Use Your Automated Valuation Model like Soft Pings to Credit Reports

Do you know what a soft ping is? Many banks and FIs have massive client bases and will leverage soft pings to their clients’ credit reports to identify upsell opportunities. A soft ping is when a lender accesses a client’s credit report in order to see how it is performing after the customer has been granted credit and become a client. Soft pings are used to mitigate risk by identifying clients whose credit standing has changed and also identify upsell opportunities. Soft pings are often behind banks and FIs decisions arbitrarily to reduce a client’s line of credit limit or perhaps offer a credit limit increase.

Soft pings have done a lot to help lenders maintain better control over their receivable and risk management – but more so even to be more competitive and maintain more market share because they are able to quickly offer more credit to qualifying clients.

As important as a credit report, which evaluates a client’s history and habits, is an Automated Valuation Model (AVM) and corresponding Property Report. The AVM is a part of an automated property report but instead of focusing on the borrower, it focuses on the property.

AVMs and Property Reports help lenders to be able to do the same things – manage risk and also identify upsell opportunities. How? Because an AVM can be pulled at any point in time and can give a lender an idea of what a property is worth and what the equity positioning looks like.

This means that if a particular property or area has seen decreases in home values, lenders are primed to be able to react to these shifts. In the case of upsell opportunities, you may be able to identify refinance opportunities or even opportunities to extend secondary credit products.

For private lenders, even more so than a soft ping on a credit report (which many private and smaller lenders do not use), an AVM presents even more value. Many private and smaller lenders base their lending decisions primarily on the equity that they have in their security. A property with significantly more equity even in the case of bruised credit can = opportunity.

Secured lines of credit are a fantastic example of this. Over the years companies like Home Trust have gotten increasingly more competitive by expanding their product lines and offering more secondary products to cater to clients with additional equity and to make the most out of each and every deal. The Home Trust Secured Line of Credit is a prime example of this.

The more agile you are, the better positioned you will be to be more profitable. It doesn’t matter how big or small you are – accessing simple tools like Automated Valuation Models and Property Reports are your lowest hanging fruit as far as competing with the bigger lenders who may have access to even more!

For more about the benefits of an AVM and how to use this tool to identify opportunities for more profit, please contact Purview For Lenders today at 1.855.787.8439.