Policies

Currently AFR distinguishes between its Correspondent clients by identifying them with one of two (2) Lender ID Codes.

They are as follows:

• C : Correspondent Without Delegated Authority
• CDE : Correspondent With Delegated Authority

Understanding these codes will assist each client in determining how they will price and lock their files while loans are in process with American Financial Resources, Inc.

• The AFR Lock Desk is open Monday through Friday weekly
  • The AFR lock desk will be closed for all legal and pre-announced holidays. Please visit www.afrwholesale.com for announcements pertaining to these closings.
• Hours of operation for the lock desk are 10:00am ET through 11:00pm ET
  • During the above hours, AFR’s lock desk will accept new locks, extensions, re-locks, renegotiations and revisions.
  • Any item submitted from 10:00am ET through 6:00pm ET will be processed same day with confirmation posted to your account.
  • Any item submitted between 6:00pm ET and 11:00pm ET will be processed the following morning and confirmed upon completion prior to the opening of business.

The AFR lock desk can be contacted in the following methods:

• Email: LockDesk@afrwholesale.com
• Phone: 1-877-588-2706
• Chat: AFR Pricing/Lock Questions

American Financial Resources, Inc. posts its Correspondent rate sheet daily at approximately 10:00am ET.

• Once posted, rates and pricing are subject to change via an updated and time-stamped rate sheet without prior notification anytime through 11:00pm ET.

For our Correspondent division, all loans can be locked as soon as they are registered in AFR’s system. The loan milestone for an individual file can be viewed within your pipeline at any time.

All locks must be submitted via the client’s pipeline in AFR’s system.

• Once in the pricing system, the pricing search form will be displayed for the client
• Upon submitting the pricing search, the client will be presented with two options
  • Eligible
    • This will present the rates and programs a file is qualified to lock-in.
    • Qualification is based solely on the loan level information listed at the time of lock in AFR’s system.
  • Ineligible
    • This will list the programs a file is not qualified to lock
• Once a client finds pricing they wish to lock, they can select the rate they wish to lock.
• If a loan qualifies under AFR’s guidelines but the system is not allowing to lock the loan in, a manual lock request form can be submitted.
• All requests must be requested directly by the client to the AFR lock desk.

The executed notes must be delivered to AFR prior to the expiration (11:00pm ET) of their lock.

• If a client knows they will not be able to deliver their closed package by their current lock expiration they can request an extension as outlined in our extension policy.

Once a closed loan has been successfully delivered to AFR, they will receive a fifteen (15) day grace period in which AFR must purchase their closed loan.

• No extension fees will be charged for this 15 day grace period.
• If the loan is not purchased by the 15th day of this grace period, it will be assessed a cost of 0.018 (as outlined in AFR’s extension policy) for each additional day required before purchase.
  • Once a closed loan package has been received, the loan will be ineligible to be re-locked.

If a client does not deliver their closed loan package by the expiration of their lock AFR will allow a 10 calendar day grace period for delivery.

• The 10 calendar day grace will begin at the lock expiration date at the time the file was delivered.
• For each day that passes between the lock expiration and confirmed delivery of the closed package (up to 10 days), AFR will assess an automatic extension fee of 0.018 per calendar day.
• AFR will give a 15 calendar day grace period beginning on the date the closed package is received during the late delivery period, to allow for purchase of the loan.
  • If the loan is not purchased by the tenth day of this grace period, it will be assessed a cost of 0.018 (as outlined in AFR’s extension policy) for each additional day required before purchase.

Should a client not deliver their closed package prior to their lock expiration or delivery within the 10 calendar day late delivery period, AFR will consider the client to have missed their delivery date.

• A file whose closed loan is delivered after both their lock expiration and late delivery period will require a re-lock subject to the terms set forth in our re-lock policy.

If a client knows they will not deliver the closed loan package by the expiration date indicated on their most recent lock confirmation, a lock extension can be requested.

To extend a lock, a client must log into their pipeline within AFR’s system.

Extension requests must be submitted to American Financial Resources, Inc. prior to 11:00pm ET on a business day.

• Extensions received after 11:00pm ET M-F, or on weekends will be rejected and require re-submission (provided the lock will not be considered expired) on the next business day.
• In the event an extension request is rejected, the client will be notified via e-mail stating the reason for the rejection.

