Doing Business with Gateway Correspondent Lending Client Guide Chapter 1

Transcription

1 Doing Business with Gateway Correspondent Lending Client Guide Chapter Gateway Mortgage Group, LLC. Rev. 6/27/14

2 TABLE OF CONTENTS Chapter 1 Doing Business with Gateway Correspondent Lending General Purpose of this Guide Gateway Business Hours and Holiday Schedule The Gateway Correspondent Team Correspondent Division Manager Correspondent Operations and Underwriting Correspondent Sales Team Correspondent Support Contacts Registration and Lock Desk General Questions Correspondent Loan Servicing Other Helpful Information Wire Transfer Mortgagee Clause MERS ID Number FHA ID Number VA ID Number USDA ID Number Correspondent Website Mailing Addresses The information provided herein is for business and professional use only and should not be considered an advertisement to extend credit or a commitment to purchase loans. All loans are subject to program guidelines and final underwriting approval. This information is subject to change at any time without notice. Gateway Mortgage Group is a registered service mark of Gateway Mortgage Group, LLC. NMLS

3 Doing Business with Gateway Correspondent Lending General Gateway is delighted that you have become our business partner! This Chapter contains general information you will need in order to transact business with Gateway s Correspondent Division. Please direct questions to the Correspondent Division associates at their direct numbers and addresses shown below. Purpose of this Guide The purpose of this Gateway Correspondent Client Guide ( Guide ) is to provide Gateway s approved Correspondent clients ( Clients ) with policy and procedure requirements to follow when doing business with us. The Guide is a critical component of the Contract Documents governing our relationship. Exceptions to the requirements of this Guide, the Correspondent Loan Purchase and Sale Agreement ( Agreement ) or any other Contract Documents (as defined in the Agreement) must be granted in writing by an authorized officer of Gateway. This Guide contains information that is confidential and is the property of Gateway s Correspondent Channel. It may not be copied, published, or used, in whole or part, for any purpose other than as expressly authorized by Gateway. Gateway Business Hours and Holiday Schedule Gateway s Correspondent Division business hours are between 8:30 a.m. and 5:00 p.m. (CT), Monday through Friday. Gateway is closed on the following holidays: New Year s Day Memorial Day Independence Day Labor Day Thanksgiving Day Friday after Thanksgiving Christmas Day It is important that the contents of this Guide be shared with all pertinent parties within your organization to ensure compliance with Gateway s guidelines when registering, underwriting, or delivering loans to Gateway for purchase. As new products, policies, or procedures are introduced, or existing policies and procedures are revised, you will receive a Correspondent Client Announcement as initial notification of the change. The contents of the announcements will be incorporated into the Guide. Additionally, the Gateway Correspondent Website is a vital component of doing business with Gateway. It is located at 3

4 The Gateway Correspondent Team Correspondent Division Manager Scott Henley Senior Vice President, Correspondent Production Manager 4201 North State Highway 161, Suite 100 Irving, Texas , ext. 168 main direct mobile Correspondent Operations and Underwriting Linda Garloch Correspondent Operations Manager direct Debi Hunter Correspondent Underwriting Manager direct Donell McMullen Correspondent Client Liaison direct toll free Gary Lemley Correspondent Client Liaison direct toll free Michele Chapman Correspondent Client Liaison direct toll free Compliance and Credit Lamar Brown Manager of Counterparty Administration direct 4

5 The Gateway Correspondent Team Correspondent Sales Team Scott Henley Senior Vice President National Correspondent Production Manager direct mobile Greg Komar Regional Sales Manager direct mobile Jared Edmonds Regional Sales Manager direct mobile Jace Cowan Regional Sales Manager mobile 5

6 The Gateway Correspondent Team Registration and Lock Desk Lock Desk Personnel Toll free :30 a.m. to 5:00 p.m. CT Online Locking First posting to 8:00 p.m. CT General Questions Questions regarding post-delivery operational issues, including suspense conditions, reconciliations, and website technical assistance, should be directed to: Donell McMullen Correspondent Client Liaison direct toll free Gary Lemley Correspondent Client Liaison direct toll free Please questions regarding underwriting policies, guidelines and scenarios to s will be responded by the end of the following business day. Always include your Gateway Client ID and Loan # in all communications! Correspondent Loan Servicing Correspondent Liaison for Servicing Issues (Clients and Borrowers) Toll free

7 Other Helpful Information Wire Transfer Wire transfer instructions for remitting any monies due Gateway are as follows: Arvest Bank, Tulsa OK ABA Credit: Gateway Mortgage Group, LLC Gateway Loan Number: (insert Gateway loan number) Borrower Name (insert borrower name) Attn: Correspondent Accounting Purpose: (Specify) Please state the purpose of the wired funds (e.g., mortgage payment, funding reconciliation, pair off fees, repurchase proceeds). For proper credit, the wire must also reference the borrower s name and account number. Mortgage Clause As of the purchase date, the mortgagee clause for all types of insurance policies (hazard, flood, MI, title) must read: Gateway Mortgage Group, LLC ISAOA ATIMA 6910 East 14th Street Tulsa, OK MERS ID Gateway s MERS Identification Number: FHA ID Gateway s FHA Identification Number: VA ID Gateway s VA Identification Number: USDA ID Gateway s USDA Identification Number:

