29
EXHIBIT 10.1
FIFTH AMENDMENT TO
------------------
FIRST AMENDED AND RESTATED
--------------------------
WAREHOUSING CREDIT AND SECURITY AGREEMENT
-----------------------------------------
THIS FIFTH AMENDMENT TO FIRST AMENDED AND RESTATED WAREHOUSING CREDIT
AND SECURITY AGREEMENT (this "Amendment") is entered into as of this 28th
day of August 1997, by and between U.S. HOME MORTGAGE CORPORATION, a
Florida corporation (the "Company"), and RESIDENTIAL FUNDING CORPORATION, a
Delaware corporation (the "Lender").
WHEREAS, the Company and the Lender have entered into a single family
revolving warehouse facility with a present Commitment Amount of Sixty-Five
Million Dollars ($65,000,000), to finance the origination and acquisition
of Mortgage Loans as evidenced by a Third Amended and Restated Warehousing
Promissory Note in the principal sum of Sixty-Five Million Dollars
($65,000,000), dated June 25, 1997, and a Warehousing Credit and Security
Agreement dated August 31, 1995, as the same may have been amended or
supplemented (the "Agreement");
WHEREAS, the Company has requested the Lender to extend the period for
which the Commitment under the Agreement has been made and to amend certain
other terms of the Agreement, and the Lender has agreed to such extension
and amendment subject to the terms and conditions of this Amendment;
NOW, THEREFORE, for and in consideration of the foregoing and of the
mutual covenants, agreements and conditions hereinafter set forth and for
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:
1. All capitalized terms used herein and not otherwise defined shall
have their respective meanings set forth in the Agreement.
2. The effective date ("Effective Date") of this Amendment shall be
08-28-97, the date on which the Company has complied with all the terms
and conditions of this Amendment.
3. Section 1.1 of the Agreement shall be amended by adding the
following definitions in the appropriate alphabetical order:
"Designated Bank Charges" means any fees, interest or other
charges that would otherwise be payable to a Designated Bank,
including Federal Deposit Insurance Corporation insurance premiums,
service charges and such other charges as may be imposed by
governmental authorities from time to time.
30
"High LTV Mortgage Loan" means a Mortgage Loan of which the sum
of the maximum amount available to be borrowed thereunder (whether or
not borrowed), at the time of origination plus the Mortgage Note
Amounts of all other Mortgage Loans secured by the related improved
real property exceeds one hundred percent (100%) of the appraised
value of such related improved real property.
"Manufactured Home" means a structure that is built on a
permanent chassis (steel frame) with the wheel assembly necessary for
transportation in one or more sections to a permanent site or
semi-permanent site and which has been built in compliance with the
National Manufactured Housing Construction and Safety Standards
established by HUD.
4. Section 1.1 of the Agreement shall be amended to delete the
definitions of "Conventional Mortgage Loan," "Eligible Balances," "Home
Equity Loan," "Maturity Date," "Mortgage," "Mortgage Note Amount,"
"Nonconforming Mortgage Loan" and "Second Mortgage Loan" in their entirety,
replacing them with the following
definitions:
"Conventional Mortgage Loan" means a closed-end First Mortgage
Loan other than an FHA insured Mortgage Loan, a VA guaranteed Mortgage
Loan, an FmHA guaranteed Mortgage Loan or a High LTV Mortgage Loan.
"Eligible Balances" means all funds of or maintained by the
Company and its Subsidiaries in accounts at a Designated Bank, less
balances to support float, reserve requirements, and such other
reductions as may be imposed by governmental authorities from time to
time.
"Home Equity Loan" means an open-ended revolving line of credit
that is a Mortgage Loan secured by either a First Mortgage or a Second
Mortgage, which is not a High LTV Mortgage Loan or a Title I Mortgage
Loan.
"Maturity Date" shall mean the earlier of: (a) the close of
business on August 31, 1998, as such date may be extended from time to
time in writing by the Lender, in its sole discretion, on which date
the Commitment shall expire of its own term, and without the necessity
of action by the Lender, and (b) the date the Advances become due and
payable pursuant to Section 8.2 below.
"Mortgage" means a first mortgage or first deed of trust on
improved real property (including, without limitation, real property
to which a manufactured home has been affixed in a manner such that
the Lien of a mortgage or deed of trust would attach to such
manufactured home under applicable real property law).
"Mortgage Note Amount" means, as of the date of determination,
the then outstanding unpaid principal amount of a Mortgage Note
(whether or not an additional amount is available to be drawn
thereunder).
31
"Nonconforming Mortgage Loan" means a Conventional Mortgage Loan
which is not a Conforming Mortgage Loan or a Jumbo Mortgage Loan,
which has a credit risk rating C- or better (determined using
underwriting standards which comply with industry standards in the
sole judgment of the Lender), and which is underwritten and approved
for purchase by an Investor prior to funding if its original principal
amount exceeds Six Hundred Thousand Dollars ($600,000).
"Second Mortgage Loan" means a closed-end Mortgage Loan secured
by a Second Mortgage, which is not a Title I Mortgage Loan or a High
LTV Mortgage Loan.
5. Section 2.1(b)(3) of the Agreement shall be deleted in its entirety
and the following is substituted in lieu thereof:
(3) No Advance shall be made against a High LTV Mortgage
Loan, a Home Equity Loan, a Second Mortgage Loan, a Title I
Mortgage Loan or a HUD
203(K) Mortgage Loan.
6. Section 2.2(c) of the Agreement shall be amended to add the
following sentence to the end thereof:
"The Lender shall have no obligation to make a Wet Settlement Advance
directly to the Parent against a Mortgage Loan unless the Lender has
received satisfactory evidence from the title company closing the
Mortgage Loan that such Mortgage Loan is closed and funded."
