The production of the collateral risk underwriting analysis under the INVIZEN RTU model is also subject to certain other considerations that make the INVIZEN RTU both unique, but also a departure from many current practices. The reasoning behind this election is that failures still routinely occur resulting in materially-significant losses for both lenders and investors – with investors in the given transaction failure being forced to absorb a total loss of investment in many instances. The core tenant of the INVIZEN system is to both increase the propensity for a better decision-making outcome, while at the same time providing a higher level of investment outcome protection by providing an end-to-end solution that does not stop with underwriting, but follows the transaction throughout the entirety of the holding period of the securities at issue.
To realize the goal of providing this end-to-end solution for capital market participants and the totality of the financial stakeholders in these transactions, a departure from some of the current practices is a fundamental requirement, as this all comes back down to the supporting Ideal Development Profile requirements and the attending machinations that must be undertaken to remain within that operating envelope represented by the Ideal Development Profile. The goal of all market economy businesses is the same: provide the market of consumers with what they want, when they want it and at a price they are willing to pay. Deviation from this requirement creates risk and the supporting Ideal Development Profile is designed to provide the issuer with a “road map” designed to help the issuer maximize their market opportunity in light of adhering to the Ideal Development Profile as closely as possible on an ongoing basis. This is a likely outcome as the end-user/consumer of the product(s) and/or service(s) at issue can be reasonably expected to continue to act in deference to Rational Choice Theory at all times and levels of decision-making.
Accordingly, appraisals and other related due diligence documentation efforts may be compromised on an ongoing basis, as the result is frequently increased loss severity risk due to appraisals that are compromised due to the fact the appraiser is not cognizant of the market feasibility issues, nor is the appraiser routinely expected to consider these market feasibility issues. As a result, the INVIZEN collateral risk underwriting approach focuses on the outcome of the market opportunity analysis, as the market opportunity analysis logically results in a revenue forecast that becomes the basis of valuing the collateral at hand. This is due to the fact that as long as the market opportunity continues to exist and/or grow, the value of the business to the capital markets – all other things being equal – will also exist and grow. This provides the underlying support that forms the basis of the INVIZEN collateral risk underwriting analysis.