Exhibit
      10.5


     

    RWT
      HOLDINGS, INC.

    Owner

     

    MORGAN
      STANLEY CREDIT CORPORATION

    Servicer

     

    and

     

    REDWOOD
      TRUST, INC.

    Guarantor

     

      
        

      

    

     

    MASTER
      SERVICING AGREEMENT

     

    Dated
      as of November 1, 2006

     

    Fixed,
      Adjustable Rate and Additional Collateral Mortgage Loans

    Flow
      Delivery Program

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    TABLE
      OF CONTENTS

     

    
      	 	 	
              Page

            
	
              ARTICLE
                I DEFINITIONS

            	 	
              1

            
	
              Section
                1.01 Defined Terms.

            	 	
              1

            
	 	 	 
	
              ARTICLE
                II BOOKS AND RECORDS; TRANSFER OF MORTGAGE LOANS

            	 	
              6

            
	
              Section
                2.01 Books and Records.

            	 	
              6

            
	
              Section
                2.02 Transfer of Mortgage Loans.

            	 	
              6

            
	 	 	 
	
              ARTICLE
                III REPRESENTATIONS AND WARRANTIES OF THE SERVICER

            	 	
              7

            
	
              Section
                3.01 Representations and Warranties of the Servicer.

            	 	
              7

            
	 	 	 
	
              ARTICLE
                IV ADMINISTRATION AND SERVICING OF MORTGAGE LOANS

            	 	
              8

            
	
              Section
                4.01 Role of the Servicer.

            	 	
              8

            
	
              Section
                4.02 Collection of Mortgage Loan Payments.

            	 	
              9

            
	
              Section
                4.03 Realization Upon Defaulted Mortgage Loans.

            	 	
              10

            
	
              Section
                4.04 Establishment of Custodial Accounts; Deposits in Custodial
                Accounts.

            	 	
              10

            
	
              Section
                4.05 Permitted Withdrawals From the Custodial Account.

            	 	
              11

            
	
              Section
                4.06 Establishment of Escrow Accounts; Deposits in Escrow
                Accounts.

            	 	
              12

            
	
              Section
                4.07 Permitted Withdrawals From Escrow Account.

            	 	
              13

            
	
              Section
                4.08 Transfer of Accounts.

            	 	
              13

            
	
              Section
                4.09 [INTENTIONALLY OMITTED]

            	 	
              13

            
	
              Section
                4.10 Errors and Omissions Insurance.

            	 	
              13

            
	
              Section
                4.11 Title Management and Disposition of REO Property.

            	 	
              14

            
	
              Section
                4.12 Adjustments to Mortgage Interest Rates.

            	 	
              15

            
	
              Section
                4.13 Subservicing Agreements Between the Servicer and
                Subservicers.

            	 	
              15

            
	
              Section
                4.14 Successor Subservicers.

            	 	
              16

            
	
              Section
                4.15 Liability of the Servicer.

            	 	
              16

            
	
              Section
                4.16 Assumption or Termination of Subservicing Agreements.

            	 	
              16

            
	
              Section
                4.17 Servicing Accounts.

            	 	
              17

            
	
              Section
                4.18 Permitted Investments.

            	 	
              17

            
	
              Section
                4.19 Payment of Taxes, Insurance and Other Charges; Maintenance of
                Primary
                Mortgage Insurance Policies; Collections Thereunder.

            	 	
              17

            
	
              Section
                4.20 Maintenance of Hazard Insurance.

            	 	
              18

            
	 	 	 
	
              ARTICLE
                V ADMINISTRATION AND SERVICING OF TRADING ACCOUNTS

            	 	
              19

            
	
              Section
                5.01 The Servicer to Service Trading Accounts.

            	 	
              19

            
	
              Section
                5.02 Agreements with Respect to the Surety Bond.

            	 	
              20

            
	 	 	 
	
              ARTICLE
                VI PAYMENTS TO OWNER

            	 	
              21

            
	
              Section
                6.01 Distributions.

            	 	
              21

            
	
              Section
                6.02 Statements to Owner.

            	 	
              21

            
	
              Section
                6.03 Monthly Advances by the Servicer.

            	 	
              21

            
	
              Section
                6.04 Compensating Interest.

            	 	
              22

            


    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      	
              ARTICLE
                VII GENERAL SERVICING PROCEDURE

            	 	
              23

            
	
              Section
                7.01 Assumption Agreements.

            	 	
              23

            
	
              Section
                7.02 Satisfaction of Mortgages and Release of Mortgage
                Files.

            	 	
              23

            
	
              Section
                7.03 Servicing Compensation.

            	 	
              23

            
	
              Section
                7.04 Annual Statement as to Compliance and Attestation.

            	 	
              24

            
	
              Section
                7.05 Owner’s Right to Examine the Servicer Records .

            	 	
              24

            
	 	 	 
	
              ARTICLE
                VIII REPORTS TO BE PREPARED BY SERVICER

            	 	
              25

            
	
              Section
                8.01 The Servicer Shall Provide Information as Reasonably Required
                .

            	 	
              25

            
	 	 	 
	
              ARTICLE
                IX THE SERVICER

            	 	
              25

            
	
              Section
                9.01 Indemnification; Third Party Claims.

            	 	
              25

            
	
              Section
                9.02 Merger or Consolidation of the Servicer .

            	 	
              26

            
	
              Section
                9.03 Limitation on Liability of the Servicer and Others.

            	 	
              26

            
	
              Section
                9.04 The Servicer Not to Resign.

            	 	
              26

            
	 	 	 
	
              ARTICLE
                X DEFAULT

            	 	
              27

            
	
              Section
                10.01 Events of Default .

            	 	
              27

            
	
              Section
                10.02 Waiver of Defaults .

            	 	
              28

            
	 	 	 
	
              ARTICLE
                XI TERMINATION; REPURCHASE

            	 	
              28

            
	
              Section
                11.01 Termination .

            	 	
              28

            
	
              Section
                11.02 Repurchase.

            	 	
              29

            
	 	 	 
	
              ARTICLE
                XII MISCELLANEOUS PROVISIONS

            	 	
              29

            
	
              Section
                12.01 Successor to the Servicer.

            	 	
              29

            
	
              Section
                12.02 Amendment.

            	 	
              30

            
	
              Section
                12.03 Assignments.

            	 	
              30

            
	
              Section
                12.04 Assignment of Servicing Rights .

            	 	
              30

            
	
              Section
                12.05 Governing Law.

            	 	
              30

            
	
              Section
                12.06 Notices.

            	 	
              30

            
	
              Section
                12.07 Severability Provisions.

            	 	
              31

            
	
              Section
                12.08 Exhibits.

            	 	
              31

            
	
              Section
                12.09 General Interpretive Principles.

            	 	
              31

            
	
              Section
                12.10 Reproduction of Documents .

            	 	
              32

            
	
              Section
                12.11 Successors and Assigns.

            	 	
              32

            
	
              Section
                12.12 Counterparts.

            	 	
              32

            
	
              Section
                12.13 Non-Solicitation .

            	 	
              32

            
	
              Section
                12.14 Guaranty of Owner’s Obligations.

            	 	
              33

            
	 	 	 
	
              ARTICLE
                XIII COMPLIANCE WITH REGULATION AB

            	 	
              33

            
	
              Section
                13.01 Intent of the Parties; Reasonableness.

            	 	
              33

            
	
              Section
                13.02 Additional Representations and Warranties of the
                Servicer.

            	 	
              33

            
	
              Section
                13.03 Information to Be Provided by the Servicer.

            	 	
              34

            
	
              Section
                13.04 Annual Statements as to Compliance.

            	 	
              37

            
	
              Section
                13.05 Report on Assessment of Compliance and Attestation.

            	 	
              38

            
	
              Section
                13.06 Use of Subservicers and Subcontractors.

            	 	
              39

            
	
              Section
                13.07 Indemnification; Remedies.

            	 	
              40

            
	
              Section
                13.08 Third Party Beneficiary.

            	 	
              42

            


    

    


    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

    

    


    EXHIBIT
      A

    FORM
      OF
      LIMITED POWER OF ATTORNEY

    


    EXHIBIT
      B

    FORM
      OF
      MONTHLY SERVICER REPORT

    


    EXHIBIT
      C

    SERVICING
      CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

    


    EXHIBIT
      D

    FORM
      OF
      ANNUAL CERTIFICATION

     

    
      
        
        

      

      
        iii

        
          

        

      

      
        
        

      

    

     

    MORTGAGE
      LOAN SERVICING AGREEMENT

     

    This
      is a
      MASTER SERVICING AGREEMENT (this “AGREEMENT”), dated and effective as of
      November 1, 2006 and is by and between RWT Holdings, Inc., a Delaware
      Corporation, as owner (“Owner”), Morgan Stanley Credit Corporation, a Delaware
      corporation, as servicer (the “Servicer”), and Redwood Trust, Inc., a Maryland
      corporation, as guarantor (“Guarantor”).

     

    PRELIMINARY
      STATEMENTS

     

    Pursuant
      to a Master Mortgage Loan Purchase Agreement dated as of November 1, 2006
      between Owner, Morgan Stanley Credit Corporation, a Delaware corporation
      (“Seller”) and Guarantor (as amended, modified restated or supplemented from
      time to time, the “Purchase Agreement”), Owner may purchase from Seller from
      time to time certain residential, first mortgage loans. In order to facilitate
      the servicing of such mortgage loans by the Servicer, the Servicer, Owner and
      Guarantor have executed this agreement.

     

    In
      consideration of the premises and the mutual agreements hereinafter set forth,
      Owner and the Servicer agree as follows:

     

    ARTICLE
      I

     

    DEFINITIONS

     

    Section
      1.01 Defined
      Terms.

     

    Whenever
      used in this Agreement, the following words and phrases, unless the context
      otherwise requires shall have the following meaning specified in this Section
      (capitalized terms used and not otherwise defined herein shall have the
      respective meanings specified in the Purchase Agreement to the extent the same
      are defined therein):

     

    “Agreement”:
      This Master Servicing Agreement and all exhibits hereto, as the same may from
      time to time be amended, modified, restated or supplemented.

     

    “Applicable
      Law”: All applicable laws of any Governmental Authority, including, without
      limitation, federal, state and foreign securities laws, tax laws, tariff and
      trade laws, ordinances, judgments, decrees, injunctions, writs and orders or
      like actions of any Governmental Authority and rules, regulations, orders,
      interpretations, licenses, and permits of any federal, regional, state, county,
      municipal or other Governmental Authority.

     

    “Collateral
      Base”: With respect to any Mortgage Loan, the value of any Additional Collateral
      related to such Mortgage Loan, plus the value of the Mortgaged Property related
      to such Mortgage Loan.

     

    “Condemnation
      Proceeds”: All awards or settlements in respect of a taking of a partial or an
      entire Mortgaged Property by exercise of the power of eminent domain or
      condemnation.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    “Custodial
      Account”: The separate trust account or accounts created and maintained pursuant
      to Section
      4.04
      of this
      Agreement which shall be entitled “Morgan Stanley Credit Corporation, in trust
      for RWT Holdings, Inc.,” or such other title as is requested by the
      Owner.

     

    “Eligible
      Account”: An account that is (i) maintained at a depository institution the
      short-term debt obligations (or, in the case of a depository institution which
      is part of a holding company structure, the short-term debt obligations of
      such
      parent holding company) of which have been rated by each Rating Agency in one
      of
      its two highest short-term rating categories at the time of the deposit therein,
      or (ii) a trust account maintained with a corporate trust department of a
      federal or state chartered depository institution or trust company, which
      institution is acting in its fiduciary capacity.

     

    “Escrow
      Account”: The separate trust account or accounts created and maintained pursuant
      to Section
      4.06
      on which
      shall be entitled “Morgan Stanley Credit Corporation, as Servicer, in trust for
      Owner and various Mortgagors,” or such other title as is requested by
      Owner.

     

    “Escrow
      Payments”: The amounts constituting ground rents, taxes, assessments, water
      charges, sewer rents, mortgage insurance premiums, property insurance premiums
      and other payments required to be escrowed by the Mortgagor with the mortgagee
      pursuant to any Mortgage Loan.

     

    “Event
      of
      Default”: Any one of the conditions or circumstances enumerated in Section
      10.01.

     

    “Governmental
      Authority”: Any nation or government (including any state or other political
      subdivision of either thereof) and any entity exercising executive, legislative,
      judicial, regulatory or administrative functions of or pertaining to
      government.

     

    “Insurance
      Proceeds”: Proceeds of any Primary Mortgage Insurance Policy, title policy,
      hazard policy or other insurance policy covering a Mortgage Loan, if any, to
      the
      extent such proceeds are not to be applied to the restoration of the related
      Mortgaged Property or released to the Mortgagor in accordance with the
      procedures that the Servicer would follow in servicing mortgage loans held
      for
      its own account.

     

    “Liquidation
      Proceeds”: Amounts, other than Insurance Proceeds and Condemnation Proceeds,
      received by the Servicer in connection with the liquidation of a defaulted
      Mortgage Loan through a trustee’s sale, foreclosure sale or otherwise
      (including, but not limited to, amounts received with respect to an Additional
      Collateral Pledge Agreement), other than amounts received following the
      acquisition of REO Property pursuant to Section
      4.11.

     

    “Loan
      Amount”: With respect to any Mortgage Loan at any time, the outstanding
      principal balance of such Mortgage Loan at such time.

     

    “Loan
      Documents”: With respect to any Mortgage Loan, the Mortgage Note, Mortgage,
      and/or any other documents executed by Mortgagor and delivered to the Servicer
      evidencing or securing the Mortgage Loan.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Master
      Servicer”: With respect to any Securitization Transaction, the “Master
      Servicer,” if any, identified in the related transaction documents.

     

    “Monthly
      Advance”: The aggregate of the advances made by the Servicer on any Remittance
      Date pursuant to Section
      6.03.

     

    “Moody’s”:
      Moody’s Investors Service, Inc. or its successor in interest.

     

    “Mortgage
      Loan”: The “Mortgage Loans” (as defined in the Purchase Agreement) which are
      subject to this Agreement from time to time.

     

    “MSA
      Mortgage Loan Schedule”: Collectively, a schedule comprised of all Mortgage
      Loans subject to servicing under this Agreement, but excluding all Mortgage
      Loans assumed or transferred by Owner, or otherwise no longer subject to
      servicing under this Agreement.

     

    “MSCC”:
      As defined in Section 4.16.

     

    “Officer’s
      Certificate”: A certificate signed by the Chairman of the Board, the Vice
      Chairman of the Board, the President, a Senior Vice President, Vice President,
      or an Assistant Vice President of the Servicer, and delivered to Owner as
      required by this Agreement.

     

    “Owner”:
      The owner of the Mortgage Loans.

     

    “Permitted
      Investment”: Any one or more of the following:

     

    
      	 	
              (i)

            	
              direct
                obligations of, or obligations fully guaranteed as to principal and
                interest by, the United States or any agency or instrumentality thereof,
                provided such obligations are backed by the full faith and credit
                of the
                United States;

            


    

     

    
      	 	
              (ii)

            	
              repurchase
                obligations (the collateral for which is held by a third party) with
                respect to any security described in clause (i) above, provided that
                the
                long-term unsecured obligations of the party agreeing to repurchase
                such
                obligations are at the time rated by each of the Rating Agencies
                in one of
                its two highest rating categories;

            


    

     

    
      	 	
              (iii)

            	
              certificates
                of deposit, time deposits, demand deposits and bankers’ acceptances of any
                bank or trust company incorporated under the laws of the United States
                or
                any state thereof or the District of Columbia, provided that the
                short-term commercial paper of such bank or trust company at the
                date of
                acquisition thereof has been rated by each of the Rating Agencies
                in its
                highest rating;

            


    

     

    
      	 	
              (iv)

            	
              money
                market funds rated by each of the Rating Agencies in its highest
                short-term debt rating category;

            


    

     

    
      	 	
              (v)

            	
              commercial
                paper (having original maturities of not more than 365 days) of any
                corporation incorporated under the laws of the United States or any
                state
                thereof or the District of Columbia which on the date of acquisition
                has
                been rated by each of the Rating Agencies in its highest short-term
                rating
                category; and

            


    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (vi)

            	
              any
                other obligation or security acceptable to each of the Rating Agencies
                (as
                certified by a letter from each of the Rating Agencies to Owner)
                in
                respect of mortgage pass through certificates rated in one of its
                two
                highest rating categories;

            


    

     

    provided,
      that with the exception of U.S. Treasury Strips, no such instrument shall be
      a
      Permitted Investment if such instrument evidences either (a) the right to
      receive interest only payments with respect to the obligations underlying such
      instrument or (b) both principal and interest payments derived from obligations
      underlying such instrument where the principal and interest payments with
      respect to such instruments provide a yield to maturity exceeding 120% of the
      yield to maturity at par of such underlying obligation.

     

    “Prepayment
      Interest Shortfall”: With respect to any Remittance Date and any Mortgage Loan
      that was the subject of a principal prepayment during the related Principal
      Prepayment Period, an amount equal to one month’s interest at the Mortgage Loan
      Remittance Rate on the amount of such principal prepayment less the amount
      of
      interest (adjusted to the Mortgage Loan Remittance Rate) paid by the Mortgagor
      in respect of such principal prepayment.

     

    “Principal
      Prepayment Period”: As to any Remittance Date, the calendar month preceding the
      month of distribution.

     

    “Rating
      Agency”: Either of Standard & Poor’s and Moody’s.

     

    “Record
      Date”: The close of business of the last Business Day of the month preceding the
      month of the related Remittance Date.

     

    “REMIC”:
      A real estate mortgage investment conduit, as such term is defined by the
      Internal Revenue Code of 1986, as amended.

     

    “Remittance
      Date”: The 18th day of any month or, if such 18th day is not a Business Day, the
      first Business Day immediately preceding such 18th day.

     

    “REO
      Disposition”: The final sale by the Owner of any REO Property.

     

    “REO
      Property”: A Mortgaged Property acquired by the Servicer on behalf of Owner as
      described in Section
      4.11.

     

    “Servicing
      Advances”: All customary, reasonable and necessary “out of pocket” costs and
      expenses incurred in the performance by the Servicer of its servicing
      obligations, including, but not limited to, the cost of (i) the preservation,
      restoration and protection of the Mortgaged Property, (ii) paying taxes and
      insurance with respect to the Mortgaged Property, (iii) enforcement of judicial
      proceedings, including foreclosures, bankruptcies and defense of claims relating
      to the Mortgages and Mortgaged Property, and (iv) the management and liquidation
      of the REO Property.

     

    “Servicing
      Criteria”: The “servicing criteria” set forth in Item 1122(d) of Regulation AB,
      as such may be amended from time to time.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    “Servicing
      Fee”: With respect to any Mortgage Loan and any Remittance Date, the fee payable
      monthly to the Servicer pursuant to Section
      7.03.

     

    “Servicing
      Officer”: Any officer of the Servicer involved in, or responsible for, the
      administration and servicing of the Mortgage Loans whose name appears on a
      list
      of servicing officers furnished by the Servicer to Owner upon request, as such
      list may from time to time be amended.

     

    “Specially
      Serviced Mortgage Loan”: A Mortgage Loan as to which the following events have
      occurred and is continuing (i) monthly mortgage payment being more that 60
      days
      delinquent (ii) any filing of insolvency proceeding on behalf of the related
      Mortgagor or (iii) any receipt by the Servicer of notice of foreclosure of
      the
      related mortgage property.

     

    “Standard
      & Poor’s”: Standard & Poor’s Ratings Services, a division of the
      McGraw-Hill Companies, Inc., or its successor in interest.

     

    “Subcontractor”:
      Any vendor, subcontractor or other Person that is not responsible for the
      overall servicing (as “servicing” is commonly understood by participants in the
      mortgage-backed securities market) of Mortgage Loans but performs one or more
      discrete functions identified in Item 1122(d) of Regulation AB with
      respect to Mortgage Loans under the direction or authority of the Seller or
      a
      Subservicer.

     

    “Subservicer”:
      Any Person that services Mortgage Loans on behalf of the Seller or any
      Subservicer and is responsible for the performance (whether directly or through
      Subservicers or Subcontractors) of a substantial portion of the material
      servicing functions required to be performed by the Seller under this Agreement
      or any Reconstitution Agreement that are identified in Item 1122(d) of
      Regulation AB.

     

    “Subservicing
      Account”: An account established by a Subservicer which meets the requirements
      set forth in Section
      4.17
      and is
      otherwise acceptable to the Servicer, and which must be an Eligible
      Account.

     

    “Subservicing
      Agreement”: The written agreement between the Servicer and a Subservicer
      relating to the servicing and administration of the Mortgage Loans as provided
      in Section
      4.13.

     

    “Surety
      Agreement”: The Surety Bond Reimbursement Agreement dated March 17, 1999 between
      the Surety Bond Issuer and the Servicer pursuant to which the Surety Bond Issuer
      has issued the Surety Bond, as the same may be amended, modified, restated
      or
      supplemented from time to time.

     

    “Surety
      Bond”: The limited purpose Surety Bond, dated March 17, 1999, issued by the
      Surety Bond Issuer in favor of the Sellers, as the same may be amended,
      modified, restated or supplemented from time to time.

     

    “Surety
      Bond Issuer”: shall mean AMBAC Assurance Corp or its successors.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      II

     

    BOOKS
      AND RECORDS; TRANSFER OF MORTGAGE LOANS

     

    Section
      2.01 Books
      and Records.

     

    The
      Servicer shall be responsible for maintaining, and shall maintain, a complete
      set of books and records for the Mortgage Loans, which shall be appropriately
      identified in the Servicer’s books and records to clearly reflect the ownership
      of the Mortgage Loans by Owner, and subsequent assignments and transfers of
      the
      Mortgage Loans pursuant to Section
      2.02
      hereof.
      At the request of Owner, the Servicer shall promptly deliver to Owner an MSA
      Mortgage Loan Schedule setting forth all Mortgage Loans that the Servicer then
      services and administers for Owner under this Agreement; provided, however,
      that
      the information contained on such MSA Mortgage Loan Schedule may be as of the
      Closing Date for each respective Mortgage Loan and may consist of the Mortgage
      Loan Schedule(s) attached to the Bill(s) of Sale for such Mortgage Loans, with
      manual deletions or additions thereto or other revisions thereof.

     

    Section
      2.02 Transfer
      of Mortgage Loans.

     

    Owner
      may, with the consent of the Servicer (which shall not be unreasonably
      withheld), assign, sell or transfer (each, a “Transfer”) any of Owner’s interest
      in and to any of the Mortgage Loans to any institutional investor that has
      a net
      worth of not less than $50,000,000 and owns not less than $250,000,000 in
      residential mortgage loans (each, a “Permitted Transferee”), subject in each
      case to the rights of the Servicer under the provisions of this Agreement
      (including, without limitation, the right of the Servicer to continue servicing
      such Mortgage Loans on the terms set forth herein), except that no such
      assignment, sale, transfer, pledge, hypothecation or encumbrance shall increase
      the Servicer’s liabilities or obligations or decrease the Servicer’s rights
      under this Agreement, and Owner shall remain fully liable for performance of
      all
      of its obligations as to the transferred Mortgage Loans. As a condition
      precedent to any Transfer (in addition to the other conditions set forth
      herein), the Permitted Transferee shall enter into a servicing agreement with
      the Servicer in the form of this Agreement, but mutatis mutandis, and deliver
      such certificates and opinions as the Servicer may reasonably require. Upon
      consummation of any Transfer, the MSA Mortgage Loan Schedule shall be amended
      by
      the Servicer to reflect such transfer. Notwithstanding the foregoing, Owner
      shall not make any Transfer of (i) less than forty (40) Mortgage Loans, (ii)
      Mortgage Loans with an aggregate unpaid principal balance less than $5,000,000
      to any Person or if the remaining Mortgage Loans listed on the MSA Mortgage
      Loan
      Schedule after giving effect thereto would have an aggregate unpaid principal
      balance less than $5,000,000 or (iii) any Mortgage Loans other than to a
      Permitted Transferee in a transaction that complies with the terms of this
      Agreement.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      III

     

    REPRESENTATIONS
      AND WARRANTIES OF THE SERVICER

     

    Section
      3.01 Representations
      and Warranties of the Servicer.

     

    The
      Servicer represents, warrants and covenants to Owner, as of the date of this
      Agreement and as of each Closing Date or as of such other date specified below,
      that:

     

    (i) The
      Servicer (a) is a corporation, duly incorporated, validly existing and in good
      standing under the laws of the State of Delaware, (b) has all licenses necessary
      to carry on its business as now being conducted, (c) has all material licenses
      and is qualified and in good standing under the laws of each state where a
      Mortgaged Property is located to the extent required under applicable law to
      effect such qualification, and (d) is in compliance with the laws of each such
      state to the extent necessary to permit the enforcement of Owner’s rights
      (either directly or through a Subservicer) under each Mortgage Loan and to
      permit the servicing of the Mortgage Loans in accordance with the terms of
      this
      Agreement.

     

    (ii) The
      Servicer has full power and authority to hold each Mortgage Loan, to service
      each Mortgage Loan, to execute and deliver this Agreement, and to enter into
      and
      consummate all transactions contemplated by this Agreement. The Servicer has
      duly authorized the execution, delivery and performance of this Agreement,
      has
      duly executed and delivered this Agreement, and this Agreement, assuming due
      authorization, execution and delivery by Owner and the enforceability against
      Owner, constitutes a legal, valid and binding obligation of the Servicer,
      enforceable against it in accordance with its terms, except as the
      enforceability thereof may be limited by bankruptcy, insolvency, liquidation,
      moratorium, reorganization or other similar laws affecting the rights of
      creditors generally or by general principles of equity, regardless of whether
      enforcement is sought in a proceeding in equity or at law.

     

    (iii) The
      consummation of the transactions contemplated by this Agreement is in the
      ordinary course of the Servicer’s business and will not conflict with or result
      in a breach of any of the terms, conditions or provisions of the Servicer’s
      certificate of incorporation or by-laws or any legal restriction or any material
      agreement or instrument to which the Servicer is now party or by which it is
      bound, or constitute a material default or result in an acceleration under
      any
      of the foregoing, or result in the violation of any law, rule, regulation,
      order, judgment or decree to which the Servicer or its property is
      subject.

     

    (iv) The
      Servicer is an approved seller/servicer for Fannie Mae or Freddie Mac in good
      standing and is a mortgagee approved by the Secretary of Housing and Urban
      Development pursuant to Section
      203
      of the
      National Housing Act. No event has occurred that would render the Servicer
      unable to comply with Fannie Mae or Freddie Mac eligibility requirements or
      that
      would require notification to either Fannie Mae or Freddie Mac.

     

    (v) The
      Servicer has no reason or cause to believe that it cannot perform each covenant
      contained in this Agreement.

     

    (vi) There
      is
      no action suit, proceeding or investigation pending or, to the Servicer’s
      knowledge, threatened, against the Servicer that, in the Servicer’s judgment, if
      determined adversely to the Servicer, would materially and adversely affect
      the
      validity or enforceability of this Agreement or the ability of the Servicer
      to
      perform its obligations hereunder in accordance with the terms
      hereof.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (vii) No
      consent, approval, authorization or order of any court or governmental authority
      is required for the execution and delivery of this Agreement by the Servicer
      or
      for the performance by the Servicer of its obligations hereunder, other than
      any
      such consent, approval, authorization or order as has been obtained prior to
      the
      Closing Date.

     

    The
      Servicer shall indemnify Owner and hold it harmless against any losses, damages,
      penalties, fines, forfeitures, legal fees and related costs, judgments, and
      other costs and expenses resulting from any claim, demand, defense or assertion
      based on or grounded upon, or resulting from, a breach of the Servicer’s
      representations and warranties contained in this Section
      3.01.
      It is
      understood and agreed that the obligations of the Servicer set forth in this
      Section
      3.01
      to
      indemnify Owner as provided above constitute the sole remedies of Owner
      respecting a breach of the foregoing representations and
      warranties.

     

    ARTICLE
      IV

     

    ADMINISTRATION
      AND SERVICING OF MORTGAGE LOANS

     

    Section
      4.01 Role
      of the Servicer.

     

    The
      Servicer, as independent contract servicer, shall service and administer the
      Mortgage Loans in accordance with this Agreement and the normal and usual
      standards of practice of prudent mortgage lenders, and shall have full power
      and
      authority, acting alone, to do or cause to be done any and all things in
      connection with such servicing and administration that the Servicer may deem
      necessary or desirable and consistent with the terms of this
      Agreement.

     

    Consistent
      with the terms of this Agreement, at the respective Mortgagor’s request or as
      required by applicable law, the Servicer may waive, modify or vary any term
      of
      any Mortgage Loan or consent to the postponement of strict compliance with
      any
      such term or in any manner grant indulgence to any Mortgagor if, in the
      Servicer’s reasonable and prudent determination, such waiver, modification,
      postponement or indulgence is consistent with industry practice and not
      materially adverse to Owner, including actions intended to maximize collections
      on such Mortgage Loan; provided, however, that, except as permitted by the
      following paragraph, the Servicer shall not permit any modification with respect
      to any Mortgage Loan that would change the Mortgage Interest Rate, forgive
      the
      payment of any principal or interest payments, make future advances or extend
      the final maturity date on such Mortgage Loan. Without limiting the generality
      of the foregoing, the Servicer shall continue, and is hereby authorized and
      empowered, to execute and deliver on behalf of itself and Owner, all instruments
      of satisfaction or cancellation, or of partial or full release, discharge and
      all other comparable instruments, with respect to the Mortgage Loans and with
      respect to the Mortgaged Property. Owner has provided and shall, as necessary,
      promptly furnish the Servicer with such powers of attorney (a form of which
      is
      attached hereto as Exhibit A) as are necessary and appropriate and with such
      other documents as are necessary or appropriate to enable the Servicer to carry
      out its servicing and administrative duties under this Agreement.

     

    Notwithstanding
      any other provision in this Agreement or the Master Mortgage Loan Purchase
      Agreement to the contrary:

     

    (i) In
      the
      case of any Mortgage Loan, the Servicer may waive any late payment charge,
      penalty, interest or any assumption fees, or other fees which may be collected
      in the ordinary course of servicing such Mortgage Loan;

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (ii) In
      the
      case of a Specially Serviced Mortgage Loan, the Servicer shall notify the Owner
      in writing by either fax, email or other mutually acceptable means and obtain
      the Owner’s written consent prior to the Servicer modifying, amending or waiving
      any of the financial terms of, or making any other modifications to the Mortgage
      Loan. If Owner notifies the Servicer of its refusal to consent thereto, then
      the
      Servicer shall, at its option, repurchase the related Specially Serviced
      Mortgage Loan. Such repurchase shall be at a price equal to (a) the Assumed
      Principal Balance of the Mortgage Loan plus (b) accrued interest on such Assumed
      Principal Balance at the Mortgage Loan Remittance Rate has last been paid and
      distributed to Purchaser to the date of repurchase. Further, if such Mortgage
      Loan is an Additional Collateral Mortgage Loan, Servicer may release a portion
      of or all of the Additional Collateral related thereto provided that the release
      of such Additional Collateral is in accordance with the Additional Collateral
      Pledge Agreement; and 

     

    (iii) The
      Servicer shall specifically notify the Owner and obtain the Owner’s consent to
      the Servicer taking any of the following actions: (a) selling any Specially
      Serviced Mortgage Loan or REO Property, (b) forgiving principal or interest
      on,
      or permitting to be satisfied at a discount, any Mortgage Loan; or (c) accepting
      substitute or additional collateral, or releasing any collateral, for a Mortgage
      Loan.