7. Section 2.4(d) of the Agreement shall be deleted in its entirety
and the following shall be substituted in lieu thereof:
2.4(d) The Company is entitled to receive a benefit in the form
of an "Earnings Credit" on the portion of the Eligible Balances
maintained in time deposit accounts with a Designated Bank, and the
Company is entitled to receive a benefit in the form of an "Earnings
Allowance" on the portion of the Eligible Balances maintained in
demand deposit accounts with a Designated Bank. Any Earnings Allowance
shall be used first and any Earnings Credit shall be used second as a
credit against accrued Designated Miscellaneous Charges and fees,
including, but not limited to Commitment Fees, Usage Fees and
Warehousing Fees, and may be used, at the Lender's option, to reduce
accrued interest. Any Earnings Allowance not used during the month in
which the benefit was received shall be accumulated for use and must
be used within six (6) months of the month in which the benefit was
received. Any Earnings Credit not used during the month in which the
benefit was received shall be used to provide a cash benefit to the
Company. The Lender's determination of the Earnings Credit and the
Earnings Allowance for any month shall be determined by the Lender in
its sole discretion and shall be conclusive and binding absent
manifest error. In no event shall the benefit received by the Company
exceed the Depository Benefit.
32
Either party hereto may terminate the benefits provided for in
this Section effective immediately upon Notice to the other party, if
the terminating party shall have determined (which determination shall
be conclusive and binding absent manifest error) at any time that any
applicable law, rule, regulation, order or decree or any
interpretation or administration thereof by any governmental authority
charged with the interpretation or administration thereof, or
compliance by such party with any request or directive (whether or not
having the force of law) of any such authority, shall make it unlawful
or impossible for such party to continue to offer or receive the
benefits provided for in this Section.
8. Section 2.4(g) of the Agreement shall be deleted in its entirety
and the following shall be substituted in lieu thereof:
2.4(g) Upon Notice to the Company, after the occurrence and
during the continuation of an Event of Default, the unpaid amount of
each Advance shall bear interest until paid in full at a per annum
rate of interest (the "Default Rate") equal to four percent (4%) in
excess of the rate of interest otherwise applicable to such Advance
pursuant to any other subsection of this Section 2.4 or, if no rate is
applicable, the highest rate then applicable to any outstanding
Advances.
9. Sections 2.5(d)(1) and (2) of the Agreement shall be deleted in
their entirety and the following shall be substituted in lieu thereof:
(1) For a Pledged Mortgage, other than a Construction
Mortgage Loan or an Unimproved Mortgage Loan, with respect to
which a shorter or longer period is not prescribed elsewhere in
this Section 2.5(d), one hundred twenty (120) days elapse from
the date of the initial Advance made by the Lender against such
Pledged Mortgage, whether or not such Pledged Mortgage is
included in an Eligible Mortgage Pool.
(2) Forty-five (45) days elapse from the date the Pledged
Mortgage was delivered to an Investor or an Approved Custodian
for examination and purchase or inclusion in an Eligible Mortgage
Pool, without the purchase being made or the Eligible Mortgage
Pool being initially certified, or upon rejection of the Pledged
Mortgage as unsatisfactory by an Investor or an Approved
Custodian.
10. Section 3.2(d) of the Agreement shall be deleted in its entirety
and the following shall be substituted in lieu thereof:
33
3.2(d) The Lender shall have the exclusive right to the
possession of the Pledged Securities or, if the Pledged Securities are
issued in book-entry form or issued in certificated form and delivered
to a clearing corporation (as such term is defined in the Uniform
Commercial Code of Minnesota) or its nominee, the Lender shall have
the right to have the Pledged Securities registered in the name of a
securities intermediary (as such term is defined in the Uniform
Commercial Code of Minnesota) in an account containing only customer
securities for the account of the Lender, and the Lender shall have
the right to cause delivery of the Pledged Securities to be made to
the Investor or the book entries registered in the name of the
Investor or the Investor's designee only against payment therefor. The
Company acknowledges that the Lender may enter into one or more
standing arrangements with other financial institutions for the
issuance of Pledged Securities in book entry form in the name of such
other financial institutions, as agent or securities intermediary for
the Lender, and the Company agrees upon request of the Lender, to
execute and deliver to such other financial institutions the Company's
written concurrence in any such standing arrangements.
11. Section 5.15 of the Agreement is hereby amended to add the
following section immediately after Section 5.15(i):
5.15(j) Each Pledged Mortgage secured by real property to which a
Manufactured Home is affixed will create a valid Lien on such
Manufactured Home that will have priority over any other Lien on such
Manufactured Home, whether or not arising under applicable real
property law.
12. Section 9 of the Agreement shall be amended to delete the
telecopier number of the Lender set forth therein and substitute telecopier
number "(000) 000-0000" in lieu thereof and all references in the Agreement
to the telecopier number of the Lender shall be deemed to refer to the new
telecopier number.
13. Upon execution of this Amendment, the Company agrees to pay to the
Lender the Commitment Fee on the Commitment Amount for the time period from
the Effective Date to and including September 30, 1997.
14. Exhibits C-SF, D-SF, C-SF/UNI, D/UNI, C-SF/CONSTRUCTION and
D-SF/CONSTRUCTION to the Agreement are hereby deleted in their entirety and
replaced with the new Exhibits C-SF, D-SF, C-SF/UNI, D-SF/UNI,
C-SF/CONSTRUCTION and D-SF/CONSTRUCTION attached to this Amendment. All
references in the Agreement to Exhibits C-SF, D-SF, C-SF/UNI, D/UNI,
C-SF/CONSTRUCTION and D-SF/CONSTRUCTION shall be deemed to refer to the new
Exhibits C-SF, D-SF, C-SF/UNI, D-SF/UNI, C-SF/CONSTRUCTION and
D-SF/CONSTRUCTION.
34
15. The Company shall deliver to the Lender (a) an executed original
of this Amendment; (b) an executed Certificate of Secretary with corporate
resolutions; (c) an executed Funding Bank Agreement; (d) a current
certified tax, lien and judgment search of the appropriate public records
for the Company, including a search of Uniform Commercial Code financing
statements, which search shall not have disclosed the existence of any
prior Lien on the Collateral other than in favor of the Lender or as
permitted hereunder; (e) current Certificates of Good Standing of the
Company; (f) current insurance information; (g) the Commitment Fee for the
month of September, 1997; and (h) a Five Hundred Dollar ($500) document
production fee.
