Banc Home Loans. 2.2 Representations and Warranties Respecting the Individual Mortgage Loans. Exhibit A

Transcription

1 Banc Home Loans Section 2.2 Representations and Warranties Respecting the Individual Mortgage Loans Exhibit A 2.2 Representations and Warranties Respecting the Individual Mortgage Loans Seller makes the representations, warranties and covenants contained in this Section 2.2 as to each Mortgage Loan sold by Seller to the Bank as of the respective dates of the MLPA and each Commitment Confirmation, and as of each Purchase Date or other dates set forth in this Guide, the MLPA or any Commitment Confirmation. Seller acknowledges and agrees to the following: 2.2.a Ownership of Mortgage Loan. Seller is the sole legal, beneficial and equitable owner and holder of the Mortgage Loan (and related Mortgage Loan Documents) and is the custodian of the related Escrow Account, if applicable. The Mortgage Loan has neither been assigned nor pledged, Seller has good and marketable title thereto, has full right to transfer and sell the Mortgage Loan to the Bank free and clear of any encumbrance, equity, lien, pledge, charge, claim or security interest (other than Permitted Encumbrances), and has full right and authority, subject to no interest or participation of, or agreement with, any other party, to sell and assign the Mortgage Loan to the Bank pursuant to the terms of the Agreement. Immediately following the transfers and assignments contemplated in the Agreement, Seller shall have transferred and sold all of its right, title and interest in and to the Mortgage Loan and the Bank will hold good, marketable and indefeasible title to, and be the sole legal, beneficial and equitable owner and holder of, the Mortgage Loan subject to no encumbrance, equity, lien, pledge, charge, claim or security interest (other than Permitted Encumbrances). 2.2.b Valid First Lien. The Mortgage is properly recorded and is a valid, existing, enforceable and perfected first lien on the Mortgaged Property, including all buildings and improvements on the Mortgaged Property, and all installations and mechanical, electrical, plumbing, heating and air conditioning systems located in or annexed to such buildings, and all additions, alterations and replacements made at any time with respect to the foregoing. 2.2.c Validity of Mortgage Loan Documents. The Mortgage Loan Documents are genuine and complete in all respects and each is the Mortgagor s legal, valid, and binding obligation enforceable in all respects in accordance with its terms except as enforceability may be limited by bankruptcy, insolvency, reorganization, receivership or other similar laws affecting creditors rights generally from time to time in effect and general principles of equity, and Seller has taken all action necessary to transfer such rights of enforceability to the Bank. All parties to the Mortgage Note and related Mortgage had legal capacity to enter into the Mortgage Loan, to execute and deliver the Mortgage Note and related Mortgage, and did duly and properly execute the Mortgage Note and related Mortgage. 2.2.d Customary Provisions. The Mortgage Note and related Mortgage are on forms acceptable for sale and securitization to the Agencies, conform to the requirements of the Agreement and contain customary and enforceable provisions such as to render the rights and remedies of the holder thereof adequate for the realization against the Mortgaged Property of the benefits of the security provided thereby, including (i) in the case of a Mortgage designated as a deed of trust by 1

2 trustee s sale, and (ii) otherwise by judicial or non-judicial foreclosure. Upon default by a Mortgagor on a Mortgage Loan and foreclosure on, or trustee s sale of, the Mortgaged Property pursuant to the proper procedures, the holder of the Mortgage Loan will be able to deliver good and merchantable title to the Mortgaged Property. There is no homestead or other exemption or right available to the Mortgagor or any other Person or restriction on Seller or any other Person, including without limitation, any federal, state or local, law, ordinance, decree, regulation, guidance, attorney general action, or other pronouncement, whether temporary or permanent in nature, which would interfere with, restrict or delay, the ability of Seller, the Bank, any servicer or any successor to any of them, to (i) sell the Mortgaged Property at a trustee s sale or otherwise, or (ii) foreclose on the related Mortgage. 2.2.e Original Terms Unmodified. The terms of the Mortgage Note and the Mortgage have not been impaired, waived, altered or modified in any respect, except by written instruments that are in the Mortgage Loan File and have been or will be recorded, if necessary to protect the interests of the Bank, and that have been delivered to the Bank, all in accordance with the Agreement. The substance of any such waiver, alteration or modification has been approved by the primary mortgage guaranty insurer, if any, and by the title insurer, to the extent required by the related policy, its terms are reflected on the Loan Submission Form, and has been approved in writing by the Bank. No Mortgagor has been released, in whole or in part and no Mortgage Loan is subject to an assumption agreement. 2.2.f Trustee for Deeds of Trust. If the Mortgage constitutes a deed of trust, a trustee, duly qualified under Applicable Law to serve as such, has been properly designated and currently so serves and is named in the Mortgage, and no fees or expenses are or will become payable by the Bank to the trustee under the deed of trust, except in connection with a trustee s sale after default by the Mortgagor or reconveyance of the deed of trust. 2.2.g No Arbitration. None of the Mortgage Loan Documents or other documents evidencing or securing the Mortgage Loan provide for or contain an arbitration clause of any kind, or require any other non-judicial procedure to resolve any controversy or settle any claims arising out of the Mortgage Loan. 2.2.h No Defenses. The Mortgage Note and related Mortgage are not subject to any right of rescission, set-off, counterclaim or defense, including, without limitation, the defense of usury, and the operation of any of the terms of the Mortgage Note and related Mortgage, or the exercise of any right thereunder, will not render either the Mortgage Note or related Mortgage unenforceable, in whole or in part, or subject to any right of rescission, set-off, counterclaim or defense, including, without limitation, the defense of usury, and no such right of rescission, set-off, counterclaim or defense has been asserted with respect thereto. 2.2.i Recordation and Transfer of Mortgage Loans. Each original Mortgage was recorded and, except for those Mortgage Loans subject to the MERS System, all subsequent assignments of the original Mortgage (other than the assignment to the Bank) have been recorded in the appropriate jurisdictions wherein such recordation is necessary to perfect the lien thereof as against creditors of Seller, or is in the process of being recorded. If the Mortgage is not subject to the MERS System, the Assignment of Mortgage, upon the insertion of the name of the assignee and recording information, is in state specific recordable form (other than the name of the assignee if in blank) and is acceptable for recording under the laws of the jurisdiction in which the related Mortgaged Property is located. 2

