green river capital - morn - 201310

8/11/2019 Green River Capital - MORN - 201310

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2013 Morningstar Credit Ratings, LLC. All Rights Rese

Operational RiskGreen River Capital, L

October 2013

OperationalClassifications: Resi

Resi

Assigned Rankings! ResiResi

Forecast: %avo

Analyst! Ri$h

Rationale

Morningstar Assigns Green River Capita

Asset Manage'ent) MR R "#Favora$

Morningstar Credit Ratings, LLC (Morningstarservi$er (short sales and assigns its *MOR Vranings. -he assigned ranings rele$t o/r ares"e$tive d/ties as a residential $om"onentasset manager ranings rele$t a "ervasive aregimen, $om"rehensive and $lientdriven "ote$hnolog and overall sstems inrastr/$t/ro""ort/nities and la/n$h ne "rod/$ts /i$l"rovide )RC, &oth as a $om"onent servi$er a&/siness vent/res s/$h as $ollateral /nderr

se$/riti5ation maret. 6n 7an/ar, 2012, )RCanalti$s "rovider to the residential and $om$an &e leveraged a$ross the to $om"anies"osition.

6n "arti$/lar, Morningstar+s assessment and

Com"onent #ervi$er and REO Asset Manage

E..e$tive -raining 9rograms O/r "&eneits rom a &lend o internal an

rved.

AssessmentC

ential Vendor (REO Asset Management

ential Com"onent #ervi$er (#hort #ales, Loss Mitigation an

ential Vendor! MOR RV2ential Com"onent #ervi$er! MOR R#2

ra&le :oth Ranings

rd '. o$h, ri$hard.o$h;morningstar.$om,


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Operational Risk Assessment: Green River Ca

2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e 2

Colle$tion 9ra$ti$es A$t (%@C9A ,$om"an in$or"orates e4ternal advCons/mer %inan$ial 9rote$tion :/r$onsisting o re/ired and o"tionalenter"rise in 201=. 'e &elieve thaits organi5ation.

Com"rehensive 9oli$ies and 9ro$e

$lientdriven "ro$esses that ma4imagreements. 'eel &est "ra$ti$ethe &/siness "latorm. Morningstara shared drive to a $om"an intran

Ro&/st -e$hnolog1 EnvironmentBthat s/""orts )RC+s "rod/$ts and"rovides the $om"an ith the ne

Additionall, )RC+s te$hnolog inrdelivering "erorman$e to $lients aand "rioriti5ing te$hnolog "roe$ts/tili5ing s/&e$t matter e4"erts rotraining. #stem enhan$ements ar

@isaster Re$over1 and :/siness C

in "la$e. )RC has migrated over tinrastr/$t/re and te$hnolog and in$l/ding the im"lementation o a glo$ation &e$ome red/ndant data o

Ris Management O/r vie is thaso/nd internal $ontrols. -hese $on$ontin/o/s "erorman$e monitorin

##AEDo.1


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a$le f Contents (Hyperlinks)

Co'pany -rofile and ./siness vervie

perational 1nfrastr/ct/re+++++++++++++++++++ ++++

Organi5ational #tr/$t/reManagement and #ta E4"erien$eManagement and #ta -/rnover

Assessment!-raining

AssessmentA/dit, Com"lian$e, and 9ro$ed/ral Com"le

Assessment

Legal Lia&ilit and Cor"orate 6ns/ran$eAssessment#stems Ar$hite$t/re, 9roe$t Manageme

Assessment

-erfor'ance Manage'ent: !endor -erf

Loan :oarding and 9reListingAssessment

-itle, 8OA and Real Estate -a4 Administrati Assessment

REO Asset ManagementAssessment

-erfor'ance Manage'ent: Co'ponentLoss Mitigation #ervi$es: Asset :oarding a

AssessmentLoss Mitigation #ervi$es! 8omeoner Co/

AssessmentLoss Mitigation #ervi$es! #hort #ale 9ro$e

Assessment#ingle %amil Rental 9ro"ert Val/ation and

AssessmentA$$o/nting and 6nvoi$e Management

Assessment

Ranking 2efinitions33333333

2isclos/res33333333333

1nde4 of C*arts (*yperlinks)

%ig/re 1! Cor"orate -imeline%ig/re 2 (O"erational #tr/$t/re%ig/re 3! REO Asset -imeline%ig/re =! Closing @e"artment 9ro$ess%ig/re >! #hort #ale 9ro$essing -imeline%ig/re


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2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e =

%ig/re 1! Cor"orate -imeline

Co'pany -rofile and ./siness vervie

)reen River Ca"ital LLC is a holl oned s/o/nded in 2003 to meet the /ni/e re/ire

o/nding in 2003, )RC has develo"ed a $lien%inan$ial, LLC (F)R%G as la/n$hed and serv$o/nseling and short sale and deedinlie/ oa de&t $olle$tor. 6n 200?, )RC $reated a divio/tside o val/ations, a $om"onent servi$esdiligen$e or, in$l/ding an REO and D9L iles/&sidiar o Claton. Claton is a leading "r$ommer$ial mortgage ind/stries. Claton is=,000 REO asse es as a sister $om"an to )RC, oering a loss mitigation "r

ore$los/re negotiation and li/idation. )R% is li$ensed in >sion that s"e$iali5es in "ro"ert val/ations. 6n order to meee"artment as develo"ed that "rovides traditional val/atiorevie de"artment. 6n 7an/ar 2012, )RC as a$/ired &vider o d/e diligen$e, s/rveillan$e and dea/lt administratioead/artered in #helton, C-, ith oi$es in )eorgia, Colora

rrentl has a""ro4imatel 1I.>00 REO assets /nder manage#E+s, &an and non&an loan servi$ers, "ension /nds andrtolio o a""ro4imatel >,000 assets /nder management anas 10 $lients re"resenting &an and non&an servi$ers andat are leveraged ithin the organi5ation. )RC $/rrentl em"l

08

nancialated

2009

GRC valuation

Division Created

GRC AClato

00 2!!"1##$

in 'est Valle Cit, Htah, )RC astial ho/sing ind/str. #in$e its+

ts d/ring that times"an. 6n 200I, )Rgram that "rovides homeoner#tates and the @istri$t o Col/m&ia asind/str demands or other servi$esor in addition to real estate d/eClaton maing )RC a hollonedn servi$es to the residential ando, and %lorida and has a""ro4imatel

ment $onsisting o 1I $lients that$redit /nions.d is a li$ensed de&t $olle$tor in all >0ension /nds. -here are 1> dedi$ated

los 1


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2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e >

%ig/re 2 (O"erational #tr/$t/re

perational 1nfrastr/ct/re and Risk Man

(MR R"#MR R!")

