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					                                              First Edition
                                              July1, 2009

BROKERS BEST CONTRACT LOAN PROCESSING
A Loan Officer’s Guide to Completing a 1003




                    Knowledge is Power
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider
                             Table of Contents

Introduction                                                     Pg 1
Professional Biography of Wes McKibbon – Your Contract Processor Pg 3

Chapter 1                     Purpose of the Kit

Purpose of the Handbook                                            Pg 5
About the Handbook                                                 Pg 5
What you can expect As A Trained Loan Officer                      Pg 5
Getting Trained                                                    Pg 7
Getting Your Client Pre Qualified                                  Pg 8
Loan Submission                                                    Pg 8
Review The Decision                                                Pg 8
Gathering Conditions                                               Pg 8
Final Approval                                                     Pg 8
How Much Can You Make                                              Pg 9
What Your Employer Expect From You                                 Pg 10

Chapter 2                     Initial Application

Pre-qualification                                                  Pg 12
Initial Application                                                Pg 12
Required Disclosures for all loans                                 Pg 13
FHA and VA Disclosures                                             Pg 14
VA Disclosures                                                     Pg 14
RD Disclosures                                                     Pg 14
Submission to AUS “Ultimate Closings”                              Pg 15
File Review                                                        Pg 15
Actions That Must Be Perform Within 30 Days Of Application         Pg 16
RESPA Compliance                                                   Pg 16
Other Federal and State Compliance                                 Pg 16
Compliance with Regulatory Agencies                                Pg 18
        ECOA                                                       Pg 19
        The Home Mortgage Disclosure Act                           Pg 20
        Truth In Lending Reg Z                                     Pg 20
        RESPA Regulation X Appendix A to Part 3500 (GFE)           Pg 21
        The Federal Emergency Management Agency                    Pg 22
        The PMI Act                                                Pg 23
        Patriot Act                                                Pg 23
        Credit Disclosure                                          Pg 23


                                     621 Doolittle Road
                                   Woodbury, TN 37190
                          Ph: (615) 556-2103 Fax: (615) 563-6771
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

Chapter 3                     Closing Items You Need to Know About

Hazard Policy Requirements                                           Pg 26
Power of Attorney                                                    Pg 27
Living Trust                                                         Pg 28
Maximum Loan Amounts                                                 Pg 28
FNMA/FHLMC Agency Allowable Contributions                            Pg 29
FHA Maximum Seller Contributions                                     Pg 30
RD Maximum Seller Contributions                                      Pg 30

Chapter 4                     Who Is Your Client

Citizenship                                                          Pg 32
Non-Purchasing Spouse                                                Pg 32
Co Borrowers and Co-Signers                                          Pg 33

Chapter 5                  Income
`
Income Stability                                                     Pg 36
Salary-Wages                                                         Pg 36
Overtime & Bonus                                                     Pg 37
Part Time                                                            Pg 37
Commission                                                           Pg 38
Alimony/Child Support Received                                       Pg 39
Interest and Dividends                                               Pg 39
Rental Income                                                        Pg 39
Auto Allowances                                                      Pg 41
Trust Income                                                         Pg 41
Projected Income                                                     Pg 42
Employment by a Family Owned Business                                Pg 42
Self-Employed                                                        Pg 42
Recently Discharged Veterans                                         Pg 43

Chapter 6                     Assets

Written Verification of Deposit or Bank Statements                   Pg 46
Access to Fund                                                       Pg 46
Details of Transaction                                               Pg 47
Bridge Loans                                                         Pg 47
Cash Advances on Credit Cards                                        Pg 47
Cash Saved at Home                                                   Pg 47
Collateralized/Secured Loans                                         Pg 48
                                     621 Doolittle Road
                                   Woodbury, TN 37190
                          Ph: (615) 556-2103 Fax: (615) 563-6771
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

Commissions from Sales of Subject Property                         Pg 48
Corporate Funds                                                    Pg 48
Earnest Money Deposit                                              Pg 49
Employee Savings Plans (401K)                                      Pg 49
Gambling and Lottery Winnings                                      Pg 49
Gift of Equity                                                     Pg 49
Gift from a Relative                                               Pg 49
Gift from Employer, Church, Municipality or Non Profit             Pg 50
Lawsuit and Insurance Settlement                                   Pg 50
Life Insurance Cash Value                                          Pg 50
Relocation Benefits                                                Pg 50
Relocation Equity Buyout                                           Pg 50
Rent Credit                                                        Pg 51
Sales of an Asset                                                  Pg 51
Sale of Real Estate                                                Pg 51
Sweat Equity                                                       Pg 51
Tax Refunds                                                        Pg 52
Trade Equity 1031 Exchange                                         Pg 51

Chapter 7                    Credit

Bankruptcy                                                         Pg 55
Importance of the Applicants Credit Rating                         Pg 55
Credit Rating                                                      Pg 56
Understanding FICO (Fair Isaac) Scores                             Pg 56
Clearing Credit Mistakes                                           Pg 57
How to Register a Dispute                                          Pg 59
Clearing Open Collection Accounts                                  Pg 59
Re-Aging Old Pass Due Accounts                                     Pg 60
Building Credit                                                    Pg 61
Credit Inquiries                                                   Pg 61
Child Support/Alimony as a Debt                                    Pg 61
Job Related Expenses                                               Pg 61
Ratios                                                             Pg 61
Credit Reporting Agencies                                          Pg 62
Letters of Explanation                                             Pg 63
Requesting or Disputing Information                                Pg 63
Rapid Rescoring                                                    Pg 63




                                     621 Doolittle Road
                                   Woodbury, TN 37190
                          Ph: (615) 556-2103 Fax: (615) 563-6771
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider


Chapter 8                    Property And How It Might Be Titled

Condominium Guidelines                                             Pg 68
FHA Manufactured Housing Checklist                                 Pg 70
FHA Builder Loans/Proposed Construction                            Pg 71
      Single Family, Townhomes, and 2 to 4 Units                   Pg 71
      Condominiums                                                 Pg 72
      Manufactured Homes                                           Pg 72
      Under Construction or Less Than One Year Old                 Pg 72
      Single Family, Townhouse, or 2 to 4 Family                   Pg 72
      Condominium                                                  Pg 72
      Manufactured Homes                                           Pg 72
Secondary Residence                                                Pg 73
Investment Property                                                Pg 73
Revocable Trust                                                    Pg 73

Chapter 9                    FHA - The Application

The Interview                                                      Pg 76
Credit                                                             Pg 77
Seller Concessions                                                 Pg 77
Inducement to Purchase                                             Pg 77
Determining Maximum Financing                                      Pg 77
MIP Calculations                                                   Pg 78
Property Less than one-year-old                                    Pg 78
Cash Out Refinancing                                               Pg 78
Streamline Refinancing without and Appraisal                       Pg 78


Chapter 10                   VA The Application

The Interview                                                      Pg 82
Certificate of Eligibility                                         Pg 82
Determining Maximum Eligibility                                    Pg 82
Funding Fee Calculations                                           Pg 83
Who is Exempt form a Funding Fee                                   Pg 84
Disclosures                                                        Pg 84
Cash Out Refinance with an Appraisal                               Pg 85
Interest Rate Reduction Refinancing Loans with an Appraisal        Pg 85
Rate Reduction Refinancing of an ARM                               Pg 86
Seller Concession                                                  Pg 86
                                     621 Doolittle Road
                                   Woodbury, TN 37190
                          Ph: (615) 556-2103 Fax: (615) 563-6771
     Brokers Best Contract Loan Processing
         A Premiere Contract Loan Processing Service Provider

Chapter 11                RD The Application

Forms                                                             Pg 89
Features                                                          Pg 89
Web Links for Rural Development                                   Pg 90
Income Limits                                                     Pg 90
Adjustments to Income Limits                                      Pg 90
Income & Raito Calculations Worksheet                             Pg 91
Tennessee Counties with Non-Rural Areas                           Pg 92
Tennessee Property Eligibility Determination                      Pg 92
Applicant Eligibility                                             Pg 93
Adequate and Dependable Income                                    Pg 94
Repayment Ability (Ratios)                                        Pg 94
Credit History                                                    Pg 94
Previous Loan                                                     Pg 96
Other Federal Debt                                                Pg 96
Present Housing                                                   Pg 96
Citizenship                                                       Pg 96
Occupancy                                                         Pg 96
Deferred Students Loans                                           Pg 97
Underwriting Issues                                               Pg 97
Unpaid Collections                                                Pg 97
Ratio Waivers                                                     Pg 97
Payment Shock                                                     Pg 98
Risk Layering                                                     Pg 98
Middle Credit Score                                               Pg 98
Examples of Common Compensating Factors                           Pg 98
Appraisal                                                         Pg 99
Appraisal Age                                                    Pg 100
Appraisal Report                                                 Pg 100
The Appraiser Must Complete The Following Steps                  Pg 100
Condominiums and Townhomes                                       Pg 101
New Construction                                                 Pg 101
Homes with Pools                                                 Pg 102
Rates, Terms, and Fees                                           Pg 102
Terms of Repayment                                               Pg 102
Guarantee Fee                                                    Pg 103
Charges and Fees by the Lender                                   Pg 103
Escrows                                                          Pg 103
Conditions Commitment Must Be Obtained Prior to Closing          Pg 103
RD Application Checklist                                         Pg 104
Inspection Certification/Existing Properties                     Pg 105
                                   621 Doolittle Road
                                 Woodbury, TN 37190
                        Ph: (615) 556-2103 Fax: (615) 563-6771
     Brokers Best Contract Loan Processing
          A Premiere Contract Loan Processing Service Provider

Re-inspections After Completion of Repairs                        Pg 106
Thermal Certification                                             Pg 107

                              Exhibits In this Kit
Initial Dispute Letter                                            Pg 1080
Initial Dispute Letter on a Specific Account                      Pg 108
Second Dispute Letter to Request Re-Investigation                 Pg 109
Letter of Acknowledgment Requested                                Pg 109
Request for Deletions of Obsolete Information                     Pg 110
Request to Add Information to Credit Report                       Pg 110
Request Removal of Late Payment                                   Pg 111
Settlement of Account                                             Pg 112
AUS Express Pre-Qualification                                     Pg 113
Loan Officer/Processor Check Sheet                                Pg 114
Processing Evaluation                                             Pg 118
Getting Started                                                   Pg 119
FHA Spot Condo Approval Certification                             Pg 123




                                    621 Doolittle Road
                                  Woodbury, TN 37190
                         Ph: (615) 556-2103 Fax: (615) 563-6771
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

                                 Introduction

BBCLP is a Premier Mortgage Processing Service that has a long history of
offer exceptional services to its partnering Community Banks, Credit
Unions, Mortgage Brokers, and other professionals qualified to join our
team. We process Conventional, FHA, VA, and RD residential loan
applications and assist you from pre-qualifying to funding with a well-
trained staff.

Through our efforts, we want to extend a new era of loan processing, in
ways you have never had the opportunity to have before. BBCLP is
committed to being very responsive to the residential lending community,
and that is why we have created Real Estate Based Lending (REBL) to
assist you in this value added service.

Have you been searching for a mortgage processor service where you
can develop a rewarding relationship both personally and financially?
Have you had a need to training and education your new origination
staff, but didn’t have the time to devote to them in this busy market? If
you answered yes to these questions we offer it all, and work mainly to
compliments your primary goal of originations and closings.

We bring together residential lending professionals and the latest
technologies with lending opportunities in a professional relationship that
allows you utilize the resources we make available. You already know you
and your employees can profit from a well-trained staff. The problem has
been finding the support. At BBCLP, we provide that support to you!

We are your area processing service in mortgage lending and offer
exceptional support to our partners beginning with this easy to read
handbook for you to provide to your loan officers in hopes they will find it
a easy reference guide in completing a 1003. When you add BBCLP at
the top of your list of preferred service providers you get all the service you
expect quarterly updates from FHA, VA, and RD, and educational training
for your new junior loan officers.

Our business model is outlined to meet and comply with Fannie Mae,
Freddie Mac, Department of Housing and Development (HUD), Real
Estate Securities Procedures Act (RESPA), Residential Development and all
                                     1
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

state statutes.      BBCLP was created to assist residential lending
professionals in the art of completing the closing.

Incorporating BBCLP is a rewarding opportunity; you will make yourself
and your loan officers more desirable to your community. Recent studies
show more than half of new homebuyers, and clients looking to refinance
out of their existing loan have had unsatisfying experiences with the
current lenders. When finding a company with a well-trained staff,
customers not only come back for future needs, but refer their friends and
family in an overwhelming response to the experience they get.

Our handbook “A Guide To Successful Application Taking” is being
provided to you and your team to learn how BBCLP provides its services as
a contract processing service, as well as an on going measure to become
fully informed of all regulatory requirements outlined by Fannie Mae,
Freddie Mac, HUD, VA, RD, and other regulatory agencies. Regardless as
to whether or not you use our services, please enjoy the material, and join
our mailing list to get interesting topic that effect your company and your
originators careers at:

midtenn@brokersbestcontractloanprocessing.com

Purchasing or refinancing a home loan is one of the biggest financial
decisions most people will make. Therefore we have developed our
business model and this handbook to help you create the personalize
service your clients want, and most of all a reason to refer you again, and
again, and again! We hope you will take this first step to a rewarding
value added service for your clients in residential mortgage lending, just
by reading this far and considering BBCLP as your preferred service
provider.    It proves you are interested and energized about your
company and your originators careers. The mortgage lending profession
is continually changing. Updates, financing tools, regulatory requirements,
technologies, and enhancements change every day, but things aren’t
getting harder, their getting better. Knowledge is power and now we are
releasing that knowledge to you and your team. BBCLP is adapting to our
new world and ready to meet the challenge with you!




                                     2
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
 Brokers Best Contract Loan Processing
        A Premiere Contract Loan Processing Service Provider

             Professional Biography of Wes McKibbon
                      Your Contract Processor

Contract Underwriter for various MI and Due Diligence Companies

My last three long-term assignments were from May 2005 through
July 2009 with Albright Mortgage Services, LLC and United
Guaranty with two Seattle based lender/brokers providing both
contract underwriting and processing services, and one national
lender providing contract underwriting for USDA/RD loans. My
responsibilities included over site of the closing, funding, shipping,
and warehouse lending departments. The assignments were
internet processing and a per file processing assignment. Prior to
the above, I was at WAMU with Genworth Financial performing
Condominium Approval Department from May 2004 until its
relocation to the east coast in April 2005.

Operations Manager/DE Underwriter

I performed a host of supervisory and administrative duties over
the processing, closing funding, shipping, and warehouse
lending staff that managed a ten million dollar LOC that I used
to fund an average of forty million in monthly production.
Additionally I solely underwrote all FHA direct endorsement, VA
LAPP and USDA/RD files.

Contract Underwriter various MI and Due Diligence Companies

As a contract underwrite, I have performed a host of activities
requested by lenders and brokers. This service has included
implementing and performing credit underwriting, processing,
closing, funding, services, warehouse, and demonstrates
expertise in a variety of the industry’s concepts, practices, and
procedures. I provided extensive experience and judgment to
plan, and accomplish goals. Perform a variety of tasks, and have
lead and directed the work of others. I have worked with a wide
degree of creativity and latitude. Provide underwriting authority
through several MI companies, while engaged in providing
automated (LP and DO) and manual underwriting services for
                                  3
               621 Doolittle Road, Woodbury, TN 37190
                         (615) 556 2103 Direct
                          (615) 563-6771 Fax

                               2/1/2010
 Brokers Best Contract Loan Processing
        A Premiere Contract Loan Processing Service Provider

conventional. Professional services during this time ranked
primarily in underwriting, however many projects were orientated
in areas of purchase and acquisition, quality control, and
internal audit.

DE Underwriter

I provided direct endorsement underwriting for numerous
correspondent lenders in south and central Florida.
Responsibilities included working closely with each broker
accounts to assure proper submission, MIP certification,
compliance, and qualify control measures were being
maintained.

Supervisor of QC

Supervised a quality control staff or nine, and was responsible for
the budgets. I maintained all post-closing audits on legal, credit,
property appraisal, underwriting and servicing requirements
required by FNMA, FHLMC, FHA, VA, and private investors.
Secured my FHA Direct Endorsement Authority (B-421) direct
endorsement underwriting approval.

Processing Manager.

Originated and processed builder accounts. Promoted to
manager of the processing department after two years. I
assured quality interviewing and processing services statewide.
Maintained compliance requirements established by Reg. Z
assured proper documentation of closing documents on both
conventional loans and those insured by FHA and VA.

NCOIC Analysis Division USAF/Air University/Squadron Officer

Honorable Discharge



                              Chapter 1
                                   4
                 621 Doolittle Road, Woodbury, TN 37190
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                                2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                     Successful Origination Secrets to
                         “The Ultimate Closings”

Purpose of this Handbook

The Handbook was designed to help you in keeping in compliance with a
host of regulatory and investor requirements. The handbook is intended
for the beginning Loan Originator and Career Professional.

About this Handbook

If this is your first time using “REBL”, we recommend that you read the
handbook in its entirety to become familiar with tasks you will commonly
perform in completing an application and using the tools we provide you.
After you have become more familiar with compliance requirements,
refer to specific sections of the handbook as you explore, learn, and work.
We will regularly provide updates to be incorporated in your handbook,
and if not already; in time you will be a seasoned veteran while making
the commissions you deserve.

In addition to this handbook when you partner BBCLP we will set you up
with your personalize loan processing services and get you established
with all the tools you need to access BBCLP .

What You Can Expect As A Trained Loan Office

Today, mortgage lending is changing more than ever. Advanced
Internet technology, changing consumer attitudes and government
regulations have literally shifted the balance of power for the entire
industry.   The result is an ever-changing loan origination process,
economic pressures and technology recreates our industry. To keep
current with these changes and take advantage of the income
opportunities you need BBCLP’s Loan Processing Services and REBL
training to enhance your origination and stay on top of the continued
changes in a seamless process. With that in mind, BBCLP marketing
strategy was developed with three goals in mind. Simplicity, Speed, and
PROFIT.


                                     5
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

Our service and tools are easy to use and were designed around assisting
residential lending professionals to qualify their clients on the spot. Once
you have used our loan processing service, it will become second nature
to you as a simple and profitable value added service. Through BBCLP,
you can quickly earn the commissions you deserve as a residential lending
professional. More importantly, you will stay at the center of the
transaction and in control from start to finish.

Other contract processing services around the country offer similar
programs. However, no other service is providing it’s resources like BBCLP.
Successful professionals have learned through programs like REBL at great
cost to themselves on how to increase profits without increasing workload.
Now you can become part of a team that believes in supporting your
effort! As you begin, you will be adding value as a residential lending
professional to your clients for just reading the next eleven short chapters
as we re-create the concept Knowledge is Power, and with power like
this, you can better serve your clients as one of the most customer service
orientated residential lending professional, in your community.

With BBCLP and your on lines support tools, you can easily manage the
added service. You will have all the tools you need to succeed. You will
be able to pre-approve your clients anytime, day or night and get real
approvals directly from FNMA, FHLMC, FHA, and VA BBCLP. No more long
delays wondering about the decision! You will get all the advantages of
tracking your loan submissions when you join our team.

Once you have started submitting loan applications to BBCLP you are
guaranteed success in the face of change! In just four easy steps, you
can go from an average salesperson to the new age of being a
residential lending professional! We utilize your LOS so BBCLP is easily
integrated into daily functions.




