The document summarizes a proposed solution called Lifeline to address the systemic breakdown of the US housing market caused by 7-10 million homes in distress. Lifeline would acquire distressed single family homes through a short sale process and convert them to rental properties for existing occupants. This would help homeowners avoid foreclosure, preserve community stability, and generate rental income and appreciation for investors, while achieving a socially responsible outcome. The solution is presented as scalable and able to address 1-2 million qualifying homes initially in the Chicago area.

1. LIFELINE EXECUTIVE SUMMARY
LIFELINE
ONE SOLUTION FOR SINGLE FAMILY DISTRESS
Tom Neary, CEO
April 21, 2012
2012 NCRC ANNUAL CONFERENCE
WASHINGTON, DC

2. LIFELINE EXECUTIVE SUMMARY
PROBLEM / OPPORTUNITY
SYSTEMIC BREAKDOWN OF U.S. HOUSING MARKET
• 7-10 million homes in distress
• Hundreds of billions of dollars in non-performing loans
NEGATIVE EQUITY HOMEOWNERS
• Unable to sell and move downmarket
• Facing inadequate supply of rental property
TROUBLED BANKS
• Time, effort, and expense in loss mitigation
• Need to sell assets
GOVERNMENT INTERVENTION
• Public commitment and political will to dispose of assets
OPPORTUNITY TO
• Achieve a socially responsible outcome driven by private capital
• Acquire distressed, single family homes at scale
• Generate rental income + capital appreciation
• Achieve positive community impact while minimizing the financial impact to all
parties involved – do good, do well
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3. LIFELINE EXECUTIVE SUMMARY
SOLUTION
SCALABLE PLATFORM TO ACQUIRE DISTRESSED HOMES IN
PRE-FORECLOSURE AND RENT THEM BACK TO EXISTING OCCUPANTS
FORECLOSURE AVOIDANCE SOLUTION FOR DISTRESSED OWNERS
• Reduces losses for borrower and lender • Potential rebuilding of finances
• Minimizes negative impact on community • No eviction / relocation, or social / family upheaval
• Reduces the number of unnecessary foreclosures
CONSERVATIVE STRATEGY
SOLUTION FOR LENDERS • Generates rental income
• Focused on banks, government agencies, • Future capital appreciation
fulfillment agents and its potential status as
SOCIALLY RESPONSIBLE
a minority-owned business (MBE)
• Aligns interests of homeowners, lenders, investors and
PROACTIVE PROPERTY MANAGEMENT
taxpayers
• Delivers world-class rental experience • Private capital working to avoid family distress
• Property management is in-house, a critical part of the • A situation where social responsibility enhances
solution financial results and lowers risk
• Preserves property value • Benefits the community
• Maximizes rental profitability
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4. LIFELINE EXECUTIVE SUMMARY
SOLUTION PROCESS
PROPRIETARY
OPERATING STRATEGY TARGET POOLS RELATIONSHIPS
ACQUIRE HOMES WITH
• Distressed single-family homes • Starter homes, clean title, • Banks
• Unique short-sale process no liens • Government agencies
• Formula-based pricing • Occupant willing and able to • Servicers
• Conversion to rental for become Lifeline tenant • Fulfillment agents
existing occupant
MARKETS
FROM • Major markets
• Bulk pools at government • Infill neighborhoods
agencies, banks • Positive price dynamics
GENERATE INITIAL GEOGRAPHIC FOCUS
• Current rental income • Areas outlying Chicago
• Capital appreciation
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5. LIFELINE EXECUTIVE SUMMARY
ACQUISITION
ECONOMICS LIFELINE BANK
ACQUISITION FORECLOSURE
100% 60–70%
OF CURRENT optimistic foreclosure
APPRAISAL selling price
DISCOUNT CAPITAL GAIN
TO INVESTORS
4% vicinity spillover
LIFELINE
OFFER 6% broker fees
LIFELINE
APPROX.
OFFER
70-80%
APPROX.
20% foreclosure
administrative costs
65–80%
OF FORECLOSURE
COMMENCEMENT
(on $250K home)
OF APPRAISAL
APPRAISAL
BASIS FOR SETTING NET
THE RENTAL RATE
30–40%
NET
30-40%
OF APPRAISAL
OF FORECLOSURE
COMPARATIVE
NET YIELDS COMMENCEMENT
TO LENDER APPRAISAL
Data summarized from FRB Boston & MIT-Harvard studies
LENDERS HOMEOWNERS INVESTORS TAXPAYERS
Avoid foreclosure Avoid foreclosure Receive rental income Avoid subsidizing
Avoid negative brand image Avoid eviction Benefit from recovering foreclosure avoidance
Clean up balance sheets Recover and possibly regain property values Avoid local tax base erosion
home ownership
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6. LIFELINE EXECUTIVE SUMMARY
ADDRESSABLE
MARKET
• 7–10 million distressed sales over
time, nationwide
• 1–2 million qualify for Lifeline’s
short-sale program
• Lifeline has a scalable operating
platform readily deployed on a
national basis
• Initial deployment: infill
neighborhoods outside the city of
Chicago
Source: RealtyTrac January, 2012
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7. LIFELINE EXECUTIVE SUMMARY
LIFELINE INVESTMENT
LIFECYCLE
LIFELINE LIFELINE LIFELINE
INVESTMENT PROPERTY INVESTMENT
MANAGEMENT MANAGEMENT MANAGEMENT
QUALIFY QUALIFY QUALIFY
CLOSE MANAGE DISPOSE
LENDER HOME OCCUPANT
FULFILLMENT AGENT
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8. LIFELINE EXECUTIVE SUMMARY
DISCLAIMER
This document is strictly for discussion purposes and is not a solicitation for investment in Lifeline, nor shall it be construed as
such by any party. The information contained in this document is provided on a confidential basis to selected entities. It must not
be copied or disclosed to anyone except to personnel and professional advisors of the recipient on a need-to-know basis. The
information contained in this document does not purport to be complete or current or to cover all the information or risk factors
that a recipient may need in order to make an investment. Each recipient should conduct its own independent investigation and
assessment, and make such additional inquiries as it deems necessary or appropriate rather than relying on the information in this
document. All information contained in this document is subject to and qualified in its entirety to the offering document and
subscription documentation relative to the investments discussed therein. Statements contained in this document that are not
historical facts are based on current expectations, estimates, projections, opinions and beliefs. Such data may not include unknown
risks, and makes forward looking statements. Actual results may differ from those contemplated in such forward-looking
statements. Targeted returns are not necessarily indicative of future performance.
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9. LIFELINE EXECUTIVE SUMMARY