EXHIBIT 4.2




                             Dated 26 January 2004
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                               NORTHERN ROCK PLC
                   as Seller, Cash Manager and a Beneficiary



                        GRANITE FINANCE FUNDING LIMITED
                         as Funding and a Beneficiary



                                    - and -

                       GRANITE FINANCE TRUSTEES LIMITED
                             as Mortgages Trustee



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                                EIGHTH AMENDED
                             MORTGAGES TRUST DEED

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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

Clause                                                              Page No.

1.    Definitions and Construction.........................................2

2.    Creation of Mortgages Trust..........................................2

3.    Conditions Precedent.................................................3

4.    Consideration........................................................5

5.    Increasing and Decreasing the Seller Share of the Trust Property.....8

6.    Increasing the Funding Share of the Trust Property...................9

7.    Initial Funding Share and Initial Seller Share......................11

8.    Adjustment of Funding Share Percentage and Seller Share Percentage..11

9.    Minimum Seller Share................................................24

10.   Distribution of Revenue Receipts....................................26

11.   Distribution of Principal Receipts..................................29

12.   Allocation of Losses................................................33

13.   Overpayments........................................................33

14.   Arrears.............................................................34

15.   Ledgers.............................................................34

16.   Fees and Expenses of the Mortgages Trustee..........................35

17.   Directions from Beneficiaries.......................................36

18.   Early Termination of the Mortgages Trust............................37

19.   Audit of Mortgage Loans constituting the Trust Property.............37

20.   Transfers...........................................................37

21.   Representations and Covenants.......................................38

22.   Power to Delegate...................................................39

23.   Powers of Investment................................................39

24.   Other Provisions regarding the Mortgages Trustee....................40

25.   No retirement of Mortgages Trustee..................................41



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26.   Termination.........................................................42

27.   Further Assurances..................................................42

28.   No Partnership or Agency............................................42

29.   Calculations........................................................42

30.   Confidentiality.....................................................42

31.   Perpetuity Period...................................................43

32.   Non Petition Covenant; Limited Recourse.............................43

33.   Amendments and Waiver...............................................45

34.   Notices.............................................................45

35.   Third Party Rights..................................................46

36.   Execution in Counterparts; Severability.............................46

37.   Governing Law and Submission to Jurisdiction........................47

SCHEDULE 1 REPRESENTATIONS AND WARRANTIES.................................48



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THIS EIGHTH AMENDED MORTGAGES TRUST DEED DATED 26 JANUARY 2004 FURTHER AMENDS
AND RESTATES THE MORTGAGES TRUST DEED DATED 26 MARCH 2001 BETWEEN:

(1)    NORTHERN ROCK PLC (registered number 03273685), 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 Seller, and in its capacity as Cash
       Manager and in its capacity as a Beneficiary;

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

(3)    GRANITE FINANCE TRUSTEES LIMITED (registered number 79309) a private
       limited company incorporated under the laws of Jersey whose registered
       office is at 22 Grenville Street, St. Helier, Jersey JE4 8PX, Channel
       Islands in its capacity as Mortgages Trustee.

WHEREAS:

(A)    The Mortgages Trustee wishes to declare the following trusts in respect
       of the Trust Property (being on the date of this Deed, the sum of
       (GBP)100 which monies have been received by, are presently held by
       the Mortgages Trustee or to its order).

(B)    The Mortgages Trustee (acting as principal and not as agent of any
       party) has agreed to hold the Trust Property as bare trustee for the
       Beneficiaries upon, with and subject to the trusts, powers and
       provisions of this Deed. The Mortgages Trustee will receive amounts
       arising from the Trust Property and will distribute such amounts for
       the benefit of the Beneficiaries of the Mortgages Trust. It will
       delegate certain tasks in relation to the Mortgages Trust to the
       Administrator and the Cash Manager.

(C)    The Seller carries on the business of, inter alia, originating
       residential mortgage loans to individual Borrowers in England and Wales
       and Scotland and of managing and administering such mortgage loans. The
       Seller intends to sell and assign from time to time portfolios of such
       mortgage loans to the Mortgages Trustee pursuant to the Mortgage Sale
       Agreement entered into on or about 26 March 2001, which mortgage loans
       shall be held by the Mortgages Trustee as bare trustee for the
       Beneficiaries upon, with and subject to the trusts, powers and
       provisions of this Deed.

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NOW THIS DEED WITNESSES:

1.     Definitions and Construction

1.1.   The provisions of 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 [ ] January
       2004 between, amongst others, the Seller, Funding and the Mortgages
       Trustee (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 Deed.

2.     Creation of Mortgages Trust

2.1    Initial Trust Property: The Mortgages Trustee hereby declares itself as
       trustee of the Trust Property, being, upon execution of this Deed, the
       sum of (GBP)100 (one hundred pounds) (the "Initial Trust Property")
       which sum shall be held on trust by the Mortgages Trustee absolutely as
       to both capital and income for the benefit, as tenants in common
       (holding undivided beneficial interests), of the Seller as to the
       Initial Seller Share Percentage and Funding as to the Initial Funding
       Share Percentage. The Initial Trust Property shall be held by the
       Mortgages Trustee on the Mortgages Trust upon due execution of this
       Deed by all parties to it.

2.2    Closing Trust Property: Pursuant to the provisions of the Mortgage Sale
       Agreement, the Seller intends to sell and assign the Initial Mortgage
       Portfolio to the Mortgages Trustee on the Initial Closing Date, which
       Initial Mortgage Portfolio including all related rights and benefits
       shall form part of the Trust Property (the "Closing Trust Property").

2.3    New Trust Property: From time to time and pursuant to the Mortgage Sale
       Agreement, the Seller intends to sell and assign New Mortgage
       Portfolios to the Mortgages Trustee, which New Mortgage Portfolios
       including all related rights and benefits shall form part of the Trust
       Property (the "New Trust Property").

2.4    Other Trust Property:

       (a)  In accordance with this Deed, from time to time Funding and the
            Seller shall, subject to and in accordance with Clause 4
            (Consideration), Clause 5 (Increasing the Seller Share of the
            Trust Property) and/or Clause 6 (Increasing the Funding Share of
            the Trust Property) provide consideration to the Mortgages Trustee
            in the form of Contributions to be applied by the Mortgages
            Trustee as set out in this Deed. Any



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            Contribution so provided to the Mortgages Trustee shall, on receipt
            by the Mortgages Trustee and until it has been applied by the
            Mortgages Trustee in accordance with the terms of this Deed, form
            part of the Trust Property.

       (b)  Any Re-draws made under a Flexible Mortgage Loan which is included
            in the Trust Property will form part of the Trust Property.

       (c)  Amounts on deposit (and interest earned on such amounts) from time
            to time in the Mortgages Trustee Bank Accounts will form part of
            the Trust Property.

       (d)  (If the Seller subsequently decides to retain any Mortgage Loan
            which is the subject of a Further Advance within the Trust
            Property and/or to sell and assign the Further Advance to the
            Mortgages Trustee in accordance with the Mortgage Sale Agreement)
            any Further Advance made in respect of a Mortgage Loan in the
            Trust Property will also form part of the Trust Property.

       (e)  Any Permitted Replacement Mortgage Loan and its Related Security
            (including the rights under any related MIG Policy and other
            insurance policies arranged by the Seller, but excluding any Early
            Repayment Charge Receipts paid to the Seller) relating to a
            Permitted Product Switch effected in relation to a Mortgage Loan
            which forms part of the Trust Property will also form part of the
            Trust Property.

       (f)  The proceeds of sale of any Mortgage Loan and its Related Security
            forming part of the Trust Property pursuant to the Mortgage Sale
            Agreement or other proceeds of sale of any Trust Property will
            form part of the Trust Property.

       (g)  Any Further Draws under a Personal Secured Loan which is included
            in the Trust Property will also form part of the Trust Property.

2.5    Payments of Early Repayment Charges: Subject to and in accordance with
       the Mortgage Sale Agreement, the Mortgages Trustee will agree to pay to
       the Seller any Early Repayment Charge Receipts received by the Mortgage
       Trustee in respect of any Mortgage Loan included in the Initial
       Mortgage Portfolio or any New Mortgage Portfolio which the Seller sells
       and assigns to the Mortgages Trustee. Upon any such payment to the
       Seller, the benefit of such Early Repayment Charges will no longer form
       part of the Trust Property.

3.     Conditions Precedent

3.1    Trust Property: Subject to this Clause 3 (Conditions Precedent), the
       Mortgages Trustee shall hold the Trust Property as to both capital and
       income on trust absolutely for Funding (as to



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       the Funding Share) and for the Seller (as to the Seller Share) as
       tenants in common upon, with and subject to all the trusts, powers and
       provisions of this Deed (such that each Beneficiary shall have an
       undivided beneficial interest in the Trust Property). As used herein,
       "Trust Property" means the Initial Trust Property, the Closing Trust
       Property, any New Trust Property, (but excludes any Early Repayment
       Charge Receipts which have been paid to the Seller and any Mortgage
       Loans which have been repurchased by the Seller pursuant to the
       Mortgage Sale Agreement) and all other Trust Property referred to under
       Clause 2 (Creation of Mortgages Trust) less (a) any actual Losses in
       relation to Mortgage Loans and any actual redemptions occurring in
       respect of the Mortgage Loans as described in Clause 8.5 (Adjustments
       to Trust Property) and (b) distributions of principal made from time to
       time to the Beneficiaries.

3.2    Closing Trust Property: The Closing Trust Property shall be held by the
       Mortgages Trustee on the Mortgages Trust subject to satisfaction of the
       following conditions precedent:

       (a)  the due execution and delivery of the Mortgage Sale Agreement by
            all parties to it;

       (b)  the due execution and delivery of this Deed by all parties to it;

       (c)  the satisfaction or waiver in accordance with the terms of the
            Mortgage Sale Agreement of the conditions to the sale and
            assignment of the Initial Mortgage Portfolio as set out in Clause
            2 (Sale and Purchase of Initial Mortgage Portfolio) and Clause 3
            (Initial Closing Date) of the Mortgage Sale Agreement;

       (d)  the payment by Funding to the Mortgages Trustee of Funding's
            Initial Contribution for the Initial Funding Share Percentage in
            accordance with Clause 4 (Consideration); and

       (e)  the payment by the Mortgages Trustee to the Seller of the Initial
            Purchase Price for the sale and assignment to the Mortgages
            Trustee of the Initial Mortgage Portfolio.

3.3    New Trust Property: Any New Trust Property shall be held by the
       Mortgages Trustee on the Mortgages Trust subject to the satisfaction or
       waiver in accordance with the terms of the Mortgage Sale Agreement of
       the conditions referred to in Clause 4 (Sale and Purchase of New
       Mortgage Loan Portfolios) of the Mortgage Sale Agreement for the
       transfer of New Mortgage Loan Portfolios to the Mortgages Trustee.



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4.     Consideration

4.1    Consideration provided by Seller: The Seller in its capacity as a
       Beneficiary shall provide consideration to the Mortgages Trustee for
       the Seller Share in the Trust Property:

       (a)  on the Initial Closing Date, by selling and assigning to the
            Mortgages Trustee the Initial Mortgage Portfolio upon payment by
            the Mortgages Trustee to the Seller of the Initial Purchase Price
            for the Initial Mortgage Portfolio in accordance with the terms of
            the Mortgage Sale Agreement;

       (b)  on each date after the Initial Closing Date on which (i) New
            Mortgage Loans are acquired by the Mortgages Trustee from the
            Seller in accordance with the Mortgage Sale Agreement and (ii) the
            consideration provided to the Seller for that sale is or includes
            the covenant of the Mortgages Trustee to hold the Trust Property
            on trust for Funding (as to the Funding Share) and the Seller (as
            to the Seller Share) in accordance with the terms of this Deed, by
            the sale on such date by the Seller of such New Mortgage Loans
            either for the payment by the Mortgages Trustee of the Initial
            Purchase Price paid on such date or (if no Initial Purchase Price
            is paid) without payment on such date; and

       (c)  on each date on which the Seller increases the Seller Share of the
            Trust Property in accordance with Clause 5 (Increasing and
            Decreasing the Seller Share of the Trust Property) below, the
            Seller will pay the consideration to the Mortgages Trustee
            specified in that Clause.