16. The Company represents, warrants and agrees that (a) there exists
no Default or Event of Default under the Loan Documents, (b) the Loan
Documents continue to be the legal, valid and binding agreements and
obligations of the Company enforceable in accordance with their terms, as
modified herein, (c) the Lender is not in default under any of the Loan
Documents and the Company has no offset or defense to its performance or
obligations under any of the Loan Documents, (d) the representations
contained in the Loan Documents remain true and accurate in all respects,
and (e) there has been no material adverse change in the financial
condition of the Company from the date of the Agreement to the date of this
Amendment.
17. Except as hereby expressly modified, the Agreement shall otherwise
be unchanged and shall remain in full force and effect, and the Company
ratifies and reaffirms all of its obligations thereunder.
18. This Amendment may be executed in any number of counterparts and
by the different parties hereto on separate counterparts, each of which
when so executed and delivered shall be an original, but all of which shall
together constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and the Lender have caused this
Amendment to be duly executed on their behalf by their duly authorized
officers as of the day and year above written.
U.S. HOME MORTGAGE CORPORATION
By: Xxxxxx X. Xxxxxx
-----------------------------
/s/ Xxxxxx X. Xxxxxx
Its: Vice President
RESIDENTIAL FUNDING CORPORATION,
a Delaware corporation
By: Xxxxx X. Xxxx
----------------------------
/s/ Xxxxx X. Xxxx
Its: Director
35
STATE OF Texas )
) ss
COUNTY OF Xxxxxx)
On August 29, 1997, before me, a Notary Public, personally appeared
Xxxxxx X. Xxxxxx, the Vice President of U.S. HOME MORTGAGE CORPORATION,
a Florida corporation, personally known to me (or proved to me on the
basis of satisfactory evidence) to be the person whose name is subscribed
to the within instrument and acknowledged to me that he/she executed the
same in his/her authorized capacity, and that by his/her signature on the
instrument the person, or the entity upon behalf of which the person acted,
executed the instrument.
WITNESS my hand and official seal.
By: Xxxxx Xxxxxx
-------------------------
/s/ Xxxxx Xxxxxx
Notary Public
(SEAL) My Commission Expires: 00-00-00
XXXXX XX Xxxxxxx )
) ss
COUNTY OF Broward )
On September 2, 1997, before me, a Notary Public, personally
appeared Xxxxx Xxxx, the Director of RESIDENTIAL FUNDING CORPORATION,
a Delaware corporation, personally known to me (or proved to me on the
basis of satisfactory evidence to be the person whose name is
subscribed to the within instrument and acknowledged to me that he/she
executed the same in his/her authorized capacity, and that by his/her
signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.
WITNESS my hand and official seal.
By: Xxxxxx X. Xxxxxx
----------------------------
/s/ Xxxxxx X. Xxxxxx
Notary Public
(SEAL) My Commission Expires: 09-15-98
36
EXHIBIT C-SF
REQUEST FOR ADVANCE SINGLE FAMILY MORTGAGE LOAN
Mortgage Company: U.S. HOME MORTGAGE CORPORATION
Mortgagor:_________________________ Loan Number: __________________________
_________________________ Reviewed By: __________________________
Address: _________________________ Warehouse Date:__________________________
_________________________ Effective Date:__________________________
Status: Committed _______________ Loan Type: Conforming _______Jumbo_______
Uncommitted _____________ Nonconforming _______Grade____
Wet Settlement __________ VA ____________ FHA __________
Received ________________ FmHA _________________________
3rd Party Fixed __________ Term ________
Originated____________ ARM ____________ Type ________
Section 32_______________ Balloon _______ Type _________
Home Equity ____ High LTV_____
Second________ Title I ______
203(K) _______ RFC ___________
"D" Mortgage _________________
Mortgage Note Amount: _____________ Interest Rate: __________________________
Mortgage Note Date: _______________ Requested Warehouse Amt: ________________
Investor: _________________________ Expiration Date: ________________________
Purchase Commitment No: ___________ Title Company: __________________________
Committed Purchase Price: ___________
METHOD OF ADVANCE
-----------------
( ) Check Funding/Disbursement
Check No: ________________________ Amount: ___________________________
Checking Account No: _____________
( ) Wire Transfer
Amount of Wire: __________________ Date of Wire: _____________________
Credit Acct. No.: ________________ Credit Acct. Name: _________________
ABA No.: _________________________ Bank Name: __________________________
Account to Debit: ________________ City & State:_______________________
Ref: ________________ Advise: ___________________ Phone:_____________
37
REQUIRED DOCUMENTATION
----------------------
Attached please find the following documents in connection with the above
request (Please check attached documents below):
Right
( ) Original and one copy of Mortgage Note
( ) Certified copy of Mortgage
( ) Section 32 Compliance Documents (if applicable)
( ) *Copy of Investor Purchase Commitment (or satisfactory evidence thereof)
( ) *Copy of HUD-1 Settlement Statement or equivalent
(Home Equity Loans and Title I Mortgage Loans only)
( ) *HUD 203(K) Maximum Mortgage Worksheet (HUD 203(K) Mortgage Loans only)
Left
( ) *Request for Advance (original and one (1) copy)
( ) *Copy of settlement or funding check (if applicable)
( ) Recordable assignment of Mortgage
( ) Certified copies of interim assignments of Mortgage (if applicable)
( ) *Bailee Pledge Agreement (only required for Wet Settlement Advance)
( ) *Evidence from title company that Mortgage Loan is closed and funded
(only required if Wet Settlement Advance is directly to the Parent)
Please Note: Items designated with the "*" are required prior to a Wet
Settlement Advance.