rganiational tr/ct/re)RC has 12< "eo"le allo$ated to REO asset

)RC $ond/$ts its REO asset management an

REO Asset Management -he REOassets. )RC "rovides $lients end t"lans or ea$h asset. )RC managere$on$iled maret val/es and "redLoss mitigation servi$es in$l/de hointervies at a &orroer+s residensale and deedinlie/ o ore$los/re

ACCOUNTING

ACCOUNTS PAYABLE

ACCOUNTS RECEIVABLE

BILLING

COORDINATORS

INVESTOR

REPORTING

GENERAL LEDGER

MANAGEMENT

HUMARESOUR

pital LLC| October 2013 | ratingagency.morningstar.com |

rved.

age'ent

anagement and $om"onent servi$es.

d $om"onent servi$es a$tivities mainl thro/gh to de"art

management team s"e$iali5es in val/ing, servi$ing, managiend REO #ervi$es in$l/ding detailed re"air inormation, $o

s the entire "ro$ess to ea$h individ/al asset+s /ni/e $hara$termined e4"enses.

meoner $o/nseling, also non as Fenhan$ed &orroer o/e as ell as $alling $am"aigns and letter $am"aigns. Lossnegotiation and li/idation. )R% has develo"ed a 9reerred

Green River Capital

(GRC)

NES

INORMATIONTECHNOLOGY GRC!GR

VALUATION

REO ASMANEGEM

MAR"E

GR INA

SHORT SALEMITIGATION

COMPONENT

DIVISI

00 2!!"1##$

ents!

ng and mareting its $lients+ REO"ara&le val/e analsis, and maretingteristi$s, mareting strateg,

trea$hG that in$l/des "ersonalitigation servi$es also in$l/de short

:roer Detor (9:D that $onsists o

SERVICES AGENT RELATIONS

SETNT ANDING

CIAL

ND LOSSSERVICES

SERVICING

ON

CLIENT RELATIONSBUSINESS

DEVELOPMENT


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2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e


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2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e J

s"e$ii$ "arameters in$l/ding $/stomi5ed "roem"loees m/st sign a $or"orate $om"lian$overseeing sstems and netor se$/rit.the &/siness /nits and roll /" to the e4e$/tiv

)RC maintains do$/mented "oli$ies and "rote$hni$al riter is on sta to $oordinate, rit$/stomi5ed &ased on s"e$ii$ $lient re/irem&/siness /nit to dis$/ss and im"lement "oli$

Assess'ent: 6n o/r vie, )RC h$ontrols and adheren$e to esta&liso vendor &/siness "ro$esses. )Rintranet site or in$reased ease o

Legal Lia$ility and Corporate 1ns/rance

)RC management dis$losed it is not a "arti$&/siness ins/ran$e $overage to "rote$t againins/red as re/ired "/rs/ant to the "arties a

Assess'ent:Overall, e &elieveand is not s/&e$t to an o/tstandi

yste's Arc*itect/re, -ro;ect Manage

)RC /tili5es a variet o "ro"rietar and thirds$ala&le and le4i&le rom a "ro$essing and &

monitor and tra$ all as"e$ts o the Real Estnegotiation and $losing. -he a""li$ation is ala""l i$at ion that serves as a $omm/ni$at ion imareting "ro$ess in$l/ding evi$tion "ro$essi$lient invoi$ing. -he $om"an+s "ro"rietar Ainormation and $onta$t details. Realt 9ilot iins"e$tion ordering and "ro$essing. M# Ligh@nami$ )9 sotare is /sed or all general l9ro$essing #ervi$es, 6n$. or "ro$essing $lienvario/s data and inormation to $lients via thi

)RC has /tili5ed an e4ternal vendor or "ortiores"onsi&le or drating /"dates to the glo&al

restores are $om"leted ith a /ll disaster redigital &a$/" ta"es are stored at an osite)RC+s te$hnolog is &/ilt aro/nd e&&asedsite. @/ring 2013, )RC is em&aring on an enstrateg. )RC ill engage in oint inrastr/$t&/siness $ontin/it and instead ill im"lemeClaton+s #helton, C- head/arters as 10K da$ilitate &/siness re$over time and "rovideto rele$t the $hanges.

)RC re"orts /" to a Chie 6normation Oi$erin$or"orated into an ann/al road ma". A "ro


rved.

$essing and delegated a/thorit levels that hel" to ens/re $"oli$ do$/ment on an ann/al &asis. A dedi$ated se$/ritonthl re"orts en$om"assing o"erating "erorman$e metri

e team.

ed/res on its shared netor drive that en$om"ass its $oree and distri&/te "oli$ and "ro$ed/re /"dates enter"riseients to ens/re $om"lian$e ith servi$e level agreements.

and "ro$ed/re /"dates.

s so/nd m/ltilevel a/diting and /alit $ontrol me$hanisms ed "ro$ed/res. 'e &elieve the $om"an+s "oli$ies and "ro$

sho/ld $onsider migrating the storage o "oli$ and "ro$edse, retrieval and $onsisten$.

i"ant in an "ending material litigation related to its o"eratio st vario/s lia&ilities and $ontingen$ies. Most )RC and )R%

reement.

hat )RC, &ased on its re"resentations, ee$tivel addresseg material litigation.

ent,


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2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e I

& &/siness leaders. #/&e$t matter e4"ertsiss/ed $ontaining sstem enhan$ement inorand /ser "assord "roto$ols. Hser "assor$omm/ni$ated in real time &eteen h/man r/na/thori5ed sstem a$$ess. -he $om"an"rote$t the integrit o $onidential data as itintr/sion "revention sstems designed to ide"erormed to identi sstem v/lnera&ilities.

Assess'ent:Morningstar &elievemanagement re/irements as ell"ro"rietar te$hnolog "rovides thintrod/$e ne "rod/$ts and servi$

is leveraging Claton+s te$hnolog$ontin/it regimen.

-erfor'ance Manage'ent: !endor -erf

(MR R!8) R& Asset Manage'ent

)RC "rovides REO asset management servi$$lients. -hese servi$es in$l/de determiningstrateg or asset mareting. )RC ill monitre"air &ids. )RC ill oversee oer negotiatioa/thori5ation a""roval levels are determined

Loan .oarding and -re=Listing

)RC /tili5es its "ro"ietar REOConne4 sstemanagers and real estate agents to notate aolloing "ro$esses!

Evi$tion 9ro$ess -ra$ing

Val/ation Revie

6ns"e$tion -ra$ing

Mareting 9lans and #tat

Oer Degotiation

Closing 9ro$ess -ra$ing

Client Oversight and

Client 6nvoi$ing.