8 Correspondent Website Website Gateway Mortgage Group, LLC s business to business website, www. GatewayCorrespondent.com, offers our correspondent clients the ability to perform the following functions on-line: access product, pricing and pipeline information register and/or lock a loan with immediate confirmation view and print lock confirmations view loan status import the Fannie Mae 3.2 loan file to Gateway upload and deliver imaged files and documents print approvals and view purchase advices access the Correspondent Client Guide Access to the functions listed above can be granted by contacting your Regional Sales Manager. 8

9 Mailing Addresses Please refer to this chart for specific mailing addresses for overnight and regular U.S. Mail. Original Notes Type of Documentation Files for Underwriting, and/or Purchase Review and Funding (Note: Preferred delivery method is via imaging upload. See Delivery Chapter for instructions.) Suspense Items for Loan Purchase Review (Note: Preferred delivery method is image upload) Miscellaneous Correspondence relating to Sales and Marketing Fees Due Gateway (if not net funded, e.g. DO Payments, Late Doc fees, Extended Lock Payments, EPO/EPD fees, repurchase proceeds) (Note: Preferred delivery method is by wire. See also Wiring Instructions in this Chapter.) Final Documents Title Policies Recorded Security Instruments Recorded Subordination Agreements Submissions, if applicable Tax Bills Hazard Insurance Policies, Flood Insurance Policies, Mortgage Insurance Certificates/Invoices Mortgage Payments (Note: Preferred delivery method is by wire. See also Wire Transfer in this Chapter.) Mortgage Payoffs (Note: Preferred delivery method is by wire. See also Wire Transfer in this Chapter.) Client Approval/Recertification Documents Mailing Address Gateway Mortgage Group, LLC Attn: Correspondent Note Custodian 6910 East 14th Street Tulsa, Oklahoma Gateway Mortgage Group, LLC Attn: Correspondent File Set-Up 4201 N State Highway 161, Suite 100 Irving, Texas Gateway Mortgage Group, LLC Attn: Correspondent Suspense Team 4201 N State Highway 161, Suite 100 Irving, Texas Gateway Mortgage Group, LLC Attn: Correspondent Sales 4201 N State Highway 161, Suite 100 Irving, Texas Gateway Mortgage Group LLC Attn: Correspondent Accounting 6910 East 14th Street Tulsa, Oklahoma Gateway Mortgage Group, LLC Attn: Correspondent Final Documents 6910 East 14th Street Tulsa, Oklahoma Corrpostdocs@GatewayLoan.com Gateway Mortgage Group, LLC Attn: Tax Department 6910 East 14th Street Tulsa, Oklahoma Gateway Mortgage Group, LLC Attn: Insurance Department 6910 East 14th Street Tulsa, Oklahoma Gateway Mortgage Group, LLC Attn: Payment Processing PO Box Tulsa, Oklahoma Gateway Mortgage Group, LLC Attn: Payoffs 6910 East 14th Street Tulsa, Oklahoma Gateway Mortgage Group, LLC Attn: Correspondent Client Administration 4201 N State Highway 161, Suite 100 Irving, Texas

10 Eligible Mortgage Loans Client Guide Chapter Gateway Mortgage Group, LLC. Rev. 6/27/14

11 TABLE OF CONTENTS Chapter 2 Approved Products and Services Eligible Property and Lien Status Geographic Restrictions Florida By Product Eligibility Restrictions Age of Loan / Prior Rejects Overlays Property Type Restrictions Loan Type / Feature Restrictions Borrower Type Restrictions Third Party Originations Warehouse Lines of Credit and Wire Instructions General Wire Instruction and Warehouse Line Verification Form The information provided herein is for business and professional use only and should not be considered an advertisement to extend credit or a commitment to purchase loans. All loans are subject to program guidelines and final underwriting approval. This information is subject to change at any time without notice. Gateway Mortgage Group is a registered service mark of Gateway Mortgage Group, LLC. NMLS

12 Eligible Mortgage Loans General Qualified Mortgage Loan Clients will receive an approval letter specifying the products, and services for which they are eligible. Clients should contact their Regional Sales Manager or Client Liaison should their business needs change after their initial approval. All loans must fully comply with all requirements of Fannie Mae, FHA, ONAP Section 184, VA, and USDA, as applicable, unless otherwise specified below, in the applicable Product Description, or the Gateway Correspondent Overlay Matrix. For any loan that is subject to 12 CFR Section , Gateway will only purchase the loan if (i) it meets the definition of a Qualified Mortgage as set forth in 12 CFR Section (e) (2) Loan and (ii) complies with the Ability To Repay Standards, and all necessary evidence to demonstrate such compliance with 12 C.F.R. Part (e) and 12 C.F.R. Part (c) is included in the loan file transferred to Gateway. Loans that are not subject to 12 CFR Section will only be purchased if they meet all applicable agency and program guidelines. Any breach of these requirements shall be deemed to materially and adversely affect the value of the loan and shall require a repurchase of the affected loan. Loans that are not subject to 12 CFR Section will only be purchased if they meet all applicable agency and program guidelines. Any breach of these requirements shall be deemed to materially and adversely affect the value of the loan and shall require a repurchase of the affected loan. Eligible Property and Lien Status General All loans must be secured by a first lien mortgage on a one-to-four family residential dwelling located in: Alabama Indiana Nebraska Tennessee Arizona Iowa Nevada Texas Arkansas Kansas New Jersey Utah California Louisiana New Mexico Virginia Colorado Maryland North Carolina West Virginia Delaware Michigan Oklahoma Wisconsin Florida * Mississippi Pennsylvania Wyoming Illinois Missouri South Carolina * See Geographic Restrictions section regarding Florida. Refer to the individual Product Descriptions for further product specific geographic lending restrictions. Gateway must approve and activate each state before Clients can register loans secured by properties in any given state. Clients must contact their Regional Sales Manager or Client Liaison to request approval for additional states. 12

