SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
                                    Depositor



                               CITIMORTGAGE, INC.
                     Master Servicer and Trust Administrator


                                       and



                              THE BANK OF NEW YORK
                                     Trustee



                    _________________________________________

                         POOLING AND SERVICING AGREEMENT
                             Dated as of May 1, 2001
                    _________________________________________



                       Mortgage Pass-Through Certificates

                                Series 2001-CPB1








<PAGE>


<TABLE>
<CAPTION>
                                                   TABLE OF CONTENTS
                                                   -----------------

          SECTION                                                                                                  PAGE
          -------                                                                                                  ----
<S>                                                                                                                <C>
ARTICLE I

          DEFINITIONS

          1.01.    Defined Terms......................................................................................2
                   Adjustment Date....................................................................................2
                   Affiliate..........................................................................................2
                   Agreement..........................................................................................2
                   Allocated Realized Loss Amount.....................................................................2
                   Assignment.........................................................................................2
                   Available Distribution Amount......................................................................2
                   Bankruptcy Amount..................................................................................3
                   Bankruptcy Code....................................................................................3
                   Bankruptcy Loss....................................................................................3
                   Book-Entry Certificate.............................................................................3
                   Book-Entry Custodian...............................................................................3
                   Business Day.......................................................................................3
                   Cash-out Refinancing...............................................................................3
                   Certificate........................................................................................4
                   Certificate Factor.................................................................................4
                   Certificateholder or Holder........................................................................4
                   Certificate Owner..................................................................................4
                   Certificate Principal Balance......................................................................4
                   Certificate Register"..............................................................................5
                   Class    ..........................................................................................5
                   Class A Certificate................................................................................5
                   Class B Percentage.................................................................................5
                   Class B-1 Certificate..............................................................................5
                   Class B-1 Percentage...............................................................................5
                   Class B-2 Certificate..............................................................................5
                   Class B-2 Percentage...............................................................................5
                   Class B-3 Certificate..............................................................................5
                   Class B-3 Percentage...............................................................................5
                   Class B-4 Certificate..............................................................................6
                   Class B-4 Percentage...............................................................................6
                   Class B-5 Certificate..............................................................................6
                   Class B-5 Percentage...............................................................................6
                   Class B-6 Certificate..............................................................................6
                   Class B-6 Percentage...............................................................................6
                   Class R-I Certificate..............................................................................7
                   Closing Date.......................................................................................7
                   Code     ..........................................................................................7


                                                           i

<PAGE>


          SECTION                                                                                                  PAGE
          -------                                                                                                  ----

                   Collection Account.................................................................................7
                   Commission.........................................................................................7
                   Cooperative........................................................................................7
                   Cooperative Loans..................................................................................7
                   Corporate Trust Office.............................................................................7
                   Cut-off Date.......................................................................................7
                   Debt Service Reduction.............................................................................7
                   Deficient Valuation................................................................................8
                   Definitive Certificates............................................................................8
                   Deleted Mortgage Loan..............................................................................8
                   Depositor..........................................................................................8
                   Depository.........................................................................................8
                   Depository Institution.............................................................................8
                   Depository Participant.............................................................................8
                   Determination Date.................................................................................8
                   Directly Operate...................................................................................8
                   Disqualified Organization..........................................................................9
                   Distribution Account...............................................................................9
                   Distribution Date..................................................................................9
                   DOL      ..........................................................................................9
                   DOL Regulations....................................................................................9
                   Due Date ..........................................................................................9
                   Due Period.........................................................................................9
                   Eligible Account...................................................................................9
                   ERISA    ..........................................................................................9
                   Estate in Real Property...........................................................................10
                   Excess Bankruptcy Loss............................................................................10
                   Excess Fraud Loss.................................................................................10
                   Excess Loss.......................................................................................10
                   Excess Special Hazard Loss........................................................................10
                   Extraordinary Loss................................................................................10
                   Extraordinary Trust Fund Expenses.................................................................10
                   Fannie Mae........................................................................................11
                   FDIC     .........................................................................................11
                   Final Recovery Determination......................................................................11
                   Fraud Loss........................................................................................11
                   Fraud Loss Amount.................................................................................11
                   Freddie Mac.......................................................................................11
                   Gross Margin......................................................................................11
                   Independent.......................................................................................12
                   Independent Contractor............................................................................12
                   Index    .........................................................................................12
                   Initial Rate Cap..................................................................................12
                   Insurance Proceeds................................................................................12


                                                          ii

<PAGE>


          SECTION                                                                                                  PAGE
          -------                                                                                                  ----

                   Interest Accrual Period...........................................................................12
                   Interest Distribution Amount......................................................................13
                   Late Collections..................................................................................13
                   Liquidation Event.................................................................................13
                   Liquidation Proceeds..............................................................................13
                   Loan-to-Value Ratio...............................................................................13
                   Master Servicer...................................................................................13
                   Master Servicer Event of Default..................................................................14
                   Master Servicer Remittance Date...................................................................14
                   Maximum Mortgage Rate.............................................................................14
                   Minimum Mortgage Rate.............................................................................14
                   Monthly Payment...................................................................................14
                   Moody's  .........................................................................................14
                   Mortgage .........................................................................................14
                   Mortgage File.....................................................................................14
                   Mortgage Loan.....................................................................................14
                   Mortgage Loan Purchase Agreement..................................................................14
                   Mortgage Loan Remittance Rate.....................................................................14
                   Mortgage Loan Schedule............................................................................14
                   Mortgage Note.....................................................................................16
                   Mortgage Pool.....................................................................................16
                   Mortgage Rate.....................................................................................16
                   Mortgaged Property................................................................................17
                   Mortgagor.........................................................................................17
                   Net Mortgage Rate.................................................................................17
                   New Lease.........................................................................................17
                   Nonrecoverable P&I Advance........................................................................17
                   Non-United States Person..........................................................................17
                   Officers' Certificate.............................................................................17
                   Opinion of Counsel................................................................................17
                   Original Mortgage Loan............................................................................17
                   Originator........................................................................................17
                   Overcollateralization.............................................................................17
                   Ownership Interest................................................................................18
                   Pass-Through Rate.................................................................................18
                   Periodic Rate Cap.................................................................................18
                   Percentage Interest...............................................................................18
                   Permitted Investments.............................................................................18
                   Permitted Transferee..............................................................................19
                   Person   .........................................................................................19
                   P&I Advance.......................................................................................19
                   Plan     .........................................................................................19
                   Prepayment Assumption.............................................................................19
                   Prepayment Interest Shortfall.....................................................................20


                                                          iii

<PAGE>


          SECTION                                                                                                  PAGE
          -------                                                                                                  ----

                   Prepayment Period.................................................................................20
                   Primary Mortgage Insurance Policy.................................................................20
                   Prime Rate........................................................................................20
                   Principal Prepayment..............................................................................20
                   Purchase Price....................................................................................20
                   Qualified Insurer.................................................................................21
                   Qualified Substitute Mortgage Loan................................................................21
                   Rate/Term Refinancing.............................................................................21
                   Rating Agencies...................................................................................22
                   Realized Loss.....................................................................................22
                   Record Date.......................................................................................23
                   Refinanced Mortgage Loan..........................................................................23
                   Regular Certificate...............................................................................23
                   Regular Interest..................................................................................23
                   Relief Act........................................................................................23
                   Relief Act Interest Shortfall.....................................................................23
                   REMIC    .........................................................................................23
                   REMIC I  .........................................................................................23
                   REMIC I Certificate...............................................................................23
                   REMIC Provisions..................................................................................23
                   Remittance Report.................................................................................24
                   Rents from Real Property..........................................................................24
                   REO Account.......................................................................................24
                   REO Disposition...................................................................................24
                   REO Imputed Interest..............................................................................24
                   REO Property......................................................................................24
                   Request for Release...............................................................................24
                   Residential Dwelling..............................................................................24
                   Residual Certificate..............................................................................24
                   Residual Interest.................................................................................24
                   Responsible Officer...............................................................................24
                   Scheduled Principal Balance.......................................................................25
                   Seller   .........................................................................................25
                   Senior Certificate................................................................................25
                   Senior Percentage.................................................................................25
                   Senior Prepayment Percentage......................................................................25
                   Senior Principal Distribution Amount..............................................................26
                   Servicing Account.................................................................................28
                   Servicing Advances................................................................................28
                   Servicing Fee.....................................................................................28
                   Servicing Fee Rate................................................................................28
                   Servicing Officer.................................................................................28
                   Single Certificate................................................................................28
                   Special Hazard Amount.............................................................................28


                                                          iv

<PAGE>


          SECTION                                                                                                  PAGE
          -------                                                                                                  ----

                   Special Hazard Loss...............................................................................29
                   S&P      .........................................................................................29
                   Startup Day.......................................................................................29
                   Stated Principal Balance..........................................................................29
                   Stayed Funds......................................................................................30
                   Subordinate Certificate...........................................................................30
                   Subordinate Percentage............................................................................30
                   Subordinate Prepayment Percentage.................................................................30
                   Subordinate Principal Distribution Amount.........................................................30
                   Sub-Servicer......................................................................................31
                   Sub-Servicing Account.............................................................................31
                   Sub-Servicing Agreement...........................................................................32
                   Tax Returns.......................................................................................32
                   Termination Price.................................................................................32
                   Trailing Recoveries...............................................................................32
                   Transfer .........................................................................................32
                   Transferee........................................................................................32
                   Transferor........................................................................................32
                   Trigger Amount....................................................................................32
                   Trust Administrator...............................................................................32
                   Trust Fund........................................................................................32
                   Trustee  .........................................................................................32
                   Uninsured Cause...................................................................................32
                   United States Person..............................................................................32
                   Value    .........................................................................................33
                   Voting Rights.....................................................................................33
                   Weighted Average Net Mortgage Rate................................................................33
          1.02.    Allocation of Certain Interest Shortfalls.........................................................33

                                                      ARTICLE II

                                             CONVEYANCE OF MORTGAGE LOANS;
                                           ORIGINAL ISSUANCE OF CERTIFICATES

          2.01.    Conveyance of Mortgage Loans......................................................................35
          2.02.    Acceptance of REMIC I by the Trustee..............................................................39
          2.03.    Repurchase or Substitution of Mortgage Loans by the Seller or the Depositor.......................40
          2.04.    Reserved..........................................................................................42
          2.05.    Representations, Warranties and Covenants of the Master Servicer..................................42
          2.06.    Issuance of the Certificates......................................................................44


                                                           v

<PAGE>


          SECTION                                                                                                  PAGE
          -------                                                                                                  ----

                                                      ARTICLE III

                                             ADMINISTRATION AND SERVICING
                                                 OF THE MORTGAGE LOANS

          3.01.    Master Servicer to Act as Master Servicer.........................................................45
          3.02.    Sub-Servicing Agreements Between the Master Servicer and Sub-Servicers............................46
          3.03.    Successor Sub-Servicers...........................................................................47
          3.04.    Liability of the Master Servicer..................................................................48
          3.05.    No Contractual Relationship Between Sub-Servicers and Trustee
                   or Certificateholders.............................................................................48
          3.06.    Assumption or Termination of Sub-Servicing Agreements by Trustee..................................48
          3.07.    Collection of Certain Mortgage Loan Payments......................................................49
          3.08.    Sub-Servicing Accounts............................................................................49
          3.09.    Collection of Taxes, Assessments and Similar Items; Servicing Accounts............................50
          3.10.    Collection Account and Distribution Account.......................................................50
          3.11.    Withdrawals from the Collection Account and Distribution Account..................................53
          3.12.    Investment of Funds in the Collection Account and the Distribution Account........................55
          3.13.    Maintenance of the Primary Mortgage Insurance Policies;
                   Collections Thereunder............................................................................56
          3.14.    Maintenance of Hazard Insurance and Errors and Omissions and Fidelity
                   Coverage..........................................................................................57
          3.15.    Enforcement of Due-On-Sale Clauses; Assumption Agreements.........................................59
          3.16.    Realization Upon Defaulted Mortgage Loans.........................................................60
          3.17.    Trustee to Cooperate; Release of Mortgage Files...................................................61
          3.18.    Servicing Compensation............................................................................62
          3.19.    Reports to the Trustee; Collection Account Statements.............................................63
          3.20.    Statement as to Compliance........................................................................63
          3.21.    Independent Public Accountants' Servicing Report..................................................64
          3.22.    Access to Certain Documentation...................................................................64
          3.23.    Title, Management and Disposition of REO Property.................................................65
          3.24.    Obligations of the Master Servicer in Respect of Prepayment Interest
                   Shortfalls........................................................................................68
          3.25.    Obligations of the Master Servicer in Respect of Monthly Payments.................................68

                                                      ARTICLE IV

                                            PAYMENTS TO CERTIFICATEHOLDERS

          4.01.    Distributions.....................................................................................69
          4.02.    Statements to Certificateholders..................................................................72
          4.03.    Remittance Reports; P&I Advances..................................................................75
          4.04.    Allocation of Extraordinary Trust Fund Expenses and Realized Losses...............................77
          4.05.    Compliance with Withholding Requirements..........................................................78


                                                          vi

<PAGE>


          SECTION                                                                                                  PAGE
          -------                                                                                                  ----

          4.06.    Reserved..........................................................................................78
          4.07.    Commission Reporting..............................................................................78

                                                       ARTICLE V

                                                   THE CERTIFICATES

          5.01.    The Certificates..................................................................................80
          5.02.    Registration of Transfer and Exchange of Certificates.............................................82
          5.03.    Mutilated, Destroyed, Lost or Stolen Certificates.................................................86
          5.04.    Persons Deemed Owners.............................................................................86
          5.05.    Certain Available Information.....................................................................87

                                                      ARTICLE VI

                                         THE DEPOSITOR AND THE MASTER SERVICER

          6.01.    Liability of the Depositor and the Master Servicer................................................88
          6.02.    Merger or Consolidation of the Depositor or the Master Servicer...................................88
          6.03.    Limitation on Liability of the Depositor, the Master Servicer and Others..........................88
          6.04.    Limitation on Resignation of the Master Servicer..................................................89
          6.05.    Rights of the Depositor in Respect of the Master Servicer.........................................90

                                                      ARTICLE VII

                                                        DEFAULT

          7.01.    Master Servicer Events of Default.................................................................91
          7.02.    Trustee to Act; Appointment of Successor..........................................................93
          7.03.    Notification to Certificateholders................................................................94
          7.04.    Waiver of Master Servicer Events of Default.......................................................95

                                                     ARTICLE VIII

                                  CONCERNING THE TRUSTEE AND THE TRUST ADMINISTRATOR

          8.01.    Duties of Trustee and Trust Administrator.........................................................96
          8.02.    Certain Matters Affecting the Trustee and the Trust Administrator.................................97
          8.03.    Neither Trustee nor Trust Administrator Liable for Certificates or
                   Mortgage Loans....................................................................................98
          8.04.    Trustee and Trust Administrator May Own Certificates..............................................99
          8.05.    Trustee's and Trust Administrator's Fees and Expenses.............................................99
          8.06.    Eligibility Requirements for Trustee and Trust Administrator.....................................100
          8.07.    Resignation and Removal of the Trustee and the Trust Administrator...............................100


                                                          vii

<PAGE>



          8.08.    Successor Trustee or Trust Administrator.........................................................101
          8.09.    Merger or Consolidation of Trustee or Trust Administrator........................................102
          8.10.    Appointment of Co-Trustee or Separate Trustee....................................................102
          8.11.    [intentionally omitted]..........................................................................103
          8.12.    Appointment of Office or Agency..................................................................103
          8.13.    Representations and Warranties...................................................................103

                                                      ARTICLE IX

                                                      TERMINATION

          9.01     Termination Upon Repurchase or Liquidation of the REMIC I
                   Regular Interests................................................................................105
          9.02     Additional Termination Requirements..............................................................107

                                                       ARTICLE X

                                                   REMIC PROVISIONS

          10.01.   REMIC Administration.............................................................................108
          10.02.   Prohibited Transactions and Activities...........................................................110
          10.03.   Master Servicer, Trustee and Trust Administrator Indemnification.................................111

                                                      ARTICLE XI

                                               MISCELLANEOUS PROVISIONS

          11.01.   Amendment........................................................................................112
          11.02.   Recordation of Agreement; Counterparts...........................................................113
          11.03.   Limitation on Rights of Certificateholders.......................................................113
          11.04.   Governing Law....................................................................................114
          11.05.   Notices..........................................................................................114
          11.06.   Severability of Provisions.......................................................................115
          11.07.   Notice to Rating Agencies........................................................................115
          11.08.   Article and Section References...................................................................116
          11.09.   Grant of Security Interest.......................................................................116
</TABLE>




                                      viii

<PAGE>



<TABLE>
<CAPTION>
          Exhibits
          --------
<S>                         <C>
          Exhibit A-1       Form of Class A Certificate
          Exhibit A-2       Form of Class B-1 Certificate
          Exhibit A-3       Form of Class B-2 Certificate
          Exhibit A-4       Form of Class B-3 Certificate
          Exhibit A-5       Form of Class B-4 Certificate
          Exhibit A-6       Form of Class B-5 Certificate
          Exhibit A-7       Form of Class B-6 Certificate
          Exhibit A-8       Form of Class R-I Certificate
          Exhibit B         [Reserved]
          Exhibit C         [Reserved]
          Exhibit D         Form of Mortgage Loan Purchase Agreement
          Exhibit E-1       Request for Release
          Exhibit E-2       Request for Release Mortgage Loans paid in full
          Exhibit F-1       Form of Transferor Representation Letter and Form of Transferee
                            Representation Letter in Connection with Transfer of Class B-4 Certificates,
                            Class B-5 Certificates, Class B-6 Certificates and Residual Certificates
                            Pursuant to Rule 144A Under the 1933 Act
          Exhibit F-2       Form of Transfer Affidavit and Agreement and Form of Transferor Affidavit
                            in Connection with Transfer of Residual Certificates
          Exhibit G         Form of Certification with respect to ERISA and the Code
          Schedule 1        Mortgage Loan Schedule
          Schedule 2        Mortgage Loan Schedule with respect to Mortgage Loans with
                            Loan-to-Value Ratios in excess of 80% that have Primary Mortgage Insurance
</TABLE>



                                       ix

<PAGE>



                   This Pooling and Servicing Agreement, is dated and effective
as of May 1, 2001, among SALOMON BROTHERS MORTGAGE SECURITIES VII, INC., as
Depositor, CITIMORTGAGE, INC., as Master Servicer and Trust Administrator and
THE BANK OF NEW YORK, as Trustee.

                             PRELIMINARY STATEMENT:

                   The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
REMIC I created hereunder.

                   As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement as a REMIC (as defined herein) for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC I". The Class R-I Certificates will be the sole class of
"residual interests" in REMIC I for purposes of the REMIC Provisions (as defined
herein). The following table irrevocably sets forth the designation, the
Pass-Through Rate, the initial Certificate Principal Balance and, solely for
purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the
"latest possible maturity date" for each of the Classes of Certificates.


<TABLE>
<CAPTION>
                                                                     Initial Aggregate
                                                                   Certificate Principal             Latest Possible
Designation                            Pass-Through Rate                   Balance                    Maturity Date(1)
-----------                            -----------------                   -------                    ----------------
<S>                                    <C>                         <C>                               <C>
Class A                                  Variable(2)                   $472,835,000.00               December 25, 2030
Class B-1                                Variable(2)                   $  4,874,000.00               December 25, 2030
Class B-2                                Variable(2)                   $  2,437,000.00               December 25, 2030
Class B-3                                Variable(2)                   $  2,438,000.00               December 25, 2030
Class B-4                                Variable(2)                   $  1,706,000.00               December 25, 2030
Class B-5                                Variable(2)                   $  1,462,000.00               December 25, 2030
Class B-6                                Variable(2)                   $  1,706,812.08               December 25, 2030
</TABLE>
_____________________________

(1)       Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
          regulations, the Distribution Date immediately following the maturity
          date for the Mortgage Loan with the latest maturity date has been
          designated as the "latest possible maturity date" for each Class of
          Certificates.
(2)       Calculated in accordance with the definition of "Pass-Through Rate"
          herein.




               As of the Cut-off Date, the Original Mortgage Loans had an
aggregate Scheduled Principal Balance equal to $487,458,812.08.




<PAGE>




               In consideration of the mutual agreements herein contained, the
Depositor, the Master Servicer, the Trust Administrator and the Trustee agree as
follows:


                                    ARTICLE I

                                   DEFINITIONS

               SECTION 1.01.          Defined Terms.

               Whenever used in this Agreement, including, without limitation,
in the Preliminary Statement hereto, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this Article.
Unless otherwise specified, all calculations described herein shall be made on
the basis of a 360-day year consisting of twelve 30-day months.

               "Adjustment Date": With respect to each Mortgage Loan, the first
day of the month in which the Mortgage Rate of a Mortgage Loan changes pursuant
to the related Mortgage Note. The first Adjustment Date following the Cut-off
Date as to each Mortgage Loan is set forth in the Mortgage Loan Schedule.

               "Affiliate": With respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect to
any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

               "Agreement": This Pooling and Servicing Agreement and all
amendments hereof and supplements hereto.

               "Allocated Realized Loss Amount": With respect to any
Distribution Date and any Class of Certificates, the sum of (i) any Realized
Losses allocated to such Class of Certificates on any Distribution Date and (ii)
the amount of any Allocated Realized Loss Amount for such Class of Certificates
remaining unpaid from the prior Distribution Date.

               "Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage.

               "Available Distribution Amount": With respect to any Distribution
Date, an amount equal to (1) the sum of (a) the aggregate of the amounts on
deposit in the Collection Account and Distribution Account as of the close of
business on the related Determination Date, (b) the aggregate of any amounts
received in respect of an REO Property withdrawn from any REO Account and
deposited in the Distribution Account for such Distribution Date pursuant to
Section 3.23, (c) the aggregate of any amounts deposited in the Distribution
Account by the Master Servicer in respect


                                        2

<PAGE>



of Prepayment Interest Shortfalls for such Distribution Date pursuant to Section
3.24, (d) the aggregate of any P&I Advances made by the Master Servicer for such
Distribution Date pursuant to Section 4.03, (e) the aggregate amount of any
Trailing Recoveries received or collected during the related Prepayment Period
and (f) the aggregate of any advances made by the Trustee for such Distribution
Date pursuant to Section 7.02, reduced (to not less than zero) by (2) the sum of
(x) the portion of the amount described in clause (1)(a) above that represents
(i) Monthly Payments on the Mortgage Loans received from a Mortgagor on or prior
to the Determination Date but due during any Due Period subsequent to the
related Due Period, (ii) Principal Prepayments on the Mortgage Loans received
after the related Prepayment Period (together with any interest payments
received with such Principal Prepayments to the extent they represent the
payment of interest accrued on the Mortgage Loans during a period subsequent to
the related Prepayment Period), (iii) Liquidation Proceeds, Insurance Proceeds
and Trailing Recoveries received in respect of the Mortgage Loans after the
related Prepayment Period, (iv) amounts reimbursable or payable to the
Depositor, the Master Servicer, the Trustee, the Trust Administrator, the Seller
or any Sub-Servicer pursuant to Section 3.11(a) or Section 3.12 or otherwise
payable in respect of Extraordinary Trust Fund Expenses, (v) Stayed Funds and
(vi) amounts deposited in the Collection Account or the Distribution Account in
error, and (y) amounts reimbursable to the Trustee for an advance made pursuant
to Section 7.02(b), which advance the Trustee has determined to be
nonrecoverable from the Stayed Funds in respect of which it was made.

               "Bankruptcy Amount": As of any date of determination, an amount
equal to the excess, if any, of (A) $100,000 over (B) the aggregate amount of
Bankruptcy Losses allocated solely to the Subordinate Certificates in accordance
with Section 4.04.

               "Bankruptcy Code": The Bankruptcy Reform Act of 1978 (Title 11 of
the United States Code), as amended.

               "Bankruptcy Loss": With respect to any Mortgage Loan, a Realized
Loss resulting from a Deficient Valuation or Debt Service Reduction.

               "Book-Entry Certificate": Any Certificate registered in the name
of the Depository or its nominee. Initially, the Book-Entry Certificates will be
the Class A Certificates, the Class B-1 Certificates, the Class B-2 Certificates
and the Class B-3 Certificates.

               "Book-Entry Custodian": The custodian appointed pursuant to
Section 5.01.

               "Business Day": Any day other than a Saturday, a Sunday or a day
on which banking or savings and loan institutions in the State of California,
the State of Florida or the State of New York, or in the city in which the
Corporate Trust Office of the Trustee is located, are authorized or obligated by
law or executive order to be closed.

               "Cash-out Refinancing": A Refinanced Mortgage Loan the proceeds
of which were in excess of the principal balance of any existing first mortgage
on the related Mortgaged Property and related closing costs, and were used to
pay any such existing first mortgage, related closing costs and subordinate
mortgages on the related Mortgaged Property.



                                        3

<PAGE>



               "Certificate": Any one of the Salomon Mortgage Loan Trust, Series
2001-CPB1, Mortgage Pass-Through Certificates, issued under this Agreement.

               "Certificate Factor": With respect to any Class of Certificates
as of any Distribution Date, a fraction, expressed as a decimal carried to six
places, the numerator of which is the aggregate Certificate Principal Balance of
such Class of Certificates on such Distribution Date (after giving effect to any
distributions of principal and allocations of Realized Losses and Extraordinary
Trust Fund Expenses in reduction of the Certificate Principal Balance of such
Class of Certificates to be made on such Distribution Date), and the denominator
of which is the initial aggregate Certificate Principal Balance of such Class of
Certificates as of the Closing Date.

               "Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that a
Disqualified Organization or a Non-United States Person shall not be a Holder of
a Residual Certificate for any purposes hereof and, solely for the purposes of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor or the Master Servicer or any Affiliate thereof shall be
deemed not to be outstanding and the Voting Rights to which it is entitled shall
not be taken into account in determining whether the requisite percentage of
Voting Rights necessary to effect any such consent has been obtained, except as
otherwise provided in Section 11.01. The Trustee and the Trust Administrator may
conclusively rely upon a certificate of the Depositor or the Master Servicer in
determining whether a Certificate is held by an Affiliate thereof. All
references herein to "Holders" or "Certificateholders" shall reflect the rights
of Certificate Owners as they may indirectly exercise such rights through the
Depository and participating members thereof, except as otherwise specified
herein; provided, however, that the Trustee and the Trust Administrator shall be
required to recognize as a "Holder" or "Certificateholder" only the Person in
whose name a Certificate is registered in the Certificate Register.

               "Certificate Owner": With respect to a Book-Entry Certificate,
the Person who is the beneficial owner of such Certificate as reflected on the
books of the Depository or on the books of a Depository Participant or on the
books of an indirect participating brokerage firm for which a Depository
Participant acts as agent.

               "Certificate Principal Balance": With respect to any Certificate
as of any date of determination, the Certificate Principal Balance of such
Certificate on the Distribution Date immediately prior to such date of
determination, reduced by the aggregate of (a) all distributions of principal
made thereon on such immediately prior Distribution Date and (b) without
duplication of amounts described in clause (a) above, reductions in the
Certificate Principal Balance thereof in connection with allocations thereto of
Realized Losses on the Mortgage Loans and Extraordinary Trust Fund Expenses on
such immediately prior Distribution Date (or, in the case of any date of
determination up to and including the initial Distribution Date, the initial
Certificate Principal Balance of such Certificate, as stated on the face
thereof); provided, however, that the Certificate Principal Balance of each
Subordinate Certificate of the Class of Subordinate Certificates outstanding
with the highest numerical designation at any given time shall not be greater
than the Percentage Interest evidenced by such Certificate multiplied by the
excess, if any, of (A) the then aggregate Stated Principal Balance of the
Mortgage Loans over (B) the then aggregate Certificate Principal Balances of all
other Classes of Certificates then outstanding.


