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Delinquency Information

Delinquency Schedules
a. Delinquency ratios
The delinquencies are determined as follows:

1. The inital delinquency ratio must be supplied as an input data field.

2. The delinquency assumption is a vector satarting oin the first month and going throught the last omnth of the loan life. We asssume delinquencies must change smoothly over some period. If the initial ratio is zero and the assumption is 3% then the ratio is raised proportionalty from the initial ration to the assumed ration over a user defined number of months.

All loans in a group may have the same delinquency assumption. However, They may all have diffreent starting ratios. If the starting ratio is higher than the assumption then additional late fees will be collected.

lvdel - Initial deliquency ratio
lfdel - Delinquency forecast
lrdel - Total Delinquency ratio

The delinquency ratio in the allocated month is found and the rate is stepped from the original delinquency to the rate in the stated month.

 Delinquency Ratios

LCDEL=(LRDEL * LLCNTA)

LCFOR =(LRFOR * LLCNTA)

LRDELT=( LRDEL + LRFOR )

LCDELT=( LCDEL + LCFOR )


 Foreclosure ratios


lvfor - Initial foreclosure ratio
lffor - Foreclosure forecast
lrfor - Total foreclosure ratio

Late fees
Late fees are accumulated in the following manner: 3.1 Late fee on T&I
3.2 Late fee on P&I
3.3 Late fees on 17 day accounts
3.4 Late notice posted day
3.5 Late fee vectors
LLLFEP Total late fee on P&I LLCNTB Current loan count LVPICO P&I constant per loan LRDELT Total Delin and foreclosuyre LFD17 Amount collected on th 17 of month LVLATP Late fee on P&I LFVLP Late fee P&I factor Vector to allow changes LFVLC Late fee collection ratio
-- [totdel + 17 del] * pico * avg_cnt * rate * factor * col_ratio
-- LATE FEE TOTALS
-- Late fee P&I LLLFEP=((LLPRIT+LLINTT)*((1-LRDELT)*(1-LFD17)+LRDELT)*LVLATP*LFVLP*LFVLC )
LLLFEP=((LLCNTB*LVPICO)*((1-LRDELT)*(1-LFD17)+LRDELT)*LVLATP*LFVLP*LFVLC )
-- Late Fee T&I LLLFEE=(LLEDEP*(1-LFD17+LRDELT) * LVLATE * LFVLE * LFVLC )

 Delinquency Spreads
lvdspr - Delinquency monthly distribution spread It is important to know what the average months of delinquency is. Without this information you cannot calculate the advance. The delinquency distribution states what percentage of the total delinquents exist in that month of delinquency. The model calculates the average number of months delinquent from this spread.

lvfspr - foreclosure monthly distribution spread The foreclosure spread works exactly like the delinquency spread.
 Delinquency Costs 
  Vector C1[a] Monthly delinquency/foreclosure servicing cost
  Vector I1[m] Inflation rate on the monthly delinquency cost

  Vector D1[m] Count of loans delinquent 
  Vector D2[a] Delinquent dispersion

  Vector F1[m] Count of loans in foreclosure
  Vector F2[a] Foreclosure dispersion

  Vector DCost[m] Total delinquency cost in current month

  DCost = sum of [ c1[a] X i1[m] X ( d1[m] X d2[a] +  f1[m] X f2[a] ) ]

  Calculation
  ----------------------
  The calculation must cycle until the dispersion goes to 0.

  Cycle Month  m = 5
  For the current month:

  Delin Month  a = 1
  WHILE Dispersion > 0 then

    Var 6 = Var 6  Plus

    DCost = sum of [ c1[a] X i1[m] X ( d1[m] X d2[a] +  f1[m] X f2[a] ) ]

    Times the loan count for the period m.

    Time the servicing cost inflation rate for the period m.

    Increment a by 1

  END


  Notes:

  1. This is only for delinquency not current loan servicng cost.
      All vectors start at 1 ( One month delinquernt)

  2. If you set the dispersion to be 1 in the first month, then
     you minimize the cycle time.



  Vectors
  -------------------

    adbl_llcnta(k)  - Loan count  in the current month

    '--  Number of loans delinquent
    adbl_lcdel(k) = (adbl_lrdel(k) * adbl_llcnta(k))

    '--  Number of loans in foreclosure
    adbl_lcfor(k) = (adbl_lrfor(k) * adbl_llcnta(k))

    adbl_llcdel(k)  - Total delinquency cost in the current month

    adbl_lcdel(k)   - Delinquent count in current period 
    adbl_lfdel(k)   - foreclosure  count in current period 


    New Vectors
    -------------------------
    This cost vector is the additioanl cost to service in each delinquent
      month.  No distinction is made for delin vs foreclosure.

    
    adbl_lfcdem(k)  - Delin/FC cost for each month delinquent
                      1 = One month delinquent cost
                      2 = Two month delinquent cost
    
    adbl_lfnds(k)   - Delin/FC cost inflation
                      360 month schedule of delinquency cost inflation

    Obsolete
    -------------------------
    adbl_lfcdel(k)  - No longer used!