Lock Extension Policy

AFR reserves the right, in its sole discretion, to grant or deny a request for a Rate Lock Extension on all loan products. A Rate Lock Extension may not result in the total rate lock duration exceeding 90 days. A per calendar day cost of 0.018% of the total loan amount will be applied for each day a lock is extended. As an example, if an extension is needed for 10 days and the loan amount is $100,000 that would cost you $180 (.00018 x 10 days = .0018 x 100,000 = $180).

No lock may be extended for more than 30 days

• 30-day initial lock, cannot be extended past the 60^th calendar day from the date of the original (initial) lock.
• 45-day initial lock, cannot be extended past the 75^th calendar day from the date of the original (initial) lock.
• 60-day initial lock, cannot be extended past the 90^th calendar day from the date of the original (initial) lock.
• If a file has reached its extension cap as indicated above, and has not yet closed, the loan will be required to re-lock based on AFR’s re-lock policy below.

In order to ensure a smooth closing process for all loans, we ask that extension requests be submitted at least 24 hours prior to a scheduled closing.

If the AFR system is not allowing for an extension but an extension is still available, an e-mail can be send in directly to the lock desk by the client.

All requests must be requested directly by the client to the AFR lock desk.

Lock Extensions requested during large market movements may be denied. Exceptions for the extension will be needed when the Fannie Mae 30 day mandatory delivery rate has changed more than 35 bps since the date of the lock. The 30 Day Mandatory Delivery rate can be found here: https://www.fanniemae.com/content/datagrid/hist_net_yields/cur30.html

• Please email Lockdesk@AFRwholesale.com with any questions to this policy change.

A per diem cost of 0.018 will be applied for each day a lock is extended.

• A per diem extension request in which the expiration date would fall on a weekend or holiday will require an additional cost be added to the extension.
• If the extension duration falls on a weekend we will add the necessary duration and cost to the extension to bring the lock expiration date to the next business day.
  • Example: An extension request for 1 day at the cost of 0.018 for a file expiring on Friday, which results in a Saturday expiration will result in an additional 0.036 adjustment being applied for both Saturday and Sunday.
• If the previous lock’s true expiration date should have expired on a weekend (Saturday, Sunday) or designated holiday, the lock confirmation will always show an expiration date of the following Monday.
  • Example: A 30 day lock should expire on a Sunday, however the confirmation shows the following Monday. When the next extension is requested that one day will automatically be charged in the extension.

A re-lock on a file can be requested either when a lock on the file has expired or if the maximum extension period “30 days” has been reached. AFR will determine, in its sole discretion, whether a re-lock request is approved or denied.

Re-locks will be based on worse case pricing for all wholesale channels. AFR is offering a 15 day and 30 day re-lock option.

15 day re-lock:

• If 15 day pricing on the day of the re-lock request is worse compared to the pricing currently on the lock, the loan would get the price from the day of the request.
• If 15 day pricing on the day of the re-lock request is better compared to the pricing currently on the lock, the loan would keep the price from the previous lock.

30 day re-lock:

• If 30 day pricing on the day of the re-lock request is worse compared to the pricing currently on the lock, the loan would get the price from the day of the request.
• If 30 day pricing on the day of the re-lock request is better compared to the pricing currently on the lock, the loan would keep the price from the previous lock.

To re-lock a loan, the client must log into their AFR Loan Center.

In order to qualify for a rate or pricing negotiation, one of the following criteria must be met.

• Rate renegotiations
  • The base price for the lower rate being requested must be higher on the date of the request than the base price of the currently locked rate by at least 0.250%.

• Pricing renegotiations
  • The base price of the currently locked rate must be at least 1.000% higher on the date of request than the base price from the rate sheet on the date the lock was confirmed.

If the above qualifications are met, a client may submit a negotiation request to AFR.

• All renegotiation requests will be reviewed on a loan by loan basis.
• Approval of all renegotiation requests is at the sole discretion of AFR management. There is no guarantee a renegotiation request will be approved even if it meets the above stated criteria.
• If a renegotiation request is submitted on a file not qualifying per the above guidelines, the request will be rejected via e-mail to the client.

To request a renegotiation, the client must send a detailed e-mail with the borrower’s full name and AFR loan # to lockdesk@afrwholesale.com