                                        4

<PAGE>



               "Certificate Register": The register maintained pursuant to
Section 5.02.

               "Class": Collectively, all of the Certificates bearing the same
class designation.

               "Class A Certificate": Any one of the Class A Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-1 and evidencing a Regular Interest in REMIC I for
purposes of the REMIC Provisions.

               "Class B Percentage": Any one of the Class B-1 Percentage, the
Class B-2 Percentage, the Class B-3 Percentage, the Class B-4 Percentage, the
Class B-5 Percentage or the Class B-6 Percentage.

               "Class B-1 Certificate": Any one of the Class B-1 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-2 and evidencing a Regular Interest in REMIC I for
purposes of the REMIC Provisions.

               "Class B-1 Percentage": With respect to any Distribution Date, a
fraction, expressed as a percentage, the numerator of which is the excess, if
any, of the aggregate Certificate Principal Balance of the Class B-1
Certificates immediately prior to such date over the aggregate amount, if any,
payable to the Holders of the Class B-1 Certificates on such date pursuant to
Section 4.01(b)(i)(Z), and the denominator of which is the sum of (i) the
aggregate of the Scheduled Principal Balance of each of the Mortgage Loans, plus
(ii) the aggregate of the Scheduled Principal Balance of each of the REO
Properties, in each case before reduction for any Realized Losses on such
Distribution Date.

               "Class B-2 Certificate": Any one of the Class B-2 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-3 and evidencing a Regular Interest in REMIC I for
purposes of the REMIC Provisions.

               "Class B-2 Percentage": With respect to any Distribution Date, a
fraction, expressed as a percentage, the numerator of which is the excess, if
any, of the aggregate Certificate Principal Balance of the Class B-2
Certificates immediately prior to such date over the aggregate amount, if any,
payable to the Holders of the Class B-2 Certificates on such date pursuant to
Section 4.01(b)(i)(Z), and the denominator of which is the sum of (i) the
aggregate of the Scheduled Principal Balance of each of the Mortgage Loans, plus
(ii) the aggregate of the Scheduled Principal Balance of each of the REO
Properties, in each case before reduction for any Realized Losses on such
Distribution Date.

               "Class B-3 Certificate": Any one of the Class B-3 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-4 and evidencing a Regular Interest in REMIC I for
purposes of the REMIC Provisions.

               "Class B-3 Percentage": With respect to any Distribution Date, a
fraction, expressed as a percentage, the numerator of which is the excess, if
any, of the aggregate Certificate Principal Balance of the Class B-3
Certificates immediately prior to such date over the aggregate amount, if any,
payable to the Holders of the Class B-3 Certificates on such date pursuant to
Section


                                        5

<PAGE>



4.01(b)(i)(Z), and the denominator of which is the sum of (i) the aggregate of
the Scheduled Principal Balance of each of the Mortgage Loans, plus (ii) the
aggregate of the Scheduled Principal Balance of each of the REO Properties, in
each case before reduction for any Realized Losses on such Distribution Date.

               "Class B-4 Certificate": Any one of the Class B-4 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-5 and evidencing a Regular Interest in REMIC I for
purposes of the REMIC Provisions.

               "Class B-4 Percentage": With respect to any Distribution Date, a
fraction, expressed as a percentage, the numerator of which is the excess, if
any, of the aggregate Certificate Principal Balance of the Class B-4
Certificates immediately prior to such date over the aggregate amount, if any,
payable to the Holders of the Class B-4 Certificates on such date pursuant to
Section 4.01(b)(i)(Z), and the denominator of which is the sum of (i) the
aggregate of the Scheduled Principal Balance of each of the Mortgage Loans, plus
(ii) the aggregate of the Scheduled Principal Balance of each of the REO
Properties, in each case before reduction for any Realized Losses on such
Distribution Date.

               "Class B-5 Certificate": Any one of the Class B-5 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-6 and evidencing a Regular Interest in REMIC I for
purposes of the REMIC Provisions.

               "Class B-5 Percentage": With respect to any Distribution Date, a
fraction, expressed as a percentage, the numerator of which is the excess, if
any, of the aggregate Certificate Principal Balance of the Class B-5
Certificates immediately prior to such date over the aggregate amount, if any,
payable to the Holders of the Class B-5 Certificates on such date pursuant to
Section 4.01(b)(i)(Z), and the denominator of which is the sum of (i) the
aggregate of the Scheduled Principal Balance of each of the Mortgage Loans, plus
(ii) the aggregate of the Scheduled Principal Balance of each of the REO
Properties, in each case before reduction for any Realized Losses on such
Distribution Date.

               "Class B-6 Certificate": Any one of the Class B-6 Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-7 and evidencing a Regular Interest in REMIC I for
purposes of the REMIC Provisions.

               "Class B-6 Percentage": With respect to any Distribution Date, a
fraction, expressed as a percentage, the numerator of which is the excess, if
any, of the aggregate Certificate Principal Balance of the Class B-6
Certificates immediately prior to such date over the aggregate amount, if any,
payable to the Holders of the Class B-6 Certificates on such date pursuant to
Section 4.01(b)(i)(Z), and the denominator of which is the sum of (i) the
aggregate of the Scheduled Principal Balance of each of the Mortgage Loans, plus
(ii) the aggregate of the Scheduled Principal Balance of each of the REO
Properties, in each case before reduction for any Realized Losses on such
Distribution Date.



                                        6

<PAGE>



               "Class R-I Certificate": Any one of the Class R-I Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-8 and evidencing the Residual Interest in REMIC I
for purposes of the REMIC Provisions.

               "Closing Date": May 30, 2001.

               "Code":  The Internal Revenue Code of 1986.

               "Collection Account": The account or accounts created and
maintained by the Master Servicer pursuant to Section 3.10(a), which shall be
entitled, "CitiMortgage, Inc., as Master Servicer for The Bank of New York, as
Trustee, in trust for the registered holders of Salomon Brothers Mortgage
Securities VII, Inc., Mortgage Pass-Through Certificates, Series 2001-CPB1." The
Collection Account must be an Eligible Account.

               "Commission": The Securities and Exchange Commission.

               "Cooperative": A private, cooperative housing corporation which
owns or leases land and all or part of a building or buildings, including
apartments, spaces used for commercial purposes and common areas therein and
whose board of directors authorizes, among other things, the sale of cooperative
stock.

               "Cooperative Loans": Any of the Mortgage Loans made in respect of
a cooperative apartment, evidenced by a Mortgage Note and secured by (i) a
security agreement, (ii) the related cooperative stock certificate, (iii) an
assignment of the cooperative lease, (iv) financing statements and (v) a stock
power (or other similar instrument), and ancillary thereto, a recognition
agreement between the Cooperative and the originator of the Cooperative Loan,
each of which was transferred and assigned to the Trustee pursuant to Section
2.01 and are from time to time held as part of the Trust Fund.

               "Corporate Trust Office": The principal corporate trust office of
the Trustee at which at any particular time its corporate trust business in
connection with this Agreement shall be administered, which office at the date
of the execution of this instrument is located at 101 Barclay Street, 12E, New
York, New York 10286, or at such other address as the Trustee may designate from
time to time by notice to the Certificateholders, the Depositor, the Trust
Administrator and the Master Servicer.

               "Cut-off Date": With respect to each Original Mortgage Loan, May
1, 2001. With respect to all Qualified Substitute Mortgage Loans, their
respective dates of substitution. References herein to the "Cut-off Date," when
used with respect to more than one Mortgage Loan, shall be to the respective
Cut-off Dates for such Mortgage Loans.

               "Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.



                                        7

<PAGE>



               "Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding principal balance of the Mortgage
Loan, which valuation results from a proceeding initiated under the Bankruptcy
Code.

               "Definitive Certificates":  As defined in Section 5.01(b).

               "Deleted Mortgage Loan": A Mortgage Loan replaced or to be
replaced by a Qualified Substitute Mortgage Loan.

               "Depositor": Salomon Brothers Mortgage Securities VII, Inc., a
Delaware corporation, or its successor in interest.

               "Depository": The Depository Trust Company, or any successor
Depository hereafter named. The nominee of the initial Depository, for purposes
of registering those Certificates that are to be Book-Entry Certificates, is
CEDE & Co. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform Commercial Code of the State of New
York and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934, as amended.

               "Depository Institution": Any depository institution or trust
company, including the Trustee, that (a) is incorporated under the laws of the
United States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations that
are rated A-1 by S&P and P-1 by Moody's (or a comparable rating if S&P and
Moody's are not the Rating Agencies).

               "Depository Participant": A broker, dealer, bank or other
financial institution or other Person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.

               "Determination Date": With respect to each Distribution Date, the
18th day of the calendar month in which such Distribution Date occurs or, if
such 18th day is not a Business Day, the Business Day immediately preceding such
18th day.

               "Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the tenants thereof, the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers, the performance of any construction work thereon or any use
of such REO Property in a trade or business conducted by REMIC I, other than
through an Independent Contractor; provided, however, that the Trustee (or the
Master Servicer on behalf of the Trustee) shall not be considered to Directly
Operate an REO Property solely because the Trustee (or the Master Servicer on
behalf of the Trustee) establishes rental terms, chooses tenants, enters into or
renews leases, deals with taxes and insurance, or makes decisions as to repairs
or capital expenditures with respect to such REO Property.



                                        8

<PAGE>



               "Disqualified Organization": Any of the following: (i) the United
States, any State or political subdivision thereof, any possession of the United
States, or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for Freddie Mac, a majority of its board of directors is not
selected by such governmental unit), (ii) any foreign government, any
international organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain farmers' cooperatives
described in Section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code (including the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an "electing
large partnership" within the meaning of Section 775 of the Code and (vi) any
other Person so designated by the Trustee based upon an Opinion of Counsel that
the holding of an Ownership Interest in a Residual Certificate by such Person
may cause REMIC I or any Person having an Ownership Interest in any Class of
Certificates (other than such Person) to incur a liability for any federal tax
imposed under the Code that would not otherwise be imposed but for the Transfer
of an Ownership Interest in a Residual Certificate to such Person. The terms
"United States," "State" and "international organization" shall have the
meanings set forth in Section 7701 of the Code or successor provisions.

               "Distribution Account": The trust account or accounts created and
maintained by the Trustee pursuant to Section 3.10(b) which shall be entitled
"The Bank of New York, as Trustee, in trust for the registered holders of
Salomon Brothers Mortgage Securities VII, Inc., Mortgage Pass- Through
Certificates, Series 2001-CPB1." The Distribution Account must be an Eligible
Account.

               "Distribution Date": The 25th day of any month, or if such 25th
day is not a Business Day, the Business Day immediately following such 25th day,
commencing in June 2001.

               "DOL": The United States Department of Labor or any successor in
interest.

               "DOL Regulations": The regulations promulgated by the DOL at 29
C.F.R.ss.2510.3- 101.

               "Due Date": With respect to each Distribution Date, the first day
of the calendar month in which such Distribution Date occurs, which is the day
of the month on which the Monthly Payment is due on a Mortgage Loan, exclusive
of any days of grace.

               "Due Period": With respect to any Distribution Date, the period
commencing on the second day of the calendar month preceding the calendar month
in which such Distribution Date occurs and ending on the related Due Date.

               "Eligible Account": Any of (i) an account or accounts maintained
with a Depository Institution, (ii) an account or accounts the deposits in which
are fully insured by the FDIC or (iii) a trust account or accounts maintained
with the corporate trust department of a federal or state chartered depository
institution or trust company acting in its fiduciary capacity. Eligible Accounts
may bear interest.

               "ERISA": The Employee Retirement Income Security Act of 1974, as
amended.


                                        9

<PAGE>



               "Estate in Real Property": A fee simple estate in a parcel of
land.

               "Excess Bankruptcy Loss": Any Bankruptcy Loss, or portion
thereof, which exceeds the then applicable Bankruptcy Amount.

               "Excess Fraud Loss": Any Fraud Loss, or portion thereof, which
exceeds the then applicable Fraud Loss Amount.

               "Excess Loss": Any Excess Bankruptcy Loss, Excess Special Hazard
Loss, Excess Fraud Loss or Extraordinary Loss.

               "Excess Special Hazard Loss": Any Special Hazard Loss, or portion
thereof, that exceeds the then applicable Special Hazard Amount.

               "Extraordinary Loss": Any Realized Loss or portion thereof caused
by or resulting from:

             (i)       nuclear or chemical reaction or nuclear radiation or
                       radioactive or chemical contamination, all whether
                       controlled or uncontrolled and whether such loss be
                       direct or indirect, proximate or remote or be in whole or
                       in part caused by, contributed to or aggravated by a
                       peril covered by the definition of the term "Special
                       Hazard Loss";

            (ii)       hostile or warlike action in time of peace or war,
                       including action in hindering, combating or defending
                       against an actual, impending or expected attack by any
                       government or sovereign power, DE JURE or DE FACTO, or by
                       any authority maintaining or using military, naval or air
                       forces, or by military, naval or air forces, or by an
                       agent of any such government, power, authority or forces;

           (iii)       any weapon of war employing atomic fission or radioactive
                       forces whether in time of peace or war, and

            (iv)       insurrection, rebellion, revolution, civil war, usurped
                       power or action taken by governmental authority in
                       hindering, combating or defending against such an
                       occurrence, seizure or destruction under quarantine or
                       customs regulations, confiscation by order of any
                       government or public authority, or risks of contraband or
                       illegal transactions or trade.

               "Extraordinary Trust Fund Expenses": Any amounts reimbursable to
the Master Servicer or the Depositor pursuant to Section 6.03, any amounts
payable from the Distribution Account in respect of taxes pursuant to Section
10.01(g)(iii), any amounts reimbursable to the Trustee or the Trust
Administrator from the Trust Fund pursuant to Section 2.01, Section 8.05 and any
other costs, expenses, liabilities and losses borne by the Trust Fund (exclusive
of any cost, expense, liability or loss that is specific to a particular
Mortgage Loan or REO Property and is taken into account in calculating a
Realized Loss in respect thereof) for which the Trust Fund has not and,


                                       10

<PAGE>



in the reasonable good faith judgment of the Trustee, shall not, obtain
reimbursement or indemnification from any other Person.

               "Fannie Mae": Fannie Mae, formerly known as the Federal National
Mortgage Association, or any successor thereto.

               "FDIC": Federal Deposit Insurance Corporation or any successor
thereto.

               "Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by the Seller, the Depositor or the Master Servicer pursuant to or as
contemplated by Section 2.03, Section 3.16(c) or Section 9.01), a determination
made by the Master Servicer that all Liquidation Proceeds have been recovered.
The Master Servicer shall maintain records of each Final Recovery Determination
made thereby.

               "Fraud Loss": Any Realized Loss or portion thereof sustained by
reason of a default arising from intentional fraud, dishonesty or
misrepresentation in connection with the related Mortgage Loan, including by
reason of the denial of coverage under any related Primary Mortgage Insurance
Policy.

               "Fraud Loss Amount": As of any date of determination after the
Cut-off Date, an amount equal to: (X) prior to the first anniversary of the
Cut-off Date, 2.00% (initially, $9,749,176.24) of the aggregate outstanding
principal balance of the Mortgage Loans as of the Cut-off Date minus the
aggregate amount of Fraud Losses on the Mortgage Loans allocated solely to the
Subordinate Certificates in accordance with Section 4.04 since the Cut-off Date
up to such date of determination, (Y) from the first to the third anniversary of
the Cut-off Date, (1) the lesser of (a) the Fraud Loss Amount as of the most
recent anniversary of the Cut-off Date and (b) 1.00% of the aggregate
outstanding principal balance of the Mortgage Loans as of the most recent
anniversary of the Cut-off Date minus (2) the Fraud Losses on the Mortgage Loans
allocated solely to the Subordinate Certificates in accordance with Section 4.04
since the most recent anniversary of the Cut-off Date up to such date of
determination and (Z) from the third anniversary to the fifth anniversary of the
Cut-off Date, (1) the lesser of (a) the Fraud Loss Amount as of the most recent
anniversary of the Cut-off Date and (b) 0.50% of the aggregate outstanding
principal balance of the Mortgage Loans as of the most recent anniversary of the
Cut-off Date minus (2) the Fraud Losses on the Mortgage Loans allocated solely
to the Subordinate Certificates in accordance with Section 4.04 since the most
recent anniversary of the Cut-off Date up to such date of determination. On and
after the fifth anniversary of the Cut-off Date, the Fraud Loss Amount shall be
zero. In addition, after the Certificate Principal Balances of the Subordinate
Certificates are reduced to zero, the Fraud Loss Amount will be zero.

               "Freddie Mac": Freddie Mac, formally known as the Federal Home
Loan Mortgage Corporation, or any successor thereto.

               "Gross Margin": With respect to each Mortgage Loan, the fixed
percentage set forth in the related Mortgage Note that is added to the Index on
each Adjustment Date in accordance with


                                       11

<PAGE>



the terms of the related Mortgage Note used to determine the Mortgage Rate for
such Mortgage Loan.

               "Independent": When used with respect to any specified Person,
any such Person who (a) is in fact independent of the Depositor, the Master
Servicer and their respective Affiliates, (b) does not have any direct financial
interest in or any material indirect financial interest in the Depositor, the
Master Servicer or any Affiliate thereof, and (c) is not connected with the
Depositor, the Master Servicer or any Affiliate thereof as an officer, employee,
promoter, underwriter, trustee, partner, director or Person performing similar
functions; provided, however, that a Person shall not fail to be Independent of
the Depositor, the Master Servicer or any Affiliate thereof merely because such
Person is the beneficial owner of 1% or less of any class of securities issued
by the Depositor or the Master Servicer or any Affiliate thereof, as the case
may be.

               "Independent Contractor": Either (i) any Person (other than the
Master Servicer) that would be an "independent contractor" with respect to REMIC
I within the meaning of Section 856(d)(3) of the Code if REMIC I were a real
estate investment trust (except that the ownership tests set forth in that
section shall be considered to be met by any Person that owns, directly or
indirectly, 35% or more of any Class of Certificates), so long as REMIC I does
not receive or derive any income from such Person and provided that the
relationship between such Person and REMIC I is at arm's length, all within the
meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any other Person
(including the Master Servicer) if the Trustee has received an Opinion of
Counsel to the effect that the taking of any action in respect of any REO
Property by such Person, subject to any conditions therein specified, that is
otherwise herein contemplated to be taken by an Independent Contractor will not
cause such REO Property to cease to qualify as "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code (determined without regard to the
exception applicable for purposes of Section 860D(a) of the Code), or cause any
income realized in respect of such REO Property to fail to qualify as Rents from
Real Property.

               "Index": With respect to any Mortgage Loan, the index for the
adjustment of the Mortgage Rate set forth as such on the related Mortgage Note.

               "Initial Rate Cap": With respect to each Mortgage Loan, the
maximum increase or decrease in the Mortgage Rate on the first Adjustment Date
as provided in the related Mortgage Note.

               "Insurance Proceeds": Proceeds of any Primary Mortgage Insurance
Policy, title policy, hazard policy or other insurance policy covering a
Mortgage Loan, 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 Master Servicer would follow in
servicing mortgage loans held for its own account, subject to the terms and
conditions of the related Mortgage Note and Mortgage.

               "Interest Accrual Period": With respect to any Distribution Date
and any Class of Regular Certificates, the one-month period ending on the last
day of the calendar month preceding the month in which such Distribution Date
occurs.



                                       12

<PAGE>



               "Interest Distribution Amount": With respect to any Class of
Regular Certificates for any Distribution Date, an amount equal to one month's
interest accrued during the most recently ended Interest Accrual Period at the
applicable Pass-Through Rate on the Certificate Principal Balance thereof
immediately prior to such Distribution Date. The Interest Distribution Amount
for any Class of Regular Certificates (a) will also include, in the case of any
Distribution Date subsequent to the initial Distribution Date, the excess, if
any, of the Interest Distribution Amount in respect of such Certificates for the
immediately preceding Distribution Date, over the aggregate distributions of
interest made in respect of such Certificates pursuant to Section 4.01(a)(1) on
such immediately preceding Distribution Date and (b) will be reduced, in the
case of any Distribution Date, by the amount of any Prepayment Interest
Shortfalls (to the extent not covered by payments by the Master Servicer
pursuant to Section 3.24) and Relief Act Interest Shortfalls that were allocated
to such Certificates on such Distribution Date pursuant to Section 1.02. The
Interest Distribution Amount for any Class of Certificates will be based on a
360 day year consisting of twelve 30 day Interest Accrual Periods.

               "Late Collections": With respect to any Mortgage Loan, all
amounts received subsequent to the Determination Date immediately following any
Due Period, whether as late payments of Monthly Payments or as Insurance
Proceeds, Liquidation Proceeds or otherwise, which represent late payments or
collections of principal and/or interest due (without regard to any acceleration
of payments under the related Mortgage and Mortgage Note) but delinquent for
such Due Period and not previously recovered.

               "Liquidation Event": With respect to any Mortgage Loan, any of
the following events: (i) such Mortgage Loan is paid in full; (ii) a Final
Recovery Determination is made as to such Mortgage Loan; or (iii) such Mortgage
Loan is removed from REMIC I by reason of its being purchased, sold or replaced
pursuant to or as contemplated by Section 2.03, Section 3.16(c) or Section 9.01.
With respect to any REO Property, either of the following events: (i) a Final
Recovery Determination is made as to such REO Property; or (ii) such REO
Property is removed from REMIC I by reason of its being purchased pursuant to
Section 9.01.

               "Liquidation Proceeds": The amount (including any Insurance
Proceeds or amounts received in respect of the rental of any REO Property prior
to REO Disposition) received by the Master Servicer in connection with (i) the
taking of all or a part of a Mortgaged Property by exercise of the power of
eminent domain or condemnation, (ii) the liquidation of a defaulted Mortgage
Loan through a trustee's sale, foreclosure sale or otherwise, or (iii) the
repurchase, substitution or sale of a Mortgage Loan or an REO Property pursuant
to or as contemplated by Section 2.03, Section 3.16(c), Section 3.23 or Section
9.01.

               "Loan-to-Value Ratio": As of any date of determination, the
fraction, expressed as a percentage, the numerator of which is the principal
balance of the related Mortgage Loan at such date and the denominator of which
is the Value of the related Mortgaged Property.

               "Master Servicer": CitiMortgage, Inc. or any successor master
servicer appointed as herein provided, in its capacity as Master Servicer
hereunder.



                                       13

<PAGE>



               "Master Servicer Event of Default": One or more of the events
described in Section 7.01.

               "Master Servicer Remittance Date": With respect to any
Distribution Date, 12:00 p.m. New York time on the Business Day preceding the
Distribution Date or if the Collection Account is held at Citibank, N.A., 12:00
p.m. New York time on the Distribution Date.

               "Maximum Mortgage Rate": With respect to each Mortgage Loan, the
percentage set forth in the related Mortgage Note as the maximum Mortgage Rate
thereunder.

               "Minimum Mortgage Rate": With respect to each Mortgage Loan, the
percentage set forth in the related Mortgage Note as the minimum Mortgage Rate
thereunder.

               "Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by the related Mortgagor from time to time under the related Mortgage
Note, determined: (a) after giving effect to (i) any Deficient Valuation and/or
Debt Service Reduction with respect to such Mortgage Loan and (ii) any reduction
in the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to any extension granted or agreed to by
the Master Servicer pursuant to Section 3.07; and (c) on the assumption that all
other amounts, if any, due under such Mortgage Loan are paid when due.

               "Moody's": Moody's Investors Service, Inc., or its successor in
interest.

               "Mortgage": The mortgage, deed of trust or other instrument
creating a first lien on, or first priority security interest in, a Mortgaged
Property securing a Mortgage Note.

               "Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.

               "Mortgage Loan": Each mortgage loan or cooperative loan
transferred and assigned to the Trustee pursuant to Section 2.01 or Section
2.03(d) of this Agreement, as from time to time held as a part of REMIC I, the
Mortgage Loans so held being identified in the Mortgage Loan Schedule.

               "Mortgage Loan Purchase Agreement": The agreement between the
Depositor and the Seller regarding the transfer of the Mortgage Loans by the
Seller to or at the direction of the Depositor, substantially in the form of
Exhibit D annexed hereto.

               "Mortgage Loan Remittance Rate": With respect to any Mortgage
Loan or REO Property, as of any date of determination, the then applicable Net
Mortgage Rate in respect thereof.

               "Mortgage Loan Schedule": As of any date, the list of Mortgage
Loans included in REMIC I on such date, attached hereto as Schedule 1. The
Mortgage Loan Schedule shall set forth the following information with respect to
each Mortgage Loan:


                                       14

<PAGE>



             (i)       the Master Servicer's Mortgage Loan identifying number;

            (ii)       [reserved];

           (iii)       the street address of the Mortgaged Property including
                       the state and zip code;

            (iv)       a code indicating whether the Mortgaged Property is
                       owner-occupied;

             (v)       the type of Residential Dwelling constituting the
                       Mortgaged Property;

            (vi)       the original months to maturity;

           (vii)       the original date of the mortgage;

          (viii)       the Loan-to-Value Ratio at origination;

            (ix)       the Mortgage Rate in effect immediately following the
                       Cut-off Date;

             (x)       the date on which the first Monthly Payment was due on
                       the Mortgage Loan;

            (xi)       the stated maturity date;

           (xii)       the amount of the Monthly Payment at origination;

          (xiii)       the amount of the Monthly Payment as of the Cut-off Date;

           (xiv)       the last Due Date on which a Monthly Payment was actually
                       applied to the unpaid Stated Principal Balance;

            (xv)       the original principal amount of the Mortgage Loan;

           (xvi)       the Scheduled Principal Balance of the Mortgage Loan as
                       of the close of business on the Cut-off Date;

          (xvii)       a code indicating the purpose of the Mortgage Loan (I.E.,
                       purchase financing, Rate/Term Refinancing, Cash-Out
                       Refinancing);

         (xviii)       a code indicating the documentation style (i.e., full,
                       alternative or reduced);

           (xix)       a code indicating if the Mortgage Loan is subject to a
                       Primary Mortgage Insurance Policy;

            (xx)       the Value of the Mortgaged Property;

           (xxi)       the sale price of the Mortgaged Property, if applicable;



                                       15

<PAGE>



          (xxii)       the actual unpaid principal balance of the Mortgage Loan
                       as of the Cut-off Date;

         (xxiii)       the Gross Margin, the Maximum Mortgage Rate and the
                       Minimum Mortgage Rate;

          (xxiv)       the Periodic Rate Cap and the maximum first Adjustment
                       Date Mortgage Rate adjustment;

           (xxv)       the first Adjustment Date immediately following the
                       Cut-off Date; and

          (xxvi)       the Servicing Fee.

               The Mortgage Loan Schedule shall set forth the following
information with respect to the Mortgage Loans in the aggregate as of the
Cut-off Date: (1) the number of Mortgage Loans; (2) the current principal
balance of the Mortgage Loans; (3) the weighted average Mortgage Rate of the
Mortgage Loans; (4) the weighted average maturity of the Mortgage Loans; (5) the
Scheduled Principal Balance of the Mortgage Loans as of the close of business on
the Cut-off Date (not taking into account any Principal Prepayments received on
the Cut-off Date); and (6) the amount of the Monthly Payment as of the Cut-off
Date. The Mortgage Loan Schedule shall be amended from time to time by the
Depositor in accordance with the provisions of this Agreement. With respect to
any Qualified Substitute Mortgage Loan, Cut-off Date shall refer to the related
Cut-off Date for such Mortgage Loan, determined in accordance with the
definition of Cut-off Date herein.