De assets $an &e &oarded in a n/m&er ore$ord. -he asset set/" $ler (A#C "ro$ee)RCs"e$ii$ details s/$h as the stat/s o ththe Asset #etH" Manager ho "erorms a $relevant asset details are $om"lete and $orreile and re$on$ile that inormation ith the $"/rs/ant to esta&lished $lient and $om"anestate agent ill &e assigned. As an additio&oarded stat/s &/t have aged more than onethe asset is timel reerred to an agent. A Controls Analst and e4e$/tive management.


rved.

in the &/siness gro/"s "arti$i"ate in /ser a$$e"tan$e testination. A dedi$ated enter"riseide se$/rit oi$er is res"

ds are tas and role s"e$ii$ ithin the organi5ation and "aseso/r$es and inormation te$hnolog and revieed monthlas $om"rehensive enter"riseide en$r"tion and ireall "is stored or $omm/ni$ated internall or e4ternall. )RC+s $onti and minimi5e mali$io/s a$tivit. A$tive netor s$anni

s that )RC o"erates ithin a highl ee$tive te$hnolog ar$as its internal "ro$essing needs and e4ternal $lient "erormle4i&ilit ne$essar to meet individ/al $lient re/irementss into the maret"la$e. )RC has $om"rehensive data integ

latorm and geogra"hi$ lo$ation to "rovide a more ro&/st gl

r'ance Metrics

s or third "art $lients. )RC has a&o/t 1I.>00 assets /ndethe estimated maret val/e (EMV or FasisG and Fre"airedGr maret l/$t/ations, listing a$tivit, $hanges in "ro"ert $o

ns as ell as the $losing "ro$ess and inal asset dis"osition.& o& level among sales s"e$ialists, senior sales s"e$ialists

, as ell as other third "art sstems, as a $omm/ni$ationtions d/ring the mareting "ro$ess on a realtime &asis. -h

/s Re"orts

as in$l/ding! email, se$/re ile transer "roto$ol (%-9 site,s ith the &oarding o the asset validating all asset details"ro"ert (a$/ired, redem"tion or $onirmation. On$e re$

om"rehensive revie o the &oarded assets to monitor that$t. As "art o this "ro$ess, the manager ill $he$ the datem"letion date o the A#C+s email to determine i assets are/idelines. -he $lient ile is then orarded to the Vendor Maal level o revie, the Vendor Manager (VM revies a dailda itho/t &eing assigned to an e4ternal real estate agent

eel re"ort o aged assets is revieed, along ith s/""orti.

00 2!!"1##$

and monthl te$hnolog releases arensi&le or ens/ring netor se$/ritord $hanges and deletions areand semiann/all to minimi5eoli$ies and methodologies in "la$e tom"/ter netor in$or"orates severalg and se$/rit monitoring is ro/tinel

ite$t/re designed to meet its datan$e management. -he $om"an+snd "rovides the agilit re/ired torit and se$/rit "roto$ols in "la$e and

o&al disaster re$over and &/siness

management on average ith 22assets and sele$ting the a""ro"riatenditions, mareting e4"enses and

%/n$tional res"onsi&ilities andand managers.

ortal &eteen the $om"an+s assete sstems are /sed to manage the

and dire$t rom a $lient+s sstem orovided & the $lient as ell as othern$iled, the A#C orards an email to&oarding as $om"leted and that alland time stam" o the in$oming $lient&oarded ithin an a$$e"ta&le timelinenagement de"artment here a realre"ort that lists all assets that have a

. -he VM ill ollo/" to see thatg notes, and es$alated to an 6nternal


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2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e ?

Assess'ent:Morningstar &elievete$hnolog or &oarding assets anda$$/ratel in a$$ordan$e ith esta

itle, HA and Real &state a4 Ad'inist

Hnen$/m&ered title is an integral as"e$t oan asset. -he title order re"ort is revieed d$om"anies designated & the $lient and main"o"/lated in REOConne4 or tra$ing "/r"osemissing title re"ort is revieed & the A#C t$ommitments are es$alated to management/sing REOConne4, ill revie the title $ommand moving the asset to /nder $ontra$t stat/

D/m&er o aged assets

9er$entage o assets it

D/m&er o title orders re

D/m&er o assets assign

-he -itle Manager revies the re"ort to iden

8omeoner Asso$iation (8OA ees and realmareting "ro$ess. 9ost&oarding, the 8OAin$l/ding "ar$el n/m&er and ta4ing a/thoritinto REOConne4 or tas tra$ing "/r"oses.ho ill advise and a""rove "ament amo/nthat in$l/des o"erational metri$s s/$h as!

Client s"e$ii$ asset stat

Aged asets &eond 30 d

#"e$ialist s"e$ii$ n/m&

-he Asset :oarding8OA Manager revies tre/ires.

)RC also "rovides $ode violation servi$es to im/ni$i"alit to o&tain $ode violation inormativiolation inormation that is /sed to "rioriti5e

m/ni$i"ali t to resolve violations in$l/ding nethat in$l/des o"erational metri$s s/$h as!

Client s"e$ii$ asset stat

Aged asets &eond 30 d

CVC s"e$ii$ n/m&er o a

Assess'ent:Morningstar &elieveenvironment that in$l/des ee$tive8OA ees, "ro"ert ta4es and $ode


rved.

s that )RC o"erates ithin a el l $ontrolled loan &oarding ere$on$iling data integrit. -he m/lti"le levels o revie ser

&lished $om"an g/idelines and $lient dire$tives.

ration

areting an REO asset. )RC+s -itle @e"artment assigns a tiail & an A#C to monitor that title has &een ordered on alltains individ/al state and $lient s"e$ii$ $riteria or title $oms. -itle $ommitments are s$hed/led to &e re$eived ithin 1ens/re that title is re$eived ithin the 1> da t/rnaro/nd ti

and the title $om"an. 'ithin three das o re$eiving the t itment and notate an o/tstanding iss/es ith an estimated

s. A $om"rehensive monthl re"ort is "re"ared ith "eror

ith o/tstanding title iss/es ithin 120 das o title re"ort

h $lear title as a ratio to total asset $o/nt

/ested and re$eived as ell as timeline e4$e"tions and

ed to title s"e$ialists as ell as their individ/al "erorman$e

i "erorman$e trends and "rovides eed&a$ to title s"e$ia

estate ta4es are revieed to monitor that o/tstanding or "oordinator ill re/est the re/isite inormation rom the ag$onta$t inormation ithin a three da t/rnaro/nd time. H"RC ill ollo /" ith the ta4ing m/ni$i"alit and 8OA and

ts. A monthl "erorman$e re"ort is "rod/$ed and reviee

s (n/m&er &oarded and $losed (&eginning and ending mon

s re/iring ollo/" and resol/tion, and

r o assets and monthl "erorman$e, in$l/ding e4$e"tions.