3 2.2.j With respect to each MERS Designated Mortgage Loan: (i) Seller was at the time or origination and is currently a member of MERS in good standing, and has complied with the rules and procedures of MERS in connection with the Mortgage Loans registered with the MERS System; (ii) Seller has not received any notice of liens or legal actions with respect to such Mortgage Loan and no such notices have been electronically posted by MERS; (iii) a MIN has been assigned by MERS and such MIN has been accurately provided to the Bank in the Mortgage Loan File; (iv) the related assignment of Mortgage to MERS has been duly and properly recorded; and (v) Seller has or will within the timeline required in the Agreement, designate the Bank as the MERS Investor and no Person is listed as interim funder on the MERS System. 2.2.k Fictitious Names. To the extent Seller is operating under a Fictitious Name or DBA in connection with the origination of any Mortgage Loan: (i) any Mortgage Loan Document bearing Seller s Fictitious Name or DBA is a legal, valid and binding obligation of the obligor(s) thereunder; (ii) such Mortgage Loan is not subject to any defense, claim, or right of rescission of the obligor(s), due to the use of such Fictitious Name or DBA; (iii) the validity, enforceability, effectiveness of recording or priority of the related Mortgage is in no way affected by the use of Seller s Fictitious Name or DBA; (iv) the transfer or assignment of the Mortgage Loan or Mortgage Loan Documents to the Bank confers upon the Bank, the legal right of ownership and enforceability of any such Mortgage Loan or Mortgage Loan Documents; and (v) such Fictitious Name or DBA has been properly disclosed to and approved by the Bank prior to the use of such name in any transaction involving the Bank. 2.2.l Title Insurance. The Mortgage Loan is covered by an ALTA or CLTA lender s title insurance policy, acceptable to the Agencies, issued by a title insurer acceptable to the Agencies and qualified to do business in the jurisdiction where the Mortgaged Property is located, insuring Seller, its successors and assigns as to the first priority lien of the Mortgage in the original principal amount of the Mortgage Loan and, with respect to ARM Mortgage Loans, against any loss by reason of the invalidity or unenforceability of the lien resulting from the provisions of the Mortgage providing for adjustment in the Mortgage Interest Rate or Monthly Payment. Where required by state law or regulation, the Mortgagor has been given the opportunity to choose the carrier of the required mortgage title insurance. Additionally, such lender s title insurance policy affirmatively insures ingress and egress, and against encroachments by or upon the Mortgaged Property or any interest therein. Seller and its successors and assigns are the sole insureds of such lender s title insurance policy, and such lender s title insurance policy is in full force and effect and will be in full force and effect upon the consummation of the transactions contemplated by the Agreement and will inure to the benefit of the Bank and its assigns without any further act. No claims have been made under such lender s title insurance policy, and no prior holder of the related Mortgage, including Seller, has done, by act or omission, anything which would impair the coverage of such lender s title insurance policy. 2.2.m No Delinquency. The Mortgagor has made and Seller has credited all payments required to be made under the terms of the Mortgage Note through the Purchase Date. No payment required under the Mortgage Loan is currently fifteen (15) days or more delinquent on the Purchase Date and no payment under the Mortgage Loan has been thirty (30) days or more delinquent at any time since the origination of the Mortgage Loan. 2.2.n No Outstanding Charges. The Mortgagor has not defaulted under the Mortgage Loan Documents, and has paid any and all taxes, including, without limitation, any and all transfer taxes due and payable to any state or municipality relating to the Mortgaged Property s 3

4 transfer of ownership and occupancy interest. There are no delinquent charges and the Mortgagor has paid all governmental assessments, insurance premiums, water, sewer and municipal charges, leasehold payments and ground rents and other charges that previously became due and owing or will become due and owing within forty five (45) days of the Purchase Date, or the Mortgagor has established an escrow account sufficient to pay such charges. 2.2.o No Litigation Pending. There is no action, suit, proceeding or investigation pending, or to Seller s knowledge, threatened, that is related to the Mortgage Loan. 2.2.p No Satisfaction of Mortgage. The Mortgage has not been satisfied, canceled, subordinated or rescinded, in whole or in part, and the Mortgaged Property has not been released from the lien of the Mortgage, in whole or in part, and no instrument has been executed that would affect any such release, cancellation, subordination or rescission. 2.2.q No Defaults. There is no default, breach, violation or event of acceleration (monetary or otherwise) existing under the Mortgage Note or related Mortgage and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute a default, breach, violation or event permitting acceleration, and Seller has not waived any default, breach, violation or event permitting acceleration. Seller has not waived the performance by the Mortgagor of any action, if the Mortgagor s failure to perform such action would cause the Mortgage Loan to be in default. No foreclosure action is currently being threatened or has begun with respect to the Mortgage Loan. 2.2.r Full Disbursement of Proceeds. The Mortgage Loan has been closed and the full principal amount of the Mortgage Loan proceeds have been fully disbursed to or for the account of the Mortgagor and there is no obligation for the mortgagee to advance additional funds thereunder. All costs, fees, and expenses incurred in making or closing the Mortgage Loan and the recording of the Mortgage have been paid, and the Mortgagor is not entitled to any refund of any amounts paid or due to the mortgagee pursuant to the Mortgage Note or related Mortgage other than escrow holdbacks, if applicable. Except for a Rehabilitation/Construction Mortgage Loan any and all requirements as to completion of any on site or off site improvement and as to disbursements of any escrow funds therefor have been complied with and the completion certification (Freddie Mac Form 442 or Agencyacceptable equivalent) is in the Mortgage Loan File. 2.2.s No Advances. Seller has not advanced funds, or induced, solicited or knowingly received any advance of funds from a party other than the Mortgagor, directly or indirectly, for the payment of any amount required under the Mortgage Loan. As of the Closing Date, the full original principal amount of each Mortgage Loan has been fully disbursed as provided for in the Mortgage Loan Documents, and there is no requirement for any future advances. 2.2.t No Mechanic s Liens. There are no mechanic s, materialmen s or similar liens, encumbrances or claims that have been filed for work, labor or material (and no rights are outstanding that under law could give rise to such liens) affecting the related Mortgaged Property which are or may be liens prior to, or equal or coordinate with, the lien of the related Mortgage. 2.2.u Origination. The Mortgage Loan was originated by a mortgagee approved by the Secretary of Housing and Urban Development pursuant to Sections 203 and 211 of the National Housing Act, a savings and loan association, a savings bank, a commercial bank, credit union or other 4

