Sierra Pacific Mortgage Geographic Restrictions fileSierra Pacific Mortgage Geographic Restrictions Geographic Restriction Table 2 Rev 04/07/2014 Rev 04/07/2014

Sierra Pacific Mortgage

Geographic Restrictions

Geographic Restriction Table 1 Rev 04/07/2014

Geographic Restrictions Table * State Products Restriction

ALABAMA ALL Coliseum Boulevard Area of Montgomery: This area contains a subsurface chemical condition or environmental condition known as the Coliseum Boulevard Plum (CBP). If the subject property is located in this area, the loan must meet the following requirements: • A full appraisal (interior/exterior) is required. Reduced appraisals not eligible. • A fully executed disclosure issued by the Montgomery Area Association of Realtors (MAAR)

identified as the Coliseum Boulevard Plume Disclosure, must be part of the purchase contract and signed and dated by all required parties prior to closing.

ARKANSAS FHA Streamline

FHA Streamlines for properties located in AK will not be eligible for loans locked on or after 6/29/2012 and funded on or after 7/06/2012. This restriction does NOT apply to FHA WF Streamline product

CALIFORNIA ALL See Exhibit “A” for SPECIFIC restrictions

FLORIDA ALL Conv. (except Sierra Direct)

Miami-Dade County – Attached PUDs: projects must be review for right of first refusal.

04/07/2014 refer to the Specific Product Matrix

Sierra Direct 11/20/2013-refer to the Specific Product Matrix

FHA/VA Condo projects are eligible subject to criteria stated in applicable agency guides.

GEORGIA ALL On all refinances, loan proceeds are required BY LAW, to be deposited into the closing agent’s account no later than 11:00am (EST) the next business day following the expiration of the rescission period. Funds must be wired to the closing agent’s account the last day of the rescission period to ensure we meet the strict timing guidelines. We are not entitled to receive/charge any interest on the loan proceeds until disbursement by the settlement agent has occurred. Due to this, no pre-funding conditions will be allowed other than signed 1003.

HAWAII ALL Big Island of Hawaii: Loans for properties located in lava flow zones #1 and #2 are not eligible. As previously announced: All loans secured by properties located in the state of Hawaii must have been originated on or before 12-31-2010. Loans already in the pipeline may be funded provided they were originated on or before 12-31-2010. FHA case numbers must have been obtained on or before 12-31-2010.

ILLINOIS ALL • Cook County loan transactions with Note dates falling or after July 1, 2008 require a copy of the Certificate of Compliance or Certificate of Exemption recorded with the Deed of Trust.

• All loan transactions must have FULL/ALT documentation regardless of AU findings. (FHA & VA streamline refinance transactions are permitted in accordance to respective guides).

KANSAS DU Refi Plus Owner-occupied properties in Kansas with an LTV exceeding 100% require a full appraisal report

MAINE ALL • Loans with the Right of Rescission, it is required to have funds in the closing agents account by 12:00 noon (Eastern Time) of the next business day following the expiration of the

rescission period. Funds must be wired to the closing agent’s account the last day of the rescission period to ensure we meet the strict timing guidelines. We are not entitled to receive/charge any interest on the loan proceeds until disbursement by the settlement agent has occurred. Due to this, no-pre-funding conditions other than signed 1003 allowed.

• The adjustment cap for first lien ARM loans is restricted to a maximum increase of 2% per year.

• 30/15 and 40/30 first-lien balloon loans originated in Main are ineligible for financing • All loan transactions must have FULL/ALT documentation regardless of AU findings. (FHA &

VA streamline refinance transactions are permitted in accordance to respective guides). MARYLAND ALL • All loan transactions must have FULL/ALT documentation regardless of AU findings,

including, but not limited to Streamline Accept or Accept Plus. . • FHA & VA streamline Refi’s are eligible if strictly adhered to applicable FHA/VA streamline

guides. Refinance Mortgage – Priority over Junior Liens Bill (SB199/HB88), signed into Law on 05/02/2013, effective as to certain refinance mortgage recorded or having an effective date from October 1, 2013- The act generally provides that a refinance mortgage that meets specified criteria shall have, upon recordation, the same lien priority as the 1st mortgage or deed of trust that the refinance mortgage replaces. Overview: In order to qualify, the refinance mortgage: • Must be given to secure the refinancing of the loan secured by the 1st mortgage or Deed of Trust • Secure residential property as well as refinance a mortgage that secured residence property as defined in the Act; • Be made a mortgagor to refinance in full the unpaid indebtedness secured by the 1st mortgage • Cannot exceed the unpaid outstanding principal balance secured by the 1st mortgage or Deed of Trust plus an amount not exceeding $5000 to pay closing costs; and • The principal amount secured by the subordinate lien does not exceed $150,000

MASSACHU- SETTS

ALL FHA (non-Streamline)

• Massachusetts requires the inspection of a septic system whenever a property is transferred to a different owner (Purchase money). A system must be inspected within two years prior to the transfer of title to the property served by the system. An inspection conducted up to three years before the time of transfer may be used if the inspection report is accompanied by records demonstrating that the system has been pumped at least once a year during that time.

