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Credit Risk Management and Assessment Model

Tuition Options’ credit risk management and assessment model captures critical data points enabling a school to make informed enrollment decisions. Benefits of this model include:

• Provides a school with a credit scorecard of expected collectability of tuition customized to the school’s risk tolerance.
  
  
• An ability to assess the repayment capabilities of both students and co-borrowers.
  
  
• Equips admissions and enrollment management personnel with the necessary tools to admit an incoming or existing student based on defined criteria.
  
  
• Provides an assessment and third party servicing of institutional receivables enabling a school to maximize the liquidity of the asset.
  
  
• Expedited credit decision and reporting to school via proprietary credit engine processing.
  
  
• Defines expected cash flows.
  

Two Phases of a Scorecard:

Phase 1: Provides a school with general trends on dropout rates, co-borrower percentages, average amount of indebtedness, FICO score range and default characteristics.

Phase 2: Customizes a school’s indicators -- correlating to general market measurements. For example, if your school has a higher co-borrower percentage than the average indicator, it would likely improve the recovery of your tuition receivables.

Conversely, if your attrition rates are higher than the average, it would likely lessen the recovery rates of your tuition. Scorecards will provide standard deviation on key variables affecting the collectability of your tuition receivables.