Mortgage Impairment Application 2006

PROPOSAL FORM (2006)

FOR MORTGAGE PROTECTION INSURANCE

SUMMARYOFAVAILABLE COVERAGES:

Any combination of sectionsoutlined below may be purchased, provided SectionsA and/orC are included.

Section A(1): Physicallossordamagefrom‘RequiredPerils’.CoverslosstotheAssured’sinterestthroughtheuncollectability ornon-existenceofinsuranceagainstperilsthatarerequiredbytheborrower–includingmandatoryflood insurance– in theAssured’sloan closing procedures.

Section A(2): Liability.Coverserrorsandomissions,onaclaimsmadebasis,relatingtotheAssured’shandlingofphysical damageinsuranceandhomeowner’sinsurancecoveringtherealpropertyofborrowers. TheAssured’sdefence costs are also provided forwithinthe limits.

Section B(1): Realestatetaxliability.CoverstheAssuredagainsterrorsandomissions relatingto non-payment ofrealestatetax by the Assured on behalf ofaborrower.

Section B(2): Sectionsuspended as coverage incorporateinSectionF.

Section B(3): LifeandDisabilityinsurance.CoverstheAssuredagainsterrorsandomissionsarisingoutoftheAssured’s procurement and maintenance of lifeor disability insurance on behalf of a borrower.

Section B(4): FloodDisasterAct 1973liability.Coversthe AssuredagainsterrorsandomissionsclaimsarisingoutofAssured’s duty to determine whether or not aparticular property is in afloodzone.

Section B(5): GNMAprocedures.CoverstheAssured,asmortgageservicer,againsterrorsandomissionsshouldtheAssured fail tocomplywith GNMAprocedures which result in aguaranteebeinglost.

Section B(6): TitleErrorsOmissionsliability.CoverserrorsandomissionsarisingoutoftheBank’sfailuretoobtainthe correct title insurance, or a title abstractor legal opinion as toa title depending oncustomand practice.

Section B(7): RecordationErrorsOmissions.CoverserrorsandomissionsarisingoutoftheBank’srecordationofaloanasa servicerofa loansold to GNMA/FNMA/FHLMC

Section B(8): SatisfactionofMortgageliability.CoverserrorsandomissionsarisingoutoftheBank’sconnectionwiththe satisfaction of amortgage on property in whichthe Assuredholdsaninsurableinterest.

(Section B coveragesareona ‘claimsmade’basis and, inaddition,provide for the Assured’sdefence costs, withinthe limits) Section C: PhysicallossordamagefromBalanceofPerils. Providesinsuranceshouldthesecurityfortheloansuffera

physicallossfromanyothercauseotherthanoutlinedinA(1),andtheAssuredbeunabletorecovertheloanfrom the borrower.

Section F: LossofVeteransAdministration,FederalHousingAdministration,SmallBusinessAdministrationandprivate mortgageguaranteecoverage.Coverslosstothe Assured’sinterestshould hefailtoprovidetoa‘mortgage guarantee’ agency orInsurance Company its property notice ofloans inarrears.

SectionG:Lossof Security Interest dueto Defective Title.

Section H: CustodialErrorsandOmissions.Lossesincurredduetotheverification,certification,maintenanceandcustody of documentsconcerningloanssoldto GNMA, FNMA or FHLMC

All sections subject tothetermsand exclusionsof the policy.

PLEASE COMPLETE ALL PARTS OF THIS APPLICATION. Part 1: General Questions

Note: Policies willbe issuedin thejointnameoftheapplicantandany‘servicing’subsidiaryscheduledbelow.

1.Nameof applicant:

2.Address:

3.YearEstablished:Charter: State Federal National

4.Typeofinstitution(i.e.SavingsandLoan–MemberofSavingsandLoanLeague;Federal/Commercial/National

SavingsBank;Mortgage Bank;orother):

5.Majoraffiliations(i.e. National Savings and LoanLeague/StateSavingsand LoanAssociation):

Part 2: Questions concerning the Applicant’s Mortgage Portfolio

Note:‘Applicant’istobeunderstoodas applicantplusservicingsubsidiarynamedinPart1.

