Contract Release & Earnest Money Disposition Request FormPlease cffiaillhis completed ronn along with the supporting documentation li!,IPrJ helow to' contractcancelsacrti'nemco-limitcd.com

Reason for Cancellation Supporting Documentation (~IUST be submitted with this form)

Lender funding cause of cancellation Lender denial letter.

All other reasons for cancellationLetter requesting cancellation signed by buyer(s) and broker stating reason(s) for

(Unsatisfactory home inspection. tcnnitecancellation. All parties MUST sign the letter. Letter MUST include property address.One IClter or separate letters arc acceptable. MUST include supporting documentation:

inspection. LBP inspection. Death of copy of home inspection; lennite repOrl: lead based paint report; estimate for repairs;immcdiate family member. etc.) copy of death certificate (obituary notice), etc,

Purchaser type: D Owner Occupant o Investor o Non-profit or Govemment Agency

Notice is hereby given by the Purchaser(s), _

that closing will not occur on a certain real estate sales contract between the Purchaser(s) and PE:\tCO, LTD., as the Prime Contractor

for the U.S. DCJlOlrtmcnt of lIousin~ and Urban Dc\'Clopmcnt as thc Seller.

The Contract limn is the IIUD.9548, more particularly described as:

FHA Case Number: _ Property Address: _

The Purchascr(s) and the Sellcr do not intend to consummate the Contract described above, and hereby agree mutually 10 relcase each other from

any and all obligations, liabilities and claims arising from the execution of the Contract.

The Purchaser(s) and the Selling Broker hereby release any and all of their rights, title and intercsLs in and to the subject property, and agree toaccept and follow the Earnest Money Disposition required in accordance with HUD guidelines. set forth in the "Forfeiture of Eamest Money

Addendum," and as directed in this document.

The Purchascr(s) hereby requcst the return of the eamest money deposit in the amount ofS and has provided suitable supporting

documentation with this request as to the reason.

Purchaser: _

Selling Broker: _

Selling Broker Email: _

Purchaser: _

Date: _

To BeCompleted by l'E~lCO, LTD.The Prime Contractor for the U.S. Department ofllousing and Urban Denlopment

As the Closing Agent or as the agency responsible for holding the earnest money deposit for this transaction, )'oU are hereby instructed toimmediately:

D Retum 100% of the eamest money deposit to the purchaser(s).

D Relum 50% of the eamest money deposit to the purchaser(s) and remit 50% to the U,S. Department of Housing and UrbanDevelopment (HUD) c/o PEMCO. LTD.

o Remit 100% of the eamest money deposit to the U.S. Dcpartment of Housing and Urban Development (HUD) c/o PEMCO, LTD.

Commenls: _

PEMCO, LTD. Representalive / Date Tille

Directions: If you have been instructed to remit earnest money to the U.S. Department of Housing and Urban Development, please make

checks or money order payable to JlUD and mail to:PEMCO. LTD.

1601 Response Road, Suite 260Sacramento, CA 95815

Cancellation Code .. _

lS-ColllracIReleasc-OS10 II

FORFEITURE AND EXTENSION POLICY(REV 3/9/13)

HUO Case Number: _

Property Address: ' , County Not Selected, State Not Selected,

With the exception of properties being purchased with 203(k) financing, all HUD Property Disposition sales of HUD-acquiredproperties are to close within 45 days of acceptance of a HUD-9548 (1/99) Sales Contract offer to purchase. Purchases involving203(k) financing are to close within 60 days of acceptance of a HUD-9548 (1/99) Sales Contract offer to purchase.

Forleiture of Earnest Money Depositsl CancellationsThe failure by a Purchaser to close on the sale of a property within the allowable time period, including any extensions granted byHUD, will result in the forfeiture of the earnest money deposit, except where the Purchaser presents documentation to HUD thatone of the special circumstances outlined in the section below has occurred and all supporting documentation is provided in atimely manner.

Investor Purchasers: < lNmA~HfRfJ-------(Buyer's Initials)

1. Uninsured Financed Sales. Forfeit 100 percent of the deposit for failure to close, regardless of the reason.

2. Insured Financed Sales. Forfeit 50 percent of the deposit for failure to close if purchaser is determined byHUD or DE underwriter to be an unacceptable buyer. Forfeit 100 percent if sale fails to close for any otherreason.

