CoreLogic Announces New Loan Modification Decisioning Platform
Email Dan Smith
July 21, 2010, Santa Ana, Calif. –
WillCap Analytics Employs Newly Developed Behavioral Technology That Optimizes Outcomes for Borrowers and Mortgage Holders
CoreLogic (NYSE: CLGX), a leading provider of information, analytics and business services, today announced the availability of WillCap, a ground-breaking, decisioning system that predicts a distressed borrower’s willingness and capacity to make mortgage payments and enable investors and servicers to make more strategic loan modification, short sales and liquidation decisions, at both a loan and portfolio level.
WillCap is driven by innovative, behavioral technology that is proprietary to CoreLogic. The technology was developed using CoreLogic data and talent resources to create a unique solution that combines consumer credit, property information, loan product information and in-depth local real estate market information at the borrower-level across a multi-million-borrower database. WillCap’s behavioral technology provides deep insights into the drivers of borrower behavior that gives the user an information rich, holistic view of the borrower and their individual circumstance. Using WillCap, a holder of distressed mortgages can craft loan treatment strategies to maximize both loan value and borrower retention. WillCap, which is already in use with several leading institutions, has a wide range of uses including distressed loan treatment, loan surveillance, loss forecasting and even portfolio-level, loan treatment strategy development.
Specific Loan-level and Portfolio Recommendations
In its Treatment Engine application, WillCap delivers an operational treatment recommendation that has been proven through actual use to lower losses and redefault rates. Through rich analysis of consumer credit data and the effects of collateral characteristics on borrowers' decisions, WillCap provides a greater degree of confidence in implementing the proper loan treatment, based on a borrower's likely future behavior, to maximize servicing and portfolio asset value and/or increase borrower retention and satisfaction.
To ensure minimal treatment risk and maximum economic benefit, WillCap not only recommends the treatment, it also specifies the optimal terms. For example, when recommending a loan modification, WillCap specifies the payment and principal amounts needed to ensure that the borrower can service that loan modification for a specified period of time (e.g. 36 months), while also maximizing loan cash flow and value. Further, when making an REO-sale recommendation, WillCap also specifies the sale price that ensures that the property will be sold within a specified time-on-market; the WillCap price recommendation also maximizes cash value upon sale.
Using WillCap, a mortgage holder has the tools to:
- Reduce defaults, including strategic defaults—The system categorizes borrowers into 22 clusters, enabling decision-makers to determine how, when and with whom to take preemptive action to reduce defaults. Several of these “clusters” predict candidates who without pre-emptive intervention, usually principal reductions, will likely ruthlessly default, even though they have the wherewithal to pay their mortgages.
- Determine where, when and why to discount principal—Identify which kinds of borrowers respond to principal reduction and determine the optimal principal reduction amount.
- Increase borrower retention through loan modification—Assess the likelihood that a borrower will succeed at loan modification and refine the terms (payment, principal, etc.) to successfully extend the life of the loan modification, while minimizing re-default and loss.
- Increase the net returns of asset disposition (property sale)—Objectively define those situations where it is best for the borrower and the mortgage holder to sell the property and recommend the optimal price and terms for short sales.
- Increase credibility with regulators and other government related entities—WillCap, as a neutral third party platform, can help to substantiate a mortgage holder’s portfolio management and treatment strategies.
“WillCap brings objectivity, transparency and predictability to loss mitigation and default management. Servicers and investors can use this new solution to craft workable distressed loan treatments that can increase loan modification success, while significantly reducing losses,” said George Livermore, group executive for Data and Analytics, CoreLogic.
WillCap was developed after an extensive review of more than 5 million loans, including more than 1.2 million loans that had been the subject to some form of treatment, such as loan modification, short sale or foreclosure. WillCap is offered as an application service provider (ASP) service complemented by CoreLogic professional services.
CoreLogic (NYSE: CLGX) is a leading provider of consumer, financial and property information, analytics and services to business and government. The company combines public, contributory and proprietary data to develop predictive decision analytics and provide business services that bring dynamic insight and transparency to the markets it serves. CoreLogic has built the largest U.S. real estate, mortgage application, fraud, and loan performance databases and is a leading provider of mortgage and automotive credit reporting, property tax, valuation, flood determination, and geospatial analytics and services. More than one million users rely on CoreLogic to assess risk, support underwriting, investment and marketing decisions, prevent fraud, and improve business performance in their daily operations. Formerly the information solutions group of The First American Corporation, CoreLogic began trading under the ticker CLGX on the NYSE on June 2, 2010. The company, headquartered in Santa Ana, Calif., has more than 10,000 employees globally with 2009 revenues of $2 billion. For more information visit www.corelogic.com.