Anthem Suite of Services

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1 Anthem Suite of Services ASSISTING NON-TRADITIONAL HOMEBUYERS IN EMERGING MARKETS Over the next decade, a projected 60% of first-time home purchases in the United States will be made by those who fall into traditionally underserved markets. Many of these consumers have little or no traditional credit, but are credit worthy. Now with Anthem, First American CREDCO s suite of alternative credit services, you can originate loans using alternative credit data and help more homebuyers fulfill the American dream. Anthem Suite Reduce your risk with efficient and reliable tools that exceed secondary market standards. Expand your business opportunities and satisfy needs of underserved markets. Alleviate labor-intensive process of gathering and validating non-traditional credit information. Accepted wherever non-traditional loan programs are honored. Proactively returns credit data when an ITIN is used in lieu of a Social Security Number. Build Your Business The Anthem Suite is an enhanced set of credit-building tools designed to broaden your business opportunities, reduce the risk of mortgage fraud, and help more Americans become homeowners. And because Anthem is universally accepted wherever non-traditional loan programs are honored, you can close more non-traditional loans more conveniently than ever. OBJECTIVE Determine traditional credit-worthiness of applicants Fast, bureau-level updates of incorrect credit report information Non-traditional credit reporting Non-traditional credit scoring Notification of applicants who do not have adequate traditional credit Segment customers with an ITIN FACT Act Compliance Customizable analysis of non-traditional applicants and loans Applicant assistance understanding their credit reports Applicant resources for disputing credit report errors SOLUTION Instant Merge Rapid ReCheck Anthem Report Anthem Score Advisory for Anthem ITIN Notification Anthem CSD Anthem Performance Consumer Assistance Consumer Disputes For more information on our Anthem Suite of Services, contact a First American CREDCO sales associate at (800) or visit us online at

2 EMERGING MARKETS Expanding Markets Streamlining Business The Anthem Suite of Services The Anthem Suite of Services from First American CREDCO is the only widely accepted alternative credit source that fits easily into your existing loan processes. How It Works: Pull a traditional 3-bureau credit report, just as you do now. If the report comes back as a thin or no file, you have a potential Anthem Report client. For lenders using our Instant Merge product, an automatic notification can be generated stating that an Anthem Report is needed. Log on to ecredco to easily order an Anthem Report. Our FCRA-certified specialists will research and collect non-traditional credit data, such as rent and utility payments. An Anthem Report and Score are generated and returned to the lender. Close the loan and fulfill someone s American Dream! Anthem Helps Lenders: Expands business by tapping into underserved markets. Reduces the risk of fraud. Streamlines processes and reduces costs. Anthem Helps Consumers Without Traditional Credit: Anthem can be used for any loan program that accepts alternative credit data. Builds a credit profile. Allows for better interest rates and lower fees. Helps qualify for loans and fulfill the dream of homeownership. For more information on our Anthem Suite of Services, contact a First American CREDCO sales associate at (800) or visit us online at First American Way Poway, California Phone:

3 EMERGING MARKETS Partners in the American Dream First American Way Poway, California Phone:

4 EMERGING MARKETS Empowering Consumers The Anthem Suite of Services Thanks to First American CREDCO s Anthem Suite of Services, more Americans are enjoying the rights and privileges of homeownership. Anthem provides the credit tools lenders need to help traditionally underserved homebuyers qualify for home loans. This means that consumers with little or no credit history can qualify for loan programs with better interest rates and lower fees, adding up to a significant cost savings! Anthem can be used for any loan program that accepts non-traditional credit data. $300,000 mortgage loan with 30 year fixed interest terms Customer with a high Anthem Score APR Monthly Payment Total Cost 6.00% $1, $647,514 Customer with no Anthem Score APR Monthly Payment Total Cost 9.00% $2, $868,992 Total Savings: $221,478 For more information on our Anthem Suite of Services, contact a First American CREDCO sales associate at (800) or visit us online at First American Way Poway, California Phone:

5 EMERGING MARKETS Anthem Suite FAQs Frequently Asked Questions What Is The Anthem Suite? The Anthem Suite is a comprehensive offering of alternative credit services that allows lenders to qualify consumers without traditional credit information. By using supplemental information from alternative sources, such as rent payments, a lender can form an accurate risk assessment on first-time home buyers, recent immigrants, unbanked consumers, international applicants, and other consumers. What Data Is Used In The Anthem Suite? The Anthem process starts with credit data gathered from an Instant Merge credit report. The information is then supplemented with alternative forms of credit data, such as rent, utility and insurance payments. Research shows that alternative payment histories, such as rent payments, are the most predictive form of data, and can accurately demonstrate a consumer s likelihood of making future mortgage payments. All non-traditional credit data used to generate an Anthem Report and Score are verified by First American CREDCO s dedicated team of FCRA-certified credit specialists. What Is The Anthem Score? The Anthem Score was developed to fit seamlessly into existing mortgage, underwriter and investor guidelines. It is calibrated to produce scores that are similar in range and distribution to traditional credit scores. Used to improve underwriting of loans, any loan accepting non-traditional credit can be streamlined and normalized by implementing the Anthem Score. Score range is 325 to 850. Fully compliant with ECOA, GSE and regulatory requirements including the ability to make disclosures and disputes. Who Accepts Anthem? Any loan program allowing nontraditional credit data can use the Anthem Suite. The Anthem Report and Score were designed with data and underwriting rules already in use with GSEs and major lenders across the country. Lenders with an investor agreement approving non-traditional data as well as those desiring to normalize, streamline and reduce risk in loan programs using non-traditional data can incorporate the Anthem Report and Score into their process. Includes explanatory Factor Codes First American Way Poway, California Phone:

