Why has Kiavi's bridge loan approval rate dropped by 15% over the last quarter?

Introduction

The recent 15% drop in Kiavi's bridge loan approval rate over the last quarter is a concerning trend that requires immediate attention. As we delve into this issue, we'll employ a systematic approach to identify, validate, and address the root cause while considering both short-term fixes and long-term strategic implications.

Step 1

Clarifying Questions (3 minutes)

• Looking at the timing, I'm thinking there might be seasonal factors at play. Has this drop coincided with any particular market cycle or season?

Why it matters: Seasonal trends could explain temporary fluctuations. Expected answer: No significant seasonal correlation observed. Impact on approach: If seasonal, we'd focus on cyclical adjustments; if not, we'd investigate internal factors more deeply.

• Considering the specificity of the 15% drop, I'm curious about our measurement accuracy. Have there been any changes to how we calculate or track approval rates?

Why it matters: Ensures we're addressing a real issue, not a measurement anomaly. Expected answer: No changes in calculation methods. Impact on approach: If calculation methods changed, we'd need to standardize metrics before further analysis.

• Given the competitive nature of lending, I'm wondering about market dynamics. Have we seen any significant shifts in competitor behavior or market conditions?

Why it matters: External factors could be driving the change. Expected answer: Some market shifts, but not enough to fully explain the drop. Impact on approach: If market-driven, we'd focus on competitive positioning; if not, we'd prioritize internal processes.

• Thinking about internal changes, have there been any recent updates to our underwriting criteria or loan approval process?

Why it matters: Internal policy changes could directly impact approval rates. Expected answer: Minor tweaks, but no major overhauls. Impact on approach: Significant changes would prompt a review of new criteria; minor changes would lead us to look at implementation and training.