Payment Plan Default Rate Calculator

Payment plans re-default often. This calculator sizes success rate.

Plans executed

Plans completed

Plans re-defaulted

Avg plan balance

Default rate %

40.00%

Estimated loss from defaults

$80,640

Success rate %

60.00%

How the math works

Default rate = re-defaults / executed. Loss = re-defaults × avg balance × loss %.

Portfolio-wide payment plan success rate above 60% is healthy; below 50% signals either plan terms too generous or population too distressed. Tightening plan rules (shorter term, auto-debit, first month upfront) typically improves success 10-15 pts.

How to Use

Enter plans executed.
Enter plans completed.
Enter plans re-defaulted.
Enter avg balance on plan.
Read default rate and loss.

Frequently Asked Questions

Typical rates?

First-time plans: 50-70% successful. Repeat plans: 30-50% successful. 3+ plans: under 30%. Workforce housing: lower success vs luxury. Re-default signals chronic cash flow issue, not temporary setback.

Plan design?

Short plans (3-4 months): higher success. Long plans (6+ months): lower. Auto-debit required: +20% success. Manual pay: frequent slippage. First payment upfront: better commitment signal.

When to say no?

Third plan request within 12 months, income unchanged: decline. Accumulating balance beyond 1.5x monthly rent: decline or require substantial lump sum. Better to move to eviction than compound exposure.

How does this interact with the rest of the capital stack?

Each tier of the stack affects the next. Senior debt constrains LTC and DSCR. Mezz and pref consume equity spread. Interest rate hedges protect DSCR but cost premium. Always model the full stack holistically — optimizing one tier alone often degrades another. Institutional underwriters run three or four scenarios across the stack before committing capital.