Pro Hac Vice admission sought - Got a Class Action?gotaclassaction.com/.../2013/03/Nationstar-3-19-13.pdf · Nationstar Mortgage LLC is a Delaware limited liability company with its

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CLASS ACTION COMPLAINT Case No.

Sean P. Reis (SBN 184044) EDELSON MCGUIRE, LLP 30021 Tomas Street, Suite 300 Rancho Santa Margarita, California 92688 Telephone: (949) 459-2124 Facsimile: (949) 459-2123 Email: [email protected] Steven L. Woodrow (Pro Hac Vice admission sought) Megan Lindsey (Pro Hac Vice admission sought) EDELSON MCGUIRE, LLC 999 West 18th Street, Suite 3000 Denver, Colorado 80202 Telephone: (303) 357-4878 Facsimile: (312) 589-6378 Email: [email protected] Email: [email protected] Counsel for Plaintiff DENNIS BURTON

UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

DENNIS BURTON, on behalf of himself and all others similarly situated,

Plaintiff,

v. NATIONSTAR MORTGAGE LLC, a Delaware limited liability company,

Defendant.

No: CLASS ACTION COMPLAINT FOR DAMAGES AND INJUNCTIVE RELIEF Jury trial demanded

Case 1:13-at-00123 Document 1 Filed 03/04/13 Page 1 of 21

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CLASS ACTION COMPLAINT CASE NO.

1

NATURE OF THE ACTION

1. Plaintiff Dennis Burton (“Burton” or “Plaintiff”) brings this suit on behalf of

himself and a class of similarly situated homeowners across the nation (the “Class”) to challenge

Defendant Nationstar Mortgage, LLC’s (“Defendant” or “Nationstar”) intentional and systematic

failure to provide permanent loan modifications to borrowers who signed Permanent Modification

Agreements (“PMAs”) under the Home Affordable Modification Program (“HAMP”).

2. In doing so, Nationstar has serially failed to honor its express and implied

contractual obligations under its PMAs, has made repeated misrepresentations of material fact, and

has engaged in business practices that are deceptive, immoral, unscrupulous, unfair, and

oppressive under California law. (See Burton Trial Period Plan Agreement (“TPP Agreement”)

and PMA, attached as Group Exhibit A.)

3. Under the Troubled Asset Relief Program (“TARP”), also known as the taxpayer

bailout, the United States Government provided the nation’s largest financial institutions with

nearly $700 billion in funds to address what was widely accepted as an unprecedented financial

crisis. 12 U.S.C. § 5211.

4. A key feature of TARP is the Making Home Affordable Program, of which the

HAMP is a major component. Under the HAMP, servicers like Nationstar and other major lenders

receive incentive payments for providing mortgage loan modifications to eligible borrowers such

as Plaintiff Burton and the putative Class.

5. In or around May 2009, Nationstar signed a contract with the U.S. Department of

the Treasury, through its agent, Fannie Mae, agreeing to participate in the HAMP as an approved

HAMP servicer. Nationstar thereafter executed an amended Servicer Participation Agreement

(“SPA”) in or around September 2010. (See Amended SPA, attached as Exhibit B.)

6. As a HAMP servicer, Nationstar entered into written PMAs for modifications with

Plaintiff and other eligible Nationstar borrowers. These PMAs, which were form contracts,

expressly required Nationstar to permanently modify the borrower’s loan pursuant to the terms of

the PMA.


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7. Plaintiff and the members of the putative Class complied with their obligations

under their TPP Agreements and PMAs by executing and submitting all required documentation,

answering all questions truthfully, keeping their representations true and accurate, and making

their required trial period payments. Despite Plaintiff’s and the other Class Members’ full

performance, Nationstar has ignored its obligations under their PMAs and the HAMP by refusing

to permanently modify their loans.

8. Nationstar’s failure to permanently modify its borrowers’ loans is no accident. To

the contrary, Nationstar has knowingly established a system designed to wrongfully deprive its

eligible HAMP borrowers of an opportunity to modify their mortgages, pay their loans, and save

their houses from foreclosure. Nationstar’s actions, which serve only its interest in extracting as

much money as possible from borrowers it deems are at risk of default, thwart the very purpose of

HAMP, constitute express and implied breaches of its various contracts, and amount to immoral,

unlawful, and unfair business practices under California’s Consumer Legal Remedies Act

(“CLRA”) and Unfair Competition Law (“UCL”).

JURISDICTION

9. Jurisdiction is proper pursuant to the Class Action Fairness Act, 28 U.S.C.

§ 1332(d)(2). This claim is brought as a putative class action consisting of over 100 class members

in which the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest

and costs, and at least one member of the class of plaintiffs is a citizen of a State different from the

Defendant.

10. Venue is proper in this Court pursuant to 28 U.S.C. § 1391(b) as unlawful practices

are alleged to have been committed in this District, Defendant regularly conducts business in this

District, and the property securing the loan forming the subject of the Parties’ dispute is located in

Kern County, which is in this District. This Court has supplemental subject-matter jurisdiction

over any ancillary or pendent state law claims under 28 U.S.C. § 1367.

PARTIES

11. Plaintiff Burton is a natural person and is now a citizen of the State of Colorado.

Plaintiff Burton previously resided on Paulina Street in Bakersfield, California, and his home


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mortgage is one of the loans at issue in this lawsuit. At all times relevant, Burton was qualified and

eligible to participate in the HAMP program under all applicable directives and guidelines.

12. Nationstar Mortgage LLC is a Delaware limited liability company with its principal

place of business at 350 Highland Drive, Lewisville, Texas 75067.

FACTUAL BACKGROUND

Congressional Response to National Foreclosure Crisis

13. The United States has faced a foreclosure crisis over the past several years. To stem

the tide early on, on October 3, 2008, Congress passed the Emergency Economic Stabilization Act

of 2008 and, on February 17, 2009, Congress amended the statute by passing the American

Recovery and Reinvestment Act of 2009 (collectively the “Act”), 12 U.S.C. § 5201 et. seq. (2009).

The purpose of the Act is to grant the Secretary of the Treasury the authority to restore liquidity

and stability to the financial system and ensure that such authority is used in a manner that

“protects home values” and “preserves homeownership.” 12 U.S.C. § 5201.

14. The Act granted the Secretary of the Treasury the authority to establish TARP. 12

U.S.C. § 5211. Under TARP, the Secretary was empowered to purchase or make commitments to

purchase troubled assets from financial institutions. Id. In exercising its authority to administer

TARP, the Act mandates that the Secretary “shall” take into consideration the “need to help

families keep their homes and to stabilize communities.” 12 U.S.C. § 5213(3). The Act further

mandates, with regard to any assets acquired by the Secretary that are backed by residential real

estate, that the Secretary “shall implement a plan that seeks to maximize assistance for

homeowners” and that uses the Secretary’s authority over servicers to encourage them to take

advantage of programs to “minimize foreclosures.” 12 U.S.C. § 5219. The Act grants authority to

the Secretary of the Treasury to use credit enhancement and loan guarantees to “facilitate loan

modifications to prevent avoidable foreclosures” and imposes parallel mandates to implement

plans to maximize assistance to homeowners and minimize foreclosures. 12 U.S.C § 5220.

15. On February 18, 2009, acting pursuant to their authority under the Act, the Treasury

Secretary and the Director of the Federal Housing Finance Agency announced the HAMP. Under

the HAMP, the federal government incentivizes participating servicers to enter into agreements


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with struggling homeowners that will make adjustments to existing mortgage obligations in order

to make the monthly payments more affordable. Servicers receive $1,000.00 for each HAMP

modification.

Servicer Participation in the HAMP

16. The industry entities that perform the actual interface with borrowers—including

such tasks as payment processing, escrow maintenance, loss mitigation and foreclosure—are

known as “servicers.” Servicers typically act as the agents of the entities that hold mortgage loans.

Nationstar is a servicer

17. To participate in HAMP, a servicer must execute an SPA with the federal

government. In or around May 2009, representative of Nationstar executed an SPA, thereby

making Nationstar a participating servicer in the HAMP. In September 2010, Nationstar executed

an amended SPA. (See Ex. B.)

18. The SPA and amended SPA executed by Nationstar incorporate all “guidelines,”

“procedures,” and “supplemental documentation, instructions, bulletins, frequently asked

questions, letters, directives, or other communications” issued by the Treasury, Fannie Mae or

Freddie Mac, in connection with the duties of Participating Servicers. The SPA and amended SPA

mandate that a Participating Servicer “shall perform” the activities described in the HAMP

Documentation “for all mortgage loans it services.”

19. The HAMP Documentation requires Participating Servicers to evaluate all loans

that are delinquent 60 days or greater for HAMP modifications. In addition, if a borrower contacts

a Participating Servicer regarding a HAMP modification, the Participating Servicer must collect

income and hardship information to determine if the HAMP is appropriate for the borrower.

TPP Agreements

20. A HAMP Modification consists of two stages. First, a Participating Servicer is

required to gather a borrower’s financial and other relevant information and, if the borrower

qualifies, offer the borrower a TPP Agreement. Nationstar’s form TPP Agreements require

borrowers to make certain representations, provide relevant information, and make trial period


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payments at a revised rate designed to keep the borrower in his or her home. (See, e.g., Burton

TPP Agreement, Grp. Ex. A.)

21. Nationstar’s TPP Agreements provide that Nationstar will extend offers for

permanent modification to those homeowners who execute the TPP Agreement and fulfill the

documentation and payment requirements. (Id.) If a homeowner executes the TPP Agreement1,

complies with all documentation and representation requirements, and makes all of the trial period

payments on time, the second stage of the HAMP process is triggered in which Nationstar is

required to offer the home owner a PMA.

Upon Completion of the Trial, the Borrower executes a PMA

22. Once the trial is complete, the servicer is to provide a PMA for the borrower’s

signature. Once signed, the Participating Servicer signs and causes the loan to be permanently

modified. This case challenges Nationstar’s serial failure to honor its PMAs. Rather than modify

the loans of borrowers with signed PMAs, Nationstar has deprived homeowners of their

contractual rights and improperly foreclosed on borrowers who otherwise should have been able to

save their homes. Nationstar’s conduct is especially egregious because Nationstar refuses to

correct known errors, misrepresents to borrowers that they must be in default to participate in the

HAMP, improperly reviews borrowers after their Modification Effective Dates, fails to provide

approvals and denials within reasonable periods of time, fails to adequately hire and train staff to

effectuate loan modifications, routinely loses borrower HAMP applications and related paperwork,

and otherwise routinely disregards the HAMP directives and guidelines. This leads to arbitrary and

capricious denials of HAMP applications and refusals to permanently modify loans that—but for

Nationstar’s misconduct—would have, could have, and should have been modified.

1 On October 8, 2009, the HAMP Supplemental Directive 09-07 adopted the new form of the TPP Agreement that no longer required a borrower’s signature. See S.D. 09-07, available at https://www.hmpadmin.com//portal/programs/docs/hamp_servicer/sd0907.pdf, last visited February 21, 2013.


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FACTS RELATING TO NAMED PLAINTIFF BURTON

23. Burton and Nationstar entered into a HAMP TPP Agreement that was signed by

Burton on April 30, 2009, and was thereafter signed by a representative of Nationstar. The TPP

Agreement specifically states:

I understand that after I sign and return two copies of the Plan to the Lender, the Lender will send me a signed copy of this Plan if I qualify for the Offer or will send me written notice that I do not qualify for the Offer. This Plan will not take effect unless and until both I and the Lender sign it and Lender provides me with a copy of this Plan with the Lender’s signature.

24. The TPP Agreement bears a “Trial Period Plan Effective Date” of May 6, 2009.

25. Nationstar sent Burton a signed copy of the TPP Agreement and did not send him

notice that he did not qualify.

26. Burton timely made each of the $1,921.58 monthly trial payments due to Nationstar

on May 6, 2009, June 1, 2009, and July 1, 2009.

27. Thereafter, Nationstar sent Burton a HAMP PMA. Burton executed the PMA

promptly on August 25, 2009 and returned it to Nationstar. Nationstar, through one of its

representatives, countersigned the PMA on or about October 9, 2009, and sent the signed PMA

back to Burton.

28. Burton then waited for Nationstar to record and otherwise put his PMA into effect

as its terms required. Burton telephoned Nationstar repeatedly, and was told that all the paperwork

had been received and that Nationstar simply had to “book” the modification. The representative

instructed Burton to keep paying the amount set forth in the PMA, or $1,915.20.

29. Burton continued to pay the $1,915.20 set forth in the PMA. He telephoned and

spoke with Nationstar several times each week inquiring about his permanent modification. Each

time, Mr. Burton was assured that the permanent modification was simply waiting to be “booked”

and that his loan would be modified soon. Burton was continuously told to keep making his

reduced payments as set forth in the PMA, which he did. During this time, Burton received a

Notice of Trustee’s sale indicating the property had been sold. When Burton called Nationstar,

they assured him this was not an actual foreclosure and again, that the permanent modification

simply needed to be “booked.”


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30. After several months, and notwithstanding Burton’s compliance with the TPP

Agreement and PMA, and despite Nationstar’s execution of all documents and acceptance of all

payments thereunder from Burton, Nationstar refused to honor the PMA by modifying Burton’s

loan documents.

31. Instead of honoring the TPP Agreement and PMA, in a letter dated March 7, 2010,

Nationstar indicated that it was terminating the PMA and dropping Burton from the HAMP

because, supposedly, his property was not “owner occupied,” and that it was proceeding with the

foreclosure. At that time, Burton’s wife and seven children were residing full time at the

Bakersfield property. Burton was temporarily working in Colorado and would return periodically

to California and stay at the Bakersfield property when he visited. Burton took such employment

when it became evident that Nationstar was defaulting on the PMA and Burton would need

additional income to save his home. That the property was supposedly not “owner occupied” was

incorrect and was merely used by Nationstar as a pretext for not honoring Burton’s PMA, which

had been completed five months earlier. Nationstar had no such authority to re-evaluate Burton’s

eligibility in March 2010, several months after his PMA’s Modification Effective Date.

33. Despite repeated attempts to explain his situation to Nationstar, the Servicer refused

to honor Burton’s PMA by modifying his loan. Instead, Nationstar caused a foreclosure of its lien

on the Bakersfield property and threw Burton, his wife, and their seven children out of their home,

forcing them to find alternative living arrangements. Nationstar either still holds title to the

Bakersfield property or sold it to a new buyer.

34. On January 31, 2013, through his attorneys, Burton sent a certified letter, return

receipt requested, to Nationstar’s California address (as well as its Texas headquarters) asking the

company to rectify its failure to honor Burton’s TPP Agreement and PMA by permanently

modifying his mortgage. The letter further asked that Nationstar demonstrate that Burton’s

situation is unique in light of numerous public complaints about the company’s loan modification

and mortgage servicing operations. No response to the letter was received by Burton or his

counsel.


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CLASS ALLEGATIONS

36. Plaintiff repeats and re-alleges every allegation above as if set forth herein in full.

This class action is brought by Plaintiff on behalf of a nationwide class defined as follows: All homeowners nationwide who had executed permanent modification agreements (“PMAs”) with Nationstar from January 2008 through the present whose PMA Nationstar refused to honor by permanently modifying the borrowers’ loans.

Excluded from the Class are: (1) any Judge or Magistrate presiding over this action and

members of their families; (2) Defendant, Defendant’s subsidiaries, parents, successors,

predecessors, and any entity in which the Defendant or their parents have a controlling interest and

their current or former, officers and directors; (3) persons who properly execute and file a timely

request for exclusion from the Class; and (4) the legal representatives, successors or assigns of any

such excluded persons. Plaintiff anticipates that amending the Class Definition may become

necessary following discovery.

37. Plaintiff sues on his own behalf and on behalf of the above-defined Class under

Rule 23(a) and (b) of the Federal Rules of Civil Procedure.

38. Plaintiff does not know the exact size or identities of the members of the proposed

Class, since such information is in the exclusive control of Defendant. Prior to filing this lawsuit,

Plaintiff sent a letter via certified mail to Defendant asking for any information Nationstar showing

that its failure to modify Burton’s loan (even though he had a signed PMA) was a “one off” as

opposed to a larger problem. Plaintiff’s letter explained that numerous complaints existed online

regarding the company’s mortgage servicing activities. Nationstar refused to provide any

documents indicating that, unlike with Burton’s loan, it properly and appropriately “booked” or

otherwise effectuated and/or caused the loans of its other borrowers with signed PMAs to be

permanently modified.

39. Plaintiff believes that the Class encompasses hundreds of individuals whose

identities can be readily determined from Defendant’s books and records. Therefore, the proposed

Class is so numerous that joinder of all members is impracticable.

40. Based on the size of the modifications at issue, Plaintiff believes the amount in

controversy exceeds $5 million. All members of the Class have been subject to and affected by the


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same conduct. The claims are based on form contracts and uniform loan modification processing

requirements. There are questions of law and fact that are common to the Class and that are subject

to common proof, and predominate over any questions affecting only individual members of the

Class. These questions include, but are not limited to the following: a. Whether Nationstar’s signed PMAs with its customers obligated it to permanently modify those customers’ loans; b. Whether Nationstar breached express and implied terms of its signed PMA with Burton and its other customers by failing to permanently modify their loans; c. Whether Nationstar falsely represented to Burton and the other Class Members that it would permanently modify their loans; d. Whether Burton and the Class Members reasonably relied on Nationstar’s misrepresentations that it would permanently modify their loans to their detriment; e. Whether Burton and the Class Members conferred benefits on Nationstar, or whether Nationstar retains benefits under circumstances where it would be inequitable to allow Nationstar to keep retaining such benefits; f. Whether Nationstar violated the Equal Credit Opportunity Act with respect to Burton and the Class by failing to provide timely modification or denial decisions with respect to their HAMP modifications; g. Whether Nationstar wrongfully foreclosed on Burton and the other Class Members; h. Whether Burton and the other Class Members have suffered damages; and i. Whether Nationstar’s conduct with respect to Burton and the other Class Members can be enjoined as to all of them such that injunctive relief and corresponding declaratory relief are appropriate.

41. Plaintiff’s claims are typical of the claims of the Class and do not conflict with the

interests of any other members of the Class in that both the Plaintiff and the other members of the

Class were subject to the same conduct, signed substantially the same agreements, and were met

with the same refusal to permanently modify their loans.

42. Plaintiff will fairly and adequately represent the interests of the Class, is committed

to the vigorous prosecution of the claims, and has retained attorneys who are qualified to pursue

this litigation and have experience in class actions and HAMP litigation specifically.


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43. This putative class action meets both the requirements of Fed. R. Civ. P. 23(b)(2)

and Fed. R. Civ. P. 23(b)(3).

44. The Defendant has acted or refused to act on grounds that apply generally to the

Class so that final injunctive relief or corresponding declaratory relief is appropriate with respect

to the Class as a whole.

