Understanding Mortgage Payment Shock: Repayment Tradeoffs and Changing Credit Behaviours
Whistler/Blackcomb Ballroom
Our economic environment is often unpredictable and beyond the control of consumers. The sudden combination of higher cost of living and lower available income can create a change in capacity for payment obligations — a payment shock. Most recently this payment shock has impacted many consumers with variable rate mortgages causing them to potentially make trade off decisions on how they allocate disposable income across credit obligations. Additionally for some, this causes a liquidity shortage that can sometimes drive demand for more credit. Using payment data we can understand how the shock effects permeate across products. Further by understanding post-shock actions we can identify those consumers likely looking for additional credit and asses riskiness of this behaviour. In this webinar, we will unpack recent TransUnion research to provide a clearer picture of how inflation and interest rate increases impact consumers’ capacity to pay. Lenders will also gain a better understanding of exposure to payment shocks and subsequent impacts to risk and marketing selection strategies — as well as rate vulnerabilities among customers and prospects.