13 General (cont.) Gateway relies upon the Client s representations and warranties that all loans are enforceable in accordance with the terms of Gateway s Correspondent Loan Purchase and Sale Agreement ( Agreement ) and comply with all applicable federal, state and local laws. Clients must be aware of, and in compliance with, all terms, representations and warranties contained in the Agreement. Clients are responsible for adhering to all federal, state and local laws and/or regulatory lending guidelines, as well as licensing requirements. Geographic Restrictions Florida The following property types are not eligible in Florida: Condominium units (entire state) All property types located in Broward, Martin, Miami-Dade, Monroe or Palm Beach counties By Product See these Product Descriptions for additional product level geographic restrictions: Texas A6 Equity Loan FHA HUD Section 184 USDA Rural Development Eligibility Restrictions Age of Loan / Prior Rejects Overlays The following loans are not eligible: Loans closed more than 60 days prior to delivery to Gateway. Loans previously rejected by or repurchased from Gateway. Loans previously rejected by or required to be repurchased from or indemnified by Freddie Mac, Fannie Mae, FHA, ONAP, VA or USDA. Loans previously rejected by or required to be repurchased from a private investor, unless such prior rejection / repurchase is fully and specifically disclosed to Gateway in the loan file and Gateway determines the loan is eligible for purchase regardless of the prior investor s determination. Refer to the Correspondent Overlay Matrix for Gateway restrictions and overlays to Fannie Mae, FHA, ONAP Section 184, VA and USDA eligibility, underwriting and documentation requirements regarding: Continued on next page 13

14 Eligibility Restrictions (cont.) Property Type Restrictions See Overlay Matrix. Loan Type Feature/ Restrictions The following loan types, characteristics and/or features are not eligible: Temporary Interest Rate Buydowns Conventional Loans with Down Payment Assistance Programs. Government loans originated under Bond Programs or with non-gateway approved governmental or tribal DPA programs. See the FHA and Section 184 Product Descriptions for links to the current applicable list of approved DPA programs. Section 32, high cost loans (as defined by the Agencies or applicable federal or state regulation) Loan types or loans with features that do not conform in all respects to Fannie Mae, FHA, ONAP Section 184, VA or USDA Guidelines (as applicable for the loan type) Borrower Type Restrictions The following borrower types are not eligible: Borrowers and households with more than 4 financed properties serviced by Gateway, regardless of occupancy or purpose of subject loan Borrowers who are financing a non-owner occupied or second home are limited to 4 financed properties. Borrowers who are financing primary residences may have unlimited financed properties not serviced by Gateway Borrowers with no social security number (ITIN only) Borrower types that do not conform in all respects to Fannie Mae, FHA, ONAP Section 184, VA or USDA Guidelines (as applicable for the loan type) Third Party Originations Gateway does not purchase loans originated through third party originators ( TPOs ). Client level exceptions may be considered only for higher net worth Clients with a TPO program established for at least 3 years; strong TPO controls must be demonstrated. Contact your Sales Manager for consideration. 14

15 Warehouse Lines of Credit and Wire Instructions General These requirements apply to Clients utilizing warehouse lines: Clients may borrow money to fund the origination of mortgage loans from a warehouse lender of their choice. Loans funded by Clients corporate or personal funds, and/or lines of credit not obtained through a warehouse lender, are not eligible for sale. Gateway requires bailee letters be submitted with the original Note from warehouse lenders. Note: Clients who are financial institutions (banks, savings & loans, credit unions) or who are wholly owned subsidiaries of a financial institution are NOT required to attach bailee letters to the original Note. However, these exempt clients must provide correct wiring instructions with each Note. Gateway has the option to decline to purchase mortgage loans funded through any warehouse lender which creates additional risk or unreasonable workload in connection with purchasing a mortgage loan Examples of line of credit requirements that might cause Gateway to decline to purchase mortgage loans are: The warehouse lender will not release its security interest in the mortgage loan or note upon transmittal of the purchase proceeds. The warehouse lender requires Gateway to enter into agreements other than a typical collateral bailee agreement. Please refer to Chapter 4 of this Guide for additional information and requirements for warehouse lenders. Wire Instructions and Warehouse Line Verification Form Gateway will obtain the Client s application and Wire Instructions and Authorization to Verify Warehouse Line form during the new client approval and/or annual re-certification process. At the time of loan purchase, the warehouse lender information must match the data previously submitted by the Client during the initial approval and/or recertification process. Gateway will validate the wire authorization with the warehouse lender for each loan purchased. Gateway will require the Client to complete a new Wire Instructions and Authorization to Verify Warehouse Line form when the wire authorization information does not match the data in our records. Wire Instructions must include a physical address for the destination institution. The updated information must be provided to and validated by Gateway prior to the funding of the loan. Please refer to Chapter 4 of this Guide for additional information and requirements for warehouse lenders and wire instructions. 15

