Service Agreement
This Service Agreement ("Agreement") is entered into between Xpress Loan Processing ("Xpress" or "Company") and the licensed California mortgage broker or entity ("Client") who engages Xpress for processing services. This Agreement is binding upon Client's submission of the first loan file or execution of Xpress's onboarding form, whichever occurs first. By engaging Xpress's services, Client agrees to all terms set forth below. Last updated: April 2025.
1. Scope of Services
Xpress provides contract-to-close mortgage processing services exclusively for California-licensed mortgage brokers. Services include: (a) loan file setup and review; (b) borrower document collection and coordination; (c) underwriting submission preparation; (d) condition clearing and lender follow-up; (e) closing coordination. Supported loan programs include Conventional, FHA, VA, USDA, Jumbo, and Non-QM. Each Client is assigned a dedicated processor for continuity and accountability. Services expressly excluded include: loan origination, loan officer duties, appraisal ordering, title or escrow services, and any activity requiring a separate MLO license not held by the assigned processor. Xpress reserves the right to decline non-standard loan programs or files that fall outside its standard processing scope, with notice to Client.
2. Service Level Agreements (SLAs)
Xpress commits to the following measurable performance standards: (a) Initial file review and submission: within 3-5 business hours of receiving a complete loan file; (b) Response time to Client inquiries: within 1-2 business hours during business hours (Monday-Friday, 8:00am-6:00pm Pacific Time, excluding federal holidays); (c) Condition clearance rate: target of 93.7%, measured on a rolling 90-day basis. If Xpress fails to meet any SLA commitment, Client will receive a 5% fee credit on the affected file. SLA obligations do not apply where delays are caused by: incomplete file submissions, borrower non-responsiveness, lender or third-party system outages, Client-side delays, or force majeure events. Two consecutive calendar months of SLA failure constitutes grounds for termination for cause by Client, subject to Section 16.
3. Fees and Payment
Per-file pricing is volume-based: $399/file for 1-25 files/month; $299/file for 26-50 files/month; $199/file for 50+ files/month. Fees are due upon file completion (defined as loan closing, denial, or withdrawal). Xpress will submit invoices via email within 2 business days of completion; payment is due Net 15 from invoice date. Unpaid invoices are subject to a late fee of 1.5% per month on the outstanding balance beginning 30 days after invoice date. Xpress reserves the right to update pricing with 30 days written notice. Fee Dispute Process: Client must notify Xpress in writing of any disputed invoice within 10 business days of receipt. Xpress will respond within 10 business days with documentation. Client may withhold only the disputed portion of an invoice (not the full amount) pending resolution. Unresolved fee disputes escalate to the dispute resolution process in Section 17.
4. RESPA Section 8 Compliance
All fees paid under this Agreement are solely for mortgage processing services actually performed. This Agreement does not involve kickbacks, referral fees, fee-splitting, or any "thing of value" as prohibited by the Real Estate Settlement Procedures Act (RESPA) Section 8, 12 U.S.C. § 2607. Neither party shall give, receive, or accept any gift, compensation, promotional item, or special rate contingent upon the referral of settlement service business in connection with any federally-related mortgage loan. Xpress will not split fees with any unlicensed or unauthorized party. Both parties certify their understanding of and compliance with RESPA Section 8 requirements, and each shall promptly notify the other of any practice that may constitute a violation.
5. Independent Contractor Status
Xpress is an independent contractor and not an employee, partner, or agent of Client. Xpress controls the method, manner, and means by which processing services are performed. Xpress serves multiple clients and operates as an independently established business. Client does not direct, supervise, or control how Xpress performs its services; Client's role is limited to providing loan files and required documentation. Xpress is responsible for its own taxes, insurance, benefits, and business expenses. This Agreement imposes no exclusivity requirement on Xpress. Nothing herein shall be construed to create an employment, joint venture, or agency relationship. Xpress is not eligible for Client's employee benefits, workers' compensation, or unemployment insurance.
6. Licensing and Compliance Certifications
Client represents and warrants that it holds, and will maintain throughout the term of this Agreement, all required state and federal licenses including NMLS registration, California DRE or DFPI licensure, and any applicable MLO license endorsements. Client certifies that no principal, owner, or designated employee appears on any Fannie Mae, Freddie Mac, FHA, or CFPB exclusionary or ineligible party list. Client further warrants compliance with all applicable fair lending, RESPA, TILA, and Equal Credit Opportunity Act requirements. Xpress warrants that its team members hold all credentials required to perform the contracted services, have passed appropriate background checks, and do not appear on any federal or state exclusionary lists. Both parties agree to notify the other within 3 business days of any licensing lapse, exclusionary list placement, or material compliance issue.
