Hope Now Program

HOPE NOW is the alliance of counselors, mortgage market participants, and mortgage
servicers that is working to help as many homeowners as possible avoid foreclosure and
stay in their homes.

HOPE NOW coordinates a nationwide campaign to reach homeowners who may be at
risk of losing their homes. So far, HOPE NOW has sent almost 1.9 million letters.
About 17 percent of homeowners receiving the HOPE NOW-coordinated letters have
contacted their servicer, 6 times more than the routine 2-3 percent response rate servicers
receive when they send their own mailings.

In the past nine months, HOPE NOW has connected thousands of homeowners with their
lender and/or a HUD-certified housing counselor at workshops in more than 20 cities.
Additional workshops are being scheduled around the country.

In addition, HOPE NOW members have agreed to make substantial additional efforts to
contact homeowners whose mortgages will reset in the coming months and to further
expedite the process used to determine how best to keep them in their homes.

Start Date: December 15, 2008.

Goal of SMP: Help the most at-risk borrowers stay in their homes through a streamlined
process to establish an affordable monthly housing payment. The goal is to
reach a monthly housing payment (which includes capitalized past due
payments, principal, interest, taxes, insurance and HOA/condo fees) that is
no more than 38% of the borrower’s monthly gross household income.

How SMP Works: Participating servicers work with eligible qualified borrowers to reach a
more affordable mortgage payment through extending the term of the
loan, lowering the interest rate, and/or forbearing principal. All
outstanding late fees are waived.

Eligible Borrowers: 90 days or more past due on mortgage, can be in foreclosure, must not be
in bankruptcy, owns and occupies the property, and the property is a single
family residence.

90% or Higher LTV: Borrower’s current loan-to-value ratio must be 90% or higher. The
property value will be determined by the servicer, Fannie Mae or Freddie
Mac, depending on ownership of the loan.

Mandatory Escrow: Escrows for real estate taxes and homeowners’ insurance must be set up
under this program if they are not currently escrowed.

Required Documentation: A hardship statement, verification of monthly gross household income, and a signed modification agreement. The homeowner must make the first
payment at the modified terms when he or she submits these documents.
3 Months of Payments: For modification to be complete, borrower must make 3 payments within 90 days at the new modified payment level and be current at day 90.

Counseling Encouraged: Participating servicers and investors encourage borrowers to seek housing counseling at HUD-approved housing counseling agencies.

Participating Investors: Fannie Mae, Freddie Mac, and majority of HOPE NOW portfolio
lenders/servicers.

Reaching Borrowers: Participating servicers will send letters to eligible borrowers. Borrowers
may also call their servicer to see if they qualify.

Reaching Servicers: Servicers are encouraged to dedicate separate toll-free numbers and faxes
for borrowers interested in SMP. When established, those numbers will be
publicized by HOPE NOW and participating investors and servicers.

Reporting: Participating servicers are required to report on implementation and
success of SMP. HOPE NOW will release data on this program on an ongoing basis.

Additional Tool: SMP is an additional tool to assist homeowners avoid foreclosure. It is
compatible with and does not replace other on-going efforts by servicers and investors. If a borrower does not qualify for SMP, they are eligible for a case-by-case review.