e re"ort to identi "erorman$e trends and "rovides eed&a

its $lients. A Code Violation Coordinator (CVC ors ith tion hi$h is then /"loaded to REOConne4 or tra$ing. -heassets &ased on violation t"e and e4"os/re. -he CVC then

gotiation and "ament. A monthl "erorman$e re"ort is "r

s (D/m&er &oarded and $losed &eginning and ending mont

s ith $ode violations re/iring ollo/" and resol/tion, a

ssets and monmthl "erorman$e, in$l/ding e4$e"tions.

s that )RC o"erates ithin a ell $ontrolled title, 8OA and rte$hnolog or identiing and resear$hing o/tstanding itemviolations. )RC has ell esta&lished timelines or investiga

00 2!!"1##$

nvironment that in$l/des ee$tivee to monitor that assets are &oarded

itle re/est ithin =I ho/rs o &ordinge/isite assets. -he A#C /ses titlean sele$tion. -he title order date is

> das o the order date and a eele. An delas in re$eiving title

itle $ommitment, a -itle #"e$ialist,$om"letion time "rior to $learing titlean$e metri$s in$l/ding the!

metri$s.

lists as "erorman$e re/ires.

st d/e items do not im"ede the REOent or 8OA and "ro"ert ta4esn re$ei"t, the inormation is entered$omm/ni$ate the res/lts to the $lient& the Asset :oarding8OA Manager

hl &alan$es

$ to s"e$ialists as "eorman$e

e agent, title de"artment andCVC revies a dail re"ort o $ode$omm/ni$ates ith the agent and

od/$ed and revieed & management

hl &alan$es

nd

eal estate ta4 administrations related to title iss/es, o/tstandinging and re/esting data and invoi$es


10/18



as ell as olloing /" on aged itea$$ordan$e ith esta&lished $om"

R& Asset Manage'ent

)RC "rovides REO management servi$es to vinvestment &ans and investors o non"eroro the REO dis"osit ion lie$$le rom "ostor

%ig/re 3! REO Asset -imeline

As "art o the REO management "ro$ess )Rval/e (RMV or ea$h asset. )RC /tili5es a "$onta$t data, li$ense inormation and ins/ran)RC+s netor o a""ro4imatel J,>00 agent

)RC+s teams o sale s"e$ialists are res"onsi&

@etermining the estimat

#ele$ting the a""ro"riat

Monitoring the "ro"ert

that ma re/ire re"airs

Degotiating oers and

Oversee $losing and inal

-he organi5ational str/$t/re is em&edded itsales s"e$ialists &/t have a higher level o a/)RC has develo"ed standard timelines to traasset rom va$ant to listed stat/s. 6n generalo this "ro$ess )RC ill determine the estim/ni/eness, e$onomi$ $ondit ions, "ro"ert aill "a in the asset+s $/rrent maret. A detstrateg. -he de$ision to sell FasisG or Fre"aman/al and a/tomated tools are /sed to analma &e ordered to re$on$ile the inal estimat

On$e a val/ation has &een determined, )RCdetermining re"airs so the &id "ro$ess $an $mold, dee$tive drall, metham"hetamine lins"e$tions and environmental "ro"ert iss/ere"air. Emergen$ re"air or to remed aninto a mareta&le $ondition and $onsist o "ri$ondition. )RC has develo"ed $a"ital re"air"rovides re$ommendations to the $lient on r

A##etRe$erral t%

GRC

Pre&Mar'etin

(O*pie+!Vaant)


rved.

s. -he m/lti"le levels o revie serve to monitor that assetan g/idelines and $lient dire$tives.

ario/s $lients in$l/ding )#E+s, inan$ial instit/tions, &an anming loans and residential mortgage &a$ed se$/rities (RM$los/re a$/isition thro/gh mareting and $losing.

ill o&tain re"air inormation, "ro"ert $om"ara&les, maro"rietar e&&ased a""li$ation non as AgentConne4 to$e. Agent assignments are managed via this sstem. -hes and oversees agent sele$tion, s$oring, training and $omm

le or the olloing REO asset management /n$tions!

d maret val/e (EMV or asis and re"aired "ro"erties

mareting strateg (asis or re"aired

areting stat/s in$l/ding maret l/$t/ations, listing a$tivit

asset dis"osition.

h additional levels o $he$s and &alan$es. #enior sales s"ethorit. Managers a""rove maret strategies, re"air &ids, e

the REO dis"osition lie$$le. A "relist timeline identiiesl, the timeline $riteria is 1I das or an asis "ro"ert and =0ted maret val/e hi$h $onsists o a $onsideration o m/ltienities and overall $ondition. -he estimated maret val/e i

rmination is made hether to maret the "ro"ert in an FasiredG is determined & anal5ing the &roer "ri$e o"inion (:9l5e the val/ations and re$on$ile an varian$es. :ased on "red maret val/e.

ill $reate a mareting strateg hi$h in$l/des esta&lishingmmen$e and tra$ing "ro"ert ins"e$tions and ne$essar&s, et$. )RC has detailed "oli$ies and "ro$esses o/tlinings. 9ro"ert re"air or is $onsidered either a $a"ital re"air/nsae "ro"ert $ondition is "erormed immediatel. Ca"italmaril $osmeti$ im"rovements and re"airs to &ring the "ro"anagement team that has $reated &id $riteria herein the r/ired and re$ommended re"airs. 'hen $a"ital re"airs are

Mar'etinUn+er

C%ntrat

00 2!!"1##$

s are &oarded a$$/ratel in

non &an servi$ers, hedge /nds,#. -he $om"an servi$es all as"e$ts

ting "lans and a re$on$iled maretmanage &roer inormation, in$l/dinggent Relations @e"artment overseesni$ation.

, and $hanges in "ro"ert $ondition

$ialists "erorm the same /n$tions as"enses and oers, as re/ired.

the ste"s ne$essar in &ringing andas or re"aired "ro"erties. As "artle varia&les in$l/ding marets a "roe$tion o hat a illing &/erisG $ondition vers/s a Fre"airedGO and a se$ond o"inion val/e. :othedetermined $riteria, a third val/ation

a &/dget or all mareting $ostsis$los/res in$l/ding! lead &ased "aint,ario/s state re/irements regardingr a "reservation and maintenan$e

l re"airs are done to &ring the "ro"ertrt into ha&ita&ilit or inan$ea&le

e"air s"e$ialist revies the &ids and$om"lete, the asset moves into a

Cl%#inA##et

Li,*i+ati%n


11/18



listed stat/s. 9reservation and maintenan$ema in$l/de interior $leaning, trash o/t, sno"reservation and maintenan$e $ontra$tors ora$$ording to initial and ongoing timeline matrsele$t an inde"endent $ontra$tor. )RC has d-he $om"an has an e4"ense varian$e re$on

)RC maintains an REO &roer s$ore$ard thatmeas/rements in$l/de the olloing!

