A GUIDE TO YOUR ESCROW STATEMENT

What is an Annual Escrow Account Statement? Nationstar Mortgage may pay certain bills associated with your property and loan agreement. These can include property taxes, hazard insurance (also called homeowners or property insurance), flood insurance (if applicable), and FHA insurance or private mortgage insurance (MIP or PMI) from your escrow account. An Annual Escrow Account Statement, also called an Escrow Analysis, is a review and recalculation of this account that Nationstar Mortgage must perform and send to all borrowers with escrow accounts each year. The Escrow Analysis compares the deposits collected each month in the escrow account with the amounts paid out of the account during the 12-month escrow cycle. Based on this information, we calculate the projected amount necessary to pay these bills for the next cycle and divide the total projected amount by 12 to determine the monthly escrow deposit. Finally, the Statement shows how the escrow changes will affect your monthly payment.

Mortgage Payment
This section notifies you of the effective date of any payment change. It also compares your current monthly payment with your new monthly payment.

Projections for the Coming Year

This section provides you a schedule of payment and disbursement activity for your escrow account anticipated for the coming year. Taxes are estimated based on your previous tax bills paid. If you believe the account or due date of your taxes or insurance is incorrect, please contact the taxing authority or your insurance agent for verification. Nationstar Mortgage must receive updated documentation from your taxing authority/insurance provider in order to update your loan data. The lowest monthly escrow balance during the 12 month projection is your Projected Low-Point. Your escrow balance is projected on a 12 month period assuming regular payments received as well as regularly scheduled payments. Mortgage Insurance, if any, is not included in the required Low-Point calculation. This is reflected in the running Projected and Required Balance. The running Projected Balance is compared with a running Required Balance to determine whether a surplus or shortage exists.

P.O. BOX 199400 DALLAS, TX 75219

ANNUAL ESCROW ACCOUNT DISCLOSURE STATEMENT

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CUSTOMER SERVICE 1-888-725-5295 TOLL FREE

LOAN NUMBER: 1234567890 ANALYSIS DATE: 01/08/06

PREVIOUS PAYMENT PAYMEN A T

NEW PAYMENT PAYMEN A T AS OF 02/01/06 P&I ESCROW OPTIONAL INS TOTAL TOTA T L 701.75 181.77 0.00 883.52

CUSTOMER NAME 1 CUSTOMER NAME 2 ADDRESS 1 ADDRESS 2 CITY STATE ZIP

P&I ESCROW OPTIONAL INS TOTAL TOTA T L

701.75 260.60 0.00 962.35

COMING YEAR ESCROW PROJECTION

The purpose of the Coming Year Escrow Projection is to determine the lowest balance Low Point to which your escrow account will decline over the upcoming year. The purpose of the Low Balance Summary is to compare the projected and allowable low point amounts. If the projected low point is greater than the allowable low point, there is a surplus. If the projected low point is less than the allowable low point, there is a shortage and/or deficiency which will be recovered by an adjustment to your mo nthly payment over a specified number of months. The adjustment amount(s) appears in the Low Balance Summary and New Payment information.

ANTICIPATED ESCROW DISBURSEMENTS

MONTH

PAYMENTS TO ESCROW

PAYMENTS FROM ESCROW

DESCRIPTION

CUR BAL PROJECTION

REQ BAL PROJECTION

COUNTY TAX

2,181.22

TOTAL DISBURSEMENTS DIVIDED BY 12 MONTHS

$2,181.22

MONTHLY ESCROW DEPOSIT $181.77 (MAY VARY DUE TO ROUNDING)

STARTING BALANCE FEB 05 181.77 MAR 05 181.77 APR 05 181.77 MAY 05 181.77 JUN 05 181.77 JUL 05 181.77 AUG 05 181.77 SEP 05 181.77 OCT 05 181.77 NOV 05 181.77 DEC 05 181.77 DEC 05 JAN 06 181.77 TOTAL $2,181.24

2,181.22

PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT PAYMENT COUNTY TAX PAYMENT

781.82 963.59 1,145.36 1,327.13 1,508.90 1,690.67 1,872.44 2,054.21 2,235.98 2,417.75 2,599.52 2,781.29 600.07 781.84

545.29 727.06 908.83 1,090.60 1,272.37 1,454.14 1,635.91 1,817.68 1,999.45 2,181.22 2,362.99 2,544.76 363.54 < 545.31

Determining your Shortage or Surplus

Shortage: Any shortage in your escrow account is usually caused by one of the following items: An increase, if any, in what was paid for insurance and/or taxes from your escrow account. A projected increase in taxes for the upcoming year. The number of months elapsed from the time of these disbursements to the new payment effective date. Shortages are divided evenly over the next twelve months. To reduce the increase in your monthly payment, the shortage can be paid either partially or in full. Surplus: A surplus in your escrow account is usually caused by one of the following items: The insurance/taxes paid during this past year were lower than projected. A refund was received from the taxing authority or insurance carrier. Additional funds were applied to your escrow account. If your surplus is $50.00 or greater and your loan was contractually current at the time when the analysis was run or calculated, a check will accompany your escrow statement. If your surplus is less than $50.00, the funds will be retained in your escrow account.

$2,181.22

LOW BALANCE SUMMARY R PROJECTED LOW POINT RESPA P LOW POINT SHORTAGE SHORTAG T E OVER PRORATED A 12 MONTHS SURPLUS 600.07 363.54 0.00 0.00 236.53

692-XXXX-0606F

The cushion allowed by federal f law (RESPA) (RESPA P ) is two times your monthly escrow payment (excluding MIP/PMI), unless state law specifies a lower amount.

IF YOUR SURPLUS IS $50 OR GREATER, NATIONSTAR MORTGAGE WILL ATTACH A REFUND CHECK TO YOUR ESCROW ANALYSIS, PROVIDED YOUR LOAN IS CURRENT. IF YOUR SURPLUS IS LESS THAN $50, THE FUNDS WILL REMAIN IN YOUR ESCROW ACCOUNT.

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