                                      6
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
       Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider



                               Five Easy Steps

   •   Getting Trained

   Training Session 1

   1. Explanation of REBL (30 mins.)
   2. Explanation or how BBCLP works in a practical manner. (1 hr.)
   3. Q&A and forms handout. (30 mins.)

   Training Session 2

   1. REBL Training (2 hrs.)
   2. Q&A (30 mins.)

LUNCH! (1 hr.)

   Training Session 3

   1. REBL Training (2 hrs.)
   2. Q&A (30 mins.)

   Training Session 4

   1. REBL Training (1 hr.)
   2. Q&A (30 mins.)
   3. Certificates of Completion.

15 minute breaks are give each hour during all training.




                                       7
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                    2/1/2010
       Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider



   •   Get Your Client Pre-Qualified

As the Residential Lending Professional, you will be required to assist your
client in completing the application to pre-qualify them with the right
loan, and have them sign RESPA disclosure forms and all State required
forms provided by your employer. Regulatory requirement state you
much disclose specific information within three business days. BBCLP will
insure your borrower are provided all required disclosure specific to the
program you have chosen for them within the time allotted.

   •   Loan Submission

Once you complete the application and submit your file, your processor
work directly with you to provide friendly and positive feedback on what
your need to get your loan application approved.

   •   Review the Decision

After you have received the AUS (usually within 24 to 48 hours of
submission), review it with your client.

   •   Gather the Conditions

We ask that you collect as much of the necessary documents at
application and image them to BBCLP with your application, and we will
order an appraisal and open title report just like you usually do.

   •   Final Approval

Receive final approval and schedule the closing with your client! BBCLP’s
REBL is a win-win system. Not only will you benefit, but your clients will too.
Better income, better service, better system at no additional cost!

When you can offer quality mortgage origination with our assistance your
on your way, and your clients will benefit from your service. You will have
access to innovative marketing programs your employer, and all the

                                       8
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
       Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

support you need from BBCLP. It all adds up to a convenient system that
benefits you and your clients.


How Much More Could You Can Be Making?

Take a minute and do the numbers!

   •   Take the average loan amount of homes you expect to originate in
       one month.
       $____________

   •   Multiply that number by the average number of homes you can
       easily closing in a month with our system.
       $____________ X ___

   •   Get the total loan dollars on the closed loans per month.
       $____________

   •   Now multiply that number by ______%
       $____________ X (______% your structure commission agreement) =

   •   Income your firm can earn each month. $____________ (This help’s
       buy Junior’s new shoes)

Imagine income you are sending out the door now can stay with you, by
being as productive as you can, and it takes no more time from your busy
schedule when working with BBCLP. When collaborating with BBCLP we
support and eliminate redundant functions you must do now to insure
your client is being properly served! Making BBCLP your value added
mortgage service provider will help you succeed like never before in
today’s lending environment. You will make more money, gain more
control, and increase your referral business!

What Your Employer Expect From You

RESPA in general, requires you to do the tasks listed below to receive the
your fees and BBCLP was created to assist you meet and exceed not only
RESPA requirements, but those of your state laws as well.
                                    9
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
      Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider


  •   You must have enough training, and support available to
      adequately represent your customer's best interest. We believe you
      already know the basics, and we provide the rest in this handbook
      with support from BBCLP.

  •   You must take the client's loan application (which includes
      consulting with the buyer about the different financing options
      available, explaining the loan process, gathering pertinent
      information, reviewing timetables, etc). – Your processor is always
      here to walk you through the process!

  •   Your clients must read and sign a carefully worded Mortgage
      Disclosure Statement, Good Faith Estimate, and Truth In Lending
      that explains to them the service you are offering. The disclosure
      informs your client that, if you provide the loan origination service,
      you will earn the standard origination fee for this work. Other forms
      notify them of their rights, requirements, and your obligations as their
      loan originator.

  •   You must help collect the required financial information from the
      client (pay stubs, bank statements, W2s, etc.), and submit the
      required forms to get your loan application into processing.

  •   You should always complete the REBL Checklist, although not
      required it helps you stay on top of your file.

  •   You must maintain regular contact with your client to keep them
      updated on the status of their loan application, and assist them in
      gathering underwriting conditions.

  •   You must sign off on the Closing Fee Sheet in sufficient time and
      schedule the closing.

Being partnered with BBCLP completes your first step in becoming a top
notch residential lending professional, and we keep you competitive
through easy support tools.


                                     10
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                                    11
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
      Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

                                     Chapter 2
                                Initial Application

Pre-Qualification

The Residential Loan Professional takes a handwritten application, and
collects an application fee if applicable. If your client if out of town or
unavailable to signed at the time a purchase agreement has been
completed, you he need to indicate the application was taken “By
Phone or By Mail”, then email if possible all the disclosures for their
signature. Express to them the important of getting the signed documents
back to you as soon as possible as the application process cannot
continue without these signed documents.

If you have concerns that the client would not qualify for the loan
programs requested, you should proceed to the Initial Application stage
anyways, and review the application with your BBCLP Processor for a
second review. It will be the Residential Loan Professional’s responsibility
to immediately notify the client that you could not offer financial
consideration for reasons indicated, and that they will be provided in
writing a notification explaining why this determination was made. Take
special not that a decision must be made within 30 days of application to
be in compliance with RESPA.

Initial Application

Once you have gotten past the pre-qualification stage you will complete
the subject property information section of the application, and have the
client sign and date the URLA. The Residential Loan Professional’s date
and signature is always required at time of application. The Residential
Loan Professional will also collect any supporting documents the client
might have for the submission process. The original application, support
document and disclosures should be placed in the Client Folders and any
other procedures your employer requires.

While you are with the client, review the application and reconcile it with
your Residential Loan Professional/Processor Checklist. Complete the
necessary information to assign a loan number, and determine if any
additional information should be completed while the client is still
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available to sign any upfront documents. If circumstances do not permit
specific functions to be taken at this time, the Residential Loan
Professional should either establish a second meeting with the client or
advise then that the necessary disclosures will be mailed within Three (3)
business days of the signed application. You should set up a monitoring
system to assure compliance on application and disclosure. Please see
Disclosure Audit for the monitoring effort to insure compliance with all
Federal and State Statute.

The BBCLP will open title on a refinance and if a real estate agent is
involved it will be there responsibility as outlined in the Purchase and Sales
Agreement.        BBCLP will contact the agent to secure fully executed
document, and review it any issues underwriting might have. BBCLP will
include both agents information on the application process and keep you
apprised of any questions they have.

Required Disclosures on ALL loans

The Residential Loan Professional will be responsible to explain the
documents provided, and how they affect the client. Below is a list of
documents that will need to be completed, and provided to the client
within three (3) business days of application.

   o   GENERAL DISCLOSURE NOTICE TO THE BORROWER
   o   AFFILIATED BUSINESS ARRANGEMENT
   o   CREDIT SCORE INFORMATION
   o   EQUAL CREDIT OPPORTUNITY NOTICE (ECOA).
   o   FAIR LENDING NOTICE.
   o   RATE LOCK DISCLOSURE.
   o   TRANSFER OF SERVICING DISCLOSURE STATEMENT.
   o   USA PATRIOT ACT DISCLOSURE FORM
   o   USA PATRIOT ACT CERTIFICATION IN LIEU OF COPIED IDENTIFICATION.
   o   CONSEQUENCES TO CLIENT OF PROVIDING INACCUATE LOAN
       INFORMATION.
   o   APPLICATION DEPOSIT.
   o   CONTROLLED BUSINESS ARRANGEMENT NOTICE.
   o   AFFINITY BUSINESS DISCLOSURE.
   o   INFORMATION DISCLOSURE AUTHORIZATION AND CONSENT.
   o   RATE LOCK DECISION.
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   o   RATE LOCK AGREEMENT/DISCLOSURE.
   o   APPLICAITON DEPOSIT NOTIFICATION AND DISCLOSURE.
   o   OUR PRIVACY DISCLOSURE POLICY.
   o   MORTGAGE BROKER FEE DISCLOSURE.
   o   NOTICE TO THE HOME LOAN APPLICANT.
   o   IRS FORM 4506T
   o   ADJUSTABLE RATE LIBOR MORTGAGE LOAN PROGRAM DISCLOSURE
   o   ADJUSTABLE RATE COFI MORTGAGE LOAN PROGRAM DISCLOSURE.
   o   ADJUSTABLE RATE MTA MORTGAGE LOAN PROGRAM

FHA/VA Disclosures

   o   FHA/VA REAL ESTATE CERTFICATION
   o   FHA/VA FOR YOUR PROTECTION GET A HOME INSPECTION
   o   FHA/VA VALUE DISCLOSURE
   o   FHA/VA APPRAISAL NOTICE TO HOMEOWNER
   o   FHA/VA LEAD PAINT NOTICE
   o   FHA/VA IMPORTANT NOTICE TO HOMEBUYER
   o   FHA/VA EEM DISCLOSURE
   o   FHA/VA HUD FORM 92900-A
   o   FHA/VA INFORMED CONSUMER CHOICE DISCLOSURE
   o   FHA/VA ADDENDUM TO FNMA FORM 1003

VA Disclosures

   o VA FORM 26-1802A
   o VA FORM 26-0503 FEDERAL COLLECTION POLICY
   o VA FORM 26-0551 DEBT QUESTIONNAIRE
   o VA FROM 26-0592 COUNSELING CHECKLISTS FOR MILITARY
     HOMEOWNERS
   o FHA/VA ADDENDUM to FNMA FORM 1003


RD Disclosures

   o Form RD 1980-21
Submission to AUS “Ultimate Closings”


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As the Residential Loan Professional, you may be able to submit the loan
application to LP/DU to secure an eligibility status. At this time GUS the
USDA/RD AUS system is only available to approved lenders. Whether or
not you choose to upload your LOS system into the requested your BBCLP
processor will either complete that task for you or review your input for
accuracy and provide you with a copy. After these conditions are
reviewed with you, and if requested and authorized, a conditional
commitment letter will be sent indicating what documents will be needed
to support the Accept status before setting a closing date. Immediately
upon AUS approval and once all procedures have been preformed
BBCLP will start preparing your closing documents.

Applications that have a status of anything less than Accept/Eligible will
require further review for approval. Consult with your BBCLP processor
and origination manager for alternative financing solutions.

Getting as many documents as possible on the front end helps move the
file to closing and prevent unnecessary delays. It is your responsibility to
contact the client with the approval, and any conditions to be satisfied
prior to or at closing. Within 24 to 48 hours of a final approval, BBCLP will
provide your title agent closing documents. Review your lock registration
and all required forms in their entirety, and complete sections concerning
any fees and charges due you and cost BBCLP has included. Email or Fax
it back to BBCLP who will in turn start your closing document process.
BBCLP will finalize the process by sending the all required document to the
investor and title agent for the client’s signature. If the title company must
make changes as instructed, the file might need to be redrawn and
possible fees incurred, so a detailed review of the Doc Request forms is
imperative!

File Review

Files are updated continually and the previous days documents can be
review by you in the Client LOS folder. To review what documents have
come in that day you should review you client folder and date modified.
Please make sure you never make changes directly into the LOS, but
consult with your BBCLP processor so no missed communications occur.


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Actions That Must Be Perform Within 30 Days Of Application

1. ECOA Reg. B requires the creditor to notify an applicant of action
taken within 30 days after taking adverse action on an incomplete
application. If additional information is needed, BBCLP will send a notice
to you that should be forwarded to the client as written notification. The
letter will designate a reasonable time period to supply the information,
and indicate that failure to provide the requested information will result in
no further consideration given to the application.

2. ECOA, Reg. B requires that the lender notify the client within 30 days
after receipt of all completed applications concerning adverse action on
all application. BBCLP will provide you with the adverse notice that should
be provided to the client by you, and a copy will be place in the file with
specific reasons for the adverse action.

RESPA Compliance

The following is a brief summary of RESPA and its implementing regulation,
Regulation X, and their requirements. It is not intended to be
comprehensive. For example, RESPA and Regulation X may not apply in
all situations, and their application is not discussed below. Please consult
RESPA, Regulation X and independent legal counsel for complete
explanation of RESPA, Regulation X and their requirements.

The Real Estate Settlement Procedures Act ("RESPA") is a federal statute
that was enacted by Congress in 1974. A federal regulation implementing
RESPA ("Regulation X") also has been promulgated by the United States
Department of Housing and Urban Development ("HUD"). HUD is the
federal agency charged with administering and enforcing RESPA,
Regulation X and their requirements.

RESPA was enacted to provide consumers with greater timely information
on the nature and costs of the home buying/settlement process, and to
protect consumers from unnecessarily high settlement charges caused by
certain practices believed to be abusive. Among other requirements,
RESPA and Regulation X prohibit the payment or receipt of "any fee,
kickback or thing of value" (i.e., a referral fee) in exchange for the referral
of settlement service business. Settlement service business includes,
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among        other   services, loan origination services such as taking
applications, obtaining income verifications and communicating with a
client or lender.

RESPA and Regulation X permits a lender to make reasonable payments
to its Residential Loan Professionals and contractors for services actually
performed in the origination, processing or funding of a loan. Based on
interpretations of this provision in RESPA and Regulation X, residential
lending professionals and others may, in certain circumstances, provide
loan origination services and receive fair market compensation for the
services they actually perform.

Real Estate Based Lending is designed around this provision. Residential
Loan Professionals are required to perform certain settlement services in
connection with loans originated through the program, and the
compensation received by the Residential Loan Professional is intended to
be fair market compensation for the services they actually perform.

Other Federal and State Compliance

The following is a brief summary of other federal and state statutes,
regulations and laws that impact the Real Estate Based Lending program,
and your performance of services under our program. It is not intended to
be comprehensive. Please consult the statutes, regulations and laws, and
independent legal counsel, for a complete explanation of other
applicable federal and state statutes, regulations and laws.

Among other federal laws, the Truth in Lending Act ("TILA") and the Equal
Credit Opportunity Act ("ECOA") impact Real Estate Based Lending, and
the Residential Loan Professional’s performance of services under our
program. The TILA, and its implementing regulation, Regulation Z, were
enacted and promulgated to assure meaningful disclosure of credit terms
so that the consumer will be able to compare more readily the various
terms available to the consumer. Under the TILA, certain disclosures must
be provided to the client prior to the consummation of a mortgage loan
transaction.

The ECOA, and its implementing regulation, Regulation B, were enacted
and promulgated to require that lenders engaged in the extension of
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credit make that credit equally available to all creditworthy consumers
without regard to race, color, religion, national origin, sex, marital status,
age, receipt of public assistance or the fact that the consumer in good
faith exercised any right under the Federal Consumer Credit Protection
Act. In addition to the prohibition against discrimination, the ECOA and
Regulation B also contain, among others, requirements regarding the
provision of appraisal reports, evaluation of applications, spousal
signatures, and the provision of adverse action notices.

Regarding state laws, most jurisdictions have enacted licensing statutes
that may require residential lending professionals, builders, financial
institutions/lenders and mortgage brokers to obtain a license and satisfy
various other financial, educational and operational requirements. Most
jurisdictions also have enacted laws that impose, among others,
requirements regarding the types of fees that may be charged to a
consumer in connection with a mortgage loan transaction and the
persons entitled to receive such fees, as well as certain jurisdiction-specific
disclosures that must be provided to the consumer.

Compliance with Regulatory Agencies

Listed below are various regulatory agencies and statutes that they in-
force. As the Residential Loan Professional you should become familiar
with each of them in an effort to provide the client the best possible
service. We have hi-lighted the ones that have a direct effect on the
application process and you. In the Initial Seminar we will discuss each of
these requirements. This is one of the most important parts of your job. If
you need additional instruction, do not hesitate to ask your Origination
Manager or Processing Center for individual training.            It is your
responsibility to become completely familiar with them. If you have any
concern as to their meanings ask BBCLP to explain the implications in user-
friendly terms.




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•   Equal Credit Opportunity Act

    Regulation B, Section 202.5a of ECOA (Copy of Appraisal)

    ECOA Regulation B requires the lender to provide a copy of the
    appraisal to the client or disclose that one will be provided upon the
    clients written request.

    Regulation B, Section 202.9 of ECOA (Notice of Adverse Action on
    incomplete application)

    ECOA Regulation B requires the creditor to notify an applicant of
    action taken within 30 days after taking adverse action on an
    incomplete application. If additional information is needed, a
    written notice shall be sent specifying the information needed,
    designate a reasonable period of time to supply the information and
    also indicate that failure to provide the requested information will
    result in no further consideration being given to the application.

    Regulation B, Section 202.9 of ECOA (Notice to applicant within 30
    days after receipt of completed application)

    ECOA Regulation B requires that the lender notify the client within 30
    days after receipt of a completed application concerning the
    lender’s adverse action on the application.

    ECOA Regulation B requires that the Adverse Action Letter (AAL) list
    the specific reasons for the action taken.
    Regulation B, Section 202.13 of the Equal Credit Opportunity Act
    (Creditor must note race and gender)

    The Equal Credit Opportunity Act (ECOA) Regulation B requires the
    creditor to note the race or national origin and sex of the client(s) on
    the basis of visual observation or surname. The initial and final 1003
    were reviewed for those loans selected involving face-to-face
    applications (Telephone and mail applications are reviewed under
    question 1).


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    Regulation B, Section 202.12 of ECOA (25 month retention of files)

    ECOA requires document retention for 25 months. In addition certain
    state statutes impose longer file retention periods.

•   The Home Mortgage Disclosure Act

    Regulation C, Section 203.4 of the Home Mortgage Disclosure Act
    (Section X of application must be completed)

    To comply with the Home Mortgage Disclosure Act (HMDA) of 1975
    Regulation C, the Federal Reserve System requires that all fields of
    the HMDA Register be completed at the time a decision is made on
    the file.

    Regulation C, Section 203.4(a)(7) of the Home Mortgage Disclosure
    Act (Annual income of applicant’s)

    HMDA requires the lender to report the annual income of
    applicant(s). The underwriter's adjusted income on the loan
    approval form is compared with the income stated on the final
    application.

•   Truth In Lending Regulation Z

    Regulation Z, Section 129 of the Truth in Lending Act (APR disclosure
    on ARM’s and balloons)
    TILA Regulation Z requires for ARM or Balloon loans; “if the annual
    percentage rate may increase after consummation in a transaction
    secured by the consumers principal dwelling with a term greater
    than one year; the following disclosures (the booklet titled
    “Consumer Handbook on Adjustable Rate Mortgages” or a suitable
    substitute for CHARM/Balloon loans) must be provided at the time an
    application form is provided or before the consumer pays a non-
    refundable fee, whichever is greater”.




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    Regulation Z, Section 226.19 of the Truth in Lending Act (TIL disclosure
    within 3 business days of application)

    The Truth in Lending Act’s (TILA) Regulation Z requires the lender to
    deliver the initial Truth-in-Lending Disclosure to the client within 3
    business days of receipt of an application.

•   RESPA Regulation X Appendix A to Part 3500 (The Good Faith Est.)

    Regulation X, Section 3500.7 of RESPA (GFE within 3 business days of
    application)

    RESPA Regulation X requires that the Good Faith Estimate (GFE) be
    delivered to the client within 3 business days upon receipt of both an
    application and a property address.

    Regulation X, Section 3500.7(c) of RESPA (Use of particular provider of
    settlement service)

    RESPA Regulation X provides that if the lender requires the use of a
    particular provider of a settlement service, other than the lender’s
    own employees, and the lender also requires the client to pay any
    portion of the cost of such service, then the GFE must clearly state
    that use of the particular provider is required and that the estimate is
    based on the charges of the designated provider; give the name,
    address, and telephone number of each provider; and describe the
    nature of any relationship between each such provider and the
    lender. In the event that more than one relationship exists, each
    should be disclosed.