5 entity which is supervised and examined by a federal or state authority. Seller and all other parties which have had any interest in the Mortgage Loan on or prior to the Closing Date, whether as mortgagee, assignee, pledgee or otherwise, are (and, during the period in which they held and disposed of such interest, were) in compliance with any and all applicable doing business, licensing or other requirements of the laws of the state wherein the Mortgaged Property is located. 2.2.v Non Traditional Mortgage Loan. Each Mortgage Loan that is a nontraditional mortgage loan within the meaning of the Interagency Guidance on Nontraditional Mortgage Product Risk, 71 FR 58609, complies in all respects with such guidance, including any interpretations, applications or implementation plans with respect thereto that have been communicated and/or agreed to by a regulator of the originator of the Mortgage Loan. 2.2.w Payment Terms. Principal payments on the Mortgage Loan, other than an Interest Only Mortgage Loan, were required to commence no more than sixty (60) days after the proceeds of the Mortgage Loan were disbursed. The Mortgage Loan has an original term to maturity of not more than thirty (30) years. The Mortgage Note does not permit negative amortization. Interest on the Mortgage Note is calculated on the basis of a 360 day year consisting of twelve 30 day months. The Mortgage Loan is not a Convertible Mortgage Loan, Simple Interest Mortgage Loan, Balloon Mortgage Loan, Shared Appreciation Mortgage Loan or Buydown Mortgage Loan. 2.2.x Adjustments. All of the terms of the related Mortgage Note pertaining to interest rate adjustments, payment adjustments and adjustments of the outstanding principal balance, if any, are enforceable and such adjustments will not affect the priority of the lien of the related Mortgage. All such adjustments on such Mortgage Loan have been made properly and in accordance with the provisions of such Mortgage Loan and Applicable Law. 2.2.y No Graduated Payment or Contingent Interests. No Mortgage Loan contains provisions pursuant to which Monthly Payments are (a) paid or partially paid with funds deposited in any separate account established by Seller, the Mortgagor, or anyone on behalf of the Mortgagor, or (b) paid by any source other than the Mortgagor. The Mortgage Loan is not a graduated payment Mortgage Loan and the Mortgage Loan does not have a shared appreciation or other feature providing for contingent interest or principal. 2.2.z Construction Mortgage Loan. Except for a Rehabilitation/Construction Mortgage Loan, the Mortgage Loan was not made in connection with (i) the construction or rehabilitation of the Mortgaged Property or (ii) facilitating the trade-in or exchange of a Mortgaged Property. 2.2.aa Due on Sale Clause. The Mortgage contains an enforceable provision for the acceleration of the payment of the unpaid principal balance of the Mortgage Loan in the event the related Mortgaged Property is sold without the prior consent of the mortgagee thereunder. 2.2.bb LTV, Private Mortgage Insurance Policy. At the time of origination, the loan-tovalue (LTV) of the Mortgage Loan does not exceed the maximum LTV permitted by the Program Guides. The Mortgage Loan, if applicable, is covered by a private mortgage insurance policy (PMI Policy) as required by the Program Guides. All provisions of such PMI Policy have been and are being complied with. Such PMI Policy is valid, binding, and enforceable, is in full force and effect, all premiums due thereunder have been paid, and the form and substance of such PMI Policy is in conformance with 5

6 primary mortgage insurance policies acceptable to the Agencies. None of Seller, the related originator (if other than Seller), any servicer or any other Person has done, by any act or omission, anything which would impair the coverage of such PMI Policy, the benefits of the endorsements, or the validity and binding effect thereof. No action, inaction, or event has occurred and no state of facts exists that has, or will, result in the exclusion from, denial of, or defense to coverage of such PMI Policy. In connection with the issuance of such PMI policy, no unlawful fee, commission, kickback or other compensation or value of any kind has been or will be provided received, retained or realized by any of Seller, the related originator (if other than Seller), any servicer or any other Person (including, but not limited to any attorney, firm or other entity) or any of their Affiliates or assigns. The insurer under such PMI Policy is a Qualified Insurer at the time of origination and as of the Purchase Date. Any Mortgage Loan subject to a Mortgagor paid PMI Policy obligates the Mortgagor thereunder to maintain the PMI Policy and to pay all premiums and charges in connection therewith up to the time it may be discontinued according to Applicable Law. No Mortgage Loan requires payment of such premiums, in whole or in part, by the Bank. The Mortgage Interest Rate for the Mortgage Loan does not include any such insurance premium. 2.2.cc Optional Insurance. Seller and its Third Party Originators have not financed, directly or indirectly, premiums or fees for single premium credit life, disability or unemployment insurance products, or any other accident, loss-of-income, life or health insurance, with the proceeds of the Mortgage Loan, and no Mortgagor was required to purchase any single premium credit insurance policy or debt cancellation agreement as a condition of obtaining the extension of credit. None of the Mortgage Loans has a single premium credit life, disability or unemployment insurance products, or any other accident, loss-of-income, life or health insurance. No loan has any type of optional insurance in place as of the Purchase Date that is escrowed or requires servicing. 2.2.dd Appraisal. If required under the applicable Program Guides, the Mortgage Loan File contains an appraisal(s) or property valuation(s) relating to the Mortgaged Property, in a form acceptable to the Agencies. Any appraisal(s) or property valuation(s) prepared in connection with a Mortgaged Property (i) complies with the requirements of FIRREA, provides an accurate estimate of the bona fide market value of such Mortgaged Property at the time of origination, and, when an appraisal is required, was prepared by a Qualified Appraiser, (ii) complies in all respects with all applicable appraiser independence requirements, restrictions and guidelines including those contained in the Appraiser Independence Requirements as adopted by Fannie Mae or Freddie Mac and the Appraisal Independence Requirements set forth in Title XIV, Subtitle F, Section 1472 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No (adding Section 129E to the Truth in Lending Act 15 U.S.C et seq.) and any regulations promulgated pursuant thereto, and (iii) complies with the applicable requirements, restrictions, and guidelines contained in the Agreement. 2.2.ee Type of Mortgaged Property. The Mortgaged Property is a fee simple or leasehold property located in the state identified in the Mortgage File and consists of a single parcel of real property with, erected thereon, a detached single family residence, condominium, planned unit development, a two- to four-family dwelling, or such other dwelling conforming to the Program Guides and all applicable Agency requirements regarding such dwelling. No portion of the Mortgaged Property is used for commercial purposes in such a manner that knowledgeable and sophisticated investors active in the residential secondary mortgage market would consider the Mortgaged Property commercial, rather than residential, property. The Mortgage Loan is not secured by a Manufactured Home or mobile home, regardless of whether such Manufactured Home or mobile home has been converted to real property, is permanently affixed to real property, or has had its title 6

