Welcome to The S-Curve
Now you will be able to receive the latest announcements, product updates, and our insights on the mortgage market in real time.
The name of the blog, the S-Curve, is a reflection of our logo and the central feature of our prepayment model. S-curves are seen in nature in many phenomenon, from population growth to prepayment and default models. Our first S-curve, in the early 1990s, used the arctangent function, then piece-wise linear functions, and evolved over time to be more complex and vary by FICO, loan size and LTV. This evolution encapsulates both the timeless nature of fundamental relationships and constant innovation to describe them better over time.
We hope you find the information useful and we look forward to your feedback.
-
Agency LDM+ Available in Milliman M-PIRe™ProductsAndrew Davidson & Co., Inc (AD&Co) is thrilled to announce an expanding relationship with a Third-Party Vendor! AD&Co enjoys working with countless analytical providers to offer our clients seamless solutions and we would like to welcome Milliman M-PIRe™ to the team!
Milliman’s Integrate Solutions have supported AD&Co’s LoanDynamics Model (LDM) for many years. We've expanded on that relationship to include Milliman M-PIRe™ software. Milliman M-PIRe™ now supports AD&Co’s Agency+ LoanDynamics Model (Agency LDM+) to offer clients an industry-leading solution. AD&Co’s Agency LDM+ forecasts prepayments, delinquencies, defaults and loss probabilities, which are fed into Milliman M-PIRe™, a valuation and securitization software that produces advanced analytics of structured mortgage credit risk (CRT).
Today’s financial markets have taught us the importance of evaluating and managing financial risks. Milliman’s integration of AD&Co’s Agency LDM+ into the M-PIRe™ solution allows reinsurers and mortgage insurers to analyze CRT transactions using a multi-model framework when implementing risk and portfolio management strategies.
AD&Co would like to thank Milliman for their unparalleled support of our Agency LDM+ in the M-PIRe™ software. We truly appreciate their dedication to servicing mutual clients to ensure their success.
Interested in learning more about joint Milliman M-PIRe™ and Agency LDM+ solution? Please contact Jonathan Glowacki at jonathan.glowacki@milliman.com.
The S-Curve Archives
-
ThoughtsIn our January 19th blog entitled, A More Equitable Lending System Will Not Be Created by Accident, we described the efforts it will take to overcome not just bias in lending today, but the systemic factors that have limited access to credit in the past and have created an unjust system.
-
ThoughtsIn this short blog post I discuss some developments taking place in the flood insurance landscape in the US and look ahead at a few potential directions things could go. I suggest that universal catastrophic flood insurance coverage with a continuation of the introduction of risk-based pricing would be a significant improvement.
-
ThoughtsIntroduction
The Government-Sponsored Enterprises (GSEs) entered conservatorship in September 2008. One could view the succeeding thirteen years as a journey back to financial stability with a refined operating model that looks more like a financial utility than a hedge fund. This business model is more compatible with a fair lending mission for a standard-setter that maintains secondary markets under an effective regulator. The GSEs remain the largest part of the housing finance backbone and a resilient funding source during economic stress.
-
Thoughts
Around 75% of white American families were homeowners in the first quarter of 2020, according to data from the United States Census Bureau. However, only 44% of Black American families owned their homes at the same time.
-
Thoughts
According to a report by the Research Institute for Housing America, climate change risk is rapidly increasing in the housing industry and will continue to demand more attention and regulation in the near future.
-
Thoughts
Mortgage market participants are keenly aware that the Federal Reserve has been scaling back its UST and MBS purchases and factoring the outcomes of its actions on stakeholders across markets.
-
Thoughts
The growing prevalence of artificial intelligence in the mortgage industry is shining a new light on the human biases that have pervaded the industry since its inception. AI is meant to bring fairness and objectivity to mortgage decisions, but it can’t perform fairly if it was built on an unfair system.
-
Products
The LDM v3.0.2 library adds AutoLDM to the v3.0.1 library.
Key benefits include:
-
EventsWe at Andrew Davidson & Co., Inc. (AD&Co) are once again thrilled to celebrate Pride Month, especially the contributions of LGBTQ professionals in the field of finance including affordable housing policy and the GSEs. This year, in addition to celebrating, we are also paying increased attention to the challenges that LGBTQ individuals face, particularly around issues of housing. Our pride in our LGBTQ staff and community sits alongside our concern about discriminatory lending practices, including in mortgages. As of February 2021, for the first time, lesbian, gay, bisexual, transgender, queer, and questioning (LGBTQ) Americans will be protected from housing discrimination under the Fair Housing Act.
-
News
For several years, AD&Co has tracked the total rate of return (TRR) performance of the GSE CAS and STACR CRT in its U.S. Mortgage High-Yield Indices. The AD&Co Mid-Tier index constitutes a broad market measure of the TRR performance of GSE CRT. The related sub-indices segregate the CRT market into 4 index Tiers by attachment point, reflective of the credit exposure of the various classes of underlying CRT ranging from B to M1.