Method and system for automated property valuation adjustment
First Claim
1. Machine-readable media having program code stored therein, the program code being executable by a processor to perform a method for estimating property values, comprising:
- obtaining a first estimate of a property value from a first property valuation database, the first estimate exhibiting time lag bias due to a time lag between collection of property value data used by the first property valuation database and generation of the first estimate by the first property valuation database;
obtaining loan application data from an underwriting engine, the loan application data being for loans that have not closed at the time the loan application data was received by the automated underwriting engine, the loan application data including sale prices;
deriving a time lag adjustment factor based on the sale prices; and
adjusting the first estimate to reduce the time lag bias using the time lag adjustment factor, by a valuation adjustment scheme logic implemented by the instructions stored in the machine-readable media, thereby providing a second estimate having reduced time lag bias.
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Abstract
A method and system are provided removing systematic bias from property value predictions obtained using automated property valuation models. The systematic bias is removed by deriving monthly adjustment factors that are location-specific. The monthly adjustment factors are obtained by comparing newly obtained purchase transaction data to model-generated valuations of properties in a base valuation database. The newly obtained purchase transactions may be obtained from newly obtained data on recently completed purchase transactions and loan application data on future purchase transactions. The monthly adjustment factors are applied to the property valuations in the base valuation database to obtain adjusted property values having reduced bias and thus improved accuracy.
82 Citations
28 Claims
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1. Machine-readable media having program code stored therein, the program code being executable by a processor to perform a method for estimating property values, comprising:
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obtaining a first estimate of a property value from a first property valuation database, the first estimate exhibiting time lag bias due to a time lag between collection of property value data used by the first property valuation database and generation of the first estimate by the first property valuation database; obtaining loan application data from an underwriting engine, the loan application data being for loans that have not closed at the time the loan application data was received by the automated underwriting engine, the loan application data including sale prices; deriving a time lag adjustment factor based on the sale prices; and adjusting the first estimate to reduce the time lag bias using the time lag adjustment factor, by a valuation adjustment scheme logic implemented by the instructions stored in the machine-readable media, thereby providing a second estimate having reduced time lag bias. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23)
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24. A system for adjusting property valuations for bias, comprising:
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a processor; and memory operatively coupled to the processor, the memory containing program code for configuring the processor to obtain a first estimate of a property value from a first property valuation database, the first estimate exhibiting time lag bias due to a time lag between collection of property value data used by the first property valuation data base and generation of the first estimate by the first property valuation database, obtain loan application data from an underwriting engine, the loan application data being for loans that have not closed at the time the loan application data was received by the automated underwriting engine, the loan application data including sale prices; derive an adjustment factor using the sale prices, apply the adjustment factor to the first property estimate to reduce time lag bias, thereby providing a second property estimate having reduced bias. - View Dependent Claims (25, 26, 27)
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28. Machine-readable media having program code stored therein, the program code being executable by a processor to perform a method for estimating property values, comprising:
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receiving loan application data for a first plurality of properties from an automated underwriting engine, the loan application data being for loans that have not closed at the time the loan application data was received by the automated underwriting engine, the loan application data including a plurality of purchase values; and generating a plurality of property value estimates for a second plurality of properties based on the plurality of purchase values for the first plurality of properties received from the automated underwriting engine.
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Specification