Authorized Signature:____________________________________
38
EXHIBIT C-SF/UNI
REQUEST FOR ADVANCE UNIMPROVED MORTGAGE LOAN
Mortgage Company: U.S. HOME MORTGAGE CORPORATION
Mortgagor:_________________________ Loan Number:____________________________
_________________________ Reviewed By:____________________________
Address: _________________________ Warehouse Date:_________________________
_________________________
Property Type: Residential ____________________
Commercial _____________________
Original Mortgage Note Amount: _____________ Interest Rate: ________________
Mortgage Note Date: ________________________ Approved Warehouse Amt:________
Current Mortgage Note Amount: ______________ Title Company:_________________
Purchase Price for Property: ________________
Company Valuation of Property:* _____________
METHOD OF ADVANCE
-----------------
( ) Check Funding/Disbursement
Check No: ________________________ Amount: ___________________________
Checking Account No: _____________
( ) Wire Transfer
Amount of Wire: __________________ Date of Wire: _____________________
Credit Acct. No.: ________________ Credit Acct. Name: ________________
ABA No.: _________________________ Bank Name: ________________________
Account to Debit: ________________ City & State:______________________
Ref: ______________ Advise: _________________ Phone: __________________
REQUIRED DOCUMENTATION
----------------------
Attached please find the following documents in connection with the above
request (Please check attached documents below):
Right
( ) Original and one copy of Mortgage Note
( ) Certified copy of Mortgage or Deed of Trust
Left
( ) Request for Advance (original and one (1) copy)
( ) Recorded assignment of Mortgage or Deed of Trust, or Certified True Copy
of assignment sent for recording
( ) Recordable assignments of Security Agreement/financing statement; if any
( ) Certified copies of interim assignments of Mortgage (if applicable)
( ) Evidence from title company that Mortgage Loan is closed and funded
Authorized Signature:
------------------------------------
*Unimproved Mortgage Loans secured by property intended for commercial
development only.
39
EXHIBIT C-SF/CONSTRUCTION
REQUEST FOR ADVANCE SINGLE-FAMILY CONSTRUCTION/PERM MORTGAGE LOANS
Mortgage Company: U.S. HOME MORTGAGE CORPORATION
Mortgagor:_________________________ Loan Number: _________________________
_________________________ Reviewed By: _________________________
Address: _________________________ Warehouse Date:_________________________
_________________________ Effective Date:_________________________
Status: Committed ________________ Loan Type: ARM _________ Type ________
Wet Settlement __________
Received_________________
Mortgage Loan Type: Construction/Perm______
Mortgage Note Amount: _____________ Interest Rate:__________________________
Mortgage Note Date: _______________ Requested Warehouse Amount (Total):_____
Investor: _________________________ Warehouse Price: _______________________
Purchase Commitment No: ___________ Expiration Date: _______________________
Committed Purchase Price: _________ Title Company: _________________________
As Completed Appraised Value:_______________________________________________
Costs: Total___________ Acquisition/Land_________
Advance: Initial Construction:____________ Requested Amount: __________
Interim Construction:____________ Staged Draw #:______________
Final Construction:______________ Percentage of
Completion:_________________
METHOD OF ADVANCE
( ) Check Funding/Disbursement (for Initial Construction Advance only)
Check No._________________________ Amount: ___________________________
Checking Account No:__________________________________________________
( ) Wire Transfer
Amount of Wire: __________________ Date of Wire:______________________
Credit Acct. No.: ________________ Credit Acct. Name: ________________
ABA No.: _________________________ Bank Name:_________________________
City & State:______________________
Account to Debit: ________________
Ref: ________________ Advise: ___________________ Phone:_____________
40
REQUIRED DOCUMENTATION
----------------------
Attached please find the following documents in connection with the above
request (Please check attached documents below):
Initial Construction Advance
----------------------------
Right
( ) Original and one copy of Mortgage Note with Construction Rider(s), if any
( ) Certified copy of Mortgage with Construction Rider(s), if any
( ) *Certified copy of Construction/Building Loan Agreement including
construction draw schedule (Construction/Perm Mortgage Loans)
( ) Certified copy of ALTA Mortgagor's/Lender's Title Policy
( ) *Copy of Appraisal indicating the As Completed Appraised Value
( ) *Copy of Cost Breakdown
( ) *Copy of Purchase Commitment executed by Investor (if applicable)
( ) Copy of Company's Permanent Mortgage Loan commitment to mortgagor(s) Left
( ) *Request for Advance (original and one (1) copy)
( ) *Copy of settlement or funding check (if applicable)
( ) Recordable assignment of Mortgage
( ) Certified copies of interim assignments of Mortgage (if applicable)
( ) *Bailee Pledge Agreement (only required for Wet Settlement Advance)
( ) *Evidence from title company that Mortgage Loan is closed and the
initial construction advance has been funded (only required if Wet
Settlement Advance is directly to the Parent)
Construction Advances
In addition to the documentation required per "Initial Construction
Advance" above, the following Collateral Documents will be required to
support Construction Advances for Construction/Perm Mortgage Loans:
( ) Request for Advance (original and one (1) copy)
( ) Title update endorsement for previous Construction Advance, if applicable
( ) Title update endorsement for modification of construction Mortgage Loan
to permanent Mortgage Loan, if applicable, (Final Construction Advance
only)
( ) Copy of final survey (Final Construction Advance only)
( ) Purchase Commitment executed by Investor (Final Construction Advance only)
( ) Final appraiser's inspection (Final Construction Advance only)
( ) Evidence from title company that the construction advance has been funded
(only required if Wet Settlement Advance is directly to the Parent)
Please Note: Items designated with the "*" are required prior to a Wet
Settlement Advance.
Authorized Signature:
------------------------------------
41
EXHIBIT D-SF
PROCEDURES AND DOCUMENTATION FORWAREHOUSING SINGLE FAMILY MORTGAGE LOANS
The following procedures and documentation requirements must be
observed in all respects by the Company. All documents must be satisfactory
to the Lender in its sole discretion. Terms used below, which are not
otherwise defined, shall have the meanings given them in the Agreement. The
HUD, FNMA and FHLMC form numbers referred to herein are for convenience
only and the Company shall use the equivalent forms required at the time of
delivery of the Mortgage Loans or Mortgage-backed Securities. All Requests
for Advance and Collateral Documents, should be submitted to the Lender in
a top tabbed, legal size manila file folder, hole-punched and acco-fastened
in the order specified in the Request for Advance. Each folder should be
labelled with the mortgagor name(s), Company loan number and Company name.
If a Wet Settlement Advance is being requested, the Request for Advance and
required Collateral Documents should be submitted in accordance with the
above instructions. The remaining Collateral Documents should be submitted
with a cover letter identifying the mortgagor name(s) and Company loan
number.
IV. Prior to making an Wet Settlement Advance, the Lender must receive the
following:
(1) Estimate of the amount of the requested Advance one (1) Business
Day prior to such Advance.
