Roll rate

Roll rate,

Definition of Roll rate:

  1. Angular velocity about a roll axis.

  2. In the credit card industry, the roll rate is the percentage of cardholders who become increasingly delinquent on their account balances due. The roll rate is essentially the percentage of card users who "roll" from the 60-days late category to the 90-days late category, or from the 90-days late to the 120-days late category, and so on.

  3. Roll rates are used by banks to help manage and predict credit losses based on delinquency. In the credit card industry, creditors report late payments in 30-day increments beginning with the 60-days late category and ranging through 90-days late, 120-days late, 150-days late and so on up to charge-off. Charge-offs are subject to private company discretion and state laws. For federal loans, a charge-off is required after 270 days according to federal regulation.

  4. The percentage of borrowers who become moderately past due on payments to an account who will go on to become significantly past due. In the credit card industry, delinquencies are categorized as 30 days, 60 days, and 90+ days past due. If 5 out of 100 borrowers who start out being 30 days late are still delinquent at the 60 day mark, the roll rate for delinquency is considered to be 20 percent.

How to use Roll rate in a sentence?

  1. For instance, you can measure the percentage of cardholders who roll from 60-days overdue to 90-days overdue.
  2. The roll rate is the percentage of credit card cardholders that roll from one category of delinquency to the next.
  3. Roll rates are used to estimate financial losses due to future defaults.

Meaning of Roll rate & Roll rate Definition