Appraisal Independence Requirements

Policies & Procedures Governing Valuation Independence — AI-Native Private Credit & Commercial Real Estate Lending.

This Appraisal Independence Requirements ("AIR") Policy establishes the standards, controls, and procedures by which CR Equity AI, Inc. ("the Company," "CR Equity AI," "we") safeguards the independence, objectivity, and integrity of property valuations used in its lending activities. The Company is committed to ensuring that every valuation is developed by a qualified, independent party free from improper influence, coercion, or conflict of interest.

This Policy is designed to comply with the valuation independence provisions of the Truth in Lending Act ("TILA") and its implementing Regulation Z (12 C.F.R. § 1026.42), the appraisal-related provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Uniform Standards of Professional Appraisal Practice ("USPAP"), and the appraisal independence and quality requirements imposed by the Company's warehouse lenders, capital partners, and secondary-market investors.

This Policy applies to all directors, officers, employees, contractors, interns, and agents of CR Equity AI (collectively, "Covered Persons"), as well as to all appraisers, appraisal management companies ("AMCs"), and valuation vendors engaged by or on behalf of the Company.

Consumer-purpose credit.

The statutory valuation-independence requirements of Regulation Z apply to extensions of consumer credit secured by the consumer's principal dwelling. Where the Company originates or participates in any such transaction, full compliance with 12 C.F.R. § 1026.42 is mandatory.

Business-purpose credit.

Many of the Company's products (including DSCR, bridge, construction, and real estate loans) are business-purpose loans that may fall outside the technical scope of Regulation Z. Nonetheless, as a matter of sound risk management and to satisfy investor, warehouse, and securitization requirements, the Company applies the appraiser-independence principles set forth in this Policy to all valuations supporting a credit decision, regardless of loan purpose.

Governing principle

No person whose compensation or advancement is, or could reasonably be perceived to be, tied to the closing of a loan or to a target value may select, retain, compensate, or influence the appraiser or the outcome of any valuation.

This Policy incorporates and is to be interpreted consistently with the following authorities, each as amended from time to time:

• Truth in Lending Act, 15 U.S.C. § 1639e, and Regulation Z, 12 C.F.R. § 1026.42 (Valuation independence).
• Equal Credit Opportunity Act and Regulation B, 12 C.F.R. § 1002.14 (Appraisals and valuations — borrower disclosure and delivery).
• Title XIV of the Dodd-Frank Act and related interagency appraisal and evaluation guidelines.
• The Uniform Standards of Professional Appraisal Practice (USPAP) as promulgated by the Appraisal Standards Board.
• Applicable state appraiser licensing and AMC registration statutes in jurisdictions where the Company lends, including Florida and Virginia.
• Contractual appraisal-independence and quality requirements of the Company's warehouse lenders, forward-flow purchasers, and capital partners.

Where this Policy and an applicable legal, investor, or contractual requirement differ, the more stringent standard controls.

• Appraisal / Valuation. An estimate or opinion of the value of a property, whether prepared by a licensed or certified appraiser (an "appraisal") or developed through another method such as an automated valuation model, broker price opinion, or evaluation.
• AIVAA. The Company's proprietary AI underwriting and valuation engine. AIVAA-generated valuation outputs are subject to the model-governance and independence controls described in this Policy and in the Company's Quality Control Policy.
• Appraisal Management Company (AMC). A third party that administers a network of appraisers and provides appraisal-ordering, review, and quality-control services.
• Coercion. Any act intended to cause an appraiser to base an opinion of value on a factor other than the appraiser's independent professional judgment, including direct or indirect pressure, intimidation, bribery, extortion, or the withholding of payment or future business.
• Loan Production Function. Any person or unit whose responsibilities or compensation relate to the origination, sale, processing, or closing of loans, including sales, origination, and any officer or principal whose incentives are tied to loan volume or value outcomes.
• Valuation Management Function. The persons or unit responsible for ordering, managing, and reviewing valuations, operating independently of the Loan Production Function.

It is the policy of CR Equity AI that all valuations be performed independently, competently, and in accordance with USPAP and applicable law. The Company prohibits any action, by any Covered Person or third party, that would compromise or appear to compromise the independence of an appraiser or the integrity of a valuation.

