March 1, 1997
Xxxxx Xxxxxx
AmerUs Life
000 Xxxxx Xxxxxx
Xxx Xxxxxx, XX 00000
RE: Master Commitment for the Purchase of Residential Mortgage Loans
Dear Xxxxxxxxxxxxx:
This letter and the exhibits represent an agreement (the "Master Commitment")
between AmerUs Mortgage ("Seller") and AmerUs Life ("Purchaser"). Under this
Master Commitment, Seller and Purchaser agree to the one hundred percent
whole loan sale and purchase of first lien residential mortgage loans. The
total amount of the Master Commitment will be $200,000,000. The terms and
conditions of this Master Commitment will expire on March 1, 1998, or upon
the delivery and purchase of the Master Commitment amount. The mortgage loans
must meet the terms and conditions as stated on the attached appendices.
SECTION 1. LOAN PROGRAMS.
Eligible loan programs are identified on the attached appendices. Other loan
programs may be added to this Commitment from time to time by letter
agreement between Seller and Purchaser.
SECTION 2. UNDERWRITING GUIDELINES.
Section 2a. DELEGATED UNDERWRITING APPROVAL BY SELLER. Seller shall receive
delegated underwriting authority, in accordance with the terms and guidelines
of this Master Commitment. Seller acknowledges and agrees that its
underwriting will conform to prudent and sound underwriting practices.
Purchaser may, at its sole option, perform a separate credit evaluation at
the time the loan is submitted for loan purchase. All loans originated under
this Master Commitment shall have standard FHLMC or FNMA full or alternative
documentation and shall generally meet the underwriting guidelines specified
in the FHLMC SELLER/SERVICER GUIDE and FNMA SELLING AND SERVICING GUIDE,
unless exceptions to these guidelines are specified in the attached
appendices or given approval by Purchaser for a specified loan prior to its
closing.
Section 2b. COMPLIANCE. Seller represents and warrants to Purchaser that any
and all requirements of federal, state, or local law, rule, or regulation
applicable to any loan originated under this commitment have been complied
with, including but not limited to usury, truth-in-lending, real estate
settlement procedures, consumer credit protection, equal credit opportunity,
and disclosure laws. Seller shall deliver to Purchaser such evidence of
compliance with all such requirements that Purchaser may at its sole option
MASTER COMMITMENT PAGE 2
and from time to time require. Without limiting the foregoing, Seller
acknowledges and agrees that it is responsible for delivering to borrowers
all applicable Equal Credit Opportunity Act notices required in connection
with a loan.
SECTION 3. WEATHER RELATED, TAX AND INSURANCE ESCROWS.
Purchaser shall give Seller the option of waiving escrows for taxes and
homeowner's insurance if the loan-to-value ratio of the subject loan is less
than or equal to 80%. Purchaser shall allow weather related escrow holdbacks
under Seller's current escrow policies. Seller shall not waive escrows for
flood insurance or private mortgage insurance where such insurance is
required for any loan.
SECTION 4. PIPELINE OF LOANS.
Seller shall provide to Purchaser at least monthly, but no more frequently
than weekly, a Pipeline Report of all unfunded loans registered under this
Master Commitment. At minimum this report shall include lock/float status,
current interest rate and price, approval status, and projected closing date.
At request of Purchaser, Seller shall provide separate tracking and reporting
of loans or product types deemed higher risk, for purposes of limiting
Purchaser's obligation to purchase such loans to a percentage of the
Commitment amount as specified in the attached appendices or as Purchaser and
Seller shall from time to time agree.
SECTION 5. LOAN DELIVERY, REVIEW AND FUNDING.
Section 5a. DELIVERY AND FUNDING. Seller shall deliver a Schedule of Loans to
Purchaser for review and funding on a date each month mutually agreed upon by
Seller and Purchaser, but no more than forty-five days following the closing
date of the loans. Purchaser will purchase each eligible loan within five
business days of receipt of the Schedule of Loans. Any loan which is not
eligible for purchase will be suspended and Seller shall have thirty days to
cure the suspended loan and resubmit it for purchase.
