Using the most predictive credit scoring model available enhances the quality of disclosures on securitized loans, including card-loan portfolios. VantageScore has earned the trust of leading lenders, securities issuers, and ratings agencies. In 2015, both Standard & Poor’s and Kroll Bond Rating Agency rated pools of consumer loans underwritten using VantageScore credit scores without bias.
In addition, the VantageScore team maintains a regular dialogue with ratings agencies and regulators and is actively involved with the Structured Finance Industry Group (SFIG).
Nevertheless, the role of credit scores in the securitization process is too often misunderstood, by both securities issuers and investors. Failure to understand how the relationship between credit scores and probability of default (PD) shifts over time can lead to major mischaracterizations of portfolio risk. VantageScore Solutions is dedicated to correcting misperceptions and promoting best practices in this arena.