16 Loan Registration and Lock Policies Client Guide Chapter Gateway Mortgage Group, LLC. 6/27/14

17 TABLE OF CONTENTS Chapter 3 Daily Rates and Price Notification Loan Registration and Lock Procedures General Escrow Waivers Confirmations Lock Policies General Extended Lock Program Re-Locks, Expirations, Extensions and Renegotiations Re-Locks and Expired Locks Extension Fees Renegotiations Program Changes Fallout Policy Automatic Extensions on Delivered Loans General The information provided herein is for business and professional use only and should not be considered an advertisement to extend credit or a commitment to purchase loans. All loans are subject to program guidelines and final underwriting approval. This information is subject to change at any time without notice. Gateway Mortgage Group is a registered service mark of Gateway Mortgage Group, LLC. NMLS

18 Daily Rates and Price Notification General Clients are notified of daily rates and prices as follows: Rate sheets will be distributed daily via . Rates and prices are valid until 8:00 p.m. CT. There is no overnight protection available. Locks must be completed online at Pricing will be available from the time the first rate sheet is posted until 8:00 p.m. CT. Lock desk personnel can be reached until 5:00 p.m. CT at or Price Adjustments and SRP schedules can be found on the website. Final price quoted on all Lock Confirmations includes adjustments and SRP. Volatile market conditions may dictate that prices change more than once per day. Gateway will notify Clients of price changes when possible; however, there are circumstances when the Secondary Marketing department must temporarily close the Lock Desk until revised pricing is available. Loan Registration and Lock Procedures General Clients must register and/or lock loans electronically on Gateway s correspondent website at Additionally, the following loan registration and lock policies apply: All loans must be registered prior to submission for prior underwriting or exception consideration (not available on all loan programs/products); and All loans must have a registered lock no later than one (1) business day prior to delivery Clients must the Lock Desk at Corrlock@GatewayLoan.com for any post-lock changes. 18

19 Loan Registration and Lock Procedures (cont.) Escrow Waivers Policies and procedures regarding escrow waivers are: Escrow waiver price adjustments may vary according to loan terms and state. See the SRP Schedule for specific escrow waiver price adjustments. If partial escrows are being waived, the full escrow waiver fee adjustment applies. If flood insurance is required, a partial escrow waiver is not permitted. If an escrow waiver is requested within ninety (90) days after Gateway purchases a loan, the Client will be billed for the escrow waiver fee price adjustment. Confirmations Follow these policies and procedures for confirmations: A Lock Confirmation will be generated once a valid lock is entered. If a Lock Confirmation is not received, please contact the Lock Desk at Corrlock@ GatewayLoan.com. It is the Client s responsibility to review each Lock Confirmation for accuracy. If the Client notes any discrepancies, they should contact the Lock Desk immediately. In the event of a discrepancy between the price stated on the Lock Confirmation and the price as calculated using the published rate sheet as of the day and time of the lock, the published rate sheet will prevail. 19

20 Loan Policies General Gateway s general lock policies are as follows: Lock periods are available for 12, 21, 30, 45 and 60 day terms. Lock confirmations are tied to the property address. If the property address changes, a new lock is required at current market pricing. If the property changes back to any previous address locked with the borrower, the pricing will be subject to worse case. Locks with weekend or holiday expiration dates will expire on the first business day following the stated expiration date. If the loan amount changes by more than 10% of the original principal balance, the difference between the final loan amount and the loan amount on the lock will be subject to the worse of current market or original lock date pricing. Clients should review product descriptions and guidelines before locking a loan to ensure the loan meets Gateway s policies. Acceptance of a lock by Gateway does not guarantee loan eligibility. Clients must ensure the rate and pricing selected does not exceed any applicable agency, state or federal high cost, or similarly restricted pricing limits. Gateway does not perform any points and fee testing prior to accepting locks. Best efforts delivery is expected on all locked loans. Clients must make every effort to close the loan according to the terms of the Lock. If the borrower changes the type of loan requested so that the terms of the loan no longer agree with the terms of the Lock, the Client must notify the Lock Desk and the loan will be re-priced. Loan delivery is mandatory on closed loans that are locked with Gateway. It is an event of default, under the Correspondent Loan Purchase and Sale Agreement, if a loan subject to a best efforts lock closes but is not delivered to Gateway. In the event of such a default, notwithstanding the remedies outlined in the Agreement, Gateway may charge the Client a pair off penalty. The pair off penalty will not be less than the quoted loan price on the expiration date of the Lock less the Lock price, with a minimum penalty of one eighth of one percent (0.125%) of the loan principal. If a locked loan is withdrawn, an audit may be completed to verify that the borrower has withdrawn the loan. Extended Lock Program Extended locks are available for 30 and 15 year Conventional, FHA, and VA loans, with a maximum loan amount of $417,000. Product codes are: CF30EL, CF15EL, F30EL, F15EL, V30EL, and V15EL. 20

