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58 LENDER/SERVICER PROFILE Nationstar Mortgage, LLC MEGA-SERVICER Sources: Nationstarholdings.com (1/24/2014), Fitch Ratings (12/23/2013), Moody's Investor's Service (2/4/2013), Standard & Poor's (1/21/2014) Take a look inside the numbers S T A T E S S E R V I C E D * SWOT STATEMENT (Strength, Weakness, Opportunity, Threat): According to Standard & Poor's most recent servicer evaluation, Nationstar's strengths include its strong employee base, thanks to "retain[ing] the expe- rienced, knowledgeable management and staff of Aurora Loan Services LLC's master servicing group" and the com- pany's continual adjustment of "servicer oversight to manage servicer issues, such as increased modifications and other loss-mitigation alternatives, using data to monitor defaults and loss mitiga- tion." Among the company's weak- nesses the ratings agency reports that "the company has not had an internal audit since it acquired Aurora's master servicing operation," in addition to noting portfolio runoff. KEY TECHNOLOGY Loan servicing system: ALAN KING Master Servicing System SBO 2000 RECOGNITION » Standard & Poor's recognizes Nationstar Mortgage as the No. 1 servicer by UPB, followed by Wells Fargo, Ocwen, Bank of America, and IndyMac. According to the ratings agency, these five companies administer approximately 74 percent of all loans, with Nationstar covering 38 percent of the portfolio. COMPANY VITALS Headquarters: Lewisville, Texas Phone: 469.549.2000 Online: Nationstarholdings.com Nationstar Mortgage (NYSE:NSM) is a residential loan master servicer headquartered in Lewisville, Texas. One of the largest U.S. servicers with a residential mortgage servicing portfolio of more than $375 billion in UPB, Nationstar was founded in 1977 as Centex Home Equity, the subprime arm of Centex Corp. According to Standard & Poor's, after the company was purchased by two funds managed by FIG (Funds III and IV) in 2006, it stopped originating subprime loans but retains credit risk from $500 million of legacy subprime loans. The company is now focused on originating conforming loans and increasing its third-party servicing portfolio. In 2012, the company acquired the assets of Aurora Loan Services, LLC. COMPANY'S LATEST January 15, 2014 JPMorgan with Wells Fargo Lose Share to Small Rivals: Mortgages The two largest U.S. home lenders are feeling the bite of competition from smaller firms as mortgage originations tumble at the fastest rate since 2011. Fourth-quarter figures suggest the two banks lost about 4 percent in market share, according to Kevin Barker, an analyst with Compass Point Research & Trading LLC. Meanwhile, PennyMac Mortgage Investment Trust (PMT), Ocwen Financial Corp. (OCN), and Nationstar Mortgage Holdings Inc. (NSM) have increased business over the past year and could continue to gain share, he said. - Bloomberg November 7, 2013 Nationstar Leads Mortgage-Firm Plunge as Earnings Hit Shares Nationstar Mortgage Holdings Inc. (NSM) led a slump in companies involved in making, servicing, backing, or investing in U.S. mortgages after the firms posted quarterly results and executives discussed their outlooks. Nationstar fell 17 percent to close at $40.75 in New York, the most since March 2012, after reporting earnings today that missed analysts' estimates. The Lewisville, Texas-based company created by Fortress Investment Group LLC said it will sell part of its origination unit. - Bloomberg SERVICER RATINGS Fitch Ratings: RMBS Primary Servicer, Alt A Rating RPS2- RMBS Master Servicer Rating >> RMS2+ RMBS Special Servicer Rating >> RSS2-; RMBS Primary Servicer, Subprime Rating RPS2 >> Moody's Investor's Service: Long-term rating >> B2 >> Outlook >> Stable Standard & Poor's: Residential Master Loan Servicer >> ABOVE AVERAGE; Management and Organization >> ABOVE AVERAGE; Loan Administration >> ABOVE AVERAGE; Outlook >> Stable; Financial Condition >> Sufficient KEY PERSONNEL Jay Bray CEO and Director Harold Lewis President and COO David Hisey CFO Staffing » Servicing staff: 73 » Staff experience (averages): » Senior managers: 23 years' industry experience, 11 years' tenure » Middle mangers: 12 years' industry experience, 8 years' tenure » Total annualized turnover: 4.5% percent for managers and 2% percent for staff » Servicing sites: Primary servicing location in Denver *As of June 30, 2013 SERVICING SUMMARY Revenues » Servicing fee income: $341M » Other fee income: $84M » Gain on mortgage loans held for sale: $205M » Total revenues: $631M *As of Q3, 2013 Unpaid Principal Balance (UPB) » Q3 2013: $375 billion » Q3 2012: $198 billion » Annual change: +90% Delinquency Stats » Q3 60 day+ delinquency rate: 12.1% of UPB » Annual change: 300 basis points KNOW THIS According to data released by Nationstar in the three months ending September 30, 2013, the company listed its mortgage servicing liabilities at $82,521. Headquarters in Texas, Primary Servicing Location in Denver, Colorado