In this episode:

What is a K-shaped economy?
A K-shaped economy describes a split recovery where higher-income consumers gain financial strength while lower-income groups face increasing financial stress.

Why is consumer debt rising in 2026?
Consumer debt is increasing due to higher living costs, reliance on credit cards, and uneven wage growth across income groups.

How are delinquencies impacting lenders right now?
Delinquencies—especially in auto and credit cards—are rising among subprime borrowers, making early risk detection and portfolio monitoring critical for lenders.

What should lenders watch in today’s economy?
Lenders should monitor credit use, debt-to-income ratios, and early indicators like credit card behavior to anticipate shifts in borrower risk.

How does inflation affect different income groups?
Higher-income households can typically absorb inflation, while lower-income consumers feel the impact more acutely through rising costs and limited financial flexibility.

In this episode:

What is driving the current auto market in 2026?

The auto market is being shaped by a mix of macroeconomic forces, including inflation, interest rates, tariffs, and consumer affordability challenges. At the same time, credit availability is expanding, creating a complex environment where demand persists despite financial pressure.

What is a K-shaped economy and how does it impact auto buyers?

A K-shaped economy means higher-income consumers are thriving while lower-income consumers face increasing financial strain. In the auto market, this results in strong demand for high-end vehicles while affordability challenges push many buyers toward used cars—or out of the market entirely.

Why is affordability such a major issue in the auto industry right now?

Affordability is being impacted by rising vehicle prices, higher interest rates, increased insurance costs, and ongoing inflation. These combined factors are making it harder for many consumers to purchase or finance a vehicle.

How is credit availability increasing despite consumer financial pressure?

Lenders are expanding access by offering longer loan terms, financing lower down payments, and taking on more subprime risk. While this increases access to credit, it can also introduce additional long-term financial strain for consumers.

What should dealers and lenders watch for in the second half of the year?

Key indicators include interest rate changes, inflation trends, mortgage activity, and continued consumer demand. Lower rates and improved economic conditions could unlock stronger sales.

In this episode:

Why are lenders debating moving away from the TriMerge credit report?

Some policymakers and industry groups are exploring whether using a single credit report or a bi-merge report could reduce costs and streamline the mortgage process. However, new research suggests that using fewer credit reports may introduce pricing uncertainty, increase risk, and lead to inconsistent loan qualification outcomes.

How different can credit scores be between the three credit bureaus?

According to a recent study from Andrew Davidson & Company, credit scores across bureaus can differ significantly. In the data analyzed, 27% of consumers had score differences of at least 10 points between bureaus, 14% had differences of 20 points or more, and nearly 1 in 10 had differences of 30 points or more.

How could moving away from TriMerge affect mortgage pricing?

If lenders rely on a single credit score instead of the TriMerge median, borrowers could move between pricing tiers more frequently. In some scenarios, a change of just 10–20 credit score points could alter loan pricing, potentially affecting mortgage costs by $3,000 to $5,000 or more over the life of a loan.

Economist Justin Begley of Moody’s Analytics provides our economic update.

In this episode:

Why did CSL Financial adopt VantageScore for underwriting?

CSL Financial adopted VantageScore after internal testing showed it was a stronger predictor of credit risk than legacy models. The lender found it better aligned with borrower behavior and more effective for evaluating thin and non-traditional credit files.

How does VantageScore help lenders approve more borrowers?

VantageScore uses trended credit data to evaluate whether a borrower’s financial behavior is improving or declining over time. This allows lenders to make more informed decisions than snapshot-based models, helping qualified borrowers who may have been overlooked receive approval.

What results has CSL Financial seen using VantageScore?

Since adopting VantageScore, CSL Financial has increased loan pull-through rates from approximately 8% to nearly 20%, while maintaining stable delinquency levels. The lender has also reduced credit-related costs and improved portfolio performance.

 Who benefits most from VantageScore-based underwriting?

Borrowers with thin credit files, limited credit history, or past credit challenges benefit most. This includes younger borrowers building credit and older consumers who have paid off debt and have limited active tradelines.

Why is delaying VantageScore adoption a competitive disadvantage?

Lenders who delay adoption risk higher costs, lower approval rates, and less accurate risk pricing. Early adopters like CSL Financial report both operational savings and stronger credit outcomes, making modern scoring models a competitive advantage.

In this episode:

How are lenders improving efficiency in today’s housing finance market?
Lenders are improving efficiency by digitizing and automating key steps in the mortgage process, including underwriting, income and employment verification, and data validation. Tools that reduce manual documentation help lower origination costs, shorten cycle times, and improve consistency across fluctuating market conditions.

What does resilience mean in the mortgage and housing finance ecosystem?
Resilience means a lender’s ability to perform consistently across economic cycles by managing risk, maintaining data quality, and using technology that scales with volume changes. A resilient mortgage operation is prepared for both market slowdowns and rapid growth without sacrificing loan quality or borrower experience.

Why is loan data quality critical for mortgage lenders and investors?
Loan data quality is critical because inaccurate or incomplete data increases defects, repurchase risk, and operational costs. Verifying income, employment, and assets earlier in the loan lifecycle helps lenders deliver cleaner loans, meet investor requirements, and reduce downstream risk.

How can digital income and employment verification reduce mortgage costs?
Digital income and employment verification reduce costs by eliminating manual document collection and repeated reviews. Lenders using automated, source-verified data can save hundreds to thousands of dollars per loan, reduce cycle times by several days, and significantly lower the likelihood of income-related defects.

In this episode:

What is FICO’s Mortgage Direct Licensing program?

FICO’s Mortgage Direct Licensing program allows lenders and technology providers to license FICO scores directly, rather than receiving them solely through traditional credit reporting agencies. The program is still new, and its full impact on the mortgage ecosystem has yet to be determined.

How could FICO Direct Licensing impact mortgage lenders?

Lenders are still evaluating how the program will affect their overall cost of credit each month and whether it will increase expenses across the loan lifecycle.

What risks does Direct Licensing introduce into the mortgage market?

The program introduces risk across multiple layers of the ecosystem. Credit reporting agencies may now be asked to generate scores—something they have not historically done. Lenders must assess the reliability of these scores, while the broader mortgage market and borrowers face uncertainty as scoring responsibility shifts to a more fragmented landscape.

How might borrowers be affected by these changes?

Borrowers could ultimately bear higher costs if credit expenses rise for lenders. There is also risk tied to accuracy and consistency as new parties begin generating credit scores. The long-term borrower impact remains unclear.

In this episode:

How is AI changing mortgage lending?

AI is improving customer service, underwriting, document processing, and workflow automation while keeping humans in the loop. AI helps lenders increase speed, accuracy, and empathy throughout the borrower journey.

What mortgage challenges does AI help solve?

The conversation highlights how AI reduces friction, improves clarity for borrowers, lowers operational costs, and supports more personalized experiences—especially in a highly regulated, purchase-driven market.

Why are personalization and retention so important right now?

With fewer refinance opportunities and evolving trigger legislation, lenders are prioritizing retention and relationship-based lending. AI-powered data and automation help lenders stay connected to borrowers across the full lifecycle of homeownership.

In this episode:

What is the biggest operational challenge mortgage lenders are facing right now?
Beyond rates and affordability, lenders are grappling with process inefficiencies, higher fallout rates, and rising costs. This makes automation and better data workflows essential.

How does capturing data earlier in the loan process help lenders?
Early data capture allows lenders to assess risk sooner, automate pre-approvals, reduce downstream surprises, and create more productive borrower conversations upfront.

How can automation support complex borrower profiles like self-employed income?
Automation helps identify complexity early and uses tax and income data to streamline calculations, reducing manual review and improving underwriting readiness.

How are lenders balancing innovation with cost control in a tight market?
Many are focusing on capacity management, which used technology to increase efficiency with existing staff while remaining scalable as volumes return.

What role does AI play in today’s mortgage technology stack?
AI is increasingly used to gather and prepare information, while humans remain essential for judgment, decision-making, and borrower communication.

What is “agentic AI” and why does it matter for lenders?
Agentic AI refers to systems that can take action—not just provide insights—while still operating within defined workflows and human oversight.

How do integrations and APIs improve borrower experience?
Connected systems allow data to flow in real time, trigger automations instantly, reduce back-and-forth, and give borrowers greater transparency throughout the process.

In this episode:

What is down payment assistance, and how does it help homebuyers?

Down payment assistance (DPA) includes grants, forgivable loans, and other programs that help cover down payments and closing costs. These programs can significantly reduce upfront cash requirements and make homeownership more accessible—especially for first-time buyers and middle-income households.

How many down payment assistance programs exist today?

According to Down Payment Resource’s latest Homeownership Program Index, there are more than 2,600 active homeownership assistance programs nationwide, administered by over 1,300 state, local, and nonprofit organizations.

Who qualifies for down payment assistance programs?

Eligibility varies by program, but many programs serve more than just low-income buyers. Some programs:

• Have no household income limits
• Support middle-income and “missing middle” buyers
• Apply to manufactured homes and multifamily (2–4 unit) properties
• Are available nationally or in high-cost housing markets

Why don’t more buyers use down payment assistance?

The biggest barrier isn’t funding—it’s awareness. Many buyers (and even industry professionals) don’t know these programs exist. Fragmentation, lack of standardization, and fear of complexity have historically limited adoption.

How do lenders and loan officers use Down Payment Resource?

Down Payment Resource provides tools that:

• Match borrowers and properties with eligible assistance programs
• Integrate with loan origination systems (LOS)
• Surface vetted programs automatically during the lending process
• Help lenders educate borrowers without adding operational burden

Economist Shandor Whitcher from Moody’s Analytics provides this episode’s macroeconomic update.

