Exhibit
99.2
BRAVO 2026-NQM7
Overview
Maxwell Diligence Solutions, LLC (“MaxDiligence”),
a third-party diligence provider, performed certain due diligence services (the “Review”) described below on residential mortgage
loans acquired by Loan Funding Structure IX LLC (the “Client”).
The Review was conducted from December 2025 to January 2026 on mortgage
loans (the “Loans”) originated in December 2025.
The Review consisted of 100% of the population of 3 loans with an
original loan balance of $2,464,000.00.
Scope of Review
Credit Review
MaxDiligence performed a “Credit Review”
to verify compliance with guidelines in effect at the time of loan origination, or other guidelines provided by Client prior to review,
and ensure the characteristics used by the underwriter are supported by the file documentation; and determine whether any Loans outside
of those guidelines contain legitimate and approved exceptions with compensating factors.
The credit review included the following (collectively, the
“Credit Review”):
| 1. | Review Initial & Final Application |
| a. | Check application for completeness. Determine whether the information in the preliminary Loan application,
final application, and all credit documents is consistent or reconciled. |
| b. | Validate Social Security/Taxpayer Identification number is valid |
| c. | Compare data on final form 1003 with the data from verifications |
| d. | Form is complete, signed, dated, on or before loan consummation date, and NMLS is complete |
| 2. | Review AUS Decision and Approval Conditions |
| a. | Underwriting decision is supported (manual underwrite credit conditions have been satisfied prior to
closing the approved Loan package) |
| b. | Validation of income calculations |
| c. | Validation of assets/funds to close |
| d. | Validation of debt-to-income ratio (“DTI”) calculations |
| e. | Validation of debt service coverage ratio (“DSCR”) calculations |
| f. | Validation of LTV calculations |
| g. | Validation of payment shock calculations if applicable |
| i. | Review of hazard coverage and verification that sufficient coverage was in place on subject and all
premiums were included in DSCR calculation |
| ii. | Review of rental income and/or market rents and validation of DSCR calculation |
| 3. | Review Occupancy/Red Flags |
| a. | Validates Social Security number and year issued |
| b. | Verifies address information associated with the borrower (s) |
| d. | Occupancy Red flags adequately addressed |
| 4. | Reverification of Borrower Original and Audit Credit Report |
| a. | Validate names, social security number(s), and addresses |
| b. | “Doing business as” or “also known as” names investigated and cleared |
| c. | Validate credit inquiries within 90 days have been properly addressed |
| d. | Acceptable credit history and credit score requirements in conformance with applicable guidelines |
| 5. | Reviews Fraud Report to compare vs loan documentation: |
| a. | Validates Social Security number and year issued |
| b. | Verifies address information associated with the Borrower (s) |
| c. | Confirms OFAC clearances |
| d. | Reveals any potential bankruptcy filings |
| 6. | Review of Borrower Employment, Income, and Asset Information |
| i. | Compare for conflicting information |
| ii. | Check dates for document expiration |
| iii. | Complete forms and documentation |
| iv. | Evaluate history and stability of employment |
| i. | Review employment and income by analyzing income documents and comparing
against re-verification documents |
| ii. | W-2s and paystubs, if applicable |
| iii. | Transcripts (as applicable) support income |
| iv. | Tax returns and profit and loss statements, as applicable |
| v. | Bank statements or other alternate income documents as required by the guidelines |
| vi. | Consistent/continuing employment, if applicable |
| vii. | Lease agreements and market rents, if applicable |
| i. | Confirm adequate funds to cover required down payment and closing costs
and reserves |
| ii. | Check dates for document expiration |
| iii. | Sufficient funds were sourced and seasoned |
| iv. | Gift funds verified and met guidelines |
| b. | Earnest money deposit verified |
| d. | Seller contributions are within guidelines |
| 8. | Hazard and Flood (if applicable) |
| a. | Verify sufficient coverage |
| b. | Verify coverage is for subject |
| c. | Validate all premiums are included in housing payment and any required upfront premium is paid |
| 9. | Review Title Commitment/Policy |
| d. | Validate no encumbrances |
| 10. | Review Closing Documents |
| a. | Review security documents to ensure the Loan was closed in accordance with approval and with all required
signatures |
| b. | Correct and complete instruments |
| c. | Closing disclosure or Settlement Statements |
Property Review
MaxDiligence performed a “Property Review,”
which included the following:
| a. | MaxDiligence’s review included a review of the valuation materials utilized during the origination
of the applicable Loan and in confirming the value of the underlying property. MaxDiligence’s review will include verifying the
appraisal report: |
| b. | On the appropriate appraisal form: |
| i. | All elements of appraisal are present |
| ii. | Ensure all applicable Loan documents match appraisal information |
| iii. | Property is acceptable collateral for Loan program |
| iv. | Completed by an appraiser that was actively licensed to perform the valuation |