Valuations must reflect the appraiser's own independent professional judgment and must not be influenced by any predetermined or "target" value, by the amount of a loan, by the contract price, or by the interests of any party to the transaction.

The Company maintains an organizational and procedural separation between the Loan Production Function and the Valuation Management Function:

• Valuations are ordered, managed, and reviewed by the Valuation Management Function (or an approved AMC), not by loan originators or any person whose compensation is tied to loan closing.
• No Covered Person in the Loan Production Function may select the specific appraiser for a transaction, negotiate the appraiser's fee, or direct the result of a valuation.
• Absolute lines of separation may be impractical given the Company's size. Where the same individual would otherwise perform both functions, the Company implements compensating controls — including documented review by an independent second party and the prohibitions in Section 7 — so that no person with a direct financial interest in loan closing influences valuation selection or outcome.
• Decisions to approve, deny, or price a loan are made independently of, and after, completion of the valuation.

No Covered Person and no agent of the Company may directly or indirectly engage in, or cause another to engage in, any of the following with respect to any appraiser or valuation:

• Coercing, influencing, bribing, intimidating, or attempting to influence an appraiser to reach a particular value or to disregard professional judgment.
• Requesting, encouraging, or directing an appraiser to report a minimum or predetermined value, or to match the contract price or loan amount.
• Withholding or threatening to withhold timely payment, or future business, because an appraiser does not return a value at or above a desired amount.
• Conditioning an appraiser's compensation or future engagement on the value reached or on loan consummation.
• Providing the appraiser with a target value, an anticipated value, an estimate of value, or the loan amount before or during the assignment (the contract price for a purchase transaction may be provided, consistent with USPAP).
• Implying, through words or conduct, that current or future engagements depend on the value reported.
• Removing an appraiser from an approved panel, or refusing to engage an appraiser, in retaliation for an independent, good-faith valuation.
• Altering, modifying, or falsifying a completed appraisal report, or directing an appraiser to do so.

Permitted, good-faith conduct

Nothing in this Policy prohibits a Covered Person from, in good faith: asking an appraiser to consider additional appropriate property information; requesting that the appraiser provide further detail, substantiation, or explanation for the value; correcting factual or clerical errors; or obtaining multiple valuations so long as the selection is not made to influence value. Reasonable efforts to ensure a competent, accurate, and USPAP-compliant valuation are expected.

Communications with appraisers must be conducted through, or with the knowledge of, the Valuation Management Function and must be documented in the loan file. Acceptable communications include providing the property address and access information, providing the executed sales contract on a purchase transaction, transmitting the assignment scope and timing, and requesting clarification or correction of demonstrable factual errors. Communications that suggest a desired value or that pressure the appraiser are strictly prohibited.

The Valuation Management Function maintains an approved panel of independent appraisers and AMCs. Engagement and panel decisions are governed by the following standards:

• Appraisers must hold the appropriate state license or certification, carry errors-and-omissions coverage where required, and demonstrate competency for the assignment's geography and property type.
• Selection from the panel is rotational or based on competency, geographic coverage, and capacity — never on a history of returning higher values.
• AMCs engaged by the Company must themselves be registered as required and must certify compliance with appraiser-independence and USPAP requirements.
• The Valuation Management Function conducts initial due diligence and periodic (no less than annual) re-validation of each panel appraiser and AMC, including license verification, disciplinary-history checks, and quality review.
• An appraiser may be removed from the panel only for documented, legitimate reasons — such as USPAP violations, demonstrated incompetence, ethical breaches, illegal conduct, or persistent quality or service failures — and never for returning an independent value that was lower than desired.

All valuations are ordered by the Valuation Management Function or an approved AMC. The order must specify the property, the intended use and intended user, the scope of work, and the required reporting form, and must not communicate any target value or loan amount. Orders, engagement letters, and all related correspondence are retained in the loan file.

The Company compensates fee appraisers at a rate that is customary and reasonable for comparable appraisal services in the geographic market of the property, consistent with 12 C.F.R. § 1026.42(f). Appraiser compensation is not contingent on the value reached, on loan consummation, or on any other condition that would compromise independence. Where an AMC is used, the appraiser's fee is disclosed and remains separate from the AMC's administrative fee. The Company pays appraisers on a timely basis.

