LowRatesLender to Introduce a Universal Automated Underwriting System for Non-Conforming Mortgage Loans

Business Wire, August 6, 2003

Business Editors

SALT LAKE CITY--(BUSINESS WIRE)--Aug. 6, 2003

LowRatesLender, a division of American Pioneer Financial Services, Inc., is preparing to introduce its Virtual Loan Officer(TM) (VLO) technology for the automated rate quotation and approval of all types of non-conforming mortgage loans. "This has been a very challenging project, which spanned over three years," said John Williams, CEO, "but the resulting technology is far superior to what even we envisioned when we began. It not only has the ability to give us a huge edge in attracting and retaining mortgage brokers and other originators as our customers, but also has very significant potential to be licensed to other mortgage companies and financial entities across the nation."

This Virtual Loan Officer(TM) technology (VLO) is a fully- integrated Automated Underwriting and Rate Quoting system that is capable of integrating the rate quoting and underwriting rules of thousands of loan programs from hundreds of different end-investors and, because of its unique design, is extremely easy to maintain. It is also designed to be private labeled to users very easily and quickly, usually within less than an hour. It has been developed in a manner that allows us to quickly and easily recreate the approval and rate quotation rules and parameters for loan products of multitudes of investors. "As a demonstration of the ease with which the system can incorporate different products, in the few short weeks since completion of the 'rules engines' underlying the VLO the LowRatesLender team has entered all of the approval and rate quoting parameters for loan products of Residential Funding Corporation (RFC) and is now finishing entering the approval and rate quotation parameters for the products of Impac Funding Corporation (IMPAC)," said Lance Strosser, COO. "Within a few more weeks we will have approval parameters and rates for Novastar, Provident and GMAC products. And we can, with minimal staff, continue to add investors' products and rates very rapidly." LowRates included these companies' products first because they are the end-investors who buy much of the LowRatesLender production.

The VLO is an integrated system that can be made available to mortgage brokers or other loan originators that allows them to enter the loan data directly into the system and INSTANTLY receive an approval and certificate based on the approval parameters of numerous different end-investors. The originating broker will no longer need to know the loan parameters of dozens of end-investors or try to keep up with ever-changing rules. He just needs to enter his loan data once into the VLO and he will receive appropriate approvals based on the information within minutes, as well as detailed reasons why his borrower didn't qualify for other loan programs. The system can even be made to give suggestions as to what the customer could do to qualify for a better loan program. When the approval is received, it also includes instant and 100% accurate rates for the approved loan programs, which he can then manipulate himself to determine broker rebates, buy-down points, monthly payments, etc. He can quickly and easily run multiple scenarios for his loan submissions to come up with the best product for his customer, even if he doesn't really know the loan programs available from the different non-conforming lenders. Today, the originator needs to enter his borrowers credit score and information, but within 30 days the VLO will also include an automated credit-pull, currently being implemented through First American CREDCO. The company is contemplating the addition of other credit reporting systems.

LowRatesLender believes that there is significant marketing power in being able to give brokers and other mortgage loan originators access to just ONE AU engine (which can be private labeled for them if they desire) and having this single source incorporate the approval for loan programs and automated rate quotation for as many different lenders as desired. In addition, the company believes that its automated rate quoting system for many of the products is far superior to even what some of the end-investors currently provide for their own products because the VLO's rate quotation engine is fully-integrated with the loan approval engine.

In addition, the company believes that there is significant potential for licensing the VLO to net branch operators who would be able to offer the programs and rates of hundreds of investors to their branches on one simple-to-use platform.

"As the A-paper refinance boom is ending, the future growth of the mortgage market will be in non-conforming loan products," said Ernest Knudsen, President, "and this technology makes these loans almost as easy to do as A-paper."

About the Company -- American Pioneer Financial Services, Inc. was founded in 1992 and is a mortgage lender that is licensed (or meets licensing exemptions) in 26 states and is headquartered in the Salt Lake City, Utah area. The Company utilizes various DBA's in its various markets, including LowRatesUSA, LowRatesLender, LowRatesLender Services and Mortgage Outsource Center. It specializes in making non-conforming loans to the clients of mortgage originators including mortgage brokers, REALTORS(TM), banks, credit unions, CPA's and financial planners. The board of Directors includes John M. Williams, Chairman and CEO, Ernest Knudsen, President (also serves as Secretary of the Fraud and Ethics subcommittee of the MBAA), Lance Strosser, COO, Robert J. Frankenberg and James Robinson. The company is privately held and is now actively seeking partners to assist in marketing and exploiting its VLO technologies.