- Valuations and Advisory
- Loan Valuations
A number of national and international banking groups use the Praxi Loan Valuation service.
Praxi mortgage loan appraisals are in conformity with international standards and national regulations governing the sector. In fact, PRAXI subscribed to the ABI Guidelines right from their publication for the valuation of real estate collateral against credit exposure.
Appraisals determine the market value of properties for collateral purposes and the cost of reconstruction (new-for-old-value) for insurance cover. This approach not only supports the normal disbursement of credit process, but also helps to “certify” the appropriateness of real estate collateral values, also in relation to rating agencies and investors, in the case of subsequent securitisation operations.
To ensure the overall quality and prompt service carried out, we developed a whole series of systems and procedures relevant to process control, validation and monitoring, which is the sound added value that Praxi Loan Valuations offers to banks, besides the significant advantage associated with the outsourcing of the practical and organisational aspects. This is particularly important in the current phase of evolution and centralisation regarding banking system supervision given the importance new regulations place upon the reliability of appraisals with respect to the determination of the extent of risk taken on by banks.
The distinctive elements of our service are:
- centralised systematic control of each appraisal, focused on the fair value, significance and correctness of the descriptive and identifying elements of the property, in formal compliance with the schemes established
- continuous implementation of the values database, managed through a georeferencing tool
- systematic tracking of each step of the procedure and the control systems to ensure compliance with timing
- PRAXI’s professional responsibility for each aspect of the process
- systems of reporting to banks.
Praxi Loan Valuations has a dedicated IT platform to support the entire process, fully developed by Praxi IT Division experts. The platform is highly specialised, having been designed specifically for Praxi Loan Valuations activities, as well as a complete range of tools including a georeferencing system that allows the optimal use of the real estate values database. An advanced disaster-recovery system ensures data protection and business continuity for client banks.
The valuation of properties for leasing operations is in common with the parellel activity to support mortgage lending by banks, although there are some differences due to certain specific features of the leasing contracts.
The main difference that directly and significantly affects valuation activities is that the leasing company becomes, to all intents and purposes, owner of the property until expiry of the contract and redemption by the borrower (who, contractually, may not choose redemption, and threrefore ownership remains with the leasing company).
The financial commitment (tie-up of capital) and legal responsibility linked to property leasing are relevant, and the appraisal drafted at the preliminary examination stage must take full account not only of the most essential appraisal aspects but also of issues concerning ownership, in compliance with urban planning and building regulations, certification of systems and environmental protection etc.
PRAXI offers client leasing companies a dedicated, professional team with a full range of skills necessary to tackle the issues set out above.
For the management of the appraisal process and interaction with corporate clients, from initial assginment to delivery of the completed appraisal, Praxi Loan Valuations has a dedicated IT support platform, fully developed by Praxi IT Division experts. The highly specialised platform, having been designed specifically for Praxi Loan Valuations activities, has a complete range of tools including a georeferencing system that allows the optimal use of the real estate values database. An advanced disaster-recovery system ensures data protection and business continuity for client banks.
As regards appraisal content and format, PRAXI normally operates according to the Assilea standards, but it is at the leasing companies’ disposal to implement any customisation and specific requests they may have, to ensure the service responds fully to client needs.
Thanks to our widespread presence on the national territory, with ten offices in Italy, and the professional skills of our appraisal experts, PRAXI is able to conduct appraisals on properties of any size or type, located anywhere in Italy, ensuring a consistent approach, fair value and respect to timing.
PRAXI also carries out leasing operations “under construction”, both at the preliminary examination stage and throughout the entire building process, drafting regular progress reports before verifying the correct completion of the work in full compliance with the pertinent regulations.
PRAXI assists lenders and investors specialised in technical/financial analysis and verication of the feasibility and sustainability of optimisation options of properties under non-performing mortgage loans and leasing contracts.
As the economic crisis worsens and persists, the volume of impaired and non-performing loans constantly grows, and judicial proceedings therefore call for much longer time, with an outcome that is highly unsatisfactory for creditors.
PRAXI’s wide-ranging skills in the real estate sector allow clients to be offered not only standard real estate valuation and due diligence services, but also and above all custom-made assistance that is very finely attuned to real, practical solutions in collaboration with the borrower where the necessary conditions exist.
Thanks to its widespread presence all over Italy, PRAXI is able to analyse quickly large NPL portfolios and according to analysis and sampling criteria in order to optimise the use of resources, thus ensuring the appropriateness and reliability of results.
At the same time, we are able to develop prompt and in-depth analyses of individual properties, examining all optimisation possibilities and opportunities, and advising clients on the path towards greater success and prospects for the best return on investment.