               "Mortgage Note": The original executed note or other evidence of
the indebtedness of a Mortgagor under a Mortgage Loan.

               "Mortgage Pool": The pool of Mortgage Loans, identified on
Schedule 1 from time to time, and any REO Properties acquired in respect
thereof.

               "Mortgage Rate": With respect to each Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, without regard to
any reduction thereof as a result of a Debt Service Reduction or operation of
the Relief Act, which rate (A) as of any date of determination until the first
Adjustment Date following the Cut-off Date shall be the rate set forth in the
Mortgage Loan Schedule as the Mortgage Rate in effect immediately following the
Cut-off Date and (B) as of any date of determination thereafter shall be the
rate as adjusted on the most recent Adjustment Date equal to the sum, rounded to
the nearest 0.125% as provided in the Mortgage Note, of the Index, as most
recently available as of a date prior to the Adjustment Date as set forth in the
related Mortgage Note, plus the related Gross Margin; provided that the Mortgage
Rate on such Mortgage Loan on any Adjustment Date shall never be more than the
lesser of (i) the sum of the Mortgage Rate in effect immediately prior to the
Adjustment Date plus the related Periodic Rate Cap, if any, and (ii) the related
Maximum Mortgage Rate, and shall never be less than the greater of (i) the
Mortgage Rate in effect immediately prior to the Adjustment Date less the
Periodic Rate Cap, if any, and (ii) the related Minimum Mortgage Rate. With
respect to each Mortgage Loan that becomes an REO


                                       16

<PAGE>



Property, as of any date of determination, the annual rate determined in
accordance with the immediately preceding sentence as of the date such Mortgage
Loan became an REO Property.

               "Mortgaged Property": The underlying property securing a Mortgage
Loan, including any REO Property, consisting of an Estate in Real Property
improved by a Residential Dwelling.

               "Mortgagor":  The obligor on a Mortgage Note.

               "Net Mortgage Rate": With respect to any Mortgage Loan (or the
related REO Property) as of any date of determination, a per annum rate of
interest equal to the then applicable Mortgage Rate for such Mortgage Loan minus
the Servicing Fee Rate.

               "New Lease": Any lease of REO Property entered into on behalf of
REMIC I, including any lease renewed or extended on behalf of REMIC I, if REMIC
I has the right to renegotiate the terms of such lease.

               "Nonrecoverable P&I Advance": Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the
good faith business judgment of the Master Servicer, will not or, in the case of
a proposed P&I Advance, would not be ultimately recoverable from related late
payments, Insurance Proceeds or Liquidation Proceeds on such Mortgage Loan or
REO Property as provided herein.

               "Non-United States Person": Any Person other than a United States
Person.

               "Officers' Certificate": A certificate signed by the Chairman of
the Board, the Vice Chairman of the Board, the President or a vice president
(however denominated), and by the Treasurer, the Secretary, or one of the
assistant treasurers or assistant secretaries of the Seller or the Depositor, as
applicable; with respect to the Master Servicer, any officer who is authorized
to act for the Master Servicer in matters relating to this Agreement, and whose
action is binding upon the Master Servicer, initially including those
individuals whose names appear on the list of authorized officers delivered at
the closing.

               "Opinion of Counsel": A written opinion of counsel, who may,
without limitation, be salaried counsel for the Depositor, the Master Servicer
or the Trust Administrator acceptable to the Trustee, except that any opinion of
counsel relating to (a) the qualification of either REMIC I as a REMIC or (b)
compliance with the REMIC Provisions must be an opinion of Independent counsel.

               "Original Mortgage Loan": Any of the Mortgage Loans included in
REMIC I as of the Closing Date.

               "Originator":  Either Citibank, F.S.B. or Citibank, N.A.

               "Overcollateralization": With respect to any Distribution Date,
the excess, if any, of (a) the aggregate Stated Principal Balances of the
Mortgage Loans and REO Properties immediately following such Distribution Date
over (b) the sum of the aggregate Certificate Principal Balances of the
Certificates at the time of the allocation of any Realized Loss or Extraordinary
Trust Expense.


                                       17

<PAGE>



               "Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in such
Certificate as the Holder thereof and any other interest therein, whether direct
or indirect, legal or beneficial, as owner or as pledgee.

               "Pass-Through Rate": With respect to any Class of Certificates
for any Distribution Date, a rate per annum equal to the Weighted Average Net
Mortgage Rate.

               "Periodic Rate Cap": With respect to each Mortgage Loan and any
Adjustment Date therefor, the fixed percentage set forth in the related Mortgage
Note, which is the maximum amount by which the Mortgage Rate for such Mortgage
Loan may increase or decrease (without regard to the Maximum Mortgage Rate or
the Minimum Mortgage Rate) on such Adjustment Date from the Mortgage Rate in
effect immediately prior to such Adjustment Date.

               "Percentage Interest": With respect to any Class of Certificates,
the portion of the respective Class evidenced by such Certificate, expressed as
a percentage, the numerator of which is the initial Certificate Principal
Balance represented by such Certificate, and the denominator of which is the
initial aggregate Certificate Principal Balance of all of the Certificates of
such Class. The Book-Entry Certificates are issuable only in Percentage
Interests corresponding to initial Certificate Principal Balances of $100,000
and integral multiples of $1.00 in excess thereof. The Class B-4 Certificates,
the Class B-5 Certificates and the Class B-6 Certificates are issuable only in
Percentage Interests corresponding to the initial Certificate Principal Balances
of $100,000 and integral multiples of $1.00 in excess thereof; provided,
however, that a single Certificate of each such Class of Certificates may be
issued having a Percentage Interest corresponding to the remainder of the
aggregate initial Certificate Principal Balance of such Class or to an otherwise
authorized denomination for such Class plus such remainder. The Residual
Certificates are issuable only in Percentage Interests of 20% and multiples
thereof.

               "Permitted Investments": Any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
regardless of whether issued by the Depositor, the Master Servicer, the Trustee,
the Trust Administrator or any of their respective Affiliates:

                       (i) direct obligations of, or obligations fully
        guaranteed as to timely payment of 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) demand and time deposits in, certificates of deposit
        of, or bankers' acceptances (which shall each have an original maturity
        of not more than 90 days and, in the case of bankers' acceptances, shall
        in no event have an original maturity of more than 365 days or a
        remaining maturity of more than 30 days) denominated in United States
        dollars and issued by, any Depository Institution;

                       (iii) repurchase obligations with respect to any security
        described in clause (i) above entered into with a Depository Institution
        (acting as principal);

                       (iv) securities bearing interest or sold at a discount
        that are issued by any corporation incorporated under the laws of the
        United States of America or any state thereof


                                       18

<PAGE>



        and that are rated by the Rating Agencies in its highest long-term
        unsecured rating category at the time of such investment or contractual
        commitment providing for such investment;

                       (v) commercial paper (including both non-interest-bearing
        discount obligations and interest-bearing obligations payable on demand
        or on a specified date not more than 30 days after the date of
        acquisition thereof) that is rated by the Rating Agencies in its highest
        short-term unsecured debt rating available at the time of such
        investment;

                       (vi) units of money market funds, including money market
        funds advised by the Trustee or an Affiliate thereof, that have been
        rated "AAA" by S&P and "Aaa" by Moody's; and

                       (vii) if previously confirmed in writing to the Trustee,
        any other demand, money market or time deposit, or any other obligation,
        security or investment, as may be acceptable to the Rating Agencies as a
        permitted investment of funds backing securities having ratings
        equivalent to its highest initial rating of the Senior Certificates;

provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.

               "Permitted Transferee": Any Transferee of a Residual Certificate
other than a Disqualified Organization or Non-United States Person.

               "Person": Any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.

               "P&I Advance": As to any Mortgage Loan or REO Property, any
advance made by the Master Servicer in respect of any Distribution Date pursuant
to Section 4.03.

               "Plan": Any employee benefit plan or certain other retirement
plans and arrangements, including individual retirement accounts and annuities,
Keogh plans and bank collective investment funds and insurance company general
or separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA and Section 4975 of the Code.

               "Prepayment Assumption": A prepayment rate for the Mortgage Loans
of 22% CPR. The Prepayment Assumption is used solely for determining the accrual
of original issue discount on the Certificates for federal income tax purposes.
A CPR (or Constant Prepayment Rate) represents an annualized constant assumed
rate of prepayment each month of a pool of mortgage loans relative to its
outstanding principal balance for the life of such pool.



                                       19

<PAGE>



               "Prepayment Interest Shortfall": With respect to any Distribution
Date, for each Mortgage Loan that was during the related Prepayment Period the
subject of a Principal Prepayment in full or in part that was applied by the
Master Servicer to reduce the outstanding principal balance of such loan on a
date preceding the Due Date in the succeeding Prepayment Period, an amount equal
to interest at the applicable Mortgage Loan Remittance Rate on the amount of
such Principal Prepayment for the number of days commencing on the date on which
the prepayment is applied and ending on the last day of the related Prepayment
Period. The obligations of the Master Servicer in respect of any Prepayment
Interest Shortfall are set forth in Section 3.24.

               "Prepayment Period": With respect to any Distribution Date, the
calendar month preceding the calendar month in which such Distribution Date
occurs.

               "Primary Mortgage Insurance Policy": Each primary policy of
mortgage guaranty insurance in effect as represented in the Mortgage Loan
Purchase Agreement and as so indicated on the Mortgage Loan Schedule, or any
replacement policy therefor obtained by the Master Servicer or any Sub-Servicer
pursuant to Section 3.13. Any Mortgage Loan which has a Primary Mortgage
Insurance Policy is set forth on Schedule 2 attached hereto.

               "Prime Rate": The lesser of (i) the per annum rate of interest,
publicly announced from time to time by Chase Manhattan Bank at its principal
office in the City of New York, as its prime or base lending rate (any change in
such rate of interest to be effective on the date such change is announced by
Chase Manhattan Bank) and (ii) the maximum rate permissible under applicable
usury or similar laws limiting interest rates.

               "Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.

               "Purchase Price": With respect to any Mortgage Loan or REO
Property to be purchased pursuant to or as contemplated by Section 2.03, Section
3.16(c) or Section 9.01, and as confirmed by an Officers' Certificate from the
Master Servicer to the Trustee, an amount equal to the sum of: (i) 100% of the
Stated Principal Balance thereof as of the date of purchase (or such other price
as provided in Section 9.01), (ii) in the case of (x) a Mortgage Loan, accrued
interest on such Stated Principal Balance at the applicable Mortgage Loan
Remittance Rate in effect from time to time from the Due Date as to which
interest was last covered by a payment by the Mortgagor or an advance by the
Master Servicer, which payment or advance had as of the date of purchase been
distributed pursuant to Section 4.01, through the end of the calendar month in
which the purchase is to be effected, and (y) an REO Property, the sum of (1)
accrued interest on such Stated Principal Balance at the applicable Mortgage
Loan Remittance Rate in effect from time to time from the Due Date as to which
interest was last covered by a payment by the Mortgagor or an advance by the
Master Servicer through the end of the calendar month immediately preceding the
calendar month in which such REO Property was acquired, plus (2) REO Imputed
Interest for such REO Property for each calendar month commencing with the
calendar month in which such REO Property was acquired and ending with the
calendar month in which such purchase is to be effected, minus the total of all
net rental income, Insurance Proceeds, Liquidation Proceeds and P&I Advances
that as


                                       20

<PAGE>



of the date of purchase had been distributed as or to cover REO Imputed Interest
pursuant to Section 4.01; (iii) any unreimbursed Servicing Advances and P&I
Advances and any unpaid Servicing Fees allocable to such Mortgage Loan or REO
Property; (iv) any amounts previously withdrawn from the Collection Account in
respect of such Mortgage Loan or REO Property pursuant to Sections 3.11(a)(ix)
and Section 3.16(b); and (v) in the case of a Mortgage Loan required to be
purchased pursuant to Section 2.03, expenses reasonably incurred or to be
incurred by the Master Servicer or the Trustee in respect of the breach or
defect giving rise to the purchase obligation.

               "Qualified Insurer": Any insurer which meets the requirements of
Fannie Mae and Freddie Mac.

               "Qualified Substitute Mortgage Loan": A mortgage loan substituted
for a Deleted Mortgage Loan pursuant to the terms of this Agreement which must,
on the date of such substitution, (i) have an outstanding principal balance,
after application of all scheduled payments of principal and interest due during
or prior to the month of substitution, not in excess of the Scheduled Principal
Balance of the Deleted Mortgage Loan as of the Due Date in the calendar month
during which the substitution occurs, (ii) have a Mortgage Rate not less than
(and not more than one percentage point in excess of) the Mortgage Rate of the
Deleted Mortgage Loan, (iii) have a Maximum Mortgage Rate not less than the
Maximum Mortgage Rate on the Deleted Mortgage Loan, (iv) have a Minimum Mortgage
Rate not less than the Minimum Mortgage Rate of the Deleted Mortgage Loan, (v)
have a Gross Margin equal to the Gross Margin of the Deleted Mortgage Loan, (vi)
have a next Adjustment Date not more than two months later than the next
Adjustment Date on the Deleted Mortgage Loan, (vii) be covered under a Primary
Mortgage Insurance Policy if such Qualified Substitute Mortgage Loan has a
Loan-to-Value Ratio in excess of 80% and the Deleted Mortgage Loan was covered
by a Primary Mortgage Insurance Policy, (viii) have a remaining term to maturity
not greater than (and not more than one year less than) that of the Deleted
Mortgage Loan, (ix) have the same Due Date as the Due Date on the Deleted
Mortgage Loan, (x) have a Loan-to-Value Ratio as of the date of substitution
equal to or lower than the Loan-to-Value Ratio of the Deleted Mortgage Loan as
of such date, (xi) [intentionally omitted]; and (xii) conform to each
representation and warranty set forth in Section 6 of the Mortgage Loan Purchase
Agreement applicable to the Deleted Mortgage Loan. In the event that one or more
mortgage loans are substituted for one or more Deleted Mortgage Loans, the
amounts described in clause (i) hereof shall be determined on the basis of
aggregate principal balances, the Mortgage Rates described in clause (ii) hereof
shall be determined on the basis of weighted average Mortgage Rates, the terms
described in clause (viii) shall be determined on the basis of weighted average
remaining terms to maturity, the Loan-to-Value Ratios described in clause (x)
hereof shall be satisfied as to each such mortgage loan and, except to the
extent otherwise provided in this sentence, the representations and warranties
described in clause (xii) hereof must be satisfied as to each Qualified
Substitute Mortgage Loan or in the aggregate, as the case may be.

               "Rate/Term Refinancing": A Refinanced Mortgage Loan, the proceeds
of which are not in excess of the existing first mortgage loan on the related
Mortgaged Property and related closing costs, and were used exclusively to
satisfy the then existing first mortgage loan of the Mortgagor on the related
Mortgaged Property and to pay related closing costs.



                                       21

<PAGE>



               "Rating Agencies": S&P and Moody's or their successors. If such
agencies or their successors are no longer in existence, the "Rating Agencies"
shall be such nationally recognized statistical rating agencies, or other
comparable Persons, designated by the Depositor, written notice of which
designation shall be given to the Trustee, the Trust Administrator and the
Master Servicer.

               "Realized Loss": With respect to each Mortgage Loan as to which a
Final Recovery Determination has been made, an amount (not less than zero) equal
to (i) the unpaid principal balance of such Mortgage Loan as of the commencement
of the calendar month in which the Final Recovery Determination was made, plus
(ii) accrued interest from the Due Date as to which interest was last paid by
the Mortgagor through the end of the calendar month in which such Final Recovery
Determination was made, calculated in the case of each calendar month during
such period (A) at an annual rate equal to the annual rate at which interest was
then accruing on such Mortgage Loan and (B) on a principal amount equal to the
Stated Principal Balance of such Mortgage Loan as of the close of business on
the Distribution Date during such calendar month, plus (iii) any amounts
previously withdrawn from the Collection Account in respect of such Mortgage
Loan pursuant to Section 3.11(a)(ix) and Section 3.16(b), minus (iv) the
proceeds, if any, received in respect of such Mortgage Loan prior to the date
such Final Recovery Determination was made, net of amounts that are payable
therefrom to the Master Servicer with respect to such Mortgage Loan pursuant to
Section 3.11(a)(iii).

               With respect to any REO Property as to which a Final Recovery
Determination has been made an amount (not less than zero) equal to (i) the
unpaid principal balance of the related Mortgage Loan as of the date of
acquisition of such REO Property on behalf of REMIC I, plus (ii) accrued
interest from the Due Date as to which interest was last paid by the Mortgagor
in respect of the related Mortgage Loan through the calendar month in which such
Final Recovery Determination was made, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual rate at which
interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan as of
the close of business on the Distribution Date during such calendar month, plus
(iii) any amounts previously withdrawn from the Collection Account in respect of
the related Mortgage Loan pursuant to Section 3.11(a)(ix) and Section 3.16(b),
plus (iv) the aggregate of all Servicing Advances made by the Master Servicer in
respect of such REO Property or the related Mortgage Loan and any unpaid
Servicing Fees for which the Master Servicer has been or, in connection with
such Final Recovery Determination, will be reimbursed pursuant to Section
3.11(a)(iii) or Section 3.23 out of rental income, Insurance Proceeds and
Liquidation Proceeds received in respect of such REO Property, minus (v) the
total of all net rental income, Insurance Proceeds and Liquidation Proceeds
received in respect of such REO Property that has been, or in connection with
such Final Recovery Determination, will be transferred to the Distribution
Account pursuant to Section 3.23.

               With respect to each Mortgage Loan which has become the subject
of a Deficient Valuation, the difference between the principal balance of the
Mortgage Loan outstanding immediately prior to such Deficient Valuation and the
principal balance of the Mortgage Loan as reduced by the Deficient Valuation.

               With respect to each Mortgage Loan which has become the subject
of a Debt Service Reduction, the portion, if any, of the reduction in each
affected Monthly Payment attributable to a


                                       22

<PAGE>



reduction in the Mortgage Rate imposed by a court of competent jurisdiction.
Each such Realized Loss shall be deemed to have been incurred on the Due Date
for each affected Monthly Payment.

               "Record Date": With respect to each Distribution Date and any
Certificate, the last Business Day of the month immediately preceding the month
in which such Distribution Date occurs.

               "Refinanced Mortgage Loan": A Mortgage Loan the proceeds of which
were not used to purchase the related Mortgaged Property.

               "Regular Certificate": Any Senior Certificate or Subordinate
Certificate.

               "Regular Interest": A "regular interest" in a REMIC within the
meaning of Section 860G(a)(1) of the Code.

               "Relief Act": The Soldiers' and Sailors' Civil Relief Act of
1940, as amended.

               "Relief Act Interest Shortfall": With respect to any Distribution
Date and any Mortgage Loan, any reduction in the amount of interest collectible
on such Mortgage Loan for the most recently ended calendar month as a result of
the application of the Relief Act.

               "REMIC": A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.

               "REMIC I": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to which a REMIC election is to be made, consisting of: (i) such
Mortgage Loans as from time to time are subject to this Agreement, together with
the Mortgage Files relating thereto, and together with all collections thereon
and proceeds thereof; (ii) any REO Property, together with all collections
thereon and proceeds thereof; (iii) the Trustee's rights with respect to the
Mortgage Loans under all insurance policies required to be maintained pursuant
to this Agreement and any proceeds thereof; (iv) the Depositor's rights under
the Mortgage Loan Purchase Agreement (including any security interests created
thereby and excluding Section 17 thereof); and (v) the Collection Account, the
Distribution Account and any REO Account and such assets that are deposited
therein from time to time and any investments thereof, together with any and all
income, proceeds and payments with respect thereto. Notwithstanding the
foregoing, however, REMIC I specifically excludes all payments and other
collections of principal and interest due on the Mortgage Loans on or before the
Cut-off Date.

               "REMIC I Certificate": Any Regular Certificate or Class R-I
Certificate.

               "REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Section
860A through 860G of the Code, and related provisions, and proposed, temporary
and final regulations and published rulings, notices and announcements
promulgated thereunder, as the foregoing may be in effect from time to time.



                                       23

<PAGE>



               "Remittance Report": A report in form and substance acceptable to
the Trust Administrator and the Trustee prepared by the Master Servicer pursuant
to Section 4.03 with such additions, deletions and modifications as agreed to by
the Trustee, the Trust Administrator and the Master Servicer.

               "Rents from Real Property": With respect to any REO Property,
gross income of the character described in Section 856(d) of the Code as being
included in the term "rents from real property."

               "REO Account": The account or accounts maintained by the Master
Servicer in respect of an REO Property pursuant to Section 3.23.

               "REO Disposition": The sale or other disposition of an REO
Property on behalf of REMIC I.

               "REO Imputed Interest": As to any REO Property, for any calendar
month during which such REO Property was at any time part of REMIC I, one
month's interest at the applicable Mortgage Loan Remittance Rate on the Stated
Principal Balance of such REO Property (or, in the case of the first such
calendar month, of the related Mortgage Loan if appropriate) as of the close of
business on the Distribution Date in such calendar month.

               "REO Property": A Mortgaged Property acquired by the Master
Servicer on behalf of REMIC I through foreclosure or deed-in-lieu of
foreclosure, as described in Section 3.23.

               "Request for Release": A release signed by a Servicing Officer,
in the form of Exhibit E-1 or Exhibit E-2 attached hereto.

               "Residential Dwelling": Any one of the following: (i) an attached
or detached one- family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a one-family dwelling unit in a Fannie Mae eligible condominium project,
or (iv) a detached one-family dwelling in a planned unit development, none of
which is a co-operative, mobile or manufactured home (as defined in 42 United
States Code, Section 5402(6)).

               "Residual Certificate": Any one of the Class R-I Certificates.

               "Residual Interest": The sole class of "residual interests" in a
REMIC within the meaning of Section 860G(a)(2) of the Code.

               "Responsible Officer": When used with respect to the Trust
Administrator, the Chairman or Vice Chairman of the Board of Directors or
Trustees, the Chairman or Vice Chairman of the Executive or Standing Committee
of the Board of Directors or Trustees, the President, the Chairman of the
Committee on Trust Matters, and with respect to the Trustee and the Trust
Administrator any vice president, any assistant vice president, the Secretary,
any assistant secretary, the Treasurer, any assistant treasurer, any trust
officer or assistant trust officer or any other officer of the Trustee or the
Trust Administrator, as the case may be, customarily performing functions
similar to those performed by any of the above designated officers and, with
respect to a particular


                                       24

<PAGE>



matter, to whom such matter is referred because of such officer's knowledge of
and familiarity with the particular subject.

               "Scheduled Principal Balance": With respect to any Mortgage Loan:
(a) as of the Cut-off Date, the outstanding principal balance of such Mortgage
Loan as of such date, net of the principal portion of all unpaid Monthly
Payments, if any, due on or before such date; (b) as of any Due Date subsequent
to the Cut-off Date up to and including the Due Date in the calendar month in
which a Liquidation Event occurs with respect to such Mortgage Loan, the
Scheduled Principal Balance of such Mortgage Loan as of the Cut-off Date, minus
the sum of (i) the principal portion of each Monthly Payment due on or before
such Due Date but subsequent to the Cut-off Date, whether or not received, (ii)
all Principal Prepayments received before such Due Date but after the Cut-off
Date, (iii) the principal portion of all Liquidation Proceeds and Insurance
Proceeds received before such Due Date but after the Cut-off Date, net of any
portion thereof that represents principal due (without regard to any
acceleration of payments under the related Mortgage and Mortgage Note) on a Due
Date occurring on or before the date on which such proceeds were received and
(iv) any Realized Loss incurred with respect thereto as a result of a Deficient
Valuation occurring before such Due Date, but only to the extent such Realized
Loss represents a reduction in the portion of principal of such Mortgage Loan
not yet due (without regard to any acceleration of payments under the related
Mortgage and Mortgage Note) as of the date of such Deficient Valuation; and (c)
as of any Due Date subsequent to the occurrence of a Liquidation Event with
respect to such Mortgage Loan, zero. With respect to any REO Property: (a) as of
any Due Date subsequent to the date of its acquisition on behalf of REMIC I up
to and including the Due Date in the calendar month in which a Liquidation Event
occurs with respect to such REO Property, an amount (not less than zero) equal
to the Scheduled Principal Balance of the related Mortgage Loan as of the Due
Date in the calendar month in which such REO Property was acquired minus the
principal portion of each Monthly Payment that would have become due on such
related Mortgage Loan after such REO Property was acquired if such Mortgage Loan
had not been converted to an REO Property; and (b) as of any Due Date subsequent
to the occurrence of a Liquidation Event with respect to such REO Property,
zero.

               "Seller": CitiMortgage, Inc. or its successor in interest, in its
capacity as seller under the Mortgage Loan Purchase Agreement.

               "Senior Certificate":  Any Class A Certificate.

               "Senior Percentage": With respect to any Distribution Date, the
lesser of (a) 100% and (b) a fraction, expressed as a percentage, the numerator
of which is the excess, if any, of the aggregate Certificate Principal Balance
of the Class A Certificates for such Distribution Date over the aggregate
amount, if any, payable to the Holders of the Class A Certificates on such date
pursuant to clause (d) of the definition of "Senior Principal Distribution
Amount," and the denominator of which is the sum of (i) the aggregate of the
Scheduled Principal Balance of each of the Mortgage Loans, plus (ii) the
aggregate of the Scheduled Principal Balance of each of the REO Properties, in
each case before reduction for any Realized Losses on such Distribution Date.

               "Senior Prepayment Percentage": With respect to any Distribution
Date within the range indicated below, the percentage as indicated below:



                                       25

<PAGE>




<TABLE>
<CAPTION>
            Distribution Date                                        Senior Prepayment Percentage
-----------------------------------------------       ----------------------------------------------------------
<S>                                                   <C>
June 2001 through May 2006                            100%

June 2006 through May 2007                            Senior Percentage, plus 70% of the Subordinate
                                                      Percentage

June 2007 through May 2008                            Senior Percentage, plus 60% of the Subordinate
                                                      Percentage

June 2008 through May 2009                            Senior Percentage, plus 40% of the Subordinate
                                                      Percentage

June 2009 through May 2010                            Senior Percentage, plus 20% of the Subordinate
                                                      Percentage

June 2010 and thereafter                              Senior Percentage;
</TABLE>

provided, however, no reduction to the Senior Prepayment Percentage described
above shall be made as of any Distribution Date unless (i) the outstanding
principal balance of the Mortgage Loans delinquent 60 days or more (including
REO Properties and Mortgage Loans in foreclosure) averaged over the last six
months does not exceed 50% of the sum of the then current Certificate Principal
Balances of the Subordinate Certificates and (ii) Realized Losses on the
Mortgage Loans to date are less than the then applicable Trigger Amount.

               Notwithstanding the above, if on any Distribution Date (a) the
Subordinate Percentage, prior to giving effect to any distributions on such
Distribution Date, equals or exceeds two times the initial Subordinate
Percentage and (b) the provisions of clauses (i) and (ii) of the immediately
preceding paragraph are met, then the Senior Prepayment Percentage for such
Distribution Date will equal 100%, if such Distribution Date is prior to June
2004, and will equal the Senior Percentage for such Distribution Date, if such
Distribution Date occurs on or after June 2004.

