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Risk Modeling

When you as a company that lends money or extends credit, need to understand what the risk might be of lending to a particular businessman or contractor, you require information on how likely it is that you will eventually be repaid. Without that knowledge, you would be lending money blind-folded, with no certain idea of whether or not repayment is likely.

Baker, Bloomberg & Associates can help. Our company provides a service to our clients that takes into account as many relevant aspects of a potential client’s financial status as are available, and based on solid statistics can model the risk of doing business with the client. No model is infallible of course, because such mechanisms are basically predictors of outcomes, but when dealing with significant sums of money, you really want all the percentages on your side.

The best way to have an informed understanding of whether or not a potential client will repay any monies lent is through risk modeling. The process analyzes factors pertinent to the client about credit history, current indebtedness, current expenses, assets, and liabilities, and stability of the client’s business. When compared to similar historical and current scenarios, a fairly reliable estimation can be made.

If a possible client is already debt-ridden and is attempting to borrow money to satisfy other debts, this would obviously be a very high-risk kind of client, whereas a stable company with manageable debt load would be a much lower risk. Let Baker, Bloomberg & Associates provide you with the means to determine whether a client is low-risk, high-risk, or somewhere in between.