Columbus, OH – Today, Navatros and Verify4 announced a strategic partnership to make housing more affordable by improving income verification processes and cut costs as housing prices continue to rise. Through their partnership, Navatros and Verify4 aim to reduce red tape and overhead costs for organizations like Metropolitan Housing Authorities and credit unions, which will allow more funds to be invested in affordable housing programs and help more people achieve homeownership.  

“Credit unions are committed to the financial empowerment and well-being of every community. Our partnership with Verify4 will offer credit unions the opportunity to streamline key processes that often get in the way of families and individuals accessing the housing they need at a price they can afford. We look forward to working with Verify4 and credit unions to help make sure more people can secure the housing they need to achieve their financial dreams,” said Kyle Alford with Navatros.

“We are thrilled to partner with Navatros and the Ohio Credit Union League to deliver real-time verifications to credit union members and residents across Ohio. This collaboration highlights the power of community-focused organizations working together to drive meaningful economic growth and strengthen communities statewide,” commented Dr. Michael Turner, CEO and Co-founder of Verify4.

Verify4 offers income and employment verification services to speed up the verification process, reduce fraud, and cut down on administrative costs. Taken together, these services will help organizations like credit unions increase efficiency and confidence in lending decisions and enable housing providers to cut costs, allowing them to direct funding to programs that reduce housing costs and increase affordability.

 Credit unions and MHAs interested in learning more can contact: Kyle Alford with Navatros.

About Navatros

Navatros is an expert financial industry leader providing personalized business solutions to credit unions and financial organizations. Since its start in 1966, Navatros has worked tirelessly to protect customers’ growth and well-being by helping them solve their challenges and achieve their goals. As a division of the Ohio Credit Union League, Navatros knows the credit union industry and has the experience, resources, and vision to create meaningful change for credit unions and their communities.

About Verify4

Verify4 provides high-coverage income and employment verification services at disruptively lower prices for credit unions, PHAs, and other community-focused end users. We partner with state governments and end users (such as credit unions, employers, and government agencies), acting as a trusted way to better solve employment and income verification problems. We connect people to their data for their benefit in a secure and privacy-centric manner. We build a better future for all, one community at a time. 

The federal electric vehicle (EV) rebate that once knocked $7,500 off new EVs (and $4,000 off used EVs) officially expired on September 30, 2025 (Kiplinger). This abrupt end to incentives is sending shockwaves through the auto market. EV sticker prices effectively jumped overnight now that buyers can no longer count on a big tax break. Lenders – especially credit unions and banks involved in direct and indirect auto loans – are grappling with what this means for affordability and risk. Early signs show a surge of buyers racing to beat the deadline followed by an expected sales slump (Reuters). For auto financiers, the loss of upfront incentives isn’t just a sales story; it’s a risk story. Higher vehicle prices and uncertain resale values are colliding with stretched buyer budgets, challenging traditional underwriting models. In this post, we’ll explore how the EV tax credit’s end is affecting prices, payment-to-income ratios, and default exposure, and why real-time income verification (like Verify4) is emerging as a critical tool for lenders in this volatile environment.

Photo by Tom B on Unsplash

Federal EV Rebate Sunset: Sticker Shock and Slumping Demand

The EV tax credit had been a cornerstone of EV affordability for 17 years, helping blunt the higher upfront cost of electric cars. Its expiration on Sept. 30, 2025 was earlier than initially planned (2032) due to new legislation (HR Block). In the rush before the deadline, EV sales spiked – August 2025 saw EV market share hit an all-time high of 11.5% as consumers hurried to lock in credits (InsideEVs). But with the credit gone, demand is expected to fall sharply, effectively making EVs more expensive in real terms. Analysts predict a tumble in EV sales for the final quarter of 2025 now that buyers can no longer count on a rebate (Chase Auto Finance). Automakers are bracing for the fallout: many may respond by cutting prices or offering discounts to stimulate sales, or by throttling back production to prevent oversupply.

Affordability Challenges: Bigger Loans, Longer Terms, Higher Payments

Even before the credit’s demise, EVs came with a premium price tag. In mid-2025 the average transaction price for a new EV was about $57,245, significantly higher than the ~$48,799 average for all new vehicles (Cox Automotive). Now, without a federal rebate to shave off thousands, the affordability gap has widened further. Many buyers will need to either bring more cash up front or, more likely, finance a larger amount. This is pushing borrowers to stretch loan terms and budgets to make monthly payments feasible. In fact, industry data shows that in early 2025 about 1 in 5 new-car buyers committed to a monthly payment of $1,000 or more, up sharply from ~16% a year earlier (Edmunds).

Lenders are already witnessing trends of longer loan terms and shrinking down payments as consumers grapple with high vehicle prices. As of Q2 2025, the average new-car down payment fell to about 13% of the purchase price – well below the traditional 20% recommendation. Meanwhile, seven-year car loans have become increasingly common (over 22% of new loans in 2025, vs 16% the year prior). These strategies help keep monthly payments manageable, but they also mean borrowers stay indebted longer and build equity more slowly. This is especially risky for EVs, which have seen steeper depreciation curves and uncertain resale values compared to conventional cars (Kelley Blue Book).

Crucially, higher PTI ratios signal that borrowers are devoting a larger share of income to their car payment – a key predictor of financial strain. Auto loan delinquencies have been rising in 2025, with nearly 5% of auto loans 90+ days past due according to some measures (Federal Reserve Bank of New York). In April 2025, the auto loan default rate hit an annualized 3.49%, the highest in over a decade (S&P Global).

Photo by Hyundai Motor Group on Unsplash

Loss of Incentives Increases Lender Risk Exposure

Without the rebate, loan-to-value (LTV) ratios on EV loans are rising unless buyers compensate with more cash down. Automakers like GM have already begun tapping the brakes on EV production due to high costs and slower consumer uptake, signaling that long-term EV resale values are in question. The risk of default is compounded by the risk of collateral devaluation: repossessed EVs may fetch far less at auction if values plunge.

Traditional underwriting models are being tested. EVs introduce new uncertainties: battery longevity, software updates, charging infrastructure, and tech obsolescence. Some lenders have already imposed stricter requirements for EV loans, including tighter LTV limits and higher credit score cutoffs (Experian Automotive).

Experts recommend lenders monitor factors like LTV ratios, battery warranties, inventory levels, and regional infrastructure adoption.

Underwriting in the Unknown: Why Real-Time Verification Matters

Auto lending fraud exposure in 2025 is estimated at $9.2 billion, with nearly 69% of that tied to first-party misrepresentation (fake or inflated income and employment claims) (Point Predictive). Up to 30% of applicants exaggerate or falsify income in the loan process.

This is where real-time employment and income verification comes in. Platforms like Verify4 deliver income confirmation in seconds straight from trusted sources, eliminating slow manual checks.

• Speed: Approvals can move from application to funding in near real time, keeping dealers and borrowers engaged.

• Fraud prevention: By cross-checking actual wage data, lenders can stop income inflation before the loan is booked.

• Better underwriting: Fresh, accurate data sharpens PTI and DTI assessments, catching risks that stale documents might miss.

Navigating the EV Lending Shift with Verify4’s Help

The expiration of the EV rebate has raised the stakes for lenders. Bigger loans, uncertain collateral values, and fraud risks mean more precision is needed in underwriting. Real-time verification with Verify4 lets lenders approve faster, with more confidence, and with stronger fraud defenses.

Contact Verify4 to learn how real-time income and employment verification can protect your auto loan portfolio while helping you compete in today’s EV market.

We rolled into Cincinnati with the kind of grounded anticipation you only get after too many red-eye emails. Michael had just powered through an eight-hour drive from Wisconsin, and I limped in at midnight after delays. Normally, we post up at the Hilton Netherland Plaza—classic older American hotel charm (French art deco style with a killer lobby bar), right in the heart of downtown. Naturally, a priority stop had to be Skyline Chili (thanks to our Miami University days for that addiction) in Over the Rhine.

After a few weeks off the road, it felt good to be back. First stop: meeting one of our newest (and largest) credit union partners just outside of Cincy. Conversations landed in that sweet spot where mission meets opportunity. The team at this credit union came prepared with questions. We heard them, and now can process the feedback to improve our solution.

Then came Clermont MHA and their “Implementation Pizza Party.” If carbs aren’t a universal celebration, I don’t know what is. The in-person collaboration had an energy we miss when working remotely—thanks to the pizza, it was as cheesy as it was genuine.

From there, we made our way to Columbus. We’re there often, but this time, instead of staying in a large corporate hotel downtown, we stayed in the German Village—pure charm. Schmidt’s Sausage Haus transported us straight to Oktoberfest with bratwurst and big beer.

The work clicked. Talks moved from ideas to alignment, and we even waded into the kind of slightly uncomfortable, but necessary, ideas that spark real change.

Driving east from Columbus, the road offers its own oddities. Case in point: a massive wicker basket that used to be Longaberger’s global headquarters. It doesn’t look real, but it is. Now we’re eyeballing it for a future Verify4 global headquarters….

We passed through small-town Ohio with its own character reel:

• Zanesville’s Y Bridge—more personality in one zigzag than some metro skylines.

• Coshocton and Dover—quiet towns with loud hearts (and more pizza).

• Akron—prospective customer visits, a possible partner, a hidden gem bourbon bar and pure good times.

• Hudson –an actual German “Bier Garten” in the town square and a delicious carnivorous Farmers Rail for a client team building meeting.

• Cleveland outskirts—home stretch energy, a national park detour, and Geauga County’s beauty on full display.

The miles told a story bigger than Verify4 or any single meeting: small towns, big hearts, and mission fulfillment at every stop.

Why these trips matter (without overstating it)

PowerPoints can’t replace the moment someone’s face changes because they get it—or the instant an idea shatters an old barrier. These trips are about human connections, not just geography. And yes, pizza helps (hint, hint).

At Verify4, our mission is connecting communities by connecting people to their data for their benefit.

If your organization could use our help, reach out at will@verify4.com and schedule a consultation.

So July 1st just rolled around, and the new HOTMA changes are going into effect. But what does it all mean? And how can you best prepare for any new compliance requirements.

Any Public Housing Authority that administers Housing Choice Vouchers and Public Housing must now comply with certain provisions of the Housing Opportunity Through Modernization Act of 2016 (HOTMA). Many of these provisions have already been in effect, but subjected to a grace period.

In a June 16 letter, Todd Thomas, Acting Deputy Assistant Secretary for HUD’s Office of Public Housing and Voucher Programs, reminded all Executive Directors that by July 1 PHAs must: (1) apply the new income exclusions in 24 CFR 5.609(b); (2) use the updated definitions in 24 CFR 5.100, 5.403, and 5.603; and (3) adopt policies addressing de minimis errors.

These changes are also reflected in Notice PIH 2024-38 by HUD, Housing Opportunity Through Modernization Act (HOTMA) Sections 102 and 104: Updated Guidance to Public Housing Agencies (PHAs) on Compliance.

What are the HOTMA changes that went into effect July 1st, 2025?

HOTMA Income Definition Updates

• “Earned income” & “unearned income” (24 CFR 5.100): Used to apply exclusions like 5.609(b)(3) (earned income of children <18) and 5.609(b)(14) (portion of dependent students’ earnings over the deduction).

• “Family” (5.403): Determines basic eligibility for PIH programs; HOTMA expanded which single persons qualify as a “family” to align with the 2021 Consolidated Appropriations Act.

• “Day laborer,” “independent contractor,” “seasonal worker” (5.603): These terms support the nonrecurring income exclusion at 5.609(b)(24).

• “Dependent” (5.603): Clarifies (explicitly) that foster children and foster adults are not part of the assisted family and aren’t counted as dependents—this wasn’t a policy change, just codified. Applies to exclusions at 5.609(b)(14) & (15).

• “Foster child” & “foster adult” (5.603): New definitions; used in exclusions at 5.609(b)(4) & (8) (payments for their care; income of live‑in aides, foster children/adults).

• “Health and medical care expenses” (5.603): Replaces “medical expenses” in exclusions at 5.609(b)(2)(i)(B) and 5.609(b)(6).

• “Minor” (5.603): Tied to the trust distribution exclusion at 5.609(b)(2)(i)(B).

Updated Income Exclusions PHAs must use (24 CFR 5.609(b))

• Imputed return on assets ≤ $50,000 is not counted when no actual asset income can be determined (5.609(b)(1).

• Certain trust distributions from irrevocable/revocable trusts outside the family’s control are excluded (5.609(b)(2)).

• Earned income of dependents under 18 is excluded; only their unearned income counts (5.609(b)(3)).