Every appraisal must be developed and reported in conformity with USPAP and must satisfy the requirements of applicable investors and warehouse lenders. The Valuation Management Function (or its quality reviewers) evaluates each valuation for completeness, internal consistency, adequacy of support for the value conclusion, and compliance with the assignment scope. A request for correction or additional support is permitted; a request to change the value conclusion absent legitimate basis is prohibited.

AIVAA outputs.

Where the Company relies on AIVAA-generated valuation analytics, those outputs are subject to independent model governance, validation, and override-tracking controls. AIVAA analytics inform but do not coerce the independent appraiser, and any human override of an AIVAA value is documented with supporting rationale, consistent with the Quality Control Policy.

For applications subject to Regulation B (12 C.F.R. § 1002.14) — first-lien loans secured by a dwelling — the Company:

• Provides the applicant, no later than the third business day after receiving the application, a notice of the right to receive a copy of each appraisal or other written valuation developed.
• Provides a copy of each appraisal or written valuation promptly upon completion, or no later than three business days before consummation (or account opening), whichever is earlier.
• Does not charge for the copy of the valuation, although it may charge a reasonable fee for the cost of the valuation itself, subject to applicable law.

Applicants may waive the timing requirement consistent with the regulation, but a copy of any valuation must still be provided no later than consummation. Delivery and any waiver are documented in the loan file. For business-purpose loans outside Regulation B, the Company follows its standard disclosure practices and applicable investor requirements.

Consistent with 15 U.S.C. § 1639e(e) and 12 C.F.R. § 1026.42(g), any Covered Person who reasonably believes that an appraiser has materially failed to comply with USPAP or applicable law, or has otherwise engaged in unethical or unlawful conduct, must report the matter promptly to the Chief Compliance Officer. The Chief Compliance Officer will, where the failure is material, refer the appraiser to the appropriate state appraiser certifying and licensing agency within a reasonable period and maintain a record of the referral.

Any Covered Person who observes, suspects, or is asked to participate in a violation of this Policy must report it immediately to the Chief Compliance Officer or through the Company's confidential reporting channel. Reports may be made anonymously where permitted. The Company strictly prohibits retaliation against any person who, in good faith, reports a suspected violation, refuses to engage in prohibited conduct, or cooperates in an investigation.

The Company retains, for each transaction, all valuation orders, engagement letters, completed valuations, revision requests and responses, evidence of borrower delivery and any waiver, panel due-diligence records, and any related communications. Records are retained for the longer of (a) the period required by applicable law and investor requirements or (b) twenty-five (25) months from the date of action on the application, and in any event no less than the Company's standard retention schedule. Records are maintained securely and made available for regulatory, investor, and internal audit review.

All Covered Persons receive training on this Policy upon hire or engagement and no less than annually thereafter. Training covers prohibited conduct, separation of functions, permitted communications, mandatory reporting, and escalation procedures. Completion of training is documented and tracked by the Chief Compliance Officer.

Compliance with this Policy is monitored through the Company's Quality Control Program, including valuation reviews and periodic testing of the separation-of-functions controls. Violations are subject to disciplinary action up to and including termination of employment or engagement, and may be referred to regulators or law enforcement. Third parties who violate this Policy may be removed from the Company's approved panels and reported to applicable authorities.

The Chief Compliance Officer owns this Policy and is responsible for its administration, interpretation, and enforcement. This Policy is reviewed at least annually and upon any material change in law, regulation, or investor requirement. Material amendments are approved by the Chief Executive Officer (or the Board or its designee). A record of versions, approvals, and review dates is maintained as part of the Company's policy register.

I acknowledge that I have received, read, and understand the CR Equity AI, Inc. Appraisal Independence Requirements Policy and Procedures. I agree to comply with this Policy and to report any known or suspected violation. I understand that violation of this Policy may result in disciplinary action up to and including termination and may carry legal consequences.

Disclaimer: This document is a policy template prepared for CR Equity AI, Inc. It does not constitute legal advice. Bracketed items must be completed and the Policy should be reviewed and approved by qualified legal and compliance counsel, and reconciled against current federal and state law and the requirements of the Company's warehouse lenders and investors, before adoption.