45. Common issues predominate and are central to the litigation over any perceived

individual issues. A class action is superior to other methods for the fast and efficient adjudication

of this controversy. A class action regarding the issues in this case does not create any problems of

manageability. COUNT I

Breach of Contract (On behalf of Plaintiff Individually and the Class)

46. Plaintiff re-alleges and incorporates the above allegations as if set forth fully herein.

47. Nationstar’s signed TPP Agreement is an enforceable contract requiring Nationstar

to provide Burton an offer to permanently modify his loan, and the signed PMA is an enforceable

contract for a permanent loan modification. Both contracts contain an offer by Nationstar in

exchange for monthly trial payments or permanent modification payments. Burton accepted both

agreements by signing and returning the agreements to Nationstar. He fulfilled his obligations

under the contracts by keeping his representations true, making his trial payments, and providing

several other forms of consideration, including additional exchanged promises and the foregoing

of other opportunities.

Breach of promise to permanently modify loans

48. Nationstar’s signed PMA with Burton specifically stated that, “If my

representations in Section 1 continue to be true in all material respects, then this Home Affordable

Modification Agreement (“Agreement”) will, as set forth in Section 3, amend and supplement (1)

the Mortgage on the Property, and (2) the Note secured by the mortgage.” (See Preamble to PMA,

Ex. A.)

49. Nationstar’s signed PMA with Burton further stated that, “If my representations in

Section 1 continue to be true in all material respects and all preconditions to the modification set


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forth in Section 2 have been met, the Loan Documents will automatically become modified on

August 1, 2009 (the “Modification Effective Date”) and all unpaid late charges that remain unpaid

will be waived. The Loan Documents will be modified and the first modified payment will be due

on September 1, 2009.” (See PMA ¶ 3, Ex. A.)

50. Nationstar materially breached both of these provisions by failing to permanently

modify Burton’s and the other Class Members’ loans and by instead foreclosing on them or

wrongfully dispossessing them of their homes, or churning and steering the customers into less

favorable foreclosure alternatives.

51. As a result of these breaches, Burton and the members of the Class have suffered

damages to be proven at trial, including but not limited to being: a. Denied the value of the offer for permanent modification they should’ve received in the form of lower monthly payments (in Burton’s case, an approximate $300 - $500 monthly savings for the remaining 27 years on the loan),

b. Denied access to the HAMP’s Principal Reduction Alternative Program, c. Denied the opportunity to collect Pay-for-Performance Success payments from the government, d. Denied the opportunity to obtain a modification of their second lien mortgage through the 2MP (the HAMP program that allows for modification of second liens), e. Denied the opportunity to collect Pay-for-Performance Success payments from the government under the 2MP, f. Denied the opportunity to have their unpaid late fees waived (see PMA, Section 3), g. Charged late fees before and during the trial period, and after the Modification Effective Date, and having their monthly payments improperly used to service those fees, h. Charged appraisal fees, fees for “broker price opinions”, and other valuation and administrative fees during the modification process, and having their monthly trial payments improperly used to service those fees, i. Reported improperly as having a series of delinquent payments to the credit bureaus once their modifications were improperly denied or after they refused to make additional trial payments (beyond the three or four required payments) and other damage to credit scores and ratings, including increasing the total cost of credit,


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j. Deprived of the opportunity to refinance their homes, or seek other means to mitigate losses, k. Subject to the incorrect application of their trial payments to fees and charges instead of appropriately to principal and interest on their loans, leading to excess interest charges, l. Forced to send and re-send the bank documents including large packets of information, either via fax or mail, at the borrowers’ expense, in response to Nationstar’s routine claims of lost or outdated information, m. Subject to emotional distress caused by Nationstar dragging out the HAMP

process, sending default letters, claiming to have never received documents, providing false justifications for denying permanent modifications, and instituting foreclosure proceedings even though the borrowers had satisfied their PMAs and were owed permanent modifications, and

n. Foreclosed on and disposed of their homes even though their loans should’ve been permanently modified.

52. To the extent damages present an inadequate remedy at law, Burton and the Class

Members are entitled to specific performance under their PMAs requiring Nationstar to restore

them to possession along with their promised permanent loan modifications, with Nationstar

incurring all costs, fees, and other charges to carry out such performance. Breach of promise to provide a timely approval or denial

53. Nationstar’s signed PMAs obligated Nationstar to verify its customers’ continued

eligibility prior to the Modification Effective Dates set forth in their PMAs. (See PMA ¶¶ 2A-B.)

54. Burton’s PMA with Nationstar specified August 1, 2009 as the Modification

Effective Date.

55. Nationstar breached the requirement that it verify that its customers’ representations

continued to be true prior to the Modification Effective Date by delaying its review and continuing

to evaluate borrowers long after their Modification Effective Dates had passed. In Burton’s case,

for example, Nationstar was continuing to review his eligibility for the HAMP through March 7,

2010, despite his Modification Effective Date having passed seven months earlier.

56. As a result of these breaches, Burton and the Class Members suffered damages in

the form of those set forth in Paragraph 51 above.


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COUNT II Breach of the Implied Covenant of Good Faith and Fair Dealing

(On behalf of Plaintiff Individually and the Class)


58. Every contract contains an implied covenant requiring that neither party act to

disrupt the other’s ability to enjoy the benefit of the bargain. Furthermore, where a contract

provides one of the Parties with discretion or sole authority to carry out obligations under the

agreement for the benefit of the other Party, the Party enjoying such discretion and authority may

not abuse it or exercise it in such a manner so as to deprive the other Party of the benefits of the

contract.

59. Nationstar has intentionally and continuously acted in a manner so as to frustrate its

borrowers’ ability to obtain modifications of their mortgages. Nationstar has abused its discretion

under its PMAs, which require that it permanently modify its borrowers’ mortgages. Only

Nationstar has the ability to effectuate the modifications that it has promised to provide.

60. By failing to “book,” record, or otherwise cause Burton’s and its other customers’

modifications to be put into effect, Nationstar has abused its authority under its PMAs, frustrated

its borrowers’ ability to obtain the benefits of their signed PMAs, and accordingly breached the

implied covenant of good faith and fair dealing.

61. As a result of Nationstar’s breach, Burton and the Class Members have suffered

damages as set forth in Paragraph 51 above.

COUNT III Promissory Estoppel

(On behalf of Plaintiff Individually and the Class, pled in the alternative to Count I)


63. In its written PMAs, Nationstar expressly promised Burton and the other Class

Members that if their representations continued to be true and correct, as determined by Nationstar

prior to the Modification Effective Date, then their PMAs would “amend and supplement (1) the

Mortgage on the property, and (2) the Note secured by the Mortgage” and that their loan

documents would “automatically become modified on” their respective Modification Effective

Dates.


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64. Burton and the Class Members reasonably relied on these promises, made their

required payments, and kept their representations true and correct through their Modification

Effective Dates. Had Burton and the Class Members known that Nationstar would subsequently

improperly refuse to permanently modify their loans, they would’ve engaged in other efforts to

save their homes, performed “efficient breaches”, declared bankruptcy, or taken other alternatives

that didn’t involve them paying additional monies to Nationstar for essentially nothing in return.

65. Notwithstanding Burton’s and the Class Members’ reliance, Nationstar failed to

honor its promise to permanently modify Burton’s and the Class Members’ loans. Instead,

Nationstar wrongfully foreclosed on them or churned them into less favorable and more costly

foreclosure alternatives.

66. As a result of Nationstar’s conduct, Burton and the Class Members suffered

damages as set forth in Paragraph 51 above.

COUNT IV Fraudulent Misrepresentation

(On behalf of Plaintiff Individually and the Class)


Fraudulent Misrepresentations

68. In its written PMAs provided to Burton and the Class, and executed by Burton on

August 25, 2009, Nationstar expressly, intentionally, and knowingly misrepresented that if

Burton’s and the Class Members’ representations continued to be true and correct, as determined

by Nationstar prior to the Modification Effective Date, then their PMAs would “amend and

supplement (1) the Mortgage on the property, and (2) the Note secured by the Mortgage” and that

their loan documents would “automatically become modified on” the Modification Effective Date.

69. Burton and the Class Members justifiably relied on these material

misrepresentations, made their required payments, and kept their representations true and correct

through their Modification Effective Dates. Had Burton and the Class Members known that

Nationstar would improperly refuse to permanently modify their loans, they would’ve engaged in

other efforts to save their homes, performed “efficient breaches”, declared bankruptcy, or taken

other alternatives that didn’t involve them paying additional monies to Nationstar for essentially


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nothing in return.

70. Notwithstanding Burton’s and the Class Members’ reliance, Nationstar failed to

honor its promise to permanently modify Burton’s and the Class Members’ loans. Instead,

Nationstar wrongfully foreclosed on them or churned them into less favorable and more costly

foreclosure alternatives.

71. As a result of Nationstar’s conduct, Burton and the Class Members suffered

damages as set forth in Paragraph 51 above. Scheme to Defraud

72. Nationstar’s conduct and refusal to permanently modify its borrowers’ mortgages—

despite its borrowers’ full compliance with their PMAs—is part of a broader scheme to extract as

much money as possible from distressed homeowners prior to unlawfully foreclosing and re-taking

possession of their homes. As part of this scheme, Nationstar strings borrowers along for several

extra months and inevitably drops them from the HAMP without sufficient justification.

Nationstar further improperly violates HAMP directives as set forth in Paragraph 22, above.

73. Nationstar has intentionally failed to adhere to basic standards of competence and

diligence in the hope that its borrowers will become too frustrated to challenge its arbitrary

reevaluations and denials.

74. Nationstar has employed personnel to process loan modifications without sufficient

experience or training as part of its effort to confuse and frustrate borrowers.

75. On information and belief, Nationstar has falsely reported its compliance with the

HAMP to the government and has received monies from the government for ostensibly complying

with its directives and guidelines when, in reality, it does not.

76. As a result of this fraudulent pattern and practice, Plaintiff Burton and the Class

Members have suffered damages as set forth in Paragraph 51 above.

COUNT V Unjust Enrichment/Restitution

(On behalf of Plaintiff Individually and the Class, pled in the alternative to Count I)


78. Plaintiff and the other Class Members have conferred benefits on Nationstar,


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including monthly payments that shouldn’t have been made and in the form of their homes which

shouldn’t have been foreclosed on and repossessed.

79. Under such circumstances, equity and good conscience demand that Nationstar

make restitution by returning monies paid during and after trial periods where no permanent

modification was provided and by restoring borrowers with possession of their wrongfully taken

homes.

COUNT VI Violation of California’s Consumer Legal Remedies Act (“CLRA”)

Cal. Civ. §§ 1750 et seq. (On behalf of Plaintiff Individually and the Class)


81. Nationstar’s practices constitute unfair business practices under the CLRA.

82. On January 28, 2013, Plaintiff Burton, through his counsel, sent via certified mail

to Nationstar’s principal place of business in California (as well as to its headquarters in Texas),

return receipt requested, a demand under the CLRA that Nationstar rectify within 30 days its

continuing failure to follow HAMP and provide Burton and the other Class Members with the

permanent modifications they were promised. The certified mail receipt was marked received by

Nationstar’s California agent on February 1, 2013.

83. More than 30 days have passed and Nationstar has failed to respond to the demand

made within the Notice.

84. As a result of Nationstar’s practices described herein, Plaintiff and the Class have

suffered actual damages as set forth in Paragraph 51 above.

COUNT VII Violation of California’s Unfair Competition Law (“UCL”)

Cal. Bus. & Prof. Code § 17200 et seq. (On behalf of Plaintiff Individually and the Class)

85. Plaintiff re-alleges and incorporates the above and below allegations as if set forth

fully herein.

86. Nationstar’s conduct as described throughout this Complaint is unlawful under the

UCL—it violates the Equal Credit Opportunity Act’s (“ECOA”) requirement that lenders provide

timely answers on credit applications, as well as numerous provisions of the HAMP directives that


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prohibit the charging of late fees, dual tracking, falsely telling borrowers they need to be in default

to qualify, reevaluating borrowers after their Modification Effective Dates and otherwise grossly

mishandling its borrowers’ HAMP applications and contract documents.

87. Nationstar’s conduct as described throughout this Complaint, specifically as set

forth in Paragraphs 67 – 76 above and incorporated herein, violates the UCL’s fraudulent prong.

88. Nationstar’s conduct is unfair under the UCL. There is no benefit to society in

allowing Nationstar to serially breach its PMAs, mislead borrowers regarding their ability to

obtain loan modifications, or foreclose on borrowers who have fully complied with all PMA and

HAMP requirements. Taxpayers have funded a system designed to help borrowers save their

homes and Nationstar’s conduct is the antithesis of how a Servicer should act under the HAMP.

Nationstar’s conduct as described throughout this Complaint is substantially injurious to

consumers and shouldn’t be allowed to continue.

89. As a result of Nationstar’s unlawful, fraudulent, and unfair conduct, Plaintiff and

the members of the Class have suffered loss of money and property.

COUNT VIII Violation of the Equal Credit Opportunity Act (“ECOA”)

15 U.S.C. § 1691e (On behalf of Plaintiff Individually and the Class)


91. HAMP Servicers like Nationstar are required to follow all other laws, including

specifically the ECOA.

92. Regulation B, codified at 12 C.F.R. § 202.9 governs ECOA notices and provides as

follows:

(a) Notification of action taken, ECOA notice, and statement of specific reasons--(1) When notification is required. A creditor shall notify an applicant of action taken within: (i) 30 days after receiving a completed application concerning the creditor’s approval of, counteroffer to, or adverse action on the application; (ii) 30 days after taking adverse action on an incomplete application, unless notice is provided in accordance with paragraph (c) of this section; (iii) 30 days after taking adverse action on an existing account; or (iv) 90 days after notifying the applicant of a counteroffer if the applicant does not expressly accept or use the credit offered.


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93. ECOA, 15 U.S.C. § 1691(d) states that a creditor must provide reasons for a denial

of credit.

(d) Reason for adverse action; procedure applicable; “adverse action” defined (1) Within thirty days (or such longer reasonable time as specified in regulations of the Bureau for any class of credit transaction) after receipt of a completed application for credit, a creditor shall notify the applicant of its action on the application. (2) Each applicant against whom adverse action is taken shall be entitled to a statement of reasons for such action from the creditor. A creditor satisfies this obligation by— (A) providing statements of reasons in writing as a matter of course to applicants against whom adverse action is taken

(6) For purposes of this subsection, the term “adverse action” means a denial or revocation of credit, a change in the terms of an existing credit arrangement, or a refusal to grant credit in substantially the amount or on substantially the terms requested. Such term does not include a refusal to extend additional credit under an existing credit arrangement where the applicant is delinquent or otherwise in default, or where such additional credit would exceed a previously established credit.

94. Nationstar is a “creditor” as defined by the ECOA, 15 U.S.C. § 1691a(e) because it

regularly extends, renews, or continues credit and/or regularly arranges for the extension, renewal,

or continuation of credit and in some cases is an assignee of an original creditor who participates

in the decision to extend, renew, or continue credit.

95. Plaintiff and Class Members who made three trial payments and had a signed PMA

are “applicants” for a permanent HAMP loan modification as defined by ECOA 15 U.S.C. §

1691a(b).

96. Plaintiff and Class Members submitted “completed applications” for permanent

HAMP loan modifications pursuant to 12 C.F.R. § 202.9(a)(1)(i) no earlier than the date which

they made the third payment required by their TPPs.

97. Nationstar failed to provide notice of action taken on Plaintiff’s and Class

Members’ applications or provide specific reasons for denial within 30 days of its receipt of a

completed application in violation of 15 U.S.C. § 1691(d) and 12 C.F.R. § 202.9(a).

98. In the alternative, Nationstar failed to act on Plaintiff’s and Class Members’

incomplete applications or provide specific reasons for denial within 30 days of taking action on

incomplete applications in violation of 15 U.S.C. § 1691(d) and 12 C.F.R. § 202.9(a).


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99. Plaintiff and Class Members were charged fees, reported as 30 days or more

delinquent on their credit reports, and deprived of the opportunity to take other action to save their

homes, including performing an “efficient breach,” as a result of Nationstar’s failure to take action

on their completed credit applications for loan modifications.

PRAYER FOR RELIEF

WHEREFORE, in light of the foregoing, Plaintiff Burton, on behalf of himself and a

Class of all others similarly situated, respectfully prays that the Court enter an Order:

a. Certifying this action as a Class Action, appointing Burton as Class Representative

and his Counsel as Class Counsel;

b. Entering judgment against Nationstar and in favor of Burton and the Class

Members for actual and compensatory damages as described herein on Counts I, II, III, IV, V, VI

and VIII in an amount to be proven at trial;

c. Where damages present an inadequate remedy at law on any Count, entering

judgment against Nationstar and in favor of Burton and the Class Members for specific

performance requiring that Nationstar unwind their foreclosures, permanently modify their loans

as promised, and restore them to possession of their wrongfully foreclosed homes covering all

attendant fees and costs;

d. Entering judgment against Nationstar and in favor of Burton and the Class

Members for statutory damages and all other available remedies under the CLRA and ECOA;

e. Awarding punitive damages on Counts IV and VIII against Nationstar;

f. Awarding restitution on Count V;

g. Awarding damages for emotional pain, suffering and other actual, non-economic

damages caused by Nationstar’s wrongful and fraudulent foreclosures;

h. Enjoining Nationstar’s continuous breaches of its PMAs and violations of HAMP

directives on all common law claims where available and under the UCL;

i. Awarding Plaintiff reasonable attorneys’ fees and costs; and

j. Awarding such additional relief as the Court deems necessary and just.


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Dated: March 4, 2013 Respectfully Submitted, DENNIS BURTON, individually and on behalf of a Class of similarly situated individuals,

By: /s/ Sean P. Reis___________ Sean P. Reis

Sean P. Reis (SBN 184044) EDELSON MCGUIRE, LLP 30021 Tomas Street, Suite 300 Rancho Santa Margarita, California 92688 Telephone: (714) 352-5200 Facsimile: (714) 352-5201 Email: [email protected] Steven L. Woodrow (Pro Hac Vice admission sought) Megan Lindsey (Pro Hac Vice admission sought) EDELSON MCGUIRE LLC 350 North LaSalle Street, Suite 1300 Chicago, Illinois 60654 Telephone: (312) 589-6370 Facsimile: (312) 589-6378 Email: [email protected] Email: [email protected]


Sean Reis

Pencil

Case 1:13-at-00123 Document 1-1 Filed 03/04/13 Page 1 of 12

Group ExhibitA


Exhibit A-1


Investor Loan 0596501065

HOME AFFORDABLE MODIFICATION TRIAL PERIOD PLAN

(Step One of Two-Step Documentation Process)Trial Period Plan Effective Date: 0510612009Borrower ("I")l: DENNIS BURTONLender ("Lender"): Nationstar Mortgage LLCDate of first lien Security Instrument ("Mortgage") and Note ("Note"): December 28, 2006Loan Number: 0596501065

Property Address ("Property"): 5705 NOMI STREET, BAKERSFIELD CA 93308

if I am in compliance with this Trial Period Plan (the "Plan") and my representations in Section 1 continue to betrue in all material respects, then the Lender will provide me with a Home Affordable Modification Agreement("Modification Agreement"), as set forth in Section 3, that would amend and supplement (1) the Mortgage on the

Property, and (2) the Note secured by the Mortgage. The Mortgage and Note together, as they may previouslyhave been amended, are referred to as the "Loan Documents.' Capitalized terms used in this Plan and notdefined have the meaning given to them in the Loan Documents.