• Payments for foster children/foster adults (incl. state or Tribal kinship/guardianship payments like Kin-GAP) are excluded (5.609(b)(4) & (8)).

• Insurance payments/settlements for personal or property losses are excluded (5.609(b)(5)).

• Health & medical care reimbursements that offset documented expenses are excluded (5.609(b)(2)(i)(B)).

• Non‑recurring income that will not repeat in the coming year is excluded (5.609(b)(24)).

• Civil rights settlements or judgments are excluded (5.609(b)(25)).

• Gross self‑employment/business receipts are excluded to the extent only net income is counted (clarified at 5.609(b)(24) & (28)).

• Amounts excluded by other federal statutes stay excluded; HUD will maintain the qualifying list (5.609(b)(22)).

De minimis error policy (24 CFR 5.609(c)(4))

• Definition & threshold: A de minimis error is when your income calculation is off by no more than $30 per month in adjusted income (=$360 per year) for a family. You are not considered out of compliance solely because of such an error.

• Who it applies to & where it’s codified: The rule covers PHAs and owners across PH/program regs (24 CFR 5.609(c)(4); 882.515(f); 882.808(i)(5); 960.257(f); 982.516(f)).

• Corrective action requirements:

  • If the family overpaid rent because of the error, you must credit or repay them, retroactive to the effective date of the action.

  • If the family underpaid, HUD says they may not be required to repay the difference.

What This All Means in Simple English

In plain terms, July 1 means PHAs now have to use HUD’s refreshed rulebook for what “counts” as income, what doesn’t, and how to treat small math mistakes. You’ll follow new definitions (so everyone is talking about the same things like “earned income,” “foster child,” or “seasonal worker”), you’ll ignore a longer list of income types that Congress/HUD say shouldn’t raise a family’s rent (like small trust payouts, foster care payments, one‑time windfalls), and you’ll formalize a “de minimis” policy so a $30/month error doesn’t trigger findings or chase-backs from tenants. Practically, this means updating your policies, software, and staff scripts so every recert effective after July 1 applies the new definitions/exclusions automatically—and documenting how you’ll fix tiny errors if they pop up. It’s all about getting to the right rent with less paperwork anxiety: clearer rules, fewer gotchas, and a little grace for honest, minor miscalculations.

How Verify4 is setup to help MHAs

Verify4’s income and employment verification solution is a game change for housing authorities. We help them comply with income calculations faster, with greater accuracy. Best of all, we do it for a fraction of the price compared to other solutions MHAs are used to.

• Level-5 “Up-Front Income Verification” out of the box. Verify4 is the most reliable third-party data match but HUD’s hierarchy definition. Verify4 delivers employer‑reported quarterly wage records straight from state databases—authoritative, FCRA-compliant, and timestamped—so staff aren’t chasing paystubs or employer letters.

• Faster, cleaner annuals and interims. HOTMA wants past-12‑month actual income. With an instant wage history and current quarter data, you can calculate past income, spot 10% shifts for interims, and document everything in seconds.

• Built-in error prevention for the de minimis era. Automated pulls reduce fat-finger math and missing-job errors—the top causes of those <$30 discrepancies. If you do miss something, your audit trail shows good-faith reliance on primary-source data.

Verify4 is the only firm offering real-time, high-coverage income and employment verifications—covering over 93% of employees and 99% of wage data, with up to 25 years of history. It's fast, affordable, and integrates easily into existing systems.

To learn more about how Verify4 can help your organization make smarter, fairer decisions, reach out at will@verify4.com or visit www.Verify4.com

In consumer lending, better data often translates to better decisions. Traditional loan underwriting in the U.S. has long relied on limited snapshots of a borrower’s financial picture – credit scores, a couple of recent pay stubs or tax returns, and basic debt ratios. But what if lenders could zoom out and view a 25-year history of a borrower’s income? Access to such long-term, accurate income data can fundamentally improve risk assessment and loan performance.

Leveraging Long-Term Income Data to Lower Default Rates

A longer income history dramatically improves a lender’s ability to improve their underwriting standards. Think about it. If past performance helps you understand future results, it’s a no brainer. During the 2000s housing boom, for instance, “no income, no job” mortgages saw delinquency/default rates of about 27% – more than double the 11.5% rate of conventional loans that verified income. A long term evaluation paints a new picture on stability. Borrowers with reliable, long-term income streams are far less likely to fall behind on payments, even if their credit scores are modest. FinRegLab’s research on cash-flow underwriting confirms that income and expense metrics can predict default risk with high accuracy, achieving AUROC scores up to 0.725 in ranking borrowers’ likelihood of default. The payoff is measurable: if default rates on a portfolio drop even from 5% to 4% (a 20% reduction) due to better screening, the ROI in avoided charge-offs is substantial. According to Point Predictive, over 40% of loans that defaulted early had signs of inflated income on the application.

Photo by Sean Pollock on Unsplash

From Risk to Reward: Long-Term Insights Transform Loan Pricing

Long-term income data also enables more precise risk-based pricing. In traditional underwriting, lenders often rely on coarse factors (credit score bands, DTI ratios at a point in time) to set interest rates. This can lead to mispricing. Incorporating a 25-year income history changes this dynamic. Stable earners with upward income trajectories can be offered lower rates than the traditional model would allow, winning their business, whereas applicants with erratic incomes might be charged a risk premium or required to strengthen their profile. The net effect is pricing that more closely matches true default risk, boosting portfolio yield. Real-world fintech results bear this out: the AI lending platform Upstart (which built their reputation on alternative data lending) was shown to approve 27% more borrowers than a typical model while charging 16% lower average APR to those approved. In other words, by better assessing risk (including via income and employment patterns), Upstart could offer many borrowers cheaper loans and still reduce risk exposure – a win-win of more volume at lower loss rates. Regulators have recognized this benefit; an interagency statement by the Fed, OCC, and CFPB noted that using alternative data like cash-flow (income and expense streams) “may enable consumers to obtain more favorable pricing/terms based on enhanced assessments of repayment capacity” federalreserve.gov. Long-term income analytics let lenders price loans with surgical precision, increasing profitability per loan and delivering savings to worthy customers.

Optimize CECL Reserves with Accurate Income Verifications

Beyond immediate pricing and defaults, long-horizon income data can optimize how much capital a lender must hold in reserves for expected losses. Under the current CECL accounting standard (Current Expected Credit Loss), banks must estimate lifetime losses for loans upfront, using historical data and forward-looking information. If a bank can identify a segment of borrowers with stable 25-year income profiles that correspond to, say, 30% lower loss rates historically, it can justifiably project lower expected losses for that segment and reduce the allowance for credit losses on those loans. This freeing up of reserve capital improves ROI. Conversely, loans to borrowers with volatile income histories would carry higher reserves, appropriately so. By incorporating long-term income patterns (e.g. how borrowers fared through past recessions or layoffs), lenders can produce “reasonable and supportable forecasts” of credit loss that are far more tailored to each loan. For example, a prime auto loan to a customer with 20+ years continuous employment in a stable industry might justifiably receive a lower loss projection than the average prime loan – translating to a lower reserve percentage. Even a modest reduction in loss reserves (for instance, from 1.5% of loan balances to 1.3%) for a low-risk tier can significantly boost return on equity, especially in high-volume portfolios. Moreover, by broadening the data used in loss modeling, banks reduce uncertainty in their estimates.

Photo by Helena Lopes on Unsplash

Financial Inclusion Starts with Better Employment Verification Data

One of the most exciting ROI impacts of using 25-year income histories is the expansion of approval rates and borrower reach without compromising credit quality. Traditional underwriting often declines applicants who lack a strong credit file or have recent income instability, even if they are actually creditworthy. Long-term income data can fill these gaps and paint a fuller picture of an applicant’s true capacity to repay. Many Americans with thin credit histories (or past credit issues) have stable jobs and consistent incomes that span decades – a strength that would go unnoticed in a standard credit report. By recognizing such patterns, lenders can safely say “yes” more often. Studies by the Urban Institute found that cash-flow data (like income records) could expand mortgage access for borrowers with thin or no credit scores, and even lower default risk for those borrowers. In fact, incorporating indicators like consistent rent and utility payments and steady income inflows was shown to re-approve significant numbers of minority applicants who would otherwise be denied, helping to close approval gaps. In the personal loan space, the earlier example of Upstart illustrates expanded approvals: its model nearly doubled the approval rate for applicants in the 620–660 FICO band, thanks to additional signals like employment history that traditional models overlook. For lenders, the ROI comes from writing more loans to good customers who would have been filtered out by rigid criteria. This means higher interest income and market share, without an adverse hit to losses. Put simply, long-term income analytics allow lenders to lend smarter, not just tighter. For example, a borrower with a middling credit score but who has earned a reliable salary for 25 years in the same profession is a far safer bet than the score suggests – and long-term data will flag that. Lenders using such data have reported not only more approvals, but also that many of these newly approved customers perform well. This expanded capacity can be transformative in mature markets: it allows growth in loan portfolios and fosters customer goodwill by offering credit to those who deserve it.

Verify4 is the only firm offering real-time, high-coverage income and employment verifications—covering over 93% of employees and 99% of wage data, with up to 25 years of history. It's fast, affordable, and integrates easily into existing decision systems

To learn more about how Verify4 can help your organization make smarter, fairer decisions, reach out at will@verify4.com or visit www.Verify4.com

The Consumer Financial Protection Bureau (CFPB) recently revised its estimate of credit invisibility in the U.S., significantly reducing it from about 10% in 2015 to 2.7% in 2025. The CFPB defines "credit invisible" as having no credit record with any of the three major credit bureaus: Experian, TransUnion, or Equifax.

This reduction is largely attributed to newer credit scoring models that now incorporate so-called alternative data—regular payments for utilities, telecommunications, broadband, cable, rent, and other recurring expenses. In addition, the Bureau adjusted its methodology. Notably, in its earlier 2015 estimate, the CFPB acknowledged that records containing only deferred student loans, collections, or closed accounts were inadvertently excluded.

But while the drop appears to be good news, there's more to the story.

The updated data also show that roughly 10% of the population has a credit file but cannot be scored—often due to sparse or stale data, or because all accounts are closed. When you combine these “unscorables” with the credit invisibles, the underserved population remains stubbornly large: about 13% of U.S. adults, or more than 30 million people, are still excluded from full participation in the credit system.

This matters. These individuals are often trapped in the “credit catch-22”—to qualify for credit, you must already have credit. As a result, they face steep barriers to obtaining affordable financing, securing better jobs, or even moving into better housing without excessive deposits.

Some efforts have helped. Scoring models like FICO XD and VantageScore have shown that even a single tradeline—say, a utility or telco bill—can be enough to generate a score. But in practice, these often yield scores in the 600–640 range, qualifying applicants only for subprime, low-limit, high-interest products, like credit builder cards. These are better than nothing—but still far from full financial inclusion.

Despite years of advocacy, Congress has failed to pass the Credit Access and Inclusion Act, which would expand access to alternative data for credit reporting. First introduced by Rep. Mike Castle in 2005, it has been reintroduced repeatedly and even passed the House unanimously—only to stall in the Senate.

So where do we go from here?

This is where income and employment verifications become critical. As a supplement—not a substitute—for credit scores, real-time verifications provide lenders, landlords, and employers with rich, current insights into an applicant’s financial stability. If a person has held steady employment for five years, with rising income and consistent bonuses, that’s powerful information—whether or not they have a full credit file.

Verify4 is the only firm offering real-time, high-coverage income and employment verifications—covering over 93% of employees and 99% of wage data, with up to 25 years of history. It's fast, affordable, and integrates easily into existing decision systems.

To learn more about how Verify4 can help your organization make smarter, fairer decisions, reach out at will@verify4.com or visit www.Verify4.com.

Photo by Lalith sai Thomala on Unsplash

As mission-driven organizations—Metropolitan Housing Authorities (MHAs), Community Banks, and Credit Unions—your roles are crucial in fostering economic independence and stability for the communities you serve. Budgets are tight, and the demands are ever growing. Living in a dynamic world that is flooded with AI, political uncertainty, and rising costs doesn’t make things easier.

At Verify4, we recognize that your ability to empower residents and members hinges on accurate, efficient verification of income and employment. As a Public Benefit Corporation, Verify4 uniquely positions itself as your trusted partner. We help community banks and credit unions support the 1 in 5 Americans who are credit invisible access through better economic opportunities. We help Ohio’s MHAs streamline their operations to qualify tenants for better opportunities.