7 certificate cancelled or surrendered. The Mortgaged Property is not (i) an agricultural property, (ii) a log home, (iii) a geodesic dome, (iv) a Co-operative or (v) a unique, exotic or non-traditional property type which is not explicitly permitted pursuant to the Program Guides. If the Mortgage Loan is secured by a long-term residential lease, such Mortgage Loan and the related long-term residential lease both satisfy all applicable requirements of the Program Guides. 2.2.ff Occupancy of the Mortgaged Property. The Mortgaged Property is lawfully occupied under Applicable Law. All inspections, licenses and certificates required to be made or issued with respect to all occupied portions of the Mortgaged Property and, with respect to the use and occupancy of the same, including but not limited to certificates of occupancy, have been made or obtained from the appropriate authorities and no improvement located on or part of the Mortgaged Property is in violation of any zoning law or regulation. In connection with the origination of the Mortgage Loan, the originator gave due consideration to factors, including, but not limited to, other real estate owned by the Mortgagor, the commuting distance to work, appraiser comments and notes, the location of the Mortgaged Property and any difference between the mailing address active in the servicing system and the Mortgaged Property address, to evaluate whether the occupancy status of the Mortgaged Property as represented by the Mortgagor was reasonable. 2.2.gg Location of Improvements; No Encroachments. All improvements considered in determining the Appraised Value of the Mortgaged Property at origination lie wholly within the Mortgaged Property's boundaries and building restriction lines and no improvements on adjoining properties encroach upon the Mortgaged Property (except those encroachments which the title insurer has affirmatively insured over). No improvement located on or being part of the Mortgaged Property is in violation of any applicable zoning law or regulation. All Mortgaged Property improvements, including new construction, have been completed in full compliance with any Applicable Laws, regulations or building codes and standards, and the improvements comply with the laws, regulations, or building codes and standards as of the Purchase Date. 2.2.hh No Additional Collateral. The Mortgage Note is not and has not been secured by any collateral except the lien of the corresponding Mortgage on the Mortgaged Property and the security interest of any applicable security agreement or chattel mortgage, the existence of which Seller has previously disclosed to the Bank and the Bank has approved in writing. 2.2.ii Mortgaged Property Undamaged; No Condemnation Proceedings. The Mortgaged Property is undamaged by waste, fire, earthquake or earth movement, windstorm, flood, tornado or other casualty so as to affect adversely the Mortgaged Property s value as security for the Mortgage Loan or the use for which the premises were intended or would render the property uninhabitable. The Mortgaged Property meets program guidelines. There are no condemnation proceedings by any federal, state, or local authority pending or threatened against the Mortgaged Property. 2.2.jj Construction Defects. Any home or other improvement included within the Mortgaged Property was constructed in a workmanlike manner, and was accepted by the Mortgagor in good and habitable condition and working order, and conforms with all warranties, express or implied, representations, legal obligations, and local, state and federal requirements and codes concerning the condition, construction, and placement of the home or improvement. 7

8 2.2.kk Environmental Matters. There is no pending action or proceeding directly involving any Mortgaged Property in which compliance with any environmental law, rule or regulation is an issue and nothing further remains to be done to satisfy in full all requirements of each such law, rule or regulation constituting a prerequisite to use and enjoyment of such Mortgaged Property. The Mortgaged Property is free from any and all toxic or hazardous substances and there exists no violation of any local, state or federal environmental law, rule or regulation. No amount of any Hazardous Substance has been disposed of or identified on, under or at the Mortgaged Property. 2.2.ll Flood and Hazard Insurance. All buildings or other customarily insured improvements upon the Mortgaged Property are insured by a Qualified Insurer generally acceptable to the Agencies and to prudent mortgage lending institutions against loss by fire, hazards of extended coverage and such other hazards as are required in the Agency Guides as well as all additional requirements set forth herein, pursuant to an insurance policy conforming to the requirements of customary servicing procedures and providing coverage in an amount equal to the lesser of (i) the full insurable value of the Mortgaged Property as determined by the property insurer, or (ii) the greater of (A) the unpaid principal balance owing on the Mortgage Loan, or (B) 80% of the insurable value of the improvements required to compensate for damage or loss on a replacement cost basis. All such insurance policies are in full force and effect and contain a standard mortgagee clause naming Seller, its successors and assigns as mortgagee and all premiums thereon have been paid. If the Mortgaged Property is in an area identified on a flood hazard map or flood insurance rate map issued by the Federal Emergency Management Agency as having special flood hazards, a flood insurance policy meeting the requirements of the current guidelines of the National Flood Insurance Program and the requirements of the Agencies is in place. The Mortgage obligates the Mortgagor thereunder to maintain all such insurance at the Mortgagor s cost and expense, and on the Mortgagor s failure to do so, authorizes the holder of the Mortgage to maintain such insurance at the Mortgagor s cost and expense and to seek reimbursement therefor from the Mortgagor. Where required by state law or regulation, the Mortgagor has been given an opportunity to choose the carrier of the required hazard insurance, provided the policy is not a master or blanket hazard insurance policy covering the common facilities of a planned unit development or condominium. The hazard and/or flood insurance policy is the valid and binding obligation of the insurer, is in full force and effect, and will be in full force and effect and inure to the benefit of the Bank upon the consummation of the transactions contemplated by the Agreement. Seller has not engaged in, and has no knowledge of the Mortgagor having engaged in, any act or omission which would impair the coverage of any such policy, the benefits of the endorsement provided for herein, or the validity and binding effect of either, including, without limitation, no unlawful fee, commission, kickback or other unlawful compensation or value of any kind has been or will be received, retained or realized by any attorney, firm or other person or entity, and no such unlawful items have been received, retained or realized by Seller. 2.2.mm No Impairment of Insurance Coverage. All required insurance policies, of whatever type, remain in full force and effect. Neither Seller nor any prior holder has engaged in any act or omission which would impair the coverage validity or binding effect of any such policies. No action, inaction, or event has occurred and no state of facts exists or has existed that has resulted or will result in the exclusion from, denial of, or defense to coverage under any applicable insurance, including any flood and/or hazard insurance policy, title insurance policy or PMI Policy, irrespective of the cause of such failure of coverage. In connection with the placement of any such insurance, no commission, fee, or other compensation has been or will be received by Seller, or any designee of Seller, or any entity in which Seller, or any officer, director, or employee of Seller had a financial interest at the time of placement of such insurance. 8