     

    In
      servicing and administering the Mortgage Loans, the Servicer shall employ
      procedures including collection procedures and exercise the same care that
      it
      customarily employs and exercises in servicing and administering mortgage loans
      for its own account giving due consideration to accepted mortgage servicing
      practices of prudent lending institutions and Owner’s reliance on the Servicer.
      In servicing and administering the Mortgage Loans, the Servicer may permit
      any
      Governmental Authority to have access to and review and copy the files of the
      Servicer with respect to the Mortgage Loans, and Servicer is authorized to
      do
      whatever is necessary to comply with all Applicable Laws and the requirements
      of
      such Governmental Authority, including without limitation any required
      modifications of the Loan Documents.

     

    Section
      4.02 Collection
      of Mortgage Loan Payments.

     

    Continuously
      from the date hereof until the principal and interest on all Mortgage Loans
      are
      paid in full, the Servicer shall proceed diligently to collect all payments
      due
      under each Mortgage Loan when the same shall become due and payable and shall,
      to the extent such procedures shall be consistent with this Agreement and the
      terms and provisions of any related Primary Mortgage Insurance Policy, follow
      such collection procedures as it follows with respect to mortgage loans
      comparable to the Mortgage Loans held for its own account. Further, the Servicer
      will take special care in ascertaining and estimating annual ground rents,
      taxes, assessments, water rates, property insurance premiums, mortgage insurance
      premiums, and all other charges that, as provided in the Mortgage, will become
      due and payable to the end that the installments payable by the Mortgagors
      will
      be sufficient to pay such charges as and when they become due and
      payable.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    Section
      4.03 Realization
      Upon Defaulted Mortgage Loans.

     

    The
      Servicer shall use reasonable efforts, consistent with the procedures that
      the
      Servicer would use in servicing loans for its own account, to foreclose upon
      or
      otherwise comparably convert the ownership of Mortgaged Properties which secure
      Mortgaged Loans which come into and continue in default and as to which no
      satisfactory arrangements can be made for collection of delinquent payments
      pursuant to Section 4.01. In addition, if an Additional Collateral Mortgage
      Loan
      becomes a defaulted Mortgage Loan, the Servicer shall make all reasonable
      efforts available under the Loan Documents to realize upon the Additional
      Collateral pertaining to such Mortgage Loan, and any proceeds from the
      realization thereof (and not such Additional Collateral itself) shall be
      included in the related Liquidation Proceeds and deposited in the Custodial
      Account, net of any related Servicing Advances. The Servicer shall use
      reasonable efforts to realize upon defaulted Mortgage Loans in such a manner
      as
      will maximize the receipt of principal and interest by Owner, taking into
      account, among other things, the timing of foreclosure proceedings and any
      proceedings with respect to Additional Collateral. The foregoing is subject
      to
      the provisions that, in any case in which Mortgaged Property shall have suffered
      damage, the Servicer shall not be required to expend its own funds toward the
      restoration of such property in excess of an aggregate of $2,000 during the
      life
      of the Mortgage Loan, unless it shall determine in its discretion (i) that
      such
      restoration will increase the proceeds of liquidation of the related Mortgage
      Loan to Owner after reimbursement to itself for such expenses, and (ii) that
      such expenses will be recoverable by the Servicer through Insurance Proceeds
      or
      Liquidation Proceeds from the related Mortgaged Property, as contemplated in
      Section 4.05.

     

    In
      the
      event that any payment due under any Mortgage Loan becomes 90 days delinquent
      and, in the judgment of the Servicer, the related Mortgagor is not likely to
      become current within a reasonable period of time, the Servicer shall commence
      foreclosure or other proceedings to realize upon the Mortgaged Property securing
      such Mortgage Loan.

     

    Section
      4.04 Establishment
      of Custodial Accounts; Deposits in Custodial Accounts.

     

    The
      Servicer shall establish and maintain at all times appropriate custodial
      accounts for principal and interest, and taxes and insurance with respect to
      the
      Mortgage Loans. The Servicer shall segregate and hold all funds constituting
      Escrow Payments collected and received pursuant to a Mortgage Loan to be so
      deposited, separate and apart from any of its own funds and general assets.
      

     

    The
      Servicer shall deposit in the Custodial Account and retain therein the following
      payments and collections received or made by it subsequent to the Cut-off Date,
      or received by it prior to the Cut-off Date but allocable to a period subsequent
      thereto, other than in respect of principal and interest on the Mortgage Loans
      due on or before the Cut-off Date:

     

    (i) All
      payments on account of principal, including principal prepayments, on the
      Mortgage Loans;

     

    
      
        
        

      

      
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    (ii) All
      payments on account of interest on the Mortgage Loans adjusted to the Mortgage
      Loan Remittance Rate;

     

    (iii) All
      Liquidation Proceeds;

     

    (iv) All
      Insurance Proceeds including amounts required to be deposited pursuant to
Sections
      4.06,
      4.11
      and
4.18,
      other
      than proceeds to be held in the Escrow Account and applied to the restoration
      or
      repair of the Mortgaged Property or released to the Mortgagor in accordance
      with
      the Servicer’s normal servicing procedures the related loan documents or
      applicable law;

     

    (v) All
      Condemnation Proceeds affecting any Mortgaged Property that are not released
      to
      the Mortgagor in accordance with the Servicer’s normal servicing procedures, the
      loan documents or applicable law;

     

    (vi) Any
      Monthly Advances;

     

    (vii) All
      proceeds of any Mortgage Loan repurchased in accordance with Section 5(c) or
      (d)
      of the Purchase Agreement, and all amounts required to be deposited by the
      Servicer in connection with shortfalls in principal amount of Qualified
      Substitute Mortgage Loans pursuant to Section 5(c) of the Purchase
      Agreement;

     

    (viii) Any
      amounts required to be deposited by the Servicer pursuant to Section 6.04 for
      the month of distribution;

     

    (ix) Any
      amounts in respect of Permitted Investments required to be deposited pursuant
      to
      Section 4.18;

     

    (x) Any
      amounts required to be deposited by the Servicer in connection with any REO
      Property pursuant to Section 4.11; and

     

    (xi) Any
      amounts required to be deposited into the Custodial Account pursuant to Section
      7.01.

     

    The
      foregoing requirements for deposit in the Custodial Account shall be exclusive,
      it being understood and agreed that, without limiting the generality of the
      foregoing, payments in the nature of late payment charges and assumption fees,
      to the extent permitted by Section 7.01, need not be deposited by the Servicer
      in the Custodial Account. Any interest paid on funds deposited into the
      Custodial Account by the depository institution shall accrue to the benefit
      of
      the Servicer and the Servicer shall be entitled to retain and withdraw such
      interest from the Custodial Account pursuant to Section 4.05(iv). In addition,
      funds in the Custodial Account may be invested in Permitted Investments in
      accordance with the provisions set forth in Section 4.18.

     

    Section
      4.05 Permitted
      Withdrawals From the Custodial Account.

     

    The
      Servicer may, from time to time, make withdrawals from the Custodial Account
      for
      the following purposes:

     

    (i) To
      make
      payments to Owner in the amounts and in the manner provided for in Section
      6.01;

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    (ii) To
      reimburse itself for each unreimbursed Monthly Advance from the related Monthly
      Payments collected from the Mortgagors or, to the extent an unreimbursed Monthly
      Advance is determined by the Servicer to be unrecoverable, from any funds in
      the
      Custodial Account;

     

    (iii) To
      reimburse itself for unreimbursed Servicing Advances and for unreimbursed
      Servicing Fees, provided that with respect to any Mortgage Loan the Servicer’s
      right to such reimbursement shall be limited, subject to Section 4.13, to the
      related funds collected by the Servicer from the Mortgagor or any other Person
      including, but not limited to, Liquidation Proceeds, Condemnation Proceeds
      and
      Insurance Proceeds, and with respect to REO Property, funds received as rental
      or similar income. The Servicer’s right to the reimbursement set forth in the
      preceding sentence shall be prior to the rights of Owner to such proceeds and
      amounts, except that where the Servicer is required to repurchase a Mortgage
      Loan pursuant to Section 5(c) or (d) of the Purchase Agreement, the Servicer’s
      right to such reimbursement shall be subsequent to the rights of Owner to
      receive payment from the Custodial Account representing the repurchase price
      set
      forth in Section 5(c) or (d) of the Purchase Agreement, as applicable, and
      representing all other amounts required to be paid to Owner with respect to
      such
      repurchased Mortgage Loan;

     

    (iv) To
      pay
      itself as servicing compensation any interest earned on funds in the Custodial
      Account;

     

    (v) To
      pay
      itself with respect to each Mortgage Loan that has been repurchased pursuant
      to
      Section 5(c) or (d) of the Purchase Agreement all related Monthly Payments
      and
      such other amounts as may be collected by the Servicer from the Mortgagor or
      otherwise relating to such Mortgage Loan, provided that such Monthly Payments
      or
      other amounts have not been distributed as of the date on which the related
      repurchase price is determined;

     

    (vi) To
      refund
      to the Servicer any amount deposited in the Custodial Account and not required
      to be deposited therein; and

     

    (vii) To
      clear
      and terminate the Custodial Account upon the termination of this
      Agreement.

     

    Section
      4.06 Establishment
      of Escrow Accounts; Deposits in Escrow Accounts.

     

    The
      Servicer shall segregate and hold all funds collected and received pursuant
      to
      each Mortgage Loan which constitute Escrow Payments separate and apart from
      any
      of its own funds and general assets. The Servicer will establish one or more
      Escrow Accounts for such purpose, each of which shall be an Eligible
      Account.

     

    The
      Servicer shall deposit in the Escrow Account or Accounts on a daily basis,
      and
      retain therein, (i) all Escrow Payments collected on account of the Mortgage
      Loans, for the purpose of effecting timely payment of any such items as required
      under the terms of this Agreement, and (ii) all Insurance Proceeds which are
      to
      be applied to the restoration or repair of any Mortgaged Property. The Servicer
      shall make withdrawals therefrom only to effect such payments as are required
      or
      contemplated under this Agreement, and for such other purposes as set forth
      or
      in accordance with Section 4.07. The Servicer shall be entitled to retain any
      interest paid on funds deposited into the Escrow Account by the depository
      institution other than interest on escrowed funds required by law to be paid
      to
      a Mortgagor.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    Section
      4.07 Permitted
      Withdrawals From Escrow Account.

     

    Withdrawals
      from the Escrow Account may be made by the Servicer (i) to effect timely
      payments of ground rents, taxes, assessments, water rates, property insurance
      premiums, Primary Mortgage Insurance Policy premiums, if applicable, and
      comparable items, (ii) to reimburse the Servicer for any Servicing Advance
      made
      by the Servicer with respect to an Escrow Payment, but only from amounts
      received on the related Mortgage Loan which represent late payments or
      collections of Escrow Payments thereunder, and only to the extent permitted
      by
      applicable law, (iii) to refund to the Mortgagor any funds as may be determined
      to be overages, (iv) for transfer to the Custodial Account in accordance with
      the terms of this Agreement, (v) for application to restoration or repair of
      the
      Mortgaged Property, (vi) to pay to the Servicer, or to the Mortgagor to the
      extent required by law, any interest paid on the funds deposited into the Escrow
      Account, (vii) to refund to the Servicer any amount deposited in the Escrow
      Account and not required to be deposited therein or (viii) to clear and
      terminate the Escrow Account on the termination of this Agreement. As part
      of
      its servicing duties, the Servicer shall pay to the Mortgagors interest on
      funds
      in the Escrow Account, to the extent required by law, and to the extent that
      interest earned on funds in the Escrow Account is insufficient, shall pay such
      interest from its own funds, without any reimbursement therefor.

     

    Section
      4.08 Transfer
      of Accounts.

     

    The
      Servicer may transfer the Custodial Account or the Escrow Account to a different
      depository institution from time to time. The Servicer shall promptly notify
      Owner upon making any such transfer. In any case, the Custodial Account and
      Escrow Account shall be Eligible Accounts.

     

    Section
      4.09 [INTENTIONALLY
      OMITTED]

     

    Section
      4.10 Errors
      and Omissions Insurance.

     

    The
      Servicer shall maintain, at its own expense, a blanket fidelity bond and an
      errors and omissions insurance policy, with broad coverage with responsible
      companies that would meet the requirements of Fannie Mae or Freddie Mac on
      all
      officers, employees or other persons acting in any capacity with regard to
      the
      Mortgage Loans to handle funds, money, documents and papers relating to the
      Mortgage Loans. The errors and omissions insurance shall be in the form of
      the
      Mortgage Banker’s Blanket Bond and shall protect and insure the Servicer against
      losses, including forgery, theft, embezzlement and omissions and negligent
      acts
      of such Persons and shall also protect and insure the Servicer against losses
      in
      connection with the failure to maintain any insurance policies required pursuant
      to this Agreement and the release or satisfaction of a Mortgage Loan without
      having obtained payment in full of the indebtedness secured thereby. No
      provision of this Section 4.10 requiring the errors and omissions insurance
      shall diminish or relieve the Servicer from its duties and obligations as set
      forth in this Agreement. The minimum coverage under any such bond and insurance
      policy shall be at least equal to the corresponding amounts required by Fannie
      Mae in the Fannie Mae Sellers’ and Servicers’ Guide or by Freddie Mac in the
      Freddie Mac Sellers’ and Servicer’s Guide. Upon request of any Owner, the
      Servicer shall cause to be delivered to Owner a copy of the insurance policy
      and
      shall use reasonable efforts to obtain a statement from the surety and the
      insurer that such insurance policy shall in no event be terminated or materially
      modified without thirty (30) days prior written notice to Owner.

     

    
      
        
        

      

      
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    Section
      4.11 Title
      Management and Disposition of REO Property.

     

    The
      Servicer shall either itself or through an agent selected by the Servicer,
      manage, conserve, protect and operate each REO Property (and may temporarily
      rent the same) in the same manner that it manages, conserves, protects and
      operates other foreclosed property for its own account, and in the same manner
      that similar property in the same locality as the REO Property is managed.
      The
      Servicer shall cause each REO Property to be inspected promptly upon the
      acquisition of title thereto and shall cause each REO Property to be inspected
      at least annually thereafter. The Servicer shall use reasonable efforts to
      dispose of the REO Property in a commercially reasonable manner as soon as
      possible. If Owner has notified the Servicer in writing that an REO Property
      is
      held as part of a REMIC, the Servicer will make reasonable efforts to sell
      such
      REO Property within the time necessary to preserve such REMIC status as advised
      by Owner in the notice thereof.

     

    If
      title
      to any Mortgaged Property is acquired in foreclosure or by deed in lieu of
      foreclosure (each, an “REO Property”), the deed or certificate of sale shall be
      taken in the name of the Owner or the Person (which may be the Servicer for
      the
      benefit of the Owner) designated by the Owner, or in the event the Owner
      notifies the Servicer that the Owner or such Person is not authorized or
      permitted to hold title to real property in the state where the REO Property
      is
      located, or would be adversely affected under the “doing business” or tax laws
      of such state by so holding title, the deed or certificate of sale shall be
      taken in the name of such Person or Persons as shall be consistent with an
      opinion of counsel obtained by the Owner from an attorney duly licensed to
      practice law in the state where the REO Property is located. The Servicer
      (acting alone or through a subservicer), on behalf of the Owner, shall provide
      for the maintenance and disposal of REO on behalf of the Owner as outlined
      under
      section 6 of the collection manual of Servicer.

     

    The
      Servicer shall deposit and hold all revenues and funds collected and received
      in
      connection with the operation of each REO Property in the Custodial Account,
      and
      the Servicer shall account separately for revenues and funds received or
      expended with respect to each REO Property.

     

    The
      Servicer shall have full power and authority, subject only to the specific
      requirements and prohibitions of this Agreement to do any and all things in
      connection with any REO Property as are consistent with the servicing standards
      set forth in Section 4.01. In connection therewith, the Servicer shall deposit
      or cause to be deposited on a daily basis in the Custodial Account all revenues
      and collections received or collected by it with respect to each REO Property,
      including all proceeds of any REO Disposition. The Servicer shall withdraw
      (without duplication) from the Custodial Account, but solely from the revenues
      and collections received or collected by it with respect to a specific REO
      Property, such funds necessary for the proper operation, management and
      maintenance of such REO Property, including the following:

     

    
      	 	
              (a)

            	
              all
                insurance premiums due and payable in respect of such REO
                Property;

            


    

     

    
      
        
        

      

      
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              (b)

            	
              all
                real estate taxes and assessments in respect of such REO Property
                that may
                result in the imposition of a lien
                thereon;

            


    

     

    
      	 	
              (c)

            	
              all
                customary and reasonable costs and expenses necessary to maintain,
                repair,
                appraise, evaluate, manage or operate such REO Property (including
                the
                customary and reasonable costs incurred by any “managing agent” retained
                by the Servicer in connection with the maintenance, management or
                operation of such REO Property);

            


    

     

    
      	 	
              (d)

            	
              all
                reasonable costs and expenses of restoration improvements, deferred
                maintenance and tenant improvements;
                and

            


    

     

    
      	 	
              (e)

            	
              all
                other reasonable costs and expenses, including reasonable attorneys’ fees,
                that the Servicer may suffer or incur in connection with its performance
                of its obligations under this Section (other than costs and expenses
                that
                the Servicer is expressly obligated to bear pursuant to this
                Agreement).

            


    

     

    To
      the
      extent that amounts on deposit in the Custodial Account are insufficient for
      the
      purposes set forth in clauses (1) through (5) above, the Servicer shall, subject
      to Section 6.03, advance the amount of funds required to cover the shortfall
      with respect thereto. The Servicer shall promptly notify the Owner in writing
      of
      any failure by the Servicer to make a Servicing Advance of the type specified
      in
      clauses (1) or (2) above (irrespective of whether such Servicing Advance is
      claimed to be non-recoverable by the Servicer pursuant to Section 6.03).


     

    The
      Servicer shall notify Owner of its receipt of a bona fide offer for any REO
      Property. Following the consummation of an REO Disposition, the Servicer shall
      remit to the Owner, in accordance with Section 6.01, any proceeds from such
      REO
      Disposition in the Custodial Account following the payment of all expenses
      and
      Servicing Advances relating to the subject REO Property.

     

    Section
      4.12 Adjustments
      to Mortgage Interest Rates.

     

    The
      Servicer shall make interest rate adjustments and payment amount adjustments
      for
      each Adjustable Rate Mortgage Loan in accordance with the terms of the related
      Mortgage Note and will deliver to the related Mortgagor written notice of such
      adjustments in accordance with the terms of such Mortgage Note and the
      requirements of applicable law.

     

    Section
      4.13 Subservicing
      Agreements Between the Servicer and Subservicers.

     

    (a) Subject
      to Section 13.06, the Servicer may enter into Subservicing Agreements with
      Subservicers for the servicing and administration of the Mortgage Loans. The
      terms of any Subservicing Agreement shall not be inconsistent with any of the
      provisions of this Agreement. Each Subservicer shall be (i) authorized to
      transact business in the state or states in which the Mortgaged Properties
      related to the Mortgage Loans such Subservicer is to service are situated,
      if
      and to the extent required by applicable law to enable the Subservicer to
      perform its obligations hereunder and under the Subservicing Agreement, and
      (ii)
      a Freddie Mac- or Fannie Mae-approved mortgage servicer. Each Subservicing
      Agreement must impose on the Subservicer requirements conforming to the
      provisions set forth in Section 4.17 and provide for servicing of the Mortgage
      Loans consistent with the terms of this Agreement.

     

    
      
        
        

      

      
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    (b) As
      part
      of its servicing activities hereunder, the Servicer, for the benefit of Owner,
      shall enforce the obligations of each Subservicer under the related Subservicing
      Agreement, including, without limitation, any obligation to make advances in
      respect of delinquent payments as required by a Subservicing Agreement. Such
      enforcement, including without limitation, the legal prosecution of claims,
      termination of Subservicing Agreements, and the pursuit of other appropriate
      remedies, shall be in such form and carried out to such an extent and at such
      time as the Servicer, in its good faith business judgment, would require were
      it
      the owner of the related Mortgage Loans. The Servicer shall pay the costs of
      such enforcement, to the extent, if any, that such recovery (i) exceeds all
      amounts due in respect of the related Mortgage Loans, or (ii) is from a specific
      recovery of costs, expenses or attorneys’ fees against the party against whom
      such enforcement is directed.

     

    Section
      4.14 Successor
      Subservicers.

     

    The
      Servicer shall be entitled to terminate any Subservicing Agreement and the
      rights and obligations of any Subservicer pursuant to any Subservicing Agreement
      in accordance with the terms and conditions of such Subservicing Agreement.
      In
      the event of termination of any Subservicer, the Servicer either shall directly
      service the related Mortgage Loans or shall enter into a Subservicing Agreement
      with a successor Subservicer which qualifies under Section 4.13.

     

    Section
      4.15 Liability
      of the Servicer.

     

    Notwithstanding
      any Subservicing Agreement, any of the provisions of this Agreement relating
      to
      agreements or arrangements between the Servicer and a Subservicer or reference
      to actions taken through a Subservicer or otherwise, the Servicer shall remain
      obligated and primarily liable to Owner for the servicing and administering
      of
      the Mortgage Loans in accordance with the provisions of Section 4.01 without
      diminution of such obligation or liability by virtue of such Subservicing
      Agreements or arrangements or by virtue of indemnification from the Subservicer
      and to the same extent and under the same terms and conditions as if the
      Servicer alone were servicing and administering the Mortgage Loans. The Servicer
      shall be entitled to enter into any agreement with a Subservicer for
      indemnification of the Servicer by such Subservicer and nothing contained in
      this Agreement shall be deemed to limit or modify such
      indemnification.

     

    Section
      4.16 Assumption
      or Termination of Subservicing Agreements.

     

    In
      the
      event that Morgan Stanley Credit Corporation, or its successors (collectively,
      “MSCC”) shall for any reason cease to be the servicer of the Mortgage Loans
      under this Agreement, Owner or its designee may, if MSCC does not terminate
      any
      Subservicing Agreement in accordance with its terms, thereupon assume all of
      the
      rights and obligations of MSCC under such Subservicing Agreement. Upon such
      assumption, Owner or its designee shall be deemed to have assumed all of MSCC’s
      interest therein and to have replaced MSCC as a party to each Subservicing
      Agreement to the same extent as if the Subservicing Agreements had been assigned
      to the assuming party, except that MSCC shall not thereby be relieved of any
      liability or obligations under the Subservicing Agreements and MSCC shall
      continue to be entitled to any rights or benefits, in each case, which arose
      prior to its termination as servicer.

     

    
      
        
        

      

      
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    The
      Servicer at its expense shall, upon the request of Owner, deliver to the
      assuming party all documents and records relating to each Subservicing Agreement
      and the Mortgage Loans then being serviced and an accounting of amounts
      collected and held by it and otherwise use reasonable efforts to effect the
      orderly and efficient transfer of the Subservicing Agreements to the assuming
      party.

     

    Section
      4.17 Servicing
      Accounts.

     

    In
      those
      cases where a Subservicer is servicing a Mortgage Loan pursuant to a
      Subservicing Agreement, the Subservicer shall be required to establish and
      maintain a Subservicing Account which shall be an Eligible Account. The
      Subservicer shall be required to deposit into the Subservicing Account not
      later
      than the first Business Day after receipt all proceeds of Mortgage Loans
      received by the Subservicer, less its subservicing compensation to the extent
      permitted by the Subservicing Agreement, and to remit such proceeds to the
      Servicer for deposit in the Custodial Account not later than the tenth day
      of
      each month, or if such tenth day is not a Business Day, the immediately
      succeeding Business Day. For purposes of this Agreement, the Servicer shall
      be
      deemed to have received payments on the Mortgage Loans when the Subservicer
      has
      received such payments pursuant to the Subservicing Agreement.

     

    Section
      4.18 Permitted
      Investments.

     

    The
      Servicer may invest the funds in the Custodial Account in Permitted Investments,
      each of which shall mature not later than the Business Day immediately preceding
      the Remittance Date next following the date of such investment (except that
      if
      such Permitted Investment is an obligation of the institution that maintains
      such account, then such Permitted Investment shall mature not later than such
      Remittance Date) and shall not be sold or disposed of prior to its maturity.
      All
      such Permitted Investments shall be registered in the name of the Servicer
      or
      its nominee, and held in trust for Owner. All income and gain realized from
      any
      such investment as well as any interest earned on deposit in the Custodial
      Account shall be for the benefit of the Servicer, and shall be withdrawn by
      the
      Servicer on the related Remittance Date. The Servicer shall deposit in the
      Custodial Account (with respect to investments made hereunder of funds held
      therein) an amount equal to the amount of any loss incurred in respect of any
      such investment immediately upon realization of such loss without right of
      reimbursement.

     

    Section
      4.19 Payment
      of Taxes, Insurance and Other Charges; Maintenance of Primary Mortgage Insurance
      Policies; Collections Thereunder.

     

    With
      respect to each Mortgage Loan, the Servicer shall maintain accurate records
      reflecting the status of ground rents, taxes, assessments, water rates and
      other
      charges which are or may become a lien upon the Mortgaged Property and the
      status of Primary Mortgage Insurance Policy premiums and fire and hazard
      insurance coverage and shall obtain, from time to time, all bills for the
      payment of such charges, including renewal premiums, and shall effect payment
      thereof prior to the applicable penalty or termination date and at a time
      appropriate for securing maximum discounts allowable, employing for such purpose
      deposits of the Mortgagor in the Escrow Account which shall have been estimated
      and accumulated by the Servicer in amounts sufficient for such purposes, as
      allowed under the terms of the Mortgage and applicable law. If a Mortgage does
      not provide for Escrow Payments, then the Servicer shall require that any such
      payments be made by the Mortgagor at the time they first become due. The
      Servicer assumes full responsibility for the timely payment of all such bills
      and shall effect timely payments of all such bills irrespective of the
      Mortgagor’s faithful performance in the payment of same or the making of the
      Escrow Payments and shall make advances from its own funds to effect such
      payments but shall be entitled to reimbursement thereof in accordance with
      the
      terms of this Agreement.

     

    
      
        
        

      

      
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    The
      Servicer shall maintain in full force and effect a Primary Mortgage Insurance
      Policy, with respect to each Mortgage Loan for which such coverage is required.
      Such coverage will be maintained until the Loan-to-Value Ratio of the related
      Mortgage Loan is reduced to 75% or less in the case of a Mortgage Loan having
      a
      Loan-to-Value Ratio at origination in excess of 80% or until such time, if
      any,
      as such insurance is required to be released in accordance with the provisions
      of applicable law including, but not limited to, the Homeowners Protection
      Act
      of 1998. The Servicer shall assure that all premiums due under any Primary
      Mortgage Insurance Policy are paid in a timely manner, but, shall be entitled
      to
      reimbursement pursuant to the terms of this Agreement for premiums paid by
      the
      Servicer on behalf of any Mortgagor who is obligated to pay such premiums but
      fails to do so. The Servicer shall not cancel or refuse to renew any Primary
      Mortgage Insurance Policy in effect on the Funding Date that is required to
      be
      kept in force under this Agreement unless a replacement Primary Mortgage
      Insurance Policy for such canceled or nonrenewed policy is obtained from and
      maintained with an insurer. The Servicer shall not take any action which would
      result in noncoverage under any applicable Primary Mortgage Insurance Policy
      of
      any loss which, but for the actions of the Servicer, would have been covered
      thereunder.

     

    In
      connection with its activities as servicer, the Servicer agrees to prepare
      and
      present, on behalf of itself and the Owner, claims to the insurer under any
      Primary Mortgage Insurance Policy in a timely fashion in accordance with the
      terms of such policies and, in this regard, to take such action as shall be
      necessary to permit recovery under any Primary Mortgage Insurance Policy
      respecting a defaulted Mortgage Loan. Pursuant to Section 4.04, any amounts
      collected by the Servicer under any Primary Mortgage Insurance Policy shall
      be
      deposited in the Collection Account.

     

    Section
      4.20 Maintenance
      of Hazard Insurance.

     

    The
      Servicer shall cause to be maintained for each Mortgage Loan fire and hazard
      insurance with extended coverage as is customary in the area where the Mortgaged
      Property is located in an amount that is at least equal to the lesser of (a)
      the
      maximum insurable value of the improvements securing such Mortgage Loan and
      (b)
      the greater of (1) the Unpaid Principal Balance of such Mortgage Loan or (2)
      an
      amount such that the proceeds thereof shall be sufficient to prevent the
      Mortgagor and/or the loss payee from becoming a co insurer.

     

    
      
        
        

      

      
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    If
      any
      Mortgaged Property is in an area identified by the Federal Emergency Management
      Agency as having special flood hazards and such flood insurance has been made
      available, then the Servicer will cause to be maintained a flood insurance
      policy meeting the requirements of the current guidelines of the Federal
      Insurance Administration with a generally acceptable insurance carrier, in
      an
      amount representing coverage not less than the lesser of (a) the minimum amount
      required, under the terms of coverage, to compensate for any damage or loss
      on a
      replacement cost basis (or the outstanding principal balance of the related
      Mortgage Loan if replacement cost coverage is not available for the type of
      building insured) or (b) the maximum amount of insurance which is available
      under the Flood Disaster Protection Act of 1973, as amended (assuming that
      the
      area in which such Mortgaged Property is located is participating in such
      program).

     

    The
      Servicer shall also maintain on each REO Property fire, hazard and liability
      insurance, and to the extent required and available under the Flood Disaster
      Protection Act of 1973, as amended, flood insurance with extended coverage
      in an
      amount which is at least equal to the lesser of (a) the maximum insurable value
      of the improvements which are a part of such property and (b) the outstanding
      principal balance of the related Mortgage Loan at the time it became an REO
      Property plus accrued interest at the Mortgage Interest Rate and related
      Servicing Advances.

     

    ARTICLE
      V

     

    ADMINISTRATION
      AND SERVICING OF TRADING ACCOUNTS

     

    Section
      5.01 The
      Servicer to Service Trading Accounts. 

     

    (a) The
      Servicer represents and warrants that it will service and administer the Trading
      Accounts, in accordance with the terms of (i) the procedures it employs to
      administer Trading Accounts for its own benefit (as the same may be amended
      from
      time to time) and (ii) the related Additional Collateral Pledge
      Agreement.

     

    (b) The
      Servicer shall be released from its obligations to administer the Trading
      Accounts as applicable upon termination of the related Additional Collateral
      Pledge Agreement.

