National Automobile Dealers Association's centennial, former NADA President Phil Brady recalls some of the challenges that arose after the Sept. 11 terrorist attacks. NADA members contributed more than $1.6 million to a Survivors Relief Fund for the attacks victims.
A much more prosaic, but difficult, challenge also arose, Brady writes, when I received a call from NFL Commissioner Paul Tagliabue. The league had canceled all its games for the weekend following 9/11 but was intent on playing a full schedule. That meant changing the date of the 2002 Super Bowl in New Orleans to the following weekend, which would conflict with the NADA convention. Swapping the dates wouldn't be easy: The exposition was sold out, and almost 10,000 attendees had registered, many with airline tickets already in hand.
Negotiations included a meeting with Sen. John Breaux whose office was chock-full of memorabilia from NFL teams, but no model cars, Brady recalls. As for the growing media interest, it was best summed up by a Times-Picayune headline: Make Way or Pay, Phil. The date switch happened. The NFL compensated NADA and contributed $500,000 to the Survivors Relief Fund.
We have seen immense interest from lenders in reaching consumers who may not have been traditional prospects. Lenders are using alternative data to evaluate the creditworthiness of consumers with scant credit history, with auto lenders becoming especially adept at plumbing data sources, TransUnion said. A TransUnion survey of 317 lenders, conducted by Versta Research, showed how lenders are using alternative data to better assess risk and pricing for consumers with no credit report or an insufficient credit history, according to the credit bureau.Alternative data can include, among other things, property, tax and deed records, debit and checking account information and payday lending information.
The TransUnion survey participants included, among others, auto and mortgage lenders and credit card companies. The survey found that 87 percent of lenders reject some credit applicants because they cannot be scored. However, 83 percent of those using alternative data to score applicants said they have seen tangible benefits. And about two-thirds of the respondents said alternative data had helped them reach more creditworthy consumers, TransUnion said in a statement last week.Auto lenders made up about a quarter of the surveys participant pool, Mike Mondelli, TransUnions senior vice president of alternative data services, told Automotive News on Tuesday. In the auto space, the adoption rate for using alternative data is between 85 and 90 percent, he said.
Auto is really the leader because the underwriting process is robust in terms of all the data they ask for, Mondelli said. As I think about larger participants in the auto lending] space, I cannot think of one whos not doing something with alternative data.TransUnion is a player in the alternative data arena. It released its credit scoring application CreditVision Link last year. The application combines credit bureau data and alternative data sources to enable lenders to score up to 95 percent of the U.S. adult population, according to TransUnion. As many as 60 million previously unscorable consumers can be scored with CreditVision Link, TransUnion says. In just the last few months, we have seen immense interest from lenders in reaching consumers who may not have been traditional prospects, he said in a statement.
CreditVision Link shows up to 30 months of historical information, including payment history, such as dollars paid, amount paid vs. minimum due, and the amount borrowed over time.This is especially important because a traditional credit report may tell you a consumer has $5,000 in credit card debt, but one using trended data will show you whether they have built up or paid down that balance over time, Mondelli said.Mondelli hopes CreditVision Link will expand beyond the lender-dealer relationship and overlap to the dealer-consumer relationship, he said.We are trying to go down that path. We want to expose the score to consumers, he said.That could mean making the modified score available on a dealership’s rate sheet some day, he said. To date, we have not quite crossed that bridge, he said. A lot of lenders want it to be proprietary.