(2) Copy of settlement or funding check issued to the escrow/title
company, if applicable.
(3) Original Request for Advance against Single Family Mortgage Loans
(Exhibit C-SF) and one (1) copy of same.
(4) Copy of the Purchase Commitment or satisfactory evidence thereof.
(5) Bailee Pledge Agreement (only required for Wet Settlement
Advance) (Exhibit M).
(6) A copy of the HUD-1 Settlement Statement or equivalent (Home
Equity Loans and Title I Mortgage Loans only).
(7) A copy of HUD 203(K) Maximum Mortgage Worksheet (HUD 203(K)
Mortgage Loans only).
(8) Evidence satisfactory to the Lender from the title company
closing the Mortgage Loan that such Mortgage Loan is closed and
funded (only required if Wet Settlement Advance is directly to
the Parent).
42
The following must be received by the Lender within five (5) Business
Days of the date of the Wet Settlement Advance:
(9) Original signed Mortgage Note, endorsed by the Company in blank
with corresponding interim endorsements, if applicable, and one
copy of same.
(10) Copy of the Mortgage certified true by the escrow/title company.
(11) Copies of all interim assignments of the Mortgage certified true
by the escrow/title company (recorded or sent for recordation).
Mortgage Note must bear corresponding endorsements.
(12) An assignment of the Mortgage, endorsed by the Company in blank,
in recordable form but unrecorded.
(13) Completed Company Worksheet Concerning Applicability of Section
32 of Regulation Z (12 CFR Section 226.32) and, if Section 32
applies, copies of the disclosure and other related documentation
delivered to the mortgagor, or executed by the mortgagor,
evidencing compliance with Section 32 (if applicable).
V. Prior to the making of an Advance (other than a Wet Settlement
Advance), the Lender must receive all of the Collateral Documents
listed in Section I above.
VI. The Lender exclusively shall deliver the Mortgage Notes and other
original Collateral Documents evidencing Pledged Mortgages or Pledged
Securities and related pool documents to the Investor or pool
custodian, unless otherwise agreed in
writing.
A. The following procedures are to be followed for deliveries of
Pledged Mortgages:
No later than one (1) Business Day prior to the requested shipment
date and no later than one (1) Business Day prior to the expiration
date of the Purchase Commitment, the Lender must receive the
following:
(1) Signed shipping instructions for the delivery of the
Pledged Mortgages including the following:
(a) Name and address of the office of the Investor to
which the loan documents are to be shipped, the
desired shipping date and the preferred method of
delivery;
(b) Instructions for endorsement of the Mortgage Note;
(c) Names of mortgagor(s), Mortgage Note Amounts of
Pledged Mortgages to be shipped and the Company's
loan number; and
(d) Commitment number and expiration date of the Purchase
Commitment.
43
(2) For deliveries of Pledged Mortgages to FNMA for cash purchase,
the following additional documents are required:
(a) Copy of Loan Schedule (FNMA Form 1068 or 1069)showing the
Lender's designated FNMA payee code as recipient of the loan
purchase proceeds.
(3) For deliveries of Pledged Mortgages to FHLMC for cash
purchase, the following additional documents are
required:
(a) Original completed Warehouse Lender Release of
Security Interest (FHLMC Form 996) to be executed by the
Lender, designating the Lender as the Warehouse Lender and
showing the Cash Collateral Account designated by the Lender
as the receiving account for loan purchase proceeds.
(b) Copy of Wire Transfer Authorization for a Cash Warehouse
Delivery (FHLMC Form 987), designating the Lender as the
Warehouse Lender and showing the Cash Collateral Account
designated by the Lender as the receiving account for loan
purchase proceeds.
B. In the event Pledged Mortgages are delivered to a pool custodian,
other than an Approved Custodian, payment of the related Advance is
required within two (2) Business Days of shipment.
The following procedures are to be followed for deliveries of Pledged
Mortgages to Approved Custodians:
No later than one (1) Business Day prior to the requested shipment
date and no later than one (1) Business Day prior to required delivery
date to the Approved Custodian, the Lender must receive the following:
(1) Signed shipping instructions for the delivery of the
Pledged Mortgages to the Approved Custodian including the
following:
(a) Name and address of the office of the Approved
Custodian to which the loan documents are to be
shipped, the desired shipping date and the
preferred method of delivery;
(b) Instructions for endorsement of the Mortgage Note;
(c) Names of mortgagor(s) and Mortgage Note Amounts of
Pledged Mortgages to be shipped and the Company's
loan number; and
(d) Commitment number and expiration date of the Purchase
Commitment for the Pledged Securities.
44
(2) For FNMA Mortgage-backed Securities issuance, the following
additional documents are required: (a) Copy of Schedule of
Mortgages (FNMA Form 2005 or
2025).
(b) Copy of Delivery Schedule (FNMA Form 2014), instructing FNMA
to issue the Mortgage-backed Securities in the name of the
Company with the Lender as pledgee and to deliver the
Mortgage-backed Securities to the Lender's custody account
at The Chase Manhattan Bank (CHASE NYC/GEOCUST/XX0000000)
and bearing the following instructions: "These instructions
may not be changed without the prior written consent of
Residential Funding Corporation, Xxxxxxx X. Xxxxxx,
Director or Xxxxx Xxxxx, Director."
(3) For FHLMC Mortgage-backed Securities issuance, the
following additional documents are required:
(a) Copy of Settlement Information and Delivery
Authorization (FHLMC Form 939), designating the Lender as
the Warehouse Lender and instructing FHLMC to deliver the
Mortgage-backed Securities to the Lender's custody account
at The Chase Manhattan Bank (CHASE NYC/GEOCUST/XX0000000).
(b) Original Warehouse Lender Release of Security Interest
(FHLMC Form 996) to be executed by the Lender, designating
the Lender as the Warehouse Lender and instructing FHLMC to
deliver the Mortgage-backed Securities to the Lender's
custody account at The Chase Manhattan Bank (CHASE
NYC/GEOCUST/XX0000000).
(4) For GNMA Mortgage-backed Securities issuance, the following
additional documents are required:
(a) Signed original Schedule of Mortgages (HUD Form 11706).