If I have not already done so, I am providing confirmation of the reasons I cannot afford my mortgage paymentand documents to permit verification of all of my income (except that I understand that I am not required todisclose any child support or alimony unless I wish to have such income considered) to determine whether I

qualify for the offer described in this Plan (the "Offer"). I understand that after I sign and return two copies of thisPlan to the Lender, the Lender will send me a signed copy of this Plan if I qualify for the Offer or will send me

written notice that I do not qualify for the Offer. This Plan will not take effect unless and until both I and theLender sign it and Lender'provides me with a copy of this Plan with the Lender's signature.

My Representations. I certify, represent to Lender and agree:

A. I am unable to afford my mortgage payments for the reasons indicated in my Hardship Affidavitand as a result, (i) I am either in default or believe I will be in default under the Loan Documentsin the near future, and (ii) I do not have sufficient income or access to sufficient liquid assets tomake the monthly mortgage payments now or in the near future;

B. I live in the Property as my principal residence, and the Property has not been condemned;C. There has been no change in the ownership of the Property since I signed the Loan Documents;

i am providing or aiready nave provided documentation for ail income that i receive (and i

understand that I am not required to disclose any child support or alimony that I receive, unless Iwish to have such income considered to qualify for the Offer);

E. Under penalty of perjury, all documents and information I have provided to Lender pursuant tothis Plan, including the documents and information regarding my eligibility for the program, are

true and correct; and

F. If Lender requires me to obtain credit counseling, I will do so.

If there is more than one Borrower or Mortgagor executing this document, each is referred to as "I". For purposes of this document words

signifying the singular (such as "I') shall include the plural (such as "we") and vice versa where appropriate.HOME AFFORDABLE MODIFICATION TRIAL PERIOD PLAN Single Family Fannie Mae/Freddle Mac UNIFORM INSTRUMENT

Form 3156 3/09 (rev. 3109) (page 4 of 10 pages)


2. The Trial Period Plan. On or before each of the following due dates, I will pay the Lender the amountset forth below ("Trial Period Payment"), which includes payment for Escrow Items, including real estatetaxes, insurance premiums and other fees, if any, of U.S. $1921.58.

Trial Period Trial Period Due Date

Payment Payment On or Before1 $1921.58 05106120092 $1921.58 06/01/20093 $1921.58 07/01/20094 $1921.58

The Trial Period Payment is an estimate of the payment that will be required under the modified loan

terms, which will be finalized in accordance with Section 3 below.

During the period (the "Trial Period") commencing on the Trial Period Effective Date and ending on theearlier of: (i) the first day of the month following the month in which the last Trial Period Payment is due

(the "Modification Effective Date") or (ii) termination of this Plan, I understand and acknowledge that:

A. TIME IS OF THE ESSENCE under this Plan;B. Except as set forth in Section 2.C. below, the Lender will suspend any scheduled foreclosure sale,

provided I continue to meet the obligations under this Plan, but any pending foreclosure action willnot be dismissed and may be immediately resumed from the point at which it was suspended if thisPlan terminates, and no new notice of default, notice of intent to accelerate, notice of acceleration, or

similar notice will be necessary to continue the foreclosure action, all rights to such notices beinghereby waived to the extent permitted by applicable law;

C. If my property is located in Georgia, Hawaii, Missouri, or Virginia and a foreclosure sale is currentlyscheduled, the foreclosure sale will not be suspended and the lender may foreclose if I have notmade each and every Trial Period Payment that is due before the scheduled foreclosure sale. If a

foreclosure sale occurs pursuant to this Section 2.0., this agreement shall be deemed terminated;D. The Lender will hold the payments received during the Trial Period in a non-interest bearing account

until they total an amount that is enough to pay my oldest delinquent monthly payment on my loan infull. If there is any remaining money after such payment is applied, such remaining funds will be held

by the Lender and not posted to my account until they total an amount that is enough to pay the nextoldest delinquent monthly payment in full;

E. When the Lender accepts and posts a payment during the Trial Period it will be without prejudice to,and will not be deemed a waiver of, the acceleration of the loan or foreclosure action and relatedactivities and shall not constitute a cure of my default under the Loan Documents unless such

payments are sufficient to completely cure my entire default under the Loan Documents;F. If prior to the Modification Effective Date, (i) the Lender does not provide me a fully executed copy of

this Plan and the Modification Agreement; (ii) I have not made the Trial Period payments requiredunder Section 2. ot this Plan; or (Iii) the Lender determines that my representations in Sect;on 1 are

no longer true and correct, the Loan Documents will not be modified and this Plan will terminate. Inthis event, the Lender will have all of the rights and remedies provided by the Loan Documents, and

any payment I make under this Plan shall be applied to amounts I owe under the Loan Documentsand shall not be refunded to me; and

G. I understand that the Plan is not a modification of the Loan Documents and that the Loan Documentswill not be modified unless and until (i) I meet all of the conditions required for modification, (ii) Ireceive a fully executed copy of a Modification Agreement, and (iii) the Modification Effective Datehas passed. I further understand and agree that the Lender will not be obligated or bound to make

any modification of the Loan Documents if I fail to meet any one of the requirements under this Plan.

HOME AFFORDABLE MODIFICATION TRIAL PERIOD PLAN Single Family Faimle Mae/Freddie Mac UNIFORM INSTRUMENTForm 3156 3/09 (rev. 3/09) (page 5 of 10 pages)


3. The Modification. I understand that once Lender is able to determine the final amounts of unpaidinterest and any other delinquent amounts (except late charges) to be added to my loan balance andafter deducting from my loan balance any remaining money held at the end of the Trial Period underSection 2.D. above, the Lender will determine the new payment amount. If I comply with therequirements in Section 2 and my representations in Section 1 continue to be true in all materialrespects, the Lender will send me a Modification Agreement for my signature which will modify my LoanDocuments as necessary to reflect this new payment amount and waive any unpaid late chargesaccrued to date. Upon execution of a Modification Agreement by the Lender and me, this Plan shallterminate and the Loan Documents, as modified by the Modification Agreement, shall govern the termsbetween the Lender and me for the remaining term of the loan.

4. Additional Agreements. I agree to the following:

A. That all persons who signed the Loan Documents or their authorized representative(s) have signedthis Plan, unless a borrower or co-borrower is deceased or the Lender has waived this requirement inwriting.

B. To comply, except to the extent that they are modified by this Plan, with all covenants, agreements,and requirements of Loan Documents, including my agreement to make all payments of taxes,insurance premiums, assessments, Escrow items, impounds, and all other payments, the amount ofwhich may change periodically over the term of my loan.

C. That this Plan constitutes notice that the Lender's waiver as to payment of Escrow Items, if any, hasbeen revoked, and I have been advised of the amount needed to fully fund my Escrow Account.

D. That all terms and provisions of the Loan Documents remain in full force and effect; nothing in thisPlan shall be understood or construed to be a satisfaction or release in whole or in part of theobligations contained in the Loan Documents. The Lender and I will be bound by, and will complywith, all of the terms and provisions of the Loan Documents,

E. Notwithstanding anything herein to the contrary, if my final two Trial Period Payments are received byServicer after the close of business on the 15th calendar day of the last month of the Trial Period butbefore the end of the Trial Period, I agree that the Trial Period shall be extended by one calendarmonth (the "Additional Trial Period"). I agree to abide by all terms and provisions of this Loan WorkoutPlan during the Additional Trial Period. In addition, I agree to make a Trial Period Payment in theamount of $1921.58 no more than 30 days after the last due date listed in the chart in Section 2above.

F. Notwithstanding anything herein to the contrary, that the implementation of any ModificationAgreement is conditioned on the Servicer's receipt of an acceptable title endorsement or other similartitle insurance product or subordination agreement from other existing lienholders, as necessary, toensure that the modified mortgage loan retains its first lien position and is fully enforceable as

required by the Fannie Mae Servicing Guide.

In WitnRss WhPrPof, the 1..PndPr and i have PxPrlitPd thiQ Plan,

Nationstar Mortgage LLC I (Seal)Lender gorrower

DateBy: pe,,PV---\ (Seal)

Borrower

Date Date

HOME AFFORDABLE MODIFICATION TRIAL PERIOD PLAN Single Family Fannie Mae/Freddle Mac UNIFORM INSTRUMENTForm 3156 3109 (rev. 3109) (page 6 of 10 pages)


Exhibit A-2


RECORD AND RETURN TO:Nationstar Mortgage LLC350 Highland DriveLewisville, Texas 75067

THIS DOCUMENT WAS PREPARED BY:SHARON KIMNationstar Mortgage LLC350 Highland DriveLewisville, Texas 75067

Tax Parcel No.:

[Space Above This Line For Recording Data]Loan No.: 0586501065

HOME AFFI RDAzLE MODIFICATION kGREEMENT(Step Two of Two-Step Documentation Process)

Borrower ("I"):1 DENNIS BURTON

Lender ("Lender"): Nationstar Mortgage LLC

Date of first lien Security Instrument ("Mortgage") and Note ("Note"):Loan Number: 0596501065

Property Address: 5705 NOMI STREETBAKERSFIELD, CALIFORNIA 93308

Legal Description:A PARCEL OF LAND LOCATED IN THE STATE OF CA, COUNTY OF KERN,WITH A SITUS ADDRESS OF 5705 NOMI ST, BAKERSFIELD CA93308-4047 CO30 CURRENTLY OWNED BY BURTON DENNIS HAVING A TAXASSESSOR NRIMRER OF 365-102-06-00 AND BEING THE SAME PROPERTYMORE FULLY DESCRIBED AS TRACT 3584 LOT 19.

("Property"):

1 If there is more than one Borrower or Mortgagor executing this document, each la referred to as "I." For purposes of thisdocument words signifying the singular (such as "I") shall include the plural (such as "we") and vice versa where appropriate.

MULTISTATE HOME AFFORDABLE MODIFICATION AGREEMENT Single Family Fannie Mae/Freddie MacUNIFORM INSTRUMENT Form 3157 3/09FALPS# FM3157 Rev. 05-01-09 (page 1 of 6)


0596501065If my representations in Section 1 continue to be true In_all._materiaL respects, then this HomeAffordable Modification Agreement ("Agreement') will, as set forth in Section 3, amend and

supplement (1) the Mortgage on the Property, and (2) the Note Secured by the Mortgage.The Mortgage and Note together, as they may previously have been amended, are referred to as

the "Loan Documents." Capitalized terms used in this Agreement and not defined have the

meaning given to them in Loan Documents.

I understand that after I sign and return two copies of this Agreement to the Lender, the Lender willsend me a signed copy of this Agreement. This Agreament will -not take effect unless the

preconditions set forth in Section 2 have been satisfied.

1. My Representations. I certify, represent to Lender and agree:.

A. I am experiencing a financial hardship, and as a result, (i) lam in default under theLoan Documents, and (ii) I do not have sufficient income or access to sufficient

liquid assets to make the monthly mortgage payments now or in the near future;B. I live in the Property as my principal residence, and the Property has not been

condemned;C. There has been no change in the ownership of the Property since I signed the

Loan Documents;.D. I have provided documentation for all income that I receive (and I understand that I

am not required to disclose child support or alimony unless L. chose to rely on suchincome when requesting to qualify for the Home Affordable Modification Program("Program"));

E. Under penalty of perjury, all documents and information I have provided to Lenderin connection with this Agreement, including the documents and information

regarding my eligibility for the Program, are true and correct;F. If Lender requires me to obtain credit counseling in connection with the Program, I

will do so;G. I. have made or will make all payments required under a Trial Period Plan or Loan

Workout Plan.

2. Acknowledgements and Preconditions to Modification. I understand and acknowledgethat:

A. TIME lS OF THE ESSENCE under this Agreement;B. If prior to the Modification Effective Date as set forth in Section 3 the Lender

deterrnimes that my mresentations in SPetinn 1 Pire nn lonTr!, r true end etorrert, thr

Loan Documents will not be modified and this Agreement will terminate. In this event,the Lender will have all of the rights and remedies provided by the Loan. Documents;and

C. I understand that the Loan Documents wiil not be modified unless and until (i) I receivefrom the Lender a copy of this Agreement signed by the Lender, and (ii) theModification Effective Date (as defined in Section 3) has occurred. I furtherunderstand and agree that the Lender will not be obligated or bound to make anymodification of the Loan Document if I fail to meet any one of the requirements underthis Agreement.

MULTISTATE HOME AFFORDABLE MODIFICATION AGREEMENT Single Family Fannie Mae/Freddie Mac

UNIFORM INSTRUMENT Form 3157 3/09

FALPS# FM3157-2 Rev. 05-01-09 (page 2 of 6)

Case 1:13-at-00123 Document 1-1 Filed 03/04113 Page 9 of 12

0596501065

3. The Modification. If my representations in Section 1 continue to be true in all material

respects and all preconditions to the modification set forth in Section 2 have been met, theLoan Documents will automatically become modified on AUGUST 1, 2009 (the"Modification Effective Date") and all unpaid late charges that remain unpaid will bewaived. The Loan Documents will be modified and the first modified payment will be dueon SEPTEMBER 1, 2009.

A. The new Maturity Date will be: JANUARY 1, 2037.B. The modified Principal balance of my Note will, include all amounts and arrearages

that will be past due (excluding unpaid late charges) less any amounts paid to theLender but not previously credited to my Loan. The hew Principal balance of my Notewill be 311,086.75 (the "New Principal Balance").,.

C. Interest at the rate of 3.750 will begin to accrue on the New Principal Balanceas of AUGUST 1, 2009 and the first new monthly payment on the New PrincipalBalance will be due on SEPTEMBER 1, 2009, My payment schedule for the modifiedLoan is as follows:

Years Interest Interest Monthly Monthly Teial, Payment Number ofRate Rate Principal Escrow:- •Monthly. aegins On Monthly

Change and Payment Payrhent PaymentsDate Interest Amount

PaymentAmount

1-5 3.750% 08/01/2009 $1, 514.84 $400.36 $1,915.20 09/01/2009 so

adjusts. adjustsannUally annuallyafter year 1 after year 1Adjusts. Adjusts4.750% 08/01/2014 $1, 665.25 09/01/2014 12Annually Annually

7-27 5.250% 08/0112015 $1,740, 51 Adjusts Adjusts 09/01/2015 257Annually.. Annually

The aboVe terms in this Section 3.C. shall supersede any provisions to the contrary in

the Loan Doc6ments, including but not limited to, provisions for an adjustable or stepinterest rate:

D. I will be in default if I do not comply with the terms of the Loan Documents, as

modified by this Agreement.E. lf a default rate of interest is permitted under the Loan Documents, then in the event of

default under the Loan Documents. as amended, the interest that wiii be due vviii be

the rate set felt-ft) in 2er:firm 3 C

MULTISTATE HOME AFFORDABLE MODIFICATION AGREEMENT Single; Family Fannie Mae/Freddie MacUNIFORM INSTRUMENT Form 3157 3/09FALPS# FM3157-3, 3 Rev. 05-01-09 (page 3 of6)


05965010654. Additional Agreements. I agree to the following:

A. That all persons who signed the Loan DocumentS or their aüthorized representative(s)have signed this Agreement, unless a borrower. Or.6q,.borrower is deceased or theLender has waived this requirement in writing.'

B. That this Agreement shall supersede the terms of anYmodification, forbearance, TrialPeriod Plan or Workout Plan that I previously entered into with Lender.

C. To comply, except to the extent that they are modified: by this Agreement, with allcovenants, agreements, and requirements ofLban ;":1Pocurhents including myagreement to make all payments of taxes, insUrance premiums, assessments, EscrowItems, impounds, and all other payments, the :amount of which may changeperiodically over the term of my Loan.

D. That this Agreement constitutes notice that the Lenders waiver as to payment ofEscrow Items, if any, has been revoked, and I haVo been advised of the amountneeded to fully fund my Escrow Account,

E. That the Loan Documents are composed of -duly valid, binding agreements,enforceable in accordance with their terms and are herebY. reaffirmed.

F. that all terms and provisions of the Loan Documents, except .as expressly modified bythis Agreement, remain in full force and effect; 'nothing in: this Agreement shall beunderstood or construed to be a satisfaction or release :in whole or in part of the

obligations contained in the Loan Documents; and that:except as otherwise specificallyprovided in, and as expressly modified by, this Agreement, the Lender and I will bebound by, and will comply with, all of the terms and conditions of the Loan Documents.

G. That, as of the Modification Effective Date, notwithstanding any other provision of theLoan Documents, I agree as follows: If all or any part of the Property or any interest init is sold or transferred without Lender's prior written consent, Lender may, at its option,require immediate payment in full of all sums secured by the Mortgage. However,Lender shall not exercise this option if federal law prohibits the exercise of such optionas of the date of such sale or transfer. If Lender exercises this option, Lender shall

give me notice of acceleration. The notibe shall provide a period of not less than 30

days from the date the notice is delivered or mailed:within which I must pay all sums

secured by the Mortgage. If I fail to pay these sums prior to the expiration of this

period, Lender may invoke any remedies permitted:.bY. the Mortgage without furthernotice or demand on me.

H. That, as of the Modification Effective Date, a buyer or transferee of the Property will notbe permitted, under any circumstance, to assume the Loan.. This Agreement may not,under --ny cimumstance,,, be assignr=d tr,, or assume, ky, a kuyor of the Prop', rty.

MULTISTATE ROME AFFORDABLE MODIFICATION AGREEMENT.::- Singfo'.Fainily Fannie Mae/Freddie MacUNIFORM INSTRUMENT Form 3157 3/09FALPS# FM3157-4 Rev. 05-01-09. (pogo 4 of 6)

Date

te


In Witness Whereof, the Lender and 1 have executed this Agreement.

Nationstar Mortgage LLC

D596501065

-Borrower

-Borrower

a

-Borrower

Date

MULTISTATE HOME AFFORDABLE MODIFICATIOt4 AGREEMENT Single Family Fannie Mae/Freddie Mac

UNIFORM INSTRUMENT Form 3157 3109

FALPS# FM3157-5 Rev. 05-01-09 (page 5 of 6)

te----'-Lender

By:

i;1)Date,.