Purchaser shall fund all mortgage loans at its committed price. Pricing shall
be established by Seller subject to review and approval of Purchaser and
according to the methodology specified in the attached appendices. All
funding amounts shall be net of any fees or accrued interest owed to
Purchaser by Seller.
Section 5b. DELIVERY AND FUNDING DOCUMENTS. At the time of loan delivery,
Seller's Warehouse Lender shall submit a Schedule of Mortgage Loans to
Purchaser which shall list all security instruments and mortgage loan
documents required for funding that are held by Seller or Seller's Warehouse
Lender as collateral of the mortgage loans, and which will be delivered to
Purchaser at the time of loan funding. The following documents will be
required for funding: the original mortgage note endorsed without recourse to
Purchaser, a certified copy of the assignment of mortgage made to Purchaser,
a certified copy of the interim assignment to Seller (if applicable), the
private mortgage
MASTER COMMITMENT PAGE 3
insurance certificate (if applicable), a certified copy of the mortgage or
deed of trust, and a title commitment or a preliminary title opinion. The
Loan File, which shall be understood to contain all original credit, income,
employment, and collateral documentation used to originate, underwrite, and
close the mortgage loan, including but not limited to the original credit
report, property appraisal, and Seller's Application Approval Certificate,
will be held by Seller for purposes of servicing the loans.
Section 5c. FINAL DOCUMENTS. Recorded mortgages, assignments and final title
policies or opinions will be tracked and received by Xxxxxx as custodian for
Purchaser. Seller shall provide to Purchaser within two hundred and seventy
days of the date which Purchaser funds the mortgage loan a Final Documents
Certification Schedule which shall indicate all final documents held by
Seller on behalf of purchaser.
SECTION 6. SERVICING RIGHTS.
The servicing rights and related escrow accounts to all loans originated
under this Commitment shall be retained by Seller. Seller and Seller's
sub-servicer shall perform all servicing functions on behalf of Purchaser in
a prudent and sound fashion and in accordance with generally accepted
accounting principles, and shall generally meet the servicing and accounting
guidelines specified in the FHLMC SELLER/SERVICER GUIDE or FNMA SELLING AND
SERVICING GUIDE, unless exceptions to these guidelines are specified in the
attached appendices. Servicing fees will be established for each program on
the attached appendices.
SECTION 7. WARRANTIES AND REPRESENTATIONS OF SELLER.
Seller hereby warrants and represents to Purchaser as follows:
Section 7a. ORGANIZATION AND GOOD STANDING. Seller is a duly organized,
validly existing corporation in good standing under the laws of the State of
Iowa.
Section 7b. AUTHORITY AND CAPACITY. Seller is duly licensed or empowered by
any and all agencies or governing bodies having appropriate jurisdiction and
authority to originate, service and sell residential mortgage loans under the
terms of this Master Commitment. Seller has all the requisite power,
authority, and capacity to enter into this Master Commitment and to perform
the obligations required of it hereunder, including, but not limited to, the
power and authority to transfer all right, title and interest in the mortgage
loans and the related documents. The execution of this Master Commitment has
been duly authorized, and the Master Commitment constitutes a legal, valid,
and binding obligation of Seller, enforceable against it in accordance with
its terms.
Section 7c. EFFECTIVE AGREEMENT. The execution and performance of this Master
Commitment by Xxxxxx, and the consummation of the transactions contemplated
herein, will not violate any provision of law applicable to Seller, and do
not and will not conflict with any of the terms of Seller's articles of
incorporation, charter, bylaws or other
MASTER COMMITMENT PAGE 4
governing instrument relating to the conduct of its business or ownership of
its properties, or any other agreement, order or instrument to which Seller
is a party of by which it is bound.
Section 7d. COMPLIANCE WITH CONTRACTS AND REGULATIONS. Seller has complied
with all of its obligations under all contracts which relate to the
origination and servicing of mortgage loans, and with all applicable laws,
regulations, and policies, including, without limitation, those of the Federal
Housing Administration, the Veterans Administration, FNMA, FHLMC, or private
mortgage insurers, with respect to any of the loans originated and serviced
by Seller under this Master Commitment.