               Notwithstanding the foregoing, upon a reduction of the
Certificate Principal Balances of the Senior Certificates to zero, the Senior
Prepayment Percentage will equal 0%. In addition, on any Distribution Date on
which the Senior Percentage exceeds the initial Senior Percentage, the Senior
Prepayment Percentage shall be 100%.

               "Senior Principal Distribution Amount": For any Distribution
Date, an amount equal to the sum of:

               (a) the product of (x) the then-applicable Senior Percentage and
         (y) the sum of the following:

                     (i) the aggregate of the principal portions of all Monthly
               Payments due during the related Due Period in respect of the
               Mortgage Loans whether or not received;



                                       26

<PAGE>



                    (ii) the principal portion of all Insurance Proceeds,
               Trailing Recoveries and Liquidation Proceeds (other than amounts
               described in clause (c) below) received in respect of the
               Mortgage Loans during the related Prepayment Period (other than
               any such Mortgage Loan that was purchased, sold or replaced
               pursuant to or as contemplated by Section 2.03, Section 3.16(c)
               or Section 9.01 during the related Prepayment Period), net of any
               portion thereof that represents a recovery of principal for which
               an advance was made by the Master Servicer pursuant to Section
               4.03 in respect of a preceding Distribution Date;

                   (iii) the Stated Principal Balance (calculated immediately
               prior to such Distribution Date) of each Mortgage Loan that was
               purchased, sold or replaced pursuant to or as contemplated by
               Section 2.03, Section 3.16(c) or Section 9.01 during the related
               Prepayment Period;

                     (iv) [reserved]; and

                     (v) in connection with the substitution of one or more
               Qualified Substitute Mortgage Loans for one or more Deleted
               Mortgage Loans pursuant to Section 2.03 during the related
               Prepayment Period, the excess, if any, of (A) the aggregate of
               the Stated Principal Balances (calculated as of the respective
               dates of substitution) of such Deleted Mortgage Loans, net of the
               aggregate of the principal portions of the Monthly Payments due
               during the related Prepayment Period (to the extent received from
               the related Mortgagor or advanced by the Master Servicer and
               distributed pursuant to Section 4.01 on the Distribution Date in
               the related Prepayment Period) in respect of each such Deleted
               Mortgage Loan that was replaced prior to the Distribution Date in
               the related Prepayment Period, over (B) the aggregate of the
               Stated Principal Balances (calculated as of the respective dates
               of substitution) of such Qualified Substitute Mortgage Loans;

               (b) the product of (x) the then-applicable Senior Prepayment
         Percentage and (y) all Principal Prepayments received in respect of the
         Mortgage Loans during the related Prepayment Period;

               (c) with respect to any Mortgage Loan which was the subject of a
        Final Recovery Determination in the related Prepayment Period, the least
        of (a) the then-applicable Senior Prepayment Percentage multiplied by
        the net Liquidation Proceeds and Insurance Proceeds allocable to
        principal in respect of such Mortgage Loans and (b) the then-applicable
        Senior Percentage multiplied by the Scheduled Principal Balance of such
        Mortgage Loan at the time of such Final Recovery Determination; and

               (d) in the case of any Distribution Date subsequent to the
        initial Distribution Date, an amount equal to the excess, if any, of the
        Senior Principal Distribution Amount for the immediately preceding
        Distribution Date, over the aggregate distributions of principal made in
        respect of the Class A Certificates on such immediately preceding
        Distribution Date pursuant to Section 4.01 to the extent that any such
        amounts are not attributable to Realized Losses which were allocated to
        the Subordinate Certificates pursuant to Section 4.04.


                                       27

<PAGE>



               "Servicing Account": The account or accounts created and
maintained pursuant to Section 3.09.

               "Servicing Advances": The reasonable "out-of-pocket" costs and
expenses incurred by the Master Servicer in connection with a default,
delinquency or other unanticipated event by the Master Servicer in the
performance of its servicing obligations, including, but not limited to, the
cost of (i) the preservation, restoration and protection of a Mortgaged
Property, (ii) any enforcement or judicial proceedings, including foreclosures,
in respect of a particular Mortgage Loan, (iii) the management (including
reasonable fees in connection therewith) and liquidation of any REO Property,
and (iv) the performance of its obligations under Section 3.01, Section 3.09,
Section 3.13, Section 3.14, Section 3.16 and Section 3.23. The Master Servicer
shall not be required to make any Servicing Advance in respect of a Mortgage
Loan or REO Property that, in the good faith business judgment of the Master
Servicer, would not be ultimately recoverable from related Insurance Proceeds or
Liquidation Proceeds on such Mortgage Loan or REO Property as provided herein.

               "Servicing Fee": With respect to each Mortgage Loan and for any
calendar month, an amount equal to one month's interest (or in the event of any
payment of interest which accompanies a Principal Prepayment in full made by the
Mortgagor during such calendar month, interest for the number of days covered by
such payment of interest) at the applicable Servicing Fee Rate on the same
principal amount on which interest on such Mortgage Loan accrues for such
calendar month. A portion of such Servicing Fee may be retained by any
Sub-Servicer as its servicing compensation.

               "Servicing Fee Rate": 0.25% per annum.

               "Servicing Officer": Any employee of the Master Servicer involved
in, or responsible for, the administration and servicing of the Mortgage Loans,
whose name appear on a list of Servicing Officers furnished by the Master
Servicer to the Trustee, the Trust Administrator and the Depositor on the
Closing Date, as such list may from time to time be amended.

               "Single Certificate": With respect to any Class of Certificates
(other than the Residual Certificates), a hypothetical Certificate of such Class
evidencing a Percentage Interest for such Class corresponding to an initial
Certificate Principal Balance of $1,000. With respect to the Residual
Certificates, a hypothetical Certificate of such Class evidencing a 20%
Percentage Interest in such Class.

               "Special Hazard Amount": Initially, an amount equal to
$4,874,588.12. As of each anniversary of the Cut-off Date, the Special Hazard
Amount shall equal the lesser of (i) the related Special Hazard Amount on the
immediately preceding anniversary of the Cut-off Date less the sum of all
amounts allocated to the Subordinate Certificates in respect of Special Hazard
Losses on the Mortgage Loans during such year and (ii) the Adjustment Amount for
such anniversary. The "Adjustment Amount" with respect to each anniversary of
the Cut-off Date will be equal to the greatest of (i) 1.00% multiplied by the
aggregate outstanding principal balance of the Mortgage Loans, (ii) the
aggregate outstanding principal balance of the Mortgage Loans secured by
Mortgaged Properties located in the California postal zip code area in which the
highest percentage of related Mortgage Loans based on outstanding principal
balance are located and (iii) two times the


                                       28

<PAGE>



outstanding principal balance of the Mortgage Loan having the largest
outstanding principal balance, in each case as of such anniversary of the
Cut-off Date. After the Certificate Principal Balances of the Subordinate
Certificates are reduced to zero, the Special Hazard Amount will be zero.

               "Special Hazard Loss": Any Realized Loss or portion thereof not
in excess of the lesser of the cost of repair or replacement of a Mortgaged
Property suffered by such Mortgaged Property by reason of damage caused by
certain hazards (including earthquakes, mudflows, and, to a limited extent,
floods) not insured against under the hazard insurance policies or fire or flood
insurance policies required to be maintained in respect of such Mortgaged
Property pursuant to Section 3.14, or by reason of the application of any
co-insurance provision. Special Hazard Losses shall not include any
Extraordinary Loss or any of the following:

             (i)       wear and tear, deterioration, rust or corrosion, mold,
                       wet or dry rot; inherent vice or latent defect; animals,
                       birds, vermin, insects;

            (ii)       smog, smoke, vapor, liquid or dust discharge from
                       agricultural or industrial operations; pollution;
                       contamination;

           (iii)       settling, subsidence, cracking, shrinkage, bulging or
                       expansion of pavements, foundations, walls, floors, roofs
                       or ceilings; and

            (iv)       errors in design, faulty workmanship or faulty materials,
                       unless the collapse of the property or a part thereof
                       ensues and then only for the ensuing loss.

               "S&P": Standard & Poor's Ratings Services, a division of the
McGraw-Hill Companies, Inc., or its successor in interest.

               "Startup Day": With respect to REMIC I, the day designated as
such pursuant to Section 10.01(b) hereof.

               "Stated Principal Balance": With respect to any Mortgage Loan:
(a) as of any date of determination up to but not including the Distribution
Date on which the proceeds, if any, of a Liquidation Event with respect to such
Mortgage Loan would be distributed, the Scheduled Principal Balance of such
Mortgage Loan as of the Cut-off Date, as shown in the Mortgage Loan Schedule,
minus the sum of (i) the principal portion of each Monthly Payment due on a Due
Date subsequent to the Cut-off Date, to the extent received from the Mortgagor
or advanced by the Master Servicer and distributed pursuant to Section 4.01 on
or before such date of determination, (ii) all Principal Prepayments received
after the Cut-off Date, to the extent distributed pursuant to Section 4.01 on or
before such date of determination, (iii) all Liquidation Proceeds and Insurance
Proceeds applied by the Master Servicer as recoveries of principal in accordance
with the provisions of Section 3.16, to the extent distributed pursuant to
Section 4.01 on or before such date of determination, and (iv) any Realized Loss
incurred with respect thereto as a result of a Deficient Valuation made during
or prior to the Prepayment Period for the most recent Distribution Date
coinciding with or preceding such date of determination; and (b) as of any date
of determination coinciding with or subsequent to the Distribution Date on which
the proceeds, if any, of a Liquidation Event with respect to such Mortgage Loan
would be distributed, zero. With respect to any REO Property: (a) as of any date


                                       29

<PAGE>



of determination up to but not including the Distribution Date on which the
proceeds, if any, of a Liquidation Event with respect to such REO Property would
be distributed, an amount (not less than zero) equal to the Stated Principal
Balance of the related Mortgage Loan as of the date on which such REO Property
was acquired on behalf of REMIC I, minus, the principal portion of Monthly
Payments that would have become due on such related Mortgage Loan after such REO
Property was acquired if such Mortgage Loan had not been converted to an REO
Property, to the extent advanced by the Master Servicer and distributed pursuant
to Section 4.01 on or before such date of determination; and (b) as of any date
of determination coinciding with or subsequent to the Distribution Date on which
the proceeds, if any, of a Liquidation Event with respect to such REO Property
would be distributed, zero.

               "Stayed Funds": If the Master Servicer is the subject of a
proceeding under the federal Bankruptcy Code and the making of a Remittance (as
defined in Section 7.02(b)) is prohibited by Section 362 of the federal
Bankruptcy Code, funds which are in the custody of the Master Servicer, a
trustee in bankruptcy or a federal bankruptcy court and should have been the
subject of such Remittance absent such prohibition.

               "Subordinate Certificate": Any Class B-1 Certificate, Class B-2
Certificate, Class B-3 Certificate, Class B-4 Certificate, Class B-5 Certificate
or Class B-6 Certificate.

               "Subordinate Percentage": With respect to any Distribution Date,
a percentage equal to 100% minus the Senior Percentage for such Distribution
Date.

               "Subordinate Prepayment Percentage": With respect to any
Distribution Date, a percentage equal to 100% minus the Senior Prepayment
Percentage.

               "Subordinate Principal Distribution Amount": For any Distribution
Date, an amount equal to the sum of:

               (a) the product of (x) the then-applicable Subordinate Percentage
        and (y) the sum of the following:

                     (i) the aggregate of the principal portions of all Monthly
               Payments due during the related Due Period in respect of the
               Mortgage Loans whether or not received;

                    (ii) the principal portion of all Insurance Proceeds,
               Trailing Recoveries and Liquidation Proceeds (other than amounts
               described in clause (c) below) received in respect of the
               Mortgage Loans during the related Prepayment Period (other than
               any such Mortgage Loan that was purchased, sold or replaced
               pursuant to or as contemplated by Section 2.03, Section 3.16(c)
               or Section 9.01 during the related Prepayment Period), net of any
               portion thereof that represents a recovery of principal for which
               an advance was made by the Master Servicer pursuant to Section
               4.03 in respect of a preceding Distribution Date;



                                       30

<PAGE>



                   (iii) the Stated Principal Balance (calculated immediately
               prior to such Distribution Date) of each Mortgage Loan that was
               purchased, sold or replaced pursuant to or as contemplated by
               Section 2.03, Section 3.16(c) or Section 9.01 during the related
               Prepayment Period;

                     (iv) [reserved]; and

                     (v) in connection with the substitution of one or more
               Qualified Substitute Mortgage Loans for one or more Deleted
               Mortgage Loans pursuant to Section 2.03 during the related
               Prepayment Period, the excess, if any, of (A) the aggregate of
               the the Stated Principal Balances (calculated as of the
               respective dates of substitution) of such Deleted Mortgage Loans,
               net of the aggregate of the principal portions of the Monthly
               Payments due during the related Prepayment Period (to the extent
               received from the related Mortgagor or advanced by the Master
               Servicer and distributed pursuant to Section 4.01 on the
               Distribution Date in the related Prepayment Period) in respect of
               each such Deleted Mortgage Loan that was replaced prior to the
               Distribution Date in the related Prepayment Period, over (B) the
               aggregate of the Stated Principal Balances (calculated as of the
               respective dates of substitution) of such Qualified Substitute
               Mortgage Loans;

               (b) the product of (x) the then-applicable Subordinate Prepayment
         Percentage and (y) all Principal Prepayments received in respect of the
         Mortgage Loans during the related Prepayment Period;

               (c) with respect to any Mortgage Loans which were the subject of
        a Final Recovery Determination in the related Prepayment Period, the
        amount, if any, by which the net Liquidation Proceeds and Insurance
        Proceeds allocable to principal in respect of such Mortgage Loans exceed
        the amount distributable to the Class A Certificates pursuant to clause
        (c) of the definition of "Senior Principal Distribution Amount"; and

               (d) in the case of any Distribution Date subsequent to the
        initial Distribution Date, an amount equal to the excess, if any, of the
        Subordinate Principal Distribution Amount for the immediately preceding
        Distribution Date, over the aggregate distributions of principal made in
        respect of the Subordinate Certificates on such immediately preceding
        Distribution Date pursuant to Section 4.01 to the extent that any such
        amounts are not attributable to Realized Losses that were allocated to
        the Subordinate Certificates pursuant to Section 4.04.

               "Sub-Servicer": Any Person with which the Master Servicer has
entered into a Sub- Servicing Agreement and which meets the qualifications of a
Sub-Servicer pursuant to Section 3.02.

               "Sub-Servicing Account": An account established by a Sub-Servicer
which meets the requirements set forth in Section 3.08 and is otherwise
acceptable to the Master Servicer.



                                       31

<PAGE>



               "Sub-Servicing Agreement": The written contract between the
Master Servicer and a Sub-Servicer relating to servicing and administration of
certain Mortgage Loans as provided in Section 3.02.

               "Tax Returns": The federal income tax return on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any successor forms,
to be filed on behalf of REMIC I due to its classification as a REMIC under the
REMIC Provisions, together with any and all other information reports or returns
that may be required to be furnished to the Certificateholders or filed with the
Internal Revenue Service or any other governmental taxing authority under any
applicable provisions of federal, state or local tax laws.

               "Termination Price":  As defined in Section 9.01.

               "Trailing Recoveries": Any Insurance Proceeds, Liquidation
Proceeds and other payments or recoveries on a Mortgage Loan received or
collected by the Master Servicer after a Final Recovery Determination has been
made with respect to such Mortgage Loan or related REO Property.

               "Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment of any Ownership Interest in a
Certificate.

               "Transferee": Any Person who is acquiring by Transfer any
Ownership Interest in a Certificate.

               "Transferor": Any Person who is disposing by Transfer of any
Ownership Interest in a Certificate.

               "Trigger Amount": With respect to any Distribution Date, 30% of
the initial sum of the Certificate Principal Balances of the Subordinate
Certificates.

               "Trust Administrator": CitiMortgage, Inc., or its successor in
interest, or any successor trust administrator appointed as herein provided.

               "Trust Fund": Collectively, all of the assets of REMIC I.

               "Trustee": The Bank of New York, or its successor in interest, or
any successor trustee appointed as herein provided.

               "Uninsured Cause": Any cause of damage to a Mortgaged Property
such that the complete restoration of such property is not fully reimbursable by
the hazard insurance policies required to be maintained pursuant to Section
3.14.

               "United States Person": A citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States, any State


                                       32

<PAGE>



thereof or the District of Columbia (except, in the case of a partnership, to
the extent provided in regulations); provided that, for purposes solely of the
restrictions on the transfer of the Class R Certificates, no partnership or
other entity treated as a partnership for United States federal income tax
purposes shall be treated as a United States Person unless all persons that own
an interest in such partnership either directly or through any entity that is
not a corporation for United States federal income tax purposes are required by
the applicable operative agreement to be United States Persons, or an estate
whose income is subject to United States federal income tax regardless of its
source, or a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more United
States Persons have the authority to control all substantial decisions of the
trust. To the extent prescribed in regulations by the Secretary of the Treasury,
which have not yet been issued, a trust which was in existence on August 20,
1996 (other than a trust treated as owned by the grantor under subpart E of part
I of subchapter J of chapter 1 of the Code), and which was treated as a United
States person on August 20, 1996 may elect to continue to be treated as a United
States person notwithstanding the previous sentence. The term "United States"
shall have the meaning set forth in Section 7701 of the Code.

               "Value": With respect to any Mortgaged Property, the lesser of
(i) the value thereof as determined by an appraisal made for the originator of
the Mortgage Loan at the time of origination of the Mortgage Loan and (ii) the
purchase price paid for the related Mortgaged Property by the Mortgagor with the
proceeds of the Mortgage Loan, provided, however, in the case of a Refinanced
Mortgage Loan, such value of the Mortgaged Property is based solely upon the
value determined by an appraisal made for the originator of such Refinanced
Mortgage Loan at the time of origination of such Refinanced Mortgage Loan by an
appraiser.

               "Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. At all times during the term
of this Agreement, (i) 99% of all of the Voting Rights shall be allocated to the
Regular Certificates in proportion to their then outstanding Certificate
Principal Balances and (ii) 1% of all Voting Rights will be allocated among the
holders of the Residual Certificates, in proportion to their Percentage
Interests in each such Class. All Voting Rights allocated to any Class of
Certificates shall be allocated among such Certificates PRO RATA in accordance
with the respective Percentage Interests evidenced thereby.

               "Weighted Average Net Mortgage Rate": As of any date of
determination, the weighted average of the Net Mortgage Rates on the Mortgage
Loans, weighted on the basis of the Stated Principal Balance of the Mortgage
Loans.

               SECTION 1.02.          Allocation of Certain Interest Shortfalls.

               The aggregate amount of any Prepayment Interest Shortfalls (to
the extent not covered by payments by the Master Servicer pursuant to Section
3.24) and any Relief Act Interest Shortfall incurred in respect of the Mortgage
Loans for any Distribution Date shall be allocated among the Certificates, PRO
RATA in accordance with, and to the extent of one month's interest at the Pass-
Through Rate on the respective Certificate Principal Balance of such Certificate
immediately prior to such Distribution Date.




                                       33

<PAGE>






                                       34

<PAGE>




                                   ARTICLE II

                                   CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

               SECTION 2.01.          Conveyance of Mortgage Loans.

               The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee without recourse for the benefit of the Certificateholders all the
right, title and interest of the Depositor, including any security interest
therein for the benefit of the Depositor, in and to the Mortgage Loans
identified on the Mortgage Loan Schedule, the rights of the Depositor under the
Mortgage Loan Purchase Agreement (except Section 17 thereof), and all other
assets included or to be included in REMIC I. Such assignment includes all
interest and principal received by the Depositor or the Master Servicer on or
with respect to the Mortgage Loans (other than payments of principal and
interest due on such Mortgage Loans on or before the Cut-off Date). The
Depositor herewith delivers to the Trustee an executed copy of the Mortgage Loan
Purchase Agreement.

               In connection with such transfer and assignment, the Depositor
does hereby deliver to, and deposit with, the Trustee or a custodian on its
behalf, the following documents or instruments (a "Mortgage File") (I) with
respect to each Mortgage Loan so transferred and assigned (other than a Mortgage
Loan that is a Cooperative Loan):

                     (i) The Mortgage Note, endorsed by manual or facsimile
               signature without recourse by the Originator or an Affiliate of
               the Originator in blank or to the Trustee showing a complete
               chain of endorsements from the named payee to the Trustee or from
               the named payee to the Affiliate of the Originator and from such
               Affiliate to the Trustee;

                    (ii) The original recorded Mortgage, with evidence of
               recording thereon or a copy of the Mortgage certified by the
               public recording office in those jurisdictions where the public
               recording office retains the original;

                   (iii) An assignment from the Originator or an Affiliate of
               the Originator to the Trustee in recordable form of the Mortgage
               which may be included, where permitted by local law, in a blanket
               assignment or assignments of the Mortgage to the Trustee,
               including any intervening assignments and showing a complete
               chain of title from the original mortgagee named under the
               Mortgage to the Originator or an Affiliate of the Originator and
               to the Trustee;

                     (v) Any original assumption, modification, buydown or
               conversion-to- fixed-interest-rate agreement applicable to the
               Mortgage Loan;



                                       35

<PAGE>



                    (vi) With respect to any Mortgage Loan listed on Schedule 2
               attached hereto, the original Primary Mortgage Insurance Policy
               or certificate or a copy thereof;

                   (vii) The original or a copy of the title insurance policy
               (which may be a certificate or a short form policy relating to a
               master policy of title insurance) pertaining to the Mortgaged
               Property, or in the event such original title policy is
               unavailable, a copy of the preliminary title report and the
               lender's recording instructions, with the original to be
               delivered within 180 days of the Closing Date or an attorney's
               opinion of title in jurisdictions where such is the customary
               evidence of title;

and (II) with respect to each Mortgage Loan that is a Cooperative Loan so
transferred and assigned:

                     (i) The Mortgage Note, endorsed by manual or facsimile
               signature without recourse by the Originator or an Affiliate of
               the Originator in blank or to the Trustee showing a complete
               chain of endorsements and assignments from the named payee to the
               Trustee or from the named payee to the Affiliate of the
               Originator and from such Affiliate to the Trustee;

                       (ii) The original executed proprietary lease or occupancy
               agreement and all assignments thereof showing a complete chain of
               assignment from the named secured party to the Trustee;

                       (iii) The original stocks, shares, membership certificate
               or other contractual agreement evidencing ownership and the
               original stock power executed in blank;

                       (iv) The original executed recognition agreement and any
               executed assignments of recognition agreement showing a complete
               chain of assignment from the named secured party to the Trustee;

                       (v) The original executed security agreement or similar
               document and all assignments thereof showing a complete chain of
               assignment from the named secured party to the Trustee;

                       (vi) Except for Mortgage Loans (x) secured by Mortgaged
               Properties in the State of New Jersey or (y) originated prior to
               October 1988 and secured by Mortgaged Properties in the State of
               New York, the executed UCC-1 financing statement with evidence of
               recording thereon and executed original UCC-3 financing
               statements or other appropriate UCC financing statements required
               by state law, evidencing a complete and unbroken chain from the
               mortgagee to the Trustee with evidence of recording thereon (or
               in a form suitable for recordation); and

                       (viii) Any original assumption, modification, buydown or
               conversion-to- fixed-interest-rate agreement applicable to the
               Mortgage Loan.


                                       36

<PAGE>



               In instances where an original recorded Mortgage cannot be
delivered by the Depositor to the Trustee (or a custodian on behalf of the
Trustee) prior to or concurrently with the execution and delivery of this
Agreement, due to a delay in connection with the recording of such Mortgage, the
Depositor may, (a) in lieu of delivering such original recorded Mortgage
referred to in clause (I)(ii) above, deliver to the Trustee (or a custodian on
behalf of the Trustee) a copy thereof, provided that the Depositor certifies
that the original Mortgage has been delivered to a title insurance company for
recordation after receipt of its policy of title insurance or binder therefor
(which may be a certificate relating to a master policy of title insurance), and
(b) in lieu of delivering the completed assignment in recordable form referred
to in clause (I)(iii) or (II)(iv) above to the Trustee (or a custodian on behalf
of the Trustee), deliver such assignment to the Trustee (or a custodian on
behalf of the Trustee) completed except for recording information. In all such
instances, the Depositor will deliver the original recorded Mortgage and
completed assignment (if applicable) to the Trustee (or a custodian on behalf of
the Trustee) promptly upon receipt of such Mortgage. In instances where an
original recorded Mortgage has been lost or misplaced, the Depositor or the
related title insurance company may deliver, in lieu of such Mortgage, a copy of
such Mortgage bearing recordation information and certified as true and correct
by the office in which recordation thereof was made. In instances where the
original or a copy of the title insurance policy referred to in clause (I)(vii)
above (which may be a certificate relating to a master policy of title
insurance) pertaining to the Mortgaged Property relating to a Mortgage Loan
cannot be delivered by the Depositor to the Trustee (or a custodian on behalf of
the Trustee) prior to or concurrently with the execution and delivery of this
Agreement because such policy is not yet available, the Depositor may, in lieu
of delivering the original or a copy of such title insurance referred to in
clause (I)(vii) above, deliver to the Trustee (or a custodian on behalf of the
Trustee) a binder with respect to such policy (which may be a certificate
relating to a master policy of title insurance) and deliver the original or a
copy of such policy (which may be a certificate relating to a master policy of
title insurance) to the Trustee (or a custodian on behalf of the Trustee) within
180 days of the Closing Date, in instances where an original assumption,
modification, buydown or conversion-to-fixed- interest-rate agreement cannot be
delivered by the Depositor to the Trustee (or a custodian on behalf of the
Trustee) prior to or concurrently with the execution and delivery of this
Agreement, the Depositor may, in lieu of delivering the original of such
agreement referred to in clause (I)(v) or (II)(viii) above, deliver a certified
copy thereof.

               To the extent not already recorded, the Master Servicer, at the
expense of the Seller shall promptly (and in no event later than five Business
Days following the later of the Closing Date and the date of receipt by the
Master Servicer of the recording information for a Mortgage) submit or cause to
be submitted for recording, at no expense to REMIC I, in the appropriate public
office for real property records, each Assignment delivered to it pursuant
to(I)(iii) and (II)(iv) above and shall promptly submit or cause to be submitted
for filing, each Form UCC-3 assignment and the UCC-1 financing statement
delivered to it pursuant to (II)(vi) above. In the event that any such
Assignment, Form UCC-3 or Form UCC-1, as applicable, is lost or returned
unrecorded because of a defect therein, the Master Servicer, at the expense of
the Seller, shall promptly prepare or cause to be prepared a substitute
Assignment, Form UCC-3 or Form UCC-1, as applicable, or cure or cause to be
cured such defect, as the case may be, and thereafter cause each such Assignment
to be duly recorded. In connection with its servicing of Cooperative Loans, the
Master Servicer will use its best efforts to file timely continuation statements
with regard to each financing statement and assignment relating to Cooperative
Loans as to which the related Cooperative Apartment is located outside of


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<PAGE>



the State of New York. Notwithstanding the foregoing, the Master Servicer shall
not cause to be recorded any Assignment which relates to a Mortgage Loan in any
jurisdiction under the laws of which, as evidenced by an Opinion of Counsel
delivered or caused to be delivered by the Seller to the Trustee and the Rating
Agencies, the recordation of such assignment is not necessary to protect the
Trustee's interest in the related Mortgage Loan; provided, however,
notwithstanding the delivery of any Opinion of Counsel, the Master Servicer
shall submit each Assignment for recording, at no expense to the Trust Fund or
the Master Servicer, upon the earliest to occur of: (i) reasonable direction by
Holders of Certificates entitled to at least 25% of the Voting Rights, (ii) the
occurrence of a Master Servicer Event of Termination, (iii) the occurrence of a
bankruptcy, insolvency or foreclosure relating to the Seller, (iv) the
occurrence of a servicing transfer as described in Section 7.02 of this
Agreement and (v) with respect to any one Assignment the occurrence of a
foreclosure relating to the Mortgagor under the related Mortgage.
Notwithstanding the foregoing, if the Seller fails to pay the cost of recording
the Assignments, such expense will be paid by the Master Servicer and the Master
Servicer shall be reimbursed for such expenses by the Trust as set forth herein.