• The following transactions are not considered transfers of title for the purposes of Massachusetts septic system transfer inspection purposes: o Taking a security interest in a property, including but not

limited to issuance of a mortgage;




o Refinancing a mortgage or similar instrument, whether or not the identity of the lender remains the same

o A change in the form of ownership among the same owners, such a placing the facility within a family trust of which the owners are the beneficiaries, or changing the proportionate interests among a group of owners or beneficiaries

o Adding or deleting a spouse as an owner or beneficiary; or a transfer between spouses during life, out-right or in trust; or the death of a spouse

o The appointment of, or a change in, a guardian, conservator or trustee

• .Borrower’s ability to repay must be documented in the loan file FHA Streamline

FHA Streamlines for properties located in MA will not be eligible for loans locked on or after 6/29/2012 and funded on or after 7/06/2012. This restriction does NOT apply to FHA WF Streamline product

State Product Restriction

MINNESOTA ALL • All loan transactions must have FULL/ALT documentation regardless of AU findings,

• FHA streamline Refi’s are eligible if strictly adhered to applicable FHA streamline guides.

MISSOURI ALL St. Louis, Green Jade Estates Subdivision: Financing is not allowed.

MONTANA ALL No loan may be secured by property of more than 40 acres.

NEVADA ALL • High-rise Condo projects (> 5 stories) are not eligible in Las Vegas, Nevada • All loan transactions must have FULL/ALT documentation regardless of AU

findings. (FHA streamline refinance transactions are permitted in accordance to respective guides).

Reminder: Additional restrictions may be posted in product guide. NEW JERSEY FHA/VA • All 2-4 Units in the State of New Jersey are ineligible for financing

NEW JERSEY ALL All purchase transactions are subject to the Private Well Testing Act, N.J.S.A. 58:12A-26 requirements. The Act covers SALES of properties for which testing is required for the following: • SALE of any property that gets its drinking water from a private well located on the

property, and SALE of any property that gets its drinking water from a well that has less than 15 service connections or that does not regularly serve an average of at least 25 people daily at least 60 days out of each year

New Mexico ALL • Sierra must deliver the new loan funds within 2 business days of the time it is ascertains the closing agent as fulfilled the conditions/required/requested in our lender’s instructions. Due to this, no prefunding conditions will be allowed other than the signed 1003.

NEW YORK ALL M.I. insurance determination requirements according to NY Insurance law Article 65 Section 6503(d) applies: LTV must be calculated by dividing the loan amount by the appraised value. If the result is >80%, MI is required. If M.I. is required, the percentage of coverage is determined by dividing the loan amount by the lesser of the sales price or the appraised value.

NORTH CAROLINA

ALL • Loan funds must be disbursed no later than the business day after the expiration of the required rescission period. We are not entitled to receive/charge any interest on the loan proceeds until disbursement by the settlement agent has occurred. Funds must be wired to the closing agent’s account the last day of the rescission period to ensure we meet the strict timing guidelines. Due to this, no prefunding conditions will be allowed other than the signed 1003.

• All loan transactions must have FULL/ALT documentation regardless of AU findings, including, but not limited to Streamline Accept or Accept Plus. Please refer to SPM P&P Income Waiver section for details.

• FHA & VA streamline Refi’s are eligible if strictly adhered to applicable FHA/VA streamline guides

OHIO ALL • All loan transactions must have FULL/ALT documentation regardless of AU findings. (FHA & VA streamline refinance transactions are permitted in accordance to respective guides).

Non-Agency Jumbo

• Eligible in the state of Ohio. (previous restriction removed)




SOUTH CAROLINA

ARM PRODUCTS

o New regulations under Senate Bill 673 are effective January 1, 2010*. The High-Cost and Consumer Home Loans Act have been revised to require the calculation of a fictitious annual percentage rate (APR) on an adjustable rate loan for purposes of the High Cost Rate test.

o A loan is considered High Cost if the loan’s APR exceeds the specified rate threshold. Under these revisions, the APR on an adjustable rate loan must be calculated using the fully indexed interest rate assuming a fully amortizing repayment schedule.

o The maximum TDTI cannot exceed 50% or it will be considered a high cost loan. We must use PITI + debts to arrive at TDTI ratio.

ALL • A fully executed Attorney/Insurance Preference Checklist form, which informs the

borrower of their right to select their own attorney or insurance agent must be obtained for all Primary and Second Home loan transactions. This fully executed form must be included in the loan file for salability purposes. Note: This requirement does not apply to investment properties.

• South Carolina Unauthorized Practice of Law: real estate and mortgage loan closings, including refinance loans, must be supervised by an attorney. Performing a title search, preparing title and loan documents, and closing a loan without the supervision of an attorney constitutes the unauthorized practice of law.




Continued from previous page

State Product Restriction

TENN ALL Loans subject to a Right of Rescission, Sierra is required to provide the settlement agent the funds no later than the business day after the rescission period expires. Due to this, no prefunding conditions will be allowed except for the signed 1003.