Owner-Occupant Purchasers:

1. Return 100 percent of the deposit where:

a. There has been a death in the immediate family (contract holder, spouse, or children living in the samehousehold);

b. There has been a recent serious illness in the immediate family that has resulted in significant medicalexpenses or substantial loss of income, thus adversely affecting the Purchaser's financial ability to closethe sale;

c. There has been a toss of job by one of the primary breadwinners, or substantial loss of income throughno fault of the Purchaser;

d. On an insured sale, HUD (or a Direct Endorsement Underwriter) determines that the Purchaser is not anacceptable borrower;

e. On an uninsured sale, the purchaser was pre-approved for mortgage financing in an appropriate amountby a recognized mortgage lender and despite good faith efforts, is unable to obtain mortgage financing.Pre-approved-means a commitment has been obtained from a recognized mortgage lender for mortgagefinancing in a specific dollar amount sufficient to purchase the property.

f. For other good cause, as determined and approved by HUD.

On an uninsured sale, forfeit 50 percent of the deposit in those instances where, despite good faith efforts by the purchaser, thereis an inability to obtain a mortgage loan from a recognized mortgage lender.

Vacant lot Sales:The purchaser will be considered as an investor and the instructions pertaining to forfeiture by investors will apply.

On any type of sale, the Purchaser will forfeit 100 percent of the deposit in those Instances where no documentation issubmitted, where documentation fails to provide an acceptable cause for the buyer's failure to close, or wheredocumentation is not provided within 15 days of contract cancellation.

Page 1 of 3F&E030913

FORFEITURE AND EXTENSION POLICY(REV 3/9/13)

HUD Case Number _

Requests for contract extensions (please note the specific instructions for HUO Designated and Buyer Select Programs):PEMCO, ltd. will review extensions of time upon receipt of written request. Extensions of time to close the sale are entirely withinPEMCO/HUD's discretion. An extension, jf granted, will be under the following conditions:

1. A written request for an extension must be received no later than five days prior to the expiration of contract.8. HUD Designated Closing Agent Areas - All documentation outlined below must be submitted directly to

lhe HUD Closing Agent. They will forward to PEMCO for review. Once approved or denied, PEMCO willnolify the designated closing agent, Listing Broker and Selling Broker of PEMCO/HUD's decision.

b. Buyer Select Closing Agent Areas - All documentation must be submitted directly to PEMCO.c. Requests for free extensions may be submitted via email to our office under specific circumstances:

Owner occupant experiencing delays with financing are entitled to one free extension (in the case of 203kloans, PEMCO will grant two extensions in 15 day increments). Delays attributed to a seller delay (assetmanager clearing title issue, HOA resolution, Utility or other concerns related to a delay due to a HUDcontractor) will receive a free extension. All other requests must be mailed to the appropriate address:

Atlanta HOC region:7000 Central Parkway, Suile 800Allanta, GA 30328Request for free:extensions@pemco-limlted com

Denver and Santa Ana HOC:4500 Cherry Creek South Drive, Suile 410,Glendale, CO 80246Request with fee waived email to:extendden@pemco-limlted.com

2. The documentation submitted with the request must establish the cause of delay and verification ofunderwriting approval and loan status. All lender letters must contain the signature of the loan officer or

underwriter.3. Extension fees are only granted in increments of 15 days. The cost of the extension, when charged, is based

on the contract sales price and submitted at the time of request (unless it meets the qualifications as outlinedabove). Fees for extensions are as follows:

Contract Sales Price Extension Fee

$25,000 or less $150 ($10 per day)

$25,001 to $50,000 $225 ($15 per day)

$50,001 or more $375 ($25 per day)

4. Extension fees shall be retained by Seller if a closing does not occur.5. At time of closing, unused extension fees will be prorated to the Purchaser and refunded by escrow.6. The granting of one extension shall not obligate the SeHer to grant additional extensions and the Seller shall

declare a Default for the Purchaser's failure to close the sale upon the expiration of the original closing periodor upon expiration of the extension.

Closing Cost automatically paid by HUD:1. Proration of property taxes and any special assessments, such as HOA fees and utility bills, when accrued

during HUD's ownership or in compliance with the state laws2. Condominium or HOA Transfer fees (from HUD to buyer only), if applicable3. Costs to provide condominium documents to Purchaser, if applicable4. Administration fee of $200 to administer the repair escrow (applies to only FHA 203b repair escrow loans)5. Recording Fees for the deed at closing

Commission:A sales commission of up to three (3) percent of the gross purchase price will be paid by HUD to the Selling Broker, if indicated on

Line 6a of form HUD-9548.

