InsideValuation, a real estate valuation company serving the commercial and residential mortgage market, recently upgraded its InsideRisk collateral risk-scoring model. The upgraded version evaluates key data linked to approximately 43,000 ZIP codes to measure the level of risk associated with proven economic and demographic variables.
The InsideRisk scoring model was initially developed in 2005 to provide Wall Street investment banks with an additional level of risk rating for properties securing pools of mortgages. The upgrade, the company says, simplifies and speeds up the loan origination process for commercial lenders.
The five key variables that are evaluated by InsideRisk include affordability, unemployment, property crime, violent crime and gross rent multiplier. These variables are categorized by five risk rankings: low, average, elevated, high and very high.