FAQ

• Tangible net worth must be at least $2.5MM with 20% liquidity for delegated status. Net worth requirements may vary based on type of seller approval.
• Verification of committed warehouse lines in good standing (if applicable)

• Two years audited financial statements plus interim financial statements
• Most recent quarter interim financial statements

• Enter into commitment letters and/or assign and transfer loan documents; or
• Appoint other individuals to enter into commitment letters and/or assign and transfer loan documents.

• Original signed Seller Agreement
• Articles of incorporation and by-laws (or other organizational documents)
• All state licenses and government approvals, as applicable
• All mortgage banker/broker licenses
• Resumes of key principals and senior managers, including an organizational chart
• Production type and volume breakdown, including origination source (i.e., Retail/TPO) and processing method
• Investors, MI company, and warehouse bank references with any report cards
• Quality Control Plan and if outsourced, fully executed copy of the agreement with the third-party vendor
• Approved appraiser list
• Appraiser Independence Requirements (AIR) plans

• Seller’s address or phone number changes
• Material financial changes or changes in management ordered or required by a regulatory authority
• Resignation or termination of any senior management; Seller will provide resumes of replacement personnel within 30 days of replacement
• Entry of any judgment or regulatory order where Seller is required to pay a claim which may have material adverse effect on financial condition of the Seller
• Dissolution of Seller’s business
• Notice to the Seller of an event of default on any loan sale agreements or arrangements

PHH reserves the right to suspend further business upon notification if time is required to make a determination if a continued relationship is warranted. The Seller’s failure to timely notify PHH of any of the above described changes, or any other significant changes, may result in termination.

• The Seller is duly organized, validly existing, and in good standing under the laws of the state of its organization and has all qualifications, registrations, licenses, and permits necessary to carry on its business in each state in which Seller originates or purchases loans. The Seller agrees to provide PHH with copies of all applicable licenses, permits, exemptions or approvals upon request. The Seller has all requisite power and authority to execute, deliver and perform the Seller Agreement. All requisite action has been taken by Seller to make the Seller Agreement valid and binding upon Seller in accordance with its terms.
•  No approval of the transactions contemplated by the Seller Agreement from any regulatory authority having jurisdiction over the Seller is required, or if required, such approval has been obtained. There is no claim, litigation, investigation or proceeding pending or threatened against the Seller that could materially adversely affecting the Seller’s business or the performance of its obligations under the Seller Agreement and the Seller has no knowledge of any circumstances indicating that any such suit, investigation or proceeding is likely.
• With respect to any FHA Loan submitted by the Seller, the Seller is approved by FHA to participate in its direct endorsement mortgage insurance program, or is an FHA-sponsored lender with underwriting performed by PHH. With respect to any VA Loan submitted by the Seller, the Seller is either approved to originate and submit loans to VA for VA approval, to underwrite Loans with automatic authority, or is a VA-sponsored lender with underwriting performed by PHH. With respect to any USDA Loan submitted by the Seller, the Seller is either approved to originate and submit loans to USDA for USDA approval, to underwrite Loans with automatic authority, or is a USDA-sponsored lender with underwriting performed by PHH.
• The Seller is not subject to any administrative actions and/or sanctions imposed by FHA, VA, USDA, Ginnie Mae, Fannie Mae, Freddie Mac or USDA and has not been subject to any such actions or sanctions for at least two years prior to the date of the Seller Agreement.
• The consummation of the transactions contemplated by the Seller Agreement are in the ordinary course of business of the Seller and will not result in
  • a breach of any term or provision of the organizational documents of the Seller;
  • a breach of any term or provision of, conflict with, or constitute a default under any agreement to which the Seller or its property is subject; or
  • a violation of any law, rule, regulation, order, judgment or decree to which the Seller or its property is subject.
• No representation, warranty or written statement made by the Seller in the Seller Agreement, this Guide, any application, documentation, schedule, exhibit, statement, or certificate furnished to PHH by the Seller contains any untrue statement of material fact or omits any material fact which could render such statement misleading.
• The Seller acknowledges that in the event an automated underwriting system is used to underwrite any loan sold to PHH, the Seller is fully trained in the use of such automated system and followed all appropriate procedures when using such system.

