Defining Loan Analysis Ratio Calculations

Screen ID:

Screen Title:

Panel Number:

ULNRAT-01

Ratio Rating Definition

2375

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Access this screen by selecting Tool #170: Base Ratio Analysis Configuration (maintenance) or Tool #945: View Base Rate Analysis Config (inquiry) or when you use Ratio (F6) on the initial Loan Category Configuration screen.

This screen is used to configure how your credit union “ranks” a member's debt-to-income ratios.

NOTE: This screen can also be accessed while configuring a loan category. Notice the Loan Category field at the top of the screen: if a loan category appears, changes will affect that loan category only. If “00” appears, changes will affect all loan categories which have not been configured separately.

When a member completes a loan application, the system evaluates all available debt and income information and calculates these ratios for that member. In order to evaluate what the calculated ratio means, this screen allows you to define a range of ratios to be designated as either “Class A,” “Class B” or “Class C.” A rating of “A” represents the lowest risk; “C” represents the highest risk.

Following is a sample rating configuration:

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With this configuration, any expense-to-income ratio from 0 up to 30.000% would receive an “A” rating; any ratio between 30.001% and 44.999% would receive a “B” rating; and any ratio of 45% and over would receive a “C” rating.

When all ratios have been defined, use Enter to save the changes and return to the Home Page.

Field Descriptions

Field Name	Description
Loan Category	If this screen was accessed during loan category configuration, a loan category will be shown in this field. Any changes to the ratio ratings on this screen will affect that loan category only. If this field shows loan category “00,” any changes to this screen will affect all loan categories, except for those loan categories configured separately.
A (Up To)	For each of the debt-to-income ratios listed, enter a number using three digits past the decimal. Any ratios falling between 0 and this number will receive an “A” rating.
B (Between)	The system will automatically assign a “B” rating to all ratios which fall between the entries in the “A” and “C” fields.
C (From)	For each of the debt-to-income ratios listed, enter a number using three digits past the decimal. Any ratios at this number or higher will receive an “C” rating.