4.2    Consideration provided by Funding: Funding in its capacity as a
       Beneficiary shall provide consideration to the Mortgages Trustee for
       the Funding Share in the Trust Property:

       (a)  on the Initial Closing Date, by paying to the Mortgages Trustee
            the Initial Contribution in respect of the Closing Trust Property
            which shall be equal to (and from which the Mortgages Trustee
            shall or shall procure that the Cash Manager on its behalf shall
            pay) the Initial Purchase Price in respect of the Initial Mortgage
            Portfolio payable by the Mortgages Trustee to the Seller pursuant
            to the Mortgage Sale Agreement on such date;

       (b)  on each Distribution Date, by paying to the Mortgages Trustee a
            Deferred Contribution equal to the amount (if any) of:



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            (i)   Mortgages Trustee Available Revenue Receipts to which
                  Funding is entitled on such date in accordance with
                  paragraph (d) of Clause 10.2 (Distribution of Mortgages
                  Trustee Available Revenue Receipts); and

            (ii)  the amount of any Early Repayment Charge Receipts payable by
                  the Mortgage Trustee to the Seller under the Mortgage Sale
                  Agreement,

            (together the "Relevant Distribution") which shall be equal to
            (and from which the Mortgages Trustee shall or shall procure that
            the Cash Manager on its behalf shall pay) such amount of Deferred
            Purchase Price as is payable by the Mortgages Trustee to the
            Seller pursuant to the Mortgage Sale Agreement on such date. The
            parties to this Deed agree that on any Distribution Date the
            Relevant Distribution and the Deferred Contribution payable by
            Funding to the Mortgages Trustee shall be set off against each
            other such that as between the Mortgages Trustee and Funding no
            amount shall be payable in respect of such Relevant Distribution
            or such Deferred Contribution on such date and the Cash Manager on
            behalf of the Mortgages Trustee shall pay to the Seller (in
            satisfaction of the Mortgages Trustee's obligation to pay Deferred
            Purchase Price to the Seller under the Mortgage Sale Agreement)
            those funds which, were it not for such set-off, would have been
            payable to Funding as the Relevant Distribution;

       (c)  unless Funding has given notice to each relevant Previous Issuer
            of its intention to use the proceeds of a New Intercompany Loan to
            repay one or more of the Intercompany Loans from the Previous
            Issuers, and subject to Clause 6 (Increasing the Funding Share of
            the Trust Property) below, on each date after the Initial Closing
            Date on which (i) an amount of Initial Purchase Price is payable
            in respect of New Mortgage Loans which are sold and assigned by
            the Seller to the Mortgages Trustee on such date and (ii) Funding
            receives the net proceeds of a New Intercompany Loan from a New
            Issuer, by paying to the Mortgages Trustee an Initial Contribution
            in respect of such New Trust Property which shall be equal to (and
            from which the Mortgages Trustee shall or shall procure that the
            Cash Manager on its behalf shall pay) the Initial Purchase Price
            in respect of such New Mortgage Loans payable by the Mortgages
            Trustee to the Seller pursuant to the Mortgage Sale Agreement on
            such date;

       (d)  unless Funding has given notice to each relevant Previous Issuer
            of its intention to use the proceeds of a New Intercompany Loan to
            repay one or more of the



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            Intercompany Loans from the Previous Issuers subject to Clause 6
            (Increasing the Funding Share of the Trust Property) below, on
            each other date after the Initial Closing Date on which Funding
            receives the net proceeds of a New Intercompany Loan from a New
            Issuer, by paying to the Mortgages Trustee a Further Contribution
            in respect of the Funding Share of the Trust Property which shall
            be equal to (and from which the Mortgages Trustee shall or shall
            procure that the Cash Manager on its behalf shall pay) the Initial
            Consideration payable to the Seller in accordance with Clause 6.3
            (Initial Consideration); and

       (e)  following the Final Repayment Date of the latest maturing
            Intercompany Loan made by any Issuer to Funding and provided that
            there are no further claims outstanding under any Intercompany
            Loan or on such earlier date provided that all Intercompany Loans
            have either been repaid in full or there are no further claims
            outstanding under any Intercompany Loan, Funding will make a final
            payment of Deferred Contribution to the Mortgages Trustee (the
            "Final Deferred Contribution") in an amount equal to the aggregate
            amount standing to the credit of the Funding Bank Accounts
            (including any account established for the purposes of the Issuer
            Reserve Fund and/or the Issuer Liquidity Reserve Fund of any
            Issuer) after making any payments ranking in priority thereto,
            subject to and in accordance with the relevant Funding Priority of
            Payments. The Final Deferred Contribution shall be in an amount
            equal to (and from that Final Deferred Contribution the Mortgages
            Trustee shall or shall procure that the Cash Manager shall on its
            behalf pay) the final amount of Deferred Purchase Price payable by
            the Mortgages Trustee to the Seller pursuant to and in accordance
            with the Mortgage Sale Agreement.

4.3    Application by Mortgages Trustee:

       (a)  If the Mortgages Trustee receives any Initial Contribution,
            Deferred Contribution or the Final Deferred Contribution from
            Funding, the parties hereto direct the Mortgages Trustee to, and
            the Mortgages Trustee covenants that it shall, or shall procure
            that the Cash Manager on its behalf shall, pay such funds to the
            Seller in satisfaction of the Mortgages Trustee's obligation to
            make payment of the Initial Purchase Price or, as the case may be,
            Deferred Purchase Price in respect of the Initial Mortgage
            Portfolio or any New Mortgage Loans which are sold and assigned to
            the Mortgages Trustee by the Seller pursuant to the Mortgage Sale
            Agreement.



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       (b)  If the Mortgages Trustee receives a Further Contribution from any
            Beneficiary, the parties hereto direct the Mortgages Trustee to,
            and the Mortgages Trustee covenants that it shall, or shall
            procure that the Cash Manager on its behalf shall, distribute such
            funds to a Beneficiary or the Beneficiaries as required at the
            time and in the manner and otherwise in accordance with the terms
            of this Deed.

5.     Increasing and Decreasing the Seller Share of the Trust Property

5.1    Re-draws under Flexible Mortgage Loans:

       (a)  If, in respect of any Flexible Mortgage Loan which is in the Trust
            Property, the relevant Borrower requests a Cash Re-draw and the
            Administrator (on behalf of the Mortgages Trustee) grants such
            request pursuant to and in accordance with the terms of the
            Administration Agreement, the Seller as Beneficiary shall fund
            that Cash Re-draw in the Mortgages Trust by making payment to the
            Borrower, in accordance with the terms and conditions of the
            relevant Mortgage Loan, of the Cash Re-draw Amount. Upon payment
            by the Seller to the relevant Borrower of the Cash Re-draw Amount,
            the aggregate Current Balance of the Mortgage Loans constituting
            the Trust Property and the amount of the Seller Share of the Trust
            Property shall be increased by an amount equal to the Cash Re-draw
            Amount.

       (b)  If, in respect of any Flexible Mortgage Loan which is in the Trust
            Property, the relevant Borrower requests a Non-Cash Re-draw and
            the Administrator grants such request or the Administrator
            otherwise permits the relevant Borrower to take a Non-Cash Re-draw
            pursuant to and in accordance with the terms of the Administration
            Agreement, the Seller as Beneficiary shall fund such Non-Cash
            Re-draw in the Mortgages Trust by making payment to the Mortgages
            Trustee of a Further Contribution in an amount equal to the Unpaid
            Interest Amount in respect of such Non-Cash Re-draw. Upon payment
            by the Seller to the Mortgages Trustee of such Further
            Contribution, the aggregate Current Balance of the Mortgage Loans
            constituting the Trust Property and the Seller Share of the Trust
            Property shall be increased by an amount equal to the amount of
            the Further Contribution so made to the Mortgages Trustee. The
            parties agree that any such Further Contribution received by the
            Mortgages Trustee from the Seller will be treated as Revenue
            Receipts and will be distributed to the Beneficiaries on the
            immediately succeeding Distribution Date in accordance with Clause
            10 (Distribution of Revenue Receipts) below.

5.2    Further Advances: If at a future date the Seller elects not to purchase
       any Mortgage Loan



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       which becomes the subject of a Further Advance from the Mortgages
       Trustee, the Seller will be solely responsible for funding any such
       Further Advance and, subject to the provisions of this Deed, upon the
       making of such Further Advance by the Seller, the aggregate Current
       Balance of the Mortgage Loans constituting the Trust Property and the
       Seller Share of the Trust Property shall be increased by an amount
       equal to the amount of the Further Advance paid to the relevant
       Borrower.

5.3    Together Connections Mortgage Loans and Connections Mortgage Loans: If,
       in respect of any Together Connections Mortgage Loan or any Connections
       Mortgage Loan which is in the Trust Property, there has been a
       reduction in the outstanding balance of such Mortgage Loan from the
       relevant Borrower being allocated a portion of the Together Connections
       Mortgage Benefit or Connections Benefit (as the case may be) under such
       Mortgage Loan, the aggregate Current Balance of the Mortgage Loans
       constituting the Trust Property and the amount of the Seller Share of
       the Trust Property shall be decreased by an amount equal to the portion
       of the Together Connections Benefit or Connections Benefit (as the case
       may be) allocated to such Mortgage Loan.

5.4    Further Draws under Personal Secured Loans: If, in respect of any
       Personal Secured Loan in the Trust Property which permits Further
       Draws, the relevant Borrower requests a Further Draw and the
       Administrator grants such request, the Seller will as Beneficiary fund
       such Further Draw in the Mortgages Trust by making payment to the
       Borrower of the Further Draw in accordance with the terms and
       conditions of the relevant Personal Secured Loan. Upon payment by the
       Seller to the relevant Borrower of such Further Draw, the aggregate
       Current Balance of the Mortgage Loans constituting the Trust Property
       and the amount of the Seller Share of the Trust Property shall be
       increased by an amount equal to the amount of the Further Draw paid to
       the relevant Borrower.

6.     Increasing the Funding Share of the Trust Property

6.1    Conditions precedent: Subject as provided below, Funding may increase
       the Funding Share (as defined in Clause 7.1 (Initial Funding Share)
       below) of the Trust Property, subject to satisfaction of the following
       conditions precedent:

       (a)  no Event of Default under the Transaction Documents shall have
            occurred which is continuing at the relevant date;

       (b)  no Intercompany Loan Enforcement Notice has been served in respect
            of any Intercompany Loan;



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       (c)  the Rating Agencies have confirmed in writing to the Mortgages
            Trustee, the Security Trustee and each Issuer that the proposed
            increase in the Funding Share of the Trust Property would not
            adversely affect the then-current ratings by the Rating Agencies
            (or any of them) of the Notes issued by any Issuer;

       (d)  the New Notes have been issued by the New Issuer, the subscription
            proceeds received on behalf of such New Issuer and advanced by
            such Issuer to Funding pursuant to an Intercompany Loan Agreement
            (which proceeds Funding will pay to the Mortgages Trustee to
            increase the Funding Share of the Trust Property on the relevant
            date in accordance with Clause 6.2 (Completion));

       (e)  if necessary, each Issuer, including any New Issuer (if any) has
            entered into appropriate hedging arrangements;

       (f)  as of the last day of the immediately preceding Trust Calculation
            Period the aggregate Current Balance of Mortgage Loans in the
            Trust Property which were at such time in arrears for at least 3
            months is less than 4 per cent. of the aggregate Current Balance
            of all Mortgage Loans in the Trust Property at such time unless
            the Rating Agencies have confirmed that the then-current ratings
            of the Notes will not be adversely affected;

       (g)  as of the last day of the immediately preceding Trust Calculation
            Period the weighted average LTV ratio of Mortgage Loans in the
            Trust Property (after application of the LTV Test) on such date
            does not exceed the LTV ratio (based on the LTV Test) of Mortgage
            Loans in the Trust Property on the Initial Closing Date plus 0.25
            per cent.;

       (h)  each Issuer Reserve Fund is fully funded on the relevant date up
            to the relevant Issuer Reserve Required Amount; and

       (i)  as at the most recent Payment Date no deficiency was recorded on
            the Issuer Principal Deficiency Ledger of any Issuer,

       provided always that Funding shall not be entitled to increase the
       Funding Share after the Payment Date falling in January 2008 if the
       option to redeem the First Issuer Notes on the Payment Date in January
       2008 pursuant Condition 5 of the First Issuer Notes is not exercised.

6.2    Completion: Subject to satisfaction of the conditions precedent set out
       in Clause 6.1 (Conditions precedent) above, Funding shall pay to the
       Mortgages Trustee the consideration for such increase in the Funding
       Share in accordance with Clause 4 (Consideration).



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6.3    Initial Consideration: The parties hereto agree that Principal Receipts
       received by the Mortgages Trustee from Funding in payment of a Further
       Contribution in accordance with Clause 4 (Consideration) on any date on
       which Funding increases the Funding Share of the Trust Property shall
       be allocable and payable by the Mortgages Trustee to the Seller (in its
       capacity as a Beneficiary of the Mortgages Trust) as an Initial
       Consideration on such date whether or not such date is a Distribution
       Date. Any such Initial Consideration shall reduce the Seller Share of
       the Trust Property by the amount of the Initial Consideration.