7. Data Privacy and Security
Xpress handles non-public personal information (NPI) of borrowers and will comply with all applicable privacy laws. GLBA Safeguards Rule: Xpress will implement and maintain administrative, technical, and physical safeguards to protect all borrower NPI, including encryption of data in transit and at rest, access controls limited to team members assigned to each specific file, and maintained audit trails of file access. CCPA/CPRA: Xpress acts as a "Service Provider" under the California Consumer Privacy Act and will not sell, retain beyond service necessity, or use borrower personal information for any purpose other than performing services under this Agreement. Xpress will cooperate with Client in responding to consumer access or deletion requests within applicable legal timeframes. Data Breach Response: Xpress will notify Client within 24 hours of discovering any unauthorized access to, or suspected breach of, borrower or Client data. Xpress will preserve evidence, cooperate with any forensic investigation, and assist with required notifications to affected parties in accordance with California law. Data Destruction: Within 30 days of termination, Xpress will return or certify in writing the destruction of all Client and borrower data in its possession.
8. Wire Fraud and Cybersecurity
Xpress uses secure, encrypted communication channels for all sensitive borrower and transaction documents. Xpress will immediately alert Client upon detecting any suspicious requests to change wiring instructions, suspected email compromise, or other cybersecurity incidents. Xpress is not responsible for wire fraud losses arising from phishing, social engineering, business email compromise, or external cyberattacks, unless such losses result directly from Xpress's own negligence. Client is solely responsible for implementing dual-verification protocols for all wiring instructions and is strongly advised to verify any change in wiring instructions via a pre-confirmed phone number before executing any wire transfer. WARNING: Never change wiring instructions based on email or text communication alone. Always verify changes by calling a known, pre-confirmed number. Wire fraud targeting real estate transactions is increasingly common and both parties share a responsibility to remain vigilant.
9. Client Responsibilities
Client is responsible for: (a) submitting complete, accurate, and authentic loan files and borrower documentation; (b) ensuring that all submitted documents are unaltered and not fraudulent; (c) maintaining an active NMLS registration and all required state/federal licenses throughout each engagement; (d) providing Xpress with necessary LOS access, lender portal credentials, and system permissions; (e) responding to Xpress requests, questions, or file updates within 1 business day; (f) notifying Xpress promptly of any borrower changes, condition updates, program changes, or file withdrawals; (g) not submitting documents known or suspected to be false, forged, or misleading. Delays or losses caused by incomplete submissions, unresponsive borrowers, or late Client responses are not the responsibility of Xpress and do not constitute an SLA breach.
10. Confidentiality
"Confidential Information" means all non-public borrower personal and financial data, lender guidelines and pricing, Client business processes, file contents, and any proprietary information disclosed by either party in connection with this Agreement. Both parties agree to maintain strict confidentiality of all Confidential Information during the term of this Agreement and for 3 years following termination (indefinitely for trade secrets as defined under the California Uniform Trade Secrets Act, Cal. Civ. Code Section 3426). Permitted disclosures are limited to: named lenders processing the borrower's loan, state or federal regulators with lawful authority, and law enforcement with a valid legal process. Where permitted by law, the disclosing party will provide the other party prompt written notice before making any such disclosure. Upon termination, each party will return or certify in writing the destruction of the other party's Confidential Information within 30 days.
11. Indemnification
Client indemnifies Xpress for: Claims arising from Client's negligence, fraud, or misrepresentation Submission of false or forged documents Client's violation of law (RESPA, licensing, fair lending) Borrower claims arising from Client's origination activities.
Xpress indemnifies Client for: Claims arising from Xpress's negligence or errors in processing. Xpress's failure to maintain required credentials. Xpress's breach of data privacy obligations & Xpress's breach of this Agreement
12. Limitation of Liability
Xpress is not liable for: lender underwriting decisions, appraisal outcomes, title issues, rate lock expirations caused by lender/borrower delay, or borrower credit changes post-submission.
Xpress will exercise reasonable professional care to identify and flag discrepancies in submitted files (removes blanket disclaimer)
Liability cap: Total liability per file is capped at 3× the fee paid for that specific file (more defensible than 1× under CA unconscionability doctrine)
Xpress is not liable for consequential, indirect, or punitive damages Neither party can disclaim liability for gross negligence or willful misconduct
13. Intellectual Property
All borrower files, lender submissions, and loan-specific work product created during the engagement belong to Client. Xpress retains sole ownership of its pre-existing tools, templates, checklists, processing methodologies, and proprietary workflows developed independently of this engagement. All loan-specific materials generated under this Agreement are considered work product and will be returned to Client or certified as destroyed within 30 days of termination or upon written request. Neither party acquires any ownership interest in the other party's pre-existing intellectual property by virtue of this Agreement.
