ARM Disclosure

Generic ARM Disclosure

This disclosure notice is given to you in connection with your application for an adjustable-rate mortgage loan with DAS

Acquisition Co, LLC, and provides information that you should read. An adjustable-rate mortgage loan (“ARM”) is a type

of loan that permits changes in the loan interest rate. Such changes generally are based on changes in an index, and

normally result in an increase or decrease in the regular monthly loan payment. The purpose of this disclosure notice is to

explain the ARM program you are considering. Information on other ARM programs is available on request.

Your interest rate will be based on an index rate plus a margin. The initial rate may be a discounted or premium rate. The

interest will be based on the weekly average yield on United States Treasury securities adjusted to a constant maturity of

1 year (the index), plus our margin, rounded to the nearest 0.125%. Ask us for our current interest rate, margin and

currently available discounts. Information about the index is published weekly in the “Wall Street Journal”. Since

movement of the index is usually related to market conditions that cannot be predicted, it is impossible to know in advance

exactly how much interest you will have to pay over the life of the loan. Your interest rate will equal the index plus our

margin unless your interest rate “caps” limit the amount of change in the interest rate. Your payment will be base don the

interest rate, loan balance, and loan term.

Your interest rate will remain fixed for an initial term, depending upon the specific ARM Program you select. After the

initial fixed rate period, your interest rate and monthly payment can change yearly thereafter (each date on which your

interest is scheduled to change is called a “Change Date”). The following are examples for each ARM Product. The initial

interest rate used in these examples is the rate available as of March 18, 2003, at 1:58 p.m.

Your interest rate will remain fixed for an initial term, depending upon the specific ARM Program you select. In addition,

your monthly payment amount will consist of INTEREST ONLY during the initial fixed rate period. After the initial fixed

rate period, your interest rate can change yearly thereafter. Your monthly payment amount will consist of both Principal

and Interest after the initial fixed rate period and will be base don the remaining loan balance and loan term. Principal and

Interest payments will be required for the remaining term of your loan. Your Interest Rate and monthly Principal and

Interest payment can change yearly and will be based on the current Index, Margin and applicable rate caps, as described

above. Interest First ARM Loans will only be available on loans with an original loan term of 30 years.

The interest rate cannot increase or decrease more than two-percentage points (2.000%) per year. Increases in your

interest rate over the life of your loan will be limited to six percentage points (6.000%) above the initial interest rate.

For a $10,000.00, 30-year loan with an initial rate of 2.875% (this rate is based on the index (1.291%) plus the margin

(2.750%) less a discount of 1.125%). The maximum amount that the interest rate can raise is six percentage points to

8.875%. The monthly payment can rise from a first year payment of $41.49 to a maximum of $77.46 in the fourth year.

For a $10,000.00, 15-year loan with the same initial interest rate, the maximum amount that the interest rate can raise is

six percentage points to 8.975%. The monthly payment can rise from first year payment of $68.46 to a maximum of

$96.51 in the fourth year.

The interest rate cannot increase or decrease more than two-percentage points (2.000%) per year. Increases in your

interest rate over the life of your loan will be limited to six percentage points (6.000%) above the initial interest rate.

For a $10,000.00, 30-year loan with an initial rate of 3.125% (this rate is based on the index (1.291%) plus the margin

(2.750%) less a discount of .875%). The maximum amount that the interest rate can raise is 6 percentage points, to

9.125%. The monthly payment can rise from a first year payment of $42.84 to a maximum of $78.12 in the fifth year. For

a $10,000.00, 15-year loan with the same initial interest rate, the maximum amount that the interest rate can raise is 6

percentage points to 9.125%. The monthly payment can rise from a first year payment of $69.66 to a maximum of $95.81

in the fifth year.

The interest rate cannot increase or decrease more than two-percentage points (2.000%) per year. Increases in your

interest rate over the life of your loan will be limited to six percentage points (6.000%) above the initial interest rate.

For a $10,000.00, 30-year loan with an initial rate of 3.750% (this rate is based on the index (1.291%) plus the margin

(2.750%) less a discount of 0.250%). The maximum amount that the interest rate can raise is 6 percentage points, to

9.750%. The monthly payment can rise from a first year payment of $46.31 to a maximum of $81.64 in the sixth year.

Generic ARM Disclosure

For a $10,000.00, 15-year loan with the same initial interest rate, the maximum amount that the interest rate can rise is 6

percentage points to 9.750%. The monthly payment can rise from a first year payment of $72.72 to a maximum of $97.36

in the sixth year.

The interest rate cannot increase or decrease more than two-percentage points (2.000%) per year. Increases in your

interest rate over the life of your loan will be limited to six percentage points (6.000%) above the initial interest rate.

For a $10,000.00, 30-year loan with an initial interest rate of 4.250% (this rate is based on the index (1.291%) plus the

margin (2.750%) plus a premium of 0.250%). The maximum amount that the interest rate can raise is 6 percentage points

to 10.250%. The monthly payment can rise from a first year payment of $49.19 to a maximum of $83.13 in the eighth

year. For a $10,000.00, 15-year loan with the same initial interest rate, the maximum amount that the interest rate can

raise is 6 percentage points to 10.250%. The monthly payment can rise from a first year payment of $75.23 to a

maximum of $95.92 in the eighth year.

The interest rate cannot increase or decrease more than two-percentage points (2.000%) per year.

Increases in your interest rate over the life of your loan will be limited to six percentage points (6.000%) above

the initial interest rate.