7.     Initial Funding Share and Initial Seller Share

7.1    Initial Funding Share: The "Initial Funding Share" of the Trust
       Property shall be (pound)86.61 at the date of this Deed and
       (GBP)1,500,000,000 at the Initial Closing Date and the "Initial
       Funding Share Percentage" shall be the Initial Funding Share expressed
       as a percentage of the Trust Property at such date, that is to say,
       86.61 per cent. References herein to the "Funding Share" shall mean,
       prior to the first Distribution Date, the Initial Funding Share and
       thereafter shall mean the Current Funding Share (as defined below).

7.2    Initial Seller Share: The "Initial Seller Share" of the Trust Property
       shall be the sum which remains of the Trust Property after deduction of
       the Initial Funding Share. The Initial Seller Share of the Trust
       Property will be (GBP)13.39 at the date of this Deed and
       (GBP)232,000,000 at the Initial Closing Date and the "Initial Seller
       Share Percentage" shall be equal to 100 per cent. minus the Initial
       Funding Share Percentage, that is to say, 13.39 per cent. The amount of
       the Initial Seller Share and the Initial Seller Share Percentage on the
       Initial Closing will be determined immediately after the Initial
       Closing Date. References herein to the "Seller Share" shall mean, prior
       to the first Distribution Date, the Initial Seller Share and thereafter
       shall mean the Current Seller Share (as defined below).

7.3    Rounding of percentage shares: Except for the Initial Closing Date on
       which the Funding Share Percentage and the Seller Share Percentage
       shall be calculated to two decimal places, and unless otherwise agreed
       by the Beneficiaries, the Current Funding Share Percentage and the
       Current Seller Share Percentage shall be calculated to five decimal
       places.

8.     Adjustment of Funding Share Percentage and Seller Share Percentage

8.1    Effective Periods:

       (a)  Subject to Clause 8.1(b) below, the Cash Manager will (on behalf
            of the Mortgages Trustee and the Beneficiaries) recalculate the
            Funding Share, the Funding Share



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            Percentage, the Seller Share and the Seller Share Percentage in
            respect of each Trust Calculation Period on the Distribution Date
            occurring in such Trust Calculation Period, based on the aggregate
            Current Balance of the Mortgage Loans constituting the Trust
            Property (as adjusted from time to time) on the last day of the
            Trust Calculation Period immediately preceding such Distribution
            Date.

       (b)  Notwithstanding Clause 8.1(a) above, if during any Trust
            Calculation Period the Seller sells and assigns New Mortgage Loans
            to the Mortgages Trustee or if Funding pays a Further Contribution
            to the Mortgages Trustee to increase the Funding Share of the
            Trust Property, the recalculation of the Funding Share, the
            Funding Share Percentage, the Seller Share and the Seller Share
            Percentage made by the Cash Manager on the Distribution Date
            occurring in such Trust Calculation Period will be effective only
            in respect of the period beginning on (and including) the first
            day of such Trust Calculation Period and ending on (but excluding)
            the first Assignment Date or Funding Contribution Date, as
            applicable, to occur during such Trust Calculation Period (such
            period in respect of such Distribution Date, an "Interim
            Calculation Period"), based on the aggregate Current Balance of
            the Mortgage Loans constituting the Trust Property (as adjusted
            from time to time) on the last day of the Trust Calculation Period
            immediately preceding such Distribution Date.

       (c)  In addition to the foregoing, if during any Trust Calculation
            Period the Seller sells and assigns New Mortgage Loans to the
            Mortgages Trustee or if Funding pays a Further Contribution to the
            Mortgages Trustee to increase the Funding Share of the Trust
            Property, the Cash Manager will (on behalf of the Mortgages
            Trustee and the Beneficiaries) recalculate the Funding Share, the
            Funding Share Percentage, the Seller Share and the Seller Share
            Percentage on such Assignment Date or Funding Contribution Date,
            as applicable, in respect of the period beginning on (and
            including) such Assignment Date or Funding Contribution Date, as
            applicable, and ending on the last day of such Trust Calculation
            Period (and including such last day of such Trust Calculation
            Period) (each such period in respect of each Assignment Date or
            Funding Contribution Date, as applicable, an "Interim Calculation
            Period"), based on the aggregate Current Balance of the Mortgage
            Loans constituting the Trust Property (as adjusted from time to
            time) on such Assignment Date or Funding Contribution Date, as
            applicable.

The parties acknowledge and agree that the Mortgage Sale Agreement provides
that (a) the Seller may not sell and assign New Mortgage Loans to the
Mortgages Trustee during any Trust Calculation



                                      12
<PAGE>

Period prior to the Distribution Date in such Trust Calculation Period, and
(b) the Seller may only make one sale and assignment of New Mortgage Loans to
the Mortgages Trustee during any Trust Calculation Period.

8.2    Current Funding Share Percentage:

       (a)  On each Distribution Date (the "Relevant Distribution Date"), the
            "Current Funding Share Percentage" will be calculated by the Cash
            Manager in respect of the then-current Trust Calculation Period or
            related Interim Calculation Period, as applicable, for the purpose
            of calculating the distributions to be made from the Trust
            Property on the immediately succeeding Distribution Date, and such
            Current Funding Share Percentage will be an amount, expressed as a
            percentage (calculated to an accuracy of five decimal places
            (rounded upwards)), equal to:

                            A - B - C + D
                            ------------- x 100
                                  G

       where,

       A    =    the Current Funding Share as calculated (a) on the later of
                 the Distribution Date, the Assignment Date or Funding
                 Contribution Date (if any) immediately preceding such
                 Relevant Distribution Date, or (b) in the case of the first
                 Distribution Date, the Initial Funding Share as at the
                 Initial Closing Date;

       B    =    the amount of any Principal Receipts distributed to Funding
                 on such Relevant Distribution Date in accordance with the
                 provisions described in Clause 11 (Distribution of Principal
                 Receipts) below;

       C    =    the amount of any Losses sustained on the Mortgage Loans
                 during the Trust Calculation Period immediately preceding
                 such Relevant Distribution Date and the amount of any
                 reductions occurring in respect of the Mortgage Loans as
                 described in paragraphs (a) through (e) of Clause 8.5
                 (Adjustments to Trust Property) (inclusive) below which have
                 been allocated to Funding in the Trust Calculation Period
                 ending on the Relevant Distribution Date (based on (a) the
                 Funding Share Percentage thereof calculated on the
                 Distribution Date immediately preceding such Relevant
                 Distribution Date (provided that the Seller had not sold and
                 assigned New Mortgage Loans to the Mortgages



                                      13
<PAGE>

                 Trustee or that Funding had not paid a Further Contribution
                 to the Mortgages Trustee in the Trust Calculation Period
                 immediately preceding such Relevant Distribution Date), or
                 (b) to the extent that the Seller had sold and assigned New
                 Mortgage Loans to the Mortgages Trustee or that Funding had
                 paid a Further Contribution to the Mortgages Trustee during
                 the Trust Calculation Period immediately preceding such
                 Relevant Distribution Date, the Weighted Average Funding
                 Share Percentage (as defined below) thereof calculated on
                 such Relevant Distribution Date prior to the distribution to
                 be made on such Relevant Distribution Date, or (c) in the
                 case of the first Distribution Date, the Initial Funding
                 Share Percentage);

       D    =    an amount equal to any Capitalised Arrears which have been
                 allocated to Funding during the Trust Calculation Period
                 immediately preceding such Relevant Distribution Date (based
                 on the Funding Share Percentage thereof calculated on the
                 Distribution Date immediately preceding such Relevant
                 Distribution Date or, in the case of the first Distribution
                 Date, the Initial Funding Share Percentage);

       G    =    the amount of the Mortgages Trustee Retained Principal
                 Receipts (if any) plus the aggregate Current Balance of all
                 the Mortgage Loans in the Trust Property as at the last day
                 of the Trust Calculation Period immediately preceding such
                 Relevant Distribution Date or, if applicable, on the relevant
                 Assignment Date or Funding Contribution Date, after making
                 the distributions, allocations and additions referred to in
                 (B), (C) and (D) above and after taking account of the
                 following (being "Trust Property Calculation Adjustments")
                 (i) any distribution of Principal Receipts to the Seller and
                 to Funding, (ii) the amount of any Losses allocated to the
                 Seller and to Funding, (iii) the adjustments referred to in
                 paragraphs (a) through (e) of Clause 8.5 (Adjustments to
                 Trust Property) (inclusive) below; (iv) the amount of any
                 other additions to or removals from the Trust Property during
                 such Trust Calculation Period, including without limitation,
                 any additions to the Trust Property resulting from Cash
                 Re-draws, Non-Cash Redraws and Further Draws by Borrowers
                 under Flexible Mortgage Loans which are in the Trust Property
                 or (if the Seller subsequently elects not to repurchase
                 Mortgage Loans which are the subject of Further Advances from
                 the Mortgages Trustee) Further Advances sold and assigned by
                 the Seller; but excluding the addition of mortgage loans on
                 an Assignment Date and any



                                      14
<PAGE>

                 Initial Contribution or Further Contribution made by Funding
                 during such Trust Calculation Period and (v) any reduction in
                 the outstanding principal balances of Together Connections
                 Mortgage Loans and Connections Mortgage Loans resulting from
                 Borrowers being allocated a portion of the related Together
                 Connections Benefit and Connections Benefit, respectively
                 under such Mortgage Loans.

       (b)  If during any Trust Calculation Period the Seller sells and
            assigns New Mortgage Loans to the Mortgages Trustee, the Cash
            Manager will recalculate the Current Funding Share Percentage on
            each such Assignment Date which is not also a Funding Contribution
            Date (the "Relevant Assignment Date") in respect of the related
            Interim Calculation Period, for the purposes of calculating the
            distributions to be made from the Trust Property on the
            immediately succeeding Distribution Date and determining the
            amount of losses to be allocated to Funding, and such Current
            Funding Share Percentage will be an amount, expressed as a
            percentage (calculated to an accuracy of five decimal places
            (rounded upwards)), equal to:

                             A + E
                             ----- x 100
                               H

       where,

       A =  the Current Funding Share as calculated on the Distribution Date
            immediately preceding such Relevant Assignment Date;

       E =  an amount equal to any Initial Contribution paid by Funding to the
            Mortgages Trustee on such Relevant Assignment Date in relation to
            the Funding Share of any New Mortgage Loans assigned to the
            Mortgages Trustee on such Relevant Assignment Date (which amount
            the Mortgages Trustee is required pursuant to Clause 4.3
            (Application by Mortgages Trustee) to pay to the Seller in
            satisfaction of the Mortgages Trustee's obligation to pay to the
            Seller the Initial Purchase Price in respect of New Mortgage Loans
            sold and assigned to the Mortgages Trustee on such Relevant
            Assignment Date); and

       H =  the amount of the Mortgages Trustee Retained Principal Receipts
            (if any), plus the aggregate Current Balance of all the Mortgage
            Loans in the Trust Property as at the Distribution Date
            immediately preceding such Relevant Assignment Date (after making
            the distributions, allocations and additions on that preceding
            Distribution Date), plus the aggregate Current Balance of the New
            Mortgage Loans sold


                                      15
<PAGE>

            and assigned to the Mortgages Trustee on such Relevant Assignment
            Date and after taking account of Trust Property Calculation
            Adjustments.

       (c)  If during any Trust Calculation Period Funding pays a Further
            Contribution to the Mortgages Trustee to increase the Funding
            Share of the Trust Property, the Cash Manager will recalculate the
            Current Funding Share Percentage on each such Funding Contribution
            Date (the "Relevant Funding Contribution Date") in respect of the
            related Interim Calculation Period, for the purposes of
            calculating the distributions to be made from the Trust Property
            and determining the amount of losses to be allocated to Funding on
            the immediately succeeding Distribution Date, and such Current
            Funding Share Percentage will be an amount, expressed as a
            percentage (calculated to an accuracy of five decimal places
            (rounded upwards)), equal to:

                              A + E + F
                              --------- x 100
                                  J

       where,

       A = the Current Funding Share as calculated on the Distribution Date
            immediately preceding such Relevant Funding Contribution Date;

       E = (1) if that Relevant Funding Contribution Date is also an
            Assignment Date, the amount of any Initial Contribution paid by
            Funding to the Mortgages Trustee on that Funding Contribution Date
            in respect of the Funding Share of any New Trust Property, and (2)
            in all other cases, zero;

       F =  an amount equal to any Further Contribution paid by Funding to the
            Mortgages Trustee on such Relevant Funding Contribution Date to
            increase Funding's beneficial interest in the Trust Property; and

       J =  the amount of the Mortgages Trustee Retained Principal Receipts
            (if any) plus the aggregate Current Balance of all the Mortgage
            Loans in the Trust Property as at the Distribution Date
            immediately preceding such Relevant Funding Contribution Date
            (after making the distributions, allocations and additions on that
            preceding Distribution Date) plus the aggregate Current Balance of
            the New Mortgage Loans sold and assigned to the Mortgages Trustee
            on that Relevant Assignment Date and after taking account of Trust
            Property Calculation Adjustments.

