April 30, 2007 NovaStar Mortgage, Inc. NovaStar Certificates Financing LLC NovaStar Certificates Financing Corporation 8140 Ward Parkway, Suite 300 Kansas City, Missouri 64114 Re: Master Repurchase Agreement Waiver Reference is made to that certain Master Repurchase Agreement (2007 Servicing Rights) dated as of April 25, 2007 (the "Servicing Rights Agreement"), among Wachovia Bank, N.A., as Buyer, Wachovia Capital Markets, LLC, as Agent, NovaStar Mortgage, Inc., as a Seller, and NovaStar Financial, Inc., NovaStar Mortgage, Inc., HomeView Lending, Inc. and NFI Holding Corporation, as Guarantors and that certain Master Repurchase Agreement (2007 Residual Securities) dated as of April 18, 2007 (the "Residual Securities Agreement" and together with the Servicing Rights Agreement, the "Agreements"), among Wachovia Investment Holdings, LLC, as Buyer, Wachovia Capital Markets, LLC, as Agent, NovaStar Mortgage, Inc., as a Seller, NovaStar Certificates Financing LLC, as a Seller, NovaStar Certificates Financing Corporation, as a Seller and NovaStar Financial, Inc., NovaStar Mortgage, Inc., HomeView Lending, Inc. and NFI Holding Corporation, as Guarantors. Capitalized terms used in this letter without definition have the meanings ascribed to them in the Agreements. Each Buyer hereby gives consent for NovaStar Financial Inc. to declare and pay dividends on its 8.90% Series C Cumulative Redeemable Preferred Stock and the Trust Preferred Securities for the quarter ended June 30, 2007. The payment of such dividends shall not constitute a breach of Section 13(u) under the Servicing Rights Agreement or Section 13(t) under the Residual Securities Agreement and each Buyer hereby waives any event of default that would otherwise arise as a result of the payment of such dividends under the Agreements. Each Seller acknowledges that after giving effect to the payment of such dividends, it will continue to be in compliance with all financial covenants set forth in the Agreements. Except as expressly set forth herein, this letter shall not, by implication or otherwise, limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of the Buyer under the Agreements, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Agreements, all of which shall continue in full force and effect. For the avoidance of doubt, any future dividends must be expressly approved by the Buyers in writing.
Very truly yours, Wachovia Bank, N.A., as Buyer By: /s/ Andrew W. Riebe -------------------------------------- Name: Andrew W. Riebe Title: Director Wachovia Investment Holdings, LLC, as Buyer By: /s/ Justin Zakocs -------------------------------------- Name: Justin Zakocs Title: Vice President 2