When we speak with Housing Authorities, the big thing on their minds are the looming threats of budget cuts. Some of the most at risk programs, are tied to Family Self-Sufficiency and Resident Opportunity and Self-Sufficiency programs. An area where credit unions are community banks are well positioned to step in and help.

The Landscape: Understanding FSS and ROSS

HUD administers two complementary programs to promote resident self-sufficiency:

• Family Self-Sufficiency (FSS): Combines personalized case management with an escrow savings account that converts rent increases—driven by income growth—into forced savings. Graduates can receive average payouts of $5,000–$10,000 to support homeownership, education, or entrepreneurship.

• Resident Opportunity and Self-Sufficiency (ROSS): Places Service Coordinators on-site to connect all residents—families, seniors, and those with disabilities—with local services (job training, healthcare, childcare) to build foundational stability.

Comparing FSS and ROSS

Photo by Breno Assis on Unsplash

Funding Risks in Recent Budgets

Recent federal budget proposals have posed existential threats to both programs. (nahro.org) Whether they make it into the final bills, that is still in the air.

FY2026 Budget Proposal:

• Consolidates rental assistance into block grants, threatening the FSS escrow mechanism and local service coordination model. (bipartisanpolicy.org)

• The 2026 Budget does not provide funding for the Self-Sufficiency Programs account, which consists of three programs (Family Self-Sufficiency, Resident Opportunity and Self-Sufficiency, and Jobs-Plus) that predominantly fund salaries of coordinators that connect HUD-assisted residents to services. (Whitehouse.gov)

Housing advocates warn these drastic cuts could force PHAs to slash coordinator staff, and pause enrollments. Congress now has the authority to restore or reject these proposals; advocates like NLIHC are mobilizing to protect essential self-sufficiency funding (nlihc.org).

Why Partnerships Matter: Navigating Fiscal Challenges

Volatility in federal funding isn't just an administrative issue—it affects your residents’ and members' financial stability and overall community trust. Cuts can disrupt programs, halt essential services, and undermine long-term planning.

Verify4 offers a critical advantage here by providing fast, reliable, and comprehensive verification of income and employment. By partnering with us, you streamline administrative processes, reduce manual verification errors, and ensure that financial assistance and loan underwriting decisions remain accurate and timely, regardless of federal budget uncertainties.

Strategic Solutions: Deepening Local Partnerships

To enhance resilience, we recommend leveraging your existing relationships with local credit unions and community banks to create powerful partnerships built around financial literacy, inclusion, and asset-building products:

• Foundational Engagement: Collaborate on financial literacy workshops, bolstering resident and member understanding of budgeting, credit management, and basic banking.

• Integrated Services: Host regular events to offer low-barrier banking solutions, fostering greater financial inclusion and independence.

• Advanced Financial Tools: Jointly develop credit-builder loans and matched savings accounts (Individual Development Accounts - IDAs) to significantly boost asset accumulation and creditworthiness among your residents and members.

How Verify4 Strengthens These Initiatives

Verify4’s income and employment verification solutions significantly amplify the effectiveness of these local partnerships. Both MHAs and community financial institutions are our trusted partners who rely of timely, accurate income verifications. We help with:

• Rapid Verification: Instant, accurate verification means faster, more confident lending decisions and financial support disbursement.

• Application Fraud Reduction: Precise verification reduces application fraud, protecting your resources and maintaining program integrity.

• Cost Efficiency: Streamlined verification processes cut down administrative overhead, freeing up resources to be reinvested in core community programs.

Photo by James Feaver on Unsplash

Real Impact: Transformative Community Outcomes

Imagine seamlessly providing residents the tools they need to transition from subsidized housing to homeownership, supported by accurate verification of employment stability and income growth. Consider the powerful impact of equipping your members with improved credit scores through specialized loans verified swiftly and securely.

Verify4 transforms these possibilities into realities by directly addressing critical verification barriers, enabling you to deliver impactful programs consistently, regardless of federal fiscal volatility.

Want to see how Verify4 can help you strengthen community ties? Reach out to us via email at will@verify4.com to learn more.

A recent national survey of credit unions found that nine in ten executives cited fraud loss as their primary concern for 2025. When asked how they planned to mitigate these risks, 90 percent said they intended to use AI. However, almost none of these executives had prior experience with AI or a clear deployment strategy. But is AI truly the best solution for lenders facing AI-driven fraud?

Consumer lending fraud is accelerating rapidly, largely fueled by fraudsters' increasing use of generative AI. In 2024 alone, U.S. lenders saw a 31% year-over-year increase in synthetic identity fraud. AI-generated fake documents now closely mimic genuine pay stubs and employment records (PwC Fraud Outlook, 2024). The FBI has warned that large language models and deepfake technologies are enabling "fraud at an industrial scale," allowing criminals to generate realistic loan applications that evade traditional detection systems (FBI IC3 Report, 2024).

Photo by Cytonn Photography on Unsplash

Despite the hype, AI-based fraud detection remains reactive, costly, and largely untested against today's sophisticated AI-driven threats. A more effective defense is verified data—specifically, real-time income and employment verification. Platforms such as Verify4 provide instant, direct-from-source data, enabling lenders to validate applicant claims accurately and swiftly. Unlike AI-driven detection tools, Verify4’s data is tamper-proof, cost-effective, and proven to significantly reduce fraud rates across digital lending channels.

In fact, Verify4’s very first commercial use involved detecting potential application fraud. A borrower submitted convincing W2 and 1099 documents, claiming nearly a decade of employment at a local company. Suspicious of the application, the lender used Verify4, which returned no record of the stated employment. Armed with this reliable information, the lender confidently identified and denied the fraudulent application. Verify4’s extensive coverage of W2 workers makes such fraud detection possible.

Bank and credit union executives anxious about fraud might find more value in proven techniques like data verification rather than following the latest AI trends.

Fraudsters increasingly leverage generative AI and deepfakes to open fraudulent credit accounts using synthetic or stolen identities. These techniques, embedded in sophisticated phishing operations, allow criminals to create realistic personas and bypass traditional Know Your Customer (KYC) checks. For instance, AI-generated voice clones and fabricated documents enable scammers to easily pass bank interviews or call center verifications.

The financial repercussions have been severe. Synthetic identity fraud alone cost U.S. financial institutions over $35 billion in 2023, with projected losses reaching $23 billion annually by 2030. Deepfake-enabled scams have further intensified fraud losses, which were estimated at between $12 and $40 billion annually, contributing to total U.S. fraud losses of $158 billion in 2023.

Smaller banks, particularly community and regional institutions, are responding proactively. Many are implementing multilayered AI detection systems to flag anomalies in behavior, documentation, voice, and device attributes. Additionally, they are reinforcing basic fraud controls—like two-factor authentication—and investing in staff training and customer education programs. Specialized toolkits from organizations like the Federal Reserve and the ICBA, as well as consortium partnerships, further assist these institutions in detecting synthetic identities and elder-targeted scams.

Verify4 significantly complements these efforts. By requiring applicants to state their current employer, current wages, and at least one previous employer, lenders can effectively verify identity and credit capacity. Incorporating Verify4 into the application process enables lenders to enhance their KYC procedures by confirming accurate employment history, significantly improving fraud detection and prevention.

While threats continue to evolve, widespread adoption of both AI-enabled defense tools and targeted community outreach are proving essential to minimizing fraud losses, especially among smaller financial institutions. Now is the time to consult with the verification experts at Verify4 to see how they can help protect your firm.

Discover how Verify4's industry-leading verification solutions can transform your business. Contact us today for a demonstration and learn how we can help you lend with greater certainty and security in today's complex digital world.

Sources:

• Conductive Survey – (January to May, 2025). Informal survey. www.conductive.co

• FBI Internet Crime Report, 2024

• PwC Global Economic Crime and Fraud Survey, 2024

• Verify4 Internal Benchmark Report, 2025

The digital revolution in banking and lending has ushered in an era of unparalleled convenience. Yet, beneath this glossy surface of seamless transactions and instant approvals, a shadow pandemic is rapidly spreading: application fraud. This isn't your typical credit card theft; we're talking about a sophisticated assault on the very foundation of digital onboarding, where fraudsters meticulously craft fake identities or hijack legitimate ones to open accounts and secure loans. Cybercriminals, ever adaptable, are strategically shifting their focus. Alarming new research from Visa underscores this dangerous trend, revealing a clear pivot from traditional payment fraud towards exploiting vulnerabilities in digital banking application processes.

The statistics are stark. Visa’s data shows a jaw-dropping 244% year-over-year global increase in digital document forgeries. This single figure is a blaring siren, signaling a critical challenge to the integrity of how financial institutions welcome new customers. The implications are profound. Traditional fraud defenses, often geared towards spotting anomalies after an account is active, are struggling to keep pace with attacks that occur at the point of entry. If criminals see the application stage as the path of least resistance, it’s a clear call for financial institutions to urgently re-evaluate and bolster their front-line defenses. This isn't just about financial loss; it's about maintaining trust in the digital ecosystem.

Visa Sounds the Alarm: Deconstructing Modern Application Fraud

As financial institutions have enthusiastically embraced digital models to enhance customer experience and operational speed, they've inadvertently opened new doors for fraudsters. This is especially true for those aggressively expanding their digital lending portfolios, where the sheer volume and speed of applications can sometimes outstrip the robustness of fraud prevention measures.

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The Fraudster's Advanced Toolkit

The methods employed are increasingly sophisticated and diverse:

• The Epidemic of Digital Document Forgeries: That 244% global surge in forged digital documents is a headline in itself. The ease of access to advanced editing software and illicit services on the dark web means that creating convincing fakes of bank statements, pay stubs, and identification documents is simpler than ever. This directly undermines the traditional reliance on applicant-supplied documentation.

• Artificial Intelligence: A Double-Edged Sword: AI isn't just for the good guys anymore. Visa’s data reveals that deepfakes were implicated in a staggering 40% of biometric fraud attempts in 2024. In the application fraud context, this can mean manipulated images or videos to fool liveness checks during remote ID verification, or even entirely synthetic photo IDs. AI is empowering criminals to generate highly plausible, yet completely fabricated, applicant personas.

• Data Breaches as Ammunition: Criminal networks are systematically weaponizing the colossal amounts of personal information harvested from data breaches. This compromised data is then used to fuel fraudulent applications at an industrial scale. Illicit online marketplaces facilitate the trade of this stolen consumer data, enabling fraudsters to construct convincing false identities across numerous financial platforms simultaneously. This creates a persistent, readily available supply chain for their illicit activities.

Geographic Hotspots and Targeted Documents

The nature and prevalence of application fraud show distinct regional variations. According to Visa, North America and Latin America report average fraud rates of 6.2%. The Asia Pacific region experiences an even higher rate, at 6.9%. In contrast, Europe, Central Europe, the Middle East, and Africa (CEMEA) see lower average rates, around 3.4%.

The types of documents most frequently targeted also differ by location. In North and Latin America, driver's licenses are prime targets. In the Asia Pacific, Indian Tax IDs (like PAN cards) are commonly exploited. For Europe and the CEMEA regions, national identity cards are the fraudsters' preferred documents. This geographical specificity indicates that criminal enterprises are not using a one-size-fits-all strategy but are astutely adapting their methods based on local norms and perceived weaknesses in verification processes.

The Hidden Cost: Undetected Fraud Masquerading as Credit Loss

Perhaps one of the most critical findings from Visa is the struggle financial institutions face in detecting the true volume of application fraud. A significant portion of this undetected fraudulent activity is often absorbed into standard credit risk provisions and written off as bad debt, rather than being accurately identified and categorized as fraud. This misclassification has severe consequences: it obscures the actual scale of the application fraud problem, leading to an underestimation of its financial impact and, crucially, hindering the development of effective, targeted risk management strategies. When fraud losses are mistakenly bundled with general credit losses, institutions are essentially misdiagnosing a major financial hemorrhage.

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The Domino Effect: Far-Reaching Impacts of Unchecked Application Fraud

The consequences of application fraud ripple far beyond immediate financial write-offs, creating a cascade of negative impacts across a financial institution's operations, reputation, and strategic ambitions.

• Skyrocketing Credit Losses: The most direct hit is the inflation of credit losses when application fraud slips through the cracks. These aren't just numbers on a spreadsheet; they directly erode profitability and can necessitate larger bad debt provisions, tying up capital that could fuel growth.

• Mounting Operational Overheads: The surge in digital lending, if not matched by robust fraud defenses, creates immense due diligence challenges. Every fraudulent application, even if eventually caught, consumes precious resources – manual reviews, investigations, and dispute resolution all drive up operational costs.