What are the key economic themes discussed?

·       AI adoption at the personal and industry level—and its economic impact

·       The state of inflation, growth, and consumer sentiment

·       Federal Reserve rate cuts and what they mean for credit, housing, and auto loans

·       Equity market resiliency and the role of higher-income households

·       Rising delinquencies in student loans, auto, and mortgages

·       Government shutdowns and gaps in economic data

·       The persistence—and possible evolution—of the K-shaped economy

What are the biggest risks heading into 2026?
The panel highlights labor market softening, affordability pressures, consumer reliance on credit, and uncertainty around policy, tariffs, and inflation.

What are the key takeaways for businesses and lenders?

·       Consumer financial health is increasingly uneven across income tiers

·       Credit performance signals require closer monitoring in 2026

·       AI and alternative data sources are becoming essential for economic insight

·       Adaptability and resilience will be critical as uncertainty continues

Have feedback or want to be a guest?
Contact the Equifax Advisors team at riskadvisors@equifax.com.

What is a credit score and what does it measure?

A credit score is a model applied to a specific credit file to predict the likelihood that a borrower will become delinquent. It is based only on the data included in that credit file, not the consumer’s entire financial life.

Why do credit scores differ between bureaus or scoring companies?

Scores vary because:

• Each bureau holds different underlying data.
• Scoring companies group data differently based on their models.
• The same borrower may fall into different “risk buckets” depending on how the model evaluates attributes (e.g., payment history, utilization, depth of file).

Different models may both predict risk effectively yet categorize borrowers differently.

How does adopting multiple scores (e.g., VantageScore + FICO) affect the industry?

Having multiple accepted scores encourages deeper analysis of:

• How risk is grouped and measured
• Which score is most predictive for different loan types
• How investors calibrate pricing and performance expectations

This shift pushes the industry to understand why scores differ, not just rely on a single number.

How could alternatives to tri-merge (bi-merge or single file) impact lending decisions?

Using fewer files may lower cost and streamline operations, but may reduce visibility into borrower behavior—especially for thin-file or non-traditional applicants. More data generally improves risk grouping.

How does alternative data (e.g., utilities, telco, rental history) influence credit scoring?

Alternative data helps:

• Create a more complete financial picture
• Surface strong repayment behavior not shown on traditional trade lines
• Improve risk assessments for people with non-traditional income patterns or limited credit history

However, adding new data is not enough. Lenders and investors must also understand how that data influences models.

Where can listeners learn more?

Andrew Davidson & Co: ad-co.com
Financial Lifecycle Education (FiCycle): ficycle.org

More from this episode:

Why is data so important in today’s mortgage ecosystem?

Data drives nearly every step of the mortgage process — from pre-qualification to underwriting. As Joel Rickman explains, “more data is better for the consumer,” because richer data helps more people qualify for home loans while maintaining safety and soundness in the system.

How are the credit bureaus competing and collaborating?

While they compete fiercely for business, the three bureaus share a united goal of financial inclusion. Each is innovating through differentiated data sources like rental payments, utilities, telecom data, and cash-flow insights — all designed to represent consumers more fairly.

What new data types are shaping credit files?

The credit file has never been more diverse.

• Buy Now, Pay Later (BNPL) accounts
• Rental and utility payments
• Short-term lending data
• Cash-flow management attributes
  These data sets help lenders build more accurate profiles of consumers who were previously underserved or “credit invisible.”

What role does regulation play in driving innovation?

The panelists agree that regulation and innovation can coexist. The FHFA’s adoption of modern scores like VantageScore 4.0 is one example of policy enabling progress — allowing new models that use broader data to enter the market.

What is the bi-merge debate, and why does it matter?

The bi-merge proposal — using two credit reports instead of three — is a hot topic at MBA Annual 2025.
The bureaus argue that reducing data increases risk and could harm consumers by creating gaps in credit history, leading to higher pricing or denied loans.

How are the bureaus improving consumer education?

Each company invests in tools and partnerships that help consumers understand and improve their credit:

• Equifax: education through lender partnerships
• Experian: initiatives like Boost and HomeFree USA to reach underrepresented communities
• TransUnion: free credit monitoring and app-based education to help consumers take control of their credit health

What innovations are leading the way in credit reporting?

• Equifax is leveraging The Work Number and NCTUE data to bring employment and telecom insights into credit decisions.
• Experian is pioneering cash-flow scoring and consumer-permissioned data.
• TransUnion is expanding rental trade lines and short-term lending insights to include more first-time buyers.

How should lenders prepare for VantageScore adoption in 2026?

All three bureaus encourage lenders to start testing VantageScore now. They’re offering early access to evaluate how it performs in underwriting and portfolio management before GSE guidelines take effect.

In this episode:

How are lenders improving the borrower experience?
The focus is shifting toward a complete borrower lifecycle — creating a seamless experience from application through servicing. Lenders are embracing automation in the “middleware” stages, such as underwriting and processing, to remove friction while keeping human engagement where it matters most.

How is ICE Mortgage Technology evolving its platform?
By integrating technologies from MERS, Simplifile, Ellie Mae, and Black Knight under the ICE umbrella, the company is building a truly end-to-end ecosystem that connects origination and servicing to eliminate friction, reduce costs, and enhance borrower visibility.

What role does AI play in operational efficiency?
ICE uses AI to make compliance and servicing smarter — for instance, through “Ask Reggie,” a tool that simplifies complex AllRegs compliance searches, and an AI-powered call agent that routes consumers efficiently to either automated answers or human assistance when needed.

What’s next for credit scores and data innovation?
ICE is collaborating closely with FHFA, Fannie, Freddie, and Equifax to support the rollout of new credit models responsibly. Equifax’s new crisis-period dataset — tracing behavior before, during, and after 2008 — helps the industry model risk more accurately as scoring systems evolve.

In this episode:

What is the true cost of pulling a credit report for a mortgage?

The cost of a mortgage credit report usually falls within a wide range—from around $40 up to about $240 per file, depending on factors like the number of borrowers and the products included (such as trended data or monitoring services). While some lenders cite an average cost around $155, the actual cost is often driven by how many borrowers are on the application, how many times credit is pulled, and which ancillary services are added.

Why do lenders say credit reports are “too expensive”?

Many lenders feel credit reports are expensive not because of the unit price, but because of fallout—loans that never close. When a lender pulls credit and the borrower doesn’t complete the loan, the lender usually eats that cost. Unlike appraisals, credit report fees are often not collected upfront, so unrecovered costs on fallout loans can make credit reporting feel disproportionately expensive.

How much does a credit report actually matter in the total cost of a mortgage?

In the context of a full mortgage transaction, the credit report fee is typically a small fraction of total closing costs and prepaid expenses. Even if a report costs $60–$150, that’s minimal compared to items like taxes, insurance, and appraisal fees. The real financial impact often comes from how credit information influences interest rates and approvals, not just the report fee itself.

What is a tri-merge credit report and why does it exist?

A tri-merge credit report combines data from the three nationwide credit reporting agencies—Equifax, Experian, and TransUnion—into one consolidated file. This helps:

• Reduce blind spots by capturing regional and portfolio differences between bureaus
• Give investors and GSEs (Fannie Mae, Freddie Mac) a more complete view of borrower risk
• Support underwriting models that rely on rich, multi-bureau data rather than a single view

Tri-merge helps maintain investor confidence in mortgage-backed securities by reducing data gaps and gaming risk.

In this episode:

Why is the FICO vs. VantageScore discussion so important right now?
The FHFA’s move to accept VantageScore opened the door for more competition and potential savings. While some lenders worry about cost increases, experts explain how competition is already driving innovation and pricing transparency—helping lenders better serve homebuyers.

How are Equifax and other bureaus responding to these market shifts?
Equifax, Experian, and TransUnion have each added new data benefits within existing pricing structures. At Equifax, that includes embedding income and employment data into credit reports to reduce costs and improve decision accuracy. The goal: help lenders make smarter, faster, and fairer lending decisions.

What role does Lenders One play in shaping this change?
Lenders One represents over 230 independent mortgage bankers, providing cooperative buying power and technology tools. By building its own credit-reporting platform and partnering with bureaus like Equifax, Lenders One helps members gain flexibility, lower costs, and optimize workflows.

How can lenders create efficiency in loan manufacturing?
The guests stress “buy what you need, when you need it.” That means pulling the right data at the right stage of the loan, automating income verification later in the process, and using analytics to predict fallout rates—reducing unnecessary costs while keeping accuracy high.

In this episode:

Why is credit score competition important?
For decades, the mortgage industry has relied on one scoring model. With the Federal Housing Finance Agency (FHFA) expanding options, VantageScore introduces innovation, transparency, and fairness—allowing lenders to assess creditworthiness more accurately and consumers to qualify for mortgages previously out of reach.

How will this change expand homeownership?
VantageScore’s model incorporates up to 24 months of credit history and uses alternative data sources, helping identify five million additional households that could qualify for mortgages. These consumers are often in rural or high-rental communities, meaning the change supports economic growth and financial inclusion in underserved markets.

What are the implications for lenders and the market?

·       Lenders: Gain new tools to expand their customer base without increasing risk.

·       Consumers: See more consistent and transparent scoring.

·       Market: Competitive pricing for credit data, increased innovation, and better access to affordable lending.

What’s next for mortgage credit innovation?
Lenders are encouraged to back-test their portfolios, prepare internal systems, and align with new data channels to ensure readiness as the transition accelerates in 2026.

Who are the speakers?