21 Extended Lock Program (cont.) A float down option is available and it must be exercised prior to closing. The client may choose from the 21, 30, 45, or 60 day lock periods at float down. If the float-down is exercised, the lock expiration date will be the sooner of the lock term selected at floatdown or the original lock expiration date. Lock extensions after the float-down are subject to Gateway s extension policy. Loan level price adjustments (LLPA) are based on the original lock date or the date the float-down is exercised. An extended lock requires an upfront lock fee to be submitted within 5 business days from the original lock date. The upfront lock fee is 1.00% of the total loan amount at the time the loan is locked. The lock fee will be refunded on the date the loan is purchased by Gateway. Lock fees for denied loans will be refunded, provided the reason for denial is not caused by failure to provide requested documentation. A copy of the executed Correspondent Extended Rate Lock agreement and a check for the lock fee must be sent by express mail, for tracking purposes, to: Gateway Mortgage Group, LLC Attn: Judy Strain c/o Accounting 4201 N. State Highway 161, Suite 100 Irving, TX Extended Lock Period Options: Lock Period Extended Lock Adjustment 90 days 60 Day Base to Rate 120 days 60 Day Base to Rate 150 days 60 Day Base to Rate 180 days 60 Day Base to Rate 21

22 Re-Locks, Expirations, Extensions and Renegotiations Re-Locks and Expired Locks Re-locks and expired rate lock policies and procedures are: If the original lock term expired within the last 30 days, a one-time Re-lock may be granted under the following terms: Re-lock term Re-lock fee Re-lock Price 1-7 days 0.300% Worse of: Current 12 day price-or-original Price minus re-lock fee 8-15 days 0.425% Worse of: Current 21 day price-or-original Price minus re-lock fee days 0.625% Worse of: Current 30 day price-or-original Price minus re-lock fee The loan must meet guidelines in place at the time of the re-lock. If the original lock has been expired for more than thirty (30) days, the loan is re locked at current market pricing. Loan cannot have closed prior to the re-lock date. If a loan has been expired for more than forty five (45) days, the loan will automatically be canceled from Gateway s pipeline. All exceptions to pricing policies are negotiated on a case-by-case basis. 22

23 Re-Locks, Expirations, Extensions and Renegotiations (cont.) Extension Fees The extension of an existing lock must be completed prior to expiration. A loan may be extended up to three (3) times for a maximum of thirty (30) days total. After the third extension or extensions exceeding thirty (30) days, the loan is subject to worse case pricing. See below for extension terms and fees: Extension Term Extension Fee 1-3 days 0.075% 4-7 days 0.175% 8-15 days 0.250% days 0.500% Notes: The loan must meet guidelines in place at the time of the extension Policies are subject to change without notice. Renegotiations Lock renegotiations are evaluated on a case-by-case basis. Please contact the Lock Desk for consideration of a specific case. Program Changes Please utilize the following table if a program change is necessary during an existing lock period: Original Program New Program RateSheet Fixed > 15 Years Fixed > 15 Years Original Fixed <= 15 Years Fixed <= 15 Years Original Fixed > 15 Years Fixed <= 15 Years Worse Case Fixed <= 15 Years Fixed > 15 Years Worse Case ARM Other ARM Product Original ARM Fixed Worse Case Fixed ARM Worse Case 23

24 Fallout General Gateway s ability to offer competitive pricing is directly affected by our Clients ability to manage their fallout ratios at an acceptable level. Fallout occurs when a loan is not delivered for purchase. A loan is considered a fallout loan if: the lock expired prior to the loan delivery, the loan was denied, the loan was withdrawn Clients are responsible for notifying the Lock Desk within one (1) business day if a loan falls out due to denial or withdrawal. Gateway reserves the right to charge a pair off fee for any locked loan that is closed but not delivered to Gateway. The pair off fee is calculated by taking the difference in original price and current market and multiplying that figure by the loan amount. The minimum pair off fee is 0.125% of the loan amount 24

25 Automatic Extensions on Delivered Loans General The following applies to delivered loans and extensions: If the file is delivered for purchase on or prior to the Lock Expiration Date, Clients have up to ten (10) calendar days after the Lock Expiration Date for the loan to be reviewed and purchased. If the loan is not purchased within ten (10) calendar days from the Lock Expiration Date, the loan will automatically be extended seven (7) calendar days and assessed a 0.175% extension fee. This automatic extension and fee assessment will repeat every seven (7) calendar days up to a maximum of 30 days from the original Lock Expiration Date. If all suspense conditions are not cured and the loan is not purchased within thirty (30) calendar days from the original Lock Expiration date, Gateway has the option of continuing to extend the loan as indicated above or deciding that the loan is no longer eligible for purchase and returning the loan file to the Client. Return of Mortgage Loans The decision to continue to extend the loan or return the file to the Client will be discussed by the Correspondent Operations Manager and the Regional Sales Manager. If the decision is reached to return the loan to the Client, Gateway will contact the client to make arrangements to return the original note. 25

26 Loan Delivery and Purchase Policies Client Guide Chapter Gateway Mortgage Group, LLC. Rev. 6/27/14

27 TABLE OF CONTENTS Chapter 4 Loan Delivery and Purchase General Calculating Interest Age of Loans / Prior Rejects Electronic and Stamped Signatures Pre-signing Documents Pre-and Post-Purchase Reviews Delivering Loan Packages Purchase Requirements Balance and Payments Amortized Fees Purchase Advice Original Collateral Package Documentation Note Note Endorsement or Allonge Bailee Letter / Wire Instructions Powers of Attorney Closing, Servicing and Compliance Documentation Submission Checklist Rate Lock Confirmation Security Instrument and Riders MERS Title Insurance Closing Protection Letter Surveys Name Affidavit Trusts Payment History First Payment Letter HUD-1 Escrow Waivers Taxes Hazard Insurance Flood Determination Certificate Flood Insurance PMI Government Loans Closing Instructions W-9 Disclosures Right of Rescission HMDA IRS Form 4506-T Good-bye Letter Borrower Contact Sheet Gateway Mortgage Group, LLC.

