Level1Analytics is committed to providing customers with the accurate, defensible information they need to mitigate risk in their portfolios.
L1aStress gives you the ability to estimate expected losses inherent in a mortgage portfolio under three different economic scenarios:
- Moderate — a continuation of today’s real estate values
- Severe — a diminution of real estate values
- Worst — a significant erosion of real estate values
Losses for these three scenarios result from the product of frequency of foreclosure estimates and loss severity for each of these expected foreclosures (with a cap of 100%). All estimates used by our L1aStress system are calculated at the loan level according to our proprietary algorithms, details of which we provide to our customers to ensure transparency and defensibility.