Jumbo Non-Conforming Products (Series-49)

Jumbo Non-Conforming Products (Series-49) This guide provides parameters for standard fixed rate and 5/1, 7/1, and 10/1 adjustable rate, fully amortizing, nonconforming products for primary residence up to 2 units and 2nd Home properties within certain eligibility restrictions described below. JF3049 Jumbo 30-YR Fixed JF1549 Jumbo 15-YR Fixed JA10L49 Jumbo 10/1 ARM JA71L49 Jumbo 7/1 ARM JA51L49 Jumbo 5/1 ARM Minimum Loan Amounts Number of Units Contiguous States Alaska and Hawaii 1 Units $417,001 $625,501 2 Units $533,851 $800,776 Owner Occupied Properties - LTV, CLTV, and Loan Amount Chart Loan Purpose Property Type Minimum Credit Score LTV/CLTV ( 1)(2) Purchase and Rate/Term Refinance (7) 1-Unit, PUD, Warrantable Condo, Co-op 2 Unit 720 Maximum Loan Amount (6) 80 / 80 $1,500,000 75 / 75 $1,750,000 70 / 70 $2,250,000 65 / 65 $2,750,000 60 / 60 $3,000,000 700 70 / 70 $1,500,000 700 65 / 65 $1,000,000 720 60 / 60 $1,500,000 Cash Out Refinance (3)(4)(5) 1 Unit, PUD, Warrantable Condo 700 720 65 / 65 (4) $1,500,000 60 / 60 (5) $1,750,000 55 / 55 $2,000,000 45 / 45 $2,500,000 35 / 35 $3,000,000 Second Homes - LTV, CLTV, and Loan Amount Chart Loan Purpose Property Type Minimum Credit Score LTV/CLTV (1)(2) Maximum Loan Amount 80 / 80 $1,000,000 Purchase and Rate/Term Refinance 1 Unit, PUD, Warrantable Condo, Co-Op 720 70 / 70 $1,750,000 65 / 65 $2,250,000 50 / 50 $2,500,000 40 / 40 $3,000,000 1) LTV/CLTV is reduced by 5% on properties in declining markets as indicated by appraiser. 2) New subordinate financing is allowed only up to maximum LTV/CLTV. 3) For Cash Out transactions, maximum cash out amount permitted is $350,000 to 65% LTV/CLTV 4) For Cash Out transactions, maximum cash out amount permitted is $500,000 to 60% LTV/CLTV 5) To be eligible for a Cash Out refinance transaction, the loan being paid off must be seasoned for at least six months. 6) First Time Home Buyer Maximum Loan Amount $1,200,000 7) The refinancing of non-purchase money closed end and HELOC 2 nd liens will be considered a rate/term refinance if they are seasoned > 12 months and the draw on the HELOC is not greater than $2,000 within the last 12 months 8) Total debt ratio maximum is 43%

Jumbo Non-Conforming Products (Series-49) Product Series Guidance LOS Program Codes Underwriting Method Eligible States Ineligible Products/Attributes Eligible Borrowers This matrix is only an abbreviated version of the product series guidelines. Anything not specifically addressed within should be directed to Choice Lending. Guidelines can change at any time without notice. JF3049: 30YR Fixed; JF1549: 15 YR Fixed JA10L49: 10/1 ARM; JA71L49: 7/1 ARM; JA51L49: 5/1 ARM All loans must be manually underwritten and fully documented. Second Signature required by Choice Lending Corp (CLG), Corporate Management. All loans must be underwritten in compliance with the Ability to Repay standards set forth in Appendix Q. For additional topics not specifically or fully addressed by Appendix Q guidance or herein, Fannie Mae underwriting guidelines should be followed. All loans must meet the Ability to Repay and Qualified Mortgage provisions of the DoddFrank Act. All approved states within lending channel. Interest Only Negative Amortization Graduated Payments Temporary Buydowns Balloon Payments Loans with Prepayment Penalties Ineligible Borrowers Eligible Properties Types U.S Citizens First Time Home Buyer o A First Time Homebuyer is an individual that has not had a mortgage in the past or owned a home in the past 3 years. Permanent Resident Aliens o A Permanent Resident Alien is an individual who permanently resides in the United States. Lawful permanent resident aliens of the United States are eligible for financing under the same terms that are available to U.S. Citizens. Non-Permanent Resident Aliens (on a pre-approved basis) o Must have a an unexpired passport from their country of citizenship containing INS form I-94 which must be stamped Employment Authorized o An Employment Authorization Card along with a copy of the Petition for NonImmigrant Worker (form I-140) in file o The borrower(s) must have a minimum of 5 years residency, with the likelihood of employment continuance for at least 3 years. o Owner Occupied only, Single Family and Condo o Only H1B and H2B Visas are accepted o Visa must have a minimum remaining duration of 3 years o Borrowers with diplomatic immunity or A1, A2, or A3 Visas are ineligible o 70% LTV/CLTV Maximum Inter-Vivos Revocable Trust Foreign Nationals Irrevocable or Blind Trusts Limited partnerships, general partnerships, corporations Non-Occupant Co-Borrowers One Unit Single Family Residences (Attached and Detached) and PUDs (Attached and Detached) Warrantable Condominiums 2-Unit Properties (within matrix parameters) Co-ops that met FNMA eligibility standards(limited basis) Acreages > 10 and <= 20 must be typical for area, maximum 35% land to value, and no income producing attributes. Agricultural zoned properties may be eligible. Hobby Farms must meet the following criteria: o Appraisal photos must not show any indication of agricultural use on the subject

