Advantages and Disadvantages of Open Source Data Modeling Tools

Using open source data modeling tools has been a topic of debate as large organizations, including government agencies and financial institutions, are under increasing pressure to keep up with technological innovation to maintain competitiveness. Organizations must be flexible in development and identify cost-efficient gains to reach their organizational goals, and using the right tools is crucial. Organizations must often choose between open source software, i.e., software whose source code can be modified by anyone, and closed software, i.e., proprietary software with no permissions to alter or distribute the underlying code.

Mortgage Insurance and Loss Severity: Causes and Effects of Mortgage Insurance Shortfalls

This blog post is the first in a two-part series about Mortgage Insurance and Loss Severity. During the implementation of RiskSpan’s Credit Model, which enables users to estimate loan-level default, prepayment, and loss severity based on loan-level credit characteristics and macroeconomic forecasts, our team explored the many variables that affect loss severity. This series will highlight what our team discovered about Mortgage Insurance and loss severity, enabling banks to use this GSE data to benchmark their own MI recovery rates and help estimate their credit risk from MI shortfalls.