9 2.2.nn No Fraud. No fraud, error, omission, misrepresentation, negligence or similar occurrence with respect to the Mortgage Loan has taken place on the part of Seller, the Mortgagor, or any other Person, including without limitation, any originator, appraiser, builder, developer, closing or settlement agent, closing attorney, loan officer, escrow agent, servicer, broker, correspondent, title company, realtor, or any other party, with respect to (i) the origination, sale or servicing of the Mortgage Loan, (ii) the application for any insurance in relation to such Mortgage Loan, (iii) the sale of such Mortgage Loan to the Bank, or (iv) any other action or inaction that would impair in any way the rights of the Bank in such Mortgage Loan or related Mortgaged Property, or that violated Applicable Law. The documents, instruments and agreements submitted for loan underwriting were not falsified and contain no untrue statement of material fact or omit to state a material fact required to be stated therein or necessary to make the information and statements therein not misleading. Seller has reviewed all of the documents constituting the Mortgage Loan File and has made such inquiries as it deems necessary to make and confirm the accuracy of the representations set forth herein. 2.2.oo Unacceptable Investment. There is no circumstance or condition with respect to the Mortgage, the Mortgaged Property, the Mortgagor, or the Mortgagor s credit standing, that can reasonably be expected to cause the Bank or investors to regard the Mortgage Loan as an unacceptable investment, cause the Mortgage Loan to become Delinquent or adversely affect the Mortgage Loan s value or marketability. 2.2.pp Compliance with Agency Requirements and Applicable Laws. All requirements, directions or guidance of the Agencies or the Bank applicable to the Mortgage Loans or to the origination, sale or sourcing of the loans, and any and all requirements of any Applicable Laws have been complied with and the consummation of the transactions contemplated hereby will not involve the violation of any such Applicable Laws. Seller maintains, and shall maintain, evidence of such compliance as required by Applicable Law, regulation or Agency requirements, and shall make such evidence available for inspection at Seller s office during normal business hours upon reasonable advance notice. For all Mortgage Loans originated under either the Fannie Mae or Freddie Mac conventional mortgage programs, all warranties, representations and obligations required under the Agencies respective selling programs, including but not limited to rules imposed by the Federal Housing Finance Agency (FHFA), are hereby referenced, made a part of, and incorporated in their entirety into the Agreement. For all Mortgage Loans underwritten to Fannie Mae or Freddie Mac guidelines, the Mortgage Loan was underwritten in accordance with either Fannie Mae s Selling Guide or Freddie Mac s Seller/Servicer Guide, as applicable, and is otherwise eligible for sale or securitization to one or more GSEs in all respects. For all Mortgage Loans underwritten to FHA or VA guidelines, the Mortgage Loan was underwritten in accordance with FHA or VA guidelines, and the representations, warranties, covenants and other obligations under FHA or VA guidelines are incorporated by reference in their entirety into the Guide. Seller further warrants that each such insurable or guaranteeable Mortgage Loan is eligible for securitization and inclusion in Ginnie Mae pool. 2.2.qq FHA Mortgage Insurance Certificate (MIC); VA Mortgage Loan Guaranty Certificate (LGC). With respect to each FHA Mortgage Loan, Seller has taken all steps required by FHA rules and regulations (including, without limitation, (i) the underwriting and closing of such FHA Mortgage Loan in accordance with HUD Handbooks, HUD Notices, and HUD Mortgagee Letters, and any conditions imposed by the FHA in its firm commitment which relates to such FHA Mortgage Loan 9

10 and (ii) the timely remittance of the related mortgage insurance premium to the FHA in accordance with FHA regulations) which are a prerequisite to the issuance of the FHA MIC and the issuance of such MIC is subject only to the completion of standard FHA clerical procedures. With respect to each VA Mortgage Loan, Seller has taken all steps required by VA rules and regulations (including, without limitation, (i) the underwriting and closing of such VA Mortgage Loan in accordance with the VA Lender s Handbook, VA Loan Guaranty Circulars, and VA Announcements, and any conditions imposed by the VA in its firm commitment which relates to such VA Mortgage Loan and (ii) timely remittance of the related funding fee to the VA in accordance with VA regulations) which are a prerequisite to the issuance of the LGC and the issuance of such certificate is subject only to the completion of standard VA clerical procedures. Each FHA Mortgage Loan and VA Mortgage Loan sold to the Bank meets all requirements and guidelines in effect for such Mortgage Loan as prescribed by FHA (Federal Housing Administration) or VA (Department of Veterans Affairs), as applicable, and the Bank, at the time of purchase by the Bank. 2.2.rr Government Agency Compliance and Third Parties. If a Mortgage Loan is insured or guaranteed by a government agency (including but not limited to FHA and VA), Seller and any third party with whom Seller contracts or otherwise permits to provide a service in connection with a Mortgage Loan complies with all relevant government agency requirements applicable to Seller, to said third party, and to the Mortgage Loan. 2.2.ss Securities Law. Neither Seller nor anyone acting on its behalf has offered, transferred, pledged, sold or otherwise disposed of, or solicited any offer to buy or accept a transfer, pledge or other disposition of or otherwise approached or negotiated with respect to, the Mortgage Loan, any interest in the Mortgage Loan or any other similar security to the Mortgage Loan, with any person in any manner, or made any general solicitation by means of general advertising or in any other manner, or taken any other action which would constitute a distribution of the Mortgage Loans under the Securities Act of 1933, as amended (the Securities Act ) or which would render the disposition of any Mortgage Loans a violation of Section 5 of the Securities Act or require registration pursuant thereto, and Seller will not act, has not authorized and will not authorize any person to act, in such manner with respect to the Mortgage Loans. 2.2.tt Disclosure and Rescission Materials. The Mortgagor has (i) received all disclosure materials required by Applicable Law with respect to the making of Mortgage Loans of the same type as the Mortgage Loan (including with respect to prepayment penalties, limited documentation products, fees and charges, receipt of appraisal copy, and total loan compensation and compensation received by mortgage brokers, as applicable), (ii) received in writing all rescission materials required by Applicable Law, and (iii) acknowledged receipt of such materials and such acknowledgement will remain in the Mortgage Loan File. 2.2.uu Texas Refinance Mortgage Loans. If the Mortgage Loan was a Texas Refinance Mortgage Loan, and allowed by the Program Guides, it has been originated in compliance with the provisions of Article XVI, Section 50(a)(6) of the Texas Constitution, the Texas Civil Statutes and the Texas Finance Code. If the Texas Refinance Mortgage Loan is a Cash-Out Refinance, the related Mortgage Loan Documents state that the Mortgagor may prepay such Texas Refinance Mortgage Loan in whole or in part without incurring a prepayment penalty. Seller has not collected any prepayment penalties in connection with any such Texas Refinance Mortgage Loan. 10