• Erosion of Customer Trust and Reputational Harm: If an institution gains a reputation for high fraud levels, or if legitimate customers face excessive friction due to poorly implemented controls, confidence plummets. Robust fraud protection is a cornerstone of customer trust and loyalty.

• Stifling Innovation and Straight-Through Processing (STP): A core promise of digital banking is seamless, rapid service via STP. Application fraud directly undermines this. More suspicious applications mean more manual interventions, slowing everything down and diminishing the ROI from digital transformation. This can create a vicious cycle where fear of fraud leads to more cumbersome checks, negating digitalization's benefits.

Verify4: Your Shield in the Fight Against Digital Deception

The escalating sophistication of application fraud demands a paradigm shift. Reactive measures and reliance on potentially compromised applicant-supplied information are no longer enough. The new imperative is proactive, data-driven verification at the source of truth. This is precisely where Verify4 steps in.

Our core mission at Verify4 is clear: "Enabling opportunity—Verify4 helps qualify people for better jobs, fairer credit, and improved living situations." We believe in making lending fairer and more efficient by giving individuals greater control over their own information. This commitment is backed by our status as a regulated entity under the Fair Credit Reporting Act (FCRA) and as a Public Benefit Corporation (PBC), founded in 2019. These designations underscore our adherence to stringent standards for data accuracy, security, consumer rights, and our dedication to financial inclusion.

Our value proposition is built on delivering "Better Data, Faster Process, Lower Cost" through our specialized income and employment verification solutions.

How Verify4 Directly Counters the Tactics of Application Fraud:

1. Neutralizing Document Forgery with Verified, Employer-Reported Data:

   Visa’s stark warning about the 244% surge in digital document forgeries highlights a massive vulnerability. Applicant-supplied documents like pay stubs or employment letters are prime targets for fakes. Verify4’s Wage Verification and Employment Verification services provide a powerful antidote by largely bypassing these risky documents. We enable lenders to "access verified employer reported wage data quickly and securely." This data comes directly from employers – not the applicant – making it inherently more reliable. We can verify crucial details like "gross quarterly wages, employer information, estimated start/end dates." Consumers are able to provide "up to 25 years digital wage history instantly," making it exceedingly difficult for fraudsters to fabricate a consistent, long-term fake employment and income record.

2. Enhancing Accuracy, Exposing Inconsistencies, and Uncovering Hidden Risks:

   Fraudsters thrive on creating synthetic identities or subtly altering breached data. Verify4’s system is engineered to maximize accuracy and flag discrepancies. Our reported "high hit rate means fewer manual verifications saving time and money." More importantly, a high hit rate against trusted, verified data sources ensures more applications are cross-referenced against reliable information, significantly increasing the chances of identifying inconsistencies. By meticulously verifying data points, Verify4 empowers you to spot critical inconsistencies between an applicant's claims and verified records.

3. Streamlining Due Diligence and Powering Straight-Through Processing (STP):

   Visa noted that mounting due diligence, often due to fraud fears, hampers STP systems. Verify4 is built for speed and efficiency. We "deliver wage verification in seconds," which is vital for maintaining momentum in digital onboarding and achieving STP objectives. By automating critical income and employment confirmation, Verify4 "reduces manual processes," freeing up your team to focus on genuine high-risk exceptions. Furthermore, our products allows Verify4 to be easily incorporated into your existing systems and workflows, enhancing your capabilities without requiring a complete overhaul.

The Verify4 Advantage: A Multiplier Effect Beyond Fraud Mitigation

Adopting Verify4 delivers benefits that extend far beyond just stopping fraud. It’s a strategic enabler.

• Driving Operational Efficiency and Slashing Costs:

  Verify4 "reduces manual processes and minimizes fraud/errors," directly saving time and money. Faster verification (seconds not days) means quicker loan decisions, improving turnaround times and allowing you to process more applications with existing resources. This efficiency helps you "approve more loans" and "speed the lending process," whether for Auto Lending, Consumer Lending, or Mortgage Loans.

• Championing Financial Inclusion and Fairer Lending:

  A core part of our identity is our commitment to financial inclusion. We play a crucial role in addressing the challenges faced by the estimated "52 million credit invisible or unscorable" individuals in the U.S. For this significant group, traditional credit models often fall short. By providing verified income and employment data, Verify4 allows you to assess these individuals based on their actual ability to repay, rather than just a potentially thin credit file. This can help "reduce the 'uncertainty fees' paid by millions of borrowers."

• Enhancing the Customer Experience (CX):

  While our direct focus is verification, the CX benefits are clear. Faster, more accurate, and less intrusive processes inherently improve the applicant's journey. Reducing reliance on manual document uploads and review delays creates a smoother, modern onboarding experience, which is key to building trust and loyalty.

• Supporting Diverse Lending and Screening Portfolios:

  The versatility of Verify4’s solutions means you can strengthen application processes across a wide array of products, including industries, applying a consistent, robust standard across your entire portfolio.

Photo by Neil Martin on Unsplash

Fortify Your Digital Gates – Partner with Verify4

The digital frontier, while full of promise, is also rife with evolving threats. Warnings about the surge in application fraud, especially the rise in digital document forgeries and AI-driven attacks, are a clear call to action.

Verify4 offers a strategic partnership to fortify your digital defenses. We provide direct, near real-time access to verified employer-reported wage and employment data, fundamentally bypassing the risks of applicant-supplied documents. Our speed, coverage, and security, combined with our commitment to financial inclusion and operational efficiency, make us an indispensable ally.

Failing to adapt to these sophisticated threats means risking not just financial loss, but also a potential weakening of the entire credit ecosystem. Verify4 offers a robust pathway to maintain integrity and confidence.

Is your institution truly prepared for the escalating tide of application fraud? Don't let undetected fraud erode profits, damage trust, and stifle innovation.

Discover how Verify4's industry-leading verification solutions can transform your business. Contact us today for a demonstration and learn how we can help you lend with greater certainty and security in today's complex digital world.

The economic landscape is a dynamic force, constantly shifting and presenting new challenges and opportunities for financial institutions. For credit unions, understanding these shifts isn't just an academic exercise; it's crucial for shaping lending strategies, managing risk, and fulfilling the mission of serving members. As we look ahead, a careful analysis of the latest economic forecasts reveals key trends that will significantly impact credit union lending.

So, what should credit union leaders and loan officers be paying attention to?

The Current Climate: A Mixed Bag of Signals

Before diving into forecasts, let's briefly acknowledge the current economic environment. We've seen persistent (though moderating) inflation, interest rates that have remained higher than in previous years, and a generally resilient job market. Consumer spending has held up, but there are signs of caution among households, with credit card balances rising and savings rates normalizing. This mixed bag sets the stage for what’s to come.

Photo by Jorge Salvador on Unsplash

Key Economic Forecasts and Their Impact on Lending

Here’s a breakdown of what the latest projections suggest and what it means for your credit union's loan portfolio:

1. Interest Rate Trajectory: The Fed's Next Move

The Forecast: Most economists anticipate a period of stable or slightly declining interest rates in the latter half of the year, although the path is highly dependent on inflation data. Aggressive rate cuts are less likely unless there's a significant economic downturn. As of May 2025, the Federal Reserve has maintained the federal funds rate at 4.25%–4.5%, citing persistent inflation concerns and economic uncertainties stemming from recent tariff implementations. The Fed’s staff economists have revised down their economic growth forecasts for 2025 and projected a substantial weakening in the labor market, with elevated unemployment persisting through 2027. 

Impact on Lending:

• Mortgages & Auto Loans: Stable or slightly lower rates could stimulate demand for fixed-rate mortgages and auto loans, making financing more affordable for members. Credit unions should be ready to capture this demand.

•  Personal Loans/HELOCs: Variable-rate products might see increased interest as members seek relief from high-interest debt or look to consolidate.

• Net Interest Margin (NIM): Credit unions will need to carefully manage deposit rates to protect NIM, balancing member value with profitability.

2. Inflation's Grip: Easing but Not Gone

The Forecast: Inflation is expected to continue its downward trend, but likely to remain above the Federal Reserve's 2% target for some time. Supply chain improvements and cooling demand are helping, but geopolitical events could introduce volatility. Goldman Sachs predicts that recent tariffs will cause only a temporary increase in inflation, alleviating concerns of a repeat of the high inflation seen in 2022. 

Impact on Lending:

• Loan Affordability: Persistently higher prices for goods and services can squeeze household budgets, impacting members' ability to take on new debt or make timely payments on existing loans.

• Default Risk: For lower-income members, inflation can exacerbate financial stress, potentially leading to higher delinquency rates. Robust income and expense verification becomes even more critical.

• Operational Costs: Credit unions also face inflationary pressures on their own operational costs, which can indirectly affect lending capacity and pricing.

3. Consumer Spending & Savings: The Shifting Tides

The Forecast: While consumer spending has been robust, forecasts suggest a gradual deceleration as excess savings from the pandemic era diminish and higher interest rates take their toll. Retail sales growth in the U.S. is expected to slow in 2025, as consumer confidence is dampened by persistent inflation and concerns over new tariffs. 

Impact on Lending:

• Demand for Discretionary Loans: Demand for recreational vehicle loans, personal loans for major purchases, and even credit card utilization might soften.

• Focus on Essential Needs: Members might prioritize loans for essential items like home repairs, medical expenses, or debt consolidation, creating opportunities for targeted products.

• Delinquencies: As personal financial cushions shrink, credit unions could see an uptick in delinquencies across various loan types. Proactive member support and financial counseling will be key.

4. Job Market Strength: The Foundation of Repayment

The Forecast: The job market is projected to remain relatively strong, with unemployment rates holding steady or only modestly increasing. However, some sectors may experience headwinds.

Impact on Lending:

• Credit Quality: A healthy job market is generally positive for loan performance, as steady employment provides the income necessary for repayment.

• Underwriting Focus: While the overall picture is positive, credit unions should remain diligent in their underwriting, especially for members in potentially vulnerable industries or those with less stable employment histories.

Photo by Adam Winger on Unsplash

Strategies for Credit Unions to Thrive

In light of these forecasts, credit unions should consider the following strategic adjustments:

Refine Underwriting & Risk Management: Double down on robust underwriting practices. Leverage advanced data analytics and real-time income verification to gain a clearer, more accurate picture of a borrower's true capacity to repay, mitigating potential default risks in a tighter economic environment.
Diversify Loan Portfolios: While mortgages and auto loans remain core, explore other product lines that align with member needs in varying economic conditions, such as debt consolidation loans, home equity lines of credit, or small business loans.
Emphasize Member Financial Health: Offer financial counseling, budgeting tools, and flexible loan terms. Helping members navigate economic stress not only reinforces your mission but also protects your portfolio.
Leverage Technology: Invest in technologies that provide deeper insights into market trends, member behavior, and loan performance. Digital platforms can also streamline the lending process, making it more efficient and accessible for members.
Stay Agile and Informed: The economic outlook can change rapidly. Regularly review economic indicators, adjust your lending strategies proactively, and communicate openly with your members about the resources available to them.

In today’s unpredictable economic environment, confidence in your lending decisions begins with better data and deeper member insight. Verify4 empowers credit unions to navigate change by providing real-time income and employment verification—reducing fraud, improving risk management, and supporting your mission to serve members responsibly.

Ready to strengthen your lending strategy and member relationships?

Learn more about how Verify4 can help your credit union thrive in any market. Contact us or schedule a demo today.

Consumer Credit at a Turning Point

U.S. lenders, particularly credit unions and community banks, are facing a significant shift in the consumer credit landscape. Late-stage delinquencies are rising rapidly, largely driven by increased inflation, the recent reinstatement of student loan payments after years of hiatus, and stagnant wage growth. This trend has brought the average U.S. credit score down to 701, its first notable dip in nearly a year, due to heightened financial pressures, especially impacting auto loans and credit cards. Students coming out of school today are at a significant disadvantage, and there is little sign of any easing up for them.

Photo by Towfiqu barbhuiya on Unsplash

Rising Late-Stage Delinquencies: Key Trends

Recent data from VantageScore’s February 2025 CreditGauge report indicates that late-stage delinquency rates (90+ days overdue) more than doubled from 0.20% to 0.45%. Such sharp increases are at their highest level in five years, reflecting a broader trend of financial distress among consumers. Two primary factors driving this uptick:

• Resumption of student loan payments after a prolonged pause.

• Increasing auto loan delinquencies, influenced by higher interest rates and inflated vehicle prices.

For credit unions, traditionally proud of strong borrower relationships and low default rates, this signals a critical moment requiring proactive risk management.

Student Loan Payments Return: A Major Stress Factor

The reinstatement of federal student loan payments in late 2023 has been particularly impactful:

• Approximately 22 million borrowers had student loans reinstated.

