In this presentation, we explore how vehicle choice can help predict probability of default, even after controlling for financial terms and borrower credit score. Our analysis suggests that vehicle information, including residual price forecasts, lifts the ability of traditional scores to classify borrowers from most likely to default to least likely.
Takeaways- Can vehicle information help assess the creditworthiness of borrowers?
- What vehicle types are associated with better credit performance?
- How economically significant is vehicle information?
