Minneapolis-based ""FICO"":http://www.fico.com, a provider of analytics and decision management technology, recently announced that ""Experian Capital Markets"":http://www.experian.com/capital-markets/capital-markets-vertical.html is adding FICO credit scores to its CreditHorizons for Securities solution.
Sellers and investors of mortgage-backed securities (MBS) use Experian's CreditHorizons for Securities to surmount the limitations of loan-level data when analyzing credit risk in potential bond investments.
FICO says the addition of the FICO score, branded by Experian as the Experian/FICO Risk Model, will give[IMAGE] [COLUMN_BREAK]
managers, marketers, and investors of residential mortgage-backed securities (RMBS) deeper insights for evaluating creditworthiness of the underlying mortgages in non-agency loan pools.
CreditHorizons for Securities is used to improve pricing strategies on the sell side while helping buyers make investment decisions with greater confidence and improve risk management.
The FICO score brings an added dimension of predictive power, enabling users to better assess risks of delinquencies and defaults from securitized mortgages, according to the company. FICO explained that investors benefit from using fresh credit scores instead of scores calculated when loans were originated, since recently reported changes in borrowers' credit behavior will likely change their credit risk.
""We are excited to offer more comprehensive solutions to support the needs of the secondary market and securitization process for U.S. mortgages,"" said Jordan Graham, EVP of scores at FICO. ""We believe this combination of Experian Capital Markets and FICO solutions will increase investor confidence and make for a more efficiently functioning market.""