410/789.8400

Stewart Title Guaranty Company
609 Global Way - Suite 122
Linthicum Heights, MD 21090
410/789.8400
410/789.8407 fax

TO: All Maryland Agents
FROM: Patricia A.Lehr
DATE: February 17, 2004
RE: ALTA Short Form Expanded Coverage Residential Loan Policy

We are pleased to announce that the Short Form Expanded Coverage Residential Loan Policy w,, recently filed with the Maryland Insurance Administration. The ALTA Expanded Coverage Residential Loan Policy was designed to afford lenders who make loans secured by one-to-four family residential property many of the same expanded coverages provided by the ALTA Homeowner's Policy, as well as a number of additional coverages unique to lenders.

The addendum to the Short Form Expanded Coverage Residential Policy, when attached, would be used to show any special exceptions on a case-by-case basis, after examination of title, such as specific liens or Mortgages or Deeds of record. These specialized items could change from file to file so the addendum allows us to refer to these title conditions as they related to each specific property. The addendum then is just an expansion of the standardized exceptions found in Schedule "B" of the policy. The need for the additional exceptions listed on the Addendum, wizen it is attached to the policy, have been revealed when the complete search of tide matters was performed.

The policy significantly expands on the coverage of the existing ALTA loan policy. The additional coverage and features include:

• 25% inrease in the usual amount of insurance(to 125% of the Amount of Insurance stated in Schedule "A")
• Revolving credht and mortgage modification coverage(as to future advances made pursuant to the terms of the lender's mortgage or advances and interest rate changes made as a result of post-policy modifications to tire mortgage)
• Protection against certain "post-pokcy" risks including forgery of any instrument purporting to affect the lender's mortgage or the underlying title, encroachments from an adjoining property onto the subject land or from the subject land onto adjoining property or over an easement or set back line, and mechanics' and materialmen's fines (those resulting from work contracted for in the future but involving a claim of priority over the lender's mortgage)
• Enhanced access coverage (affords actual pedestrian and vehicular access coverage based on legal right)
• Broad survey coverage (covers loss resulting from "any violation, variation or adverse circumstances affecting title that would have been disclosed by an accurate survey")