Calculating Relative Performance

Once the Comp value has been calculated, we can see to what degree the rates for each servicer are higher or lower than the Comp and find the percentage their performance is different from the Comp values. That aggregated difference will become the basis of how the STAR Performance Scorecard measures servicer’s relative performance.

The following table reflects how the Comp values we calculated are used to calculate the percent difference to Comp for each servicer. To do this, start by subtracting the Comp value from the servicer’s numerator value to establish the difference between those numbers. Then divide that total by the Comp value to establish the percent at which it varies. For metrics where a lower value is more desirable, like Transition to 60 plus, the result is adjusted by a factor of minus 1 so that larger values are always better.

Table 7: Calculating Variance to Comp

Recall from Table 5 that the absolute performance of these two servicers was nearly equal. However, the variance to comp is different between the two servicers as a result of the difference of portfolio composition of the two servicers.