Normalising Common Components
To achieve standardisation across products and asset classes, the CDM identifies logical components that fulfil the same function and normalises them, even when those components may be named and treated differently in the context of their respective markets. We followed the CDM design principle of normalising concepts such as quantity, price and party in the representation of financial transactions.
The CDM identifies that, regardless of the asset class or product type, a financial transaction always involves two counterparties trading (ie buying or selling) a certain financial product in a specific quantity and at a specific price. This approach means that a single logical concept such as quantity can represent concepts that may be named and captured differently across markets: eg notional or principal amount etc.
Following this approach, we took the modular components that exist in the CDM and reused concepts such as product, loan, price, collateral and party to reflect the mortgage attributes that characterised loan, borrower and collateral. We also extended the model to reflect attributes that were specific to the POC around collateral (eg property) or the credit profile of the borrower (eg credit details).
JSON Representation of Retail Mortgage Model