    Regulation X, Section 3500.7(c)(2) of RESPA (GFE fees based on
    common practice)
    RESPA requires that the GFE reflect that the fees that the client will
    normally pay or incur at or before settlement based upon common
    practice in the locality be appropriate. Each estimate must be made
    in good faith and bear a reasonable relationship to the charge a
    client is likely to be required to pay at settlement and must also be
    based upon experience in the locality. RESPA requires the lender to
    make its estimate based upon the lenders knowledge of the
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    amounts charged (flood certification, tax service, and assignment
    fee (MER’s)) by such provider.

    Regulation X, Section 3500.21(b) of RESPA (Loan Servicing Transfer
    Disclosure within 3 business days of application)

    The Real Estate Settlement Procedures Act (RESPA) Regulation X
    requires that the Loan Servicing Transfer Disclosure (LSTD) be
    provided to the client’s at the time of a face-to-face application or
    within 3 business days if the application was made by mail or
    telephone.

•   The Federal Emergency Management Agency

    42 U.S.C. Section 4012a of the Federal Emergency Management
    Agency (Flood Certification for all loans)

    The Federal Emergency Management Agency (FEMA) requires that
    a flood certification be obtained on all loans.            If the flood
    certification reflects that the property is in a Standard Flood Hazard
    Area, the lender must send a flood notice to the client at or before
    loan approval, but at least 10 days prior to closing.

•   The PMI Act

    Home Owners Protection Act of 1998 (Disclosure Statements for client
    and lender paid PMI and cancellation procedures)

    The Homeowners Protection Act of 1998 requires for loans with PMI,
    that the lender provide the client specific language in disclosure
    format, which if any refund would be available as determined by
    how the premium is to be collected.         In addition, a written
    amortization schedule must be attached.

    For all loans that must have Private Mortgage Insurance (PMI) a PMI
    Premium Payment Authorization form must be obtained from the
    client.


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•   Patriot Act

    The Uniting and Strengthening America by Providing Appropriate
    Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA
    PATRIOT Act, H.R. 3162, S. 1510, Public Law 107-56).
    This act requires the client to provide sufficient documentation on
    identity to assist the Federal Government in the search for any
    money laundering activities by terrorist foreign or domestic.

•   Credit Disclosure

    Fair and Accurate Credit Transaction Act of 2003- Public Law No.
    108-159Amendment to the Fair Credit Reporting Act – 15 U.S.C 1681-
    1681v

    The Fair and Accurate Credit Transaction Act of 2003 enables
    consumer to receive a copy of their credit scores when an
    application is related to a home mortgage.




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                                 Notes
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                                 Chapter 3
                  Closing Items You Need To Know About

Hazard Policy Requirements

There are two basic types of hazard insurance coverage, Replacement
Cost and Actual cash value. Replacement cost coverage is then
subdivided into three types: 1) replacement cost, 2) extended
replacement cost and 3) guaranteed replacement cost. Replacement
cost coverage pays claims based on what it costs to replace the
damaged portion of the structure up to the limits of the policy. This is the
requirement for most lenders. The extended replacement cost coverage
will pay an addition amount, depending on the percentage determined
by the company, for example 110%, 125% or even 135%. Guaranteed
replacement cost coverage will pay to replace the structure as it is
currently built. Actual cash value coverage pays claims based on the
depreciated value of the damaged portion of the structure.

As an example, imagine that our clients have hazard insurance coverage
of $150,000 and a $500 deductible. There has been a fire and the kitchen
was damaged. The cost to rebuild it is $30,000. Replacement cost
coverage will pay $29,500 ($30,000 less the deductible). Actual cash value
would pay whatever the insurance company believes the current value
of the structure is. So if they believe it has depreciated 50%, they would
pay out $14,500 and the homeowner would need to pay the difference.
The big difference is that any replacement cost coverage policy pays
claims based on what it costs to replace old materials with new materials
up to the limits of the policy. There is no deduction for depreciation.
Actual cash value does not do this. That is why it is not acceptable to
most lenders.

Also, regarding the coverage requirements. The amount of coverage
needs to be equal the lesser of 100% of the insurable value of the
improvements or the unpaid balance of the mortgage and the maximum
deductible is $1000.




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Power of Attorney

Investor that will accept a Limited (or Specific) Power of Attorney that
references the property, and authorizes the attorney-in-fact to enter into a
real estate transaction and to mortgage the property. The Power of
Attorney must:

   •   Indicate clearly that the mortgagor is appointing an attorney-in-
       fact to sign documents specifically to obligate the provider of the
       POA in the mortgage transaction being conducted.
   •   Precisely identify who is being appointed.
   •   Be signed and dated by the client.
   •   Be notarized.
   •   Be recorded prior to, or concurrent with, the security instrument.

Note: If the client is obtaining a FlexSaver loan or a second-lien HELOC
and has authorized another person to be his/her attorney-in-fact by using
a Power of Attorney (POA), the attorney-in-fact cannot sign the Bank
Signature Card. The client must sign the Bank Signature Card up front
when the POA forms are signed.

Title Company Approval: if an attorney in fact is going to sign the loan
documents, the title company issuing the title policy must approve the
Power of Attorney in additions to the lender.

Additional requirements:

   •   Clients must sign and date the initial 1003 and initial loan disclosures.

   •   Documents executed by the attorney in fact must be signed and
       typed according to the following examples:

All States except California:                     Mary Smith by Mary Smith for John Smith
                                                  John Smith
                                                  John Smith by Mary Smith as AIF
                                                  John Smith
                                                  Mary Smith as AIF for John Smith
                                                  John Smith
                                                  Mary Smith


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                                                John Smith by Mary Smith as
                                                attorney-in-fact
California:                                     John Smith by Mary Smith, Attorney-In-Fact
                                                John Smith by Mary Smith, Attorney-
                                                In-Fact

VA has additional POA requirements and they are as follows:

    •   The veteran must of consented in writing to the specific transaction
        by authorizing the use of a specific amount of entitlement and a
        stated sales price. It may be part of the Specific POA, the veteran
        could have signed the sales contract, or it could be a separate
        document that has been notarized or by his Commanding Officer.

Living Trust

Most lenders will accept Revocable Living Trust. The trust will need to show
the borrower as executor of the trust.

Maximum Loan Amounts

The maximum loan amount will vary between lenders and programs.
Generally, you have conforming and nonconforming loan limits. FNMA
and FHLMC and FHA or VA establish their loan limits. Note that VA also
has increase loan amount often referred to as “Jumbo VA”         FNMA,
FHLMC, and VA limits are uniformed in the contiguous United States and
are normally higher for Alaska and Hawaii accept for VA, while FHA and
RD has established loan limits by county. They also vary between 1 to 4
family residences. Check your program description to determine the
maximum loan amount your applicant can receive. If you find that the
amount requested is greater than the loan limits established by FNMA,
FHLMC, FHA, VA, or RD you must consider the loan request a
nonconforming product and find loan programs that allow for these
higher limits.




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Websites to find the loan limits are at:

http://www.efanniemae.com/sf/refmaterials/loanlimits/index.jsp
http://www.hud.gov/library/bookshelf18/pressrel/fhalimit/fhalimit.html
http://www.vba.va.gov/ro/central/cleve/Master_Training_Power_Points/Chapter_1_Loan_Basics.ppt
http://www.usdaloanapproval.com/USDALoanlimits.html

FNMA/FHLMC Agency Allowable Contributions

Contributions are the costs of those items paid by a seller or any interested
party to the transaction other than the client (i.e., builder, developer,
residential lending professional, or their affiliates) and include the
following:

    •   Funds contributed to a buy-down plan for the purpose of lowering
        the client's payment and/or interest rate on the loan.
    •   All payments in any form related to the financing (i.e., discount
        points, loan fees, origination fees, and/or commitment fees).
    •   The portion of the costs of other items related to the transaction that
        are normally paid by the client but are paid by the seller (i.e.,
        application fee, commitment fee, origination fee, homeowner
        association fees, transfer taxes, revenue stamps, attorney fees for
        client, surveys, title insurance, etc.).
    •   Closing costs are all 800 items, 1100 items, 1200 items, and 1300
        items on the HUD-I. If the purchaser has prepaid the appraisal and
        credit report the seller can include that in the reimbursement of
        closing cost items. FNMA will allow the unsecured financing of Lock-
        In Fees, Credit Report and appraisal provided it does not exceed
        $1000.00 and the client qualifies with the payment.
    •   FNMA and FHLMC will allow the seller to pay prepaid items (900 and
        1000 line items) when the program allows for contributions. These
        contributions, which must comply with the sales concession
        limitations set forth in paragraph F, include:
            o Interest charges covering any period after the settlement
               date.
            o Real estate taxes covering any period after the settlement
               date plus tax escrows (plus tax prorating to seller of pre-paid
               taxes).
            o Hazard insurance premium or homeowner’s insurance cost
               plus insurance escrows.

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         o Escrow accruals required for the renewal of mortgage
           insurance premiums.
         o All other closing cost items unless the seller specifically agrees
           otherwise in writing.
         o When requesting a waiving prorating of taxes on any
           conforming loan. It must be included in the limitation of seller
           contributions.

Note: FNMA and FHLMC allow the seller to pay the initial mortgage
insurance premium. It must be included in the limitation of seller
contributions.

   •   The maximum allowable amount of the contribution is based on the
       TOTAL loan-to-value ratio for FNMA and first mortgage LTV for
       FHLMC. The total sum of all contributions is limited to:

         o 3% of the lesser of the sales price or appraised value, if the
           mortgage has a loan-to-value percentage greater than 90%
           for mortgages on owner-occupied and second homes.
         o 6% of the lesser of the sales price or appraised value, if the
           mortgage has a loan-to-value less than or equal to 90% on
           owner-occupied and second homes.
         o 9% of the lesser of the sales price or appraised value, if the
           mortgage has a loan-to-value percentage less than or equal
           to 75% for mortgages on owner-occupied and second home
           properties.
         o 2% of the lesser of the sales price or appraised value on
           investment properties regardless of the LTV.

FHA Maximum Seller Contributions

6% of the Sale Price

RD Maximum Seller Contributions

None




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                                   2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                             (615) 556 2103 Direct
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                                  2/1/2010
       Brokers Best Contract Loan Processing
              A Premiere Contract Loan Processing Service Provider

                                Chapter 4
                              Who Is Your Client

Citizenship

Consult with BBCLP when you encounter applicants who are non-
residence or foreign nations. There are a host of limitation and visa
requirements places on these types of applicants. If your applicant has
an INS Residence Card you can treat them in the same manner as any
other citizen of the United States and some Visas will also be allowable for
mortgage financing.

Citizenship for loan application purposes can be put in four (4) catorgies.

   •   US Citizen
   •   Permanent Resident Alien – INS Form I-551, the client’s filed I-75 (I-
       751 is not requires when the clients have two years employment,
       residence, and credit in the U.S.), and Visa I-94
   •   Non-Permanent Resident Alien - To qualify as a client they must
       have an H-1A or B Visa
   •   Non-Resident Alien – Check with your investor for programs

Non-Purchasing Spouse

In a community property state a non-purchasing spouse must sign the
mortgage or deed of trust at closing. They are not required to complete
an application on a Conventional Loan, but must be included in
application with FHA and VA.

Some stated do not require the non-purchasing spouse to sign any
documents when the property is being purchased as their sole and
separate property. Your escrow agent if your best source for state specific
guidelines if you are not sure.

The spouse can sign the purchase agreement and take titles.

 Inform BBCLP of things like this while your taking your application. Keep
your Residential Loan Professional/Processor Checklist next to the
application and list any questions that come to mind on the back of the
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             A Premiere Contract Loan Processing Service Provider

form and your note pad. Regardless how minor it might seem BBCLP
needs to learn your style of application taking, and this is the tool that
starts the ball rolling in more the just one way!

Co-borrowers and Co-Signers

Co-borrowers take title to the property and obligate themselves on the
mortgage and note. A Co-signer has no ownership interest in the property
(does not take title) but must execute the loan application and sign the
mortgage note and will be liable for the repayment of the loan. The co-
borrower or co-signer’s income, assets, liabilities, and credit history are
included in the determination of creditworthiness.

   •   Conventional

When Co-borrowers or Co-signers income is used for qualifying purposes
with LTV’s greater than 90% usually requires them to occupy the property.
Less than 90% LTV’s may require if considering a Co-signer in your
application your client must secure an AUS approved/eligible without the
Co-signers income and have at least 5% of their own fund in the
transaction. LTV’s of 80% or less can have been gifted the entire cost.

   •   FHA

FHA will permit Co-borrowers, who take title to the property and will also
permit a Co-signer with no ownership interest in the property make
application; sign the note and income, assets, liabilities, and credit history
are considered equally in the application process.

   •   VA

VA will allow for non-spouse at application, but regardless of your investor
underwriting authority the case will have to be reviewed and signed off
by the VA Underwriting Office. You should add at least seven (7)
additional days in underwriting when determining your time-line to
process these request.




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                              (615) 556 2103 Direct
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                                   2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
      Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

                                  Chapter 5
                                   Income

Income Stability

The client should have at least 2 years history of employment in the same
field or work. This can in some cases include an applicant educational
history. If you find your applicant with less than 2 years due to attending
college or military duty consult with your lender on what documentation
will be required to consider the clients loan request.

Salary-Wages

All income must be analyzed to determine if it will be likely to continue for
the first five years of the mortgage. If the client is planning to retire during
this time they must qualify at the projected retirement income. Have your
applicant consult with their human resource department and their
financial planner to provide a projection letter for their forecasted income
after retirement. You will also have to provide evidence of sufficient
assets to support this income, I.e. 401k plans, and portfolio statements
supporting the stated income the client intents to receive.

The effective income of both the client and co-applicant is considered in
determining the ability to meet the proposed mortgage payment and all
other monthly obligations. Income derived from employment must be
verified by using a VOE or alternative employment documents provided
by the client such as 30 days consecutive pay stubs within 90 days of the
closing and W-2’s for the proceeding 2 years. The VOE must be sent to
the employer or if using alternative documents you must secure original
document and make copies, then certify them as “True Copies of the
Originals.” When reviewing an applicant’s employment history have the
client provide a letter of explanation for any gaps between employers.

If the client is a member of a union and receives job assignments directly
from the union, then a verification of employment should be sent to the
union office in order to verify the client’s rate of pay and their standing in
the union. Tax returns for 2 years will be required, with W-2’s from each
employer for the said time frame. In addition verification of employment
will be required from each employer. Though a union may verify a rate of
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                                    2/1/2010
      Brokers Best Contract Loan Processing
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pay, the rate may not be used unless the client has worked steadily with
no gaps in employment with the union. Should there be gaps, an
average in income will be used to qualify the client. It is important to note
that if the client works directly for a company and is a member of a union,
then they need to be treated as any other salaried employee by
requesting information from his company by means of a VOE.

Overtime & Bonus

A 2-year history for this type of income is required, along with verification
of employment and in some cases 2 years tax returns. Large variances
from year to year requires more than a 2-year history. A steady decline
from year to year could preclude use of this type of income. Income
received by the client may be considered only if it can be established
that the income will continue during the foreseeable future.

To consider overtime income, the employer must verity the number of
hours worked in overtime per week and that it is likely to continue. Pay
stubs showing year to date earning plus W-2 for the previous 2 years will
be required to average this income.

When an applicant receives income from bonuses, this income is not likely
to be considered unless it can be established as continuous. Bonus
income must be likely to continue and the employer needs to provide
the amount of the bonus income for the previous 2 years. This income will
then be averaged. It will also be necessary to determine the manner of
payment of the bonus, whether they are paid annually, semiannually,
quarterly, or monthly. Many times the bonus income maybe used to offset
a debt, rather than being considered as effective income.

Part Time

Part time income can be used to qualify if it has been worked for 2 years
and is expected to continue. Seasonal income can be considered if the
client has worked the same job for the at least 2 years and expects to be
rehired. When income is from a part time job, the concern of the lender is
for the well being of the client. If it does not appear that the client will get
sufficient rest due to working excessive hours per week (60-80), the part
time income will not be considered. A letter from the client may be
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                                    2/1/2010
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

needed, setting out the work schedule from his primary and part time
jobs, indicating the sufficient rest is received in order for all the income to
be considered. Again, a 2 years history must be provided on the type of
employment.

Commission

Commission income requires to be averaged for the past 2 years. Your
applicant will be required to provide the past two years tax returns and a
current pay stub. Any un-reimbursed employee business expenses must
be deducted from the client’s income. This is usually shown on IRS Form
2106 or Schedule C in some cases. Any decrease in commission income
requires a significant compensating factor to consider the income. If the
commission has been received for less than 2 years, it usually will not be
counted as income unless the client has been promoted within the same
company and his pay structure now includes commissions. A letter for the
employers stating the client’s likelihood of continued commission income
would be required. When all or a major portion of the client’s income is
derived from commissions, it will be necessary to establish the stability of
such income. This stability is dependent upon the length of the client’s
employment. Several items need to be determined when taking the
application in order to properly pre-qualify the client. These items include:

         •   If a base salary is stated, whether it is guaranteed or a draw
             against commissions.
          • Determine if the commission income stated includes any
             other type of income such as a car allowance or bonus.
          • When are commissions received             i.e., monthly, quarterly,
             semiannually, etc.
          • Whether the client receives company paid expenses or does
             he pay expenses out of pocket.
          • Does the client have a company car or receive a car
             allowance.
When sending or completing a VOE for the client, these inquiries need to
be verified by the employer.




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                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

Alimony/Child Support Received

Alimony and Child Support must continue for at least 3 to 5 years. To use
this income the client must provide a copy of the divorce or child support
awards statement along with verification these funds have been paid to
the client in a timely manner. You can do this by providing 12 months
canceled checks or bank statements showing the deposits. A letter from
the court of authority may also be required to confirm payments are
received and are current.

Interest and Dividends

Interest and Dividend income will be verified through securing bank
statements confirming the balance of accounts that have been
generating income for the past two years as shown on the clients
Schedule B and D of their tax returns for the past two years.

Rental Income

Rental income is verified for several different documents and/or a
combination thereof. If the subject property is a 2-4-unit development the
client will need to provide copies of lease agreements currently on the
property that can be provided by the seller if it is a purchase, and
forecasted rent from the Operating Income Statement Form 216
completed by the appraiser. If the client has other income property they
will need to provide tax returns for the past two years with Schedule E
income showing the income average, along with current leases on the
properties. Prospective and current income may be taken into account.
Appropriate adjustment will be applied to reduce the estimated rental
income by analyzing operating expenses and vacancy losses for the
market.

FNMA requires that all investment properties sold to them must meet
specific requirements stated on the Operating Income Statement FNMA
Form 216 that is completed by the appraiser. In order for an investment
property to be an acceptable risk, it must support itself financially. This
means that the debt service coverage ratio as calculated by the
appraiser must be at least 90%. On an owner occupied 2-4 family
residence, FNMA allows a debt service coverage of 75%.
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                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

To determine the income-producing ability of an investment property, the
appraiser completes the following forms.

         •   Single Family Comparable Rent Schedule Form 1007 for
             single-family properties.
         •   Small Residential Income Property Form 1025 for 2-4
             family properties; and

If the property is currently rented, leases must support the forecasted rents.
This does not mean the forecasted rents must be equal to the rents in the
leases. The appraiser will use forecasted rents in lieu of actual rents to
determine the debt service coverage ratio.

If the cash flow is positive, the lender will show the income as a positive
cash flow for the client. If the cash flow is negative and the debt service
ratio is 90% or 75% respectfully the loss must be included in the client's
monthly obligations.

