ESCROW ACCOUNT OPTION NOTICE TO BORROWER

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File: mission standard disclosure set (short).PCD, Page 2 of 7

ESCROW ACCOUNT OPTION NOTICE TO BORROWER

The mortgage interest rate and discount points agreement which you are entering into with Mission Mortgage is based on the assumption that you will be making monthly escrow payments to the loan servicer for real estate taxes, assessments and hazard insurance premiums.

As an applicant for a conventional loan with an 80% or lower loan-to-value ratio made by Mission Mortgage, you may be offered the option of paying your own real estate taxes, assessments and hazard insurance premiums listed below. Such option may be extended by Mission Mortgage, but we reserve the right to charge an additional one-quarter (1/4) discount point to you for this option.

Please indicate one choice, then sign and date in the space provided below:

 I/We hereby elect to pay my our real estate taxes, assessments and hazard insurance premiums directly and accept the terms under which this option is extended, including the obligation to start making monthly escrow payments and to reimburse the loan servicer for any expense it incurs to correct any default if I/we fail to pay my/our taxes, assessments and hazard insurance premiums when due. By electing this option, I/we agree to pay one-quarter (1/4) additional discount point. I/we understand that no escrow account services will be provided for payment of taxes and hazard insurance by the loan servicer.

 I/We wish to make monthly escrow payments to the loan servicer for my/our real estate taxes, assessments and hazard insurance premiums.

______________________________________________________ _____________________

Signature of Applicant Date

______________________________________________________ _____________________

Signature of Co-Applicant Date

Mission Mortgage of Texas, Inc.

Barton Oaks V, 901 S. Mopac Expwy., Suite 120, Austin, Texas, 78746 Telephone: (512) 328-0400 Fax: (512) 328-0472

www.missionmortgage.com

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NOTICE TO MORTGAGE LOAN APPLICANT:

APPRAISAL ALTERNATIVES

As part of the review of your mortgage loan application, Mission Mortgage may obtain an alternative type of property valuation rather than an appraisal. This means that the acceptability of your property as collateral for your loan may be confirmed by a property valuation model and/or an exterior-only inspection, or by some other means that is not an appraisal of the property. This appraisal alternative, that Mission Mortgage obtains, is for lending purposes only and should not be relied upon to protect your interests in the transaction (for example, to confirm the purchase price of the property). If you prefer, you may request an appraisal in lieu of an appraisal alternative.

_________________________________________ __________________________

SURVEY DISCLOSURE

 I/We intend to use the seller’s survey or existing survey.

As part of the closing of your mortgage loan, a clear property survey is required. In some cases, a copy of the seller’s survey if available may be acceptable to satisfy this requirement. There cannot have been any improvements made to the property since the survey was done.

The title company will review the survey for acceptability. The title company does not cover loss resulting from any discrepancies, conflicts or shortages in area or boundary lines, any encroachments or protrusions, or any overlapping of improvements. In order to obtain title insurance coverage for these items, an owner must purchase what is commonly called “survey deletion” coverage. The cost for this coverage is an additional 15 percent of the owner’s title policy premium. Please contact your agent to inquire if a copy of the seller’s survey is available and advise your loan officer or processor within 5 days from receipt of this notice if you intend to use the seller’s survey.

 I/We will require a new survey (additional time may be required to complete a new survey).

_____________________________________________ ____________________

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Applicants A, B, and any other applicants must initial each applicable item below.

Equal Credit Opportunity Act

I/We have read and understand the following notice:

The Federal Equal Credit Opportunity Act prohibits from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided that the applicant has the capacity to enter into a binding contract); because all or part of the applicant’s income derives from any public assistance program or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The Federal Agency that administers compliance with the law concerning this creditor is the Federal Trade Commission, Division of Credit Practices, Washington, DC 20580.

____________________ ____________________

Applicant A Initials Applicant B Initials

Real Estate Settlement Procedures Act

I/We hereby acknowledge receipt from Mission Mortgage of an estimate of buyers closing costs and prepaid expenses relative to closing a home loan in the amount of $____________. I/We further acknowledge receipt of the HUD booklet entitled “Settlement Costs”.

