2007_Subprime_Shorting-Home-Equity-Mezzanine-Tranches-1
2007_Subprime_Shorting-Home-Equity-Mezzanine-Tranches-1
2007_Subprime_Shorting-Home-Equity-Mezzanine-Tranches-1
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Footnote Exhibits - Page 0985<br />
Strictly private & confidential<br />
The channel of mortgage lending<br />
l<br />
There are three major channels of lending mortgages<br />
- Retail - Loans are originated in branches of the lender. The lender controls most aspects<br />
of underwriting, including credit checking, income verification, appraiser selection,<br />
appraisal quality control, etc. The originator is more likely to have local market knowledge<br />
- Whole-sale - Loans are originated by brokers who have regular business relationships<br />
with the lender. The lender may have an approval process in accepting a broker to its<br />
network and may monitor the performance of a broker's origination. The lender controls<br />
some aspects of the underwriting process but relies.on the broker to do others.<br />
- Correspondence - Loans are originated by non-affiliated brokers according to the lenders<br />
underwriting matrix. The lender is likely to re-underwrite the loan in most aspects.<br />
Deutsche Bank<br />
All numbers shown in this presentation are indicative and are based on a sample portfolio. Actual numbers will be<br />
different and will depend on the actual portfolios selected.<br />
61
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