Section 7e. TITLE TO LOANS, SERVICING RIGHTS AND RELATED ESCROW ACCOUNTS.
Seller is the lawful owner of the loans, the servicing documentation, and
escrow accounts relating to the loans. As of Seller's delivery of the loan
documents to the Purchaser and the Purchaser's funding date, the loans, the
loan documentation, and the servicing rights to the loans, shall be free and
clear of any and all liens, claims, charges, defenses, offsets, pledges, and
encumbrances of any kind or nature whatsoever.
Section 7f. ACCURACY AND COMPLETENESS OF LOAN DOCUMENTATION. Seller certifies
that all documents and all copies of documents provided to Purchaser
concerning any loan purchased shall be accurate, complete, and genuine.
SECTION 8. WARRANTIES AND REPRESENTATIONS OF PURCHASER.
Section 8a. ORGANIZATION AND GOOD STANDING. Purchaser is a duly organized,
validly existing corporation in good standing under the laws of the State of
Iowa.
Section 8b. AUTHORITY AND CAPACITY. Purchaser is duly licensed or empowered
by any and all agencies or governing bodies having appropriate jurisdiction
and authority to purchase residential mortgage loans under the terms of this
Master Commitment. Purchaser has all the requisite power, authority, and
capacity to enter into this Master Commitment and to perform the obligations
required of it hereunder, including, but not limited to, the power and
authority to assume all right, title, and interest in the mortgage loans and
related documents. The execution of this Master Commitment has been duly
authorized, and the Master Commitment constitutes a legal, valid and binding
obligation of Purchaser, enforceable against it in accordance with its terms.
Section 8c. EFFECTIVE AGREEMENT. The execution and performance of this Master
Commitment by Purchaser, and the consummation of the transactions
contemplated herein, will not violate any provision of law applicable to
Purchaser, and do not and will not conflict with any of the terms of
Purchaser's articles of incorporation, charter, bylaws or other governing
instrument relating to the conduct of its business or ownership of its
properties, or any other agreement, order or instrument to which Purchaser is
a party or by which it is bound.
MASTER COMMITMENT PAGE 5
SECTION 9. NOTICES.
All notices, requests, demands, and other documentation or communications
which are required or permitted to be given under this Master Commitment
shall be in writing and shall be deemed effective upon receipt and addressed
to the following or to such other addresses as may be furnished from time to
time by either party:
(a) If to the Seller:
Xxxxx Xxxxxx
Senior Vice President
AmerUs Mortgage
0000 00xx Xxxxxx Xxxxx 000
Xxxx Xxx Xxxxxx, XX 00000
(b) If to the Purchaser:
Xxxxx Xxxxxx
AmerUs Life
000 Xxxxx Xxx.
Des Moines, IA 50309
SECTION 10. TERMINATION.
This Master Agreement may be terminated by either Seller or Purchaser by
giving written notice not less than sixty calendar days prior to the
effective date of such termination. Such termination shall not in any manner
affect either Seller's or Purchaser's respective duties, obligations,
covenants, representations, or warranties with regard to loans previously
originated or purchased; nor shall the termination affect the purchase of
loans by Purchaser for which Seller has issued a Rate and Price Commitment,
taken a loan application under a Loan Program offered under this Master
Commitment, or given loan underwriting approval prior to or on the date of
such notice of termination or the termination date.
SECTION 11. WAIVERS, AMENDMENTS AND ADDENDA.
Either the Purchaser or the Seller may, by written notice to the other and
upon mutual acceptance by both parties:
(a) Extend the time for the performance of any of the obligations
of or transactions by the other;
(b) Waive compliance with any of the terms, conditions or
covenants required to be complied with by the other; or
(c) Waive or modify performance of any of the obligations of the
other under this Master Commitment.