• Rebecca Kritzman – SVP, Experience & Partner Marketing, Equifax
• Ashley Sellers – VP, Mortgage Sales, Equifax
• Elaina McFarland – Leader, Solution Sales Experts (Credit & Verification), Equifax
• Bobby Deery – SVP, Product, Credit Division, Equifax

Together, they explore the intersection of innovation, compliance, and customer trust.

What were the major insights from Day Two?

• AI and Automation in Workflows: Lenders are adopting AI to streamline process flows and improve efficiency from application through close.
• Rising Interest in Dual Processing: Many lenders are testing Vantage Score alongside existing models to compare outcomes and assess portfolio risk.
• Soft Pull Momentum: Equifax’s soft-pull tools are helping lenders pre-qualify borrowers and protect consumers’ credit scores, especially under the new trigger law.
• Voice of the Customer: Product teams are incorporating direct lender feedback to guide new innovations such as income qualify and telco/pay-TV/utility data integrations.
• Education and Clarity: With rapid industry change — from FICO model updates to 1B vs. 3B credit reporting — customers are asking for clear, data-driven guidance.

What challenges did attendees highlight?

Widespread uncertainty dominated discussions — from pricing implications and trigger-law timing to confusion around single- vs. tri-bureau models. Customers expressed concern about misinformation and asked for help educating both lenders and consumers on what these changes truly mean.

What recommendations did Equifax leaders share?

• Stand up dual-score processing to compare outcomes between Vantage and FICO models.
• Collaborate with Equifax product teams to provide feedback that shapes future solutions.
• Audit your process flows to align products (credit, verification, income qualify) with milestones that deliver the most value.
• Prioritize education and communication — both internally and with consumers — to navigate market shifts confidently.

Who are the speakers?

• Rebecca Kritzman – SVP, Experience & Partner Marketing, Equifax
• Emmaline Aliff – Leader, Equifax Advisors
• Tom Ciulla – SVP, Enterprise Alliances, Equifax
• Chris Mock – VP Mortgage Verification Services, Equifax

Together, they bring perspectives from marketing, data strategy, sales, and economic analysis.

What are the major takeaways from MBA Annual25 Day One?

• Optimism and Energy: Attendees are feeling energized by collaboration and the potential for industry innovation.
• Tri-Merge vs. Single-Bureau Debate: Executives discussed the implications of recent announcements on credit models and what they mean for lenders and low-to-moderate-income borrowers.
• Data-Driven Decisions: The Equifax team emphasized how expanded data, tri-bureau perspectives, and new credit indicators help lenders make more responsible, inclusive lending decisions.
• Balancing Innovation and Safety: Many sessions focused on adopting new technologies without compromising trust or consumer protection.
• Industry Alignment: Across meetings, Equifax was recognized for leadership in data innovation and responsible lending.

Why is innovation such a key theme this year?
Rapid regulatory shifts, market uncertainty, and announcements about credit scoring models have pushed lenders to explore new data sources, smarter automation, and more personalized credit insights. The conversation centered on how innovation can serve both lenders and consumers — improving efficiency while promoting fair access to credit.

What challenges did the speakers highlight?
The group noted miscommunication and uncertainty around policy changes and data use. They stressed the need for industry education, transparent communication, and data-backed decision-making to reduce fear and misinformation.

What gives them hope about the mortgage market?
Every guest emphasized a shared sense of responsibility and care within the industry — a collective commitment to helping people live their financial best through responsible, data-driven lending.

Economist Justin Begley of Moody’s Analytics delivers our macroeconomic update.

In this episode:

What is the Market Pulse Index?

The Market Pulse Index is a new measure developed by Equifax Advisors that combines multiple financial dimensions—credit performance, income, debt, assets, and affluence—into one holistic view of consumer and market health. It helps lenders and policymakers understand economic conditions beyond single metrics like CPI or GDP.

Why is the Market Pulse Index important right now?

With the U.S. government shutdown delaying key data releases, traditional indicators such as the jobs report and GDP updates are unavailable. The Market Pulse Index fills this gap by integrating real-time, multi-source data to reveal trends in affordability, financial durability, and consumer well-being.

How does the Market Pulse Index differ from other metrics like CPI or GDP?

Unlike single-dimension indicators, the Market Pulse Index combines hard data (credit, income, assets) and soft data (consumer sentiment) to provide a multi-layered view of economic conditions. It can reveal disparities across populations, regions, and credit tiers—helping decision-makers identify who’s thriving and who’s struggling.

What is the K-shaped economy and how does it relate?

The K-shaped economy describes uneven recovery patterns—where high-income consumers see wealth gains while lower-income groups face rising debt and affordability challenges. The Market Pulse Index captures these differences, offering a clearer picture of financial resilience across demographic groups.

How can lenders and businesses use the Market Pulse Index?

Organizations can use the Market Pulse Index to:

• Track aggregate consumer health across income, geography, and age groups
• Identify emerging credit risks and opportunities
• Adjust lending and pricing strategies based on holistic insights
• Improve risk management and marketing segmentation

If you have questions or suggestions for future podcasts, please reach out to riskadvisors@equifax.com.

Economist Justin Begley of Moody’s Analytics delivers our macroeconomic update.

Economist Shandor Whitcher of Moody’s Analytics delivers our macroeconomic update.

What is this episode about?
This episode of the Market Pulse Podcast brings together Equifax Advisors Emmaline Aliff, Tom O’Neill, Jesse Hardin, Maria Urtubey, and Dave Sojka to share what they are hearing in one-on-one customer advisory sessions.

What are lenders most concerned about in 2025?
Advisors discuss the resumption of student loan payments, the ripple effects of tariffs, shifts in auto lending, and how these issues vary across industries such as credit unions, banks, and fintechs.

How are customers using Equifax advisory sessions?
Advisory conversations allow lenders to bring their own portfolio challenges to the table and get tailored insights—turning market data into actionable strategies.

Economist Justin Begley of Moody’s Analytics delivers our macroeconomic update.

In this episode:

·      Post-COVID wealth trends and overall asset growth

·      The shrinking mass affluent segment and rise of the “barbell effect”

·      Disparities in wealth distribution across income tiers

·      Differences in financial outcomes by age group (Gen Z, Gen X, retirees)

·      Geographic variations in wealth concentration

·      Stock market and investments as primary drivers of wealth growth

·      Declining deposit levels and implications for banks

·      K-shaped economic and credit recovery

·      Strategic marketing approaches for targeting affluent households

·      Outlook for deposits and investments through 2025–2026

Resources:

• CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Resources:

• CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Resources:

•  CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Resources:

•  CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Resources:

•  CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

The Federal Reserve's rate cuts aimed to cool inflation and support affordability, yet high borrowing costs persisted, impacting home purchases and refinances. The labor market showed resilience, with steady job creation, but challenges like rising unemployment and slower hiring added complexity. Consumer behaviors reflected cautious optimism as high credit card rates and rising debt levels strained budgets.

The panel revisits their 2024 predictions and look ahead to 2025’s economic landscape.

Resources:

•  CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

• Overview of recent Fed rate cut (50 basis points)
• Impact of the rate cut on the U.S. economy
• Consumer sentiment and its effect on household spending
• Effects of rate cuts on household debt, budgeting, and savings
• Influence on the housing market (mortgages, refinancing, HELOCs)
• Impact of rate cuts on credit card users and auto loans
• Lending institutions’ response to rate cuts (funding, credit, and lending standards)
• Deposits and savings rates amidst a changing interest rate environment
• U.S. government's economic challenges (federal deficit and budget)
• Global economic factors, including conflicts and their effects on the U.S. market
• Outlook for the U.S. financial system

In this episode:

·       Rising Insurance Premiums: Post-pandemic premium surge and reasons behind it

·       Economic and Social Inflation: Impact on insurance costs from inflation and litigation

·       Consumer Impact and Behavior: Response to higher premiums, increased shopping, uninsured drivers

·       Insurer Responses: Managing affordability with staffing, ad spend cuts, communication

·       Customer Trust and Satisfaction: Effect of rising premiums on trust and relationships

·       Popularity and benefits of usage-based insurance policies

·       Predictions and strategies for managing insurance affordability

Resources:

•  CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode: 

• What small business indices data shows about lending activity and defaults
• Factors small and commercial businesses should be watching in current economic climate
• State and industry level trends that stand out
• How commercial businesses can incorporate small business indices into their decision making

 Connect with Sarah Briscoe at sarah.briscoe@equifax.com

Resources:

• CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

• Deep dive into credit trends
• Credit scores and loan performance
• Utilization and delinquencies
• Insights on delinquent loans and consumer profiles
• Pandemic impact and consumer spending
• Student loan debt and consumer behavior
• Strategies: Adapting credit models post-pandemic
• Innovative approaches in credit risk management

In this episode:

• Growing concerns and types of fraud in the automotive industry
• The transition of the automotive industry into a more digital realm
• Analysis of current economic factors influencing the auto market
• Predictions on short-term consumer behaviors and market trends
• EV market trends and future prospects

Resources:

•  CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts, and analysis.
• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions.
• Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      Overview of VantageScore

·      Factors contributing to rising delinquencies

·      Two different consumer segments

·      Impact of stimulus on credit scores

·      Credit decisioning strategies

·      Incorporating AI into decision making

·      Opportunities of differentiated data

Jeff hosts the SCORE podcast where he interviews the new leaders shaping the credit industry, like journalists, academics, and researchers. So be sure to check that out.

