EXHIBIT 10.4









                           Dated 28 January 2004
                           ---------------------


                      GRANITE FINANCE FUNDING LIMITED
                                 as Funding



                             NORTHERN ROCK PLC
                  as Current Issuer Start-Up Loan Provider



                                  - and -



                            THE BANK OF NEW YORK
                            as Security Trustee





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                      ISSUER 04-1 START-UP LOAN AGREEMENT

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                          SIDLEY AUSTIN BROWN & WOOD
                             1 THREADNEEDLE STREET
                                LONDON EC2R 8AW
                            TELEPHONE 020 7360 3600
                            FACSIMILE 020 7626 7937


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                                  CONTENTS

1.    Definitions and Interpretation......................................1

2.    The Advance.........................................................1

3.    Interest............................................................2

4.    Repayment...........................................................2

5.    Acceleration........................................................3

6.    Payments and limited recourse.......................................3

7.    Subordination and Security..........................................3

8.    Notices.............................................................5

9.    Taxes...............................................................5

10.   Remedies and Waivers................................................6

11.   Assignments and Transfer............................................6

12.   Alternative Payment Arrangements....................................6

13.   Security Trustee as a Party.........................................6

14.   No Partnership......................................................7

15.   Variation...........................................................7

16.   Execution in Counterparts; Severability.............................7

17.   Third Party Rights..................................................7

18.   Governing Law and Jurisdiction; Process Agents; Appropriate Forum...7

SCHEDULE 1  REPRESENTATIONS AND WARRANTIES                                8


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THIS ISSUER 04-1 START-UP LOAN AGREEMENT is made on 28 January 2004

BETWEEN:

(1)   GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
      limited company incorporated under the laws of Jersey but acting out of
      its branch office established in England (registered overseas company
      number FC022999 and branch number BR005916) at 4 Royal Mint Court,
      London EC3N 4HJ as Funding;

(2)   NORTHERN ROCK PLC (registered number 3273685), a public limited company
      incorporated under the laws of England and Wales whose registered office
      is at Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL in its
      capacity as Current Issuer Start-Up Loan Provider; and

(3)   THE BANK OF NEW YORK, whose principal office is at 48th Floor, One
      Canada Square, London E14 5AL in its capacity as Security Trustee.

IT IS HEREBY AGREED as follows:

1.    Definitions and Interpretation

1.1   The provisions of:

      (a)   the Master Definitions Schedule as amended and restated by (and
            appearing in Appendix 1 to) the Master Definitions Schedule
            Seventh Amendment and Restatement Deed made on 26 January 2004
            between, among others, the Seller, Funding and the Mortgages
            Trustee, and

      (b)   the Issuer Master Definitions Schedule signed for the purposes of
            identification by Sidley Austin Brown & Wood and Allen & Overy on
            28 January 2004,

      (as the same have been and may be amended, varied or supplemented from
      time to time with the consent of the parties hereto) are expressly and
      specifically incorporated into and shall apply to this Agreement. The
      Issuer Master Definitions Schedule specified above shall prevail to the
      extent that it conflicts with the Master Definitions Schedule.

2.    The Advance

      The Current Issuer Start-Up Loan Provider grants to Funding
      simultaneously with the issue by the Current Issuer of the Current
      Issuer Notes (and upon the simultaneous issuance by the Current Issuer
      to Funding of the Current Issuer Intercompany Loan) and upon the terms
      and subject to the conditions hereof, a loan in an aggregate amount of
      (GBP)46,650,000 (Forty Six Million Six Hundred and Fifty Thousand)
      (the "Advance") on the Closing Date for the purposes of providing for
      the partial funding of the Issuer Reserve Fund and providing for
      Funding's costs and expenses in respect of the increase of the Funding
      Share of the Trust Property and in respect of amounts payable to the
      Current Issuer by Funding as fees under the Current Issuer Intercompany
      Loan. The Advance shall be paid into the Funding Transaction Account.


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3.    Interest

3.1   The Advance and any interest capitalised pursuant to Clause 3.4 will
      bear interest in accordance with Clause 3.3 at a rate of LIBOR for
      three-month sterling deposits plus 0.90 % per annum from (and including)
      the Closing Date until the Advance and all accrued interest thereon is
      repaid in full. Prior to the service of an Intercompany Loan Enforcement
      Notice, Funding shall pay interest on the Advance on each Payment Date
      if, and only to the extent that, there are Funding Available Revenue
      Receipts available therefor after making the payments and provisions
      referred to in the Funding Pre-Enforcement Revenue Priority of Payments.