               With respect to a maximum of approximately 1.00% of the Original
Mortgage Loans, by outstanding principal balance of the Original Mortgage Loans
as of the Cut-off Date, if any original Mortgage Note referred to in (I)(i) or
(II)(i) above cannot be located, the obligations of the Depositor to deliver
such documents shall be deemed to be satisfied upon delivery to the Trustee (or
a custodian on behalf of the Trustee) of a photocopy of such Mortgage Note, if
available, with a lost note affidavit. If any of the original Mortgage Notes for
which a lost note affidavit was delivered to the Trustee (or a custodian on
behalf of the Trustee) is subsequently located, such original Mortgage Note
shall be delivered to the Trustee (or a custodian on behalf of the Trustee)
within three Business Days.

               The Depositor shall deliver or cause to be delivered to the
Trustee (or a custodian on behalf of the Trustee) promptly upon receipt thereof
any other original documents constituting a part of a Mortgage File received
with respect to any Mortgage Loan, including, but not limited to, any original
documents evidencing an assumption, modification, consolidation or extension of
any Mortgage Loan.

               All original documents relating to the Mortgage Loans that are
not delivered to the Trustee (or a custodian on behalf of the Trustee) are and
shall be held by or on behalf of the Seller, the Depositor or the Master
Servicer, as the case may be, in trust for the benefit of the Trustee on behalf
of the Certificateholders. In the event that any such original document is
required pursuant to the terms of this Section to be a part of a Mortgage File,
such document shall be delivered promptly to the Trustee (or a custodian on
behalf of the Trustee). Any such original document delivered to or held by the
Depositor that is not required pursuant to the terms of this Section to be a
part of a Mortgage File, shall be delivered promptly to the Master Servicer.

               Wherever it is provided in this Section 2.01 that any document,
evidence or information relating to a Mortgage Loan be delivered or supplied to
the Trustee, the Depositor shall do so by delivery thereof to the Trustee or a
custodian on behalf of the Trustee.

               SECTION 2.02.          Acceptance of REMIC I by the Trustee.



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<PAGE>



               Subject to the provisions of Section 2.01 and subject to any
exceptions noted on an exception report delivered by or on behalf of the
Trustee, the Trustee acknowledges receipt of the documents referred to in
Section 2.01 (other than such documents described in Sections 2.01(I)(v) and
(II)(viii)) above and all other assets included in the definition of "REMIC I"
under clauses (i), (iii), (iv) and (v) (to the extent of amounts deposited into
the Distribution Account) and declares that it holds and will hold such
documents and the other documents delivered to it constituting the Mortgage
File, and that it holds or will hold all such assets and such other assets
included in the definition of "REMIC I" in trust for the exclusive use and
benefit of all present and future Certificateholders.

               The Trustee, by execution and delivery hereof, acknowledges
receipt, subject to the review described in the succeeding sentence, of the
documents and other property referred to in Section 2.01 and declares that the
Trustee (or a custodian on behalf of the Trustee) holds and will hold such
documents and other property, including property yet to be received in the Trust
Fund, in trust, upon the trusts herein set forth, for the benefit of all present
and future Certificateholders. The custodian on its behalf and on behalf of the
Trustee shall, for the benefit of the Certificateholders, review each Mortgage
File within 90 days after execution and delivery of this Agreement, to ascertain
that all required documents have been executed, received and recorded, if
applicable, and that such documents relate to the Mortgage Loans. If in the
course of such review the Trustee or the custodian on its behalf finds a
document or documents constituting a part of a Mortgage File to be defective in
any material respect, the Trustee or the custodian on its behalf shall promptly
so notify the Depositor, the Trust Administrator, the Seller and the Master
Servicer. In addition, upon the discovery by the Depositor, the Master Servicer,
the Trust Administrator or the Trustee of a breach of any of the representations
and warranties made by the Seller in the Mortgage Loan Purchase Agreement in
respect of any Mortgage Loan which materially adversely affects such Mortgage
Loan or the interests of the related Certificateholders in such Mortgage Loan,
the party discovering such breach shall give prompt written notice to the other
parties.

               The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage Loans, the
related Mortgage Notes and the related documents, conveying good title thereto
free and clear of any liens and encumbrances, from the Depositor to the Trustee
in trust for the benefit of the Certificateholders and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee a first
priority perfected security interest in all of the Depositor's right, title and
interest in and to the Mortgage Loans, the related Mortgage Notes and the
related documents, and that this Agreement shall constitute a security agreement
under applicable law.

               The Trustee may, concurrently with the execution and delivery
hereof or at any time thereafter, enter into a custodial agreement with a
custodian pursuant to which the Trustee appoints a custodian to hold the
Mortgage Files on behalf of the Trustee for the benefit of all present and
future Certificateholders, which may provide that the custodian shall, on behalf
of the Trustee, and as the Trustee's agent, conduct the review of each Mortgage
File required under the first paragraph of this Section 2.02, provided that, if
the custodian so appointed is the Depositor or an Affiliate of the Depositor,
the Trustee shall conduct such review.


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<PAGE>



               SECTION 2.03.          Repurchase or Substitution of Mortgage
                                      Loans by the Seller or the Depositor.

               (a) Upon discovery or receipt of notice of any materially
defective document in, or that a document is missing from, a Mortgage File or of
the breach by the Seller of any representation, warranty or covenant under the
Mortgage Loan Purchase Agreement in respect of any Mortgage Loan which
materially adversely affects the value of such Mortgage Loan or the interest
therein of the Certificateholders, the Trustee shall promptly notify the Seller,
the Trust Administrator and the Master Servicer of such defect, missing document
or breach and request that the Seller deliver such missing document or cure such
defect or breach within 60 days from the date the Seller was notified of such
missing document, defect or breach, and if the Seller does not deliver such
missing document or cure such defect or breach in all material respects during
such period, the Master Servicer shall enforce the obligations of the Seller
under the Mortgage Loan Purchase Agreement to repurchase such Mortgage Loan from
REMIC I at the Purchase Price within 60 days after the date on which the Seller
was notified (subject to Section 2.03(e)) of such missing document, defect or
breach, if and to the extent that the Seller is obligated to do so under the
Mortgage Loan Purchase Agreement. The Purchase Price for the repurchased
Mortgage Loan shall be deposited in the Collection Account, and the Trustee,
upon receipt of written certification from the Master Servicer of such deposit,
shall release to the Seller the related Mortgage File and shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, as the Seller shall furnish to it and as shall be necessary to vest in
the Seller any Mortgage Loan released pursuant hereto, and the Trustee shall
have no further responsibility with regard to such Mortgage File. In lieu of
repurchasing any such Mortgage Loan as provided above, if so provided in the
Mortgage Loan Purchase Agreement, the Seller may cause such Mortgage Loan to be
removed from REMIC I (in which case it shall become a Deleted Mortgage Loan) and
substitute one or more Qualified Substitute Mortgage Loans in the manner and
subject to the limitations set forth in Section 2.03(d). It is understood and
agreed that the obligation of the Seller to cure or to repurchase (or to
substitute for) any Mortgage Loan as to which a document is missing, a material
defect in a constituent document exists or as to which such a breach has
occurred and is continuing shall constitute the sole remedy respecting such
omission, defect or breach available to the Trustee on behalf of the
Certificateholders.

               (b) Reserved.

               (c) Within 60 days of the earlier of discovery by the Master
Servicer or receipt of notice by the Master Servicer of the breach of any
representation, warranty or covenant of the Master Servicer set forth in Section
2.05 which materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the Master Servicer shall cure such
breach in all material respects.

               (d) Any substitution of Qualified Substitute Mortgage Loans for
Deleted Mortgage Loans made pursuant to Section 2.03(a) must be effected prior
to the date which is two years after the Startup Day for REMIC I.

               As to any Deleted Mortgage Loan for which the Seller substitutes
a Qualified Substitute Mortgage Loan or Loans, such substitution shall be
effected by the Seller delivering to


                                       40

<PAGE>



the Trustee, for such Qualified Substitute Mortgage Loan or Loans, the documents
and agreements, with all necessary endorsements thereon, as are required by
Section 2.01, together with an Officers' Certificate providing that each such
Qualified Substitute Mortgage Loan satisfies the definition thereof and
specifying the Substitution Shortfall Amount (as described below), if any, in
connection with such substitution. The custodian on its behalf and on behalf of
the Trustee shall, for the benefit of the Certificateholders, review each
Mortgage File within 90 days after execution and delivery of this Agreement, to
ascertain that all required documents have been executed, received and recorded,
if applicable, and that such documents relate to the Mortgage Loans. If in the
course of such review the Trustee or the custodian on its behalf finds a
document or documents constituting a part of a Mortgage File to be defective in
any material respect, the Trustee or the custodian on its behalf shall promptly
so notify the Depositor, the Trust Administrator, the Seller and the Master
Servicer. Monthly Payments due with respect to Qualified Substitute Mortgage
Loans in the month of substitution are not part of REMIC I and will be retained
by the Seller. For the month of substitution, distributions to
Certificateholders will reflect the Monthly Payment due on such Deleted Mortgage
Loan on or before the Due Date in the month of substitution, and the Seller
shall thereafter be entitled to retain all amounts subsequently received in
respect of such Deleted Mortgage Loan. The Depositor shall give or cause to be
given written notice to the Certificateholders that such substitution has taken
place, shall amend the Mortgage Loan Schedule to reflect the removal of such
Deleted Mortgage Loan from the terms of this Agreement and the substitution of
the Qualified Substitute Mortgage Loan or Loans and shall deliver a copy of such
amended Mortgage Loan Schedule to the Trustee. Upon such substitution, such
Qualified Substitute Mortgage Loan or Loans shall constitute part of the
Mortgage Pool and shall be subject in all respects to the terms of this
Agreement and the Mortgage Loan Purchase Agreement, including all applicable
representations and warranties thereof included in the Mortgage Loan Purchase
Agreement.

               For any month in which the Seller substitutes one or more
Qualified Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the
Master Servicer will determine the amount (the "Substitution Shortfall Amount"),
if any, by which the aggregate Purchase Price of all such Deleted Mortgage Loans
exceeds the aggregate of, as to each such Qualified Substitute Mortgage Loan,
the Scheduled Principal Balance thereof as of the date of substitution, together
with one month's interest on such Scheduled Principal Balance at the applicable
Mortgage Loan Remittance Rate. On the date of such substitution, the Seller will
deliver or cause to be delivered to the Master Servicer for deposit in the
Collection Account an amount equal to the Substitution Shortfall Amount, if any,
and the Trustee, upon receipt of the related Qualified Substitute Mortgage Loan
or Loans and certification by the Master Servicer of such deposit, shall release
to the Seller the related Mortgage File or Files and shall execute and deliver
such instruments of transfer or assignment, in each case without recourse, as
the Seller shall deliver to it and as shall be necessary to vest therein any
Deleted Mortgage Loan released pursuant hereto.

               In addition, the Seller shall obtain at its own expense and
deliver to the Trustee an Opinion of Counsel to the effect that such
substitution will not cause (a) any federal tax to be imposed on REMIC I,
including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(1) of the Code or on "contributions after
the startup date" under Section 860G(d)(1) of the Code, or (b) REMIC I to fail
to qualify as a REMIC at any time that any Certificate is outstanding.



                                       41

<PAGE>



               (e) Upon discovery by the Depositor, the Seller, the Master
Servicer, the Trust Administrator or the Trustee that any Mortgage Loan does not
constitute a "qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code, the party discovering such fact shall within two Business Days give
written notice thereof to the other parties. In connection therewith, the Seller
or the Depositor shall repurchase or, subject to the limitations set forth in
Section 2.03(d), substitute one or more Qualified Substitute Mortgage Loans for
the affected Mortgage Loan within 60 days of the earlier of discovery or receipt
of such notice with respect to such affected Mortgage Loan. Such repurchase or
substitution shall be made by (i) the Seller, if the affected Mortgage Loan's
status as a non-qualified mortgage is or results from a breach of any
representation, warranty or covenant made by the Seller under the Mortgage Loan
Purchase Agreement, or (ii) the Depositor, if the affected Mortgage Loan's
status as a non-qualified mortgage is a breach of no representation or warranty.
Any such repurchase or substitution shall be made in the same manner as set
forth in Sections 2.03(a). The Trustee shall reconvey to the Depositor or the
Seller, as the case may be, the Mortgage Loan to be released pursuant hereto in
the same manner, and on the same terms and conditions, as it would a Mortgage
Loan repurchased for breach of a representation or warranty.

               SECTION 2.04.          Reserved.

               SECTION 2.05.          Representations, Warranties and Covenants
                                      of the Master Servicer.

               The Master Servicer hereby represents, warrants and covenants to
the Trust Administrator and the Trustee, for the benefit of each of the Trustee,
the Trust Administrator, the Certificateholders and to the Depositor that as of
the Closing Date or as of such date specifically provided herein:

                     (i) The Master Servicer is a corporation duly organized,
               validly existing and in good standing under the laws of the State
               of Delaware and is duly authorized and qualified to transact any
               and all business contemplated by this Agreement to be conducted
               by the Master Servicer in any state in which a Mortgaged Property
               is located or is otherwise not required under applicable law to
               effect such qualification and, in any event, is in compliance
               with the doing business laws of any such State, to the extent
               necessary to ensure its ability to enforce each Mortgage Loan and
               to service the Mortgage Loans in accordance with the terms of
               this Agreement;

                    (ii) The Master Servicer has the full corporate power and
               authority to service each Mortgage Loan, and to execute, deliver
               and perform, and to enter into and consummate the transactions
               contemplated by this Agreement and has duly authorized by all
               necessary corporate action on the part of the Master Servicer the
               execution, delivery and performance of this Agreement; and this
               Agreement, assuming the due authorization, execution and delivery
               thereof by the other parties hereto, constitutes a legal, valid
               and binding obligation of the Master Servicer, enforceable
               against the Master Servicer in accordance with its terms, except
               to the extent that (a) the enforceability thereof may be limited
               by bankruptcy, insolvency, moratorium, receivership and other
               similar laws relating to creditors' rights generally and (b) the
               remedy of specific performance and injunctive and other forms of


                                       42

<PAGE>



               equitable relief may be subject to the equitable defenses and to
               the discretion of the court before which any proceeding therefor
               may be brought;

                   (iii) The execution and delivery of this Agreement by the
               Master Servicer, the servicing of the Mortgage Loans by the
               Master Servicer hereunder, the consummation of any other of the
               transactions herein contemplated, and the fulfillment of or
               compliance with the terms hereof are in the ordinary course of
               business of the Master Servicer and will not (A) result in a
               breach of any term or provision of the charter or by-laws of the
               Master Servicer or (B) conflict with, result in a breach,
               violation or acceleration of, or result in a default under, the
               terms of any other material agreement or instrument to which the
               Master Servicer is a party or by which it may be bound, or any
               statute, order or regulation applicable to the Master Servicer of
               any court, regulatory body, administrative agency or governmental
               body having jurisdiction over the Master Servicer; and the Master
               Servicer is not a party to, bound by, or in breach or violation
               of any indenture or other agreement or instrument, or subject to
               or in violation of any statute, order or regulation of any court,
               regulatory body, administrative agency or governmental body
               having jurisdiction over it, which materially and adversely
               affects or, to the Master Servicer's knowledge, would in the
               future materially and adversely affect, (x) the ability of the
               Master Servicer to perform its obligations under this Agreement
               or (y) the business, operations, financial condition, properties
               or assets of the Master Servicer taken as a whole;

                    (iv) The Master Servicer is an approved seller/servicer for
               Fannie Mae or Freddie Mac in good standing and is a HUD approved
               mortgagee pursuant to Section 203 of the National Housing Act;

                     (v) No litigation is pending against the Master Servicer
               that would materially and adversely affect the execution,
               delivery or enforceability of this Agreement or the ability of
               the Master Servicer to service the Mortgage Loans or to perform
               any of its other obligations hereunder in accordance with the
               terms hereof;

                    (vi) No consent, approval, authorization or order of any
               court or governmental agency or body is required for the
               execution, delivery and performance by the Master Servicer of, or
               compliance by the Master Servicer with, this Agreement or the
               consummation of the transactions contemplated by this Agreement,
               except for such consents, approvals, authorizations or orders, if
               any, that have been obtained prior to the Closing Date; and

                   (vii) The Master Servicer covenants that its computer and
               other systems used in servicing the Mortgage Loans operate in a
               manner such that the Master Servicer can service the Mortgage
               Loans in accordance with the terms of this Agreement.

               It is understood and agreed that the representations, warranties
and covenants set forth in this Section 2.05 shall survive delivery of the
Mortgage Files to the Trustee and shall inure to the


                                       43

<PAGE>



benefit of the Trustee, the Trust Administrator, the Depositor and the
Certificateholders. Upon discovery by any of the Depositor, the Master Servicer,
the Trust Administrator or the Trustee of a breach of any of the foregoing
representations, warranties and covenants which materially and adversely affects
the value of any Mortgage Loan or the interests therein of the
Certificateholders, the party discovering such breach shall give prompt written
notice (but in no event later than two Business Days following such discovery)
to the Trustee. Subject to Section 7.01, the obligation of the Master Servicer
set forth in Section 2.03(c) to cure breaches shall constitute the sole remedies
against the Master Servicer available to the Certificateholders, the Depositor,
the Trust Administrator or the Trustee on behalf of the Certificateholders
respecting a breach of the representations, warranties and covenants contained
in this Section 2.05.

               SECTION 2.06.          Issuance of the Certificates.

               The Trustee acknowledges the assignment to it of the Mortgage
Loans and the delivery to it of the Mortgage Files, subject to the provisions of
Section 2.01 and Section 2.02, together with the assignment to it of all other
assets included in REMIC I delivered on the date hereof, receipt of which is
hereby acknowledged. Concurrently with such assignment and delivery of such
assets delivered on the date hereof and in exchange therefor, the Trustee,
pursuant to the written request of the Depositor executed by an officer of the
Depositor, has executed, authenticated and delivered to or upon the order of the
Depositor, the Certificates in authorized denominations. The interests evidenced
by the Certificates constitute the entire beneficial ownership interest in REMIC
I.





                                       44

<PAGE>



                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                              OF THE MORTGAGE LOANS

               SECTION 3.01.          Master Servicer to Act as Master Servicer.


        The Master Servicer shall service and administer the Mortgage Loans on
behalf of the Trustee and in the best interests of and for the benefit of the
Certificateholders (as determined by the Master Servicer in its reasonable
judgment) in accordance with the terms of this Agreement and the respective
Mortgage Loans and, to the extent consistent with such terms, in the same manner
in which it services and administers similar mortgage loans for its own
portfolio, giving due consideration to customary and usual standards of practice
of prudent mortgage lenders and loan servicers administering similar mortgage
loans but without regard to:

                     (i) any relationship that the Master Servicer, any
               Sub-Servicer or any Affiliate of the Master Servicer or any
               Sub-Servicer may have with the related Mortgagor;

                     (ii) the ownership of any Certificate by the Master
               Servicer or any Affiliate of the Master Servicer;

                     (iii) the Master Servicer's obligation to make P&I Advances
               or Servicing Advances; or

                     (iv) the Master Servicer's or any Sub-Servicer's right to
               receive compensation for its services hereunder or with respect
               to any particular transaction.

To the extent consistent with the foregoing, the Master Servicer shall also seek
to maximize the timely and complete recovery of principal and interest on the
Mortgage Notes. Subject only to the above-described servicing standards and the
terms of this Agreement and of the respective Mortgage Loans, the Master
Servicer shall have full power and authority, acting alone or through
Sub-Servicers as provided in Section 3.02, to do or cause to be done any and all
things in connection with such servicing and administration which it may deem
necessary or desirable. Without limiting the generality of the foregoing, the
Master Servicer in its own name or in the name of a Sub-Servicer is hereby
authorized and empowered by the Trustee when the Master Servicer believes it
appropriate in its best judgment in accordance with the servicing standards set
forth above, to execute and deliver, on behalf of the Certificateholders and the
Trustee, and upon notice to the Trustee, any and all instruments of satisfaction
or cancellation, or of partial or full release or discharge, and all other
comparable instruments, with respect to the Mortgage Loans and the Mortgaged
Properties and to institute foreclosure proceedings or obtain a deed-in-lieu of
foreclosure so as to convert the ownership of such properties, and to hold or
cause to be held title to such properties, on behalf of the Trustee and
Certificateholders. The Master Servicer shall service and administer the
Mortgage Loans in accordance with applicable state and federal law and shall
provide to the Mortgagors any reports required to be provided to them thereby.
The Master Servicer shall also comply in the


                                       45

<PAGE>



performance of this Agreement with all reasonable rules and requirements of each
insurer under each Primary Mortgage Insurance Policy and any standard hazard
insurance policy. Subject to Section 3.17, the Trustee shall execute, at the
written request of the Master Servicer, and furnish to the Master Servicer and
any Sub-Servicer such documents as are necessary or appropriate to enable the
Master Servicer or any Sub-Servicer to carry out their servicing and
administrative duties hereunder, and the Trustee hereby grants to the Master
Servicer a power of attorney to carry out such duties. The Trustee shall not be
liable for the actions of the Master Servicer or any Sub-Servicers under such
powers of attorney.

               In accordance with the standards of the preceding paragraph, the
Master Servicer shall advance or cause to be advanced funds as necessary for the
purpose of effecting the timely payment of taxes and assessments on the
Mortgaged Properties, which advances shall be Servicing Advances reimbursable in
the first instance from related collections from the Mortgagors pursuant to
Section 3.09, and further as provided in Section 3.11. Any cost incurred by the
Master Servicer or by Sub- Servicers in effecting the timely payment of taxes
and assessments on a Mortgaged Property shall not, for the purpose of
calculating distributions to Certificateholders, be added to the unpaid
principal balance of the related Mortgage Loan, notwithstanding that the terms
of such Mortgage Loan so permit.

               Notwithstanding anything in this Agreement to the contrary, the
Master Servicer may not make any future advances with respect to a Mortgage Loan
(except as provided in Section 4.03) and the Master Servicer shall not (i)
permit any modification with respect to any Mortgage Loan that would change the
Mortgage Rate, reduce or increase the principal balance (except for reductions
resulting from actual payments of principal) or change the final maturity date
on such Mortgage Loan or (ii) permit any modification, waiver or amendment of
any term of any Mortgage Loan that would both (A) effect an exchange or
reissuance of such Mortgage Loan under Section 1001 of the Code (or final,
temporary or proposed Treasury regulations promulgated thereunder) and (B) cause
REMIC I to fail to qualify as a REMIC under the Code or the imposition of any
tax on "prohibited transactions" or "contributions after the startup date" under
the REMIC Provisions.

               The Master Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release the Master
Servicer from the responsibilities or liabilities arising under this Agreement.

               SECTION 3.02.          Sub-Servicing Agreements Between the
                                      Master Servicer and Sub-Servicers.

               (a) The Master Servicer may enter into Sub-Servicing Agreements
(provided that such agreements would not result in a withdrawal or a downgrading
by the Rating Agencies of the rating on any Class of Certificates) with
Sub-Servicers, for the servicing and administration of the Mortgage Loans.

               Each Sub-Servicer shall be (i) authorized to transact business in
the state or states in which the related Mortgaged Properties it is to service
are situated, if and to the extent required by applicable law to enable the
Sub-Servicer to perform its obligations hereunder and under the Sub- Servicing
Agreement, (ii) an institution approved as a mortgage loan originator by the
Federal


                                       46

<PAGE>



Housing Administration or an institution the deposit accounts of which are
insured by the FDIC and (iii) a Freddie Mac or Fannie Mae approved mortgage
servicer. Each Sub-Servicing Agreement must impose on the Sub-Servicer
requirements conforming to the provisions set forth in Section 3.08 and provide
for servicing of the Mortgage Loans consistent with the terms of this Agreement.
The Master Servicer will examine each Sub-Servicing Agreement and will be
familiar with the terms thereof. The terms of any Sub-Servicing Agreement will
not be inconsistent with any of the provisions of this Agreement. The Master
Servicer and the Sub-Servicers may enter into and make amendments to the
Sub-Servicing Agreements or enter into different forms of Sub-Servicing
Agreements; provided, however, that any such amendments or different forms shall
be consistent with and not violate the provisions of this Agreement, and that no
such amendment or different form shall be made or entered into which could be
reasonably expected to be materially adverse to the interests of the
Certificateholders, without the consent of the Holders of Certificates entitled
to at least 66% of the Voting Rights. Any variation without the consent of the
Holders of Certificates entitled to at least 66% of the Voting Rights from the
provisions set forth in Section 3.08 relating to insurance or priority
requirements of Sub-Servicing Accounts, or credits and charges to the Sub-
Servicing Accounts or the timing and amount of remittances by the Sub-Servicers
to the Master Servicer, are conclusively deemed to be inconsistent with this
Agreement and therefore prohibited. The Master Servicer shall deliver to the
Trustee copies of all Sub-Servicing Agreements, and any amendments or
modifications thereof, promptly upon the Master Servicer's execution and
delivery of such instruments.

               (b) As part of its servicing activities hereunder, the Master
Servicer (except as otherwise provided in the last sentence of this paragraph),
for the benefit of the Trustee and the Certificateholders, shall enforce the
obligations of each Sub-Servicer under the related Sub-Servicing Agreement and
of the Seller under the Mortgage Loan Purchase Agreement, including, without
limitation, any obligation to make advances in respect of delinquent payments as
required by a Sub- Servicing Agreement, or to purchase a Mortgage Loan on
account of missing or defective documentation or on account of a breach of a
representation, warranty or covenant, as described in Section 2.03(a). Such
enforcement, including, without limitation, the legal prosecution of claims,
termination of Sub-Servicing 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 Master Servicer, in its good faith business judgment, would require
were it the owner of the related Mortgage Loans. The Master Servicer shall pay
the costs of such enforcement at its own expense, and shall be reimbursed
therefor only (i) from a general recovery resulting from such enforcement, to
the extent, if any, that such recovery exceeds all amounts due in respect of the
related Mortgage Loans, or (ii) from a specific recovery of costs, expenses or
attorneys' fees against the party against whom such enforcement is directed.

               SECTION 3.03.          Successor Sub-Servicers.

               The Master Servicer shall be entitled to terminate any
Sub-Servicing Agreement and the rights and obligations of any Sub-Servicer
pursuant to any Sub-Servicing Agreement in accordance with the terms and
conditions of such Sub-Servicing Agreement. In the event of termination of any
Sub-Servicer, all servicing obligations of such Sub-Servicer shall be assumed
simultaneously by the Master Servicer without any act or deed on the part of
such Sub-Servicer or the Master Servicer, and the Master Servicer either shall
service directly the related Mortgage Loans


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<PAGE>



or shall enter into a Sub-Servicing Agreement with a successor Sub-Servicer
which qualifies under Section 3.02.