28 TABLE OF CONTENTS Chapter 4 (cont.) Underwriting Documentation Underwriting Methods Underwriting Approval AUS Findings Income Calculation Worksheet Blanket Authorization Overlays Product Descriptions IRS Form 4506-T ULDP Fannie Mae LQI Checks Post-Purchase Documentation General Post-Purchase Documents Post-Purchase Actions The information provided herein is for business and professional use only and should not be considered an advertisement to extend credit or a commitment to purchase loans. All loans are subject to program guidelines and final underwriting approval. This information is subject to change at any time without notice. Gateway Mortgage Group is a registered service mark of Gateway Mortgage Group, LLC. NMLS

29 Loan Delivery and Purchase General Clients are required to deliver closed loans by 3 p.m. CST on or prior to the Lock Expiration date. If a complete loan package is not received by 3 p.m. CST on or prior to the Lock Expiration Date, the commitment must be extended or re-locked as outlined in Chapter 3 of this Guide. Completed loan packages must include all documentation obtained or provided by the Client in originating, processing, underwriting, and closing the loan and must evidence compliance with all investor, agency, insurer and regulatory requirements. The loan must close in the name of the Client, or if applicable, their Gateway prior approved d/b/a or affiliate (as those terms are defined by the applicable Investor, Insurer or Agency). No documents are to be drawn in the name of Gateway. All documents must be free of whiteouts, erasures and all borrowers must initial any corrections made. Documents must conform in all respects with FNMA, GNMA, FHA, VA, USDA, ONAP Section 184 or USDA Investor, Insurer, Agency and document custodial requirements, as applicable for the loan product and terms. Gateway relies upon the Client s representations and warranties that all loans are fully negotiable and enforceable and can be serviced in accordance with the terms of Gateway s Correspondent Loan Purchase and Sale Agreement ( Agreement ). Client agrees to indemnify and hold harmless Gateway from any claims, damages or losses suffered or otherwise incurred by Gateway which arise in whole or in part from any breach of the representations and warranties contained in this Guide or the Agreement. Client further agrees that all determinations made by Gateway regarding whether a breach of these representations and warranties occurred shall be final. Client further represents and warrants that the loans fully comply with all applicable federal, state and local laws and regulations, including licensing requirements for the Client and other parties involved in the origination of each loan. To avoid suspensions that create avoidable purchase delays, please be sure to: Coordinate delivery of the imaged loan file with your custodian or warehouse bank s delivery of the original Note. Have any new warehouse lines and/or wire instructions prior approved by Gateway Client Administration prior to delivery of loans. Ensure that borrower names and property addresses are identical on the Note, Mortgage/Security Instrument, Title Commitment, Appraisal, Flood Certificate, AUS findings, and all insurance policies. Re-run AUS prior to closing once final numbers are known. Review AUS findings to make sure file documentation matches last AUS run. Make sure all AUS conditions have been met. Include an explanation of how you calculated qualifying income and assets. If applicable, release the DO findings to Gateway. Upload all required ULDD data to Fannie Mae for conventional loans. Utilize FNMA Early Check Documents necessary to clear suspensions must be delivered by 10 a.m. CST on or before the lock expiration date. 29

30 Loan Delivery and Purchase (cont.) Calculating Interest / For purposes of amortizing payments, Gateway calculates interest using a 30/360 calendar year. For purposes of calculating interest per diem between Gateway and the Client, a 365 day calendar year is used. Delivery of Closed Loan Packages Age of Loan / Prior Rejects The following loans are not eligible for delivery: Loans closed more than 60 days prior to delivery to Gateway. Loans previously rejected by or repurchased from Gateway. Loans previously rejected by or required to be repurchased from or indemnified by FHLMC, FNMA, FHA, ONAP, VA or USDA. Loans previously rejected by or required to be repurchased from a private investor, unless such prior rejection / repurchase is fully and specifically disclosed to Gateway in the loan file and Gateway determines the loan is eligible for purchase regardless of the prior investor s determination. Electronic & Stamped Signatures An electronic or digital signature is one generated by a computer. A stamped signature is one produced by a rubber stamp. Electronic or stamped signatures are eligible on specific documents and loan types and loan types as noted below. All closing documents must be signed (live signatures) by the borrowers and property sellers. Conforming Loans: Electronic signatures are only acceptable on the initial disclosures and the initial 1003 application. FHA Loans: For applications taken on or after 2/10/14, E-Signatures are allowed on the initial 1003 loan application and initial disclosures. The change in policy affects borrower signatures. Loan originators are not permitted to electronically sign the 1003 loan application. Lender must comply with HUD Mortgagee Letter Electronic & digital signatures are allowed on third-party documents and disclosures if permitted by the applicable regulator. Stamped signatures on the sales contract and any addendums by the property seller are acceptable to FHA only when the property seller is Fannie Mae or Freddie Mac (i.e. Fannie Mae/Freddie Mac REO). VA loans: Electronic & digital signatures are allowed on third-party documents and disclosures if permitted by the applicable regulator Stamped signatures on the sales contract and any addendums by the property seller are acceptable to FHA and VA only when the property seller is Fannie Mae or Freddie Mac (i.e. Fannie Mae / Freddie Mac REO). Other Requirements: An indication of the electronic signature and date must be clearly visible when viewed electronically and/or in a paper copy of the electronically signed document. 30

