SCHAUMBURG, Ill. — Experian Automotive has launched Auto Equity Model, a consumer credit–based model designed to help automotive lenders and dealers estimate the current equity on a consumer’s open vehicle loan.
This level of insight enables users to identify and target a segment of the consumer population that may be in the market for a new vehicle or interested in refinancing their current loan, officials said. The model also helps zone in on the consumers that meet specific risk criteria.
“In today’s competitive automotive environment, it’s important for lenders and dealers to understand whether or not consumers are right-side up or upside down on their current vehicle loans,” said Melinda Zabritski, Experian’s senior director of automotive finance. “Through Auto Equity Model, we’re able to provide users with key insights, enabling them to refine their communications and target the ideal consumer, ultimately helping them to make better business decisions and improve profitability.”
Auto Equity Model leverages Experian’s consumer-credit database to estimate the dollar amount of equity a consumer has on their vehicle loan. The model was built with advanced techniques and requires only information found in a consumer’s credit profile to provide an estimated equity value.
Once the equity of the consumer’s vehicle has been determined, lenders and dealers can segment the population to meet specific criteria — for instance, showing or identifying all consumers who have more than $1,000 of equity on their vehicle. This will enable lenders and dealers to target their ideal customer better and generate prescreened offers for consumers looking to refinance or purchase a new vehicle.