View more on these topics

AVMs poised to ‘cascade’ in 2008

UKValuation has predicted that ‘cascading’ – the use of multiple AVMs by the same lender – will be the defining feature of the AVM market in 2008.

It argues that cascading is firmly established as best practice in the US market, and predicts that the AVM market in the UK has now reached sufficient maturity to embrace the same approach.

UKValuation’s CEO, Mark Witherspoon, said: “There are clear benefits to a lender which elects to use multiple AVMs. The main benefit is as a risk management strategy. Using multiple AVMs has become common practice in the US, and the reasons why are fairly straightforward to understand.

“Using a cascading AVM system enables lenders to select the best AVM for every request, to rank AVMs by looking at a variety of different statistical performance metrics and to define ‘cells’, for example split by geography and property type, to better segment AVM performance.

“This way, multiple AVM usage enables lenders to achieve greater accuracy than from a single AVM, and it also creates the ability to custom-define cells based on individual customers’ risk preferences. In this sense, a cascade effectively becomes an ‘AVM’ in its own right.”


How to understand your customers and retain them

US academic and business expert Dr Robert L Phillips believes that with 1.4m mortgage loans up for review in a very tricky market, UK lenders should be reviewing their pricing and retention strategy and address the challenge of optimum pricing

FSA says it will stick to principles

Financial Services Authority chief executive Hector Sants says that the recent market turbulence and problems at Northern Rock will not affect its commitment to principles-based regulation.


Employer iPMI responsibilities could continue to escalate, says Jelf

New laws in Dubai will put the burden of providing international private medical insurance (iPMI) firmly on the shoulders of the employer in order to maintain the country’s leading healthcare facilities. With 10,000 UK nationals having moved to the country since 2007 and only 16.5 per cent of the total 8.2 million people living there being Emiratis, Jelf Employee Benefits believes this move was inevitable and employer responsibilities could continue to escalate in future.


News and expert analysis straight to your inbox

Sign up