8.3    Weighted Average Funding Share Percentage: On any Distribution Date in
       respect to which



                                      16
<PAGE>

       (i) the Seller had sold and assigned New Mortgage Loans to the
       Mortgages Trustee, or (ii) Funding had paid a Further Contribution to
       the Mortgages Trustee to increase the Funding Share of the Trust
       Property, during the Trust Calculation Period immediately preceding
       such Distribution Date, the Cash Manager (on behalf of the
       Beneficiaries) will calculate (for the sole purpose of making the
       distributions to be made on such Distribution Date) the weighted
       average of the Current Funding Share Percentages that were calculated
       previously in respect of each Interim Calculation Period occurring in
       such immediately preceding Trust Calculation Period based on the amount
       of Revenue Receipts and Principal Receipts received and Losses
       sustained during each such Interim Calculation Period. The "Weighted
       Average Funding Share Percentage" for any such Distribution Date will
       be equal to:

       (a)  in respect of the distribution of Revenue Receipts to be made on
            such Distribution Date, an amount determined in accordance with
            the formula set forth below:

                           (A x B)+(C x D)

       where,

       A =  the related Current Funding Share Percentage for Interim
            Calculation Period 1;

       B =  the number of days in Interim Calculation Period 1 divided by the
            number of days in the Trust Calculation Period;

       C =  the related Funding Share Percentage for Interim Calculation
            Period 2; and

       D =  the number of days in Interim Calculation Period 2 divided by the
            number of days in the Trust Calculation Period;

       (b)  in respect of the distribution of Principal Receipts to be made on
            such Distribution Date, an amount determined in accordance with
            the formula set forth below:

                           (A x B)+(C x D)

      where,

       A =  the related Current Funding Share Percentage for Interim
            Calculation Period 1;

       B =  the number of days in Interim Calculation Period 1 divided by the
            number of days in the Trust Calculation Period;



                                      17
<PAGE>

       C =  the related Funding Share Percentage for Interim Calculation
            Period 2; and

       D =  the number of days in Interim Calculation 2 Period divided by the
            number of days in the Trust Calculation Period;

       (c)  in respect of the allocation of Losses to be made on such
            Distribution Date, an amount determined in accordance with the
            formula set forth below:

                               (A x B) + (C x D)

       where,

       A =  the Related Current Funding Share Percentage for Interim
            Calculation Period 1;

       B =  the number of days in Interim Calculation Period 1 divided by the
            number of days in the Trust Calculation Period;

       C =  the related Funding Share Percentage for Interim Calculation
            Period 2; and

       D =  the number of days in Interim Calculation Period 2 divided by the
            number of days in the Trust Calculation Period;

8.4    Current Funding Share:

       (a)  On each Distribution Date, the "Current Funding Share" will be
            calculated by the Cash Manager in respect of the then-current
            Trust Calculation Period or the related Interim Calculation
            Period, as applicable, and will be an amount equal to:

                               A - B - C + D

            where "A", "B", "C" and "D" have the meanings specified in Clause
            8.2(a) above.

       (b)  On each Assignment Date (which is not also a Funding Contribution
            Date), the Current Funding Share will be calculated by the Cash
            Manager in respect of the related Interim Calculation Period and
            will be an amount equal to:

                                    A + E

            where "A" and "E" have the meanings specified in Clause 8.2(b)
            above.



                                      18
<PAGE>

       (c)  On each Funding Contribution Date, the Current Funding Share will
            be calculated by the Cash Manager in respect of the related
            Interim Calculation Period and will be an amount equal to:

                                  A + E + F

            where "A", "E" and "F" have the meanings specified in Clause
            8.2(c) above.

8.5    Adjustments to Trust Property: If any of the following events has
       occurred during a Trust Calculation Period, then (subject to the Cash
       Manager receiving notice or otherwise being aware of the occurrence of
       the event) for the purposes of making the Trust Property Calculation
       Adjustments, the aggregate Current Balance of the Mortgage Loans
       constituting the Trust Property shall be reduced or, as the case may
       be, deemed to be reduced:

       (a)  any Borrower exercises a right of set-off in relation to any
            Mortgage Loan in the Trust Property so that the amount of
            principal and/or interest owing under such Mortgage Loan is
            reduced but no corresponding payment is received by the Mortgages
            Trustee, in which event the aggregate Current Balance of the
            Mortgage Loans constituting the Trust Property shall be reduced by
            an amount equal to the amount so set-off by such Borrower; and/or

       (b)  a Mortgage Loan or (as applicable) its Related Security (i) is in
            breach of the Representations and Warranties in the Mortgage Sale
            Agreement as at the Initial Closing Date or, as the case may be,
            the relevant Assignment Date or (ii) is the subject of a Product
            Switch or a Further Advance or in respect of which the Borrower
            has accepted an offer by the Seller of a Personal Secured Loan in
            respect of which the Seller has elected to purchase the relevant
            Mortgage Loan or Mortgage Loans and Related Security, and in the
            case of (i) above the Seller fails to repurchase and in the case
            of (ii) above the Seller fails to purchase, the relevant Mortgage
            Loan or Mortgage Loans under the relevant Mortgage Account and
            their Related Security as required by the terms of the Mortgage
            Sale Agreement; in which event the aggregate Current Balance of
            the Mortgage Loans constituting the Trust Property shall be deemed
            to be reduced for the purposes of making the Trust Property
            Calculation Adjustments by an amount equal to the Current Balance
            of the relevant Mortgage Loan or Mortgage Loans under the relevant
            Mortgage Account (together with Arrears of Interest and Accrued
            Interest) which the Seller has failed to repurchase or purchase,
            as applicable; and/or



                                      19
<PAGE>

       (c)  the Security Trustee is notified that a Flexible Mortgage Loan or
            part thereof has been determined by a court judgment on the point
            or as a result of a determination by a relevant regulatory
            authority (whether or not in relation to an analogous flexible
            mortgage loan product of another UK mortgage lender):

            (i)   to be unenforceable; and/or

            (ii)  not to fall within the first ranking charge by way of legal
                  mortgage or first ranking standard security over the
                  relevant Mortgaged Property,

            and, in either case, such Flexible Mortgage Loan is not otherwise
            subject to the repurchase obligation under the Mortgage Sale
            Agreement, in which event, the aggregate Current Balance of the
            Mortgage Loans constituting the Trust Property shall be deemed to
            be reduced for the purposes of making the Trust Property
            Calculation Adjustments by an amount equal to that portion of the
            Current Balance of the Flexible Mortgage Loan which is so
            determined to be unenforceable or not to fall within the first
            ranking charge by way of legal mortgage or first ranking standard
            security over the relevant Mortgaged Property; and/or

       (d)  (i) in respect of breaches of Representations and Warranties in
            the Mortgage Sale Agreement, the Seller would be required to
            repurchase a Mortgage Loan and its Related Security and (ii) in
            respect of a Mortgage Loan subject to a Further Advance or a
            Product Switch or in respect of which the Borrower has accepted an
            offer by the Seller of a Personal Loan, the Seller elects to
            purchase the relevant Mortgage Loan or Mortgage Loans under the
            relevant Mortgage Account and their Related Security in accordance
            with the terms of the Mortgage Sale Agreement, but such Mortgage
            Loan and its Related Security are not capable of being repurchased
            or purchased, as applicable; in which event the aggregate Current
            Balance of the Mortgage Loans constituting the Trust Property
            shall be deemed to be reduced for the purposes of making the Trust
            Property Calculation Adjustments by an amount equal to the Current
            Balance of the relevant Mortgage Loan (together with Arrears of
            Interest and Accrued Interest) which is not capable of being
            repurchased or purchased, as applicable; and/or

       (e)  the Seller breaches any other material warranty under the Mortgage
            Sale Agreement and/or (for so long as it is the Administrator) the
            Administration Agreement, in which event the aggregate Current
            Balance of Mortgage Loans constituting the Trust Property shall be
            deemed for the purposes of making the Trust Property Calculation



                                      20
<PAGE>

            Adjustments to be reduced by an amount equivalent to all losses,
            costs, liabilities, claims, expenses and damages incurred by the
            Beneficiaries as a result of such breach.

      The reductions and deemed reductions set out in paragraphs (a), (b),
      (c), (d) and (e) of this Clause and any resulting loss shall, subject to
      Clause 9.1 (Initial Minimum Seller Share), be allocated on the relevant
      Distribution Date, Assignment Date or Funding Contribution Date (as
      applicable) first to the Seller Share of the Trust Property (or for the
      purposes of calculating the Seller Share of the Trust Property as the
      case may be) until the Seller Share is zero and thereafter shall be
      allocated to the Funding Share of the Trust Property. If at, or any time
      after the Initial Closing Date the Mortgages Trustee holds, or there is
      held to its order, or it receives, or there is received to its order,
      any property, interest, right or benefit relating to the whole or that
      portion of any Mortgage Loan and its Related Security which is or has
      been subject to any matter described in paragraphs (a) through (e) above
      and in respect of which the Seller Share of the Trust Property has been
      reduced or deemed reduced such property, interest, right or benefit will
      constitute a Revenue Receipt and the Mortgages Trustee will remit,
      assign or transfer the same to Funding (but only if and to the extent
      that the related reductions or deemed reductions were applied against
      the Funding Share of the Trust Property) and thereafter to the Seller,
      as the case may require, and until it does so or to the extent that the
      Mortgage Trustee is unable to effect such remittance, assignment or
      transfer, the Mortgages Trustee will hold such property, interest, right
      or benefit and/or the proceeds thereof upon trust absolutely for Funding
      and/or the Seller (separate from the Mortgages Trust), as the case may
      require.

8.6    Current Seller Share Percentage:

       (a)  On each Distribution Date, the "Current Seller Share Percentage"
            will be calculated by the Cash Manager in respect of the
            then-current Trust Calculation Period or the related Interim
            Calculation Period, as applicable, and the distributions to be
            made from the Trust Property on the immediately succeeding
            Distribution Date, and will be a percentage equal to:

                   100% - Current Funding Share Percentage

            where the Current Funding Share Percentage is calculated on such
            Distribution Date in accordance with Clause 8.2(a) above.



                                      21
<PAGE>

       (b)  On each Assignment Date, the Cash Manager will recalculate the
            Current Seller Share Percentage in respect of the related Interim
            Calculation Period and the distributions to be made from the Trust
            Property on the immediately succeeding Distribution Date and will
            be a percentage equal to:

                   100% - Current Funding Share Percentage

            where the Current Funding Share Percentage is as calculated on
            such Assignment Date in accordance with Clause 8.2(b) above.

       (c)  On each Funding Contribution Date, the Cash Manager will
            recalculate the Current Seller Share Percentage in respect of the
            related Interim Calculation Period and the distributions to be
            made from the Trust Property on the immediately succeeding
            Distribution Date and will be a percentage equal to:

                   100% - Current Funding Share Percentage

            where the Current Funding Share Percentage is as calculated on
            such Funding Contribution Date in accordance with Clause 8.2(c)
            above.

8.7    Weighted Average Seller Share Percentage: On any Distribution Date in
       respect to which (i) the Seller had sold and assigned New Mortgage
       Loans to the Mortgages Trustee, or (ii) Funding had paid a Further
       Contribution to the Mortgages Trustee to increase the Funding Share of
       the Trust Property, during the Trust Calculation Period immediately
       preceding such Distribution Date, the Cash Manager will calculate (for
       the sole purpose of making the distributions to be made on such
       Distribution Date) the weighted average of the Seller Share Percentages
       that were calculated previously in respect of the Revenue Receipts and
       Principal Receipts received, and Losses sustained, during each Interim
       Calculation Period occurring in such immediately preceding Trust
       Calculation Period and will be a percentage equal to:

       (a)  in respect of the distribution of Revenue Receipts to be made on
            such Distribution Date:

                   100% - Weighted Average Funding Share Percentage

            where such Weighted Average Funding Share Percentage is as
            calculated in Clause 8.3(a) above;



                                      22
<PAGE>

       (b)  in respect of the distribution of Principal Receipts to be made on
            such Distribution Date:

                   100% - Weighted Average Funding Share Percentage

            where such Weighted Average Funding Share Percentage is as
            calculated in Clause 8.3(b) above; and

       (c)  in respect of the allocation of Losses to be made on such
            Distribution Date:

                   100% - Weighted Average Funding Share Percentage

            where such Weighted Average Funding Share Percentage is as
            calculated in Clause 8.3(c) above.