6 EMERGING MARKETS Anthem Suite FAQs Frequently Asked Questions How Is Anthem Implemented? The Anthem Suite can be delivered to you in a variety of methods. First American CREDCO customers can receive Anthem through their existing connectivity or online through ecredco, or Anthem can be integrated into an existing LOS. How Is Anthem Ordered? Ordering Anthem is simple: Pull an Instant Merge Report If the file comes back as thin or no file, upgrade your report to an Anthem Report FCRA-certified specialists will do the research and return a report and score to you in a timely manner To further simplify the process, you can also order Anthem Advisory, which automatically notifies you when thin and no file criteria are met on an Instant Merge Report. How does Anthem help consumers? A Score for Every Applicant The Anthem Suite allows lenders to obtain a credit report and an underwriting score on any applicant. Since Anthem s inception in 2004, we have been able to get credit information on every applicant who needed an Anthem Report. Does Anthem Offer Compliance And Fraud Features? Yes. The Anthem Suite is fully compliant with all aspects of the FACT Act, Credit Score Disclosures, and Consumer Disputes. All data is fully verified by FCRA-certified specialists to meet lender requirements, which helps detect and eliminate fraud. Fraud alerts, identity verification, income and employment verification are all available through the Anthem Suite of Services. For more information on the Anthem Suite of Services, contact a First American CREDCO sales associate at (800) or visit us online at Bi-Lingual Support First American CREDCO s bilingual team of Spanish and English speaking FCRA-certified credit specialists are available to assist you and your applicant to re-evaluate credit data, update as necessary, and re-issue the score. This Customer and Disputes Resolution Service is offered FREE to every consumer whose credit report is provided by First American CREDCO First American Way Poway, California Phone:

7 EMERGING MARKETS Instant Merge The First Step in Alternative Credit Reporting Instant Merge, part of First American CREDCO s Anthem Suite of alternative credit services, is the most popular merged credit report across all industries. It s an ideal fit for most lending situations, combining credit data from one, two or all three national credit bureaus into a single report in a common format. It s also the first step in helping lenders help underserved consumers achieve the dream of homeownership. Instant Merge: The First Step When assisting consumers with potentially little or no credit history, Instant Merge is the first in a series of short steps to initiate the loan qualification process: Start with a traditional credit check Instant Merge. If incorrect tradeline data is present, our Rapid Recheck service is available for fast bureau level updates. If insufficient credit data thin or no file then request an Anthem Report. Underwrite a loan that meets or exceeds lender and investor requirements. Convenient. Flexible. FAST. Instant Merge is delivered in seconds using a variety of methods, including the Internet, our desktop software, your Loan Origination System or other customizable connectivity solutions. For more information on Instant Merge, contact a First American CREDCO sales associate at (800) or visit us online at PRODUCT Highlights Qualify more buyers, expand your business Delivers your data in raw or machine readable formats Details demographic information, current and historical tradeline details, and public records and inquiries Make fast, bureau-level updates of incorrect tradeline data with Rapid ReCheck Anthem Advisory delivers an automatic notification whenever an Anthem Report is needed All bureau data from an Instant Merge is included in the Anthem Report FICO scores, bankruptcy, credit and risk scores, and identity verification products also available Available in a Spanish-language format First American Way Poway, California Phone:

8 EMERGING MARKETS Anthem Report Collect, Assess and Verify Non-traditional Credit Information As part of First American CREDCO s Anthem Suite of Services, the Anthem Report offers the most cost-effective mortgage credit reporting solution for consumers with little or no credit history. This powerful reporting tool delivers accurate, verified non-traditional credit data along with a unique score in an easy-to-use format that allows lenders to qualify and write more loans. The Anthem Report is accepted wherever alternative credit data is honored. Capture a broader credit history When you order an Instant Merge credit report on a borrower who has a thin or no credit file, the Anthem Report first utilizes any available bureau data as a baseline. It then supplements any bureau data with non-traditional credit data, such as rent payments, utility bills and phone bills. The result is a fully compliant credit reporting solution that meets or exceeds mortgage loan underwriting and due diligence requirements, including HUD, FHA, Fannie Mae and Freddie Mac. Serve a broader market Anthem helps you build business for new homebuyers in a simple and compliant way, while meeting or exceeding lender loan requirements. FCRA-certified specialists research and verify all Anthem Reports, and work closely with you to ensure your level of understanding of the credit data so you can make sound lending decisions. Rely on industry experts Outsourcing your non-traditional credit needs with First American CREDCO means your staff doesn t have to become experts in collecting and verifying non-traditional credit data. Instead, you can rely on knowledgeable, trusted processors for reliable credit information, which frees you up to focus on expanding your market and growing your business. For more information on the Anthem Report, contact a First American CREDCO sales associate at (800) or visit us online at PRODUCT Highlights Qualify and write more loans on consumers with little or no credit history Accepted wherever alternative credit data is honored Delivers a 100% hit rate for thin or no file applicants Completed in hours. Make lending decisions faster and more consistently across all consumer files Minimize training, cost and time of internal resources, freeing you for greater productivity Protects originator and investor from fraudulent credit claims Provides underwriting score for no score files, and risk support for thin files Anthem Credit Score Disclosure (CSD) is included free of charge with every report ordered to comply with Section 212 of the FACT Act First American Way Poway, California Phone:

9 EMERGING MARKETS Anthem Score Industry s First Non-Traditional Credit Score As part of First American CREDCO s Anthem Suite of Services, Anthem Score is the industry s first score based on the same fully verified credit data that comprises our Anthem Report. The Anthem Score, which ranges from 325 to 850, represents a comprehensive and reliable underwriting score for consumers who have little or no credit history, or have previously been considered un-scoreable. And because Anthem is universally accepted whenever non-traditional data is indicated, you can close more non-traditional loans more conveniently than ever. A Reliable, Predictive Score Unlike other non-traditional scoring models, the Anthem Score is generated from the Anthem Report, thereby exceeding lender and investor standards for thin and no file underwriting. Anthem Score considers the type of credit, the length of credit, the payment history, and the verification methods used. All of this comes together to produce a predictive underwriting score for loan origination. Make Lending Decisions with Confidence First American CREDCO utilizes the industry s strictest standards to verify credit sources and applicant identity. This commitment to accuracy, consistency and reliability allows you to make lending decisions more confidently in a growing market of traditionally underserved homebuyers. For more information on the Anthem Score, contact a First American CREDCO sales associate at (800) or visit us online at PRODUCT Highlights Delivers an easy-to-use risk assessment score ranging from 325 to 850 Delivers a 100% hit rate for thin or no file applicants Exceeds lender and investor standards FREE with every First American CREDCO Anthem Report Expands market penetration in traditionally underserved sectors Helps protect originators and investors from fraud in higher risk markets Streamlines operations by reducing the time required to close loans Anthem Credit Score Disclosure (CSD) is included free of charge with every report ordered to comply with Section 212 of the FACT Act First American Way Poway, California Phone:

10 Anthem Report Sample Non-Traditional Credit Report with Anthem Score TID: Transaction Identification Uniquely identifies every interaction the customer has with the First American CREDCO system Anthem Report Ref #: PFM Acct #: TID: PFM Prepared for: BA Test Account Factors & Descriptions Highlights the Tiers of data used and the level of verification obtained for Rent. Received: Completed: Revised: Attention/Additional information: 12/10/04 12/10/04 ALICE /LOAN NUMBER 123 Sources - Lists where the Charges: Credit and public record sources: data came from NOT AVAILABLE CRD, EFX, XPN, TUC, MAN for this report Applicant CREDCO, MICHAEL A Soc. Sec. No Co-applicant Soc. Sec. No. Address 2514 ARTILLERY ST Marital status MONTEREY, CA Dependents Anthem Score - Length First American s Non-Traditional Credit Score is determined with all Applicant Co-applicant available bureau data and any verified non-traditional data. Employer Employer Considers information such as Position Position payment history, types and length Length Length of credit. Income Income Verified Verified FAC Anthem Score (APP)= 743 Factor: 00001, ALL NT DATA IS FROM TIER I RENTAL PAYMENT VERIFIED WITH COPIES OF CANCELLED CHECKS OR BANK RECORDS Account Name/Number (Sources) Past due Last Open High Payment Balance MOP Status Rptd MR Dlq Updated information on items below will follow on a supplemental report: COLLECTECH/ (EFX-180YC04534*,TUC*) I Y-9 COLL/P&L Hist: CLSD APP Ctgy: COLLECTION Term: REV LACT CN: BELL ATLANTI CREDITOR RATES BY MAIL ONLY Verification and Fraud Checks - All trade lines are subject to First American s strict verification policies to validate the data and check for fraud. Bureau data - Any existing bureau data is incorporated into the report and the Anthem Score. Non- Traditional data Data not available from the bureaus, such as Tier II and III data including insurance and other regular payments. History Section - Indicates month-to-month payment history pattern. Accounts under Applicant: GEICO AUTO INS. /ABC (MAN) I W-1 CURRENT Hist: APP Term: REV 3. GAS AND ELECTRIC / (MAN) I V-1 CURRENT Hist: APP Term: REV 4. HOLLY GOLIGHTLY/PREVIOUS LANDLORDXXXX (MAN) I CLOSED L-1 CURRENT Hist: CLSD APP Term: REV Fraud Verification Information: TUC High Risk Fraud Alert (APP) AVAILABLE AND CLEAR. Prepared By: First American CREDCO First American Way POWAY, CA ****** END OF REPORT ****** Bureau Fraud Checks - Fraud alerts appear if any credit bureau records exist on an applicant. When a fraud message does appear it will show whom the message pertains to: APP, CAP or PNA. Utilities Information - Indicates Tier I data such as gas, electric and other utility payment history data. Rental Information - Rental history is always sought as part of the Anthem Report. This sample report was created to showcase a wide variety of format features. As such, the data content represented here may not be consistent across all report sections. Anthem F1 format sample (rev. 4-07)