11 2.2.vv Anti-Money Laundering Laws. In connection with the origination and servicing of the Mortgage Loan, Seller and its agents have at all times complied with the Anti-Money Laundering Laws, including without limitation, conducting requisite due diligence, and, maintains, and will maintain, either directly or through third parties, sufficient information to identify the applicable Mortgagor for purposes of the Anti-Money Laundering Laws, as well as file suspicious activity reports as required under the Bank Secrecy Act. The Mortgage Loan is not subject to nullification pursuant to Executive Order or the OFAC Regulations, or in violation of the Executive Order or the OFAC Regulations, and the related Mortgagor is not subject to the provisions of such Executive Order or the OFAC Regulations or listed as a blocked person for purposes of the OFAC Regulations. 2.2.ww Predatory Lending Regulations. The Mortgage Loan is not classified as a High Cost Mortgage Loan. The Mortgage Loan does not have an annual percentage rate or total points and fees payable by the related Mortgagor (as each such term is calculated under HOEPA) that equal or exceed the thresholds set forth by HOEPA and its implementing regulations, including 12 C.F.R (a)(1)(i). No predatory or deceptive lending practices, including, without limitation, the extension of credit without regard to the ability of the Mortgagor to repay and the extension of credit which has no apparent benefit to the Mortgagor, were employed in the origination of the Mortgage Loan. The Mortgage Loan has passed a High Cost Mortgage Test, whether or not they are covered by high cost mortgage regulation, HOEPA (section of Regulation Z), or any state or local high cost, covered or predatory lending law or ordinance. The Mortgage Loan is in compliance with the anti-predatory lending eligibility for purchase requirements in the Agency Guides. 2.2.xx Higher Cost Products. The Mortgagor was not encouraged or required to select a loan product offered by the originator of the Mortgage Loan which is a higher cost product designed for less creditworthy Mortgagors, unless at the time of the Mortgage Loan s origination, such Mortgagor did not qualify for a lower-cost credit product then offered by the originator of the Mortgage Loan taking into account such facts as, without limitation, the Mortgage Loan s requirements and the Mortgagor s credit history, income, assets and liabilities and debt-to-income ratios. 2.2.yy Points and Fees. The Mortgagor was not charged points and fees (whether or not financed) in an amount greater than (i) $1,000, or (ii) 5% of the principal amount of the Mortgage Loan, whichever is greater, as calculated per the provisions of 12CFR (b)(1), irrespective of whether or not the loan is covered under the Ability to Repay Standards. All fees and charges (including finance charges) and whether or not financed, assessed, collected or to be collected in connection with the origination and servicing of the Mortgage Loan has been disclosed in writing to the Mortgagor in accordance with applicable state and federal law and regulation. 2.2.zz Origination Practices. The origination practices used with respect to the Mortgage Loan have been in accordance with Applicable Law, and in each case have been consistent with customary and prudent procedures in the mortgage industry. Seller was both the creditor and lender of the Mortgage Loan, as such terms are used in Dodd-Frank and its implementing rules and regulations. 2.2.aaa Servicing Practices. To the extent the Seller collects monthly payments from borrowers or otherwise services the loan. Seller (or Seller s approved Sub-Servicer) is an approved seller/servicer of conventional residential Mortgage Loans for Fannie Mae or Freddie Mac, and/or a HUD approved mortgagee pursuant to Section 203 of the National Housing Act, with the facilities, procedures and experienced personnel necessary for the sound interim servicing of Mortgage Loans 11

