Response Analytics has rolled out a new solution based on behavior modeling and optimization technology that the company says will allow distressed-asset investors to both determine the value of underpriced assets and direct their modifications so as to maximize collectible value. The solution operates at the loan level and with the requisite data and extends to mortgage-backed securities (MBS) as it does for whole loans.
‘Until now, investors would have been taking a shot in the dark with pricing distressed-mortgage portfolios and mortgage-backed securities," says Brent Lippman, Response Analytics' CEO. "That's the key reason that the market for them froze. But now, optimization technology will allow them to confidently assess one of the most discounted assets currently available and to go on to create more value than the current market expects."
An optimization technology approach can take into account regulations or investor covenants that constrain the optimization of workout options across the portfolio, as well as the investor's own time horizon, the company says. This information is used to calculate the real hold-to-maturity value of the entire portfolio, which can be used by the investor to make portfolio purchase and modification decisions.
SOURCE: Response Analytics