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      Role of the Equifax chief risk officer

·      The focus on delinquencies

·      Role of risk manager for cards

·      Implementing policies to manage credit risk for credit card issuers

·      Role of risk analyst

·      How economic challenges like a rise in delinquencies impact risk analysis

·      Role of chief collection officer

·      How the changing economic landscape impacts the chief collection officer

·      Biggest challenges for chief risk officer

·      Go-to competitive advantages of credit risk manager

·      Fulfilling the business goals and targets of an organization

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      Consumer holiday spending

·      Consumer spending spikes

·      Consumer Price Index and inflation

·      Auto market

·      New home and rent affordability

·      Insurance affordability

·      Consumer health by generation

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

• Revisiting economic trends
• Transitory inflation
• Consumer spending
• Labor Market
• Auto Industry
• Banking and Lending
• BNPL and regulation
• Credit Unions
• Themes for 2024

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

• Connections between consumer stress and sales
• Economic uncertainties and transition to online shopping 
• Highlights of the holiday spending outlook
• Consumer financial options, including BNPL
• Considering the international economic outlook

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      Deep dive into economic challenges

·      Student loan payment moratorium end

·      Long-term interest rates surge

·      Interest rates and economic outlook

·      Unpacking the 5% treasury yield

·      Economic headwinds and GDP impact

·      Resilience amidst challenges

·      Bright spots in the economy

·      Recommendations for businesses and consumers

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      Economists and consumers have diverging views on the economy

·      Specific consumer stresses

·      Statistics on consumer stresses

·      What data can reveal about consumer stresses

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      Economic factors contributing to consumer stress

·      Why consumer stress is nuanced

·      Do news headlines add stress to consumers?

·      What are economists forecasting for the rest of the year and 2024?

·      How should lenders distinguish the impacts on different consumers?

RESOURCES:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

In today’s episode:

·      How Maricopa is trying to reduce wage inequality for minority groups

·      Steps Maricopa is taking to address college affordability concerns

·      Anticipating and navigating government regulation

·      Driving efficiency and accuracy in reporting for accreditation, national education data collection programs and governing board reports

·      Effects of student loan repayments on proving your ROI

RESOURCES:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

In this episode:

·      Understanding the value of a customer

·      Ensuring your account management strategy compliments your adjudication strategy

·      Frequency of account monitoring to minimize risk

·      Is the cost and effort worth it?

·      Should you consider alternative data?

·      How lenders develop new strategies for unique situations, such as the student debt repayments

Resources:

Fintech Solutions: Discover how our rich data, predictive analytics and cloud-native technologies can help fintechs successfully target and acquire more customers, mitigate fraud and make better business decisions.

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      How the repayments will impact the financial industry

·      Will the additional monthly payment cause delinquencies to rise in other loan products

·      How clients can assess risk in their loan book

·      Strategies for addressing risk

Resources:

Fintech Solutions: Discover how our rich data, predictive analytics and cloud-native technologies can help fintechs successfully target and acquire more customers, mitigate fraud and make better business decisions.

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·      The biggest challenges facing SoFi this year

·      How the restart of student loan refinancing may impact the fintech industry

·      What’s in SoFi’s playbook for economic downturns

·      Where SoFi wants to leverage generative AI in its business

·      What the fintech industry is doing differently from traditional banks

·      How fintechs and other industries are battling the rising tide of fraud

Resources:

Fintech Solutions: Discover how our rich data, predictive analytics and cloud-native technologies can help fintechs successfully target and acquire more customers, mitigate fraud and make better business decisions.

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Topics include:

• Update on the debt ceiling crisis
• Possible long-term effects of crisis
• Moody's Analytics outlook for the second half of 2023
• How the financial industry can prepare
• Reasons for cautious optimism

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

-        A short economic update from David Fieldhouse, Director of Consumer Credit Analytics at Moody’s Analytics

-        How economic uncertainty is impacting consumer habits

-        How financial institutions are adjusting their marketing strategies

-        Where are the opportunities for marketing financial products

-        Insights on credit card marketing and mortgages

-        Strategies the financial industry is using to attract Gen Z

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

In this episode:

·       In light of credit tightening, why lenders are concerned about their policies right now

·       How credit tightening is impacting consumers, and what we may see if the credit tightening continues

·       Areas of opportunity for lenders

·       Recommendations for how lenders can minimize their risk

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

• What are the latest trends in credit union operations and financial performance?  
• How are credit unions different from banks with regards to the types of investment they are allowed to make?
• What, if any, are the implications to credit unions related to the recent bank failures?

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

·      What is a deposit growth strategy?

·      How can it reduce a financial institution’s risk?

·      What role does data play in an effective deposit growth strategy?

RESOURCES:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Highlights:

:30 – Economic update from David Fieldhouse, director of Consumer Credit Analytics at Moody’s Analytics

3:35 – Jonathan Smoke reveals what the auto market has in common with Michael Jackson’s hit Beat It from the 1980’s

6:17 – Why this year’s outlook is “not bullish”

10:18 – U.S. supply chain and production is performing better than other regions in the world

12:10 – Biggest challenge for lenders and dealers this year

14:41 – How affordability is affecting the auto market

19:10 - Implications for subprime consumers

23:40 - Will the emphasis on online shopping continue?

27:15 - The EV market is the positive part of the market

32:30 - What is the industry missing or not thinking about that they should?

Resources:

Learn more about Cox Automotive and check out Jonathan Smoke's column, Smoke on Cars

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

This podcast episode was a continuation of the November webinar, Market Pulse: Impact of Global Economic Headwinds on the U.S. Economy.  Access the presentation slides. These insights came from our Global Credit Trends.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and send us your questions at marketpulsepodcast@equifax.com

Highlights:

1:00 - Trends in consumer and commercial lending in 2023

2:22 – Delinquencies will rise with slowing economy

3:50 – What impact will new Congressional make-up affect economy?

5:00 – National debt ceiling needs to be raised

6:30 – How to balance risk and opportunity in lending going forward

8:15 – Trade line volume and debt consolidation after holidays

9:29 – Small business applications remain high

10:45 – What aren’t lenders focusing on that they should be

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Improve the targeting of new business accounts with B2B Connect.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

0:50 – Analysis of labor market in 2023

2:38 – Potential shocks to the labor market

4:55 – Recognizing the variety in labor market; using data to find opportunities

6:45 – Smart portfolio management; do job losses or income matter more?

9:00 – Lenders should consider long-term labor market

11:24 – How do lenders forecast long-term trends in labor market

Resources:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecasts and analysis.

Reduce Risk and grow your portfolio with Customer Portfolio Review.

Register for Market Pulse webinars to get relevant economic and credit insights to help your 

business make more confident decisions.

Learn more about our Market Pulse podcast, and contact us at marketpulsepodcast@equifax.com

Episode Highlights:

1:30 – Moody’s Analytics perspective on whether there will be a recession in 2023

2:45 – Consumer spending patterns 

7:45 – How can lenders adjust their practices to find opportunities

9:39 – Lenders should also think long-term like demographic shifts

RESOURCES:

CreditForecast.com is a joint venture between Equifax and Moody’s Analytics. Get actionable consumer credit, economic and demographic data, forecast and analysis. 

Global Credit Trends: Explore global credit and financial data insights. Delivering trends in credit risk, debt, utilization and delinquencies from around the world.

Visit our Market Pulse webpage to:

• Register for Market Pulse webinars to get relevant economic and credit insights to help your business make more confident decisions: https://www.equifax.com/business/trends-insights/marketpulse/
• Sign up for our free Credit Trends reports for insight on current consumer credit behaviors, trends, and performance across the U.S.
• Learn more about the Market Pulse podcast.
• Contact us at marketpulsepodcast@equifax.com 

 
Don't miss these highlights:

1:00 – About Truepic

2:16 – How Equifax partners with Truepic to streamline insurance industry’s underwriting and claim processes

4:25 –Truepic Vision use cases in industries that rely on digital photos and video

7:50 – The science behind the Truepic Vision technology software

11:45 – The configurability and flexibility of the platform

15:00 – Quantifying savings from using Truepic Vision

16:54 – How Truepic can help insurance companies reach economic, social and governance targets

19:30 – How Truepic can help verify warranty providers, especially in auto sales

21:05 – Ubiquity of digital tools and importance of authenticity to undergird digital transformations

Find out more at: equifax.com/business/product/truepic-vision/ 

Jump ahead to these topics:

2:30 – About Atul Patel and Orbee

5:50 – What can the auto industry do with today’s updated personalization capabilities?

14:09 – The auto industry’s customer data is siloed, and that is impeding its marketing relevancy

16:05 – How the consumer can benefit from contextual personalization

18:16 – How Atul reconciles being a MarTech and ad tech thought leader as well as a privacy advocate

23:42 – Technology has evolved to allow dealers to segment smaller groups and market to them 

For more information about Market Pulse: https://www.equifax.com/business/trends-insights/marketpulse/

Connect with Atul Patel on LinkedIn: https://www.linkedin.com/in/atulpatelx/ or at Orbee.com.

Show Notes:

As consumers feel the squeeze from inflation on their wallet, is the time ripe for leveraging consumer-permissioned data to unlock credit for certain populations? Jeff Hollander at Envestnet | Yodlee discusses the benefits of this aggregated data, while David Fieldhouse at Moody‘s Analytics discusses the latest overall economic and credit trends.

Jump ahead to these topics:

1:40 – Latest economic insights & consumer credit trends from Moody‘s Analytics

6:06 – Certain populations and score bands experiencing higher rates of delinquencies

8:12 – How will the student loan population be affected when deferments end?

9:50 – What is Envestnet | Yodlee? And how can it help open access to credit?

12:05 – Has pandemic accelerated use of consumer-permissioned data?

13:50 – How do we get more consumers to opt-in to this data?

15:30 – Envestnet | Yodlee: What is the future of consumer-permissioned data?