11 EXPERT CUSTOMER CARE Consumer Assistance and Disputes Resolution At First American CREDCO, our number one goal is to help consumers establish or gain control over their financial health so that they re afforded opportunities to achieve the dream of homeownership. To help make this possible, we offer free Consumer Assistance and Disputes Resolution services to all clients of First American CREDCO customers. Provides one-call dispute resolution Helps consumers understand their credit scores and interpret their credit report Provides education on the importance of establishing and maintaining good credit, and monitoring credit profiles Teaches how to build a non-traditional credit history Protects against identity theft and common scams Bi-lingual support fluent Spanish-speaking Customer Care Specialists available OUR COMMITMENT TO YOU, AND YOUR CLIENTS Every American deserves the opportunity to achieve the dream of homeownership. At First American CREDCO, we create those opportunities for everyone. That s why we offer educational tools and resources dedicated to providing homeownership opportunities for traditionally underserved consumers. Consumer Assistance and Disputes Resolution services are available to all consumers who access their credit report from First American CREDCO or to any loan applicant working with a First American CREDCO mortgage professional. Consumer Services Consumer Assistance and Disputes Resolution First American Way Poway, California Phone:

12 CONSUMER SERVICES Consumer Services Consumer Assistance Understanding credit and how it affects consumer choices is critical, particularly when it comes to home buying. That s why we have a team of credit professionals dedicated to helping consumers take control of their credit and improve their overall credit health. Our Consumer Assistance Services is available to all First American CREDCO customers to help them better understand what is in their credit reports and how it impacts them. We can even make recommendations to assist them with strategies for establishing and improving their credit history. Consumer Disputes Resolution When you order credit information from First American CREDCO, your clients get free access to our convenient, toll-free consumer disputes service. With just one call, our FCRA-certified specialists will work hand-in-hand with your clients to resolve any discrepancies with the national credit bureaus. As a single contact point, our Consumer Disputes Resolution service makes the often complicated and time-consuming credit dispute process easier for your clients, and you. One-call Dispute Resolution DISPUTE INVESTIGATIONS We investigate tradelines by working directly with the credit bureaus. CONSUMER INTERACTION We actively communicate the results of our investigative process to the consumer. BUREAU COMMUNICATION Our Consumer Disputes team works with the bureaus on the consumer s behalf to update incorrect data. FCRA COMPLIANCE First American CREDCO strictly adheres to the guidelines set by the FCRA regarding timeframes, forms and procedures. With proper guidance and education, consumers can feel empowered to move ahead in their dream to achieve homeownership. Home Buyers Credit Education First American CREDCO offers a free online educational site dedicated to helping consumers understand and build the credit they deserve. Online Resources CREDCO.com/CreditEducation: What is credit? Home buying guide Credit challenges Credit issues to consider Checking your credit Questions Contact First American CREDCO today! Call: [email protected] Visit: First American Way Poway, California Phone:

13 EMERGING MARKETS Anthem Performance Alternative Credit Portfolio Analysis and Evaluation Anthem Performance, part of the Anthem Suite of Services from First American CREDCO, empowers mortgage professionals with the information and insight they need to make sound business decisions. Powerful Business Insight Anthem Performance collects the non-traditional credit data gathered from the Anthem Reports you order and builds a database for your business. The database provides access to key intelligence and analysis capabilities so you can minimize risk and maximize business opportunities. We use proven data mining and statistical methods to identify and provide insight into Anthem mortgage loan applicant data such as consumer behavior, demographics and market trends that you can use to improve your applicant underwriting and risk management. Portfolio Risk Assessment Validate portfolio value Mitigate risk Identify opportunities Retain customers Consultative Analysis Our personalized, consultative approach helps you understand critical performance findings and, more importantly, what they mean so you can be proactive in managing your Anthem loan portfolios. PRODUCT Highlights Customized portfolio solutions for Anthem loan applicants Monitor loan portfolios for trends and potential fraud-related risk Gain valuable insight into loan portfolio value and performance Personalized, consultative analysis Identify business opportunities; maximize loan portfolio performance For more information on Anthem Performance, contact a First American CREDCO sales associate at (800) or visit us online at First American Way Poway, California Phone:

