Mortgage BPO Services

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Mortgage BPO Services A Value-Added Strategic
Alternative For Mortgage Lenders Richard G.
Thornberry President CEO MBA's 91st Annual
Convention Expo San Francisco, CA October 25,
2004
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Strategic Challenges

• Mortgage lenders will confront significant
  challenges in the post-refinance environment.
• Macroeconomics industry cycles are challenging
• Regulatory Environment complex and changing
• Financial operating and investment costs are
  high
• Technology transforming the way business is
  done
• Lack of Scale impact of mega players
• Consumer Expectations anytime/anywhere

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Consolidation of Industry Roles
Although some mega players will continue to
operate in all capacities, we expect to see
industry roles consolidate.
Customer Relationship Aggregators (Product
Distributors)
Product Transaction Platform (Transaction
Processing Specialists)
Asset Investors (Risk Managers)
Bottom linefew can be good at everything.
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The Strategic Transition
Beyond the typical build, buy, exit
strategies, lenders are increasingly considering
a broader range of strategic options.

• Joint Ventures
• Offshoring
• Outsourcing
• Business Process Outsourcing (BPO)

Consideration of BPO alternatives is becoming
strategically relevant as the urgency to address
challenges increases and credible service
providers emerge demonstrating early adopter
successes.
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Potential BPO Value To Mortgage Lenders
BPO services offer a value added strategic
solution.

• Sales expansion channel, geography,
  speed-to-market
• Cost reduction absolute, fixed-to-variable
• Cost avoidance eliminate ongoing platform
  investments
• Scale benefits operational, third parties
• Speed to market improved competitive
  positioning
• Operational improvement service, conversion,
  speed, quality
• Technology competitiveness provided by BPO
  partner
• Risk reduction operating, secondary, HR

Benefits gained through a BPO arrangement can
enable your organization to focus more on core
competencies.
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Factors in Selecting a BPO Partner

• Experience mortgage and BPO
• Commitment for the long-term
• Non-Threatening a non-competitor a non-biased
  partner
• Track Record references validating performance
• Value Added strategic and financial
• Completeness end-to-end and multi-channel
  services
• Service client and customer/member alike
• Adaptability products, programs, processes,
  scalability
• Seamless client experience and transaction
• Information transaction, secondary marketing
  and performance
• Regulatory proper licensing and compliance
  processes
• Contract warranties and service level
  agreements
• and most important, select a great business
  partner that is committed to working with you to
  build your business.

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Value Added Successes of Early BPO Adopters

• Early adopters are benefiting from BPO programs.
• 50 cost per loan reduction
• Customer satisfaction improves to gt 95
• Origination volume growth by adding high
  quality direct and web channels
• Multi million technology cost
  avoidance/reduction
• 60 days to market for new program versus 1-2 year
  internal development time
• BPO value is created by leveraging the BPO
  providers expertise while your team focuses on
  building and developing your core strategic
  differentiators.

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