     

    (c) The
      Servicer may, without consent of Owner, amend or modify a Additional Collateral
      Pledge Agreement in any non-material respect to reflect administrative or
      account changes.

     

    (d) Notwithstanding
      anything to the contrary in this Agreement (including without limitation the
      termination of the Servicing rights and/or obligations of the Servicer under
      Article XI of this Agreement), the Servicer shall service and administer each
      Trading Account, each Additional Collateral Pledge Agreement and each Additional
      Collateral Mortgage Loan, in accordance with the terms of this Agreement and
      each Additional Collateral Pledge Agreement; it being understood and agreed
      that
      only the Servicer shall service and administer the related securities accounts,
      lines of credit, mortgages, and guarantors with respect to Additional Collateral
      Pledge Agreement.

     

    
      
        
        

      

      
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    (e) Notwithstanding
      Section 4.04, when the Collateral Base for any Additional Collateral Mortgage
      Loan is less than the Loan Amount for such Additional Collateral Mortgage Loan,
      the Servicer shall cause cash received upon exercise of foreclosure rights
      under
      the related Additional Collateral Pledge Agreement, if it has not been
      previously applied to reduce the principal balance of such Additional Collateral
      Mortgage Loan, to be deposited into the Custodial Account.

     

    (f) The
      Servicer shall use its reasonable efforts to realize upon any Additional
      Collateral for such of the Additional Collateral Mortgage Loans as come into
      and
      continue in default and as to which no satisfactory arrangements can be made
      for
      collection of delinquent payments; provided that the Servicer shall not obtain
      title to any such Additional Collateral as a result of or in lieu of the
      disposition thereof or otherwise; and provided further that (i) the Servicer
      shall not proceed with respect to such Additional Collateral in any manner
      that
      would impair the ability to recover against the related Mortgaged Property,
      and
      (ii) the Servicer shall proceed with any acquisition of REO Property in a manner
      that preserves the ability to apply the proceeds of such Additional Collateral
      against amounts owed under the defaulted Mortgage Loan. Any proceeds realized
      from such Additional Collateral (other than amounts to be released to the
      Mortgagor or the related guarantor in accordance with procedures that the
      Servicer would follow in servicing loans held for its own account, subject
      to
      the terms and conditions of the related Mortgage and Mortgage Note and to the
      terms and conditions of any security agreement, guarantee agreement, mortgage
      or
      other agreement governing the disposition of the proceeds of such Additional
      Collateral) shall be deposited in the Custodial Account, subject to withdrawal
      pursuant to Section 4.05 of this Agreement.

     

    Section
      5.02 Agreements
      with Respect to the Surety Bond. 

     

    (a) The
      Servicer represents and warrants to Owner that the Additional Collateral
      Mortgage Loans are insured under the terms and provisions of the Surety Bond,
      subject to the limitations set forth therein. Owner acknowledges receipt from
      the Surety Bond Issuer of a certificate confirming the insurance of the
      Additional Collateral Mortgage Loans pursuant to the terms and provisions of
      the
      Surety Bond.

     

    (b) Owner
      and
      the Servicer agree that the Surety Bond Issuer is a third party beneficiary
      in
      respect of the Servicer’s obligations under this Article V.

     

    (c) With
      respect to the sale or potential sale of the Additional Collateral Mortgage
      Loans, Owner shall not use, circulate, quote or otherwise refer to the Surety
      Bond Issuer or the Surety Bond for any purpose, including but not limited to,
      the registration, purchase and sale of securities, nor file the Surety Bond
      with, or refer to it or to the Surety Bond Issuer, as part of any registration
      statement or offering document, without the express prior written consent of
      the
      Surety Bond Issuer as to both form and substance of such
      disclosure.

     

    
      
        
        

      

      
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    ARTICLE
      VI

     

    PAYMENTS
      TO OWNER

     

    Section
      6.01 Distributions.

     

    On
      each
      Remittance Date with respect to each Mortgage Loan, subject to Section 6.03(c),
      the Servicer shall distribute to Owner (i) all amounts due on the Due Date
      immediately preceding the related Remittance Date (which shall include all
      scheduled interest and principal), net of charges against or withdrawals from
      the Custodial Account pursuant to clauses (ii) through (vi) of Section 4.05,
      plus any principal prepayments received during the related Principal Prepayment
      Period, minus (iii) any amounts attributable to Monthly Payments collected
      as to
      such Mortgage Loans but due on a Due Date or Due Dates subsequent to the current
      Remittance Date.

     

    Subject
      to Section 6.03(c), all distributions made to Owner on each Remittance Date
      will
      be made to Owner of record on the preceding Record Date, and shall be based
      on
      the Mortgage Loans owned and held by Owner, and shall be made by wire transfer
      of immediately available funds to the account of Owner at a bank or other entity
      having appropriate facilities therefor, or if Owner shall have so notified
      the
      Servicer, by check mailed to the address of Owner as provided for in Section
      12.06.

     

    With
      respect to any remittance received by Owner on or after the second Business
      Day
      following the Business Day on which such payment was due, the Servicer shall
      pay
      to Owner interest on any such late payment at an annual rate equal to the rate
      of interest as is publicly announced from time to time at its principal office
      by Chase Manhattan Bank, N. A., New York, New York, as its “prime” lending rate
      (which is not necessarily its lowest rate) (or if Chase Manhattan Bank, N.A.
      shall cease to exist or to announce such rate, then such rate shall be a
      reasonably comparable rate determined by Servicer in its reasonable discretion),
      adjusted as of the date of each change, plus one (1) percentage point, but
      in no
      event greater than the maximum amount permitted by applicable law. Such interest
      shall be paid by the Servicer to Owner on the date such late payment is made
      and
      shall cover the period commencing with the day following such second Business
      Day and ending with the Business Day on which such payment is made, both
      inclusive. Such interest shall be remitted along with such late payment. The
      payment by the Servicer of any such interest shall not be deemed an extension
      of
      time for Payment or a waiver of any Event of Default by the
      Servicer.

     

    Section
      6.02 Statements
      to Owner.

     

    Not
      later
      than the tenth (10th) day of each month, the Servicer will furnish to Owner
      a
      monthly remittance report in a format substantially similar to Exhibit B hereto,
      which monthly remittance report will be generated as of the expiration of the
      preceding month.

     

    The
      Servicer shall provide Owner with such information concerning the Mortgage
      Loans
      as is necessary for Owner to prepare its federal income tax return as Owner
      may
      reasonably request from time to time.

     

    Section
      6.03 Monthly
      Advances by the Servicer.

     

    (a) With
      respect to each Mortgage Loan and subject to Section 6.03(c), on each Remittance
      Date the Servicer shall, pursuant to Section 6.01, remit to Owner the total
      of
      all scheduled Monthly Payments due on the preceding Due Date whether or not
      such
      Monthly Payments were collected from the Mortgagor. Any amounts which are due
      but uncollected shall, subject to subsection (c) below, be funded only by using
      excess cash collections, if any, on deposit in the Custodial
      Account.

     

    
      
        
        

      

      
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    (b) If
      the
      collections on deposit in the Custodial Account on the Remittance Date are
      less
      than the amount of the required monthly remittance, the Servicer shall, subject
      to subsection (c) below, make a Monthly Advance by depositing to the Custodial
      Account enough of its own funds to make the total on deposit equal the full
      amount of the remittance due Owner. The Servicer may reimburse itself for its
      advances from collections from Mortgagors that are subsequently deposited into
      the Custodial Account to the extent provided in Section 4.05.

     

    (c) If
      the
      Servicer determines, in its reasonable judgment, that any uncollected payment
      due from a Mortgagor that is due to be paid to Owner pursuant to Section 6.01
      would not be recoverable from Liquidation Proceeds or other payments or
      recoveries (including Insurance Proceeds or Condemnation Proceeds) on the
      related Mortgage Loan, then the Servicer will ensure that the amount considered
      to be non-recoverable will not be funded from excess collections or advanced
      by
      the Servicer, and will therefore not be remitted to Owner until the earlier
      to
      occur of (a) the purchase of the Mortgage Loan by the Servicer, if applicable,
      or (b) the acquisition or disposition of title to the related Mortgaged Property
      through foreclosure or otherwise, and then in each case shall only be paid
      to
      the extent of such repurchase price or recovery.

     

    (d) The
      Servicer’s obligations to make Monthly Advances as to any Mortgage Loan pursuant
      to Section 6.03(a) and (b) will continue through the last Monthly Payment due
      prior to the payment in full of the Mortgage Loan, or through the Remittance
      Date for the remittance of all Liquidation Proceeds or other payments or
      recoveries (including Insurance Proceeds or Condemnation Proceeds) with respect
      to the related Mortgage Loan or the related REO Property, subject to Section
      6.03(c). With respect to any Mortgage Loans determined to be unrecoverable
      and
      whose Monthly Payments are omitted from the scheduled monthly remittance, the
      Servicer shall deliver an Officer’s Certificate to Owner setting forth the basis
      of such determination.

     

    Section
      6.04 Compensating
      Interest.

     

    Not
      later
      than the close of business on the Business Day preceding each Remittance Date,
      the Servicer shall from its own funds deposit in the Custodial Account an amount
      equal to the lesser of (i) the aggregate of the Prepayment Interest Shortfalls,
      if any, that exist in respect of the related Principal Prepayment Period and
      (ii) the aggregate of the Servicing Fees for the most recently ended calendar
      month.

     

    If
      for
      any reason the Servicer fails to process any principal prepayment on a timely
      basis in accordance with Section 4.04(i), the Servicer shall from its own funds
      deposit in the Custodial Account, interest at the Mortgage Interest Rate on
      the
      principal prepayment for the period the deposit into the Custodial Account
      was
      delayed.

     

    
      
        
        

      

      
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    ARTICLE
      VII

     

    GENERAL
      SERVICING PROCEDURE

     

    Section
      7.01 Assumption
      Agreements.

     

    If
      the
      Servicer acquires actual knowledge that a Mortgagor has transferred or proposes
      to transfer the related Mortgaged Property, the Servicer shall enforce any
      related “due-on-sale” clause consistent with its practices for mortgage loans it
      services for its own account. If the Servicer elects not to enforce such
      due-on-sale clause, the Servicer may enter into an assumption agreement with
      the
      party to whom such Mortgaged Property is to be or has been conveyed. If any
      assumption fee is collected by the Servicer for entering into an assumption
      agreement, the Servicer shall be entitled to retain a portion of such fee up
      to
      an amount equal to 1% of the outstanding principal balance of the related
      Mortgage Loan as additional servicing compensation, and shall deposit into
      the
      Custodial Account any portion thereof that exceeds 1% of such outstanding
      principal balance.

     

    Section
      7.02 Satisfaction
      of Mortgages and Release of Mortgage Files.

     

    Upon
      the
      payment in full of any Mortgage Loan and deposit of such payment by Servicer
      into the Custodial Account pursuant to Section 4.04, the Servicer shall execute
      any document necessary to satisfy the Mortgage Loan and request delivery to
      it
      of the portion of the Mortgage File held by Owner or the Custodian. Upon receipt
      of such request, the related mortgage documents shall be released to the
      Servicer within seventy-two (72) hours and the Servicer shall prepare and
      process any satisfaction or release. No expense incurred in connection with
      any
      instrument of satisfaction or deed of reconveyance shall be chargeable to the
      Custodial Account or Owner.

     

    To
      the
      extent that Owner acts as its own custodian, from time to time and as
      appropriate for the servicing or foreclosure of the Mortgage Loan, including
      for
      this purpose collection under any Primary Mortgage Insurance Policy, Owner
      shall, upon request of the Servicer and delivery to Owner of a servicing receipt
      signed by a Servicing Officer, release the requested portion of the Mortgage
      File held by Owner to the Servicer. Owner shall promptly deliver the request
      to
      return the related Mortgage documents to the Custodian. The Servicer shall
      return the Mortgage documents to Owner when the need therefor by the Servicer
      no
      longer exists, unless the Mortgage Loan has been liquidated and the Liquidation
      Proceeds relating to the Mortgage Loan have been deposited into the Custodial
      Account or the Mortgage File or such document has been delivered to an attorney,
      or to a public trustee or other public official as required by law, for purposes
      of initiating or pursuing legal action or other proceedings for the foreclosure
      of the Mortgaged Property either judicially or non-judicially. Upon receipt
      of a
      certificate of a Servicing Officer stating that such Mortgage Loan was
      liquidated, the servicing receipt shall be released by Owner to the
      Servicer.

     

    Section
      7.03 Servicing
      Compensation.

     

    In
      addition to any other fees to which Servicer is entitled hereunder, as
      compensation for its services hereunder, the Servicer shall be entitled to
      a
      Servicing Fee payable with respect to each Mortgage Loan. As to each Mortgage
      Loan, the Servicing Fee shall (i) be payable monthly from payment of interest
      on
      such Mortgage Loan prior to the deposit of such payments into the Custodial
      Account, (ii) accrue at the applicable Servicing Fee Rate, and (iii) be computed
      on the basis of the same principal amount and for the same period respecting
      which such interest payment was computed. The Servicer shall be entitled to
      recover accrued but unpaid Servicing Fees in respect of any Mortgage Loan to
      the
      extent permitted by Section 4.05. The Servicer’s right to the Servicing Fee
      shall not be transferred in whole or in part except in connection with the
      transfer of all the Servicer’s obligations under this Agreement. Servicing
      compensation in addition to the Servicing Fee, in the form of assumption fees
      as
      provided in Section 7.01, interest paid on funds deposited in the Escrow Account
      to the extent permitted by Section 4.06, default interest in excess of the
      Mortgage Interest Rate and late payment charges and other ancillary fees, in
      each case to the extent collected, shall be retained by the Servicer and shall
      not be required to be deposited into the Custodial Account. The Servicer shall
      be required to pay all expenses incurred by it in connection with its servicing
      activities hereunder and shall not be entitled to reimbursement therefor except
      as specifically provided for herein.

     

    
      
        
        

      

      
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    Section
      7.04 Annual
      Statement as to Compliance and Attestation. 

     

    (a) Unless
      an
      Annual Statement as to Compliance is delivered as provided in Section 13.04,
      the
      Servicer will deliver to Owner on or before April 1 of each year, beginning
      with
      April 1 of the calendar year after the year in which the first Closing Date
      occurs, an Officer’s Certificate stating that (i) a review of the activities of
      the Servicer during the preceding calendar year and of performance under this
      Agreement has been made under such officer’s supervision, and (ii) to such
      officer’s knowledge, based on such review, the Servicer has fulfilled all of its
      material obligations under this Agreement throughout such year in all material
      respects, or, if there has been a default in the fulfillment of any such
      obligation, specifying each such default known to such officer and the nature
      and status thereof.

     

    (b) Unless
      a
      Report on Assessment of Compliance and Attestation is delivered as provided
      in
      Section 13.05, on or before April 1 of each year, beginning with April 1 of
      the
      calendar year after the year in which the first Closing Date occurs, the
      Servicer at its expense shall cause a firm of independent certified public
      accountants (which may also render other services to the Servicer) to furnish
      a
      report to Owner to the effect that certain mortgage loans serviced by the
      Servicer were included in the total population of Mortgage Loans subject to
      selection for testing in such firm’s examination of certain documents and
      records, that such examination was conducted substantially in compliance with
      the Uniform Single Attestation Program for Mortgage Bankers and that such
      examination disclosed no items of material noncompliance with the provisions
      of
      the Uniform Single Attestation Program for Mortgage Bankers, except for such
      items of noncompliance as shall be set forth in such report.

     

    Section
      7.05 Owner’s
      Right to Examine the Servicer Records .

     

    Owner
      shall have the right to examine and audit upon reasonable prior written notice,
      during business hours or at such other times as might be reasonable under
      applicable circumstances, any and all of the books, records, documentation
      or
      other information of the Servicer, or held by another for the Servicer or on
      its
      behalf or otherwise, which may be relevant to the performance or observance
      by
      the Servicer of the terms, covenants or conditions of this
      Agreement.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    The
      Servicer shall provide to Owner and any supervisory agents or examiners which
      may relate to Owner access to any documentation regarding the Mortgage Loans
      which may be required by all applicable regulations. Such access shall be
      afforded without charge, upon reasonable request, during normal business hours
      and at the offices of the Servicer.

     

    Neither
      Owner nor the Servicer shall, nor will they permit any of their respective
      affiliates, employees, agents or representatives to, divulge or disclose,
      directly or indirectly, any information concerning the Mortgage Loans in
      violation of any law. Neither party shall, nor shall they permit any of their
      respective affiliates, employees, agents or representatives to, divulge or
      disclose, directly or indirectly, any information concerning the business
      practices of the other party to this Agreement. This paragraph does not apply
      to
      information which is not confidential or which has been published or otherwise
      made available to the general public prior to the date of this Agreement, or
      information required to be released under law or by or to any regulatory,
      administrative or judicial body or agency or the furnishing by either party
      of
      information to their respective affiliates, auditors, or attorneys.

     

    ARTICLE
      VIII

     

    REPORTS
      TO BE PREPARED BY SERVICER

     

    Section
      8.01 The
      Servicer Shall Provide Information as Reasonably
      Required.

     

    During
      the term of this Agreement the Servicer shall furnish any reports, or
      documentation that Owner may reasonably request. Reports requested may include
      reports not specified or otherwise required by this Agreement, for example,
      reports with respect to REO Properties, or reports required to comply with
      any
      regulations regarding any supervisory agents or examiners of Owner. All reports
      will be delivered in accordance with Owner’s reasonable instructions and
      directions. If the reports or other information requested will require the
      Servicer to incur additional costs or expenses outside of its normal servicing
      procedures, Owner agrees to reimburse the Servicer for those costs and expenses.
      The Servicer agrees to execute and deliver all such instruments and take all
      such action as Owner, from time to time, may reasonably request in order to
      effectuate the purpose and to carry out the terms of this
      Agreement.

     

    ARTICLE
      IX

     

    THE
      SERVICER

     

    Section
      9.01 Indemnification;
      Third Party Claims.

     

    (a) Each
      party hereto agrees to indemnify the other party and hold it harmless against
      any and all claims, losses, penalties, fines, forfeitures, legal fees and
      related costs, judgments, and any other costs, fees and expenses that the other
      party may sustain in any way related to the breach of such party in performing
      its duties and obligations under this Agreement.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    (b) The
      Servicer shall (i) promptly notify Owner if a material claim is made by any
      party with respect to this Agreement or the Mortgage Loans, (ii) assume the
      defense of any such claim and pay all expenses in connection therewith,
      including attorneys’ fees, and (iii) promptly pay, discharge and satisfy any
      judgment or decree which may be entered against it or Owner in respect of such
      claim. The Servicer shall follow any written instructions received from Owner
      in
      connection with such claim. Owner shall promptly reimburse the Servicer for
      all
      amounts paid or advanced by it pursuant to the preceding sentence, except as
      to
      amounts as to which the Servicer is required to indemnify Owner pursuant to
      Section 3.01.

     

    Section
      9.02 Merger
      or Consolidation of the Servicer.

     

    The
      Servicer will keep in full effect its existence, rights and franchises as a
      corporation, and will obtain and preserve its qualification to do business
      as a
      foreign corporation in each jurisdiction in which such qualification is or
      shall
      be necessary to protect the validity and enforceability of this Agreement,
      or
      any of the Mortgage Loans and to perform its duties under this Agreement. Any
      Person into which the Servicer may be merged or consolidated, or any corporation
      resulting from any merger, conversion or consolidation to which the Servicer
      shall be a party, or any Person succeeding to the business of the Servicer,
      shall be the successor of the Servicer hereunder, without the execution or
      filing of any paper or any further act on the part of any of the parties hereto,
      anything herein to the contrary notwithstanding.

     

    Section
      9.03 Limitation
      on Liability of the Servicer and Others.

     

    Neither
      the Servicer nor any of the officers, employees or agents of the Servicer shall
      be under any liability to Owner for any action taken or for refraining from
      the
      taking of any action in good faith pursuant to this Agreement, or for errors
      in
      judgment; provided, however, that this provision shall not protect the Servicer
      or any such person against any breach of warranties or representations made
      herein, or failure to perform its obligations substantially in accordance with
      any standard of care set forth in this Agreement, or any liability which would
      otherwise be imposed by reason of any breach of the terms and conditions of
      this
      Agreement. The Servicer and any officer, employee or agent of the Servicer
      may
      rely in good faith on any document of any kind appearing to be properly executed
      and submitted by any Person respecting any matters arising hereunder. The
      Servicer shall not be under any obligation to appear in, prosecute or defend
      any
      legal action which is not incidental to its duties to service the Mortgage
      Loans
      in accordance with this Agreement and which in its opinion may involve it in
      any
      expenses or liability; provided, however, that the Servicer may, with the
      consent of Owner, undertake any such action which it may deem necessary or
      desirable in respect to this Agreement and the rights and duties of the parties
      hereto. In such event, the legal expenses and costs of such action and any
      liability resulting therefrom shall be expenses, costs and liabilities for
      which
      Owner will be liable. The Servicer shall be entitled to be reimbursed therefor
      from Owner upon written demand.

     

    Section
      9.04 The
      Servicer Not to Resign.

     

    Subject
      to Section 12.04, the Servicer shall not resign from the obligations and duties
      hereby imposed on it except (i) by mutual consent of the Servicer and Owner,
      (ii) upon the determination that its duties hereunder are no longer permissible
      under applicable law and such incapacity cannot be cured by the Servicer (any
      such determination permitting the resignation of the Servicer shall be evidenced
      by an opinion of counsel to such effect delivered to Owner), (iii) following
      any
      breach of this Agreement by Owner, or (iv) in connection with a sale of
      substantially all of the assets of the Servicer. No such resignation shall
      become effective until a successor shall have assumed the Servicer’s
      responsibilities and obligations hereunder in the manner provided in Section
      12.01.

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      X

     

    DEFAULT

     

    Section
      10.01 Events
      of Default.

     

    If
      one or
      more of the following “Events of Default” by the Servicer shall occur and be
      continuing.

     

    
      	 	
              (i)

            	
              any
                failure by the Servicer to remit to Owner any payment required to
                be made
                under the terms of this Agreement which continues unremedied for
                a period
                (3) Business Days after the date on which written notice of such
                failure,
                requiring the same to be remedied, shall have been given to the Servicer
                by Owner; or

            


    

     

    
      	 	
              (ii)

            	
              failure
                on the part of the Servicer duly to observe or perform in any material
                respect any other of the covenants or agreements on the part of the
                Servicer set forth in this Agreement which continues unremedied for
                a
                period of thirty (30) days (except that such number of days shall
                be
                fifteen (15) in the case of a failure to pay any premium for any
                insurance
                policy required to be maintained under this Agreement) after the
                date on
                which written notice of such failure, requiring the same to be remedied,
                shall have been given to the Servicer by Owner;
                or

            


    

     

    
      	 	
              (iii)

            	
              a
                decree or order of a court or agency or supervisory authority having
                jurisdiction for the appointment of a conservator receiver or liquidator
                in any insolvency, readjustment of debt, marshaling of assets and
                liabilities or similar proceedings, or for the winding-up or liquidation
                of its affairs, shall have been entered against the Servicer and
                such
                decree or order shall have remained in force undischarged or unstayed
                for
                a period of sixty (60) days; or

            


    

     

    
      	 	
              (iv)

            	
              the
                Servicer shall consent to the appointment of a conservator, receiver
                or
                liquidator in any insolvency, readjustment of debt, marshaling of
                assets
                and liabilities or similar proceedings of or relating to the Servicer
                or
                of or relating to all or substantially all of its property;
                or

            


    

     

    
      	 	
              (v)

            	
              the
                Servicer shall admit in writing its inability to pay its debts generally
                as they become due, file a petition to take advantage of any applicable
                insolvency or reorganization statute, make an assignment for the
                benefit
                of its creditors, or voluntarily suspend payment of its obligations;
                or

            


    

     

    
      	 	
              (vi)

            	
              the
                Servicer ceases to be eligible to sell Mortgage Loans to and service
                Mortgage Loans for Fannie Mae and Freddie Mac, and continues to be
                ineligible to sell Mortgage Loans to and service Mortgage Loans for
                Fannie
                Mae and Freddie Mac for a period of sixty (60) days after the date
                on
                which written notice of such ineligibility shall have been given
                to the
                Servicer by Fannie Mae and Freddie
                Mac;

            


    

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    then,
      and
      in each and every such case, so long as an Event of Default shall not have
      been
      remedied, Owner, by notice in writing to the Servicer, in addition to whatever
      rights Owner may have at law or in equity to damages, including injunctive
      relief and specific performance, may terminate all the rights and obligations
      of
      the Servicer under this Agreement and in and to the Mortgage Loans and the
      proceeds thereof other than, with respect to any Additional Collateral Mortgage
      Loan, the obligation to administer the related Additional Collateral Pledge
      Agreement. On or after the receipt by the Servicer of such written notice,
      (i)
      all authority and power of the Servicer under this Agreement, whether with
      respect to the Mortgage Loans or otherwise, shall pass to and be vested in
      the
      successor appointed pursuant to Section 12.01, except with respect to any
      related Additional Collateral Pledge Agreement, and (ii) upon further written
      request from Owner, the Servicer shall prepare, execute and deliver, any and
      all
      documents and other instruments, deliver to the successor all Mortgage Files,
      and do or accomplish all other acts or things necessary or appropriate to effect
      the purposes of such notice of termination, including the transfer and
      endorsement or assignment of the Mortgage Loans and related documents, or
      otherwise, at the Servicer’s sole expense. The Servicer agrees to cooperate with
      Owner and such successor in effecting the termination of the Servicer’s
      responsibilities and rights hereunder as provided above, including, without
      limitation, the transfer to such successor for administration by it of all
      cash
      amounts which shall at the time be credited by the Servicer to the Custodial
      Account or Escrow Account or thereafter received with respect to the Mortgage
      Loans.

     

    Section
      10.02 Waiver
      of Defaults.

     

    Owner
      may
      waive any default by the Servicer in the performance of its obligations
      hereunder and its consequences. Upon any such waiver of a past default, such
      default shall cease to exist, and any Event of Default arising therefrom shall
      be deemed to have been remedied for every purpose of this Agreement. No such
      waiver shall extend to any subsequent or other default or impair any right
      consequent thereon except to the extent expressly so waived.

     

    ARTICLE
      XI

     

    TERMINATION;
      REPURCHASE

     

    Section
      11.01 Termination.

     

    The
      respective obligations and responsibilities of the Servicer shall terminate
      upon
      the latest to occur of: (i) the final payment or other liquidation (or any
      advance with respect thereto) of the last Mortgage Loan or the disposition
      of
      all REO Property and the remittance of all funds due hereunder, (ii) the date
      agreed upon by mutual consent of the Servicer and Owner in writing, (iii) the
      repurchase by the Servicer of all of the Mortgage Loans subject to this
      Agreement, pursuant to Section 11.02, or (iv) a resignation permitted by Section
      9.04 hereof.

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    Section
      11.02 Repurchase.

     

    At
      the
      sole option of the Servicer and upon thirty (30) days prior written notice
      to
      Owner, if the aggregate outstanding principal balance of all Mortgage Loans
      subject to this Agreement which have not been written off as non-performing
      assets shall be less than ten percent (10%) of the aggregate Purchase Price
      paid
      for such Mortgage Loans, the Servicer may repurchase all such outstanding
      Mortgage Loans; provided, however, that if such Mortgage Loans are included
      in a
      REMIC, the Servicer agrees not to exercise its right to repurchase unless and
      until such right can be exercised in conjunction with a “qualified liquidation”
(as defined in Section 860F(a)(4) of the Code) of such REMIC, as advised by
      Owner. Such repurchase by the Servicer of such Mortgage Loans and all related
      REO Property shall be at a price equal to 100% of the outstanding principal
      balance of each Mortgage Loan on the day of repurchase, plus accrued and unpaid
      interest thereon at the Mortgage Loan Remittance Rate to the first day of the
      calendar month following repurchase, plus the appraised value of any such REO
      Property determined at the expense of the Servicer by an appraiser mutually
      agreed upon by the Servicer and Owner.

     

    ARTICLE
      XII

     

    MISCELLANEOUS
      PROVISIONS

     

    Section
      12.01 Successor
      to the Servicer.

     

    Prior
      to
      termination of the Servicer’s responsibilities and duties under this Agreement
      pursuant to Sections 9.04, 10.01, 11.01 or 12.04, Owner shall (i) succeed to
      and
      assume all of the Servicer’s responsibilities, rights, duties and obligations
      under this Agreement, or (ii) appoint a successor who is a Fannie Mae/Freddie
      Mac approved servicer having a net worth of not less than $15,000,000 and which
      shall succeed to all rights and assume all of the responsibilities, duties
      and
      liabilities of the Servicer under this Agreement prior to the termination of
      the
      Servicer’s responsibilities, duties and liabilities under this
      Agreement.

     

    In
      connection with such appointment and assumption, Owner may make such
      arrangements for the compensation of such successor out of payments on Mortgage
      Loans as it and such successor shall agree. In the event that the Servicer’s
      duties, responsibilities and liabilities under this Agreement should be
      terminated pursuant to one of the aforementioned Sections, the Servicer shall
      discharge such duties and responsibilities during the period from the date
      it
      acquires knowledge of such termination until the effective date thereof with
      the
      same degree of diligence and prudence which it is obligated to exercise under
      this Agreement, and shall take no action whatsoever that might materially impair
      or prejudice the rights or financial condition of its successor. The resignation
      or removal of the Servicer pursuant to the aforementioned Sections shall not
      become effective until a successor shall be appointed pursuant to this Section
      and shall in no event relieve the Servicer of the representations and warranties
      previously made pursuant to Section 3.01 hereof or Section 5 of the Purchase
      Agreement and the remedies available to Owner with respect thereto hereunder
      and
      thereunder.

     

    Any
      successor appointed as provided in this Section 12.01 shall execute, acknowledge
      and deliver to the Servicer and to Owner an instrument accepting such
      appointment, whereupon such successor shall become fully vested with all the
      rights, powers, duties, responsibilities, obligations and liabilities of the
      Servicer, with like effect as if originally named as a party to this Agreement.
      Any termination or resignation of the Servicer or termination of this Agreement
      pursuant to Section 9.04, 10.01, 11.01, or 12.04 shall not affect any claims
      that Owner may have against the Servicer arising prior to any such termination
      or resignation.

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    The
      Servicer shall in a timely and reasonable manner deliver to the successor the
      funds in the Custodial Account and the Escrow Account and the Mortgage Files
      and
      related documents and statements held by it hereunder and the Servicer shall
      account for all funds. The Servicer shall execute and deliver such instruments
      and do such other things all as may reasonably be required to more fully and
      definitely vest and confirm in the successor all such rights, powers, duties
      and
      responsibilities of the Servicer. The successor shall make arrangements as
      it
      may deem appropriate to reimburse the Servicer for amounts the Servicer actually
      expended pursuant to this Agreement which the Servicer is entitled to retain
      hereunder and which would otherwise have been reimbursable to the Servicer
      pursuant to this Agreement but for the appointment of the successor
      servicer.