• The information set forth in the Mortgage Loan Schedule is complete, true and correct in all material respects as of the date specified therein or, if no such date is indicated therein, as of the Closing Date.
• The Seller has the authority to sell, transfer, and assign such loan on the terms set forth in the Seller Agreement and this Guide and there has been no assignment, sale or pledge thereof by Seller, (except any pledge required pursuant to a line of credit agreement between Seller and the warehouse lender previously disclosed to PHH). The loan is free and clear of liens, claims, security interests, or encumbrances of any type including, but not limited to any pledge in favor of any warehouse lender.
• All loans purchased by PHH comply with all applicable FHA, VA, Ginnie Mae, Fannie Mae, Freddie Mac, USDA, PHH and other applicable private investor regulations, requirements, standards, guidelines and all representations and warranties required to be made by sellers or sponsors therein are made by the Seller to PHH.
• All FHA Loans are fully insurable by FHA and a fully transferable mortgage insurance certificate has been or will be issued by FHA. All VA Loans are eligible for guaranty by VA and a fully transferrable loan guaranty certificate has been or will be issued by VA. All USDA Loans are eligible for guaranty by USDA and a fully transferrable loan note guarantee has been or will be issued by USDA. All conventional loans are insurable by private mortgage guaranty insurers, when required, and an appropriate certificate or other evidence of such insurance has been or will be issued by a private mortgage guaranty insurer. There are no defenses, counter claims, administrative offsets, or rights of set-off affecting the validity or enforceability of any private mortgage insurance, FHA insurance, USDA guaranty or VA guaranty with respect to the loan or eligibility of such loan for private mortgage insurance, FHA insurance or guaranty.
• All FHA Loans, USDA Loans and VA Loans are eligible for pooling in securities guaranteed by Ginnie Mae.
• With respect to the mortgagor, the mortgaged property, or the loan, there are no facts or circumstances that exist which could be reasonably expected to cause private institutional investors to regard the loan as an unacceptable investment, cause the loan to become delinquent, or adversely affect the value or marketability of the loan or related mortgaged property.
• Each loan has been originated in full compliance with all applicable law, including all applicable federal, state, and local laws, rules, ordinances, and regulations, including, but not limited to:
• All Truth In Lending Act (TILA) and Regulation Z requirements, including the ability -to- repay rules
  • All Real Estate Settlement Procedures Act (RESPA) requirements
  • All TILA-RESPA Integrated Disclosure (TRID) rule requirements
  • Equal Credit Opportunity Act (ECOA) and Regulation B
  • Fair Credit Reporting Act
  • Real Estate Settlement Procedures Act of 1974, and Regulation X
  • Flood Disaster Protection Act of 1973 (as if it were a covered entity and regardless of whether the Seller is specifically subject to such statute and/or regulations)
  • Fair Housing Act
  • Home Mortgage Disclosure Act
  • Financial Institutions Reform Recovery and Enforcement Act of 1989, as amended, including all regulations issued pursuant thereto
  • Housing and Economic Recovery Act (HERA) of 2008
  • Dodd-Frank Wall Street Reform and Consumer Protection Act and any and all regulations issued in accordance therewith
  • Any and all federal, state and local licensing requirements for mortgage brokers and/or lenders, including, but not limited to the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (S.A.F.E. Act)
  • Requirements, as applicable to the loans of FHA, VA, Ginnie Mae, Fannie Mae, Freddie Mac, USDA, and PHH. Any and all laws, rules, ordinances, and regulations relating to adjustable rate mortgages, negative amortization, and graduated payment mortgages
• Each Loan complies with the ability-to-repay standards as set forth in TILA.
• Each Loan is a “qualified mortgage” within the meaning assigned to such term of Regulation Z and is not a higher-priced mortgage loan. Each Loan qualifies for the safe harbor provided in Regulation Z and related rules and is entitled to the presumption that the lender satisfied the ability-to-repay requirements provided in Regulation Z and related rules.
• The rules, regulations, and all applicable requirements of FHA, VA, USDA, and private mortgage insurance companies, hazard insurance companies or other insurers have been properly satisfied, including, without limitation, the payment by the Seller of all mortgage guaranty and insurance premiums and fees as and when due, and the submission by Seller of enforceable insurance binders, as required by PHH. The Seller shall make PHH the loss payee of each mortgage guaranty insurance, hazard, and flood insurance policies.
• The proceeds of the loan have been fully disbursed and there is no requirement for future advances and/or disbursements. The unpaid principal balance of the loan is as stated and all costs, fees, taxes and expenses incurred in making and closing the loan and recording the mortgage have been paid.
• The Mortgage Note and the related Mortgage are genuine, and each is a legal, valid and binding obligation of the mortgagor(s), enforceable in accordance with their terms. All parties to the Mortgage Note and the Mortgage had legal capacity to execute the Mortgage Note and the Mortgage and each have been duly and properly executed by the mortgagor(s).