Closing Costs:If indicated on line 5 of the HUD.S548, closing costs that are considered to be reasonable and customary in the jurisdiction wherethe property is located will be paid by HUD. In no event may these costs exceed 3% of the contract's gross purchase price. Please

reference the most recent HUD Notices for additional information.

Page 2 of 3f&E030913

FORFEITURE AND EXTENSION POLICY(REV 3/9/13)

Hue Case Number _

Buyer'sInitials

Buyer'sInitials

Buyer'sInitials

Buyer'sInitials

Buyer'sInitials

Buyer'sInitials

Seller DisclosureSeller makes no representations or warranties concerning the condition of the property, including but not limited tomechanical system, dry basement, foundation, structural, or compliance with code, zoning or building requirementsand will make no repairs to the property after execution of this contract. Purchaser understands that regardless ofwhether the property is being financed with an FHA-insured mortgage, Seller does not guarantee or warrant that theproperty is free of visible or hidden structural defects, termite damage, lead-based paint, mold, or any other conditionthat may render the property uninhabitable or otherwise unusable. Purchaser acknowledges responsibility for takingsuch action as it believes necessary to satisfy itself that the property is in a condition acceptable to it, of laws,regulations and ordinances affecting the property and agrees to accept the property in the condition existing on thedate of this contract. Seller disclosure concerning HOA dues, Mello Roos taxes, assessments, or any tax concerningHUD homes is based on available information but not deemed complete or accurate. It is the responsibility of theBuyer to obtain all information concerning these issues.

15.DAY CONTRACT CANCELLATION CONTINGENCY FOR CONTRACTS OWNER OCCUPANTOwner Occupant Purchaser(s) may request that the Sales Contract be canceled if, within 15 days of HUD'sacceptance, the property is inspected by a professional home inspector, who discovers a structural, roof, systemdefect, or non.compliance with local codes, zoning, or building requirements that were not previously disclosed andHUO elects not to correct, or if within such 15 day period, the property is inspected for the presence of radon by aprofessional radon inspector to an extent unsatisfactory to the Buyer. Kitchen appliances, window air conditionerunits, light fixtures, receptacles and switch covers are not included in the operating systems. The earnest moneydeposit will be returned to the owner occupant purchasers ONLY jf HUD concurs with the home inspection reportfinding(s).

If the buyer chooses to cancel the sales contract due to the inspection or other test report, the buyer mustsubmit the cancellation within 15 days of HUD's acceptance; unless otherwise granted.

Walk-Thru InspectionAll Purchasers are strongly encouraged to perform a walk-through inspection PRIOR to the close of escrow. If aPurchaser discovers a property condition that did not exist at the time of sale they must immediately notify HUD'sAsset Manager, PEMCO, ltd. of the damage. Reporting of the damage does not guarantee the correction of theproblem that has been discovered. Each case will be looked at and a determination will be made as to whether thedamage will be repaired or proper credits given at the close of escrow, if those repairs or credits are deemed in thebest interest of the Dept. of HUD. The buyer assumes full responsibility for the property and its condition on the dateof close of escrow. The Department assumes NO responsibility and will make no settlement for damages reported toHUD after the close of escrow, (See item # 13.E of HUD Sales Contract).

Buyer CertificationI/we certify that l/we have read all three pages of this addendum and have been interviewed, completed a loanapplication, verification of employment's and obtained a full credit report from the lender that has provided theattached Letter of Commitment. l/we understand that I/we witt forfeit our earnest money deposit if we enter into thiscontract without completing this qualification process.

Change of FinancingIf financing is changed from FHA to conventional or cash, the buyer acknowledges he/she will be responsible forreimbursing the cost of completed termite and Lead Based Paint inspections, repairs and clearances. if applicable.

Letter of CommitmentI/we understand that I/we wilt forfeit our earnest money deposit if we enter into this contract without completing thequalification process.

Purchaser (signature)

SIGNHEM

Date Purchaser (signature)< ••...>¥iI

Date

< ""N'H\¥l------------------ ----Seiling Broker (signature) Date

Page 3 of 3F&E030913