ANNOUNCEMENT 08-04

BORROWERS WITH NO CREDIT SCORES*

Effective Wednesday, March 19th, Security Atlantic will no longer accept loans unless all of the borrowers have at least one credit score.  Please note the following:

(1) The last day to submit a new loan for underwriting that includes a borrower without credit scores will be Tuesday, March 18th (tomorrow);

(2) All loans not locked by Wednesday, March 19th, will be subject to a 3 point add-on;

(3) The last day to close one of these loans will be Friday, March 28th; existing loans not closed by that date may only be closed on an exception basis.

This change is due to new secondary market restrictions and in no way reflects a risk-based decision on the part of Security Atlantic.  We do not feel that borrowers with no credit score present unacceptable risk, as historically loans closed by Security Atlantic meeting this criteria have performed adequately.  It is our hope that this restriction is not permanent.

Noel M. Chapman, EVP

*Does not apply to streamline refinances of any type.