For a $10,000.00, 30-year loan with the initial interest rate of 4.250% (this rate is based on the index of

(1.291%) plus the margin (2.750%) plus a premium of 0.250%). Your monthly INTEREST ONLY payment will

be $35.42 for the first five years. Your interest rate can rise to 6.250% in the sixth year and your monthly

PRINCIPAL AND INTEREST payment can rise to $65.97 in the sixth year. The maximum amount that the

interest rate can raise is 6 percentage points (6.000%) to 10.250% in the eighth year and your monthly Principal

and Interest payment can rise to $91.54 in the eighth year.

On the First Change Date, your interest rate cannot increase or decrease by more than six percentage points (6.000%).

Thereafter, you interest rate cannot increase or decrease by more than two percentage points (2.000%) on any Change

Date. Increases in your interest rate over the life of your loan will be limited to six percentage points (6.000%) above the

initial interest rate.

For a $10,000.00, 30-year loan with an initial interest rate of 4.750% (this rate is based on the index (1.291%) plus the

margin (2.750%) plus a premium of .750%). The maximum amount that the interest rate can raise is 6 percentage points

to 10.750%. The monthly payment can rise from a first year payment of $52.16 to a maximum of $88.03 in the sixth year.

For a $10,000.00, 15-year loan with the same initial interest rate, the maximum amount that the interest rate can raise is 6

percentage points to 10.750%. The monthly payment can rise from a first year payment of $77.78 to a maximum of

$101.15 in the sixth year.

On the First Change Date, your interest rate cannot increase or decrease by more than six percentage points

(6.000%). Thereafter, your interest rate cannot increase or decrease by more than two percentage points

(2.000%) on any Change Date. Increases in your interest rate over the life of your loan will be limited to six

percentage points (6.000%) above the initial interest rate.

For a $10,000.00, 30-year loan with an initial interest rate of 4.750% (this rate is based on the index (1.291%)

plus the margin (2.750%) plus a premium of .750%). Your monthly INTEREST ONLY payment will be $39.59

for the first five years. Your interest rate can rise to 10.750% in the sixth year and your monthly PRINCIPAL

AND INTEREST payment can rise to $96.21 in the sixth year.

On the First Change Date, your interest rate cannot increase or decrease by more than five percentage points (5.000%).

Thereafter, your interest rate cannot increase or decrease by more than two percentage points (2.000%) on any Change

Date. Increases in your interest rate over the life of your loan will be limited to five percentage points (5.000%) above the

initial interest rate.

For a $10,000.00, 30-year loan with an initial interest rate of 4.500% (this rate is based on the index (1.291%) plus the

margin (2.750%) plus a premium of .500%). The maximum amount that the interest rate can rise is 5 percentage points to

9.500%. The monthly payment can rise from a first year payment of $50.67 to a maximum of $77.71 in the eighth year.

For a $10,000.00, 15-year loan with the same initial interest rate, the maximum amount that the interest rate can rise is 5

percentage points to 9.500%. The monthly payment can rise from a first year payment of $76.50 to a maximum of $91.82

in the eighth year.

Generic ARM Disclosure

On the First Change Date, your interest rate cannot increase or decrease by more than five percentage points

(5.000%). Thereafter, your interest rate cannot increase or decrease by more than two percentage points

(2.000%) on any Change Date. Increases in you interest rate over the life of your loan will be limited to five

percentage points (5.000%) above the initial interest rate.

For a $10,000.00, 30-year loan with an initial interest rate of 4.500% (this rate is based on the index (1.291%)

plus the margin (2.750%) plus a premium of .500%). Your monthly INTEREST ONLY payment will be $37.50

for the first seven years. Your interest rate can rise to 9.500% in the eighth year and your monthly PRINCIPAL

AND ITEREST payment can rise to $89.30 in the eighth year.

The discounts/premiums used in these examples are discounts/premiums we have used recently; your discount/premium

may be different. These examples are based on a $10,000 loan amount. To see what your payments would be, divide

your mortgage amount by $10,000; then multiply the monthly payment used in the applicable example by that amount.

For example, the monthly payment for a mortgage amount of $60,000 would be $60,000/$10,000=6; 6X the example

payment amount + your monthly payment. Using the One-Year ARM Loan example above, the monthly payment for a

$60,000, 30-year mortgage, will be $60,000/$10,000=6; 6 X $41.49 = $248.94 per month.

You will be notified in writing at least 45 days before the annual payment adjustment may be made. This notice will

contain information about changes in the interest rate, payment amount, and loan balance.

Information about our other adjustable rate loan programs is available upon request.

Your loan may include an option to convert to a fixed rate loan, which can be exercised any time within the first five years

of the loan term. There is no charge for converting your loan. Your interest rate may increase should you elect to

convert. The fixed interest rate will be base don the Federal Home loan Mortgage Corporation 30 day mandatory delivery

rate plus a margin, rounded up to the next highest .125%. The fixed rate of interest will not exceed the limitation on

increases in your interest rate over the life of your loan, as described above. This information is representative of the

conversion features recently offered. Interest First ARM loans and Seven to One ARM loans do not have an option to

convert. Check with lender for other specific restrictions and requirements.

Please sign this disclosure, and return the original to DAS Acquisition Co, LLC.

I/We acknowledge receiving a copy of and reading the above disclosure notice and Adjustable Rate Handbook.

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Applicant’s Signature Date

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Applicant’s Signature Date