31 Delivery of Closed Loan Packages (cont.) Other Requirements (cont.) Clients must employ the same level of care and due diligence with electronically signed documents that they would for paper documents with wet or ink signatures. Electronic signatures must be in accordance with the Electronic Signatures in Global and National Commerce Act (ESIGN) and the Uniform Electronic Transactions Act (UETA), as applicable. FHA defines third-party documents as those originated and signed outside the lender s control, such as a sales contract, amendatory clause or real estate certification. Third-party documents do not include the HUD-1 or any of its supplements unless the electronic signature is provided by HUD, such as in a HUD property disposition sale. Pre-Signing Documents On purchase and refinance transactions, the closing loan documents can be signed prior to the computer generated date on the documents. The computer generated document date remains the same. The notarization (of the security instrument and other documents that require notarization), however, must match the date the documents are signed by the borrower. On rescindable transactions, the 3 day rescission period begins following consummation, delivery of the Notice of Right to Cancel, or delivery of all material disclosures, whichever occurs last. The rescission period cannot begin until the day the borrowers sign and date the Notice of Right to Cancel. Pre- and Post- Purchase Reviews Gateway has the right, but not the obligation, to perform reviews on loans delivered for purchase. These reviews may be pre-purchase (done before a decision to purchase) or post purchase (done after the loan is purchased). The review selection is weighted to loans determined as having higher risk characteristics. These reviews may or may not include review of all aspects of the loan and may or may not include re-underwriting. Gateway may use fraud detection tools, Early Check, or a similar service to screen any loan. With respect to these reviews, Gateway reserves the right to reject any loan for purchase or to demand repurchase, as applicable, if Gateway determines the loan is not of investment quality or does not otherwise conform to the requirements of the Contract documents. The fact that Gateway has conducted or not conducted any partial or complete review of a loan before purchasing it, including, without limitation, underwriting or not underwriting the loan, shall not affect Gateway s rights and remedies and the Client s obligations, liabilities, representations, or warranties under the Contract Documents, this Guide or the Agreement, including without limitation, the Client s repurchase and indemnification obligations. Refer also to your Correspondent Loan Purchase and Sale Agreement. Delivering Loan Packages Loan packages (excluding original Notes, Bailee Letters / Wire Instructions, and the Trailing Documentation as detailed later in this Guide) must be delivered to Gateway s Correspondent Operations Center utilizing our website s image delivery system at 31

32 Delivering Loan Packages (cont.) Images must be in PDF Format. No specific stacking order is required. All documentation obtained by the Client in originating, processing, underwriting and closing the loan must be delivered to Gateway. All documents must be in form and content acceptable to the applicable investor, Agency, insurer and regulator(s). This section includes only information related to specific Gateway requirements that differ from or expand upon investor, Agency, insurer, and regulatory requirements. Gateway may determine for legal, secondary marketing, or other reasons that other original documents must be delivered. Upon such determination, the Client is required to deliver the original documents. Purchase Requirements Balance & Payment Amortized The first payment due Gateway is based on when the file is scheduled for purchase by Gateway and the date of the first payment. All first payments are amortized for loans scheduled for purchase after the 14th of the month. If the 14th falls on a weekend or holiday, Gateway will use the previous business day as the amortization cutoff date. Examples: IF the scheduled purchase date is on or prior to the 14th of the month, on or after the 15th of the month, on or after the 15th of the month, AND the first payment is due on the first of the following month or the month after that, Example: Scheduled purchase date: March 14th; First payment due either April 1st or May 1st first of the following month, Example: Scheduled purchase date: March 15th; First payment due: April 1st the month after the following month, Example: Scheduled purchase date: March 15th; First payment due May 1st THEN the loan will NOT be amortized the loan will be purchased at the original principal balance Gateway will begin immediately servicing the loan the Client is responsible for collecting the first payment and continuing to service it until the first payment is due Gateway the amount of the first payment will be netted out of the Purchase Advice the loan will be amortized one time, and the loan will be purchased at the original principal balance less one payment (including escrows if applicable) the loan will NOT be amortized the loan will be purchased at the original principal balance Gateway will begin immediately servicing the loan 32