• 43% of these borrowers—about 9.2 million people—were delinquent as of February 2025.

This massive scale of student loan delinquency is unprecedented, potentially lowering affected consumers' credit scores by up to 129 points. While borrowers maintaining payments see slight score improvements, the broader trend remains negative, with an expected national credit score drop to 700 by mid-2025. Now with the federal government beginning collections on student loan debts, consumers are beginning to panic more and more about the future tradeoffs they must make.

Photo by Jorge Zapata on Unsplash

Spillover Effects: Auto Loans and Credit Cards Impacted

The financial strain from renewed student loan obligations is creating noticeable spillover effects:

• Auto Loans: Delinquencies increased significantly across all categories (30+, 60+, 90+ days). Borrowers are prioritizing student loan and credit card payments over car loans.

• Credit Cards: Delinquencies are climbing steadily, reaching the highest loss levels since 2010. Credit card originations are declining as borrowers reduce new credit usage.

These interconnected stresses underscore the need for lenders to closely monitor and reassess portfolio resilience. On top of that, lenders are reporting a rise in consumers simply abandoning car loans. If the car has a mechanical issue that can't be fixed, consumers will simply let their lenders repo a broken car. This is a problem we have been seeing time and time again from our customers.

Underwriting in a Softening Credit Environment

With borrower risk profiles changing rapidly, financial institutions must recalibrate underwriting practices:

• Include student loan obligations explicitly in debt-to-income (DTI) calculations.

• Update risk models to reflect current conditions, tightening income and employment verification standards and adjusting risk thresholds.

• Proactively offer loan modification programs to manage emerging borrower distress, reducing the likelihood of defaults.

Photo by Annie Spratt on Unsplash

Real-Time Income & Employment Verification: Essential for Lenders

As traditional credit metrics become less predictive, real-time income and employment verification emerges as critical:

• Accurate assessment of borrower capacity, reducing reliance on outdated information.

• Enhanced fraud prevention, addressing the significant risks of income misrepresentation and document forgery.

• Modernization of legacy practices, streamlining approvals and improving accuracy and efficiency in underwriting.

Adopting digital verification tools not only reduces risk but also helps maintain responsible and inclusive lending practices.

Practical Steps for Credit Unions and Community Lenders

To navigate this evolving landscape, lenders should consider the following actionable steps:

1. Segment Portfolio Risk: Identify and closely monitor borrowers heavily impacted by student loan repayments.

2. Proactive Borrower Outreach: Communicate early with at-risk members, offering refinancing options and hardship programs.

3. Implement Real-Time Verification: Incorporate modern verification technology into loan application processes to ensure reliable borrower data.

4. Review Underwriting Policies: Adjust score thresholds and integrate explicit student loan payment data into underwriting.

5. Strengthen Portfolio Monitoring: Enhance early-warning systems and reserve calculations to prepare for increased defaults.

6. Promote Financial Counseling: Provide resources and counseling to help members better manage new financial realities.

7. Modernize Lending Technology: Adopt digital platforms to improve borrower experiences and operational efficiency.

Preparing for Future Credit Trends

The resurgence of student loan payments and the rise in late-stage delinquencies present clear challenges. However, with strategic foresight, proactive management, and technology-driven solutions, credit unions and community lenders can effectively navigate these complexities. By emphasizing responsible lending practices and employing real-time data insights, lenders can continue to support their communities even amid economic uncertainty.

Through prudent, proactive steps, lenders can successfully manage risk, uphold strong member relationships, and position themselves for resilience and growth in a changing credit environment. To learn more about how enhancing income verifications can help, let’s chat. Email me at will@verify4.com to discuss further.

We’ve had the privilege to travel across Ohio, and I have to say—the Lake Region is truly one of the state’s hidden gems. It’s an incredible mix: peaceful countrysides, bustling tourist attractions, vibrant city centers, fascinating abandoned malls, and spectacular golf courses designed by legends of the sport.

But honestly, the best part of this journey has always been meeting and speaking with all of you. Our mission at Verify4—to empower individuals by giving them direct access to their own data—is something that genuinely resonates, especially in your communities. It’s heartening to see the passion and dedication you all bring to the work you do every day.

Murphy’s Law is Defiantly Real

Planes, Trains, and Automobiles (1987)

Picture this: Michael and I are sitting in a Denny’s restaurant, trying to quickly prep for an important meeting while nursing my third cup of coffee. I glanced at my phone, and my heart sinks—there’s an email from the prospect asking politely, “Are you close?” You realize you're already 20 minutes late. Panic sets in as Michael grabbed his half-eaten bagel, gather my scattered notes, and sprinted to the rental car like a scene straight out of Planes, Trains, and Automobiles.

Juggling our breakfast and coffee while fumbling for keys, we finally get the engine running and dash through traffic, hoping Google Maps won't lead us astray (it did). Somehow, despite the chaos, we managed to arrive—albeit slightly disheveled but thankfully in one piece, smiling and ready to engage.

Just goes to show when you start a week off with a low, it only can get better from there.

Connecting in Huron with Ohio’s Metropolitan Housing Industry

Our trip to the OHAC Conference at Sawmill Creek Resort—tucked right on the shores of Lake Erie near Cedar Point—was one for the books. The setting was beautiful, no doubt, but what made the experience memorable were the conversations and connections we shared with so many of you who are on the frontlines of housing in Ohio.

We met with directors managing multi-county programs and staff from small but mighty agencies doing heroic work with limited resources. What stood out in every conversation was the shared drive to serve residents, despite the headwinds. Whether it was discussions about shrinking HUD allocations or creative ways you’re stretching operational capacity, your dedication to doing the work the right way never wavered.

Your commitment to helping residents qualify for housing, grow towards self-sufficiency, and improve their lives was inspiring. We heard loud and clear about the significant impacts HUD funding cuts are having on your regional offices and how these cuts directly affect your ability to serve your residents.

We know as housing authorities, you want to stay true to your missions. We do as well. Our mission is to give individuals access to their data, for their benefit. We help “credit invisibles,” qualify for better housing opportunities across the board.

Our network of credit unions and CDFIs stretches deep into Ohio’s rural counties, and that reach is intentional. When you send someone through our system, you're giving them a leg up with community lenders who care about responsible, inclusive growth—not just numbers on a spreadsheet. And that creates a flywheel: less friction for your team, better outcomes for your residents, and more success stories coming out of your programs.

And hey, a huge thank you to Don for hosting the hospitality suite—it completely exceeded our expectations. That kind of exchange is exactly what our roadshow is about.

We left Huron more energized than when we arrived. Thank you for showing up, for sharing openly, and for keeping your sleeves rolled up. We see you—and we're ready to work alongside you.

Addressing Your Challenges

Let’s be honest—what you’re facing right now isn’t easy. Between new regulations, tightening budgets, staffing challenges, and growing operational demands, the weight you carry each day is significant. These aren’t abstract policy shifts—they're very real pressures impacting your teams, your residents, and your mission.

At Verify4, we’re not just here to check a box. We’ve built our verification solution with your needs in mind—budget-friendly, fast to implement, and flexible enough to fit seamlessly into your processes. Whether you’re a large MHA or a team of two doing the work of ten, we aim to take one thing off your plate and help you keep serving your community with confidence and clarity.

What we offer isn’t just a income verification tool; it’s a way to simplify how you comply with new regulations, reduce manual work, and make your limited resources go farther. MHAs use Verify4 to lighten the burden on their budgets, speed up processing, and help families become more self sufficient.

Of course, Sawmill Creek's Fazio-designed course provided a little breathing room—those rolling greens were something special—but it was the honest conversations off the fairway that really mattered. The stories, the frustrations, the moments of hope you shared—that’s what drives us to do better.

We’re here for the long haul. You’ve got enough on your plate, and we’re committed to making at least one part of your workday a little easier. If you are interested in learning more about how we can help, send us an email at will@verify4.com to get in touch.

We’re taking a quick break from our usual content to give you an inside look at what’s been keeping us busy lately.

Last week, Michael and I had the pleasure of attending the Ohio Credit Union League’s annual conference, Invest48. We want to extend our sincere gratitude to Navatros for inviting us to participate as one of your premier partners at the show. With over 400 credit union leaders from across Ohio in attendance, we had the opportunity to showcase our unique approach to income and employment verification—a critical tool in today’s evolving lending environment.

As for extracurriculars, I had the fortune (or misfortune) of participating in the Live Kentucky Derby Race—complete with human and inflatable hobby horses. If you have photos or videos… please delete them. Michael will probably be calling you soon to ensure they live on in infamy.

Can you guess Michael’s favorite football team from our colors?

If you missed Dr. Michael Turner’s Cooperative Lounge presentation, no worries—stay tuned for an upcoming webinar with Navatros and the League, where we’ll recap the discussion and dive deeper into our shared vision.

7% Annual Growth is the North Star

Across the board, credit union leaders at the event underscored a unified goal: achieving 7% annual growth. This figure isn’t just aspirational—it’s directional. It reflects a desire to maintain relevance and resiliency in a tightening lending environment, where market share is increasingly contested by digital-first lenders and aggressive bank competitors. Meeting this benchmark will depend not just on loan volume, but on strategic underwriting, data-informed decisions, and efficient verification workflows that reduce friction for both the institution and the member. Many attendees recognized that hitting 7% year-over-year growth means upgrading core processes while staying grounded in the credit union mission.

Auto Loans Continue to Be a Strategic Pillar

One of the clearest themes to emerge was the enduring importance of auto loans in the strategic roadmap of credit unions. While interest rates and delinquencies have recently tempered growth, the long-term value of auto lending as a member acquisition tool—and a profitability driver—remains strong. Indirect auto lending was frequently cited as both a challenge and an opportunity: credit unions are re-evaluating how they can win more deals at the dealership, serve deeper into the credit spectrum, and deliver faster funding decisions. Investing in verification tools and automation that de-risk these decisions was viewed as essential to maintaining a competitive edge, particularly in micro markets and rural areas where credit unions often lead.

Overcoming Inertia Is the Biggest Challenge

Perhaps the most candid insight shared at the event was this: inertia, not innovation, is the toughest barrier to progress. While technology is available, and the desire for change is growing, many credit unions acknowledged the internal friction that slows down adoption. From entrenched workflows to risk-averse cultures, the path to transformation often stalls not because the solution isn’t right—but because the organization isn’t fully aligned to implement it. Breaking through this inertia requires not just better tools, but also better partnerships—ones that simplify integration, clarify ROI, and provide change management support to help teams move forward confidently. Those who can overcome this friction first will lead the next wave of growth.

This Week in Huron: Ohio’s Metropolitan Housing Conference

One of the most meaningful parts of working for a mission-driven organization is partnering with groups where we can make an outsized impact. That’s exactly the case with Ohio’s Metropolitan Housing Authorities, who are facing increased oversight and operating under extreme resource constraints. These are some of the most dedicated professionals in public service—and we’re proud to support their work.

This week, we’re in Huron, OH from April 30 to May 2 for the OHAC Spring Conference, hosted by Ohio’s Affordable Housing trade association. We’re excited about this partnership because it’s rooted in shared values: mission alignment, support for credit-invisible residents, and a mutual commitment to process efficiency in a chronically underfunded space. Many of these housing providers are in urgent need of tools that can save them time, reduce manual processes, and help their residents qualify for better housing opportunities.

If you’re attending OHAC this week, stop by our booth in the exhibit area—we’re always excited to connect and share ideas. Don’t be shy—come say hi!

We heard your feedback—Verify4 now integrates seamlessly with DocuSign.

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With Invest48 coming up, we thought it would be a good time to touch on some of the challenges we have been hearing from Credit Unions. Ohio’s credit unions serve over 3 million members, from big cities like Columbus and Cleveland to rural communities according to the Ohio Credit Union League. They offer a local, personal touch that inspires trust – but in today’s fast-paced financial landscape, members also demand the convenience and speed found at big banks as credit unions grapple with their own digital transformation efforts. This puts Ohio credit unions of all sizes at a crossroads: how to preserve their community-focused service while overcoming modern challenges. While Credit Unions have experimented with services such as Equifax: TWN, we hear time after time again that is has become too cost prohibitive for regular use. Below, we explore key pain points facing Ohio’s credit unions in each area and how income and employment verification solutions (like the Verify4 platform) can deliver meaningful improvements by streamlining workflows, reducing friction, and improving trust and decision-making. Oftentimes, the best solution is a straight forward digital upgrade, without the extra bells and whistles that typically come attached with other income verifications tools on the market.