(b) Signed original Schedule of Subscribers (HUD Form
11705) instructing GNMA to issue the Mortgage-backed
Securities in the name of the Company and designating The
Chase Manhattan Bank as Agent for
the Lender as the subscriber, using the following
language: THE CHASE MANHATTAN BANK AS AGENT FOR
RESIDENTIAL FUNDING CORPORATION SEG ACCT
MANUF/CUST/XX0000000). The following instructions
must also be included on the form: "These
instructions may not be changed without the prior
written consent of Residential Funding Corporation,
Xxxxxxx X. Xxxxxx, Director or Xxxxx Xxxxx,
Director."
(c) Completed original Release of Security Interest (HUD Form
11711A) to be executed by the Lender.
(5) No later than two (2) Business Days prior to the Settlement Date
for the Mortgage-backed Securities, the Lender must receive
signed Securities Delivery Instructions form attached hereto as
Schedule I.
45
Upon instruction by the Company, the Lender will complete the endorsement
of the Mortgage Note and make arrangements for the delivery of the original
Collateral Documents evidencing Pledged Mortgages or Pledged Securities and
related original pool documents with the appropriate bailee letter to the
Investor, Approved Custodian, or other pool custodian. Upon receipt of
Mortgage-backed Securities, the Lender will cause such Mortgage-backed
Securities to be delivered to the Investor which issued the Purchase
Commitment. Mortgage-backed Securities will be released to the Investor
only upon payment of the purchase proceeds to the Lender. Cash proceeds of
sales of Pledged Mortgages and Pledged Securities shall be applied to
related Advances outstanding under the Commitment. Provided no Default
exists, the Lender shall return any excess proceeds of the sale of
Mortgage Loans or Mortgage-backed Securities to the Company, unless
otherwise instructed in writing.
46
EXHIBIT D-SF/CONSTRUCTION
PROCEDURES AND DOCUMENTATION FOR WAREHOUSING SINGLE-FAMILY
CONSTRUCTION/PERM MORTGAGE LOANS
The following procedures and documentation requirements must be
observed in all respects by the Company. All documents must be satisfactory
to the Lender in its sole discretion. Terms used below, which are not
otherwise defined, shall have the meanings given them in the Agreement. The
HUD, FNMA and FHLMC form numbers referred to herein are for convenience
only and the Company shall use the equivalent forms required at the time of
delivery of the Mortgage Loans or Mortgage-backed Securities. All Requests
for Advance and Collateral Documents, should be submitted to the Lender in
a top tabbed, legal size manila file folder, hole-punched and acco-fastened
in the order specified in the Request for Advance. Each folder should be
labelled with the mortgagor name(s), Company loan number and Company name.
If a Wet Settlement Advance and/or Initial Construction Advance is being
requested, the Request for Advance and required Collateral Documents should
be submitted in accordance with the above instructions. The remaining
Collateral Documents should be submitted with a cover letter identifying
the mortgagor name(s) and Company loan number. If a Construction Advance
other than an Initial Construction Advance is being requested, the Request
for Advance and required Collateral Documents should be submitted with a
cover letter identifying the mortgage name(s) and Company loan number.
I. Prior to making a Wet Settlement Advance, the Lender must receive the
following:
(1) Estimate of the amount of the requested Advance one (1) Business
Day prior to such Advance.
(2) Copy of settlement or funding check issued to the escrow/title
company, if applicable. (Funding via check available for Initial
Construction Advance only.)
(3) Original Request for Advance against Single-Family
Construction/Perm Mortgage Loans (Exhibit C-SF/CONSTRUCTION) and
one (1) copy of same.
(4) Bailee Pledge Agreement (only required for a Wet Settlement
Advance) (Exhibit M).
(5) A copy of the Appraisal for the Construction/Perm, Mortgage Loan
indicating the As Completed Appraised
Value.
(6) A copy of the Cost Breakdown detailing the Total Costs to
complete the proposed improvements.
(7) Copy of the Purchase Commitment executed by Investor (if
applicable).
47
(8) A Copy of the Construction/Building Loan Agreement certified true
by the escrow/title company, including construction draw
schedule.
(9) Evidence satisfactory to the Lender from the title company
closing the Mortgage Loan that such Mortgage Loan is closed and
the initial construction advance has been funded (only required
if Wet Settlement Advance is directly to the Parent).
Items (2) through (9) above must be received by Lender at least two
(2) Business Days prior to the Advance.
The following must be received by the Lender within five (5) Business
Days of the date of the Wet Settlement Advance:
(10) Original signed Mortgage Note, endorsed by the Company in blank
and one copy of same. The Mortgage Note must include all required
riders including the Construction Rider, if any.
(11) Copy of the Mortgage and required riders including the
Construction Rider, if any, certified true by the escrow/title
company.
(12) Copies of all interim assignments of the Mortgage certified true
by the escrow/title company (recorded or sent for recordation).
Mortgage Note must bear corresponding endorsements.
(13) An assignment of the Mortgage to the Lender in recordable form
but unrecorded.
(14) A Copy of the ALTA Mortgagor's/Lender's Title Policy. The ALTA
Title Policy must be in an amount not less than the Mortgage Note
Amount, include a pending disbursement clause or be written in
the full amount of the Mortgage Loan and all but the standard
exceptions must be removed.
(15) A Copy of the Company's Permanent Mortgage Loan commitment to
mortgagor(s)
II. Prior to the making of an Advance (other than a Wet Settlement Advance
or a Construction Advance), the Lender must receive all of the
Collateral Documents listed in Section I above. Such Collateral
Documents must be received by Lender at least two (2) Business Days
prior to the Advance.
48
III. Prior to the making of a Construction Advance, the Lender must receive
the following:
(1) All of the Collateral Documents listed in Section I above.
(2) Request for Construction Advance (original and one (1) copy).
(3) An original or certified copy (by the title company) of
endorsement to the ALTA Mortgagor's/Lender's Title
Insurance Policy through the date of the previous
Construction Advance for the Mortgage Loan. The
endorsement must indicate the title has been reviewed and
updated through the date of the previous Construction
Advance, the transaction amount must be at least in the
amount of the previous Construction Advance and the
cumulative amount of title insurance must be at least
equal to the aggregate of the Initial Construction
Advance and the Construction Advances to date by RFC
against the Mortgage Loan. The endorsement must also
include the mortgagor name(s) and the title policy number
and be executed by an authorized representative of the
title company.