‘Value’should,wherepossible,excludethevalueofloanssecuredsolelybyland.

Forthepurposeofthisinsurance‘Mortgage’includes‘HomeEquityLoans’and‘2ndMortgages’

1.Doesapplicant’sstandardmortgageagreementrequireborrowerstoprocureandmaintaininsuranceinan amountofnotlessthantheamount of applicant’smortgageinterestforaminimumoftheperilsoffireand extended coverageand in compliance withany commercial policy coinsurance clause?  Yes  No

2.Does theapplicantrequire beingnamedasmortgageeonthe mortgagor’s insurancepolicy?  Yes No

3.Does the applicantrequirehazardpoliciesformortgagedproperties tobeprovided byinsurance companieswitha rating of atleast B fromBest’s policyholderratings?  Yes  No

4.ForLoansserviced on the applicant’s behalf byothers,does the applicantrequirethat Servicers carrytheirown E

& O Insurance? Yes No

5.What istheaveragelifeof the applicant’s recently paid up loans?

6.Doestheapplicant check that insurance requiredof themortgagorisin forceat loan closing?Yes  No

7.Doestheapplicantcheckthatinsuranceisinplaceatpolicyanniversary?

 Yes No

8.Doestheapplicant' “forceplace” coveragewhen necessary?HazardInsurance Yes No

Flood Insurance Yes No

Name ofCarriers:

Describe the method of tracking used:

9.Doestheapplicant’sforcedplacedprogram includethe“AutomaticCoverage Endorsement”?

 Yes No

10.Providethenumberofforeclosurescompletedandthenumberofmortgagesoutstandingforeachofthelastthree calendaryears:

Total Numberof

Mortgages Outstanding

Year ended :

Number of

Foreclosures

Average Balance of

Loans Foreclosed

Year ended :

Year ended :

11.Overthepast12 months, what was theaveragelength of timepriorto saleof foreclosed property:

12.Provideaverage percentageof mortgagesthat were90 daysor more delinquent overthepast12 months:

13.EstimatedNumberand Value of Loanoriginationsoverthenext12 months,brokendownasfollows:

Residential (1 –4Family)mortgages:

NumberValue

Commercial Mortgages:

14.BREAKDOWNOFALLMORTGAGES(INCLUDINGCOMMERCIAL,2NDSAND HOMEEQUITYLOANS)

(a) Number of mortgagesserviced by applicantfor own interest (wholly owned or part owned):

NumberValue

(b) Number of mortgagesserviced by applicantfor others

(nomortgageinterest):

(c) Number of mortgagesserviced by others for

applicant’sinterest (wholly or part owned):

(d) Total number of mortgages both ownedand

non-owned butserviced (i.e.(a) + (b) + (c) ):

15.NumberandvalueofALLloans as shownin14. (d) above that arelocatedin:

Florida

NumberValue

Alabama % in1sttier Coastal Counties Connecticut % in 1sttier Coastal Counties Delaware % in1sttier Coastal Counties Georgia % in1sttier Coastal Counties

Louisiana % in1sttier Coastal Counties

Maine % in1sttier Coastal Counties Maryland % in 1sttier Coastal Counties Massachusetts % in1sttier Coastal Counties Mississippi % in1sttier Coastal Counties New Hampshire % in1sttier Coastal Counties New Jersey % in1sttier Coastal Counties New York % in 1sttier Coastal Counties North Carolina % in 1sttier Coastal Counties RhodeIsland % in 1sttier Coastal Counties SouthCarolina % in 1sttier Coastal Counties Texas % in1sttier Coastal Counties

Virginia % in 1sttier Coastal Counties

16.

COMMERCIALMORTGAGES ONLY:

NumberValue

17.

2NDMORTGAGESANDHOME EQUITYLOANS:

NumberValue

18.

