It was our pleasure to have Mortgage Banking Association President & CEO David Stevens at our annual conference at Boyne mountain this year. Please join the Mortgage Action Alliance to find out the latest news and help guide the historical changes coming out of Washington right now! Click this link to stay informed with the mortgage action alliance http://www.mbaa.org/Advocacy/MortgageActionAlliance/MAASignup.htm Read the The FHA Solvency Act of 2013 http://www.banking.senate.gov/public/index.cfm?FuseAction=Files.View&FileStore_id=76ccb8b5-2cf3-4a3f-b40b-47f0b90aa957 Read the Corker-Warner Jumpstart GSE Reform Act. http://www.govtrack.us/congress/bills/113/hr2348/text

1. 1
August 13, 2013
David H. Stevens
President & CEO
Mortgage Bankers
Association

2. 2
Rates

3. 3
Outlook for 2013 and 2014
2012 2013 2014
GDP Growth 1.7% 1.8% 2.5%
Inflation 1.9% 2.2% 1.9%
Unemployment 8.1% 7.5% 7.0%
Fed Funds 0.1% 0.1% 0.2%
10-year Treasury 1.8% 2.3% 3.0%
30-year Mortgage 3.7% 4.1% 5.0%
Refi originations ($ B) 1,247 983 388
Purchase originations ($B) 503 589 703
New Home sales (thousand) 364 457 492
Existing home Sales (thousand) 4,634 5,043 5,389
Source: MBA July 2013 Forecast

4. 4
Estimated Originations 1990 to 2014: SF Market
Source: MBA – July 2013 Mortgage Finance Forecast

5. 5
Recovery in Household Growth Has Only Just Begun
5
Foreign
Born

6. 6
Minorities Will Drive Household Growth
Sources: JCHS 2010 Household Growth Projections and US Census Bureau, 2011 ACS
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
ACS 2011
Hispanic
Asian/ Other
Black, Non Hispanic
White, Non Hispanic
0%
20%
40%
60%
80%
100%
JCHSLow Projection
Household Growth, 2010-20Households

7. 7
Wahington View: Role Oversized & Outdated
1ST Loss Position

8. 8
Piling On
Real Estate Finance
System
Compliance
Rule
Making
Coker-Warner
Hensarling
FHA
Solvency
The
Federal
Reserve
QE3
Basel IIIGSE Reform

9. 9
HMDA Data for 2011 Shows Net Exit From the Business
6,500
7,000
7,500
8,000
8,500
9,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Number of Institutions Reporting
HMDA Data
Source: FFIEC

10. 10
Credit Expanding On High End – Shrinking On Low
Source: MBA MPMA
Jan-Jun 2013 versus 2012 Purchase Tranche Analysis
2013 shares 2012 Shares YTD Change YoY 2013_2012
<=150K 35.9% 40.6% -1.7%
>150K and<=300 37.0% 36.7% 12.1%
>300K and<=417k 14.7% 13.2% 24.0%
>417K and<=625k 6.7% 5.3% 40.2%
>625K and <=729k 1.9% 1.4% 51.8%
>729K 3.9% 2.8% 57.0%
100.0% 100.0% 11.4%

11. 11
Retail Apps per Underwriter per Month

12. 12
Broad Access to Credit
“The pendulum has swung too far the other way.”
~Federal Reserve Chairman Bernanke, November 2012
“The average FICO score for denied applications in
2012 was 733 and the average LTV for denied
applications was 81%.”
~Ellie Mae, January 2013
“Credit is achingly tight.”
~CFPB Director Richard Cordray, January 2013
Upon release of the Ability to Pay Rule
“Too many families with solid credit who want to buy
a home are being rejected.”
~President Obama
State of the Union Address, January 2013

13. 13
Seat at the Table

14. 14
1. Privatize and Recapitalize
•Shareholder Path
2. Receivership and Liquidation
•Hensarling
3. Shut Down and Replace
•Corker Warner
•BPC
•President
•MBA
Options Being Discussed

15. 15

16. 16
MBA’s Key Steps to GSE Reform

17. 17
Why Now – Control Our Destiny
• Legislation Will Overtake Us
• G-Fee Tinkering
• Congress
• FHFA
• Transparency
• Competition
• Appeals To ALL Outcomes
• Proactive – Not Head In The Sand
• No Legislation Required
• Fills In The White Board

18. 18
Lead – Follow – Get Out Of The Way
Let’s Choose To Lead

19. 19
Control Our Destiny

20. 20
Control Our Destiny