• The Mortgage has not been satisfied, canceled, subordinated or rescinded and no part of the property has been released from the lien of the Mortgage. The terms of the loan have in no way been changed, waived, impaired or modified, except for loan adjustments made in compliance with the Mortgage Note and applicable regulatory requirements. No waiver of any default, breach, violation or event of acceleration has occurred. The loan is current, and in the event the outstanding balance purchased has been credited with payments not yet collected and/or due to the Seller, the Seller will promptly collect said payment when due and notify PHH of any payments not made within 30 days of the due date.
• Each Credit File or Loan File and all information contained therein is true, complete and accurate. The Seller is not aware of any fact not set forth in the Credit File or Loan File which PHH might reasonably consider to be adverse to the approval of the loan, or would make the loan ineligible for sale in the secondary market.
• A title insurance commitment or a title insurance policy including all applicable endorsements has been issued by a title insurer, acceptable to PHH, insuring the Seller, its successors and assigns, or PHH as to the first priority lien of the Mortgage in the original principal amount of the Mortgage Note. The Seller has not, by act or omission, done anything which would impair the title insurance policy coverage.
• The assignment of the loan from the Seller to PHH has been duly authorized and is valid and sufficient, and all consents and approvals to such assignment have been obtained, including in the case of cooperatives, the consent of the cooperative corporation.
• All documents prepared by the Seller are genuine, accurate, and complete and meet the requirements and specifications established by FHA, VA, Ginnie Mae, Fannie Mae, Freddie Mac, USDA, PHH’s underwriting guidelines, this Guide, and the Seller Agreement, as applicable.
• There is in force such flood insurance policy as is required under the Flood Disaster Protection Act of 1973, as amended, and its implementing regulations, regardless of whether the Seller is specifically subject to such statute or regulations.
• There is in force for the loan adequate hazard and casualty insurance coverage with respect to the mortgaged property, insuring against fire or other casualties (and, if required by federal law, flood insurance), in an amount and pursuant to a policy of insurance as required by FHA, VA, Ginnie Mae, Fannie Mae, Freddie Mac, USDA, and PHH’s underwriting guidelines, as applicable. By assignment or endorsement of the Seller’s interest, PHH, its successors and assigns, is designated as a mortgagee and additional named insured with regard to such insurance.
• No mortgage brokers or other consultants or finders were consulted or contacted in connection with or in bringing about this loan or this loan sale transaction that would be due a fee from PHH.
• All taxes, governmental assessments, insurance premiums, water, sewer, municipal charges, leasehold payments, ground rents, homeowners association dues and other charges, have been paid and all funds paid or due to be paid have been paid and delivered to PHH in connection with any escrow accounts created concurrent with the funding of the Loan.
• There is no proceeding pending for the total or partial condemnation of the property and the property is undamaged by waste, fire, flood or other casualty.
• The Mortgage Note and the Mortgage are not subject to any right of rescission, setoff, counterclaim or defense, nor has any such right been asserted with respect thereto.
• The actual loan-to-value ratio of each loan does not exceed the maximum amount permitted under the PHH’s underwriting guidelines. The appraisal prepared in connection with each property provides an accurate estimate of the bona fide market value of such property and was prepared by an appraiser who must be, at a minimum, licensed or certified by the state in which the property to be appraised is located, with no direct or indirect interest in the mortgaged property.
• Any late charge provided under the terms of the loan or associated Mortgage Note does not exceed the maximum allowable late charge under applicable law.
• Appropriate escrow amounts for property taxes and insurance have been collected from borrowers in conformity with RESPA and any other applicable laws (unless expressly waived by PHH). There are no payments which are unpaid including, but not limited to taxes, ground rents, water charges, sewer rents, assessments, including any assessments payable in future installments, or other outstanding charges affecting the lien of the mortgage.
• All funds collected from borrowers have been and will be properly segregated and accounted for in accordance with all laws and regulations, and will be used for no other purpose than that for which they have been designated. All funds due FHA, USDA and VA for guarantee and insuring purposes will be promptly submitted in accordance with Agency regulations.
• No Loan is subject to the Home Ownership and Equity Protection Act (HOEPA) of 1994, as amended, or is otherwise a high-cost loan, covered loan, or any other similarly designated loan as defined under any applicable state, local, or federal predatory lending or abusive lending laws.
• All of the representations and warranties shall survive and continue in force for the full remaining life of the loan and are made for the benefit of PHH and its successors and assigns.