| v. | Completed such that the named client on the appraisal report is the lender or a related entity that
is permitted to engage the lender per Title XI of FIRREA, or if the appraisal was performed for another lender, the file contains a transfer
letter from the original lender |
| vi. | The original appraisal report is made and signed prior to the final approval of the mortgage loan application;
Any revisions, if made known to MaxDiligence, |
to the original report are documented and dated completed and dated
within the guideline’s restrictions,
| vii. | The original appraisal is ‘As is' or Inspection received including all inspections, licenses,
and certificates (including certificates of occupancy) to be made or issued with respect to all occupied portions of the mortgaged property
and with respect to the use and occupancy of the same, have been made or obtained from the appropriate authorities. |
| viii. | Determine whether the appraised value is supported at or within 10% variance based on a third-party
valuation product. If a third-party valuation product is in file but notes a variance above 10% or an inconclusive value, MaxDiligence
recommended a BPO or field review be ordered. |
| ix. | With regard to the use of comparable properties, MaxDiligence’s review will (a) reviewed the relative
comparable data (gross and net adjustments, sale dates and distance from subject property) and ensure that such comparable properties
are within standard appraisal guidelines; (b) confirmed the property value and square footage of the subject property was bracketed by
comparable properties, (c) verified that comparable properties used are similar in size, style, and location to the subject, and (d) checked
for the reasonableness of adjustments when reconciling value between the subject property and comparable properties. |
| x. | Other aspects of MaxDiligence’s review included (i) verifying that the address matched the mortgage
note, ((ii) if requested, noting whether the property zip code was declared a FEMA disaster area after the valuation date and notifying
the Client of same, (iii) confirming the appraisal report does not include any apparent environmental problems, (iv) confirming the appraisal
notes the current use of the property is legal or legal non-conforming (grandfathered), (v) reviewing pictures to ensure (a) that the
property is in average or better condition and any repairs are noted where required and (b) that the subject property is the one for which
the valuation was ordered and that there are no negative external factors; and (vi) confirming that the value product that was used as
part of the origination decision conforms with rating agency requirements. |
| c. | If more than one valuation was provided, MaxDiligence will confirm consistency among the valuation products
and if there are discrepancies that could not be resolved, MaxDiligence created an exception, and work with the client on the next steps
which may include ordering of additional valuation products such as collateral desktop reviews, broker’s price opinions, and full
appraisals, if needed. If the property valuation products included in MaxDiligence’s review result in a variance of more than 10%
then the client was notified of such variance. |
| d. | MaxDiligence confirmed to the extent possible, that the appraiser and the appraisal made by such appraiser
both satisfied the requirements of Title XI of FIRREA. Specifically, MaxDiligence will review the appraisal for conformity to industry
standards, including ensuring the appraisal was complete, that the comparable properties and adjustments were reasonable and that pictures
were provided and were accurate. |
| e. | In addition, MaxDiligence accessed the ASC database to verify that the appraiser, and if applicable
the appraiser’s supervisor, were licensed and in good standing at the time the appraisal was completed. |
OVERALL RESULTS SUMMARY
The Guidelines listed below were used as a benchmark with respect to credit
and property reviews for grading purposes. The loans were assigned an initial grade after the initial review. The final grade was determined
after additional documentations were provided to satisfy outstanding conditions. When Guideline exceptions were provided, reviewers reviewed
to ensure compensating factors were also provided and documented.
After giving consideration to the grading criteria
of the relevant NRSROs, 100% of the loans received a an Overall “A” grade.
Final Loan Grades
| Rating Agency Final Overall Grade Summary |
| |
| Overall |
# of Mortgage Loans |
% of Mortgage Loans |
| A |
3 |
100.0% |
| B |
0 |
0.0% |
| C |
0 |
0.0% |
| D |
0 |
0.0% |
| Total |
3 |
100.0% |
| |
| Final Credit Grade Summary |
| Credit |
# of Mortgage Loans |
% of Mortgage Loans |
| A |
3 |
100.0% |
| B |
0 |
0.0% |
| C |
0 |
0.0% |
| D |
0 |
0.0% |
| Total |
3 |
100.0% |
| |
| Final Property Grade Summary |
| Property |
# of Mortgage Loans |
% of Mortgage Loans |
| A |
3 |
100.0% |
| B |
0 |
0.0% |
| C |
0 |
0.0% |
| D |
0 |
0.0% |
| Total |
3 |
100.0% |
| Final Compliance Grade Summary |
| Compliance |
# of Mortgage Loans |
% of Mortgage Loans |
| A |
3 |
100.0% |
| B |
0 |
0.0% |
| C |
0 |
0.0% |
| D |
0 |
0.0% |
| Total |
3 |
100.0% |
Exception Category Summary
The table below summarizes the individual exceptions which carried an associated
“A”, “B”, “C”, or “D” level exception grade. One loan may have carried more than one exception.