DENNIS B-1.44,ZT9.11:_.:.--.,, -Borrower

Date


05g6501065

[Space Below This Line for Acknowledgment]

BORROWER'S ACKNOWLEDGMENT

State of Cakforni

County of L-M-A--/L//On 01,497 before me, cle, -personally appeared

(here insert narpeaL51(title ot otficy)DENNIS BURTON

who proved to me on the basis of satisfactory evidence to be the personW whose nameg Is/04subscribed to the within instrument and acknowledged to me that he/s1tlthe9.executed the same in his/

W.1:4Wir authorized capacity, and that •by Ns/,11)§u/t.gri_ signatureA on the instrument the

persoinM, or the entity upon behalf of which the personM,. acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoingparagraph is true and correct. IfICTOBIA c, DE LA CRUZWITNESS my hand and official seal. if) .011, :21. COMM. #1 714182

1.1 :It -0= NOTARY PUBLIC. CALIFORNIA

i KERN COUNTY

Zi I (4;i7 c.'r( q rt.1.1e, My Comm. Exp. Feh. 1, 2011

Signatur 6--c-' A-7.----' .--4......,..e_ it

LENDER'S ACKNOWLEDGMENT

State of

County of

On before me, personaHy appeared(here insert name ond-tItie of officer)

who proved to me on the basis of saUsfactory evidence to be the person(s) whose name(s) is/areeuheenbefl tc the within Instrument encleeknewieriged to imP that nniqhe/they execu[Rd the same in his/

he.r/their authorized hApacity(ic..$), and that hy irin(q) nn the instrument thn

person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoingparagraph is true and correct.

WITNESS my hand and official seal.

Signature (Seal)

MULTISTATE HOME AFFORDABLE MODIFICATION AGREEMENT Single Family Fannie MaelFreddle MacUNIFORM INSTRUMENT Form 3157 3109FALPS# CAFM3157-6 Rev. 05-01-09 (page 6 of6)

Exhibit B


I.

AMENDED AND RESTATED

COMMITMENT TO PURCHASE FINANCIAL INSTRUMENTand

SERVICER PARTICIPATION AGREEMENT

This Amended and Restated Commitment to Purchase Financial Instrument and ServiceI' Participation Agreement (the"Commitment") is entered into as ofthe Effective Date, by and between Federal National Mortgage Association, a federallycbaltered corporation, as financial agent of the United States ("Fannie Mae"), and the undersigned palty ("Servicer").Capitalized terms used, but not defined contextually, shall have the meanings ascribed to them in Section 12 below.

Recitals

WHEREAS, the U.S. Depaltment ofthe Treasury (the "Treasury") has established a Home Affordable Modification Program(the "HAMP") pursuant to section 10 1 and 109 ofthe Emergency Economic Stabilization Act of2008 (the "Act"), as section109 of the Act has been amended by section 7002 of the American Recovery and Reinvestment Act of2009;

WHEREAS, Fannie Mae, as financial agent of the United States, and ServiceI' entered into a Commitment to PurchaseFinancial Instrument and ServiceI' Pmticipation Agreement for the Home Affordable ModifICation Program under theEmergency Economic Stabilization Act (the "Prior Agreement") in connection with the implementation ofHAMP, the primarypurpose of which was the modification of first lien mOltgage loan obligations and the provision of loan modification andforeclosure prevention services relating thereto (the "HAMP Services");

WHEREAS, the Treasury has established a variety ofnew programs (together with the HAMP, the "Programs") under the Actto further stabilize the housing market by facilitating second lien mOltgage loan modifications and extinguishments, providinghome price decline protection incentives, encouraging foreclosure alternatives, such as Sh0l1 sales and deeds in lieu offoreclosure, and making other foreclosure prevention services available to the marketplace (collectively, together with theHAMP Services, the "Services");

WHEREAS, the Programs may include Services relating to FHA, VA and USDA loans;

WHEREAS, Fannie Mae has been designated by the Treasury as a financial agent ofthe United States in connection with theimplementation ofthe Programs; all references to Fannie Mae in the Agreement shall be in its capacity as financial agent oftheUnited States;

WHEREAS, Fannie Mae will fulfill the roles of administrator and record keeper for the Programs, and in conjunctiontherewith must standard ize celtain mortgage mod ification and foreclosure prevention practices and procedures as they relate tothe Programs, consistent with the Act and in accordance with the directives of, and guidance provided by, the Treasury;

WHEREAS, Federal Home Loan MOltgage Corporation ("Freddie Mac") has been designated by the Treasury as a financialagent ofthe United States and will fulfill a compliance role in connection with the Programs; all references to Freddie Mac inthe Agreement shall be in its capacity as compliance agent of the Programs;

WHEREAS, Fannie Mae and Servicer desire to amend and restate the Prior Agreement in its entirety as set forth herein;

WHEREAS, all Fannie Mae and Freddie Mac approved servicers are being directed through their respective servicing guidesand bulletins to implement the Programs with respect to mortgage loans owned, securitized, or guaranteed by Fannie Mae orFreddie Mac (the "GSE Loans"); accordingly, this Agreement does not apply to the GSE Loans;


WHEREAS, all other servicers, as well as Fannie Mae and Freddie Mac approved servicers, that wish to pat1icipate in thePrograms with respect to loans that are not GS E Loans (collectively, "Pat1icipating Servicers") must agree to certain terms andconditions relating to the respective roles and responsibilities ofparticipants and other financial agents ofthe government; and

WHEREAS, ServiceI' wishes to pat1icipate in the Programs as a Pal1icipating ServiceI' on the terms and subject to theconditions set f0l1h herein.

Accordingly, in consideration ofthe representations, warranties, and mutual agreements set fOlih herein and for other good andvaluable consideration, the receipt and sufficiency of which are hereby acknowledged, Fannie Mae and ServiceI' agree toamend and restate the Prior Agreement in its entirety, as follows.

Agreement

1. Services

A. Contemporaneously with the execution and delivery ofthis Commitment and the Financial Instrument, ServiceI' willexecute and deliver to Fannie Mae one or more schedules describing the Services to be performed by ServiceI' pursuant to thisAgreement, effective as of the Effective Date ofthe Agreement (each, a "Service Schedule" or an "Initial Service Schedule"and, collectively, the "Initial Service Schedules"). After the Effective Date of the Agreement, ServiceI' may opt-in to anyadditional initiatives offered by Treasury in connection with the Programs by executing and delivering to Fannie Mae one ormore additional Service Schedules describing the Services relating to such initiatives (each, a "Service Schedule" or an"Additional Service Schedule" and, collectively, the "Additional Service Schedules") (the Initial Service Schedules and theAdditional Service Schedules, collectively, the "Service Schedules"). All Service Schedules that are executed and delivered toFannie Mae by ServiceI' f!'Om time to time will be numbered sequentially (e.g. Service Schedule A-I; Service Schedule A-2;Service Schedule A-3; et seq.) and are referenced herein, collectively, as Exhibit A; Exhibit A is hereby incorporated into theCommitment by this reference.

B. Subject to Section 10.C., ServiceI' shall perform the Services described in (i) the Financial Instrument attached heretoas Exhibit B (the "Financial Instrument"); (li) the Service Schedules attached hereto, collectively, as Exhibit A; (iii) theguidelines and procedures issued by the Treasury with respectto the Programs outlined in the Service Schedules (the "ProgramGuidelines"); and (iv) any supplemental documentation, instructions, bulletins, frequently asked questions, letters, directives,or other communications, including, but not limited to, business continuity requirements, compliance requirements,performance requirements and related remedies, issued by the Treasury, Fannie Mae, or Freddie Mac in order to change, orfUL1her describe 01' clarify the scope of, the rights and duties of the Participating Servicers in connection with the Programsoutlined in the Service Schedules (the "Supplemental Directives" and, together with the Program Guidelines, the "ProgramDocumentation"). The Program Documentation will be available to all Pm1icipating Servicers at www.HMPadmin.com; forthe avoidance of doubt, the term "Program Documentation" includes all of the Program Guidelines and SupplementalDirectives issued by TreasUlY and made available to Pm1icipating Servicers at www.HMPadmin.com prior to the EffectiveDate of the Agreement. The Program Documentation, "S the same may be modified or amended from time to time inaccordance with Section 10 below, is hereby incorporated into the Commitment by this reference.

C. Servicer's representations and warranties, and acknowledgement ofand agreement to fulfill or satisfY ce11ain dutiesand obligations, with respect to its pal1icipation in the Programs and under the Agreement are set forth in the FinancialInstrument. Servicer's cel1ification as to its continuing compliance with, and the truth and accuracy of, the representations andwarranties set fOl1h in the Financial Instrument will be provided annually in the form attached hereto as Exhibit C (the"Ce11ification"), beginning on June 1,2010 and again on June 1 ofeach year thereafter during the Term (as defined below) andupon the execution and delivery by ServiceI' of any Additional Service Schedule during the Term.

D. The recitals set forth above are hereby incorporated herein by this reference.

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2. Authority and Agreement to Participate in Programs

A. Servicer shall perform the Services for all mortgage loans it services, whether it services such mortgage loans for itsown account or for the account ofanother pmty, including any holders ofmortgage-backed securities (each such other party,an "Investor").

B. Fannie Mae acknowledges that ServiceI' may service m0l1gage loans for its own account or for the account ofone ormore Investors and may be subject to restrictions set fOlth in pooling and servicing agreements or other servicing contractsgoverning Set'vicer's servicing of a m011gage loan; ServiceI' shall use reasonable efforts to remove all prohibitions 01'impediments to its authority, and use reasonable eff0l1s to obtain all third party consents, waivers and delegations that arerequired, by contract or law, in order to perform.the Services.

C. Notwithstanding subsection B., if(x) ServiceI' is unable to obtain all necessary consents, waivers and delegations forperforming any Services under the Programs, or(y) the pooling and servicing agreement or other servicing contract governingServicer's servicing ofa m0l1gage loan prohibits ServiceI' from performing such Services for that mortgage loan, ServiceI' shallnot be required to perform such Services with respect to that m0l1gage loan and shall not receive all or any p0l1ion of thePurchase Price (defined below) othmwise payable for such Services with respect to such loan.

D. Notwithstanding anything to the contrary contained herein, the Agreement does not apply to GSE Loans. Servicers aredirected to the servicing guides and bulletins issued by Fannie Mae and Freddie Mac, respectively, concerning the Programs asapplied to GSE Loans.

E. Servicer's performance ofthe Services and implementation ofthe Programs shall be subject to review by Freddie Macand its agents and designees as more fully set f0l1h in the Agreement.

3. Set Up; Prerequisite to Payment

ServiceI' will provide to Fannie Mae: (a) the set up information required by the Program Documentation and any ancillary oradministrative infOlmation requested by Fannie Mae in order to process Servicer's patticipation in the Programs as aPmticipating ServiceI' on or before the Effective Date of the Agreement as to the Initial Service Schedules that are executedand delivered contemporaneously herewith, and on or before the effective date of the Additional Service Schedules (if any)executed and delivered after the Effective Date of the Agreement; and (b) the data elements for each mOltgage obligation,propmty, or borrower eligible for the Programs as and when described in the Program Documentation and the FinancialInstrument. Purchase Price payments will not be remitted pursuant to Section 4 with respect to Services for which the requireddata elements have not been provided.

4. Agreement to Purchase Financial Instrument; Payment of Purchase Price

A. Fannie Mae, in its capacity as a financial agent ofthe United States, agrees to purchase, and ServiceI' agrees to sell toFannie Mae, in such capacity, the Financial Instrument that is executed and delivered by ServiceI' to Fannie Mae in the formattached hereto as Exhibit B, in consideration for the payment by Fannie Mae, as agent, of the Purchase Pdce.

B. The conditions precedent to the payment by Fannie Mae of the Purchase Price with respect to the Services describedon the Initial Service Schedules are: (a) the execution and delivery of the Commitment, the Initial Service Schedules, and theFinancial Instrument by ServiceI' to Fannie Mae; (b) the execution and delivery of the Commitment and the Initial ServiceSchedules by Fannie Mae to Servicer; (c) the delivery ofcopies of the fully executed Commitment, Initial Service Schedulesand Financial Instrument to Treasury on the Effective Date of the Agreement; (d) the performance by ServiceI' ofthe Servicesdescribed in the Agreement, in accordance with the terms and conditions thereof, to the reasonable satisfaction ofFannie Maeand Freddie Mac; and (e) the satisfaction by ServiceI' of such other obligations as are set forth in the Agreement.

3


C. The conditions precedent to the payment by Fannie Mae of the Purchase Price with respect to the Services describedon the Additional Service Schedules (if any) are: (a) the execution and delivery of the Additional Service Schedules and theCe.tification by Servicer to Fannie Mae; (b) the execution and delivery ofthe Additional Service Schedules by Fannie Mae toServicer; (c) the delivery of copies of the fully executed Additional Service Schedules to Treasury; (d) the performance byServicer of the Services described in the Agreement, in accordance with the terms and conditions thereof, to the reasonablesatisfaction ofFannie Mae and Freddie Mac; and (e) the satisfaction by Servicer of such other obligations as are set fOlth in theAgreement.

D. Solely in its capacity as the financial agent of the United States, and subjectto subsection E. below, Fannie Mae shallremit all payments described in the Program Documentation to ServiceI' for the account or credit of Servicer, Investors andborrowers, in each case in accordance with the Program Documentation (all such payments, collectively, the "PurchasePrice"); all payments remitted to Servicer for the credit or account of third parties under the Program Documentation shall beapplied by Servicer as required by the Program Documentation. Fannie Mae shall have no liability to Servicer with respect tothe payment ofthe Purchase Price, unless and until: (a) Servicer and all other interested parties have satisfied all pre-requisitesset fOlth herein and in the Program Documentation relating to the applicable Program payment structure, including, but notlimited to, the delivery ofall data elements required by Section 3 ofthis Commitment; and (b) the TreasUlY has provided fundsto Fannie Mae for remittance to Servicer, together with written direction to remit the funds to Servicer in accordance with theProgram Documentation.

E. The Purchase Price will be paid to Servicer by Fannie Mae as the financial agent of the United States as and whendescribed herein and in the Program Documentation in consideration for the execution and delivery ofthe Financial Instrumentby Servicer on or before the Effective Date of the Agreement, upon the satisfaction of the conditions precedent to paymentdescribed in this Section 4.

F. The value ofthe Agreement is limited to $316,300,000.00 (the "Program PaIticipation Cap"). Accordingly, the aggregatePurchase Price payable to Servicer under the Agreement with respect to all Services described on all of the Service Schedulesthat are executed and delivered in connection with the Agreement may not exceed the amount of the Program Pa.ticipationCap. For each Service to be performed by Servicer, the aggregate remaining Purchase Price available to be paid to Servicerunder the Agreement will be reduced by the maximum Purchase Price potentially payable with respect to that Service. In theevent the Purchase Price actually paid with respect to that Service is less than the maximum Purchase Price potentiallypayable, the aggregate remaining Purchase Price available to be paid to Servicer under the Agreement will be increased by thedifference between such amounts. Notwithstanding the foregoing, no agreements with any party that may result in a newpayment obligation under the Programs will be effected under the Agreement, and no payments will be made with respect toany new Services, from and after the date on which the aggregate Purchase Price paid or payable to Servicer under theAgreement equals the Program Participation Cap. Treasury may, from time to time in its sole discretion, adjust the amount ofthe Program PaIticipation Cap. Servicer will be notified of all adjustments to the Program Participation Cap in writing byFannie Mae.

G. Servicer shall maintain complete and accurate records of, and supporting documentation for, all Services provided inconnection with the Programs including, but not limited to, data relating to borrower payments (e.g., principal, interest, taxes,homeowner's insurance, hazard insurance, flood insurance and homeowner's association and/or condo fees), delinquencies andthe terms ofeach agreement executed under the Programs (e.g., trial modification agreements, loan modification agreementsand extinguishment agreements), which will be relied upon by Fannie Mae when calculating, as financial agent for the UnitedStates, the Purchase Price to be paid by the Treasuty through Fannie Mae or any other financial agent. Servicer agrees toprovide Fannie Mae and Freddie Mac with documentation (including copies of executed borrower agreements) and otherinformation with respect to any amounts paid by the TreasUlY as may be reasonably requested by such parties. In the event ofa discrepancy or error in the amount of the Purchase Price paid hereunder, at Fannie Mae's election, (x) Servicer shall remit toFannie Mae the amount of any overpayment within thhty (30) days of receiving a refund request from Fannie Mae, or (y)Fannie Mae may immediately offset the amount of the overpayment against other amounts due and payable to Servicer byFannie Mae, as financial agent ofthe United States, upon written notice to Servicer. Servicer shall still be obligated to credit

4


to the respective accounts ofInvestors and bOl'rowers any pOltion of the Purchase Price to which they are entitled (if any)notwithstanding such offset unless otherwise directed by Fannie Mae.

H. At the election and upon the direction of the Treasury and with prior written notice to Servicer, Fannie Mae may deductfrom any amount to be paid to Servicer any amount that Servicer, Investor, or borrower is obligated to reimburse a'· pay to theUnited States government, provided, however, that any amount withheld under this subsection H. will be withheld only fromthe amounts payable to, or for the account or credit of, the palty which is liable for the obligation to the United Statesgovernment.

S. Term

A. New Services may be undertaken by ServiceI' as described in the Financial Instrument and the Program Documentationfrom and after the Effective Date until December 31, 2012 (the "Initial Term"), subject to one or more extensions ofthe InitialTerm by the Treasury, or earlier termination of the Agreement by Fanp.ie Mae pursuant to the provisions hereof, or earliersuspension or termination of one or more of the Programs by the Treasury, provided, however, no new Services may beundertaken by Serv icer, and Servicer will have no fwther obligation to perform any Services under this Agreement, from andafter the date on which the Program Patticipation Cap is reached.

B. Servicer shall perform the Services described in the Program Documentation in accordance with the terms and conditionsofthe Agreement during the Initial Term and any extensions thereof(the Initial Term, together with all extensions thereof, ifany, the "Term"), and during such additional period as may be necessary to: (i) comply with all data collection, retention andrepolting requirements specified in the Program Documentation during and for the periods set forth therein; and (ii) completeall Services that were initiated by Servicer, including, but not limited to, the completion ofall documentation relating thereto,during the Term. Servicer agrees that it will work diligently to complete all Services as soon as reasonably possible after theend of the Term or earlier termination.

C. Notwithstanding Sections 5.A. and 5.B., if the Servicer has elected to participate in the Second Lien Modification Programby executing atld delivering to Fannie Mae a Service Schedule relating thereto, the ServiceI' in its discretion, may elect to optout of the Second Lien Modification Program on an annual basis by providing notice to Fannie Mae in accordance withSection 9 hereof within 30 days following the anniversary of the Effective Date of the Service Schedule for the Second LienModification Program. Following the Servicer's election to opt out of the Second Lien Modification Program, the Servicerwill not be required to perform any Services for any new mortgage loans under the Second Lien Modification Program;however, the Servicer must continue to perform any Serv ices for any mortgage loan for which it had already begun performingServices prior to electing to opt out of the Second Lien Modification Program.

D. The Agreement, or any ofthe Programs implemented under the Agreement, may be terminated by Fannie Mae or Servicerprior to the end of the Term pursuant to Section 6 below.

