The Default Risk Index presents the most accurate way to use credit scores to evaluate and compare pools of loans. This free, interactive data series is published quarterly to the VantageScore website using data from TransUnion. Rather than use credit scores to directly gauge risk profile—a practice that is common but flawed—the DRI is derived using the probability of default tables that lie beneath each credit score. In a single number, the Default Risk Index summarizes the risk profile of new originations in a way that is mathematically accurate and consistent over time.
The interactive chart below illustrates the risk profile of consumer loans originated each quarter, with higher values representing riskier loans.
Hover over to view exact values per industry. Click on the key beneath the graph to suppress or display each industry.
The third quarter marks exactly five years of data provided by the DRI. Since Q3 2013, the risk profile of each asset class has generally tightened. Student lending was the tightest category in 2017 with a record-low DRI of 72.1.
The dashboard below summarizes the total volume, risk profile, and Default Risk Index value for consumer loans originated last quarter.
|Total Originations||Probability of Default (weighted average)||Default Risk Index||DRI vs. Last Quarter||DRI vs. Same Quarter Last Year|
The risk profile of new auto loans and bankcards tightened very slightly as compared to last quarter. Student loans tightened from 90 to 72.1 while volumes more than doubled, continuing a seasonal theme that plays out each year in the third quarter. Only mortgage loans showed both a slight increase in risk and a slight increase in originations.
The interactive chart below illustrates the total volume of consumer loans originated each quarter. For bankcard loans, the values represent total credit limits originated during the quarter.
Hover over to view exact values per industry. Click on the key beneath the graph to suppress or display each industry, or click on any colored bar in the graph to view that industry by itself.
Student loan origination volumes increased dramatically in the third quarter, more than doubling its volume from the previous quarter to $49 million. Although an increase in student lending is typical in the 3rd quarter of every year, this particular 3rd quarter represented the highest quarterly volume in all five years of the DRI. All other major loan categories (auto, bankcard, mortgage), saw a slight increase in loan originations from the last quarter.
VantageScore Solutions is the company that owns the intellectual property rights to the VantageScore credit scoring models. VantageScore is jointly owned by Equifax, Experian, and TransUnion. TransUnion is a global information solutions company that serves businesses and consumers in 33 countries worldwide.
The VantageScore DRI powered by TransUnion is wholly owned by VantageScore Solutions, and the TransUnion DRI Methodologies were created by TransUnion. Any use (altered or unaltered) of the DRI or TransUnion DRI Methodologies must be plainly marked as such, and must not be misrepresented as being the original version.