VantageScore Solutions Posts Annual Validation Findings of Credit Scoring Model

VantageScore Solutions reported the results of its annual validation finding that VantageScore 3.0, as well as earlier VantageScore credit scoring models, continue to be effective risk management tools for lenders.

According to a media release, specifically, VantageScore 3.0 outperformed benchmark models by an average of 17 percent among consumers in the top 70 percent of the credit scoring range, which is a population that is representative of mainstream lender portfolios.

Among the other results of the annual model validation, VantageScore Solutions found that:

-Among credit scores in the mid-40 percent of the scoring range, a lender's primary risk decision zone of 600 - 770, VantageScore 3.0 outperforms benchmark models by an average of 33 percent.

-VantageScore 3.0 continues to strongly rank order consumers for all economic quadrants regardless of the extent to which regions are impacted by unemployment and home price depreciation.

-The VantageScore 3.0 model continues to deliver highly consistent credit scores across all three credit reporting companies with 90 percent of consumers receiving a credit score within 40 points, a spread that represents a doubling or halving of probability of default.

-VantageScore 1.0 and VantageScore 2.0 also continue to demonstrate a high level of accuracy and consistency and both models also remain exceptional risk management tools.

"We are extremely pleased with the results of our models' validations. Today, more than ever, lenders need assurance that the credit score model they use delivers the highest level of performance possible," said Barrett Burns, president and CEO of VantageScore Solutions. "This information is particularly important from a model governance and transparency standpoint as regulators are keen to see for themselves how a lender's risk models perform."

More information and complete details:

www.vantagescore.com

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