6. Defaults, Aets of Bad Faith and Early Termination; Remedies for and Effeets of Defaults, Acts of Bad Faith andEarly Termination; Opportunity to Cnre

A. The following constitute events of default by ServiceI' under the Agreement (each, an "Event ofDefault" and, collectively,"Events of Default"):

(1) ServiceI' fails to perform or comply with any ofits material obligations under the Agreement,including, but not limited to, circumstances in which ServiceI' fails to ensure that all eligibilitycriteria and other conditions precedent specified in applicable Program Documentation aresatisfied prior to effectuating any Services in connection with any of the Programs.

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(2) ServiceI': (a) ceases to do business as a going concern; (b) makes a general assignment for thebenefit of, 01' enters into any arrangement with creditors in lieu thereof; (c) admits in writing itsinability to pay il' debts as they become due; (d) files a voluntary petition under any bankruptcyor insolvency law or files a voluntary petition under the reorganization or arrangement provisionsofthe laws of the United States or any other jurisdiction; (e) authorizes, applies for 01' consents tothe appointment of a trustee or liquidator of all or substantially all of its assets; (I) has anysubstantial paIt of its property subjected to a levy, seizure, assignment 01' sale fOl' 01' by anycreditor or governmental agency; or (g) enters into an agreement 01' resolution to take any of theforegoing actions.

(3) ServiceI', any employee 01' contractor ofService1', or any employee or contractor ofServicers'contractors, commits a grossly negligent, willful 01' intentional, or reckless act (including, but notlimited to, misrepresentation 01' fraud) in connection with any of the Progrmns 01' the Agreement.

(4) Any representation, warranty, or covenant made by ServiceI' in the Agreement or anyCettification is or becomes materially false, misleading, incorrect, 01' incomplete.

(5) An evaluation of performance that includes any specific findings by Freddie Mac, in its salediscretion, that Servicer's performance under any performance criteria established pursuant toapplicable Program Documentation is materially insufficient, 01' any failure by ServiceI' to complywith any directive issued by Fannie Mae or Freddie Mac with respect to documents or datarequested, findings made, or remedies established, by Fannie Mae and/or Freddie Mac inconjunction with such performance criteria or other Program requirements.

B. Fannie Mae may take any, all, 01' none ofthe following actions upon an Event ofDefault by ServiceI' under the Agreement:

(I) Fannie Mae may: (i) withhold some or all ofthe Servicer's portion ofthe Purchase Price until,in Fannie Mae's determination, Servicel' has cured the default; and (ii) choose to utilize alternativemeans of paying any pOltion of the Purchase Price for the credit 01' account of bOl'rowers andInvestors and delay paying such pOltion pending adoption of such alternative means.

(2) Fannie Mae may: (i) reduce the amounts payable to ServiceI' under Section 4; and/OI' (ii) obtainrepayment of prior payments made to ServiceI' under Section 4, provided, however, Fannie Maewill seek to obtain repayment of prior payments made under Section 4 only with respect toServices that are determined by Fannie Mae or Freddie Mac to have been impacted by, 01' thatFannie Mae or Freddie Mac believes may have been, or may be, impacted by, the Event of Defaultgiving rise to the remedy.

(3) Fannie Mae may require ServiceI' to submit to additional Program administrator oversight,including, but not limited to, additional compliance controls and quality control reviews.

(4) Fannie Mae may terminate the Agreement and cease its performance hereunder, or cease itsperformance hereunder as to any Pl'Ogram in which ServiceI' is a participant.

(5) Fannie Mae may require ServiceI' to submit to information and reporting with respect to itsfinancial condition and ability to continue to meet its obligations under the Agreement.

C. The following constitute acts of bad faith of Investors and borrowers in connection with the Programs (each, an "Act ofBad Faith" and, collectively, "Acts of Bad Faith"): an Investor or bOl'l'ower commits a grossly negligent, willful 01'

intentional, or reckless act (including, but not limited to, misrepresentation or fraud) in connection with any ofthe Programs

6


(including, but not limited to, in connection with such Investor's or borrower's response to Program questionnaires, theexecution or delivery to Servicer, Fannie Mae, or Treasury ofany ofthe agreements relating to such Investor's or borrower'sparticipation in any of the Programs and the production of supporting documentation therefor and in connection with anyaudit or review by Freddie Mac for Investor or borrower compliance with the Programs). For brevity, any such Investor orborrower is referred to in this subsection as a "defaulting party" or as a "defaulting" Investor or borrower and the Act ofBadFaith by such Investor Or borrower as a "default."

D. Fannie Mae may take any, all, or none ofthe following actions ifan Act ofBad Faith involving an Investor 01' a borl'Oweroccurs, or is reasonably believed by Fannie Mae to have occurred, in connection with any of the Programs:

(I) Fannie Mae may withhold all or any portion ofthe Purchase Price payable to, or for the creditor account of, the defaulting party until, in Fannie Mae's determination, the default has been curedor otherwise remedied to Fannie Mae's satisfaction.

(2) Fannie Mae may: (i) reduce the amounts payable to ServiceI' for the credit, or account of, thedefaulting party under Section 4; and/or (ii) obtain repayment of prior payments made to or for thecredit or account of the defaUlting party under Section 4. ServiceI' will reasonably cooperate with,and provide reasonable supp0l1 and assistance to, Fannie Mae and Freddie Mac in connection withtheir respective roles and, in Fannie Mae's case, in connection with its eff0l1s to obtain repaymentof prior payments made to Investors and bOJTowers as provided in this subsection.

(3) Fannie Mae may require ServiceI' to submit to additional Program administrator oversight,including, but not limited to, additional compliance controls and quality control reviews.

(4) Fannie Mae may cease its performance hereunder as to some 01' all of the Services subject tothe Agreement that relate to the defaulting Investor or borrower.

(5) Fannie Mae may terminate the Agreement and cease its performance hereunder ifActs of BadFaith occur on a recurring basis, are widespread among the Investor or borrower bases served byServicer, or occur in combination 01' in connection with one or more Events of Default byServicer.

E. In addition to the termination rights set forth above, Fannie Mae may terminate the Agreement 01' any Program implementedunder the Agreement immediately upon written notice to Servicer:

(I) at the direction of the Treasury;

(2) in the event of a merger, acquisition, or other change of control of ServiceI';

(3) in the event that a receiver, liquidator, trustee, or other custodian is appointed for the ServiceI'; 01'

(4) in the event that a material term of the Agreement is determined to be prohibited or unenforceable asreferred to in Section 1I.C.

F. The Agreement will terminate automatically:

(I) in the event that the Financial Agency Agreement, dated Februaty 18,2009, by and betweenFannie Mae and the Treasury is terminated; or

(2) upon the expiration 01' termination of all of the Programs implemented under the Agreement.

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G. The effects of the expiration or termination of the Agreement are as follows:

(I) In the event that the Agreement expires at the end ofthe Initial Term or any extension thereofpursuantto Section 5, or in the event that the Agreement expires or is terminated pursuant to Section 6.E. or 6.F.,Fannie Mae shall, solely in its capacity as the financial agent of the United States, continue to remit allamounts that are properly payable pursuant to Section 4 to Servicer in accordance with the ProgramDocumentation until paid in full, provided, however, that Purchase Price payments will be made only withrespect to Services that were performed in accordance with the applicable Program Documentation prior tothe date of expiration or termination and that do not exceed the Program Pmticipation Cap.

(2) In the event that the Agreement is terminated in connection with an Event of Default by Servicer, nocompensation with respect to any Service will be paid to Servicer for the account of the Servicersubsequent to termination; Fannie Mae's only continuing obligations as financial agent of the UnitedStates subsequent to termination will be to remit all payments that are properly payable pursuant to Section4 to Servicer (or, at Fannie Mae's discretion, an alternative provider) for the account of borrowers andInvestors in accordance with the Program Documentation until paid in full.

(3) In the event that the Agreement is terminated in connection with an Act ofBad Faith by an Investor ora borrower, no compensation with respectto any Services will be paid to Servicer for the credit or accountofthe defaulting Investor or borrower subsequent to termination; Fannie Mae's only continuing obligationas financial agent of the United States subsequent to termination will be to remit all payments that areproperly payable pursuant to Section 4 to Servicer for the credit or account of non-defaulting pmties asdescribed in the applicable Program Documentation until paid in fulL For the avoidance of doubt, iftheAct of Bad Faith resulting in the termination of the Agreement occurs in connection with an Event ofDefault ofServicer, no compensation with respect to any Service will be paid to Servicer for the accountofthe Servicer subsequent to termination.

H. Fannie Mae, in its capacity as the financial agent ofthe United States, may reduce the amounts payable to ServiceI' underSection 4, or obtain repayment of prior payments made under Section 4, in connection with: (a) an evaluation ofServicer'sperformance that includes any specific findings by Freddie Mac that Servicer's performance under any performance criteriaestablished pursuant to the Program Documentation is materially insufficient, or (b) any failure by Servicer to complymaterially with any directive issued by Fannie Mae or Freddie Mac with respect to documents or data requested, findingsmade, or remedies established, by Fannie Mae and/or Freddie Mac in conjunction with such performance criteria or otherProgram requirements; provided, however, Fannie Mae will seek to obtain repayment ofprior payments made under Section 4only with respect to Services that are determined by Fannie Mae or Freddie Mac to have been impacted by, or that Fannie Maeor Freddie Mac believes may have been, or may be, impacted by, the findings giving rise to this remedy. Fannie Mae mayinitially avail itself of this remedy in lieu of a specific declaration of an Event of Default, provided, however, that doing soshall not preclude Fannie Mae from later declaring an Event of Default or exercising any other rights or remedies othelwiseavailable to it under this Section 6, 01' at law or in equity, in connection with the event giving rise to this remedy, or any futureevents giving rise to this remedy.

I. The remedies available to Fannie Mae upon an Event ofDefault and an Act ofBad Faith under this Section are cumulativeand not exclusive; fUliher, these remedies are in addition to, and not in lieu of, any other remedies available to Fannie Mae atlaw or in equity.

J. In the event ofthe expiration or termination of the Agreement or any Program implemented under the Agreement under anycircumstances, Servicer and Fannie Mae agree to cooperate with one another on an ongoing basis to ensure an effective andorderly transition or resolution ofthe Services, including the provision ofany information, repOlting, records and data requiredby Fannie Mae and Freddie Mac.

8


K. Ifan Event ofOefuult under Section 6.A.1., Section 6.Ao4., or Section 6.A.5. occurs and Fannie Mae determines, in its solediscretion, that the Event ofOefault is curable and elects to exercise its right to terminate the Agreement, Fannie Mae willprovide written notice ofthe Event ofOefaultto Servicer and the Agreement will terminate automatically thirty (30) days afterServicer's receipt of such notice, ifthe Event ofOefault is not cured by Servicer to the reasonable satisfaction of Fannie Maeprior to the end ofsuch thirty (30) day period. IfFannie Mae determines, in its sole discretion, that an Event ofOefault underSection 6.A.1., Section 6.Ao4., or Section 6.A.5. is not curable, or ifan Event ofOefault under Section 6.A.2. or Section 6.A.3.occurs, and Fannie Mae elects to exercise its right to terminate the Agreement under Section 6.Bo4., Fannie Mae will providewritten notice oftennination to the Servicer on or before the effective date of the termination.

7. Disputes

Fannie Mae and Servicer agree that it is in their mutual interest to resolve disputes by agreement. Ifa dispute arises under theAgreement, the parties will use all reasonable efforts to promptly resolve the dispute by mutual agreement. Ifa dispute cannotbe resolved informally by mutual agreement at the lowest possible level, the dispute shall be referred up the respective chain ofcommand of each party in an attempt to resolve the matter. This will be done in an expeditious manner. Servicer shallcontinue diligent performance ofthe Services pending resolution ofany dispute. Fannie Mae and Servicer reserve the right topursue other legal or equitable rights they may have conceming any dispute. However, the parties agree to take all reasonablesteps to resolve disputes intemally before commencing legal proceedings.

8. Transfer or Assignment; Mergers, Acquisitions and Changes of Control; Effects of Assignment

A. Mortgage loans and servicing rights are fi'eely transferable under this Agreement, subject to: (i) the contractualrequirements regarding notice and the execution and delivery ofthe Assignment and Assumption Agreement, in the form ofExhibit 0, set forth in Sections 8 and 9 hereof, and (li) any restrictions under applicable Federal, state and local laws,regulations, regulatory guidance, statutes, ordinances, codes and requirements. ServiceI' must provide written notice to FannieMae and Freddie Mac pursuant to Section 9 below of: (i) any transfers or assignments of mortgage loans, or servicing rightsrelating to mortgage loans, that are 60 or more days delinquent and otherwise eligible for consideration or process under one ormore of the Programs at the time of transfer or assignment, or for which the Servicer is performing Services at the time oftransfer or assignment (collectively, "Eligible Loans"); and (ii) any other transfers or assignments ofServicer's rights andobligations relating to Eligible Loans under this Agreement, including, but not limited to, transfers or assignments ofany rightsor obligations relating to Eligible Loans under this Agreement that occur in connection with the merger, acquisition, or otherchange of control ofServicer. Such notice must include payment instructions for payments to be made to the transferee orassignee ofthe Eligible Loans, servicing rights or other rights and obligations subject to the notice (if applicable), and, subjectto Section 8.B. below, evidence of the assumption by such transferee or assignee of the Eligible Loans, servicing rights orother rights and obligations that are transferred, in the form of Exhibit 0 (the "Assignment and Assumption Agreement").ServiceI' acknowledges that Fannie Mae will continue to remit payments to ServiceI' in accordance whh Section 4 for Servicesrelating to mOltgage loans, servicing rights or other rights and obligations that have been assigned or transferred, and thatServicer will be liable for underpayments, overpayments and misdirected payments, unless and until such notice and anexecuted Assignment and Assumption Agreement are provided to Fannie Mae and Freddie Mac.

B. Servicer shall notify Fannie Mae as soon as legally possible of any proposed merger, acquisition, or other change ofcontrol ofServicer, and of any financial and operational circumstances which may impair Servicer's ability to perform itsobligations under the Agreement, in accordance with Sections 8 and 9, provided, however, that Servicer need not execute anddeliver an Assignment and Assumption Agreement in the form ofExhibit 0 in the event that the assignment and assumptionoccur by operation of law in connection with a merger, acquisition, or other change ofcontrol ofServicer and are effective asto all of Servicer's rights and obligations under this Agreement with respect to all of the mOltgage loans it services.

C. The effects of transfers and assignments under this Agreement are as follows:

9


(I) If the ServiceI' transfers or assigns all or any pOltion of its pOltfolio of mOltgage loans or servicingrights to a third patty pursuant to an Assignment and Assumption Agreement, only the Eligible Loans mustbe identified on a schedule to the Assignment and Assumption Agreement. The transferee or assignee ofServicer's mOltgage loans and servicing rights must assume Servicer's obligations under this Agreementonly with respect to Eligible Loans, subject to the Service Schedules and the Program Documentationapplicable to the Programs in which ServiceI' agreed to patticipate prior to the transfer or assignment. Anymortgage loans or servicing rights that (I) at'e not Eligible Loans atthe time ofthe transfer or assignment, (11)are a part of the transferee's or assignee's existing portfolio prior to the transfer or assignment, or (Ill)become a part of the transferee's or assignee's pOltfolio subsequent to such transfer or assignment willbecome subject to the Programs only if the transferee or assignee has itself executed a Commitment toPurchase Financial Instrument and ServiceI' Patticipation Agreement separate and apart from the transfer orassignment involving Servicer and, then, only in accordance therewith.

(2) Ifthe ServiceI' transfers or assigns its pOltfolio ofmOltgage loans and serv icing rights to a third pattyin connection with a merger, acquisition, or other change of control and the transfer or assignment iseffective by operation oflaw, the transferee or assignee ofsuch mottgage loans and servicing rights mustprovide servicing with respect to all such mOltgage loans and servicing rights (regardless ofstatus at the timeof transfer or assignment with respect to Program eligibility) in accordance with this Agreement, subject tothe Service Schedules and the Program Documentation applicable to the Progratns in which ServiceI' agreedto participate prior to the transfer or assignment. Any mOltgage loans or servicing rights that (I) are a part ofthe transferee's or assignee's existing pOltfolio prior to the transfer or assignment, or (11) become a part ofthe transferee's or assignee's portfolio subsequent to such transfer or assignment will become subject to thePrograms only if the transferee or assignee has itself executed a Commitment to Purchase FinancialInstrument and ServiceI' Patticipation Agreement separate and apart from the transfer or assignmentinvolving Servicer and, then, only in accordance therewith.

(3) ServiceI' may not transfer or assign any mOltgage loans or servicing rights to any third party in amanner that is intended to circumvent, or has the effect of circumventing, Servicer's obligations under thisAgreement.

9. Notices

All legal notices under the Agreement shall be in writing and referred to each party's point ofcontact identified below at theaddress listed below, or to such other point ofcontact at such other address as may be designated in writing by such patty. Allsuch notices under the Agreement shall be considered received: (a) when personally delivered; (b) when delivered by commercial overnight courier with verification receipt; (c) when sent by confirmed facsimile; or (d) tluee (3) days after having beensent, postage prepaid, via celtified mail, return receipt requested. Notices shall not be made or delivered in electronic form,except as provided in Section 12.B. below, provided, however, that the party giving the notice may send an e-mail to the partyreceiving the notice advising that party that a notice has been sent by means pel'milled under this Section.

To Servicer:

~. • I • ~~. '. I eLLC

350 Highland DriveLewisville, Texas 75067

10


To Fannie Mae:

Fannie Mae3900 Wisconsin Ave, NWWashington, DC 20016

To Treasury:

Department ofTreasury1500 Pennsylvania Avenue, NW

~To Freddie Mac:

Freddie Mac8100 Jones Branch DriveMcLean, VA 22102Attn: Vice President, Making Home Affordable - ComplianceFacsimile: (703) 903-2544Email: [email protected]

10. Modifications

A. Subject to Sections IO.B. and 10.C., modifications to the Agreement shall be in writing and signed by Fannie Mae andServiceI'.

B. Fannie Mae and the Treasury each reserve the right to unilaterally modify or supplement the terms and provisions of theProgram Documentation that relate (as determined by Fannie Mae or the Treasury, in their reasonable discretion) to thecompliance and performance requirements of the Programs, and related remedies established by Freddie Mac, and/or totechnical, administrative, or procedural matters or compliance and reporting requirements that may impact the administrationof the Programs.

C. Notwithstanding Sections 10.A. and 10.B., any modification to the Program Documentation that materially impacts theborrower eligibility requirements, the amount of payments of the Purchase Price to be made to Pmticipating Servicers,Investors and borrowers under any of the Programs in which Servicer palticipates, or the rights, duties, or obligations ofParticipating Servicers, Investors 01' borrowers in connection with any ofthe Programs in which ServiceI' pmticipates (each, a"Program Modification" and, collectively, the "Program Modifications") shall be effective only on a prospective basis;Participating Servicers will be afforded the oppOltunity to opt-out ofa modified Program when Program Modifications arepublished with respect to the Services to be performed by Servicer in connection with the modified Program on or after the

II


effective date ofthe Program Modification, at Servicer's discretion. Opt-out procedures, including, but not limited to, the timeand process for notification of election to opt-out and the window for such election, will be set forth in the ProgramDocumentation describing the Program Modification, provided, however, that ServiceI' will be given at least thirty (30) days toelect to opt-out ofa Program Modification. For the avoidance ofdoubt, during the period during which ServiceI' may elect toopt-out of a Program Modification and after any such opt-out is elected by Servicer, ServiceI' will continue to perform theServices described in the Financial Instrument and the Program Documentation (as the Program Documentation existedimmediately prior to the publication of the Program Modification prompting the opt-out) with respect to any Services thatServiceI' had already begun to perform prior to the opt-out.