In addition to having at least 3 months PITI in reserves, the client must have
adequate reserves of one year’s replacement cost.

FHLMC requires that all investment properties sold to them must have a
completed “Rental Income and Expense Analysis” Form 65C completed
by the lender.

Anticipated rental income from units not occupied by the client must be
substantiated by using the income approach on the appraisal and
obtaining copies of the present leases, income and tax statements and
other sources deemed reliable. BBCLP will complete Form 65C, in lieu of
completing the proposed “Monthly Housing Expenses” section of the
URLA. After deducting any income received for furniture, an adjustment
factor of 75% is to be employed in calculating the Proposed Rental
Income.

         •   The client must demonstrate experience in successfully
             managing investment property.
         •   The client has sufficient remaining liquid assets after closing
             which may be used to supplement payment during

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         •   Vacancies and to make regular and emergency repairs to
             the property as necessary.

Rental income from other real estate owned by the client is to be shown
in the rental income section on the URLA. Any rental income related to a
property owned by the client in a previous tax year must be substantiated
by the prior years tax returns. Rental income not substantiated by tax
returns must be verified by other valid means such as a settlement
statement and lease agreements.

When the client is relying on rental income on the subject property to
qualify for the loan, they must maintain rent loss insurance. Rent loss
insurance compensates the client for a loss or reduction in rental income
caused by fire or any other casualty covered by the hazard insurance
policy. This is a standard provision contained in most hazard policies for
rental dwellings. Advise your applicant that when securing a policy from
an insurer they will be required to have at least 6 months coverage for
rental loss in their policy.

Auto Allowances

Only the amount that exceeds the actual expenses as shown on IRS Form
2106 can be used as income. The client will need to provide 2 years tax
returns in addition to verification from the employer that auto expense
payments will continue for the foreseeable future. If there is a loss, it must
be treated as a debt, and indicated on the job related expenses on the
URLA.

Trust Income

Trust income can be used if it will continue for at least 3 to 5 years. The
client must provide a copy of the trust agreement or any other
documents that will confirm the amount, frequency, and duration of the
payment.




                                       41
                      621 Doolittle Road, Woodbury, TN 37190
                                (615) 556 2103 Direct
                                 (615) 563-6771 Fax

                                     2/1/2010
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

Projected Income

Raises, bonuses, cost of living allowances, etc., can be used in some
cases if scheduled to begin within 60 days of closing. There must be a
non-revocable contract in place to consider this income.

Employment by a Family Owned Business

For the client who is employed by a family member, you must obtain
standard verification, pay stubs, W-2’s and evidence the client has no
ownership interest in the business by providing their tax returns or that of
the business.

Self-Employed

If the client has 25% or more ownership in the business, they are
considered self employed. Tax Returns for two years plus an un-audited
balance sheet signed by the client must be provided. Stipulation the
client has less than 2 years self-employment history the application can be
considered if they have a history of employment in the same field or
recent formal training. In any case there must be provided at least one
complete tax cycle and a profit and loss statement provided.

When you have a self-employed applicant collect the following
documents, to have their income analyzed as soon as possible to assure
their income is accurately represented.

         •   2 years personal Tax Returns with all schedules
         •   2 years business Corporate Tax Returns as supported on the
             Schedule E for a Sub S corporation. Keep in mind there are
             two types of corporations and only the sub corporation will
             be shown of the client tax returns.
         •   A year to date profit and loss statement.
         •   A balance sheet.
         •   In some cases the lender may require a business credit report.




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                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

Recently Discharged Veterans

When working with an applicant whose prior employment was military
duty, a copy of their DD Form 216 should be provided. This is their
separation or discharge form from military service, and shows what
specialties training the veteran had while servicing.

All gaps since the discharge must be explained. It is acceptable to use
income from current short-term employment if it can be established that
while in the military the veteran was in the same line of work.

If the veteran were in a new line of work, than his job in the military, a
statement from your applicant would be required regarding the training
previously received to perform his new job. If the employer indicated that
the client is a “trainee” or “on probation”, the loan request cannot be
approved until they have completed their training period.

A veteran retiring after twenty years of service or more, whose retirement
pay is not sufficient to meet the mortgage payment and other debts,
needs only minimal income from other employment. It would be proper
to give consideration to income from his new job is he had some training
for it previously. However if they were in a probation period the above
statement would apply.




                                    43
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                                    44
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                                    45
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

                                 Chapter 6
                                  Assets

Written Verification of Deposit or Bank Statements

At time of application you must obtain a list of verifiable assets for closing
and adequate reserves. It is important that you accurately estimate the
Good Faith and Details of Transaction when determining sufficient funds
to close. Once you have listed on assets to be verified on the application
BBCLP can order verification of deposit or your clients can provide two
consecutive months bank statement. When using Bank Statements to
verify funds the following items are required:

   o Photocopies of ALL pages.
   o Computer Generated copies for the institution must be signed by
     the preparer, provide the name of the institution and title of the
     preparer. It must also have starting and ending balances with all
     transactions covering a 60-day period.
   o Any large deposit in excess of normal income deposits must be
     explained.

Access to Fund

   o All sources of funds must indicate the client as the account holder.
     Accounts with additional owners that are not a part of the
     transaction must sign a disclosure advising the reader they are
     aware that the funds in the account will be used the loan
     transaction. You should determine if the co owner of the account
     has a different address and advise BBCLP.
   o Funds to be received from an employer, trust or other source must
     be documented with a letter from the provider or other similar
     supporting documents
   o The client must indicate the amount to be withdrawn from a 401k,
     KEOGH, ESOP, SEP or any other employee savings plan.




                                     46
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
     Brokers Best Contract Loan Processing
               A Premiere Contract Loan Processing Service Provider

Details of Transaction

It is essential that you accurately reflect the funds required from your
client. By accurately completing the Good Faith Estimate and completed
the Details of Transaction with it and the Purchase Agreement in hand you
can correctly complete the application and give your client a reasonable
cost estimate.

Bridge Loans

A bridge loan is an acceptable source of funs, as long as it is secured by a
valid second lien against the client’s previous or other property.

   o It must have regular scheduled payment or payment must be
     estimated or a reasonable estimate from the loan terms must be
     calculated in the DIT.
   o If it is a short-term loan it must be renewable.

Cash Advances on Credit Cards

Cash advances are not permitted as an acceptable source of funds for
down payment. Clients can charge for the appraisal and credit report. If
you have an FHA application you cannot use the charged items when
determining the client (3%) three percent minimum investment. VA will
allow for cash advances but the additions monthly cost must be included
in the DTI.

Cash Saved at Home

Cash saved at home is not acceptable for conventional financing. FHA
and VA allows for cash saved at home. The client will be required to
deposit the funds in escrow and provide a budget showing how they
saved the money and not seasoning are required.




                                       47
                      621 Doolittle Road, Woodbury, TN 37190
                                (615) 556 2103 Direct
                                 (615) 563-6771 Fax

                                     2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

Collateralized/Secured Loans

Conventional and FHA programs will allow funds to be borrowed from a
required investment as long as funds are fully secured by an existing
marketable asset. These assets may include stocks, bonds, automobiles,
real estate, the cash value of a life insurance policy and a tax refund
anticipated loan provided by a lending firm filing automatic returns.

VA states that funds to complete the transaction can be borrowed.
However, when the sale price exceeds the established value, the
difference must be paid from the veteran’s own personal funds and may
not be borrowed.

Commissions from Sale of Subject Property

Some lenders will allow commissions dues on a purchase transaction to be
used as part or all of the down payment. Your client will need to provide
a letter from his broker with outlines his normal commission structure.

Corporate Funds

   o If the client is using corporate assets they must own at least 51% of
     the stock.
   o Provide a current balance sheet from the business to support the
     cash asset.
   o Funds must be verified in a corporate account.
   o A letter from the CPA stating the company is capable of disbursing
     the funds without impairing the operation of the company.
   o A copy of the corporate resolution indicating the client will be
     permitted to withdraw the funds.

Conventional loans will require the client make at least a 5% down
payment with their own funds.




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                                  2/1/2010
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Earnest Money Deposit

Provide a canceled earnest money check drawn from the clients
account, cashier check or money order. Additionally your client will need
to provide 60-days consecutive bank statements clearly showing the
funds were available at time of withdrawal.

Employee Savings Plans (401K)

Only vested portions of your clients employee saving plan can be used as
the source of down payment and closing cost. Secure the client’s most
recent statements. When determining available funds take the current
balance less any loans and multiply it by 70%. This will allow for any tax
obligations for early withdrawals.

Gambling and Lottery Winnings

Winnings from gambling or the lottery are acceptable funds to close and
must be documented by a statement of earnings from the casino or
lottery commission.

Gift of Equity

A Gift of Equity may also be provided by all the parties indicated “Gift
from a Relative”.

FHA bans the Gift of Equity to all parties except between family members.

Gift from a Relative

Gift fund are acceptable form an immediate family member, i.e. spouse
or similar relationship, parent, stepparent, legal guardian, grandparent,
brother, sister, child or employer. Provide your client with a Gift Letter to
be completed by the donor and have them return it as soon as possible.

Additionally, is the funds have already been deposited secure a copy of
the deposit transaction. If the gift will be provide at a future date have
the donor provide the gift funds to escrow.
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Gift from Employer, Church, Municipality, or Non-Profit

Secure the legal agreement provided to the client that specifies the terms
and conditions of the gift or grant.

Footnote: All conventional loans with gift where the LTV is 80.01% or more
require in client investment of at least (5%) five percent.

Lawsuit and insurance Settlement

When an your client anticipates a lump sum settlement as the result of a
lawsuit or insurance settlement, they must provide you with a copy of the
settlement agreement and a copy of the check and deposit slip. If the
money has already been deposit have them provide the bank statement
the money was deposited in, address for the attorney who represented
them and any other documents they might have.

Life Insurance Cash Value

When using cash value from a life insurance policy your client will need to
provide evidence of it value with a copy of the policy, statement from the
policy provider stated the cash value and if any other loans have bee
collateralize with the policy.

Relocation Benefits

   •   Allowable for owner occupied properties only.
   •   Secure a copy of the relocation agreement.

Relocation Equity Buyout

   •   Secure a copy of the relocation Equity Buyout Agreement.
   •   Purchase agreement form the employer or third party relocation
       company.
   •   Any evidence of an equity advice by the employers, its agent or a
       HUD 1 between the client and their employer.


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Rent Credit

The client purchase agreement should contain any rent credits to be
applied during the term on the lease. They need to provide cancelled all
cancelled checks for the lease term. BBCLP will secure a rent analysis on
the property to support any additional credits to be applied. Rent credits
must be supported by the appraiser to adjustment will me make and
additions down payment may be required.

Sales of an Asset

Documentation to support proceeds for the sale of an asset, including
personal property, must be a Bill of Sales, or settlement statement that
clearly

   •   Identifies the property and seller
   •   Shows the net proceeds
   •   Disposition of any liens
   •   Signed by all parties
   •   And provides the name, address and phone number of the buyer.

Sale of Real Estate

   •   Copy of a fully executed and certified HUD 1
   •   When your client relying upon funds to close from the sale of a
       jointly owned property, and the co owner of the property sold is not
       an applicant to your transaction, it is necessary to verity the
       percentage of net funds your client received in the transaction.

Sweat Equity

FHA defines sweat equity as labor performed or materials furnished by
your client before closing. The sweat equity can be equivalent to a cash
investment to the extent of the estimated cost of the work or material
provided. Sweat Equity may also be gifted.

   •   On existing construction on the repairs or improvements listed on
       the appraisal are eligible for sweat equity.
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   •   On proposed construction the sales contract must indicate the tasks
       to be performed by your client during construction.
   •   Your clients labor may be considered as equivalent of cash if they
       can demonstrate their ability to complete the work in a satisfactory
       manner, i.e. work related experience.
   •   Clean up, debris removal and other general maintenance, or
       landscaping cannot be included as sweat equity.
   •   If your client is furnishing materials, evidence of the source of funds
       used to purchase and the market value of the material must be
       provided.

Tax Refund

Many applicants rely heavily upon their tax refunds to have sufficient
funds to close. If your client uses this source of fund the following is
required:

   •   A copy of the filed tax returns together with any documentation
       reflecting an EZ or Rapid Refund signed and dated by you client
   •   A copy o the deposit slip of the funds deposited.

Trade Equity 1031 Exchange

If your clients are performing a 1031 Exchange it must be between similar
like properties, and your clients will need to provide the following:

   •   An appraisal on the traded property not more than 120 days old, a
       title search on the traded property which list all liens
   •   The trade agreement between your client and the other property
       trader in the exchange.




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            A Premiere Contract Loan Processing Service Provider

                                 Notes
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            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                             (615) 556 2103 Direct
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                                  2/1/2010
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             A Premiere Contract Loan Processing Service Provider

                                  Chapter 7
                                   Credit

Bankruptcy

While bankruptcies are serious matters to consider they are not final
reasons not to make the loan for your applicant. FNMA and FHLMC take
different positions when considering the client(s) ability to repay the loan.
If you have a client with a discharges Chapter 7 bankruptcy consult the
BBCLP to determine what specific requirements they will consider when
reviewing the loan. In some cases an Un-discharged Chapter 13 will also
be considered, and you will need to consult with BBCLP to determine
what specific requirements they will need from the client to review their
file.

Importance of the clients Credit Rating

Good credit is more important than money in the bank. When a potential
buyer is ready to buy a house, a second home, an investment property or
refinance their existing home, their credit report carries a lot of weight with
mortgage lenders. It is not based on their character, intentions, or
circumstances. There is nothing personal about it. It is just a piece of paper
representing them and their past. If their credit report is incorrect,
inaccurate or misleading, getting the best mortgage to buy a home may
be harder to get. Since their previous credit repayment performance
reflects your attitude toward credit obligations, determining your credit
worthiness is one of the most important components when taking the
application. Therefore review their credit report to establish their credit
history by examining their performance with mortgage payments as well
as with revolving and installment debt such as department store and bank
credit cards and car loans.

Payments received 30 days past the due date are usually recorded as
late in their credit report. However, lenders are generally not concerned
with isolated, minor slow payments unless an ongoing pattern is
established. Credit reports also include public records such as collections,
repossessions, foreclosures and bankruptcies. Though these items may
indicate past credit problems there are often valid reasons, and a well-
established pattern of excellent recent credit will be taken into
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consideration. Lenders will typically allow one late mortgage payments in
the past twelve months, but a pattern of late mortgage payments over an
extended period of time exceeding twelve months may effect their ability
to secure the best interested and financing terms available.

Credit Rating

Credit rating is a system used by some sub prime lenders to determine
whether to give you a loan. The lender may examine their past credit
history to evaluate how promptly you pay your bills and look at other
factors as well, such as the amount of your income, whether they own a
home, and how many years they have worked at their your job. A credit
rating system awards points for each factor that the lender considers
important. Sub prime lenders generally offer some type of credit to those
applicants designating them a credit score of A- to D. The ratings impact
the LTV and interest rate.

Understanding FICO (Fair Isaac) Scores

In the mortgage-lending world, FICO (Fair Isaac) scores either make or
break your applicant when it comes to obtaining a home mortgage or
getting the best rate for your applicant. This is the "mortgage rating"
system used to get a mortgage from both conventional and sub-prime
lenders.

Simply, FICO scores are numbers calculated based upon your credit
history. The better your applicant’s credit, the higher their number or score
will be - the worse your credit, the lower the score. In some instances, lack
of credit results in "no score" on their report requiring you to provide
"alternative credit" via their rental, utility, telephone, insurance, or other
unreported credit payment histories from company’s that may have
extended credit such as a buy here pay here auto dealer, or furniture
company.

Functionally, FICO scores were created to simplify the mortgage lending
industry - to the contrary many brokers and lenders feel this manner of
scoring creates more problems. Generally, FICO scores of 620 or less will
have a serious impact on getting your applicants loan application
approved through a conventional lender, and you may have no
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alternative but to search lending programs in the sub prime category.
There are reasons why your applicant may have a FICO score lower than
620, such as limited create use or an isolated late payment on the only
account the client has. In these cases continuing the submission process
is warranted, consult with your processing if this situation occurs.

The client may have recently been shopping on the Internet for favorable
financing terms and their application may have been submitted to
several lenders who pulled their own credit report to determine what time
of financing to offer. Frequent inquires can drive the FICO score down.
The situation often happens when an applicant has been looking to
purchase or lease an automobile. A good way to determine that this
may have been the case is to review the recent inquires on the credit
report. If you find this is the case have the client to write a letter of
explanation regarding this matter.

To have the best confidence level about your applicants credit score we
always recommend you pull a tri-merged credit report. With this report
you can see what score the agency has designated to your applicant. To
determine the 620 rule pick the middle score of the three. This is the FICO
score the Processing Center will be using to determine the clients credit
worthiness.

Clearing Credit Mistakes

It is common to find negative items on a credit report that does not
belong to your applicant. Recent studies indicate that up to 45% of all
credit reports include erroneous items. Under the Fair Credit Reporting
Statutes your applicant has the right to challenge such items. Credit
reporting agencies must investigate disputed items and correct them
within 30 days. They must also demonstrate that their information is
accurate, and if they do not, they are in violation of the law. Anything
they cannot prove must be removed from the report. A corrected version
of the report must be sent to anyone who recently received the
inaccurate version.

If your applicant finds mistakes on their credit report, the first step is for
them to send a challenge letter to the agency that reported the item.
When a credit reporting agency receives a dispute, it must investigate
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and record the current status of the disputed items within a "reasonable
period of time," unless it believes the dispute is "frivolous or irrelevant." If the
credit-reporting agency cannot verify a disputed item, it must delete it. If
your applicant’s report contains erroneous information, the credit-
reporting agency must correct it. If an item is incomplete, the credit-
reporting agency must complete it.

For example, if the credit report showed that they were late in making
payments on accounts, but failed to show that they were no longer
delinquent, the credit-reporting agency must show that their payments
are now current, or if the credit report showed an account that belongs
to another person, the credit-reporting agency would have to delete it.
Also, at the client’s request, the credit-reporting agency must send a
notice of correction to any report recipient who has checked their file in
the past six months.

If a reinvestigation does not resolve their dispute, the Fair Credit Reporting
Act permits your applicant to file a statement of up to 100 words to
explain their side of the story. The credit-reporting agency must include
this explanation in their report each time it sends it out. Credit reporting
agency employees often are available to help them word their
statement.

Be aware, however, that when negative information in their report is
accurate, only the passage of time can assure its removal. Credit
reporting agencies are permitted by law to report bankruptcies for 10
years and other negative information for seven years. The start dates for
these periods are based on the date of last financial activity. Therefore, if
your applicant has a Profit and Loss indicated on their account several
years ago and recently made a payment on the account the clock
begins ticking based on the new date the last payment was received.
Also, any negative information may be reported indefinitely for use in the
evaluation of their application: $50,000 or more in credit, a life insurance
policy with a face amount of $50,000 or more, or consideration for a job
paying $20,000 or more.




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                               (615) 556 2103 Direct
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                                     2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

How to Register a Dispute

Your applicant must make their dispute directly to the credit-reporting
agency. Although the Fair Credit Reporting Act does not require it, the
Federal Trade Commission staff recommends that they submit their
dispute in writing, along with copies (NOT originals) of documents that
support their position.
In addition to providing their complete name and address, their letter
should clearly identify each item in their report they dispute, explain why
they dispute the information, state the facts, and request deletion or
correction. They may want to enclose a copy of your report with the items
in question circled.

