Open Lending reinforces Lenders Protection with new alternative data attributes
On Wednesday, Open Lending Corp. released the addition of new alternative data attributes for auto finance applicants to more accurately inform the risk score generated by its Lenders Protection solution.
Open Lending highlighted that access to expanded criteria from TransUnion and LexisNexis allows Lenders Protection to analyze more robust vehicle buyer data for decisioning. These enhancements are geared to help financial institutions provide more competitive pricing to a larger applicant pool, increase volume, minimize risk and grow return on assets with the “true” capability that comes from extensive data fueling and artificial intelligence.
“We are committed to meeting the evolving needs of the market and continuously improving our services to navigate volatility, uncertainty and lingering inflation,” Open Lending chief revenue officer Matt Roe said. “As affordability issues persist, we’re excited to help financial institutions engage a wider range of deserving borrowers by offering risk-mitigated vehicle loans and maximizing their return on assets.”
Open Lending pointed out that traditional metrics sometimes fail to provide a comprehensive view of an applicant’s creditworthiness, according to Harvard Business School.
Open Lending’s Lenders Protection utilizes alternative data within its AI and machine learning decisioning engine to identify near- and non-prime applicants with low credit scores and short credit histories who are less likely to default.
“Without considering these alternative data attributes, otherwise qualified candidates face rejection or higher interest rates,” Open Lending said.
To provide greater access to vehicle ownership at a fair interest rate, Lenders Protection now offers:
—Decisioning that includes new data sources and new alternative data attributes, like the number of payments made over the past year, time elapsed since the initiation of the first auto finance installment contract, total good ACH amount, and the number of auto and non-auto inquiries over the last three years.
—Extended loan protection with a more inclusive credit score range that aligns with the decline of consumer credit scores.
“These new criteria promote greater inclusivity by increasing overall approval rates and yielding higher approval rates for car buyers with limited credit history,” said Open Lending, which added that these scorecard enhancements are now in place for all Open Lending customers.
For more information, visit www.openlending.com.