Interest Only Residential Mortgages

Transcription

1 White Paper Interest Only Residential Mortgages What happens when the music stops? Written by Juliet Coukham and Nick Royston May 2012 plan acquire verify manage collect

2 // 01 // White Paper // Nick Royston is a Risk Consultant at Callcredit with responsibility for Credit Risk consultancy covering all personal products across the credit lifecycle, and is focused on delivering profitable, sustainable growth while minimising losses. Nick has a number of years experience at multi-national, universal banks and has had significant exposure to industry challenges including Forbearance, Affordability and regulatory compliance. Juliet Coukham's role as Director, Retail Lending Strategy is to ensure that Callcredit s proposition to the retail lending sector is current, relevant and value adding so that we can help customers address regulatory, commercial and operational challenges now and in the future. Juliet has nearly 20 years experience as a consultant in financial services, having joined Callcredit from KPMG s retail banking advisory team in 2011.

3 // // White Paper // 02 Contents 1 Executive Summary History of interest only mortgages Size of the problem Challenges faced by lenders Solutions 4 2 Evolution of interest only mortgages s Endowment mortgages Late 1990s 2007 Securing a step on the ladder with increasing prices Present Post credit crunch 6 3 Current mortgage market Residential mortgage sales (FSA regulated) Residential mortgage stock balances (FSA regulated) 8 4 Size of the risk 9 5 Challenges faced by lenders Legacy cases currently coming to maturity Cases with a known repayment strategy Cases with no known repayment strategy & financial difficulty cases Flexible / credit line mortgages Demographic Changes 12 6 Solutions Verifying repayment strategies Assessing affordability of borrowers with no known repayment strategy Tiered Mortgages Lifetime mortgages Lenders as landlords Flexible / credit line mortgage management 16 7 Summary & Conclusion Callcredit Information Group Ltd. All rights reserved

4 // 03 // White Paper // 1. Executive Summary Interest only mortgages have historically been a large part of the UK mortgage market The use of interest only mortgages has shifted over time, and is currently associated with high risk customers Despite high volumes of interest only mortgages without repayment vehicles, the timescales involved do present lenders with an opportunity to take mitigating action 1.1 History of interest only mortgages Interest only mortgages have been a significant part of the mortgage market in the UK throughout the second half of the 20th century and into the 21st. Initially interest only mortgages were sold alongside an endowment policy designed to pay off the mortgage at maturity and leave some funds leftover. The misselling of those policies has resulted in endowments no longer being a part of new mortgage sales. More recently as house price growth accelerated, interest only mortgages were used to buy a first home, before prices were out of reach, while keeping repayments low to meet lenders affordability criteria. This strategy became unviable following the financial crisis of 2007, leading to a massive reduction in interest only mortgage sales. The economic slowdown from 2007 onwards has led to an increased number of borrowers with financial difficulties, who began to switch repayment mortgages to interest only to reduce monthly payments. These were intended to be temporary switches in repayment type, however it is not yet known how many of these borrowers will be able or willing to switch back onto their original repayment terms. 1.2 Size of the problem Between 2005 and 2009 the FSA estimates that approximately 2 million interest only mortgages were opened without having a repayment strategy in place. Of these, 1.1 million are due to mature in the decade with around 500,000 due to mature in This will place a massive burden on lenders, both operationally and financially, should these borrowers not repay and losses start to be incurred. The timescales involved do present an opportunity for lenders to take positive action to mitigate these risks, in a way which is affordable for the borrower, and without offering mortgage concessions which would be classed as forbearance Callcredit Information Group Ltd. All rights reserved