12 of the same type as the Mortgage Loans. No event has occurred, including but not limited to a change in insurance coverage, which would make Seller unable to comply with Fannie Mae, Freddie Mac or HUD eligibility requirements or which would require notification to any of Fannie Mae, Freddie Mac or HUD. Seller is duly qualified, licensed, registered and otherwise authorized under all applicable federal, state and local laws, and regulations, if applicable, meets the minimum capital requirements set forth by HUD, the OCC or the Federal Deposit Insurance Corporation ( FDIC ), as applicable, and is in good standing to enforce, originate, sell Mortgage Loans to the Bank, and service Mortgage Loans in each jurisdiction wherein the Mortgaged Properties are located. The servicing and collection practices used by Seller with respect to the Mortgage Loan have been in all respects legal, proper and prudent in the mortgage servicing business and in accordance with Accepted Servicing Practices, whether such servicing was done by Seller, its Affiliates, or any third party or any Sub-Servicer or servicing agent of any of the foregoing 2.2.bbb Escrow Payments. All Escrow Payments have been collected in full compliance with state and federal law and the provisions of the related Mortgage Note and Mortgage. With respect to any Mortgage Loan that is the subject of an escrow, escrow of funds is not prohibited by Applicable Law and has been established in an amount sufficient to pay for every escrowed item that remains unpaid and has been assessed but is not yet due and payable. All Escrow Payments are in the possession of, or under the control of, Seller, and there exist no deficiencies in connection therewith for which customary arrangements for repayment thereof have not been made. No Escrow Payments or other charges or payments due under the Mortgage Note have been capitalized under any Mortgage or the related Mortgage Note. The Mortgage Loan is not subject to outstanding escrow holdbacks, except those specifically identified by Seller to the Bank. The Mortgage Loan is compliant with the provisions of the TILA (Truth in Lending Act) HPML (Higher Priced Mortgage Loan) Escrow Rule set forth in Regulation Z, if applicable. 2.2.ccc Regarding the Mortgagor. The Mortgagor is one or more (i) natural persons, (ii) trustees for an Illinois land trust, or (iii) a trustee under a living trust, and in the case of a trust such trust is in compliance with Agency requirements and the Program Guides. The Mortgagor is not deceased. The Mortgagor is either a United States citizen or a permanent resident alien who has the right legally to live and work permanently in the United States. Evidence of residency status for a permanent resident alien has been validated by documentation acceptable to the Agencies. 2.2.ddd Tax Identification. Tax identification for the Mortgagor has been certified as required by law. Seller has complied with all IRS requirements regarding the obtainment and solicitation of taxpayer identification numbers and the taxpayer identification numbers submitted to the Bank are correct. 2.2.eee No Bankruptcy. The Mortgagor was not the subject of a bankruptcy proceeding that was dismissed or discharged during time period preceding origination of the Mortgage Loan as set forth in the Program Guides. The Mortgagor was not a debtor in any state or federal bankruptcy or insolvency proceeding at the time the Mortgage Loan was originated or following the date of origination through the Purchase Date, and no such proceedings are pending. The Mortgagor has not previously owned a property with respect to which a foreclosure sale was completed or with respect to which title was conveyed to the originator or a deed in lieu of foreclosure was given in the time period as set forth in the Program Guides. The Mortgaged Property is not subject to any bankruptcy proceeding or foreclosure proceeding. In the event the Mortgagor was a debtor in 12

13 any state or federal bankruptcy or insolvency proceeding and the Mortgage Loan offered for sale to the Bank is a refinance of a loan debt included in such bankruptcy or insolvency proceeding, the loan debt was reaffirmed, to the extent required under the applicable state law and United States Bankruptcy Code, during said proceedings. 2.2.fff Income; Employment; Assets. The originator properly verified the Mortgagor s income, employment and assets in accordance with the Program Guides and employed procedures designed to authenticate the documentation supporting such income, employment and assets. Appropriate assessment and documentation has been performed of the Mortgagor s ability to repay the Mortgage Loan in accordance with its terms as required in Regulation Z, or for Mortgage Loans not covered by Regulation Z, in accordance with any other state and federal laws, rule and regulations and the standards that would be used by a prudent underwriter of Mortgage Loans. 2.2.ggg Verification of Down Payment. The Mortgagor has made any down payment required in connection with the Mortgage Loan, and has received no concession from Seller, the Mortgaged Property seller, or any other third party, unless pursuant to Program Guides. The Mortgagor has contributed at least the applicable percentage (as set forth in the Program Guides) of the purchase price of the related Mortgaged Property with his/her own funds. The source of the down payment with respect to the Mortgage Loan has been fully verified by Seller. For Correspondent Sellers with minimum net worth less than agency requirements (FHA, FNMA, FHLMC), the Bank may require supplemental down payment verification of funds delivered to loan settlement in a form acceptable to the Bank, including but not limited to cashier s check, personal check, wire receipt and other bank transfers. 2.2.hhh Credit Reporting. If applicable, Seller and any predecessor and/or servicer has caused to be fully furnished, as required by the Fair Credit Reporting Act and its implementing regulations, accurate and complete information (i.e., favorable and unfavorable) on its Mortgagor credit files to Equifax, Experian and Trans Union Credit Information Company (three of the credit repositories), on a monthly basis. 2.2.iii No Adverse Selection. No selection procedures were used by Seller that identified the Mortgage Loan as being less desirable or valuable than other comparable mortgage loans in Seller s portfolio. 2.2.jjj GSA and LDP Lists. No person managing or performing any origination function (application through closing) with respect to the Mortgage Loan is on any of the Freddie Mac Exclusionary List, the General Services Administration (GSA) Excluded Party List or the HUD Limited Denial of Participation (LDP) List. 2.2.kkk Electronic Signatures. With respect to any and all documents or records delivered to the Bank which bear an Electronic Signature (subject to the terms and conditions as provided in the Agreement): (i) all Electronic Signatures comply with the standards and requirements of ESIGN and, if applicable, UETA, adopted by the state in which the Electronic Signature is or pursuant to any other Applicable Law; any system modifications will not render the electronically signed documents non-compliant with ESIGN, UETA or any other Applicable Law; and (iii) that any and all documents bearing an Electronic Signature are: (1) fully enforceable and legally binding in accordance with their terms against the Mortgagor or other party identified thereon; (2) fully transferable or assignable by the Bank to any third party without the need for any additional documentation; (3) fully enforceable by 13

