Patent ID: 8706604

Claim:
A computer-implemented method for hedging risks in a commercial lease, the method comprising: receiving at a computer processor information from a database, the information related to a lease agreement between a lessor and a lessee, the lease agreement calling for the lessor to lease an asset to the lessee for a period of time in return for lease payments; estimating, using the computer processor, potential losses that the lessor will suffer if at least one credit event causes the lessee to default on the lease agreement, the potential losses including one or more types of losses selected from a group consisting of: a loss of the lease payments, a loss of residual value of the leased asset, and other financial losses associated with the lease agreement; providing the lessor a put option, whereby, upon the at least one credit event, the lessor can choose to sell a claim against the defaulting lessee at a strike price, the strike price being an amount that varies based at least in part on the estimated potential losses calculated by the computer processor and the time at which the lessee defaults, wherein the put option is exercisable prior to a judicial confirmation or modification of the claim; receiving, by the lessor, a payment at the strike price pursuant to the put option; and adjusting the payment based at least in part on a judicially confirmed or modified claim amount.