In such cases, the exception with the lowest grade would drive the loan grade for that particular area of the review. The overall loan
grade is the lowest grade for any one particular review scope (i.e., a loan with a Credit Grade of “A”, a Compliance Grade
of “B”, and a Valuation Grade of “A” would receive an overall Loan Grade of “B”).
| Exception Type |
Exception Level Grade |
Exception Category |
Count |
| Compliance |
A |
Federal - Right of Rescission (Loan Disbursement Violation) (TILA) |
1 |
| No Compliance Findings |
1 |
| No Compliance Tests Performed |
1 |
| |
|
Total Compliance Grade (A) Exceptions |
3 |
| Credit |
A |
Flood Insurance Policy Missing |
1 |
| No Credit Findings |
1 |
| Property Title Issue |
1 |
| |
|
Total Credit Grade (A) Exceptions |
3 |
| Property |
A |
Value - Field Review Supports Value within 10% |
1 |
| Value - Value is supported within -10% of original appraisal amount |
2 |
| |
|
Total Property Grade (A) Exceptions |
3 |
TAPE INTEGRITY REVIEW RESULTS SUMMARY
As part of the Credit and Property Reviews, MaxDiligence captured data from
the source documents and compared it to a data tape provided by Client. MaxDiligence provided Client a Data Discrepancy Report which shows
the differences between the tape data and the data captured by MaxDiligence during the diligence process.
Of the 3 Loans reviewed, 2 unique Loans (by loan count)
had a total of 3 different tape discrepancies across the data fields (some Loans may have had more than one). A blank or zero value on
the data tape when an actual value was captured by MaxDiligence was not treated as a data variance.
Event Grade Definitions
| Final
Loan Grade |
| A |
Loan
meets Credit, Compliance, and Valuation Guidelines |
| B |
The
loan substantially meets published Client/Seller
guidelines and/or eligibility in the validation of income, assets, or credit, is in material
compliance
with all
applicable laws
and regulations,
and the value and valuation methodology is supported and substantially meets published guidelines. |
| C |
The
loan does not meet the
published guidelines and/or violates one material law or regulation, and/or the value
and valuation methodology is not supported or did not meet published guidelines. |
| D |
Loan
is missing documentation to perform a sufficient review. |
| Credit
Event Grades |
| A |
The
loan meets the
published guidelines without any exceptions. The employment,
income, assets and occupancy are supported
and justifiable. The borrower’s
willingness and ability to repay the loan is documented and reasonable. |
| B |
The
loan substantially meets the
published guidelines but reasonable compensating
factors were considered and documented
for exceeding published guidelines. The employment,
income, assets and occupancy are supported and justifiable. The borrower’s
willingness and ability to repay the loan
is documented and reasonable. |
| C |
The
loan does not substantially meet the
published guidelines. There
are not sufficient compensating factors that
justify exceeding the published guidelines. The
employment, income,
assets or occupancy are not supported and justifiable. The borrower’s
willingness and ability to repay the loan
were not documented or are unreasonable. |
| D |
There
was not sufficient documentation to perform a review or the
credit file was not furnished. |
| Compliance
Event Grades |
| A |
The
loan is in compliance
with all applicable
laws and regulations.
The legal documents
accurately
reflect
the agreed upon
loan terms
and are executed
by all applicable
parties. |
| B |
The
loan is in material
compliance
with all
applicable laws
and regulations.
The
legal documents
accurately
reflect
the agreed
upon loan
terms and
are executed
by all applicable
parties. Client review required. |
| C |
The
loan violates one
material law
or regulation. The
material disclosures
are absent or
the legal documents
do not accurately
reflect the agreed
upon loan terms
or all required
applicants did not
execute the documents. |
| D |
There
was not
sufficient
documentation
to perform
a review
or the required
legal documents
were not
furnished. |
| Valuation
Event Grades |
| A |
The
value is supported within 10% of the original appraisal by the AVM or there are other supporting documents in the originators loan
file package (CDA, Field Review or Second Appraisal). The appraisal was performed on an "as-is" basis and the property
is complete and habitable at origination. The appraiser was appropriately licensed and used GSE approved forms. |
| B |
The
value is not supported within 10% of the original appraisal by the AVM and there are no other valuation support documents in the
loan file provided by the Seller. The valuation methodology substantially meets the published guidelines, but reasonable
compensating factors were considered and documented for exceeding guidelines. The appraisal was performed on an "as-is"
basis and the property is complete and habitable. The appraiser was appropriately licensed and used GSE approved forms. |
| C |
The
value is not supported within 10% of the original appraisal. The valuation methodology did not meet the published
guidelines and there were not sufficient compensating factors for exceeding published guidelines. The property is
in below “average” condition or the property is not complete or requires significant repairs. The appraisal
was not performed on an “as is” basis. The appraiser was not appropriately licensed or did not use GSE
approved forms. |
| D |
The
file was missing the appraisal or there was not sufficient valuation documentation to perform a review. |