8.8    Current Seller Share:

       (a)  On each Distribution Date, the "Current Seller Share" will be
            calculated by the Cash Manager in respect of the then-current
            Trust Calculation Period or the related Interim Calculation
            Period, as applicable, and will be an amount equal to:

  The aggregate amount of the Trust Property as at the Relevant Distribution
                         Date - Current Funding Share

            where "Current Funding Share" has the meaning given in Clause
            8.4(a) above.

       (b)  On each Assignment Date, the Current Seller Share will be
            calculated by the Cash Manager in respect of the related Interim
            Calculation Period and will be an amount equal to:

 The aggregate amount of the Trust Property as at the Relevant Assignment Date
                            - Current Funding Share

            where "Current Funding Share" has the meaning given in Clause
            8.4(b) above.

       (c)  On each Funding Contribution Date, the Current Seller Share will
            be calculated by the Cash Manager in respect of the Interim
            Calculation Period and will be an amount equal to:

     The aggregate amount of the Trust Property as at the Relevant Funding
                   Contribution Date - Current Funding Share

            where "Current Funding Share" has the meaning given in Clause
            8.4(c) above.



                                      23
<PAGE>

8.9    Funding Share/Seller Share: Neither the Funding Share nor the Seller
       Share may be reduced below zero. At all times the Funding Share
       Percentage and the Seller Share Percentage shall be equal to 100 per
       cent. of the Trust Property.

9.     Minimum Seller Share

9.1    Initial Minimum Seller Share: The Seller Share of the Trust Property
       includes an amount equal to the Minimum Seller Share. Unless and until
       the Funding Share of the Trust Property is in an amount equal to zero,
       or following the occurrence of an Asset Trigger Event, the Seller will
       not be entitled to receive Mortgages Trustee Principal Receipts which
       would reduce the Seller Share of the Trust Property to an amount less
       than the Minimum Seller Share and the Seller consents and directs the
       Mortgages Trustee accordingly.

9.2    Fluctuation of Minimum Seller Share on each Distribution Date:

      At the Initial Closing Date, the Minimum Seller Share will be
      (GBP)50,000,000. The amount of the Minimum Seller Share will be
      recalculated on each Distribution Date in accordance with the following
      formula:

                                       W + X + Y + Z

           where:

           W   =    100% of the sum of the average cleared credit balance of
                    all applicable accounts linked to Together Connections
                    Mortgage Loans and Connections Mortgage Loans in respect
                    of each calendar month or any part of any such calendar
                    month.

           X   =    2.0% of the aggregate Current Balance of all Mortgage
                    Loans comprised in the Trust Property as at the last day
                    of the immediately preceding Trust Calculation Period;

           Y   =    the product of: p x q x r where:

               p    =    8%;

               q    =    the sum of (i) the "Flexible Cash Re-Draw Capacity",
                         being an amount equal to the difference between (1)
                         the maximum amount of Cash Re-draws that Borrowers
                         may draw under Flexible Mortgage Loans included in
                         the Trust



                                      24
<PAGE>

                         Property (whether or not drawn) as at the last
                         day of the immediately preceding Trust Calculation
                         Period and (2) the aggregate Current Balance of Cash
                         Re-draws which form part of the Trust Property as at
                         the last day of the immediately preceding Trust
                         Calculation Period; and (ii) the "Further Draw
                         Capacity", being an amount equal to the difference
                         between (1) the maximum amount of Further Draws that
                         Borrower may make under Personal Secured Loans
                         included in the Trust Property (whether or not drawn)
                         as at the last day of the immediately preceding Trust
                         Calculation Period and (2) the aggregate Current
                         Balance of Personal Secured Loans which form part of
                         the Trust Property as at the last day of the
                         immediately preceding Trust Calculation Period; and

               r    =    3; and

           Z   =    the aggregate Current Balance of (i) Re-Draws and (ii)
                    Personal Secured Loans in the Trust Property as at the
                    last day of the immediately preceding Trust Calculation
                    Period.



                                      25
<PAGE>

9.3    Recalculation of Minimum Seller Share following occurrence of
       exceptional events: The calculation of the Minimum Seller Share in
       accordance with Clause 9.2 (Fluctuation of Minimum Seller Share on each
       Distribution Date) above will be recalculated by the Cash Manager with
       the agreement of the parties hereto subject to the approval of the
       Rating Agencies if the Seller merges or otherwise combines its business
       with another bank or other financial institution so as to increase the
       risks associated with Borrowers holding deposits in Northern Rock
       accounts.

10.    Distribution of Revenue Receipts

10.1   Distribution of Third Party Amounts: Pursuant to the Cash Management
       Agreement, the Cash Manager (at the direction of the Mortgages Trustee
       acting on behalf of the Beneficiaries at their direction and with their
       consent which is hereby given) will deduct, as and when identified,
       Third Party Amounts from the Revenue Receipts standing to the credit of
       the Mortgages Trustee GIC Account or other Mortgages Trustee Bank
       Account, and pay over the same to the proper recipients thereof. The
       Mortgages Trustee and the Beneficiaries hereby consent to such
       deductions.

10.2   Distribution of Mortgages Trustee Available Revenue Receipts: Subject
       as provided in Clause 8.8 (Adjustments on Distribution Dates), on each
       Distribution Date the Cash Manager (at the direction of the Mortgages
       Trustee acting on behalf of the Beneficiaries at their direction and
       with their consent which is hereby given) will distribute Mortgages
       Trustee Available Revenue Receipts as follows:

       (a)  firstly, in no order of priority between them but in or towards
            satisfaction pro rata according to the respective amounts due of:

            (i)   any fees, costs, charges, liabilities and expenses then due
                  or to become due to the Mortgages Trustee under the
                  provisions of this Deed together with (if applicable) VAT
                  thereon (to the extent not already included) as provided
                  herein; and

            (ii)  any amounts due and payable by the Mortgages Trustee to
                  third parties in respect of the Mortgages Trust but only if
                  incurred without breach by the Mortgages Trustee of the
                  documents to which it is a party and payment has not been
                  provided for elsewhere;



                                      26
<PAGE>

       (b)  secondly, in no order of priority between them but in or towards
            satisfaction pro rata according to the respective amounts due of:

            (i)   any remuneration then due and payable to the Administrator
                  and any costs, charges, liabilities and expenses then due or
                  to become due to the Administrator under the provisions of
                  the Administration Agreement prior to the immediately
                  succeeding Distribution Date, in each case together with (if
                  applicable) VAT thereon (to the extent not already included)
                  as provided therein; and

            (ii)  any remuneration then due and payable to the Cash Manager
                  and any costs, charges, liabilities and expenses then due or
                  to become due to the Cash Manager under the provisions of
                  the Cash Management Agreement prior to the immediately
                  succeeding Distribution Date, in each case together with (if
                  applicable) VAT thereon (to the extent not already included)
                  as provided therein;

       (c)  thirdly, in no order of priority between them but in proportion to
            the respective amounts due, and subject to the proviso below, to
            allocate and pay Mortgages Trustee Available Revenue Receipts to:

            (i)   (subject as provided in Clause 8.8 (Adjustments on
                  Distribution Dates)) the Seller in an amount determined by
                  multiplying the total amount of the remaining Mortgages
                  Trustee Available Revenue Receipts by the Current Seller
                  Share Percentage of the Trust Property, as determined on the
                  immediately preceding Distribution Date or, in the case of
                  the first Distribution Date, immediately following the
                  relevant Closing Date, as of such Closing Date; and

            (ii)  (subject as provided in Clause 8.8 (Adjustments on
                  Distribution Dates)) Funding in an amount which is equal to
                  the lesser of:

                  (A)  an amount determined by multiplying the total amount of
                       the remaining Mortgages Trustee Available Revenue
                       Receipts by the Current Funding Share Percentage of the
                       Trust Property, as determined on the immediately
                       preceding Distribution Date or, in the case of the
                       first Distribution Date, the Initial Funding Share
                       Percentage); and,



                                      27
<PAGE>

                  (B)  the aggregate of the amounts to be applied on the
                       immediately succeeding Payment Date for Group 1 Issuers
                       and the immediately succeeding Payment Date for Group 2
                       Issuers as set forth under the Funding Pre-Enforcement
                       Revenue Priority of Payments or the Funding
                       Post-Enforcement Priority of Payments (but excluding
                       any principal amount due under any Intercompany Loan
                       (save that, for the avoidance of doubt, such exclusion
                       shall not apply in respect of any Funding Available
                       Revenue Receipts which are applied by an Issuer to
                       credit that Issuer's Principal Deficiency Ledger and
                       thereby reduce the principal payable under that
                       Issuer's Intercompany Loan) and any of Deferred
                       Contribution amount due under Item (P) of the Funding
                       Pre-Enforcement Revenue Priority of Payments and/or
                       Item (F) of the Funding Post-Enforcement Priority of
                       Payments), less all other amounts (not derived from the
                       distribution of Mortgages Trustee Available Revenue
                       Receipts under this Deed) which will constitute Funding
                       Available Revenue Receipts on the immediately
                       succeeding Payment Date such amount not to be less than
                       zero; and

       (d)  finally, to allocate to Funding but pay at the direction of
            Funding to the Seller an amount equal to YY - ZZ, where "YY" is
            the amount of the Mortgages Trustee Available Revenue Receipts and
            "ZZ" is the amount of such Mortgages Trustee Available Revenue
            Receipts applied and/or allocated under items (a) to (c) above,
            such amount to be in satisfaction of amounts of Deferred Purchase
            Price due to the Seller under the terms of the Mortgage Sale
            Agreement;

PROVIDED THAT if an Assignment Date or a Funding Contribution Date has
occurred during the Trust Calculation Period immediately preceding such
Distribution Date, then the Cash Manager will use (i) the Weighted Average
Seller Share Percentage (instead of the Current Seller Share Percentage) as
calculated pursuant to Clause 8.7(a) above in determining the amount of
Mortgages Trustee Available Revenue Receipts to distribute to the Seller
pursuant to Clause 10.2(c)(i) above, and (ii) the Weighted Average Funding
Share Percentage (instead of the Current Funding Share Percentage) as
calculated pursuant to Clause 8.3(a) above in determining the amount of
Mortgages Trustee Available Revenue Receipts to distribute to Funding pursuant
to Clause 10.2(c)(ii)(A) above.



                                      28
<PAGE>

11.    Distribution of Principal Receipts

11.1   Distribution of Principal Receipts prior to the occurrence of a Trigger
       Event: Subject as provided in Clause 8.8 (Adjustments on Distribution
       Dates), prior to the occurrence of a Trigger Event (and whether or not
       there has been an enforcement of the Funding Security or any Issuer
       Security), on each Distribution Date, the Cash Manager (at the
       direction of the Mortgages Trustee acting on behalf of the
       Beneficiaries at their direction and with their consent which is hereby
       given) shall, subject to the provisos below, allocate and distribute
       Mortgages Trustee Principal Receipts as follows:

       (a)  to the Seller an amount in respect of any Initial Consideration
            (if any) which is then allocable and payable to the Seller under
            Clause 6.3 (Initial Consideration) above;

       (b)  to Funding an amount in respect of each Issuer which is equal to
            the lesser of:

            (i)   the principal amount due on the Intercompany Loan of such
                  Issuer equal to the Controlled Amortisation Amounts due, if
                  any, on such Issuer's Payment Date immediately succeeding
                  such Distribution Date (in each case determined on the
                  assumption that the Issuer Reserve Requirement, the Issuer
                  Arrears Test and the Subordinated Principal Test are
                  satisfied on such date; that the Controlled Amortisation
                  Amount is the relevant amount as set forth in the tables
                  contained in Schedule 4 to the Current Issuer Cash
                  Management Agreement; and that the proviso appearing at the
                  end of such tables does not apply); and

            (ii)  an amount (not less than zero) equal to:

<TABLE>
<CAPTION>
<S>                                    <C>                                         <C>
                                       Current Funding Share Percentage as             Outstanding Principal Balance on
              Mortgages Trustee   x       calculated on the immediately       x        such Issuer's Intercompany Loan
              Principal Receipts            preceding Distribution Date            -----------------------------------------
                                                                                     Aggregate Outstanding Principal Balance
                                                                                       on all Intercompany Loans
</TABLE>

       (c)  to Funding an amount in respect of each Issuer towards any
            principal amount remaining which will be due and payable
            (following the payment to Funding set forth in (b) above) on such
            Issuer's immediately succeeding Payment Date under such Issuer's
            Intercompany Loan (in each case determined on the assumption that
            the Issuer Reserve Requirement, the Issuer Arrears Test and the
            Subordinated Principal Test are satisfied on such date; that the
            Controlled Amortisation Amount is the relevant amount as set forth
            in the tables contained in Schedule 4 to the Current Issuer



                                      29
<PAGE>

            Cash Management Agreement; and that the proviso appearing at the
            end of such tables does not apply) plus an amount equal to the
            amount which Funding will be required to apply on that Payment
            Date under item (1)(A) or (2)(A) of the Funding Pre-Enforcement
            Principal Priority of Payments (to the extent not already funded
            under (B)(1) of such priority of payments); and

       (d)  if such Distribution Date is not a Seller Share Event Distribution
            Date, all remaining Mortgages Trustee Principal Receipts to the
            Seller (as Beneficiary),

PROVIDED THAT in relation to (a) through (d) above the following rules (the
"Rules for the application of Mortgages Trustee Principal Receipts") shall
apply:

(1)    If the Notes of any Issuer have become immediately due and payable as a
       result of the service of a Note Enforcement Notice or if the
       Intercompany Loan of any Issuer (and the other Intercompany Loans of
       any other Issuers) have become immediately due and payable as a result
       of the service of an Intercompany Loan Enforcement Notice, principal
       payments in respect of the Intercompany Loan of that Issuer may be made
       in excess of any Controlled Amortisation Amount and paragraph (b)(i)
       above shall no longer apply in relation to that Issuer and, except
       following a Non-Asset Trigger Event, the amount of Mortgages Trustee
       Principal Receipts to be distributed to Funding in respect of that
       Issuer on that Distribution Date may not exceed the amount determined
       under paragraph (b)(ii) above.

