SHELTON, Conn., Oct. 15 /PRNewswire-FirstCall/ -- Clayton Holdings Inc. (NASDAQ:CLAY), a leading provider of information-based analytics, consulting and outsourced services for capital markets firms, lending institutions, fixed income investors and loan servicers, today announced the next generation in due diligence: Clarity(TM). The new process gives loan buyers/securitizers greater insight into the risk profile of portfolios at the time of purchase, as well as a projection of future losses and new options to reduce potential losses.
Clarity is a predictive approach that incorporates the company's proprietary risk-filter technology built upon the data collected in its surveillance of more than $1.5 trillion of subprime and Alt-A mortgage-backed securities.
Unlike traditional due diligence, which simply reports on whether or not loans meet an acquirer's guidelines, Clarity scores individual loans and the overall portfolio for credit, compliance, collateral and estimated loss risk. Using these risk scores, clients can more effectively target their due diligence reviews using a modular approach. Best-of-breed, third-party data and technology can also be integrated into the process to assess collateral and fraud risk.
Clarity offers clients summary dashboards that first quantify the initial level of risk in a given portfolio and then track how this is mitigated during the due diligence process. By identifying the riskiest loans and focusing the due diligence reviews more specifically, Clarity is able to improve the overall risk score and reduce potential losses during the sale and securitization processes.
Loan-level information generated through Clarity can be incorporated into Clayton's Surveillance databases, and used to update its originator and broker scorecards to improve its fraud detection screens. Clarity can also be linked to Clayton's Special Servicing unit to improve the servicing of "scratch and dent" portfolios.
"To bring liquidity back to the MBS/ABS markets, Clayton has been approached by issuers who want to demonstrate to investors that new safeguards are in place to prevent losses and that there is greater transparency into the quality and the future performance of their bonds," said Keith Johnson, President and Chief Operating Officer of Clayton. "Clarity can help issuers identify the riskiest loans, better target due diligence efforts and project and reduce prospective losses. It is one of the tools that issuers need to regain investor confidence."
About Clayton Holdings, Inc.
Clayton Holdings, Inc., headquartered in Shelton, Connecticut, is an information and analytics company serving leading capital markets firms, lending institutions, fixed income investors and loan servicers with a full suite of information-based analytics, specialty consulting and outsourced services. Clayton's services include due diligence analytics, conduit support services, professional staffing, compliance products and services, credit risk management and surveillance and specialized loan servicing services. Additional information is available at www.clayton.com.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the federal securities laws, including statements regarding the future of the ABS/MBS markets and the ability of Clayton's products to assist loan buyers and securitizers. When used, the words "anticipate," "assume," "believe," "estimate," "expect," "intend," "may," "plan," "project," "result," "should," "will" and similar expressions that do not relate solely to historical matters identify forward-looking statements. Forward-looking statements are subject to risks and uncertainties, both known and unknown and often beyond our control, and are not guarantees of future performance insofar as actual events or results may vary materially from those anticipated. Factors that may cause such a variance include, among others, those discussed from time to time in our filings with the Securities and Exchange Commission. We expressly disclaim any responsibility to update forward-looking statements.
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Source: Clayton Holdings Inc.