A Boston analytical firm has developed software to help real estate lenders evaluate loans and in some cases anticipate bank examiners' concerns.

Charter Research said its system subjects loans to stress tests to determine the likelihood of repayment of principal if market conditions change.

According to Michael Ervolini, Charter's chief executive officer, banks that make commercial mortgages for their portfolios generally stamp the loans with internal risk ratings and then rely primarily on their loan servicing systems to track performance.

Those systems are limited, Mr. Ervolini said, because they can tell the bank only what has already happened-for example, that a borrower has missed a payment. Only "major events above the surface"-a default, a well- publicized spike in vacancy rates in a property's market, the loss of a major tenant-are likely to change these internal risk ratings, he said.

But commercial mortgages generally have large "balloon" payments at the end of their terms. If a property's value slips, a borrower might still be able to make regular payments, so the bank would not take notice-until the borrower cannot make the balloon payment.

Likewise, if interest rates jump unexpectedly, or lenders' credit standards tighten after a loan is made, the borrower may be unable to get a new loan to "take out" the one coming due.

His company's software will help banks model their portfolios so they can anticipate such events, Mr. Ervolini said. It will incorporate such information as a property's current value, its operating income, banks' refinancing requirements, and projections of vacancy rates.

That will give banks more "firepower" for meetings with regulators or credit rating agencies, Mr. Ervolini said. "You'll be able to argue about why your business judgment isn't wacky."

The software will be able to analyze hundreds of loans simultaneously, reducing the costs and time needed to prepare for audits, he said.

By early summer, some of Charter's clients will have the new whole-loan portfolio software. The firm said it plans to begin marketing the system widely in the fourth quarter.

Charter, founded in 1993, is known for its Conquest system, which lets investors model bonds backed by pools of commercial mortgages.

The new product will also draw on Charter's securitization expertise, Mr. Ervolini said, using secondary market levels to help banks determine pricing-even for loans they intend to hold on their books. And it will enable banks to design their own securitizations and find whether it is more profitable to securitize a loan or hold it, he said.

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