MOBILE HOMESONLY:

NumberValue

19.

MORTGAGES IN EXCESS OF$1,000,000:

Number

20.

The OutstandingBalance ofthefive largestloans:1

23

45

21.ApproximatepercentageofservicedloanssubjecttoVA, FHA, SBA orotherMortgageGuarantee Insurance:

22.What procedures arefollowed togiveproper noticeof delinquency tomortgageguarantors?

23.Stateapproximatepercentage numberofloanson which applicant“escrows” for:

(a)Hazard Insurance (b) Life and Disability (c) Real Estate Taxes

24.What procedures doestheapplicant employ tomonitorpaymentof RealEstateTaxes?

25.Hastheapplicant agreed toundertakeanyCustodial Services forFHLMC,FNMA and/or GNMA?

 Yes No

If“yes”, providethe following:

(d) Description ofthe location, fire protection, &security provided by applicant for these files.

(e) Details of back-up records inexistence incase of loss to the originalfiles.

(f) Details of howthe applicantcontrols and tracksfile access, removal &return.

26.Doestheapplicant requiremortgagorsto obtain Title Insuranceand/orthe equivalent,asappropriateto local practice,atloanclosing?  Yes  No

Ifyes,provide thefollowing:

(a) Percentageof loanson whichevidence isrequiredat loanclosing:

(b) Description ofthese requirements.

(c) Description ofapplicant’s loan policy provisionswith respect toTitle examinations / searches.

(d) Estimatednumber ofmortgage loansto be madein the next12 months:

Part 3: Geographical Breakdown of Loans

Notes:Includeinthefollowingthoseloansinwhich theapplicanthasamortgageinterest(whollyorpartowned)only(i.e.Loansdeclared inPart2Q14(a)+(c)only)

DONOTINCLUDELOANS OWNEDBYOTHERTHANTHEAPPLICANT.

“Value”should,wherepossible,exclude the valueof loans secured solely by land.

1.Total numberof mortgages(whollyor partially owned)numberedinPart2Q14(a)+(c)

2.Total valueof mortgages(wholly or partially owned) numberedinPart2Q14(a)+(c)

3.Area divisionof mortgagesnumberedandvalued above:

NumberValue

(a) All States–excludingthoseStatesset out separately below:

(b) North Carolina, South Carolina,Georgia, Florida, Alabama, Mississippi, Louisiana & Texas

(c) Tennessee

(d) Arkansas

(e) Missouri

(f) Kentucky

(g) Washington

(h) Oregon

(i) CALIFORNIACOUNTIES,including:

i.SanFrancisco,San Mateo

ii.ContraCosta,Alameda

iii.Del Norte, Humbold,Lake, Marin,Mendocino, Napa, Solano, &Sonoma

iv.Monterey,SanBenito,SantaCruz,SantaClara

v.LosAngeles

vi.Orange

vii.Kern, St.LuisObispo,SantaBarbara,Ventura

viii.SanDiego

ix.Alpine, Imperial,Inyo, Mono,Riverside, SanBernadino

x.All other counties not includedin i toixabove

(j) Hawaii

(k) Alaska

(l) PuertoRico

(m)Other(pleasespecify)

Part 4: Coverage Required

Part 5: Previous Mortgage Protection Policy

Carrier:

Limit ofLiability:

Deductible:

PolicyPeriod:

Premium:

Part 6: Declaration

1.Hastheapplicant madeapplication for insuranceunder any of thesections of the Policy hadbeendeclined?

 Yes No

If “yes”,statecircumstances:

2.Hastheapplicantsufferedanylossesduringthepastfiveyearsoristheapplicantawareofanycircumstanceslikelyto give risetoa lossunderanySectionofthePolicy?  Yes  No

If “yes”,givedetails:

I/We herebydeclare thattheabove statementsand particularsaretrue, that I.we have not suppressedor mis-statedany material factsand I/we agree that thisProposal Form shall bethebasis of theContract withUnderwriters.

(Signatureandtitle ofOfficer)(Date)