16:50 – Moody‘s Analytics position on consumer-permissioned data

Learn more about the Market Pulse podcast and webinar series.
CreditForecast.com
Cashflow Insights

Skip ahead to these topics:

1:02 – About Wayne’s background

1:40 – What inspired the new white paper, The Golden Years: Planning for the Changing Face of the U.S.

2:46 – The main findings about key populations shifts

5:40 – Is a decline in GDP inevitable?

8:35 – Will record number of new business formations offset slower growth

10:00 – Our spending habits are predictable; adjust your marketing

13:00 – Segmentation is back and is necessary for your business

15:00 – Boomers will no longer be the biggest spenders, but still relevant

17:25 – Biggest surprise of research: businesses’ focus on millennials

18:50 – Predicted growth patterns are not destiny if we change rules

20:30 – Anticipate shrinking market by growing new segments

Read more insights at visa.com/economicinsights

Jump ahead to these highlights:

1:50  - Economic update from Moody’s Analytics

4:06 - What is the BNPL tradeline, and why is it having such a big impact this holiday season?

6:00 - Who is using BNPL loans, and what are their motives for using them?

9:50 - How BNPL is more about the shopping experience

11:10 - Outlook for growth in BNPL

14:20 - How does the financial industry manage risk? What does this mean for the traditional credit file?

To access the latest consumer credit and small business insights, contact your Equifax account executive today, or visit us online at equifax.com/business. You might also enjoy checking out Economy.com by Moody’s Analytics for the latest economic updates.

******We want to hear from you! What did you think of this episode? What would you like to hear our experts share in the future? Email us: marketpulsepodcast@equifax.com. 

RESOURCES mentioned in this podcast:

• Do you have the economic and consumer credit performance data you need?  With CreditForecast.com -- a joint product created by Equifax and Moody’s Analytics -- you can access data, forecasts, scenarios, analyses and more from analysts you trust. https://www.creditforecast.com
• Register for upcoming Market Pulse webinars from Equifax, plus access previous webinars and presentations.
• Download our latest Credit Trends reports. 

This portion of the transcript is edited for brevity. Listen to the full podcast for more great insights.

Katherine:

It feels like we're starting to see the path forward to the normal-normal, and not just the pent up demand normal. So that's good to hear. We're talking a lot about that top “leg” of the K and that path forward, but there's that opposite path as well -- a whole different population of consumers that are not in that position. So I'd love to hear from you a little bit more of what you're seeing on the credit side for that divergent path in the K.

David:

The population that I like to study when I'm thinking about the other half of the K, the individuals who maybe are not as well positioned right now, I usually look at the renter population. That's usually the group that I focus on. We estimate there are about 5.6 million delinquent renters in the United States. So this is about 13% of all renters. To put that in context, our best estimate is that about 6% of renters are typically delinquent. In terms of severity amongst the delinquent population, we're expecting that they're about three months behind in payments when you put together rent and utility, and those typical payments that need to be made. Things have actually improved. 

So, we were talking earlier this year about a potential rental eviction crisis. Things are on the right path to staying away from that true crisis. What we need to do is have rental assistance from the government actually get distributed. There's been a lot of administrative hurdles as money passes from state to local governments to finally make it to the renters. But there are definitely 5 million renters out there right now that are probably not feeling as optimistic about the economic situations. And we need to be cognizant of this group.

Katherine:

And this is where we can dig in a little bit more to your research, Emre. I would love to hear from your perspective an overview of the unscoreable and invisible populations that you've been studying and what VantageScore was seeking to better understand with that initiative.

Emre:

You're absolutely right that there's actually a significant focus on the topic of credit invisibles right now. Lack of a credit score certainly hinders that consumer's ability to access mainstream credit products. And that contributes to financial inequities and the growing wealth gap for historically disadvantaged consumers. 

As you mentioned at the beginning of the podcast, a foundational objective for VantageScore      has always been centered around financial inclusion. Innovations have been aimed at really trying to increase the population of scoreable consumers and to provide a fair and accurate representation of credit risks so that they can have a fair shot at gaining access to mainstream credit products. 

Now coming to our research, CFPB performed an analysis back in 2015, which stated that there were roughly about 45 million consumers who were credit invisible. But we know that not all of these consumers are credit invisible, really. They're invisible only to some of the legacy systems and models that have not been really updated for quite some time. 

In our research, we aim to provide an estimate of the total population of consumers 18 years or older, who are scoreable by VantageScore. And we looked at the 2019 census numbers, and we note that there were about 48 million consumers who are not receiving a score through conventional models due to their stringent scoreability criteria. And we can estimate that VantageScore can get to about 37 million of these consumers, meaning we can actually reach about 96% of adults in the United States and provide a reliable and accurate score for them. 

In our research we performed recently, our aim was to really better understand these newly scoreable consumers. Study what information they have in their credit profiles. Understand some of the demographics such as their age distributions, their income distributions. Understanding that race and geography representation. 

And we also looked at the association between scoreability and some of the key socioeconomic indicators, such as income levels, education, home ownership, and access to financial services in the communities consumers live in. We also looked at how race interacts with all of these different factors. A key goal for that research was to really identify consumer segments that we felt would be most benefiting from a more inclusive credit scoring model.

For more on this interview, listen to our full podcast. To access the latest consumer credit and small business insights, contact your Equifax account executive today, or visit us online at equifax.com/business. You might also enjoy checking out Economy.com by Moody’s Analytics  for the latest economic updates.

******We want to hear from you! What did you think of this episode? What would you like to hear our experts share in the future? Email us: marketpulsepodcast@equifax.com. 

RESOURCES mentioned in this podcast:

• Download the VantageScore report, “​​Combating Inequality with Inclusivity: Who Exactly is Credit Invisible and How are Racial Disparities Impacting Minority Homeownership Opportunities?” https://vss.credit/inclusivity
• Do you have the economic and consumer credit performance data you need?  With CreditForecast.com -- a joint product created by Equifax and Moody’s Analytics -- you can access data, forecasts, scenarios, analyses and more from analysts you trust. https://www.creditforecast.com
• Register for upcoming Market Pulse webinars from Equifax, plus access previous webinars and presentations.
• Download our latest Credit Trends reports. 

This portion of the transcription is edited for brevity. Listen to the full podcast for more great insights.

Katherine:

Sounds like these are potentially great conditions for entrepreneurs and those thinking about starting a small business. We've spoken on this podcast and in our Market Pulse webinars about the increases in cashless payments and a huge rise in e-commerce. But then there's also the funding capital and credit side to consider in starting a small business. So I'd be curious to hear what you are seeing in the data for small business credit performance and also availability?

David:

There is going to be quite a bit of demand for small business credit. There are many cases where businesses are being formed. If we look through business applications, we're seeing them coming in at a pretty high clip, on pace for 6 million new business applications in 2021. If we put that in perspective with 2018, 2019, that would typically be around 3.5. So there's new businesses. 

I think like all the work that Evan's doing, all the entrepreneurs out there, they are working to make the economy a more productive place. And I think the question then is what kind of financing is there out for these individuals? If we sort of start to look through the data, we saw that in 2020, private lending was a bit tight overall.

The signs are strong that credit is really coming back. 2020 was really about the PPP program and that's free credit. So, the private credit sort of stood on the sidelines, but the public credit really came in. Now that program is over. So the private lending needs to come back and it does seem to be coming back overall. 

Katherine:

I'm going back to one of the statistics that Dr. Rob Wescott shared on our June 4th webinar. He shared that a quarter of black-owned businesses report credit availability as their top business challenge due to COVID. And that represents more than double the percentage of Asian and white owned businesses. And I'm just curious Evan, with your network are you hearing that to be a problem? Are you hearing a similar message? And I guess moreover, what can we do to remedy this as an industry and as a community that wants to support all small businesses and entrepreneurs?

Evan:

A lot of people have great business ideas, but we need the capital to access them. Even to get to the point where you're considered worthy of getting a loan. Just the initial bootstrapping to incorporate your business and set up a bank account properly. And all of the little things which may seem so minute to certain demographics, for communities of color it's a little more challenging. We don't have as many resources around us to really get started. So when we talk about what we can do to be helpful, it really helps people to get through those initial steps. 

If we really want to be helpful to black founders, we need to help them from the very beginning and partner with them. Do things that uplift, so not just mentorship, but providing clients. Those things that bring actual dollars into the business start to help because now things are showing up on their balance sheets, and now it's easier to get a loan. Maybe it's easier to get an investor. 

For more on this interview, listen to our full podcast. To access the latest consumer credit and small business insights, contact your Equifax account executive today, or visit us online at equifax.com/business. You might also enjoy checking out Economy.com by Moody’s Analytics  for the latest economic updates.

******We want to hear from you! What did you think of this episode? What would you like to hear our experts share in the future? Email us: marketpulsepodcast@equifax.com. 

RESOURCES mentioned in this podcast:

• Kiddie Kredit is a mobile app designed to educate children on the credit system by completing chores. www.kiddiekredit.com
• Do you have the economic and consumer credit performance data you need?  With CreditForecast.com -- a joint product created by Equifax and Moody’s Analytics -- you can access data, forecasts, scenarios, analyses and more from analysts you trust. https://www.creditforecast.com
• Register for upcoming Market Pulse webinars from Equifax, plus access previous webinars and presentations.
• Download our latest Credit Trends reports. 

This transcription is edited for brevity. Listen to the full podcast for more great insights.

Theresa: So let's start with an update on the U.S. economy. What do you see on the horizon or what is important for our listeners to know about today, Cris?

