Constant Default Rate - CDR

Everyone loves a good ratio. Same holds true in the mortgage industry.

Lenders pay close attention to the constant default rate, which measures the number of home loans that have fallen more than 90 days behind on payment. Given that the CDR is part of a pool of loans, the ongoing additions of many pools give economists a large look at the total default rate in a market. The measurement is important because it offers a window into the health of consumer credit, and the ability to meet financial obligations.