Consumer Loan Processing: Speeding Up Auto, Personal, and HELOC Lending

Ohio credit unions have long been strong lenders – for example, auto lending has been a bright spot, with Ohio credit unions’ loan portfolios growing rapidly as they partner with local auto dealers, adding tens of thousands of members in coming years. But as consumer demand rebounds, credit unions face pressure to process loans faster and more efficiently. Members applying for auto loans, personal loans, or home equity lines of credit (HELOCs) expect near-instant decisions, akin to what online lenders or dealerships can offer. The traditional process of collecting paystubs, W-2s, and other documents to verify income slows down loan approvals and frustrates applicants. Every extra day waiting for verification is a day the borrower might go elsewhere for credit.

Many Ohio credit unions still rely on manual income and employment verification when underwriting consumer loans. Loan officers or underwriters must chase down pay documents and phone employers to confirm details – a time-consuming process that can introduce errors. One major pain point is the lack of real-time data; lenders often deal with fragmented data sources and outdated information, making it hard to make confident lending decisions quickly. This not only delays approvals but can lead to application abandonment if the process drags on too long. There’s also a risk element: without thorough verification, borrowers might overstate income or even submit fake paystubs to qualify for loans they can’t truly afford. (Alarmingly, industry research finds about 1 in 10 paystubs that lenders receive are forged as Fake Paystubs Drain Billions from Lenders).

A modern income and employment verification platform like Verify4 can transform loan processing. By connecting directly to state data, these tools allow credit unions to instantly validate a borrower’s income and job status – often in seconds rather than days. For the member, this means less hunting down documents or waiting on HR for confirmation. For the credit union, it means better data for better decisions: up-to-date, trustworthy income information that provides a clear view of the member’s capacity to pay. This speeds up the approval process and removes friction, so loans that used to take days to underwrite can potentially be decisioned on the same day.

These platforms are also flexible across loan types – whether it’s an auto loan, a personal loan, a credit card, or a HELOC, the verification process can be unified and streamlined. That consistency improves operational efficiency and ensures every borrower gets a smooth, seamless experience no matter what product they’re applying for. Ultimately, faster loan processing not only makes members happier, it also allows Ohio credit unions to book more loans with confidence, driving growth while managing risk.

Remove frictions in the digital economy

Winning a new member is only half the battle – the other half is getting them onboarded smoothly. In Ohio, credit unions ranging from large institutions in metropolitan areas to small community charters are all investing in digital account opening to broaden their reach. Many Ohio credit unions have expanded beyond their immediate locales. Whether a credit union’s field of membership is community-based or tied to select employers, the initial account opening experience sets the tone for the member’s relationship.

A primary challenge is onboarding speed and simplicity. Today’s consumers – accustomed to one-click purchases and app-based services. In fact, research shows that if an online account opening process takes more than about 5 minutes, many potential members will abandon it. If they hit too many roadblocks (too many forms, document uploads, or waiting periods), they lose confidence and may give up or turn to a competitor. Furthermore, some credit unions have specific eligibility requirements (like employer or community affiliation); verifying those manually (e.g. asking for an employee ID or residency proof) can add friction if not handled digitally.

Risk Mitigation: Fighting Identity and Application Fraud in the Digital Era

Unfortunately, income and employment misrepresentation has become more rampant – Point Predictive’s research shows it accounted for nearly half of all auto loan fraud losses ($3.6 billion) in 2023. This type of fraud isn’t just about losing money on bad loans; it also means higher default rates and charge-offs, which ultimately hurt the credit union’s financial health and even its honest members. The traditional verification tools have struggled to keep up, or gotten too expensive. Manual checks of paystubs can be foiled by high-quality forgeries (with roughly 10% of submitted paystubs being bogus on average). Fraud rings even set up phony employers and “answering services” to confirm fake employment if someone calls to verify. All of this is compounded by the fact that legitimate data sources are limited – the big centralized employment databases (like those traditionally used for verification) only cover about 30-45% of applicants in many cases, leaving more than half of applicants where the lender has to fall back on riskier methods like manual document review.

Verify4 is a game-changer for risk mitigation. We tackle the problem on multiple fronts. First, by providing real-time access to authoritative income and employment data, we close the gaps that fraudsters exploit. Instead of taking an applicant’s paystub at face value (which might be a fake created in 90 seconds on any of the 12,000+ fake paystub websites), a credit union can use Verify4 instantly check the applicant’s stated employment against government records. For example, an investigative report found thousands of loan applications listing a small computer store in Baltimore as the employer – a completely fake setup where the “company” would vouch for bogus employment in exchange for cash. If someone claims to work at a company and earn $80,000/year, the verification system can confirm within seconds whether that matches the employer’s records. This makes it extremely hard for a bad actor to succeed, because a fake employer won’t show up in the verified data and a fake paystub won’t reconcile with real income data. Essentially, it turns the lights on in what used to be a blind spot.

Member Experience and Retention: Earning Loyalty Through Convenience and Trust

Photo by lauren lulu taylor on Unsplash

Ohio’s credit unions have a proud history of member service – many were founded to serve specific communities or workplaces and earned loyalty through personal relationships. But today, member experience is just as much about digital interactions as in-branch service. From applying for a loan on a smartphone to getting immediate answers about an account, members expect their credit union to deliver speed, ease, and consistency. If not, even long-time members might drift to competitors offering a slicker experience. Retention in the digital age hinges on meeting members where they are and removing pain points from every interaction.

One key challenge is meeting the high bar set by consumer tech giants. Members now compare their credit union’s processes to Amazon’s one-click checkout or Apple’s FaceID login – experiences that feel instant and effortless. Verify4 keeps consumers in the drivers seat in under 2 clicks. Other consumer permission solutions can require 13 clicks or more. When a process at the credit union is clunky – say, a loan application that requires printing and scanning forms, or an account update that needs an in-person visit – it creates friction that members remember. Over time, too many of these friction points can erode a member’s willingness to keep accounts or loans at the credit union, no matter how good the rates are. The same is true for existing members: a survey by Deloitte found that lengthy processes cause drop-off, can lead many to quit mid-process. In a world of short attention spans, every extra step or second of delay matters.

Additionally, Ohio credit unions serve diverse demographics – from tech-savvy young adults in Columbus to retirees in small towns. Catering to all can be tough. The younger crowd might leave if mobile app features are lacking, while older members might leave if they feel services aren’t tailored to their needs. A consistent factor across demographics, however, is that nobody likes redundant paperwork, clunky logins, or uncertainty. Members also want to feel known and trusted by their credit union, not treated like a stranger each time they apply for a new product. This kind of responsiveness builds trust and goodwill. Members feel “my credit union knows me and values my time.”

In fact, some credit unions report that offering fast, low-friction service becomes a word-of-mouth advantage. When members have an easy time opening accounts, getting loans, and solving issues, they’re more likely to refer family and friends – turning great experience into organic growth. Verification tools contribute by removing the traditional pain points (no more “I’m waiting to hear back on my loan” or “They keep asking me for more paperwork”). Instead, members get quick answers and outcomes.

Moreover, a modern verification platform can enable more personalized service, which is key to retention. For example, if the verification data shows a member’s income has increased since they joined, the credit union might proactively offer them a higher credit line – demonstrating attentiveness. These kinds of touches deepen the relationship. They show that the credit union is not just transacting with the member but is truly their financial partner.

Operational Efficiency and Staffing: Doing More with Less in Ohio’s Credit Unions

It’s no secret that many credit unions operate with lean teams – especially smaller community institutions. In Ohio, where there are dozens of credit unions serving local populations, resources can be tight. One recurring theme heard among Ohio credit union executives is staffing challenges: an inability to fill open positions or find people with the right skills for specialized roles. Staffing constraints became even more pronounced after the pandemic and in the face of a tight labor market. At the same time, operational workloads (from regulatory compliance to handling increased loan volumes) have grown. Credit unions are expected to “do more with less,” finding ways to maintain excellent service and prudent operations despite limited human resources.

Credit union employees often wear multiple hats – an underwriter might also handle member service calls, or a loan officer might have to assist with back-office filing. Routine tasks like verifying documents, keying in data from paper forms, or following up on employment checks can become bottlenecks. Technology can serve as a means for employee retention. In fact, banking leaders report that employee-related challenges are significant obstacles, with 80% of financial institutions viewing employee turnover as a major issue for 2024. High turnover in turn creates a cycle where remaining staff are under more pressure, potentially hurting service quality. For Ohio credit unions, which pride themselves on personal service, any dip in service due to understaffing is problematic.

Another pain point is that every manual step is an efficiency drag. Consider the process of income verification without an automated system: a staff member has to receive a fax or email, interpret a paystub (which might be in any format), possibly call an employer, and then input the data into the loan system. This could take 30-60 minutes of work per loan. In worst cases, important tasks might “slip through the cracks” when staff are stretched thin.

For credit unions facing staffing shortages, this kind of efficiency gain is a lifesaver. It’s like adding extra team members, because the software takes on a large volume of work. Instead of desperately trying to hire more underwriters, a credit union can empower a smaller team to handle a larger workload. One credit union leader from New York highlighted that a digital onboarding platform allowed even a “small team to deliver personalized journeys” and engage members effectively, thanks to automation. The same principle applies to verification – a small team of lenders can process many more loans because they aren’t manually verifying each one. Automated verification ensures that every application is held to the same standard and cross-checked in the same way. It also helps with regulatory compliance (exam auditors love to see consistent processes!).

Photo by Cookie the Pom on Unsplash

Removing tedious tasks can make the workplace more attractive to the tech-savvy talent credit unions seek to attract. This kind of environment – leveraging technology to augment staff – is how credit unions can provide an environment where employees feel they can grow (rather than being buried in busy-work). In a climate where doing more with less is often the norm, such technology is not a luxury but a necessity to continue serving members effectively without burning out your team.

Marrying Trust with Technology for a Brighter Future

Ohio credit unions stand at the intersection of traditional values and modern expectations. They are trusted, community-centric institutions that now must navigate digital transformation, rising fraud threats, and resource constraints. The good news is that the very nature of credit unions (nimble, member-focused, and not driven by profit maximization) positions them well to adapt with the right tools.

Income and employment verification platforms like Verify4 offer a powerful example of how smart technology can reinforce credit union strengths. In essence, these verification solutions let credit unions punch above their weight class – delivering big-bank speed with hometown service. A credit union member can enjoy applying for a car loan at 9 PM and get an answer by morning, all while knowing their local credit union team is a phone call away if they have questions. That combination of technology and personal touch is the recipe for sustained success. As one credit union executive noted, modernizing with the technology consumers want has been key to achieving strong growth. The investment in tools like Verify4 is an investment in member experience, risk management, and efficiency all at once.

By focusing on these key areas and embracing innovative solutions, Ohio’s credit unions can continue to thrive. Most importantly, they will continue to fulfill their People Helping People philosophy – now powered by data-driven insights and streamlined processes that make every interaction easier for both members and staff.

If you are headed to Invest48 this year in Columbus, let’s connect. Our co-founder, Dr. Michael Turner, will be presenting with Navatros on Tuesday, April 22nd at 11:30am during the event. He will be talking about how sometimes, too much tech, often leads to less desirable results when over relying on the latest and greatest tech.

Affordable and attainable housing in the U.S. stands at a crossroads, pressured by economic forces and evolving policies. Public Housing Authorities (PHAs) and policymakers face mounting challenges: rising rents, insufficient housing supply, and complex administrative demands. At the same time, PHAs remain mission-driven to provide safe, quality homes for those in need, often in partnership with community stakeholders. This landscape has amplified the call for innovation – particularly technology-driven solutions – to streamline housing administration. In this blog, we explore recent policy and economic challenges in affordable housing, reaffirm PHAs’ mission and collaborations, examine how technology like Verify4’s verification service can improve housing administration, and highlight the community benefits of streamlined processes. We also draw on current events underscoring the urgency of modernizing how we manage and verify housing assistance. The goal is to inform and persuade decision-makers that embracing these changes is critical to better serve communities in need.

Policy and Economic Challenges in Affordable Housing

Home construction has lagged behind housing demand, contributing to a nationwide shortage of affordable units.

Recent policy shifts and economic trends have placed affordable housing under significant strain. Housing costs have outpaced incomes and inflation for decades, making it harder for families to find attainable homes. Nearly half of U.S. renter households now spend over 30% of their income on housing – a level considered “cost-burdened.” Meanwhile, the cost of homeownership has surged: the median monthly cost of owning a home reached about $3,000 in 2023. Such expenses far exceed what many moderate-income families can afford, underscoring a growing affordability gap. Rents have been rising faster than general inflation for years, and home prices have ballooned by almost 500% since the mid-1980s. This combination of rising rents, high home prices, and stubborn inflation in the shelter sector has made housing insecurity a pressing economic issue.