     

    Section
      12.02 Amendment.

     

    This
      Agreement may be amended from time to time by the Servicer and Owner only by
      written agreement signed by the Servicer and Owner. Neither this Agreement
      nor
      any term hereof may be changed, waived, discharged or terminated orally, but
      only by an instrument in writing signed by the party against whom enforcement
      of
      the change, waiver, discharge or termination is sought.

     

    Section
      12.03 Assignments.

     

    Except
      as
      required under the Purchase Agreement or by applicable law, the Assignments
      shall not be recorded by Seller. The Owner may, at its option and expense
      (including all recordation fees), prepare and record any Assignment of
      Mortgage.

     

    Section
      12.04 Assignment
      of Servicing Rights .

     

    The
      Servicer may assign the servicing rights with respect to the Mortgage Loans
      upon
      the written consent of Owner, which consent shall not be unreasonably withheld
      or delayed; provided, however, the Servicer may, without the consent of Owner
      enter into one or more Subservicing Agreements relating to the Mortgage Loans;
      further provided, however that notwithstanding any subservicing arrangement,
      the
      Servicer shall remain liable to Owner for all obligations and responsibilities
      set forth in this Agreement.

     

    Section
      12.05 Governing
      Law.

     

    This
      Agreement is to be governed by, and construed in accordance with, the internal
      laws (as compared to conflicts of law provisions) of the State of
      Illinois.

     

    Section
      12.06 Notices.

     

    Any
      notices, consents or other communications permitted or required hereunder shall
      be in writing and shall be deemed conclusively to have been duly given if
      personally delivered, sent by overnight courier, or mailed by registered mail,
      postage prepaid, and return receipt requested, or transmitted by telex or
      telegraph and confirmed by a similar mailed writing, or otherwise received,
      if
      to Owner, addressed to Owner at One Belvedere Place, Suite 310, Mill Valley,
      California 94941, Attention:
      [              
  ], fax number
      [                   
], or to such other address as Owner may designate in writing to the Servicer;
      if to the Servicer, addressed to the Servicer at at 2500 Lake Cook Road,
      Riverwoods, Illinois 60015, Attention: Senior Vice President, fax number [(___)
      ___-____], with a copy to Scott de la Vega, Vice President, Morgan Stanley-Law
      Division, 1585 Broadway, New York, New York 10036, fax number (646) 290-2606,
      or
      to such other address as the Servicer may have designated in writing to Owner
      and Guarantor; and, if to Guarantor, addressed to Guarantor at One Belvedere
      Place, Suite 300, Mill Valley, California 94941, Attention: [ ], fax number
      [ ],
      or to such other address as Guarantor may designate in writing to the
      Servicer.

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

    Section
      12.07 Severability
      Provisions.

     

    Any
      part,
      provision, representation or warranty of this Agreement that is prohibited
      or
      unenforceable or is held to be void or unenforceable in any jurisdiction shall
      be ineffective, in such jurisdiction, to the extent of such prohibition or
      unenforceability without invalidating the remaining provisions hereof, and
      any
      such prohibition or unenforceability in any jurisdiction as to any Mortgage
      Loan
      shall not invalidate or render unenforceable such provision in any other
      jurisdiction.

     

    Section
      12.08 Exhibits.

     

    The
      exhibits to this Agreement are hereby incorporated and made a part hereof and
      are an integral part of this Agreement.

     

    Section
      12.09 General
      Interpretive Principles.

     

    For
      purposes of this Agreement, except as otherwise expressly provided or unless
      the
      context otherwise requires:

     

    
      	 	
              (i)

            	
              the
                terms defined in this Agreement have the meanings assigned to them
                in this
                Agreement and include the plural as well as the singular, and the
                use of
                any gender herein shall be deemed to include the other
                gender;

            


    

     

    
      	 	
              (ii)

            	
              accounting
                terms not otherwise defined herein have the meanings assigned to
                them in
                accordance with generally accepted accounting
                principles;

            


    

     

    
      	 	
              (iii)

            	
              references
                herein to “Articles,” “Sections,” “Subsections,” “Paragraphs,” and other
                subdivisions without reference to a document are designated Articles,
                Sections, Subsections, Paragraphs and other subdivisions of this
                Agreement;

            


    

     

    
      	 	
              (iv)

            	
              a
                reference to a Subsection without further reference to a Section
                is a
                reference to such Subsection as contained in the same Section in
                which the
                reference appears, and this rule shall also apply to Paragraphs and
                other
                subdivisions;

            


    

     

    
      	 	
              (v)

            	
              (he
                words “herein,” “hereof,” “hereunder” and other words of similar import
                refer to this Agreement as a whole and not to any particular provision;
                and

            


    

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (vi)

            	
              the
                terms “include” or “including” shall mean without limitation by reason of
                enumeration.

            


    

     

    Section
      12.10 Reproduction
      of Documents.

     

    This
      Agreement and all documents relating thereto, including, without limitation,
      (i)
      consents, waivers and modifications which may hereafter be executed, (ii)
      documents received by any party at the closing, and (iii) financial statements,
      certificates and other information previously or hereafter furnished, may be
      reproduced by any photographic, photostatic, microfilm, microcard, miniature
      photographic or other similar process. The parties agree that any such
      reproduction shall be admissible in evidence as the original itself in any
      judicial or administrative proceeding, whether or not the original is in
      existence and whether or not such reproduction was made by a party in the
      regular course of business, and that any enlargement, facsimile or further
      reproduction of such reproduction shall likewise be admissible in
      evidence.

     

    Section
      12.11 Successors
      and Assigns.

     

    The
      provisions of this Agreement shall be binding upon and inure to the benefit
      of
      the respective successors and permitted assigns of the parties
      hereto.

     

    Section
      12.12 Counterparts.

     

    This
      Agreement may be executed in several counterparts, each of which shall
      constitute an original, but all of which together, shall constitute one
      instrument notwithstanding that all parties are not signatories to the same
      counterparts.

     

    Section
      12.13 Non-Solicitation.

     

    (a) From
      and
      after the Closing Date, the Servicer agrees that it will not take any action
      or
      cause any action to be taken by its agents to solicit the Mortgagor under any
      Mortgage Loan to refinance a Mortgage Loan, in whole or in part, without the
      prior written consent of Owner. It is understood and agreed that promotions
      for
      refinance undertaken by the Servicer or its agents that are directed to segments
      of the general public, or to all or segments of the clients of Morgan Stanley
      Inc. and its affiliates which may include Mortgagors under any Mortgage Loan,
      including, without limitation, directed marketing solicitations, newspaper,
      radio and television advertisements, shall not constitute a solicitation under
      the terms of this Agreement, provided that no segment shall consist exclusively
      of such Mortgagors.

     

    (b) From
      and
      after the Closing Date, Owner agrees that it will not take any action or cause
      any action to be taken by its agents to solicit the Mortgagor under any Mortgage
      Loan for any purpose, or otherwise directly contact any such Mortgagor, without
      the prior written consent of the Servicer. It is understood and agreed that
      promotions undertaken by Owner or its agents that are directed to segments
      of
      the general public, or to all or segments of the clients of Owner or its
      affiliates, which may include Mortgagors under any Mortgage Loan, including,
      without limitation, directed marketing solicitations, newspaper, radio and
      television advertisements, shall not constitute a solicitation under the terms
      of this Agreement, provided that no segment shall consist primarily of such
      Mortgagors.

     

    
      
        
        

      

      
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    Section
      12.14 Guaranty
      of Owner’s Obligations.

     

    Guarantor
      hereby agrees to cause RWT Holdings, Inc. to perform all of its duties and
      obligations as Owner hereunder, guaranties the timely performance of such duties
      and obligations by RWT Holdings, Inc. and agrees to be jointly and severally
      liable to Seller for all such duties and obligations of RWT Holdings,
      Inc.

     

    ARTICLE
      XIII

     

    COMPLIANCE
      WITH REGULATION AB

     

    Section
      13.01 Intent
      of the Parties; Reasonableness.

     

    The
      Owner
      and the Servicer acknowledge and agree that the purpose of Article XIII of
      this
      Agreement is to facilitate compliance by the Owner and any Depositor with the
      provisions of Regulation AB and related rules and regulations of the Commission.
      Although Regulation AB is applicable by its terms only to offerings of
      asset-backed securities that are registered under the Securities Act, the
      Servicer acknowledges that investors in privately offered securities may require
      that the Owner or any Depositor provide comparable disclosure in unregistered
      offerings. References in this Agreement to compliance with Regulation AB include
      provision of comparable disclosure in private offerings.

     

    Neither
      the Owner nor any Depositor shall exercise its right to request delivery of
      information or other performance under these provisions other than in good
      faith, or for purposes other than compliance with the Securities Act, the
      Exchange Act and the rules and regulations of the Commission thereunder (or
      the
      provision in a private offering of disclosure comparable to that required under
      the Securities Act). The Servicer acknowledges that interpretations of the
      requirements of Regulation AB may change over time, whether due to interpretive
      guidance provided by the Commission or its staff, consensus among participants
      in the asset-backed securities markets, advice of counsel, or otherwise, and
      agrees to comply with requests made by the Owner or any Depositor in good faith
      for delivery of information under these provisions on the basis of evolving
      interpretations of Regulation AB. In connection with any Securitization
      Transaction, the Servicer shall cooperate fully with the Owner to deliver to
      the
      Owner (including any of its assignees or designees), any Master Servicer and
      any
      Depositor, any and all statements, reports, certifications, records and any
      other information necessary in the good faith determination of the Owner, any
      Master Servicer or any Depositor to permit the Owner, such Master Servicer
      or
      such Depositor to comply with the provisions of Regulation AB, together with
      such disclosures relating to the Servicer, any Subservicer and the Mortgage
      Loans, or the servicing of the Mortgage Loans, reasonably believed by the Owner
      or any Depositor to be necessary in order to effect such
      compliance.

     

    The
      Owner
      (including any of its assignees or designees) shall cooperate with the Servicer
      by providing timely notice of requests for information under these provisions
      and by reasonably limiting such requests to information required, in the Owner’s
      reasonable judgment, to comply with Regulation AB.

     

    Section
      13.02 Additional
      Representations and Warranties of the Servicer.

     

    (a) The
      Servicer hereby represents to the Owner, to any Master Servicer and to any
      Depositor, as of the date on which information is first provided to the Owner,
      any Master Servicer or any Depositor under Section 13.03 that, except as
      disclosed in writing to the Owner or such Depositor prior to such date: (i)
      the
      Servicer is not aware and has not received notice that any default, early
      amortization or other performance triggering event has occurred as to any other
      securitization due to any act or failure to act of the Servicer; (ii) the
      Servicer has not been terminated as servicer in a residential mortgage loan
      securitization, either due to a servicing default or to application of a
      servicing performance test or trigger; (iii) no material noncompliance with
      the
      applicable servicing criteria with respect to other securitizations of
      residential mortgage loans involving the Servicer has been disclosed or reported
      by the Servicer; (iv) no material changes to the Servicer’s policies or
      procedures with respect to the servicing function it will perform under this
      Agreement and any Reconstitution Agreement for mortgage loans of a type similar
      to the Mortgage Loans have occurred during the three-year period immediately
      preceding the related Securitization Transaction; (v) there are no aspects
      of
      the Servicer’s financial condition that could have a material adverse effect on
      the performance by the Servicer of its servicing obligations under this
      Agreement or any Reconstitution Agreement; (vi) there are no material legal
      or
      governmental proceedings pending (or known to be contemplated) against the
      Servicer or any Subservicer; and (vii) there are no affiliations, relationships
      or transactions relating to the Servicer or any Subservicer with respect to
      any
      Securitization Transaction and any party thereto identified by the related
      Depositor of a type described in Item 1119 of Regulation AB.

     

    
      
        
        

      

      
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    (b) If
      so
      requested by the Owner, any Master Servicer or any Depositor on any date
      following the date on which information is first provided to the Owner, any
      Master Servicer or any Depositor under Section 13.03, the Servicer shall, within
      five Business Days following such request, confirm in writing the accuracy
      of
      the representations and warranties set forth in paragraph (a) of this Section
      or, if any such representation and warranty is not accurate as of the date
      of
      such request, provide reasonably adequate disclosure of the pertinent facts,
      in
      writing, to the requesting party.

     

    Section
      13.03 Information
      to Be Provided by the Servicer.

     

    In
      connection with any Securitization Transaction the Servicer shall (i) within
      five Business Days following request by the Owner or any Depositor, provide
      to
      the Owner and such Depositor (or, as applicable, cause each Subservicer to
      provide), in writing and in form and substance reasonably satisfactory to the
      Owner and such Depositor, the information and materials specified in paragraphs
      (a), (b) and (e) of this Section, and (ii) as promptly as practicable following
      notice to or discovery by the Servicer, provide to the Owner and any Depositor
      (in writing and in form and substance reasonably satisfactory to the Owner
      and
      such Depositor) the information specified in paragraph (d) of this
      Section.

     

    (a) If
      so
      requested by the Owner or any Depositor, the Servicer shall provide such
      information regarding the Servicer, as servicer of the Mortgage Loans, and
      each
      Subservicer (each of the Servicer and each Subservicer, for purposes of this
      paragraph, a “Servicer”), as is requested for the purpose of compliance with
      Items 1108, 1117 and 1119 of Regulation AB. Such information shall include,
      at a
      minimum:

     

    (A) the
      Servicer’s form of organization;

     

    
      
        
        

      

      
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    (B) a
      description of how long the Servicer has been servicing residential mortgage
      loans; a general discussion of the Servicer’s experience in servicing assets of
      any type as well as a more detailed discussion of the Servicer’s experience in,
      and procedures for, the servicing function it will perform under this Agreement
      and any Reconstitution Agreements; information regarding the size, composition
      and growth of the Servicer’s portfolio of residential mortgage loans of a type
      similar to the Mortgage Loans and information on factors related to the Servicer
      that may be material, in the good faith judgment of the Owner or any Depositor,
      to any analysis of the servicing of the Mortgage Loans or the related
      asset-backed securities, as applicable, including, without
      limitation:

     

    
      	 	
              (i)

            	
              whether
                any prior securitizations of mortgage loans of a type similar to
                the
                Mortgage Loans involving the Servicer have defaulted or experienced
                an
                early amortization or other performance triggering event because
                of
                servicing during the three-year period immediately preceding the
                related
                Securitization Transaction;

            


    

     

    
      	 	
              (ii)

            	
              the
                extent of outsourcing the Servicer
                utilizes;

            


    

     

    
      	 	
              (iii)

            	
              whether
                there has been previous disclosure of material noncompliance with
                the
                applicable servicing criteria with respect to other securitizations
                of
                residential mortgage loans involving the Servicer as a servicer during
                the
                three-year period immediately preceding the related Securitization
                Transaction;

            


    

     

    
      	 	
              (iv)

            	
              whether
                the Servicer has been terminated as servicer in a residential mortgage
                loan securitization, either due to a servicing default or to application
                of a servicing performance test or trigger;
                and

            


    

     

    
      	 	
              (v)

            	
              such
                other information as the Owner or any Depositor may reasonably request
                for
                the purpose of compliance with Item 1108(b)(2) of Regulation
                AB;

            


    

     

    (C) a
      description of any material changes during the three-year period immediately
      preceding the related Securitization Transaction to the Servicer’s policies or
      procedures with respect to the servicing function it will perform under this
      Agreement and any Reconstitution Agreements for mortgage loans of a type similar
      to the Mortgage Loans;

     

    (D) information
      regarding the Servicer’s financial condition, to the extent that there is a
      material risk that an adverse financial event or circumstance involving the
      Servicer could have a material adverse effect on the performance by the Servicer
      of its servicing obligations under this Agreement or any Reconstitution
      Agreement;

     

    (E) information
      regarding advances made by the Servicer on the Mortgage Loans and the Servicer’s
      overall servicing portfolio of residential mortgage loans for the three-year
      period immediately preceding the related Securitization Transaction, which
      may
      be limited to a statement by an authorized officer of the Servicer to the effect
      that the Servicer has made all advances required to be made on residential
      mortgage loans serviced by it during such period, or, if such statement would
      not be accurate, information regarding the percentage and type of advances
      not
      made as required, and the reasons for such failure to advance;

     

    
      
        
        

      

      
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    (F) a
      description of the Servicer’s processes and procedures designed to address any
      special or unique factors involved in servicing loans of a similar type as
      the
      Mortgage Loans;

     

    (G) a
      description of the Servicer’s processes for handling delinquencies, losses,
      bankruptcies and recoveries, such as through liquidation of mortgaged
      properties, sale of defaulted mortgage loans or workouts; and

     

    (H) information
      as to how the Servicer defines or determines delinquencies and charge-offs,
      including the effect of any grace period, re-aging, restructuring, partial
      payments considered current or other practices with respect to delinquency
      and
      loss experience.

     

    (I) a
      description of any material legal or governmental proceedings pending (or known
      to be contemplated) against the Servicer; and

     

    (J) a
      description of any affiliation or relationship between the Servicer and any
      of
      the following parties to a Securitization Transaction, as such parties are
      identified to the Servicer by the Owner or any Depositor in writing in advance
      of such Securitization Transaction:

     

    (1)
      the
      Sponsor;

    (2)
      the
      Depositor;

    (3)
      the
      issuing entity;

    (4)
      any
      servicer;

    (5)
      any
      trustee;

    (6)
      any
      originator;

    (7)
      any
      significant obligor;

    (8)
      any
      enhancement or support provider; and 

    (9)
      any
      other material transaction party.

     

    (b) For
      the
      purpose of satisfying the reporting obligations of an Owner, Master Servicer
      or
      Depositor under the Exchange Act with respect to any class of asset-backed
      securities, the Servicer shall (or shall cause each Subservicer to) (i) provide
      prompt notice to the Owner, any Master Servicer and any Depositor in writing
      of
      (A) any material litigation or governmental proceedings involving the Servicer,
      any Subservicer, (B) any affiliations or relationships that develop following
      the closing date of a Securitization Transaction between the Servicer, any
      Subservicer and any of the parties specified in clause (J) of paragraph (a)
      of
      this Section (and any other parties identified in writing by the requesting
      party) with respect to such Securitization Transaction, (C) any Event of Default
      under the terms of this Agreement or any Reconstitution Agreement, (D) any
      merger, consolidation or sale of substantially all of the assets of the
      Servicer, and (E) the Servicer’s entry into an agreement with a Subservicer to
      perform or assist in the performance of any of the Servicer’s obligations under
      this Agreement or any Reconstitution Agreement, and (ii) provide to the Owner
      and any Depositor a description of such proceedings, affiliations or
      relationships.

     

    
      
        
        

      

      
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    (c) As
      a
      condition to the succession to the Servicer or any Subservicer as servicer
      or
      subservicer under this Agreement or any Reconstitution Agreement by any Person
      (i) into which the Servicer or such Subservicer may be merged or consolidated,
      or (ii) which may be appointed as a successor to the Servicer or any
      Subservicer, the Servicer shall provide to the Owner, any Master Servicer and
      any Depositor, at least 15 calendar days prior to the effective date of such
      succession or appointment, (x) written notice to the Owner and any Depositor
      of
      such succession or appointment and (y) in writing and in form and substance
      reasonably satisfactory to the Owner and such Depositor, all information
      reasonably requested by the Owner or any Depositor in order to comply with
      its
      reporting obligation under Item 6.02 of Form 8-K with respect to any class
      of
      asset-backed securities.

     

    (d) In
      addition to such information as the Servicer, as servicer, is obligated to
      provide pursuant to other provisions of this Agreement not later than ten days
      prior to the deadline for the filing of any distribution report on Form 10-D
      in
      respect of any Securitization Transaction that includes any of the Mortgage
      Loans serviced by the Servicer or any Subservicer, the Servicer or such
      Subservicer, as applicable, shall, to the extent the Servicer or such
      Subservicer has knowledge, provide to the party responsible for filing such
      report (including, if applicable, the Master Servicer) notice of the occurrence
      of any of the following events along with all information, data, and materials
      related thereto as may be required to be included in the related distribution
      report on Form 10-D (as specified in the provisions of Regulation AB referenced
      below):

     

    (i)
      any
      material modifications, extensions or waivers of pool asset terms, fees,
      penalties or payments during the distribution period or that have cumulatively
      become material over time (Item 1121(a)(11) of Regulation AB;

     

    (ii)
      material breaches of pool asset representations or warranties or transaction
      covenants (Item 1121(a)(12) of Regulation AB; and 

     

    (e) The
      Servicer shall provide to the Owner, any Master Servicer and any Depositor,
      evidence of the authorization of the person signing any certification or
      statement, copies or other evidence of Fidelity Bond Insurance and Errors and
      Omission Insurance policy, financial information and reports, and such other
      information related to the Servicer or any Subservicer or the Servicer’s or such
      Subservicer’s performance hereunder.

     

    Section
      13.04 Annual
      Statements as to Compliance.

     

    On
      or
      before March 1 of each calendar year, commencing in 2007, the Servicer shall
      deliver to the Owner, any Master Servicer and any Depositor a statement of
      compliance addressed to the Owner, such Master Servicer and such Depositor
      and
      signed by an authorized officer of the Servicer, to the effect that (i) a review
      of the Servicer’s activities during the immediately preceding calendar year (or
      applicable portion thereof) and of its performance under this Agreement and
      any
      applicable Reconstitution Agreement during such period has been made under
      such
      officer’s supervision, and (ii) to the best of such officers’ knowledge, based
      on such review, the Servicer has fulfilled all of its obligations under this
      Agreement and any applicable Reconstitution Agreement in all material respects
      throughout such calendar year (or applicable portion thereof) or, if there
      has
      been a failure to fulfill any such obligation in any material respect,
      specifically identifying each such failure known to such officer and the nature
      and the status thereof.

     

    
      
        
        

      

      
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    Section
      13.05 Report
      on Assessment of Compliance and Attestation.

     

    On
      or
      before March 1 of each calendar year, commencing in 2007, the Servicer
      shall:

     

    
      	 	
              (i)

            	
              deliver
                to the Owner, any Master Servicer and any Depositor a report (in
                form and
                substance reasonably satisfactory to the Owner, such Master Servicer
                and
                such Depositor) regarding the Servicer’s assessment of compliance with the
                Servicing Criteria during the immediately preceding calendar year,
                as
                required under Rules 13a-18 and 15d-18 of the Exchange Act and Item
                1122
                of Regulation AB. Such report shall be addressed to the Owner, such
                Master
                Servicer and such Depositor and signed by an authorized officer of
                the
                Servicer, and shall address each of the Servicing Criteria specified
                on
                Exhibit C;

            


    

     

    
      	 	
              (ii)

            	
              deliver
                to the Owner, any Master Servicer and any Depositor a report of a
                registered public accounting firm reasonably acceptable to the Owner,
                such
                Master Servicer and such Depositor that attests to, and reports on,
                the
                assessment of compliance made by the Servicer and delivered pursuant
                to
                the preceding paragraph. Such attestation shall be in accordance
                with
                Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities
                Act
                and the Exchange Act;

            


    

     

    
      	 	
              (iii)

            	
              cause
                each Subservicer, and each Subcontractor determined by the Servicer
                pursuant to Section 13.06(b) to be “participating in the servicing
                function” within the meaning of Item 1122 of Regulation AB, to deliver to
                the Owner, any Master Servicer and any Depositor an assessment of
                compliance and accountants’ attestation as and when provided in paragraphs
                (a) and (b) of this Section; and

            


    

     

    
      	 	
              (iv)

            	
              if
                requested by the Owner, any Master Servicer or any Depositor, deliver,
                and
                cause each Subservicer and Subcontractor as described in clause (iii)
                to
                provide, to the Owner, such Master Servicer and such Depositor and
                any
                other Person that will be responsible for signing the certification
                (a
                “Sarbanes Certification”) required by Rules 13a-14(d) and 15d-14(d) under
                the Exchange Act (pursuant to Section 302 of the Sarbanes-Oxley Act
                of
                2002) on behalf of an asset-backed issuer with respect to a Securitization
                Transaction a certification in the form attached hereto as Exhibit
                D.

            


    

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

     

    The
      Servicer acknowledges that the parties identified in clause (a)(iv) above may
      rely on the certification provided by the Servicer pursuant to such clause
      in
      signing a Sarbanes Certification and filing such with the Commission. Neither
      the Owner nor any Master Servicer nor any Depositor will request delivery of
      a
      certification under clause (a)(iv) above unless a Depositor is required under
      the Exchange Act to file an annual report on Form 10-K with respect to an
      issuing entity whose asset pool includes Mortgage Loans.

     

    Each
      assessment of compliance provided by a Subservicer pursuant to Section
      13.05(a)(i) shall address each of the Servicing Criteria specified on a
      certification substantially in the form of Exhibit C hereto delivered to the
      Owner concurrently with the execution of this Agreement or, in the case of
      a
      Subservicer subsequently appointed as such, on or prior to the date of such
      appointment. An assessment of compliance provided by a Subcontractor pursuant
      to
      Section 13.05(a)(iii) need not address any elements of the Servicing Criteria
      other than those specified by the Servicer pursuant to Section
      13.06.

     

    Section
      13.06 Use
      of Subservicers and Subcontractors.

     

    The
      Servicer shall not hire or otherwise utilize the services of any Subservicer
      to
      fulfill any of the obligations of the Servicer as servicer under this Agreement
      or any Reconstitution Agreement unless the Servicer complies with the provisions
      of paragraph (a) of this Section. The Servicer shall not hire or otherwise
      utilize the services of any Subcontractor, and shall not permit any Subservicer
      to hire or otherwise utilize the services of any Subcontractor, to fulfill
      any
      of the obligations of the Servicer as servicer under this Agreement or any
      Reconstitution Agreement unless the Servicer complies with the provisions of
      paragraph (b) of this Section.

     

    (a) It
      shall
      not be necessary for the Servicer to seek the consent of the Owner, any Master
      Servicer or any Depositor to the utilization of any Subservicer. The Servicer
      shall cause any Subservicer used by the Servicer (or by any Subservicer) for
      the
      benefit of the Owner and any Depositor to comply with the provisions of this
      Section and with Sections 13.02, 13.03(a) and (c), 13.04, 13.05 and 13.07 of
      this Agreement to the same extent as if such Subservicer were the Servicer,
      and
      to provide the information required with respect to such Subservicer under
      Section 13.03(d) of this Agreement. The Servicer shall be responsible for
      obtaining from each Subservicer and delivering to the Owner and any Depositor
      any servicer compliance statement required to be delivered by such Subservicer
      under Section 13.04, any assessment of compliance and attestation required
      to be
      delivered by such Subservicer under Section 13.05 and any certification required
      to be delivered to the Person that will be responsible for signing the Sarbanes
      Certification under Section 13.05 as and when required to be
      delivered.

     

    (b) It
      shall
      not be necessary for the Servicer to seek the consent of the Owner, any Master
      Servicer or any Depositor to the utilization of any Subcontractor. The Servicer
      shall promptly upon request provide to the Owner and any Depositor (or any
      designee of the Depositor, such as a master servicer or administrator) a written
      description (in form and substance satisfactory to the Owner and such Depositor)
      of the role and function of each Subcontractor utilized by the Servicer or
      any
      Subservicer, specifying (i) the identity of each such Subcontractor, (ii) which
      (if any) of such Subcontractors are “participating in the servicing function”
within the meaning of Item 1122 of Regulation AB, and (iii) which elements
      of
      the Servicing Criteria will be addressed in assessments of compliance provided
      by each Subcontractor identified pursuant to clause (ii) of this
      paragraph.

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

     

    As
      a
      condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
      Regulation AB, the Servicer shall cause any such Subcontractor used by the
      Servicer (or by any Subservicer) for the benefit of the Owner and any Depositor
      to comply with the provisions of Sections 13.05 and 13.07 of this Agreement
      to
      the same extent as if such Subcontractor were the Servicer. The Servicer shall
      be responsible for obtaining from each Subcontractor and delivering to the
      Owner
      and any Depositor any assessment of compliance and attestation or other
      certifications required to be delivered by such Subcontractor under Section
      13.05, in each case as and when required to be delivered.

     

    Section
      13.07 Indemnification;
      Remedies.

     

    (a) The
      Servicer shall indemnify the Owner, each affiliate of the Owner, and each of
      the
      following parties participating in a Securitization Transaction: each Person
      (including, but not limited to, any Master Servicer if applicable) responsible
      for the preparation, execution or filing of any report required to be filed
      with
      Commission with respect to such Securitization Transaction, or for execution
      of
      a certification pursuant to Rule 13a-14d or Rule 15d-14d under the Exchange
      Act
      with respect to such Securitization Transaction, each sponsor and issuing
      entity; each broker dealer acting as underwriter, placement agent or initial
      purchaser, each Person who controls any of such parties or the Depositor (within
      the meaning of Section 15 of the Securities Act and Section 20 of the Exchange
      Act); and the respective present and former directors, officers, employees,
      agents and affiliates of each of the foregoing and of the Depositor (each,
      an
“Indemnified Party”), and shall hold each of them harmless from and against any
      claims, losses, damages, penalties, fines, forfeitures, legal fees and expenses
      and related costs, judgments, and any other costs, fees and expenses that any
      of
      them may sustain arising out of or based upon:

     

    
      	
            	(i)	
              (A)
                any untrue statement of a material fact contained or alleged to be
                contained in any information, report, certification, data, accountants’
                letter or other material provided under this Article 13 by or on
                behalf of
                the Servicer, or provided under this Article 13 by or on behalf of
                any
                Subservicer or Subcontractor (collectively, the “Servicer Information”),
                or (B) the omission or alleged omission to state in the Servicer
                Information a material fact required to be stated in the Servicer
                Information or necessary in order to make the statements therein,
                in the
                light of the circumstances under which they were made, not misleading;
                provided, by way of clarification, that clause (B) of this paragraph
                shall
                be construed solely by reference to the Servicer Information and
                not to
                any other information communicated in connection with a sale or purchase
                of securities, without regard to whether the Servicer Information
                or any
                portion thereof is presented together with or separately from such
                other
                information;

            


    

     

    
      	 	
              (ii)

            	
              any
                breach by the Servicer of its obligations under this Article XIII,
                including any failure by the Servicer, any Subservicer or any
                Subcontractor to deliver any information, report, certification,
                accountants’ letter or other material when and as required under this
                Article 13, including any failure by the Servicer to identify pursuant
                to
                Section 13.06(b) any Subcontractor “participating in the servicing
                function” within the meaning of Item 1122 of Regulation AB;
                

            


    

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (iii)

            	
              any
                breach by the Servicer of a representation or warranty set forth
                in
                Section 13.02(a) or in a writing furnished pursuant to Section 13.02(b)
                and made as of a date prior to the closing date of the related
                Securitization Transaction, to the extent that such breach is not
                cured by
                such closing date, or any breach by the Servicer of a representation
                or
                warranty in a writing furnished pursuant to Section 13.02(b) to the
                extent
                made as of a date subsequent to such closing date;
                or

            


    

     

    
      	 	
              (iv)

            	
              the
                negligence, bad faith or willful misconduct of the Servicer in connection
                with its performance under this Article
                XIII.

