ONE DAY OUT OF FORECLOSURE PROGRAM - AZ

Occupancy Owner Occupied only, must not have ownership interest in any other residential dwelling.

Property Type Residential Single Family houses only. No Condos, multi-unit, mobile home or land only properties.

Loan Purpose Purchase or Refinance

Product Type Note and Deed of Trust

Loan Term/Amortization 30 year amortization, with balloon due in full at 10 years

Property Location 50 mile radius of downtown Phoenix, AZ (Central & Washington)

Loan Limits Minimum: $ 60,000.00 Maximum $175,000.00

Eligible Borrower(s) Lawful US Residents, at or over age of legal contract

Eligible Occupying Co-Borrower Co-Borrower will be qualified the same as primary borrower. Co-borrower may not be a third party to the transaction: seller, realtor, builder, appraiser

Non Occupying Co-borrower Permitted with no additional debt ratio limitations

Interest Rate 12.00% fixed with no rate buydown available

Fees 3% Origination $1430.00 (UW & Doc Prep)

Third Party Contributions The seller and/or other third party may contribute up to 6% of the lesser of the property’s sale price or value toward the borrower’s closing costs and prepaid expenses

Maximum Loan to Value 75.00%

Qualifications must meet ONE of the following (1A, 1B OR 1C):

1A FICO Score Minimum FICO Score of 620. If “Thin FICO”, then move to criteria below. Definition of “Thin FICO” is only one FICO score or less than 4 tradelines.

1B Alternative to credit score (traditional method)

Minimum credit history of four tradelines active at least 24 months; no more than nine open tradelines; no collection accounts or judgments within 24 months of application. No housing or payment delinquency within 24 months (not including delinquency on foreclosed property); no delinquency on revolving or installment debt within 12 months of application. No more than one revolving or installment account reflecting 30 day delinquency during the 13-24 months preceding application.

1C Alternative to credit (non-traditional credit)

Minimum four sources of non-traditional credit active at least 12 months. Sources must include housing payment and utility companies. No delinquent housing payments within 24 months of application (not including delinquency on foreclosed property); maximum of one 30 day delinquency on remaining accounts; no judgments.

Bankruptcy

Bankruptcies will be reviewed on a case by case basis. Loans will NOT be made to borrowers who file bankruptcy due to financial mismanagement. Borrower must provide complete bankruptcy papers and documented explanation to support a one-time event beyond the borrower’s control.

Foreclosure

Must disclose reason for foreclosure in detail. If foreclosure is only derogatory credit and causes FICO to fall below minimum standard, there will be UW discretion on adjustment to FICO and second signature will be required.

Tax Liens Must be paid prior to closing – no exceptions

Judgments All judgments must be paid prior to closing – no exceptions

Collection Accounts First apply Credit guidelines from 1A/1B/1C as appropriate. If Credit guide is met collection(s) may remain unpaid if aged over 2 years, aggregate of $5000.00 or less and 5% payment must be included in qualifying ratios.

Payment Shock If currently renting, the new PITI payment must be less than 150% of the prior rental payment (including rental insurance). If not renting, must show average savings equal to or greater than 100% of the new PITI over the past 12 months.

Residual Income Minimum $1,500.00 (monthly income less PITI)

Property Valuation Borrower will pay for independent appraisal

Property Ownership Fee simple with no encumbrances. Title Insured. No leased land.

Security Required

Loan must be in first lien position encumbering the total property. Property Insurance in joint names of beneficiary and borrower to cover the replacement value of the property. The policy is to be index-linked if available. Recorded Deed of Trust and Note signed by the borrower, with originals held at the servicing agent’s office.

Verification Supporting documents: 2 years tax returns, 2 months’ pay stubs, 2 months’ bank statements, signed employment verification from employer.

Maximum Debt Ratios 31.00/43.00 No Exceptions

Reserves 3 months PITI in a deposit account. Additional reserves may be used as a compensating factor.

Cash on Hand The amount of cash on hand must be commensurate with the borrower’s employment income and expenses. (Follow FHA on cash accumulation)

Gift Funds

Borrowers may obtain a gift from individuals who are related to the borrower by blood, marriage, adoption, legal guardianship or persons with a documentable, established relationship with the borrower. Must obtain fully executed gift letter which includes: Donors Name(s) Borrower(s)’ Name(s) Relationship of Donor to Borrower Amount of gift Statement that no repayment is expected AND Document transfer of funds with one of the following: Copy of Donor’s check and borrower deposit slip Copy of Donor’s withdrawal slip and borrower’s deposit slip Copy of donor’s cashier check presented to the closing agent

Borrower Education & Counseling Borrower will be provided HUD’s Settlement Cost Booklet with the GFE and will acknowledge receipt of Booklet at closing.

Servicing

All loans are serviced by Amerifirst Financial, Inc. All loans must be impounded: Property Insurance will be pre-paid for one year at the time of closing and 1/12

th of

the annual premium will be impounded per month. Taxes will be paid current at closing and 1/12

th of the yearly taxes will be impounded

per month.