The primary lending objective of Liberty Home Financial is to encourage people to own their own homes, while protecting our depositors.

In compliance with the federal Equal Credit Opportunity Act, Liberty Home Financial does not discriminate in any credit transaction because of an applicant's race, color, national origin, religion, sex, marital status, age, familial status, handicap, the receipt of public assistance, or the borrower's good faith exercise of rights under the Consumer Credit Protection Act.

In compliance with the Fair Housing Act, Liberty Home Financial does not discriminate in any aspect of a residential real estate transaction because of an applicant's race, color, national origin, religion, sex, marital status, age, familial status, handicap, the receipt of public assistance, or the borrower's good faith exercise of rights under the Consumer Credit Protection Act.

We do not discriminate when reviewing a property based on the condition, characteristics or trends in a neighborhood or geographic area surrounding the property - consistent with sound lending practices.

Liberty Home Financial does not deny credit because of any minimum income rule. Also, a prior criminal record doesn't necessarily prevent an applicant from getting a loan. We evaluate all applicants against Liberty Home Financial's guidelines and lending standards, with emphasis on recent behavior and present circumstances.

Liberty Home Financial invites all persons interested in obtaining a loan to file an application with Liberty Home Financial. Applicants may apply in person at any of our convenient branch locations, by telephone (970)945-7210 or over the Internet at www.libertyhomefinancial.com. A current listing of all of our branches and locations, as well as information on our geographic lending areas, can be found on our website or you may call (970)945-7210 for the Liberty Home Financial location nearest you. Described herein are general guidelines we use in evaluating all consumer and residential loan applications. These are guidelines only - compensating factors may be considered for any exception to our guidelines or lending standards.

Liberty Home Financial evaluates each loan application we receive and supporting documentation to make a decision. The supporting documentation may include, as applicable, the following items: completed appraisal, recent credit report, employment, income and deposit verification, and any other support documentation we may deem necessary during our evaluation of the application.

Liberty Home Financial evaluates the following areas, as applicable, before making a decision on a loan application:

1. The Property - must be adequate security for the proposed loan.
2. Credit Analysis - must indicate the applicant's ability and willingness to repay the proposed loan on schedule.
3. Income - must sufficiently cover the cost of living expenses, and we must be able to reasonably assume the income will continue.
4. Available Funds - must cover all closing costs, reserve requirements and the down payment.

EVALUATION AREAS

Owner Occupied 1-4 Unit Loans:

The Property
We do not exclude a property because of any maximum property age, minimum square footage, minimum loan amount, or minimum purchase price. Instead, we emphasize the property condition and its marketability. Our appraisal analyzes the current value of the property, considering any factors identified that might affect its value.

The income, market, and cost approaches are three generally accepted evaluation methods used in an appraisal. Liberty Home Financial usually emphasizes the market approach for single family residences. The property is compared with recent prices paid for similar properties in the immediate area. This comparison is adjusted to compensate for time of sale, recent market conditions, location, construction quality, condition, size, and other significant features.

In conjunction with the market value analysis, the appraiser evaluates the property to determine if there are adverse conditions that would affect its marketability. Such conditions may include:

1. Physical deterioration of the property that may result in potential harm to occupants.
2. Physical deterioration of other properties in the immediate area or evidence of extensive property abandonment in the area that may indicate near-term widespread value decreases.
3. History of (or identified potential for) property damage from local geological conditions or environmental risk, such as floods, landslide areas, ground contamination or toxic materials.
4. Identified likely zoning changes that would have a negative impact on market value.

The above factors are not always identifiable at the time of the appraisal. So, when Liberty Home Financial approves a loan, we do not guarantee the present or future absence of any influencing conditions or the value of the property. The loan applicant should carefully and independently evaluate the property. The applicant should not rely upon our appraisal or evaluation to make a determination of the condition of the property and its surroundings.

2. Credit Analysis
Pioneer Mortgage Company reviews each applicant's credit record. One indication of good credit is the timely repayment on current and previous debts. An applicant with a history of financial problems may still be eligible for a loan. It depends on recent credit history and the adequate explanation of prior credit difficulties. We may require an explanation if the applicant has a recent history of slow payments on an existing or previous home loan or other installment debts, or a bankruptcy.

An applicant with current financial difficulties might not qualify for a loan now. But, the applicant can submit a future application for review when new information becomes available.

We do not deny credit because of limited credit history. Liberty Home Financial also considers non-traditional credit references, such as letters from utility companies and landlords when appropriate in evaluating an applicant's credit.

3. Income
The applicant's income should sufficiently cover living and housing expenses and other debts so the total payments do not become a burden. Monthly housing expenses include the loan payment, second mortgage payment (if any), taxes and insurance, maintenance fees, homeowners' association dues and assessments. Other debts include revolving and installment payments, if any, such as credit cards and car loans (excluding those that will be paid off in approximately 10 months), and spousal and child support payments.