11. Miscellaneous

A. The Agreement shall be governed by and construed under Federal law and not the law of any state or locality, withoutreference to or application ofthe conflicts oflaw principles. Any and all disputes between the pat1ies that cannot be settled bymutual agreement shall be resolved solely and exclusively in the United States Federal cOUJ1s located within the District ofColumbia. Both pm1ies consent to the jurisdiction and venue of such courts and irrevocably waive any objections thereto.

B. The Agreement is not a Federal procurement contract and is therefore not subject to the provisions ofthe Federal Propel1yand Administrative Services Act (41 U.S.C. §§ 251-260), the Federal Acquisition Regulations (48 CFR Chapter I), or anyother Federal procurement law.

C. Any provision of the Agreement that is determined to be prohibited or unenforceable in any jurisdiction shall, as to suchjurisdiction, be ineffective to the extent ofsuch prohibition or unenforceability without invalidating the remaining provisionsofthe Agreement, and no such prohibition or unenforceability in any jurisdiction shall invalidate such provision in any otherjurisdiction.

D. Failure on the pal1 of Fannie Mae to insist upon strict compliance with any of the tellliS hereof shall not be deemed awaiver, nor will any waiver hereunder at any time be deemed a waiver at any other time. No waiver will be valid unless inwriting and signed by an authorized officer of Fannie Mae. No failure by Fannie Mae to exercise any right, remedy, or powerhereunder wilt operate as a waiver thereof. The rights, remedies, and powers provided herein are cumulative and notexhaustive of any rights, remedies, and powers provided by law.

E. The Agreement shall inure to the benefit of and be binding upon the parties to the Agreement and their permittedsuccesso 1'8-in- interest.

F. The Commitment, the Service Schedule(s) and the Assignment and Assumption Agreement (ifapplicable) may be executedin two or more counterpat1s (and by different pm1ies on separate counterpaI1s), each of which shall be an original, but all ofwhich together shall constitute one and the same instmment.

G. The Commitment, together with the Service Schedule(s), the Financial Instrument, the Cel1ifications, the Assignment andAssumption Agreement (if applicable) and the Program Documentation, constitutes the entire agreement of the pal1ies withrespect to the subject matter hereof. In the event of a conflict between any of the foregoing documents and the ProgramDocumentation, the Program Documentation shall prevail. In the event ofa conflict between the Program Guidelines and theSupplemental Directives, the Program Guidelines shall prevail.

H. Any provisions of the Agreement (including all documents incorporated by reference thereto) that contemplate theircontinuing effectiveness, including, but not limited to, Sections 4, 5.B., 6, 8, 9, 11 and 12 ofthe Commitment, and Sections 2,3,5,7,8,9 and 10 ofthe Financiallnstmment, and any other provisions (or p0l1ions thereof) in the Agreementthat relate to,or may impact, the ability of Fannie Mae and Freddie Mac to fulfill their responsibilities as agents of the United States inconnection with the Programs, shall survive the expiration or termination of the Agreement.

12


12. Defined Tenns; Incorporation by Reference; Effect of Amendment and Restatement

A. All references to the "Agreement" necessarily include, in all instances, the Commitment and all documents incorporatedinto the Commitment by reference, whether or not so noted contextually, and all amendments and modifications thereto.Specific references throughout the Agreement to individual documents that are incorporated by reference into the Commitmentare not inclusive of any other documents that are incorporated by reference, unless so noted contextually.

B. The term "Effective Date" means the date on which Fannie Mae transmits a copy ofthe fully executed Commitment, InitialService Schedule(s) and Financial Instrument to Treasury and Servicer with a completed cover sheet, in the form attachedhereto as Exhibit E (the "Cover Sheet"); the Agreement shall be effective on the Effective Date. Any Additional ServiceSchedules that are executed and delivered to Fannie Mae after the Effective Date of the Agreement shall be also beaccompanied by a completed Cover Sheet and shall be effective on the effective date or dates set faith therein. All executeddocuments and accompanying Cover Sheets will be faxed, emailed, or made available through other electronic means toTreasury and Servicer in accordance with Section 9.

C. The Program Documentation and Exhibit A - Service Schedule(s) (Service Schedule A- I, et seq.), Exhibit B - Form ofFinancial Instrument, Exhibit C - Form ofCeltification, Exhibit D - Form of Assignment and Assumption Agreement andExhibit E - Form of Cover Sheet (in each case, in form and, upon completion, in substance), including all amendments andmodifications thereto, are incorporated into this Commitment by this reference and given the same force and effect as thoughfully set fOlth herein.

D. The Prior Agreement is amended and restated in its entirety, and all ofthe terms and conditions ofthe Prior Agreement aresuperseded by the terms and conditions of this Agreement, effective as of the Effective Date of this Agreement.

[SIGNATURE PAGE FOLLOWS; REMAINDER OF PAGEINTENTlONALLY LEFT BLANK]

13


In Witness Whereof, Serviccr and Fannie Mae by their duly authorized officials hereby execute (lnd deliver this Amended andRestated Commitment to Purchase Financiallnstrul11ent and Servker Particip;ltion Agreement as of the Effective Date.

SERVICER: Nationstar Mortgage LLC

Br2tzt~tJr~l__---------Name:'7<s£C(2;[ 1-.. Aet'ii'I _Titlc: ~_--~-~:J:-"'£----------------Date: 'i~EI'L 7_'I;-kD1C> _

EXHIBITS

FANNIE MAE, solely as Financial Agent oflheUnited States

Exhibit A

Exhibit B

Exhibit C

Exhibit D

Exhibit E

Service ScheduJe(s)

Form of Financial Instrument

Porm of Certification

Form of Assignment and Assumption Agreement

Form of Cover Sheet


EXHIBIT A

SERVICE SCHEDULE(Sl

The attached Service Schedules together comprise Exhibit A to that certain Amended and RestatedCommitment to Purchase Financial Instrument and Servicer Participation Agreement (the "Commitment"),entered into as ofthe Effective Date, by and between Federal National Mortgage Association ("Fannie Mae"),a federally chartered corporation, acting as financial agent of the United States, and the undersigned palty("Servicer").

Each of the Service Schedules attached hereto is effective as of the Effective Date, or on such other date ordates as may be specified therein. All of the capitalized terms that are used but not defined in the ServiceSchedules shall have the meanings ascribed to them in the Commitment.

Exhibit A is deemed to be amended to include all Additional Service Schedules (if any) that are executed anddelivered by the palties after the Effective Date in accordance with the Agreement, without any fUlther actionon the part of the parties hereto.


SERVICE SCHEDULE A-I

This Service Schedule is appended To that cerlain Commitment to Purchase Financial Instrument and ServiceI' ParticipallonAgreement (the "Commitment"), entered into as of the Effective Date, by and belwcen Federal National Mortgage Asso.,;iation("Fannie Mae"), a federally chartered corporation, acting as tinancial agent of the United Stales, and the undersigned party("Servicer"), and, together with all other Services Schedules appendeu thereto (if any), conslilutcs Exhibill\ to the Commitment.

All (lethe capitalized terms (hat are used but not defined below shall have the meanil'lgs ascribed to them in the COlllmiUJlcnl or inapplicable Program Documentation.

I. Program Name:

Servicer hereby elects La participate in the. following Prog,'am(s):

Home Affordable Modification Program (HAMP)

2. Description of Program Services:

All services requ ired to be perfonned by a participating serviceI' as set forth in the Program Documentation forthe Home Affordable Mouificalion Program under thc Emergency Economic Stabilization Act of 2008, asamended, including, but not limited to, obligations relating to the modification offirst lien mongage loans andthe provision ofloan modification and foreclosure prevenlion serviccs relating thereto,

3. Effective date of Service Schedule:accordingly, the effective date of this Service Schedule is the Effective Date of the Agreement.

This Service Sched ule is effective as of May 28, 2009.

In Witness Whereof, Servicer and Fannie Mae by their duly authorized officials hereby execute and deliver this Service Scheduleas of the effective date of the Service Schedu Ie set forth above.


A-I

FANNIE MAE, solely as Financial Agent of the UnitedStates


SERVICE SCHEDULE A-2

This Service Schedule is appended to that eertain Commitment to Purchase Financial Instrument and ServiceI' ParticipalionAgreement (Ihe "Commitment"), entered into f\S of the Effective Date, by and between Federal National Mortgage Association("Fannie Mae"), a federally chartered corporation. acting as []nancial agent of the United Stales, find the undersigned party("ServiceI'"), <'Ind, together with all other Services Schedules appended thereto (if ony), conslituLes Exhibit A to the Comm itmcnt.

All of the capitalized terms thal ore used but not defined below shall have the meanings ascribed 10 them in the Commitment or inapplicable Program Documentation.

1. Program Name:

ServiceI' hereby elects to participate in [he following Program(s):

Second Lien Modification Program


All services required to be performed by a participating ~:lervicer as set forth in the Program Documentation for(he Second Lien Modification Program under the Emergency Economic Stabilization Act of2008, as amended,including, bUl not limited to, ohligations relating to the modification or extinguishment ofsecond lien mortgageloans and the provision ofloan modification and foreclosure prevention services relating thereto.

3. Effective date of Service Schedule:

This Service Scbedule is executed and delivered contemporaneously with the Commitment; accordingly,the effective date of this Service Schedule is the Effective Date of the Agreement.

In Witness Whereof, Servicer and Fannie Mae by their duly authorized officials hereby execute and deliver this Service Scheduleas of the effective date of the Service Schedule set fonh above.


A-2


BY:~~Name~Title:-=:v!" ; ~IDate: .. --.-1~p"'·-f-l-LL-~~


SERVICE SCHEDULE A-3

This Service Schedule is appended Lo thaI certain Amended and Restated Commitment to Purcha:lc Financial Instrument andServicer Participation Agreement (the "Commitment"), entered into as of the Effective Date, by and bel ween Federal NationalMortgage Association ("Fannie Mae"), a federally chartered corpormion, acting as financial agent of the United States, and [heulldersigned parly ("S~r\,jcer"), and, togeth~1' with all other Services Schedules appended thereto (ifany), conslitutes Exhibit A 10the Commitment.

All of the capitalized (erms that are used but not defined below shall have the meanings ascrihed 10 them in the Commitment or inapplicftble Program Documentation.

1.. Program NAme:

Servicer hereby elects to participate in the following Progrnm(s):

Treasury Federal Housirlg Administration - Home Affordable Modificatlorl Program (Treasury FIIAHAMP)


A11 service:'! require.d to be performed by (I participating servicer relating to Trea:'!ury FHA·HAMP, as set forthin guidance issued by the Federal Housing Administration from time to time; including Morlgagce Leller 200923,2009-35,2009-39,2010-04 and 201 O~ 10, flnd in the Program Documentation for including Treasury FHAHAMP in the Home Affordable Modification Program under the Emergency Economic Stabilization Act of2008, as amended, including, but not limited 10, obligations relating to the modification of first lien mortgageloans insured by the Federal Housing Administration and the provision of loan modification and foreclosurepl'eventioll services relating thereto,

3. Effective date of Service Schedult~:

This Service Schedule is executed and delivered contemporaneously with the Commitment; attordingly,the effective date of this Service Schedule is the Effective Date of the Agreemeut.

In Witness Whereof, Servicer and Fannie Mae by their duly authorized officials hereby execute and deliver this Service Scheduleas of the effective date of the Service Schedule set forth above.

SERVICER, Nationstar Mortgage LLC

A-3



SERVICE SCHEDllLE A·4

This Service Schedule is appended to thal certain Amended and Restated Commiunent to PurchaseFinancial Instrument and Servicer Participation Agreement (the "Commitment"), entered into as of theEffective Date. by and between Federal National Mortgage Association ("Fannie Mae"), a federallychartered corporation, acting as financial agent of the United Slates, and the undersigned party ("Servicer"),and, together with 1'\11 other Services Schedules appended thereto (if any), constitutes Exhibit A to theCommitment.

All of the capitalized terms that are used but not defined below shall have the meanings ascribed to them inlhe Commitment or in applicable Program Documentatioll.

1. Program Name:

Servicer hereby elects to participate in the following Program(s):

Treasury/FHA-Second Lien Program (FHA2LP)


All services required to be performed by a participating servicer relating to FHA2LP, as set forthin the Program Documentation for FHA2LP in the Making Home Affordable Program under theEmergency Economic Stabilization Act of2008, as amended.


This Service Schedule is executed and delivered contemporaneously with the Commitment;accordingly, the effective date of this Service Schedule is the Effective Date of theAgreement.

4. OJ)t~Out Right:

for the avoidance of doubt, issuance of an FHA2LP Program Modification requiring mandatorysecond lien principal forgiveness shall afford Servicer the opportunity to opt·out of FHA2LP inaccordance with section to.c. of the Agreement. Servicer shall have thirty (30) calendar daysfrom the date any such Program Modification is published to make an opt·out election.

lo Witness Whereof, Servicer and Fannie Mae by their duly authorized officials hereby execute anddeliver this Service Schedule as of the effective date of the Service Schedule set forth above.

FANNIE MAE, solely as Financial Agentof the United States

"'~Name: ,s-Title:~4"refDale: (1 0e: _

By:Nam-f,F----*->o""

Tit~_--"L-""'.Ll-!:'--'='--'-'--- _

SERVICER: Natiollstar Mortgage LLC

Confidential· Internal Distribution


SERVICE SCHEDULE A·S

This Service Schedule is flppended to that cCI1ain Amendeu and Reslflled Commitment 10 Purchase Financial Instrument andServiceI' Participation Agleemenl (the "Commitment"), entered into as of Ihe Effective Date, by and bClwecll FeJeral NationalMortgage Association ("Fannie Mae"), a federally chartered corporation, acting 1l:l financial agent oflhe Uniled Slates, and theundersigned party ("Servicer"). and, together wlfh all other Services Schedules f1ppcndeJ thereto (if any), constitutes Exhibit 8. tothe Commitment.

All of the capitalized terms that me used but not defined below shall have the meanings ascribed 10 them in the Commitment or inapplicahle Program Documentation.

1. Program Name:

Sl::rvicer hereby elects to participate in the following Program(s}:

US Department of Agriculture - Rural Housing Service Home Affordable Modific~tionProgram (RDHAMP)

2. Dcscription of Program Services:

All services required to be performed by a participating scrvicer rclating to RDMHAMP, as set forth in guidancci::>sucd hy the Rural Housing Service (Rl-IS) from time to time; including the final rule publishc.d on RHS'sGuaranteed Single Family Housing Loans in 75 FR 52,429, August 26, 2010, and in the ProgramDocumentation for inclu(hngRD~HAMP in the Home Affordahle Modification Program under the EmergencyEconomic Stabilization Act of 2008, as amended. incluJing, but not limited to. ohligatiolls relating to themodification of first lien mortgage loans insured by RHS anJ the provision of loan modification andforeclosure prevention services I'elaling thereto.


Tbis Servke Schedule is executed and delivered contemporaneously with the Commitment; Accordingly,the effective dBte of this Service Schedule is the Effective Date of the Agreement.

In Witness Whercof, Servicer and Fannie Mae by their duly aUlhorizell offIcials hereby execute and deliver this Service Scheduleas of the effective date of the Scrvice Schedule set forth above.

By:


'/41- ;( tJ~Zk(Name: • 1<.0 r~ "P.T L. 1+ fr! f'LTitle:__ l::V PT-,~""':t:C1d0G

Date: Set'z: z..~ 2.£;' Ie.

A·S

FANNIE MAE. solely as Financial Agent oflhe UnitedStntes

'''~~-----Name: •Title:~~Date: ~_ __._


EXHIBITB

FORM OF FINANCIAL INSTRUMENT


FINANCIAL INSTRUMENT

This Financial Instrument is delivered as provided in Section I ofthe Amended and Restated Commitment to PurchaseFinancial Instrument and ServiceI' Participation Agreement (the "Commitment"), entered into as ofthe Effective Date,by and between Federal National Mortgage Association ("Fannie Mae"), a federally chaltered corporation, acting asfinancial agent ofthe United States, and the undersigned Palty ("Servicer"). This Financial Instrument is effective asof the Effective Date. All of the capitalized terms that al'e used but not defined herein shall have the meaningsascribed to them in the Commitment.

For good and valuable consideration, the receipt and sufficiency ofwhich is hereby acknowledged, ServiceI' agrees asfollows:

1. Purchase Price Consideration: Services. This Financial Instrument is being purchased by Fannie Maepursuant to Section 4 ofthe Commitment in consideration for the payment by Fannie Mae, in its capacity as afinancial agent ofthe United States, ofvarious payments detailed in the Program Documentation and referredto collectively in the Commitment as the "Purchase Price."

(a) The conditions precedent to the payment by Fannie Mae ofthe Purchase Price with respectto theServices described on the Initial Service Schedules are: (i) the execution and delivery of thisFinancial Instrument, the Commitment and the Initial Service Schedules by Servicel' to FannieMae; (ii) the execution and delivery of the Commitment and the Initial Service Schedules byFannie Mae to Servicer; (iii) the delivery of copies of the fully executed Commitment, InitialService Schedules and Financial Instrument to Treasury on the Effective Date ofthe Agreement;(iv) the performance by ServiceI' of the Services described in the Agreement; and (v) thesatisfaction by Servicer ofsuch other obligations as are set fOlth in the Agreement. ServiceI' shallperform all Services in consideration for the Purchase Price in accordance with the terms andconditions of the Agreement, to the reasonable satisfaction of Fannie Mae and Freddie Mac.

(b) The conditions precedent to the payment by Fannie Mae ofthe Purchase Price with respect to theServices described on the Additional Service Schedules (if any) are: (i) the execution anddelivery ofthe Additional Service Schedules and the Certification by Servicer to Fannie Mae; (ii)the execution and delivery of the Additional Service Schedules by Fannie Mae to Servicer; (iii)the delivery of copies of the fully executed Additional Service Schedules to Treasury; (iv) theperformance by ServiceI' of the Services described in the Agreement, in accordance with theterms and conditions thereof, to the reasonable satisfaction ofFannie Mae and Freddie Mac; and(v) the satisfaction by ServiceI' of such other obligations as are set fOlth in the Agreement.

2. Authority and Agreement to Palticipate in Program. Subject to the limitations set fOlth in Section 2 of theAgreement, ServiceI' shall use reasonable effOlts to remove all prohibitions or impediments to its authorityand to obtain all third party consents, waivers and delegations that are required, by contract or law, in order toperfOlm the Services.