14. Force Majeure
Neither party shall be liable for delays or failure to perform caused by events beyond their reasonable control, including but not limited to: natural disasters, acts of God, government orders or regulations, declared pandemics or public health emergencies, utility or infrastructure failures, cybersecurity attacks on third-party systems, or outages of third-party platforms including Fannie Mae/Freddie Mac systems, NMLS, or Client's Loan Origination System (LOS). The affected party must notify the other in writing within 48 hours of the event. If the force majeure event continues for more than 30 consecutive calendar days, either party may terminate the affected file engagements without penalty. Force majeure relief is not available to a party if backup systems, processes, or workarounds were reasonably available and were not utilized.
15. Non-Solicitation and Non-Circumvention
For a period of two (2) years following termination of this Agreement, neither party shall directly solicit for employment or contract any employee, contractor, or team member of the other party without prior written consent. Xpress agrees not to contact Client's borrowers, referral sources, or lender relationships for the purpose of offering competing or similar processing services. Client agrees not to directly hire, engage, or contract any individual Xpress processor to circumvent the terms of this Agreement. These restrictions apply to direct solicitation and intentional circumvention only. No provision of this Agreement shall be construed as a non-compete restriction on either party's general business activities, as such restrictions are unenforceable under California Business and Professions Code § 16600.
16. Term and Termination
This Agreement is effective on a per-file basis upon submission of Client's first loan file. Either party may terminate this Agreement for convenience with 30 days' prior written notice. Client may terminate for cause if Xpress fails to meet SLA standards for two or more consecutive calendar months, commits a material breach that is not cured within 15 business days of written notice, or loses required professional credentials. Xpress may terminate for cause if Client fails to remit payment within 45 days after written notice of delinquency, submits documents known or suspected to be fraudulent, or permits any required mortgage license to lapse without immediate remediation. Upon termination, Xpress will complete all loan files actively in process at the time of notice and will transfer complete file documentation to Client within 10 business days. Sections covering Confidentiality, Indemnification, Limitation of Liability, Data Privacy, and Intellectual Property survive termination for three (3) years; IP ownership provisions survive indefinitely.
17. Dispute Resolution
The parties agree to resolve disputes through the following tiered process: (1) Informal Resolution — either party may initiate good-faith discussions; the parties will have 15 business days to reach a mutually acceptable resolution. (2) Senior Management Escalation — if informal resolution fails, each party's senior management representative will attempt resolution within an additional 15 business days. (3) Non-Binding Mediation — if escalation fails, the parties will submit the dispute to non-binding mediation administered by JAMS within 30 calendar days. (4) Binding Arbitration — unresolved disputes shall be submitted to final and binding arbitration under the JAMS Comprehensive Arbitration Rules and Procedures, before a single arbitrator, held in Los Angeles County, California. Each party shall bear its own attorneys' fees; arbitration costs shall be split equally. All arbitration proceedings are confidential. Notwithstanding the foregoing, either party may seek emergency injunctive or equitable relief in a court of competent jurisdiction without prior arbitration for claims involving data security breaches or intellectual property infringement.
18. Governing Law and Jurisdiction
This Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to its conflict of law provisions. Any arbitration proceeding initiated under this Agreement shall be conducted in Los Angeles County, California. Both parties expressly consent to personal jurisdiction in the State of California for any action seeking emergency injunctive relief or to enforce an arbitration award. Nothing in this section limits the parties' obligation to first pursue informal resolution and arbitration as set forth in Section 17 before initiating court proceedings.
19. General Provisions
Assignment: Neither party may assign this Agreement or any rights hereunder without the prior written consent of the other party, which shall not be unreasonably withheld. This Agreement shall be binding upon and inure to the benefit of permitted successors and assigns. Entire Agreement: This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, warranties, and understandings. Modifications must be in writing and signed by authorized representatives of both parties. Severability: If any provision of this Agreement is held invalid or unenforceable, that provision shall be severed and the remaining provisions shall continue in full force and effect. Waiver: No waiver of any breach or default shall be deemed a waiver of any subsequent breach or default, and no waiver shall be effective unless made in writing. Counterparts and Electronic Signatures: This Agreement may be executed in counterparts, each of which shall constitute an original. Electronic signatures executed through platforms such as DocuSign or similar services are legally binding and shall have the same effect as original signatures. Legal Counsel: Each party is encouraged to consult independent legal counsel before executing this Agreement.
This Agreement was last updated: April 2025. This document is provided for informational purposes. Xpress Loan Processing recommends that both parties consult a licensed California attorney before execution.