@as to re$eive a re/ested :9O

@as on maret ith agent

)ross sales "ri$e to initial agent :9

@as in es$ro.

-he s$ore$ard rele$ts a si4 month rolling ave"erorman$e meas/rement.

On$e an asset has &een listed or mareting,and that an ei$ient and timel dis"osition osales s"e$ialist to revie &roer stat/s re"orrevisions ma in$l/de a list "ri$e red/$tion, rto determine i there have &een signii$ant mstrateg and &/dget and ill &e or loed

9/r$hase oers on REO "ro"erties are $onsid$al$/lation. As an oer is revieed, the ollo

:/er re/ested $on$es

Oner o$$/"ant vers/s i

:/er /alii$ations

Mortgage ins/ran$e $ov

Re"/r$hases.

%ig/re =! Closing @e"artment 9ro$ess

-he oer "ro$ess, in$l/ding oer revie, a$$&roer is res"onsi&le or $om"leting the oeragent. -he oer is sstem $oded as a""rovamanager, as el l as a""li$a&le third "art m

A##et Set&Up


rved.

re"airs are initial and $ontin/ing servi$es to maintain the asremoval, reeing, "ool $leaning and ard maintenan$e. )ill /se a $lient+s third "art $ontra$tor to "erorm "ro"erti$es. 6 there is no a""roved "ro"ert and maintenan$e venevelo"ed s"e$ii$ "reservation and maintenan$e a""roval g

$iliation "ro$ess or those e4"enses not in$l/ded in the origi

meas/res the "erorman$e and ee$tiveness o its &roer n

O and

rage, and "rovides val/a&le eed&a$ to the vendor as ell

)RC ill monitor the "ro"ert on a reg/lar &asis to see that the "ro"ert taes "la$e. . #stemgenerated tas reminds to eval/ate a$tivit and $onsider revising the $/rrent marvising the mareting strateg andor "erorming re"airs. -he

aret $hanges sin$e the asset as listed. A sstem tem"latto the a""ro"riate manager or signo, i re/ired.

ered &ased on a n/m&er o $riteria altho/gh "rimaril an oeing a$tors are among the $onsiderations!

ions

nvestor

rage and

e"tan$e, $o/nter or ree$tion, and a""roval are all re$orded"a$age and o&taining the re/isite &/er signat/res and ol "ending and ma re/ire additional levels o a""roval &eortgage ins/rers or $lients.

viti%n#Title an+ HOA

Revie- an+ Pa./ent

00 2!!"1##$

et in mareta&le $ondition. -his orC has develo"ed a netor omaintenan$e and "reservation oror in a geogra"hi$ area, the &roer illidelines and dis&/rsement thresholds.al &/dget or that e4$eed the &/dget.

etor. e "erorman$e

s internall to )RC or internal

the "ro"ert $ondition is maintainedrs a""ear ea$h month reminding theet strateg. Mareting strategsales s"e$ialist ma order a ne :9O

e ill re$ord $hanges to the mareting

r is vieed in relation to the net ret/rn

nd "ro$essed via a/tomation. -herarding the "a$age to the $losingd the sales s"e$ialist, in$l/ding a

Cl%#in


12/18



#ales s"e$ialists are revieed monthl & this &ased /"on "rod/$tion $riteria (t/rn rate,)RC re$eives rom $lients and a monthl /al

On$e an oer is inali5ed and agreed /"on &("/r$hase agreement ith the re/isite adde$losing date, s$hed/le d/ring the negotiation$oordinator manages all timeline ste"s &etminimi5ed. -he $losing $oordinator a$ilitate/"$oming $losing dates or ollo /". Closingand ma &e granted d/e to tenant evi$tion is&ased on the olloing $onsiderations!

Maret $onditions 9ro"ert $ondition

%inan$ing timelines

8istor o m/lti"le e4ten

Re"air, title or evi$tion is

-he $losing $oordinator ill also veri third "and re$on$ile an varian$e in e4"e$ted $ash

On an enter"riseide level, )RC re$eives e4data s/""lied to )RC $an in$l/de!

Monthl inventor

-otal dis"ositions and as

Aged inventor

9ortolio t/rn rate

@is"osition t/rn rate

#ales re$over (asis ver

A$$/ra$ rate and

-itle resol/tion (N das.

'e have revieed vario/s s$ore$ards "rovidre/irements as o/tlined in their servi$e level

Assess'ent:)RC, in o/r vie, h9oli$ies, "ro$ed/res and "ro$essesmanage ea$h "hase o the REO lies/""orted & a ro&/st te$hnologmanagement. -he organi5ational s$learl esta&lished via matri$es thadetermining servi$e level agreemestandards are ell deined and em)RC+s $lients and is revieed to deim"rovement.


rved.

ir managers on their individ/al "erorman$e as ell as "eroales rate, tass "ast d/e and e4$e"tions "erorman$e $rit

lit $ontrol revie that meas/res adheren$e to "oli$ies and

&oth the &/er and )RC, the listing &roer m/st s/&mit a /lnda and dis$los/res to the $losing agent and the asset is th"ro$ess, is esta&lished or the &/er and $losing agent to ien $ontra$t e4e$/tion and $losing, so that all e dates $a$omm/ni$ation among the "arties to the transa$tion and ndate e4tensions are $onsidered & the $losing $oordinator i

s/es, title iss/es or an event o/tside o the &/er+s $ontrol.

sions and

s/es.

art e4"enses, revie the 8H@ 1 settlement statement, and"ro$eeds.

tensive "erorman$e eed&a$ rom vario/s $lients regarding

signments

s/s re"aired sales

.

ed to )RC & e4ternal $lients and note that )RC s/&stantialll agreements.

s e4$ellent internal $ontrols and orlo management oveare ver $learl deined together ith a high level o te$hno

$$le. Ever as"e$t o REO asset management, rom &oardinnvironment or orlo ei$ien$, tas tra$ing and ollo

tr/$t/re is designed to "rovide or vario/s levels o em"loet delineate re"orting lines and signo a/thorit. 9erorman$t $om"lian$e, is m/ltilaered and $onsists o internal and eloee "erorman$e is $olle$ted and revieed ith sta . 9etermine servi$e level agreement $om"lian$e as ell as iden

00 2!!"1##$

rman$e vers/s "eers. -he inal raningria e4tra$ted rom s$ore$ards thatro$ed/res.

l e4e$/ted $ontra$t "a$ageen $oded as F/nder $ontra$tG. Aali5e the transa$tion. A )RC $losingn &e met and aged inventor isotates the sstem ith "ast d/e and

$ons/ltation ith the sales s"e$ialist8oever, an e4tension ma &e denied

tra$ the timel re$ei"t o ired /nds

its servi$es. 9ortolio "erorman$e

$onorms to "erorman$e

r its REO asset management "ro$ess.log, ena&ling )RC to ee$tivelg and "relisting to inal dis"osition is/" as ell as "erorman$e

res"onsi&ilit and a/thorit levels aree management, es"e$iall henternal revies. /alit $ontrol

rorman$e eed&a$ is "rovided &tiing internal "erorman$e areas or


13/18



Loss Mitigation ervices: Asset .oardin

)R% "rovides $lients ith a "rogram that "ro$am"aigns. -his servi$e in$l/des door no$)R% is a li$ensed de&t $olle$tor in all >0 stat$lients.

