How Inflated Credit Scores Are Leaving Investors in the Dark

The video discusses how economic growth has led to rising credit scores, but the inherent risk of consumers remains unchanged. Some lenders have not adjusted their underwriting to account for this, leading to potential risks, especially in subprime lending. Moody's highlights the issue of unaccounted risk, which could result in increased delinquencies and losses for investors. The video emphasizes the need for lenders to consider additional factors like debt-to-income ratios to better assess risk.

What does Moody's suggest about the current state of subprime auto loans?

What factors do some lenders need to consider in addition to credit scores when assessing risk?