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blog itSTAMFORD, Conn.--(BUSINESS WIRE)--A recently completed revalidation of the VantageScore Solutions, LLC, scoring model shows it remains highly predictive, consistent and stable despite the economic volatility seen in the U.S. since 2007.
These results point out that despite the vast and unforeseeable changes in our economy since 2007, VantageScore remains consistent, stable and highly predictive, said VantageScore President and Chief Executive Officer Barrett Burns. It shows we don't have to change the rules.
With the recent economic turbulence, an annual revalidation of a credit risk score is critical, according to VantageScore Solutions Senior Vice President, Analytics and Product Management, Sarah Davies. VantageScore Solutions performs revalidation tests at least annually to ensure that the model remains stable even in changing economic conditions and this is the fourth test conducted.
VantageScore was developed using a June 2003 to June 2005 timeframe on a data sample of 7.5 million consumers, representing the entire U.S. demographic composition. The revalidation, based on a similar number of consumers, uses the latest consumer data from June 2006 to June 2008 randomly selected from the three national consumer reporting companies (CRC Equifax, Experian and TransUnion) databases. The large sample of anonymous consumer credit files used in the revalidation gave us the confidence that our statistics and results are trustworthy, Davies added.
Robust revalidation processes are especially crucial in periods of economic volatility. All lenders who utilize consumer credit risk scores need to assess their models efficacy on an annual basis with measurements similar to the tests provided in this paper, Burns said. Any significant shifts in score performance could require a corresponding shift in strategy.
He explained the revalidation analysis illustrates that the score remains highly predictive.
Results of the company's most recent revalidation of the VantageScore model are available in a white paper, which can be viewed at www.vantagescore.com.
ABOUT VANTAGESCORE SOLUTIONS, LLC
Stamford, Conn. based VantageScore Solutions, LLC (www.vantagescore.com) is an independently managed company that holds the intellectual property rights to VantageScore a new generic scoring model introduced in March 2006. Created by America's three major credit reporting companies (CRCs) Equifax, Experian and TransUnion VantageScores highly predictive model uses an innovative, patent-pending scoring methodology to provide lenders with a consistent interpretation of consumer credit files across all three major credit reporting companies (CRCs) and the ability to score more people.