            


    

     

    If
      the
      indemnification provided for in this Section is unavailable or insufficient
      to
      hold harmless an Indemnified Party, then the Servicer agrees that it shall
      contribute to the amount paid or payable by such Indemnified Party as a result
      of any claims, losses, damages or liabilities incurred by such Indemnified
      Party
      in such proportion as is appropriate to reflect the relative fault of such
      Indemnified Party on the one hand and the Servicer on the other.

     

    In
      the
      case of
      any
      failure of performance described in clause (a)(ii) of this Section, the Servicer
      shall promptly
      reimburse the Owner, any Depositor, as applicable, and each Person responsible
      for the preparation, execution or filing of any report required to be filed
      with
      the Commission with respect to such Securitization Transaction, or for execution
      of a certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the
      Exchange Act with respect to such Securitization Transaction, for all costs
      reasonably incurred by each such party in order to obtain the information,
      report, certification, accountants’ letter or other material not delivered as
      required by the Servicer, any Subservicer or any Subcontractor.

     

    This
      indemnification shall survive the termination of this Agreement or the
      termination of any party to this Agreement.

     

    (b) (i) Any
      failure by the Servicer, any Subservicer or any Subcontractor to deliver any
      information, report, certification, accountants’ letter or other material when
      and as required under this Article 13, or any breach by the Servicer of a
      representation or warranty set forth in Section 13.02(a) or in a writing
      furnished pursuant to Section 13.02(b) and made as of a date prior to the
      closing date of the related Securitization Transaction, to the extent that
      such
      breach is not cured by such closing date, or any breach by the Servicer of
      a
      representation or warranty in a writing furnished pursuant to Section 13.02(b)
      to the extent made as of a date subsequent to such closing date, shall, except
      as provided in clause (ii) of this paragraph, immediately and automatically,
      without notice or grace period, constitute an Event of Default with respect
      to
      the Servicer under this Agreement and any applicable Reconstitution Agreement,
      and shall entitle the Owner or Depositor, as applicable, in its sole discretion
      to terminate the rights and obligations of the Servicer as servicer under this
      Agreement and/or any applicable Reconstitution Agreement without payment
      (notwithstanding anything in this Agreement or any applicable Reconstitution
      Agreement to the contrary) of any compensation to the Servicer; provided that
      to
      the extent that any provision of this Agreement and/or any applicable
      Reconstitution Agreement expressly provides for the survival of certain rights
      or obligations following termination of the Servicer as servicer, such provision
      shall be given effect.

     

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

     

    (ii) Any
      failure by the Servicer, any Subservicer or any Subcontractor to deliver any
      information, report, certification or accountants’ letter when and as required
      under Section 13.04 or 13.05, including (except as provided below) any failure
      by the Servicer to identify pursuant to Section 13.06(b) any Subcontractor
      “participating in the servicing function” within the meaning of Item 1122 of
      Regulation AB, which continues unremedied for ten calendar days after the date
      on which such information, report, certification or accountants’ letter was
      required to be delivered shall constitute an Event of Default with respect
      to
      the Servicer under this Agreement and any applicable Reconstitution Agreement,
      and shall entitle the Owner or Depositor, as applicable, in its sole discretion
      to terminate the rights and obligations of the Servicer as servicer under this
      Agreement and/or any applicable Reconstitution Agreement without payment
      (notwithstanding anything in this Agreement to the contrary) of any compensation
      to the Servicer (and if the Servicer is servicing any of the Mortgage Loans
      in a
      Securitization Transaction, appoint a successor servicer reasonably acceptable
      to any Master Servicer for such Securitization Transactin); provided that to
      the
      extent that any provision of this Agreement and/or any applicable Reconstitution
      Agreement expressly provides for the survival of certain rights or obligations
      following termination of the Servicer as servicer, such provision shall be
      given
      effect.

     

    Neither
      the Owner nor any Depositor shall be entitled to terminate the rights and
      obligations of the Servicer pursuant to this subparagraph (b)(ii) if a failure
      of the Servicer to identify a Subcontractor “participating in the servicing
      function” within the meaning of Item 1122 of Regulation AB was attributable
      solely to the role or functions of such Subcontractor with respect to mortgage
      loans other than the Mortgage Loans.

     

    (iii) The
      Servicer shall promptly reimburse the Owner (or any designee of the Owner,
      such
      as a master servicer) and any Depositor, as applicable, for all reasonable
      expenses incurred by the Owner (or such designee) or such Depositor, as such
      are
      incurred, in connection with the termination of the Servicer as servicer and
      the
      transfer of servicing of the Mortgage Loans to a successor servicer. The
      provisions of this paragraph shall not limit whatever rights the Owner or any
      Depositor may have under other provisions of this Agreement and/or any
      applicable Reconstitution Agreement or otherwise, whether in equity or at law,
      such as an action for damages, specific performance or injunctive
      relief.

     

    Section
      13.08 Third
      Party Beneficiary.

     

    For
      purposes of this Article XIII and any related provisions thereto, each Master
      Servicer shall be considered a third party beneficiary of this Agreement,
      entitled to all the rights and benefits hereof as if it were a party to this
      Agreement.

     

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties have caused this Agreement to be executed by their
      respective officers thereunto duly authorized as of the day and year first
      set
      forth above.

     

    
      	 	 	 
	 	RWT
              HOLDINGS,
              INC.
	 
 	 
 	 
 
	
            	By:  	
            
	 	 	
              

            
	 	Name:	 
	 	Title: 	 
	 	
            


    

     

    
      	 	 	 
	 	MORGAN
              STANLEY
              CREDIT CORPORATION
	 
 	 
 	 
 
	
            	By:  	
            
	 	 	
              

            
	 	Name:	 
	 	Title: 	 
	 	
            


    

     

    
      	 	 	 
	 	REDWOOD
              TRUST,
              INC.
	 
 	 
 	 
 
	
            	By:  	
            
	 	 	
              

            
	 	Name:	 
	 	Title: 	 
	 	
            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

     

    FORM
      OF LIMITED POWER OF ATTORNEY

     

    KNOW
      ALL
      MEN BY THESE PRESENTS that RWT Holdings, Inc. (“Owner”) having its principal
      place of business at 591 Redwood Highway, Suite 3140, Mill Valley, California
      94941, hereby constitutes and appoints Morgan Stanley Credit Corporation (“the
      Servicer”), a Delaware corporation having its principal place of business at
      2500 Lake Cook Road, Riverwoods, Illinois 60015, by and through any of its
      Vice
      Presidents or more senior officers, its true and lawful Attorney-in-Fact, in
      its
      name, place and stead and for its benefit, in connection with all residential
      mortgage loans serviced by the Servicer for Owner for the purposes of performing
      all acts and executing all documents in the name of Owner necessary and
      incidental to servicing said loans, including but not limited to:

     

    (1) Foreclosing
      delinquent loans or discontinuing such foreclosure proceedings, executing claims
      for insurance benefits under private mortgage insurance policies and endorsing
      related proceeds checks made payable to Owner;

     

    (2) Selling,
      transferring or otherwise disposing of real property acquired through
      foreclosure or otherwise, including but not limited to executing all contracts,
      agreements, deeds, assignments or other instruments reasonably necessary or
      advisable to effect such sale, transfer or disposition, and receiving proceeds
      and endorsing checks made payable to the order of Owner from such
      proceedings;

     

    (3) Preparing,
      executing and delivering satisfactions, cancellations, discharges, or full
      or
      partial releases of lien, subordination agreements, modification agreements,
      assumption agreements, and substitutions of trustees under deeds of
      trust;

     

    (4) Endorsing
      promissory notes and executing assignments of mortgages, deeds of trust, deeds
      to secure debt and other security instruments securing said promissory notes
      in
      connection with loans for which the Servicer has received full payment of all
      outstanding amounts due; and

     

    (5) Any
      and
      all such other acts of any kind and nature whatsoever that are necessary and
      prudent to service the loans.

     

    Owner
      further grants to the Servicer full power and authority to do and perform all
      acts necessary for the Servicer to carry into effect the power or powers granted
      by or under this Limited Power of Attorney as fully as Owner might or could
      do
      with the same validity as if all and every such act had been herein particularly
      stated, expressed and especially provided for, and hereby ratifies and confirms
      all that the Servicer shall lawfully have done, do, or cause to be done by
      virtue of the powers and authority and contemplated hereby. This Limited Power
      of Attorney shall be effective as of November 1, 2006.

     

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

     

    Third
      parties without actual notice may rely upon the exercise of the power granted
      under this Limited Power of Attorney, and may be satisfied that this Limited
      Power of Attorney shall continue in full force and effect until revoked in
      writing by Owner. Third parties without actual notice may rely upon a
      certificate to the effect set forth in the preceding sentence given by the
      Servicer.

     

    
      	ATTEST 	 	 	RWT HOLDINGS, INC.
	 	 	 	 
	 	 	 	 
	By: 
              	 	 	By: 
              
	
              
                

              

              Name:

              Title: 

            	 	 	
              
                

              

              Name:

              Title:

            
	 	 	 	
            


    

     

    STATE
      OF______________ )

     ) ss:

    COUNTY
      OF____________ )

     

    On
      the
      __day of____, ____, before me, the undersigned, a Notary Public in and for
      said
      county and state, personally appeared _____________________ and
      ___________________, personally known to me to be the persons who executed
      the
      within instrument as _____________________ and ______________________,
      respectively, on behalf of the corporation therein named, and they duly
      severally acknowledged that they reside at __________________________________
      and that said instrument is the act and deed of said corporation, and that
      they,
      being authorized to do so, executed and delivered said instrument and affixed
      the corporate seal thereto for the purposes therein contained.

     

    Witness
      my hand and official seal:

     

    
      	 	Notary Public State
              of ___________________  
	 	 
	 	
              My
                Commission Expires:___________________ 

            


    

     

    
      
        
        

      

      
        A-2

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

     

    FORM
      OF MONTHLY SERVICER REPORT

     

    
      
        
        

      

      
        B-1

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      C

     

    SERVICING
      CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

     

    The
      assessment of compliance to be delivered by [Morgan Stanley Credit Corporation]
      [Subservicer] shall address, at a minimum, the criteria identified as below
      as
“Applicable Servicing Criteria”:

     

    
      	 	 	
              Servicing
                Criteria

            	 	
              Applicable

              Servicing
                Criteria

            
	
              Reference

            	 	
              Criteria

            	 	 
	 	 	
              General
                Servicing Considerations

            	 	 
	 	 	 	 	 
	
              1122(d)(1)(i)

            	 	
              Policies
                and procedures are instituted to monitor any performance or other
                triggers
                and events of default in accordance with the transaction
                agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(1)(ii)

            	 	
              If
                any material servicing activities are outsourced to third parties,
                policies and procedures are instituted to monitor the third party’s
                performance and compliance with such servicing activities.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(1)(iii)

            	 	
              Any
                requirements in the transaction agreements to maintain a back-up
                servicer
                for the mortgage loans are maintained.

            	 	 
	 	 	 	 	 
	
              1122(d)(1)(iv)

            	 	
              A
                fidelity bond and errors and omissions policy is in effect on the
                party
                participating in the servicing function throughout the reporting
                period in
                the amount of coverage required by and otherwise in accordance with
                the
                terms of the transaction agreements.

            	 	
              X

            
	 	 	 	 	 
	 	 	
              Cash
                Collection and Administration

            	 	 
	 	 	 	 	 
	
              1122(d)(2)(i)

            	 	
              Payments
                on mortgage loans are deposited into the appropriate custodial bank
                accounts and related bank clearing accounts no more than two business
                days
                following receipt, or such other number of days specified in the
                transaction agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(2)(ii)

            	 	
              Disbursements
                made via wire transfer on behalf of an obligor or to an investor
                are made
                only by authorized personnel.

            	 	
              X

            


    

     

    
      
        
        

      

      
        C-1

        
          

        

      

      
        
        

      

    

     

    
      	
            	 	
              Servicing
                Criteria

            	 	
              Applicable

              Servicing
                Criteria

            
	
              Reference

            	 	
              Criteria

            	 	 
	 	 	
            	 	 


    

    
      	
              1122(d)(2)(iii)

            	 	
              Advances
                of funds or guarantees regarding collections, cash flows or distributions,
                and any interest or other fees charged for such advances, are made,
                reviewed and approved as specified in the transaction
                agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(2)(iv)

            	 	
              The
                related accounts for the transaction, such as cash reserve accounts
                or
                accounts established as a form of overcollateralization, are separately
                maintained (e.g., with respect to commingling of cash) as set forth
                in the
                transaction agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(2)(v)

            	 	
              Each
                custodial account is maintained at a federally insured depository
                institution as set forth in the transaction agreements. For purposes
                of
                this criterion, “federally insured depository institution” with respect to
                a foreign financial institution means a foreign financial institution
                that
                meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange
                Act.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(2)(vi)

            	 	
              Unissued
                checks are safeguarded so as to prevent unauthorized
                access.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(2)(vii)

            	 	
              Reconciliations
                are prepared on a monthly basis for all asset-backed securities related
                bank accounts, including custodial accounts and related bank clearing
                accounts. These reconciliations are (A) mathematically accurate;
                (B)
                prepared within 30 calendar days after the bank statement cutoff
                date, or
                such other number of days specified in the transaction agreements;
                (C)
                reviewed and approved by someone other than the person who prepared
                the
                reconciliation; and (D) contain explanations for reconciling items.
                These
                reconciling items are resolved within 90 calendar days of their original
                identification, or such other number of days specified in the transaction
                agreements.

            	 	
              X

            
	 	 	 	 	 
	 	 	
              Investor
                Remittances and Reporting

            	 	 
	 	 	 	 	 
	
              1122(d)(3)(i)

            	 	
              Reports
                to investors, including those to be filed with the Commission, are
                maintained in accordance with the transaction agreements and applicable
                Commission requirements. Specifically, such reports (A) are prepared
                in
                accordance with timeframes and other terms set forth in the transaction
                agreements; (B) provide information calculated in accordance with
                the
                terms specified in the transaction agreements; (C) are filed with
                the
                Commission as required by its rules and regulations; and (D) agree
                with
                investors’ or the trustee’s records as to the total unpaid principal
                balance and number of mortgage loans serviced by the
                Servicer.

            	 	
              X

            


    

     

    
      
        
        

      

      
        C-2

        
          

        

      

      
        
        

      

    

     

    
      	
            	 	
              Servicing
                Criteria

            	 	
              Applicable

              Servicing
                Criteria

            
	
              Reference

            	 	
              Criteria

            	 	 
	 	 	
            	 	 


    

    
      	
              1122(d)(3)(ii)

            	 	
              Amounts
                due to investors are allocated and remitted in accordance with timeframes,
                distribution priority and other terms set forth in the transaction
                agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(3)(iii)

            	 	
              Disbursements
                made to an investor are posted within two business days to the Servicer’s
                investor records, or such other number of days specified in the
                transaction agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(3)(iv)

            	 	
              Amounts
                remitted to investors per the investor reports agree with cancelled
                checks, or other form of payment, or custodial bank
                statements.

            	 	
              X

            
	 	 	 	 	 
	 	 	
              Pool
                Asset Administration

            	 	 
	 	 	 	 	 
	
              1122(d)(4)(i)

            	 	
              Collateral
                or security on mortgage loans is maintained as required by the transaction
                agreements or related mortgage loan documents.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(ii)

            	 	
              Mortgage
                loan and related documents are safeguarded as required by the transaction
                agreements

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(iii)

            	 	
              Any
                additions, removals or substitutions to the asset pool are made,
                reviewed
                and approved in accordance with any conditions or requirements in
                the
                transaction agreements.

            	 	
              X

            


    

     

    
      
        
        

      

      
        C-3

        
          

        

      

      
        
        

      

    

     

    
      	
            	 	
              Servicing
                Criteria

            	 	
              Applicable

              Servicing
                Criteria

            
	
              Reference

            	 	
              Criteria

            	 	 
	 	 	
            	 	 


    

    
      	
              1122(d)(4)(iv)

            	 	
              Payments
                on mortgage loans, including any payoffs, made in accordance with
                the
                related mortgage loan documents are posted to the Servicer’s obligor
                records maintained no more than two business days after receipt,
                or such
                other number of days specified in the transaction agreements, and
                allocated to principal, interest or other items (e.g., escrow) in
                accordance with the related mortgage loan documents.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(v)

            	 	
              The
                Servicer’s records regarding the mortgage loans agree with the Servicer’s
                records with respect to an obligor’s unpaid principal
                balance.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(vi)

            	 	
              Changes
                with respect to the terms or status of an obligor’s mortgage loans (e.g.,
                loan modifications or re-agings) are made, reviewed and approved
                by
                authorized personnel in accordance with the transaction agreements
                and
                related pool asset documents.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(vii)

            	 	
              Loss
                mitigation or recovery actions (e.g., forbearance plans, modifications
                and
                deeds in lieu of foreclosure, foreclosures and repossessions, as
                applicable) are initiated, conducted and concluded in accordance
                with the
                timeframes or other requirements established by the transaction
                agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(viii)

            	 	
              Records
                documenting collection efforts are maintained during the period a
                mortgage
                loan is delinquent in accordance with the transaction agreements.
                Such
                records are maintained on at least a monthly basis, or such other
                period
                specified in the transaction agreements, and describe the entity’s
                activities in monitoring delinquent mortgage loans including, for
                example,
                phone calls, letters and payment rescheduling plans in cases where
                delinquency is deemed temporary (e.g., illness or
                unemployment).

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(ix)

            	 	
              Adjustments
                to interest rates or rates of return for mortgage loans with variable
                rates are computed based on the related mortgage loan
                documents.

            	 	
              X

            


    

     

    
      
        
        

      

      
        C-4

        
          

        

      

      
        
        

      

    

     

    
      	
            	 	
              Servicing
                Criteria

            	 	
              Applicable

              Servicing
                Criteria

            
	
              Reference

            	 	
              Criteria

            	 	 
	 	 	
            	 	 


    

    
      	
              1122(d)(4)(x)

            	 	
              Regarding
                any funds held in trust for an obligor (such as escrow accounts):
                (A) such
                funds are analyzed, in accordance with the obligor’s mortgage loan
                documents, on at least an annual basis, or such other period specified
                in
                the transaction agreements; (B) interest on such funds is paid, or
                credited, to obligors in accordance with applicable mortgage loan
                documents and state laws; and (C) such funds are returned to the
                obligor
                within 30 calendar days of full repayment of the related mortgage
                loans,
                or such other number of days specified in the transaction
                agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(xi)

            	 	
              Payments
                made on behalf of an obligor (such as tax or insurance payments)
                are made
                on or before the related penalty or expiration dates, as indicated
                on the
                appropriate bills or notices for such payments, provided that such
                support
                has been received by the servicer at least 30 calendar days prior
                to these
                dates, or such other number of days specified in the transaction
                agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(xii)

            	 	
              Any
                late payment penalties in connection with any payment to be made
                on behalf
                of an obligor are paid from the servicer’s funds and not charged to the
                obligor, unless the late payment was due to the obligor’s error or
                omission.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(xiii)

            	 	
              Disbursements
                made on behalf of an obligor are posted within two business days
                to the
                obligor’s records maintained by the servicer, or such other number of days
                specified in the transaction agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(xiv)

            	 	
              Delinquencies,
                charge-offs and uncollectible accounts are recognized and recorded
                in
                accordance with the transaction agreements.

            	 	
              X

            
	 	 	 	 	 
	
              1122(d)(4)(xv)

            	 	
              Any
                external enhancement or other support, identified in Item 1114(a)(1)
                through (3) or Item 1115 of Regulation AB, is maintained as set forth
                in
                the transaction agreements.

            	 	 


    

     

    
      
        
        

      

      
        C-5

        
          

        

      

      
        
        

      

    

     

    
      	 	[MORGAN STANLEY CREDIT
              CORPORATION]
	 	
              [SUBSERVICER]

            
	 	 
	 	Date:


    

     

    
      
        
        

      

      
        C-6

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      D

     

    FORM
      OF ANNUAL CERTIFICATION

     

    Re: The
      [                
 ]
      agreement dated as of
      [                          
 l,
      200[ ]
      (the “Agreement”), among [IDENTIFY PARTIES]

     

    I,
      _____________________________________, the _______________________ of [NAME
      OF
      SERVICER] and, in such capacity, the officer in charge of the Servicer’s
      responsibility on Exhibit D to the Agreement. I hereby certify to [the
      Purchaser], [the Depositor], and the [Master Servicer], and their officers,
      with
      the knowledge and intent that they will rely upon this certification,
      that:

     

    (A) I
      have
      reviewed the servicer compliance statement of the Servicer provided in
      accordance with Item 1123 of Regulation AB (the “Compliance Statement”), the
      report on assessment of the Servicer’s compliance with the servicing criteria
      set forth in Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided
      in accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act of
      1934, as amended (the “Exchange Act”) and Item 1122 of Regulation AB (the
“Servicing Assessment”), the registered public accounting firm’s attestation
      report provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
      Act and Section 1122(b) of Regulation AB (the “Attestation Report”), and all
      other data, servicing reports, officer’s certificates and other information
      relating to the performance of the Servicer under the terms of the Agreement
      and
      the servicing of the Mortgage Loans by the Servicer during 200[ ] that were
      delivered to the [Depositor] [Master Servicer] pursuant to the Agreement to
      the
      extent included in any Form 8-Ks, Form 10-Ds, Form 10-Ks or similar forms
      required by the Commission from time to time for the period covered by the
      Compliance Statement (collectively, the “Servicer Servicing
      Information”);

     

    (B) Based
      on
      my knowledge, the reports and information comprising the Servicer Servicing
      Information, taken as a whole, does not contain any untrue statement of a
      material fact or omit to state a material fact necessary to make the statements
      made, in the light of the circumstances under which such statements were made,
      not misleading as of the period covered by, or the date of such reports or
      information or the date of this certification;

     

    (C) Based
      on
      my knowledge, all of the Servicer Servicing Information required to be provided
      by the Servicer under the Agreement has been provided to the [Depositor] [Master
      Servicer];

     

    (D) I
      am
      responsible for reviewing the activities performed by the Servicer as servicer
      under the Agreement, and based on my knowledge and the compliance review
      conducted in preparing the Compliance Statement and except as disclosed in
      the
      Compliance Statement, the Servicing Assessment or the Attestation Report, the
      Servicer has fulfilled its obligations under the Agreement in all material
      respects; and

     

    
      
        
        

      

      
        D-1

        
          

        

      

      
        
        

      

    

     

    (E) The
      Compliance Statement required to be delivered by the Servicer pursuant to the
      Agreement, and the Servicing Assessment and Attestation Report required to
      be
      provided by the Servicer and by any Subservicer or Subcontractor pursuant to
      the
      Agreement, have been provided to the [Depositor] [Master Servicer]. The
      Servicing Assessment and the Attestation Report cover all items of the servicing
      criteria identified on Exhibit C to the Agreement as applicable to the Servicer.
      Any material instances of noncompliance described in such reports have been
      disclosed to the [Depositor] [Master Servicer]. Any material instance of
      noncompliance with the Servicing Criteria has been disclosed in such reports.
      The following material instances of noncompliance identified in the Servicing
      Assessment and the Attestation Report relate to the performance or obligations
      of the Servicer under the Agreement: ____________ (if none, state
“None.”)

     

    
      	 	
              Date:
                _________________________

            
	 	 
	 	 
	 	
              By: 

            
	 	
              
                

              

              Name:

            
	 	
              Title:

            
	 	 


    

     

    
      
        
        

      

      
        D-2

        
          

        

      

      
        
        

      

    

    
      
        MORGAN
          - SEQUOIA TO TRUSTEE

      

       

      ASSIGNMENT,
        ASSUMPTION AND RECOGNITION AGREEMENT

       

      For

       

      Master
        Servicing Agreement

       

      THIS
        ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT, dated as of May 25, 2007
        (“Assignment No. II”), is entered into among Sequoia Residential Funding, Inc.
        (the “Assignor”), Morgan Stanley Credit Corporation (formerly Morgan Stanley
        Dean Witter Credit Corporation), as the servicer (the “Servicer”), and HSBC Bank
        USA, National Association (“HSBC Bank”) as Trustee under a Pooling and Servicing
        Agreement dated as of May 1, 2007 (the “Pooling and Servicing Agreement”), among
        the Assignor, as Depositor, HSBC Bank (in such Trustee capacity, the “Assignee”)
        and Wells Fargo Bank, N. A., as Master Servicer and Securities
        Administrator.

       

      RECITALS

       

      WHEREAS,
        Redwood Trust, Inc. (“Redwood”) and the Servicer have entered into a certain
        Master Servicing Agreement, dated as of August 1, 2001 (as amended or modified
        to the date hereof, the “2001 Master Servicing Agreement”), and the Servicer is
        currently servicing certain mortgage loans (the “Mortgage Loans”) under the 2001
        Master Servicing Agreement; and

       

      WHEREAS,
        RWT Holdings, Inc. (“RWT”) has previously acquired from Redwood and has sold,
        assigned and transferred all of its right, title and interest in certain
        of the
        Mortgage Loans (the “Specified Mortgage Loans”) which are listed on the mortgage
        loan schedule attached as Exhibit
        I
        hereto
        (the “Specified Mortgage Loan Schedule”) and its rights under the 2001 Master
        Servicing Agreement with respect to the Specified Mortgage Loans to Assignor;
        and

       

      WHEREAS,
        the parties hereto agree that notwithstanding anything to the contrary in
        the
        2001 Master Servicing Agreement, the Specified Mortgage Loans are currently
        being serviced by the Servicer pursuant to the Master Servicing Agreement,
        dated
        as of November 1, 2006, between RWT and Servicer (the “Master Servicing
        Agreement”); and

       

      WHEREAS,
        the Assignor has agreed to sell, assign and transfer to Assignee all of its
        right, title and interest in the Specified Mortgage Loans and its rights
        under
        the Master Servicing Agreement with respect to the Specified Mortgage Loans;
        and

       

      WHEREAS,
        the parties hereto have agreed that the Specified Mortgage Loans shall be
        subject to the terms of this Assignment No. II.

       

      NOW,
        THEREFORE, in consideration of the mutual promises contained herein and other
        good and valuable consideration (the receipt and sufficiency of which are
        hereby
        acknowledged), the parties agree as follows:

      
         

        1. Assignment
          and Assumption.

         

        (a)
           Effective
          on and as of the date hereof, the Assignor hereby pledges, assigns and
          transfers
          to the Assignee all of its right, title and interest in the Specified Mortgage
          Loans and all of its rights (but none of the Owner’s obligations) provided under
          the Master Servicing Agreement to the extent relating to the Specified
          Mortgage
          Loans, the Assignee hereby accepts such assignment from the Assignor, and
          the
          Servicer hereby acknowledges such assignment and assumption.

      

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      


      (b) Effective
        on and as of the date hereof, the Assignor represents and warrants to the
        Assignee that the Assignor has not taken any action that would serve to impair
        or encumber the Assignee’s interest in the Specified Mortgage Loans since the
        date of the Assignor’s acquisition of the Specified Mortgage Loans.

       

      2. Recognition
        of the Assignee.

       

      From
        and
        after the date hereof, the Servicer shall recognize the Assignee as the holder
        of the rights and benefits of the Owner with respect to the Specified Mortgage
        Loans and the Servicer will service the Specified Mortgage Loans for the
        Assignee as if the Assignee and the Servicer had entered into a separate
        servicing agreement for the servicing of the Specified Mortgage Loans in
        the
        form of the Master Servicing Agreement (as modified by Appendix A hereto)
        (the
“Successor MSA”) with the Assignee as the Owner thereunder, which Successor MSA
        is incorporated in and made a part of this Assignment No. II. It is the
        intention of the parties hereto that the Successor MSA will be treated as
        a
        separate and distinct servicing agreement between the parties hereto to the
        extent of the Specified Mortgage Loans and shall be binding upon and for
        the
        benefit of the respective successors and assigns of the parties
        hereto.

       

      3. Assignor’s
        Continuing Rights and Responsibilities.

       

      Notwithstanding
        Sections 1 and 2 above, the parties hereto agree that the Assignor rather
        than
        the Assignee shall have the ongoing rights and responsibilities of the Owner
        under the following sections of the Master Servicing Agreement:

       

      
        	
                Section

              	 	
                Matter

              
	 	 	 
	
                4.01

              	 	
                (a) Role
                  of the Servicer.

              
	 	 	 
	
                7.05,
                  1st¶
                  and

                2nd¶

              	 	
                (b) Owner’s
                  Right to Examine the Servicer Records.

              
	 	 	 
	
                8.01

              	 	
                (c) The
                  Servicer Shall Provide Information as Reasonably Required.

              
	 	 	 
	
                9.01(a)
                  and (b)

              	 	
                (d) Indemnification;
                  Third-Party Claims.

              
	 	 	 
	
                9.03

              	 	
                (e) Limitation
                  on Liability of Servicer and Others.

              
	 	 	 
	
                12.03

              	 	
                (f) Assignments.

              
	 	 	 
	
                12.13(b)

              	 	
                (g) Non-Solicitation.

              


      

      


      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      In
        addition, the Servicer agrees to furnish to the Assignor and Master Servicer
        copies of reports, notices, statements and other communications required
        to be
        delivered by the Servicer pursuant to any of the sections of the Master
        Servicing Agreement referred to above and under the following sections, at
        the
        times therein specified:

       

      
        	
                Section

              	 	 
	 	 	 
	
                4.11,
                  5th
                  and 

                6th¶’s

              	 	
                (a) Title
                  Management and Disposition of REO Property.

              
	 	 	 
	
                6.02

              	 	
                (b) Statements
                  to Owner.

              
	 	 	 
	
                6.03(d)

              	 	
                (c) Monthly
                  Advances by the Servicer.

              
	 	 	 
	
                13.04

              	 	
                (d)
                  Annual Statement as to Compliance

              
	 	 	 
	
                13.05

              	 	
                (e)
                  Report on Assessment of Compliance and
                  Attestation

              


      

       

      4. Successor
        MSA.

       

      The
        Successor MSA includes the Master Servicing Agreement as modified by Appendix
        A
        hereto and is made a part of this Assignment No. II.

       

      5. Representations
        and Warranties.

       

      (a) Each
        of
        the parties hereto represents and warrants that it is duly and legally
        authorized to enter into this Assignment No. II.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      (b) Each
        of
        the parties hereto represents and warrants that this Assignment No. II has
        been
        duly authorized, executed and delivered by it and (assuming due authorization,
        execution and delivery thereof by each of the other parties hereto) constitutes
        its legal, valid and binding obligation, enforceable against it in accordance
        with its terms, except as such enforcement may be limited by bankruptcy,
        insolvency, reorganization or other similar laws affecting the enforcement
        of
        creditors’ rights generally and by general equitable principles (regardless of
        whether such enforcement is considered in a proceeding in equity or at
        law).