Jumbo Non-Conforming Products (Series-49) property. o Appraiser does not indicate any previous agricultural use on the subject property. o Subject property s site is common for the area. o Schedule E of tax returns shows no income from the subject property. o Borrower s profession is not agriculturally related. Ineligible Property Manufactured homes Types Condotels Multi-unit (3-4 unit primary residences and 2-4 unit second homes) Mixed use properties Log Homes Unique properties Maximum 20 acres Property with income producing attributes Credit Score Requirements A full residential mortgage credit report (RMCR) or Tri Merged in file conforming to Fannie Mae or Freddie Mac requirements must be used. The RMCR or tri merged in file must reflect credit scores from all 3 repositories. Every submitted credit bureau report must include the full name, address and social security number of each borrower. If any of this information is inconsistent with that on any document in the file, a new report will be required. Credit Report is good for 90 days, from application to closing. Qualifying Rate Unless other requirements are set forth by applicable law: 5/1 ARM must be qualified at the Note Rate + 2% never less than the fully indexed rate based on a fully amortizing principal and interest payment; 7/1 and 10/1 ARM must be qualified at the Note Rate based on a fully amortizing principal and interest payment. Margin is a component of pricing and may be subject to change. Refinance-Listed Properties that had been offered for sale must be delisted six months prior to application date. Property Refinance Rate and Term The refinancing of non-purchase money closed end and HELOC 2nd liens will be considered a rate/term refinance if they are seasoned > 12 months and the draw on the HELOC is not greater than $2,000 within the last 12 months Properties owned < 12 months, use the lesser of the original purchase price or new appraised value. Not specified, contact Underwriting for details Delayed Purchase Refinance Refinance-Cash Out Properties owned < 12 months, use the lesser of the original purchase price or new appraised value. To be eligible for a Cash Out refinance transaction, the loan being paid off must be seasoned for at least six months. Maximum cash out amount permitted is $350,000 to 65% LTV/CLTV Maximum cash out amount permitted is $500,000 to 60% LTV/CLTV Appraisal Purchase Transactions: Two Appraisals required for all loans > $1,500,000. Refinance transactions: Two Appraisals required for all loans > $1,000,000 Interior photos required. Appraisals good for 120 days. New appraisal required after 120 days. Properties owned < 12 months, use the lesser of the original purchase price or new appraised value. For cash-out transactions, properties that had been offered for sale must be delisted six months prior to application date. Appraisals should be sent to Investor for review prior to close. A new appraisal is required for both purchase and refinance transactions (appraisal update / recertification of value not permitted). Recast Option Not available Prepayment Penalty Not permitted Option Conversion Option Not allowed Buy down, Temporary Not allowed Assumable Fixed Rate products are not assumable.

Jumbo Non-Conforming Products (Series-49) ARM products are assumable to a qualified borrower after the fixed term Interest Only Not allowed Index 1 Year Libor Margin 2.25 Interest Rate Caps 5/1: 2/2/5 (initial/subsequent/lifetime) 7/1 & 10/1: 5/2/5 The Loan is subject to the indicated Rate Cap Adjustment (up or down), but the Adjustment may never be greater than the Lifetime Adjustment over the Note Rate. The Loan Interest Rate can never adjust lower than the Margin. Terms Fixed :360 months and 180 months ARM: 360 months Amortization Fully amortizing Special Features and Construction Loans: Not Permitted Specifications Non-Arm s length transaction are not eligible with the exception of the following: o The borrower is the employee of the origination lender and the lender has an established employee loan program Limited Cash-out: Will be considered as the lesser of 1% or $10,000 Income Full Income Documentation is required. For most income types, this would include: Employed Borrowers: Most Recent Paystub including year-to-date earnings (covering minimum of 30 days) and two years W2's. All borrowers must be qualified using current verifiable income, not projected income. Self-Employed Borrowers: Two years personal returns (along with all schedules) and business tax returns (for businesses where borrower has 25% or more ownership interest and the income from the businesses are being used for qualification). In addition, Verbal Verification of Employment required for all borrowers and must be completed: Within 10 calendar days prior to the closing date for employment income Within 30 calendar days prior to the closing date for self-employment income. VVOE for Self Employed income should include verification of a phone listing and address for the borrower s business AND verification through a third party such as a CPA, regulatory agency or applicable licensing bureau. If contact is made verbally, the loan file must be documented to identify both the source of the information obtained and the name & title of the person who obtained the information. IRS Form 4506T is required to be signed and executed during the origination process, and transcript documentation for the most recent two years must be provided in the closed loan file. For selfemployed borrowers, this applies to both personal returns and business returns (for businesses where borrower has 25% or more ownership and the income from the businesses are being used for qualification). Assets Form 4506T must also be signed at closing. Full Asset Documentation is required for both funds to close and reserves. For most asset types, this would include all pages of the most recent two months statements or the most recent quarterly statement. All deposits/ gifts must be verified with the borrower(s) All deposits/ gifts must be verified with the borrower(s) Borrower must disclose, and lender must verify, all assets. Business accounts are not eligible to help meet reserve requirements; the underwriter may consider business accounts for funds to close if the borrower is 100% owner of the business, and a letter from the business accountant is obtained to confirm that the withdrawal will not negatively impact the business. Stocks/Bonds/Mutual Funds - 70% may be used for reserves. Vested Retirement Account funds 60% may be considered for reserves.