(2)    If the Notes of any Issuer have become immediately due and payable as a
       result of the service of a Note Enforcement Notice or if the
       Intercompany Loan of any Issuer (and the other Intercompany Loans of
       any other Issuers) have become immediately due and payable as a result
       of the service of an Intercompany Loan Enforcement Notice, then for the
       purpose of calculating the amount in respect of that Issuer under
       paragraph (b)(ii) above, that amount may be reduced to the extent of
       any remaining amounts standing to the credit of the Issuer Reserve
       Ledger and/or the Issuer Liquidity Reserve Ledger (if any) for that
       Issuer which are to be utilised on the immediately succeeding Payment
       Date to repay principal on that Issuer's Intercompany Loan, but only to
       the extent that those amounts would not otherwise be payable on that
       Intercompany Loan on that Payment Date.

(3)    The amount of Mortgages Trustee Principal Receipts payable to Funding
       in respect of each Issuer on a Distribution Date will be reduced in
       proportion to the aggregate of the Issuer Available Revenue Receipts of
       that Issuer which are to be applied on the immediately succeeding
       Payment Date in reduction of deficiencies recorded on the Issuer
       Principal Deficiency Ledger of that Issuer, but only to the extent that
       the Issuer Available Revenue



                                      30
<PAGE>

       Receipts which are to be so applied on that Payment Date would not
       otherwise be payable as principal on the relevant Notes on that Payment
       Date.

(4)    For the purpose of determining the Mortgages Trustee Principal Receipts
       to be distributed to Funding in respect of the amount due on the
       Intercompany Loan of any Issuer under (b) and (c) above, the
       Outstanding Principal Balance of that Intercompany Loan shall be deemed
       to be reduced by the amount of:

       (a)  any deficiency recorded on the Issuer Principal Deficiency Ledger
            of that Issuer as at that Distribution Date, but only to the
            extent that such deficiency has arisen under a result of (i)
            Losses on the Mortgage Loans allocated by Funding to that Issuer
            and/or (ii) the application of Funding Available Principal
            Receipts to fund the Issuer Liquidity Reserve Fund of that Issuer
            but not as a result of any other principal deficiency of that
            Issuer; and

       (b)  the Outstanding Principal Balance as at such Distribution Date of
            any Special Repayment Notes issued by that Issuer.

(5)    Funding will not be entitled to receive and the Cash Manager shall
       procure that Funding does not receive any amount of Mortgages Trustee
       Principal Receipts from the Mortgages Trustee on a Distribution Date
       which is not required by Funding to repay principal falling due on any
       Intercompany Loan on the immediately succeeding Payment Date in order
       to fund payments of principal falling due on any Notes issued by any
       Issuer on that Payment Date.

(6)    The Mortgages Trustee will not distribute any Overpayment (other than a
       Capital Payment) in respect of any Non-Flexible Mortgage Loan until the
       first Distribution Date following December 31 of the year in which such
       Overpayment is received; provided that if a Borrower has made an
       Underpayment of principal in respect of such Non-Flexible Mortgage Loan
       following the Overpayment then the Mortgages Trustee will distribute
       principal in an amount up to the amount of such Underpayment (but not
       exceeding the amount of the Overpayment previously made) on the
       immediately succeeding Distribution Date.

(7)    If an Assignment Date or a Funding Contribution Date has occurred
       during the Trust Calculation Period immediately preceding a
       Distribution Date, then the Cash Manager shall use the Weighted Average
       Funding Share Percentage (instead of the Current Funding Share
       Percentage) as calculated pursuant to Clause 8.3(b) above in
       determining the amount of Mortgages Trustee Principal Receipts to be
       distributed to Funding in respect of each Issuer pursuant to Clause
       11.1(b)(ii) above.



                                      31
<PAGE>

(8)    On a Seller Share Event Distribution Date, the Cash Manager shall not
       distribute the remaining Mortgages Trustee Principal Receipts to the
       Seller and shall deposit all Mortgages Trustee Retained Principal
       Receipts in the Mortgages Trustee GIC Account and make a corresponding
       credit to the Mortgages Trustee Principal Ledger.

11.2   Distribution of Mortgages Trustee Principal Receipts on or after the
       occurrence of an Asset Trigger Event: On or after the occurrence of an
       Asset Trigger Event, the Cash Manager (at the direction of the
       Mortgages Trustee acting on behalf of the Beneficiaries at their
       direction and with their consent which is hereby given) shall, on each
       Distribution Date (including, if applicable, any Distribution Date on
       which an Asset Trigger Event occurs), allocate and distribute all
       Mortgages Trustee Principal Receipts as follows:

       (a)  if the immediately preceding Distribution Date was a Seller Share
            Event Distribution Date, all of the Mortgages Trustee Retained
            Principal Receipts to Funding; and then

       (b)  between Funding and the Seller, in no order of priority between
            them and pro rata according to the Funding Share Percentage of the
            Trust Property and the Seller Share Percentage of the Trust
            Property, respectively, until the Funding Share of the Trust
            Property is zero (and, for the avoidance of doubt, such payments
            may reduce the Seller Share to an amount less than the Minimum
            Seller Share),

      PROVIDED THAT if an Assignment Date or a Funding Contribution Date has
      occurred in the Trust Calculation Period immediately preceding any such
      Distribution Date, the Cash Manager will apply all Mortgages Trustee
      Principal Receipts after (a) above between Funding and the Seller pro
      rata according to the Weighted Average Funding Share Percentage (as
      calculated pursuant to Clause 8.3 above) and Weighted Average Seller
      Share Percentage (as calculated pursuant to Clause 8.7 above) for such
      Distribution Date until the Funding Share of the Trust Property is zero.

11.3   Distribution of Principal Receipts on or after the occurrence of a
       Non-Asset Trigger Event: On or after the occurrence of a Non-Asset
       Trigger Event and until the occurrence of an Asset Trigger Event, the
       Cash Manager (at the direction of the Mortgages Trustee acting on
       behalf of the Beneficiaries at their direction and with their consent
       which is hereby given) shall, on each Distribution Date (including, if
       applicable, any Distribution Date on which a Non-Asset Trigger Event
       occurs), apply all Mortgages Trustee Principal Receipts to Funding
       until the Funding Share of the Trust Property has been reduced to zero
       and shall thereafter, on each Distribution Date, apply all Mortgages
       Trustee Principal Receipts to the Seller.



                                      32
<PAGE>

12.    Allocation of Losses

12.1   Subject as provided otherwise herein (including Clause 8.4 (Adjustments
       to Trust Property) of this Deed), all Losses sustained on the Mortgage
       Loans (other than Personal Secured Loans) during a Trust Calculation
       Period shall be applied in reducing pro rata both the Funding Share and
       the Seller Share of the Trust Property on the Distribution Date
       immediately succeeding such Trust Calculation Period by multiplying the
       Losses sustained in such relevant Trust Calculation Period by the
       Current Funding Share Percentage (as calculated on the Distribution
       Date immediately preceding such Trust Calculation Period), until the
       Funding Share of the Trust Property is zero, PROVIDED THAT, if during
       the Trust Calculation Period immediately preceding a Distribution Date
       the Seller had sold and assigned New Mortgage Loans to the Mortgages
       Trustee, or if Funding paid a Further Contribution to the Mortgages
       Trustee to increase the Funding Share of the Trust Property such Losses
       shall be multiplied by the Weighted Average Funding Share Percentage
       (as calculated on such Distribution Date pursuant to Clause 8.3(c)
       above) rather than the Current Funding Share Percentage. The remainder
       of such Losses shall be allocated to the Seller.

12.2   All losses sustained during a Trust Calculation Period on Personal
       Secured Loans forming part of the Trust Property shall be applied to
       reduce the Seller Share of the Trust Property (including, for the
       avoidance of doubt, that portion of the Seller Share which represents
       the Minimum Seller Share) on the Distribution Date immediately
       succeeding such Trust Calculation Period until the Seller Share is zero
       and thereafter shall be applied to reduce the Funding Share of the
       Trust Property.

13.    Overpayments

13.1   Non-Flexible Mortgage Loans: The Mortgages Trustee shall not distribute
       to the Beneficiaries any Overpayment in respect of any Non-Flexible
       Mortgage Loan which does not constitute a Capital Payment until the
       first Distribution Date following 31st December of the year in which
       such Overpayment is received, save to the extent that any such
       Overpayment by a Borrower is applied in reduction of an Underpayment by
       such Borrower in respect of such Mortgage Loan prior to such date. Any
       such Overpayment shall be retained in the Mortgages Trustee GIC Account
       and the Cash Manager will maintain a separate ledger to record its
       receipt and subsequent payment from time to time. Where any such
       Overpayment has been made in error the Cash Manager and/or the
       Administrator will be authorised to refund the amount of such
       Overpayment to the relevant Borrower at any time prior to 31st December
       of the year in which such Overpayment was made.



                                      33
<PAGE>

13.2   Flexible Mortgage Loans: Overpayments in respect of any Flexible
       Mortgage Loan (including the amount of any Together Connections Benefit
       applied to the related Together Connections Mortgage Loans or any
       Connections Benefit applied to the related Connections Mortgage Loans)
       will not be retained in the Mortgages Trustee GIC Account but will be
       distributed to the Beneficiaries on the immediately succeeding
       Distribution Date as Principal Receipts.

14.    Arrears

       The aggregate Current Balance of the Mortgage Loans in the Mortgages
       Trust will be increased at any time by the amount in which the Mortgage
       Loans that have been sold and assigned to the Mortgages Trust are in
       arrears and those arrears have been capitalised. Such increase shall be
       allocated to the Beneficiaries at any time in proportion to their
       respective percentage shares in the Trust Property as determined in
       respect of the Trust Calculation Period or Interim Calculation Period,
       as the case may be, in which the arrears occur.

15.    Ledgers

       The Mortgages Trustee shall maintain, or shall procure that the Cash
       Manager shall maintain, the following Mortgages Trustee Ledgers:

       (a)  the Principal Ledger, which shall record (i) all receipts of
            Principal Receipts and distribution of the same to Funding and the
            Seller and (ii) any Mortgages Trustee Retained Principal Receipts;

       (b)  the Revenue Ledger, which shall record all receipts of Revenue
            Receipts and distribution of the same in accordance with this
            Deed;

       (c)  the Losses Ledger, which shall record Losses in relation to the
            Mortgage Loans;

       (d)  the Funding Share/Seller Share Ledger which shall record the
            Funding Share, the Seller Share of the Trust Property, the Funding
            Share Percentage and the Seller Share Percentage;

       (e)  the Overpayments Ledger; which shall be divided into sub ledgers
            to record (i) Overpayments on Non-Flexible Mortgage Loans received
            into and paid out of the Mortgages Trustee GIC Account from time
            to time and (ii) Overpayments on Flexible Mortgage Loans;



                                      34
<PAGE>

       (f)  the Non-Flexible Underpayments Ledger; which shall record
            Underpayments on Non-Flexible Mortgage Loans from time to time;

       (g)  the Re-Draw Ledger, which shall be divided into sub ledgers to
            record (i) Cash Re-Draws made in respect of Flexible Mortgage
            Loans and (ii) Non-Cash Re-Draws made in respect of Flexible
            Mortgage Loans;

       (h)  the Contributions Ledger, which will be divided into sub ledgers
            to record (i) the making by Funding of Contributions to the
            Mortgages Trust, (ii) the making by the Seller of Contributions to
            the Mortgages Trust and the application of such Contributions by
            the Mortgages Trustee in payment to the Seller of (a) amounts of
            Initial Purchase Price for the sale of any New Mortgage Portfolio
            which is acquired by the Mortgages Trustee from the Seller under
            the provisions of the Mortgage Sale Agreement or (b) amounts of
            Deferred Purchase Price in accordance with the Mortgage Sale
            Agreement or (c) any Initial Consideration in accordance with this
            Deed; and

       (i)  the Further Draw Ledger, which shall record all Further Draws in
            relation to Personal Secured Loans.

