tool to quickly and simply assess an applicant’s ability to meet their credit commitments. A key element of responsible lending centres on understanding each applicant’s disposable income, and our latest innovation equips lenders with the ability to more accurately factor in affordability when lending to consumers.”