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      


      6. Continuing
        Effect.

       

      Except
        as
        contemplated hereby, the Master Servicing Agreement shall remain in full
        force
        and effect in accordance with its terms.

       

      7. Governing
        Law.

       

      This
        Assignment No. II and the rights and obligations hereunder shall be governed
        by
        and construed in accordance with the internal laws of the State of
        Illinois.

       

      8. Notices.

       

      Any
        notices or other communications permitted or required under the Master Servicing
        Agreement to be made to the Assignor and Assignee shall be made in accordance
        with the terms of the Master Servicing Agreement and shall be sent to the
        Assignor and Assignee as follows:

       

      Sequoia
        Residential Funding, Inc.

      One
        Belvedere Place, Suite 330

      Mill
        Valley, CA 94941

       

      HSBC
        Bank
        USA, National Association

      452
        Fifth
        Avenue

      New
        York,
        NY 10018

       

      or
        to
        such other address as may hereafter be furnished by the Assignor or Assignee
        to
        the other parties in accordance with the provisions of the Master Servicing
        Agreement.

       

      9. Counterparts.

       

      This
        Assignment No. II may be executed in 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.

       

      10. Definitions.

       

      Any
        capitalized term used but not defined in this Assignment No. II has the same
        meaning as in the Master Servicing Agreement or the Master Mortgage Loan
        Purchase Agreement referred to therein.

       

      11. Master
        Servicer.

       

      The
        Servicer hereby acknowledges that the Assignee has appointed Wells Fargo
        Bank,
        N. A. (the “Master Servicer”) to act as master servicer and securities
        administrator under the Pooling and Servicing Agreement and hereby agrees
        to
        treat all inquiries, instructions, authorizations and other communications
        from
        the Master Servicer as if the same had been received from the Assignee. The
        Master Servicer, acting on behalf of the Assignee, shall have the rights
        of the
        Assignee as the Owner under the Successor MSA to enforce the obligations
        of the
        Servicer thereunder. Any notices or other communications permitted or required
        under the Master Servicing Agreement to be made to the Assignee shall be
        made in
        accordance with the terms of the Master Servicing Agreement and shall be
        sent to
        the Master Servicer at the following address:

       

      Wells
        Fargo Bank, N. A.

      P.O.
        Box
        98

      Columbia,
        Maryland 21046 

      (or,
        for
        overnight deliveries, 9062 Old Annapolis Road, Columbia, Maryland
        21045)

      Attention:
        Sequoia Mortgage Trust 2007-2

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      


      or
        to
        such other address as may hereafter be furnished by the Master Servicer to
        Servicer. Any such notices or other communications permitted or required
        under
        the Master Servicing Agreement may be delivered in electronic format unless
        manual signature is required in which case a hard copy of such report or
        communication shall be required.

       

      The
        Servicer further acknowledges that the Assignor has engaged the Master Servicer
        to provide certain default administration and that the Master Servicer, acting
        as agent of the Assignor, may exercise any of the rights of the Owner retained
        by the Assignor in Section 3 above.

      


      The
        Servicer shall make all distributions under the Successor MSA, as they relate
        to
        the Specified Mortgage Loans, to the Master Servicer by wire transfer of
        immediately funds to:

      


       

      Wells
        Fargo Bank, NA

      San
        Francisco, CA

      ABA#
        121-000-248

      Acct#
        3970771416

      Acct
        Name: SAS Clearing

      FFC:
        53145300


       

      [remainder
        of page intentionally left blank]

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      


      IN
        WITNESS WHEREOF, the parties hereto have executed this Assignment No. II
        the day
        and year first above written.

       

      
        	 	 	 
	 	
                ASSIGNOR:

              
	 	 
	 	
                SEQUOIA
                  RESIDENTIAL FUNDING, INC.

              
	 
 	 
 	 
 
	
              	By:  	
              
	 	Name:
	 	Title:


      

      
         

        
          	 	 	 
	 	
                  ASSIGNEE:

                
	 	 
	 	
                  HSBC
                    BANK USA, NATIONAL

                  ASSOCIATION

                
	 
 	 
 	 
 
	
                	By:  	
                
	 	Name:
	 	Title:


        

        
           

          
            	 	 	 
	 	
                    SERVICER:

                  
	 	 
	 	
                    MORGAN
                      STANLEY CREDIT CORPORATION

                  
	 
 	 
 	 
 
	
                  	By:  	
                  
	 	Name:
	 	Title:


          

        

      

      


      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      


      EXHIBIT
        I

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      APPENDIX
        A

       

      MASTER
        SERVICING AGREEMENT

       

      1. The
        definition of Custodial Account is revised to read as follows:

       

      “
        ‘Custodial Account’: The separate trust account or accounts created and
        maintained pursuant to Section
        4.04
        of this
        Agreement which shall be entitled “Morgan Stanley Credit Corporation, in trust
        for ‘HSBC Bank USA, National Association, as Trustee, under the Pooling and
        Servicing Agreement dated as of May 1, 2007,’ or such other title as is
        requested by the Owner.”

       

      2.
         The
        definition of Escrow Account is revised to read as follows:


       

      “
‘Escrow
        Account’: The separate trust account or accounts created and maintained pursuant
        to Section
        4.06
        on which
        shall be entitled “Morgan Stanley Credit Corporation, as Servicer, in trust for
‘HSBC Bank USA, National Association, as Trustee, under the Pooling and
        Servicing Agreement dated as of May 1, 2007,’ or such other title as is
        requested by Owner.”

       

      3. Section
        4.18, second sentence is revised to read as follows:

       

      “All
        such
        Permitted Investments shall be registered in the name of the Servicer or
        its
        nominee, and held in trust for HSBC Bank USA, National Association, as Trustee,
        under the Pooling and Servicing Agreement dated May 1, 2007.”

       

      4. Notwithstanding
        any provision in the Agreement to the contrary, the Servicer agrees that
        it will
        report to the Master Servicer on a monthly basis on the date specified therein
        using the formats attached hereto as Exhibit 1.

       

      5. The
        third
        full paragraph of Section 6.01 is hereby deleted in its entirety and replaced
        by
        the following (second
        deleted
        in two places before Business Day):

       

      “With
        respect to any remittance received by Owner on or after the Business Day
        following the Business Day on which such payment was due, the Servicer shall
        pay
        to Owner interest on any such late payment at an annual rate equal to the
        rate
        of interest as is publicly announced from time to time at its principal office
        by Chase Manhattan Bank, N. A., New York, New York, as its “prime” lending rate
        (which is not necessarily its lowest rate) (or if Chase Manhattan Bank, N.A.
        shall cease to exist or to announce such rate, then such rate shall be a
        reasonably comparable rate determined by Servicer in its reasonable discretion),
        adjusted as of the date of each change, plus one (1) percentage point, but
        in no
        event greater than the maximum amount permitted by applicable law. Such interest
        shall be paid by the Servicer to Owner on the date such late payment is made
        and
        shall cover the period commencing with the day following such Business Day
        and
        ending with the Business Day on which such payment is made, both inclusive.
        Such
        interest shall be remitted along with such late payment. The payment by the
        Servicer of any such interest shall not be deemed an extension of time for
        Payment or a waiver of any Event of Default by the Servicer.”

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      6. Section
        10.01 is revised to add an “or” after 10.01(vi) and then to add the
        following:

       

      “failure
        on the part of the Servicer to comply with Article XIII after the cure periods
        provided in Section 13.07.”

       

      7. Section
        13.03 is revised to add the following after 13.03(d)(ii):

       

      “(iii) information
        regarding any Mortgage Loan changes (such as additions, substitutions, or
        repurchases), and any material changes in origination, underwriting or other
        criteria for acquisitions or selection of the Mortgage Loans (Item 1121(a)(14)
        of Regulation AB).”

       

      8. Section
        13.05 is revised to delete the first line of 13.05(iv), so that 13.05(iv)
        reads:

       

      “deliver,
        and cause each Subservicer and Subcontractor as described in clause (iii)
        to
        provide, to the Owner, such Master Servicer and such Depositor and any other
        Person that will be responsible for signing the certification (a “Sarbanes
        Certification”) required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
        (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) on behalf of
        an
        asset-backed issuer with respect to a Securitization Transaction a certification
        in the form attached hereto as Exhibit D.”

       

      9. The
        first
        paragraph under Section 13.07(b)(ii) is revised to read as follows (addition
        is
        in italics):

       

      “(ii) Any
        failure by the Servicer, any Subservicer or any Subcontractor to deliver
        any
        information, report, certification or accountants’ letter when and as required
        under Section 13.04 or 13.05, including (except as provided below) any failure
        by the Servicer to identify pursuant to Section 13.06(b) any Subcontractor
        “participating in the servicing function” within the meaning of Item 1122 of
        Regulation AB, which continues unremedied for ten calendar days after the
        date
        on which such information, report, certification or accountants’ letter was
        required to be delivered shall constitute an Event of Default with respect
        to
        the Servicer under this Agreement and any applicable Reconstitution Agreement,
        and shall entitle the Owner,
        the
        Master Servicer
        or
        Depositor, as applicable, in its sole discretion to terminate the rights
        and
        obligations of the Servicer as servicer under this Agreement and/or any
        applicable Reconstitution Agreement without payment (notwithstanding anything
        in
        this Agreement to the contrary) of any compensation to the Servicer (and
        if the
        Servicer is servicing any of the Mortgage Loans in a Securitization Transaction,
        appoint a successor servicer reasonably acceptable to any Master Servicer
        for
        such Securitization Transaction); provided that to the extent that any provision
        of this Agreement and/or any applicable Reconstitution Agreement expressly
        provides for the survival of certain rights or obligations following termination
        of the Servicer as servicer, such provision shall be given effect.”

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      EXHIBIT
        1

      12A.
        FORM OF MONTHLY REPORTS

       

      
        	 	 	
                Standard
                  Loan Level File Layout - Master Servicing

              	 	
                 

              	 	
                 

              	 	
                 

              
	 	 	 	 	
                 

              	 	
                 

              	 	
                 

              
	
                Exhibit
                  1: 
                  Layout

              	 	 	 	
                 

              	 	
                 

              	 	
                 

              
	
                Column
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              	 	
                Max
                  Size

              
	 	 	 	 	 	 	 	 	 
	
                Each
                  file requires the following fields:

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                SER_INVESTOR_NBR

              	 	
                A
                  value assigned by the Servicer to define a group of loans.

              	 	
                 

              	 	
                Text
                  up to 20 digits

              	 	
                20

              
	
                LOAN_NBR

              	 	
                A
                  unique identifier assigned to each loan by the investor.

              	 	
                 

              	 	
                Text
                  up to 10 digits

              	 	
                10

              
	
                SERVICER_LOAN_NBR

              	 	
                A
                  unique number assigned to a loan by the Servicer. This may be different
                  than the LOAN_NBR.

              	 	
                 

              	 	
                Text
                  up to 10 digits

              	 	
                10

              
	
                SCHED_PAY_AMT

              	 	
                Scheduled
                  monthly principal and scheduled interest payment that a borrower
                  is
                  expected to pay, P&I constant.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NOTE_INT_RATE

              	 	
                The
                  loan interest rate as reported by the Servicer.

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                NET_INT_RATE

              	 	
                The
                  loan gross interest rate less the service fee rate as reported
                  by the
                  Servicer.

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                SERV_FEE_RATE

              	 	
                The
                  servicer's fee rate for a loan as reported by the Servicer.
                  

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                SERV_FEE_AMT

              	 	
                The
                  servicer's fee amount for a loan as reported by the Servicer.
                  

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NEW_PAY_AMT

              	 	
                The
                  new loan payment amount as reported by the Servicer. 

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NEW_LOAN_RATE

              	 	
                The
                  new loan rate as reported by the Servicer. 

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                ARM_INDEX_RATE

              	 	
                The
                  index the Servicer is using to calculate a forecasted
                  rate.

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                ACTL_BEG_PRIN_BAL

              	 	
                The
                  borrower's actual principal balance at the beginning of the processing
                  cycle.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                ACTL_END_PRIN_BAL

              	 	
                The
                  borrower's actual principal balance at the end of the processing
                  cycle.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                BORR_NEXT_PAY_DUE_DATE

              	 	
                The
                  date at the end of processing cycle that the borrower's next payment
                  is
                  due to the Servicer, as reported by Servicer.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                SERV_CURT_AMT_1

              	 	
                The
                  first curtailment amount to be applied.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SERV_CURT_DATE_1

              	 	
                The
                  curtailment date associated with the first curtailment amount.
                  

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                CURT_ADJ_
                  AMT_1

              	 	
                The
                  curtailment interest on the first curtailment amount, if
                  applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SERV_CURT_AMT_2

              	 	
                The
                  second curtailment amount to be applied.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SERV_CURT_DATE_2

              	 	
                The
                  curtailment date associated with the second curtailment
                  amount.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                CURT_ADJ_
                  AMT_2

              	 	
                The
                  curtailment interest on the second curtailment amount, if
                  applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              


      


      
        
          
          

        

        
          
          

          
            

          

        

         

      

      


      
        	
                Exhibit
                  1: Continued

              	 	
                Standard
                  Loan Level File Layout 

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                Column
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              	 	
                 Max
                  Size

              
	
                SERV_CURT_AMT_3

              	 	
                The
                  third curtailment amount to be applied.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SERV_CURT_DATE_3

              	 	
                The
                  curtailment date associated with the third curtailment
                  amount.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                CURT_ADJ_AMT_3

              	 	
                The
                  curtailment interest on the third curtailment amount, if
                  applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PIF_AMT

              	 	
                The
                  loan "paid in full" amount as reported by the Servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PIF_DATE

              	 	
                The
                  paid in full date as reported by the Servicer.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                 

                ACTION_CODE

              	 	
                 

                The
                  standard FNMA numeric code used to indicate the default/delinquent
                  status
                  of a particular loan.

              	 	
                 

              	 	
                Action
                  Code Key: 15=Bankruptcy, 30=Foreclosure, , 60=PIF, 63=Substitution,
                  65=Repurchase,70=REO 

              	 	
                2

              
	
                INT_ADJ_AMT

              	 	
                The
                  amount of the interest adjustment as reported by the
                  Servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SOLDIER_SAILOR_ADJ_AMT

              	 	
                The
                  Soldier and Sailor Adjustment amount, if applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NON_ADV_LOAN_AMT

              	 	
                The
                  Non Recoverable Loan Amount, if applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                LOAN_LOSS_AMT

              	 	
                The
                  amount the Servicer is passing as a loss, if applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                Plus
                  the following applicable fields:

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                SCHED_BEG_PRIN_BAL

              	 	
                The
                  scheduled outstanding principal amount due at the beginning of
                  the cycle
                  date to be passed through to investors.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SCHED_END_PRIN_BAL

              	 	
                The
                  scheduled principal balance due to investors at the end of a processing
                  cycle.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SCHED_PRIN_AMT

              	 	
                The
                  scheduled principal amount as reported by the Servicer for the
                  current
                  cycle -- only applicable for Scheduled/Scheduled Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SCHED_NET_INT

              	 	
                The
                  scheduled gross interest amount less the service fee amount for
                  the
                  current cycle as reported by the Servicer -- only applicable for
                  Scheduled/Scheduled Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                ACTL_PRIN_AMT

              	 	
                The
                  actual principal amount collected by the Servicer for the current
                  reporting cycle -- only applicable for Actual/Actual
                  Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                ACTL_NET_INT

              	 	
                The
                  actual gross interest amount less the service fee amount for the
                  current
                  reporting cycle as reported by the Servicer -- only applicable
                  for
                  Actual/Actual Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PREPAY_PENALTY_
                  AMT

              	 	
                The
                  penalty amount received when a borrower prepays on his loan as
                  reported by
                  the Servicer. 

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PREPAY_PENALTY_
                  WAIVED

              	 	
                The
                  prepayment penalty amount for the loan waived by the
                  servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              


      


      
        
          
          

        

        
          
          

          
            

          

        

         

      

      


      
        	
                Exhibit
                  1: Continued

              	 	
                Standard
                  Loan Level File Layout 

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                Column
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              	 	
                Max
                  Size

              
	
                MOD_DATE

              	 	
                The
                  Effective Payment Date of the Modification for the loan.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                MOD_TYPE

              	 	
                The
                  Modification Type.

              	 	
                 

              	 	
                Varchar
                  - value can be alpha or numeric

              	 	
                30

              
	
                DELINQ_P&I_ADVANCE_AMT

              	 	
                The
                  current outstanding principal and interest advances made by
                  Servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                BREACH_FLAG

              	 	
                Flag
                  to indicate if the repurchase of a loan is due to a breach of
                  Representations and Warranties

              	 	 	 	
                Y=Breach

                N=NO
                  Breach

                Let
                  blank if N/A

              	 	
                1

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

         

      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Exhibit
        12B : Standard
        File Layout - Delinquency Reporting

      


        *The
        column/header names in bold
        are
        the minimum fields Wells Fargo must receive from every
        Servicer

       

      
        	
                Column/Header
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              
	
                SERVICER_LOAN_NBR

              	 	
                A
                  unique number assigned to a loan by the Servicer. This may be different
                  than the LOAN_NBR

              	 	 	 	
                 

              
	
                LOAN_NBR

              	 	
                A
                  unique identifier assigned to each loan by the originator.

              	 	 	 	
                 

              
	
                CLIENT_NBR

              	 	
                Servicer
                  Client Number

              	 	 	 	 
	
                SERV_INVESTOR_NBR

              	 	
                Contains
                  a unique number as assigned by an external servicer to identify
                  a group of
                  loans in their system.

              	 	 	 	
                 

              
	
                BORROWER_FIRST_NAME

              	 	
                First
                  Name of the Borrower.

              	 	 	 	 
	
                BORROWER_LAST_NAME

              	 	
                Last
                  name of the borrower.

              	 	 	 	 
	
                PROP_ADDRESS

              	 	
                Street
                  Name and Number of Property

              	 	 	 	
                 

              
	
                PROP_STATE

              	 	
                The
                  state where the property located.

              	 	 	 	
                 

              
	
                PROP_ZIP

              	 	
                Zip
                  code where the property is located.

              	 	 	 	
                 

              
	
                BORR_NEXT_PAY_DUE_DATE

              	 	
                The
                  date that the borrower's next payment is due to the servicer at
                  the end of
                  processing cycle, as reported by Servicer.

              	 	 	 	
                MM/DD/YYYY

              
	
                LOAN_TYPE

              	 	
                Loan
                  Type (i.e. FHA, VA, Conv)

              	 	 	 	
                 

              
	
                BANKRUPTCY_FILED_DATE

              	 	
                The
                  date a particular bankruptcy claim was filed.

              	 	 	 	
                MM/DD/YYYY

              
	
                BANKRUPTCY_CHAPTER_CODE

              	 	
                The
                  chapter under which the bankruptcy was filed.

              	 	 	 	
                 

              
	
                BANKRUPTCY_CASE_NBR

              	 	
                The
                  case number assigned by the court to the bankruptcy
                  filing.

              	 	 	 	
                 

              
	
                POST_PETITION_DUE_DATE

              	 	
                The
                  payment due date once the bankruptcy has been approved by the
                  courts

              	 	 	 	
                MM/DD/YYYY

              
	
                BANKRUPTCY_DCHRG_DISM_DATE

              	 	
                The
                  Date The Loan Is Removed From Bankruptcy. Either by Dismissal,
                  Discharged
                  and/or a Motion For Relief Was Granted. 

              	 	 	 	
                MM/DD/YYYY

              
	
                LOSS_MIT_APPR_DATE

              	 	
                The
                  Date The Loss Mitigation Was Approved By The Servicer

              	 	 	 	
                MM/DD/YYYY

              
	
                LOSS_MIT_TYPE

              	 	
                The
                  Type Of Loss Mitigation Approved For A Loan Such As;

              	 	 	 	 
	
                LOSS_MIT_EST_COMP_DATE

              	 	
                The
                  Date The Loss Mitigation /Plan Is Scheduled To End/Close

              	 	 	 	
                MM/DD/YYYY

              
	
                LOSS_MIT_ACT_COMP_DATE

              	 	
                The
                  Date The Loss Mitigation Is Actually Completed

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_APPROVED_DATE

              	 	
                The
                  date DA Admin sends a letter to the servicer with instructions
                  to begin
                  foreclosure proceedings.

              	 	 	 	
                MM/DD/YYYY

              
	
                ATTORNEY_REFERRAL_DATE

              	 	
                Date
                  File Was Referred To Attorney to Pursue Foreclosure

              	 	 	 	
                MM/DD/YYYY

              
	
                FIRST_LEGAL_DATE

              	 	
                Notice
                  of 1st legal filed by an Attorney in a Foreclosure Action

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_SALE_EXPECTED_DATE

              	 	
                The
                  date by which a foreclosure sale is expected to occur.

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_SALE_DATE

              	 	
                The
                  actual date of the foreclosure sale.

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_SALE_AMT

              	 	
                The
                  amount a property sold for at the foreclosure sale.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                EVICTION_START_DATE

              	 	
                The
                  date the servicer initiates eviction of the borrower.

              	 	 	 	
                MM/DD/YYYY

              
	
                EVICTION_COMPLETED_DATE

              	 	
                The
                  date the court revokes legal possession of the property from the
                  borrower.

              	 	 	 	
                MM/DD/YYYY

              
	
                LIST_PRICE

              	 	
                The
                  price at which an REO property is marketed.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                LIST_DATE

              	 	
                The
                  date an REO property is listed at a particular price.

              	 	 	 	
                MM/DD/YYYY

              
	
                OFFER_AMT

              	 	
                The
                  dollar value of an offer for an REO property.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                OFFER_DATE_TIME

              	 	
                The
                  date an offer is received by DA Admin or by the Servicer.

              	 	 	 	
                MM/DD/YYYY

              
	
                REO_CLOSING_DATE

              	 	
                The
                  date the REO sale of the property is scheduled to close.

              	 	 	 	
                MM/DD/YYYY

              
	
                REO_ACTUAL_CLOSING_DATE

              	 	
                Actual
                  Date Of REO Sale

              	 	 	 	
                MM/DD/YYYY

              
	
                OCCUPANT_CODE

              	 	
                Classification
                  of how the property is occupied.

              	 	 	 	
                 

              
	
                PROP_CONDITION_CODE

              	 	
                A
                  code that indicates the condition of the property.

              	 	 	 	
                 

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      
        	
                PROP_INSPECTION_DATE

              	 	
                The
                  date a property inspection is performed.

              	 	 	 	
                MM/DD/YYYY

              
	
                APPRAISAL_DATE

              	 	
                The
                  date the appraisal was done.

              	 	 	 	
                MM/DD/YYYY

              
	
                CURR_PROP_VAL

              	 	
                 The
                  current "as is" value of the property based on brokers price opinion
                  or
                  appraisal.

              	 	
                2

              	 	
                 

              
	
                REPAIRED_PROP_VAL

              	 	
                The
                  amount the property would be worth if repairs are completed pursuant
                  to a
                  broker's price opinion or appraisal.

              	 	
                2

              	 	
                 

              
	
                If
                  applicable:

              	 	
                 

              	 	 	 	
                 

              
	
                DELINQ_STATUS_CODE

              	 	
                FNMA
                  Code Describing Status of Loan

              	 	 	 	 
	
                DELINQ_REASON_CODE

              	 	
                The
                  circumstances which caused a borrower to stop paying on a loan.
                  Code
                  indicates the reason why the loan is in default for this
                  cycle.

              	 	 	 	 
	
                MI_CLAIM_FILED_DATE

              	 	
                Date
                  Mortgage Insurance Claim Was Filed With Mortgage Insurance
                  Company.

              	 	 	 	
                MM/DD/YYYY

              
	
                MI_CLAIM_AMT

              	 	
                Amount
                  of Mortgage Insurance Claim Filed

              	 	 	 	
                No
                  commas(,) or dollar signs ($)

              
	
                MI_CLAIM_PAID_DATE

              	 	
                Date
                  Mortgage Insurance Company Disbursed Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                MI_CLAIM_AMT_PAID

              	 	
                Amount
                  Mortgage Insurance Company Paid On Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                POOL_CLAIM_FILED_DATE

              	 	
                Date
                  Claim Was Filed With Pool Insurance Company

              	 	 	 	
                MM/DD/YYYY

              
	
                POOL_CLAIM_AMT

              	 	
                Amount
                  of Claim Filed With Pool Insurance Company

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                POOL_CLAIM_PAID_DATE

              	 	
                Date
                  Claim Was Settled and The Check Was Issued By The Pool
                  Insurer

              	 	 	 	
                MM/DD/YYYY

              
	
                POOL_CLAIM_AMT_PAID

              	 	
                Amount
                  Paid On Claim By Pool Insurance Company

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_A_CLAIM_FILED_DATE

              	 	
                 Date
                  FHA Part A Claim Was Filed With HUD

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_A_CLAIM_AMT

              	 	
                 Amount
                  of FHA Part A Claim Filed

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_A_CLAIM_PAID_DATE

              	 	
                 Date
                  HUD Disbursed Part A Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_A_CLAIM_PAID_AMT

              	 	
                 Amount
                  HUD Paid on Part A Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_B_CLAIM_FILED_DATE

              	 	
                  Date
                  FHA Part B Claim Was Filed With HUD

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_B_CLAIM_AMT

              	 	
                  Amount
                  of FHA Part B Claim Filed

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_B_CLAIM_PAID_DATE

              	 	
                   Date
                  HUD Disbursed Part B Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_B_CLAIM_PAID_AMT

              	 	
                 Amount
                  HUD Paid on Part B Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                VA_CLAIM_FILED_DATE

              	 	
                 Date
                  VA Claim Was Filed With the Veterans Admin

              	 	 	 	
                MM/DD/YYYY

              
	
                VA_CLAIM_PAID_DATE

              	 	
                 Date
                  Veterans Admin. Disbursed VA Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                VA_CLAIM_PAID_AMT

              	 	
                 Amount
                  Veterans Admin. Paid on VA Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              


      

       

      
        	
                MOTION_FOR_RELIEF_DATE

              	 	
                The
                  date the Motion for Relief was filed

              	 	
                10

              	 	
                MM/DD/YYYY

              
	
                FRCLSR_BID_AMT

              	 	
                The
                  foreclosure sale bid amount

              	 	
                11

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FRCLSR_SALE_TYPE

              	 	
                The
                  foreclosure sales results: REO, Third Party, Conveyance to
                  HUD/VA

              	 	
                 

              	 	
                 

              
	
                REO_PROCEEDS

              	 	
                The
                  net proceeds from the sale of the REO property. 

              	 	
                 

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                BPO_DATE

              	 	
                The
                  date the BPO was done.

              	 	
                 

              	 	
                 

              
	
                CURRENT_FICO

              	 	
                The
                  current FICO score

              	 	
                 

              	 	
                 

              
	
                HAZARD_CLAIM_FILED_DATE

              	 	
                The
                  date the Hazard Claim was filed with the Hazard Insurance
                  Company.

              	 	
                10

              	 	
                MM/DD/YYYY

              
	
                HAZARD_CLAIM_AMT

              	 	
                The
                  amount of the Hazard Insurance Claim filed.

              	 	
                11

              	 	
                No
                  commas(,) or dollar signs ($)

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

         

      

      
        	
                HAZARD_CLAIM_PAID_DATE

              	 	
                The
                  date the Hazard Insurance Company disbursed the claim
                  payment.

              	 	
                10

              	 	
                MM/DD/YYYY

              
	
                HAZARD_CLAIM_PAID_AMT

              	 	
                The
                  amount the Hazard Insurance Company paid on the claim.

              	 	
                11

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                ACTION_CODE

              	 	
                Indicates
                  loan status

              	 	 	 	
                Number

              
	
                NOD_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                NOI_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                ACTUAL_PAYMENT_PLAN_START_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                ACTUAL_PAYMENT_
                  PLAN_END_DATE

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                ACTUAL_REO_START_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                REO_SALES_PRICE

              	 	
                 

              	 	
                 

              	 	
                Number

              
	
                REALIZED_LOSS/GAIN

              	 	
                As
                  defined in the Servicing Agreement

              	 	
                 

              	 	
                Number

              


      

       

      Exhibit
        2: Standard
        File Codes - Delinquency Reporting

       

      The
        Loss
        Mit Type
        field
        should show the approved Loss Mitigation Code as follows: 

      
         

        
          	 	
                  ·

                	
                  ASUM- Approved
                    Assumption

                


        

        
          
             

            
              	 	
                      ·

                    	
                      BAP-  Borrower
                        Assistance Program

                    


            

            
              
                 

                
                  	 	
                          ·

                        	
                          CO- 
                            Charge
                            Off

                        


                

              

            

          

        

      

      
        
          
             

            
              	 	
                      ·

                    	
                      
                        DIL- 
                          Deed-in-Lieu

                      

                    


            

          

        

        
          
            
               

              
                	 	
                        ·

                      	
                        FFA- 
                          Formal Forbearance
                          Agreement

                      


              

            

          

          
            
              
                 

                
                  	 	
                          ·

                        	
                          MOD- 
                            Loan
                            Modification

                        


                

              

            

            
              
                
                   

                  
                    	 	
                            ·

                          	
                            
                              PRE-  
                                Pre-Sale

                            

                          


                  

                

              

              
                
                  
                    
                       

                      
                        	 	
                                ·

                              	
                                
                                  SS- Short
                                    Sale

                                

                              


                      

                    

                  

                  
                    
                      
                        
                           

                          
                            	 	
                                    ·

                                  	
                                    MISC-  Anything
                                      else approved by the PMI or Pool
                                      Insurer

                                  


                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      NOTE:
        Wells
        Fargo Bank will accept alternative Loss Mitigation Types to those above,
        provided that they are consistent with industry standards. If Loss Mitigation
        Types other than those above are used, the Servicer must supply Wells Fargo
        Bank
        with a description of each of the Loss Mitigation Types prior to sending
        the
        file.