MASTER COMMITMENT PAGE 6
Any amendments or addenda to this Master Commitment or the obligations of the
Purchaser or the Seller pursuant to this Master Commitment shall be effective
only if executed in writing by both parties.
SECTION 12. ENTIRE AGREEMENT.
This Master Commitment, including all Exhibits and Appendices, constitutes
the entire agreement between the parties, and supersedes all other
agreements, understandings, representations, and negotiations with respect to
this Master Commitment, whether oral or written.
SECTION 13. BINDING EFFECT.
This Master Commitment shall inure to the benefit of and be binding upon the
parties hereto and their successors and permitted assigns, but neither the
Master Commitment nor any of the rights, interests, or obligations under
this Master Commitment shall be assigned by either party without the prior
written consent of other party.
SECTION 14. ACCEPTANCE AND ACKNOWLEDGMENT OF MASTER COMMITMENT.
The authorized officers of AmerUs Mortgage and AmerUs Life have executed this
Master Commitment as of the date first written above.
AmerUs Mortgage AmerUs Life
By: \s\ Xxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxx
----------------------- ------------------------
Xxxxx X. Xxxxxx Xxxxxx Xxxxxx
Its Senior Vice President and Its Portfolio Manager
Risk Manager
MASTER COMMITMENT PAGE 7
APPENDIX I: ELIGIBLE PRODUCTS
AmerUs Agency 5/1 ARM
AmerUs Agency 7/1 ARM
AmerUs Nonagency 5/1 ARM (95%)
AmerUs Nonagency 7/1 ARM (95%)
MASTER COMMITMENT PAGE 8
APPENDIX II: SERVICING FEES AND PRICING
I. SERVICING FEES: Purchaser shall pay Seller an annual servicing fee of
0.25% of the unpaid principal balance of the loans originated under this
commitment during the initial fixed interest rate period of the loans.
Commencing on the first Change Date of each loan, the servicing fee shall be
0.375%.
II. PRICING: Pricing for all loans originated under this Commitment shall be
set daily by Seller. A base (par) rate shall be established as the par
equivalent FHLMC 60-day MBS rate for five and seven year balloons, plus
0.25%. The maximum price shall be 101.00. Buy-ups and buy downs shall be
calculated according to the following schedule. The base rate shall apply to
all conforming agency-quality loans. All nonagency and jumbo loans shall be
originated at a rate equal to the base plus 0.125%.
PRICE SCHEDULE
Rate Differential Corresponding BD/BU Ratio
(from Par Rate) Price (Price/Rate)
-------------------------------------------------------------
-1.000 97.000 3.0/1
-0.875 97.375 3.0/1
-0.750 97.750 3.0/1
-0.625 98.125 3.0/1
-0.500 98.500 3.0/1
-0.375 98.875 3.0/1
-0.250 99.250 3.0/1
-0.125 99.625 3.0/1
Base 100.000 3.0/1
0.125 100.375 3.0/1
0.250 100.625 2.5/1
0.375 101.000 2.5/1
March 11, 1997
Xxxxx Xxxxxx
Vice President
AmerUs Life
000 Xxxxx Xxxxxx
Xxx Xxxxxx, XX 00000
Re: Amendments to Master Commitment for the Purchase of Residential Mortgage
Loans
Dear Xxxxx:
This Letter Agreement shall represent an addendum to the Master Commitment
dated March 1, 1997, between AmerUs Mortgage ("Seller") and AmerUs Life
("Purchaser") and shall be deemed to amend and supplement that Commitment. In
addition to the representations, warranties, and covenants and despite
anything to the contrary in the Master Commitment, Seller and Purchaser agree
as follows:
I. COMMITMENT EXPIRATION. The Master Commitment shall expire on December 31,
1997, or a date prior to that date if mutually agreed upon by Seller and
Purchaser.
II. MODIFIED PRODUCTS. The Nonagency 5/1 and 7/1 ARM products described on
the attached product descriptions shall be eligible for sale under this
Commitment.
The authorized officers of AmerUs Mortgage and AmerUs Life have executed this
Letter Agreement as of the date first written above.