Cris deRitis: The U.S. economic outlook is particularly strong. It keeps getting stronger or we keep updating our forecast with a more optimistic and positive view. And, really a couple of things have gone right over the last three months. First of all, we have the vaccination campaign that has really surpassed our expectations. We're vaccinating around 3 million people a day now throughout the country and opening up vaccination schedules to people who are younger. That certainly is helping to keep the spread of the virus under control and rebuild some of the consumer confidence. There's a lot of pent up demand that's out there. People are itching to get out. They're looking to shop. I hear that hotels are booked up throughout the summer in many of the key vacation spots. That's going to continue to push the economy forward. 

The second factor in the outlook is the stimulus packages that were passed in December and February. Those checks are going out now or have gone out, and that is certainly putting more money in folks' pockets. That is also contributing to some of the upgraded growth that we would expect in 2021. The Moody's Analytics’ outlook calls for about 6.4% growth in GDP in 2021 and then still very strong growth around 5.25% in 2022. 

Theresa: A number of times over the past year, we've talked about the K-shaped recovery. The upper leg of the K keeps going higher and the lower leg keeps going lower. Will we start seeing less divergence of the two economies?

Cris deRitis: We are starting to see perhaps the bottom leg of the K coming back up. The leisure and hospitality jobs are being added back. Those do tend to be lower income individuals. So, a strengthened labor market down at that part of the K is certainly beneficial. But at the same time, we are continuing to see growth in the upper part of the K as well. The stock market continues to go up. Housing prices continue to rise as well. So we might still see quite a bit of divergence there between those two legs, but at least the bottom seems to be moving upward. 

Theresa:  Let's talk a little bit more about that fifth round of stimulus. What are you seeing, Cris?

Cris deRitis: So this is the proposed American Jobs Plan. It's been pitched in some sense as an infrastructure bill, but it's much more than just traditional infrastructure. It's about funding initiatives that hopefully would increase productivity overall and really continue economic growth or long-term economic growth. So I view it as designed, in part, to fill some holes that we've had in our budget for a long time. So infrastructure spending, I think everyone agrees on both sides of the aisle. I don't think it is controversial that we need to replace some of our roads and bridges. And, there are some gaps in terms of our infrastructure spending on airports and ports. So we just need to modernize. So there's about $600 billion or so allocated within this $2.3 - 2.6 trillion package.

On top of that, you have other types of infrastructure, which I think are also equally valid. Rural broadband, for example. So, I don't think there's any real controversy around that. We want to, again, modernize our infrastructure in a way that can help more people access the labor market. And so it's not just about the roads, the physical roads. It's about the internet and being able to access the internet for school or work. 

There's a lot of things in there that makes a lot of sense, but then you have some other parts where there is certainly much more debate. And, there's funding in there for elderly and disabled care. Not that I don't think, again, anyone really disputes that we need to fund those things. But does that funding belong in this type of infrastructure package? And is this necessarily a spending that would be for investment and improving the productive capacity of the economy? Or is that more of an entitlement taking care of folks who we have promised through our Medicare, Medicaid programs to provide an adequate level of care in their old age, or as needed? 

For more on this interview, listen to our full podcast. To access the latest consumer credit and small business insights, contact your Equifax account executive today, or visit us online at equifax.com/business. You might also enjoy checking out Economy.com by Moody’s Analytics  for the latest economic updates.

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Jump ahead to these topics:

:56 - The latest in consumer insights

3:11 - Delinquencies are down

5:40 - How stimulus has helped consumers

6:45 - Small businesses

7:15 - Accommodations

8:40 - Geographic trends

11:14 - Additional insights

14:00 How lenders can grow their portfolio

This transcription is edited for brevity. Listen to the full podcast for more great insights.

Theresa: We would like to share the latest and greatest consumer credit insights on today's podcast. So, Tom, what's the latest? Are you seeing any major surprises in the consumer insights that you're looking at?

Tom: Not necessarily any major surprises yet. I think if we look back to what we forecasted a year ago, we probably would have thought of a few surprises. And of course we're seeing things continue to trend over time where balances are down across the board. The exception is the rise in mortgage balances that recently surpassed $10 trillion.

Theresa: And why is this surprising?

Tom: If we look back to last year with all the tightening that had occurred in the market and in particular, we saw consumer spend going down a lot. We've been talking about the various levels of belt tightening. I would not personally have forecasted first mortgage to be so high; however, with the interest rates being so low consumers have been accessing refinances. And one of the things that we did notice as well is that balances are down across the board. Utilization down across the board and delinquencies down across the board, which enables consumer scores to be higher.

And even though some lenders have been tightening, there's been a lot of pent-up demand. We've all been part of Zoom calls staying at home. I've heard many people say, “I can't wait for my next vacation.” Or, I have two or three ready to go. So we fully expect that there's going to be some return to normal spend levels as we look across bank card, private label and either home equity lines or even personal loans.

Theresa: What trends are you seeing with delinquency rates?

Tom: Across the board, delinquencies are down quite a bit. Even when we look at year-over-year rates, for example, bank card 60-plus delinquency rate from a dollar perspective is down about 24% compared to February of 2020. And utilization is 18% down. So, that's such a remarkable shift in delinquencies as we look at the year-over-year comparison because we all thought with unemployment on the rise, we would end up in a much more tricky situation.

Theresa: Let's talk about geographic trends. We've discussed in the past with our Vitality App that we were able to look at some geographical trends. What are you seeing across the U.S.?

Tom: This is why it's really important to dig in deeper both from the consumer side as well as the small business. It's really good to look at that because, as the example you described, there's going to be certain locations that can open up sooner outside. So restaurants will be able to be a little more open as we move into spring. In addition to that, we've overlaid the COVID rates by geography, and we're seeing there is some correlation between data points that have been either on the rise or are decreasing. And then, what type of industries operate within a given location?

For more on this interview, listen to our full podcast. To access the latest consumer credit and small business insights, contact your Equifax account executive today, or visit us online at Equifax.com/MarketPulse. 

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This transcription is edited for brevity. Listen to the full podcast for more great insights.

Theresa Freas: Top of everyone's mind is the second round of stimulus just came through. When we're talking about small business support, I believe it was $284 billion that was earmarked for PPP. How do you foresee that impacting the industry? And what did we learn from the first round that we should consider as we look to the impact after the second stimulus?

Sarah Briscoe: In the last round of stimulus, we saw a decrease in lighter delinquency [defined as accounts between 31-90 days delinquent], and we didn't really see a decrease in severe delinquency [accounts over 90 days past due] or in default -- sort of precursors to business closure. So I'm cautiously optimistic about the next level of stimulus, that perhaps it could save some businesses who may be on the cusp of becoming delinquent. But the amounts of aid that we're seeing, we didn't really see a decrease in business closures. So it's a cautious optimism, but I'm not sure how far it's going to go in terms of businesses who are severely struggling right now, if it will save those businesses at this time.

Theresa Freas: What trends are you seeing in severe delinquencies or the more mild delinquencies?

Sarah Briscoe: Right now, the 31 to 90 days past due rates are slightly up year over year. But they've flattened quite a bit since some of the sharp increases that we saw in the beginning of the pandemic, and then a sharp decrease of reopenings, accommodations extended and all of that. So the 30 looks closer to historical levels, although it's still a little bit elevated. Whereas with severe delinquency, think about something that's 91 plus days past due has sharply increased and has remained at a very elevated level. 

Theresa Freas: Do you see geographic patterns, whether in delinquency or lending trends?

Sarah Briscoe: At this time, the southwest has really started to stand out as a place that has seen a lot of high stress. Some of the highest stress in the country. Actually in December, Arizona showed the highest 91 to 180 day delinquency rate in the whole country, and it was over double what we saw a year ago for that state. New Mexico is the fourth highest. Nevada and California are both in the top 10. And a lot of this is driven by the huge impact of retail in these spaces. So it's a lot about what type of economy the state has and how it has been affected by drops in tourism, drops in business travel and conferences drying up. 

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This index measures the percentage of loans that are 31-90, 91-180 and 31-180 days delinquent based on the largest commercial and industrial lenders in PayNet's U.S. database, including both loans and leases. 

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This transcription is edited for brevity. Listen to the full podcast for more great insights.

Theresa: Let's start with the current round of stimulus that took effect at the end of December. There are few more common elements of the package, such as the one-time checks, unemployment and PPP. I’d like to take just a few minutes to really dig down into these elements.

Cris deRitis: There are really three main components to that package. One was a pandemic relief, so there was some additional support provided to vaccine distribution, testing and tracing. And we know that it remains front and center in terms of resolving this current crisis and getting us to a place where the economy can grow. So the pandemic has to be dealt with first, first of all. But in addition to that $900 billion package right at the end of December was critical because we were facing a number of programs that were set to expire. So there really was this so-called fiscal cliff where you could have seen a number of households being evicted. You could have seen a number of households losing out on their unemployment insurance benefits. And so that plan provided some household financial support as well, right? So the one-time stimulus checks and expanded unemployment insurance. And then finally it provided some support for small businesses, which remain critical through the recovery as well. And as we know, many small businesses continue to suffer, particularly those that are really exposed to say lockdown measures, retailers, restaurants. 

Theresa: And so the one-time check is for $600 this round?

Cris deRitis: Yes, $600 this round for individuals earning less than $75,000. And then it gets phased out after that.

Theresa: We've talked a number of times too, about how a lot of folks have been using this, whether it's the one-time check or the additional benefits of the unemployment insurance to pay down a lot of their debt and not necessarily taking out additional. . What kind of impacts does it have potentially to our listeners, predominantly lenders and service providers?

Cris deRitis: I would say it's largely positive for the consumer credit lender. This puts more money in folks’ pockets. It gives them again a little bit of a lifeline here. So households are, by and large, I believe going to pay down some debt and reserve some of the cash that they may be receiving for that rainy day or for that emergency.

Theresa: As we shift gears to the payment protection plan, share with us a little bit more insight there and the additional benefits that have been provided to small businesses.

