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ARC Systems Wins 'Fix-It' Award

Prestigious Honor from 'Mortgage Technology Magazine' Acknowledges Company's Advanced Warehouse ASP

Austin, Texas October 18, 2003 - ARC Systems, a leading mortgage technology Application Service Provider (ASP), has gratefully accepted one of the industry's most prestigious awards.

The company won the annual "Fix-It Award" from Mortgage Technology Magazine, given each year to a company that brings technology to bear to fix a specific mortgage-industry problem.

ARC Systems won the award this year for its warehouse lending automation technology, called "LendTech Warehouse," which is delivered as a hosted solution via the ASP model.

"We see the LendTech Warehouse product as an excellent example of the value ASP solutions have for the mortgage industry in bringing technology tools to bear quickly and affordably to solve particular problems," the magazine's editors stated in their November/December 2003 edition. It was released at the Annual Convention of the Mortgage Bankers Association of America in San Diego.

The award citation notes that LendTech Warehouse is "working at Cincinnati-based PCFS Mortgage Resources, the mortgage division of Provident Bank." The ARC Systems product was created to decision loans in conjunction with a preferential pricing offer for lenders in the warehouse business channel.

"The system's 'sweep' process passes a mortgage application or loan against an individual bank's underwriting guidelines and additional investor guidelines, enabling loans to be sold to different buyers at different pool percentage rates and ensuring that a particular loan meets the buying guidelines of the bank or other investor," the magazine states.

It reports that ARC Systems had two primary objectives when it set out to create the warehouse product. Quoting company CFO Wayne Pike, they were: "To enhance the speed of getting these loans on the books for the client, and offer the ability to 'police' these loans for quality and risk prior to placing them on a warehouse line."

ARC's Preferential Pricing Module enables correspondents to choose whether to put the loan on their warehouse line or sell directly to the lender for its portfolio, the report explains.

In the magazine story, ARC Systems President Ed Jones states: "Our clients don't want to have loan products in their pools that they are unable to sell. LendTech allows them to ensure that the loan applications being submitted and funded meet their guidelines, as well as the guidelines of other investors. This assures that they won't get 'stuck' with a bad product."