Reserves Jumbo Non-Conforming Products (Series-49) If needed to close, verification that funds have been liquidated (if applicable) is required. Gifts from relatives are allowed (min 5% Borrower contribution required). Gift of Equity not allowed Grant Funds not allowed. Pooled funds not allowed. Builder Profits not allowed. No Employer Assistance Assets. Reserves Primary Residence Loan amounts up to $1,000,000: 6 months verified PITI (12 months for First Time Home Buyers) Loan amounts $1,000,001 up to $1,500,000: 9 months verified PITI (18 months for First Time Home Buyers) Loan amounts $1,500,001 up to $2,000,000: 12 months verified PITI Loan amounts $2,000,001 up to $2,500,000: 24 months verified PITI Loan amounts $2,500,001 up to $3,000,000: 36 months verified PITI Documentation Requirements Housing Payment History Reserves Second Home Loan amounts up to $1,000,000: 12 months verified PITI Loan amounts $1,000,001 up to $1,500,000: 18 months verified PITI Loan amounts $1,500,001 up to $2,000,000: 24 months verified PITI Loan amounts $2,000,001 up to $2,500,000: 36 months verified PITI Loan amounts $2,500,001 up to $3,000,000: 48 months verified PITI Reserves Borrower has > two financed properties 6 months reserves for each additional financed property Full income and asset verification Mortgage or Rental history must be 0x30 over prior 24 months Rental history evidenced by Institutional VOR or 24 months proof of payment (12 months for FTHB) Credit History The representative credit score for each borrower is the median of the three scores (or lesser of two, if only two scores are returned); the representative score for the loan is that of the borrower with the lowest representative score. Each Borrower s credit profile must include a minimum of 3 open trade lines and meets the following requirements: One must be open and active for 24 months, at least one of the 3 trade lines must be an installment or mortgage account, and the remaining trade line must be rated for 12 months. If a borrower can t meet the minimum of 3 tradelines but has a minimum of 1 open tradeline with 12 months or more reporting, it could be considered without exception if the borrower meets the following criteria:8 or more tradelines reported with at least one being a mortgage tradeline and having a minimum of 7 yrs. of established credit history (A borrower not using income to qualify and showing $0 earned or is not employed; does not need to meet the minimum tradeline requirement listed above.) OR 6 months additional reserves and meets one of the following loan parameters: DTI < 35%, LTV < 65%, or FICO > 740. A written explanation for all inquiries within 90 days is required. Prior Bankruptcy not allowed (any type) Prior Foreclosure, Short-Sale, or Deed-in-Lieu or not allowed Loan Modifications are not permitted, unless the modification is lender initiated and documented proof that it was not a distressed situation is provided All Judgments or liens affecting title must be paid Non-title charge-offs and collections exceeding $1,000 (either individually or in aggregate) must be paid All past due accounts must be brought current prior to closing. Borrowers with a history of collection accounts should be required to pay off derogatory accounts No Authorized User Accounts will be used to satisfy minimum trade line or FICO requirements

Subordinate Financing Jumbo Non-Conforming Products (Series-49) Cash out may not be used to pay down debt to qualify for the loan Borrowers cannot pay down revolving debt within 90 days of the credit report in order to qualify for the loan nor pay down installment debt to 10 payments or less to exclude payment from DTI calculations. Revolving and installment debt can be excluded from calculations if the accounts are closed and proof is provided New subordinate financing not permitted. Project Eligibility Condos must be warrantable. Condo projects with less than 10 units must be typical for the area and the appraisal must show similar comparables. Contributions to Closing Costs Interested Party Contributions are allowable in accordance with FNMA standards. Amounts in excess of the limits set forth by FNMA or additional cash back to the borrower for any contributions that exceed the actual amount of closing costs are considered to be sales concessions and must be treated accordingly (deducted from sales price when calculating LTV) Multiple Property Ownership Number of properties owned: the maximum is five financed properties per borrower (note: additional reserve restrictions apply for > two financed properties) Escrow Waivers Investor will not purchase more than 5 loans from one borrower Borrowers will be required to have 6 months reserves for each additional financed property. Not specified. See Underwriting for details.