Analyzing Bank Debts

After a debt has been legally declared "uncollectable" by a bank, the account is considered "charged-off." But that doesn't mean the bank walks away from the debt. They still want to collect some of the money they are owed. The bank will score the account to assess the expected recovery amount, that is, the expected amount that the bank may be able to receive from the customer in the future. This amount is a function of the probability of the customer paying, the total debt, and other factors that impact the ability and willingness to pay.