TrueLTV Business Value
TrueLTV enables issuers, investors, insurers, servicers, credit risk managers, mortgage researchers, and whole loan traders to identify, evaluate, and monitor the impact of HELOCs and other second-mortgage liens on the value of active first-mortgage pools and portfolios.
How Seconds Hurt
Thanks to current out-of-date reporting standards, HELOCs and other secondary
liens have been permitted to increase mortgage portfolios’ loan-to-value (LTV)
and combined loan-to-value (CLTV) ratios—effectively lowering their overall
value—without revealing these fundamental factual alterations to portfolio
issuers, investors, or anyone else.
Why Now?
According to LoanPerformance data, from 23 to 53 percent of first-mortgage
borrowers now add seconds, thirds, or more within two or three years of
issuance. While providing a happy new source of liquidity for homeowners, this
spike in added encumbrances has become a growing problem for anyone dealing
with mortgages in pools or portfolios—since the actual LTV/CLTV ratios may
differ significantly from those indicated for the first mortgages alone.
Needless to say, such decreases in value can lead to substantial increases in
risk.
The TrueLTV Solution
TrueLTV updates portfolio LTV/CLTV reporting standards by identifying all
subordinate liens affecting the value of first mortgages. This information,
which itself can be updated regularly, enables you to determine accurately the
actual current risk associated with a pool or portfolio (more
about product).
For More Information
To learn more about TrueLTV, please send us an
email or give us a call at the appropriate number for
your geographic area.
*Originally introduced as SecondLook.
