Total structural risk model

• US 7,814,008 B2
• Filed: 02/29/2008
• Issued: 10/12/2010
• Est. Priority Date: 02/29/2008
• Status: Active Grant

• Current Assignee: American Express Travel Related Services Company, Inc. (American Express Company)
• Original Assignee: American Express Travel Related Services Company, Inc. (American Express Company)
• Inventors: Choudhuri, Tirthankar, Gupta, Amber, Dewan, Anjali, Xu, Di, Haggerty, Kathleen, Yuan, Chao
• Primary Examiner(s): Colbert; Ella
• Assistant Examiner(s): OJIAKU, CHIKAODINAKA
• Application Number:
  US12/040,786
• Publication Number:
  US 20090222377A1
• Time in Patent Office: 956 Days
• Field of Search: 705/36, 705/37, 235/379, 707/688
• US Class Current: 705/38
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/03 Credit; Loans; Processing thereof
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

The present invention generally relates to financial data processing, and in particular it relates to credit scoring, consumer profiling, consumer behavior analysis and modeling. More specifically, it relates to risk modeling using the inputs of credit bureau data, size of wallet data, and, optionally, internal data.

Claims

1. A method for obtaining a comprehensive consumer default risk value for a consumer with respect to an existing debt obligation secured by an automobile, wherein said comprehensive consumer default risk value is derived by a risk analysis computer, said method comprising:

requesting said comprehensive consumer default risk value for said consumer; and

receiving said comprehensive consumer default risk value for said consumer, wherein said comprehensive consumer default risk value is calculated by determining a comprehensive consumer default risk value, said determining comprises;

obtaining, at said risk analysis computer, wherein said risk analysis computer comprises a processor, a memory, and a data store, consumer credit data relating to said consumer;

obtaining, by said risk analysis computer, internal data relating to said consumer wherein said internal data is derived from a credit issuer'"'"'s transaction system and comprises a payment history of said consumer and consumer transactional data pertaining to particular transactions in which said consumer has engaged and including at least one of transaction amount, transaction time, transaction merchant, transaction merchant location, and transaction merchant web address;

modeling, by said risk analysis computer, consumer spending patterns of said consumer using said consumer credit data to obtain an estimated spend capacity of said consumer; and

calculating, by said risk analysis computer, said comprehensive consumer default risk value for said consumer, wherein said calculating comprises assigning said consumer to a consumer population segment based upon primary residence value and selecting an appropriate risk factor relationship based upon said consumer credit data and merchant data contained within said internal data, and wherein a coefficient is selected based upon the assigned population segment,

wherein said calculating is based upon said consumer credit data and said estimated spend capacity, wherein said comprehensive consumer default risk value represents a risk associated with said consumer defaulting on an existing debt obligation and said comprehensive consumer default risk value comprises a probability value between 0 and 1.

2. The method of claim 1, further comprising determining a strategy to interact with said consumer based on said received comprehensive consumer default risk value.

3. The method of claim 1, wherein said determining a strategy further comprises making automobile loan approval decisions for said consumer based upon said received comprehensive consumer default risk value.

4. The method of claim 1, wherein said determining a strategy further comprises purchasing notes secured by automobiles in accordance with said received comprehensive consumer default risk value.

5. The method of claim 1, further comprising establishing a new automobile loan account based upon said received comprehensive consumer default risk value.

6. The method of claim 1, further comprising originating a automobile loan based upon said received comprehensive consumer default risk value.

7. The method of claim 1, further comprising changing an interest rate on a variable rate automobile loan based upon said received comprehensive consumer default risk value.

8. The method of claim 1, wherein said method for determining a comprehensive consumer default risk value further comprises:

receiving, by said risk analysis computer, credit bureau data comprising a plurality of accounts of said consumer over a previous period of time;

identifying, by said risk analysis computer, any balance transfers into at least one of said plurality of accounts based upon said credit bureau data;

discounting, by said risk analysis computer, any spending identified for any of said plurality of accounts for any portion of said previous period of time in which a balance transfer to such account is identified; and

estimating, by said risk analysis computer, a purchasing ability of said consumer based on said credit bureau data and said discounting.

9. The method of claim 1, wherein said obtaining further comprises:

issuing a query to said data store for said consumer credit data;

storing said consumer credit data in a memory.

10. The method of claim 1, wherein said calculating further comprises:

retrieving said consumer credit data from said memory;

performing, by said processor, a calculation using said consumer credit data to calculate said comprehensive consumer default risk value;

storing said comprehensive consumer default risk value in said memory.

11. A system for obtaining a comprehensive consumer default risk value for a consumer with respect to an existing debt obligation secured by an automobile comprising:

a risk analysis computer comprising a processor, a memory, and a data store, wherein said risk analysis computer is configured to obtain consumer credit data relating to said consumer, wherein said risk analysis computer is configured to obtaining, by said risk analysis computer, internal data relating to said consumer wherein said internal data is derived from a credit issuer'"'"'s transaction system and comprises a payment history of said consumer and consumer transactional data pertaining to particular transactions in which said consumer has engaged and including at least one of transaction amount, transaction time, transaction merchant, transaction merchant location, and transaction merchant web address;

wherein said risk analysis computer is configured to model consumer spending patterns of said consumer using said consumer credit data to obtain an estimated spend capacity of said consumer,

wherein said risk analysis computer is configured to calculate said comprehensive consumer default risk value for said consumer based upon said consumer credit data and said estimated spend capacity by assigning said consumer to a consumer population segment based upon primary residence value and selecting an appropriate risk factor relationship based upon said consumer credit data and merchant data contained within said internal data, and wherein a coefficient is selected based upon the assigned population segment,

wherein said comprehensive consumer default risk value represents a risk associated with said consumer defaulting on an existing debt obligation and said comprehensive consumer default risk value comprises a probability value between 0 and 1.

12. A tangible computer readable medium having stored thereon, computer executable instructions that, if executed by a computing device, cause said computing device to perform a method for obtaining a comprehensive consumer default risk value for a consumer with respect to an existing debt obligation secured by an automobile comprising:

requesting said comprehensive consumer default risk value for said consumer; and

receiving said comprehensive consumer default risk value for said consumer, wherein said comprehensive consumer default risk value is calculated by determining a comprehensive consumer default risk value, said determining comprises;

obtaining consumer credit data relating to said consumer;

obtaining, by said risk analysis computer, internal data relating to said consumer wherein said internal data is derived from a credit issuer'"'"'s transaction system and comprises a payment history of said consumer and consumer transactional data pertaining to particular transactions in which said consumer has engaged and including at least one of transaction amount, transaction time, transaction merchant, transaction merchant location, and transaction merchant web address;

modeling consumer spending patterns of said consumer using said consumer credit data to obtain an estimated spend capacity of said consumer; and

calculating, by said risk analysis computer, said comprehensive consumer default risk value for said consumer, wherein said calculating comprises assigning said consumer to a consumer population segment based upon primary residence value and selecting an appropriate risk factor relationship based upon said consumer credit data and merchant data contained within said internal data, and wherein a coefficient is selected based upon the assigned population segment,

wherein said calculating is based upon said consumer credit data and said estimated spend capacity, wherein said comprehensive consumer default risk value represents a risk associated with said consumer defaulting on an existing debt obligation and said comprehensive consumer default risk value comprises a probability value between 0 and 1.