Policies

Currently AFR offers two options for our Wholesale clients. They are as follows:

• Brokered Lending: The Brokered Lending Channel is a product of AFR whereby we will underwrite, close and fund the loans for the Broker client. We will NOT contact the Applicants and all 3rd parties directly for documentation that is needed to close the loan. Those roles will be performed by the originating company.
• Brokered Lending with the On-Demand Processing Enhancement: AFR will process, underwrite, close, and fund submissions for the Broker client. We will contact the Applicants and all 3rd parties directly for documentation that is needed to close the loan.

Understanding these channels 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 visist 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 using the following methods:

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

American Financial Resources, Inc. posts its wholesale 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.

Statuses not allowing a lock to be processed are defined as follows:

• Suspended
  • File has been assigned an underwriter
  • A suspense condition has been placed on the file which must be cleared before an approval can be issued

All lock requests must be submitted via the client’s pipeline.

• Once in the pricing system, the pricing search form will be displayed for the client
  • It is important that the lock is being requested with the correct compensation method (Lender Paid or Borrower Paid). The client is responsible for selecting the correct method when requesting the lock.
• Upon submitting the pricing search, the client will be presented with two options
  • Qualified
    • 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.
  • Disqualified
    • This file will list the programs a file is not qualified to lock
      • Each program that is disqualified will show the reason for it.
      • If an approved file shows no pricing, please submit a screen capture of the disqualified loan criteria to LockDesk@AFRWholesale.com for review.
• After a lock request is submitted:
  • Lock Acceptance
    • When the lock is accepted, the client will receive an e-mail confirming the lock.
    • Once a lock is accepted, the lock confirmation will be posted to the loan
      • Locks are priced and accepted based on the information entered into the initial loan registration by the client. Loan submissions requiring a pricing adjustment due to changed data will be automatically re-priced prior to the loan closing.
    • Imaged Files:
      • For all broker clients, the lock desk will post the below documents.
        • Lock Confirmation page
        • Discount Fee Disclosure “If needed on the loan”
      • If the file is in need of a lock-in agreement, the ops team will be posting it once they reviewed the locked information for accuracy.
  • Lock Rejections
    • If a lock has been rejected, the client will receive an e-mail notification containing the reason for the rejection.

Manual lock request:

• If a loan falls within AFR’s guidelines but the system doesn’t allow for the lock request to go through, a manual lock request form should be sent directly to the lock desk by the client.

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

Extension requests must be submitted to American Financial Resources, Inc. prior to 7:00pm ET on a business days.

• Extensions received after 7:00pm 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.

AFR reserves the right to change its lock extension policy without notice. 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. FNMA Mandatory Delivery Rate

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 AFR 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 expired 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.

A re-lock can be requested through the system or via e-mail.

• If a re-lock request can’t be pushed through the system, the broker should send an e-mail directly to the lock desk requesting the extension.

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%.
    • Expired locks are ineligible for rate renegotiations.
      • An expired lock cannot be renegotiated after re-locking.

• 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.
    • Expired locks are ineligible for pricing renegotiations.

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.
• Requests must include a brief statement explaining the purpose of the request.
• Requests must be specific. “What can you do…” requests will be sent back to the requestor.
• 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 an e-mail directly to the lock desk with the scenario and what they are requesting.

• If requesting a rate renegotiation, the client must indicate the new desired rate and submit the request.
  • When submitting a rate renegotiation, AFR will need an explanation for the request entered into the notes section of the request form.
  • Rate renegotiations submitted with inadequate information may be subject to a delayed decision or automatic denial at management’s discretion.
• If requesting a price renegotiation, the client must indicate the rate they wish to keep and indicate the desired pricing.
• Once submitted the renegotiation request will be reviewed and an acceptance or counter offer will be sent back to the client via e-mail.

In the event a renegotiation is rejected, the client will be notified via e-mail with the reason for the rejection.