16.    Fees and Expenses of the Mortgages Trustee

16.1   Remuneration: The Mortgages Trustee shall be entitled to charge and be
       remunerated for the work undertaken by it as trustee of the trusts
       created by this Deed. The remuneration shall be on such terms (if any)
       as the Mortgages Trustee may from time to time agree with the
       Beneficiaries in writing.

16.2   Expenses and Liabilities: Each Beneficiary shall indemnify the
       Mortgages Trustee from time to time with such regularity as is
       reasonably agreed between the parties, in respect of the Funding Share
       and the Seller Share, respectively, of the documentable costs, expenses
       and/or liabilities directly and properly incurred by the Mortgages
       Trustee in performing its obligations hereunder or otherwise in acting
       as trustee in accordance with the terms of this Deed and the other
       Transaction Documents to which the Mortgages Trustee is a party
       inclusive (if applicable) of any amounts in respect of Irrecoverable
       VAT incurred in respect of such costs and expenses.



                                      35
<PAGE>

17.    Directions from Beneficiaries

17.1   Administration Agreement and Cash Management Agreement: On the Initial
       Closing Date the Mortgages Trustee shall enter into the Administration
       Agreement and the Cash Management Agreement.

17.2   Directions from Beneficiaries: Subject to Clause 17.3 (No Breach)
       below, the Mortgages Trustee covenants with the Beneficiaries that the
       Mortgages Trustee shall take all necessary steps and do everything
       which both Funding and the Seller (acting together) may reasonably
       request or direct it to do in order to give effect to the terms of this
       Deed or the other Transaction Documents to which the Mortgages Trustee
       is a party; provided that at any time after the Funding Share has been
       reduced to zero the Mortgages Trustee shall not be required to act at
       the direction of both Funding and the Seller (acting together) and
       shall instead act in accordance with any direction given solely by the
       Seller.

17.3   No breach: Each of Funding and the Seller covenant with each other and
       with the Mortgage Trustee that neither shall direct or request the
       Mortgages Trustee to do any act or thing which breaches the terms of,
       or is otherwise expressly dealt with (such that the Mortgages Trustee
       has no discretion) under any of the Transaction Documents.

17.4   No requirement to act: The Mortgages Trustee will not be bound and
       shall have no power to take any proceedings, actions or steps under or
       in connection with any of this Deed or the other Transaction Documents
       to which it is a party unless:

       (a)  it shall have been directed to do so by the Beneficiaries or it is
            required to do so under any express provision of this Deed or the
            other Transaction Documents (but subject to Clause 17.2
            (Directions from Beneficiaries) in respect of conflict of
            directions); and

       (b)  it shall have been indemnified to its satisfaction against all
            liabilities, proceedings, claims and demands to which it may be or
            become liable and all costs, charges and expenses which may be
            incurred by it in connection therewith and the terms of such
            indemnity may include the provision of a fighting fund,
            non-recourse loan or other similar arrangement.

17.5   Covenant of the Mortgages Trustee: Subject to Clause 17.2 (Directions
       from Beneficiaries) the Mortgages Trustee covenants with each of the
       Seller and Funding to exercise all of its rights arising under or in
       respect of the Trust Property (including without limitation any rights
       of enforcement) for the benefit of and on behalf of the Beneficiaries.



                                      36
<PAGE>

18.    Early Termination of the Mortgages Trust

       Prior to its termination in accordance with Clause 26 (Termination),
       provided that all amounts due from Funding to the Funding Secured
       Creditors have been repaid in full, the Mortgages Trust constituted by
       this Deed may be terminated at the option of the Seller, following a
       request in writing by the Seller to the Mortgages Trustee (which shall
       be copied to Funding and the Cash Manager) at any time on or after the
       date on which all of the Intercompany Loans have been repaid in full or
       there is no further claim under any Intercompany Loan and the Funding
       Share of the Trust Property has been reduced to zero or such other date
       as may be agreed in writing between the Mortgages Trustee, Funding and
       the Seller.

19.    Audit of Mortgage Loans constituting the Trust Property

       If the long term, unsecured, unguaranteed and unsubordinated debt
       obligations of the Seller fall below A3 by Moody's then, if required by
       Moody's, the Beneficiaries shall appoint a firm of independent auditors
       (approved by the Rating Agencies) to determine whether the Mortgage
       Loans and their Related Security (or any part of them) constituting the
       Trust Property complied with the representations and warranties set out
       in Schedule 1 (Representations and Warranties) of the Mortgage Sale
       Agreement as at the date such Mortgage Loans were sold and assigned to
       the Mortgages Trustee. The costs of such independent auditors shall be
       borne by the Beneficiaries pro rata according to their respective
       current percentage shares in the Trust Property.

20.    Transfers

20.1   Funding shall not assign: Subject to the right of Funding to assign by
       way of security its right, title, benefit and interest in the Trust
       Property and/or under this Deed to the Security Trustee under the
       Funding Deed of Charge and subject to the right of the Security Trustee
       or a Receiver to sell the Funding Share of the Trust Property and/or
       such right and interest under this Deed following the service of an
       Intercompany Loan Enforcement Notice (which right is hereby conferred),
       Funding covenants with the Seller that it shall not, and shall not
       purport to, sell, assign, transfer, convey, charge, declare a trust
       over, create any beneficial interest in, or otherwise dispose of the
       Funding Share in the Trust Property, or any of Funding's rights, title,
       interest or benefit in any of the Mortgage Portfolio or the Trust
       Property.

20.2   Seller shall not assign: The Seller covenants with Funding that it
       shall not, and shall not purport to, sell, assign, transfer, convey,
       charge, declare a trust over, create any beneficial interest in, or
       otherwise dispose of the Seller Share in the Trust Property or any of
       the Seller's



                                      37
<PAGE>

       rights, title, interest or benefit in the Trust Property, other than
       pursuant to the Transaction Documents.

21.    Representations and Covenants

21.1   Representations: On the date hereof, each of the parties to this Deed
       makes the representations and warranties set out in Schedule 1
       (Representation and Warranties) to this Deed to each of the other
       parties hereto.

21.2   Covenants of the Mortgages Trustee: Save with the prior written consent
       of or at the direction of the Beneficiaries or as provided in or
       envisaged by this Deed and/or the other Transaction Documents, the
       Mortgages Trustee shall not, so long as it is acting as Mortgages
       Trustee hereunder:

       (a)  Negative Pledge: create or permit to subsist any mortgage,
            standard security, pledge, lien, charge or other security interest
            whatsoever (unless arising by operation of law), upon the whole or
            any part of its assets (including any uncalled capital) or its
            undertakings (present or future) or (to the extent that it is
            within the control of the Mortgages Trustee) upon the whole or any
            part of the Trust Property;

       (b)  Disposal: transfer, sell, lend, part with or otherwise dispose of,
            or deal with, or grant any option or present or future right to
            acquire any of its assets or undertakings or (to the extent that
            it is within the control of the Mortgages Trustee) the Trust
            Property or any interest, estate, right, title or benefit therein
            or thereto or agree or attempt or purport to do so;

       (c)  Equitable Interest: knowingly permit any person other than the
            Beneficiaries to have any equitable or beneficial interest in any
            of its assets or undertakings or (to the extent that it is within
            the control of the Mortgages Trustee) the Trust Property or any
            interest, estate, right, title or benefit therein;

       (d)  Bank Accounts: have an interest in any bank account, other than as
            set out in the Transaction Documents.

       (e)  Restrictions on Activities: carry on any business other than as
            described in this Deed and the Transaction Documents;

       (f)  Borrowings: incur any indebtedness in respect of borrowed money
            whatsoever or give any guarantee or indemnity in respect of any
            such indebtedness;



                                      38
<PAGE>

       (g)  Merger: consolidate or merge with any other person or convey or
            transfer its properties or assets substantially or as an entirety
            to any other person;

       (h)  Premises or Employees: have any premises or employees or
            subsidiaries; or

       (i)  Further shares: issue any further shares;

       (j)  United States activities: engage in any activities in the United
            States (directly or through agents) or derive any income from
            United States sources as determined under United States income tax
            principles or hold any property if doing so would cause it to be
            engaged or deemed to be engaged in a trade or business within the
            United States as determined under United States tax principles;

       (k)  Conduct of affairs: take any management decisions or direct the
            conduct of its affairs in any Member State of the European Union,
            including holding any board meetings in any Member State of the
            European Union.

22.    Power to Delegate

22.1   Power to delegate: Subject to Clause 22.2 (No further appointments),
       the Mortgages Trustee may (notwithstanding any rule of law or equity to
       the contrary) delegate (revocably or irrevocably and for a limited or
       unlimited period of time) the performance of all or any of its
       obligations and the exercise of all or any of its powers under this
       Deed or imposed or conferred on it by law or otherwise to any person or
       body of persons fluctuating in number selected by it and any such
       delegation may be by power of attorney or in such other manner as the
       Mortgages Trustee may think fit and may be made upon such terms and
       conditions (including the power to sub-delegate) as the Mortgages
       Trustee may think fit.

22.2   No further appointments: Notwithstanding the provisions of Clause 22.1
       (Power to delegate), the Mortgages Trustee shall not appoint any agent,
       attorney or other delegate having power to act in respect of the Trust
       Property unless it is directed in writing to do so by the
       Beneficiaries. The appointment of any agent, attorney or other delegate
       hereunder above shall terminate immediately upon the occurrence of a
       Trigger Event.

23.    Powers of Investment

       The Mortgages Trustee may invest, and may appoint the Cash Manager to
       invest on its behalf, any amounts standing to the credit of the
       Mortgages Trustee Transaction Account in Authorised Investments. Save
       as expressly provided in this Deed, the Mortgages Trustee



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<PAGE>

       Guaranteed Investment Contract and the Bank Account Agreement, the
       Mortgages Trustee shall have no further or other powers of investment
       with respect to the Trust Property and (to the extent permitted by
       applicable law) the Trustee Act 2000 shall not nor shall any other
       provision relating to trustee powers of investment implied by statute
       or general law shall apply to the Mortgages Trust.

24.    Other Provisions regarding the Mortgages Trustee

24.1   No action to impair Trust Property: Except for actions expressly
       authorised by this Deed, the Mortgages Trustee shall take no action
       reasonably likely to impair the interests of the Beneficiaries in any
       Trust Property now existing or hereafter created or to impair the value
       of any Mortgage Loan or its Related Security subject to the Mortgages
       Trust.

24.2   Litigation: The Mortgages Trustee must not prosecute or defend any
       legal or other proceedings anywhere in the world (at the cost of the
       Trust Property) unless it obtains legal or other advice that it is in
       the interests of the Beneficiaries to do so.

24.3   No Implied Duties: The duties and obligations of the Mortgages Trustee
       under the Mortgages Trust shall be determined solely by the express
       provisions of this Deed (but without prejudice to the duties and
       obligations of the Mortgages Trustee under any of the other Transaction
       Documents). The Mortgages Trustee shall not be liable under this Deed
       except for the performance of such duties and obligations as shall be
       specifically set forth in this Deed. No implied covenants or
       obligations shall be read into this Deed against the Mortgages Trustee,
       and the permissible right of the Mortgages Trustee to do things set out
       in this Deed shall not be construed as a duty.

24.4   No Liability: Neither the Mortgages Trustee, Funding (in its capacity
       as a Beneficiary hereunder) nor the Seller (in its capacity as a
       Beneficiary hereunder) shall be liable to each other, in the absence of
       wilful default, gross negligence or breach of the terms of this Deed,
       in respect of any loss or damage which arises out of the exercise or
       attempted or purported exercise or failure to exercise any of their
       respective powers.

