First American Subordinate Lien Outsourcing, a member of The First American Corporation family of companies, has debuted its Tool for Reserve Underwriting (TRU) Scoring Model. The TRU Scoring Model provides a valuation solution that defines the potential loss, predicted recovery and velocity of recovery on a monthly timeline for a subordinate loan pool.
Created to address the risk management needs of Wall Street and hedge fund clients, the TRU Scoring Model delivers gross recovery cashflow projections on a 24- to 36-month basis for a pool of performing and/or nonperforming subordinate lien assets, the company explains.
The solution projects recovery based on internal collection experience with similar types of collateral derived from a robust set of delinquency and collateral characteristics. It also uses securities prepayment and default data matched with market pricing to determine forward market assumptions and the resulting cashflow projections.
Source: First American Subordinate Lien Outsourcing