(4) Evidence satisfactory to the Lender from the title company which
closed the Mortgage Loan that the interim construction advance
for such Mortgage Loan has been funded (only required if Wet
Settlement Advance is directly to the Parent).
Items (1) through (4) above must be received by Lender at least two
(2) Business Days prior to the Advance.
IV. Prior to the making of the Final Construction Advance, the Lender must
receive the following:
(1) All of the Collateral Documents listed in Sections I and III
above.
(2) An original or certified copy (by the title company) of
endorsement to the ALTA Mortgagor's/Lender's Title
Insurance Policy through the date of the Final
Construction Advance for the Mortgage Loan and showing
the modification from a construction Mortgage Loan to a
permanent Mortgage Loan. The endorsement must indicate
the title has been reviewed and updated through the date
of the Final Construction Advance, the transaction amount
must be at least in the amount of the Final Construction
Advance and the cumulative amount of title insurance must
be at least equal to the aggregate of the all
Construction Advances made by RFC against the Mortgage
Loan. The endorsement must also include the mortgagor
name(s) and the title policy number and be executed by an
authorized representative of the title company.
49
(3) Copy of the final survey. This survey must indicate that
the unit has been constructed within the boundaries of
the subject property and that it does not encroach on any
set-back lines, easements or adjacent property (ies). It
must be dated within five (5) days of the advance request
date, include the correct legal description, be certified
by a registered surveyor and include a raised seal.
(4) Purchase Commitment executed by Investor.
(5) Final of appraiser inspection certifying that the final appraised
value of premises encumbered by the Pledged Mortgage equals the
As Completed Appraised Value.
(6) Evidence satisfactory to the Lender from the title company which
closed the Mortgage Loan that the final construction advance for
such Mortgage Loan has been funded (only required if Wet
Settlement Advance is directly to the Parent).
Items (1) through (6) above must be received by Lender at least two
(2) Business Days prior to the Advance.
V. The Lender exclusively shall deliver the Mortgage Notes and other
original Collateral Documents evidencing Pledged Mortgages or Pledged
Securities and related pool documents to the Investor or pool
custodian, unless otherwise agreed in
writing.
A. The following procedures are to be followed for deliveries of
Pledged Mortgages:
No later than one (1) Business Day prior to the requested shipment
date and no later than one (1) Business Day prior to the expiration
date of the Purchase Commitment, the Lender must receive the
following:
(1) Signed shipping instructions for the delivery of the
Pledged Mortgages including the following:
(a) Name and address of the office of the Investor to
which the loan documents are to be shipped, the
desired shipping date and the preferred method of
delivery;
(b) Instructions for endorsement of the Mortgage Note;
(c) Names of mortgagor(s), Mortgage Note Amounts of
Pledged Mortgages to be shipped and the Company's
loan number; and
(d) Commitment number and expiration date of the Purchase
Commitment.
(2) For deliveries of Pledged Mortgages to FNMA for cash purchase,
the following additional documents are required:
(a) Copy of Loan Schedule (FNMA Form 1068 or 1069)
showing the Lender's designated FNMA payee code as recipient
of the loan purchase proceeds.
50
(3) For deliveries of Pledged Mortgages to FHLMC for cash
purchase, the following additional documents are
required:
(a) Original completed Warehouse Lender Release of
Security Interest (FHLMC Form 996) to be executed by the
Lender, designating the Lender as the Warehouse Lender and
showing the Cash Collateral Account designated by the Lender
as the receiving account for loan purchase proceeds.
(b) Copy of Wire Transfer Authorization for a Cash Warehouse
Delivery (FHLMC Form 987), designating the Lender as the
Warehouse Lender and showing the Cash Collateral Account
designated by the Lender as the receiving account for loan
purchase proceeds.
B. In the event Pledged Mortgages are delivered to a pool custodian,
other than an Approved Custodian, payment of the related Advance is
required within two (2) Business Days of shipment.
The following procedures are to be followed for deliveries of Pledged
Mortgages to Approved Custodians:
No later than one (1) Business Day prior to the requested shipment
date and no later than one (1) Business Day prior to required delivery
date to the Approved Custodian, the Lender must receive the following:
(1) Signed shipping instructions for the delivery of the
Pledged Mortgages to the Approved Custodian including the
following:
(a) Name and address of the office of the Approved
Custodian to which the loan documents are to be
shipped, the desired shipping date and the
preferred method of delivery;
(b) Instructions for endorsement of the Mortgage Note;
(c) Names of Mortgagor and Mortgage Note Amounts of
Pledged Mortgages to be shipped; and
(d) Commitment number and expiration date of the
Purchase Commitment for the Pledged Securities.
(2) For FNMA Mortgage-backed Securities issuance, the
following additional documents are required:
(a) Copy of Schedule of Mortgages (FNMA Form 2005 or
2025).
(b) Copy of Delivery Schedule (FNMA Form 2014), instructing FNMA
to issue the Mortgage-backed Securities in the name of the
Company with the Lender as pledgee and to deliver the
Mortgage-backed Securities to the Lender's custody account
at Chemical Bank NY (CHEMICAL NYC/GEOCUST/XX0000000) and
bearing the following instructions: "These instructions
may not be changed without the prior written consent of
Residential Funding Corporation, Xxxxxxx X. Xxxxxx,
Director or Xxxxx Xxxxx, Regional Operations
Manager."
51
(3) For FHLMC Mortgage-backed Securities issuance, the
following additional documents are required:
(a) Copy of Settlement Information and Delivery Authorization
(FHLMC Form 939), designating the Lender as the Warehouse
Lender and instructing FHLMC to deliver the Mortgage-backed
Securities to the Lender's custody account at Chemical Bank
NY (CHEMICAL NYC/GEOCUST/XX0000000).
(b) Original Warehouse Lender Release of Security Interest
(FHLMC Form 996) to be executed by the Lender, designating
the Lender as the Warehouse Lender and instructing FHLMC to
deliver the Mortgage-backed Securities to the Lender's
custody account at Chemical Bank NY (CHEMICAL
NYC/GEOCUST/XX0000000).