The client should send their dispute by certified mail, return receipt
requested, and keep copies of their dispute letter and enclosures. By
doing so, they can document what the credit reporting agency received.

Clearing Open Collection Accounts

If their credit report shows they have open collection accounts, they can
request the collection agency to remove the items from their credit if they
agree to get it paid. They may also be able to get a release known as a
"Settlement Letter" that authorizes the local credit-reporting agency to
remove it from their mortgage credit. Most collections need to be paid
before they qualify for a mortgage however; some loan programs allow
collections to remain unpaid up to a stated dollar amount if they were
caused by a medical problem or will not attach to the title on the
property. Lenders seldom allow open collections to remain on
conventional financing and you may have to search sub prime programs
in this event. Your applicants may want to consult with an attorney or
work through a debt arbitration service.

Re-Aging Old Pass Due Accounts

Your applicants are also entitled to ask creditors to re-age your account
(start over) so the old late payments will no longer appear on your credit
record. Each month creditors send in a magnetic tape to the credit
agency and if they delete your applicant’s account on the tape it is
automatically removed at the credit agency.
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Building Credit

If your applicants have an "insufficient credit file" or "no credit file" and
they have accounts with creditors that do not appear in their credit file,
they can ask the credit-reporting agency to add this information to future
reports. Although they are not required to do so, many credit reporting
agencies will add other verifiable accounts for a fee.
For the mortgage loan they may be able to build credit by obtaining
credit letters from local sources such as your landlord, phone or utility
company, or anyplace they have purchased a TV, tires, furniture, etc., or
any business that can write a credit reference letter for them. Generally
the client will need to provide three credit letters if they do not have at
least this amount of credit ratings on their credit report.

Credit Inquiries

When considering buying a new home, be careful with credit inquires.
Generally, lenders do not like a lot of inquires on a credit report. Excessive
inquires can result in a credit denial as easily as bad credit. While you
have your applicant with you have them provide a statement regarding
each credit inquiry for the past 90 days.        Make sure that there is no
additional new credit that is not showing on the credit report. If there is,
be sure to include this information when calculating your ratios, and
completing the application.

Child Support/Alimony as a Debt

This is an area you need to be clear on with any applicant regardless of
gender. Many times it may not be disclosed by the client that they are
obligated to pay child support simply because it does not appear to be
an issue by the loan taker and the client is unaware that it is considered as
a debt obligation by the lender, and many times this issue will appear
during the processing of the loan through public records. Many times an
applicant will have deductions from their pay check or from monthly
withdrawals from their bank statements. If you do not explore the
possibility of this obligation during the application process and it is
discovered later, it can have a serious implication of the client’s ability to
qualify for the loan request.

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Job Related Expenses

Refer to comments made in the income section of this kit, specifically in
the area regarding Commission Employees.

Ratios

After you have determined the client’s income and debt obligations you
will need to total the principal and interest, taxes, insurance, MI, and HOA
dues, then divides this amount into the clients gross income to determine
their top ratio. It should not exceed 25% to 28% of their gross income. To
determine the bottom ratio you must consider the housing expenses
indicated above along with any revolving and installment debts over 10
months. Remember to include child support, alimony and job related
expense in this total, then divide this amount in the client gross income to
determine the bottom ratio. It should not exceed 33% to 36%. There are
compensating factors to consider when ratio exceed these amount such
as large reserves, increased earning potential, and high FICO scores. If
your ratios are in excess of these amounts consult with BBCLP to determine
if the client’s merit continued consideration for the loan amount
requested. Many times your processing can secure additional information
you may not have considered. Submitting the loan request to Automated
Underwriting should always be done before you determine that the
client(s) don’t qualify, as we have seen loan request receive approvals
that far exceed the stated ratios.




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      Brokers Best Contract Loan Processing
              A Premiere Contract Loan Processing Service Provider

Credit Reporting Agencies

Following is a list of credit reporting agencies. It is important to make your
dispute directly to them.

      Experian                          Equifax Credit Information Services
      P.O. Box 2104               P.O.Box740256
      Allen, TX 75002                   Atlanta,GA30374
      Phone (800) 682-7654              Phone(800)685-1111

      TransUnion                       CSCCredit
      P.O. Box 390                     652NorthBeltEast,Ste.133
      Springfield, PA 19064-0390 Houston,TX77267
      Phone (601) 933-1200             Phone (713) 878-1900

Agencies that may be able to offer help for your applicant the particular credit
assistance needs.
Bankcard Holders of America (BHA)      National Fraud Information Center
524 Branch drive                       10 a.m. - 4 p.m. EST, Monday - Friday
Salem, VA 24153                        Phone (800) 876-7060
Phone (703) 389-5445

National Foundation For Consumer Credit    Debtors Anonymous, General
Service
8611 2nd Ave., Suite 100             Box 400, Grand Central Station
Silver Spring, MD 20910              New York, NY 10163-0400 Phone (800)
388-2227

Federal Trade Commission
Board of Governor, Federal Reserve
Division of Consumer and Community Affairs System
(Fair Credit Reporting Act)
Washington, D.C. 20580
20th & C Streets, N.W.
Phone (202) 326-2000
Washington, D.C. 20551

Debt arbitration services delivered by Edge Solutions, Inc.
      http://www.ezdesk.com/arbitration.htm




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Letters of Explanation

Frequently a letter of explanation will help if there are unusual
circumstances. Emergencies, extended out-of-area travel during the
payment period, mortgage payments which rolled over from one month
to the next, banks which held checks until they cleared, medical
problems, bills sent to the wrong address, items that really don't belong to
your applicant, items that were covered in a divorce settlement are just
some of the possible explanations.

Requesting or Disputing Information

When the client is requesting information or disputing information on their
credit report they should always include: Their full name, spouse's full
name (if relevant), current address, previous addresses going back five
years, the date of their birth, social security number(s) and phone
numbers (home and work).
If disputing information include: a credit ID# from the reporting bureau,
the account name they are disputing, the account number and the
reason they are disputing the item.

After the credit-reporting agency receives your letter it has reasonable
time, which in most cases has been considered 30 days to investigate any
requests and is required to send them a written report of its findings.

Rapid Rescoring

You've probably come across claims made by certain companies that
they can fix your credit in 24 hours. Most of those claims are fraudulent,
but you can get your credit score recalculated in a few days by any one
of the 200 companies who specialize in rapid credit rescoring and who
have special relationships with the three major credit reporting agencies --
Equifax, Experian and TransUnion. In addition, these rapid rescoring
companies can only be accessed by mortgage lenders and brokers and
not by the general public. This means that if you want to have your
client’s credit report rapidly rescored. The cost is modest, around $25 to
$50 for each item they fix, and is certainly worth paying since an improved
credit score can result in reducing the monthly mortgage payment
significantly.
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To illustrate how rapid rescoring can make a difference -- suppose your
client have been a victim of identity theft and there is a credit card
account you didn't open appearing on your credit report showing as a
default account. Normally, it would take at least a month (but more
realistically, two or three months or longer) to clear this matter up and get
the item removed from your credit report. However, in the meantime, this
negative item on the credit report has lowered your credit score to 650,
which means your client will be approved for a mortgage loan, but at an
interest rate of 7% instead of the 6% rate being offered to those with credit
scores above 720. As a result, the monthly mortgage payment is going to
be much higher than it would be if that negative item wasn't on the credit
reports. Contact a rapid rescoring company and have the credit card
account removed from your credit report and your credit score
recalculated. Three days later, the credit score is now above 700 and you
qualify for a mortgage loan for the 6% rate, saving your client from paying
additional interest over the loan term.

Who should use rapid rescoring? Those with FICO credit scores below 660
should check in to rapid rescoring if planning to apply for a mortgage
loan in the next month.

Rescorer can't get negative items, such as late payment notations, or
items that are in dispute removed. A rapid rescorer also cannot improve
your clients credit score if your problem is too much debt that you can't
pay off today. A rapid rescorer can only improve your credit score if the
creditor admits to a mistake or agrees to remove specific information. For
example, you might owe a big balance on a credit card that is negatively
affecting your ability to get a lower mortgage interest rate. You can pay
off the credit card electronically today and have a rapid rescorer get
your credit score recalculated within 72 hours rather than waiting for your
payment to show up on your credit report a month later.

Note that a rapid rescorer requires evidence to complete the rescoring
process. For example, a creditor might have sent you a letter admitting
that an account being reported as your clients really isn't theirs and they
intend to remove it from your credit history. Or, a creditor might admit
that an account was fraudulently opened in your clients name by a thief
and has agreed to remove it from the credit report. Although a rapid
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rescoring company usually requires that you provide proof, some might
contact the creditor directly and obtain the proof for you.

It is also important to note that a rapid rescorer can't fix all problems within
72 hours as they often claim in their advertising. Sometimes it might take
them a week or two, but in any event, it is always more rapid than fixing
credit report errors the traditional way -- by mail, waiting a month or two
for changes to occur in one's credit report before a new, improved credit
score can be calculated.




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                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
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                                    2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

                                 Notes
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                                 Notes
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                                    Chapter 8
                   Property Acceptance and How It Might Be Titled

Condominium Guidelines

Extended Limited Review Guidelines:

For owner occupied properties, lenders can secure a limited review of a
condominium project up to an LTV/TLTV of 100% with a Loan Prospector
(LP) feedback of Accept or better. For non-owner occupied properties,
lenders are allow a limited review of a condo project up to an LTV/TLTV of
75% with an LP feedback of Accept or better.

For a second home, the maximum LTV/TLTV for limited review remains at
95%. For all non-conforming products (i.e. Jumbo, A-Minus, Stated Income,
etc.), the limited review guidelines remain the same.

In order for a project to meet limited review guidelines, all common
elements and amenities for the subject phase must be 100% complete,
per the appraisal. Please see the table below for the new LTV/TLTV
guidelines.

Condominium Limited Review of Attached Condominiums
Maximum LTV/TLTV
                                Conforming        Conforming               Stated
Occupancy          ____________ Accept/A+         A Minus      Jumbo      Income

Primary Residence              100                90           80         75
Second Home                     95                90           80         75
Investment Property             75                NA           NA         NA

Limited Review Documentation Requirements
   • Appraisal
   • Condominium Master Insurance policy evidencing at least $1 million
      in comprehensive general liability coverage, and blanket
      replacement coverage for the buildings.



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In addition to the extended limited review guidelines described above,
the owner occupancy and presale requirements have been recently
adjusted on most projects that were subject to a full review.
Those changes are as follows:

Class I: At least 70% of units in all phases completed must be sold or under
Contract. 70% of units sold must have been sold to individuals for use as
their primary residence or second home.

Class II: At least 50% of the entire project must be sold or under contract to
individuals for use as a primary residence or second home (For Class II
projects, if the subject loan is for a primary residence or second home,
there are no presale or owner occupancy requirements) Class Ill: At least
90% of the units in the entire project must be sold or under contract. At
least 60% of the units sold or under contract must be sold to individuals for
use as their primary residence or second home.

Please discuss with BBCLP for descriptions             and   documentation
requirements for Class I, II, and Ill projects.

Previously, there was no distinction made between smaller (2-4 unit) and
larger (greater than 4 units) condominium projects. The following criteria
must be met for loans that are on units within condominium projects
consisting of 2-4 units:

   •   Each unit is separately metered (per the appraisal)
   •   The project, including all common elements and amenities, is
       complete
   •   No more than one unit in the project is Non-Owner Occupied
       The project must meet insurance requirements, which include:

   •   The project must carry blanket replacement coverage for the
       building(s)
   •   At least $1 million in comprehensive general liability coverage
   •   Fidelity bond (employee dishonesty) coverage is not required on 2-4
       unit projects.




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FHA - Manufactured Housing Checklist

Items # 1-4 are required on all Manufactured Homes; Items #5-14 are also
required for Manufactured Homes appraised as New Construction,
Proposed Construction, or existing less than 1 year old.
1) FHA Manufactured Housing Addendum to the Appraisal Report
(completed, and signed by the appraiser)

2) Individual water supply test, and sewage disposal system installation (if
applicable)

3) Termite forms of the National Pest Control Association, NPCA 99a and
NPCA 99b (where applicable) (Mortgagee Letter 99-3 and Mortgagee
Letter 01-04)

4) Certification from the licensed professional engineer that the
foundation complies with the guidelines published in the Permanent
Foundations Guide for Manufactured Housing, HUD-7584, dated
September 1996. (For a copy, see Mortgagee Letter 97-36).

Per page 1-09d of the HUD HOC Reference Guide - Manufactured
Homes: Foundation Compliance: “All foundation systems, new and
existing, must meet the guidelines published in the Permanent
Foundations Guide for Manufactured Housing, dated September 1996. A
certification attesting to compliance with this handbook must be
obtained from a licensed professional engineer and included in the
insuring file. This procedure does not apply when the current FHA client
refinances their loan. It is applicable for all re-sales.”

5) Engineered foundation design drawing / design worksheets as per
permanent Foundations Guide for Manufactured
Housing.
6) Complete set of Plans and Specs, foundation and perimeter enclosure
plans

7) HUD 92541 - Builder Certification of Plans, Specifications and Site

8) HUD 92544 — Warranty of Completion of Construction (Builder 1 yr.
Warranty)
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9) Heat Loss Calculations (when available)

10) Location of site on Flood Map

11) Initial/Open Hole Inspection by an FHA Fee Inspector, (can be waived
if obtaining a 10 year approved Home Owners Warranty).

12) Final inspection by an FHA/HUD Fee Inspector

13) Client acknowledgement of receipt of: Carpet Identification #’s,
Manufacturer Warranty papers; and Insulation Certificate.

14) Certificate of Occupancy, or its equivalent (*).

(*) CO. equivalent per HUD = Building Permit or Inspection Card — fully
signed, indicating all inspections have been completed; with the DE
Underwriter certifying that these forms of documentation are considered
the equivalent for a CO for the specific county and/or jurisdiction.

Mortgagee Letters web-site:
http://www.hud.uov/offices/hsi~/inItrmenu.cfm

FHA/HUD’s appraisal and property Requirements for Manufactured Homes
can be found at the following web site:
http://www.hudj. gov/offlces/hsg/sfhi/ref/sfhl-09.cfm

FHA Builder Loans/Proposed Construction

                Single Family, Town Homes, and 2 to 4 Units

   1) FHA Conditional Commitment i.e. appraisal/Early Start Letter
   2) Initial Inspection by a HUD fee approved panel inspector
   3) Framing Inspection by a HUD fee approved panel inspector
   4) Final Inspection by a HUD fee approved panel inspector
                                Or
   1) FHA Conditional Commitment/Early Start Letter
   2) Building Permit
   3) Certificate of Occupancy
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                                Condominiums

   1)   FHA Conditional Commitment i.e. appraisal/Early Start Letter
   2)   Initial Inspection by a HUD fee approved panel inspector
   3)   Framing Inspection by a HUD fee approved panel inspector
   4)   Final Inspection by a HUD fee approved panel inspector

                                Manufactured Homes

   1) FHA Conditional Commitment i.e. appraisal/Early Start Letter
   2) Initial Inspection by a HUD fee approved panel inspector
   3) Final Inspection by a HUD fee approved panel inspector

Under Construction or Less that One Year Old

                                Single Family, Town Homes, and 2 to 4 Units

   1) Final Inspection by a HUD fee approved panel inspector
   2) Ten-Year Warranty or the LTV is limited to 90% LTV
                              Or
   1) Building Permit
   2) Certificate of Occupancy
   3) Ten-Year Warranty

                                Condominiums

   1) Final Inspection by a HUD fee approved panel inspector
   2) Ten Year Warranty

Manufactured Homes

   1) Final Inspection by a HUD fee approved panel inspector
   2) Ten-Year Warranty

Note that your Conditional Commitment, i.e. appraisal will call for a
foundation inspection on Manufactured Housing either proposed or
existing construction by a Structural Engineer. BBCLP will advise you of the

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cost for this report so you can advise the buyer and seller if not already
addressed in the purchase agreement.

Secondary Residences

The secondary home must be in a vacation area or there must be a
reasonable explanation as to why the client is requesting secondary
residence financing, i.e. the client performs a large amount of work for his
or her employer in the area that the property is located in and it is
conducive for the client to maintain a residence for this purpose. Be
cautious that this does not create an employee business expense for the
client. If so, the underwriter will ask for tax returns to confirm the client
does not use IRS form 2106 or a Schedule C to deduct these expenses.

Investment Property

If the client intends to rent the property at anytime during the course of
the year, this property will be considered investment property and you will
have to limit the loan parameters to those allowed. Be sure to check if
the program description sets limits when financing an investment property.
Many programs reduce the LTV and will increase the interest rate, along
with other items of limitation. The cost to perform an appraisal will
normally increase due to the extensive reporting measures the appraiser
will have to perform. Make sure you have consulted the appraiser on their
fees for these types of property.

Revocable Trust

Make sure your trust includes your client as a Trustor, and Primary
Beneficiary and they will occupy the property. Otherwise check with your
investor for possible exceptions on second homes applications. When
ordering title a copy of the trust agreement needs to be provided to your
escrow agent, and the purchase must indicate the buyer in the name of
the trust.




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                                Chapter 9
                           FHA The Application
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The Interview

In additions to the Uniformed Residential Loan Application FNMA 1003,
FHA and VA provide a (4) four-page addendum to the application; it
contains certifications to be signed by the client and Residential Loan
Professional.

FHA requires the lender to conduct a face to face interview with all first
time home buyers making less than a 10% down payment, unless they
have received pre-purchase counseling from an approved HUD
approved housing counseling agency.

For any purchase transaction for property built prior to 1978 the seller was
required to provide the buyer a “Lead Paint Notification” with an
opportunity to have a property inspection. Additionally, the seller when
accepting the FHA contract was to provide the buyer with acceptable
disclosure called “Importance of Home Inspections” and an “Amendatory
Clause to the Purchase Agreement”. If your client doesn’t have a copy
of the disclosures provide them, and advise them that is must be
executed as of the date of the purchase agreement. They should consult
with their residential lending professional or legal consult if an issue
regarding these disclosures occurs.

FHA has a host of additional disclosures you may not be familiar with. We
have listed them in this section and will maintain a set in your shared drive
for immediate use.

   •   FHA Real Estate Certification            Signed by all Buyers, Sellers, and Agents at time of
       Purchase Agreement signing.
   •   Amendatory Clause             If not incorporated into the Purchase Agreement.    Signed by
       borrower(s) and Seller(s).
   •   Lead Paint Notice If it is a purchase and the property was constructed prior to 1978.
   •   FHA Value Disclosure Signed by the borrower(s) at application.
   •   Important Notice To Homebuyer Signed by the borrower(s) at application
   •   Informed Consumer Choice Disclosure Signed by the borrower(s) at application
   •   EEM Disclosure Signed by the borrower(s) at application.
   •   Hotel and Transient Use Certification signed by the borrower(s) at application
   •   For Your Protection Get a Home Inspection Signed by the borrower(s)                             at
       application
   •   Notice To Homeowner            Signed by the borrower(s) at application

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Credit

FHA loans do not use FICO scoring methods as with conventional financing,
however all lenders have a minimum FICO Score which is generally no
lower than a mid score of 620.

Seller Concessions

Sellers or other interested third parties such as residential lending
professional, developers, or a combination of parties may contribute up to
(6) six percent of the sales price toward borrower’s closing cost, prepaid
items, points, and other financing concessions.

Inducements to Purchase

FHA will require a dollar for dollar loan amount reduction if the following
items are indicated on the purchase agreement.

