A Special Briefing Room with Robin Bloor and Elm Systems Live Webcast June 26, 2013 http://www.insideanalysis.com With nearly $10 trillion in US residential mortgage loans outstanding, the market for managing these loans is truly vast. The key to success is visibility—having a strategic view of these assets, from acquisition through disposition. A special episode of The Briefing Room with veteran Actuary and IT Analyst Dr. Robin Bloor will provide insight about how the residential whole loan market can benefit from new technologies. He’ll be briefed by Barbara Chell and Matt Mustich of ELM Systems, LLC, who will provide a detailed overview of the Enterprise Loan Management System (ELMS). They’ll tout the system’s capabilities as a residential whole loan database which includes functionality for tracking loan performance, profiling tape data, filtering and creating stratifications, and more. Please register today.

1. The Briefing Room
Getting a Handle on Residential Mortgage Loans

2. Twitter Tag: #briefr The Briefing Room
Welcome
Host:
Eric Kavanagh
eric.kavanagh@bloorgroup.com

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! Reveal the essential characteristics of enterprise software,
good and bad
! Provide a forum for detailed analysis of today s innovative
technologies
! Give vendors a chance to explain their product to savvy
analysts
! Allow audience members to pose serious questions... and get
answers!
Mission

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Residential Mortgage Loans
And lots more…

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Analyst: Robin Bloor
Robin Bloor is
Chief Analyst at
The Bloor Group
robin.bloor@bloorgroup.com

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ELM Systems, LLC
And lots more…
! ELM Systems LLC develops loan management
solutions
! The Enterprise Loan Management System
(ELMS) is designed for institutions and funds
that hold and manage residential whole loans
! C&A Strategic Advisors is the managing partner
of ELM Systems

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Guests
BARBARA CHELL
MATT MUSTICH
Principal
C&A Consulting, LLC
Senior Vice President
ELM Systems, LLC
Barbara is currently a Principal at C&A Consulting, LLC
responsible for their Residential Mortgage practice as well as a
Director at ELM Systems, LLC where she is responsible for Product
Management. Barbara has 25+ years of experience in commercial
and residential lending. She has held senior positions in finance,
operations, processing, servicing oversight and risk reporting.
Matthew is currently a Senior Vice President at ELM Systems, LLC
with his focus being on Business Development. Matthew has 10
years experience in the residential whole loan markets with
extensive experience in the trading, pricing and managing of
residential loan inventories for both performing and non-
performing portfolios.

8. Enterprise Loan Management
System (ELMS)
✤ Due Diligence !
✤ Loan Servicing !
✤ Performance Tracking !
✤ Strategy Management !

9. Enterprise Loan Management System
✤ ELMS was initially used by a privately-held entity to bid, manage, and securitize
residential mortgages. The system managed upwards of 10 million loans.
✤ There is a market need for an enterprise-level residential loan management system to
allow investors to track inventory performance, create strats, and extract pertinent data
into an external repository for accurate accounting.!
✤ The software is currently offered as a standalone package installed by our technology
team in conjunction with client staff.!
History !

10. Enterprise Loan Management System
The Enterprise Loan Management System (ELMS) is an advanced and flexible solution to managing residential
mortgage loan inventories from acquisition through disposition. It allows you to:
✤ Bid on loans either individually or in packages!
✤ Create loan sets for securitization or package sale!
✤ Manage Due Diligence results!
✤ Track loan performance!
✤ Track servicing information through REO!
✤ Create user-defined calculation for information tracking!
✤ Track collateral!
✤ Filter and strat!
✤ Create reporting extracts via Excel !

11. Life of a Loan
Acquisition to Disposition !
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
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12. Tape Loading
Selecting a Loan Tape !

13. Tape Loading
Preview Input !

14. Tape Loading
Mapping Columns!

15. Tape Loading
Translations!

16. Tape Loading
Loan Validation !

17. Tape Loading
Loading!

18. Loan Management
Loan Package Manager!

19. Loan Management
Package Shrinking !

20. Data Mining
Filters!

21. Data Mining
Stratifications !

25. Due Diligence
✤ Easily
customizable
due
diligence
views,
in
the
providers
desired
format
✤ Export
the
data
set
to
Excel
✤ Due
diligence
results
are
uploaded
to
ELMS
using
the
Load
Package
Wizard
✤ Specific
due
diligence
fields
are
updated
and
the
results
can
be
compared
to
the
bid
/
seDle
data

27. Servicing
Maintain Servicers !

28. Servicing
Servicing Transferring!

29. Servicing
✤ Easily
customizable
servicer
views,
in
the
servicers
desired
format
✤ Export
the
data
set
to
Excel
✤ Servicing
results
are
uploaded
to
ELMS
using
the
Load
Package
Wizard
✤ Specific
servicing
fields
are
updated
and
the
results
can
be
compared
to
the
original
data

30. Disposition
Deals and Pools for sale !

31. Permissions Controls
Role Permission manager!

32. Permissions Controls
Loan History Report !

33. Permissions Controls
Data Dictionary !

34. Thank you and for further information, contact us at:!
info@elm-systems.com!
Or visit us at www.elm-systems.com!
!

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Perceptions Questions
Analyst:
Robin Bloor

36. The Bloor Group

37. The Bloor Group
NINJA Loans
NINJA Loan: NINJA = No Income No Job or Assets
Why would any sane
person make a mortgage
loan to a NINJA?
Ø Because they could probably pay the first year’s
premiums – so the loans were structured accordingly
Ø Because the property market was booming and the
rise in house prices might just eliminate the risk
Ø Because you could pass on the risk

38. The Bloor Group
The Mortgage Backed Security
Mortgage Backed Securities:
Bundled the NINJA Loans with others en block
(risk spreading)
Were traded without adequate
transfer of title
Were falsely rated – often AAA
Were a primary cause of the 2008 crash
WE ARE STILL SORTING OUT THE MESS
and

39. The Bloor Group
A Systemic Failure
Caused in some
instances by
“bad actors”
Assisted by
inadequate
systems without
proper audit trails
Economic impacts
(which were severe)
Severe legal and
administrative
impacts

40. The Bloor Group
A Systemic Failure
Caused in some
instances by
“bad actors”
Assisted by
inadequate
systems without
proper audit trails
Economic impacts
(which were severe)
Severe legal and
administrative
impacts
FAIL

41. The Bloor Group
And So…
Ø Provide transparent loan level data
Ø Expose the actual risks in a clear and
comprehensible manner
Ø Enable the intelligent management and monitoring
of loan performance
Perhaps we should have
RELIABLE
loan management systems which:

42. The Bloor Group
1. The failure of Mortgage Backed Securities was
clearly in part due to poor systems. Given that it was
not the only cause please explain how your
application suite:
! Provides more coherent loan level due diligence
reviews
! Accurately exposes the level of risk
! Includes customer specific loan level validations
at bid and settlement
Questions

43. The Bloor Group
2. How does the application deal with taking on
existing loans (some of which may be under
water)?
3. Imagine the situation where, in the future,
house prices fall in a dramatic way (say 30% on
average):
! Could your application suite be used to
identify these loans for monitoring and
performance tracking?
Questions

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Thank You
for Your
Attention
www.insideanalysis.com