Using A Lending Platform In The Cloud To Serve Your Members

1. Using A Lending Platform In
The Cloud
To Serve Your Members
Jorge Sauri
Chief Technology Officer
Mortgage Dashboard
jorges@mortgagedashboard.com

2. Session Goals
o Understanding Mortgage Market Conditions.
We’ll take a look at the current mortgage banking environment
and why it is a good time for credit unions to grow their real
estate lending presence.
o Learn the basics behind Cloud Computing.
Find out how the cloud computing works and why your credit
union software platforms need to be full web enabled and run
from a cloud.
o Discover the benefits of using a Cloud based lending platform.
Learn how to improve your members lending
experience, manage regulatory compliance and achieve positive
return-on-investment by using lending technology built for the
Cloud.

3. Part 1: Mortgage Market
Conditions

4. The Residential Mortgage Market –
Growth & Opportunity
o Mortgage Bankers Association early forecasts for 2012 were
under $1 trillion in residential home mortgages; September
2012 forecasts now put it over $1.4 trillion and continuing
to exceed $1 trillion in 2013.
1.60
1.40
1.20 2012 Total
1.00 Originations
0.80 Purchases
0.60
0.40
Refinances
0.20
0.00
Jan 2011 Sep 2012
Forecast Forecast

5. The Residential Mortgage Market –
Growth & Opportunity
o Nationwide home values increased 4.6% in Aug 2012 as
compared to August 2011 – biggest increase in 6 years.
Home Price Index Increase / Decrease
CoreLogic Sep 2012
5.00%
0.00%
Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 -5.00%
Aug-12
-10.00%
-15.00%
-20.00%

6. The Residential Mortgage Market –
Growth & Opportunity
o Historic low rates with
30 year fixed around
3.5% and 15 year
under 3%, refinances
continue to boom and
purchases are on the
rise.

7. Credit Unions and The Residential
Mortgage Market
o Credit unions originated $56 billion in residential mortgage
loans in the first 6 months of 2012. This represents about 1/3
of credit union total loan origination and less than 8% of all
residential mortgage loans in the U.S. So there is opportunity
for more growth!

8. Credit Unions and The Residential
Mortgage Market
o Credit unions sell just over ½ of the mortgage loans on the
secondary market. However, studies show that institutions
which sell residential mortgage loans see greater income and
profits with 257 basis point gains in Q2 2012.
o MBA reports that profits on residential mortgage lending rose
from $1,654 in Q1 2012 up to $2,152 in Q2 2012.
o According to the American Customer Satisfaction Survey
(ACSI) survey last year, members are more satisfied then ever
before with credit unions, as the industry’s score soars 8.7% to
87 (on a scale of 0 to 100)—the highest score ever reached by
any of ACSI’s 47 industries.
o In just one year, credit unions have tripled their ACSI lead over
banks.

9. Future Challenges in Mortgage Banking
o The industry is going through unprecedented changes
with the ongoing implementation of Dodd-Frank and
the establishment of CFPB and future GSE reform.
o While CFPB does not have direct oversight over most
credit unions, the credit union industry need to
follow the rules established by the CFPB regarding
financing.
o TILA modifications (new APR calcs), RESPA reform
(new documents), SAFE Act (licensing of
originators), Risk Retention (limits on loan sales) all
will require credit unions to have leading edge
technology to stay compliant.

10. Summary on Mortgage Market
Conditions
o Forecasts and analysis show that
real estate and residential
financing is making a rebound.
o Mortgage Banking is profitable
when done properly.
o Credit Unions have room to grow
with greater consumer confidence
and current low market share.
o Regulatory change will present
challenges that can be overcome
with proper flexible and compliant
technology.

11. Part 2: Cloud Computing

12. What is Cloud Computing?
o Cloud computing is Internet-based
computing, whereby shared resources, software, and
information are provided to computers and other
devices on demand, like the electricity grid. In other
words, Cloud computing refers to anything that
involves delivering hosted services over the internet
and encompasses any subscription-based or pay-by-
use service that, in real time, extends IT’s existing
capabilities.

13. What is Cloud Computing?

14. What is Cloud Computing?
o Cloud computing is where entire businesses and
thousands of employees will run their computer tools
as online rented products. All of the processing work
and file saving will be done "in the cloud" of the
Internet, and the users will plug into that cloud every
day to do their computer work.

15. What is Cloud Computing?
o The primary benefit of cloud computing is reduced
cost for everyone involved. Software vendors do not
have to spend thousands of hours supporting users
over the phone... they would simply maintain and
repair a single central copy of the product online.
Conversely, users wouldn't have to shell out the large
up-front costs of fully purchasing word
processing, spreadsheet, or other end user products.
Users would instead pay nominal rental fees to access
the large central copy.

