Investigate a Quarterly Increase in Loan Delinquency
AffirmData Analyst · Technical Screen
Last updated
Investigate rising delinquency through rate definitions, reporting checks, loan vintages, seasoning, portfolio mix, and within-segment deterioration.
Investigate a Quarterly Increase in Loan Delinquency
A lending business sees its delinquency rate rise in the past quarter. Explain how you would investigate the increase and distinguish measurement changes, portfolio-mix changes, loan seasoning, and deterioration within comparable borrowers or loans. Do not assume a particular delinquency threshold or portfolio dataset; state what you would request and clarify.
Hints
Hint 1
Compare loans at similar ages: A growing young portfolio and a maturing older portfolio can have different aggregate delinquency even under unchanged credit quality.
Follow-up questions
- Why can a loan-count delinquency rate and a balance-weighted rate move differently?
- What would you examine if the rise is concentrated in one origination vintage?
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