Via Fax No: 719-630-1267

August 21, 2001
Re: Rui Haagen Loan no. 275001-000

Dear Mr. Johnson:

Sheriff's Deputies are attempting to regain possession of this companies (sic) home that your client knowingly broke into but to ensure their removal I have attached a Demand for Compliance of Possession. If you (sic) client is not out of this home by close of business on Friday, August 24, 2001, an eviction process will be filed. This company is also hereby invoking its Power of Sale and will move to sell this property immediately.

Your client can cure this default by paying their (sic) loan off in full in the amount of $124,635.56 by close of business on Friday, August 24, 2001.

You have continued to fail to provide this company with any proof that your client has been approved for a mortgage to pay this debt off. Additionally, the only evidence I have is that your client changed her credit during the course of construction, lowering her FICO scores, she also took on additional debt and made late payments on existing debt which I understand caused her to lose her initial permanent loan. The lender you claim has a permanent mortgage informed me she does not have permanent loan in place, she has informed me that per Ms Haagan's instructions she is not moving forward with a loan until the liens by the contractor are released.

Your client has been in default on this loan since April 1, 2001. She claimed in June of 2001 that you represented her and on June 12, 2001, I left a message for you wanting verification of such representation. You did not bother to notify me of your representation until my attorney presented me a copy of a letter you sent to me at the wrong address on July 30, 2001. I immediately contacted you and notified you of your clients default and her lack of response to cure this defect. In our July 31, 2001, conversation I also informed you of my notification that your client broke into this home that weekend after never living in the home prior to this or ever being given possession of the keys to said home and took possession without any authorization from this company. You informed me you instructed her to move into said home even though you knew they were in default. Your client claims they do not owe the liens against said property yet she signed her budget knowing full well Northstar was taking a subordination of $19,827 which was to be paid at closing on the permanent loan. How she suddenly does not owe this is questionable. You then informed me that my company would be paid only if I made Northstar and Grand West release their liens. As I have informed you on several occasions I cannot make any other company give up their rights, your client could simply bond around said liens and pay this company off to cure said defect but during our conversations you refused as you believe that by threatening no payment to me I can force other companies to give up their rights. Your client has no loan, no cash reserve to pay this debt off and she did in fact authorize all payments and the subordination to the contractor.

If your clients wishes to settle this matter outside of additional court cost and fees she may provide this company transfer of her Warranty Deed for the vacant land. By doing so we will agree that if the property is sold for more than is owed to clear all liens, court costs and attorney fees against the property she will receive any difference as refund of some of her down payment. She could end up with some cash back if she agrees to this offer. If we continue through legal channels she may not end up with any money as the legal fees and court costs could run more than the property can be sold for and then she will end up with additional debt also. This offer is good until they are to be out of the home by close of business on Friday, August 24, 2001.

It is in your client's best interest to immediately show good faith and resolve this matter.

Sincerely,

signature

Moncia A. Wasden
President