16. What Cloud Computing is Not?
o Cloud computing is not your corporate data center. If
you own the infrastructure. It's your network, your
hardware, your infrastructure.
o Cloud computing is not what you do at a datacenter
that you contract with. Whether that be a colocation
datacenter or a managed hosting datacenter. If you
have to specify that hardware you want to use, if you
direct the procurement activity, it's not cloud
computing. That's either colocation or managed
hosting - respectively.

17. Examples of Cloud Computing in Your
Everyday Life
o Email on the go – Google /
Yahoo
o Local Data Storage - Data
stored on your home or
business computer suffers
from many of the same
restrictions as email and, as with email, the cloud
offers a solution. Storing your MP3′s, video, photos
and documents online instead of at home gives you
the freedom to access them wherever you can find the
means to get online.

18. Examples of Cloud Computing in Your
Everyday Life
o Collaboration - On occasion you may find yourself in
need of the collaboration with your peers.
Downloading files onto flash memory, emailing
documents to friends or family or colleagues is
inefficient and time consuming. Last year Google
launched a service that allowed groups of people to
work on the same document, idea or proposal in real
time or whenever convenient to each participant.
o Mobility is the new internet – Books, Music and
Wallet are becoming software

19. Part 3: Using A Cloud
Based Lending Platform

20. Benefits of the Cloud in Lending
o The complexity and duration of the mortgage banking
transaction makes it an ideal process for the Cloud.
o Let’s look at each step in the typical mortgage process
and discuss how greater efficiency can be achieved by
using cloud based technology.

21. General Benefits of the Cloud in
Lending
o No data server is required for the credit union.
o No software needs to loaded locally on PCs and
devices.
o Any PC, tablet or mobile device can access the
pipeline – anywhere, anytime.
o Central system administration of the process as no
data is stored locally and all information can be
viewed from anywhere, anytime.
o Centralized lending systems have proven to reduce
mortgage process expenses by over 30%.

22. Benefits of the Cloud in Originators
o Loan originators have the ability to take a loan
anywhere from any device that has an available
internet connection from your office to member
homes to real estate agencies to even construction
sites via a tablet or satellite modem.
o Loans can be priced immediately with current product
rates and requirements, credit can be ordered and
conditional approval given using automated
underwriting engines.
o Members can create an application via a portal at
their convenience and have it immediately available
to the credit union for processing.

23. Benefits of the Cloud in Processing
o Loan processors can immediately start managing the
application.
o Documents that are needed to process from payroll
statements to tax returns to bank statements can be
uploaded to the cloud by the borrower or originator
to expedite the work-flow.
o Electronic access to information makes for a
“greener” experience helping our environment and
providing cost-savings.

24. Benefits of the Cloud in Underwriting
o Underwriters have instant access to conversation logs
to better understand the member’s needs without
time consuming phone calls or emails.
o By using automated underwriting tools like Fannie
Mae DU and Freddie Mac LP, underwriters can review
preliminary findings and investor requirements.
o Conditions to close can be posted to cloud and
accessed immediately by originators, processors and
members through a portal.

25. Benefits of the Cloud in Closing
o Closers can verify that all conditions have been
satisfied and can communicate final requirements to
all stakeholders through the cloud.
o Closing documents can be generated automatically
and electronically delivered to closing attorneys or
title agents for expedited loan settlement.
o Funds can be automatically disbursed via closing
agents to sellers, borrowers and service providers.

26. Benefits of the Cloud in Post-Closing
o Post-Closers will receive notification of successful
closing and can review electronic closing documents
for completeness and begin managing the receipt of
final documents.
o Loans can be immediately booked to the credit union
or prepared for shipping to an investor.
o Disbursement of funds can be easily reviewed and
applied to appropriate general ledger accounts upon
disbursement.

27. Benefits of the Cloud in Secondary
Marketing
o Loan products with current pricing can be easily
entered and be immediately accessed by
originators, processors, underwriters and closers.
o Loans can be registered or locked through the cloud
so management is notified instantly of a members
intentions.
o Loans can be delivered electronically to post-
closers, servicers and investors.
o Regulatory and Investor Compliance can be ensured
because no software is updated locally; all users are
accessing the same version of the application.

28. What To See Lending Cloud Technology
in Action?
o MortgageDashboard provides
centralized, seamless, browser-based loan
orchestration managed in a secure cloud environment.
An On-Demand Solution for Loan Origination
Management — Anywhere, Anytime.
o Let me show you how cloud based mortgage software
works, provides an improved experience for members
and achieves a positive ROI for the credit union.

29. Questions and Answers

30. Thank You!
Jorge Sauri
Chief Technology Officer
Mortgage Dashboard
jorges@mortgagedashboard.com
512.637.9751