New CoreLogic Program Assists Mortgage Lenders In Disaster Recovery Situations
-- Collateral data technology allows lenders to quickly assess probability of default in troubled areas --
SACRAMENTO, Feb. 14, 2006 –In recent months, Gulf Coast homeowners have filed some 239,000 flood insurance claims from hurricanes Katrina and Rita, and the estimated $23 billion that is to be paid through the National Flood Insurance Program greatly exceeds its yearly premium collections of $2 billion. Faced with this situation, mortgage lenders needed a unified approach to gathering data to access their loan reserves and respond to the Housing Policy Council’s (HPC) need for data.
The Housing Policy Council is the premier forum in which leaders of the U.S. financial services industry determine and influence the most critical public policy issues that shape the competitive financial services marketplace and the growing national economy.
In a disaster situation, lenders need an immediate estimate of loss reserves, while also identifying high-risk loans due to the disaster to conclude a workout strategy. They also must complete mandatory HUD and federal agency reporting, identify those loans where immediate default conditions need to be applied and properly service their customer base.
In response, CoreLogic, the leading provider of mortgage risk assessment and fraud prevention solutions, has developed a program that analyzes the appropriate data and displays it visually utilizing geographic information systems (GIS). Lenders provide property address information for potentially impacted properties which is then run through CoreLogic’s HistoryPro collateral evaluation tool. The data stream is geographically coded to create an exact location on a map and overlay any known boundary condition such as FEMA disaster zones, flood levels, storm surge, etc. and returned by CoreLogic to the lender and the HPC.
“Lenders can now quickly assess preliminary damage levels on individual loans and determine the overall impact on loss reserves for their entire portfolio,” said Scott Shaw, Vice President, Sales. “We have already worked with ten of the top lenders in the country, processing over a million loans, to help them determine their investigation strategy.”
HistoryPro is a proprietary risk assessment engine that evaluates numerous elements to determine its industry pioneering F-score, including the relationship between foreclosures and price appreciation, the subject property sales price relative to the current appraisal or origination estimate, the origination value relative to the market, prior foreclosure(s) on the subject property and geographic conditions surrounding the subject property. In addition, HistoryPro references foreclosure and volatility models as well as overall performance studies to incorporate the most accurate data possible.
HistoryPro also includes subject property history detail, nearby property sales information, market data, and a buyers and sellers transaction summary. These features are combined with other analytical metrics to create an easy to use, information rich decision dashboard that uniquely equips lenders to more clearly identify and control collateral risk.
“This program allows lenders to build a risk preparedness model to respond to future disasters,” said Shaw. “In addition, the graphical representation allows managers to quickly assess and communicate the risk to their business in the event of a disaster.”
About CoreLogic
Sacramento, Calif.-based CoreLogic, A C&S Company, is the leading provider of collateral risk-analysis and management technology and services to the U.S. mortgage banking industry. Since 1997, the mortgage industry has relied on CoreLogic to enable risk management and workflow process support. Using CoreLogic technology, mortgage originators and investors are able to increase profitability and loan quality by making more informed lending and investment decisions. The CoreLogic suite of property information tools provides the data, comprehensive geographic coverage, ease-of-use and accessibility the mortgage industry needs. For more information about CoreLogic, visit www.corelogic.com.
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