VeroPRECISION: Valuation Decision Engine
The Complete End-to-End Valuation Solution For Second Mortgages And Home Equity Lending
Veros Real Estate Solutions introduces property-level AVM decisioning with VeroPRECISION™, its groundbreaking Valuation Decision Engine. VeroPRECISION runs an AVM on a subject property only after determining the property is best served by automated valuation. If not, it orders a desktop valuation or appraisal instead from a provider designated by the lender.
VeroPRECISION: The 70 percent solution
Thorough testing has shown that AVMs are an intelligent, economical and efficient valuation choice for between 70 and 80 percent of residential properties nationwide. VeroPRECISION saves lenders time and avoids unnecessary fees by running an AVM when it's right. It operates on these three principles:
- Not all properties are suitable candidates for AVM use.
- Eliminating non-suitable properties significantly increases AVM accuracy.
- Eliminating valuation outliers from the AVM pool increases client satisfaction.
The next-generation “cure for the common cascade”
- VeroPRECISION begins by generating a property-level AVM Suitability Score using case-based reasoning, data-driven automation and sophisticated data analysis.
- When an AVM is determined to be the best valuation method, it automatically orders automated valuations from Veros’ own VeroVALUESM and Collateral Analytics®’ CA Value MC, both of which are well established as the industry’s top-performing AVMs.
- VeroPRECISION’s integrated Artificial Intelligence (AI) engine then scores the AVMs at a property level (versus state or county level), and returns the more accurate and stronger of the two in a report with full supporting data analysis.
Although AVM cascades represented “best in class” thinking for the first decade of this century they don’t typically generate a property-specific valuation, but instead use rules and criteria typically generated at a county or state level. Also, traditional cascades were never intended to address whether the property was appropriate for AVM use.
By identifying AVM-suitable properties and addressing accuracy disparities and usage suitability concerns, VeroPRECISION removes outliers from the equation and raises AVM accuracy and usability. Through exclusive use of AVM brands consistently identified as the most accurate, VeroPRECISION delivers the next-generation cascade solution as a “cure for the common cascade.”
Help for Second Mortgages and Home Equity Loans
Rising interest rates and historically high levels of residential equity have made HELOCs and second mortgages increasingly popular and VeroPRECISION, with its complete, end-to-end solution for home equity and second mortgage lending, has special value for this market segment.
Any valuation approach can have disparities between purchase transactions and non-purchase or refinance transactions, so when lenders implement AVMs in production that are based only on purchase transaction testing they can get inconsistent results for HELOC and refinance production. By contrast, VeroPRECISION has been tested against both transaction types to ensure that the results in the actual production environment align with those experienced during testing.
Veros’ AVM Suitability Score Engine
The AVM Suitability Score generated by VeroPRECISION is different than the AVM Confidence Score, which measures the degree of variability associated with the point value estimate of the AVM. Instead, the Veros AVM Suitability Score looks at the subject property, including the immediate environment, and makes some basic assessments:
- How much does the AVM know about the subject property’s physical characteristics from both public records and MLS data?
- Is the subject property similar to other recently sold properties in the immediate area?
- Are there recent sales and listings for similar properties near the subject?
In addition, property condition report (PCR) products are available as an automatic add-on for clients who want photographic documentation to accompany the property’s valuation. Assessing the property condition is critically important as lenders must know the current condition of the subject property in order to accurately assess its value, particularly in light of ever-present “natural disasters.”
For your convenience, clients can customize their order preferences to ensure that their processes are consistent across their portfolios.
VeroPRECISION Keeps Improving
Veros and our customers work together to ensure VeroPRECISION's effectiveness. In quarterly VeroPRECISION testing reports sent to customers, we detail hit rates and value accuracy for suitable properties versus non-suitable properties. Customers are encouraged to provide the recently appraised values for their subject properties so that Veros can append VeroPRECISION values.
This allows for the comparison of testing performance and actual production performance and is ideal for validating customer’s unique footprint and risk tolerances.
When an AVM is not the solution
Those subject properties that require appraisal or evaluation services can be immediately escalated to one of the following four evaluation options, based on the customer's expressed preference:
- A desktop valuation performed by a certified appraiser
- A desktop valuation performed by a highly trained analyst
- A desktop valuation with exterior inspection performed by a certified appraiser
- A desktop valuation with exterior inspection performed by a highly trained analyst
Order through the VeroSELECT platform
Whether an AVM is best or another method is required – Veros, through its VeroSELECT online ordering and management platform, has the right tools and best vendor support to provide complete valuation solutions for this market.
VeroPRECISIONSM is ordered through VeroSELECTSM, Veros’ centralized, online ordering and management platform. VeroSELECTSM also integrates VeroPHOTO Plus, which allows a client to set the AVM order to automatically request a property condition report (PCR) when needed to validate the rendered value with digital photographs that show the subject property's condition.
Veros’ suite of valuation-related risk management solutions also includes VeroVALUESM AVM, AVM cascades, VeroBPOSM Broker Price Opinions (BPOs), VeroPHOTO Plus Property Condition Reports (PCRs), full appraisals and evaluation services, and VeroFORECASTSM, a valuation tool that forecasts property values six, 12, 18 and 24 months into the future.