33 Fees Refer to the Gateway Rate Sheet in effect as of the loan s Lock Date for the amount of Gateway s administrative, tax service, flood determination, and other fees (if specified). Fees due Gateway will be netted from the loan funding wire. Additionally, any applicable loan level specific passthrough delivery fees due the investor will be net funded (e.g., FNMA PIW fee). Purchase Advice Gateway s Purchase Advice will reflect the detailed calculation of the net amount funded. Once a Purchase Advice is generated, it will be posted to our website for the Client s access at www. GatewayCorrespondent.com. Funds are wired to the Client or their designated warehouse bank. (See also the Bailee Letter/Wire Instructions sections of this Chapter and the Warehouse Bank section of Chapter 2.) The Client is urged to reconcile purchase advices and wires on a daily basis and report any discrepancies immediately to their Gateway Correspondent Client Liaison. See also the Post-Purchase Documentation section of this Chapter regarding actions that Original Collateral Package Documentation Note The original Note (and any applicable original Note Riders or Addenda) must be delivered, along with the applicable Gateway prior-approved Wiring Instructions and/or warehouse bank s Bailee letter to: Gateway Mortgage Group, LLC Attention: Correspondent Note Custodian 6910 East 14th Street Tulsa, OK Original Notes (including any applicable required Note Riders or Addenda) are always required; Gateway does not accept lost Note affidavits or Notes marked as duplicate original, corrected Note, replacement Note or similar verbiage. Gateway will complete its pre-purchase audit based on the original Note document(s) delivered to the Gateway Note Custodian at the above address. Clients must use the current and correct uniform Note as required by the applicable investor or agency. Click here to access Fannie Mae s current list of uniform Note instruments for conventional loans. 33

34 Original Collateral Package Documentation (cont.) Note Endorsement or Allonge The Note must have a complete endorsement chain ending with Gateway Mortgage Group, LLC. Any intervening or canceled endorsements require a written explanation and may result in the loan being ineligible for purchase as provided in the Age of Loan / Prior Rejects section of this Chapter. The correspondent Client name on the face of the Note and in the endorsement language must match exactly and must also be the exact Client entity prior approved by Gateway. Only those officers authorized on the most recent Corporate Resolution approved by Gateway may execute the endorsement. The endorsement should appear on the Note if there is sufficient room on the Note. An Allonge may be used for the endorsement as long as the following requirements are met: The form and content of the Allonge must comply with all applicable state, local, or federal law governing the use of Allonges and result in an enforceable and proper endorsement to the Note. The Allonge must be permanently affixed to the related Note and must clearly identify the Note by referencing at least the name of the borrower(s), the date of the Note, the amount of the Note, and the address of the security property. Any subsequent endorsement should also be placed on the Allonge. The endorsement language must read materially as follows: Pay to the order of Gateway Mortgage Group, LLC without recourse (Client / Lender printed name) By: (Signature of Authorized Officer) Name: (Printed) Title: (Printed) 34

35 Original Collateral Package Documentation (cont.) Bailee Letter / Wire Instructions Gateway requires that a Bailee Letter be submitted with the delivery of the original Note. Clients that are regulated depository institutions, or that have a regulated depository parent, may deliver Wire Instructions in lieu of the Bailee Letter. Gateway will complete its pre-purchase audit based on the original Note document(s) delivered to the Gateway Note Custodian at the above address. Do not include a copy of the Note in the imaged file upload. As part of the Client approval process, and prior to Gateway wiring any funds, Gateway has the right to confirm the bank account wiring information. Once confirmed, the information is entered into the Client s record on Gateway s correspondent systems. This process takes approximately five business days. If an original Note is delivered without wire instructions, or if the wire instructions delivered do not match the approved instructions on Gateway s system, the loan will be suspended. The suspension will not be cleared until approved wiring instructions, signed by an authorized signer, as named on the RESOLUTION OF BOARD OF DIRECTORS AND CERTIFICATE OF SECRETARY form, are received, processed, and entered into Gateway s system. To deactivate previously authorized wire transfer instructions, an authorized officer of the Client, as named on the RESOLUTION OF BOARD OF DIRECTORS AND CERTIFICATE OF SECRETARY form, must complete and sign a Deactivation of Wire Instructions form letter. 35

36 Original Collateral Package Documentation (cont.) Powers of Attorney Powers of Attorney ( POAs ) are acceptable during the processing and closing of a loan transaction if they meet applicable legal, title insurer and program guidelines. If a Power of Attorney is used by a borrower to execute the Note, the original recorded POA or a certified copy of the original POA which has been sent for recording with the Security Instrument, must be attached to the Note. For all loans, a copy of the original POA must also be included within the imaged loan file delivery. When signing documents under a Power of Attorney, the words attorney-in-fact must appear as part of the signature line. An example of an acceptable signature line for documents executed under a Power of Attorney is: (Signature Line) (Typed Name) John Public by Jane Public, his Attorney-in-Fact (Jane would sign as John Public by Jane Public, his Attorney-in-Fact ) All POAs must also: comply with applicable state law and Agency and/or Investor requirements be accepted by the title insurer; no POA related title policy exception or coverage limitation is allowed be recorded prior to or concurrently with the Security Instrument be signed and dated by the party granting the POA be signed by an appropriate witness (if required by applicable state law) specifically identify the subject property by legal description matching the Security Instrument specifically provide for the execution of any and all documents pertaining to the mortgaging of real property be in effect on the date of signing be notarized be irrevocable even upon disability or incapacity of the granting party not be granted to an interested party to the transaction (e.g. realtor, broker, seller, closing agent) For Conventional and FHA loans the initial loan application may not be executed using the POA if the POA is used to execute the final loan application (e.g. either the initial or final application must be signed by all Borrowers). 36