3.2   Subject to Clauses 6.2 and 6.3, interest on the Advance and any interest
      capitalised pursuant to Clause 3.4 will be payable by Funding in arrear
      on each Payment Date in accordance with the Funding Priority of
      Payments.

3.3   Interest shall be calculated by reference to any Interest Period on the
      basis of the actual number of days elapsed and a 365 day year (or, in
      the case of a leap year, a 366 day year).

3.4   Any interest accrued in respect of an Interest Period but not paid on
      the Payment Date relating thereto shall be capitalised forthwith.

4.    Repayment

4.1   Prior to the service of an Intercompany Loan Enforcement Notice, Funding
      shall repay principal of the Advance (including any interest capitalised
      pursuant to Clause 3.4) on each Payment Date if, and only to the extent
      that, there are Funding Available Revenue Receipts available therefor
      after making the payments and provisions referred to in the Funding
      Pre-Enforcement Revenue Priority of Payments.

4.2   The Cash Manager is responsible, pursuant to the Cash Management
      Agreement, for determining the amount of Funding Available Revenue
      Receipts as at any Payment Date and each determination so made shall (in
      the absence of negligence, wilful default, bad faith or manifest error)
      be final and binding on the Current Issuer Start-Up Loan Provider.

4.3   Subject to Clauses 5, 6.2, 6.3 and 7, on any Payment Date on which all
      the Intercompany Loans have been repaid in full, Funding shall
      immediately repay the Advance (including any interest capitalised
      pursuant to Clause 3.4) and pay any accrued interest.

4.4   The Current Issuer Start-Up Loan Provider hereby acknowledges that
      Funding has entered into Previous Start-Up Loan Agreements with Previous
      Start-Up Loan Providers and that from time to time Funding may enter
      into New Start-Up Loan Agreements with New Start-Up Loan Providers and
      that the obligation of Funding to repay the Current Issuer Start-Up
      Loan, any other existing Start-Up Loans and any New Start-Up Loan will
      rank pari passu and will be paid pro rata between themselves. The
      Current Issuer Start-Up Loan Provider further acknowledges that the
      Funding Pre-Enforcement Revenue Priority of Payments and the Funding
      Post-Enforcement Priority of Payments set out in the Funding Deed of
      Charge, respectively, will be amended to reflect the entry by Funding
      into New Start-Up Loan


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      Agreements and related agreements from time to time and agrees to
      execute such documents as are necessary or required by the Rating
      Agencies for the purpose of including the New Start-Up Loan Provider
      (and any other relevant party) in the Transaction Documents to effect
      those amendments.

5.    Acceleration

      If an Intercompany Loan Enforcement Notice is served, the Advance
      (including any interest capitalised pursuant to Clause 3.4) and accrued
      interest shall, subject to the Funding Deed of Charge, become
      immediately due and payable.


6.    Payments and limited recourse

6.1   All payments to be made hereunder by Funding shall be made in sterling
      in immediately available cleared funds to the Current Issuer Start-Up
      Loan Provider's account as specified in writing to Funding for this
      purpose. If any sum falls due hereunder otherwise than on a London
      Business Day, it shall be paid on the next succeeding London Business
      Day.

6.2   Prior to service of an Intercompany Loan Enforcement Notice or repayment
      in full of all the Intercompany Loans, amounts of interest, principal
      and any other amounts due hereunder shall be paid only in accordance
      with Clauses 3.1, 4.1 and 7.1, respectively, and the provisions of the
      Funding Deed of Charge.

6.3   If, upon the Advance becoming due and payable pursuant to Clauses 4.3 or
      5, Funding has insufficient funds available to meet its obligations
      hereunder in full on such date then:

      (a)   Funding shall utilise its funds on such date to the extent
            available in making payments to the Current Issuer Start-Up Loan
            Provider to repay the Advance (including any interest capitalised
            pursuant to Clause 3.4) and accrued interest thereon; and

      (b)   the obligations of Funding to pay the shortfall together with any
            amounts falling due and payable thereafter shall on any day be
            limited to the available funds actually received by Funding from
            time to time subsequent to such date, together with the proceeds
            of the enforcement of the security, paid to the Current Issuer
            Start-Up Loan Provider pursuant to Clause 8 (Upon Enforcement) of
            the Funding Deed of Charge,

      provided that the Current Issuer Start-Up Loan Provider shall not
      release Funding from Funding's obligation to pay the remaining amount
      that would have been due under this Agreement had this Clause 6.3 not
      applied.

