PayNet Launches Predictive
Construction Equipment Credit Score
PayNet announced the release of
its new Construction Equipment Credit Score.
The system was developed by
a group of mathematicians and construction credit professionals using a data
pool of construction equipment loans and leases.
According to the
company, the development process considered hundreds of potential variables, and
while several of the traditional delinquency-based variables made the cut, there
were many predictors unique to the construction industry, such as ones looking
at patterns of delinquency between different times of the year, reflecting the
seasonal nature of some segments.
SIC code, within the construction
industry, business size, and types of equipment financed are considered in the
score, as are borrowing patterns, such as average transaction term, the number
of lenders used and the extent to which a borrower's recent financing is with
new lenders as opposed to longstanding lenders.
"Not surprisingly, this
model's performance statistics are far superior to those of commercial scores
that don't focus specifically on construction equipment, because this score is
built on and optimized for construction equipment transactions" says Bill
Phelan, president and co-founder of PayNet.
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