14 FIRST AMERICAN CREDCO: DOING OUR PART How First American s Consumer Services Helped One Family Realize Their Dream to Own a Home I have bad news, said Tracy as she hung up the phone and turned to face her husband. Our broker just called to say that the lender he deals with can t approve our home loan at the current market rate. When Tracy and Ketut Sutama set out to buy their first house, they had no idea what challenges and frustrations lay ahead. It hadn t taken them long to find the perfect place exactly what they d had in mind for their first home. But two weeks into an uneventful escrow, Tracy got the call from their broker. If what he says is true, they re going to bump us up to 8.7 percent, Tracy explained, sounding tired. With the financial stress of a young child and a husband who had just recently emigrated from Indonesia, Tracy wondered how they could afford the thousands of dollars the higher interest rate would cost them. She realized she had to do something. Tracy immediately set up a meeting with her broker to discuss ways she might be able to raise her credit score. After reviewing her credit report, Tracy found several items that seemed outof-date items that might be negatively affecting her credit score. But with her loan cheduled to close in just a few weeks, Tracy had no idea how she could correct the problems on her credit report in time. That's when the broker remembered Rapid ReCheck, a service from First American that his lender had recently recommended. The broker realized that Rapid ReCheck might be the key to quickly correcting the inaccuracies on Tracy s credit report and hopefully boosting her score. I met Gigi, one of First American s certified representatives, when my broker ordered the Rapid ReCheck. I can honestly say that working with her was the most positive experience in the home buying process. Gigi was able to tell me exactly what I needed to do in order to try and raise my score. She walked me through the process step-by-step. Tracy received one-on-one support over a three-week period. She and Gigi were in constant contact. Gigi helped Tracy figure out which creditors she needed to contact for documentation and how best to approach them. I finally felt like I had an ally like someone finally cared. Gigi helped give me some control over the whole situation. From the documentation I gathered, Gigi worked directly with the national credit bureaus on my behalf to update items on my file. Just before closing, Tracy s credit report was re-pulled. Nobody could believe the result. Through First American s support and consumer dispute assistance, Tracy s credit score had soared an unheard of 55 points a full 20 points more than she needed to qualify for a lower interest rate. First American CREDCO, First American Way, Poway, CA

15 We love our new home, said Tracy with audible happiness in her voice. I wish there was a better way we could show Gigi our appreciation, but mortgage payments can be a shock, she laughed. For Gigi, it s enough to know that she was able to help. And, for First American, it s just a part of what we do. More about Rapid ReCheck First American s Rapid ReCheck is a service that aids lenders and brokers that have pulled a credit report from First American by updating inaccurate or incomplete data on the consumer s files with the national credit bureaus. Once these items have been brought up to date, the consumer s report is re-pulled. Because a consumer s credit score is generated using the credit information contained in their bureau files, the new report often yields an improved score. More about Consumer Services First American s Consumer Assistance program aids consumers in understanding their credit profiles and can provide strategies for improving their overall credit health. FCRA-certified specialists are available to work hand-in-hand with the consumer to resolve discrepancies on their files with the national credit bureaus. These services are available to any loan applicant working with a lender who utilizes First American s credit reporting services. By providing both general Consumer Assistance and Consumer Dispute Resolution, First American helps empower individuals to take control of their credit profiles. More about First American CREDCO First American CREDCO, a member of First American s Credit Information Group, processes millions of credit reports annually across a diverse customer base. The company was the first to provide merged credit data to the mortgage lending industry, and is the leading provider to Fannie Mae and Freddie Mac. Today, First American CREDCO provides one of every three reports used by mortgage professionals. Credit-granting organizations of all types and every size rely on products from First American CREDCO for credit decisions involving billions of dollars annually. More information about the company can be found at Neither First American CREDCO nor Rapid ReCheck or Consumer Services are credit repair agencies or provide credit repair services. Rapid ReCheck is provided to, and paid for by, the lender or broker who has ordered a credit report from First American CREDCO in connection with a specific loan transaction. Where the credit report that First American CREDCO has provided contains inaccuracies or outdated information, Rapid ReCheck expedites the process of correcting the information in the credit files of the national credit bureaus so that an accurate, up-to-date report is available for the transaction. Consumer Services are provided to the subject of credit reports issued by First American CREDCO in connection with the consumer dispute resolution process under the Fair Credit Reporting Act. No representation is made that the experience of the consumer in this testimonial is typical, or that significant improvements to a consumer s credit files will be made in every case. Rather, individual results will vary depending on the particular facts and circumstances involved.

