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Distressed Asset Investors:Accurately determine “hold-to-maturity” value in order to fully take advantage of buy/sell opportunities with distressed mortgages.Distressed asset investors come in multiple forms; those that hold or wish to acquire loans or assets and outsource the loan servicing and those that are vertically integrated with a servicing capability. In any case, the primary need of the investor is first to accurately assess the (hold-to-maturity) value and then protect that investment. Asset protection is derived in part from the servicing organization, and their process for predicting delinquency and default and mitigating losses on distressed assets. The problem in today’s market is that “mark-to-market” valuations - consistent with FAS 157 (introduced November 2007), which says “the price to sell an asset is based on the principal market at the measurement date” - have little or no validity. Response Analytics’ Distressed Portfolio Management (DPM) solution begins with a valuation methodology that uses servicing history (not mark-to-market) plus available credit information for every loan across every portfolio, derives “predictive” behavioral models for each loan and then uses advanced optimization science to decide the most realistic outcome for each loan across the entire portfolio in order to accurately assess portfolio value – at any point in time. Behavioral models are refreshed continuously and therefore are reflective of current market conditions. Learn more about Distressed Portfolio Management. |
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