3. Audits, Reporting and Data Retention.

(a) Freddie Mac, the Federal Housing Finance Agency and other parties designated by the Treasuryor applicable law shall have the right during normal business hours to conduct unannounced,informal onsite visits and to conduct formal onsite and offsite physical, personnel andinformation technology testing, security reviews, and audits of Servicer and to examine allbooks, records and data related to the Services prov ided and Purchase Price received inconnection with each of the Programs in which ServiceI' participates on thirty (30) days' priorwritten notice.

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(b) Servicer' will collect, record, retain and provide to Treasury, Fannie Mae and Freddie Mac alldata, information and documentation relating to the Programs in which ServiceI' pm1icipates asrequired by applicable Program Documentation. All such data, information and documentationmust be provided to the Treasury, Fannie Mae and Freddie Mac as, when and in the mannerspecified in applicable Program Documentation. In addition, ServiceI' shall provide copies ofexecuted contracts and tapes of loan pools related to the Programs for review upon request.

(c) ServiceI' shall promptly take cOl'I'ective and remedial actions associated with repOlling andreviews as directed by Fannie Mae 01' Freddie Mac and provide to Fannie Mae and Freddie Macsuch evidence ofthe effective implementation ofcorrective and remedial actions as Fannie Maeand Freddie Mac shall reasonably require. Freddie Mac may conduct additional reviews basedon its findings and the corrective actions taken by Servicet'o

(d) In addition to any other obi igation to retain financial and accounting records that may be imposedby Federal or state law, Servicer shall retain all information described in Section 3(h), and alldata, books, rep0l1s, documents, audit logs and records, including electronic records, related tothe performance of Services in connection with the Programs. In addition, ServiceI' shallmaintain a copy of all computer systems and application software necessary to review andanalyze these electronic records. Unless otherwise directed by Fannie Mae or Freddie Mac,ServiceI' shall retain these records for at least 7 years from the date the data or record was created,or for such longer period as may be required pursuant to applicable law. Fannie Mae or FreddieMac may also notifY ServiceI' f)'Om time to time of any additional record retention requirementsresulting from litigation and regulatory investigations in which the Treasury or any agents oftheUnited States may have an interest, and ServiceI' agrees to comply with these litigation andregulatory investigations requirements.

4. Internal Control Program.

(a) ServiceI' shall develop, enforce and review on a quarterly basis for effectiveness an internalcontrol program designed to: (i) ensure effective delivery of Services in connection with thePrograms in which ServiceI' participates and compliance with applicable ProgramDocumentation; (ii) effectively monitor and detect loan modification fraud; and (iii) effectivelymonitor compliance with applicable consumer protection and fair lending laws. The internalcontrol program must include documentation ofthe control objectives for Program activities, theassociated control techniques, and mechanisms for testing and validating the controls.

(b) ServiceI' shall provide Freddie Mac with access to all internal control reviews and repOIlS thatrelate to Services under the Programs performed by ServiceI' and its independent auditing firm toenable Freddie Mac to fulfill its duties as a compliance agent ofthe United States; a copy of thereviews and reports will be provided to Fannie Mae for record keeping and other administrativepurposes.

5. Representations. Warranties and Covenants. Service)' makes the following representations, warranties andcovenants to Fannie Mae, Freddie Mac and the Treasury, the truth and accuracy of which are continuingobligations of Servicer. In the event that any of the representations, warranties, or covenants made hereincease to be true and conect, ServiceI' agrees to notifY Fannie Mae and Freddie Mac immediately.

(a) ServiceI' is established under the laws ofthe United States or any state, tenitory, or possession ofthe United States or the District ofColumbia, and has significant operations in the United States.Servicer has fu II corporate power and authority to enter into, execute, and deliver the Agreement

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and to perform its obligations hereunder and has all licenses necessary to carryon its business asnow being conducted and as contemplated by the Agreement.

(b) Servicer is in compliance with, and covenants that all Services will be performed in compliancewith, all applicable Federal, state and local laws, regulations, regulatory guidance, statutes,ordinances, codes and requirements, including, but not limited to, the Truth in Lending Act, 15USC 160 I § et seq., the Home Ownership and Equity Protection Act, 15 USC § 1639, theFederal Trade Commission Act, 15 USC § 41 et seq., the Equal Credit OppOltunity Act, 15 USC§ 701 et seq., the Fair Credit Reporting Act, 15 USC § 1681 et seq., the Fair Housing Act andother Federal and state laws designed to prevent unfair, discriminatory or predatory lendingpractices and all applicable laws governing tenant rights. Subject to the following sentence,ServiceI' has obtained or made, or will obtain 01' make, all governmental approvals orregistrations required under law and has obtained or will obtain all consents necessary toauthorize the performance of its obligations under the Programs in which ServiceI' participatesand the Agreement. The perfOlmance of Services under the Agreement will not conflict with, orbe prohibited in any way by, any other agreement 01' statutOly restriction by which Servicer isbound, provided, however, that Fannie Mae acknowledges and agrees thatthis representation andwarranty is qualified solely by and to the extent ofany contractual limitations established underapplicable pooling and servicing agreements and other servicing contracts to which Serv icer issubject. Servicer is not aware of any other legal or financial impediments to performing itsobligations under the Programs in which ServiceI' pmticipates or the Agreement and shallpromptly notifY Fannie Mae ofany financial and/or operational impediments which may impairits ability to perform its obligations under such Programs or the Agreement. ServiceI' is notdelinquent on any Federal tax obligation or any other debt owed to the United States or collectedby the United States for the benefit of others, excluding any debt or obligation that is beingcontested in good faith.

(c) Servicer covenants that: (i) it will perform its obligations in accordance with the Agreement andwill promptly provide such performance repOlting as Fannie Mae may reasonably require; (ii) allServices will be offered to borrowers, fully documented and serviced, 01' otherwise performed, inaccordance with the applicable Program Documentation; and (iii) all data, collection informationand other information reported by Servicer to Fannie Mae and Freddie Mac under theAgreement, including, but not limited to, information that is relied upon by Fannie Mae orFreddie Mac in calculating the Purchase Price or in performing any compliance review will betrue, complete and accurate in all material respects, and consistent with all relevant businessrecords, as and when provided.

(d) Servicer covenants that it will: (i) perform the Services required under the ProgramDocumentation and the Agreement in accordance with the practices, high professional standardsofcare, and degree ofattention used in a well-managed operation, and no less than that which theServicer exercises for itself under similar circumstances; and (ii) use qualified individuals withsuitable training, education, experience and skills to perform the Services. ServiceI' acknowledgesthat Program p31ticipation may require changes to, or the augmentation of, its systems, staffingand procedures, and covenants and agrees to take all actions necessary to ensure it has thecapacity to implement the Programs in which it participates in accordance with the Agreement.

(e) ServiceI' covenants that it will comply with all regulations on conflicts of interest that areapplicable to Servicer in connection with the conduct of its business and all conflicts of interestand non-disclosure obligations and restrictions and related mitigation procedures set fOlth in theProgram Documentation (if any), as they relate to the Programs in which ServiceI' pmticipates.

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(I) ServiceI' acknowledges that the provision of false or misleading information to Fannie Mae orFredd ie Mac in connection with any of the Programs or pursuant to the Agreement mayconstitute a violation of: (a) Federal criminal law involving fraud, contlict of interest, bribery, orgratuity violations found in Title 18 ofthe United States Code; 01' (b) the civil False Claims Act(31 U.S.C. §§ 3729-3733). ServiceI' covenants to disclose to Fannie Mae and Freddie Mac anycredible evidence, in connection with the Services, that a management official, employee, orcontractor of Sel'vicer has committed, 01' may have committed, a violation of the referencedstatutes.

(g) ServiceI' covenants to disclose to Fannie Mae and Freddie Mac any other facts 01' information thatthe Treasury, Fannie Mae or Freddie Mac should reasonably expect to know about ServiceI' andits contractors to help protect the reputational interests ofthe Treasury, Fannie Mae and FreddieMac in managing and monitoring the Programs in which ServiceI' participates.

(h) ServiceI' covenants that it will timely inform Fannie Mae and Freddie Mac of any anticipatedEvent of Defau It and of any Act of Bad Faith of which it becomes aware.

(i) Servicer acknowledges that Fannie Mae or Freddie Mac may be required to assist the Treasurywith responses to the Privacy Act of 1974 (the "Privacy Act"), 5 USC § 552a, inquiries fromborrowers and Freedom of Information Act, 5 USC § 552, inquiries from other parties, as well asformal inquiries from Congressional committees and members, the Government AccountingOffice, Inspectors General and other government entities, as well as media and consumeradvocacy group inquiries about the Programs and their effectiveness. Servicer covenants that itwill respond promptly and accurately to all search requests made by Fannie Mae 01' Freddie Mac,comply with any related procedures which Fannie Mae or Freddie Mac may establish, andprovide related training to employees and contractors. In connection with Privacy Act inquiries,Servicer covenants that it will provide updated and corrected information as appropriate aboutborrowers' records to ensure that any system of record maintained by Fannie Mae on behalf ofthe Treasury is accurate and complete.

Gl Servicer acknowledges that Fannie Mae is required to develop and implement customer servicecall centers to respond to borrowers' and other paIties' inquiries regarding the Programs, whichmay require additional SUppOlt from Servicer. ServiceI' covenants that it will provide suchadditional customer service call support as Fannie Mae reasonably determines is necessary tosuPPOtt the Programs in which Servicer paIiicipates.

(k) ServiceI' acknowledges that Fannie Mae and/or Freddie Mac are required to develop andimplement practices to monitor and detect loan modification fraud and to monitor compliancewith applicable consumer protection and fail' lending laws. ServiceI' covenants that it will fullyand promptly cooperate with Fannie Mae's inquiries about loan modification fraud and legalcompliance and comply with any anti-fraud and legal compliance procedures which Fannie Maeand/or Freddie Mac may require. ServiceI' covenants that it will develop and implement aninternal control program to monitor and detect loan modification fraud and to monitorcompliance with applicable consumer protection and fuir lending laws, among other things, asprovided in Section 4 of this Financial Instrument and acknowledges that the internal controlprogram will be monitored, as provided in such Section.

(I) ServiceI' shall sign and deliver a Celtification to Fannie Mae and Freddie Mac beginning on June1,2010 and again on June 1 ofeach year thereafter during the Term, and upon the execution and

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delivery by Servicer of Additional Service Schedule(s) (if any) during the Term, in each case inthe form attached as Exhibit C to the Agreement.

(m) Solely if Servicer has elected to participate in the Second Lien Modification Program byexecuting and delivering to Fannie Mae a Service Schedule relating thereto, ServiceI' represents,warrants and covenants that each mortgage loan it modifies under the Second Lien ModificationProgram is, or will be at the time of modification, a lien that is second in priority relative to thefirst lien that was modified under the Programs.

6. Use ofContractors. ServiceI' is responsible for the supervision and management ofany contractor that assistsin the performance ofServices in connection with the Programs in which Servicer participates. ServiceI' shallremove and replace any contractor that fails to perform. ServiceI' shall ensure that all of its contractorscomply with the terms and provisions of the Agreement. Servicer shall be responsible for the acts oromissions of its contractors as if the acts or omissions were by the Serv ieer.

7. Data Rights.

(a) For purposes of this Section, the following definitions apply:

(i) "Data" means any recorded information, regardless of form or the media on which itmay be recorded, regarding any ofthe Services provided in connection with the Programs.

(ii) "Limited Rights" means non-exclusive rights to, without limitation, use, copy,maintain, modify, enhance, disclose, reproduce, prepare derivative works, and distribute, inany manner, for any purpose related to the administration, activities, review, or audit o( orpublic reporting regarding, the Programs and to permit others to do so in connectiontherewith.

(iii) "NPI" means nonpublic personal information, as defined under the GLB.

(iv) "GLB" means the Gramm-Leach-Bliley Act, 15 U.S.C. 6801-6809.

(b) Subject to Section 7(c) below, Treasury, Farmie Mae and Freddie Mac shall have Limited Rights,with respect to all Data produced, developed, or obtained by Servicer or a contractor ofServiceI'in connection with the Programs, provided, however, that NPI will not be transferred by FannieMae in violation of the GLB and, provided, fUlther, that Servicer acknowledges and agrees thatany use ofNPI by, the distribution ofNPI to, or the transfer ofNPI among, Federal, state andlocal government organizations and agencies does not constitute a violation of the GLB forpurposes of the Agreement. If requested, such Data shall be made available to the Treasury,Fannie Mae, or Freddie Mac upon request, or as and when directed by the ProgramDocumentation relating to the Programs in which Servicer paJticipates, in industry standarduseable format.

(c) Servicer expressly consents to the publication of its name as a palticipant in the Programs listedon the Sel'vice Schedules, and the use and publication of Servicer's Data, subject to applicablestate and federal laws regarding confidentiality, in any form and on any media utilized byTreasury, Fannie Mae or Freddie Mac, including, but not limited to, On any website or webpagehosted by TreasUlY, Fannie Mae, 01' Freddie Mac, in connection with such Programs, providedthat no Data placed in the public domain: (i) will contain the name, social security number, orstreet address of any borrower or othel' information that would allow the borrower to be

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identified; or, (ii) will, if presented in a form that links the ServiceI' with the Data, include (x)information other than program performance and palticipation related statistics, such as thenumber ofmodifications or extinguishments, performance of modifications, characteristics ofthemodified loans, or program compensation or fees, or (y) any information about any borrowerother than creditwOlthiness characteristics such as debt, income, and credit score. In any Dataprovided to an enforcement or supervisory agency with jurisdiction over the Service!', theselimitations on borrower information shall not apply.

8. Publicity and Disclosure.

(a) ServiceI' shall not make use ofany Treasury name, symbol, emblem, program name, or productname, in any advertising, signage, promotional material, press release, Web page, publication, 01'

media interview, without the prior written cons ent of the Treasury.

(b) ServiceI' shall not publish, or cause to have published, or make public use of Fannie Mae's name,logos, trademarks, or any information about its relationship with Fannie Mae without the priorwritten permission of Fannie Mae, which permission may be withdrawn at any time in FannieMae's sole discretion.

(c) ServiceI' shall not publish, or cause to have published, or make public use ofFreddie Mac's name(Le., "Freddie Mac" or "Federal Home Loan M011gage Corporation"), logos, trademarks, or anyinformation about its relationship with Freddie Mac without the prior written permission ofFreddie Mac, which permission may be withdrawn at any time in Freddie Mac's sole discretion.

9. Limitation of Liability. IN NO EVENT SHALL FANNIE MAE, THE TREASURY, OR FREDDIEMAC, OR THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS ORAFFILIATES BE LIABLE TO SERVICER WITH RESPECT TO ANY OF THE PROGRAMS OR THEAGREEMENT, OR FOR ANY ACT OR OMISSION OCCURRING IN CONNECTION WITH THEFOREGOING, FOR ANY DAMAGES OF ANY KIND, INCLUDING, BUT NOT LIMITED TODIRECT DAMAGES, INDIRECT DAMAGES, LOST PROFITS, LOSS OF BUSINESS, OR OTHERINCIDENTAL, CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES OF ANY NATURE ORUNDER ANY LEGAL THEORY WHATSOEVER, EVEN IF ADVISED OF THE POSSIBILITY OFSUCH DAMAGES AND REGARDLESS OF WHETHER OR NOT THE DAMAGES WEREREASONABLY FORESEEABLE; PROVIDED, HOWEVER, THAT THIS PROVISION SHALL NOTLIMIT FANNIE MAE'S OBLIGATION TO REMIT PURCHASE PRICE PAYMENTS TO SERVICERIN ITS CAPACITY AS FINANCIAL AGENT OF THE UNITED STATES IN ACCORDANCE WITHTHE AGREEMENT.

10. Indemnification. ServiceI' shall indemnifY, hold harmless, and pay for the defense of Fannie Mae, theTreasury and Freddie Mac, and their respective officers, directors, employees, agents and affiliatesagainst all claims, liabilities, costs, damages, judgments, suits, actions, losses and expenses, includingreasonable attorneys' fees and costs of suit, arising out of or resulting from: (a) Servicer's breach ofSection 5 (Representations, Warranties and Covenants) of this Financial Instrument; (b) Servicer'snegligence, willful misconduct or failure to perform its obligations under the Agreement; or (c) anyinjuries to persons (including death) or damages to propelty caused by the negligent or willful acts oromissions of ServiceI' 01' its contractors. ServiceI' shall not settle any suit or claim regarding any of theforegoing without Fannie Mae's prior written consent if such settlement would be adverse to FannieMae's interest, or the interests of the Treasury or Freddie Mac. ServiceI' agrees to payor reimburse allcosts that may be incurred by Fannie Mae and Freddie Mac in enforcing this indemnity, includingattorneys' fees.

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IN WITNESS WHEREOF, Servicer hereby executes this Financial Instrument on the date set fOlth below.

Nations!ar Mortgage LLC:

[Name of Authori d Official][Title of Authorized Official]

120r3Er2-T L, AnELE.V f' "5e:~I/:f' c.r:10 G

I

~"-i_",Z__<'Li,L-'----"2::..:0::..:/_0_Date ;

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EXHIBITC

FORM OF CERTIFICATION


CERTIFICATION

This Certification is delivered as provided in Section t.e. ofth,~ AI1},~,~,~,ed and Restated Commitment to Purchase Financial Instrument and ServiceI'Participation Agreement (the "Commitment"), effective as orutNSER1t~,by and between Federal National Mortgage Association ("Fannie Mae"), afederally chattered corporation, acting as financial agent of the United States, and the undersigned party ("Selvicer"). All terms used, but notdefined herein, shall have the meanings ascribed to them in the Commitment.

I. ServiceI' is established under the laws ofthe United States or any state, territOlY} or possession ofthe United States 01' theDistrict ofColumbia, and has significant opel'ations in the United States. Servicer had full corporate power and authority to enterinto, execute, and deliver the Agreement and to perform its obligations hereunder and has all licenses necessary to carryon itsbusiness as now being conducted and as contemplated by the Agreement.

2. Servieer is in eompliance with, and certifies that all Services have been performed in compliance with, all applica bleFederal, state and local laws, regulations, regulatOlY guidance, statutes, ordinances, codes and requirements, ineluding, but notlimited to, the Truth in Lending Act, 15 USC 1601 § et seq., the Hnme Ownership and Equity Protectinn Act, 15 USC § 1639, theFederai Trade Commission Act, 15 USC § 41 et seq., the Equai Credit Opportunity Act, 15 USC § 701 et seq., the Fair CreditReporting Aet, 15 USC § 1681 et seq., the Fair Housing Act and other Federal and state laws designed to prevent unfair,discriminatory 01' predatOlY lending practices and all applicable laws governing tenant rights. Subject to the following sentence,Selvicer has obtained or made all governmental approvals or registrations required under law and has obtained all consentsnecessary to authorize the performanee ofits obligations under the Programs in whieh ServiceI' participated and the Agreement.The performance of Services under the Agreement has not eonflieted with, or been prohibited in any way by, any other agreementor statutOly restriction by which Servieer is bound, except to the extent ofany contractual limitations under applicable pooling andservicing agreements and other servieing contracts to which Selvicer is subject. Servieer is not aware of any other legal 01'

financial impediments to performing its obligations under the Programs or the Agreement and has promptly notified Fannie Mae ofany financial andlor operational impediments which may impair its ability to perform its obligations under the Programs or theAgreement. Servicer is not delinquent on any Federal tax obligation or any other debt owed to the United States or eolleeted bythe United States for the benefit of others, excluding any debts or obligations that are being eontested in good faith.

