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Outreach Financial Services, LLC Improving Results in Distressed Mortgage Servicing Company Overview

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Page 1: Outreach Financial Services

New Foreclosure Wave is Coming Published: Thursday, 15 Dec 2011 | 9:54 AM ET By: CNBC Real Estate Reporter

Outreach Financial Services, LLC Improving Results in Distressed

Mortgage Servicing

Company Overview

Page 2: Outreach Financial Services

Jacksonville, FL based distressed mortgage component servicer licensed through operational alliance with proven large client services provider

Provides integration into mortgage loss mitigation process, focusing on

improved borrower contacts, more mod qualifications, lower re-defaults

We drive leading quality right party contacts, modifications and sustain rates by innovative and proven methods and an unmatched proposition of help to borrowers

Have exclusive alliance with the nationally known credit counseling

network which provides in-person holistic counseling , and works to stabilize borrower debt, free up cash and restore communications

(866) 972-3937 [email protected]

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Page 3: Outreach Financial Services

OFS goal was to fill industry void and attempt to quantify value of foreclosure prevention counseling

Selected STRATMOR Group, a leading mortgage industry consultancy, and Matt Lind, MIT and Harvard with Ph.D. in applied mathematics

Primary data points of comparison were : 1) incremental modifications 2) post-modification redefault rates from counseling

Used data from 2010 NFMC study by the Urban Institute on 180K NFMC counseled and 155K non-counseled distressed mortgages

Press Release and White Paper available via link and may be downloaded at www.OutreachFS.com/Investor

(866) 972-3937 [email protected]

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Page 4: Outreach Financial Services

(866) 972-3937 [email protected]

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Reduction in Monthly PITI Payments ($)

Mod rates: 4%

Re-defaults: 57%

Results: BTC* of 4:1

BTC of 7:1 with avg $550 lower mortgage + $300 debt + other borrower spending cuts

Each $300 in lower monthly exp.: cures by 46%

A modest in incremental mods pushes BTC to 10:1 plus

Applied to a portfolio of 1,000 borrowers, all receiving holistic financial counseling, BTC of 7:1=$7.15 million of losses avoided, BTC of 10:1=$10 million of losses avoided

*BTC=Benefit to cost. **Assumes average loss of $70,000 and average cost of $1,000 per file, applicable to an average grouping of

distressed mortgages.

Page 5: Outreach Financial Services

(866) 972-3937 [email protected]

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Investor Servicer Consumer

Loss avoidance-to-cost benefit (BTC) +/- 7:1 to 10:1

Favorable overall economics

Much needed stability, reduced expenses, improved cash flows

Reduced balance sheet/operating losses and costs

Reduced balance sheet, operating costs and losses.

Single point of contact

Reduced litigation exposure Reduced litigation exposure Greater financial stability

Immediate results (30-60 days) Increased revenues Better service

Improved servicer health, improved distressed mortgage values

Reduction in potential compensatory challenges

Increased chances of home retention

Better pool and sale values, more borrower insight

Improved public relations More positive outcomes on exit

Select or programmatic insertion into servicing process

Increased counseling capacity, faster results

Significant value to cost benefit

Page 6: Outreach Financial Services

(866) 972-3937 [email protected]

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Holistic Accountability: DMP* reduces monthly expenditures, increases cash for mortgage payment, gets borrower on budget and accountable, borrower has to contribute

Servicing Integration: OFS will produce even better foreclosure prevention rates as we leverage the counseling effort into the loss mitigation process

Greater Regulatory Freedom: Non-profit counselors work entire debt stack and generate higher modification rates with higher sustainability

Proven Model: Through our affiliate counseling alliance and their member agencies have been providing counseling to distressed borrowers and yielding significant results for lenders for decades

Sustainability: Core assumption of improved borrower cash flow, stabilization of all debt in addition to borrower commitment and path support high BTC results

*DMP=Debt management plan, which includes auto, credit cards, other consumer debt in addition to the mortgage

Page 7: Outreach Financial Services

Outreach Financial Services, LLC Improving Results in Distressed

Mortgage Servicing

Thank You