TEXAS ALL (except A6)

• All owner occupied refinance transactions for all products [except Section 50(a)(6)] loans will require a copy of the current mortgage or note evidencing the terms are not subject to Texas 50(a)(6) requirements. Note: Texas (a)(6) loans would already have been identified as such.

TEXAS Section 50 (a)(6) ArticleXVI

Conven-tional (Except DU Refi Plus and Sierra Direct)

• Refer to SPM Texas A6 policy posted in P&P • Per Court Ruling June 21

st, 2013- Discount points are to be included in the 3% cap –

on true interest (Principal x Interest Rate) is excluded • NO POA Allowed on Texas A6 transactions

DURP Not Eligible

Sierra Direct

Not Eligible

Non-Agency Jumbo

Not Eligible

FHA Not eligible for financing under this product VA Not eligible for financing under this product

VIRGINIA ALL • Loans subject to the Right of Rescission, loan funds must be provided to the settlement agent within 1 business day (the next day) after the expiration of the rescission period. We are not allowed to receive/charge the customer any interest on the loan funds advanced until disbursement of the funds by the closing agent. Due to this, no prefunding conditions will be allowed except for the signed 1003.

Vermont ALL • Loans subject to the Right of Rescission, Sierra must disburse loan funds to the settlement agent prior to 2:00 pm (Eastern Time), the first business day after the rescission period expires. We are not entitled to receive/charge any interest on the loan proceeds until disbursement by the settlement agent has occurred. Funds must be wired to the closing agent’s account the last day of the rescission period to ensure we meet the strict timing guidelines. Due to this, no prefunding conditions will be allowed except for the signed 1003.

WEST VIRGINIA

ALL Loans subject to the Right of Rescission, loan funds must be provided to the settlement agent within 1 business day (the next day) after the expiration of the rescission period. We are not entitled to receive or charge any interest on the loan until disbursement of the loan funds by the settlement agent has occurred. Due to this, no prefunding conditions will be allowed except for the signed 1003.

• The maximum allowable LTV/CLTV is 100%\ • Reduced appraisal reports are not acceptable: Minimum #2055 is required if AUS

permits and not otherwise restricted in product guide. Conven-tional

As a result of the recent legislative alert for the state of West Virginia, the DTI will be restricted to a maximum of 50%. Borrower ability to repay must be documented.

Homepath The HomePath product is not eligible in the state of West Virginia *This table ONLY lists existing Geographic Restrictions as applicable to state locations. This table is NOT intended to reflect SPM licensing status, or lending territory information. Branches must refer to their compliance tables and managers for licensing information and authorization to conduct business in specific states

.

“ALL” means all products offered by Sierra Pacific Mortgage, including Government (USDA, FHA & VA) loan transactions.




Exhibit “A” – State of California

• The following restrictions apply to properties located in the state of California:

o Big Rock Mesa (Malibu) and Castellamare (Pacific Palisades)- All of the following conditions apply to any loan if the subject property is located in the Castellamare area of Pacific Palisades or on the following streets in the Big Rock Mesa Area (Malibu):

Due to earth slippage and land slides, the following conditions apply: � Verify soil engineer’s report stating soil is stable and not subject to future expansion,

slippage or slide activity. � Verify structural engineer’s report confirming dwelling and any outbuildings or garages have

not been affected by soil expansion, slippage or land slides and are in, at least, good conditions.

� Homes on septic system are not acceptable. � Borrowers must sign a Borrower Property Indemnification Certification. � For more specific location information, the referenced streets may be located in the most

current copy of the Thomas Bros. Guide for Los Angeles County o Oakley, Contra Costa County: Restriction removed for Dupont Chemical plant. o La Conchita Area (San Buena Ventura) - this area is known to have experienced earth

slippage and landslide problems. All of the following conditions apply to any loan if the security property is located in these areas � Clear soil engineer’s report stating that the subject soil is stable and not subject to future

expansion, slippage, or slide activity. � Clear structural engineer’s report confirming that the subject dwelling and any outbuildings,

garages, etc. have not been affected by soil expansion, slippage, or landslides and are in at least good condition.

� Borrowers are required to sign the La Conchita Area (San Buena Ventura) Borrower Property Condition Indemnification Certificate.

� The properties located on the following streets in the La Conchita area are subject to all three conditions above:

Vista Del Rincon Drive San Fernando Avenue Carpinteria Avenue West Surfside Street Zelzah Avenue Santa Paula Avenue Bakersfield Avenue Santa Barbara Avenue North Sunland Avenue Fillmore Avenue Ojai Avenue Oxnard Avenue

All properties are a portion of Sections 1 and 12 of La Conchita Del Mar No. 2, Book Page 31. La Conchita is an unincorporated area of Ventura County, CA.

Big Rock Drive Piedra Chica Road

Rockport Way

Cool Oak Way Pinnacle Way Royal Stone Drive

Inland Way Roca Chica Drive

Seaboard Way

Little Rock Way Rockcroft Drive Seamore Drive

McAnany Way Rockpoint Way Whitecap Way

Documents

Sierra Pacific Mortgage Geographic Restrictions fileSierra Pacific Mortgage Geographic Restrictions Geographic Restriction Table 2 Rev 04/07/2014 Rev 04/07/2014