Our approach blends quantitative discipline with qualitative, narrative‑driven “pre‑mortems”. By integrating abductive reasoning, we uncover the real pathways to potential loss and the actions that genuinely strengthen underwriting.
In this paper, we cover:
- The dangers of mistaking metrics for reality: why the “map” isn’t the “territory”
- The flaws built into widely used measures such as LTV, debt yield and ICR
- How Goodhart’s Law affects credit decisions
- The value of abductive reasoning and structured pre‑mortems in private credit
- How large language models are enhancing scenario analysis and qualitative assessment
- Why a dual system pairing quantitative rigour with narrative analysis creates a more honest, forward‑looking view of credit risk
Private Markets Insight: Rethinking real estate credit underwriting
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