14 such third party to whom the Bank transfers or assigns such document or record; (4) duly and properly executed and attested (if applicable or required) in full compliance with any and all Applicable Laws and regulations, including, but not limited to, any applicable Agency and/or private investor requirements, and shall satisfy all industry-accepted standards for electronically signed documents; and (5) acceptable by the Bank, any Agency or a private investor, as applicable, in accordance with the requirements of the Bank, such Agency or investor. 2.2.lll Servicemembers Civil Relief Act. The Mortgagor has not notified Seller, and Seller has no knowledge of any relief requested or allowed to the Mortgagor under the Servicemembers Civil Relief Act or other similar state statute. 2.2.mmm TILA Qualified Mortgage. Unless the Mortgage Loan is identified on the Mortgage Loan Schedule as Non-QM, or Not Covered, such Mortgage Loan (i) is a qualified mortgage within the meaning of Section (e)(2) of 12 C.F.R. Part 1026 ( Regulation Z ) without reference to Section (e)(4), (5), (6) or (f) of Regulation Z, (ii) complies with the total points and fees limitations for a qualified mortgage set forth in Section (e)(3) of Regulation Z (including the inflation adjustments provided for in Section (e)(3)(ii) of Regulation Z), (iii) is not a higherpriced covered transaction within the meaning of Section (b)(4) of Regulation Z, (iv) only includes a prepayment charge permitted by Section (g) of Regulation Z, (v) does not provide for a balloon payment and (vi) qualifies for the safe harbor set forth in Section (e)(1)(i) of Regulation Z. 2.2.nnn Ability to Repay. For any Mortgage Loan where an application for the Mortgage Loan was taken on or after January 10, 2014, unless the Mortgage Loan Schedule indicates that such Mortgage Loan is Not Covered, such Mortgage Loan complied with the ability to repay standards as set forth in Section 129C(a) of the federal Truth-in-Lending Act, 15 U.S.C. 1639c(a), and Section (c) of Regulation Z and evidence demonstrating such compliance is included in the related Mortgage File. 2.2.ooo Mortgage Loan Qualifies for REMIC. Each Mortgage Loan constitutes a qualified mortgage under Section 860G(a)(3)(A) of the Code and Treasury Regulations Section 1.860G- 2(a)(l). 2.2.ppp No Options. No other party has any option or right of first refusal or other arrangement to acquire directly or indirectly any of the Mortgage Loans offered to the Bank for purchase. 2.2.qqq Prohibited Practices. Seller and its Third Party Originators have not: (i) encouraged a Mortgagor to default on a then-existing loan in connection with the refinance of all or part of such existing loan; (ii) made a payment to a home improvement contractor from the proceeds of the Mortgage Loan other than by a check made payable either to the Mortgagor, or jointly to the Mortgagor and the home improvement contractor, or through an independent third party escrow agent; (iii) made a payment of Mortgage Loan payments in advance from the loan proceeds; or (iv) contracted for an increase in the interest rate upon default of the Mortgage Loan at a level not commensurate with risk mitigation. 2.2.rrr Mortgage Loan Originator Compensation. Neither Seller nor any other party has paid compensation to any loan originator in an amount that is based on a term of the Mortgage 14

15 Loan, and if Seller acts as a loan originator, Seller has not received compensation in an amount that is based on a term of the Mortgage Loan. Compensation policies and practices of Seller and Seller s Third Party Originators do not allow loan originator compensation to vary based on a loan type or product type. 2.2.sss Mortgage Credit Certificate. For each Mortgage Loan involving a Mortgage Credit Certificate, Seller is in compliance with all requirements of the Mortgage Credit Certificate s issuing authority including all required reporting to the Internal Revenue Service. 2.2.ttt Private Transfer Fees. No Mortgage Loan is secured by property that is encumbered by or subject to a private transfer fee or private transfer fee covenant, as those terms are defined by and prohibited by 12 C.F.R. Part 1228, as amended. 2.2.uuu Integrity of Data. The information set forth in the Loan Submission Form and the information contained on each electronic data file delivered by Seller to the Bank is true, correct and complete, and such Loan Submission Form contains at least all of the fields indicated in the definition of Loan Submission Form. The information on the Loan Submission Form and any other information provided by Seller are consistent with the contents of Seller s records, the Mortgage Loan File and the servicing file. Any seller or builder concession in excess of allowable limits (or otherwise ineligible) by the Agencies applicable at the time of origination has been subtracted from the Appraised Value of the Mortgaged Property for purposes of determining the Loan to Value Ratio ( LTV ) and Combined Loan to Value Ratio ( CLTV ) at origination. The Loan Submission Form contains the most current information possessed by Seller. 2.2.vvv Mortgage Loan File. With respect to each Mortgage Loan, Seller is in possession of a complete Mortgage Loan File except for the documents which have been delivered to the Bank or the Custodian or which have been submitted for recording and not yet returned. The Mortgage Note, the Mortgage, the Assignment of Mortgage and the other Mortgage Loan Documents required to be delivered on or before the related Purchase Date have been delivered in compliance with the specific requirements of the Agreement. Each of the documents and instruments specified to be included therein in the Mortgage Loan File is duly executed and in due and proper form, and each such document or instrument is in form acceptable to the applicable federal or state regulatory agency at the time of origination of the Mortgage Loan. For each Mortgage Loan, all documents necessary to foreclose on the related Mortgaged Property are included in the related Mortgage Loan File delivered to the Bank or the Custodian. 2.2.www Ground Leases. No Mortgaged Property is subject to any ground lease. 2.2.xxx No Additional Fees. With respect to any broker fees collected and paid on the Mortgage Loan in respect to the origination, all broker fees have been properly assessed to the Mortgagor, fully paid and no claims will arise as to broker fees that are double charged and for which the Mortgagor would be entitled to reimbursement. 2.2.yyy Flood Certification Contract. The Mortgage Loan is covered by a paid in full, life of loan, flood certification contract, in each case acceptable to the Bank, and each of these contracts is fully assignable to the Bank and its assigns. 15

16 2.2.zzz Program Guides. The Mortgage Loan was underwritten in accordance with the Program Guides in effect at the time of origination of such Mortgage Loan without regard to any underwriter discretion, unless an exception was granted in writing by the Bank. 2.2.aaaa Underwriting Methodology. The methodology used in underwriting the extension of credit for the Mortgage Loan did not rely solely on the extent of the Mortgagor s equity in the Mortgaged Property as the principal determining factor in approving such extension of credit. The methodology employed objective criteria and mathematical principles including, but not limited to, the Mortgagor s income, assets and liabilities, relative to the proposed mortgage payment, and, based on such methodology, the Mortgage Loan s originator made a determination that at the time of origination the Mortgagor had the ability to make timely payments on the Mortgage Loan. For Mortgage Loans sold hereunder underwritten by the Bank before purchase, where the Bank affirmatively agrees that the Bank is responsible for underwriting the Mortgage Loan, Seller is relieved of this representation concerning the underwriting. However, Seller shall still be responsible to insure that all conditions called for in the underwriting approved by the Bank are satisfied by Seller and that all information submitted in the loan application is true and correct in all material respects. In cases where the AUS has recommended REFER or DENY to Seller and Seller chooses to approve and close the loan, the Seller shall assume the duties and obligations regarding the underwriting decision. 16