New Methods
The VFA allows for the development of new methods for debt management and default prevention. Previously, the guarantor financing model was more focused on default collection. Approximately 60 percent of a loan guarantor’s revenue was generated from the collection of defaulted loans, with less than 10 percent coming from default prevention and zero percent coming from delinquency prevention. Under the VFA, focus shifted to proactive delinquency, which means to stop repayment problems before they begin.
Read more about this topic: Voluntary Flexible Agreement
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