16 Contacts: David Woodruff First American CREDCO (619) FIRST AMERICAN S ANTHEM LENDER DIRECTORY OFFERS A CLEAR PATH TO BROKERS AND LENDERS NOW USING ALTERNATIVE CREDIT SOLUTIONS Company Also Announces Key Enhancements to its Alternative Credit Product Suite LAS VEGAS, Nov. 3, 2006 The First American Corporation (NYSE: FAF), America s largest provider of business information, today announced the availability of the Anthem Lender Directory, a growing index of screened and certified mortgage lenders who have incorporated nontraditional credit scoring solutions into their underwriting processes. More than 200 loan officers from across the nation are currently listed in the growing directory, which assists real estate agents, community-based organizations, home counseling service providers and consumers in identifying lenders who are using the latest credit evaluation techniques to deliver the best possible loans at the best possible prices. Introduced at the National Association of Hispanic Real Estate Professionals (NAHREP) convention in Las Vegas this week, the Anthem Lender Directory is expected to be of great value within the homebuying segments where a more comprehensive approach to credit is necessary to better evaluate borrowers without established files at the major credit bureaus. First American s credit information subsidiary, First American CREDCO the largest provider of credit information to the mortgage industry estimates that 20 percent of Americans are unscorable using traditional credit bureau data alone, but that many can qualify for primegrade loans when alternative payment history is brought into the evaluation process. By helping consumers efficiently identify trusted lenders who are now embracing alternative credit solutions, First American is continuing to serve as a catalyst in creating homebuying opportunities within the emerging minority and new immigrant homebuyer segments, said Mark F. Catone, senior vice president for First American CREDCO. Connecting those homebuyers with committed lenders who have undergone our rigorous compliance screening process will enable many more deserving families to secure prime-grade mortgage loans. 1

17 On a $300,000, 30-year loan, a family that qualifies for a 6 percent rate will pay $600 less per month and $220,000 less over the life of that loan than a family with a 9 percent interest rate, said Landon V. Taylor, vice president of Market Development at First American. Often the only barrier keeping that family from the lower rate is a credit score derived from data that does not fully reflect the borrower s willingness and ability to repay the loan. Lenders who use alternative credit solutions are helping lift this barrier and leveling the playing field for prospective homebuyers with nontraditional banking, credit and spending patterns. In addition to the new Anthem Lender Directory, First American has also announced several enhancements to its Anthem product suite, a tested and reliable alternative credit solution that helps mortgage applicants with little or no traditional credit history qualify for primegrade financing. Anthem augments traditional credit bureau data with rent, utilities, insurance and other types of payment histories to produce a more comprehensive view of a borrower s payment behavior. New enhancements include: Spanish language credit reporting and disclosures; International credit data reporting; Automated thin-file and no-file notification; Automated Individual Tax Identification Number (ITIN) identification; and Integration with EagleCert, an insured valuation product from First American that offers time and cost savings over a traditional appraisal while not exposing the lender to any greater risk. Anthem is the only fully compliant mortgage credit reporting solution that meets mortgage loan underwriting and due diligence requirements of the U.S. Department of Housing and Urban Development (HUD), the Federal Housing Administration (FHA), Fannie Mae and Freddie Mac. NAHREP Chairman Frances Martinez Myers noted that the current mortgage industry practice of lowering credit standards and raising allowable debt-to-income ratios is a disservice to borrowers and to businesses over time, and that broadening the current credit spectrum to be more inclusive of culturally influenced Hispanic borrower traits is a healthier, short- and long-term approach. The enhanced Anthem product suite provides lenders with the tools necessary to efficiently and profitably make loans based on alternative credit criteria. 2

18 We are taking the next step in closing the homeownership gap by building upon our success with Anthem, said Taylor. By meeting the specific compliance and underwriting needs of mortgage lenders and investors, we are seeing increased adoption of Anthem. Last week, First American announced a new partnership with Neighborhood Housing Services of America (NHSA) that is using Anthem to help qualify thin-credit/no-credit borrowers for prime-grade mortgages. Employing the broader credit information available via Anthem, the program successfully delivered its first prime-grade loan to a homebuyer in October. For more information on the Anthem product suite, please visit: Lenders and brokers interested in registering with First American s Specialty Lender Directory should visit or call (800) About First American The First American Corporation (NYSE: FAF), a FORTUNE 500 company that traces its history to 1889, is America s largest provider of business information. First American combines advanced analytics with its vast data resources to supply businesses and consumers with valuable information products to support the major economic events of people s lives, such as getting a job, renting an apartment, buying a car or house, securing a mortgage and opening or buying a business. The First American Family of Companies, many of which command leading market share positions in their respective industries, operate within five primary business segments, including: Title Insurance and Services, Specialty Insurance, Mortgage Information, Property Information, and Risk Mitigation and Business Solutions. With revenues of $8.1 billion in 2005, First American has approximately 2,100 offices throughout the United States and abroad. More information about the company and an archive of its press releases can be found at 3