• PHH may, from time to time, review, at Seller’s or PHH’s place of business, Seller’s Loan Files, policies, procedures, and records, in order to determine whether Seller meets PHH’s quality control standards.
• The Seller shall timely deliver to each applicant a completed Regulation Z disclosure statement, including all required TILA, RESPA and TRID disclosures, federally mandated fixed rate, or ARM disclosures and HUD booklets. The Seller shall be responsible for compliance with aggregate accounting requirements relating to escrow account statements and escrow accounting procedures mandated by RESPA. The Seller shall comply with Regulation Z concerning return of all moneys paid by the applicant to Seller should the applicant rescind, and Seller shall not seek reimbursement from PHH for such refund.
• The Seller shall deliver evidence, in a form satisfactory to PHH, of compliance with all federal, state and local laws and regulations, including, but not limited to, copies of any notice or disclosure form furnished to an applicant.
• The Seller shall utilize only licensed real estate appraisers that meet the requirements set forth in PHH’s underwriting guidelines, and whose approval and appointment is made in compliance with regulations and standards contained in the Financial Institutions Reform Recovery and Enforcement Act or, in the case of FHA Loans, USDA Loans or VA Loans by appraisers approved by FHA, USDA, or VA, respectively.
• At all times during the term of the Seller Agreement, the Seller shall maintain a complete set of files and records of all business activities and operations conducted by the Seller in its capacity as a loan seller of PHH. Such files and records shall be maintained in a neat, orderly and organized manner. For a period of not less than 36 months from and after the date of termination or expiration of the Seller Agreement, the Seller shall continue to maintain all such files and records at a reasonably accessible location. Alternatively, the Seller may deliver to PHH all such files and records. At all times during the term of the Seller Agreement and at all times during the 36 month period following expiration or termination of the Seller Agreement, PHH, its duly authorized agents, representative and employees, any necessary party involved in any public offering (such as Rating Agencies) and federal and state regulatory agencies which supervise PHH shall have a right, upon reasonable notice, to audit, inspect and copy any of the foregoing records, reports, files, and related materials of the Seller, and the Seller shall cooperate and assist any such audit or inspection.
• The Seller shall conduct periodic quality and compliance control reviews of its origination operations and systems that verify, on a regular basis, the existence, methodology and processes for generation, production, delivery and accuracy of the legal documents, credit documents, property appraisals, and underwriting decisions. The Seller’s quality and compliance control review program shall include evaluation and monitoring of the overall quality of the Seller’s loan production. Upon request of PHH, the Seller shall provide copies of its reviews and findings to PHH. PHH shall have the right, in its sole discretion, to review any and all Credit Files or Loan Files relating to the loans and/or servicing rights related to loans to be sold or previously sold to PHH for quality control or other purposes. The Seller agrees to make such files available to PHH for inspection upon receipt of five business days prior written notice.
• The fact that PHH or its designee has conducted or has failed to conduct any partial or complete examination of a loan, including review of the Credit File, Loan File, or any appraisal or other valuation data, and whether before or after sale of such loan to PHH, shall not affect PHH’s (or any of its successor’s) rights to demand repurchase, indemnification, substitution or other relief as provided herein. Any appraisal acknowledgement by PHH is only for the purpose of assisting the Seller in loan sale determinations, and does not constitute an opinion of value or statement indicating that the appraisal meets any related FHA, HUD or Uniform Standards of Professional Appraisal Practice guidelines, nor does it waive any rights or remedies PHH may have under the Seller Agreement with respect to insurability, valuation, indemnification, repurchase or otherwise. The Seller shall make PHH the loss payee of each mortgage guaranty insurance policy and hazard, wind and flood insurance policy. Ownership of, and title to, a loan will not be vested in PHH until such loan is accepted by PHH and the related purchase price is remitted to the Seller.
• To the extent the Seller services a loan after the related Closing Date, the Seller (or its designee, which designee shall be approved in writing by PHH) shall service the loan in conformance with all accepted servicing practices and applicable requirements until such time as the servicing of such loan is transferred to PHH or its designee. The Seller shall promptly follow PHH’s instructions regarding transferring any such servicing. If applicable, the Seller shall, at its expense, mail the approved form of notification to mortgagors under the loans of the transfer of the servicing rights and instruct the mortgagors to deliver all mortgage and related payments and all tax and insurance notices to PHH after the Closing Date, all in accordance with the applicable requirements and PHH hereby agree to comply with the confidentiality and privacy provisions set forth in this Guide.
• Confidential Information:
  • In General: Neither the Seller nor PHH shall make use of, disseminate or in any way disclose any confidential information of the other party or its affiliates, except as necessary to perform its obligations under the Seller Agreement or as may be required by applicable requirements or with the express written authorization of the disclosing party or its affiliates, and each shall keep confidential information confidential and will ensure that its affiliates, employees, agents, and representatives who have access to such confidential information comply with this non-disclosure obligation. Each party shall maintain appropriate physical, electronic, technical, and procedural safeguards to receive, store, dispose of (if applicable), and secure all confidential information to protect it from unauthorized access, use, disclosure, alteration, loss, and destruction, and to protect against any anticipated threats or hazards to the security or integrity of such records or information which could result in substantial harm or inconvenience to any customer of a party, including but not limited to any loan applicant or mortgagor. The safeguards used by each party to protect confidential information of the other party shall be no less than those used by such party to protect its own confidential information.
  • Privacy of Customer Information: Except as otherwise agreed by the Seller and PHH and permitted by the privacy requirements, each party shall use customer information of the other party only for the express purposes set forth in the Seller Agreement and disclose customer information of the other party to third persons only as necessary to implement the provisions hereof in a manner consistent with the privacy requirements. Each party shall maintain at all times a customer information security program. Each party shall assess, manage, and control risks relating to the security and confidentiality of all customer information, and shall implement the standards relating to such risks in the manner set forth in the privacy requirements. Each party shall comply with the privacy requirements applicable to such party. With respect to information that is non-public personal information (as defined in the Gramm-Leach- Bliley Financial Services Modernization Act of 1999, Pub. L. No. 106 -102, 113 Stat. 1338, and the regulations and guidance promulgated thereunder (GLBA)), the Seller shall, and covenants to provide evidence thereof at all times during the Seller Agreement, maintain processes and procedures to comply with all reuse, re-disclosure, or other customer information handling, processing, security, notification and protection requirements under GLBA, other applicable federal and state consumer privacy laws, rules, and regulations, and the applicable requirements. Further, the Seller shall ensure that it has developed, implemented and maintains effective information security policies and procedures that comply with the Interagency Guidelines Establishing Standards for Safeguarding Customer Information, Final Rule (12 CFR Part 30, Appendix B) and the Federal Trade Commission’s Standards for Safeguarding Customer Information (16 CFR Part 314) (collectively, the "Safeguarding Rules"), the applicable requirements and other applicable laws and regulations, and such policies and procedures include administrative, technical and physical safeguards designed to
    • ensure the security and confidentiality of confidential or proprietary information as may be provided to it by PHH hereunder;
    • protect against anticipated threats or hazards to the security or integrity of such confidential or proprietary information; and
    • protect against unauthorized access or use of such confidential or proprietary information.

