FORM 10A.26 FORECLOSURE OF COLLATERALLY ASSIGNED

FORM 10A.26 FORECLOSURE OF COLLATERALLY ASSIGNED DEED OF TRUST

AGREEMENT made as of _________, 20__, by and among __________ (“Lender”), __________ (“Borrower”) and __________ (“Title Company”). RECITALS A.

Borrower is indebted to Lender as evidenced by a Promissory Note, dated ___________, 20__ in the original principal amount of $__________, having a current unpaid principal balance of $__________, with interest accrued through this date of $__________ (“Note”). Payment of the indebtedness evidenced by the Note is secured in part, by a pledge of a promissory note, dated ___________, 20__, made and delivered by __________ in favor of Borrower (“Assigned Note”).

B.

The Collaterally Assigned Note is secured by a Deed of Trust made ___________, 20__, between __________, as Trustor, and Title Company, as Trustee, and recorded ___________, 20__, at Document Number __________ of the Official Records of __________ [county, state] (“Collaterally Assigned Deed of Trust”).

C.

As a part of the pledge, Borrower executed and delivered to Lender an assignment of the Collaterally Assigned Note and of his beneficial interest under the Collaterally Assigned Deed of Trust, denominated “Assignment of Beneficial Interest Under Deed of Trust,” dated _______, 20__, and recorded ___________, 20__, at Document Number __________ of the Official Records of [county, state] (“Collateral Assignment”).

D.

__________ is presently in physical possession of the Collaterally Assigned Note as servicing agent under collection escrow account number __________.

E.

Title Company, as payor of the Collaterally Assigned Note, is in default under said Note, and Borrower wishes to cause the Collaterally Assigned Deed of Trust to be foreclosed.

F.

Borrower has requested that Lender extend the maturity date and modify the terms and conditions of the Borrower Note. Lender, although under no prior obligation to do so, is willing to comply with that request, but only upon the terms and conditions hereinafter set forth.

AGREEMENT NOW, THEREFORE, in consideration of the premises and promises hereinafter set forth, the parties agree as follows: 1.

Accuracy of Recitals. [See Standard Clauses]

2.

No Defenses or Counterclaims. [See Standard Clauses]

3.

Collateral. Borrower’s performance hereunder, and with respect to all obligations owing by him to Lender, including those evidenced by the Note and all extensions, renewals or replacements thereof, shall continue to be secured by the Collaterally Assigned Note and Collaterally Assigned Deed of Trust. From the date hereof until the conclusion of the foreclosure of the lien evidenced by the Collaterally Assigned Deed of Trust, or the date Lender gives notice to Title Company of the revocation of Borrower’s authority under paragraph 7 hereof, whichever occurs first, Title Company shall remain in possession of the original Collaterally Assigned Note and Collaterally Assigned Deed of Trust as bailee for Lender for the specific purpose of perfecting Lender’s security interest in the Collaterally Assigned Note, and shall be deemed to have acted in such capacity since ___________, 20__. Title Company acknowledges that it has received notification of its capacity as bailee and of Lender’s security interest in the Collaterally Assigned Note and Deed of Trust.

4.

Modification and Extension. Borrower hereby promises to pay the unpaid principal balance of the Note, together with all interest accrued and accruing thereon and fees and expenses owing thereunder, all as set forth below: a. Borrower shall pay the principal sum of $__________ on or before ___________, 20__, and shall pay interest accrued and accruing on the unpaid principal balance monthly, on the first day of each month until ___________, 20__, at which time the entire unpaid balance, including principal, interest, costs, and fees, shall be paid in full. b. Absent a default or demand, interest shall be charged on the unpaid principal balance of the Note on a daily basis for the actual number of days any portion of the principal is outstanding, computed on the basis of a 360-day year, at a rate (“Modified Note Rate”) equal to the Base Rate (as defined below) plus __________ percent (___%) per annum, the interest rate to be adjusted on the effective date of each change in the Base Rate. “Base Rate” as used herein means a fluctuating interest rate per annum as in effect from time to time, which interest rate per annum shall at all times be equal to the rate of interest established from time to time (whether or not charged in each instance), by Lender, in [publication], as Lender’s “Base Rate.” Each change in the Base Rate (or and

component thereof) shall become effective, without notice to Borrower (which notice is hereby expressly waived by Borrower), on the effective date of each such change. Should Lender, during the term of this Agreement, abolish or abandon the practice of establishing a Base Rate, then the Base Rate used during the remaining term of this Agreement shall be that interest rate then in effect at Lender, which, from time to time, in the reasonable judgment of Lender, most effectively approximates the original definition of the “Base Rate.” Borrower acknowledges that Lender, may from time to time, extend credit to other persons at rates of interest varying from, and having no relationship to, the Base Rate. A certificate signed by any vice-president of Lender shall be conclusive evidence of the Base Rate at any given time. 5.