       

      The
        Occupant
        Code
        field
        should show the current status of the property code as follows:

       

      
        	 	
                ·

              	
                Mortgagor

              


      

       

      
        	 	
                ·

              	
                Tenant

              


      

       

      
        	 	
                ·

              	
                Unknown
                  

              


      

       

      
        	 	
                ·

              	
                Vacant

              


      

       

      The
        Property
        Condition
        field
        should show the last reported condition of the property as follows:


       

      
        	
              	·	
                Damaged

              


      

       

      
        	
              	·	
                Excellent

              


      

       

      
        	
              	·	
                Fair

              


      

       

      
        	
              	·	
                Gone

              


      

       

      
        	
              	·	
                Good

              


      

       

      
        	
              	·	
                Poor

              


      

       

      
        	
              	·	
                Special
                  Hazard

              


      

       

      
        	
              	·	
                Unknown

              


      


      
        
          
          

        

        
          
          

          
            

          

        

         

      

       

      Exhibit
        2: Standard
        File Codes - Delinquency Reporting, Continued

       

      The
        FNMA
        Delinquent Reason Code
        field
        should show the Reason for Delinquency as follows: 

       

      
        	
                Delinquency
                  Code

              	 	
                Delinquency
                  Description

              
	
                001

              	 	
                FNMA-Death
                  of principal mortgagor

              
	
                002

              	 	
                FNMA-Illness
                  of principal mortgagor

              
	
                003

              	 	
                FNMA-Illness
                  of mortgagor’s family member

              
	
                004

              	 	
                FNMA-Death
                  of mortgagor’s family member

              
	
                005

              	 	
                FNMA-Marital
                  difficulties

              
	
                006

              	 	
                FNMA-Curtailment
                  of income

              
	
                007

              	 	
                FNMA-Excessive
                  Obligation

              
	
                008

              	 	
                FNMA-Abandonment
                  of property

              
	
                009

              	 	
                FNMA-Distant
                  employee transfer

              
	
                011

              	 	
                FNMA-Property
                  problem

              
	
                012

              	 	
                FNMA-Inability
                  to sell property

              
	
                013

              	 	
                FNMA-Inability
                  to rent property

              
	
                014

              	 	
                FNMA-Military
                  Service

              
	
                015

              	 	
                FNMA-Other

              
	
                016

              	 	
                FNMA-Unemployment

              
	
                017

              	 	
                FNMA-Business
                  failure

              
	
                019

              	 	
                FNMA-Casualty
                  loss

              
	
                022

              	 	
                FNMA-Energy
                  environment costs

              
	
                023

              	 	
                FNMA-Servicing
                  problems

              
	
                026

              	 	
                FNMA-Payment
                  adjustment

              
	
                027

              	 	
                FNMA-Payment
                  dispute

              
	
                029

              	 	
                FNMA-Transfer
                  of ownership pending

              
	
                030

              	 	
                FNMA-Fraud

              
	
                031

              	 	
                FNMA-Unable
                  to contact borrower

              
	
                INC

              	 	
                FNMA-Incarceration

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

         

      

      


      Exhibit
        2: Standard
        File Codes - Delinquency Reporting, Continued


       

      The
        FNMA
        Delinquent Status Code
        field
        should show the Status of Default as follows: 

      


      
        	
                Status
                  Code

              	 	
                Status
                  Description

              
	
                09

              	 	
                Forbearance

              
	
                17

              	 	
                Pre-foreclosure
                  Sale Closing Plan Accepted

              
	
                24

              	 	
                Government
                  Seizure

              
	
                26

              	 	
                Refinance

              
	
                27

              	 	
                Assumption

              
	
                28

              	 	
                Modification

              
	
                29

              	 	
                Charge-Off

              
	
                30

              	 	
                Third
                  Party Sale

              
	
                31

              	 	
                Probate

              
	
                32

              	 	
                Military
                  Indulgence

              
	
                43

              	 	
                Foreclosure
                  Started

              
	
                44

              	 	
                Deed-in-Lieu
                  Started

              
	
                49

              	 	
                Assignment
                  Completed

              
	
                61

              	 	
                Second
                  Lien Considerations

              
	
                62

              	 	
                Veteran’s
                  Affairs-No Bid

              
	
                63

              	 	
                Veteran’s
                  Affairs-Refund

              
	
                64

              	 	
                Veteran’s
                  Affairs-Buydown

              
	
                65

              	 	
                Chapter
                  7 Bankruptcy

              
	
                66

              	 	
                Chapter
                  11 Bankruptcy

              
	
                67

              	 	
                Chapter
                  13 Bankruptcy

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      Exhibit
        12C: Calculation of Realized Loss/Gain Form 332-
        Instruction Sheet

       

      NOTE:
        Do not net or combine items. Show all expenses individually and all credits
        as
        separate line items. Claim packages are due on the remittance report date.
        Late
        submissions may result in claims not being passed until the following month.
        The
        Servicer is responsible to remit all funds pending loss approval and /or
        resolution of any disputed items. 

       

      (i)
        _________________________________________________________________

       

      (ii)
        ________________________________________________________________ The
        numbers on the 332 form correspond with the numbers listed below.

       

      Liquidation
        and Acquisition Expenses:

       

      1.           
        The
        Actual Unpaid Principal Balance of the Mortgage Loan. For documentation,
        an
        Amortization Schedule from date of default through liquidation breaking out
        the
        net interest and servicing fees advanced is required.

       

      2.            The
        Total
        Interest Due less the aggregate amount of servicing fee that would have been
        earned if all delinquent payments had been made as agreed. For documentation,
        an
        Amortization Schedule from date of default through liquidation breaking out
        the
        net interest and servicing fees advanced is required.

       

      3.            Accrued
        Servicing Fees based upon the Scheduled Principal Balance of the Mortgage
        Loan
        as calculated on a monthly basis. For documentation, an Amortization Schedule
        from date of default through liquidation breaking out the net interest and
        servicing fees advanced is required.

       

      4-12.      
        Complete
        as applicable. Required documentation:

       

      *     
        For taxes and insurance advances - see page 2 of 332 form - breakdown required
        showing period of
        coverage, base tax, interest, penalty. Advances prior to default require
        evidence of servicer efforts to recover advances.

       

      *     
        For escrow advances - complete payment history 

       

      (to
        calculate advances from last positive escrow balance forward)

       

      *     
        Other expenses -  copies of corporate advance history showing all payments


       

      *     
        REO repairs > $1500 require explanation

       

      *     
        REO repairs >$3000 require evidence of at least 2 bids.

       

      *     
        Short Sale or Charge Off require P&L supporting the decision and
        WFB’s approved Officer Certificate 

       

      *      Unusual
        or extraordinary items may require further documentation. 

       

      13.          
        The
        total
        of lines 1 through 12.

       

      (iv) Credits:
        

       

      14-21.     
        Complete
        as applicable. Required documentation:

       

      *      
        Copy of the HUD 1 from the REO sale. If a 3rd
        Party
        Sale, bid instructions and Escrow
        Agent / Attorney  Letter
        of
        Proceeds
        Breakdown.

       

      *      
        Copy of EOB for any MI or gov't guarantee 

       

      *      
        All other credits need to be clearly defined on the 332
        form      
     

       

      
        	 	
                22.

              	
                The
                  total of lines 14 through 21.

              


      

       

      Please
        Note: For
        HUD/VA loans, use line (18a) for Part A/Initial proceeds and line (18b) for
        Part
        B/Supplemental proceeds.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Total
        Realized Loss (or Amount of Any Gain)

       

      23.        
        The
        total
        derived from subtracting line 22 from 13. If the amount represents a realized
        gain, show the amount in parenthesis ( ). 


      
        
          
          

        

        
          
          

          
            

          

        

         

      


      Exhibit
        3A: Calculation
        of Realized Loss/Gain Form 332


       

      Prepared
        by: __________________   Date:
        _______________

       

      Phone:
        ______________________  Email Address:_____________________

       

      
        	 	 	 	 	 
	
                Servicer
                  Loan No.

                 

              	 	
                Servicer
                  Name

              	 	
                Servicer
                  Address 

              


      

       

      WELLS
        FARGO BANK, N.A. Loan No._____________________________

       

      Borrower's
        Name: _________________________________________________________

      Property
        Address: _________________________________________________________

       

      Liquidation
        Type: REO Sale             
        3rd
        Party Sale        Short
        Sale                        Charge
        Off 

       

      Was
        this loan granted a Bankruptcy deficiency or cramdown  Yes          
        No

       

      If
“Yes”,
        provide deficiency or cramdown amount
        _______________________________

       

      Liquidation
        and Acquisition Expenses:

      

        
          	
                  (1)
                    Actual
                    Unpaid Principal Balance of Mortgage Loan

                	 	
                  $

                	
                  ______________

                	
                  (1)

                
	
                  (2)
                    Interest
                    accrued at Net Rate

                	 	 	
                  ______________

                	
                  (2)

                
	
                  (3)
                    Accrued
                    Servicing Fees

                	 	 	
                  
                    ______________

                  

                	
                  (3)

                
	
                  (4)
                    Attorney's
                    Fees

                	 	 	
                  
                    ______________

                  

                	
                  (4)

                
	
                  (5)
                    Taxes
                    (see page 2)

                	 	 	
                  
                    ______________

                  

                	
                  (5)

                
	
                  (6)
                    Property
                    Maintenance

                	 	 	
                  
                    ______________

                  

                	
                  (6)

                
	
                  (7)
                    MI/Hazard
                    Insurance Premiums (see page 2)

                	 	 	
                  
                    ______________

                  

                	
                  (7)

                
	
                  (8)
                    Utility
                    Expenses

                	 	 	
                  
                    ______________

                  

                	
                  (8)

                
	
                  (9)
                    Appraisal/BPO

                	 	 	
                  
                    ______________

                  

                	
                  (9)

                
	
                  (10)
                    Property
                    Inspections

                	 	 	
                  
                    ______________

                  

                	
                  (10)

                
	
                  (11)
                    FC
                    Costs/Other Legal Expenses

                	 	 	
                  
                    ______________

                  

                	
                  (11)

                
	
                  (12)
                    Other
                    (itemize)

                	 	 	
                  
                    ______________

                  

                	
                  (12)

                
	
                  Cash
                    for Keys__________________________

                	 	 	
                  
                    ______________

                  

                	
                  (12)

                
	
                  HOA/Condo
                    Fees_______________________

                	 	 	
                  
                    ______________

                  

                	
                  (12)

                
	
                  ______________________________________

                	 	 	
                  
                    ______________

                  

                	
                  (12)

                
	 	 	 	 	 
	
                  Total
                    Expenses

                	 	
                  $

                	
                  
                    ______________

                  

                	
                  (13)

                
	
                  Credits:

                	 	 	
                   

                	 
	
                  (14)
                    Escrow
                    Balance

                	 	
                  $

                	
                  
                    ______________

                  

                	
                  (14)

                
	
                  (15)
                    HIP
                    Refund

                	 	 	
                  
                    ______________

                  

                	
                  (15)

                
	
                  (16)
                    Rental
                    Receipts

                	 	 	
                  
                    ______________

                  

                	
                  (16)

                
	
                  (17)
                    Hazard
                    Loss Proceeds

                	 	 	
                  
                    ______________

                  

                	
                  (17)

                
	
                  (18)
                    Primary
                    Mortgage Insurance / Gov’t Insurance

                	 	 	
                  
                    ______________

                  

                	
                  (18a)
                    HUD Part A

                
	
                	 	 	
                  ______________

                	
                  (18b)
                    HUD Part B

                
	
                  (19) Pool
                    Insurance Proceeds

                	 	 	
                  ______________

                	
                  (19)

                
	
                  (20) Proceeds
                    from Sale of Acquired Property

                	 	 	
                  ______________

                	
                  (20)

                
	
                  (21) Other
                    (itemize)

                	 	 	
                  ______________

                	
                  (21)

                
	
                  ______________________________________

                	 	 	
                  ______________

                	
                  (21)

                
	 	 	 	 	 
	
                  Total
                    Credits

                	 	 	
                  ______________

                	
                  (22)

                
	
                  Total
                    Realized Loss (or Amount of Gain)

                	 	
                  $

                	
                  ______________

                	
                  (23)

                


        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

         

      


      Escrow
        Disbursement Detail


      


      
        	
                Type

                (Tax
                  /Ins.)

              	 	
                Date
                  Paid

              	 	
                Period
                  of Coverage

              	 	
                Total
                  Paid

              	 	
                Base
                  Amount

              	 	
                Penalties

              	 	
                Interest

              
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 


      

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

    

    MORGAN
      - SEQUOIA TO TRUSTEE

     

    ASSIGNMENT,
      ASSUMPTION AND RECOGNITION AGREEMENT

     

    For

    Master
      Servicing Agreement

     

    THIS
      ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT, dated as of July 27, 2007
      (“Assignment No. II”), is entered into among Sequoia Residential Funding, Inc.
      (the “Assignor”), Morgan Stanley Credit Corporation, as the servicer (the
“Servicer”), and HSBC Bank USA, National Association (“HSBC Bank”) as Trustee
      under a Pooling and Servicing Agreement dated as of July 1, 2007 (the “Pooling
      and Servicing Agreement”), among the Assignor, as Depositor, HSBC Bank (in such
      Trustee capacity, the “Assignee”) and Wells Fargo Bank, N. A., as Master
      Servicer and Securities Administrator.

     

    RECITALS

     

    WHEREAS,
      RWT Holdings, Inc. (“RWT”) and the Servicer have entered into a certain Master
      Servicing Agreement, dated as of November 1, 2006 (as amended or modified to
      the
      date hereof, the “Master Servicing Agreement”), and the Servicer is currently
      servicing certain mortgage loans (the “Mortgage Loans”) under the Master
      Servicing Agreement; and

     

    WHEREAS,
      RWT has previously sold, assigned and transferred all of its right, title and
      interest in certain of the Mortgage Loans (the “Specified Mortgage Loans”) which
      are listed on the mortgage loan schedule attached as Exhibit
      I
      hereto
      (the “Specified Mortgage Loan Schedule”) and its rights under the Master
      Servicing Agreement with respect to the Specified Mortgage Loans to Assignor;
      and

     

    WHEREAS,
      the Assignor has agreed to sell, assign and transfer to Assignee all of its
      right, title and interest in the Specified Mortgage Loans and its rights under
      the Master Servicing Agreement with respect to the Specified Mortgage Loans;
      and

     

    WHEREAS,
      the parties hereto have agreed that the Specified Mortgage Loans shall be
      subject to the terms of this Assignment No. II.

     

    NOW,
      THEREFORE, in consideration of the mutual promises contained herein and other
      good and valuable consideration (the receipt and sufficiency of which are hereby
      acknowledged), the parties agree as follows:

     

    1. Assignment
      and Assumption.

    


    (a) Effective
      on and as of the date hereof, the Assignor hereby pledges, assigns and transfers
      to the Assignee all of its right, title and interest in the Specified Mortgage
      Loans and all of its rights (but none of the Owner’s obligations) provided under
      the Master Servicing Agreement to the extent relating to the Specified Mortgage
      Loans, the Assignee hereby accepts such assignment from the Assignor, and the
      Servicer hereby acknowledges such assignment and assumption.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    


    (b) Effective
      on and as of the date hereof, the Assignor represents and warrants to the
      Assignee that the Assignor has not taken any action that would serve to impair
      or encumber the Assignee’s interest in the Specified Mortgage Loans since the
      date of the Assignor’s acquisition of the Specified Mortgage Loans.

     

    2. Recognition
      of the Assignee.

     

    From
      and
      after the date hereof, the Servicer shall recognize the Assignee as the holder
      of the rights and benefits of the Owner with respect to the Specified Mortgage
      Loans and the Servicer will service the Specified Mortgage Loans for the
      Assignee as if the Assignee and the Servicer had entered into a separate
      servicing agreement for the servicing of the Specified Mortgage Loans in the
      form of the Master Servicing Agreement (as modified by Appendix A hereto) (the
      “Successor MSA”) with the Assignee as the Owner thereunder, which Successor MSA
      is incorporated in and made a part of this Assignment No. II. It is the
      intention of the parties hereto that the Successor MSA will be treated as a
      separate and distinct servicing agreement between the parties hereto to the
      extent of the Specified Mortgage Loans and shall be binding upon and for the
      benefit of the respective successors and assigns of the parties
      hereto.

     

    3. Assignor’s
      Continuing Rights and Responsibilities.

     

    Notwithstanding
      Sections 1 and 2 above, the parties hereto agree that the Assignor rather than
      the Assignee shall have the ongoing rights and responsibilities of the Owner
      under the following sections of the Master Servicing Agreement:

     

    
      	
              Section

            	 	
              Matter

            
	 	 	 
	
              4.01

            	 	
              (a) Role
                of the Servicer.

            
	 	 	 
	
              7.05,
                1st¶
                and

              2nd¶

            	 	
              (b) Owner’s
                Right to Examine the Servicer Records.

            
	 	 	 
	
              8.01

            	 	
              (c) The
                Servicer Shall Provide Information as Reasonably 

              Required.

            
	 	 	 
	
              9.01(a)
                and (b)

            	 	
              (d) Indemnification;
                Third-Party Claims.

            
	 	 	 
	
              9.03

            	 	
              (e) Limitation
                on Liability of Servicer and Others.

            
	 	 	 
	
              12.03

            	 	
              (f) Assignments.

            
	 	 	 
	
              12.13(b)

            	 	
              (g) Non-Solicitation.

            


    

    


    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    In
      addition, the Servicer agrees to furnish to the Assignor and Master Servicer
      copies of reports, notices, statements and other communications required to
      be
      delivered by the Servicer pursuant to any of the sections of the Master
      Servicing Agreement referred to above and under the following sections, at
      the
      times therein specified:

     

    
      	
              Section

            	 	 
	 	 	 
	
              4.11,
                5th
                and 

              6th¶’s

            	 	
              (a) Title
                Management and Disposition of REO Property.

            
	 	 	 
	
              6.02

            	 	
              (b) Statements
                to Owner.

            
	 	 	 
	
              6.03(d)

            	 	
              (c) Monthly
                Advances by the Servicer.

            
	 	 	 
	
              13.04

            	 	
              (d)
                Annual Statement as to Compliance

            
	 	 	 
	
              13.05

            	 	
              (e)
                Report on Assessment of Compliance and Attestation

            
	 	 	 


    

    4. Successor
      MSA.

     

    The
      Successor MSA includes the Master Servicing Agreement as modified by Appendix
      A
      hereto and is made a part of this Assignment No. II.

     

    5. Representations
      and Warranties.

     

    (a) Each
      of
      the parties hereto represents and warrants that it is duly and legally
      authorized to enter into this Assignment No. II.

     

    (b) Each
      of
      the parties hereto represents and warrants that this Assignment No. II has
      been
      duly authorized, executed and delivered by it and (assuming due authorization,
      execution and delivery thereof by each of the other parties hereto) constitutes
      its legal, valid and binding obligation, enforceable against it in accordance
      with its terms, except as such enforcement may be limited by bankruptcy,
      insolvency, reorganization or other similar laws affecting the enforcement
      of
      creditors’ rights generally and by general equitable principles (regardless of
      whether such enforcement is considered in a proceeding in equity or at
      law).

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    6. Continuing
      Effect.

     

    Except
      as
      contemplated hereby, the Master Servicing Agreement shall remain in full force
      and effect in accordance with its terms.

     

    7. Governing
      Law.

     

    This
      Assignment No. II and the rights and obligations hereunder shall be governed
      by
      and construed in accordance with the internal laws of the State of
      Illinois.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    8. Notices.

     

    Any
      notices or other communications permitted or required under the Master Servicing
      Agreement to be made to the Assignor and Assignee shall be made in accordance
      with the terms of the Master Servicing Agreement and shall be sent to the
      Assignor and Assignee as follows:

     

    Sequoia
      Residential Funding, Inc.

    One
      Belvedere Place, Suite 330

    Mill
      Valley, CA 94941

     

    HSBC
      Bank
      USA, National Association

    452
      Fifth
      Avenue

    New
      York,
      NY 10018

    Attn:
      Corporate Trust & Loan Agency

     

    or
      to
      such other address as may hereafter be furnished by the Assignor or Assignee
      to
      the other parties in accordance with the provisions of the Master Servicing
      Agreement.

     

    9. Counterparts.

     

    This
      Assignment No. II may be executed in 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.

     

    10. Definitions.

     

    Any
      capitalized term used but not defined in this Assignment No. II has the same
      meaning as in the Master Servicing Agreement or the Master Mortgage Loan
      Purchase Agreement referred to therein.

     

    11. Master
      Servicer.

     

    The
      Servicer hereby acknowledges that the Assignee has appointed Wells Fargo Bank,
      N. A. (the “Master Servicer”) to act as master servicer and securities
      administrator under the Pooling and Servicing Agreement and hereby agrees to
      treat all inquiries, instructions, authorizations and other communications
      from
      the Master Servicer as if the same had been received from the Assignee. The
      Master Servicer, acting on behalf of the Assignee, shall have the rights of
      the
      Assignee as the Owner under the Successor MSA to enforce the obligations of
      the
      Servicer thereunder. Any notices or other communications permitted or required
      under the Master Servicing Agreement to be made to the Assignee shall be made
      in
      accordance with the terms of the Master Servicing Agreement and shall be sent
      to
      the Master Servicer at the following address:

     

    Wells
      Fargo Bank, N. A.

    P.O.
      Box
      98

    Columbia,
      Maryland 21046 

    (or,
      for
      overnight deliveries, 9062 Old Annapolis Road, Columbia, Maryland
      21045)

    Attention:
      Sequoia Mortgage Trust 2007-3

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    


    or
      to
      such other address as may hereafter be furnished by the Master Servicer to
      Servicer. Any such notices or other communications permitted or required under
      the Master Servicing Agreement may be delivered in electronic format unless
      manual signature is required in which case a hard copy of such report or
      communication shall be required.

     

    The
      Servicer further acknowledges that the Assignor has engaged the Master Servicer
      to provide certain default administration and that the Master Servicer, acting
      as agent of the Assignor, may exercise any of the rights of the Owner retained
      by the Assignor in Section 3 above.

    


    The
      Servicer shall make all distributions under the Successor MSA, as they relate
      to
      the Specified Mortgage Loans, to the Master Servicer by wire transfer of
      immediately funds to:


     

    Wells
      Fargo Bank, NA

    San
      Francisco, CA

    ABA#
      121-000-248

    Acct#
      3970771416

    Acct
      Name: SAS Clearing

    FFC:
      53164600

     

    [remainder
      of page intentionally left blank]

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties hereto have executed this Assignment No. II the
      day
      and year first above written.

     

    
      	 	 	 
	 	
              ASSIGNOR:

              SEQUOIA
                RESIDENTIAL FUNDING,
                INC.

            
	 
 	 
 	 
 
	
            	By:  	
            
	 	 	
              
 

	 	Name: 	 
	 	 	
              
 
	 	Title: 	 
	 	 	
              
 


    

     

    
      	 	 	 
	 	
              ASSIGNEE:

              
                HSBC
                  BANK USA, NATIONAL

                
                  ASSOCIATION

                

              

            
	 
 	 
 	 
 
	
            	By:  	
            
	 	 	
              
 

	 	Name: 	 
	 	 	
              
 
	 	Title: 	 
	 	 	
              
 


    

     

    
      	 	 	 
	 	
              
                SERVICER:

                MORGAN
                  STANLEY CREDIT CORPORATION

              

            
	 
 	 
 	 
 
	
            	By:  	
            
	 	 	
              
 

	 	Name: 	 
	 	 	
              
 
	 	Title: 	 
	 	 	
              
 


    

    


    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    


    EXHIBIT
      I


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    APPENDIX
      A

     

    MASTER
      SERVICING AGREEMENT


     

    1. The
      definition of Custodial Account is revised to read as follows:

     

    “
      ‘Custodial Account’: The separate trust account or accounts created and
      maintained pursuant to Section
      4.04
      of this
      Agreement which shall be entitled “Morgan Stanley Credit Corporation, in trust
      for ‘HSBC Bank USA, National Association, as Trustee, under the Pooling
      and Servicing Agreement dated as of July 1, 2007,’ or such other title as is
      requested by the Owner.”

     

    2. The
      following is added to the end of the definition of Eligible
      Account:


     

    “In
      addition, the Servicer covenants that within 30 days of any downgrade of a
      custodial account provider, Servicer will transfer the Custodial Account funds
      to another institution that has one of the two highest short-term ratings
      of S&P.”


     

    3.
       The
      definition of Escrow
      Account is revised to read as follows:


     

    “
‘Escrow
      Account’: The separate trust account or accounts created and maintained pursuant
      to Section
      4.06
      on which
      shall be entitled “Morgan Stanley Credit Corporation, as Servicer, in trust for
‘HSBC Bank USA, National Association, as Trustee, under the Pooling and
      Servicing Agreement dated as of July 1, 2007,’ or such other title as is
      requested by Owner.”


     

    4. Section
      4.18, second sentence is revised to read as follows:


     

    “All
      such
      Permitted Investments shall be registered in the name of the Servicer or its
      nominee, and held in trust for HSBC Bank USA, National Association, as Trustee,
      under the Pooling and Servicing Agreement dated July 1, 2007.”


     

    5. The
      following is added to the end of Section 4.18:

     

    “Notwithstanding
      anything to the contrary in this Agreement, for all Permitted Investments rated
      at least "A1/A+"(short/long) that have terms greater than 60 days, in the event
      of a downgrade of such Permitted Investment below "A1" (or "A+" if no short
      term
      rating) Servicer agrees to remove such Permitted Investment within 60 days
      of
      such downgrade. Servicer acknowledges and agrees that Servicer shall bear any
      losses incurred with respect to removal of such Permitted Investment following
      such a downgrade and that any losses shall be immediately deposited by the
      Servicer in the Custodial Account, as appropriate, out of the Servicer’s own
      funds, with no right to reimbursement therefore.”

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    6. Notwithstanding
      any provision in the Agreement to the contrary, the Servicer agrees that it
      will
      report to the Master Servicer on a monthly basis on the date specified therein
      using the formats attached hereto as Exhibit 1.


     

    7. The
      third
      full paragraph of Section 6.01 is hereby deleted in its entirety and replaced
      by
      the following (second
      deleted
      in two places before Business Day):


     

    “With
      respect to any remittance received by Owner on or after the Business Day
      following the Business Day on which such payment was due, the Servicer shall
      pay
      to Owner interest on any such late payment at an annual rate equal to the rate
      of interest as is publicly announced from time to time at its principal office
      by Chase Manhattan Bank, N. A., New York, New York, as its “prime” lending rate
      (which is not necessarily its lowest rate) (or if Chase Manhattan Bank, N.A.
      shall cease to exist or to announce such rate, then such rate shall be a
      reasonably comparable rate determined by Servicer in its reasonable discretion),
      adjusted as of the date of each change, plus one (1) percentage point, but
      in no
      event greater than the maximum amount permitted by applicable law. Such interest
      shall be paid by the Servicer to Owner on the date such late payment is made
      and
      shall cover the period commencing with the day following such Business Day
      and
      ending with the Business Day on which such payment is made, both inclusive.
      Such
      interest shall be remitted along with such late payment. The payment by the
      Servicer of any such interest shall not be deemed an extension of time for
      Payment or a waiver of any Event of Default by the Servicer.”

     

    8. Section
      10.01 is revised to add an “or” after 10.01(vi) and then to add the
      following:

     

    “failure
      on the part of the Servicer to comply with Article XIII after the cure periods
      provided in Section 13.07.”

     

    9. Section
      13.03 is revised to add the following after 13.03(d)(ii):

     

    “(iii) information
      regarding any Mortgage Loan changes (such as additions, substitutions, or
      repurchases), and any material changes in origination, underwriting or other
      criteria for acquisitions or selection of the Mortgage Loans (Item 1121(a)(14)
      of Regulation AB).”

     

    10. Section
      13.05 is revised to delete the first line of 13.05(iv), so that 13.05(iv)
      reads:

     

    “deliver,
      and cause each Subservicer and Subcontractor as described in clause (iii) to
      provide, to the Owner, such Master Servicer and such Depositor and any other
      Person that will be responsible for signing the certification (a “Sarbanes
      Certification”) required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
      (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) on behalf of an
      asset-backed issuer with respect to a Securitization Transaction a certification
      in the form attached hereto as Exhibit D.”

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    11. The
      first
      paragraph under Section 13.07(b)(ii) is revised to read as follows (addition
      is
      in italics):

     

    “(ii) Any
      failure by the Servicer, any Subservicer or any Subcontractor to deliver any
      information, report, certification or accountants’ letter when and as required
      under Section 13.04 or 13.05, including (except as provided below) any failure
      by the Servicer to identify pursuant to Section 13.06(b) any Subcontractor
      “participating in the servicing function” within the meaning of Item 1122 of
      Regulation AB, which continues unremedied for ten calendar days after the date
      on which such information, report, certification or accountants’ letter was
      required to be delivered shall constitute an Event of Default with respect
      to
      the Servicer under this Agreement and any applicable Reconstitution Agreement,
      and shall entitle the Owner,
      the
      Master Servicer
      or
      Depositor, as applicable, in its sole discretion to terminate the rights and
      obligations of the Servicer as servicer under this Agreement and/or any
      applicable Reconstitution Agreement without payment (notwithstanding anything
      in
      this Agreement to the contrary) of any compensation to the Servicer (and if
      the
      Servicer is servicing any of the Mortgage Loans in a Securitization Transaction,
      appoint a successor servicer reasonably acceptable to any Master Servicer for
      such Securitization Transaction); provided that to the extent that any provision
      of this Agreement and/or any applicable Reconstitution Agreement expressly
      provides for the survival of certain rights or obligations following termination
      of the Servicer as servicer, such provision shall be given effect.”

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      1

    12A.
      FORM OF MONTHLY REPORTS

    

      
        	 	 	
                Standard
                  Loan Level File Layout - Master Servicing

              	 	
                 

              	 	
                 

              	 	
                 

              
	 	 	 	 	
                 

              	 	
                 

              	 	
                 

              
	
                Exhibit
                  1: 
                  Layout

              	 	 	 	
                 

              	 	
                 

              	 	
                 

              
	
                Column
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              	 	
                Max
                  Size

              
	
                Each
                  file requires the following fields:

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                SER_INVESTOR_NBR

              	 	
                A
                  value assigned by the Servicer to define a group of loans.

              	 	
                 

              	 	
                Text
                  up to 20 digits

              	 	
                20

              
	
                LOAN_NBR

              	 	
                A
                  unique identifier assigned to each loan by the investor.

              	 	
                 

              	 	
                Text
                  up to 10 digits

              	 	
                10

              
	
                SERVICER_LOAN_NBR

              	 	
                A
                  unique number assigned to a loan by the Servicer. This may be different
                  than the LOAN_NBR.

              	 	
                 

              	 	
                Text
                  up to 10 digits

              	 	
                10

              
	
                SCHED_PAY_AMT

              	 	
                Scheduled
                  monthly principal and scheduled interest payment that a borrower
                  is
                  expected to pay, P&I constant.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NOTE_INT_RATE

              	 	
                The
                  loan interest rate as reported by the Servicer.

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                NET_INT_RATE

              	 	
                The
                  loan gross interest rate less the service fee rate as reported
                  by the
                  Servicer.

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                SERV_FEE_RATE

              	 	
                The
                  servicer's fee rate for a loan as reported by the Servicer.
                  

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                SERV_FEE_AMT

              	 	
                The
                  servicer's fee amount for a loan as reported by the Servicer.
                  

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NEW_PAY_AMT

              	 	
                The
                  new loan payment amount as reported by the Servicer. 

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NEW_LOAN_RATE

              	 	
                The
                  new loan rate as reported by the Servicer. 

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                ARM_INDEX_RATE

              	 	
                The
                  index the Servicer is using to calculate a forecasted
                  rate.