Beyond costs, housing supply has not kept up with demand, especially at the lower end of the market. Construction of new homes remains sluggish – in fact, new housing construction is over 50% below its peak prior to the 2007 housing crash. The United States faces an acute shortage of affordable units, particularly for the lowest-income renters. National analyses show a deficit of 7.3 million affordable and available rental homes for extremely low-income households, meaning only 33 units exist for every 100 families in that income category. This shortage worsened during the pandemic, as many low-cost rentals were lost and construction slowed. On the policy front, while the current administration has made efforts – such as unlocking $100 million in grants to ease local zoning barriers and executive actions to speed up housing permits – these measures are first steps. The reality is that federal housing assistance is woefully inadequate relative to need: fewer than one in four eligible low-income renter families actually receives any rental aid due to funding limits. Those who do get assistance often wait years; the average household granted a Housing Choice Voucher has spent over two years on a waiting list before receiving help. These economic and policy headwinds – soaring demand, limited supply, and constrained resources – form the backdrop against which PHAs and policymakers must navigate.

Mission Alignment: PHAs and the Quest for Safe, Quality, Affordable Housing

Local officials and community members cut a ribbon at a new affordable housing development, highlighting a PHA’s partnership in expanding housing opportunities.

Despite the challenges, Public Housing Authorities remain steadfast in their core mission: to ensure access to safe, decent, and affordable housing for the most vulnerable. PHAs across the country embrace this mandate daily. For example, the Minneapolis Public Housing Authority defines its mission as promoting and delivering “quality, well-managed homes to a diverse low-income population” and – importantly – working “with partners” to support the well-being of individuals, families, and the community. This ethos is shared widely among PHAs: residents are at the center of their work, and housing is seen not just as shelter, but as a foundation for improved quality of life.

Fulfilling this mission often means collaborating with a range of partners. PHAs coordinate with federal and state agencies, local governments, nonprofit organizations, and private developers to develop, renovate, and maintain housing stock. Many PHAs leverage innovative financing and programs to expand housing opportunities. For instance, partnerships through the Low-Income Housing Tax Credit and HUD’s Rental Assistance Demonstration (RAD) program allow PHAs to team with private developers to rehabilitate aging public housing or build new units. Recent federal initiatives have opened additional avenues: some cities and states have directed American Rescue Plan funds to PHAs to finance new affordable housing, and the Inflation Reduction Act is providing billions for energy-efficient upgrades to affordable homes. These collaborations enable PHAs to stretch resources further – from constructing new developments to modernizing decades-old buildings – all while keeping units affordable. In carrying out their mission, PHAs also focus on maintaining housing quality and safety. They adhere to rigorous HUD standards for property conditions and work to address issues from leaky roofs to lead abatement, often in aging buildings that require substantial capital investment. Through it all, PHAs serve as community anchors: not only landlords, but partners in local development and advocates for the low-income families, seniors, and individuals with disabilities who call PHA properties home. Every initiative and partnership is, at its heart, about aligning with the mission of housing those in need and uplifting communities.

The Role of Technology in Housing Administration

In the face of rising demand and limited resources, technology has become an indispensable ally for housing administrators. Modern, tech-driven tools can dramatically improve efficiency, ensure compliance with complex regulations, and reduce the administrative burden on PHA staff. Many PHAs today grapple with cumbersome, paper-based processes – from collecting income documents to processing applications – which can slow down service delivery. In fact, assessments have found that long waitlists and inefficient administrative processes are common challenges for PHAs, exacerbated by siloed data systems and understaffed offices. These inefficiencies not only strain staff capacity but also delay housing assistance for families in need. Embracing technology offers a path to streamline these workflows. For example, digital application portals can replace stacks of paper forms, and electronic document management can organize case files that were once “boxes of paperwork” cluttering offices. But one area, in particular, stands out for transformation: income and employment verification.

Determining a tenant’s income is central to eligibility and rent calculations in subsidized housing programs – and it’s historically been a labor-intensive task. PHAs must verify wages, benefits, and employment status for each applicant and conduct regular re-certifications for existing residents. Traditional verification meant contacting employers, handling photocopies of pay stubs, and navigating privacy consents – a slow process prone to errors or fraud if a tenant’s income goes unreported. Technology-driven solutions like Verify4’s automated income and employment verification service are revolutionizing this aspect of housing administration. Verify4’s platform, for instance, leverages consumer-authorized, real-time data from government-maintained records to instantly confirm an individual’s income and job status. This means that with a resident’s consent, PHAs can access up-to-date verification of wages or benefits in seconds – no more chasing down HR departments or relying on weeks-old pay stub copies. The data comes with a high degree of accuracy and security, eliminating the need for manual checks and reducing opportunities for errors or fraudulent misreporting. For PHA staff, such tools can dramatically cut down processing time for applications and annual income reviews, freeing them to focus on higher-value work like assisting residents or inspecting properties. Furthermore, automated verification helps ensure compliance with HUD regulations by maintaining a clear, auditable trail of how income was verified and calculated, which is crucial for passing program audits. By integrating services like Verify4 via seamless APIs into their management software, PHAs can modernize their operations – making them more efficient, transparent, and secure. In short, technology is enabling housing authorities to do more with less: process applications faster, enforce program rules more consistently, and reduce administrative headaches for staff.

Community Impact: Streamlined Verification for PHAs and Residents

Photo by Sigmund on Unsplash

Streamlining verification processes isn’t just about bureaucratic efficiency – it carries tangible benefits for both housing agencies and the communities they serve. For PHAs, a faster, more reliable verification system means they can help families access housing assistance with less delay. Instead of an application sitting idle for weeks waiting for income confirmation, decisions can be made in days or even hours. This acceleration is critical when waitlists are long and housing needs are urgent. A more efficient administration allows PHAs to serve more households more quickly, reducing the time that voucher slots or public housing units remain unfilled. It also lowers the risk of errors that could lead to compliance findings or subsidy overpayments, thus protecting the agency’s resources. In essence, by cutting down on paperwork and manual data entry, PHAs can reallocate staff time to proactive tasks – such as outreach to landlords to expand voucher acceptance, or providing counseling to residents – rather than chasing down documents. An agency that runs smoothly is better positioned to expand its programs and adapt to new initiatives, ultimately drawing in more funding and community support to further its mission.

For residents, the impact of streamlined verification is even more profound. Housing assistance often means the difference between stability and homelessness for low-income families. When verification hurdles are reduced, eligible tenants can move into units or start receiving rental subsidies faster, providing immediate relief from unaffordable housing costs. Imagine a single parent struggling to pay rent while her voucher application is pending – cutting that wait time by even a few weeks can prevent eviction and the trauma of homelessness. Streamlined processes also mean greater dignity and less stress for applicants and tenants. Residents no longer have to submit the same paperwork multiple times or travel to PHA offices repeatedly; instead, much of the verification can happen digitally and behind the scenes. This is particularly beneficial for elderly or disabled tenants, or those working multiple jobs, for whom extensive paperwork requirements are a significant burden. Moreover, accurate real-time income data helps ensure residents are quickly connected to the right level of assistance – if a tenant loses a job or has a drop in income, an agile verification system can capture that change so their rent portion is adjusted downward faster, providing a safety net when they need it most. Streamlined income verification can also assist residents in accessing other social services. Many benefit programs (like food assistance or utility relief) require proof of income; a modern verification service can, with permission, be used to share verified income data across programs, acting as a bridge that helps families get all the support they qualify for without redundant paperwork. Ultimately, the community at large benefits when housing administration is efficient: vulnerable households gain stability quicker, neighborhoods see less transiency, and trust grows between PHAs and the public. It’s a compassionate, people-centered outcome – families in need spend less time navigating red tape and more time building their lives in a safe, affordable home.

Current Events Underscoring the Urgency for Improvement

Recent events and developments have put a spotlight on why modernizing housing verification processes and administration is so urgent. On the policy side, new regulations are raising the bar for PHAs to update their procedures. Adapting to these changes can be complex, especially for agencies still reliant on older systems. Without modern tools, PHAs might struggle to comply with the revised requirements accurately – potentially putting their funding or HUD compliance scores at risk. This policy change essentially nudges housing authorities toward greater efficiency and accuracy in income reviews. Technology solutions like Verify4 align perfectly with this need: they provide the precise, up-to-date financial information that new rules demand, ensuring PHAs can implement the new policies without overburdening their staff. In essence, as housing policies evolve to streamline and target assistance more effectively, the administrative systems must evolve in tandem. PHAs that seize this moment to modernize will find it easier to implement current reforms and any future policy shifts that come their way.

Current events have also provided cautionary tales of what can happen when housing administration falls behind the times. A striking example emerged in Milwaukee in 2023, where federal inspectors found the local housing authority’s administrative operations in disarray – an unfortunate case of how outdated processes can undermine an agency’s mission. The HUD audit report revealed mountains of paperwork and severely deficient record-keeping: files were literally stacked in boxes up to five feet high in hallways, and records were so poorly organized that auditors could not even verify basic financial balances in the Section 8 voucher program. This breakdown in administration placed the agency “at risk for serious fraud, waste, and abuse,” according to HUD’s findings. The human impact was immediate and distressing – due to clerical and accounting failures, tenants in Milwaukee reported receiving sudden, erroneous charges and even faced wrongful eviction threats. The situation underscored how crucial proper verification and record systems are: when they fail, it directly harms the people the housing authority is meant to protect. Milwaukee’s crisis has accelerated calls for new leadership and a technology overhaul to get the agency back on track. It’s a vivid reminder that outdated manual procedures are no longer just inconvenient – they are dangerous in a world of complex housing programs and tight oversight. This cautionary tale, alongside other stories from around the country, illustrates why PHAs and policymakers cannot afford to maintain the status quo. In an era of high housing need, every inefficiency or error has a real cost for families and communities. Conversely, every improvement in process – every innovation adopted – translates into safer, more reliable housing assistance for the public. The urgency is clear: the time to modernize and improve housing administration is now, before small inefficiencies become big crises.

Embracing Modernization to Better Serve Communities

The challenges facing affordable housing today – from economic pressures to policy shifts – demand a proactive and innovative response. PHAs and policymakers have a shared responsibility to uphold the mission of providing safe, quality, affordable homes, and doing so requires not just more funding or new programs, but smarter ways of operating. The good news is that solutions are at hand. By harnessing technology-driven tools like Verify4’s verification service, housing authorities can turn a burdensome process into a seamless one, ensuring compliance and efficiency go hand in hand. Data-driven decision-making, enabled by real-time verification, means resources are allocated correctly and quickly to those who need them most. This modernization is more than a technical upgrade – it’s a reassertion of our commitment to serve with excellence and compassion. When PHAs streamline their workflows and reduce administrative drag, they effectively open more doors for families waiting for help. Fewer delays in paperwork translate to more mothers, fathers, seniors, and veterans sleeping each night under their own roof instead of in shelters or precarious situations. For decision-makers, the path forward is clear and persuasive: investing in modern processes and platforms is not an optional luxury, but a necessary strategy to navigate the housing crisis. It amplifies the impact of every dollar in housing assistance by cutting waste and speeding delivery. It also builds trust – with auditors, as records become more transparent and accurate, and with the public, as people see government agencies using 21st-century tools to solve 21st-century problems. In closing, by embracing technology and innovation, PHAs can more closely align with their noble mission and extend their reach in the community. The affordable housing sector can move from being reactive to truly proactive, anticipating needs and responding with agility. Verify4 and similar solutions represent a key piece of this transformation, offering a way to lighten the administrative load while strengthening program integrity. Ultimately, modernizing housing administration is an investment in the stability and well-being of countless American families. It’s about giving hard-working people and vulnerable populations faster access to the housing and services that can change their lives. For communities across the nation, that means a future where safe, affordable housing is not just a goal on paper, but a quickly delivered promise – one verified step at a time.

Consumers are increasingly pessimistic about getting approved for auto loans. Roughly one-third of auto loan applicants now expect to be denied, the highest share on record according to the SCE Credit Access Survey. This sentiment reflects a real rise in rejections: the auto loan rejection rate hit 11.4% in 2024, a new peak since tracking began in 2013 as reported by the Federal Reserve Bank of New York. By contrast, pre-pandemic auto loan rejections were markedly lower (e.g. in 2019). The jump in denials comes as lenders tighten standards – in mid-2023, a net 27.5% of banks reported tightening auto loan criteria according to FRED data – due to concerns over economic uncertainty and borrower risk. In fact, the share of "discouraged" consumers who needed credit but didn't apply (expecting rejection) climbed to 8.5%, also a series high. These trends underscore a significantly tighter credit environment for auto financing compared to the easy credit days of 2021-2022.

