The journey to a mortgage is complex and expensive, so of course the transaction will require more than a few swipes on a smartphone. Underwriting a sizeable loan can take weeks with the task of collecting income and asset documents to analyze and verify. In fact, one source from the Mortgage Bankers Association says the average mortgage application has ballooned to 500 pages. With advancements in digital verification, lenders can dramatically accelerate the process, providing benefits to both their own operations and the consumer mortgage experience.

2. 2 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Speakers
Natalie Hunt
Director of Digital Alliance Partnership
Fannie Mae
Natalie Hunt joined Fannie Mae in October
2004. She currently holds the position of
Director of Digital Alliance Partnership in
the Single-Family Division at Fannie Mae,
where she is responsible for the third-party
software provider relationships and
associated technology integration and
customer/partner implementation activities
to help drive digital transformation within
the mortgage industry. Natalie is an
experienced product and partner
management professional with experience
in driving large-scale digital transformation
projects from inception to implementation.
Mike Pecen
Head of Product, Transaction Services
Experian
Mike Pecen joined Experian in May of
2016. He is responsible for
Transactional Services’ strategy and
product, focusing on how consumer
permissioned data and supporting
technologies will be leveraged to
improve underwriting and screening
processes. Mike’s career began in
retail financial with two of the Top 5
financial institutions in the United
States, has deep experience in the
direct-to-consumer financial
technology (Fintech) space, and has
launched two startups of his own.

3. 3 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
How we see the market
1. Fannie Mae DU validation service & ecosystem
2. Lender Reports Portal
3. Advantages of value-added APIs
4. Get more out of your data
Agenda
4 best practices in digitizing mortgage verification
Questions & Answers

4. 4 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
How we see
the market

5. 5 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Number of consumers
who view their banking
relationship as transactional1
Consumers choose others for
high margin solutions:
• 61% - Brokerage
• 70% - Auto
• 52% - Mortgage
Number of Millennials who
would make a banking choice
based on digital services2
Number of consumer who are
willing to securely share their
login credentials to
automatically pull their data3
Average cost per day to close4
Average days saved with
Day 1 Certainty validations5
• 8.1 - Income
• 11.9 - Employment
• 6.1 - Asset
Market Insights
79% 92% 60% $126
1 - Accenture: 2015 North America Consumer Digital Banking Survey
2 - CCG Catalyst: 2016 Millennials and the Future of Banking
3 - Accenture, Mortgage Cadence: Borrower-Defined Digital Mortgage Expectations
4 - Accenture, Mortgage Cadence (Mortgage Bankers Association): Borrower-Defined Digital Mortgage Expectations
5 - Fannie Mae advertisement

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Industry Challenge
+ Account
Aggregation
Desired Outcome
Verifying assets often takes time
Increase
Efficiency
Paper forms increases risk of false
documentation and inflated reporting Minimize Risk
Consumers expect quick and easy
access to credit
Personalized
Experiences
To remain competitive, shift toward
increased automation and digitization
Unlock
Intelligence
Innovate through consumer-permission data

7. 7 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Mortgage Lending
VISION
10 minute application – 10 day close
OUTCOME
• More borrowers through the process
• Increased speed to close
• Cost efficiency and maximize financial resources

8. 8 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Utilize the Desktop Underwriter
platform and Day 1 Certainty1

9. 9 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
The Desktop Underwriter® (DU ®) validation service uses external vendor data partners
to independently validate borrower income, assets, and employment data, providing lenders
with Day 1 Certainty™ on validated loan components.
How the DU validation service works
• Lender orders a verification report from a designated partner with
consent from the borrower, enters loan information into
DU and submits the loan casefile.
• DU obtains a report copy from the partner using the reference number.
• DU validation service performs income and asset calculations
and returns specific messages related to loan components.
• Lender closes the loan and delivers to Fannie Mae.
• Lender receives Day 1 Certainty for validated components
(If lender meets all DU validation service requirements described in
the Selling Guide and complies with applicable DU messages).
Overview
DU Validation Service | March 2018
Lender
LOS
1Lender orders
report from
vendor(s)
DU and DU
Validation
service
5DU validation
service report
vendor
Lender submits
casefile to DU
with Reference
# or Loan #
1
3Vendor returns
report to lender
with Reference #
or Loan #
2
DU pulls in copy of
report from vendor
with Reference #
or Loan #
4
DU validation service:
• Runs calculations
• Compares data to DU
• Returns messages
with DU findings

