Property Valuation Using Credit Score Indicators

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Solution Overview

Problem

Existing valuation methods, such as automated valuation models (AVM), drive-by appraisals, and desk reviews, lack the ability to determine a property's condition, which is crucial as structures age, making it difficult for lenders and insurance companies to accurately assess property value without a complete inspection.

Innovation Solution

A computer system that uses a database to obtain credit scores for property owners and previous owners to create an ownership responsibility indicator, which serves as a proxy for the property's condition, allowing for a more accurate valuation by adjusting the initial value or value range based on the indicator.

Engineering Contradictions & Design Principles

VSEngineering Contradiction Analysis

1Productivity

If automated valuation models and drive-by appraisals are used, then valuation speed and efficiency are improved, but the ability to determine property condition deteriorates

Engineering Contradiction:

Improvevaluation speedVSAvoidproperty condition determination

Core Design Contradiction:

ProductivityVSMeasurement precision

Solution Approach 1:

The patent introduces credit scores as an intermediary indicator to indirectly assess property condition. Instead of directly inspecting the property, the system uses the owner's credit score history as a mediator to infer maintenance responsibility and property condition, thereby maintaining fast automated valuation while gaining condition insights

Inventive Principle:

Principle #24Intermediary (Mediator)

Solution Approach 2:

The patent replaces the mechanical inspection process with an information-based system that retrieves and analyzes credit score data from databases. This substitution eliminates the need for physical property inspection while still providing condition assessment capabilities through alternative data sources

Inventive Principle:

Principle #28Mechanics substitution (Replace mechanical system)

2Measurement precision

If a complete inspection is performed, then property condition determination accuracy is improved, but time consumption and cost increase

Engineering Contradiction:

Improveproperty condition determinationVSAvoidinspection time

Core Design Contradiction:

Measurement precisionVSLoss of time

Solution Approach 1:

The patent extracts the essential information needed for condition assessment (owner responsibility indicators) from the complete inspection process by using credit score data. This extraction allows the system to obtain condition-related insights without performing the full inspection procedure

Inventive Principle:

Principle #2Taking out (Extraction)

Solution Approach 2:

The patent applies partial action by using only the credit score component of owner history rather than conducting a complete property inspection. This partial approach provides sufficient condition determination accuracy for valuation purposes while significantly reducing time and resource requirements

Inventive Principle:

Principle #16Partial or excessive action

Data Source

PatentUS8494972B2Valuation using credit score

Publication Date: 2013.07.23 NYTELL SOFTWARE LLC

AI summary

A method of appraising the value of a property based on obtaining a credit score of an owner of a property and assigning an ownership responsibility indicator to the property. The ownership responsibility indicator provides insight into the condition of the property without performing a complete inspection. A more accurate value of the property can then be determined.