Risk Factors Update Summary

• The average loan-to-value (LTV) ratio decreased from 67% to 66% and the weighted average LTV of acquired loans decreased from 58% to 56%.
• Change in title and lien priority rights may impact ABS issued by securitization entities.
• The combined unpaid principal balance of loans increased from $181 million to $226 million.
• Change in excess interest collections may affect payments on notes, potentially increasing costs.
• The lack of liquidity in assets may lead to losses, with 8.9% of loans more than 60 days delinquent.
• Holding excess MSRs below 95% may impact assets and ownership limits.
• Fitch downgraded the U.S. government's sovereign credit rating to AA+, affecting borrowing costs.
• Changes in monetary policies and geopolitical tensions may increase global currency exchange volatility.
• The company may face disruptions in access to capital and increased borrowing costs due to financial sector instability.
• The company's dependence on Waterfall for personnel and conflicts of interest pose operational risks.