Technology to Predict Nonperforming Loans?

Interthinx, Agoura Hills, Calif., has released the results of its latest data analysis, which it says can accurately predict which loans will be nonperforming over time.The Interthinx score predicts the likelihood of foreclosure and early payment default. In this study, Interthinx configured and evaluated performance data on over two million loan application records from its database. Through an alliance with one of the top three U.S. credit bureaus, Interthinx analyzed late payments, defaults, and foreclosure data from mortgage trade lines and compared the data with previous scores and red flags for possible mortgage fraud within loan applications. Using the Interthinx scoring system, the analysis quantitatively demonstrated that loans with a low score have a much higher level of risk than loans with a high score, the company said. For example, the risk of foreclosure in the first year is 20 times higher for loans with a score in the 0-200 range than for loans with a score in the 800-1000 range. The statistical analysis was led by Derek Stanford, director of analytics for Interthinx. The company can be found on the Web at http://www.interthinx.com.