-he )RC asset transer de"artment /"loadsdata s$r/& and validation "ro$ess &eore /"ldas "rior to the a$$o/nt assignment a$$om$om"lete the assignment and the irst o/t&ohome are mandated in an attem"t to mae $

Assess'ent: )R%, in o/r vie, hvalidations to ens/re a$$o/nt a$$/the res/lts o those intera$tions.

Loss Mitigation ervices: Ho'eo0ner C

-his area is &i/r$ated /nder )R% and has m/o/trea$hG that in$l/des "ersonal intervies a"rovided /nder $om"onent servi$ing is short:roer Detor (9:D that $onsists o a nati"roessionals m/st "ass )RC+s de&t $olle$tordelin/ent &orroers & ed/$ating and g/idi

)R% has develo"ed a netor o real estate

in the homeoner $o/nseling "ro$ess. D8C"ro$ess. D8C re"resentatives /ndergo e4teidentiing the &orroer+s illingness and a&istrateg and most via&le alternative to ore$lstrateg is a short sale, the D8C ma &e$omto )R% a$$ordingl /sing the olloing g/ideli

Do $onta$t! D8C is /na

Conta$t (no interest or s

Conta$t (arm transer

short sale. A tele"hone

Conta$t (intervie and i

o"tions availa&le ith ththe mortgage servi$er le

Conta$t (interested in a

All D8C $onta$t attem"ts are revieed andorm andor inan$ial inormation to the assetvisit to the &orroer, the asset manager ill$onversations and ollo/" $ond/$ted & thordering. On$e a short sale order is inali5ed,


rved.

g and Agent Assign'ent

ides "ersonal intera$tion ith &orroers ho ma not &e ring, in"erson intervies and arm transers to the $lient os and the @istri$t o Col/m&ia ith a""ro4imatel >,000 ass

ro"ert re$ords to )R% via REOConne4 ith data "rovided &ading assets. )R% generates an %@C9A $om"liant notii$atianied & inan$ial orms. -he Deigh&orhood 8ome Cons/ltnd attem"t at homeoner $onta$t m/st &e made ithin =I

onta$t and a minim/m o to visits m/st &e attem"ted ate

s ee$tive sstems in "la$e to &oard in$oming assets andra$. -he $om"an has ell deined methodologies in "la$e

o/nseling

lti"le $om"onents that in$l/de homeoner $o/nseling, alsot a &orroer+s residen$e as ell as $alling $am"aigns and lesale and deedinlie/ o ore$los/re negotiation and li/idatinide netor o real estate "roessionals ith distressedand $om"lian$e training and testing "rograms. 9:D "roes

g them thro/gh loss mitigation alternatives.

roessionals designated as neigh&orhood home $ons/ltant (

re"resentatives /se the 8omeoner Resol/tion #stem (8Rsive training in the %air @e&t Colle$tion 9ra$ti$es A$t. -he o lit to "a o&taining inan$ial statement inormation! "rovidi

os/re $olle$ting "hotos o the "ro"ert e4terior and interiore the listing agent. D8C re"resentatives ill attem"t to manes!

le to mae $onta$t ith the &orroer or "ro"ert o$$/"ant

ort sale lead D8C maes $onta$t, &/t the homeoner is n

D8C maes $onta$t and the homeoner is interested in loa

all is made to the mortgage servi$erlender hile at the "ro

an$ials arm transer D8C maes $onta$t and the homeo

mortgage servi$erlender. D8C o&tains inan$ial inormatioder hile at the "ro"ert.

hort sale o"tion D8C maes $onta$t and the homeoner i

eriied & the asset manager assigned to the a$$o/nt. -hemanager and the orm is /"loaded into 8R#. 6 a arm tran

$onta$t the mortgage servi$erlender to veri that a arme asset manager is notated in the sstem as ell as the inathe asset is transerred to the REOConne4 sstem or /rthe

00 2!!"1##$

s"onding to tele"hone and letterre"ament "lans or modii$ations.

ets /nder management and n/mero/s

the $lient. -he sstem "erorms an to the de&tor a""ro4imatel o/r

ant (FD8CG has ten (10 das toho/rs. -hree visits to the de&tor+s>"m or on a eeend.

erorm the re/isite data integritto initiate &orroer $onta$t and re$ord

non as Fenhan$ed &orroertter $am"aigns. Another servi$en. )R% has develo"ed a 9reerredro"ert oro/t e4"erien$e. 9:Dionals are res"onsi&le or oring ith

D8C ho have agreed to "arti$i"ate

# to tra$ and manage the $o/nselinge$tives o the "rogram in$l/de!ng $o/nseling to determine the &est(i "ossi&le. 6 the &est alternativee $onta$t ith the de&tor and re"ort

.

t interested in an "rogram.

modii$ation o"tions other than a

"ert.

ner is interested in alternative

n rom the homeoner and tele"hones

s interested in a short sale.

8C $om"letes the re/isite $onta$tser has o$$/rred d/ring the D8C+stranser a$t/all o$$/rred. Alln$ial inormation, "hotos, and :9Or "ro$essing and tra$ing.


