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The August 2012 edition of the S&P/Experian Consumer Credit Default Indices showed that bankcard, first-mortgage and second-mortgage default rates hit new post recession lows. The first mortgage default rate decreased slightly, from 1.41 percent in July to 1.40 percent in August, and has been down or flat for eight consecutive months. The second-mortgage default rate fell to the lowest in its eight-plus-year history, reaching 0.72 percent. Bankcard default rates fell the most in August, from July's 3.83 percent to 3.77 percent, the lowest rate in five years. Source: Press release: Consumer Credit Default Rates Remain Near Recent Lows in August 2012.

In Experian's recent State of Credit study which analyzes credit scores in more than 100 cities, Minneapolis took the number one spot, with an average VantageScore® credit score of 787. The Midwest dominated the top 10 spots in the rankings and Wisconsin consumers continue to demonstrate their credit savvy, with four of the state's metropolitan areas making the top 10 list for the second year in a row. Top 10 highest average credit scores by city VantageScore® credit score rank City State Average VantageScore® credit score 1 Minneapolis MN 787 2 Madison WI 786 3 Wausau WI 785 4 Sioux Falls SD 784 5 Cedar Rapids IA 783 6 San Francisco CA 783 7 Green Bay WI 781 8 La Crosse WI 779 9 Boston MA 778 10 Duluth MN 777   View an interactive map and read the complete results of the State of Credit 2012 study. Source: Experian's State of Credit 2012 study VantageScore® is owned by VantageScore Solutions, LLC.

The average bankcard balance per consumer in Q2 2012 was $4,170, which is 4 percent higher when compared to the same quarter of the previous year. VantageScore A and VantageScore B tiers (super prime and prime) saw bankcard balances increase by 31 percent and 11 percent respectively, while all other VantageScore® tiers experienced annual balance decreases during the same timeframe. Listen to our recorded Webinar on consumer credit trends from the Q2 2012 Market Intelligence Reports, including bankcard trends and an in-depth look at the current state of the U.S. real estate market. Source: Experian Oliver-Wyman Market Intelligence Reports VantageScore® is owned by VantageScore Solutions, LLC.

Loans to customers in the nonprime, subprime and deep-subprime credit risk tiers accounted for more than one in four new vehicle loans in Q2 2012. With 25.41 percent of all new vehicle loans opened by customers in the nonprime, subprime and deep-subprime credit risk tiers, loans for this group were up 14 percent when compared with Q2 2011. Listen to our recent Webinar on Q2 2012 automotive credit trends Source: Experian Automotive's quarterly credit trend analysis

Mortgage delinquencies continued to reach multi-year lows with the delinquency rate for those 60 plus days past due falling to 4.68 percent in Q2 2012 compared to 5.04 percent for the same quarter last year. The decline may be the result of lenders further tightening their criteria, as the average VantageScore® credit score for consumers who opened a new mortgage trade in Q1 2012 was seven points higher when compared to the same quarter in 2011 - 878 versus 871. Sign up now for a detailed overview of consumer credit trends from the Q2 2012 Experian-Oliver Wyman Market Intelligence Reports and an in-depth look at the current state of the U.S. real estate market. Source: Experian-Oliver Wyman Market Intelligence Reports. VantageScore® is owned by VantageScore Solutions, LLC.

With mortgage interest rates at historic lows, the risk of attrition and its impact on ongoing revenue has become a paramount concern for credit unions. By implementing an automated trigger program as part of its member retention efforts, one credit union was able to improve retention rates and grow its portfolio – achieving a return on investment of 788 percent. Find out how implementing a daily triggers program can help you improve retention rates and alert you when members are looking for new credit. Source: Notification Services Case Study.

When it comes to short sales, a status of "account paid in full for less than full balance" or "settled" will still have a negative impact on a credit score because it means the debt was not paid in full as agreed. According to VantageScore® Solutions LLC, a mortgage loan settled through a short sale typically results in a change of 120 to 130 points to the VantageScore® credit score. A foreclosure generally causes a decline of 130 to 140 points. The impact of the short sale or foreclosure will vary since scores take into account the individual's overall credit history. VantageScore® is owned by VantageScore Solutions, LLC. Register now for a detailed overview of consumer credit trends from the Q2 2012 Market Intelligence Reports. Also during this event, we'll take an in-depth look at understanding the current state of the U.S. real estate market. Source: The Ask Experian team advice blog.