Cris deRitis: This most recent round provides about $280 billion worth of PPP loans, focusing on micro-businesses or mom and pop businesses. It's really to protect the payroll, as the name implies. This latest round, also, I believe addresses some of the limitations or learnings if you will, from the previous round, in that it's more targeted to really the smallest of the small businesses. 

For more on this interview, listen to our full podcast. To access the latest consumer credit and small business insights, contact your Equifax account executive today, or visit us online at equifax.com/business. You might also enjoy checking out Economy.com by Moody’s Analytics  for the latest economic updates.

******We want to hear from you! What did you think of this episode? What would you like to hear our experts share in the future? Email us: marketpulsepodcast@equifax.com.

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• Download our latest Credit Trends reports. 

Theresa Freas:  It's been a big week. There's the electoral college meeting, vaccines are going in-market and then there's a lot of talk around the stimulus. So, where do you want to start? 

Cris deRitis: The biggest story for me is the vaccines. COVID-19, of course, is the story of the year for 2020, and economically we can't get back on our feet until we really deal with it. And so the vaccines give us the greatest hope for finally putting this behind us and starting to move on. It'll be a different world, but certainly better than what we've been through in 2020.

Theresa Freas: The Michigan Index came out today and it seems like consumer confidence was a little down. But you know, confidence has to be ticking up now that we’re actually moving forward with the vaccine. How do you see this impacting consumer spending or our financial behaviors as we move into the holiday season, as well as the first part of the year?

Cris deRitis: Confidence is really interesting. It is ticking up overall, but if you dig a little bit deeper and you break that out by income, you see a real difference. So, folks in the upper end of the income distribution, people who have been able to work remotely, maybe have some wealth in the stock market or are in housing, they’re doing pretty well. Their confidence actually is rising. At the other end, they’re still struggling. And they’re quite worried about the economic future between now and when those vaccines actually arrive to the full population. 

So, for the retail environment, I think you’re going to see those trends playing out. You’re probably still going to see a lot of demand for the essentials, groceries, household goods as people are still preparing to hunker down here. But some additional disposable wealth is available to folks at that upper end. 

Theresa Freas: It's a one-two punch, not just getting the vaccine out there, but also the stimulus. What do you foresee happening as Congress meets to decide on it? 

Cris deRitis: There is still a lot of uncertainty in the air in terms of what actually happens. And we've been going back and forth within our own economics group here, in terms of understanding what Congress will actually agree to. I think that the need for additional stimulus is known. I don't think there's much debate in terms of having to provide some additional support until we get that vaccine really working its way through the economy. 

My best case scenario actually would be some type of deal that gets us to February. So kick the can if you will, down the road until the next Congress next administration. That to me seems like the most plausible path at this point.

Theresa Freas: What do you think the chances are that Congress will push something through this week? What are the chances that we will see some form of PPP return or that direct check payment or extended unemployment benefits that will have that short-term fix? 

Cris deRitis: I'm hopeful. But given that we haven't been able to put something together so far, and you have that political reality of the Georgia races out there, I'm not terribly optimistic. That certainly would be a nice holiday gift to the American people, if we could actually put something together.

Theresa Freas: Back to consumer credit. Small business credit impacts not only to lenders, but even to the telecom industry or utilities and retail. I think we touched on retail already, but what are some additional impacts that we might see in the credit industry? 

Cris deRitis: The vaccine news certainly has bolstered our confidence around our longer-term outlook. So looking out six, nine, twelve 12 months from now, we see certainly a brighter future than we did just a month ago, right before the vaccine news actually came out. So, much more confident in terms of the recovery and the strength of recovery. 

We have uncertainties between now and then, and that's where the stimulus comes into play to my mind. So when we think about, say telecom, or any type of unsecured lending, that's certainly something that would be at risk of potential losses or delinquencies in the short-term. Mortgage is somewhat insulated by extended forbearance programs. And I do expect that the foreclosures will continue to get pushed off into the future. So that might avoid a sharp uptick in losses certainly in the short term. But again, I think there is some uncertainty there, particularly for those unsecured credits that are out there.

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Theresa: How does the announcement of a vaccine nearing trial completion impact your outlook into 2021?

Cris deRitis: The announcement of the vaccine(s) is certainly a positive in terms of the economic outlook. It's going to help restore consumer confidence and business confidence. Just the fact that a vaccine exists, even if it takes some time to come to market and be fully distributed, is positive from a public health and a social perspective. The economic outlook is certainly an improvement to the trajectory of the forecast going forward. Of course, that does have to be tempered with the recent spike in the caseload. The sooner we get that vaccine distributed, the faster we'll be able to restore confidence and get the economy back on a more self-sustaining recovery path.

Theresa: With the continued pandemic-led uncertainty combined with our recent elections, what is the outlook on any additional stimulus? That's a topic we've touched on in previous podcasts, but what do you see as our outlook for additional stimulus now?

Cris deRitis: Stimulus, in terms of the short-term outlook of the economy, is critical. It's not a question of if we will get a stimulus, it's more a question of how much. It's very likely to come after the new Congress takes office, as well as after the new president is inaugurated. So, we're looking at a February timeframe at this point. The amount of stimulus is really dependent on the Senate. What happens with the elections in Georgia? If the Congress remains split, then we're looking at a smaller stimulus package -- perhaps closer to between $500 billion to a trillion dollars of support for households and small businesses. If the Democrats were to take control of the Senate along with the house, then it could be a much larger package. And, certainly that would have implications for the amount of growth we could expect both in terms of output and employment.

Theresa: In the latest quarterly Senior Loan Officer Opinion Survey, I noticed that there's a reference to continued tightening of loan underwriting standards by banks -- although far less in Q3 than we saw in Q2. Do you see that tightening continuing through Q4 and into 2021?

Cris deRitis: Yes, I do think banks will continue to remain on guard in Q4, and certainly as they look at the rise in COVID cases. That's front and center in terms of the outlook, at least in the short term. They may be encouraged by the announcement of the vaccine(s), but we have to wait and see what the actual path or trajectory of the vaccine is. There are going to be additional approvals, and we're going to need some time to actually have it distributed. On top of that, the stimulus is the big wild card when it comes to consumer credit. We are going to see defaults. It will likely be the result of inadequate stimulus or stimulus that is pushed out too far into the future. So, I do expect that banks will remain guarded, at least for the short term. And then as we go into Q1, and we start to see things hopefully improve at that point, they will be more willing to ease up on lending standards and provide additional credit support to the economy.

Theresa: Chris, what trends are you seeing in the consumer credit and lending data? Anything jumping out since our last podcast?

Chris Walker: Yes, a few things. Overall, debt is up about 0.8% when looking back to the pre-COVID period. And delinquencies have been steady overall for the last several weeks, with the last ten weeks at about 0.6%. And when we look at certain products like auto and first mortgage, they're very strong. Both of those products are up compared to the pre-COVID period. Auto is up about 1.9%. And most recently, we've been seeing a delinquency rise in auto. It's still well below the pre-COVID level, but we have been seeing that trend. Mortgages are up about 2.1%. So, very strong originations for both of those. 

Theresa: David, let's shift to expectations for spend in the near term and into 2021. What are you seeing in the forecast?

David Fieldhouse: When we want to look at spend, retail sales is going to drive that overall. We are producing forecasts in that space. And I really think it's very relevant for credit data. Obviously, we saw a dip in the summer and then a bit of a rebound in Q3. So, retail spending overall is kind of back to the level it needs to be. And we're actually expecting a good Q4. There are bright spots. Spending is very strong in online stores. And we think there's a bit of a shift from services to goods overall. So, we're expecting an above average Q4 in terms of retail spending.

Theresa: We're going to shift gears now to the impact and outlook for small businesses. Sarah, what are you seeing in the indices lately for lending or delinquencies?

Sarah Briscoe: Delinquency is down overall. Nationally, lending is up overall since the pandemic start. Definitely, many pockets are struggling. We're seeing more positive trends in lending in the north of the country with decreases in lending in much of the rest of the country. Transportation is looking a bit better; it was elevated earlier in the year. Retail healthcare is still looking a little bit rough around the edges in terms of delinquency.

Theresa: You know we were talking with Cris earlier in the episode, around the spikes in COVID again. How might that impact small businesses today or as we look to 2021?

Sarah Briscoe: Based on previous spikes, we've seen that default rates consistently are increasing for states that have the most COVID cases. Texas, California, Florida and New York all saw high default rates corresponding to high COVID cases. I expect the trend will be similar for a renewed COVID-19 surge. Some businesses may now be better able to adapt now that they've experienced it once. But any businesses focused on travel, food or any high risk in-person service, will probably be impacted from the winter months and from COVID increases and business closures.

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Theresa: Let’s start with the macro economy, and more specifically, fiscal stimulus. Chris, it seems things are changing by the day, and at times, by the hour. Are we going to get additional stimulus? And if so, when and what might it look like?

Cris deRitis:

That's a great question, Theresa. It's really critical to the economic outlook, certainly in the short term. I think the question really is when. I'm fairly confident that we will get some fiscal stimulus because the economy remains weak, although there's been some improvement. We are putting more people back to work. Still, we have over 800,000 people filing for unemployment every week. So, clearly there is a need for some additional support. The timing now really depends on the election outcome. I believe there's a chance that we are able to reach a deal before the election, and every day we get another piece of information that sounds encouraging at times; It sounds discouraging other times. So, it's possible that we get something before the election, but my working assumption right now is that it will be after the election. And then, the precise timing will depend on who actually wins the election.