5 // // White Paper // 04 Segmentation and insight are key to identifying and communicating effectively with customers, and putting the best possible strategies in place Solutions are dependent on the severity of the borrower s difficulties, but can range from simple financial advice to complex planning schemes involving possession of the property 1.3 Challenges faced by lenders Interest only mortgages present a number of specific challenges for lenders which can be broken down into six main types: 1. Confirming the existence and value of repayment strategies, which is manual and very time consuming 2. Assessing whether a borrower currently can, or is likely in the short term to be able to, afford a repayment strategy 3. Encouraging borrowers without, but who could afford, a repayment strategy to make provision for repayment 4. Monitoring borrowers without, and currently unable to afford, a repayment strategy to identify any change in circumstance which would allow a strategy to be started 5. Managing borrowers with no potential to repay, to minimise long term losses 6. Managing balance and limits on flexible and mortgage credit line products, to ensure affordability and minimise the probability they default 1.4 Solutions Solutions available to address the issues associated with interest only mortgages are dependent on the lender s appetite for a resolution and the severity of the borrower s financial difficulty. Examples of treatment are: Encourage and assist borrowers to create or upgrade a repayment strategy part way through the term Switch borrowers into a capital and repayment mortgage part way through the term, potentially offering financial incentives to encourage borrowers to do so Create interest only lifetime mortgages, where affordability in retirement allows Transfer property ownership to settle the mortgage, with the lender or a third party becoming the landlord Actively manage open credit lines on flexible products Although some of these solutions can be used to deal with cases which have reached maturity with no repayment strategy, most impact will be achieved by managing borrowers throughout the life of the mortgage, preventing problems from building up. Essential to this is effective segmentation and insight to understand a customer s affordability position, and changes over time Callcredit Information Group Ltd. All rights reserved

6 // 05 // White Paper // 2. Evolution of interest only mortgages Interest only mortgages were historically sold alongside an endowment policy until the mis-selling scandal House price growth enabled interest only borrowers to gain equity without having to make capital repayments Interest only mortgage payments are lower than a repayment mortgage, allowing borrowers to pass lenders' affordability checks s Endowment mortgages Until the early 1990 s endowments were actively promoted by most lenders and brokers as offering a way to repay a mortgage and have a significant sum left over, for the same total monthly commitment as a repayment mortgage. The rates of return on the endowment policy were, with hindsight, significantly overstated and the risk of underperformance not made clear, leading to a large number of borrowers with a policy value which was not sufficient to clear the interest only mortgage. Throughout the early 2000 s many borrowers made compensation claims as a result of mis-selling of the policies, to cover the gap between the expected policy value and the target amount promised at point of sale. Typically these proceeds were returned to the borrower, and it was at their discretion whether the interest only mortgage was paid down. Endowment policies are no longer a feature of new mortgage sales (although some remortgages still have endowments attached), however the 20 to 25 year term on offer means there is still a significant stock of mortgages due to be repaid by endowments, which will be coming to maturity in the short term. 2.2 Late 1990's 2007 Securing a step on the ladder with increasing prices As house prices began to rise quickly in the late 1990 s and early 2000 s, potential borrowers were keen to move onto the property ladder before being priced out. To facilitate this, especially when meeting lender affordability criteria, many people elected to take interest only loans (either in full, or on a part, of the total balance) without having a repayment strategy. This constituted a two way gamble. Firstly, that house prices would continue to rise, and so the borrower s equity stake would increase, until they wanted to re-mortgage or move home. Secondly, there was a gamble that the borrowers affluence would increase in the near future, allowing a move onto a repayment mortgage, or to start investing in a repayment strategy. For those mortgages taken in the early part of this period, the house price gamble certainly paid off; however it is unknown if the borrower s affluence increased and if they subsequently began to make provision for the repayment of their mortgages. Borrowers buying at the end of the period were impacted by global economic issues with falling house prices and stricter lending criteria from lenders providing very few opportunities for refinancing, and limited opportunity for the affluence increases needed to support investment in a repayment strategy.

7 // // White Paper // 06 Changes in the mortgage market following the financial crisis led to a significant reduction in interest only mortgage sales Economic conditions led to a number of borrowers entering financial difficulties, and switching to interest only mortgages in order to reduce outgoings Present Post credit crunch Following the events of 2007 mortgage lending began to change significantly, with a shift towards better quality, usually repayment mortgages, as lenders looked to maximise the return on the capital they had to hold. The exit of a number of large lenders from the market reduced the competition for better quality customers, allowing lenders to maintain, or increase, market share while managing the risk of their portfolios. This, combined with changes in regulatory approach with more focus on affordability and income verification, led to a significant falloff in the number of new interest only mortgages and interest only remortgages. However, in this period, as economies began to slow down, with some entering recession, more people began to suffer financial difficulties. A new trend emerged where borrowers on a repayment mortgage would reduce their monthly payment by switching to interest only. Although these changes were, in theory, temporary there was very little followup undertaken by lenders to switch borrowers back onto a full repayment mortgage, and no ongoing monitoring to identify when borrowers currently in difficulty have a change of circumstance. Additionally, as these borrowers originally applied for a repayment mortgage there were very limited checks on assets which could be used as a repayment strategy at point of application, and the expectation is that, in the majority of cases, there is no repayment strategy. Borrowers who have switched from a repayment mortgage to interest only are considered, in the most recent FSA Guidelines, to be subject to forbearance activity Callcredit Information Group Ltd. All rights reserved