____________________ ____________________

Flood Insurance

I/We agree to purchase flood hazard coverage as required by Mission Mortgage, if it is determined that the property I/we offer as security for the loan is found to be located in a Flood Hazard Area.

____________________ _____________________

Occupancy Certification

(Check One) I/We punishable by fine or imprisonment or both to make any statements known to be false concerning the above response as applicable under the Provision of Title 18, U.S. Code 1014.

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Appraisal Disclosure

You have the right to a copy of the appraisal report obtained in connection with your application for credit provided that, if required, you have paid for or are willing to pay for the appraisal. You can get a copy of this report by writing to us at the address listed below. We must hear from you no later than 90 days after you are notified about the action taken on your credit application. If you withdraw your application, you must make your request for an appraisal report within 90 days of the withdrawal. You can telephone us, instead of writing, but by doing so, you are not assured of preserving your rights.

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Consumer Handbook on Adjustable Rate Mortgages

I/We hereby acknowledge receipt from Mission Mortgage of a copy of the book entitled “Consumer Handbook on Adjustable Rate Mortgages” published by the Federal Reserve Board and the Federal Home Loan Bank Board, which is provided in addition to other required adjustable rate mortgage disclosures.

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SERVICING DISCLOSURE STATEMENT NOTICE TO FIRST LIEN MORTGAGE LOAN APPLICANTS: THE RIGHT TO COLLECT YOUR MORTGAGE LOAN PAYMENTS MAY

BE TRANSFERRED

(Pursuant to 24 CFR 3500.21)

You are applying for a mortgage loan covered by the Real Estate Settlement Procedures Act (RESPA) (12 U.S.C. 2601 et seq.) RESPA gives you certain rights under Federal law. This statement describes whether the servicing for this loan may be transferred to a different loan Servicer. “Servicing” refers to collecting your principal, interest, and escrow payments, if any, as well as sending any monthly or annual statements, tracking accounts balances, and handling other aspects of your loan. You will be given advance notice before a transfer occurs.

Servicing Transfer Information

We may assign, sell, or transfer the servicing of your loan while the loan is outstanding.

If you have any questions, please contact us.

The undersigned acknowledge receipt of this Servicing Disclosure Statement Notice on this the ________ day of __________, 2010.

_______________________________ ________________________

Signature of Borrower Date

_______________________________ ___________________________

Signature of Borrower Date

Barton Oaks V, 901 S. Mopac Expwy., Suite 120, Austin, Texas, 78746 Telephone: (512) 328-0400 Fax: (512) 328-0472

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INFORMATION DISCLOSURE AUTHORIZATION

To Whom It May Concern:

I/We hereby authorize you to release to the Mortgage Lender submitting this request for verification purposes, information concerning the following:

1. Employment history, dates, titles, income, hours worked, etc.;

1. Banking and savings accounts of record;

2. Any loans, i.e. mortgages, installment, etc., their ratings and balances;

3. Rental history and ratings;

4. Any other information necessary to determine credit worthiness.

I/We hereby authorize Mission Mortgage and/or subsequent investor to order a credit report on me/us from any Credit Reporting agency of your choice. This information is for the confidential use of the lender in compiling a mortgage loan credit package.

A photographic copy of this authorization, being a photographic copy of the signature(s) of the undersigned, may be deemed to be the equivalent of the original and may be used as a duplicate original.

I further understand that Mission Mortgage of Texas, Inc. will collect for a credit report, appraisal, and any other expenses incurred in the processing of my loan even if, for any reason, the purchase of the property is not completed.

I hereby authorize the holder of my earnest money deposit and/or my down payment to pay Mission Mortgage of Texas, Inc. the balance due for my costs incurred in processing the loan should the deposits for these items not be sufficient to pay for these costs.

