Statement on Sub-prime Lending

Foundation Financial Group embraces responsible lending principles. We support the efforts by the industry to strengthen underwriting standards and to protect borrowers against unfair or deceptive mortgage lending practices.

FFG attempts to help current customers with sub-prime loans that are delinquent or in danger of becoming delinquent by offering options to these customers whenever possible through refinancing.

Foundation Financial Group only makes home loans to consumers with sub-prime credit when the ability to repay the loans is established based on the information available at the time the loan is made.

Loan terms, features, benefits and risks are clearly disclosed to consumers in ways that enable them to make an educated decision about the loan product they choose. In the event that a customer chooses a loan product with an adjustable rate, the timing and estimated amounts of future payment changes are clearly communicated to consumers in accordance with applicable disclosure laws and good business practices.

Foundation Financial Group's business processes are designed to prohibit steering borrowers who qualify for prime loans into a sub-prime loan. The majority of consumers who come to Foundation Financial Group receive a prime loan. If a prime loan is not available to the customer, but a loan designed for sub-prime credit borrowers is available, that loan will only be offered to the customer if the new loan product represents a clear "net tangible benefit" to the borrower.

Foundation Financial Group's loan originators do not receive higher commissions for sub-prime loans, and these products are only offered as an absolute last case scenario.

Many of our secondary market business partners have already tightened underwriting standards to reduce the risk of default on sub-prime loans and we have embraced these new underwriting standards.