19 Contacts: David Schulz Corporate Communications The First American Corporation (714) STATE FARM INVESTS $100 MILLION IN NHSA S NEW PRIME-GRADE MORTGAGE PROGRAM CHICAGO, Oct. 24, 2006 Neighborhood Housing Services of America (NHSA) and State Farm today announced the creation of a $100 million loan pool that will help thousands of homebuyers secure mortgage loans at competitive rates. Designed to help under-served home seekers often within the minority and new immigrant communities the NHSA loan program will employ The First American Corporation s (NYSE: FAF) Anthem Report and Anthem Score, two tested and reliable alternative credit solutions that help lenders assess a consumer s creditworthiness using data beyond what is found in traditional credit bureau reports. Combining this new method of credit analysis with extensive prepurchase and post-close homebuyer counseling services from nonprofit home counseling agencies will enable NHSA and its mortgage lenders to confidently extend prime-grade mortgage loans backed by the State Farm-funded loan pool to consumers with little or no traditional credit history. Before now, there hasn t been an effective, efficient means of moving nonprime borrowers into prime loans, said Mary Lee Widener, president and chief executive officer of NHSA. Speaking at the annual Mortgage Bankers Association Convention & Expo in Chicago, Widener emphasized industry collaboration, affordability and borrower support as key factors in assisting those traditionally locked out of prime-grade mortgage financing, and in creating new market opportunities for lenders. By demonstrating that these consumers are not higher risk, and by providing lenders with a secondary market to sell the loans post-close, our Prime-Grade Mortgage Program directly addresses the challenge faced by an estimated 50 million U.S. consumers currently locked out of appropriate mortgage financing by traditional mortgage lending standards, said Widener. We have already begun to make a positive impact through the tremendous support of State Farm, First American and our counseling service partners, and we hope to further expand this program through additional partnerships in the years to come. Earlier this month, the Prime-Grade Mortgage Program had its first success in helping a homeowner in Cincinnati qualify for prime-grade financing. In that instance, the homebuyer denied appropriate financing using traditional channels found help in a local NeighborWorks counseling center, The Homeownership Center of Greater Cincinnati, which connected her to the Prime-Grade Mortgage Program. Using the alternative credit data, Fifth- Third Bank funded the loan, which was simultaneously purchased by NHSA using the State Farm loan pool. 1

20 We re excited about the hope this program provides and the impact it will have on people, said Clayton Adams, vice president community development at State Farm. Our partnership and this investment with NHSA and First American matches our philosophy and strategy to support community development by empowering individuals to overcome adversity and eliminate barriers to buying a home for the first time. The rapidly changing market conditions are casting new light on the needs and strong purchasing power of the fast-growing minority and new immigrant homebuyer segments, said Landon V. Taylor, vice president of market development at First American. We re pleased to help deliver innovation that enables the extension of responsible and affordable mortgage financing to all Americans. About Neighborhood Housing Services of America NHSA is part of the NeighborWorks System, which also includes (a) NeighborWorks America, a congressionally chartered public nonprofit corporation that creates opportunities for people to live in affordable homes, improve their lives and strengthen their communities, as well as (b) the more than 240 local nonprofit NeighborWorks organizations that share a mission to revitalize their neighborhoods and communities and to provide affordable housing. NHSA, together with NHSA-CDFI its affiliated community development financial institution and NHSA s e-commerce center, plays a critical role in meeting the capital needs of the NeighborWorks network. Raising private sector capital from socially responsive investors, NHSA purchases first and second mortgages from local NeighborWorks organizations and their lending partners. NHSA also develops innovative loan products and services to increase the capacity of the NeighborWorks network to expand affordable housing opportunities in their communities. For more information, please visit: or About State Farm State Farm insures more cars than any other insurer in North America and is the leading U.S. home insurer. State Farm's 17,000 agents and 68,000 employees serve over 74 million auto, fire, life and health policies in the United States and Canada, and more than 1.8 million bank accounts. State Farm Mutual Automobile Insurance Company is the parent of the State Farm family of companies. State Farm is ranked No.22 on the FORTUNE 500 list of largest companies. For more information, please visit statefarm.com or in Canada statefarm.ca. About First American The First American Corporation (NYSE: FAF), a FORTUNE 500 company that traces its history to 1889, is America s largest provider of business information. First American combines advanced analytics with its vast data resources to supply businesses and consumers with valuable information products to support the major economic events of people s lives, such as getting a job, renting an apartment, buying a car or house, securing a mortgage and opening or buying a business. The First American Family of Companies, many of which command leading market share positions in their respective industries, operate within five primary business segments, including: Title Insurance and Services, Specialty Insurance, Mortgage Information, Property Information, and Risk Mitigation and Business Solutions. With revenues of $8.1 billion in 2005, First American has approximately 2,100 offices throughout the United States and abroad. More information about the company and an archive of its press releases can be found at 2

