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December 27, 1982, EA 83-XII closed the purchase of each
of the five model houses from Raldon.
To finance its purchase of the subject houses, EA 83-
XII borrowed approximately 95 percent of the purchase
price of each of the properties from EPIC Mortgage, Inc.
(EMI), a corporation affiliated with EPIC. EMI's business
was to originate mortgages for EPIC partnerships. At
closing, EA 83-XII executed five nonrecourse promissory
notes, in the aggregate principal amount of $461,675,
payable to EMI in monthly installments of interest only on
the unpaid principal balance for 5 years at the rate of
14.375 percent. The entire indebtedness under each note
was due 5 years after the date of the first payment of
interest required under the note.
Each nonrecourse promissory note was secured by a
deed of trust bearing the date of closing and recorded
on January 3, 1983, in the land records of Denton County,
Texas. A mortgage insurance company, Ticor Mortgage
Insurance (TMI), issued a commitment and certificate of
insurance dated December 28, 1982, providing mortgage
insurance for 25 percent of the first loss amount with
respect to the mortgage on each of the five properties.
Set out below is a list of each of the properties
that EX 83-XII purchased from Raldon, the purchase price
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