8 // 07 // White Paper // 3. Current mortgage market 3.1 Residential mortgage sales (FSA regulated): Mortgage sales have fallen significantly following the financial crisis in All types of mortgage sales have seen a reduction; however interest only mortgage sales have declined significantly, with a reduction of c77% of sales volumes. Mortgages 700, , , , , , , Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q1 Unknown Mix of 'Capital and Interest' Interest Only Subtotal Capital and Interest and 'Interest Only' Figure 1, Quarterly Mortgage Sales by Repayment Type Repayment vehicles can take a number of forms, which may have either formal or informal contribution schedules Where interest only mortgages have been granted, there is an expectation that the borrower has also put in place a suitable repayment strategy. Acceptable repayment strategies vary by lender, but typically range from formal investment schemes, where monthly payments are made into an investment strategy with a set maturity date (e.g. a Pension Plan with lump sum), to informal investments which are added to sporadically, and can be drawn down throughout the life of the mortgage (e.g. ISA) Repayment strategies based on informal investments present an ongoing risk, as borrowers are free to access the funds at any point, with no notification being sent to the lender.

9 // // White Paper // 08 Mortgages Historically a large number of interest only mortgages had no specified repayment vehicle 200, , , , , ,000 80,000 Despite the slowdown in 60,000 new lending, total mortgage 40,000 balances outstanding have 20,000 continued to increase Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q1 Endowment ISA Pension Unknown Figure 2, Quarterly Mortgage Sales Interest Only Repayment Vehicle An alarming feature of historic, and to some degree current, interest only sales is the proportion of mortgages opened where no repayment strategy is in known. Although this may be a reporting limitation on the part of the lender, there is significant risk associated with exotic repayment strategies which cannot be categorised easily. 3.2 Residential mortgage stock balances (FSA regulated): Despite the ongoing house price and mortgage sales slump, total Mortgage balances have continued to increase; with the proportion of each repayment type remaining broadly stable. The proportion of outstanding balances on interest only has remained constant as reduced new sales have been replaced by switchers from repayment mortgages % Stock Total Bal ( bn) 100% 1,000 90% % % % % % % % % Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q2 Other Interest only Mix of 'capital and interest' and 'interest only' Repayment (capital + interest) Total Balance Figure 3: Residential Mortgage Stocks by Repayment Type The distribution remaining unchanged illustrates the scale of challenge faced by lenders as, given the reduction in interest only Mortgage sales, it demonstrates that new mortgage flows have been replaced entirely by borrowers switching from repayment mortgages to interest only, predominantly due to financial difficulties.

10 // 09 // White Paper // 4. Size of the risk Approximately 2 million interest only mortgages were opened between 2005 and 2009 with no repayment vehicle Figures from the FSA suggest that in the period 2005 to 2009 approximately 2 million mortgage accounts were opened without a known repayment strategy. Number of Mortgages 250, , million will mature between 2024 and 2033, with roughly 500,000 of these maturing in , ,000 50, million mortgages Lenders still have a significant amount of time to take action to mitigate losses and improve borrowers 'outlook' Figure 5: Maturity Profile of account opened in without a known repayment vehicle Of these, 1.1 million accounts are due to mature in the decade , with around half maturing in This leads to two significant challenges for risks for lenders: As the majority of these cases will not mature for years lenders still have a significant amount of time to take action to mitigate losses and improve borrowers outlook. 1. The operational resource needed to handle such a significant flow of cases may be higher than lenders have available 2. Borrowers unable to repay will be looking for a property sale, either voluntary or forced, leading to a competition in the market place and downward pressure on prices

