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Exact hits £2.5bn due diligence milestone in risk assessment

Exact has carried out due diligence on more than 20,000 borrowers and £2.5bn worth of mortgage assets since launching its Asset Quality Assessment service in April 2008 when the firm was still trading as edeus.

Exact managing director Alan Cleary said: “We knew there was demand for granular-level credit risk assessment on mortgage-backed assets but the business has taken off at breakneck speed. Lenders and investors don’t want to be in the dark about risk – in this market, ignorance is not bliss.”

The Exact team has completed due diligence for four big investment banks and hedge funds since introducing AQA. A clear understanding of the risk and value of mortgage assets is critical, particularly in light of the government’s guarantee scheme.

Cleary added: “The AQA service has enlightened clients as to the risks in their mortgage assets, and they have used this knowledge to great effect. They finally understand the true value of their residential mortgage-backed securities and whole loan books.”

Exact also offers arrears management on underlying mortgages. Using the information AQA offers, the firm claims a book’s performance can be maximised by intelligently targeting borrowers in the credit collection process.

Business-to-business news in brief

  • GMAC-RFC has selected specialist The Charlbury Group to provide its arrears management system which enables a seamless two-way data flow from lenders to its asset managers, litigation solicitors and contractors. The company will also be helping GMAC-RFC to carry out a series of mystery shopping exercises using both desk-based research and field visits.
  • Checkmate Mortgages has selected DPR to support its new lending operations. Checkmate’s proposition, pioneered by GMAC-RFC’s former executive chairman Stephen Knight, is due to launch later this year. Dave Patel, managing director of DPR, claimed: “As a provider of agile solutions to mainstream and specialist lenders, our technology for multi-channel and multi-brand lending propositions is unparalleled.”
  • Kent Reliance Building society has appointed London & European as title insurance provider for its remortgage book. Mike Lazenby, chief executive of KRBS, said: “Sound evaluation and mitigation of risk is essential for successful lending these days. Adopting title insurance to help reduce the risk to our remortgage books makes sense. Because L&E offers a ‘six-month cure or pay’ guarantee we know that if a problem does arise we can be sure the risk will be covered, and also that we are guaranteed to recover any loss we may incur quickly.”


FSA to regulate sale-and-rent back

The Financial Services Authority has published a consultation paper setting out proposals for the regulation of sale-and-rent back schemes.

Good time to get closer to clients

Lenders have a duty to lend responsibly but in the current climate, as many exit the market, those that remain are being forced to amend criteria to ensure they hit capital targets.


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