LendIT - April 2016

How Technology is Playing a Role in the Transformation of Home Loan Financing

2

Consumer Preferences Changing Rapidly

Financial Institutions Lag Behind

National Banks

16

Regional Banks

22 61

Net Promoter Score(1)

Delivery of Services is Evolving

> Find a Job

> Find a Product

> Find a Place To Stay

> Find a Restaurant

> Find a Doctor

> Find a Home

> Find a Ride

> Find Delivery

> Find a Friend

> Find a Loan

1. 2015 Net Promoter Score.

Financial services have been slow to respond, until recently

3

Consumer Expectations – By Process and Age Cohort

• Majority of consumers now prefer to be online compared to traditional methods such as in person or on the phone

• Especially true for Millennials – Remains the case for all age groups other than the Silent Generation

Source: PWC – Consumer Lending: Understanding Today’s Empowered Borrower (June ‘15)

4

Consumer Expectations – By Process and Asset Class

• Student borrowers are the most likely to prefer online applications – Reflecting the younger demographic

• Auto loan borrowers are most likely to favor a traditional lending application • Driven by the high propensity for borrowers to complete the loan application in person at a

dealership

Source: PWC – Consumer Lending: Understanding Today’s Empowered Borrower (June ‘15)

5

Millennials & Home Buying

Source: Freddie Mac: Profile of Today’s Renter Multifamily Renter Research January – February 2016

Question: In the next three years, do you expect to...?

6

Home Loan Solutions: Powered by loanDepot

Make the home loan process as easy and tech-enabled as possible, and empowering the borrower to use an omni-channel platform

REDEFINE THE CONSUMER EXPERIENCE

• No Actionable Items• Confusing Process• Lots of Paperwork• Limited Self-Service• Long Timelines

• Consumer Empowerment• Streamlined Process• Digital Information• New Underwriting • Shorter Timelines

The FutureTraditional

7

• 1st vs. 3rd Party Data• Machine Identification• Geo-location• Fraud Detection• Fast Changing Models

• Credit Report • Alternative Data Sources• Credit Underserved• FICO Score – Pros and Cons• GSE Underwriting Guidelines

Credit Underwriting ID Verification & Authentication

Technology & Risk Modeling

8 Funding Underwriting Processing Application

Emphasis on Technology & Innovation

Example: Reducing App-to-Fund Timelines Through Technology

• Digital applications •

• Hard-copy supporting documentation

•

• Imaged closing documents

• Enhanced borrower ID data collection and verification

• KBA & Digital ID Capture

• Fully automate all credit bureau information

•

• FICO, Modeled Income, Current Debts, etc…

• Property information from county recorder’s office data in real-time

•

• AVMs for fast qualification

• Income verification from W-2s, tax returns, and bank accounts

•

• Link bank accounts to borrower application

• Bringing digital experience in our personal loan product to the home loan process • Automated retrieval of borrower data, real time status, mobile first interaction and a

streamlined user experience will become mainstream in home loans

9

loanDepot’s Unique Platform

2nd largest non-bank direct

to consumer lender

Profitable since 2012

$60+ Billion funded in 6 years

$29 Billion funded in FY 2015

118% annual originations

growth(1)

Across Convenient Distribution

Channels

Providing a Broad Range of Consumer Lending Solutions

Home Loan

Personal Loan

Home Equity

In a Capital Light Model

GSEs

Institutional Capital

Banks

Cost-Efficient Lead Generation

TV

1. 12M2015 relative to 12M2014.