3. (i) Servicel' has performed its obligations in accordance with the Agreement and has promptly provided such performaneereporting as Fannie Mae and Prcddie Mac have reasonably required; (ii) aU Services have been offered by ServiceI' to borrowers,fully documented and servieed by Servicer in accordance with the applicable Program Documentation; Dnd (iii) all data, collectioninformation and other information reported by Servieer to Fannie Mae and Freddie Mac under the Agreement, including, but notlimited to, information that was relied upon by Fannie Mae and Freddie Mac in ealculating the Purchase Price and in performingany compliance review, was true, complete and accurate in all material respects, and consistent with all relevant business records,as and when provided.

4. Servicer has: (i) performed the Services required under the Program Documentation and the Agreement in accordancewith the practiees, high professional standards ofcare, and degree ofattention used in a well-managed operation, and no less thanthat which the Servicer exereises for itself under similar eircumstances; and (ii) used qualified individuals with suitable training,educDtion, experienee Dnd skills to perform the Selvices. Selvieer aeknowledges that Program partieipation required changes to, 01'

the augmentation ot: its systems, staffing and procedures; ServiceI' took all actions necessmy to ensure that it had the capaeity toimplement the Programs in which it participated in aeeordance with the Agreement.

5. Servieer has eomplied with all regulations on eonflicts of interest that are applicable to Servieer in connection with theeonduct of its business and all confliets of interest and non-disclosure obligations and restrictions and related mitigationprocedures set forth in the Program Documentation (ifany), as they related to the Programs in which ServiceI' participated.

6. Selvieer aeknowledges that the provision offalse or misleading information to Fannie Mae or Freddie Mac in connectionwith the Pl'ogrDms 01' pursuant to the Agreement may constitute a violation of: (a) Federal eriminallaw involving fraud, conflict ofinterest, bl'ibely, 01' gratuity violations found in Titie 18 of the United States Code; or (b) the civil False Ciaims Aet (31 U.S.c. §§3729-3733). Selvicer has disclosed to Fannie Mae and Freddie Mac any credible evidence, in connection with the Selvices, that amanagement offieial, employee, or eontractor ofSelvicer has committed, or may have committed, a violation of the referencedstatutes.

C-l


7. Servieer has diselosed to Fannie Mae and Freddie Mae any other faets or information that the Treasury, Fannie Mae orFreddie Mac should reasonably expeet to know about Servieer and its eontractors to help protect the reputational interests of theTreasury, Fannie Mae and Freddie Mae in managing and monitoring the Programs.

8. Servieer acknowledges that Fannie Mae and Freddie Mae may be required to assist the Treasury with responses to thePrivacy Act of 1974 (the HPrivacy Aet"), 5 USC § 552a, inquiries from borrowers and Freedom ofInformation Act, 5 USC § 552,inquiries from other parties, as well as formal inquiries from Congressional eommittees and members, the Govel1lmentAceountingOffice, Inspeetors General and other government entities, as well as media and eonsumer advoeaey group inquiries about thePrograms and their effeetiveness. ServiceI' has responded promptly and aecurately to all search requests made by Fannie Mae andFreddie Mac, complied with any related procedures whieh Fannie Mae and Freddie Mae have established, and provided relatedtraining to employees and contractors. In eonnection with Privacy Act inquiries, Servicel' has provided updated and correctedinformation as appropriate about borrowers' records to ensure that any system of record maintained by Fannie Mac on behalf ofthe Treasury is accurate and complete.

9. ServiceI' acknowledges that Fannie Mae is required to develop and implement customel' service call ccntcrs to respond toborrowers' and other parties' inquiries regarding the Programs in which ServiceI' participates, which may require additionalsupport from Servicet'o ServiceI' has provided such additional customer service cal1 support as Fannie Mae has rcasonablyrequested to support such Programs.

10. Servieer acknowledges that Fannie Mae and/or Freddie Mac are required to develop and implement practices to monitorand dctcct loan modification fraud and to monitor eompliance with applicable consumer protection and fair lending laws. ServiceI'has fully and promptly cooperated with Fannie Mae's inquiries about loan modifieation fraud and legal compliance and haseomplied with any anti-fraud and legal compliance procedures which Fannie Mac and/or FrcddieMac have required. Servicer hasdeveloped and implemented an internal control program to monitor and detect loan modification fraud and to monitor compliancewith applicable consumer protection and fail' lending laws, among other things, as provided in Scction 4 of the FinancialInstrument.

11. Solely if Servieer has elected to participatc in the Second Lien Modification Program by executing and delivering toFannie Mae a Service Schedule relating thereto, Servicel' acknowledges that each m0l1gage loan it modified under the Second LienModification Program was, at the time of modification, second in priority relative to the first lien that was modified under thePrograms.

In the event that any of the certifications made herein are discovcred not to be true and correct, Servicer agrees to notify Fannie Mae and FreddieMac immediately.

[Name of Authorized Official][Title of Authorized Official]

Date

C-2


EXHIBITD

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT


ASSIGNMENT AND ASSUMPTION AGREEMENT

This Assignment and A~stlm!'tionAgreelll~?t (the "Assignm~ntandAssumption Agreement") is entered into asof[ll>f~ER:r

;"' by a~d between [ilit$ER'm'FPJji11iill.~!il!~!il~4'!ili~;0Ee.\$"SIQNQm]("Assignor") and itffi!tilEFl::P'~!:ijji~'~,litGAL.NAMEIGNE1'1J ("Assig~~;;,). All t~l~~;;-;~d,butn~tdefined, herein shall have the mea~;~g~~s~ribeci t;' them in the

Underlying Agreement (defined below).

WHEREAS, Assignor and Federal National MOitgage Association, a federally chaltered corporation, as financial agent oftheUnited States ("Fannie Mae"), are palties to an Amended and Restated Commitment to Purchase Financial Instrument andServiceI' Palticipation Agreement, a complete copy ofwhich (including all exhibits, amendments and modifications thereto) isattached hereto and incorporated herein by this reference (the "Undedying Agreement");

WHEREAS, Assignor has agreed to assign to Assignee all of its rights and obligations under the Underlying Agreement withrespect to the Eligible Loans that are identified on the schedule attached hereto as Schedule I (collectively, the "AssignedRights and Obligations"); and

WHEREAS, Assignee has agreed to assume the Assigned Rights and Obligations.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, theparties hereto agree as follows:

I. Assignment. Assignor hereby assigns to Assignee all of Assignor's rights and obligations under the Underlying Agreementwith respect to the Assigned Rights and Obligations.

2. Assumption. Assignee hereby accepts the foregoing assignment and assumes all ofthe rights and obligations ofAssignorunder the Underlying Agreement with respect to the Assigned Rights and Obligations.

3. Effective Date. The date on which the assignment and assumption of rights and obligations under the UnderlyingAgreement is effective is tIDM!$'l!jRl'J!'~;~l!ll{~~fj;ilj~@j~m~m~l.Di\1ii~~~:C!ii!:1i*jil!J,il1!ililfi!l~~1l1~iJ:f:l~1lt!lJ)Nl

4. Successors. All future transfers and assignments of the Assigned Rights and Obligations transferred and assigned herebyare subject to the transfer and assignment provisions of the Underlying Agreement. This Assignment and AssumptionAgreement shall inure to the benefit of, and be binding upon, the permitted successors and assigns of the parties hereto.

5. Counterpalts. This Assignment and Assumption Agreement may be executed in counterpmts, each of which shall be anoriginal, but all of which together constitute one and the same instrument.

D-l


IN WITNESS WHEREOF, Assignor and Assignee, by their duly authorized officials, hereby execute and deliver thisAssignment and Assumption Agreement, together with Schedu Ie 1, effective as of the date set forth in Section 3 above,

By:------------------Name:. _Title: _Date: _

0-2

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SCHEDULE I

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ASSIGNMENT AND ASSUMPTION AGREEMENT

0-3


EXHIBITE

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JS 44 (Rev. 12/12) CIVIL COVER SHEET

The JS 44 civil cover sheet and the information contained herein neither replace nor supplement the filing and service of pleadings or other papers as required by law, except as provided by local rules of court. This form, approved by the Judicial Conference of the United States in September 1974, is required for the use of the Clerk of Court for the purpose of initiating the civil docket sheet. (SEE INSTRUCTIONS ON NEXT PAGE OF THIS FORM.)

I. (a) PLAINTIFFS DEFENDANTS DENNIS BURTON, on behalf of himself

and all others similarly situated,

NATIONSTAR MORTGAGE LLC, a Delaware limited liability company,

(b) County of Residence of First Listed Plaintiff Colorado State County of Residence of First Listed Defendant (EXCEPT IN U.S. PLAINTIFF CASES) (IN U.S. PLAINTIFF CASES ONLY)

NOTE: IN LAND CONDEMNATION CASES, USE THE LOCATION OFTHE TRACT OF LAND INVOLVED.

(c) Attorneys (Firm Name, Address, and Telephone Number) Attorneys (If Known) Sean Reis, Esq., Edelson McGuire LLP, 30021 Tomas Street, Suite 300, Rancho

Santa Margarita, CA 92688 (949) 459-2124

II. BASIS OF JURISDICTION (Place an “X” in One Box Only) III. CITIZENSHIP OF PRINCIPAL PARTIES (Place an “X” in One Box for Plaintiff (For Diversity Cases Only) and One Box for Defendant)

1 U.S. Government 3 Federal Question PTF DEF PTF DEF Plaintiff (U.S. Government Not a Party) Citizen of This State 1 1 Incorporated or Principal Place 4 4 of Business In This State

2 U.S. Government 4 Diversity Citizen of Another State 2 2 Incorporated and Principal Place 5 5 Defendant (Indicate Citizenship of Parties in Item III) of Business In Another State Citizen or Subject of a 3 3 Foreign Nation 6 6 Foreign Country

IV. NATURE OF SUIT (Place an “X” in One Box Only) CONTRACT TORTS FORFEITURE/PENALTY BANKRUPTCY OTHER STATUTES

110 Insurance PERSONAL INJURY PERSONAL INJURY 625 Drug Related Seizure 422 Appeal 28 USC 158 375 False Claims Act 120 Marine 310 Airplane 365 Personal Injury - of Property 21 USC 881 423 Withdrawal 400 State Reapportionment 130 Miller Act 315 Airplane Product Product Liability 690 Other 28 USC 157 410 Antitrust 140 Negotiable Instrument Liability 367 Health Care/ 430 Banks and Banking 150 Recovery of Overpayment 320 Assault, Libel & Pharmaceutical PROPERTY RIGHTS 450 Commerce

& Enforcement of Judgment Slander Personal Injury 820 Copyrights 460 Deportation 151 Medicare Act 330 Federal Employers’ Product Liability 830 Patent 470 Racketeer Influenced and 152 Recovery of Defaulted Liability 368 Asbestos Personal 840 Trademark Corrupt Organizations

Student Loans 340 Marine Injury Product 480 Consumer Credit (Excludes Veterans) 345 Marine Product Liability LABOR SOCIAL SECURITY 490 Cable/Sat TV

153 Recovery of Overpayment Liability PERSONAL PROPERTY 710 Fair Labor Standards 861 HIA (1395ff) 850 Securities/Commodities/ of Veteran’s Benefits 350 Motor Vehicle 370 Other Fraud Act 862 Black Lung (923) Exchange

160 Stockholders’ Suits 355 Motor Vehicle 371 Truth in Lending 720 Labor/Management 863 DIWC/DIWW (405(g)) 890 Other Statutory Actions 190 Other Contract Product Liability 380 Other Personal Relations 864 SSID Title XVI 891 Agricultural Acts 195 Contract Product Liability 360 Other Personal Property Damage 740 Railway Labor Act 865 RSI (405(g)) 893 Environmental Matters 196 Franchise Injury 385 Property Damage 751 Family and Medical 895 Freedom of Information

362 Personal Injury - Product Liability Leave Act Act Medical Malpractice 790 Other Labor Litigation 896 Arbitration

REAL PROPERTY CIVIL RIGHTS PRISONER PETITIONS 791 Employee Retirement FEDERAL TAX SUITS 899 Administrative Procedure210 Land Condemnation 440 Other Civil Rights Habeas Corpus: Income Security Act 870 Taxes (U.S. Plaintiff Act/Review or Appeal of 220 Foreclosure 441 Voting 463 Alien Detainee or Defendant) Agency Decision 230 Rent Lease & Ejectment 442 Employment 510 Motions to Vacate 871 IRS—Third Party 950 Constitutionality of240 Torts to Land 443 Housing/ Sentence 26 USC 7609 State Statutes245 Tort Product Liability Accommodations 530 General290 All Other Real Property 445 Amer. w/Disabilities 535 Death Penalty IMMIGRATION

Employment Other: 462 Naturalization Application 446 Amer. w/Disabilities 540 Mandamus & Other 465 Other Immigration Other 550 Civil Rights Actions 448 Education 555 Prison Condition 560 Civil Detainee - Conditions of Confinement

V. ORIGIN (Place an “X” in One Box Only) Transferred from Another District (specify)

1 Original

Proceeding 2 Removed from

State Court 3 Remanded from

Appellate Court 4 Reinstated or

Reopened 5 6 Multidistrict

Litigation

VI. CAUSE OF ACTION

Cite the U.S. Civil Statute under which you are filing (Do not cite jurisdictional statutes unless diversity): 28 U.S.C. 1332(d) (diversity) Brief description of cause: Breach of contract and other claims related to Defendant's systematic failure to provide permanent loan modifications

VII. REQUESTED IN COMPLAINT:

CHECK IF THIS IS A CLASS ACTION UNDER RULE 23, F.R.Cv.P.

DEMAND $ 5,000,000+ CHECK YES only if demanded in complaint:

JURY DEMAND: Yes No

VIII. RELATED CASE(S) IF ANY

(See instructions):

JUDGE DOCKET NUMBER

DATE SIGNATURE OF ATTORNEY OF RECORD

03/04/2013 /s/ Sean P. Reis

FOR OFFICE USE ONLY

RECEIPT # AMOUNT APPLYING IFP JUDGE MAG. JUDGE


Sean Reis

Pencil

JS 44 Reverse (Rev. 12/12)

INSTRUCTIONS FOR ATTORNEYS COMPLETING CIVIL COVER SHEET FORM JS 44

Authority For Civil Cover Sheet

The JS 44 civil cover sheet and the information contained herein neither replaces nor supplements the filings and service of pleading or other papers as required by law, except as provided by local rules of court. This form, approved by the Judicial Conference of the United States in September 1974, is required for the use of the Clerk of Court for the purpose of initiating the civil docket sheet. Consequently, a civil cover sheet is submitted to the Clerk of Court for each civil complaint filed. The attorney filing a case should complete the form as follows: I. (a) Plaintiffs-Defendants. Enter names (last, first, middle initial) of plaintiff and defendant. If the plaintiff or defendant is a government agency, use only the full name or standard abbreviations. If the plaintiff or defendant is an official within a government agency, identify first the agency and then the official, giving both name and title. (b) County of Residence. For each civil case filed, except U.S. plaintiff cases, enter the name of the county where the first listed plaintiff resides at the time of filing. In U.S. plaintiff cases, enter the name of the county in which the first listed defendant resides at the time of filing. (NOTE: In land condemnation cases, the county of residence of the "defendant" is the location of the tract of land involved.) (c) Attorneys. Enter the firm name, address, telephone number, and attorney of record. If there are several attorneys, list them on an attachment, noting in this section "(see attachment)". II. Jurisdiction. The basis of jurisdiction is set forth under Rule 8(a), F.R.Cv.P., which requires that jurisdictions be shown in pleadings. Place an "X" in one of the boxes. If there is more than one basis of jurisdiction, precedence is given in the order shown below. United States plaintiff. (1) Jurisdiction based on 28 U.S.C. 1345 and 1348. Suits by agencies and officers of the United States are included here. United States defendant. (2) When the plaintiff is suing the United States, its officers or agencies, place an "X" in this box. Federal question. (3) This refers to suits under 28 U.S.C. 1331, where jurisdiction arises under the Constitution of the United States, an amendment to the Constitution, an act of Congress or a treaty of the United States. In cases where the U.S. is a party, the U.S. plaintiff or defendant code takes precedence, and box 1 or 2 should be marked. Diversity of citizenship. (4) This refers to suits under 28 U.S.C. 1332, where parties are citizens of different states. When Box 4 is checked, the citizenship of the different parties must be checked. (See Section III below; NOTE: federal question actions take precedence over diversity cases.) III. Residence (citizenship) of Principal Parties. This section of the JS 44 is to be completed if diversity of citizenship was indicated above. Mark this section for each principal party. IV. Nature of Suit. Place an "X" in the appropriate box. If the nature of suit cannot be determined, be sure the cause of action, in Section VI below, is sufficient to enable the deputy clerk or the statistical clerk(s) in the Administrative Office to determine the nature of suit. If the cause fits more than one nature of suit, select the most definitive. V. Origin. Place an "X" in one of the six boxes. Original Proceedings. (1) Cases which originate in the United States district courts. Removed from State Court. (2) Proceedings initiated in state courts may be removed to the district courts under Title 28 U.S.C., Section 1441. When the petition for removal is granted, check this box. Remanded from Appellate Court. (3) Check this box for cases remanded to the district court for further action. Use the date of remand as the filing date. Reinstated or Reopened. (4) Check this box for cases reinstated or reopened in the district court. Use the reopening date as the filing date. Transferred from Another District. (5) For cases transferred under Title 28 U.S.C. Section 1404(a). Do not use this for within district transfers or multidistrict litigation transfers. Multidistrict Litigation. (6) Check this box when a multidistrict case is transferred into the district under authority of Title 28 U.S.C. Section 1407. When this box is checked, do not check (5) above. VI. Cause of Action. Report the civil statute directly related to the cause of action and give a brief description of the cause. Do not cite jurisdictional statutes unless diversity. Example: U.S. Civil Statute: 47 USC 553 Brief Description: Unauthorized reception of cable service VII. Requested in Complaint. Class Action. Place an "X" in this box if you are filing a class action under Rule 23, F.R.Cv.P. Demand. In this space enter the actual dollar amount being demanded or indicate other demand, such as a preliminary injunction. Jury Demand. Check the appropriate box to indicate whether or not a jury is being demanded. VIII. Related Cases. This section of the JS 44 is used to reference related pending cases, if any. If there are related pending cases, insert the docket numbers and the corresponding judge names for such cases. Date and Attorney Signature. Date and sign the civil cover sheet.