• one or more sales of the loans as whole loan transfers (each, a “Whole Loan Transfer”); and/or
• one or more securitization transactions.

• to cooperate fully with PHH or an affiliate of PHH and any prospective purchaser with respect to any Whole Loan Transfer or Securitization Transaction, including but not limited to, all reasonable requests, due diligence procedures and disclosures, and with respect to the preparation (including, but not limited to, the endorsement, delivery, assignment, and execution) of the documents contained in the Loan File and other related documents;
• to deliver to PHH or an affiliate of PHH, or any prospective purchaser such additional loan information requested and to indemnify PHH, its affiliates or any prospective purchaser for such information at the time of such delivery to the extent such information is not true and correct;
• to execute all Reconstitution Agreements provided that each of the Seller and PHH or an affiliate of PHH is given an opportunity to review and reasonably negotiate in good faith the content of such documents not specifically referenced or provided for in this Guide;
• with respect to any Whole Loan Transfer or Securitization Transaction, the Seller shall make the representations and warranties regarding the Seller and the loans as of the date of such Whole Loan Transfer or Securitization Transaction, as applicable, modified to the extent necessary to accurately reflect the pool statistics of the loans as of the date of such Whole Loan Transfer or Securitization Transaction and supplemented by additional representations and warranties that are not unreasonable under the circumstances as of the date of such Whole Loan Transfer or Securitization Transaction to the extent that any events or circumstances, including changes in applicable law occurring subsequent to the related Closing Date, would render a related loan unmarketable to a material segment of the secondary mortgage or mortgage-backed securities market or make any representations or warranties required by any Rating Agency
• to deliver to PHH or an affiliate of PHH such information, reports, letters and certifications as are required and in the time frame and manner set forth in this section, and to indemnify the PHH and its affiliates as set forth in this section;
• to deliver to PHH or an affiliate of PHH for inclusion in any prospectus or other offering material (including any private offering document) such publicly available information regarding the Seller, its financial condition and its Loan delinquency, foreclosure and loss experience and any additional information reasonably requested by PHH or an affiliate of PHH, and to deliver to the PHH or an affiliate of PHH any similar nonpublic, unaudited financial information, in which case the PHH or an affiliate of PHH shall bear the cost of having such information audited by certified public accountants if the PHH or an affiliate of PHH desires such an audit, or as is otherwise reasonably requested by the PHH or an affiliate of PHH and which the Seller is capable of providing without unreasonable effort or expense, and to indemnify the PHH and its affiliates for material misstatements or omissions contained (i) in such information and (ii) on the Mortgage Loan Schedule;
• to deliver to PHH, and to any Person designated by PHH, such statements and audit letters of reputable, certified public accountants as are customarily delivered by originators such as Seller in connection with a Whole Loan Transfer or Securitization Transaction pertaining to Seller’s financial condition as shall be reasonably requested by PHH or an affiliate of PHH;
• to deliver to PHH, and to any person designated by PHH, such legal documents and opinions of counsel (which counsel shall be independent, outside counsel of the Seller) as are customarily delivered by originators and reasonably determined by PHH to be necessary in connection with any Whole Loan Transfer or Securitization Transaction, and such outside opinions of counsel for a Securitization Transaction to be in a form reasonably acceptable to PHH, with the cost of any such outside opinions of counsel that may be required, paid by PHH or an affiliate of PHH;
• in connection with each Whole Loan Transfer or Securitization Transaction, to agree to permit any prospective assignees of PHH who have entered into a commitment to purchase any of the loans or any independent third-parties selected by PHH to conduct Pre-Securitization TPR, Post-Securitization TPR (or any other similar pre-securitization or post-securitization review as may be required by any Rating Agency), to assess loan information and review the Seller’s servicing and origination operations, upon reasonable prior notice to the Seller, the Seller shall cooperate with such reviews and underwriting to the extent such prospective assignees or independent third-parties request information and documents (in electronic form or otherwise) that are reasonably available and provided such parties are told the confidential nature of such information. Subject to any applicable law, the Seller shall make the servicing files related to the loans held by the Seller available at the Seller’s principal operations center for review by any such prospective assignees or independent third-party during normal business hours upon reasonable prior notice to the Seller (in no event fewer than two (2) Business Days’ prior notice);
• to agree and consent that all information provided by the Seller to any Rating Agency for the purpose of determining and which is used in connection with the initial rating of a rated securitization including the loans, or for undertaking credit rating surveillance on such securitization, may be posted on a website which complies with the requirements of Rule 17g-5 of the Exchange Act on request of PHH or an affiliate of PHH. Upon request of PHH or an affiliate of PHH, the Seller shall provide all such information in electronic form as needed to effect such posting. To the extent any Rating Agency conducts an originator review or other review of the operations of the Seller which may be used in connection with the initial rating of a securitization or the surveillance thereof, on request of PHH or an affiliate of PHH, the Seller shall provide to PHH or an affiliate of PHH in electronic form all information that was provided to the Rating Agency in connection with such review;
• to indemnify the Purchaser and its agents, managers and trustees, each affiliate designated by the Purchaser, each person who controls the Purchaser or such affiliate and hold each of them harmless from and against any losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related costs, judgments, and any other costs, fees and expenses that each of them may sustain in any way related to (A) any untrue statement of a material fact contained or alleged to be contained in any information, report, certification, data, accountants’ letter or other material provided by or on behalf of the Seller, or provided under the Seller Agreement or this Guide by or on behalf of any third-party originator, regarding the Seller, the loans or the underwriting standards which is set forth in any offering document prepared in connection with any Securitization Transaction (collectively, the “Company Information”), or (B) the omission or alleged omission to state in the Company Information a material fact required to be stated in the Company Information or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, by way of clarification, that clause (B) of this paragraph shall be construed solely by reference to the Company Information and not to any other information communicated in connection with a sale or purchase of securities, without regard to whether the Company Information or any portion thereof is presented together with or separately from such other information, or (C) the failure by the Seller to make any required filings or provide the information needed by Purchaser for any required filings under the Exchange Act or under any other applicable securities law and regulation;
• to indemnify the Purchaser and its agents, managers and trustees, each affiliate designated by the Purchaser, each person who controls the Purchaser or such affiliate and hold each of them harmless from and against any losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related costs, judgments, and any other costs, fees and expenses that each of them may sustain in any way related to (A) any untrue statement of a material fact contained or alleged to be contained in any information, report, certification, data, accountants’ letter or other material provided by or on behalf of the Seller (including by the Purchaser), or provided under the Seller Agreement or this Guide by or on behalf of any third-party originator, regarding the Seller, the loans or the underwriting standards which is provided to any Rating Agency in connection with any initial ratings issued in connection with any securitization or the surveillance of such ratings (collectively, the “Rating Agency Disclosure”) or (B) the omission or alleged omission to state in the Rating Agency Disclosure a material fact required to be stated in the Rating Agency Disclosure or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and
• to (x) represent and warrant to each Rating Agency providing a rating in a separate writing that (i) the Seller shall promptly provide to each Rating Agency all information requested by each Rating Agency in accordance with its published ratings criteria, (ii) all information provided to the Rating Agency contains no untrue statement of a material fact and does not omit a material fact necessary in order to make such information, in light of the circumstances in which it was provided, not misleading, and (iii) make any other representations or warranties or provide any other information required by any Rating Agency and (y) indemnify any such Rating Agency that provides a rating and each of its affiliates, directors, officers and employees for any losses, damages, liabilities, judgments, costs, charges and expenses (including without limitation attorneys’ fees) of whatever nature (whether foreseeable or not) arising from or in connection with the breach of any of the representations and warranties set forth in clause (x) herein, including resulting from or relating to the use by the Rating Agency of or reliance by the Rating Agency on information provided to it by the Seller.

• Mini Bulk Tapes: Approved Sellers can submit bulk tapes to Ratelock@PHHMortgage.com . Sellers in return will receive a best ex per each eligible loan. All submissions must be sent to the Rate Lock email address for execution by 4:00pm ET. Any bids sent after 4:00pm ET will be denied and requested to be submitted the following business day for the current price.
• Best Efforts Commitment: Approved Sellers can register and lock Loans via PHH Correspondent portal. All registrations and commitments are priced to PHH's posted Correspondent Rate Sheet Daily within PHH Correspondent portal. Pricing will be posted usually by 9:30am ET and remain valid until the earlier of 9PM ET or an intraday re-price. In the event of a re-price(s) the current active Rate Sheet will remain in effect until 9:00 PM ET.
• E-Mail: Ratelock@PHHMortgage.com

Seller should contact PHH Rate Lock Desk if the commitment confirmation terms appear incorrect. See the Communication Chart for contact information.

