🏦 Home Loan Default Prediction

Predicting the likelihood of home loan default using machine learning models trained on customer financial datasets.

🚀 Project Overview

Banks and financial institutions face significant risk when customers default on home loans.
This project applies data science and machine learning techniques to:

• Analyze customer demographics and financial history
• Identify key drivers of loan default
• Build predictive models to assess risk

Goal: Help financial institutions minimize loan default risk and improve credit decision-making.

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🔧 Tech Stack

• Programming: Python (Jupyter Notebook)
• Libraries:
  • Data Analysis → pandas, numpy
  • Visualization → matplotlib, seaborn
  • Machine Learning → scikit-learn, xgboost, lightgbm
  • Model Evaluation → accuracy, precision, recall, F1-score, ROC-AUC

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📈 Workflow

1. Exploratory Data Analysis (EDA)

   • Distribution of loan approval and defaults
   • Correlation between financial features
   • Feature importance visualization

2. Data Preprocessing

   • Handling missing values
   • Encoding categorical variables
   • Feature scaling
   • Handling imbalanced classes (SMOTE/undersampling)

3. Modeling

   • Logistic Regression
   • Random Forest
   • XGBoost / LightGBM
   • Support Vector Machine

4. Model Evaluation

   • Train-test split & cross-validation
   • Metrics: Accuracy, Precision, Recall, F1-score, ROC-AUC
   • Confusion matrices and ROC curves

5. Insights & Business Value

   • Identify customer segments with higher risk of default
   • Improve loan approval policies and reduce NPA

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📊 Visualizations

• Feature importance plots
• Correlation heatmaps
• ROC & Precision-Recall curves
• Loan approval and default distributions

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💡 Future Improvements

• Deploy as a Flask/Django web app
• Integrate with live banking systems
• Use advanced models (CatBoost, deep learning)
• Hyperparameter optimization with Optuna

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🤝 Contributing

Ari R.
Data Scientist
🔗 GitHub | 📧 ariranalyst@gmail.com

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✨ Developed with passion for Data Science & Machine Learning. "# Home Loan Default Prediction" "# HomeLoan_Default-Risk_Management"