11 // // White Paper // Challenges faced by lenders Legacy cases where borrowers have had an endowment shortfall are still flowing through These cases are particularly challenging as the age of the borrower can increase the risk of reputation damage if the lender takes enforcement action Repayment vehicles are typically checked when a mortgage is opened, but not after that, resulting in a risk that the vehicle will not be maintained Identifying when customers can no longer afford a repayment vehicle is key to proactive management and pricing for risk 5.1 Legacy cases currently coming to maturity Cases currently coming to maturity with endowment policy shortfalls present a significant challenge for lenders. Not only do these cases have a history of association with complaints and compensation claims, borrowers also have a perception that they have paid their entire mortgage, and will be aggrieved at having to pay the shortfall. This significantly reduces the borrower s goodwill towards the lender which, while not being absolutely necessary for a positive outcome, is very beneficial. Cases being the subject of official complaints, especially to regulatory bodies or the courts significantly reduce opportunities to progress litigation activities. Added to this, the age of these borrowers will typically be higher, increasing the probability that they will fall into a vulnerable group, where many lenders choose to take more sympathetic actions. Although some of these borrowers, having received their red letters, will have started to make additional provision for a shortfall on their repayment strategy, many will not have, either because of affordability issues, or as a point of principle. Lenders, typically, are not aware of which borrowers have made that extra provision until the mortgage reaches maturity. 5.2 Cases with a known repayment strategy Repayment strategies are typically checked at the point of mortgage acceptance, but are not periodically checked thereafter. This presents a risk that the strategy, at point of maturity, will not be sufficient to repay the mortgage, and some type of forbearance solution will be required. This risk may materialise as a result of a number of factors, some of which are borrower based, and some economic: Borrowers with informal repayment strategies may stop adding to the capital, leaving a shortfall In extreme cases repayment strategies may be drawn down early, and not used to pay the mortgage Borrowers with investments based on variable assets (e.g. stocks & shares, property, commodities, bonds) may find that the value of that investment is significantly lower than expected Even where the assets have sufficient value, liquidating that asset may prove difficult leading to a period of nonpayment on the mortgage account The challenge for lenders is in identifying if a borrower falls into any of these categories, or is at risk of doing so, and making arrangements to ensure that the strategy is kept on track, or an alternative put in place Callcredit Information Group Ltd. All rights reserved

12 // 11 // White Paper // The focus should not be on cases hitting maturity, but throughout the interest only mortgage lifetime Flexible mortgages, if not actively managed by the lender, can lead to a borrower having the full mortgage balance outstanding at maturity, with no repayment vehicle in place Affordability checks are not normally implemented on flexible/credit line mortgage products, even when further funds are being drawn down 5.3 Cases with no known repayment strategy & financial difficulty cases With no sight of a repayment strategy, lenders are unable to quantify the true probability that the debt will go unpaid until final maturity, possibly years after the mortgage was agreed and the strategy was last checked. At this point borrowers are on the verge of retirement, with severely limited ability to repay a large sum, which results in very difficult, and potentially expensive, decisions having to be made by lenders. For this reason the focus should not be on cases hitting maturity, but throughout the interest only mortgage lifetime. Regular borrower assessment and management is required, however the identification of borrowers who should go through this process has its own challenges: 1. Assessing the fitness of any strategy which exists, including current and projected values 2. Where the strategy is unsatisfactory, identifying borrowers who can afford to maintain a repayment strategy and making arrangements for one, or switching mortgage type 3. Managing borrowers who are going to be unable to repay at maturity 5.4 Flexible / credit line mortgages Flexible mortgage and mortgage credit lines present a unique set of challenges as these borrowers are normally making payments on a repayment mortgage, and so are expected to clear the main mortgage account in full by maturity, with no specific repayment strategy needed. However the flexible/credit line mortgage can leave a significant part, or all, of the mortgage balance outstanding at maturity. The specific challenges which apply to flexible/credit line mortgages are: Affordability calculations are based on the circumstances at the time of account opening, and are not updated to reflect the higher outstanding balance, relative to the original repayment schedule, due to the flexible/credit line balance Typically, no consideration is given to repayment within the term of the mortgage, with the flexible/credit line balance only being reviewed on maturity Credit limit increase and decrease strategies are not as powerful as the equivalent strategies for Credit Cards and Current Account overdrafts, despite the significant balances Borrowers who do not fully understand the product and repayment terms, are likely to experience a repayment shock when the additional borrowing becomes due, potentially leading to financial difficulties for the borrower and negative media coverage for the lender