Right to Financial Privacy Act

I/We acknowledge that this is notice to me/us as required by the Rights to Financial Privacy Act of 1978 that the Veterans Administration (in the case of a VA loan) or Department of Housing and Urban Development (in the case of an FHA loan) has a right of access to financial records held by financial institutions in connection with the consideration or administration of assistance to me/us. Financial records involving my/our transactions will be available to the VA (in the case of a VA loan) or to HUD (in the case of an FHA loan) without further notice or authorization but will not be disclosed or released to another government agency or department without my/our consent, except as required or permitted by law.

Signature of Applicant Social Security Number

Signature of Co-applicant Social Security Number

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AFFILIATED BUSINESS ARRANGEMENT DISCLOSURE STATEMENT - NOTICE

TO:

PROPERTY:

DATE:

This is to give you notice that Sterling Valuations (“Appraiser”) has a business relationship with Mission Mortgage of Texas, Inc. (“Mission”). Mission has an employer-employee relationship with Appraiser. Because of this relationship, this referral may provide Mission a financial or other benefit.

A. Set forth below is the estimated charge or range of charges for the settlement services listed. You are NOT required to use the listed provider(s) as a condition for settlement of your loan on the subject property. THERE ARE FREQUENTLY OTHER SETTLEMENT SERVICE PROVIDERS AVAILABLE WITH SIMILAR SERVICES.

YOU ARE FREE TO SHOP AROUND TO DETERMINE THAT YOU ARE RECEIVING THE BEST SERVICES AND THE BEST RATE FOR THESE SERVICES.

Provider and settlement service Charge or range of charges Sterling Valuations: Appraisal $300-$450

B. Set forth below is the estimated charge or range of charges for the settlement services of a real estate appraiser that we, as your lender, will require you to use, as a condition of your loan on this property, to represent our interests in the transaction.

Provider and settlement service Charge or range of charges Sterling Valuations: Inspections $50-$100 per Inspection

ACKNOWLEDGMENT

I/we have read this disclosure form and understand that Mission is referring me/us to Appraiser for the above-described settlement service(s) and may receive a financial or other benefit as the result of this referral.

______________________________________________________ _____________________

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NOTIFICATION OF EXPIRATION OF GOOD FAITH ESTIMATE

Name of Borrower:

Property Address:

Dear ,

In accordance with the requirements of the Real Estate Settlement Procedures Act, you were provided with a Good Faith Estimate of settlement service charges (“GFE”). In the

“Important dates” section on page 1 of the Good Faith Estimate, you were informed that the estimate for all other settlement charges is available through _________.

We are now past that date, and you have not expressed an intent to proceed with the loan application. Accordingly, this will serve as notice that the Loan Originator(s) is no longer bound by the GFE.

_____________________________ ________________________

Loan Officer Date

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Form Approved

OMB #0960-0760

Social Security Administration Authorization for the Social Security Administration (SSA) To Release Social Security

Number (SSN) Verification

Date of Birth ________________________________ SSN _______________________________________

Printed Name _______________________________ ______ ______________________________________________

(First) (MI) opt. (Last)

I am conducting the following business transaction

[Identify a specific purpose. Example—seeking a mortgage from the Company– “identity verification”

is not acceptable.]

with the following company (“the Company”):

Address __________________________________________________________________________________________

I authorize the Social Security Administration to verify my name and SSN to the Company and the Company’s Agent, Kroll Factual Data 5200 Hanh’s Peak Dr. Loveland, CO 80538, for the purpose I identified.

I am the individual to whom the Social Security number was issued or that person’s legal guardian. I declare and affirm under the penalty of perjury that the information contained herein is true and correct. I acknowledge that if I make any representation that I know is false to obtain information from Social Security records, I could be found guilty of a misdemeanor and fined up to $5,000.

This consent is valid for _______ days from the date signed. _______ (Please initial.)

This consent is valid only for 90 days from the date signed, unless indicated otherwise by the individual named above. If you wish to change this timeframe, fill in the following:

Signature _________________________________________ Date Signed __________________________

Contact information of individual signing authorization:

Address ________________________________________________________________________________

City/State/Zip __________________________________________________________________________

Phone Number __________________________________________________________________________

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Fee Acknowledgement

Borrower’s Name:_______________________________

In accordance with the Truth in Lending Act‐Regulation Z, I hereby acknowledge the receipt of the Truth in Lending Disclosure dated ________________________.

