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REV: 06-11-25 LF Please note: For single-family loans, unless respective state law requires otherwise, Consultant’s escrow analysis utilizes a 2-month cushion in accordance with RESPA. This cushion is an industry standard and is intended to minimize the likelihood of escrow shortages / deficits when and if escrow disbursement items increase. If this cushion is not consistent with the City’s current escrow analysis process, borrowers’ escrow analysis may result in a shortage and/or escrow payment increase at the time of Consultant’s first analysis. This may impact borrowers’ ability to make increased monthly payments to escrow. Should the Assistant City Manager or Housing Manager request alternative handling of loan accounts with escrow payment increases, this may result in the City incurring extraordinary services charges. If the City chooses to establish an escrow/impound account, Consultant will track and reconcile advances made by Consultant on borrower accounts with escrow deficits as a result of payments made on the borrower’s behalf in excess of their escrow balance. Escrow advances will be reconciled monthly, and netted against escrow payments collected from the borrowers. The net change will be included or deducted from the City’s monthly remittance; a net shortage/negative will be deducted and a net overage/positive will be remitted. Advances made by Consultant that are not reimbursed by the City the following month will be subject to an interest charge of 1% per month compounded until such time said reimbursement occurs. Regardless of whether or not the net shortage/negative is deducted from remittance at the end of the month, the City remains responsible for escrow advances made by Consultant. At portfolio transfer Consultant will require a cash deposit equal to the total amount of positive escrow balances. Negative escrow balances will be set up, but the total amount of negative escrow balances will not be netted out of the positive cash escrow balances. Should recurring advances become necessary, Consultant reserves the right to request the City to deposit an amount into reserve to cover the anticipated necessary advances. 7. Late Fees: In keeping with the provisions of the City’s promissory note, Consultant will assess and retain a late fee when payment is not made within the grace period. Lender Placed Insurance In accordance with respective regulation, upon notification of a policy cancellation from the borrower’s insurance carrier, or when proof of a current policy is not received, Consultant will request lender-placed insurance from Consultant’s insurance provider. Consultant executes the force-placement of insurance on a portfolio wide level, meaning it is done for all loans in the portfolio for which insurance has lapsed. If the City wishes to select loans for the force placement of insurance on an “as requested” basis, it will be the City’s responsibility to verify the placement has been completed by Consultant. This quality control step aids in ensuring that the City’s instructions from the Assistant City Manager or Housing Manager were received by Consultant, usually via email. The City ATTY/AGR.2025.144/AmeriNational Community Services, LLC d/b/a AmeriNat (Page 16 of 31)