13 // // White Paper // 12 An ageing population increases the chances that wealth will skip a generation, or will be delayed until after the mortgage is due for repayment 5.5 Demographic Changes A feature of the aging population is that people are remaining active later into their lives. This allows grandparents to become much more involved with grandchildren, forming closer bonds than previous generations. These close bonds, combined with the relatively greater ages at which people are disposing of family homes to downsize, increases the chances that wealth will skip a generation, as grandparents choose to help grandchildren move onto the property ladder. If the generation which has now been overlooked were reliant on these funds as a way of clearing an interest only mortgage, the consequences could be severe, especially as those borrowers will typically be approaching retirement themselves. Even where wealth does not skip a generation, longer life-spans decrease the chance that an inheritance will be received before the mortgage is due for repayment Callcredit Information Group Ltd. All rights reserved

14 // 13 // White Paper // 6. Solutions Prompt identification of borrowers unlikely to be in a position to repay is key to finding an affordable resolution Manual assessment of repayment vehicles carries a significant overhead so a targeted solution, based on affordability and credit risk, gets the best return on resource investment Borrowers without a repayment vehicle require assessment to understand if one could be affordable this could be a full income and expenditure check or an automated affordability assessment The outcome of the assessment should trigger some manual actions to either create an investment based repayment vehicle, or switch mortgage type 6.1 Verifying repayment strategies Understanding if a borrower has a viable repayment strategy is vital to the assessment of risk posed by interest only mortgages. While this is relatively straightforward if the strategy is held by the Mortgage lender, in the majority of circumstances this is not the case, as no central view of a borrower investments an assets, similar to credit bureau data for credit, exists. Repayment strategies can be assessed manually if details of provider are available, and the lender has authority to request it. However, this is a very time consuming process which requires a significant amount of investment, sometimes for very little return. In addition, lenders need to be careful not to be perceived to be giving assurance or assuming responsibility for the adequacy of any repayment vehicle. A more efficient model is to use affordability and credit risk models to identify high risk borrower segments, which are unlikely to have the disposable income to support a repayment strategy, and prioritise these for full manual reviews, and contact. 6.2 Assessing affordability of borrowers with no repayment strategy Borrowers identified as having no repayment strategy can be split into two categories: 1. Borrowers who can afford to repay, but are not currently taking the steps needed to do so 2. Borrowers in financial difficulties who will be unable to afford to repay The assessment of affordability of maintaining a repayment strategy may take a number of forms, ranging from a full, detailed Income and Expenditure (I&E) check, to an automated check based on a borrower s affordability and credit risk profiles. Both of these solutions should be used to trigger appropriate contact, whether by a sales department to create a repayment strategy, or by a servicing department to encourage borrowers to switch onto a repayment basis. This should be a data driven solution, based on the risk posed by each borrower group, balancing interest income in the long term, with losses which would occur as a result of non-payment. Offering financial incentives to customers to switch to a repayment basis may be viable in some cases. Borrowers in financial difficulties throughout the life of the mortgage should be regularly reassessed to ensure that changes in circumstance are taken into account promptly to minimise financial stress when increased payments have to be made.

15 // // White Paper // 14 Tiered mortgages would strike a balance between interest only and repayment mortgages, allowing short term affordability relief while reducing the risk of underfunding In acute cases the conversion to a lifetime interest only mortgage may be required to avoid the reputational damage, and potential losses, of repossession 6.3 Tiered Mortgages As many borrowers opened interest only mortgages to satisfy affordability criteria on the assumption of future affluence, an opportunity exists to create a bespoke product to assist this. A tiered mortgage would start with very low or nil capital repayments, and step these up over the term of the loan to ensure full capital repayment by maturity. This may be structured as a formal agreement, with customer s clearing a set amount of capital every month or informally with the mortgage remaining as interest only, on the understanding that a specific amount of capital repayment will be made at some point during the year. This allows borrowers to defer the largest capital repayment to later in life, when affluence should be at a maximum, without having the payment shock associated with the full lump sum being due on maturity, and allow lenders to react promptly to affordability issues. 6.4 Lifetime mortgages Where repayment is not possible, and it is not appropriate to purse a litigation strategy through the courts, an option is a lifetime mortgage whereby the borrower remains repaying an interest only payment until house sale or death. This leaves the borrower with a permanent, significant financial cost, incurred into retirement, but provides security of tenure. The downside to this strategy is that it increases the probability of default from pensioners who have to pay a significant bill from their pension, and it transfers any house-price movement risk from the borrower to the lender, requiring a significant increase in capital. Should the borrower default, given the age of borrowers, it is very unlikely that enforcement action could be taken Callcredit Information Group Ltd. All rights reserved