14/18


2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e 1=

Assess'ent! 6n o/r vie, )R% ha"rogram. Ro&/st te$hnolog s/""res/lts and "rovides asset manage

Loss Mitigation ervices: *ort ale -ro

%ig/re >! #hort #ale 9ro$essing -imeline

A short sale "a$age is sent to the &orroer

6n$ome and e4"ense sta

8ardshi" aidavit

-o most re$ent ta4 ret

-o months o the &/er

9/r$hase $ontra$t

Estimated 8H@

Listing agreement and

9roo o /nds andor a""

A )R% asset manager retains onershi" o ta""li$a&le. -he asset manager assigns an Dthree visits, the "a$age is not o&tained, the$lient ill "erorm a "reliminar revie or 8/"date the sstem a$$ordingl. 6 a "a$agelisted or the homeoner (i it is not listed t(:9O or a""raisal de"ending on Client s"e$iiand anal5e an oers against the re$on$iledthe oer to the )R% sales manager or /rthe

Initial S0%rt SalePa'ae an+

Te/plate Veri$iati%n

S0%rt Sale Pa'aeRevie-

O+erin A Pr%pert.Val*e

Revie-in An O$$er


rved.

ell develo"ed methodologies in "la$e or assigning assetrts all as"e$ts o the $o/nseling "rogram and allos the $o

rs ith an ee$tive to tool manage asset dis"ositions.

cessing and Facilitation

re/esting most or all o the olloing inormation!

ement

rns o the &/er

+s most re$ent &an statements

roval letter.

e a$$o/nt and ill revie the ile or data a$$/ra$ and detC to mae a series o visits to the &orroer to o&tain a $o

asset manager ill notate the a$$o/nt a$$ordingl. H"on reme Aorda&le %ore$los/re Alternative (8A%A eligi&ilit andis re$eived &/t there is no oer, the asset manager ill $ondetermine "ro"ert stat/s and the air maret val/e, i the

$ations ill &e ordered & )R%. -he )R% asset manager illmaret val/e (RMV and &ased on esta&lished $riteria, ma

r determination. 6 a s/&ordinate lien is identiied, the asset

I+enti$. an+Ne%tiate

S*1%r+inate Lien#

O$$er Ne%titati%n

M%rtae In#*raneAppr%val

S0%rt SaleDei#i%nin Pr%e##

Preli/inar. HUDRevie-

Un+er-iritn Revie-2 A##et /anaer

Appr%val

S0%rt Sale Cl%#in

00 2!!"1##$

to its neigh&orhood $o/nselingnselors to a$$/ratel re"ort their

rmine i mortgage ins/ran$e is"leted short sale "a$age. 6, ater$ei"t o a $om"leted "a$age, the)RC ill revie the "a$age anda$t the listing agent (i the "ro"ert isro"ert is listed. A "ro"ert val/ationrevie a $om"leted val/ation "a$ages/ggest a $o/nteroer or ma reer

anager ma negotiate a short "ao


15/18


2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e 1>

to the s/&ordinate lien holder &ased on esta&sees a""roval rom the mortgage ins/rer an$lient $riteria that determines i the short salon esta&lished $riteria ma re/ire revie anoer and /"date the asset stat/s to F/nder $/" & a letter rom the asset manager ith d$ontin/e to ollo /" ith the "arties "eriodi

Assess'ent! 6n o/r vie, )R% hamethodolog is ell deined and is$losing "ro$ess. )R% has develo"eand oer negotiation.

-erfor'ance Manage'ent: Co'ponent

(MR R8) Residential Co'ponent ervi

Real &state !al/ation, 2/e 2iligence an

%ig/re

Val/ation desto" revie

9re and "ostreha&ilitati

Reha&ilitation :/dget Re

-itle Revie and $/rative

Collateral ile revie

6ns/ran$e revie and ver

9ro"ert ta4 revie and

Val*ati%*l$ill/en

(3 TE)


rved.

lished $riteria and a""roval & the $lient. 6 mortgage ins/rad ill ollo /" /ntil resol/tion. A ro&/st de$isioning tool is

oer ill "ro$eed. A "reliminar 8H@ revie is /ndertaend a""roval & senior )R% management. -he asset managerontra$tG in the sstem o re$ord and noti the listing agentetails s/$h as the $losing date, net amo/nt d/e and iring i$all to monitor that the $losing taes "la$e as s$hed/led.

ell develo"ed "ro$esses in "la$e to generate, revie ands/""orted & ro&/st te$hnolog at ea$h ste" o the short sad ell deined $riteria, &ased on $lient "arameters, or short

ervicer -erfor'ance Metrics

cer

-roperty Manage'ent versig*t

i5ational Chart

amil rental REO asset se$/riti5ation, )RC esta&lished thee needs o instit/tional investors and lenders o single amilario/s servi$es related to $ollateral /nderriting on more th

n$ as an REO asset manager to "rovide a /ll s/ite o servi$-he Com"onent #ervi$es @ivision ill "erorm the olloing

s

n "ro"ert ins"e$tions

on$iliation

servi$es

ii$ation

erii$ation

C%/p%nentServiin Divi#i%n

(Vie Pre#)

t

Val*ati%n Revie-an+

4*alit. C%ntr%l

(3 TE)

ile Revie

(3 TE)

00 2!!"1##$

n$e is a""li$a&le to the asset, )R%/sed to "re/ali the oer &ased onto as$ertain $losing $osts and &ased

ill revie and a""rove the short salend &orroer o the a""roval, olloedstr/$tions. -he asset manager ill

a$ilitate short sale oers. -hele do$/mentation revie, val/ation andsale ile "ro$essing, val/ation revie

Com"onent #ervi$es @ivision in 3rental "ro"erties as ell as &/ers andn 2.J> &illion in single amil rental

es or individ/al $om"onents or/n$tions!


16/18


2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e 1K.

RC has develo"ed a "ro"ert management s/rveillan$e andregional or nationide single amil rental REO netor his

management netor. )RC has addressed the need or a $s oring ith its "arent, Claton, to develo" a sstemati$ "agement. -he $om"an+s "ro"ert management oversightironment & ass/ming $ontrol o rental streams and "hsi$a

l, regional and national servi$e "roviders to develo" GhotG or to ass/me management o large, m/ltisite residential "ors ma re/ire shortterm interim meas/res or a more longtenario )RC ill "rovide s/rveillan$e over a national "ro"ertria (li$ensing, &a$gro/nd $he$s, ins/ran$e and "roviding

ded at the individ/al "ro"ert, maret"la$e, and "ortolio levro"ert management $om"an and other so/r$es and &en$deled $ash lo "roe$tions, and a$t/al maret data. @etail

00 2!!"1##$

o these assets. )RC is sele$ting andvid/al :9O+s ill &e "ersonallor a$$/ra$, $om"leteness andtion de"artment ill re/est aenan$e and "otential environmental"ro"ert, in its "resent $ondition, ise$tion ill &e $om"leted tot. )RC ill "erorm &/dgetined in the :9O or "ro"ert ins"e$tion.

ie g/idelines. )RC ill revie title toilit. )RC assigns a title gradeevelo"ed, a$$om"anied & anm"an and the oner+s title $/rativeion and $/rative "ro$esses.

at the deed inormation is $orre$t.

e and

ings.

i e4$e"tions or re"orting to theoner. )RC re$on$iles the maret

rming that the ins/red val/e amo/ntre re"orted to all staeholders. -a4"art on a 10K sam"ling si5e o the

oversight "rogram or "arti$i"ants intori$all, there has &een no demand or

oherent, ell managed single amilro$ess to identi and monitor the ris"rogram ill $reate sta&ilit or lendersl $ollateral.