(4) For GNMA Mortgage-backed Securities issuance, the following
additional documents are required:
(a) Signed original Schedule of Mortgages (HUD Form 11706).
(b) Signed original Schedule of Subscribers (HUD Form
11705) instructing GNMA to issue the Mortgage-backed
Securities in the name of the Company and designating
Chemical Bank as Agent for the Lender as the subscriber,
using the following language: CHEMICAL BANK AS AGENT FOR
RESIDENTIAL FUNDING CORPORATION SEG ACCT
MANUF/CUST/XX0000000). The following instructions must also
be included on the form: "These instructions may not be
changed without the prior written consent of Residential
Funding Corporation, Xxxxxxx X. Xxxxxx, Director or Xxxxx
Xxxxx, Regional Operations Manager."
(c) Completed original Release of Security Interest (HUD Form
11711A) to be executed by the Lender.
(5) No later than two (2) Business Days prior to the Settlement Date
for the Mortgage-backed Securities, the Lender must receive
signed Securities Delivery Instructions form attached hereto as
Schedule I.
Upon instruction by the Company, the Lender will complete the endorsement
of the Mortgage Note and make arrangements for the delivery of the original
Collateral Documents evidencing Pledged Mortgages or Pledged Securities and
related original pool documents with the appropriate bailee letter to the
Investor, Approved Custodian, or other pool custodian. Upon receipt of
Mortgage-backed Securities, the Lender will cause such Mortgage-backed
Securities to be delivered to the Investor which issued the Purchase
Commitment. Mortgage-backed Securities will be released to the Investor
only upon payment of the purchase proceeds to the Lender. Cash proceeds of
sales of Pledged Mortgages and Pledged Securities shall be applied to
related Advances outstanding under the Commitment. Provided no Default
exists, the Lender shall return any excess proceeds of the sale of Mortgage
Loans or Mortgage-backed Securities to the Company, unless otherwise
instructed in writing.
52
EXHIBIT D-SF/UNI
PROCEDURES AND DOCUMENTATION FOR WAREHOUSING
UNIMPROVED MORTGAGE LOANS
The following procedures and documentation requirements must be
observed in all respects by the Company. All documents must be satisfactory
to the Lender in its sole discretion. Terms used below, which are not
otherwise defined, shall have the meanings given them in the Agreement. All
Requests for Advance and Collateral Documents, should be submitted to the
Lender in a top
tabbed, legal size manila file folder, hole-punched and acco-fastened in
the order specified in the Request for Advance. Each folder should be
labelled with the mortgagor name(s), Company loan number and Company name.
I. AT LEAST FIVE (5) BUSINESS DAYS PRIOR TO THE ADVANCE DATE (except in
the initial Unimproved Advances, in which case the following documents
must be received at least one (1) Business Days prior to the Advance
Date):
The Lender must receive a letter signed by the Company providing the
following information on the Pledged Mortgage:
(1) Mortgagor's name;
(2) Company's case/loan number;
(3) Expected Advance date;
(4) Original Mortgage Note Amount;
(5) Current Mortgage Note Amount;
(6) Purchase Price for Related Property;
(7) Estimation of Fair Market Value of
Related Property, Prepared by the Company
(Properties Intended for Commercial
Development only); and
(8) Original signed Request for Advance (Exhibit C-UNI).
II. AT LEAST ONE (1) BUSINESS DAY PRIOR TO THE DATE OF AN ADVANCE:
The Lender must receive the following:
(1) The original Mortgage Note, endorsed by the Company in blank and
without recourse. If the Company is not the named holder of the
Mortgage Note, the Mortgage Note must bear an endorsement from
the holder to the Company.
(2) If the Company is not the mortgagee on the Mortgage, a copy of
the assignment of Mortgage by the mortgagee to the Company which
was sent for recordation on or before the date of the Advance.
(3) Original recorded assignment of the Mortgage to the Lender, or
certified true copy of assignment of the Mortgage sent for
recording;
53
(4) Original assignment of the security agreement, if any, to the
Lender;
(5) Original assignment of the UCC financing statements, if any, to
the Lender in recordable form but unrecorded;
(6) A copy of the title insurance commitment to issue a policy of
title insurance marked to show the final policy exceptions or, if
available, a copy of the title insurance policy;
(7) Check payable to the Lender for the Warehousing Fee; and
(8) Evidence satisfactory to the Lender from the title company closing
the Mortgage Loan that such Mortgage Loan is closed and funded
(only required if Wet Settlement Advance is directly to the Parent).
III. The Lender exclusively shall deliver the Mortgage Notes and other
original Collateral Documents in connection with any sale,
refinancing, foreclosure or other satisfaction of any Pledged
Mortgage. Such deliveries shall be made in accordance with procedures
specified from time to time by the Lender.
54
SCHEDULE I
RESIDENTIAL FUNDING CORPORATION
WAREHOUSING LENDING DIVISION
Security Delivery Instructions
INSTRUCTIONS MUST BE RECEIVED TWO (2) BUSINESS DAYS IN ADVANCE OF
PICK-UP/DELIVERY
BOOK-ENTRY DATE: ______________________ SETTLEMENT DATE:__________________
ISSUER:________________________________ SECURITY: $_______________________
NO. OF CERTIFICATES: __________________ 1)________________
2)________________
3)________________
CUSIP #______________
Pool #_______________ MI#______________ Coupon Rate:_____________
Issue Date:(M/D/Y) ________________ Maturity Date:(M/D/Y)_____________
POOL TYPE (circle one):
GNMA: GNMA I GNMA II
FHLMC: FIXED ARM DISCOUNT NOTE
FNMA: FIXED ARM DISCOUNT NOTE DEBENTURES REMIC
DELIVER TO:_______________________________ ( ) Versus Payment
_______________________________ DVP AMT. $
_______________________________ ( ) Free Delivery
DELIVER TO:_______________________________ ( ) Versus Payment
_______________________________ DVP AMT. $
_______________________________ ( ) Free Delivery
DELIVER TO:_______________________________ ( ) Versus Payment
_______________________________ DVP AMT. $
_______________________________ ( ) Free Delivery
AUTHORIZED SIGNATURE:___________________________________
TITLE:__________________________________________________