24.5   Reliance on Certificates: The Mortgages Trustee may rely on and shall
       be protected in acting on, or in refraining from acting in accordance
       with, any resolution, officer's certificate, certificate of auditors or
       any other certificate, statement, instrument, opinion, report, notice,
       request, consent, order, appraisal, bond or other paper or document
       believed by it to be genuine and to have been signed or presented to it
       pursuant to the Transaction Documents by the proper party or parties.



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<PAGE>

24.6   Reliance on Third Parties: The Mortgages Trustee may, in relation to
       these presents, act on the opinion or advice of or a certificate or any
       information obtained from any lawyer, banker, valuer, broker,
       accountant, financial adviser, securities dealer, merchant bank,
       computer consultant or other expert in the United Kingdom or elsewhere
       and shall not, provided that it shall not have acted fraudulently or in
       breach of any of the provisions of the Transaction Documents, be
       responsible for any loss occasioned by so acting. Any such opinion,
       advice, certificate or information may be sent or obtained by letter,
       telemessage, telex, cable or facsimile device and the Mortgages Trustee
       shall not be liable for acting on any opinion, advice, certificate or
       information purporting to be so conveyed although the same shall
       contain some error or shall not be authentic, provided that such error
       or lack of authenticity shall not be manifest.

24.7   MIG Policies: The Mortgages Trustee is not required to maintain any MIG
       Policy with the then-current insurer and may contract for mortgage
       indemnity guarantee protection from any insurer then providing MIG
       insurance policies, subject to prior agreement with the Rating Agencies
       and confirmation that the then-current ratings by the Rating Agencies
       (or any of them) of the Notes issued by any Issuer would not be
       adversely affected.

25.    No retirement of Mortgages Trustee

25.1   No Retirement: The Mortgages Trustee shall not, and shall not purport
       to, retire as the trustee of the Mortgages Trust or appoint any
       additional trustee of the Mortgages Trust and shall have no power to
       retire or appoint any additional trustee under the Trustee Act 1925 or
       otherwise.

25.2   No Replacement: Neither the Seller nor Funding shall at any time remove
       or purport to remove and/or replace the Mortgages Trustee as the
       trustee of the Mortgages Trust.

25.3   No Termination: Prior to the payment by Funding of all amounts owing
       under the Intercompany Loan Agreements and under the Transaction
       Documents, neither the Seller nor Funding shall at any time, except in
       accordance with the provisions of Clause 18 (Early Termination of the
       Mortgages Trust) and Clause 26 (Termination), terminate or purport to
       terminate the Mortgages Trust and, in particular, but without prejudice
       to the generality of the foregoing, the Seller and Funding shall not in
       reliance on their absolute beneficial interests in the Trust Property
       call for the transfer to them or vesting in them of the legal estate in
       all or any part of the Trust Property.



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<PAGE>

26.    Termination

       Subject to Clause 18 (Early Termination of the Mortgages Trust), the
       Mortgages Trust hereby constituted shall terminate upon the date upon
       which the Trust Property is zero.

27.    Further Assurances

       The parties agree that they will co-operate fully to do all such
       further acts and things and execute any further documents as may be
       necessary or desirable to give full effect to the arrangements
       contemplated by this Deed.

28.    No Partnership or Agency

       Nothing in this Deed shall be taken to constitute or create a
       partnership between any of the parties to this Deed or to make or
       appoint the Seller the agent of Funding (or vice versa).

29.    Calculations

       In the absence of manifest error, any determination or calculation by
       or on behalf of the Mortgages Trustee in connection with the provisions
       of this Deed shall be deemed to be conclusive.

30.    Confidentiality

30.1   General Obligation of Confidentiality: Unless otherwise required by
       applicable law, and subject to Clause 30.2 (Exceptions) below, each of
       the parties agrees to maintain the confidentiality of this Deed in its
       communications with third parties and otherwise. None of the parties
       shall disclose to any person any information relating to the business,
       finances or other matters of a confidential nature of or relating to
       any other party to this Deed or any of the Transaction Documents which
       it may have obtained as a result of having entered into this Deed or
       otherwise.

30.2   Exceptions: The provisions of Clause 30.1 (General Obligation of
       Confidentiality) above shall not apply:

       (a)  to the disclosure of any information to any person who is a party
            to any of the Transaction Documents as expressly permitted by the
            Transaction Documents;

       (b)  to the disclosure of any information which is or becomes public
            knowledge otherwise than as a result of the wrongful conduct of
            the recipient;



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<PAGE>

       (c)  to the extent that the recipient is required to disclose the same
            pursuant to any law or order of any court or pursuant to any
            direction or requirement (whether or not having the force of law)
            of any central bank or any governmental or other regulatory or
            Taxation authority;

       (d)  to the disclosure of any information to professional advisers who
            receive the same under a duty of confidentiality;

       (e)  to the disclosure of any information with the consent of the
            parties hereto;

       (f)  to the disclosure to the Rating Agencies or any of them of such
            information as may be requested by any of them for the purposes of
            setting or reviewing the rating assigned to the Notes (or any of
            them), provided that no information which would disclose the
            identity of a Borrower shall be disclosed to the Rating Agencies
            or any of them;

       (g)  to the disclosure of any information disclosed to a prospective
            assignee of Funding (provided that it is disclosed on the basis
            that the recipient will hold it confidential); or

       (h)  to any disclosure for the purposes of collecting in or enforcing
            the Trust Property or any of it.

31.    Perpetuity Period

       The perpetuity period for the purposes of this Mortgages Trust Deed
       shall be the period of 80 years commencing on the date hereof.

32.    Non Petition Covenant; Limited Recourse

32.1   Non Petition Covenant: Each of the parties hereto hereby agrees that it
       shall not institute against either Funding or the Mortgages Trustee any
       winding-up, administration, insolvency or similar proceedings 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.

32.2   Limited Recourse: Each of the parties hereto agrees that:

       (a)  in relation to the Mortgages Trustee, any amount payable by the
            Mortgages Trustee to any other party to this Deed under this Deed
            not being an amount payable out of the Trust Property in
            accordance with the terms of this Deed shall only be payable to
            the



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<PAGE>

            extent that on that date the Mortgages Trustee has sufficient funds
            to pay such amount out of fees paid to it under this Deed; and

       (b)  in relation to Funding:

            (i)    only the Security Trustee may enforce the security created
                   in favour of the Security Trustee under the Funding Deed of
                   Charge in accordance with the provisions thereof;

            (ii)   notwithstanding any other provision of this Deed or any
                   other Transaction Document, no sum due or owing to any
                   party to this Deed from or by Funding under this Deed shall
                   be payable by Funding except to the extent that Funding has
                   sufficient funds available or (following enforcement of the
                   Funding Security) the Security Trustee has realised
                   sufficient funds from the Funding Security to pay such sum
                   subject to and in accordance with the relevant Funding
                   Priority of Payments and provided that all liabilities of
                   Funding required to be paid in priority thereto or pari
                   passu therewith pursuant to such Funding Priority of
                   Payments have been paid, discharged and/or otherwise
                   provided for in full; and

            (iii)  it shall not take any steps for the purpose of recovering
                   any amount payable by Funding or enforcing any rights
                   arising out of this Deed against Funding otherwise than in
                   accordance with the Funding Deed of Charge.

32.3   Corporate Obligations: To the extent permitted by law, no recourse
       under any obligation, covenant, or agreement of any person contained in
       this Deed shall be had against any shareholder, officer or director of
       such person as such, by the enforcement of any assessment or by any
       legal proceeding, by virtue of any statute or otherwise; it being
       expressly agreed and understood that this Deed is a corporate
       obligation of each person expressed to be a party hereto and no
       personal liability shall attach to or be incurred by the shareholders,
       officers, agents or directors of such person as such, or any of them,
       under or by reason of any of the obligations, covenants or agreements
       of such person contained in this Deed, or implied therefrom, and that
       any and all personal liability for breaches by such person of any of
       such obligations, covenants or agreements, either under any applicable
       law or by statute or constitution, of every such shareholder, officer,
       agent or director is hereby expressly waived by each person expressed
       to be a party hereto as a condition of and consideration for the
       execution of this Deed.



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<PAGE>

33.    Amendments and Waiver

33.1   Entire Agreement: This Deed sets out the entire agreement and
       understanding between the parties with respect to the subject matter of
       this Deed superseding all prior oral or written understandings other
       than the other Transaction Documents.

33.2   Amendments and Waiver: No amendment or waiver of any provision of this
       Deed nor consent to any departure by any of the parties therefrom shall
       in any event be effective unless the same shall be in writing and
       signed by each of the parties hereto. In the case of a waiver or
       consent, such waiver or consent shall be effective only in the specific
       instance and as against the party or parties giving it for the specific
       purpose for which it is given.

33.3   Rights cumulative: The respective rights of each of the parties to this
       Deed are cumulative and may be exercised as often as they consider
       appropriate. No failure on the part of any party to exercise, and no
       delay in exercising, any right hereunder shall operate as a waiver
       thereof, nor shall any single or partial exercise of any such right
       preclude any other or further exercise thereof or the exercise of any
       other right. The remedies in this Deed are cumulative and not exclusive
       of any remedies provided by law.

34.    Notices

       Any notices or other communication or document to be given or delivered
       pursuant to this Deed to any of the parties hereto shall be
       sufficiently served if sent by prepaid first class post, by hand or by
       facsimile transmission and shall be deemed to be given (in the case of
       facsimile transmission) when despatched or (where delivered by hand) on
       the day of delivery if delivered before 17.00 hours on a London
       Business Day or on the next London 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 the Seller, to Northern Rock plc, Northern Rock
            House, Gosforth, Newcastle upon Tyne NE3 4PL (facsimile number
            0191 213 2203) for the attention of the Group Secretary;

       (b)  in the case of the Mortgages Trustee, to Granite Finance Trustees
            Limited, 22 Grenville Street, St. Helier, Jersey JE4 8PX, Channel
            Islands (facsimile number 01534-609333) for the attention of the
            Company Secretary (with a copy to the Seller in accordance with
            (a) above);



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<PAGE>

       (c)  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 the
            Seller in accordance with (a) above);

       (d)  in the case of the Security Trustee, to The Bank of New York, 48th
            Floor, One Canada Square, London E14 5AL (facsimile number 020
            7964 6399) for the attention of the Global Structured Finance
            (Corporate Trust);

       (e)  in the case of the Fitch Ratings Ltd, to Fitch Ratings Ltd, Eldon
            House, 2 Eldon Street, London EC2M 7UA (facsimile number 020 7417
            6262) for the attention of European Structured Finance
            Surveillance;

       (f)  in the case of Moody's, to Moody's, 1st Floor, 2 Minster Court,
            Mincing Lane, London EC3R 7XB (facsimile number 020 7772 5400) for
            the attention of Head of Monitoring Group, Structured Finance
            (with a copy to the Seller in accordance with (a) above);

       (g)  in the case of Standard & Poor's, to Standard & Poor's, Garden
            House, 18 Finsbury Circus, London EC2M 7NJ (facsimile number 020
            7826 3598) for the attention of Structured Finance Surveillance
            Group (with a copy to the Seller in accordance with (a) above),

       or to such other address or facsimile number or for the attention of
       such other person or entity as may from time to time be notified by any
       party to the others by fifteen days prior written notice in accordance
       with the provisions of this Clause 34.

35.    Third Party Rights

       A person who is not a party to this Deed 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.

36.    Execution in Counterparts; Severability

36.1   Counterparts: This Deed 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.

36.2   Severability: Where any provision in or obligation under this Deed
       shall be invalid, illegal or



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<PAGE>

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

37.    Governing Law and Submission to Jurisdiction

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

37.2   Submission to Jurisdiction: Each of the parties hereto irrevocably
       agrees that the courts of England shall have jurisdiction to hear and
       determine any suit, action or proceeding, and to settle any disputes,
       which may arise out of or in connection with this Deed and, for such
       purposes, irrevocably submits to the jurisdiction of such courts.

37.3   Process Agent: The Mortgages Trustee irrevocably and unconditionally
       appoints Mourant & Co. Capital (SPV) Limited at 4 Royal Mint Court,
       London EC3N 4HJ or otherwise at its registered office 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.

37.4   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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<PAGE>

                                  SCHEDULE 1

                        REPRESENTATIONS AND WARRANTIES

1.     Status: It is duly incorporated 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 each of the
       Transaction Documents to which it is or will be a party, and each such
       Transaction Document has been duly executed and delivered by it.

3.     Legal validity: Each Transaction Document to which it is or will be a
       party 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 each of the Transaction Documents
       to which it is a party and the exercise by it of its rights and the
       performance of its obligations under such Transaction Documents will
       not:

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

       (b)  conflict with its constitutional documents; or

       (c)  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, and the transactions
       contemplated by, the Transaction Documents have been obtained or
       effected (as appropriate) and are in full force and effect.



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