   •     Contributions in excess of 6 (six) percent
   •     Gift Funds not meeting FHA gift requirements
   •     Decorating allowances
   •     Repair allowances
   •     Moving costs
   •     Excess Rent Credit
   •     Any credit on a third party transaction
   •     Leaving of Personal Property by the Seller without a statement it is
         being left a convenience to the seller.

Determining Maximum Financing

When determining maximum financing you must determine a sales price or
property value for some refinances. A good place to locate value is a
zillow.com. FHA stated the must contribute at least (3%) three percent into
the transaction, and if the property is located in a high cost area the down
payment is reduced 2.85%, so long as the client has at least (3%) three
percent invested in the transaction through borrower paid closing cost.




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MIP Calculations

Up front MIP (UFMIP) is based on the borrower's credit score and the loan
to value (LTV) of 1.75 to 2.25 percent of the loan amount.

The monthly MIP is .55% of the loan amount divided by 12 on loan to
values greater than 90%.

To further explain MIP there are two MIP premium on every FHA loan:

   •   Up Front MIP which is 1.75% to 2.25% of the loan and typically
       financed in the loan amount,
   •   Monthly MIP, which is, in most cases .55% of the loan amount paid
       monthly.

Your AUS will provide you with the exact amount of MIP.

Property Owned Less than One Year

If you client is refinancing a property that was purchased less than on year
ago at time of closing on the new loan, the loan amount is will be based on
plus allowable closing cost.

Cash Out Refinancing

FHA allows for cash out up to 85% LTV. Your client must have owned the
subject property for the past 12 months and is available on 1 and 2 unit
properties only and have maintained satisfactory credit.

Streamline Refinancing without and Appraisal

When refinancing and currently FHA insured loan the only requirement to
qualify is that it reduces your client monthly payment; a satisfactory
mortgage history of no more than one late payment in the past 12 months;
and the new loan amount cannot exceed the existing loan amount, or an
appraisal will be required.

   •   Unpaid Principle and Interest up to 60 days
   •   Allowable closing cost
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Existing FHA loans being refinanced that are less than 12 yrs old are entitled
to a refund that BBCLP calculate for you and have the credit applied the
your client at closing.

See Chapter 9 “Property and How it might be Titled” for more information
on FHA
Residential Loan Professionals with an active Real Estate License cannot
originate loans insured by FHA under the REBL Program. We will advise you
of any changes as they occur.




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                                    81
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
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                                  Chapter 10
                              VA The Application

The Interview

In additions to the Uniformed Residential Loan Application FNMA 1003, VA
and FHA provide a (4) four-page addendum to the application; it
contains certifications to be signed by the client and Residential Loan
Professional. Note that VA only offers owner occupied programs.

For any purchase transaction for property built prior to 1978 the seller was
required to provide the buyer a “Lead Paint Notification” with an
opportunity to have a property inspection. Additionally, the seller when
accepting the FHA contract was to provide the buyer with acceptable
disclosure called “Importance of Home Inspections” and an “Amendatory
Clause to the Purchase Agreement”. If your client doesn’t have a copy
of the disclosures provide them, and advise them that is must be
executed as of the date of the purchase agreement. They should consult
with their residential lending professional or legal consult if an issue
regarding these disclosures occurs.

Certificate of Eligibility

The certificate of eligibility determines the amount of entitlement, and
may be decreased by the amount of guaranty issued by VA on any
outstanding VA mortgage make by your client. Veterans depending on
the amount of eligibility remaining might be eligible for more than on VA
loan. BBCLP with determine the eligibility for you. You client can secure a
copy of their most current certificate by visiting VA.Org. When requesting
a COE the following items will be required have your client sign and date
VA Form 26-1880 and BBCLP will submit the request for a current COE.

Determining Maximum Eligibility

To determines your client’s eligibility check with BBCLP to find out what the
maximum loan amount allowable from VA at time of application. Even if
your loan amount exceeds the allowable amount set by VA, so lender will
accept partial guarantees and you can exceed the maximum loan

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amount. There are several methods to determine eligibility and we
recommend you let us do the calculations to insure accuracy.

Funding Fee Calculation

The VA funding fee is required by law. The fee, currently 2.15% on no down
payment loans for a first-time use, is intended to enable the veteran who
obtains a VA home loan to contribute toward the cost of this benefit, and
thereby reduce the cost to taxpayers. The funding fee for second time
users who do not make a down payment is 3.3%. The idea of a higher fee
for second time use is based on the fact that these veterans have already
had a chance to use the benefit once, and also that prior users have had
time to accumulate equity or save money towards a down payment.

For purchase and construction loans, members of the regular military fall
into the category of first time user or subsequent user. For first time users,
no down payment requires a 2.15% fee, up to 10% down payment
requires a 1.5% fee, and 10% or more requires a 1.25% fee. For subsequent
users, no down payment requires a 3.3% fee, up to 10% down payment
requires a 1.50% fee, and 10% or more requires a 1.25% fee.

For the category of Reserves / National Guard, first time users with no
down payment requires a 2.4% fee, up to 10% down payment requires a
1.75% fee, and 10% or more requires a 1.5% fee. For subsequent users, no
down payment requires a 3.3% fee, up to 10% down payment requires a
1.75%    fee,   and    10%   or    more     requires    a   1.5%    fee.

Cash-out refinancing loans for regular military requires a 2.15% fee for first
time users and a 3.3% fee for subsequent users. For Reserves / National
Guard, the requirement is a 2.4% fee for first time users and a 3.3% fee for
subsequent users. On interest rate reduction loans, the VA funding fee is
.50%    and    it   is   1.0%    on     Manufactured        Home     Loans.

The following persons are exempt from paying the funding fee:

   •   Veterans receiving     VA   compensation      for     service-connected
       disabilities.


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   •   Veterans who would be entitled to receive compensation for
       service-connected disabilities if they did not receive retirement pay.

   •   Surviving spouses of veterans who died in service or from service-
       connected disabilities (whether or not such surviving spouses are
       veterans with their own entitlement and whether or not they are
       using their own entitlement on the loan).

Please note that the VA has the final say on who is exempt.

Who is Exempt from a Funding Fee

Veterans with a service-connected disability are exempts from paying a
VA Funding Fee. If you see your borrower receives disability income from
the VA have them complete VA form 26-8937 Verification of VA Benefits
and Related indebtedness and Seattle Lender Solutions will submit the for
to VA for a exception for the Funding Fee at closing. In lieu of the above
form your client can provide the following.

   •   And awards letter issued within one year of application indicating
       the veteran is entitled to VA disability compensation.
   •   For a veteran who elected service retirement pay in lieu of VA
       compensation, a copy of the original VA notification of disability
       rating and documentations on the veteran’s service retirement
       income.
   •   If your client is surviving spouse it should be indicated on the COE.

Disclosures

VA requires all the disclosures of FHA, and some additional disclosures
specifically designed for VA Guaranteed Loans. We have listed them in
this section and will maintain a set in your shared drive for immediate use.

   •   FHA Real Estate Certification             Signed by all Buyers, Sellers, and Agents at time of
       Purchase Agreement signing.
   •   Amendatory Clause             If not incorporated into the Purchase Agreement.      Signed by
       borrower(s) and Seller(s).
   •   Lead Paint Notice If it is a purchase and the property was constructed prior to 1978.
   •   FHA Value Disclosure Signed by the borrower(s) at application.
   •   Important Notice To Homebuyer Signed by the borrower(s) at application
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   •   Informed Consumer Choice Disclosure Signed by the borrower(s) at application
   •   EEM Disclosure Signed by the borrower(s) at application.
   •   Hotel and Transient Use Certification signed by the borrower(s) at application
   •   For Your Protection Get a Home Inspection Signed by the borrower(s)                     at
       application
   •   Federal Collection Policy signed by the borrower(s) at application
   •   Debt Questionnaire signed by the borrowers(s) at application
   •   Counseling Checklist for Military Homeowners signed                  by the borrower(s) at
       applications


Cash Out Refinances with an Appraisal

Regular refinances are limited to owner occupied properties. The
refinance is limited to the following:

   •   Cash out limited to 90% LTV.
   •   Free and Clear properties are not eligible for cash out refinancing.
   •   All liens are eligible for refinancing.
   •   Full credit and appraisal package must be submitted.
   •   Your client must have sufficient eligibility
   •   Rate and term refinances may be up to 100% LTV plus closing cost
       (prepaid, repairs or improvements cost not allowed) so long as
       there is no cash back to your client.

Interest Rate Reduction Refinancing Loans without an Appraisal

When determining the base loan amount you can include up to 60 days
interest, prepaid, allowable closing cost and up to 2 discount points. In
some cases you cab exceed the 2% rule but it must be paid in cash. You
can use the IRRRL Worksheet provided in your shared drive to determine
maximum eligibility. If your client was not the original borrower, your client
cannot refinance the loan with VA. Only the VA guaranteed loan can be
refinanced. All other liens must be subordinated, and your client interest
rate must be lower that the existing rate.




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Rate Reduction Refinancing of an ARM

When refinancing an existing ARM mortgage to a Fixed Rate loan, your
clients Principle and Interest cannot increase more than 20% or full credit
and underwriting (appraisal not required) but be performed.

Seller Concessions

VA states that seller concessions are anything of value added to the
transaction by the seller for which the buyers pays nothing additional
value and which the seller is not customarily expected to pay. Such
concessions can include the VA Funding Fee, prepaid interest, escrow
setup, discount points to a television, or a microwave oven.

Any concession or combination cannot exceed 4% of the of the loan
amount, and VA does not allow for a dollar for dollar reduction in the loan
amount. It simply does not allow excess Seller Concessions!




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                              Chapter 11
                    Overview of the Guaranteed Rural
                         Housing Loan Program
FORMS

At time of processing there is only one additional form you will need to
provide in your submission for an RD Insured loan.

      RD Form 1980-21, Request for Loan Note Guarantee – Have the
      borrower sign this form at time of application.

Features

100% financing - No down payment required
No Mortgage Insurance Premium
No Maximum Loan Amount Limit
No borrower reserves required
No limit on seller or gift contributions - or grants
No asset limit
The Guaranteed RD Loan is a Stand-Alone product
Can be used with THDA
Single family homes, townhouses and approved condos in eligible rural
areas
Closing costs/repair costs can be included in the loan (points cannot be
included unless applicant is low income) up to the Appraised Value.
Guarantee fee is 2% of loan amount. No other fees involved.
The 2% fee may exceed the appraised value if included in the loan.
Income limits - 115% of the HUD median income limits
Repayment Ratios: PITI = 29% & total debt ratio = 41%. Your lender will run
your loan application through RD’s AUS which is called GUS and may
allow for higher ratio limits. At this time RD only allow approved USDA/RD
lenders access to GUS so when submitting your application to MTSP we will
not be able to provide any GUS findings.
Fixed Interest Rates - Rate may not exceed the FNMA 90 day yield rate
plus 60 basis points rounded up to the nearest one quarter of one
percent 30 year term
Loans saleable in secondary market.
Refinancing Rural Development guaranteed loans is allowed if the current
lien is insured by RD.
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Weblinks for Rural Development

www.rurdev.usda.gov/tn
www.rurdev.usda.gov/regs/

Income Limits

73600 for 1 to 4 Family and 97150 for 5 to 8 Family - Chattanooga,
Clarksville, Stewart Co, Cleveland, Jackson, Johnson City, Kingsport-Bristol.
Memphis, Hickman Co, Macon Co,

73600 for 1 to 4 Family and 98450 for 5 to 8 Family - Knoxville, Memphis,
Morristown, Nashville, Murfreesboro, Franklin.

ADD 8% OF 1-4 PERSON LIMIT FOR EACH PERSON IN EXCESS OF 8 PERSONS




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                       Income & Ratio Calculation
                               Worksheet
                        Guaranteed Rural Housing

Name of applicants____________________________________________________
Employee Initials________________ Date of Calculation____________________
Applicant $___________Co-applicant $ ___________Other $___________
Total Annual Income $____________
Adjustments to Income: (RD Instruction 1980.358 Pg. 43)
1. No. of minors:_______ X $480 $__________
2. No. of disabled/handicapped adults: ______ X $480 $__________
3. No. of full time adult students: ______ X $480 $__________
4. Deduct $400 for an Elderly Family (1980.302) $__________
5. Planned child care deduction (include documentation) $__________
6. Medical expenses for an elderly family > 3% of gross annual income
$__________
Total Adjustments $___________
Subtract Total Adjustments from Total Annual Income to arrive at
Adjusted Annual Income for program eligibility purposes $___________
Show moderate income limit here from page 4 $____________
Ratio Calculations (using repayment income)
Mortgage payment + taxes + insurance = total / monthly income = PITI
ratio________________ + _______ + ________ = _________ / _____________ =
____________
Total Housing Costs + other monthly debt = total / monthly income = Total
debt ratio________________ + ________________ = ___________ / __________ =
___________




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Tennessee Counties with Non-Rural Areas

ANDERSON
BLOUNT
BRADLEY
CARTER
DAVIDSON
HAMBLEN
HAMILTON
HAWKINS
KNOX
MADISON
MAURY
MONTGOMERY
PUTNAM
ROANE
RUTHERFORD
SHELBY
SULLIVAN
SUMNER
WASHINGTON
WILLIAMSON
WILSON

Maps are available at http://www.rurdev.usda.gov/tn
Select: Housing & Community Facilities
Ineligible Area Maps
Property eligibility may be checked “By Address” at
http://eligibility.sc.egov.usda.gov
Select: Single Family Housing under Property Eligibility
“Accept” Property Eligibility Disclaimer
Enter Property Address




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Tennessee Property Eligibility Determination

You may check Property Eligibility “by address” at the following web site:
http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do

1. Click on “Single Family Housing” under “Programs” and “Property
Eligibility”
2. Click on “Accept”
3. Enter the property address
The web site will respond with, “This property is (or, is not) located in an
eligible area” or, “Unable to determine address.”
If the response is, “Unable to determine address”, please confirm the
accuracy of the address and re-enter the accurate address. The system
will not recognize an inaccurate address. You may use the following TN
Real Estate Assessment Data web site to confirm property address
accuracy: http://www.assessment.state.tn.us/
If the response is, “Unable to determine address”, because the property is
new (within the last four years); it is because the address is not in the
global database used for the search due to property age. In this case,
you will need to make a property eligibility determination by comparing a
map showing the location of the property, such as you see in an
appraisal, and compare it to our TN RD Ineligible Area Maps, by county,
found at the following link:

http://www.rurdev.usda.gov/tn/ineligiblehousingmaps.html

The “yellow” areas are Rural Eligible Areas and the “green/gray” areas
are Ineligible Areas. You can “zoom-in” on these maps and use major
roads and landmarks to make a determination. TN Counties not
specifically listed are entirely Rural Eligible.

Applicant Eligibility

ELIGIBLE INCOME: The applicant's adjusted annual                   income cannot
exceed the appropriate moderate income limit in                   Exhibit C of RD
Instruction 1980-D. To determine whether a borrower’s            income is eligible
based         on        the     property  location                 please      visit:
http://eligibility.sc.egov.usda.gov
ADEQUATE AND DEPENDABLE INCOME
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The applicant must have an adequate and dependably available
income (2-year employment history or formal training beyond high
school).

REPAYMENT ABILITY (Ratios)

The applicant must demonstrate adequate repayment ability. The
applicant is considered to have adequate repayment ability when the
ratio of the proposed housing costs to income does not exceed 29% and
the Total Debt Ratio does not exceed 41%. Ratio waiver requests must be
accompanied by documentation of compensating factors.

CREDIT HISTORY

The applicant must have a credit history which indicates a reasonable
ability and willingness to meet obligations as they become due.

The applicant must have a credit history which indicates a reasonable
ability and willingness to meet obligations as they become due. Any of
the following are indicators of an unacceptable credit history unless the
cause of the problem was beyond the applicant's control:

      1. Incidents of more than one secured or unsecured debt payments
      being more than 30 days late if the incidents have occurred within
      the last 12 months. This includes more than one late payment on a
      single account.

      2. Loss of security due to a foreclosure if the foreclosure has
      occurred within the last 36 months.

      3. Outstanding tax liens or delinquent Government debts with no
      satisfactory arrangements for payments, no matter what their age,
      as long as they are currently delinquent and/or due and payable.


      4. A court-created or affirmed obligation (judgment) caused by
      non-payment that is currently outstanding within the last 12 months.

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      5. Two or more rent payments paid 30 days or more past due that
      have occurred within the last three years.

      6. Accounts which have been converted to collections within the
      last 12 months (utility bills, hospital bills).
      7. Collection accounts outstanding with no satisfactory
      arrangements for payments, no matter what their age as long as
      they are currently delinquent and/or due and payable.

      8. Non-RD debts written off within the last 36 months such as
      Charge-Offs and Profit & Loss.

     The following does not indicate an unacceptable credit history

A bankruptcy discharged more than 36 months prior to application date.
A satisfied judgment which was completed 12 months before the date of
application.
No credit history (Alternative Credit History/Nontraditional Credit
accepted):

      1. Must include three sources covering recent 12 month period
      2. Show periodic payments and must detail payments as 0x30,
      0x60, etc
      3. Subjective statements such as, “Satisfactory” or “Acceptable”,
      are not allowed

                  Additional risk layers are not advised!

Acceptable sources of credit verifications: Any form of the below
mentioned reports should indicate on the report that it meets the
standards of Fannie Mae, Freddie Mac, HUD or VA.
RMCR-(Residential Mortgage Credit Reports) This is preferred.
MMCR-(Merged, Tri-Merged, or Multi-Merged Credit Reports) Acceptable
as long as the applicant is not disputing the contents of the report.
NTMCR-(Non-Traditional Mortgage Credit Reports) To be used only when
applicant has no previous trade sources developed.

There is no established minimum credit score for eligibility, however most
lender have a minimum credit score of 580.
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PREVIOUS LOAN

The applicant cannot have had a previous RD loan which resulted in a
loss to the government unless RD determines the loss was beyond the
applicant's control.

OTHER FEDERAL DEBT

The applicant cannot be delinquent on any tax or non-tax debts and
there can be no judgment liens against the applicant's property for a
debt owed to the Federal Government. The Lender will check HUD's
Credit Alert Interactive Voice Response System, (CAVIRS)

PRESENT HOUSING

The applicant cannot presently own a dwelling which is in the local
commuting area and is structurally sound, functionally adequate and
large enough to accommodate the needs of the applicant's household.

CITIZENSHIP

The applicant must be a citizen or a legally admitted alien.

OCCUPANCY

The applicant must have the potential ability to personally occupy the
home on a permanent basis.

DEFERRED STUDENT LOANS

Payments on deferred student loans must be included in total debt ratio,
even if they are deferred for more than one year. Most lender will accept
a 1% payment of the outstanding balance in determining ratios.

UNDERWRITING ISSUES

Streamlined Documentation Requirements - Middle credit scores of 620
and above eliminate the need for lender documentation of credit
waivers for derogatory credit in accordance with RD AN 4441:
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http://www.rurdev.usda.gov/regs/an/an4441.pdf

The underwriter must issue a credit waiver to RD and supply all back up
documentation used in the decision making process for applicants with
derogatory credit issues and middle credit scores* of 619 or lower. The
lender must document that the instances of unacceptable credit were:

         1. Temporary in nature
         2. Beyond the applicant's control
         3. Have been removed or the result of a justifiable dispute
            relative to defective goods or services.

UNPAID COLLECTIONS
The lender (underwriter) is responsible for determining what collection
accounts, if any, should be paid in full by the borrower prior to or at loan
closing. Mitigating circumstances must be documented in the lender’s
file.  Some lenders have determined the medical collections over 12
months old do not have to be paid.