               Any Sub-Servicing Agreement shall include the provision that such
agreement may be immediately terminated by the Trustee without fee, in
accordance with the terms of this Agreement, in the event that the Master
Servicer shall, for any reason, no longer be the Master Servicer (including
termination due to a Master Servicer Event of Default).

               SECTION 3.04.          Liability of the Master Servicer.

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

               SECTION 3.05.          No Contractual Relationship Between
                                      Sub-Servicers and Trustee or
                                      Certificateholders.

               Any Sub-Servicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Sub-Servicer
in its capacity as such shall be deemed to be between the Sub-Servicer and the
Master Servicer alone, and the Trustee and the Certificateholders shall not be
deemed parties thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to the Sub-Servicer except as set forth in Section
3.06. The Master Servicer shall be solely liable for all fees owed by it to any
Sub-Servicer, irrespective of whether the Master Servicer's compensation
pursuant to this Agreement is sufficient to pay such fees.

               SECTION 3.06.          Assumption or Termination of Sub-Servicing
                                      Agreements by Trustee.

               In the event the Master Servicer shall for any reason no longer
be the master servicer (including by reason of the occurrence of a Master
Servicer Event of Default), the Trustee or its designee shall thereupon assume
all of the rights and obligations of the Master Servicer under each
Sub-Servicing Agreement that the Master Servicer may have entered into, unless
the Trustee elects to terminate any Sub-Servicing Agreement in accordance with
its terms as provided in Section 3.03. Upon such assumption, the Trustee, its
designee or the successor servicer for the Trustee appointed pursuant to Section
7.02 shall be deemed, subject to Section 3.03, to have assumed all of the Master
Servicer's interest therein and to have replaced the Master Servicer as a party
to each Sub-Servicing Agreement to the same extent as if each Sub-Servicing
Agreement had been assigned to the assuming party, except that (i) the Master
Servicer shall not thereby be relieved of any liability or


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obligations under any Sub-Servicing Agreement and (ii) none of the Trustee, its
designee or any successor Master Servicer shall be deemed to have assumed any
liability or obligation of the Master Servicer that arose before it ceased to be
the Master Servicer.

               The Master Servicer at its expense shall, upon request of the
Trustee, deliver to the assuming party all documents and records relating to
each Sub-Servicing Agreement and the Mortgage Loans then being serviced and an
accounting of amounts collected and held by or on behalf of it, and otherwise
use its best efforts to effect the orderly and efficient transfer of the Sub-
Servicing Agreements to the assuming party.

               SECTION 3.07.          Collection of Certain Mortgage Loan
                                      Payments.

               The Master Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Mortgage Loans, 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 and
any other applicable insurance policies, follow such collection procedures as it
would follow with respect to mortgage loans comparable to the Mortgage Loans and
held for its own account. Consistent with the foregoing, the Master Servicer may
in its discretion (i) waive any late payment charge or, if applicable, penalty
interest, only upon determining that the coverage of such Mortgage Loan by the
related Primary Mortgage Insurance Policy, if any, will not be affected, or (ii)
extend the due dates for Monthly Payments due on a Mortgage Note for a period of
not greater than 180 days; provided that any extension pursuant to clause (ii)
above shall not affect the amortization schedule of any Mortgage Loan for
purposes of any computation hereunder, except as provided below. In the event of
any such arrangement pursuant to clause (ii) above, the Master Servicer shall
make timely advances on such Mortgage Loan during such extension pursuant to
Section 4.03 and in accordance with the amortization schedule of such Mortgage
Loan without modification thereof by reason of such arrangements.
Notwithstanding the foregoing, in the event that any Mortgage Loan is in default
or, in the judgment of the Master Servicer, such default is reasonably
foreseeable, the Master Servicer, consistent with the standards set forth in
Section 3.01, may also accept payment from the related Mortgagor of an amount
less than the Stated Principal Balance in final satisfaction of such Mortgage
Loan (such payment, a "Short Pay-off") or consent to the postponement of strict
compliance with any such term or otherwise grant indulgence to any Mortgagor.

               SECTION 3.08.          Sub-Servicing Accounts.

               In those cases where a Sub-Servicer is servicing a Mortgage Loan
pursuant to a Sub- Servicing Agreement, the Sub-Servicer will be required to
establish and maintain one or more accounts (collectively, the "Sub-Servicing
Account"). The Sub-Servicing Account shall be an Eligible Account and shall
comply with all requirements of this Agreement relating to the Collection
Account. The Sub-Servicer shall deposit in the clearing account (which account
must be an Eligible Account) in which it customarily deposits payments and
collections on mortgage loans in connection with its mortgage loan servicing
activities on a daily basis, and in no event more than two Business Days after
the Sub-Servicer's receipt thereof, all proceeds of Mortgage Loans received by
the Sub- Servicer less its servicing compensation to the extent permitted by the
Sub-Servicing Agreement, and shall thereafter deposit such amounts in the
Sub-Servicing Account, in no event more than one


                                       49

<PAGE>



Business Day after the deposit of such funds into the clearing account. The
Sub-Servicer shall thereafter deposit such proceeds in the Collection Account or
remit such proceeds to the Master Servicer for deposit in the Collection Account
not later than two Business Days after the deposit of such amounts in the
Sub-Servicing Account. For purposes of this Agreement, the Master Servicer shall
be deemed to have received payments on the Mortgage Loans when the Sub-Servicer
receives such payments.

               SECTION 3.09.          Collection of Taxes, Assessments and
                                      Similar Items; Servicing Accounts.

               The Master Servicer shall establish and maintain one or more
accounts (the "Servicing Accounts"), into which all collections from the
Mortgagors (or related advances from Sub-Servicers) for the payment of ground
rents, taxes, assessments, fire and hazard insurance premiums, Primary Mortgage
Insurance Premiums, water charges, sewer rents and comparable items for the
account of the Mortgagors ("Escrow Payments") shall be deposited and retained.
Servicing Accounts shall be Eligible Accounts. The Master Servicer shall deposit
in the clearing account (which account must be an Eligible Account) in which it
customarily deposits payments and collections on mortgage loans in connection
with its mortgage loan servicing activities on a daily basis, and in no event
more than two Business Days after the Master Servicer's receipt thereof, all
Escrow Payments collected on account of the Mortgage Loans and shall thereafter
deposit such Escrow Payments in the Servicing Accounts, in no event more than
one Business Day after the deposit of such funds in the clearing account, for
the purpose of effecting the payment of any such items as required under the
terms of this Agreement. Withdrawals of amounts from a Servicing Account may be
made only to (i) effect payment of Escrow Payments; (ii) reimburse the Master
Servicer (or a Sub-Servicer to the extent provided in the related Sub-Servicing
Agreement) out of related collections for any advances made pursuant to Section
3.01 (with respect to taxes and assessments) and Section 3.14 (with respect to
hazard insurance); (iii) refund to Mortgagors any sums as may be determined to
be overages; (iv) pay interest, if required and as described below, to
Mortgagors on balances in the Servicing Account; (v) clear and terminate the
Servicing Account at the termination of the Master Servicer's obligations and
responsibilities in respect of the Mortgage Loans under this Agreement in
accordance with Article IX; or (vi) recover amounts deposited in error. As part
of its servicing duties, the Master Servicer or Sub-Servicers shall pay to the
Mortgagors interest on funds in Servicing Accounts, to the extent required by
law and, to the extent that interest earned on funds in the Servicing Accounts
is insufficient, to pay such interest from its or their own funds, without any
reimbursement therefor. To the extent that a Mortgage does not provide for
Escrow Payments, the Master Servicer shall determine whether any such payments
are made by the Mortgagor in a manner and at a time that avoids the loss of the
Mortgaged Property due to a tax sale or the foreclosure of a tax lien. The
Master Servicer assumes full responsibility for the payment of all such bills
and shall effect 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.

               SECTION 3.10.          Collection Account and Distribution
                                      Account.

               (a) On behalf of the Trust Fund, the Master Servicer shall
establish and maintain one or more accounts (such account or accounts, the
"Collection Account"), held in trust for the


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<PAGE>



benefit of the Trustee and the Certificateholders. On behalf of the Trust Fund,
the Master Servicer shall deposit or cause to be deposited in the clearing
account (which account must be an Eligible Account) in which it customarily
deposits payments and collections on mortgage loans in connection with its
mortgage loan servicing activities on a daily basis, and in no event more than
two Business Days after the Master Servicer's receipt thereof, and shall
thereafter deposit in the Collection Account, in no event more than one Business
Day after the deposit of such funds into the clearing account, as and when
received or as otherwise required hereunder, the following payments and
collections received or made by it from and after the Cut-off Date (other than
in respect of principal or interest on the related Mortgage Loans due on or
before the Cut-off Date), or payments (other than Principal Prepayments)
received by it on or prior to the Cut-off Date but allocable to a Due Period
subsequent thereto:

                     (i) all payments on account of principal, including
               Principal Prepayments, on the Mortgage Loans;

                     (ii) all payments on account of interest (net of the
               related Servicing Fee) on each Mortgage Loan;

                     (iii) all Insurance Proceeds, Trailing Recoveries and
               Liquidation Proceeds (other than proceeds collected in respect of
               any particular REO Property and amounts paid by the Master
               Servicer in connection with a purchase of Mortgage Loans and REO
               Properties pursuant to Section 9.01);

                     (iv) any amounts required to be deposited pursuant to
               Section 3.12 in connection with any losses realized on Permitted
               Investments with respect to funds held in the Collection Account;

                     (v) any amounts required to be deposited by the Master
               Servicer pursuant to the second paragraph of Section 3.14(a) in
               respect of any blanket policy deductibles;

                     (vi) all proceeds of any Mortgage Loan repurchased or
               purchased in accordance with Section 2.03 or Section 9.01; and

                     (vii) all amounts required to be deposited in connection
               with shortfalls in principal amount of Qualified Substitute
               Mortgage Loans pursuant to Section 2.03.

               For purposes of the immediately preceding sentence, the Cut-off
Date with respect to any Qualified Substitute Mortgage Loan shall be deemed to
be the date of substitution.

               The foregoing requirements for deposit in the Collection Accounts
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges or
assumption fees need not be deposited by the Master Servicer in the Collection
Account. In the event the Master Servicer shall deposit in the Collection
Account any amount not required to be deposited therein, it may at any time
withdraw such amount from the Collection Account, any provision herein to the
contrary notwithstanding.


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<PAGE>



               (b) On behalf of the Trust Fund, the Trustee shall establish and
maintain one or more accounts (such account or accounts, the "Distribution
Account"), held in trust for the benefit of the Certificateholders. On behalf of
the Trust Fund, the Master Servicer shall deliver to the Trustee in immediately
available funds for deposit in the Distribution Account on or before 3:00 p.m.
New York time (i) on the Master Servicer Remittance Date, that portion of the
Available Distribution Amount (calculated without regard to the references in
clause (2) of the definition thereof to amounts that may be withdrawn from the
Distribution Account) for the related Distribution Date then on deposit in the
Collection Account, and (ii) on each Business Day as of the commencement of
which the balance on deposit in the Collection Account exceeds $75,000 following
any withdrawals pursuant to the next succeeding sentence, the amount of such
excess, but only if the Collection Account constitutes an Eligible Account
solely pursuant to clause (ii) of the definition of "Eligible Account." If the
balance on deposit in the Collection Account exceeds $75,000 as of the
commencement of business on any Business Day and the Collection Account
constitutes an Eligible Account solely pursuant to clause (ii) of the definition
of "Eligible Account," the Master Servicer shall, on or before 3:00 p.m. New
York time on such Business Day, withdraw from the Collection Account any and all
amounts payable or reimbursable to the Depositor, the Master Servicer, the
Trustee, the Trust Administrator, the Seller or any Sub-Servicer pursuant to
Section 3.11 and shall pay such amounts to the Persons entitled thereto.

               (c) Funds in the Collection Account and the Distribution Account
may be invested in Permitted Investments in accordance with the provisions set
forth in Section 3.12. The Master Servicer shall give notice to the Trustee, the
Trust Administrator and the Depositor of the location of the Collection Account
maintained by it when established and prior to any change thereof. The Trustee
shall give notice to the Master Servicer, the Trust Administrator and the
Depositor of the location of the Distribution Account when established and prior
to any change thereof.

               (d) Funds held in the Collection Account at any time may be
delivered by the Master Servicer to the Trustee for deposit in an account (which
may be the Distribution Account and must satisfy the standards for the
Distribution Account as set forth in the definition thereof) and for all
purposes of this Agreement shall be deemed to be a part of the Collection
Account; provided, however, that the Trustee shall have the sole authority to
withdraw any funds held pursuant to this subsection (d). In the event the Master
Servicer shall deliver to the Trustee for deposit in the Distribution Account
any amount not required to be deposited therein, it may at any time request that
the Trustee withdraw such amount from the Distribution Account and remit to it
any such amount, any provision herein to the contrary notwithstanding. In
addition, the Master Servicer shall deliver to the Trustee from time to time for
deposit, and upon written notification from the Master Servicer, the Trustee
shall so deposit, in the Distribution Account:

                     (i) any P&I Advances, as required pursuant to Section 4.03,
               unless delivered directly to the Trustee by an Advancing Person;

                     (ii) any amounts required to be deposited pursuant to
               Section 3.23(d) or (f) in connection with any REO Property;



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<PAGE>



                     (iii) any amounts to be paid by the Master Servicer in
               connection with a purchase of Mortgage Loans and REO Properties
               pursuant to Section 9.01;

                     (iv) any amounts required to be deposited pursuant to
               Section 3.24 in connection with any Prepayment Interest
               Shortfalls; and

                     (v) any Stayed Funds, as soon as permitted by the federal
               bankruptcy court having jurisdiction in such matters.

               (e) Promptly upon receipt of any Stayed Funds, whether from the
Master Servicer, a trustee in bankruptcy, or federal bankruptcy court or other
source, the Trustee shall deposit such funds in the Distribution Account,
subject to withdrawal thereof pursuant to Section 7.02(b) or as otherwise
permitted hereunder.

               (f) The Master Servicer shall deposit in the Collection Account
any amounts required to be deposited pursuant to Section 3.12(b) in connection
with losses realized on Permitted Investments with respect to funds held in the
Collection Account.

               SECTION 3.11.          Withdrawals from the Collection Account
                                      and Distribution Account.

               (a) The Master Servicer shall, from time to time, make
withdrawals from the Collection Account for any of the following purposes or as
described in Section 4.03:

                     (i) to remit to the Trustee for deposit in the Distribution
               Account the amounts required to be so remitted pursuant to
               Section 3.10(b) or permitted to be so remitted pursuant to the
               first sentence of Section 3.10(d);

                    (ii) subject to Section 3.16(d), to reimburse the Master
               Servicer for P&I Advances, but only to the extent of amounts
               received which represent Late Collections (net of the related
               Servicing Fees) of Monthly Payments on Mortgage Loans with
               respect to which such P&I Advances were made in accordance with
               the provisions of Section 4.03;

                   (iii) subject to Section 3.16(d), to pay the Master Servicer
               or any Sub- Servicer (A) any unpaid Servicing Fees, (B) any
               unreimbursed Servicing Advances with respect to each Mortgage
               Loan, but only to the extent of any Liquidation Proceeds,
               Insurance Proceeds or other amounts as may be collected by the
               Master Servicer from a Mortgagor, or otherwise received with
               respect to such Mortgage Loan and (C) any nonrecoverable
               Servicing Advances following the final liquidation of a Mortgage
               Loan, but only to the extent that Late Collections, Liquidation
               Proceeds and Insurance Proceeds received with respect to such
               Mortgage Loan are insufficient to reimburse the Master Servicer
               or any Sub-Servicer for such Servicing Advances;



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<PAGE>



                    (iv) to pay to the Master Servicer as servicing compensation
               (in addition to the Servicing Fee) on the Master Servicer
               Remittance Date any interest or investment income earned on funds
               deposited in the Collection Account;

                     (v) to pay to the Master Servicer, the Depositor or the
               Seller, as the case may be, with respect to each Mortgage Loan
               that has previously been purchased or replaced pursuant to
               Section 2.03 or Section 3.16(c) all amounts received thereon
               subsequent to the date of purchase or substitution, as the case
               may be;

                    (vi) to reimburse the Master Servicer for any P&I Advance
               previously made which the Master Servicer has determined to be a
               Nonrecoverable P&I Advance in accordance with the provisions of
               Section 4.03;

                   (vii) to reimburse the Master Servicer or the Depositor for
               expenses incurred by or reimbursable to the Master Servicer or
               the Depositor, as the case may be, pursuant to Section 6.03;

                  (viii) to reimburse the Master Servicer or the Trustee, as the
               case may be, for expenses reasonably incurred in respect of the
               breach or defect giving rise to the purchase obligation under
               Section 2.03 or Section 2.04 of this Agreement that were included
               in the Purchase Price of the Mortgage Loan, including any
               expenses arising out of the enforcement of the purchase
               obligation;

                   (ix) to pay, or to reimburse the Master Servicer for advances
               in respect of expenses incurred in connection with any Mortgage
               Loan pursuant to Section 3.16(b);

                   (x) [reserved]; and

                   (xi) to clear and terminate the Collection Account pursuant
               to Section 9.01.

               The Master Servicer shall keep and maintain separate accounting,
on a Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account, to the extent held by or on behalf of
it, pursuant to subclauses (ii), (iii), (iv), (v), (vi), (viii) and (ix) above.
The Master Servicer shall provide written notification to the Trustee and the
Trust Administrator, on or prior to the next succeeding Master Servicer
Remittance Date, upon making any withdrawals from the Collection Account
pursuant to subclause (vii) above.

               (b) The Trustee shall, from time to time, make withdrawals from
the Distribution Account, for any of the following purposes, without priority:

                     (i) to make distributions to Certificateholders in
               accordance with Section 4.01;



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<PAGE>



                    (ii) to pay to itself and the Trust Administrator (if the
               Trust Administrator is not the Master Servicer) amounts to which
               each is entitled pursuant to Section 8.05 and any other
               Extraordinary Trust Fund Expenses;

                     (iii) to pay to the Master Servicer any interest income
               earned on funds deposited in the Distribution Account pursuant to
               Section 3.12(c);

                     (iv) to reimburse itself pursuant to Section 7.02;

                     (v) to pay any amounts in respect of taxes pursuant to
               10.01(g)(iii);

                     (vi) [reserved];

                     (vii) to reimburse itself for any P&I Advance made by it
               under Section 7.01 (if not reimbursed by the Master Servicer) to
               the same extent the Master Servicer would be entitled to
               reimbursement under Section 3.11(a); and

                     (viii) to clear and terminate the Distribution Account
               pursuant to Section 9.01.

               SECTION 3.12.          Investment of Funds in the Collection
                                      Account and the Distribution Account.

               (a) The Master Servicer may direct any depository institution
maintaining the Collection Account (for purposes of this Section 3.12, an
"Investment Account"), and the Trustee, upon written instruction received from
the Master Servicer shall direct any depository institution maintaining the
Distribution Account (for purposes of this Section 3.12, also an "Investment
Account"), to invest the funds in such Investment Account in one or more
Permitted Investments specified in such instruction bearing interest or sold at
a discount, and maturing, unless payable on demand, (i) no later than the
Business Day immediately preceding the date on which such funds are required to
be withdrawn from such account pursuant to this Agreement, if a Person other
than the Trustee is the obligor thereon, and (ii) no later than the date on
which such funds are required to be withdrawn from such account pursuant to this
Agreement, if the Trustee is the obligor thereon. All such Permitted Investments
shall be held to maturity, unless payable on demand. Any investment of funds in
an Investment Account shall be made in the name of the Trustee (in its capacity
as such) or in the name of a nominee of the Trustee. The Trustee shall be
entitled to sole possession (except with respect to investment direction of
funds held in the Collection Account and any income and gain realized thereon)
over each such investment, and any certificate or other instrument evidencing
any such investment shall be delivered directly to the Trustee or its agent,
together with any document of transfer necessary to transfer title to such
investment to the Trustee or its nominee. In the event amounts on deposit in an
Investment Account are at any time invested in a Permitted Investment payable on
demand, the Trustee shall:

               (x)     consistent with any notice required to be given
                       thereunder, demand that payment thereon be made on the
                       last day such Permitted Investment may otherwise mature
                       hereunder in an amount equal to the lesser of (1) all


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<PAGE>



                       amounts then payable thereunder and (2) the amount
                       required to be withdrawn on such date; and

               (y)     demand payment of all amounts due thereunder promptly
                       upon determination by a Responsible Officer of the
                       Trustee that such Permitted Investment would not
                       constitute a Permitted Investment in respect of funds
                       thereafter on deposit in the Investment Account.

               (b) All income and gain realized from the investment of funds
deposited in the Collection Account held by or on behalf of the Master Servicer,
shall be for the benefit of the Master Servicer and shall be subject to its
withdrawal in accordance with Section 3.11. The Master Servicer shall deposit in
the Collection Account the amount of any loss of principal incurred in respect
of any such Permitted Investment made with funds in such accounts immediately
upon realization of such loss.

               (c) All income and gain realized from the investment of funds
deposited in the Distribution Account held by or on behalf of the Trustee, shall
be for the benefit of the Master Servicer and shall be subject to its withdrawal
at any time. The Trustee shall remit to the Master Servicer any income and gain
realized from the investment of funds deposited in the Distribution Account on
the last Business Day of each month. The Master Servicer shall remit to the
Trustee for deposit in the Distribution Account, the amount of any loss of
principal incurred in respect of any such Permitted Investment made with funds
in such accounts immediately upon realization of such loss.

               (d) Except as otherwise expressly provided in this Agreement, if
any default occurs in the making of a payment due under any Permitted
Investment, or if a default occurs in any other performance required under any
Permitted Investment, the Trustee may and, subject to Section 8.01 and Section
8.02(a)(v), upon the request of the Holders of Certificates representing more
than 50% of the Voting Rights allocated to any Class of Certificates, shall take
such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate proceedings.

               SECTION 3.13.          Maintenance of the Primary Mortgage
                                      Insurance Policies; Collections
                                      Thereunder.

               The Master Servicer will maintain or cause the related
Sub-Servicer, if any, to maintain in full force and effect, if required under
the Mortgage Loan Purchase Agreement and to the extent available, a Primary
Mortgage Insurance Policy with respect to each Mortgage Loan so insured as of
the Closing Date (or, in the case of a Qualified Substitute Mortgage Loan, on
the date of substitution). Such coverage will be maintained with respect to each
such Mortgage Loan for so long as it is outstanding, subject to any applicable
laws or until the related Loan-to-Value Ratio is reduced to less than or equal
to 80% based on Mortgagor payments. The Master Servicer shall cause the premium
for each Primary Mortgage Insurance Policy to be paid on a timely basis and
shall pay such premium out of its own funds if it is not otherwise paid. The
Master Servicer or the related Sub-Servicer, if any, will not cancel or refuse
to renew any such Primary Mortgage Insurance Policy in effect on the Closing
Date (or, in the case of a Qualified Substitute Mortgage Loan, on the date


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<PAGE>



of substitution) that is required to be kept in force under this Agreement
unless a replacement Primary Mortgage Insurance Policy for such canceled or
non-renewed policy is obtained from and maintained with a Qualified Insurer.

               The Master Servicer shall not take, or permit any Sub-Servicer to
take, any action which would result in non-coverage under any applicable Primary
Mortgage Insurance Policy of any loss which, but for the actions of the Master
Servicer or Sub-Servicer, would have been covered thereunder. The Master
Servicer will comply in the performance of this Agreement with all reasonable
rules and requirements of each insurer under each Primary Mortgage Insurance
Policy. In connection with any assumption and modification agreement or
substitution of liability agreement entered into or to be entered into pursuant
to Section 3.15, the Master Servicer shall promptly notify the insurer under the
related Primary Mortgage Insurance Policy, if any, of such assumption in
accordance with the terms of such policies and shall take all actions which may
be required by such insurer as a condition to the continuation of coverage under
the Primary Mortgage Insurance Policy. If any such Primary Mortgage Insurance
Policy is terminated as a result of such assumption, the Master Servicer or the
related Sub-Servicer shall obtain a replacement Primary Mortgage Insurance
Policy as provided above.

               In connection with its activities as administrator and servicer
of the Mortgage Loans, the Master Servicer agrees to prepare and present, on
behalf of itself, the Trustee and the Certificateholders, 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. Any amounts collected by the Master
Servicer under any Primary Mortgage Insurance Policy shall be deposited in the
Collection Account, subject to withdrawal pursuant to Section 3.11; and any
amounts collected by the Master Servicer under any Primary Mortgage Insurance
Policy in respect of any REO Property shall be deposited in the Collection
Account, subject to withdrawal pursuant to Section 3.23. In those cases in which
a Mortgage Loan is serviced by a Sub-Servicer, the Sub-Servicer, on behalf of
itself, the Trustee, and the Certificateholders, will present claims to the
insurer under any Primary Mortgage Insurance Policy and all collections
thereunder shall be deposited initially in the Sub-Servicing Account.

               SECTION 3.14.          Maintenance of Hazard Insurance and Errors
                                      and Omissions and Fidelity Coverage.

               (a) The Master Servicer shall cause to be maintained for each
Mortgage Loan fire insurance with extended coverage on the related Mortgaged
Property in an amount which is at least equal to the least of (i) the current
principal balance of such Mortgage Loan, (ii) the amount necessary to fully
compensate for any damage or loss to the improvements that are a part of such
property on a replacement cost basis and (iii) the maximum insurable value of
the improvements which are a part of such Mortgaged Property, in each case in an
amount not less than such amount as is necessary to avoid the application of any
coinsurance clause contained in the related hazard insurance policy. The Master
Servicer shall also cause to be maintained fire insurance with extended coverage
on each REO Property in an amount which is at least equal to the lesser of (i)
the maximum insurable value of the improvements which are a part of such
property and (ii) the outstanding principal balance of the related Mortgage Loan
at the time it became an REO Property, plus accrued


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interest at the Mortgage Rate and related Servicing Advances. The Master
Servicer will comply in the performance of this Agreement with all reasonable
rules and requirements of each insurer under any such hazard policies. Any
amounts to be collected by the Master Servicer under any such policies (other
than amounts to be applied to the restoration or repair of the property subject
to the related Mortgage or amounts to be released to the Mortgagor in accordance
with the procedures that the Master Servicer would follow in servicing loans
held for its own account, subject to the terms and conditions of the related
Mortgage and Mortgage Note) shall be deposited in the Collection Account,
subject to withdrawal pursuant to Section 3.11, if received in respect of a
Mortgage Loan, or in the REO Account, subject to withdrawal pursuant to Section
3.23, if received in respect of an REO Property. Any cost incurred by the Master
Servicer in maintaining any such insurance shall not, for the purpose of
calculating distributions to Certificateholders, be added to the unpaid
principal balance of the related Mortgage Loan, notwithstanding that the terms
of such Mortgage Loan so permit. It is understood and agreed that no earthquake
or other additional insurance is to be required of any Mortgagor other than
pursuant to such applicable laws and regulations as shall at any time be in
force and as shall require such additional insurance. If the Mortgaged Property
or REO Property is at any time in an area identified in the Federal Register by
the Federal Emergency Management Agency as having special flood hazards, the
Master Servicer will cause to be maintained a flood insurance policy in respect
thereof. Such flood insurance shall be in an amount equal to the lesser of (i)
the unpaid principal balance of the related Mortgage Loan and (ii) the maximum
amount of such insurance available for the related Mortgaged Property under the
national flood insurance program (assuming that the area in which such Mortgaged
Property is located is participating in such program).

