Advanced Resource Computers Systems Inc., a provider of Internet-based automated underwriting and technology for risk-based pricing, has been tapped by the Virginia Housing Development Authority, a state housing finance agency, to underwrite two high loan-to-value loan programs.

Though this pricing technology is in its early stages, ARC expects to be dealing in the mortgage and asset-backed arenas in the next six months, a spokeswoman for the company said.

"In this case it doesn't deal with asset-backeds because they're using the funds from bond sales to actually fund the program but we do have other clients that will be using this ARC technology ... for their asset-backed securitizations," explained Mary Tipps, marketing director for the company.

Tipps also mentioned that First Franklin Financial and Option One Mortgage Holdings will be two of the clients using the program for due diligence related to upcoming securitizations.

"They have signed contracts with us and essentially, the ways it works is, we take their underwriting guidelines and we build what I call decisioning trees'," said Tipps.

"So that at the point-of-sale, they are able to take applications and render a decision to include risk-based pricing...so that then they could plan, at the point-of-sale, for certain securititization grading or stratification," she added.

Currently, Texas-based ARC is the only company offering such a program. Founded in 1984, the company provides more than 80 financial institutions with the opportunity to make fast, accurate and consistent decisions at the point-of-sale for risk-based pricing and credit evaluation.

With the new technology, it is expected that the company's clientele list will increase in the next few years, Tipps said.

"We've spoken to several houses on Wall Street about the utilization of our system," she said. "As you know, the Internet mortgage business is moving so rapidly; it's a matter of taking a step back and putting more attention to it."

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