loanDepot, Inc.

Good afternoon and welcome to Loan Depot's third quarter 2024 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one. I would now like to turn today's call over to Gerhard Erdely, Senior Vice President, Investor Relations. Please go ahead.

Thank you. Good afternoon, everyone, and thank you for joining our third quarter 2024 earnings call. Before we begin, I would like to remind everyone that this conference call may include forward-looking statements regarding the company's operating and financial performance in future periods. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including but not limited to guidance to our pull-through-weighted rate lock volume, origination volume, pull-through-weighted gain on sale margin, and expense trends. These statements are based on the company's current expectations and available information. Actual results for future periods may differ materially from these forward-looking statements due to risks or other factors that are described in the risk factors section of our filings with the SEC. Our presentation today contains certain non-GAAP financial measures that we believe provide additional insight into analyzing and benchmarking the performance and value of our business and facilitating company-to-company operating performance comparisons. For more details on these non-GAAP financial measures, including reconciliation to the most directly comparable GAAP measures, please refer to today's earnings release, which is available on our website at investors.loandepot.com. A webcast and a transcript of this call will be posted on our website after the conclusion of this call. On today's call, we have Loan Depot President and Chief Executive Officer Frank Martell and Chief Financial Officer Dave Hayes to provide an overview of our quarter, as well as our financial and operational results, outlook, and to answer your questions. We are also joined by Chief Investment Officer Jeff DeGurian and LDI Mortgage President Jeff Walsh to help address any questions you might have after our prepared remarks. With that, I'll turn things over to Frank to get us started. Frank?

Thank you, Gerhardt. I appreciate everyone taking the time to join us on the call today. Loan Depot returned to profitability in the third quarter through the successful implementation of our Vision 2025 strategic program. Our results were driven by high origination volumes, margin expansion, and the benefit of our process improvement and cost productivity programs. As our shareholders know well, we announced Vision 2025 in July of 2022 in response to one of the most abrupt and significant contractions in housing and mortgage volumes in a generation. Over the past three years, Vision 2025 has been our battle plan to both deal with the realities of a significantly smaller market and position the company for long-term success. Achieving Vision 2025 was truly a team effort as we navigated turbulent market conditions over the past three years. Before I talk about our new strategic plan, it's worth noting some of the key accomplishments of our Vision 2025 plan, which had four strategic pillars. Pillar one focused on transforming the company's origination business and driving purchase transactions with an expanded emphasis on purpose-driven lending and first-time homebuyers. Over the past three years, we've added new products to address affordability issues, grew our VA lending operation, expanded our business footprint with homebuilders, and enhanced our mellow home offerings. Pillar 2 centered on investing in profitable growth-generating initiatives and launching innovative new solutions that form the foundation of a lifecycle relationship with first-time homebuyers and owners. In this area, we launched a portfolio of home equity products, including a home equity line of credit and a standalone second mortgage loan. We also introduced our next generation Mellow Now digital underwriting engine and brought our servicing business in-house. Pillar 3 centered on reducing complexity and simplifying our organizational structure with an emphasis on client engagement, quality, automation, and operating leverage. Over the past couple years, we have revamped our compensation programs to drive revenues and best-in-class quality while supporting the recruitment, training, and retention of the best available talent. We also reduced the number of organizational and management layers and eliminated unnecessarily silos in many parts of our organization. And finally, pillar number four focused on aligning Lone Depot's cost structure with market realities while simultaneously investing in our long-term goal of becoming the lowest cost, highest quality producer. From the second quarter of 2022 to the end of the third quarter of 2024, we reduced annualized non-volume expenses by over $730 million while achieving top quartile loan quality production. Achieving the objectives outlined in Vision 2025 has been instrumental in successfully navigating this historic downturn in the mortgage market. We successfully reset the organization for the realities of the current market, but it's important to understand that Vision 2025 was far more than just a cost-cutting exercise. We created new operational capabilities and made significant and strategic investments in our people, our products and our technology platforms that are intended to position the company for differentiated market leadership as the housing market recovers. As we look forward to a healthier and more normalized housing market, it is now time for the company to look forward to a new horizon and focus on capitalizing on our many opportunities to offer differentiated value proposition to our stakeholders. To this end, I'm pleased to announce the launch of Project North Star, our new strategic blueprint for the next three years. Project North Star builds on the foundational imperatives of Vision 2025, including our focus on durable revenue growth, positive operating leverage, best-in-class productivity, and investments in platforms and solutions that support and ultimately transform our customers' home ownership journey. The five strategic pillars of Project North Star are as follows. Pillar number one, to become the leading partner, the lending partner of choice for homeowners with an emphasis on first-time homebuyers, supporting those clients to the lifecycle of their homeownership journey. To do this, we plan to develop and launch a unique AI-powered relationship management and engagement platform that allows our customers to optimize their home buying, selling, equity optimization, and home management experiences. Pillar two focuses on growing our purchase mortgage reach and capabilities through an expanded geographic footprint and partnerships with key industry participants, including realtors and builders. Pillar three focuses on continuing to invest in and scale our servicing portfolio and maintain best-in-class recapture rates. Pillar four focuses on building out our low-touch, automated, data-driven mortgage loan processing workflow to drive operating leverage, quality, and to substantially drive turn times down. In this turn, we will support a superior customer experience and ultimately higher revenue as we deliver a consistent, durable margins and profitability. And finally, pillar five is about becoming the mortgage industry's employer of choice, successfully recruiting, developing, and retaining the best talent available. We will continue to simplify our organization, reduce management layers, and eliminate unnecessary silos to increase innovation and ownership throughout the enterprise. We embark on Project North Star confident in the talent and resilience of the 4,500 plus members of Team Loan Depot. We believe our team, coupled with our unique multi-channel platform, provides the key ingredients needed to become the go-to lending partner for increasingly diverse communities of homeowners, including first-time homebuyers, and support those clients throughout the lifecycle of their homeownership journey. I will wrap up my prepared remarks today with a few observations on the current outlook of housing and mortgage markets. Over the past couple years, the housing market has experienced challenges that have resulted in the lowest volume of existing and overall home sales since 1995. The factors that contributed to the lower home sales, including the persistent lack of housing stock fueled by chronic underbuilding, The hangover for ultra-low mortgage rates in 2020 and 2021 and an affordability crisis impacting many first-time homebuyers can only be addressed through a concerted public-private cooperation. Despite these challenges looking forward, the Mortgage Bankers Association recently forecast 2025 mortgage market volumes at $2.3 trillion. which is up from a forecast of $1.8 trillion for 2024. The MBA forecast for 2025 assumes a progressive moderation of mortgage rates as well as more homes for sale. Based on this and other internal market intelligence, we believe there's an increasing possibility for an upward trend in housing transactions and mortgage market activities led initially by growing household formation trends and supported by demand for home equity-linked mortgage products for home improvement, debt consolidation, or personal liquidity management. With the successful completion of Vision 2025 and an exciting new plan ahead in terms of Project North Star, we believe Loan Depot is well positioned to capitalize on improving market conditions in 2025 and beyond. In closing, I'd like to thank every member of Team Loan Depot as well as our other key stakeholders for their ongoing support. Working together toward a common purpose, you have demonstrated your tenacity, commitment, and resilience in the face of significant adversity, all the while delivering important positive changes and forward momentum for the company. With that, I'll now turn the call over to Dave, who will take us through the financial results in more detail.