               In the event that the Master Servicer shall obtain and maintain a
blanket policy with an insurer having a General Policy Rating of A:X or better
in Best's Key Rating Guide (or such other rating that is comparable to such
rating) insuring against hazard losses on all of the Mortgage Loans, it shall
conclusively be deemed to have satisfied its obligations as set forth in the
first two sentences of this Section 3.14, it being understood and agreed that
such policy may contain a deductible clause, in which case the Master Servicer
shall, in the event that there shall not have been maintained on the related
Mortgaged Property or REO Property a policy complying with the first two
sentences of this Section 3.14, and there shall have been one or more losses
which would have been covered by such policy, deposit to the Collection Account
from its own funds the amount not otherwise payable under the blanket policy
because of such deductible clause. In connection with its activities as
administrator and servicer of the Mortgage Loans, the Master Servicer agrees to
prepare and present, on behalf of itself, the Trustee and the
Certificateholders, claims under any such blanket policy in a timely fashion in
accordance with the terms of such policy.

               (b) The Master Servicer shall keep in force during the term of
this Agreement a policy or policies of insurance covering errors and omissions
for failure in the performance of the Master Servicer's obligations under this
Agreement, which policy or policies shall be in such form and amount that would
meet the requirements of Fannie Mae or Freddie Mac if it were the purchaser of
the Mortgage Loans, unless the Master Servicer has obtained a waiver of such
requirements from Fannie Mae or Freddie Mac. The Master Servicer shall also
maintain a fidelity bond in the form and amount that would meet the requirements
of Fannie Mae or Freddie Mac, unless the Master Servicer has obtained a waiver
of such requirements from Fannie Mae or Freddie Mac. The Master Servicer shall
provide the Trustee (upon the Trustee's reasonable request) with copies of any
such insurance


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policies and fidelity bond. The Master Servicer shall be deemed to have complied
with this provision if an Affiliate of the Master Servicer has such errors and
omissions and fidelity bond coverage and, by the terms of such insurance policy
or fidelity bond, the coverage afforded thereunder extends to the Master
Servicer. Any such errors and omissions policy and fidelity bond shall by its
terms not be cancelable without thirty days' prior written notice to the
Trustee. The Master Servicer shall also cause each Sub-Servicer to maintain a
policy of insurance covering errors and omissions and a fidelity bond which
would meet such requirements.

               SECTION 3.15.          Enforcement of Due-On-Sale Clauses;
                                      Assumption Agreements.

               The Master Servicer will, to the extent it has knowledge of any
conveyance or prospective conveyance of any Mortgaged Property by any Mortgagor
(whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains or is to remain liable under the Mortgage Note and/or the
Mortgage), exercise its rights to accelerate the maturity of such Mortgage Loan
under the "due-on-sale" clause, if any, applicable thereto; provided, however,
that the Master Servicer shall not exercise any such rights if prohibited by law
from doing so or if the exercise of such rights would impair or threaten to
impair any recovery under the related Primary Mortgage Insurance Policy, if any.
If the Master Servicer reasonably believes it is unable under applicable law to
enforce such "due-on-sale" clause, or if any of the other conditions set forth
in the proviso to the preceding sentence apply, the Master Servicer will enter
into an assumption and modification agreement from or with the person to whom
such property has been conveyed or is proposed to be conveyed, pursuant to which
such person becomes liable under the Mortgage Note and, to the extent permitted
by applicable state law, the Mortgagor remains liable thereon. The Master
Servicer is also authorized to enter into a substitution of liability agreement
with such person, pursuant to which the original Mortgagor is released from
liability and such person is substituted as the Mortgagor and becomes liable
under the Mortgage Note, provided that no such substitution shall be effective
unless such person satisfies the underwriting criteria of the Master Servicer.
In connection with any assumption or substitution, the Master Servicer shall
apply such underwriting standards and follow such practices and procedures as
shall be normal and usual in its general mortgage servicing activities and as it
applies to other mortgage loans owned solely by it. The Master Servicer shall
not take or enter into any assumption and modification agreement, however,
unless (to the extent practicable in the circumstances) it shall have received
confirmation, in writing, of the continued effectiveness of any applicable
Primary Mortgage Insurance Policy or hazard insurance policy, or a new policy
meeting the requirements of this Section is obtained. Any fee collected by the
Master Servicer in respect of an assumption or substitution of liability
agreement will be retained by the Master Servicer as additional servicing
compensation. In connection with any such assumption, no material term of the
Mortgage Note (including but not limited to the related Mortgage Rate and the
amount of the Monthly Payment) may be amended or modified, except as otherwise
required pursuant to the terms thereof. The Master Servicer shall notify the
Trustee that any such substitution or assumption agreement has been completed by
forwarding to the Trustee the executed original of such substitution or
assumption agreement, which document shall be added to the related Mortgage File
and shall, for all purposes, be considered a part of such Mortgage File to the
same extent as all other documents and instruments constituting a part thereof.



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               Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Master Servicer shall not be deemed to be in default, breach
or any other violation of its obligations hereunder by reason of any assumption
of a Mortgage Loan by operation of law or by the terms of the Mortgage Note or
any assumption which the Master Servicer may be restricted by law from
preventing, for any reason whatever. For purposes of this Section 3.15, the term
"assumption" is deemed to also include a sale (of the Mortgaged Property)
subject to the Mortgage that is not accompanied by an assumption or substitution
of liability agreement.

               SECTION 3.16.          Realization Upon Defaulted Mortgage Loans.

               (a) The Master Servicer shall, consistent with the servicing
standard set forth in Section 3.01, foreclose upon or otherwise comparably
convert the ownership of properties securing such of the Mortgage Loans as come
into and continue in default and as to which no satisfactory arrangements can be
made for collection of delinquent payments pursuant to Section 3.07. The Master
Servicer shall be responsible for all costs and expenses incurred by it in any
such proceedings; provided, however, that such costs and expenses will be
recoverable as Servicing Advances by the Master Servicer as contemplated in
Section 3.11 and Section 3.23. The foregoing is subject to the provision that,
in any case in which Mortgaged Property shall have suffered damage from an
Uninsured Cause, the Master Servicer shall not be required to expend its own
funds toward the restoration of such property unless it shall determine in its
discretion that such restoration will increase the proceeds of liquidation of
the related Mortgage Loan after reimbursement to itself for such expenses.

               (b) Notwithstanding the foregoing provisions of this Section 3.16
or any other provision of this Agreement, with respect to any Mortgage Loan as
to which the Master Servicer has received actual notice of, or has actual
knowledge of, the presence of any toxic or hazardous substance on the related
Mortgaged Property, the Master Servicer shall not, on behalf of the Trustee,
either (i) obtain title to such Mortgaged Property as a result of or in lieu of
foreclosure or otherwise, or (ii) otherwise acquire possession of, or take any
other action with respect to, such Mortgaged Property, if, as a result of any
such action, the Trustee, the Trust Fund, the Trust Administrator, the Master
Servicer or the Certificateholders would be considered to hold title to, to be a
"mortgagee-in- possession" of, or to be an "owner" or "operator" of such
Mortgaged Property within the meaning of the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended from time to time,
or any comparable law, unless the Master Servicer has also previously
determined, based on its reasonable judgment and a report prepared by a Person
who regularly conducts environmental audits using customary industry standards,
that:

                     (1) such Mortgaged Property is in compliance with
               applicable environmental laws or, if not, that it would be in the
               best economic interest of the Trust Fund to take such actions as
               are necessary to bring the Mortgaged Property into compliance
               therewith; and

                     (2) there are no circumstances present at such Mortgaged
               Property relating to the use, management or disposal of any
               hazardous substances, hazardous materials, hazardous wastes, or
               petroleum-based materials for which investigation, testing,
               monitoring, containment, clean-up or remediation could be
               required under


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               any federal, state or local law or regulation, or that if any
               such materials are present for which such action could be
               required, that it would be in the best economic interest of the
               Trust Fund to take such actions with respect to the affected
               Mortgaged Property.

               The cost of the environmental audit report contemplated by this
Section 3.23 shall be advanced by the Master Servicer, subject to the Master
Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.11(a)(ix), such right of reimbursement being prior to the
rights of Certificateholders to receive any amount in the Collection Account
received in respect of the affected Mortgage Loan or other Mortgage Loans.

               If the Master Servicer determines, as described above, that it is
in the best economic interest of the Trust Fund to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes or petroleum-based materials affecting any such Mortgaged Property, then
the Master Servicer shall take such action as it deems to be in the best
economic interest of the Trust Fund. The cost of any such compliance,
containment, cleanup or remediation shall be advanced by the Master Servicer,
subject to the Master Servicer's right to be reimbursed therefor from the
Collection Account as provided in Section 3.11(a)(ix), such right of
reimbursement being prior to the rights of Certificateholders to receive any
amount in the Collection Account received in respect of the affected Mortgage
Loan or other Mortgage Loans.

               (c) [Reserved].

               (d) Proceeds received in connection with any Final Recovery
Determination, as well as any recovery resulting from a partial collection of
Insurance Proceeds or Liquidation Proceeds, in respect of any Mortgage Loan,
will be applied in the following order of priority: first, to reimburse the
Master Servicer or any Sub-Servicer for any related unreimbursed Servicing
Advances and P&I Advances, pursuant to Section 3.11(a)(ii) or (a)(iii)(B);
second, to accrued and unpaid interest on the Mortgage Loan, to the date of the
Final Recovery Determination, or to the Due Date prior to the Distribution Date
on which such amounts are to be distributed if not in connection with a Final
Recovery Determination; and third, as a recovery of principal of the Mortgage
Loan. If the amount of the recovery so allocated to interest is less than the
full amount of accrued and unpaid interest due on such Mortgage Loan, the amount
of such recovery will be allocated by the Master Servicer as follows: first, to
unpaid Servicing Fees; and second, to the balance of the interest then due and
owing. The portion of the recovery so allocated to unpaid Servicing Fees shall
be reimbursed to the Master Servicer or any Sub-Servicer pursuant to Section
3.11(a)(iii)(A).

               SECTION 3.17.          Trustee to Cooperate; Release of Mortgage
                                      Files.

               (a) Upon the payment in full of any Mortgage Loan, or the receipt
by the Master Servicer of a notification that payment in full shall be escrowed
in a manner customary for such purposes, the Master Servicer will immediately
notify the Trustee by a certification in the form of Exhibit E-2 (which
certification shall include a statement to the effect that all amounts received
or to be received in connection with such payment which are required to be
deposited in the Collection


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Account pursuant to Section 3.10 have been or will be so deposited) of a
Servicing Officer and shall request delivery to it of the Mortgage File. Upon
receipt of such certification and request, the Trustee shall promptly release
the related Mortgage File to the Master Servicer. No expenses incurred in
connection with any instrument of satisfaction or deed of reconveyance shall be
chargeable to the Collection Account or the Distribution Account.

               The Trustee shall, at the written request and expense of any
Certificateholder, provide a written report to such Certificateholder of all
Mortgage Files released to the Master Servicer for servicing purposes.

               (b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any Primary Mortgage Insurance Policy or any other insurance policy relating to
the Mortgage Loans, the Trustee shall, upon request of the Master Servicer and
delivery to the Trustee of a Request for Release in the form of Exhibit E-l,
release the related Mortgage File to the Master Servicer, and the Trustee shall,
at the direction of the Master Servicer, execute such documents as shall be
necessary to the prosecution of any such proceedings. Such Request for Release
shall obligate the Master Servicer to return each and every document previously
requested from the Mortgage File to the Trustee when the need therefor by the
Master Servicer no longer exists, unless the Mortgage Loan has been liquidated
and the Liquidation Proceeds relating to the Mortgage Loan have been deposited
in the Collection 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, and the Master Servicer has delivered to the Trustee a
certificate of a Servicing Officer certifying as to the name and address of the
Person to which such Mortgage File or such document was delivered and the
purpose or purposes of such delivery. Upon receipt of a certificate of a
Servicing Officer stating that such Mortgage Loan was liquidated and that all
amounts received or to be received in connection with such liquidation that are
required to be deposited into the Collection Account have been so deposited, or
that such Mortgage Loan has become an REO Property, a copy of the Request for
Release shall be released by the Trustee to the Master Servicer.

               (c) Upon written certification of a Servicing Officer, the
Trustee shall execute and deliver to the Master Servicer any court pleadings,
requests for trustee's sale or other documents reasonably necessary to the
foreclosure or trustee's sale in respect of a Mortgaged Property or to any legal
action brought to obtain judgment against any Mortgagor on the Mortgage Note or
Mortgage or to obtain a deficiency judgment, or to enforce any other remedies or
rights provided by the Mortgage Note or Mortgage or otherwise available at law
or in equity. Each such certification shall include a request that such
pleadings or documents be executed by the Trustee and a statement as to the
reason such documents or pleadings are required and that the execution and
delivery thereof by the Trustee will not invalidate or otherwise affect the lien
of the Mortgage, except for the termination of such a lien upon completion of
the foreclosure or trustee's sale.

               SECTION 3.18.          Servicing Compensation.

               As compensation for the activities of the Master Servicer
hereunder, the Master Servicer shall be entitled to the Servicing Fee with
respect to each Mortgage Loan payable solely


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from payments of interest in respect of such Mortgage Loan, subject to Section
3.24. In addition, the Master Servicer shall be entitled to recover unpaid
Servicing Fees out of Insurance Proceeds or Liquidation Proceeds to the extent
permitted by Section 3.11(a)(iii)(A) and out of amounts derived from the
operation and sale of an REO Property to the extent permitted by Section 3.23.
The right to receive the Servicing Fee may not be transferred in whole or in
part except in connection with the transfer of all of the Master Servicer's
responsibilities and obligations under this Agreement.

               Additional servicing compensation in the form of assumption fees,
late payment charges and other similar fees and charges shall be retained by the
Master Servicer (subject to Section 3.24) only to the extent such fees or
charges are received by the Master Servicer. The Master Servicer shall also be
entitled pursuant to Section 3.11(a)(iv) to withdraw from the Collection
Account, and pursuant to Section 3.23(b) to withdraw from any REO Account, as
additional servicing compensation, interest or other income earned on deposits
therein, subject to Section 3.12 and Section 3.24. The Master Servicer shall be
required to pay all expenses incurred by it in connection with its servicing
activities hereunder (including premiums due under the Primary Insurance
Policies, if any, premiums for the insurance required by Section 3.14, to the
extent such premiums are not paid by the related Mortgagors or by a
Sub-Servicer, servicing compensation of each Sub-Servicer, and to the extent
provided herein in Section 8.05, the fees and expenses of the Trustee) and shall
not be entitled to reimbursement therefor except as specifically provided
herein.

               SECTION 3.19.          Reports to the Trustee; Collection Account
                                      Statements.

               Not later than fifteen days after each Distribution Date, the
Master Servicer shall forward to the Trustee, upon the request of the Trustee, a
statement prepared by the Master Servicer setting forth the status of the
Collection Account as of the close of business on the last day of the calendar
month relating to such Distribution Date and showing, for the period covered by
such statement, the aggregate amount of deposits into and withdrawals from the
Collection Account of each category of deposit specified in Section 3.10(a) and
each category of withdrawal specified in Section 3.11. Such statement may be in
the form of the then current Fannie Mae Monthly Accounting Report for its
Guaranteed Mortgage Pass-Through Program with appropriate additions and changes,
and shall also include information as to the aggregate of the outstanding
principal balances of all of the Mortgage Loans as of the last day of the
calendar month immediately preceding such Distribution Date. Copies of such
statement shall be provided by the Trustee to any Certificateholder and to any
Person identified to the Trustee as a prospective transferee of a Certificate,
upon the request and at the expense of the requesting party, provided such
statement is delivered by the Master Servicer to the Trustee.

               SECTION 3.20.          Statement as to Compliance.

               The Master Servicer will deliver to the Trust Administrator, the
Trustee, the Depositor and the Rating Agencies on or before April 15 of each
calendar year commencing in 2001, an Officers' Certificate stating, as to each
signatory thereof, that (i) a review of the activities of the Master Servicer
during the preceding year and of performance under this Agreement has been made
under such officers' supervision and (ii) to the best of such officers'
knowledge, based on such review, the Master Servicer has fulfilled all of its
obligations under this Agreement throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such


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default known to such officer and the nature and status thereof. Copies of any
such statement shall be provided by the Trustee to any Certificateholder and to
any Person identified to the Trustee as a prospective transferee of a
Certificate, upon the request and at the expense of the requesting party,
provided that such statement is delivered by the Master Servicer to the Trustee.

               SECTION 3.21.          Independent Public Accountants' Servicing
                                      Report.

               Not later than April 15 of each calendar year commencing in 2001,
the Master Servicer, at its expense, shall cause a nationally recognized firm of
independent certified public accountants to furnish to the Master Servicer a
report stating that (i) it has obtained a letter of representation regarding
certain matters from the management of the Master Servicer which includes an
assertion that the Master Servicer has complied with certain minimum residential
mortgage loan servicing standards, identified in the Uniform Single Attestation
Program for Mortgage Bankers established by the Mortgage Bankers Association of
America, with respect to the servicing of residential mortgage loans during the
most recently completed fiscal year and (ii) on the basis of an examination
conducted by such firm in accordance with standards established by the American
Institute of Certified Public Accountants, such representation is fairly stated
in all material respects, subject to such exceptions and other qualifications
that may be appropriate. In rendering its report such firm may rely, as to
matters relating to the direct servicing of residential mortgage loans by Sub-
Servicers, upon comparable reports of firms of independent certified public
accountants rendered on the basis of examinations conducted in accordance with
the same standards (rendered within one year of such report) with respect to
those Sub-Servicers. Immediately upon receipt of such report, the Master
Servicer shall furnish a copy of such report to the Trustee, the Trust
Administrator and the Rating Agencies. Copies of such statement shall be
provided by the Trustee to any Certificateholder upon request at the Master
Servicer's expense, provided that such statement is delivered by the Master
Servicer to the Trustee. In the event such firm of independent certified public
accountants requires the Trustee to agree to the procedures performed by such
firm, the Master Servicer shall direct the Trustee in writing to so agree; it
being understood and agreed that the Trustee will deliver such letter of
agreement in conclusive reliance upon the direction of the Master Servicer, and
the Trustee has not made any independent inquiry or investigation as to, and
shall have no obligation or liability in respect of, the sufficiency, validity
or correctness of such procedures.

               SECTION 3.22.          Access to Certain Documentation.

               The Master Servicer shall provide to the Office of the Controller
of the Currency, the Office of Thrift Supervision, the FDIC, and any other
federal or state banking or insurance regulatory authority that may exercise
authority over any Certificateholder, access to the documentation regarding the
Mortgage Loans required by applicable laws and regulations. Such access shall be
afforded without charge, but only upon reasonable request and during normal
business hours at the offices of the Master Servicer designated by it. In
addition, access to the documentation regarding the Mortgage Loans required by
applicable laws and regulations will be provided to such Certificateholder, the
Trustee, the Trust Administrator and to any Person identified to the Master
Servicer as a prospective transferee of a Certificate, upon reasonable request
during normal business hours at the offices of the Master Servicer designated by
it at the expense of the Person requesting such access.


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               SECTION 3.23.          Title, Management and Disposition of REO
                                      Property.

               (a) The deed or certificate of sale of any REO Property shall be
taken in the name of the Trustee, or its nominee, in trust for the benefit of
the Certificateholders. The Master Servicer, on behalf of the Trust Fund, shall
either sell any REO Property before the close of the third taxable year
following the year the Trust Fund acquires ownership of such REO Property for
purposes of Section 860G(a)(8) of the Code or request from the Internal Revenue
Service, no later than 60 days before the day on which the above three-year
grace period would otherwise expire, an extension of the above three-year grace
period, unless the Master Servicer shall have delivered to the Trustee, the
Trust Administrator and the Depositor an Opinion of Counsel, addressed to the
Trustee, the Trust Administrator and the Depositor, to the effect that the
holding by the Trust Fund of such REO Property subsequent to the close of the
third taxable year after its acquisition will not result in the imposition on
REMIC I of taxes on "prohibited transactions" thereof, as defined in Section
860F of the Code, or cause REMIC I to fail to qualify as a REMIC under Federal
law at any time that any Certificates are outstanding. The Master Servicer shall
manage, conserve, protect and operate each REO Property for the
Certificateholders solely for the purpose of its prompt disposition and sale in
a manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code or
result in the receipt by REMIC I of any "income from non-permitted assets"
within the meaning of Section 860F(a)(2)(B) of the Code, or any "net income from
foreclosure property" which is subject to taxation under the REMIC Provisions.

               (b) The Master Servicer shall segregate and hold all funds
collected and received in connection with the operation of any REO Property
separate and apart from its own funds and general assets and shall establish and
maintain with respect to REO Properties an account held in trust for the Trustee
for the benefit of the Certificateholders (the "REO Account"), which shall be an
Eligible Account. The Master Servicer shall be permitted to allow the Collection
Account to serve as the REO Account, subject to separate ledgers for each REO
Property. The Master Servicer shall be entitled to retain or withdraw any
interest income paid on funds deposited in the REO Account.

               (c) The Master 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 manner in which the Master Servicer manages and operates similar property
owned by the Master Servicer or any of its Affiliates, all on such terms and for
such period as the Master Servicer deems to be in the best interests of
Certificateholders. In connection therewith, the Master Servicer shall deposit,
or cause to be deposited in the clearing account (which account must be an
Eligible Account) in which it customarily deposits payments and collections on
mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than two Business Days after the Master
Servicer's receipt thereof, and shall thereafter deposit in the REO Account, in
no event more than one Business Day after the deposit of such funds into the
clearing account, all revenues received by it with respect to an REO Property
and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of such REO Property including, without limitation:



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

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

                     (iii) all costs and expenses necessary to maintain such REO
               Property.

               To the extent that amounts on deposit in the REO Account with
respect to an REO Property are insufficient for the purposes set forth in
clauses (i) through (iii) above with respect to such REO Property, the Master
Servicer shall advance from its own funds such amount as is necessary for such
purposes if, but only if, the Master Servicer would make such advances if the
Master Servicer owned the REO Property and if in the Master Servicer's judgment,
the payment of such amounts will be recoverable from the rental or sale of the
REO Property.

               Notwithstanding the foregoing, none of the Master Servicer, the
Trust Administrator or the Trustee shall:

                     (i) authorize the Trust Fund to enter into, renew or extend
               any New Lease with respect to any REO Property, if the New Lease
               by its terms will give rise to any income that does not
               constitute Rents from Real Property;

                    (ii) authorize any amount to be received or accrued under
               any New Lease other than amounts that will constitute Rents from
               Real Property;

                   (iii) authorize any construction on any REO Property, other
               than the completion of a building or other improvement thereon,
               and then only if more than ten percent of the construction of
               such building or other improvement was completed before default
               on the related Mortgage Loan became imminent, all within the
               meaning of Section 856(e)(4)(B) of the Code; or

                    (iv) authorize any Person to Directly Operate any REO
               Property on any date more than 90 days after its date of
               acquisition by the Trust Fund;

unless, in any such case, the Master Servicer has obtained an Opinion of
Counsel, provided to the Trust Administrator and the Trustee, to the effect that
such action will not cause such REO Property to fail to qualify as "foreclosure
property" within the meaning of Section 860G(a)(8) of the Code at any time that
it is held by the Trust Fund, in which case the Master Servicer may take such
actions as are specified in such Opinion of Counsel.

               The Master Servicer may contract with any Independent Contractor
for the operation and management of any REO Property, provided that:

                     (i) the terms and conditions of any such contract shall not
               be inconsistent herewith;



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                    (ii) any such contract shall require, or shall be
               administered to require, that the Independent Contractor pay all
               costs and expenses incurred in connection with the operation and
               management of such REO Property, including those listed above and
               remit all related revenues (net of such costs and expenses) to
               the Master Servicer as soon as practicable, but in no event later
               than thirty days following the receipt thereof by such
               Independent Contractor;

                   (iii) none of the provisions of this Section 3.23(c) relating
               to any such contract or to actions taken through any such
               Independent Contractor shall be deemed to relieve the Master
               Servicer of any of its duties and obligations to the Trustee on
               behalf of the Certificateholders with respect to the operation
               and management of any such REO Property; and

                    (iv) the Master Servicer shall be obligated with respect
               thereto to the same extent as if it alone were performing all
               duties and obligations in connection with the operation and
               management of such REO Property.

The Master Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of the Master Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify such indemnification. The Master Servicer shall be solely liable for
all fees owed by it to any such Independent Contractor, irrespective of whether
the Master Servicer's compensation pursuant to Section 3.18 is sufficient to pay
such fees.

               (d) In addition to the withdrawals permitted under Section
3.23(c), the Master Servicer may from time to time make withdrawals from the REO
Account for any REO Property: (i) to pay itself or any Sub-Servicer unpaid
Servicing Fees in respect of the related Mortgage Loan; and (ii) to reimburse
itself or any Sub-Servicer for unreimbursed Servicing Advances and P&I Advances
made in respect of such REO Property or the related Mortgage Loan. Any income
from the related REO Property received during any calendar months prior to a
Final Recovery Determination, net of any withdrawals made pursuant to Section
3.23(c) or this Section 3.23(d), shall be withdrawn by the Master Servicer from
each REO Account maintained by it and deposited into the Distribution Account in
accordance with Section 3.10(d)(ii) on the Master Servicer Remittance Date
relating to a Final Recovery Determination with respect to such Mortgage Loan,
for distribution on the related Distribution Date in accordance with Section
4.01.

               (e) Subject to the time constraints set forth in Section 3.23(a),
and further subject to obtaining the approval of the insurer under any related
Primary Mortgage Insurance Policy (if and to the extent that such approvals are
necessary to make claims under such policies in respect of the affected REO
Property), each REO Disposition shall be carried out by the Master Servicer at
such price and upon such terms and conditions as the Master Servicer shall deem
necessary or advisable, as shall be normal and usual in its general servicing
activities for similar properties.

               (f) The proceeds from the REO Disposition, net of any amount
required by law to be remitted to the Mortgagor under the related Mortgage Loan
and net of any payment or reimbursement to the Master Servicer or any
Sub-Servicer as provided above, shall be deposited in


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the Distribution Account in accordance with Section 3.10(d)(ii) on the Master
Servicer Remittance Date in the month following the receipt thereof for
distribution on the related Distribution Date in accordance with Section 4.01.
Any REO Disposition shall be for cash only (unless changes in the REMIC
Provisions made subsequent to the Startup Day allow a sale for other
consideration).

               (g) The Master Servicer shall file information returns with
respect to the receipt of mortgage interest received in a trade or business,
reports of foreclosures and abandonments of any Mortgaged Property and
cancellation of indebtedness income with respect to any Mortgaged Property as
required by Sections 6050H, 6050J and 6050P of the Code, respectively. Such
reports shall be in form and substance sufficient to meet the reporting
requirements imposed by such Sections 6050H, 6050J and 6050P of the Code.

               SECTION 3.24.          Obligations of the Master Servicer in
                                      Respect of Prepayment Interest Shortfalls.

               The Master Servicer shall deliver to the Trustee for deposit into
the Distribution Account on or before 3:00 p.m. New York time on the Master
Servicer Remittance Date from its own funds an amount equal to the lesser of (i)
the aggregate of the Prepayment Interest Shortfalls for the related Distribution
Date resulting from full or partial Principal Prepayments during the related
Prepayment Period and (ii) the amount of its aggregate Servicing Fee for the
most recently ended calendar month.

