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  March 16, 2001

Michael E. Hendicks
Hendricks, Hendricks & Shakes
4055 Nonchalant Circle South
Colorado Springs, CO 80917

Dear Mr. Hendricks,

Since you and your firm represent Grand West Financial, and Kevin Marks, we are addressing this document to you.

Your client presently holds a deed of trust on our house. This deed of trust was granted last summer as part of the loan application process. At the time, we didn't see anything suspicious in the deed of trust. It wasn't until later that we understood the full ramifications of the deed of trust and it's purpose. Because of the purpose of the deed of trust, i.e., to insure payment to Grand West Financial regardless of circumstances, it is for all intentions a fraudulent document. The terms of the agreement are beyond reasonable and legal. One cannot demand payment when one's actions are illegal and fiscally irresponsible.

The construction loan on the house was for $15,000.00 more than requested or required. This resulted in us having to pay more in interest. Since the commission paid to Grand West Financial was based upon the loan amount, this also resulted in a greater commission than should have been paid. We feel that Grand West Financial exploited us for personal gain in this item. We are looking into a formal complaint concerning this matter.

The Permanent Loan Contract, signed July 31, 2000, is part of the Permanent Loan Agreement, signed June 14, 2000. Grand West Financial is in violation of the following:

Heading Release of Funds – Home: Grand West failed to notify the buyers of the delivery date of the home. Since the provision was part of the paperwork signed with Grand West Financial, Grand West Financial was required to inform us of the pending delivery so that we could be present when the house was delivered.

Heading Release of Funds – Other draws: Grand West failed to properly verify the work had been completed. When asked to identify the inspector and provide the papers used to verify the work, Grand West's response was they do not require any paperwork; they only perform a visual inspection to verify the work. That is inconsistent with the requirements of fiduciary responsibility. It is our guess that Grand West performed no verifications beyond verbally inquiring of the contractor, if that much.

Heading Description of the Loan Process – Paragraph 5 & 6: The Permanent Loan Agreement states that "final inspections and approvals" are to be obtained before Close on the Permanent Financing. Yet, Kevin Marks repeatedly pressured us to go to closing without a Certificate of Occupancy and a Final Inspection from Park County. Several times he stated that he did not need a CO to go to settlement and threatened us stating that by us not agreeing to settle immediately that we were in fact violating the provisions of the contract.

Heading Borrower's Duties and Responsibilities – Paragraph 12 of The Permanent Loan Contract: Grand West Financial attempted to use this provision to bully the purchasers into going to settlement before "final inspections and approvals" were completed.

During our dispute with NorthStar concerning the lack of water, Kevin became very involved in the dispute, all on the side of NorthStar. "Read the contract", was his favorite phrase. That was his response when I questioned the lack of water and a final inspection. I said that we expected a house built to code. "Read the contract". He defended NorthStar's stand on the electrical wiring. He had a copy of the contract that NorthStar had faxed him. He quoted the pertinent clause "No power of any kind is included in this contract" and refused to listen to reason. That statement refers to power being supplied to the house, not electrical wiring in and around the house. His adamant support of NorthStar is a reflection of his bias to his buddies.

Kevin Marks has repeatedly pressured us to close. In our first conversation on December 27th, he advised me to "back off" and that NorthStar was "a fine builder", the "best in Teller County". That he had done 100's of home loans and "you're doing fine". When I pointed out the conflict in the numbers, he replied that "there's nothing to go thru", that we "merely approved numbers". "Pay it, it's not worth fighting over". "Get into your house and you'll feel different about everything".

In our second conversation on December 27th, he again pressured us to go to closing. He indicated that we had an incredible interest rate of 7.875% but it was only good for another week or so. It was "to our benefit to get this done now". He said he could draw up the documents now. He stated more than once that he had no certificate of occupancy requirement for closing.

On December 29th, Karen spoke with Kevin Marks concerning some settlement issues. She asked if she could set some money aside in escrow to insure that NorthStar would complete contractual items. She was asked by Kevin if these items were in writing; yes they were. Kevin said there was no reason to escrow money, to go ahead and pay them since NorthStar would honor these contractual items.

And to further demonstrate the connection between Grand West and NorthStar, at the scheduled closing on December 29th, we received a copy of the agreement with NorthStar from Grand West. Why didn't NorthStar provide this copy? Or is this another example of Kevin Marks protecting NorthStar?

As per the Permanent Loan Agreement, we requested a copy of the Loan Appraisal. On January 11, 2001, we stopped by the offices of Grand West Financial to pick up that copy. Kevin Marks had us sign for the document. Unknown to us, the appraisal was missing two pages, the first two pages; the pages that stated the appraised value of the house. This omission renders the document useless. We feel this was a deliberate omission on his part and another failure to perform according to contract. We are sure that this is a violation of some requirement and we will be filing a complaint with the regulatory agency involved.

We were also told by Kevin Marks that the reason we were not getting cooperation from Grand West Financial and NorthStar was because of our attitude. When I pointed out to him that I didn't know "attitude" was part of the contract, he immediately responded, "It is now!". His actions and conversations are an indicator that he wasn't concerned about us, or the property, but getting the loan closed as soon as possible regardless of the outstanding problems. Since the contract that he signed was with us and not with NorthStar, it seems to us he didn't fully comprehend who is client was.

Because of the refusal of NorthStar to provide us with documentation of charges and the unswerving support afforded them by Grand West Financial, we decide it was in our best interests to obtain outside financing to pay off the construction loan. We wanted proof before we paid NorthStar. Kevin's insistence that we pay regardless of our reservations, convinced us that we needed to seek alternative funding.

Kevin Marks flagrantly violated the contract and his fiscal responsibilities. We feel his unabashed support for NorthStar is an indication of a deeper and more sinister relationship than meets the eye. He has repeatedly violated the agreements we signed with him and therefore has not earned any commission for the final loan on the house.

If Kevin Marks and Grand West Financial do not immediately release the deed of trust and acknowledge that we do not owe them any further monies, we will pursue this in court.

Sincerely yours,

  Michael Meadors
Karen Dudnikov
P.O. Box 87
Hartsel, CO 80449
Phone: 719-539-8032
cc: Grand west Financial, Ltd

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