I further certify that I have not paid any fee, with the exception of the credit report fee, to Mission Mortgage or any representative of Mission Mortgage prior to receiving the initial Truth in Lending Disclosure.

Borrower:______________________ Date:_____________________

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Date:

Borrower:

Property:

Subject Property Address:

_____________________

City, State, Zip Code

By signing below, I waive the three (3) business day advance receipt of any appraisal(s) concerning the subject property and agree to receive a copy of the appraisal(s) at loan closing.

I understand that if I do not sign this waiver and return it to the lender, the loan closing will be delayed to accommodate the three (3) business day period for my advance receipt of any appraisal(s), as required by certain investors.

_______________________ _________________________

Borrower Date

_______________________ _________________________

Borrower Date

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UNDISCLOSED DEBT INITIAL DISCLOSURE

Borrower Name(s):

The applicant(s) hereby acknowledge that we have been counseled by our loan originator regarding the implications of incurring new debt/obligations during the loan process.

I (We) understand our obligation to notify our originator immediately if we should incur any new debt/obligations. I (We) understand our loan will then be reviewed to determine our continued eligibility.

The applicant(s) acknowledges it is a federal crime punishable by fine or imprisonment, or both, to knowingly make any false statement under the provisions of Title 18, United States Code, and Section 1014.

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Applicant Signature/Date Applicant Signature/Date

Mission Mortgage of Texas, Inc.

901 S. Mopac Building V, Suite 120 Austin, Tx 78746

Phone 512-328-0400 Fax 512-328-0472

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MORTGAGE BANKER DISCLOSURE

Pursuant to the requirements of section 157.007 of the Texas Mortgage Banker Act, chapter 157, Texas Finance Code, you are hereby notified of the following:

COMPLAINTS REGARDING MORTGAGE BANKERS SHOULD BE SENT TO THE TEXAS SAVINGS AND MORTGAGE LENDING DEPARTMENT, 2601 NORTH LAMAR, SUITE 201, AUSTIN, TEXAS 78705. A TOLL‐FREE CONSUMER HOTLINE IS AVAILABLE AT 1‐877‐276‐5550.

Applicant(s) Mortgage Banker

Signature:__________________________ ______________________________

Name:_____________________________ Name:________________________

Date:______________________________ Date:_________________________

Signature:__________________________

Name:_____________________________

Date:______________________________

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MORTGAGE FRAUD IS INVESTIGATED BY THE FBI

Mortgage Fraud is investigated by the Federal Bureau of Investigation and is punishable by up to 30 years in federal prison or $1,000,000 fine, or both. It is illegal for a person to make any false statement regarding income, assets, debt, or matters of identification, or to willfully overvalue any land or property, in a loan and credit application for the purpose of the influencing in any way the action of a financial institution.

Some of the applicable Federal criminal statutes which may be charged in connection with Mortgage Fraud include:

18 U.S.C. 4 100 1 – Statements or entries generally

18 U.S.C. 4 1010 – HUD and Federal Housing Administration Transactions 18 U.S.C. 4 1014 – Loan and credit applications generally

18 U.S.C. 4 1028 – Fraud and related activity in connection with identification documents 18 U.S.C. 4 134 1 –Frauds and swindles by Mail

18 U.S.C. 6 1342 – Fictitious name or address 18 U.S.C. § 1342 –Fraud by wire

18 U.S.C. 4 1344 – Bank Fraud

18 U.S.C. 4 408(a) – False Social Security Number

Unauthorized use of the FBI seal, name, and initials is subject to prosecution under Sections 701, 709, and 712 of Title 18 of the United States Code. This advisement may not be changed or altered without the specific written consent of the Federal Bureau of Investigation, and is not an endorsement of any product or service.

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Applicant/Date Applicant/Date