During the pandemic, ultra-low interest rates, stimulus cash, and accommodative lending led to easier approvals and record-low delinquencies. As the cycle turned, lenders became warier. Federal Reserve surveys confirm that banks' lending standards for consumer loans, including autos, moved to the "tighter end" of their historical range by 2023 according to The Senior Loan Officer Opinion Survey on Bank Lending Practices by the Fed. Many banks explicitly indicated reduced risk tolerance and expected to tighten standards further. In short, what had been a borrower-friendly market has swung toward caution. Higher required credit scores, larger down payments, and lower loan-to-value allowances are increasingly common as lenders seek to curtail future losses.

Photo by Alex Bierwagen on Unsplash

Loan Approval Rates vs. Credit Performance Over Time

Auto loan approval rates have slid as credit conditions tightened. In 2024 the approval rate was roughly 88.6% (inverse of the 11.4% rejection), down from ~95% approval just a few years prior. Meanwhile, credit default indicators have reversed course from pandemic-era lows. Auto loan delinquencies and defaults, which fell to historic lows in 2020-2021, have now surged above pre-pandemic levels according to the Fed. By late 2023, delinquency rates on auto loans were higher than in 2019, erasing the temporary improvement seen during COVID relief programs. Notably, the deterioration is most pronounced among newer loans: borrowers who took out auto loans in the past two years are driving much of the increase in defaults according to data from the Fed. This suggests a combination of stretched affordability (larger loan balances) and, as the Federal Reserve analysts note, some relaxation of credit standards in 2021-2022 that is now coming home to roost.

Several structural shifts in auto lending may be contributing to higher delinquencies. For one, loan terms have extended significantly. As vehicle prices soared, lenders and dealers increasingly stretched loan maturities beyond 6 years. By Q3 2023, about 12% of auto loans carried terms of 84 months or longer, up from just 4.8% in 2019 according to a November 2023 report. While longer terms reduce monthly payments, they can lead to borrowers being "underwater" on their car (owing more than it's worth) for a longer period and have been associated with higher delinquency rates even for similar credit scores. In essence, some borrowers who might have qualified only for a cheaper car or shorter loan in the past were able to take on bigger, longer loans – boosting sales and balances, but at the cost of greater default risk down the line.

Another factor is the interest rate shock. The average interest rate on financed vehicle purchases jumped to about 8% by the end of 2023, roughly double the rate just two years prior. For subprime buyers, rates often exceed 14%. These higher rates, combined with inflated car prices, have pushed monthly payments to record highs (the average new car payment reached ~$730 in 2024 according to NerdWallet). The strain is evident: more borrowers are falling behind on payments, especially in lower-income and subprime segments. Delinquency rates have been rising across all credit score bands – even prime borrowers are inching upward – but the surge is steepest for subprime loans. There is a clear inflection: after an era of easy money and low defaults, auto credit quality is deteriorating as the tide goes out on loose credit.

Lender Profitability and Portfolio Performance by Institution Type

Despite these headwinds, auto lending remains a key profit center, and its performance varies by lender type. Banks and credit unions – which account for roughly half of auto loan originations according to Consumer & Community data – generally focus on prime borrowers and thus have comparatively lower delinquency rates than specialty auto finance companies. For example, large banks and credit unions both had auto loan delinquency rates near 0.8–0.9% in late 2023, whereas non-bank subprime auto lenders saw substantially higher levels as reported by Liberty Street Economics. In fact, an analysis by the New York Fed showed that the best-performing auto loan portfolios belong to small banks and credit unions, which had the lowest delinquency rates among all lender categories. These institutions often know their customers well and impose prudent underwriting (the median credit score on new credit union/bank auto loans in 2024 was just over 730, versus 636 for loans from finance companies). The result is fewer charge-offs relative to peers.

Auto loan net charge-off rates at U.S. banks have spiked to their highest levels in over a decade (above long-run average), after plunging to historic lows in 2021 amid pandemic stimulus.

From a profitability standpoint, net interest margins (NIMs) on auto loans have been a mixed story. Rising interest rates allowed lenders to charge more for auto loans – boosting interest income – but also raised funding costs. As of Q3 2023, banks' overall NIM had dipped to about 2.89%, slightly below credit unions' 3.09% margin according to CreditUnions.com. Credit unions historically offer slightly lower loan rates, but they also benefit from low-cost member deposits, keeping margins comparable to (or above) banks. In fact, credit union NIM has hovered around 3.0% recently when Credit Union Results Tanked in Q4, even as their cost of funds inched up. Fintech and non-bank auto lenders don't report NIM the same way (since many securitize loans or earn fees), but they typically charge higher APRs to compensate for risk and funding costs. Those higher yields can make auto loans lucrative if losses are contained – a big "if" in the current climate.

Charge-off rates are now eating into those margins. U.S. banks' auto loan net charge-off rate jumped to about 1.2% in early 2024, up sharply from ~0.5–0.8% pre-pandemic according to YCharts. This is nearly double the long-term average loss rate of 0.65%, reflecting the surge in delinquencies. For credit unions, which tend to have more conservative auto loan books, charge-offs hit 0.77% (annualized) in Q4 2023 – a decade high for the industry, up from just 0.43% a year prior. In other words, both banks and credit unions are now writing off auto loans at the fastest pace since at least the early 2010s. This uptick in losses has begun to drag on lender earnings. Credit unions' return on assets has fallen to 0.59%, in part due to "skyrocketed" loan loss provisions for deteriorating performance as Auto Loans Drag on in 2024. Banks, too, have boosted reserves as more borrowers default, though overall bank profitability has been cushioned by other loan categories and fee income.

It's worth noting that fintech and subprime-focused lenders are seeing the worst performance. The New York Fed reports that auto loans originated by "non-captive" finance companies (often serving subprime borrowers) have seen the most pronounced rise in delinquencies, now far above pre-pandemic levels . These lenders charge high rates (often well into double digits) to offset risk, but many are still struggling as loss rates spike. Some have pulled back or tightened approval criteria significantly. By contrast, captive auto lenders (affiliated with manufacturers) and prime-focused banks/credit unions are weathering the storm better, with delinquency rates much lower than those of subprime finance companies as noted in Breaking Down Auto Loan Performance from Liberty Street Economics. Still, even prime portfolios aren't immune – their delinquencies have drifted up off the floor – so all lender types are laser-focused on credit quality now.

Mitigating Risk with Advanced Income & Employment Verification

In this challenging environment, lenders are turning to technology and data to improve underwriting without unduly stifling lending. One promising strategy is deploying advanced income and employment verification solutions (e.g. Verify4). These tools allow auto lenders to instantly validate a borrower's stated income and job status using reliable, up-to-date data – often pulling from employer payroll records or government databases in real time. By leveraging consumer-permissioned data and APIs, solutions like Verify4 eliminate the need for manual document checks (pay stubs, calls to HR, etc.) and reduce reliance on borrower self-reporting. The result is a more accurate assessment of the applicant's ability to pay, catching inflated income claims or fake employment before a loan is approved. In an era of higher defaults, this kind of verification can significantly mitigate fraud and default risk at origination. Lenders can avoid extending credit based on misrepresented finances, which in turn keeps portfolio losses down.

Moreover, robust verification can speed up decisioning for qualified borrowers. Rather than dragging out the underwriting process or adding more conservative buffers for fear of the unknown, lenders who use automated verification get reliable data within seconds. This means underwriters and risk models can make data-driven decisions with confidence. For example, if a borrower's income is instantly confirmed at a higher level than their credit report alone might suggest, a lender could approve a loan that they might otherwise have denied – expanding credit access safely. Verify4 touts coverage of "99% of employees" through its platform, indicating that most applicants' incomes can be verified in this manner. By streamlining verifications and improving their accuracy, such tools not only reduce default rates but also free up lenders to lend assertively where it makes sense. This is especially valuable for risk management teams trying to balance growth and credit quality.

In sum, tighter credit conditions have made prudent underwriting paramount. Lenders are seeing more applicants expecting denial and more loans going bad, a combination that pressures them to be both cautious and smart. Data-driven solutions like advanced income/employment verification provide a way to thread that needle – helping lenders pick the right borrowers and set appropriate terms. Finance professionals in underwriting and risk strategy are increasingly embracing these technologies to reinforce their loan portfolios. By weeding out unqualified applicants and verifying the strength of approved borrowers, lenders can improve loan performance even amid economic stress. In today's auto loan market, better upfront verification and risk modeling have moved from nice-to-have to necessity, enabling institutions to protect their net interest margins and loan books while still saying "yes" to worthy customers.

Lending is a service that is nearly entirely based on information. Large databases were developed many decades ago to fulfill some of the information needs of consumer lending. These credit bureaus were the original big data before Big Data. Models were developed to analyze such data to predict consumer credit risk by lenders, by the likes of FICO, the credit bureaus, and lenders themselves, of course. This helped systemize and automate aspects of lending, making it more efficient, enabling risked-based pricing, improving performance, and improving access to credit. 

Nonetheless, while our society is evermore awash in data, there are still too many Americans and Ohioans that are credit invisible. These are people who have too little or even no traditional credit information on which traditional credit scores are based. The result is no credit score or a low credit score.

What’s the magnitude of the problem? The CFPB has looked into this issue over the last decade and found that about 1-in-5 adult Americans either had no traditional credit file or had insufficient credit data to produce a credit score. It also looked at this on a state-by-state and found this problem is just as pronounced in Ohio noting, “About 1,714,000 adults in Ohio, or about 1 out of every 5 adults, are credit constrained because of a limited credit history.”

However, what was most astonishing from their work was that about 45% of the adults in the lowest income Census Tracts examined were credit invisible. Credit invisibility was also found to be worse in rural America. 

As noted by the CFPB, the credit invisible often have reduced access to credit, or simply have access to credit on less favorable terms. Importantly, this is not due to their measured risk but instead due to a lack of information.

These findings were not news to me or my fellow co-founder at Verify4, Michael Turner, who have for years studied the problem of Credit Invisibility at a non-profit named PERC. Our research had also shown that the problem of credit data gaps was not a minor issue and one that impacted members of lower-income households disproportionately.

Our research also pointed to solutions. Since Credit Invisibility was due to people not having sufficient credit payment histories, we tested how adding other types of payment histories, like from energy utilities, telecoms, or rent might impact the problem and credit scores. We found that adding payments from such accounts not only solved much of invisibility problem, but the added data improved credit score performance and was found predictive of consumer credit risk. That is, those who paid their phone and utility bills fully and on time, were better credit risks than those who did not. This should not be a surprise.

Having this payment data reported to the major credit bureaus would be a win-win. It would improve consumer access to lower-cost mainstream credit, particularly lower income consumers, and it would help lenders serve consumers more easily. For consumers, this would help break the credit Catch-22, needing an already established credit history to obtain credit. A responsible consumer who wishes to save and not take on unnecessary credit cards and debt would be able to demonstrate their risk by using payment histories from their everyday, non-credit obligations. They could build their payment history without going into debt.

Photo by The New York Public Library on Unsplash

Why isn’t this done now? In this country credit reporting is voluntary and there happens to be little tradition with utilities credit reporting. Utilities often look at credit reporting as a hassle that could increase their customer service costs (this despite the fact that research has shown that utilities that credit report see improvements in the payment patterns of their customers). Large telecoms, like mobile phone service providers, on the other hand, appear to not credit report due to fears that if they credit reported which customers pay on time their competitors may try to poach them.

What makes this so unfair to consumers is that late or very late payments to utilities and telecoms are often reported to the credit bureaus either directly or via collections companies. So, consumers are punished when late but not rewarded for on time payments. All stick, no carrot. A consumer could have fallen behind on their mobile phone bill and have a collection that will last years for it, but when they start paying a phone bill on-time that would not be reported!

What makes this status quo so unfair to bankers and other lenders is that their payment data, such as from auto loans or credit cards, are used when telecoms or utilities pull credit reports and scores to set rates or deposits. But there is no reciprocity, lenders don’t have similar access to the payment data from utilities and telecoms.

Lenders should start demanding a fairer credit reporting system in which major non-credit users contribute back to the system. And consumers should be up in arms that their phone providers and utilities are happy to ding their credit record with collections that will stay on their file for years but choose not to report when the consumer pays on time. Such a fairer system would also go a long way to solving the problem of credit invisibility and improving access to mainstream credit for lower-income and rural consumers.