7.    Subordination and Security

7.1   The parties hereby agree that repayments in respect of the Advance shall
      be subordinated to, inter alia, payments of principal and interest on
      the Current Issuer Intercompany Loan and all other payments or
      provisions ranking in priority to payments to be made to the Current
      Issuer Start-Up Loan Provider under this


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      Agreement in accordance with the Funding Priority of Payments and the
      Funding Deed of Charge.

7.2   The Current Issuer Start-Up Loan Provider further agrees that, without
      prejudice to Clause 8 (Upon Enforcement) of the Funding Deed of Charge,
      its rights against Funding under this Agreement are limited to the
      extent that Funding has sufficient assets to meet the Current Issuer
      Start-Up Loan Provider's claim or any part thereof having taken into
      account all other liabilities, both actual and contingent, of Funding
      which pursuant to the Funding Deed of Charge rank pari passu with or in
      priority to its liabilities to the Current Issuer Start-Up Loan Provider
      under this Agreement and so that Funding shall not be obliged to make
      any payment to the Current Issuer Start-Up Loan Provider hereunder if
      and to the extent that the making of such payment would cause Funding to
      be or become unable to pay its debts within the meaning of Section 123
      of the Insolvency Act 1986. However, if there are Funding Available
      Revenue Receipts available but Funding does not repay the Advance
      (including any interest capitalised pursuant to Clause 3.4) and/or
      interest thereon when due (to the extent of such available Funding
      Available Revenue Receipts), such non-repayment will constitute an event
      of default under this Current Issuer Start-Up Loan Agreement.

7.3   Funding undertakes that its obligations to the Current Issuer Start-Up
      Loan Provider hereunder shall at all times be secured by the Funding
      Deed of Charge.

7.4   The Current Issuer Start-Up Loan Provider hereby undertakes to be bound
      by the terms of the Funding Deed of Charge and the Cash Management
      Agreement and in particular agrees that on enforcement of the security
      created by the Funding Deed of Charge, all amounts of principal,
      interest and any other amounts due hereunder shall rank in the order of
      priority set out in the Funding Post-Enforcement Priority of Payments.

7.5   The Current Issuer Start-Up Loan Provider further covenants that, except
      as permitted under the Funding Deed of Charge, it will not set off or
      claim to set off the Advance or any interest thereon or any part thereof
      against any liability owed by it to Funding.

7.6   The Current Issuer Start-Up Loan Provider undertakes that it will not,
      for so long as any sum is outstanding under any Intercompany Loan
      Agreement of any Issuer or for two years plus one day since the last day
      on which any such sum was outstanding take any corporate action or other
      steps or legal proceedings for the winding up, dissolution or
      reorganisation or for the appointment of a receiver, administrator,
      administrative receiver, trustee, liquidator, sequestrator or similar
      officer of Funding or of any or all of the revenues and assets of
      Funding nor participate in any ex parte proceedings nor seek to enforce
      any judgment against Funding, except as permitted under the provisions
      of the Funding Deed of Charge.

7.7   The Current Issuer Start-Up Loan Provider acknowledges hereby that it is
      not entitled, other than by virtue of Section 208 of the Income and
      Corporation Taxes Act 1988 ("ICTA"), to any exemption from Tax in
      respect of any interest payable to it under this Agreement.

7.8   The Current Issuer Start-Up Loan Provider further represents that,
      pursuant to Section 212 of ICTA, any interest payable to it under this
      Agreement is paid to it within the charge to UK corporation tax.


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7.9   The Current Issuer Start-Up Loan Provider further represents that it is
      an institution which is a bank for the purposes of Section 840A of ICTA.

7.10  Each party to this Agreement other than the Security Trustee hereby
      makes the representations and warranties to each of the other parties to
      this Agreement that are specified in Schedule 1 hereto.

8.    Notices

      Any notices to be given pursuant to this Agreement or to any of the
      parties hereto shall be sufficiently served if sent by prepaid first
      class post or by facsimile transmission and shall be deemed to be given
      (in the case of facsimile transmission) when despatched, (where
      delivered by hand) on the day of delivery if delivered before 17.00
      hours on a Business Day or on the next Business Day if delivered
      thereafter or (in the case of first class post) when it would be
      received in the ordinary course of the post and shall be sent:

      (a)   in the case of Funding, to Granite Finance Funding Limited, 4
            Royal Mint Court, London EC3N 4HJ (facsimile number 020 7073 7874)
            for the attention of the Company Secretary with a copy to Northern
            Rock plc, Northern Rock House, Gosforth, Newcastle upon Tyne NE3
            4PL Facsimile: 0191 213 2203 for the attention of the Group
            Secretary;

      (b)   in the case of the Current Issuer Start-Up Loan Provider, to
            Northern Rock plc, Northern Rock House, Gosforth, Newcastle upon
            Tyne NE3 4PL Facsimile: 0191 213 2203 for the attention of the
            Group Secretary; and

      (c)   in the case of the Security Trustee, to The Bank of New York
            (London Branch), 48th Floor, One Canada Square, London E14 5AL
            (facsimile 020 7964 6399) for the attention of Corporate Trust
            Administration,

      or to such other address or facsimile number as may from time to time be
      notified by any party to the other by written notice in accordance with
      the provisions of this Clause 8.