• Borrower SSN (and/or Co-Borrower)
• Borrower Last Name (and/or Co-Borrower)
• Borrower First Name (and/or Co-Borrower)
• Property Street Address
• Property State
•  Zip Code
• Product Code (ID)
• Note Rate
• Loan Amount
• Loan Term (10-30 year terms in increments of 12 months)
• FICO (optional for some products, but recommended for all)
• Loan Purpose
• Occupancy
• Doc Type (Processing Style)
• Property Type (may require additional info such as Condo, # Units, etc.)
• # of Units
• One of the following: Sales Price, Appraised Value, or LTV
• Escrows – Yes or No

• The Seller must update all state licensing information by emailing state licensing and exemption information directly to counterpartyreview@phhmortgage.com .
• After this information is received and the system has been updated to reflect the appropriate approval, the Seller must contact the Rate Lock Desk to complete the registration.
• Rates effective on the original request date will not be honored.

• Loan Purpose
• Loan Type
• Occupancy Type
• Loan Program/Product
• Loan Amount
• Down payment Amount
• Purchase Price
• Interest Only Months, if applicable
• Number of Units
• Property Type
• FICO Scores (including credit score used for approval)
• Rate Lock Check Box/Lock Date
• Interest Rate
• Lock Days
• Amortization Type
• Amortization Term
• LTV
• CLTV
• Appraised Value
• Lien Position

• Rate lock expired prior to loan closing and disbursing
• Delivery date expired prior to delivery of complete package
• Loan in suspense for more than 30 days
• Commitment cancelled/denied and new commitment requested
• Address changes
• Most product changes

• Missing/incomplete/incorrect Social Security numbers
• Missing/incomplete/incorrect property address
• Missing/incomplete/incorrect borrowers names
• No credit score is provided, but product requires it
• No DTI is provided, but product requires it
• Loan does not fit product guidelines
• Product code not provided
• Rate is not selected
• Rate Lock Window or Delivery Type is not selected
• Requested rate is not available
• Seller is not licensed in the state where property is located

• Flow Mandatory: Not Available
• Forward Mandatory Trades: Not Available
• Mini Bulk: Minimum of $1,000,000 in UPB required. The Seller will submit an approved bulk tape to Ratelock@PHHMortgage.com for live market pricing. All loans submitted must be Agency approved and comply with PHH guidelines.

• In the event that a duplicate lock is created, the loan will become subject to worst-case pricing.
• Only Sellers with select authorization authority will be permitted to lock into Mandatory Commitments.
• Seller may not assign or transfer a Mandatory Commitment, in whole or in part, without the prior express written consent of PHH.

Under a Best Efforts Commitment, the Seller can take a Best Efforts Commitment via PHH Correspondent portal. A Seller can access PHH Pricing by utilizing PHH's Get Pricing Scenario tool via PHH Correspondent portal. Due to potential market volatility, PHH reserves the right to re-price at any time. In the event of a Rate Sheet re-price, PHH may suspend pricing until a new Rate Sheet is posted to PHH Correspondent portal. If, at any time, a Seller is actively locking during a re-price, PHH will honor pricing from the current Rate Sheet timestamp. A Best Efforts Commitment that is not submitted and withdrawn will be cancelled without penalty provided the Loan did not close with the Seller. All Non-Delegated Loans will be locked under a Best Efforts Commitments.

The following additional rules apply to Best Efforts Commitments:

• In the event that a duplicate lock is created, the Loan will become subject to worst-case pricing.
• Only Sellers with the designated authority will be permitted to lock using Best Efforts.
• Seller may not assign or transfer a Best Efforts Commitment, in whole or in part, without the prior written consent of PHH.

Although the Seller is not required to deliver the Loan if the Loan closes with the Seller under a Best Efforts Commitment, PHH considers a Best Effort lock to be a mandatory commitment when the loan closes with the Seller and reserves the right to pair-off the commitment in the event a locked Best Effort loan that closes with the Seller is not purchased by PHH. PHH will track the percentage of the Seller's commitments that are not delivered for purchase or delivered for purchase and subsequently cancelled, withdrawn, denied or rejected (referred to as “fallout rate”). An above-target fallout rate may result in the suspension or loss of approval to sell Loans to PHH or an adjustment to pricing on future commitments.

• If the relock is requested more than 30 days after the commitment’s expiration or cancellation, whichever applies, the loan will be priced at current market. However, the loan will continue to be assessed any previously purchased lock extensions or other fees unless the loan has been expired or canceled for more than 120 consecutive days.
• PHH may deny the relock request at the original locked rate on an expired lock due to market illiquidity.
• Rates not listed on the current rate sheet are illiquid rates and Seller may not be able to relock them.
• Loans that are relocked must meet all current product eligibility guidelines.
• Loans that have expired and have been relocked more than once may be subject to additional fees or may become ineligible for relock.
• If a loan has been expired or cancelled for more than 120 consecutive days, the loan can be relocked at current market pricing with no market comparison and is no longer subject to the cost of previous extensions. In most cases, a new loan number will be assigned, and the old expired loan number will be withdrawn.

• PHH will relock loans up to a maximum of four times for no greater than a total of 60 days, never to exceed the original lock window.
• All relocks are subject to current PHH product eligibility guidelines. Loans not meeting current product guidelines will not be eligible for relock.
• Relock windows for Mandatory Commitments can only be taken in increments of 5, 10, 15 or 30 days, but may not be longer than the original lock window.

• Relocks are calculated on a worst-case pricing basis.

• For all Loans pooled or sold, 1.15% of the amount of the unpaid principal balance of the loan at the time of acquistion.
• For any loans not yet pooled or sold, the greater of (a) any premium paid in excess of par, or (b) 1.15% of the principal loan amount.