10. 10 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Key Components
DU Validation Service | March 2018
The DU validation service is an open platform to provide customers with choices.
The platform currently offers:
Three service offerings 19 partners in production Single Source Validation (in pilot)
• Income validation
• Asset validation
• Employment validation
• 16 tax transcript report suppliers
• Three asset verification report
suppliers
• Two manual VOI/VOE report
suppliers and The Work Number
(Equifax)
Alternative method to validate assets,
income and employment by
leveraging 12 months of asset data

11. 11 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Single Source Validation leverages bank account
data via a single asset report to validate assets,
income, and employment. It is currently in pilot
with a broader rollout planned for 2018 to allow
for feedback and collaboration with lenders and
industry partners.
Single Source Validation
DU Validation Service | March 2018
Key Benefits
Combining 3 Steps into 1
 Validates assets, income and employment
using bank account data from one asset report
Reducing Time and Cost
 Leverages source data, instead of chasing
paper documents, lenders gain efficiency at
underwriting, processing and QC
Improving Borrower Experience
 Reduces the number of documents the
borrower provides resulting in less back and
forth with their lender
Building on Certainty
 Freedom from reps & warrants on validated
loan components

12. 12 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
14%
Average reduction
in application to close time
for loans with employment
and/or income validated
17% >1,000
Lenders have signed up for
the DU validation service,
accounting for ¾ of deliveries
through DU
Average reduction in the time
from application to close
when assets are validated
through DU
DU Validation Service Value to Date
DU Validation Service | March 2018
The DU validation service has significantly impacted the lending ecosystem by increasing the
efficiency of the mortgage origination process.

13. 13 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Potential PartnersPotential OfferingsMortgage Industry
Transformation
• Automation for convenience and
faster turnaround times
• Digitization to eliminate the need
for paper and reduce error
• Single Source Validation
(currently in Pilot)
• Growth in the Fintech industry due to their
specialized digital capabilities
• Increased engagement with technology
service providers
• Increased customer choices based on
industry demand
Future State of the DU Validation Service Ecosystem
DU Validation Service | March 2018
We will broaden our Partner ecosystem as platform offerings expand and underwriting processes
evolve with advanced technologies.

14. 14 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Leverage a
lender reports portal2

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Report Dashboard

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Request Report

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List of Accounts

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Account Verification

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Loading page

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Account Selection

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Account Added

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Account Confirmation

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Lender Report
Dashboard

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Are you using Account Aggregation
in your mortgage process today?
 Yes
 No
 On the roadmap

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Take advantage of
value-added APIs3

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Value added API’s
Pre-Population Account Ownership
Verification
Bank
Statements
Personalized Experience

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Getting more out of the data
you are using today4

29. 29 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Attributes & Insights
Unlock Intelligence
Attributes
• NSFs activity
• Min / max / average balances
• Residual cashflow
Scores
• Income Stability
• Cashflow Stability
Lift!

30. 30 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Our Differentiators
Quality
Finicity credit decisioning data reports are derived from integrations only with “certified” Financial Institutions.
This provides a higher level of confidence that key data elements including, account owner name, FITID and
required transaction history are available to produce a comprehensive report.
Compliance
Both Experian and Finicity are registered CRAs, while other providers are not. As per the Fair Credit
Reporting Act (FCRA), any data being used to underwrite a loan must meet FCRA requirements. Other
providers state they are compliant, but have no experience supporting adverse action, consumer disclosure
and consumer disputes.
Innovation
• Based on Finicity data, Experian DataLabs is underway developing attributes, advanced analytics and
predictive scores that will improve underwriting decisions and help clients lend deeper. Others do not
have this capability or experience.
• Our solution is integrated with Experian’s best-in-class Decisioning as a Service (DaaS) platform,
NetConnect and ATB.

31. 31 © Experian Public • 4 Best Practices in Digitizing Mortgage Verification
Verification of Asset Report / SSV
Experian Lender Reports Portal
Value Added APIs
Attributes & Insight
4 Solutions to Digitize Your Mortgage Lending
1
2
3
4

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Questions?