9.    Taxes

9.1   All payments to be made by Funding to the Current Issuer Start-Up Loan
      Provider hereunder shall be made free and clear of and without deduction
      for or on account of Tax unless Funding is required by law to make such
      a payment subject to the deduction or withholding of Tax, in which case
      Funding shall promptly upon becoming aware thereof notify the Current
      Issuer Start-Up Loan Provider of such obligation, and shall make such
      payments subject to such deduction or withholding of Tax which it is
      required to make.

9.2   If Funding makes any payment hereunder in respect of which it is
      required to make any deduction or withholding, it shall pay the full
      amount required to be deducted or withheld to the relevant taxation or
      other authority within the time allowed for such payment under
      applicable law and shall deliver to the Current Issuer Start-Up Loan
      Provider, within thirty days after such payment falls due to the
      applicable authority,


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      any original receipt (or a certified copy thereof) issued by such
      authority evidencing such payment.

10.   Remedies and Waivers

      No failure by the Current Issuer Start-Up Loan Provider to exercise, nor
      any delay by the Current Issuer Start-Up Loan Provider in exercising,
      any right or remedy hereunder shall operate as a waiver thereof, nor
      shall any single or partial exercise of any right or remedy prevent any
      further or other exercise thereof or the exercise of any other right or
      remedy. The rights and remedies herein provided are cumulative and not
      exclusive of any rights or remedies provided by law.

11.   Assignments and Transfer

11.1  Funding (other than in respect of any assignment by way of security
      pursuant to the Funding Deed of Charge) may not assign and/or transfer
      any of its rights and/or obligations under this Agreement. The Current
      Issuer Start-Up Loan Provider may not assign and/or transfer its rights
      under this Agreement without obtaining the prior written consent of
      Funding, provided that such consent may only be given if such assignment
      and/or transfer is by way of security, or, if such assignment and/or
      transfer is to a person within the charge to United Kingdom corporation
      tax as regards any interest received by it under this Agreement. Any
      such assignee or transferee must agree to be bound by the provisions
      contained in the Funding Deed of Charge as if it were named as an
      original party thereto in place of the Current Issuer Start-Up Loan
      Provider.

11.2  If there is any change in the identity of the Security Trustee pursuant
      to the terms of the Funding Deed of Charge, the Current Issuer Start-Up
      Loan Provider and Funding shall execute such documents and take such
      actions as the new security trustee and the outgoing security trustee
      (as the case may be) may reasonably require for the purpose of vesting
      in the new security trustee the rights and obligations of the outgoing
      security trustee and releasing the outgoing security trustee (as the
      case may be) from its future obligations under this Agreement.

12.   Alternative Payment Arrangements

      If at any time it shall become impracticable for Funding to make any
      payments hereunder in the manner specified in Clause 6.1, then Funding
      may agree with the Current Issuer Start-Up Loan Provider and the
      Security Trustee alternative arrangements for such payments to be made.

13.   Security Trustee as a Party

      The Security Trustee has agreed to become a party to this Agreement for
      the better preservation and enforcement of its rights under this
      Agreement and the Security Trustee shall assume no obligations or
      liabilities whatsoever to the Current Issuer Start-Up Loan Provider or
      to Funding. Furthermore, any liberty or power which may be exercised or
      any determination which may be made hereunder by the Security Trustee
      may be exercised or made in the Security Trustee's absolute discretion
      without any obligation to give reasons therefor, but in any event must
      be exercised or made in accordance with the provisions of the Funding
      Deed of Charge.


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14.   No Partnership

      Nothing in this Agreement (or in any of the arrangements contemplated
      hereby) shall, or shall be deemed to, constitute a partnership amongst
      the parties hereto.

15.   Variation

      No variation of this Agreement shall be effective unless it is in
      writing and signed by or on behalf of each of the parties hereto.

16.   Execution in Counterparts; Severability

16.1  This Agreement may be executed in any number of counterparts (manually
      or by facsimile) and by different parties hereto in separate
      counterparts, each of which when so executed shall be deemed to be an
      original and all of which when taken together shall constitute one and
      the same instrument.

