The current CRE underwriting tools for B-Ds available in the market all have one problem in common – default risk assessment is just too weak.
Default risk prevention assessments are the key driver that kills 9 out of 10 transactions that make it through capacity, collateral and credit risk assessment underwriting reviews. New construction projects in the commercial real estate space are especially vulnerable because that “Alternative Investment” label that means heightened due diligence compliance audit review requirements (and higher insurance premiums) comes baked into the deal.
Your underwriters don’t have the understanding to manage the execution risk that comes with the common CRE funding structure, and will readily admit their post-funding default risk monitoring program amounts to mitigation. Mitigation is cold comfort when you have an investment fraud complaint to deal with in an environment where you don’t have the time, resources or will to devote to tackling the problem.
FINRA Demands More & Now You Can Give It
The CRE underwriting tool requirements for today’s broker-dealer simply demand more than what you can get from off-the-shelf programs and constant calls to issuers late at night to manage the latest dumpster fire. Compliance and due diligence exist because of investment fraud complaints. Our Verifier Report cuts the due diligence period down to 1 day and the cost to as little as $1,000 on CRE acquisitions, new construction financings, merchant building proposals, portfolio transactions and more. The INVIZEN system provides a library of supporting documents available for purchase to back up each Verifier Report for securities disclosures that run into the thousands of pages. This is what due diligence is supposed look like. After the transaction funds, the story gets even better with the iCREDIT system.
iCREDIT offers you an end-to-end solution that doesn’t require ongoing training, doesn’t require special skills, doesn’t require a huge investment and provides proactive prevention of defaults that can lead to investment fraud complaints that you cannot afford. That’s what iCREDIT provides…
iCREDIT is the seamless solution that allows a single point of control for valuation analysis, feasibility, capacity, collateral, credit and default risk assessment in near real-time that provides the level of documentation that even the pickiest auditor will appreciate. The process continues in the post-funding environment with our financial reporting system that eliminates fraud and embezzlement as potential outcomes, while still providing additional business intelligence that allows for safe landings and profit-taking opportunities to be realized before the dumpster fire happens. That’s what iCREDIT provides…
iCREDIT is more than software – it’s the end-to-end solution that takes on a transaction wherever the business is in its life cycle. iCREDIT supports the complete securities offering due diligence process requirements and provides proactive defense against future investment fraud complaints that you are sure to like. This means the costs of compliance, insurance and other G&A costs can finally come down. This means the opportunity to complete more transactions with confidence can finally increase.
Find out what that’s worth to your firm by calling us to learn what a net zero cost of service can mean for the entire holding period of the security. You have the tools if you want them.