• The Seller breaches any representation, warranty, covenant or agreement regarding a loan.
• The Seller fails to provide all of the documentation required by PHH and/or fails to satisfy all other requirements of the Seller Agreement within 60 days following the Closing Date. Such date shall be extended to a date 90 days following the Closing Date for documents timely sent out for recording, but not yet returned due to delays solely within the applicable recording office.
• With regard to FHA Loans, VA Loans, or USDA Loans, the Seller fails to submit for FHA Mortgage Insurance Certificate (MIC) or VA Loan Guaranty Certificate (LGC) or USDA Loan Note Guarantee (LNG) within 60 days following the date of the Mortgage Note.
• With regard to FHA Loans, USDA Loans or VA loans, in the reasonable judgment of PHH, the related MIC, LNG or LGC cannot be obtained, or any required private mortgage insurance or guaranty, lapses, is rescinded, or a claim thereon is denied or not paid unless directly caused by the negligence of PHH.
• PHH repurchases any loan previously conveyed, transferred, or assigned by PHH to any third party due to defects which existed prior to, or arose as a result of an occurrence on or before the Closing Date, or any third-party investor refuses to purchase a loan due to defects which existed prior to or arose as a result of an occurrence on or before the Closing Date.
• The Loan File or Credit File contains any fraudulent document, or any misstatement or omission of material fact, regardless of whether such loan is delinquent.
• Any mortgagor under a loan is in default of any obligation to pay taxes and/or insurance in accordance with the applicable provisions of the underlying mortgage and such default occurs within 90 days of the related Closing Date.
• Any mortgagor under a loan files for protection, as a debtor, in any state or federal bankruptcy or insolvency proceeding within 90 days of the related Closing Date.
• For any loan incapable of being repurchased due to inclusion in a Ginnie Mae pool, the Seller agrees to comply with all Ginnie Mae requirements and procedures to remedy or address all issues related to such loan, including any required repurchase of such loan in accordance with Ginnie Mae requirements.
• Notwithstanding any applicable cure period or extension of time with respect to a deficiency in such Loan, if PHH is unable to sell such Loan into the secondary mortgage market that it wishes to sell because of any breach of the Seller Agreement by the Seller or fraud or misrepresentation in connection with any loan documentation, or any misleading, false or erroneous statements or information that is contained in any document submitted with or included as part of the loan documentation.
• Seller’s noncompliance with the requirements under this Guide or the Seller Agreement adversely affects the value of such Loan or PHH’s interest in such Loan.

Upon discovery of one or more deficiencies relating to a Loan, PHH will send an initial demand to the Seller via email setting forth such deficiency and indicating that a Loan requires repurchase. Seller will have 15 calendar days to cure the deficiencies relating to such Loan that are capable of cure within such 15 calendar day period; provided, however, that PHH may, in its sole discretion exercised in good faith, identify a shorter or longer period of time to cure based on the circumstances and any investor demand at the time. Prior to the expiration of the applicable cure period, the Seller may submit a letter requesting formal appeal relating to such Loan deficiencies. If the formal appeal is rejected by PHH, in its sole discretion exercised in good faith, the Seller may submit a letter requesting a second appeal within 10 calendar days of the rejection date of the first appeal request.

In the event that (1) the deficiencies are not cured or are not capable of cure within the applicable cure period set forth above or (2) if applicable, the second appeal is denied, the Seller shall pay the Repurchase Price, as set forth in an invoice provided to the Seller, within 10 calendar days of the invoice date. In the event the Seller does not pay the Repurchase Price within such 10 calendar day period, PHH may, at its option, exercise any of its set-off rights as set forth in this Guide, the Seller Agreement or otherwise until the Repurchase Price is received in full by PHH.

Loans which have been previously repurchased from or require indemnification of Fannie Mae, Freddie Mac, Ginnie Mae, FHA, USDA, or VA are ineligible for purchase by PHH. If the Seller seeks to cure a deficiency by refinancing a Loan in lieu of repurchasing the Loan, such refinanced Loan may be ineligible for purchase by PHH, in PHH’s sole discretion exercised in good faith.

The Repurchase Price for a Loan subject to a Repurchase by the Seller shall be calculated in accordance with and include the following:

1. The Purchase Price, Premium and SRP: The Purchase Price, including the SRP [or the greater of any premium paid in excess of par or 100 basis points of the purchased Loan amount if the Loan is not eligible for sale to an Agency] paid to the Seller at the time of purchase, applied to the outstanding principal balance due and owing on the Loan as of the date of Repurchase; plus
2. Modified Mortgage Loan Amount: To the extent PHH, as part of its loss mitigation efforts, enters into an agreement modifying the terms of the Loan (a “Modification Agreement”) with a Mortgagor suffering an involuntary inability to pay its Mortgage under the original terms of the Mortgage Note, the Repurchase Price will be calculated based on the outstanding principal balance based on the modified Loan amount, which may increase the amount of the unpaid principal balance due to capitalization of interest, escrow amounts and/or other advance amounts; plus
3. Escrow and Advances: Any servicing or escrow advances made by PHH with regard to such Loan that remain unreimbursed as of the date of Repurchase; plus
4. Expenses: Any and all documentary stamp taxes, recording fees, transfer taxes, and all other expenses payable in connection with any such Repurchase, including, without limitation, any loss relating to the Loan, all costs, expenses and liabilities incurred by PHH in connection with the repurchase of such Loan from any third party, reasonable attorneys' fees, costs and expenses incurred by PHH, and any other loss or expense in connection with property preservation, costs of property inspections, and costs of broker price opinions; plus
5. Interest, Penalties, and Fees: All accrued but unpaid interest from the last date through which interest has been paid through and including the last day of the month in which the Seller repurchases the Loan and the Repurchase Price is received in full by PHH together with; plus any and all penalties and fees charged to PHH by any subservicer of such Loan, including, but not limited to, late fees and restoration fees; plus, any late fees that PHH may charge, in its sole discretion, in connection with PHH’s costs to carry the Loan on its books as a result of the failure of the Seller to timely pay the Repurchase Price.