RATIO WAVIERS

The lender (underwriter) must submit a ratio waiver for RD concurrence
anytime either one or both ratios are above limit. The ratio waiver must be
accompanied by acceptable compensating factors


PAYMENT SHOCK

Measured by dividing the new PITI by previous housing expenses minus

      1. In cases where payment shock is 100% or higher, no additional risk
      layering should be allowed without strong compensating factors
      such as those listed under Debt Ratio Waivers

RISK LAYERSING

Refers to the existence of multiple levels of risk in an application such as
payment shock, adverse credit waivers, debt ratio waivers, employment
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history issues, property issues, temporary buy-downs, or middle credit
scores of 619 or lower. The lender should be very cautious when
evaluating applications with multiple risk levels.

MIDDLE CREDIT SCORE

Three scores = middle. Two scores = lowest. One score = that score.

The lender (underwriter) must submit a ratio waiver for RD concurrence
whenever the housing and/or debt ratios are above limit if the overall
evaluation of the application indicates that there are acceptable
compensating factors.

EXAMPLES OF COMMON COMPENSATING FACTORS

1. The borrower has demonstrated a conservative attitude toward the use
of credit and ability to accumulate savings.

2. Previous credit history shows that the borrower has the ability to devote
a greater portion of income to housing expenses (i.e.. The applicant has a
history over the previous 12 month period of devoting a similar
percentage of income to housing expense to that of the proposed loan,
or accumulating savings which, when added to the applicant's housing
expense, shows a capacity to make payments on the proposed loan).
3. The borrower receives compensation or income not reflected in
annual income, but directly affecting the ability to pay the mortgage,
including food stamps and other similar public benefits.
4. There is only a minimal increase in the borrower's housing expense.
5. The borrower has substantial cash reserves after closing.
6. The borrower has substantial non-taxable income not previously
accounted for in the ratio computations.
7. The borrower has potential for increased earnings, as indicated by job
training or education in the borrower's profession.
8. The home is being purchased as a result of, and/or relocation of, the
primary wage-earner and the secondary wage-earner has an established
history of employment, is expected to return to work, and there are
reasonable prospects for securing employment in a similar occupation in
the new area. The underwriter must address the availability of such
possible employment.
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9. A low TD ratio. A low TD ratio by itself does not compensate for a high
PITI ratio, however, when other strong compensating conditions are
present, a low TD ratio should be viewed as a positive mitigating factor.
10. A credit score of 660 or higher. The scores are known as Beacon,
Empirica and Fair Isaac scores. If the borrower's credit report contains two
scores, then the lower of the two should be used. If the credit report has
three scores, then the middle score should be used.

APPRAISAL

The condition of the dwelling may be documented by:

      1. FHA roster appraisers in the appropriate sections of the appraisal
      form.
      2. Non-FHA roster appraisers may also complete the appraisal form;
      however, in such cases a separate home inspection report
      prepared by a home inspector should be obtained.

         The lender may determine that a non-FHA roster appraiser is
         qualified to perform the home inspection, as long as the lender is
         assured that the non-FHA appraiser is thoroughly familiar with
         HUD Handbook 4905.1 and 4150.

APPRAISAL AGE

The appraisal must have been completed within 6 months of the date the
request for a conditional commitment is submitted to RD.

APPRRAISAL REPORT

The following appraisal forms are acceptable:
1. Uniform Residential Appraisal Report (URAR) (Freddie Mac Form
70/Fannie Mae Form 1004)
2. Manufactured Home Appraisal Report & Addendum (Fannie Mae Form
1004C/Freddie Mac Form 70B)
3. Individual Condominium Unit Appraisal Report (Fannie Mae Form
1073/Freddie Mac Form 465)


                                     99
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THE APPRAISER MUST COMPLETE THE FOLLOWING STEPS

1. Use the most recent revision of the appraisal form.
2. Perform both an interior and exterior inspection of the subject property.
3. Provide a description and analysis of the subject property,
neighborhood, site and improvements.
4. Complete a sales comparison analysis including at least three (3)
comparable properties sold within the last 12 months, providing specific
sales or financing concession information for the comparables.
5. Develop the cost approach to value only in cases in which it is:
       A. Requested by the lender.
       B. Considered by the appraiser to be a good indicator of value of
       the property.
6. Include an opinion of value for the site in all cases.
7. Attach a narrative explanation supporting unusual adjustments.
8. Include other comments, data, and exhibits if needed to describe the
subject property, document analysis and valuation or to support
appraiser’s conclusions.
9. Include clear, descriptive photographs of the front, rear and street
views of the subject property.
10. Include clear, descriptive photographs of the front view of each
comparable sale.
11. Provide an adequately supported estimate of value.

CONDOMINIUMS AND TOWNHOMES

Condominiums and Townhouses are eligible for financing under the Rural
Development Guaranteed Rural Housing Loan Program if they meet the
following requirements:

      1. The complex must be served by a homeowners association.
      2. The homeowners association must be under the control of the
      homeowners, not the developer.
      3. The homeowners association must take monthly deposits into an
      escrow account. The amount deposited into the escrow account
      must be sufficient to pay for regular maintenance, plus emergency
      repairs of common area responsibilities.
      3. A condominium must be approved or accepted by HUD, VA,
      Fannie Mae or Freddie Mac.
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NEW CONSTRUCTION

New Construction is defined as a dwelling to be built or a dwelling which is
less than 1 year old. The following must be provided to the lender when
submitting for RD:

      1. Certified Building Plans and Specifications. Plans and specs must
      be obtained by the Lender.
      2.The lender may use (optional) Form RD 1924-25, "Plan Certification"
      to certify that the dwelling was built in accordance with the
      International Residential Building Code, i.e. the Certificate of
      Occupancy or the Builder’s Permit.

      2. Evidence that the three required building inspections have been
      completed.

            Known as “Footing, Framing, & Final”, they include:
            a) When the foundation is in but prior to backfilling
            b) When the shell is closed but plumbing, electrical
            and mechanical systems are still exposed
            c) When construction is 100% complete.

      3. Building inspections must be completed by someone deemed
      qualified by the lender, such as a HUD approved fee inspector
      (appraisers do not meet this criteria).
      4. A Builder’s Warranty is issued which provides for at least a 1 year
      warranty from the date of completion.
      5. Only a final building inspection is required when the builder
      supplies an insured 10 year warranty.
      6. Certification regarding conformance with Rural Development
      Thermal Performance Standards. Newly constructed homes should
      meet the requirements of the International Residential Building
      Code. Form RD 1924-25, "Plan Certification", or Thermal Certification
      for New Construction, Exhibit C, may be used to certify Thermal
      Performance for new homes.




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HOMES WITH POOLS

RD does not allow the financing of pools. If you property has a pool the
appraiser must appraiser the property without consideration to the cost
market reaction. This normally will cause the sellers asking price and the
appraised value to be off by several thousands of dollars and in most
cases prevent the buyer and seller to come to acceptable terms other
than in the case where the seller is liquidating a foreclose property and
sufficient equity would exist between a fair market value with the pool
being considered and the agreed upon sales price..

RATES, TERMS, AND FEES

The interest rate must be fixed for the entire note. The rate may not
exceed the Lender's published rate for VA first mortgage loans with no
discount points or the current 90 day Fannie Mae rate plus 60 basis points
rounded up to the nearest one quarter of one percent.

TERMS OF REPAYMENT

The term of the loan must be for 30 years. Principal and interest shall be
due and payable monthly.


GUARANTEE FEE

The Lender will pay a one time non-refundable fee equal to 2% of the
loan. The fee is .5% of the loan amount for refinancing RD direct and
guaranteed loans. The guarantee covers 90% of the original loan amount.
The fee may be passed on to the borrower. There are no monthly
charges.

CHARGES AND FEES BY THE LENDER

The Lender may establish charges and fees for the loan provided they do
not exceed those charged other customers for similar transactions such as
FHA loans. Late payment fees may be assessed but these are not covered
by the guarantee. Late payment fees cannot exceed the maximum
amount prescribed by HUD, FNMA or FHLMC.
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ESCROWS

Escrow accounts must be established to insure the payment of real estate
taxes and homeowners insurance. Escrow accounts may be established
to insure the completion of exterior items which cannot be completed
due to weather.

CONDITIONS COMMITMENT MUST BE OBTAINED PRIOR TO CLOSING

After reviewing the conditions of the Conditional Commitment, the Lender
may proceed with the loan closing. Any revisions to the terms of the
Conditional Commitment must be approved by Rural Development and
Form RD 1980-18 must be revised.




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                       RD APPLICATION CHECKLIST

 (To be completed by the lender and submitted with the Request for
Guarantee) Please assure that all documents have consistent Names,
Interest Rate, and Loan Amount
1. Copy of RD Form 1980-86, Request for Reservation of Funds (Fax prior to
submission of package, or, submit to RD in the complete, underwritten,
loan package)
2. Fannie Mae Form 1008, “Uniform Underwriting and Transmittal Summary”
signed by the underwriter. Comments and pre-qualifying and final
requirements of underwriter must be attached.
3. Form 1980-21 “Request for SFH Loan Guarantee” (Rev 6-06 or newer)
(Form must be complete with signatures of applicant(s) and underwriting
lender)
4. Copy of signed and dated application
5. Copy of acceptable credit report on all applicants (not more than 120
days old)
6. Copy of valid income verifications of each adult member of the
household
7. Copy of sales contract or bid for construction contract
8. Complete acceptable appraisal, less than 6 months old
9. FEMA Form 81-93, Standard Flood Hazard Determination
10. Anticipated Loan Closing Date Lender must include written
documentation that each eligibility requirement is met and the basis
for those determinations must be included in the lender’s file.

BORROWER(S): __________________________________________
PROPERTY LOCATION: ___________________________________
                    ___________________________________




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                INSPECTION CERTIFICATION/EXISTING PROPERTIES

I have inspected the above property and have determined that the
dwelling is structurally sound, functionally adequate, in good repair, or will
be placed in good repair (see repair list below), and that the following are
adequate:
Plumbing_____ Electrical_____ Heating/Air_____ Foundation_____ Roof_____
Comment regarding site evaluation and list any site hazards, i.e. drainage
problems:______________________________________________________________
________________________________________________________________________
________________________________________________________________________
I Certify the dwelling meets current requirement of HUD Handbooks 4150.2
and 4905.1. Also, 100 % of the crawl space is accessible for repairs &
maintenance (18 inches from ground to floor joists). _____________________
OR
I certify that when the following repairs are done, the dwelling will meet
the current requirements of HUD Handbook
4150.2 and 4905.1/ (Re-inspections required upon completion.)
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________

If this property has a well, the separation distance between the well and a
septic tank, the drain field, and the property line should comply with HUD
guidelines (well must be located a minimum of 50 feet from a septic tank,
100 feet from the septic tank’s drain field and a minimum of 10 feet from
any property line) or state well codes. If public water/sewer is available,
connection must be made if cost is 3% or less of the estimated value of
the property. ______________________________________
I have no personal interest, present or prospective, in the property,
borrower(s), or proceeds of this mortgage.
Inspector's Name (Print) Date____________________________
Inspector’s Name (Print) Telephone Number_____________________________




                                     105
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider

            REINSPECTION AFTER COMPLETION OF REPAIRS

I have reinspected the dwelling and all repairs outlined above have been
completed properly.

_______________________________
Inspector's Signature Date

BORROWER(S):
PROPERTY ADDRESS:
PROPERTY COUNTY:

I have inspected the above property and certify the following:

Dwelling: The local jurisdiction has adopted ___________________ as their
Model Building Code. The insulation R-values comply with the thermal
performance standards identified in the Model Building Code adopted by
the local jurisdiction. The local jurisdiction has not adopted a Model
Building Code. The insulation R-values comply with the thermal
performance standards identified in the 2006 International Residential
Code. The required thermal standards can be determined by reviewing
Table 1 on the reverse to select the climate zone for the County where the
dwelling is located and then reviewing Table 2 to identifying the correct R-
values corresponding to the County’s specific climate zone.
Windows:
Double glazed (thermal pane)
Single glazed, with storm windows
Exterior Doors:
Insulated Solid-core, with a storm-type door
Vapor Barrier:
A moisture vapor barrier consisting of at least 6-mil thickness polyethylene
sheeting is properly installed throughout the crawl space.
Inspector’s Signature Date

Inspector’s Name (Please Print) Telephone Number, Inspector’s Address




                                     106
                    621 Doolittle Road, Woodbury, TN 37190
                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
      Brokers Best Contract Loan Processing
               A Premiere Contract Loan Processing Service Provider

                       THERMAL CERTIFICATION/New Construction

Table 1. Tennessee Counties and Climate Zones1
Table 2. Minimum Required Thermal Performance (R-Values)1,2
Notes
1 Excerpted from the 2006 International Residential Code
2 R-Values are minimums.
3 R-30 shall be deemed to satisfy the requirement for R-38 whenever the full height of
uncompressed R-30 insulation extends over the
wall top plate at all eaves.
4 The first R-Value applies to continuous insulation without stud cavities. The second R-
Value applies to insulation installed in framing
cavities (between studs). Either insulation meets the requirement.
County Zone
Anderson, 4 Fentress 4 Lauderdale 3 Roane 4 Bedford 4 Franklin 4 Lawrence 4 Robertson
4 Benton 4 Gibson 4 Lewis 4 Rutherford 4 Bledsoe 4
Giles 4 Lincoln 4 Scott 4 Blount 4 Grainger 4 Loudon 4 Sequatchie 4 Bradley 4 Greene 4
Macon 4 Sevier 4 Campbell 4 Grundy 4 Madison 3 Shelby 3 Cannon 4 Hamblen 4 Marion
4 Smith 4 Carroll 4 Hamilton 4 Marshall 4 Stewart 4 Carter 4 Hancock 4 Maury 4 Sullivan 4
Cheatham 4 Hardeman 3 McMinn 4 Sumner 4 Chester 3 Hardin 3 McNairy 3 Tipton 3
Claiborne 4 Hawkins 4 Meigs 4 Trousdale 4 Clay 4 Haywood 3 Monroe 4 Unicoi 4 Cocke 4
Henderson 3 Montgomery 4 Union 4 Coffee 4 Henry 4 Moore 4 Van Buren 4 Crockett 3
Hickman 4 Morgan 4 Warren 4 Cumberland 4 Houston 4 Obion 4 Washington 4 Davidson
4 Humphreys 4 Overton 4 Wayne 4 De Kalb 4 Jackson 4 Perry 4 Weakley 4 Decatur 4
Jefferson 4 Pickett 4 White 4 Dickson 4 Johnson 4 Polk 4 Williamson 4 Dyer 3 Knox 4
Putnam 4 Wilson 4 Fayette 3 Lake 3 Rhea 4

Climate Zone Ceilings Walls Floors Basement Walls 4, 5 Slab Edge R Value, Depth 6 Crawl
Space Walls 4, 73 R-30 R-13 R-19 0 0 R-5/R-13
4 R-383 R-13 R-19 R-10/R-13 R-10, 2 feet R-10/R-13

Basement walls, when the space is heated and/or air conditioned, must be insulated
from the top of the basement wall down to 10 feet below the outside grade or to the
basement floor, whichever is less.
6 An additional R-5 shall be added to the required Slab Edge R-Value for heated slabs.
7 The under-floor space between the bottom of the floor joists and the earth under any
building (except space occupied by a basement) shall be ventilated in accordance
with R408.1. Crawl space wall insulation or insulating the cells of concrete masonry units
as an alternative to floor insulation is only allowable in unvented crawl spaces, in
accordance withN1102.2.8. Unvented crawl spaces shall have an impermeable 6-mil
plastic vapor barrier installed with taped seams lapped at least 6-inches, and a
continuous mechanical exhaust ventilation of at least 1 cfm or they receive a supply of
conditioned air in accordance with R408.3.

                                        Exhibits

                                           107
                       621 Doolittle Road, Woodbury, TN 37190
                                 (615) 556 2103 Direct
                                  (615) 563-6771 Fax

                                        2/1/2010
        Brokers Best Contract Loan Processing
                A Premiere Contract Loan Processing Service Provider


                                     Initial Dispute Letter

To Whom It May Concern,

I was recently denied credit due to incorrect items listed on my credit report. I am
providing my full name, spouse's full name (if relevant), current address, previous
addresses going back five years, the date of my/our birth, social security number(s) and
phone numbers (home and work), and what account(s) is inaccurate. Please investigate
this incorrect information and remove them from my file immediately.

Thank you for your services in this matter.




                         Initial Dispute Letter on a Specific Account

To Whom It May Concern,

The following listed errors on my Credit Report are incorrect.

List errors:

e.g., This account number is not correct:

Name of Account__________________ Correct Acct. #:________________

My account with this Credit Union is in good standing although you indicate on your
report that I was late in my payments 30 days twice and 60 days once. I have never
been late in my payments to this account.

I shall expect your prompt attention to this matter in writing.




                                              108
                        621 Doolittle Road, Woodbury, TN 37190
                                  (615) 556 2103 Direct
                                   (615) 563-6771 Fax

                                            2/1/2010
       Brokers Best Contract Loan Processing
                A Premiere Contract Loan Processing Service Provider


                     Second Dispute Letter to Request Re-Investigation

To Whom It May Concern (or name if you have one)

I received your response regarding the item(s) I requested that you investigate on my
credit report. Your response claimed that you verified the items(s) as correct as
presented on the initial report. I am sure you did a thorough investigation, but I disagree
with the results of your investigation and want the inaccurate items removed from my
credit report.

I am requesting for the second time that you correct the problem on my report. It is
imperative that you re-investigate these incorrect items because they are still causing
serious and damaging impact on my current financial status. This is very important to me
and I will take whatever actions are necessary for my self-defense, including legal action
to recover my financial losses.

I am enclosing a copy of my original letter to you along with my credit report. Also, I am
aware that the Fair Credit Reporting Act allows me to request that you provide me with
the name(s) and business address(es) of those merchants with whom you verified this
information. I want to directly contact the person supplying you with incorrect
information that continues to appear on my Credit Report.

As I understand my legal position, you are liable for this error. If this issue is not corrected
immediately, I shall be forced to take stronger action against your organization.




                            Letter of Acknowledgment Requested

To Whom It May Concern,

A written investigation request was made to you concerning certain disputed items on
my Credit Report on (date of your first letter) Please see the enclosed copy of my letter
to you along with photocopy of returned postal receipt. As of this writing, I have not
received your reply as requested.

I have been made aware through legal counsel that, according to the Fair Credit
Reporting Act, you must respond to my request within a reasonable period of time as to
your findings.

Thank you for your help in resolving this matter expeditiously.




                                               109
                         621 Doolittle Road, Woodbury, TN 37190
                                   (615) 556 2103 Direct
                                    (615) 563-6771 Fax

                                            2/1/2010
       Brokers Best Contract Loan Processing
               A Premiere Contract Loan Processing Service Provider

                       Request for Deletion of Obsolete Information

To Whom It May Concern,

I am writing to you to request that you delete certain information from my current credit
report that has become obsolete.

I refer specifically to the information highlighted on the enclosed copy of my consumer
credit report. This information is obsolete and should be removed. Please look into this
matter and delete this information from my records on your credit files promptly upon
receipt of this communication.




