First American LoanPerformance, a residential mortgage data and analytics provider for the mortgage industry and Wall Street, said Tuesday that the latest version of its RiskModel analytics solution for forecasting future mortgage prepayments, defaults, losses and projected cash flows has been released. Highlights of the new release include new subprime models, which expand subprime prepayment and delinquency models to reflect the changing dynamics of the subprime mortgage market, as well as a newly-developed home equity model that projects utilization, default and prepayment behavior. The company also introduced a new Windows-based application programming interface, or API, as well as new database connectivity options designed to speed the integration of the RiskModel platform into a client’s internal business processes. “This version of the RiskModel significantly increases the precision of our clients’ pricing and loss reserve-setting practices,” said Dan Feshbach, chief executive officer and president of First American LoanPerformance. “By integrating both API and database connectivity, our clients will now have a tremendous opportunity to upgrade the speed and control of their mortgage risk assessment processes.”
RiskModel simultaneously considers both prepayment and default risk while integrating the effects of borrower behavior, interest rate fluctuations and housing price movements on residential mortgages, and contains multiple statistical models that can be used with prime, alt-A, nonprime loans and home equity lines of credit. By enabling institutions to more accurately set loan loss reserves, LoanPerformance says its RiskModel platform performs a full spectrum of risk management processes including: portfolio grooming, risk-adjusted pricing, cash-flow projections, valuation of securities or insurance, loss mitigation, asset and liability management and hedging, and the negotiation of appropriate coverage on securitization and guaranty fees. First American LoanPerformance is a subsidiary of First American Real Estate Solutions and a member of The First American Corporation (NYSE:FAF) family of companies. LoanPerformance’s databases track the delinquency and prepayment performance of 50 million active individual mortgage payments per month and provide loan-level information on more than $1.6 trillion in nonagency mortgage and asset-backed securities. For more information, visit http://www.loanperformance.com. Full disclosure: The author of this commentary does not own securities in any of the publicly-held companies discussed herein. Housing Wire will always disclose the financial position of its writers or contributors.