Theresa: I know I've seen updates around whether we'll get another $1,200 stimulus check and potentially extended unemployment benefits. You and I have discussed the aid to state and local governments. Can you help us understand how each of those elements might go?

Cris deRitis:

I think all of these elements are still on the table. Again, there's negotiation going on, on both sides with the house Democrats and the Senate Republicans in the White house, having all different views. I think each one of these elements or some flavor of these elements is still likely to show up in the final package. 

I think the debate is really around the size of the checks. Maybe the qualifications on the amount of money that might be granted for families with dependent children or older dependent children. So those are really the details where we have some other debate, but I do expect to see some form of check going forward. 

The extended unemployment insurance benefits have been critical as well. That's the extra $600 a week that folks were getting as part of their unemployment insurance package. That extension ran out at the end of July, essentially. At this point, you have families really making do with the standard benefit and with whatever savings they've accumulated. And that means that they are now vulnerable. At this point, as we were looking at October, November, some of those savings are running awfully low.

Theresa: Last time we spoke about the potential shape of the recovery, and even during the presidential debate a few weeks ago there, the topic of a K-shaped recovery came up. Do you still see the K-shaped recovery? And help us understand a little bit how that's looking.

Cris deRitis: Unfortunately, I do. Another way to put it is that we have a two-track type of recovery. You have one part of the population that is doing relatively well – or even great. But some households, some individuals are certainly doing better than others. So, the recovery has been much stronger for those folks who have jobs where they can work from home. Higher income and higher wealth households are doing better. More highly educated people certainly have more opportunities. Their stock market portfolios have recovered in terms of their values, house prices continue to rise. 

On the other hand, you have the 75% of the population or so who have to show up to work. They can't work from home very effectively. And they may be working in industries that were very hard hit by the COVID-19 crisis. So, if folks are working in leisure and hospitality or bricks and mortar retail, the economic recovery is certainly much, much slower. And they may not have savings or some of the stock market wealth that I alluded to. So, I am concerned that we will have even more inequality, at least for a while, as we work through this recovery. And that’s all the more reason why we need additional fiscal stimulus, particularly to ensure that those folks who are struggling to move ahead in this recovery have the support they need to put food on the table and meet their obligations. And at the same time, give them some breathing room to look for a job or to start a business.

Theresa: Now we're going to shift to focus more specifically on consumer credit, both current trends and outlook. Chris, is there anything in the data that is really jumping out at you today?

Chris Walker:

There is. Total consumer debt is up about 3%. The delinquencies still remain low, and they're actually about 50% less than they were a year ago. We know that's driven by the CARES Act. When you drill down, you go into certain products. So, auto and our bank card and private label cards -- all those have actually been experiencing somewhat of a rise in delinquency over the past few weeks. And that corresponds to declines that we've seen in possible accommodation. Now, the percentage of balances that we see under a form of possible accommodation reached a peak in June of this year. And since that time, it has been declining. This past week, we held at 6.9% of balances under one of the forms of possible accommodation. But a couple of accounts actually started increasing and that's the first time we've seen that since we began tracking possible accommodations, and it was really around the card and home equity. All the others really remain steady.

David Fieldhouse: We are forecasting that delinquencies will rise. So, if payments took a holiday in the summer, and we didn't see any delinquencies in the summer, some of that's going to come due in the fall and heading into the winter. Across the board, our models are forecasting rises in delinquencies. It's definitely very muted in a space like mortgage because it's being supported by a really active, healthy housing market.

But when we look at auto, specifically looking at more of the auto finance, we see some problems emerging. Our models are forecasting rises and delinquencies. When we look at bank card or retail card, we are also seeing our forecast driving higher delinquencies. A lot of that has to do with the labor market still being in rough shape. The story of the summer has been that the economy has been bolstered by all the extra disposable income. But once we get into fall, especially if that stimulus doesn't arrive, we're really going to have a credit market in an economic environment with a 7% unemployment rate. That's going to start to really drive up delinquencies.

Theresa: Sarah, what do you see as you look at the data on small business credit trends today?

Sarah Briscoe: Lending has dropped a little from the short-term increases that we saw earlier this year. So, this month we did see a little lending drop. The biggest drops were accommodations and food, arts and entertainment and education, which makes sense given the uncertainty of the conditions in those industries. Construction is really the only industry that's showing extremely positive growth right now in terms of lending. 

For delinquency, we’re seeing drops. That would be 31 to 90 days past after a steep increase ea...

Theresa: Cris, let's start with the broader economic landscape. Where do we go from here?

Cris deRitis: Clearly it does feel like something else is happening. I think of the economy today as being right in the eye of a hurricane. We had that first wave of the hurricane back in March/April with COVID-19 coming into play and the shutdowns going into effect. After that, we kind of entered the eye of the hurricane as we provided some stimulus to the economy and parts of the country did start to open up once again. And now it feels like we're about to go on the other side of this hurricane. And for that reason, I do think the next six-12 months are going to be a struggle. I think there is going to be some pain when it comes to businesses going out of business because they've received some support. 

But now that that support is ending, I do expect to see a number of businesses failing and that's going to take a lot of jobs down with them. I think the next few months are going to be a struggle when we are dealing with the virus, dealing with the lack of fiscal support coming from the government. There are some brighter spots out there. So, I don't think things are falling off the cliff, but I think we have to be prepared for some leaner times ahead until we, we see some brighter days here. 

Theresa: Do you see that having a short-term impact on consumer spending?

Cris deRitis: Absolutely. I think the stimulus, the expanded unemployment insurance that we've been providing to folks has been instrumental in keeping credit card balances, other balances, other consumer debt products, keeping their delinquency rates relatively low. The, the extra money definitely helps in an environment where you do have such high unemployment and we still have 30 million people who are receiving some form of unemployment insurance benefit every week. So still a lot of households and families are dependent on that aid. So, despite the fact that we've seen some improvement in the labor market and certainly hope to see that continue, I think you are going to see a number of families struggling until that labor market does fully heal.

Theresa: You mentioned a moment ago that there are some bright spots that it's not all doom and gloom. Can you share what those are?

Cris deRitis: So any company offering video conferencing services or any of the businesses that have been able to successfully transition to online or delivery... certainly they're doing all right. And their employees have fairly stable prospects there. Some of them are even getting some wage increases. So there are certainly some winners, if you will. Another interesting stat I just ran across was the number of new business applications. So this actually is actually up over the last few months, so we do see some revival of entrepreneurship. Now it might be too early see how far this actually goes, but that's certainly a positive sign that the people who may be out of work are looking ahead, are still remaining optimistic and looking for ways to increase their income, find new opportunities by starting their own business. So I do think that there's still a lot of resiliency in the U.S. economy.

Theresa: Another question that we often get is what direction will the economy take?

Cris deRitis: Right now it looks like a check mark or extended check mark where we had that sharp drop in activity earlier in the year as we were shutting down much of the country. And then as we've been reopening and we've been adding back jobs to the economy, we've slowly seeing things improve over time. Now there is certainly a risk of some downfall after this, some weakness going forward. But we do expect to see the economy kind of trugging along if you will overall over the next few quarters here.

Once we get a vaccine or a therapeutic, or we have some way to really deal with the virus, we do expect to see some acceleration. Now that said, I would say that the economy is more of a K type of recovery in the sense that you have some people who are doing really well like people who have had exposure to the stock market. People who are able to work from home are doing relatively well. And you can see that in terms of home sales and auto sales, but there are certainly another part of the country that is on a much more serious downward type of path. Folks who have been working in leisure and hospitality industry, for example, or the tourism industry or the airlines.

Theresa: Let's talk more about consumer spending and potential impact on consumers.

Cris deRitis: We are seeing some very strong changes or very large changes in the way consumers are spending. We are a service-based economy, about 70% of all consumption goes to services. And yet in this latest shock due to the Coronavirus, we've seen that services have taken the largest hit. All parts of the economy are certainly down, whether that's a durable goods or non-durable goods. Those sales are also down, but they're not down as large or in percentage terms as what we've seen in services. So we do see consumers really cutting back on services of all kinds, whether that's financial services or a restaurant type of service.

Theresa: What trends are we already seeing in the consumer credit?

Chris Walker: We have seen a couple of products where there has been rising balances, albeit well below the pre-COVID period. But one of those is auto. And I know Chris mentioned that as well, and that's one that we've been seeing rise. And, we've also been noticing from a form of possible accommodation that there's been a drop off there for the auto sector. And now that seems to be relaying into a rise as well in auto delinquency. And we've noticed a slight rise there for the second a week in a row.

Theresa: You mentioned that we're starting to see a drop in possible accommodations for auto and that, that might be translating into delinquencies. Tell me about that.

Chris Walker: Yes, exactly. So since the enactment of the CARES Act with one of the six forms of possible accommodations being placed on the file by particular product we've been trending that and overall it's trended down slightly over the last four or five weeks. But auto in particular has had the largest decline in possible accommodation. And it's mainly come from from two codes. One of those is the disaster code that lenders use to report that form of possible accommodation to us. The other is inferred where we are calculating and inferring that a loan is under a possible accommodation combination by looking at 1) the balance and 2) the scheduled payment amount. And in that case, the scheduled payment amount would be zero, but yet it would have a balance. So we're using that as inferred. So those two codes have been declining the greatest for auto over the last few weeks. And now we're seeing an uptick over the last month of auto delinquencies. So we're seeing those slightly rise week over week.

Theresa: David, what are you seeing on the forecast side of things?

David Fieldhouse: We are definitely forecasting some problems in auto. What we are seeing towards the end of the year is definitely a rise in delinquencies. And this is coinciding with the labor market still having problems and all the stimulus money beginning to dry up or at least not be as plentiful as it was earlier in the year. So we are anticipating some pr...