Total balances of automotive loan portfolios rose for all types of lending organizations in Q2 2012, reaching $682 billion, compared with $646 billion in Q2 2011. Despite this strong growth, overall loan balances still lag behind prerecession levels. In Q2 2007, outstanding loan balances reached $701 billion. The average 30 and 60 day delinquency rate fell slightly year over year across all types of lending organizations, including banks, captive finance, finance companies and credit unions. Sign up for our Sept. 6th Webinar for more information on Q2 2012 automotive credit trends. Source: Experian press release dated — Aug 8, 2012: Loan delinquencies and automotive repossessions drop in Q2, according to Experian Automotive.

The Experian/Moody's Analytics Small Business Credit Index edged up 0.9 points in Q2 2012, to 104.1 from 103.2. High-level findings from the Q2 report show that credit quality will be slow to improve in coming months, and threats to consumer confidence and spending have become more prominent. Business confidence is in line with an economy growing below potential. This factor could affect hiring through the rest of the year, postponing the emergence of a strong, consumer-led recovery. Download the entire report on Small Business Credit. Source: Experian press release—Aug 7, 2012: Small-business credit conditions slightly improve as economy shows signs of stalling

Some borrowers who are deemed subprime by traditional credit scoring criteria are actually quite creditworthy and are identified as prime or near-prime consumers when using the more inclusive VantageScore® credit score. Based on a VantageScore® Solutions' study of infrequent users of credit, 15.5 percent were found to have either prime or super-prime risk. In addition, among new entrants to the credit scene — including students who recently graduated, immigrants and recently divorced consumers — 26.5 percent were found to have either prime or super-prime risk profiles. Learn more about VantageScore® Solutions, identified as a Preferred Partner by the National Association of Federal Credit Unions (NAFCU). Source: VantageScore Solutions summer 2012 newsletter, The Score VantageScore® is owned by VantageScore Solutions, LLC.

Consumers want to hear about data breaches - Eighty five percent of respondents in a recent study say learning about the loss of their data is pertinent to them. However, when they do, 72 percent indicated that they are dissatisfied with the notification letters they receive. Companies need to take note of these findings because more than one-third of consumers who receive a notification letter contemplate ending their relationship with the company. Providing affected individuals with a membership in an identity protection product is extremely important since 58 percent of consumers consider identity protection to be favorable compensation after a breach. Learn five pitfalls to avoid in your notification letters and how Experian Data Breach Resolution can help. Source: Download the complete 2012 consumer study on data breach notification.

2011 was the 12th consecutive year that identity theft topped the list of FTC consumer complaints. Florida had the highest rate of complaints, followed by Georgia and California. Rank State Complaints per 100,000 population 1 Florida 179 2 Georgia 120 3 California 104 Learn how to detect and manage fraud activity while meeting regulatory requirements. Source: Consumer info.com infographic and FTC's Consumer Sentinel Network Data Book for January-December 2011.

The FDIC has proposed a new rule that will change the way large lenders define and calculate risk for their FDIC Deposit Insurance Assessment. The revised definitions in the proposed rule rely on "probability of default" and eliminate all references to the traditional three-digit credit score used to calculate subprime exposure -- changing the way large banks calculate their FDIC assessments. This new ruling will allow lenders to uniformly assess risk in their portfolios--regardless of the scoring models they use. View a recent webinar to hear from a panel of experts on the "The New Subprime Definition: Who is subprime now?" Source: FDIC Proposed Ruling Announcement