16.2  Where any provision in or obligation under this Agreement shall be
      invalid, illegal or unenforceable in any jurisdiction, the validity,
      legality and enforceability of the remaining provisions or obligations
      under this Agreement, or of such provision or obligation in any other
      jurisdiction, shall not be affected or impaired thereby.

17.   Third Party Rights

      A person who is not a party to this Agreement may not enforce any of its
      terms under the Contracts (Rights of Third Parties) Act 1999, but this
      shall not affect any right or remedy of a third party which exists or is
      available apart from that Act.

18.   Governing Law and Jurisdiction; Process Agents; Appropriate Forum

18.1  Governing  Law: This  Agreement is governed by, and shall be construed
      in accordance with, English law.

18.2  Jurisdiction: Each of the parties hereto irrevocably agrees that the
      courts of England are to have jurisdiction to settle any suit, action or
      proceeding and to settle any disputes which may arise out of or in
      connection with this Agreement and, for such purposes, irrevocably
      submit to the jurisdiction of such courts.

18.3  Process Agents: Funding irrevocably and unconditionally appoints Mourant
      & Co. Capital (SPV) Limited at 4 Royal Mint Court, London EC3N 4HJ or
      otherwise at the registered office of Mourant & Co. Capital (SPV)
      Limited for the time being as its agent for service of process in
      England in respect of any proceedings in respect of this Agreement and
      undertakes that in the event of Mourant & Co. Capital (SPV) Limited
      ceasing so to act it will appoint another person with a registered
      office in London as its agent for service of process.

18.4  Appropriate Forum: Each of the parties hereto irrevocably waives any
      objection which it might now or hereafter have to the courts of England
      being nominated as the forum to hear and determine any Proceedings and
      to settle any disputes, and agrees not to claim that any such court is
      not a convenient or appropriate forum.


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                                 SCHEDULE 1

                       REPRESENTATIONS AND WARRANTIES

Each party to the Current Issuer Start-Up Loan Agreement (the "Agreement")
hereby makes the following representations and warranties to each of the other
parties to such Agreement:

1.    Status: It is duly incorporated, validly existing and registered under
      the laws of the jurisdiction in which it is incorporated, capable of
      being sued in its own right and not subject to any immunity from any
      proceedings, and it has the power to own its property and assets and to
      carry on its business as it is being conducted.

2.    Powers and authority: It has the power to enter into, perform and
      deliver, and has taken all necessary corporate and other action to
      authorise the execution, delivery and performance by it of the
      Agreement, which has been duly executed and delivered by it.

3.    Legal validity: The Agreement constitutes, or when executed in
      accordance with its terms will constitute, its legal, valid and binding
      obligation.

4.    Non-conflict: The execution by it of the Agreement and the exercise by
      it of its rights and the performance of its obligations under the
      Agreement will not:

      (a)   result in the existence or imposition of, nor oblige it to create,
            any Security Interest in favour of any person over all or any of
            its present or future revenues or assets save for any which are
            created under or pursuant to the Funding Deed of Charge;

      (b)   conflict with any document which is binding upon it or any of its
            assets;

      (c)   conflict with its constitutional documents; or

      (d)   conflict with any law, regulation or official or judicial order of
            any government, governmental body or court, domestic or foreign,
            having jurisdiction over it.

5.    No litigation: It is not a party to any material litigation, arbitration
      or administrative proceedings and, to its knowledge, no material
      litigation, arbitration or administrative proceedings are pending or
      threatened against it.

6.    Consents and Licences: All governmental consents, licences and other
      approvals and authorisations required in connection with the entry into,
      performance, validity and enforceability of, the transaction
      contemplated by the Agreement have been obtained or effected (as
      appropriate) and are in full force and effect.


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                               EXECUTION PAGE

Funding

Executed by
GRANITE FINANCE FUNDING LIMITED
as follows:                              By
Signed for and on its behalf by            ----------------------------------
one of its duly authorised                 Duly Authorised Attorney/Signatory
attorneys/signatories
                                       Name
                                           ----------------------------------




The Current Issuer Start-Up Loan Provider

Executed by
NORTHERN ROCK PLC
as follows:                              By
Signed for and on its behalf by            ----------------------------------
one of its duly authorised                 Duly Authorised Attorney/Signatory
attorneys/signatories
                                       Name
                                           ----------------------------------




The Security Trustee

Executed by
BANK OF NEW YORK
as follows:                              By
Signed for and on its behalf by            ----------------------------------
one of its duly authorised                 Duly Authorised Attorney/Signatory
attorneys/signatories
                                       Name
                                           ----------------------------------



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