21 The Washington Post By Kenneth Harney November 10, 2006 Credit Score Alternatives Can Fatten Thin Files Picture this scenario: You've lived in this country for the past 15 years, earned a decent wage, raised a family, always paid your rent, utilities, cell phone bills and other expenses on time, month after month. But you made little or no use of the conventional banking and credit systems - avoiding bank loans, credit cards and debts in general. Now you go to apply for a mortgage to buy your first home and get smacked with this sobering news: Sorry, but there is not enough information in your national credit bureau files to score your credit. We've got to either charge you an interest rate well above prevailing rates - 9 percent or 10 percent in a 6 1/2 percent market - or reject you altogether. That scenario is precisely what large numbers of Latino families now face, according to a new survey. The 14,000-member National Association of Hispanic Real Estate Professionals - Latino and non-latino realty agents, builders, mortgage bankers and lenders, attorneys and credit counselors - polled 500 of its members and found that: Nearly one-third said their clients end up paying "subprime" rates on mortgages because limited credit histories make them appear high-risk when lenders use traditional FICO scores, the dominant credit evaluation method in the mortgage underwriting process. Nearly 80 percent said that for every Latino household they help put into a home of their own, they're forced to turn away two prospects solely because they can't pass muster under traditional score-based computer underwriting programs. The chairperson of the Hispanic realty association, Frances Martinez Myers, estimates that if mortgage lenders used alternative credit scoring models that factored in rent, utilities and other types of payments that are not reported to the national credit bureaus, an additional $200 billion in new home loans could be extended to Latino purchasers. Felix DeHerrera, incoming chair of the association, said that under current underwriting approaches, Latinos often get "penalized for being debt-averse, rather than being rewarded for their consistency in meeting financial commitments, even if it is in cash." But the credit scoring inadequacy problem extends far beyond Latinos. Fair Isaac Corp., developer of the FICO score, estimates that as many as 50 million Americans - of all ethnic backgrounds, ages and incomes - can't be scored or are difficult to score because they have minimal information on file at the three national bureaus. In effect, the credit deck is stacked against them. They often are forced to pay higher fees and interest rates than they deserve. But there is good news for many of these consumers: Growing numbers of lenders and mortgage brokers understand the "thin file" issue and have begun offering at least one of several alternatives to traditional credit scores. At the annual convention of the National Association of Hispanic Real Estate Professionals this month, a new guide was released listing hundreds of brokers and lenders around the country who use the Anthem system of nontraditional credit reports and scores as supplements to FICOs. Anthem, developed by First American CREDCO, the credit data subsidiary of First American Corp. of Santa Ana, Calif., evaluates whatever information on an applicant may exist in the files of the national bureaus - Equifax, Experian and TransUnion. Then, it mixes in information collected by CREDCO from other sources. These include regular child-care payments, telephone, electricity and other utilities payments, current and former rent payments, plus personal credit data from businesses that do not report to the bureaus - small local retailers that extend credit, payday lenders, rent-to-own companies and the like. This produces an alternative credit file that can then be scored. First American CREDCO says their scores accurately predict borrowers' risk of future default. Better yet, alternative scoring allows lenders to cut mortgage rates, down payments and fees for people with solid - albeit nontraditional - credit backgrounds. The goal, according to Mark F. Catone, CREDCO's senior vice president, is to help "deserving families to secure prime-grade mortgage loans," in spite of the fact they score poorly using traditional FICOs. The Anthem system is just one of several alternatives that are now available to help applicants with "thin files." Fair Isaac itself offers an alternative-data counterpart to its traditional FICO score known as the Expansion score. Another company is functioning as a national repository for nontraditional credit data. PRBC.com of Annapolis specializes in helping consumers build their own alternative credit databases by supplying verifiable rent, utilities and other periodic payment information directly to the firm. Bottom line here: Just because there's not a lot on file about you in the big three credit bureaus no longer means that you can't obtain a home mortgage on favorable terms. You just need to ask about - or demand - scoring alternatives from lenders First American Way Poway, CA Tel:

22 Why Top Mortgage Lenders Rely On First American CREDCO Performance. Leadership. Vision. 9 out of 10 top lenders agree: First American CREDCO delivers innovative solutions that keep pace with today s dynamic business climate. Performance has made First American CREDCO a leader in consumer information solutions for more than four decades. Leveraging the latest technology and our vast data resources, we continue to set the industry standard and value benchmark for reliable products, fast delivery and technical innovation. Leadership is why top mortgage lenders trust First American CREDCO. We were the first to provide credit data to the mortgage industry, and today we are the industry s primary source for fast, reliable consumer information products. We provide innovative credit reporting tools, comprehensive identity verification solutions, portfolio analysis and consulting services, as well as non-traditional credit information products that offer new business opportunities. First American CREDCO is the #1 choice of secondary market investors, including Fannie Mae and Freddie Mac. Vision is the foundation for First American CREDCO s expanding line of innovative products and services. Our consumer information solutions have enabled top lenders to make sound business decisions for more than 40 years. Today, we continue to identify new ways, and create new products, to help our customers make smarter business decisions across an ever-changing marketplace. Setting the Pace Top national mortgage lenders depend on First American CREDCO to set the pace for leading products, customized consumer information solutions, quality customer care and reliable technical support. 99.8% proven systems uptime Consumer information delivered in seconds High-volume capacity National field presence and processing centers Dedicated customer care and technical support Only redundant hot backup and disaster recovery site in the industry Customized delivery methods, media and channels Focusing on solutions that support our customers throughout the lending process.