It will be hard for you to defend your criteria as it is discriminatory. 

I don't like telling people what the criteria are, because I don't want to give them potential evidence to try to use against me for some bogus discrimination suit that I still would have to pay to defend against.  

The CFPB is already taking an active interest in the issue and is finding ways to fine and penalize for this on the Federal level.The solution is a robust Loan Policy and Procedure Manual that can explain and defend higher deficiency rates.

Interest is accruing on the unpaid principal balance at the rate of $22.5728 per day after January 29, 2015 until the date of entry of this judgement, plus interest on the judgement amount (principal plus the shared appreciated recapture plus interest to the date of entry of this Judgement) at the rate of .33% computed daily and compounded annually, until paid in full and for the costs of this action, pursuant to Judgement and Order of Sale, being Civil action #..... entered on August 4, 2015.Minimum acceptable bid is $35,510.00.Terms of sale:  ...This sale shall be in bar and foreclosure of all right, title, interest, estate claim, demand or equity of redemption of the defendant(s) and of all persons claiming by, through, under or against them, provided the purchase price is equal to two-thirds of the appraised value.  

That means they can be sued, be made to pay legal bills defending the suit after their coverage is exhausted.

We hired an attorney to defend against this frivolous lawsuit and $4k in legal fees later, we won (it was ruled that the contract was clear), and we countered for legal fees.

RAsset ManagementProspective Buyer shall indemnify, defend, protect and hold harmless each Owner and Agent from any claim or demand by any person or entity entitled to receive from Prospective Buyer and/or Registered Broker or for its account any brokerage commission or finder’s fee in connection with this Agreement or any possible transaction, A Private Brokerageany claim by any party (including Reviewer or any person associated with Reviewer) of any right to any brokerage commission or fee

I will vigorously defend myself or my clients though

You will of course have to defend your own actions, but this shouldn't be a problem for someone that has been licensed for an incredible 8 months.

When State AGs and regulators begin prosecuting, and they are and will, small lenders and note dealers/investors will be devastated trying to defend themselves.