Default Interest and Charges. All obligations under the Note (including principal, interest, costs, and fees) not discharged when due or upon “default” shall bear interest, until paid in full, at the greater of (a) a per annum rate equal to ________ percent (__%) of the Modified Note Rate or (b) ________ percent (__%) per annum. In the event that any payment becomes overdue for a period in excess of ten (10) days, and Lender does not exercise its option to accelerate the maturity of the Note, a late charge of ________ percent (__%) of the overdue payment may be charged by Lender for the purpose of defraying the costs and expenses incident to such delinquency.

6.

Borrower’s Appointment as Collection Agent. Lender hereby appoints Borrower as Lender’s special agent for the sole and limited purpose of enforcing, by foreclosure pursuant to [applicable state] law, the Collaterally Assigned Deed of Trust, and for the purpose of collecting for Lender all sums due and owing thereunder or secured thereby. Lender hereby assigns for the duration of this Agreement and without any warranty, express or implied as to collectibility or value, such right, title, and interest in the Collaterally Assigned Note and the beneficial interest in the Collaterally Assigned Deed of Trust as are necessary to enable Borrower to enforce the terms of the Collaterally Assigned Note and the Collaterally Assigned Deed of Trust, and to collect all sums due and owing thereunder or secured thereby; provided, however, that Borrower shall not be deemed authorized to compromise, or to postpone or extend the time for payment of, any amount owing under the Collaterally Assigned Note, or modify or compromise any rights under the Collaterally Assigned Deed of Trust, without the prior written consent of Lender. For purposes of effecting collection only, Borrower shall be deemed the owner of the Collaterally Assigned Note and the holder thereof except to the extent of Title Company’s or Lender’s physical possession of the Collaterally Assigned Note for purposes of continuing the perfection of Lender’s security interest in the Collaterally Assigned Note. Immediately upon the execution of this Agreement, Borrower will commence all appropriate steps to cause a trustee sale to be made of the property which is the subject of the Collaterally Assigned Deed of Trust.

7.

Borrower’s Obligations With Respect to the Collaterally Assigned Note. Borrower shall use his best efforts to collect the amounts owing under the Collaterally Assigned Note, and all such efforts shall be undertaken in his name and not in the name of Lender. Borrower agrees that he shall not hold himself out as, or represent himself to be, an agent of Lender. Until Borrower has paid the Note to Lender in full: a. Borrower shall remit to Lender all amounts collected with respect to the Collaterally Assigned Note and any security therefor, which amounts shall be applied first to reduce any accrued and unpaid interest, costs and expenses, and second to reduce the principal balance of the Note; b. Borrower shall be solely responsible for all legal and appraisal costs and expenses, including all professional fees, court costs, and other costs incurred in connection with the collection of the Collaterally Assigned Note and the enforcement of the Collaterally Assigned Deed of Trust. c. Borrower shall, from time to time as requested by Lender, submit to Lender a statement showing the amount of payments received with respect to the Note, the date each payment was received, the party making the payment and the remaining balance of the Note. d. At any trustee sale with respect to the Collaterally Assigned Deed of Trust, Borrower shall credit bid on Lender’s behalf an amount that is not less than the total amount due and owing under the Collaterally Assigned Note.

8.

Borrower Deed of Trust. Contemporaneously herewith, Borrower shall execute and deliver to Lender a deed of trust in form satisfactory to Lender (“Borrower’s Deed of Trust”) with respect to the property that is the subject of the Collaterally Assigned Deed of Trust. The Borrower Deed of Trust may be recorded by Lender at any time prior to or contemporaneously with the recordation of any trustee’s deed to Borrower resulting from a trustee sale under the Collaterally Assigned Deed of Trust.

9.

Lender’s Consent. Lender hereby: a. Consents to the execution of a notice of substitution, substituting Borrower as beneficiary under the Collaterally Assigned Deed of Trust. b. Consents to the commencement of a trustee’s sale under the Collaterally Assigned Deed of Trust pursuant to notice of sale, on behalf of Borrower as the nominal beneficiary under the Collaterally Assigned Deed of Trust.

c.

10.

To the extent necessary, and by its execution of this Agreement joins in the appointment of the successor trustee pursuant to a notice of substitution, and hereby authorizes, ratifies, and confirms the power and authority of the successor trustee to execute, record, and process a notice of sale, and hereby joins in the execution of any statement of breach executed by Borrower in connection with a notice of sale with respect to the Collaterally Assigned Deed of Trust.

Effective Term. Paragraph 7 of this Agreement shall continue in full force and effect until ___________, 20__, or the final collection or settlement of all amounts owing under the Note, or the date Lender gives notice to Borrower of the revocation of his authority as collection agent, whichever first occurs.

[Standard Clauses, Signature Block(s) and Notarial Acknowledgment(s), as appropriate] Form 10A.26