AmerUs Mortgage AmerUs Life
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxx Xxxxxx
------------------------------- ------------------------
Xxxxx X. Xxxxxx Xxxxx Xxxxxx
Its Senior Vice President and Its Vice President and
Risk Manager Portfolio Manager
attachments
SUBJECT: NONAGENCY 5/1 & 7/1 ARM
[logo] SECTION: SPECIAL AMERUS PRODUCTS
PAGE NUMBER: 3.3.1
PREPARED BY: XXXXX XXXXXX
APPROVED BY: XXXXX XXXXXX
DATE: 10 MARCH 1997
------------------------------------------------------------------------------
SUMMARY This program offering features conforming and nonconforming
ARMs for up to 95% LTV. These loans feature low first
adjustment caps, and convertible loans feature a low
conversion margin as well. All loans will be purchased by
AmerUS Life for portfolio investment.
AVAILABILITY This program is available for retail and wholesale
originations.
ELIGIBLE The 5/1 and 7/1 ARMs are eligible for this program. The 5/1
PRODUCTS product has a 2.00% first adjustment cap, 2.00% periodic
cap, and 5.00% lifetime cap. The 7/1 has a 5/00% first
adjustment cap, 2.00% periodic cpa, and 5.00% lifetime cap.
Both products are indexed to the one-year Treasury Bill,
with a 2.75% margin. These ARMs are not assumable within the
initial fixed period; after the first adjustment the loan may
be assumed with the consent and under the conditions of the
note holder.
CONVERTIBILITY Conforming loans have a conversion option. The conversion
option may be exercised on the first, second, or third
interest rate change date. The converted rate is equal to
0.375% over the FNMA 60-day required net yield in effect
45 days prior to conversion, rounded to the nearest 0.125%.
The conversion fee is $250.00.
LOCK OPTIONS This product will be priced daily. Standard locks are
available for 60 or 90 day periods, with no lock fees.
Extended locks with float-down options are not available for
this product.
OCCUPANCY Amount Purchase No Cash Cash Out
--------- ------ -------- ------- --------
LTV AND LOAN 1-2 Unit Principal $350,000 95% 90% 75%
AMOUNTS LIMITS Residence $400,000 90% 80% 75%
$500,000 85% 80% 75%
1 Unit Second $400,000 90% 80% 65%
Home
Investor and 3-4 unit properties are not eligible.
ELIGIBLE Single family attached, single family detached, multi-family
PROPERTIES 2-unit, condominiums and PUDs. All properties must meet
agency collateral standards.
TERM All loans must be written for 20, 25 or 30 year terms only.
SUBORDINATE Subordinate financing is not acceptable.
FINANCING
PMI Private mortgage insurance is required on all loans with
LTVs greater than 80%
UNDERWRITING All loans must be underwritten to agency guidelines except
GUIDELINES where specified otherwise in this document.
NONAGENCY 5/1 & 7/1 PAGE 3.3.2
QUALIFYING RATE The borrower may be qualified at the note rate in all
cases. There is no qualifying floor.
TEMPORARY Temporary buydowns with a 3-2-1 or 2-1-0 schedule are
BUYDOWNS allowed in this program. The borrower may be
qualified at 2.00% below the note rate for principal
residences. Second homes qualify at the note rate.
ESCROWS Escrows for taxes and insurance are required, but may
be waived for a 0.25% increase in price.
DOCUMENTATION Both full and alternate documentation are available
REQUIREMENTS-- for this program.
APPLICATION
DOCUMENTATION Note: FNMA/FHLMC 3522
REQUIREMENTS-- Rider: FNMA/FHLMC 3182
CLOSING Mortgage/Deed of Trust: Conventional State-Specific
DISCLOSURES In addition to standard Truth-in-Lending and RESPA
disclosures, the applicant must be provided with an ARM
5/1 or 7/1 loan program disclosure and a copy of the
Adjustable Rate Mortgage Consumer Handbook at the time
of application.
SYSTEM CODES