a.wpbutton:hover {text-decoration: none !important;} Please select from the below list of recent Experian white papers to gain more insight into topics relevant to your business needs and goals. Converting Information to Intelligence - Current Trends in Mitigating Small-Business Risk Through Analytics Download Now As former Chrysler CEO Lee Iacocca put it, “Even a correct decision is wrong when taken too late.” Portfolio managers who oversee small-business risks know this well. They realize it when they make a decision about approving or rejecting a loan request and recognize later the correct decision would have been clearer if they could have weighed additional data and used improved analytics. This white paper presents some of these latest trends affecting the small-business lending landscape. Specifically, it illuminates how companies are using the new robust data sources and analytic tools – from consortium data to rapid model customization – to maximize their interactions with small-business clients with greater accuracy. Creating Value In Challenging Times: An Innovative Approach To Basel III Compliance Download Now In this paper, we will provide an introduction to Basel III regulation and discuss some of its impact on banks and the banking system. We also will present a real business case showing how organizations turn these regulatory challenges into business opportunities by optimizing their credit strategies. Turning the Tide - Managing Troubled Portfolios Download Now The economy may be recovering and the credit picture improving, but lending institutions still find themselves coping with some troubled portfolios. Plus, they always need to be prepared to identify high-risk accounts. What they can discover is that turning around a challenged loan portfolio requires taking just a few basic steps. This white paper explores how in Arizona Federal Credit Union reversed its misfortunes to emerge from the economic crisis prosperous and with $30 million in profits, illuminating what lenders can do to manage troubled portfolios and reverse poor performance. Get To Know Your Customers: Account Linking and Advanced Customer Management For Utility Providers Download Now In this paper, we will explore the practice of customer management and key capabilities to improve effectiveness in a complex business environment. It will specifically look at opportunities within the utilities marketplace for account linking and deploying customer-level decisions to the business to help drive portfolio performance retain and grow profitability and strengthen customer relationships.   State of the U.S. Credit Markets - At Last, Signs of Real Recovery Download Now The economy’s recovery from the Great Recession may have started slowly, but it is accelerating – and it’s genuine. Economic indicators tell the story of improving business prospects. As the recovery begins to take shape, many consumers are now turning the corner with it and will present as viable candidates to grow your portfolio profitably. It’s difficult to find any solace in a recession, yet it can serve as an opportunity. 2012 will be the year for lenders to return to pre-recession strategies if they are to grow significantly. This economic rebound is real, and savvy lenders – just like those marathon runners and Tour de France bicyclists – recognize that it’s in the uphill stage of the race that the lead changes.   Home Equity Indicators with New Credit Data Methods for Improved Mortgage Risk Analytics This whitepaper describes new improvements in local housing market indicators and analytics derived from local-area credit and local real estate information. In the run up to the U.S. housing downturn and financial crisis, perhaps the greatest single risk management shortfall was poorly predicted home prices and borrower home equity. Understanding Automotive Loan Charge-off Patterns Can Help Mitigate Lender Risk Loan delinquency rates are one of the most important statistics to track in the automotive finance industry. If consumers are not repaying loans on time, it puts billions of dollars at risk. When high dollar volumes are at risk, it is a negative for everyone in the lending world, including consumers, automotive retailers and lenders themselves. While conditions have improved considerably the past few years, lenders still need to remain vigilant about where delinquencies are most likely to occur. It’s an unavoidable fact that some loans will have to be charged off. Understanding where and how these charge offs occur provides important learning for the industry. Experian Automotive has found several clear patterns that can help lenders better understand the root cause of loan delinquencies. Strategic Customer Management for Business Banking Portfolios Download Now This white paper explores business banking customer management and the benefits that can be realized from introducing a strategic approach. It will look at the features of a leading-edge approach to business banking customer management and provide practical insights on key areas.   Universe Expansion - Growth Strategies in the Evolving Consumer Market Download Now As the economy gains strength, lenders are engaging in an increasingly fierce competition to entice the best candidates to their portfolios and to grow their lending business. In waging this battle, however, many lenders are concentrating on the super-prime and prime consumer segments. Prospecting strategies currently in use often do not identify the right subpopulations within the near-prime segment. Specifically, there are prospects within the near-prime segment that exhibit low bad rates compared with the broader near-prime consumer base. It is imperative that lenders redefine their targeting/underwriting strategies to prospect and acquire in the near prime space. A variety of prospecting strategies are now available that compliment and expand on a lender’s current growth initiatives – now is the time to ensure that optimal strategies are in place and that opportunities within near-prime are not overlooked. Interested in more thought leadership? Visit our Business Resources page on  Experian.com

The pressures for both credit unions and banks, to generate returns to drive greater earnings are ever present. According to recent data released by the National Credit Union Administration, the nation's 7,019 federally-insured credit unions added 667,000 new members in the first quarter of 2012 to a record of 92.5 million. To offset these pressures, portfolio managers are aggressively expanding their policies and practices to drill more deeply and frequently into their portfolios. Increasingly, this requires the ability to trend consumer credit data, identify specific member metrics, and track those changes over time. Redefining the information your portfolios provide can by key to developing increased ROI. Learn how trended data can help you maximize your strategies and process to produce results in today's complex business environments. Source: How to drill deeper into your portfolio