Generally, the housing expense and other debts should not exceed 36% - 40% of the applicant's stable gross monthly income. We base this percentage range - as a general rule of thumb - on past experience. Liberty Home Financial also may consider applicants who show a satisfactory history of paying a larger share of income toward housing expenses and debts than indicated above.

Stable monthly income means the total salary or retirement benefits plus additional income (if applicable) from continuous sources such as: overtime, bonuses, commissions, dividends/interest, net rental income, part-time work, public assistance payments, and spousal and child support payments. Liberty Home Financial considers the additional income part of stable income only if it is supported by previous history and, based on foreseeable circumstances, it is expected to continue. We may also consider a potential income increase.

With two or more applicants, we will consider the income of each - and count it toward stable monthly income (as described above).

4. Available Funds
Besides stable income, we evaluate the applicant's liquid assets to ensure the applicant has sufficient funds to close the loan and that assets support the monthly income claimed.

The source of funds for closing costs (such as, cash in escrow, savings on deposit or securities to be sold) must be identified, especially for home purchases.

Refinance Loans
Besides evaluating the previous four evaluation areas, we also place emphasis on the applicant's payment record for the existing loan.

Non-Owner Occupied Property 1-4 Unit Loans

Liberty Home Financial makes loans on non-owner occupied 1-4 unit properties. Projected net income (loss) from the rental property (net of operating expenses and a vacancy) will be considered as income (debt, if loss) when evaluating the applicants. We consider the applicant's own housing expense as debt.

Additional Terms and Conditions

Additional terms and conditions may be contained in the loan documents, such as:

1. A provision stating Liberty Home Financial may assess a late charge if a loan payment is not made on time.
2. A requirement that the borrower provide the following insurance coverage: hazard, title, flood (where applicable) and private mortgage, as applicable.
3. Liberty Home Financialright to accelerate and thereby make the entire loan amount due and payable prior to maturity - or to foreclose on the property, or other collateral securing the loan, if any - if certain obligations are not met.
4. A provision allowing Liberty Home Financial to assess a fee for the right to prepay the entire loan (or part of it) prior to maturity.
5. Modification of standard terms if Pioneer Mortgage Company's review of property, credit and income shows the loan and borrower may involve some risk.

OTHER TYPES OF LOANS

Multiple Residential Units and Commercial Income Property Loans

When evaluating the application, we analyze the applicant's financial condition as well as the property. Regarding the property, we place strong emphasis on the following: cash flow, vacancy factor, capitalization rate, market demand and conditions.

The applicant's income and liquid reserves are important considerations during qualification - especially when relating to the applicant's ability to handle possible cash flow adversities (temporary cash flow reductions due to higher vacancies or abnormally high maintenance or replacement expenses, for example).

Construction Loans
Liberty Home Financial may consider making construction loans.

Home Equity Loans and Lines of Credit
Home equity loans are available on owner-occupied, 1-4 unit properties. In evaluating the loan application, we place emphasis on the property, the applicant's credit and income and, as applicable, available funds.

Loans Secured by Deposit Accounts
Pioneer Mortgage Company offers loans secured by qualifying deposit accounts (other than retirement accounts).

For Information or Assistance
Pioneer Mortgage Company representatives are available to provide you with further information about our loan products, including the availability of our loans in your area, and to assist you in submitting a Pioneer Mortgage Company loan application.

To contact us or apply over the Internet:
     » Go to www.libertyhomefinancial.com

To locate the Liberty Home Financial office nearest you or to apply by telephone:
     » Call (970)945-7210 or check our website.

Residential Lending (Purchase and Refinance Loans):
     » Call (970)945-7210 to speak to a Loan Officer or check our website.

Home Equity Loans and Home Equity Lines of Credit:
     » Call (970)945-7210 to speak to a Loan Officer or check our website.

Commercial Lending and Construction Loans:
     » Call (970)945-7210 to speak with a Commercial Loans representative or check our website.

Customer Service Assistance regarding an existing a Liberty Home Financial Loan:
     » Call (303)996-0539 to speak with a Customer Service Representative.

General Information
The above information complies with federal fair lending laws and regulations and the requirements of Code of Federal Regulations, Title 12, Section 528.2a. The contents are general and do not detail Pioneer Mortgage Company's complete loan policy, geographic lending areas or underwriting guidelines. If you think you have been discriminated against, you may write to the Director, Consumer Affairs, Office of Thrift Supervision, Washington, DC, 20552, and the Assistant Secretary for Fair Housing and Equal Opportunity, Department of Housing and Urban Development, Washington, DC 20410, or consider filing a civil suit under federal laws.