                       Request to Add Information to Credit Report

To Whom It May Concern,

In reviewing a copy of my credit report from your agency, I discovered certain
important, relevant information that attests to my creditworthiness is missing. As such,
please add the following to your records for my credit file:

(List accounts with account #, name on the account, creditor name and address)

I have included a copy of my most recent credit report and have detailed the
information I would like to have added to it. Please note that I have included all relevant
account numbers as well as the complete names and addresses of all pertinent
creditors. In the event that you require any further information, please contact me
directly at the telephone number or mailing address provided below.

Please advise me of any fees that may be required to expedite your updating of my
record(s).




                                            110
                        621 Doolittle Road, Woodbury, TN 37190
                                  (615) 556 2103 Direct
                                   (615) 563-6771 Fax

                                         2/1/2010
       Brokers Best Contract Loan Processing
                A Premiere Contract Loan Processing Service Provider


                            Request Removal of Late Payment

To Whom It May Concern,
I have learned that several payments to my account have been marked as "late" on my
Credit Report. Please note that I have always been prompt in making my payments in
the past. I have only been late with one (number) of payments because (Give Details).
Because of the circumstances and my overall excellent record, I would like you to
contact the following Credit Bureaus and correct the records on my payment history.

Since this late payment was the result of the above excusable reason, please correct the
payment history for my account at the following Credit Bureaus, which handle your
organization's account histories:

(Provide Credit Bureau Names and Addresses)

It is imperative that my Credit Report exemplifies the good relations I have enjoyed with
your business in the past, and that the corrections in the report are more representative
of my good financial habits.

Thank you for your assistance in this matter.




                                            111
                        621 Doolittle Road, Woodbury, TN 37190
                                  (615) 556 2103 Direct
                                   (615) 563-6771 Fax

                                          2/1/2010
       Brokers Best Contract Loan Processing
               A Premiere Contract Loan Processing Service Provider


                                   Settlement of Account

THIS AGREEMENT is entered into on (date), between (your name), residing at (your
address, city, state and zip code) and (name of creditor), conducting business at:
(creditor address, city, state and zip code) Whereas, Debtor and Creditor have
previously been engaged in a certain commercial transaction, and

Whereas, certain circumstances subsequently developed which caused both Debtor
and Creditor to desire to enter in to this agreement.

Therefore, based upon the mutually agreed upon promises contained herein:

1. Debtor hereby agrees to pay, and Creditor agrees to accept, $ (amount) as a final
settlement for any and all amounts owed by Debtor to Creditor.

2. Creditor agrees to cease any and all attempts to collect this debt, either directly or
through a collection agency.

3. Creditor agrees to notify, in writing, each credit bureau with whom the creditor deals
that any adverse, derogatory, or otherwise negative information regarding Debtor's
account is, effective this date, retracted, and should be deleted from Debtor's consumer
file and report.

In Witness Whereof, the Debtor and Creditor have affixed their signatures to this
agreement as of the date shown above.

________________________________                      ________________________________
       Signature/Date                                       Signature/Date




                                            112
                        621 Doolittle Road, Woodbury, TN 37190
                                  (615) 556 2103 Direct
                                   (615) 563-6771 Fax

                                         2/1/2010
        Brokers Best Contract Loan Processing
                   A Premiere Contract Loan Processing Service Provider


                                         AUS Express Pre-Qualification

For a pre-qualification and credit analysis e-mail or fax this document to your Processing Center.

Applicant Name: __________________________________________________________________________________________

Home Phone:                Yrs at Address:              SS#:                    DOB:__________________________

Street: _____________________________________________________________________________________________________

City:_____________________________State:______________________________Zip:___________________________________

Employer:__________________________________________________________________________________________________

Years of Employment: ___________Income: ________________ Yr/M/W/Hr: ______Other Income: __________________

Co-Applicant Name: _______________________________________________________________________________________

Home Phone:                Yrs at Address:              SS#:                    DOB:__________________________

Street: _____________________________________________________________________________________________________

City: _____________________________State:______________________________Zip:___________________________________

Employer(s): _______________________________________________________________________________________________

Years of Employment: ___________Income: ________________ Yr/M/W/Hr: ______Other Income: __________________

Loan Amount Requested: ____________________________ Purchase Price/Value: ________________________________

Program and Rate Requested: ______________________________________________________________________________

SFD/Condo/Town Home:                                     Maintenance Fee: ___________________________________

LO Name: ___________________________Contact Phone Number:___________________ Fax: ______________________

E-mail Address:                                                                                        _________

I/We authorize ____________________________________________ access my/our credit report and use it to secure a
loan program I/we might qualify for in the hope of securing residential financing. Such information includes, but
not limited to, employment history; bank, money market, and similar account balances; credit history; and
copies of tax returns or W-2’s. I/We so agree that a copy of this facsimile authorization maybe accepted as an
original..

     ______________________________________________         ______________________________________________
            Applicant Signature and Date                           Co- Applicant Signature and Date




                                                      113
                             621 Doolittle Road, Woodbury, TN 37190
                                       (615) 556 2103 Direct
                                        (615) 563-6771 Fax

                                                   2/1/2010
        Brokers Best Contract Loan Processing
                   A Premiere Contract Loan Processing Service Provider


                           RESIDENTIAL LOAN PROFESSIONAL/PROCESSOR CHECKLIST
                                  For Conventional, FHA, VA, and USRD Loans
Within 24 hrs of a faxed receipt of this form or 1003, and any documents at application your file will be
submitted to AUS if applicable with a comprehensive review of the findings returned. You will also be provided
comments if applicable. For an up to the minute review please contact your Loan Processor or go to your
shared drive and locate your Excel Processing Worksheet which is updated daily to provide you with up to date
status of documents in or where your file stands for underwriting submission or closing. Please have your client
send all documents either faxed, e-mailed, or mailed to your attention to the processing center.


NAME: ________________________ ADDRESS: _____________________________________________

PHONE: ____________________ CURRENT LOAN #____________________________PURC or REFI

LOAN #:__________________________TITLE/ESCROW CONTRACT INFO:______________________

______________________________________________________________________________________

INVESTOR NAME AND LOCK EXPIRES: ___________________________________________________

CLOSING DATE:_______________________________________________________________________

BORROWER’S EMAIL: __________________________________________________________________

                                                    Loan Set up


D ( ) Application has been upload into processing software and a loan number provided.

F ( ) Residential Loan Professional has notified SLS of an new file by providing this form

                                                    Disclosures

H ( ) GFE TIL DISCLOSURES sent out. DATE SENT: ______________________________

H ( ) GFE TIL DISCLOSURES faxed/emailed copies back DATE: ________________

H ( ) SIGNED ORIGINAL STANDARD DISCLOSURES RETURNED DATE:___________

I ( ) FHA/VA Disclosures sent out. DATE SENT: ______________________________

I ( ) FHA/VA Disclosures faxed/emailed copies back. Date:_________________

J ( ) FHA Copy of current Note, ‘DOT, and HUD1 secured:____________________

J ( ) SIGNED FHA DISCLOSURES RETURNED. DATE::___________________________

J ( ) RD Form 1980-21 Sent:__________________________________________________

J ( ) RD Form 1980-21 Signed and RETRURNED:_______________________________
Notes:
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
                                                 Page One

(K) Income


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                                        (615) 556 2103 Direct
                                         (615) 563-6771 Fax

                                                    2/1/2010
         Brokers Best Contract Loan Processing
                     A Premiere Contract Loan Processing Service Provider

( ) Self-employed: Provide most recent TWO years COMPLETE (all pages) tax returns with all schedules.

( ) Most recent TWO years W-2’s for each employed borrower (and from all employers).

( ) Most recent TWO years 1099’s for each applicable borrower, and TWO years COMPLETE (all pages) tax
returns with all schedules.

( ) Source of Income includes Retirement, Pension or Social Security Benefits please provide evidence of
receipt in the form of copies of checks or 2 months most recent Bank statements showing Direct Deposit. If Soc
Sec, also provide the “Awards Letter.”


( ) If your client’s source of income includes Alimony or Child Support please provide evidence of receipt in
the form of copies of checks received and Divorce Decree or Support Order.

( ) Most recent Pay stubs covering 30 day period for each employed borrower.

( ) Rental Income: Self-employed will need ONE or TWO years complete tax returns with Schedule E. If
property was not leased in the prior year provide a copy of the current license agreement.

( ) Copy of Social Sec. Card AND Drivers License, please ENLARGE drivers license.
If ID is out-of-state, a 2nd form of ID (Birth Cert, Auto Registration, Current Pay Stub, Utility Bill with SAME address
as on ID) is required for Patriot Act Disclosure.

( ) IF APPLICABLE: Copy of Green Card or Work Permit.

Note: ______________________________________________________________________________________________________
____________________________________________________________________________________________________________

                                                        Assets (L)

( ) Most recent TWO months complete Bank Statements for any and all accounts with ALL pages included.

( ) Most recent statements for Retirement Accts, 401K, Mutual Funds, Stocks, etc. (Two Months)

Note: ______________________________________________________________________________________________________
____________________________________________________________________________________________________________
                                                   Credit

C ( ) AUS: Reviewed completed and provided to the Residential Loan Professional.

M ( ) If your client is Renting, supply the Name, Address and Phone Number of their Landlord, OR supply 12
months cancelled rent checks.

M ( ) No Credit History Borrowers: Should you’re borrowers have no credit, supply copies of your most recent
12 MONTHS of utility bills (phone, electricity, cable, etc.).

M ( ) Bankruptcy/Consumer Credit Consulting: Copy of complete Discharged Bankruptcy Documents or a
Letter from the Consulting Service with date of completion.


                                                        Page Two




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                                         (615) 556 2103 Direct
                                          (615) 563-6771 Fax

                                                       2/1/2010
        Brokers Best Contract Loan Processing
                   A Premiere Contract Loan Processing Service Provider


M ( ) Being A Co-Signer: If you co-signed for a mortgage, car, credit card, etc. supply 12 months cancelled
checks, front and back, indicating that someone else is making payment.

M ( ) Most recent Billing Statements with account numbers for any accounts being paid off with this new
Mortgage Loan.

M ( ) Copy of Most Current Mortgage Statement showing account number.

N ( ) CAVIRS, LDP and GSA Cleared: Date: ________________

O ( ) LOE provided by borrowers on credit issues.

Notes: _____________________________________________________________________________________________________
____________________________________________________________________________________________________________

                                                     Property

P   ( ) Appraisal Ordered From: ________________________________Date:____________
                             Rec’d:_________ AMT:___________

Q ( ) IF PURCHASE or REFI: GET HAZARD INSURANCE BINDER Or a copy of current Hazard AND Hurricane
Insurance Policy w/policy number, premium, agent name, phone and fax number. Hazard/Hurricane
premiums separated.

Q   ( ) New Insurance w/Mortgagee Clause: Date: _____ Rec’d _____

R   ( ) Appraiser License is current.

S   ( ) Borrower has been sent a copy of the appraisal.

T ( ) FHA Case Number with Sponsor ID Number and Netting Authorization:
Date: _________

U ( ) Valuations Sheet Has been reviewed and all parties have been noticed of any conditions that need to
be completed.

V/W( ) HOA Certification: Name and Phone # of Mgmt Co: __________________________

X ( ) Title Prelim w/Supp, Wiring Instructions and Escrow Instructions:                         Date:
__________Rec’d:___________

Y   ( ) Payoff demand requested from Escrow: Date: _________ Rec’d ________________

Z   ( ) Subordination Agreement: Ordered: ______________ Rec’d ___________________

AC ( ) Rate Lock Requested: ______ Confirmation Date: ___________

AD ( ) Purchase Agreement Date:________ (If this is an FHA loan insure Notice to Homebuyer is DATED THE
SAME DATE of your Purchase Agreement.

AE ( ) FHA/VA All parties to the contract have signed the Amendatory Clause
Notes: ___________________________________________________________________
___________________________________________________________________________________________________________

                                                    Page Three



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                                                    2/1/2010
        Brokers Best Contract Loan Processing
                   A Premiere Contract Loan Processing Service Provider


                                                  Submission

AG ( ) INVESTOR PACKAGE SENT. DATE: ______________ Status Date: _____________

AG ( ) Blanket Certification

AK ( ) SIGNING SCHEDULED:_____________

AK ( ) Fee sheet has been completed by Residential Loan Professional, and reviewed for accuracy with
Escrows Closing Instructions.

AK ( ) DOC REQUEST SENT DATE: ________________

AL ( ) DOC’S REC’D: _____________

AM ( ) FINAL1003 and all PTF conditions sent to Escrow and/or the investor.
Date: _________

AO ( ) LOAN FUNDING DATE:___________________________

Notes: _____________________________________________________________________________________________________
____________________________________________________________________________________________________________

                                              (AP) Administrative

( ) Completed Processing Software and provided Client with Hard and/or Electronic Copy File.

Notes: _____________________________________________________________________________________________________
____________________________________________________________________________________________________________

Residential Loan Professional Contact Information: Phone: ________________________________
                                    Cell: ________________________________
                                     Fax: ________________________________

                                           (AT) PROCESSOR NOTES
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________
____________________________________________________________________________________________________________

Thank you for choosing to BBCLP for your processing needs.



Wes McKibbon
Loan Processor
Middle Tennessee Processing Solutions
                                                  Page Four




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                                                  2/1/2010
        Brokers Best Contract Loan Processing
                   A Premiere Contract Loan Processing Service Provider



                                              BBCLP Processing Evaluation

Affiliate Name________________________________________

Customer Name______________________________________

Questions:                                                                  Yes   No

Was the initial response time completed in a timely manner?

Was information provided to you in a concise and accurate manner?

Was the transaction approved in a timely manner?

Were you aware of the status of the transaction at all times?

Was our staff accessible for clarifications and communications?

Was the customer satisfied with the transaction?

Did the transaction require too much of your time?


Comments_______________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________




                                                      118
                             621 Doolittle Road, Woodbury, TN 37190
                                       (615) 556 2103 Direct
                                        (615) 563-6771 Fax

                                                   2/1/2010
     Brokers Best Contract Loan Processing
             A Premiere Contract Loan Processing Service Provider


                               Getting Started

Please complete the following information.

Company/Broker Information (Main Office or Parent Company)
Business Name: __________________________________
DBA: ____________________________________________
Street Address: __________________________________
City, State, Zip: __________________________________
Phone Number: _____________ Fax No: ____________
Email Address: ___________________________________
LO Names, Email Addresses, Work and Cell Phone Numbers:
             ______________________________________
             ______________________________________
             ______________________________________
             ______________________________________
             ______________________________________
             ______________________________________
             ______________________________________
             ______________________________________
             ______________________________________
             ______________________________________
Bookkeeper: ____________________________________
Receptionist: ____________________________________
Yrs In Business: ___________________________________
Primary Lender Contract: ________________________
Phone Number: _________________________________
Type of Business: Broker or Lender
Bus. Legal Status: Sole Proprietor, Partnership, Corporation, LLC; LLP; LP; LTD




                                     119
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                              (615) 556 2103 Direct
                               (615) 563-6771 Fax

                                   2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider



                       Corporate Filing Information

Date Incorporated: ______________________________ State: _______________
Federal Tax ID No: ______________If no Fed ID No. SSAN ___________________

                            License/Approval

Broker name license was issues to: ______________________________________
License #: ______________ Date Issued: ______________ Expires: ____________
Home Address of Broker: _______________________________________________
Phone #: ___________________________ Email:_____________________________
If licensed or approved by any of the following entities, the following
information is required.

Fannie Mae # _____________________________________Date: ______________
Freddie Mac # ____________________________________Date: ______________
FHA/HUD # ________________________________________Date: ______________
FHA Connection Password and Login: ___________________________________
Veterans Admin # _________________________________Date: ______________

                                Principals

Name: ______________________________________Phone #: _________________
Title: ___________________________Percentage Owned: __________________
Name: ______________________________________Phone #: _________________
Title: ___________________________Percentage Owned: __________________
Name: ______________________________________Phone #: _________________
Title: ___________________________Percentage Owned: __________________
Name: ______________________________________Phone #: _________________
Title: ___________________________Percentage Owned: __________________

Appraisers
1. Company Names: ________________________
Individual Appraiser: ________________________
Email address: ______________________________
Phone Number: _____________________________


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                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

2. Company Names: ________________________
Individual Appraiser: ________________________
Email address: ______________________________
Phone Number: _____________________________
 3. Company Names: ________________________
Individual Appraiser:_________________________
Email address: ______________________________
Phone Number: _____________________________
4. Company Names: ________________________
Individual Aprrasier: _________________________
Email address: ______________________________
Phone Number: _____________________________
5. Company Names: ________________________
Individual Appraiser: _________________________
Email address: ______________________________
Phone Number: _____________________________

Title/Escrow Agents
1. Company Names: ___________________________
Individual Agent: ______________________________
Email address: _________________________________
Phone Number: ________________________________
2. Company Names: ___________________________
Individual Agent: _______________________________
Email address: _________________________________
Phone Number: ________________________________
3. Company Names: ___________________________
Individual Agent: _______________________________
Email address: _________________________________
Phone Number: ________________________________

Service Providers Account Information
Condo Certs User ID: ____________________Password: ____________________
The Work Number for Everyone User ID: ___________Password: ____________
National Courier: ______________________ Acct #: _______________________
Local Courier: _________________________ Acct #: _______________________


Credit Agency: ________________________ Acct #: _______________________
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                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
     Brokers Best Contract Loan Processing
            A Premiere Contract Loan Processing Service Provider

Other: _________________________________ Acct #: _______________________
Other: _________________________________ Acct #: _______________________
Other: _________________________________ Acct #: _______________________
Other: _________________________________ Acct #: _______________________
Other: _________________________________ Acct #: _______________________
Other: _________________________________ Acct #: _______________________

                                 Investors

___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________
___________________________________LOGIN/Password: ___________________
Web Address: _________________________________________________________




                                    122
                   621 Doolittle Road, Woodbury, TN 37190
                             (615) 556 2103 Direct
                              (615) 563-6771 Fax

                                  2/1/2010
        Brokers Best Contract Loan Processing
                   A Premiere Contract Loan Processing Service Provider


                                    FHA Spot Approval Certification

Regarding the condominium project know as
________________________________________________________________________

located at _______________________________________________________________,

I certify the following:

The condominium project is complete; there is no ongoing or anticipated addition of any units,
common elements, and/or facilities.
Control of the common areas was turned over to the unit owners on _________.
We have attached evidence that the project has appropriate hazard, liability and flood insurance.
At least 90% of the units in the project are sold – total number of units ______
                                                        number sold/closed ______
                                                       number under contract _____
At least 51% of the units in the project are owner occupied –
                                                   number owner occupied ______
                                                   number investment          ______

No single entity owns more than 10% of the units in the project. “Entity” includes an individual
partnership, corporation, limited liability company, limited liability partnership, joint venture, investor
group or other natural legal person qualified to hold an interest in real property.
For condominium projects with more than 30 units, no more than 10% of the units have FHA loans at
this time; for projects with less than 30 units, no more than 20% have FHA loans at this time. We
have attached copies of the Deeds of Trust on all the units in the project to verify this information.


I hereby certify that the individual units located in this project are owned in fee simple and the
legal documents provide for undivided ownership of the common areas by the unit owners. By
virtue of this ownership, the unit owners have the right to use all facilities and unrestricted common
elements.

I also certify the project’s documents do not place any legal restrictions on conveyance. There
are no provisions that seek to limit free transferability of title including rights of first refusal and
restrictive covenants.

Certified by: __________________________________________________________
             Name, Title, Contact Information, and Date
             Attachments: CC&R
                           Bylaws




                                                   123
                            621 Doolittle Road, Woodbury, TN 37190
                                      (615) 556 2103 Direct
                                       (615) 563-6771 Fax

                                                2/1/2010

				
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