              	 	
                4

              	 	
                Max
                  length of 6

              	 	
                6

              
	
                ACTL_BEG_PRIN_BAL

              	 	
                The
                  borrower's actual principal balance at the beginning of the processing
                  cycle.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                ACTL_END_PRIN_BAL

              	 	
                The
                  borrower's actual principal balance at the end of the processing
                  cycle.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                BORR_NEXT_PAY_DUE_DATE

              	 	
                The
                  date at the end of processing cycle that the borrower's next payment
                  is
                  due to the Servicer, as reported by Servicer.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                SERV_CURT_AMT_1

              	 	
                The
                  first curtailment amount to be applied.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	 SERV_CURT_DATE_1	 	
                The
                  curtailment date associated with the first curtailment amount.
                  

              	 	 	 	
                MM/DD/YYYY

              	 	 
	
                CURT_ADJ_
                  AMT_1

              	 	
                The
                  curtailment interest on the first curtailment amount, if
                  applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SERV_CURT_AMT_2

              	 	
                The
                  second curtailment amount to be applied.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SERV_CURT_DATE_2

              	 	
                The
                  curtailment date associated with the second curtailment
                  amount.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                CURT_ADJ_
                  AMT_2

              	 	
                The
                  curtailment interest on the second curtailment amount, if
                  applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              


      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

      
        	
                Exhibit
                  1: Continued

              	 	
                Standard
                  Loan Level File Layout 

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                Column
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              	 	
                Max
                  Size

              
	
                SERV_CURT_AMT_3

              	 	
                The
                  third curtailment amount to be applied.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SERV_CURT_DATE_3

              	 	
                The
                  curtailment date associated with the third curtailment
                  amount.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                CURT_ADJ_AMT_3

              	 	
                The
                  curtailment interest on the third curtailment amount, if
                  applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PIF_AMT

              	 	
                The
                  loan "paid in full" amount as reported by the Servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PIF_DATE

              	 	
                The
                  paid in full date as reported by the Servicer.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                ACTION_CODE

              	 	
                The
                  standard FNMA numeric code used to indicate the default/delinquent
                  status
                  of a particular loan.

              	 	
                 

              	 	
                Action
                  Code Key: 15=Bankruptcy, 30=Foreclosure, , 60=PIF, 63=Substitution,
                  65=Repurchase,70=REO 

              	 	
                2

              
	
                INT_ADJ_AMT

              	 	
                The
                  amount of the interest adjustment as reported by the
                  Servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SOLDIER_SAILOR_ADJ_AMT

              	 	
                The
                  Soldier and Sailor Adjustment amount, if applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                NON_ADV_LOAN_AMT

              	 	
                The
                  Non Recoverable Loan Amount, if applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                LOAN_LOSS_AMT

              	 	
                The
                  amount the Servicer is passing as a loss, if applicable.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                Plus
                  the following applicable fields:

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                SCHED_BEG_PRIN_BAL

              	 	
                The
                  scheduled outstanding principal amount due at the beginning of
                  the cycle
                  date to be passed through to investors.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SCHED_END_PRIN_BAL

              	 	
                The
                  scheduled principal balance due to investors at the end of a processing
                  cycle.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SCHED_PRIN_AMT

              	 	
                The
                  scheduled principal amount as reported by the Servicer for the
                  current
                  cycle -- only applicable for Scheduled/Scheduled Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                SCHED_NET_INT

              	 	
                The
                  scheduled gross interest amount less the service fee amount for
                  the
                  current cycle as reported by the Servicer -- only applicable for
                  Scheduled/Scheduled Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                ACTL_PRIN_AMT

              	 	
                The
                  actual principal amount collected by the Servicer for the current
                  reporting cycle -- only applicable for Actual/Actual
                  Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                ACTL_NET_INT

              	 	
                The
                  actual gross interest amount less the service fee amount for the
                  current
                  reporting cycle as reported by the Servicer -- only applicable
                  for
                  Actual/Actual Loans.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PREPAY_PENALTY_
                  AMT

              	 	
                The
                  penalty amount received when a borrower prepays on his loan as
                  reported by
                  the Servicer. 

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                PREPAY_PENALTY_
                  WAIVED

              	 	
                The
                  prepayment penalty amount for the loan waived by the
                  servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              


      

    

     

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    
      
        	 	 	 	 	 	 	 	 	 
	
                Exhibit
                  1: Continued

              	 	
                Standard
                  Loan Level File Layout 

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                Column
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              	 	
                Max
                  Size

              
	
                MOD_DATE

              	 	
                The
                  Effective Payment Date of the Modification for the loan.

              	 	
                 

              	 	
                MM/DD/YYYY

              	 	
                10

              
	
                MOD_TYPE

              	 	
                The
                  Modification Type.

              	 	
                 

              	 	
                Varchar
                  - value can be alpha or numeric

              	 	
                30

              
	
                DELINQ_P&I_ADVANCE_AMT

              	 	
                The
                  current outstanding principal and interest advances made by
                  Servicer.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              	 	
                11

              
	
                BREACH_FLAG

              	 	
                Flag
                  to indicate if the repurchase of a loan is due to a breach of
                  Representations and Warranties

              	 	 	 	
                Y=Breach

                N=NO
                  Breach

                Let
                  blank if N/A

              	 	
                1

              


      

    

     

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    

     

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
      12B : Standard
      File Layout - Delinquency Reporting

    


      *The
      column/header names in bold
      are
      the minimum fields Wells Fargo must receive from every
      Servicer

    

      
        	
                Column/Header
                  Name

              	 	
                Description

              	 	
                Decimal

              	 	
                Format
                  Comment

              
	
                SERVICER_LOAN_NBR

              	 	
                A
                  unique number assigned to a loan by the Servicer. This may be different
                  than the LOAN_NBR

              	 	 	 	
                 

              
	
                LOAN_NBR

              	 	
                A
                  unique identifier assigned to each loan by the originator.

              	 	 	 	
                 

              
	
                CLIENT_NBR

              	 	
                Servicer
                  Client Number

              	 	 	 	 
	
                SERV_INVESTOR_NBR

              	 	
                Contains
                  a unique number as assigned by an external servicer to identify
                  a group of
                  loans in their system.

              	 	 	 	
                 

              
	
                BORROWER_FIRST_NAME

              	 	
                First
                  Name of the Borrower.

              	 	 	 	 
	
                BORROWER_LAST_NAME

              	 	
                Last
                  name of the borrower.

              	 	 	 	 
	
                PROP_ADDRESS

              	 	
                Street
                  Name and Number of Property

              	 	 	 	
                 

              
	
                PROP_STATE

              	 	
                The
                  state where the property located.

              	 	 	 	
                 

              
	
                PROP_ZIP

              	 	
                Zip
                  code where the property is located.

              	 	 	 	
                 

              
	
                BORR_NEXT_PAY_DUE_DATE

              	 	
                The
                  date that the borrower's next payment is due to the servicer at
                  the end of
                  processing cycle, as reported by Servicer.

              	 	 	 	
                MM/DD/YYYY

              
	
                LOAN_TYPE

              	 	
                Loan
                  Type (i.e. FHA, VA, Conv)

              	 	 	 	
                 

              
	
                BANKRUPTCY_FILED_DATE

              	 	
                The
                  date a particular bankruptcy claim was filed.

              	 	 	 	
                MM/DD/YYYY

              
	
                BANKRUPTCY_CHAPTER_CODE

              	 	
                The
                  chapter under which the bankruptcy was filed.

              	 	 	 	
                 

              
	
                BANKRUPTCY_CASE_NBR

              	 	
                The
                  case number assigned by the court to the bankruptcy
                  filing.

              	 	 	 	
                 

              
	
                POST_PETITION_DUE_DATE

              	 	
                The
                  payment due date once the bankruptcy has been approved by the
                  courts

              	 	 	 	
                MM/DD/YYYY

              
	
                BANKRUPTCY_DCHRG_DISM_DATE

              	 	
                The
                  Date The Loan Is Removed From Bankruptcy. Either by Dismissal,
                  Discharged
                  and/or a Motion For Relief Was Granted. 

              	 	 	 	
                MM/DD/YYYY

              
	
                LOSS_MIT_APPR_DATE

              	 	
                The
                  Date The Loss Mitigation Was Approved By The Servicer

              	 	 	 	
                MM/DD/YYYY

              
	
                LOSS_MIT_TYPE

              	 	
                The
                  Type Of Loss Mitigation Approved For A Loan Such As;

              	 	 	 	 
	
                LOSS_MIT_EST_COMP_DATE

              	 	
                The
                  Date The Loss Mitigation /Plan Is Scheduled To End/Close

              	 	 	 	
                MM/DD/YYYY

              
	
                LOSS_MIT_ACT_COMP_DATE

              	 	
                The
                  Date The Loss Mitigation Is Actually Completed

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_APPROVED_DATE

              	 	
                The
                  date DA Admin sends a letter to the servicer with instructions
                  to begin
                  foreclosure proceedings.

              	 	 	 	
                MM/DD/YYYY

              
	
                ATTORNEY_REFERRAL_DATE

              	 	
                Date
                  File Was Referred To Attorney to Pursue Foreclosure

              	 	 	 	
                MM/DD/YYYY

              
	
                FIRST_LEGAL_DATE

              	 	
                Notice
                  of 1st legal filed by an Attorney in a Foreclosure Action

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_SALE_EXPECTED_DATE

              	 	
                The
                  date by which a foreclosure sale is expected to occur.

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_SALE_DATE

              	 	
                The
                  actual date of the foreclosure sale.

              	 	 	 	
                MM/DD/YYYY

              
	
                FRCLSR_SALE_AMT

              	 	
                The
                  amount a property sold for at the foreclosure sale.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                EVICTION_START_DATE

              	 	
                The
                  date the servicer initiates eviction of the borrower.

              	 	 	 	
                MM/DD/YYYY

              
	
                EVICTION_COMPLETED_DATE

              	 	
                The
                  date the court revokes legal possession of the property from the
                  borrower.

              	 	 	 	
                MM/DD/YYYY

              
	
                LIST_PRICE

              	 	
                The
                  price at which an REO property is marketed.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                LIST_DATE

              	 	
                The
                  date an REO property is listed at a particular price.

              	 	 	 	
                MM/DD/YYYY

              
	
                OFFER_AMT

              	 	
                The
                  dollar value of an offer for an REO property.

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                OFFER_DATE_TIME

              	 	
                The
                  date an offer is received by DA Admin or by the Servicer.

              	 	 	 	
                MM/DD/YYYY

              
	
                REO_CLOSING_DATE

              	 	
                The
                  date the REO sale of the property is scheduled to close.

              	 	 	 	
                MM/DD/YYYY

              
	
                REO_ACTUAL_CLOSING_DATE

              	 	
                Actual
                  Date Of REO Sale

              	 	 	 	
                MM/DD/YYYY

              
	
                OCCUPANT_CODE

              	 	
                Classification
                  of how the property is occupied.

              	 	 	 	
                 

              
	
                PROP_CONDITION_CODE

              	 	
                A
                  code that indicates the condition of the property.

              	 	 	 	
                 

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                PROP_INSPECTION_DATE

              	 	
                The
                  date a property inspection is performed.

              	 	 	 	
                MM/DD/YYYY

              
	
                APPRAISAL_DATE

              	 	
                The
                  date the appraisal was done.

              	 	 	 	
                MM/DD/YYYY

              
	
                CURR_PROP_VAL

              	 	
                 The
                  current "as is" value of the property based on brokers price opinion
                  or
                  appraisal.

              	 	
                2

              	 	
                 

              
	
                REPAIRED_PROP_VAL

              	 	
                The
                  amount the property would be worth if repairs are completed pursuant
                  to a
                  broker's price opinion or appraisal.

              	 	
                2

              	 	
                 

              
	
                If
                  applicable:

              	 	
                 

              	 	 	 	
                 

              
	
                DELINQ_STATUS_CODE

              	 	
                FNMA
                  Code Describing Status of Loan

              	 	 	 	 
	
                DELINQ_REASON_CODE

              	 	
                The
                  circumstances which caused a borrower to stop paying on a loan.
                  Code
                  indicates the reason why the loan is in default for this
                  cycle.

              	 	 	 	 
	
                MI_CLAIM_FILED_DATE

              	 	
                Date
                  Mortgage Insurance Claim Was Filed With Mortgage Insurance
                  Company.

              	 	 	 	
                MM/DD/YYYY

              
	
                MI_CLAIM_AMT

              	 	
                Amount
                  of Mortgage Insurance Claim Filed

              	 	 	 	
                No
                  commas(,) or dollar signs ($)

              
	
                MI_CLAIM_PAID_DATE

              	 	
                Date
                  Mortgage Insurance Company Disbursed Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                MI_CLAIM_AMT_PAID

              	 	
                Amount
                  Mortgage Insurance Company Paid On Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                POOL_CLAIM_FILED_DATE

              	 	
                Date
                  Claim Was Filed With Pool Insurance Company

              	 	 	 	
                MM/DD/YYYY

              
	
                POOL_CLAIM_AMT

              	 	
                Amount
                  of Claim Filed With Pool Insurance Company

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                POOL_CLAIM_PAID_DATE

              	 	
                Date
                  Claim Was Settled and The Check Was Issued By The Pool
                  Insurer

              	 	 	 	
                MM/DD/YYYY

              
	
                POOL_CLAIM_AMT_PAID

              	 	
                Amount
                  Paid On Claim By Pool Insurance Company

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_A_CLAIM_FILED_DATE

              	 	
                 Date
                  FHA Part A Claim Was Filed With HUD

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_A_CLAIM_AMT

              	 	
                 Amount
                  of FHA Part A Claim Filed

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_A_CLAIM_PAID_DATE

              	 	
                 Date
                  HUD Disbursed Part A Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_A_CLAIM_PAID_AMT

              	 	
                 Amount
                  HUD Paid on Part A Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_B_CLAIM_FILED_DATE

              	 	
                  Date
                  FHA Part B Claim Was Filed With HUD

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_B_CLAIM_AMT

              	 	
                  Amount
                  of FHA Part B Claim Filed

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                FHA_PART_B_CLAIM_PAID_DATE

              	 	
                   Date
                  HUD Disbursed Part B Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                FHA_PART_B_CLAIM_PAID_AMT

              	 	
                 Amount
                  HUD Paid on Part B Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                VA_CLAIM_FILED_DATE

              	 	
                 Date
                  VA Claim Was Filed With the Veterans Admin

              	 	 	 	
                MM/DD/YYYY

              
	
                VA_CLAIM_PAID_DATE

              	 	
                 Date
                  Veterans Admin. Disbursed VA Claim Payment

              	 	 	 	
                MM/DD/YYYY

              
	
                VA_CLAIM_PAID_AMT

              	 	
                 Amount
                  Veterans Admin. Paid on VA Claim

              	 	
                2

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                MOTION_FOR_RELIEF_DATE

              	 	
                The
                  date the Motion for Relief was filed

              	 	
                10

              	 	
                MM/DD/YYYY

              
	
                FRCLSR_BID_AMT

              	 	
                The
                  foreclosure sale bid amount

              	 	
                11

              	 	
                No
                  commas(,) or dollar signs ($)

              


      

       

      
        	
                FRCLSR_SALE_TYPE

              	 	
                The
                  foreclosure sales results: REO, Third Party, Conveyance to
                  HUD/VA

              	 	
                 

              	 	
                 

              
	
                REO_PROCEEDS

              	 	
                The
                  net proceeds from the sale of the REO property. 

              	 	
                 

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                BPO_DATE

              	 	
                The
                  date the BPO was done.

              	 	
                 

              	 	
                 

              
	
                CURRENT_FICO

              	 	
                The
                  current FICO score

              	 	
                 

              	 	
                 

              
	
                HAZARD_CLAIM_FILED_DATE

              	 	
                The
                  date the Hazard Claim was filed with the Hazard Insurance
                  Company.

              	 	
                10

              	 	
                MM/DD/YYYY

              
	
                HAZARD_CLAIM_AMT

              	 	
                The
                  amount of the Hazard Insurance Claim filed.

              	 	
                11

              	 	
                No
                  commas(,) or dollar signs ($)

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                HAZARD_CLAIM_PAID_DATE

              	 	
                The
                  date the Hazard Insurance Company disbursed the claim
                  payment.

              	 	
                10

              	 	
                MM/DD/YYYY

              
	 	 	 	 	 	 	 
	
                HAZARD_CLAIM_PAID_AMT

              	 	
                The
                  amount the Hazard Insurance Company paid on the claim.

              	 	
                11

              	 	
                No
                  commas(,) or dollar signs ($)

              
	
                ACTION_CODE

              	 	
                Indicates
                  loan status

              	 	 	 	
                Number

              
	
                NOD_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                NOI_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                ACTUAL_PAYMENT_PLAN_START_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                ACTUAL_PAYMENT_
                  PLAN_END_DATE

              	 	
                 

              	 	
                 

              	 	
                 

              
	
                ACTUAL_REO_START_DATE

              	 	
                 

              	 	
                 

              	 	
                MM/DD/YYYY

              
	
                REO_SALES_PRICE

              	 	
                 

              	 	
                 

              	 	
                Number

              
	
                REALIZED_LOSS/GAIN

              	 	
                As
                  defined in the Servicing Agreement

              	 	
                 

              	 	
                Number

              


      

    

     

    Exhibit
      2: Standard
      File Codes - Delinquency Reporting

     

    The
      Loss
      Mit Type
      field
      should show the approved Loss Mitigation Code as follows: 

    
       

      
        
          	
                	·	
                  ASUM-Approved
                    Assumption

                


        

      

       

    

    
      
        	
              	·	
                BAP-Borrower
                  Assistance Program

              


      

    

     

    
      
        
          	
                	·	
                  CO-
                    Charge Off

                


        

      

       

      
        
          
            	
                  	·	
                    DIL-
                      Deed-in-Lieu

                  


          

        

         

        
          
            
              	
                    	·	
                      FFA-
                        Formal Forbearance Agreement

                    


            

          

           

          
            
              
                	
                      	·	
                        MOD-
                          Loan Modification

                      


              

            

             

            
              
                
                  
                    	
                          	·	
                            PRE-
                              Pre-Sale

                          


                  

                

                 

                
                  
                    
                      
                        	
                              	·	
                                SS-
                                  Short Sale

                              


                      

                    

                     

                    
                      
                        
                          
                            	
                                  	·	
                                    MISC-Anything
                                      else approved by the PMI or Pool
                                      Insurer

                                  


                          

                        

                         

                      

                    

                  

                

              

            

          

        

      

    

    NOTE:
      Wells
      Fargo Bank will accept alternative Loss Mitigation Types to those above,
      provided that they are consistent with industry standards. If Loss Mitigation
      Types other than those above are used, the Servicer must supply Wells Fargo
      Bank
      with a description of each of the Loss Mitigation Types prior to sending the
      file.


     

    The
      Occupant
      Code
      field
      should show the current status of the property code as follows:

    
       

      
        
          
            
              	
                    	·	
                      Mortgagor

                    


            

          

           

        

      

    

    
      
        
          
            
              	
                    	·	
                      Tenant

                    


            

          

          
             

            
              
                
                  
                    	
                          	·	
                            Unknown
                              

                          


                  

                

                
                   

                  
                    
                      
                        
                          	
                                	·	
                                  Vacant

                                


                        

                      

                    

                  

                

              

            

          

        

      

    

     

    The
      Property
      Condition
      field
      should show the last reported condition of the property as follows:


    
      
         

        
          
            
              
                	
                      	·	
                        Damaged

                      


              

            

             

            
              
                
                  
                    
                      
                        	
                              	·	
                                Excellent

                              


                      

                    

                     

                    
                      
                        
                          
                            
                              
                                	
                                      	·	
                                        Fair

                                      


                              

                            

                             

                            
                              
                                
                                  
                                    
                                      
                                        	
                                              	·	
                                                Gone

                                              


                                      

                                    

                                     

                                    
                                      
                                        
                                          
                                            
                                              
                                                	
                                                      	·	
                                                        Good

                                                      


                                              

                                            

                                            
                                               

                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          	
                                                                	·	
                                                                  Poor

                                                                


                                                        

                                                      

                                                      
                                                         

                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    	
                                                                          	·	
                                                                            Special
                                                                              Hazard

                                                                          


                                                                  

                                                                

                                                                
                                                                   

                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              	
                                                                                    	·	
                                                                                      Unknown

                                                                                    


                                                                            

                                                                          

                                                                           

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
      2: Standard
      File Codes - Delinquency Reporting, Continued


     

    The
      FNMA
      Delinquent Reason Code
      field
      should show the Reason for Delinquency as follows: 

    

      
        	
                Delinquency
                  Code

              	 	
                Delinquency
                  Description

              
	
                001

              	 	
                FNMA-Death
                  of principal mortgagor

              
	
                002

              	 	
                FNMA-Illness
                  of principal mortgagor

              
	
                003

              	 	
                FNMA-Illness
                  of mortgagor’s family member

              
	
                004

              	 	
                FNMA-Death
                  of mortgagor’s family member

              
	
                005

              	 	
                FNMA-Marital
                  difficulties

              
	
                006

              	 	
                FNMA-Curtailment
                  of income

              
	
                007

              	 	
                FNMA-Excessive
                  Obligation

              
	
                008

              	 	
                FNMA-Abandonment
                  of property

              
	
                009

              	 	
                FNMA-Distant
                  employee transfer

              
	
                011

              	 	
                FNMA-Property
                  problem

              
	
                012

              	 	
                FNMA-Inability
                  to sell property

              
	
                013

              	 	
                FNMA-Inability
                  to rent property

              
	
                014

              	 	
                FNMA-Military
                  Service

              
	
                015

              	 	
                FNMA-Other

              
	
                016

              	 	
                FNMA-Unemployment

              
	
                017

              	 	
                FNMA-Business
                  failure

              
	
                019

              	 	
                FNMA-Casualty
                  loss

              
	
                022

              	 	
                FNMA-Energy
                  environment costs

              
	
                023

              	 	
                FNMA-Servicing
                  problems

              
	
                026

              	 	
                FNMA-Payment
                  adjustment

              
	
                027

              	 	
                FNMA-Payment
                  dispute

              
	
                029

              	 	
                FNMA-Transfer
                  of ownership pending

              
	
                030

              	 	
                FNMA-Fraud

              
	
                031

              	 	
                FNMA-Unable
                  to contact borrower

              
	
                INC

              	 	
                FNMA-Incarceration

              


      

       

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    


    Exhibit
      2: Standard
      File Codes - Delinquency Reporting, Continued


     

    The
      FNMA
      Delinquent Status Code
      field
      should show the Status of Default as follows: 


    

      
        	
                Status
                  Code

              	 	
                Status
                  Description

              
	
                09

              	 	
                Forbearance

              
	
                17

              	 	
                Pre-foreclosure
                  Sale Closing Plan Accepted

              
	
                24

              	 	
                Government
                  Seizure

              
	
                26

              	 	
                Refinance

              
	
                27

              	 	
                Assumption

              
	
                28

              	 	
                Modification

              
	
                29

              	 	
                Charge-Off

              
	
                30

              	 	
                Third
                  Party Sale

              
	
                31

              	 	
                Probate

              
	
                32

              	 	
                Military
                  Indulgence

              
	
                43

              	 	
                Foreclosure
                  Started

              
	
                44

              	 	
                Deed-in-Lieu
                  Started

              
	
                49

              	 	
                Assignment
                  Completed

              
	
                61

              	 	
                Second
                  Lien Considerations

              
	
                62

              	 	
                Veteran’s
                  Affairs-No Bid

              
	
                63

              	 	
                Veteran’s
                  Affairs-Refund

              
	
                64

              	 	
                Veteran’s
                  Affairs-Buydown

              
	
                65

              	 	
                Chapter
                  7 Bankruptcy

              
	
                66

              	 	
                Chapter
                  11 Bankruptcy

              
	
                67

              	 	
                Chapter
                  13 Bankruptcy

              


      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

      Exhibit
        12C: Calculation
        of Realized Loss/Gain Form 332- Instruction Sheet

    

     

    NOTE:
      Do not net or combine items. Show all expenses individually and all credits
      as
      separate line items. Claim packages are due on the remittance report date.
      Late
      submissions may result in claims not being passed until the following month.
      The
      Servicer is responsible to remit all funds pending loss approval and /or
      resolution of any disputed items. 

    (v)     
      _____________________________________

     

    (vi)    
      _____________________________________ The
      numbers on the 332 form correspond with the numbers listed below.

     

    Liquidation
      and Acquisition Expenses:

     

    
      	
            	1.	
              The
                Actual Unpaid Principal Balance of the Mortgage Loan. For documentation,
                an Amortization Schedule from date of default through liquidation
                breaking
                out the net interest and servicing fees advanced is
                required.

            


    

     

    
      
        	
              	2.	
                The
                  Total Interest Due less the aggregate amount of servicing fee that
                  would
                  have been earned if all delinquent payments had been made as agreed.
                  For
                  documentation, an Amortization Schedule from date of default through
                  liquidation breaking out the net interest and servicing fees advanced
                  is
                  required.

              


      

       

      
        
          
            	
                  	3.	Accrued Servicing Fees based
                    upon the
                    Scheduled Principal Balance of the Mortgage Loan as calculated
                    on a
                    monthly basis. For documentation, an Amortization Schedule from
                    date of
                    default through liquidation breaking out the net interest and
                    servicing
                    fees advanced is required.


          

          
4-12. Complete
            as applicable. Required documentation:

        

      

    

     

    *
      For
      taxes and insurance advances - see page 2 of 332 form - breakdown required
      showing period of
      coverage, base tax, interest, penalty. Advances prior to default require
      evidence of servicer efforts to recover advances.

     

    *
      For
      escrow advances - complete payment history 

     

    (to
      calculate advances from last positive escrow balance forward)

     

    *
      Other
      expenses -  copies of corporate advance history showing all payments


     

    *
      REO
      repairs > $1500 require explanation

     

    *
      REO
      repairs >$3000 require evidence of at least 2 bids.

     

    *
      Short
      Sale or Charge Off require P&L supporting the decision and
      WFB’s approved Officer Certificate 

     

    *
      Unusual
      or extraordinary items may require further documentation. 

     

    13.  The
      total
      of lines 1 through 12.

     

    (vii)  Credits:
      

     

    14-21. Complete
      as applicable. Required documentation:

     

    *
      Copy of
      the HUD 1 from the REO sale. If a 3rd
      Party
      Sale, bid instructions and Escrow
      Agent / Attorney

     

    Letter
      of
      Proceeds
      Breakdown.

     

    *
      Copy of
      EOB for any MI or gov't guarantee 

     

    *
      All
      other credits need to be clearly defined on the 332
      form    

     

    
      	 	
              22.

            	
              The
                total of lines 14 through 21.

            


    

     

    Please
      Note: For
      HUD/VA loans, use line (18a) for Part A/Initial proceeds and line (18b) for
      Part
      B/Supplemental proceeds.

     

    Total
      Realized Loss (or Amount of Any Gain)

     

    23. The
      total
      derived from subtracting line 22 from 13. If the amount represents a realized
      gain, show the amount in parenthesis ( ). 

    


    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    Exhibit
      3A: Calculation
      of Realized Loss/Gain Form 332

     

    
      	Prepared by: __________________	 	
              Date:
                _______________

            
	 	 	 
	Phone: ______________________ 	 	Email
              Address:_____________________


    

     

    
      	 	 	 	 	 
	
              Servicer
                Loan No.

            	 	
              Servicer
                Name

            	 	
              Servicer
                Address 

               

            


    

     

    WELLS
      FARGO BANK, N.A. Loan No._____________________________

     

    Borrower's
      Name: _________________________________________________________

    Property
      Address: _________________________________________________________

     

    
      	Liquidation Type: REO
              Sale	 	 
              3rd
              Party Sale	 	Short Sale 	 	Charge Off 
	 	 	 	 	 	 	 
	Was this loan granted
              a
              Bankruptcy deficiency or cramdown  	
              Yes

            	 	No
	 	 	 	 
	
              If
                “Yes”, provide deficiency or cramdown amount
                _______________________________

            	 	 


    

    

      
        	
                Liquidation
                  and Acquisition Expenses:

              	 
	
                (1)
                  Actual Unpaid Principal Balance of Mortgage Loan

              	
                $
                  ______________

              	
                (1)

              
	
                (2)
                  Interest accrued at Net Rate

              	
                ________________

              	
                (2)

              
	
                (3)
                  Accrued Servicing Fees

              	
                ________________

              	
                (3)

              
	
                (4)
                  Attorney's Fees

              	
                ________________

              	
                (4)

              
	
                (5)
                  Taxes (see page 2)

              	
                ________________

              	
                (5)

              
	
                (6)
                  Property Maintenance

              	
                ________________

              	
                (6)

              
	
                (7)
                  MI/Hazard Insurance Premiums (see page 2)

              	
                ________________

              	
                (7)

              
	
                (8)
                  Utility Expenses

              	
                ________________

              	
                (8)

              
	
                (9)
                  Appraisal/BPO

              	
                ________________

              	
                (9)

              
	
                (10)
                  Property Inspections

              	
                ________________

              	
                (10)

              
	
                (11)
                  FC Costs/Other Legal Expenses

              	
                ________________

              	
                (11)

              
	
                (12)
                  Other (itemize)

              	
                ________________

              	
                (12)

              
	
                 Cash
                  for Keys__________________________

              	
                ________________

              	
                (12)

              
	
                 HOA/Condo
                  Fees_______________________

              	
                ________________

              	
                (12)

              
	
                ______________________________________

              	
                ________________

              	
                (12)

              
	 	 	 	 
	
                Total
                  Expenses

              	
                $
                  _______________

              	
                (13)

              
	
                Credits:

              	 	 	 
	
                (14)
                  Escrow Balance

              	
                $
                  _______________

              	
                (14)

              
	
                (15)
                  HIP Refund

              	
                ________________

              	
                (15)

              
	
                (16)
                  Rental Receipts

              	
                ________________

              	
                (16)

              
	
                (17)
                  Hazard Loss Proceeds

              	
                ________________

              	
                (17)

              
	
                (18)
                  Primary Mortgage Insurance / Gov’t Insurance

              	
                ________________

              	
                (18a)
                  HUD Part A

              
	 	 	
                ________________

              	
                (18b)
                  HUD Part B

              
	
                (19)
                  Pool Insurance Proceeds

              	
                ________________

              	
                (19)

              
	
                (20)
                  Proceeds from Sale of Acquired Property

              	
                ________________

              	
                (20)

              
	
                (21)
                  Other (itemize)

              	
                ________________

              	
                (21)

              
	
                _________________________________________

              	
                ________________

              	
                (21)

              
	 	 	 	 
	
                Total
                  Credits

              	
                $________________

              	
                (22)

              
	
                Total
                  Realized Loss (or Amount of Gain)

              	
                $________________

              	
                (23)

              


      

    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    


    Escrow
      Disbursement Detail

    

      
        	
                Type

                (Tax
                  /Ins.)

              	 	
                Date
                  Paid

              	 	
                Period
                  of Coverage

              	 	
                Total
                  Paid

              	 	
                Base
                  Amount

              	 	
                Penalties

              	 	
                Interest

              
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 


      

       

       

      
        
          
          

        

        
          2