SAN FRANCISCO, CA, Feb. 16, 2005 -- LoanPerformance, a leader in residential mortgage data and analytics serving the mortgage industry and Wall Street, today announced the availability of version 3.1 of its RiskModel forecasting tool for mortgage default, losses, prepayment and delinquency.

RiskModel 3.1 features new statistical models for Alt-A and prime loans and delivers dramatic improvement in performance based on back-tests of over 4 million loans and over 1700 securities. Enhancements to these new models include:

-- Addition of a 12-month loan payment status history string as an optional input

-- Addition of a new payment shock variable for ARMs

-- Explicit modeling of teaser rates

-- Specific effects for prime condos and 2-4 units that dampen prepayments

-- Explicit modeling of the impact of housing price appreciation on prepayments

-- Revision of the refinance incentive from the relative spread to the present dollar value of refinancing -- a function of loan size, interest rates, coupon, and prepayment penalty.

"The scale of the validation was the largest we have ever undertaken and our top priority since dozens of our clients depend on our forecasts to make critical business decisions," said Alan Neale, director of analytics at LoanPerformance.

"These models leverage the industry's most in-depth datasets and some of the best modelers in the industry," said Ralph DeFranco, Ph. D., RiskModel product manager at LoanPerformance. "Our goal is to predict the future rather than match or 'over-fit' the past."

DeFranco said that he expects the RiskModel to continue to dominate the market for high-end credit and prepayment risk forecasting.

About RiskModel 3.1

LoanPerformance RiskModel 3.1, a Windows-based software program, is the only commercially-available model that simultaneously considers both prepayment and default risk while integrating the effects of borrower behavior, interest rate fluctuations, and housing price movements on residential mortgages. Its independent projections enable institutions to more accurately set loan loss reserves and to perform a full spectrum of risk management processes including: portfolio grooming, risk-adjusted pricing, cash flow projections, valuation of securities or insurance, loss mitigation, asset and liability management and hedging, and the negotiation of appropriate coverage on securitization and guaranty fees.

About LoanPerformance

LoanPerformance is a leader in residential mortgage performance data and credit risk decision support tools for mortgage originators, servicers, securities issuers and investors. LoanPerformance's industry-standard mortgage servicing and securities databases track the delinquency and prepayment performance of 46 million individual mortgage payments per month and provide loan-level information on over $850 billion in non-agency mortgage and asset- backed securities. LoanPerformance's proprietary databases and suite of predictive prepayment and risk modeling solutions enable clients to make informed business decisions about credit risk, loss mitigation, customer retention, securitization and investment. For more information visit http://www.loanperformance.com.

LoanPerformance and RiskModel are trademarks of LoanPerformance.

For more information about RiskModel, 
please call the LoanPerformance
representative in your area: 
West - Jim Kinnebrew  (415-536-3523) 
Midwest - Charles DiMascio (909-593-0141) 
NY to DC Corridor - Connie Keim  (973-226-0084) 
New England, PA, OH - Brian Gunn  (415-536-3537)
Southeast - Debra Donan(908-304-0263)