FarmG "ro"ert management &a$/"tolios on a nationide &asis. -heerm sol/tion, de"ending /"onmanagement netor, /aliing

/alit s$oring on their or on a gols. )RC ill o&tain assetlevelmar the data to servi$ing ind/str

ed asset level "erorman$e re"orting


17/18


2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e 1J

ill &e "rovided to $lients and, i ne$essar,$on$erns. : develo"ing a relia&le nationid)RC, investors in the single amil REO rentale4e$/ting a "ermanent management sol/tio

Assess'ent! 6n o/r vie, )RC+sval/ation, and "ro"ert ins"e$tion-he $om"an+s seamless integratioCom"onent #ervi$es @ivision and trate validation "roto$ols "rovide a

Acco/nting and 1nvoice Manage'ent

-he A$$o/nting @e"artment in$l/des A$$o/nRe"orting. -he 6nvoi$e Management (6M s

in$l/de reim&/rsa&le e4"enses, servi$ing ee$om"an via the 6M sstem or man/all viaman/all enter all a""roved e4"ense reim&/rdonloaded dail into REOConne4 or s$r/&&is"e$ii$ $l ient reim&/rsement and "ament gREOConne4 to the Mi$rosot @nami$s )9 a$sotare to veri the alignment o e4"ense-he also "erorm a /alit revie, &ased onassem&led & the :illing Coordinators are the

On$e vendors have &een "aid, )RC m/st &ille4"enses derived rom a $/m/lative list o /"a$$om"lished & vario/s means in$l/ding lat

vendor+s "aid invoi$e to the $lient or reim&/ra$$o/ntant "erorms a re$on$iliation o all /nRe"orting areas to remediate dis$re"an$ies,

6n$oming "aments to )RC are revieed &and orards the $he$s to an A$$o/nts Re$"erorms a dail re$on$iliation o $ash re$ei"site to identi dis$re"an$ies and remediate tas /na""lied $ash and m/st &e resear$hed amanagement to ens/re $om"leteness o thea$$o/nts re$eiva&le Fdee" diveG hi$h $onsimisa""lied "aments, validating $lient re/nd

6ndivid/als in the a$$o/nting de"artment arere$on$iliation re"orts are revieed & the )R

Assess'ent! Morningstar &elievte$hnolog environment. - he orgaamong invoi$ing, &i lling revie, a$m/lti"le levels o revie and a$$o/

Ranking 2efinitions

-he n/meri$al s$ale o *MOR RVR#1+ to *MO


rved.

RC ill or ith the "ro"ert management $om"an ande netor o residential "ro"ert managers ith inde"endens"a$e $an sta&ili5e their a$/ired "ortolios and ei$ientl dor a dis"osition strateg.

Com"onent #ervi$es @ivision has s/$$ess/ll leveraged its4"ertise to develo" a s/ite o strategi$ servi$es to the gron o e4isting te$hnolog "rovides a sta&le o/ndation or thehe $om"an+s reha&ilitation &/dget re$on$iliation "ro$ess.ignii$ant added val/e or $lients

ts 9aa&le and Re$eiva&le, :illing Coordinators, )eneral Ledstem is /sed to "ro$ess invoi$es or agent e4"enses and rei

s, $an$ellation ees and management ees. E4"ense reim&/ail or email. -he revie and a""roval "ro$ess is "erormedsement re/ests into REOConne4. A/tomated e4"ense reing and validation. :illing Coordinators revie the e4"ense r/idelines "/rs/ant to a $lients"e$ii$ ee matri4. -he a""rov$o/nting sotare. -he :illing /alit Control analsts "erorto designated $lients and validate all s/""orting &illing inor"redetermined $riteria, or e4"enses "ro$essed via the 6Mn s/&mitted or senior level a""roval and "osted or "amen

$lients or reim&/rsement. -he 6nvestor Re"orting Analst "todate e4"enses e4tra$ted rom the @nami$s )9 a$$o/ntiles or remittan$e s/mmaries via the 6M sstem, /tili5ation

sement, or inal e4"ense re$on$iliation on the 8H@1 $losing&illed e4"enses et to &e &illed to the $lient and intera$ts ihe res/lts o hi$h are revieed & the Controller.

n A$$o/nts 9aa&le em"loee ho $reates a $ash re$ei"tseiva&le em"loee ho also re$ords ele$troni$ "aments ands entered into the a$$o/nting sstem ith the de"osit re$orhem in a timel manner. All "aments that are not immediad "ro$essed & month end. -he re"ort o /na""lied $ash is

re$on$iliation "ro$ess. -he A$$o/nting and 6nvestor Re"ortists o revieing aged $lient re$eiva&les, strategi5ing to $olles, and reerring aged items to an attorne or $olle$tion.

$rosstrained to in$rease noledge de"th and minimi5e t/C Controller and Claton+s Chie %inan$ial Oi$er or a""roval

s that )RC demonstrates solid $ontrols in its a$$o/nting "rni5ational str/$t/re o )RC+s a$$o/nting de"artment "rovideo/nts re$eiva&le and "aa&le, and general ledger managemnta&ilit &oth on the )RC level and ith oversight & its $or

R RVR#=+ is deined as ollos!

00 2!!"1##$

lient to remediate an "erorman$et vetting and s/rveillan$e "erormed &evelo" a transition strateg and hile

4isting enter"riseide d/e diligen$e,ing single amil REO to rental maret./ll s/ite o servi$es oered & thedditionall, lease revie and rental

er Management, and 6nvestorm&/rsements. Client &illings ma

sement re/ests are s/&mitted to the& a gro/" o :illing Coordinators ho/ests re$eived via the 6M sstem aree/ests to veri that the meeted e4"ense data is transerred romm a dail revie ithin the a$$o/ntingmation on man/all entered e4"enses.stem. 9ament "osting &at$hest.

re"ares an invoi$e or reim&/rsa&leing sotare. Client invoi$ing iso the 6M sstem to orard a

orm. A senior general ledgerth the A$$o/nting and 6nvestor

&at$h ithin the a$$o/nting sstemires. A general ledger a$$o/ntant

d rele$ted on the &an a$$o/nt e&tel a""lied to an invoi$e are $lassiiedrevieed monthl & senior sta andng areas meet ti$e monthl or an$t "ast d/e &alan$es, $orre$ting

nover. On a monthl &asis, vario/sand signo.

$ti$es, s/""orted & an ee$tivethe re/isite segregation o d/ties

ent. -he $om"an has em&eddedorate "arent, Claton.


18/18


2013 Morningstar Credit Ratings, LLC. All Rights Rese9 a g e 1I

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