16 // 15 // White Paper // In extreme cases the Lender may take the property to settle the mortgage, and allow the borrower to remain as a tenant Flexible credit lines can be challenging for lenders as the balance is variable and repayment terms are typically more relaxed 6.5 Lenders as landlords An alternative to lifetime mortgages is for Lenders to take mortgaged properties onto their books, in settlement for the mortgage, and allow the borrower to remain as a tenant with security of tenure. Although this requires lenders to absorb more risk than lifetime mortgages, the benefit is that there is potential to limit the affordability issues as renters qualify for more financial assistance in the form of housing benefit from the government. Additionally, the flexibility of renting will allow borrowers to move more easily if payments become unaffordable, allowing the asset to be liquidated sooner. This solution also transfers house price risk from the borrower to the lender, and has the same difficulties with enforcement action; however it does offer the potential for properties to be sold, with sitting tenants, to other Landlords. An obvious alternative to the lender as landlord model would be for the lender to enter an arrangement with a third party property investment partner. Re-pricing, capitalisation and term extension may be required to ensure that flexible/credit line balances are affordable

17 // // White Paper // Flexible / credit line mortgage management Flexible/credit line mortgage accounts, should be managed in the same way as a standard Current Account Overdraft, with regular reviews which assess borrower affordability and the ongoing viability of the facility. These reviews can be manual or automatic, but should look to maximise profitability by considering the three key aspects in limit setting: 1. Credit Risk Is the borrower likely to default on this facility? 2. Affordability Can the borrower afford this facility? 3. Response Is the borrower likely to utilise any facility provided? Finding the optimal point in all three criteria will ensure that losses are kept low, lenders' irresponsible lending commitments are met, and return on capital is maximised. Where a facility is deemed inappropriate for a borrower, treatments fall into two categories: Limiting Exposure Headroom is removed to limit exposure to the borrower, and stop any further deterioration Proactive Management Borrowers are proactively contacted to discuss available options, and agree a solution, with the aim to bring the balance down to an affordable level Solutions available as part of a proactive management strategy include: Arrangements The flexible/credit line balance is managed down, over a short to medium period, with regular repayments Re-Price The existing facility is re-priced to ensure long term affordability, and accelerate capital repayments to reduce long term losses Capitalisation The flexible/credit line balance is added to the main mortgage balance, and repaid over the current term Term Extension To accommodate the capitalised balance, the term is extended to maintain the monthly repayment amount 2012 Callcredit Information Group Ltd. All rights reserved

18 // 17 // White Paper // Early identification of issues is the key to achieving a positive outcome, as the remediation options remaining at maturity are not likely to be appealing to borrowers or lenders 7. Summary & Conclusion Interest only mortgages have always been For scenarios two, three and four the a challenging product for lenders, who key to a favourable outcome is early until the point of maturity have no clear identification of the shortfall, followed indication of whether the debt can, or will by a dialogue with the borrower to be, repaid. understand the circumstances and explore options available for remediation. The reasons a borrower may be unable to repay are varied, but typically fall into four Remediation options range from categories: general support and guidance, with the potential to generate sales leads, to full 1. A repayment strategy with sufficient restructures of the mortgage. In some value to clear the Mortgage cannot be extreme cases more drastic action may be liquidated needed including the granting of a lifetime 2. An underperforming repayment mortgage, or an agreement for the lender strategy doesn t have sufficient value to take on the property and act as a to clear the Mortgage Landlord. 3. A borrower who can afford to fund a repayment strategy has chosen not to 4. The borrower cannot afford to invest in a repayment strategy, or continue investing

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20 To find out more about Callcredit s Credit Solutions info@callcreditgroup.com call or visit For a specific enquiry relating to this White Paper, please contact: Nick Royston, Risk Consultant, nick.royston@callcreditgroup.com Mobile: +44 (0) Telephone: +44 (0) Juliet Coukham, Director Retail Lending Strategy, juliet.coukham@callcreditgroup.com Mobile: +44 (0) Telephone: +44 (0) Callcredit Information Group Enabling Smarter Decisions About Callcredit Information Group Callcredit Information Group has a leading edge approach to using consumer information in credit referencing, marketing services, interactive solutions and consultative analytics. This enables our clients to cost-effectively identify, engage and convert more new customers and optimise existing customer revenues. Callcredit offers intelligent solutions across the customer lifecycle as follows: Plan Acquire Verify Manage Collect 2012 Callcredit Information Group Ltd. All rights reserved