• Seller must provide an AUS result with a decision to "Refer due to credit" and;
• Seller must satisfy all applicable Agency requirements relating to non-traditional credit.

FHA Loans: Principal and Authorized Agent sponsorship is available to approved Sellers. Sellers must request an Authorized Agent sponsorship from PHH at time of approval.

VA Loans: VA Non-Supervised Sponsored Agent sponsorship is available to approved Sellers. Sellers must request a Non-Supervised Sponsored Agent sponsorship from PHH at time of approval.

FHA/VA Loans: The Seller is responsible for complying with all insurance and fee payment requirements, including, without limitations, remitting the upfront MIP/VAFF/ Loan Guarantee fee and insuring and providing evidence of insurance and payment at time of submission for purchase. Any Seller unable to satisfy the insuring process must contact its Account Executive immediately to discuss possible alternatives.

Credit exception requests may be submitted to

PHHCorrespondentScenarioHelpDesk@phhmortgage.com for credit exceptions prior to Loan submission for underwriting. Each request must include the completed exception form and all applicable supporting documentation. The exception form can be located on TPO Connect or the PHH Correspondent portal.

PHH will respond to an exception request in writing. The exception form must be uploaded with the Credit File at the time of submission to PHH for underwriting.

PHH reserves the right to rescind any exception approval if PHH determines, in its sole discretion, at the time of submission of the Loan for underwriting or purchase that the Loan or Credit File does not match exception details set forth in the exception form.

PHH offers Non-Delegated Sellers access to the Scenario Help Desk (SHD) to review underwriting scenarios prior to a Seller submitting a Credit File to PHH for underwriting. SHD will review parameters of a Loan, but the final underwriting decision will be based on all aspects of the Loan and the Credit File.

To submit an underwriting scenario, a Seller may complete the PHH Scenario Request form available on the PHH Correspondent portal or email PHHCorrespondentScenarioHelpDesk@phhmortgage.com. The preferred method of communication is via email. SHD makes every effort respond to the request via email within 24-48 hours during business days, subject to request volume and complexity of the request.

SHD recommendations are not underwriting approval. Any changes to the Loan or Credit File prior to submission to PHH for underwriting will be reviewed by the PHH underwriter and could result in an underwriting decision that differs from the SHD recommendation previously provided.

Once a Loan is submitted to PHH for underwriting, a Seller should contact its designated Correspondent Specialist with any questions or notification of any changes to the Loan or Credit File.

All Loans submitted to PHH for underwriting must be transferred into a FINAL status in FNMA desktop originator (DO) or in a FINAL ASSIGNMENT status in FHLMC Loan Prospector Advisor (LPA).

DO sponsorship is available to approved Sellers. Lenders need to request approval via FNMA Desktop Originator Portal A Seller will be removed from sponsorship upon deactivation from approved status. Upon delivery, the final findings must match PHH approval. If any changes occur, the Seller is required to submit such changes to PHH underwriting prior to closing.

All Loans submitted to PHH for underwriting review must meet all PHH and Agency guidelines and comply with all applicable local, state and federal laws and regulations. Sellers are responsible to ensure all Loans are in compliance with Chapter 12 of this Guide. The following rules apply to Loans submitted to PHH for underwriting review:

All Loans must be registered in accordance with this Guide with PHH prior to submission.

All Loans must have a Universal Loan Identifier "ULI" at time of submission. Credit Files submitted to PHH for underwriting review may be uploaded via the PHH Correspondent portal.

All Loans must include an acceptable compliance report such as a Mavent or Compliance Ease or other such report PHH deems acceptable. Copies of loan document audit do not constitute a compliance report. Please see Chapter 12 for Compliance Requirements.

All closing conditions must be submitted and cleared prior to closing of the Loan. Loans submitted for purchase by PHH without clearing all closing conditions may be rejected for purchase.

Loan changes required to be made pursuant to the PHH final approval must be reflected on the final application signed by the borrower at closing.

Loans closed that do not comply with the terms, conditions, and requirements listed on the PHH final approval will be re-evaluated by the PHH underwriter prior to purchase by PHH. Loans submitted for purchase may be rejected if updated approval cannot be provided.

The Seller is responsible for adhering to PHH's disaster area policy including providing a disaster inspection prior to Loan submission to PHH for purchase as set forth in Section 8.38 of this Guide.

For the list of required documents and the instructions on how to upload and transmit a Credit File for underwriting review, please access the PHH Portal Guide.

Any Loan secured by a condominium in a condo project must approved by PHH and/or FHA. Credit Files for condo loans submitted for PHH underwriting review must contain all applicable condo project documentation. PHH will review eligible condo projects for Non-Delegated Sellers. Every condo loan/condo project must meet general eligibility standards of each applicable Agency and any PHH guidelines regardless of the review method.

Type of condo loan reviews:

• Full Review: Seller must submit 5-page full form along with condo project documentation (including: covenants, conditions and restrictions; bylaws; articles of incorporation, financial statements, budget documents, insurance declaration page, HO-6 condo insurance policy, and a recent condo reserve study).
• Limited Review: Seller must 4-page short form questionnaire and all required documentation per AUS approval including Master Insurance Policy and HO-6 condo insurance policy currently in effect.
• Waived Review (Fannie Mae Only): Seller must submit Master Insurance Policy and HO-6 condo insurance policy currently in effect.
• Fannie Mae PERS Approval: Seller must provide approval information printout from Fannie Mae if the condo project has been approved by Fannie Mae.
• Project types not eligible for review:
• Coop Projects
• New or newly converted Condo projects
• Manufactured Home Condo projects