               SECTION 3.25.          Obligations of the Master Servicer in
                                      Respect of Monthly Payments.

               In the event that a shortfall in any collection on or liability
with respect to any Mortgage Loan results from or is attributable to adjustments
to Stated Principal Balances that were made by the Master Servicer in a manner
not consistent with the terms of the related Mortgage Note and this Agreement,
the Master Servicer, upon discovery or receipt of notice thereof, immediately
shall deliver to the Trustee for deposit in the Distribution Account from its
own funds the amount of any such shortfall and shall indemnify and hold harmless
the Trust Fund, the Trustee, the Trust Administrator, the Depositor and any
successor master servicer in respect of any such liability. Such indemnities
shall survive the termination or discharge of this Agreement.




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                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS

               SECTION 4.01.          Distributions.

               (a)(1) On each Distribution Date, the Trustee shall withdraw from
the Distribution Account, but only to the extent necessary to make the
distributions described in clauses (i) through (ix) below, the Available
Distribution Amount for such Distribution Date, less any amounts permitted to be
withdrawn from the Distribution Account pursuant to this Agreement, and shall
apply such amounts for the following purposes and in the following order of
priority, in each case to the extent of remaining available funds:

               (i) to distributions of interest in respect of the Class A
               Certificates, in an amount equal to the aggregate of the Interest
               Distribution Amounts in respect of such Certificates for such
               Distribution Date;

               (ii) to the extent of the Senior Principal Distribution Amount,
               to distributions of principal to the Class A Certificates
               (applied to reduce the Certificate Principal Balance of such
               Certificates), until the Certificate Principal Balance of such
               Class has been reduced to zero;

               (iii) to distributions of interest in respect of the Subordinate
               Certificates, in an amount (allocable among such Certificates PRO
               RATA in accordance with the respective amounts payable as to each
               pursuant to this clause (iii), in the order of priority from the
               Class of Subordinate Certificates with the lowest numerical
               designation to the Class of Subordinate Certificates with the
               highest numerical designation entitled to a distribution of
               interest pursuant to this clause (iii)) equal to the aggregate of
               the Interest Distribution Amounts in respect of such Certificates
               for such Distribution Date;

               (iv) to the Holders of the Classes of the Subordinate
               Certificates, an aggregate amount equal to the Subordinate
               Principal Distribution Amount for such Distribution Date (applied
               to reduce the Certificate Principal Balances of such
               Certificates), allocable among the Classes of Subordinate
               Certificates PRO RATA in accordance with the respective amounts
               payable as to each such Class pursuant to the priorities and
               amounts set forth in Section 4.01(b)(i);

               (v) to the Holders of the Certificates, to reimburse any
               Allocated Realized Loss Amounts in the following order of
               priority, in each case, to the extent of any Allocated Realized
               Loss Amount allocated to such Certificates and to the extent such
               Certificates are still outstanding: (i) to the Class A
               Certificates; (ii) to the Class B-1 Certificates; (iii) to the
               Class B-2 Certificates; (iv) to the Class B-3 Certificates; (v)
               to the Class B-4 Certificates; (vi) to the Class B-5
               Certificates; and (vii) to the Class B-6 Certificates; and



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               (vi) to the Holders of the Class R-I Certificates, any remaining
               amounts.

               (2) All references above to the Certificate Principal Balance of
        any Class of Certificates shall be to the Certificate Principal Balance
        of such Class prior to the allocation of Extraordinary Trust Fund
        Expenses and Realized Losses, in each case allocated to such Class of
        Certificates, on such Distribution Date pursuant to Section 4.04.

               (b)(i) On each Distribution Date, the aggregate distributions of
        principal made on such date in respect of the Subordinate Certificates
        pursuant to Section 4.01(a)(i)(iv) above shall be applied among the
        various Classes thereof, in the order of priority from the Class of
        Subordinate Certificates with the lowest numerical designation to the
        Class of Subordinate Certificates with the highest numerical
        designation, in each case to the extent of remaining available funds up
        to the amount allocable to such Class for such Distribution Date and in
        each case until the Certificate Principal Balance of each such Class is
        reduced to zero, in an amount with respect to each such Class equal to
        the sum of (X) the related Class B Percentage of the amounts described
        in clauses (i) through (v) of clause (a) of the definition of
        Subordinate Principal Distribution Amount, (Y) the portion of the
        amounts described in clauses (b) and (c) of the definition of
        Subordinate Principal Distribution Amount allocable to such Class
        pursuant to Section 4.01(b)(ii) below and (Z) the excess, if any, of the
        amount required to be distributed to such Class pursuant to this Section
        4.01(b)(i) for the immediately preceding Distribution Date, over the
        aggregate distributions of principal made in respect of such Class of
        Certificates on such immediately preceding Distribution Date pursuant to
        Section 4.01 to the extent that any such excess is not attributable to
        Realized Losses which were allocated to Subordinate Certificates with a
        lower priority pursuant to Section 4.04.

               (ii) On any Distribution Date, the portion of (a) all net
        Liquidation Proceeds and Insurance Proceeds with respect to any Mortgage
        Loans that were the subject of a Final Recovery Determination in the
        related Prepayment Period and (b) all Principal Prepayments received in
        respect of the Mortgage Loans in the related Prepayment Period,
        allocable to principal and not included in the Senior Principal
        Distribution Amount, will be allocated on a PRO RATA basis among the
        following Classes of Subordinate Certificates (each, an "Eligible
        Class") in proportion to the respective outstanding Certificate
        Principal Balances thereof: (i) the Class B-1 Certificates, (ii) the
        Class B-2 Certificates, if on such Distribution Date the aggregate
        percentage interest in the Trust Fund evidenced by the Class B-2
        Certificates, the Class B-3 Certificates, the Class B-4 Certificates,
        the Class B-5 Certificates and the Class B-6 Certificates equal or
        exceeds 2.000130439411% before giving effect to distributions on such
        Distribution Date, (iii) the Class B-3 Certificates, if on such
        Distribution Date the aggregate percentage interest in the Trust Fund
        evidenced by the Class B-3 Certificates, the Class B-4 Certificates, the
        Class B-5 Certificates and the Class B-6 Certificates equal or exceeds
        1.500190764590% before giving effect to distributions on such
        Distribution Date, (iv) the Class B-4 Certificates, if on such
        Distribution Date the aggregate percentage interest in the Trust Fund
        evidenced by the Class B-4 Certificates, the Class B-5 Certificates and
        the Class B-6 Certificates equal or exceeds 1.000045944231% before
        giving effect to distributions on such Distribution Date, (v) the Class
        B-5 Certificates, if on such Distribution Date the aggregate percentage
        interest in the Trust Fund evidenced by the Class B-5


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        Certificates and the Class B-6 Certificates equal or exceeds
        0.650067657302% before giving effect to distributions on such
        Distribution Date and (vi) the Class B-6 Certificates, if on such
        Distribution Date the percentage interest in the Trust Fund evidenced by
        the Class B-6 Certificates equals or exceeds 0.350144881517% before
        giving effect to distributions on such Distribution Date.
        Notwithstanding the foregoing, if the application of the foregoing on
        any Distribution Date as provided in Section 4.01 would result in a
        distribution in respect of principal to any Class or Classes of
        Subordinate Certificates in an amount greater than the remaining
        Certificate Principal Balance thereof (any such Class, a "Maturing
        Class") then: (a) the amount to be allocated to each Maturing Class
        shall be reduced to a level that, when applied as described above, would
        exactly reduce the Certificate Principal Balance of such Class to zero
        and (b) the total amount of the reductions pursuant to clause (a) above
        in the amount to be allocated to the Maturing Class or Classes shall be
        allocated among the remaining Eligible Classes on a PRO RATA basis in
        proportion to the respective outstanding Certificate Principal Balances
        thereof prior to the allocation thereto of any of the amounts described
        in the preceding sentence.

               (c) All distributions made with respect to each Class of
Certificates on each Distribution Date shall be allocated PRO RATA among the
outstanding Certificates in such Class based on their respective Percentage
Interests. Payments in respect of each Class of Certificates on each
Distribution Date will be made to the Holders of the respective Class of record
on the related Record Date (except as otherwise provided in Section 4.01(e) or
Section 9.01 respecting the final distribution on such Class), based on the
aggregate Percentage Interest represented by their respective Certificates, and
shall be made by wire transfer of immediately available funds to the account of
any such Holder at a bank or other entity having appropriate facilities
therefor, if such Holder shall have so notified the Trustee in writing at least
five Business Days prior to the Record Date immediately prior to such
Distribution Date and with respect to any Class of Certificates other than the
Residual Certificates is the registered owner of Certificates having an initial
aggregate Certificate Principal Balance that is in excess of the lesser of (i)
$5,000,000 or (ii) two-thirds of the initial Certificate Principal Balance of
such Class of Certificates, or otherwise by check mailed by first class mail to
the address of such Holder appearing in the Certificate Register. The final
distribution on each Certificate will be made in like manner, but only upon
presentment and surrender of such Certificate at the Corporate Trust Office or
such other location specified in the notice to Certificateholders of such final
distribution.

               Each distribution with respect to a Book-Entry Certificate shall
be paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the Trust
Administrator, the Depositor or the Master Servicer shall have any
responsibility therefor except as otherwise provided by this Agreement or
applicable law.

               (d) The rights of the Certificateholders to receive distributions
in respect of the Certificates, and all interests of the Certificateholders in
such distributions, shall be as set forth in


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this Agreement. None of the Holders of any Class of Certificates, the Trust
Administrator, the Trustee or the Master Servicer shall in any way be
responsible or liable to the Holders of any other Class of Certificates in
respect of amounts properly previously distributed on the Certificates.

               (e) Except as otherwise provided in Section 9.01, whenever the
Trustee expects that the final distribution with respect to any Class of
Certificates will be made on the next Distribution Date, the Trustee shall, no
later than five days after the related Determination Date, mail on such date to
each Holder of such Class of Certificates a notice to the effect that:

                     (i) the Trustee expects that the final distribution with
               respect to such Class of Certificates will be made on such
               Distribution Date, but only upon presentation and surrender of
               such Certificates at the office of the Trustee therein specified,
               and

                    (ii) no interest shall accrue on such Certificates from and
               after the end of the related Interest Accrual Period.

Any funds not distributed to any Holder or Holders of Certificates of such Class
on such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates shall, on such date, be set aside and held in trust by
the Trustee and credited to the account of the appropriate non- tendering Holder
or Holders. If any Certificates as to which notice has been given pursuant to
this Section 4.01(e) shall not have been surrendered for cancellation within six
months after the time specified in such notice, the Trustee shall mail a second
notice to the remaining non-tendering Certificateholders to surrender their
Certificates for cancellation in order to receive the final distribution with
respect thereto. If within one year after the second notice all such
Certificates shall not have been surrendered for cancellation, the Trustee
shall, directly or through an agent, mail a final notice to remaining
non-tendering Certificateholders concerning surrender of their Certificates and
shall continue to hold any remaining funds for the benefit of non-tendering
Certificateholders. The costs and expenses of maintaining the funds in trust and
of contacting such Certificateholders shall be paid out of the assets remaining
in such trust fund. If within one year after the final notice any such
Certificates shall not have been surrendered for cancellation, the Trustee shall
pay to Salomon Smith Barney Inc. all such amounts, and all rights of
non-tendering Certificateholders in or to such amounts shall thereupon cease. No
interest shall accrue or be payable to any Certificateholder on any amount held
in trust by the Trustee as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with this
Section 4.01(e).

               SECTION 4.02.          Statements to Certificateholders.

               On the Business Day prior to each Distribution Date, the Trust
Administrator shall prepare and forward by telecopy (or by such other means as
the Trust Administrator and the Trustee may agree from time to time) to the
Trustee and on each Distribution Date the Trustee shall forward by mail to each
Holder of the Regular Certificates, a statement as to the distributions made on
such Distribution Date setting forth:



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                     (i) the amount of the distribution made on such
               Distribution Date to the Holders of Certificates of each such
               Class allocable to principal;

                     (ii) the amount of the distribution made on such
               Distribution Date to the Holders of Certificates of each such
               Class allocable to interest;

                     (iii) the aggregate amount of servicing compensation
               received by the Master Servicer during the related Due Period and
               such other customary information as the Trust Administrator or
               the Trustee deems necessary or desirable, or which a
               Certificateholder reasonably requests, to enable
               Certificateholders to prepare their tax returns;

                     (iv) the aggregate amount of P&I Advances for such
               Distribution Date;

                     (v) the aggregate Stated Principal Balance of the Mortgage
               Loans and any REO Properties at the close of business on such
               Distribution Date;

                     (vi) the number, aggregate principal balance, weighted
               average remaining term to maturity and weighted average Mortgage
               Rate of the Mortgage Loans as of the related Due Date;

                     (vii) the number and aggregate unpaid principal balance of
               Mortgage Loans that are (a) delinquent 30 to 59 days, (b)
               delinquent 60 to 89 days, (c) delinquent 90 or more days in each
               case, as of the last day of the preceding calendar month, (d) as
               to which foreclosure proceedings have been commenced and (e) with
               respect to which the related Mortgagor has filed for protection
               under applicable bankruptcy laws, with respect to whom bankruptcy
               proceedings are pending or with respect to whom bankruptcy
               protection is in force;

                     (viii) with respect to any Mortgage Loan that became an REO
               Property during the preceding calendar month, the loan number of
               such Mortgage Loan, the unpaid principal balance and the Stated
               Principal Balance of such Mortgage Loan as of the date it became
               an REO Property;

                     (ix) the book value and the Stated Principal Balance of any
               REO Property as of the close of business on the last Business Day
               of the calendar month preceding the Distribution Date;

                     (x) the aggregate amount of Principal Prepayments made
               during the related Prepayment Period;

                     (xi) the aggregate amount of Realized Losses incurred
               during the related Prepayment Period (or, in the case of
               Bankruptcy Losses allocable to interest, during the related Due
               Period), separately identifying whether such Realized Losses
               constituted Fraud Losses, Special Hazard Losses or Bankruptcy
               Losses;



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                     (xii) the aggregate amount of Extraordinary Trust Fund
               Expenses withdrawn from the Collection Account or the
               Distribution Account for such Distribution Date;

                     (xiii) the aggregate Certificate Principal Balance of each
               such Class of Certificates, after giving effect to the
               distributions, and allocations of Realized Losses and
               Extraordinary Trust Fund Expenses, made on such Distribution
               Date, separately identifying any reduction thereof due to
               allocations of Realized Losses and Extraordinary Trust Fund
               Expenses;

                     (xiv) the Certificate Factor for each such Class of
               Certificates applicable to such Distribution Date;

                     (xv) the Interest Distribution Amount in respect of each
               such Class of Certificates for such Distribution Date (separately
               identifying any reductions in the case of Subordinate
               Certificates resulting from the allocation of Realized Losses
               allocable to interest and Extraordinary Trust Fund Expenses on
               such Distribution Date) and the respective portions thereof, if
               any, remaining unpaid following the distributions made in respect
               of such Certificates on such Distribution Date;

                     (xvi) the aggregate amount of any Prepayment Interest
               Shortfalls for such Distribution Date, to the extent not covered
               by payments by the Master Servicer pursuant to Section 3.24;

                     (xvii) the aggregate amount of Relief Act Interest
               Shortfalls for such Distribution Date;

                     (xviii) the then-applicable Bankruptcy Amount, Fraud Loss
               Amount, and Special Hazard Amount;

                     (xix) with respect to any Mortgage Loan as to which
               foreclosure proceedings have been concluded, the loan number and
               unpaid principal balance of such Mortgage Loan as of the date of
               such conclusion of foreclosure proceedings;

                     (xx) with respect to Mortgage Loans as to which a Final
               Liquidation has occurred, the number of Mortgage Loans, the
               unpaid principal balance of such Mortgage Loans as of the date of
               such Final Liquidation and the amount of proceeds (including
               Liquidation Proceeds and Insurance Proceeds) collected in respect
               of such Mortgage Loans; and

                     (xxi) any Allocated Realized Loss Amount with respect to
               each Class of Certificates for such Distribution Date.

               In the case of information furnished pursuant to subclauses (i)
through (iii) above, the amounts shall be expressed as a dollar amount per
Single Certificate of the relevant Class.



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<PAGE>



               Within a reasonable period of time after the end of each calendar
year, the Trust Administrator shall furnish to the Trustee, and the Trustee
shall forward to each Person who at any time during the calendar year was a
Holder of a Regular Certificate a statement containing the information set forth
in subclauses (i) through (iii) above, aggregated for such calendar year or
applicable portion thereof during which such person was a Certificateholder.
Such obligation of the Trust Administrator and the Trustee shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be provided by the Trustee pursuant to any requirements of the Code as
from time to time are in force.

               On each Distribution Date, the Trustee shall forward to the
Depositor, each Holder of a Residual Certificate and the Master Servicer, a copy
of the reports forwarded to the Regular Certificateholders on such Distribution
Date and a statement setting forth the amounts, if any, actually distributed
with respect to the Residual Certificates, respectively, on such Distribution
Date.

               Within a reasonable period of time after the end of each calendar
year, the Trust Administrator shall furnish to the Trustee and the Trustee shall
forward to each Person who at any time during the calendar year was a Holder of
a Residual Certificate a statement setting forth the amount, if any, actually
distributed with respect to the Residual Certificates, as appropriate,
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Trust Administrator
and the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be prepared by the Trustee and
furnished to such Holders pursuant to the rules and regulations of the Code as
are in force from time to time.

               Upon request, the Trust Administrator shall furnish to the
Trustee and the Trustee shall forward to each Certificateholder, during the term
of this Agreement, such periodic, special, or other reports or information,
whether or not provided for herein, as shall be reasonable with respect to the
Certificateholder, or otherwise with respect to the purposes of this Agreement,
all such reports or information to be provided at the expense of the
Certificateholder in accordance with such reasonable and explicit instructions
and directions as the Certificateholder may provide. For purposes of this
Section 4.02, the Trust Administrator's duties are limited to the extent that
the Trust Administrator receives timely reports as required from the Master
Servicer and the Trustee's duties are limited to the extent that the Trustee
receives timely reports as required from the Trust Administrator.

               On each Distribution Date, the Trust Administrator shall provide
Bloomberg Financial Markets, L.P. ("Bloomberg") cusip level factors for each
class of Certificates as of such Distribution Date, using a format and media
mutually acceptable to the Trust Administrator and Bloomberg.

               SECTION 4.03.          Remittance Reports; P&I Advances.

               (a) On the second Business Day prior to the related Distribution
Date, the Master Servicer shall deliver to the Trust Administrator and the
Trustee by telecopy (or by such other means as the Master Servicer, the Trust
Administrator and the Trustee may agree from time to time) a Remittance Report
with respect to the related Distribution Date. Such Remittance Report will


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include (i) the amount of P&I Advances to be made by the Master Servicer in
respect of the related Distribution Date, the aggregate amount of P&I Advances
outstanding after giving effect to such P&I Advances, and the aggregate amount
of Nonrecoverable P&I Advances in respect of such Distribution Date and (ii)
such other information with respect to the Mortgage Loans as the Trust
Administrator may reasonably require to perform the calculations necessary to
make the distributions contemplated by Section 4.01 and to prepare the
statements to Certificateholders contemplated by Section 4.02; provided,
however, that if the Master Servicer is not the Trust Administrator, the Master
Servicer will forward to the successor trust administrator the information set
forth in clause (i) above on the next Business Day following the related
Determination Date and the information set forth in clause (ii) above on the
fifth Business Day following the last day of the related calendar month. The
Trustee and the Trust Administrator shall not be responsible to recompute,
recalculate or verify any information provided to it by the Master Servicer.

               (b) The amount of P&I Advances to be made by the Master Servicer
for any Distribution Date shall equal, subject to Section 4.03(d), the sum of
(i) the aggregate amount of Monthly Payments (with each interest portion thereof
net of the related Servicing Fee), due on the related Due Date in respect of the
Mortgage Loans, which Monthly Payments were delinquent as of the close of
business on the related Determination Date and (ii) with respect to each REO
Property, which REO Property was acquired during or prior to the related
Prepayment Period and as to which such REO Property an REO Disposition did not
occur during the related Prepayment Period, an amount equal to the Monthly
Payments (with each interest portion thereof net of the related Servicing Fee)
that would have been due on the related Due Date in respect of the related
Mortgage Loans.

               On or before 3:00 p.m. New York time on the Master Servicer
Remittance Date, the Master Servicer shall remit in immediately available funds
to the Trustee for deposit in the Distribution Account an amount equal to the
aggregate amount of P&I Advances, if any, to be made in respect of the Mortgage
Loans and REO Properties for the related Distribution Date either (i) from its
own funds or (ii) from the Collection Account, to the extent of funds held
therein for future distribution (in which case, it will cause to be made an
appropriate entry in the records of Collection Account that amounts held for
future distribution have been, as permitted by this Section 4.03, used by the
Master Servicer in discharge of any such P&I Advance) or (iii) in the form of
any combination of (i) and (ii) aggregating the total amount of P&I Advances to
be made by the Master Servicer with respect to the Mortgage Loans and REO
Properties. Any amounts held for future distribution and so used shall be
appropriately reflected in the Master Servicer's records and replaced by the
Master Servicer by deposit in the Collection Account on or before any future
Master Servicer Remittance Date to the extent that the Available Distribution
Amount for the related Distribution Date (determined without regard to P&I
Advances to be made on the Master Servicer Remittance Date) shall be less than
the total amount that would be distributed to the Classes of Certificateholders
pursuant to Section 4.01 on such Distribution Date if such amounts held for
future distributions had not been so used to make P&I Advances. The Trustee will
provide notice to the Master Servicer by telecopy by the close of business on
the Master Servicer Remittance Date in the event that the amount remitted by the
Master Servicer to the Trustee on such Master Servicer Remittance Date is less
than the P&I Advances required to be made by the Master Servicer for the related
Distribution Date.



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               (c) The obligation of the Master Servicer to make such P&I
Advances is mandatory, notwithstanding any other provision of this Agreement but
subject to (d) below, and, with respect to any Mortgage Loan or REO Property,
shall continue until a Final Recovery Determination in connection therewith or
the removal thereof from REMIC I pursuant to any applicable provision of this
Agreement, except as otherwise provided in this Section.

               (d) Notwithstanding anything herein to the contrary, no P&I
Advance shall be required to be made hereunder by the Master Servicer if such
P&I Advance would, if made, constitute a Nonrecoverable P&I Advance. The
determination by the Master Servicer that it has made a Nonrecoverable P&I
Advance or that any proposed P&I Advance, if made, would constitute a
Nonrecoverable P&I Advance, shall be evidenced by an Officers' Certificate of
the Master Servicer delivered to the Depositor, the Trust Administrator and the
Trustee.

               SECTION 4.04.          Allocation of Extraordinary Trust Fund
                                      Expenses and Realized Losses.

               (a) Prior to each Distribution Date, the Master Servicer shall
determine as to each Mortgage Loan and REO Property: (i) the total amount of
Realized Losses, if any, incurred in connection with any Final Recovery
Determinations made during the related Prepayment Period; (ii) whether and the
extent to which such Realized Losses constituted Fraud Losses or Special Hazard
Losses; and (iii) the respective portions of such Realized Losses allocable to
interest and allocable to principal. Prior to each Distribution Date, the Master
Servicer shall also determine as to each Mortgage Loan: (A) the total amount of
Realized Losses, if any, incurred in connection with any Deficient Valuations
made during the related Prepayment Period; and (B) the total amount of Realized
Losses, if any, incurred in connection with Debt Service Reductions in respect
of Monthly Payments due during the related Due Period. The information described
in the two preceding sentences that is to be supplied by the Master Servicer
shall be evidenced by an Officers' Certificate delivered to the Trust
Administrator and the Trustee by the Master Servicer prior to the Determination
Date immediately following the end of (x) in the case of Bankruptcy Losses
allocable to interest, the Due Period during which any such Realized Loss was
incurred, and (y) in the case of all other Realized Losses, the Prepayment
Period during which any such Realized Loss was incurred.

               (b) All Realized Losses on the Mortgage Loans (other than Excess
Losses) shall be allocated by the Trust Administrator on each Distribution Date
as follows: first, to the Class B-6 Certificates; second, to the Class B-5
Certificates; third, to the Class B-4 Certificates; fourth, to the Class B-3
Certificates; fifth, to the Class B-2 Certificates; and sixth, to the Class B-1
Certificates, in each case until the Certificate Principal Balance thereof has
been reduced to zero. Thereafter, upon the reduction of the Certificate
Principal Balances of the Subordinate Certificates to zero, all Realized Losses
shall be allocated among the Senior Certificates on a PRO RATA basis. Any Excess
Losses attributable to any Mortgage Loan shall be allocated among all the
Certificates on a PRO RATA basis. Any allocation of a Realized Loss to a
Certificate will be made by reducing the Certificate Principal Balance thereof
by the amount so allocated as of the Distribution Date in the month following
the calendar month in which such Realized Loss was incurred.



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               Extraordinary Trust Fund Expenses shall be allocated by the Trust
Administrator on each Distribution Date as follows: first, to the Class B-6
Certificates; second, to the Class B-5 Certificates; third, to the Class B-4
Certificates; fourth, to the Class B-3 Certificates; fifth, to the Class B-2
Certificates; and sixth, to the Class B-1 Certificates, in each case until the
Certificate Principal Balance thereof has been reduced to zero. Thereafter, upon
the reduction of the Certificate Principal Balances of the Subordinate
Certificates to zero, such Extraordinary Trust Fund Expenses shall be allocated
among the Senior Certificates on a PRO RATA basis.

               Notwithstanding the method of allocation of Realized Losses and
Extraordinary Trust Fund Expenses above, if any Overcollateralization exists
when Realized Losses or Extraordinary Trust Fund Expenses are to be allocated,
such Realized Losses or Extraordinary Trust Fund Expenses will be allocated
first to the Overcollateralization, until the Overcollateralization is reduced
to zero, prior to allocating such Realized Losses or Extraordinary Trust Fund
Expenses to the Certificates in accordance with the priorities set forth above.

               As used herein, an allocation of a Realized Loss or Extraordinary
Trust Fund Expense on a "PRO RATA basis" among two or more specified Classes of
Certificates means an allocation on a PRO RATA basis, among the various Classes
so specified, to each such Class of Certificates on the basis of their then
outstanding Certificate Principal Balances prior to giving effect to
distributions to be made on such Distribution Date. All Realized Losses and all
other losses allocated to a Class of Certificates hereunder will be allocated
among the Certificates of such Class in proportion to the Percentage Interests
evidenced thereby.

               (c) Notwithstanding anything to the contrary herein, in no event
shall the Certificate Principal Balance of a Class A Certificate be reduced more
than once in respect of any particular amount both (i) allocable to such
Certificate in respect of Realized Losses or Extraordinary Trust Fund Expenses
pursuant to Section 4.04 and (ii) payable to the Holder of such Certificate
pursuant to Section 4.01(a) as a portion of the Senior Principal Distribution
Amount.

               SECTION 4.05.          Compliance with Withholding Requirements.

               Notwithstanding any other provision of this Agreement, the Trust
Administrator shall comply with all federal withholding requirements respecting
payments to Certificateholders of interest or original issue discount that the
Trust Administrator reasonably believes are applicable under the Code. The
consent of Certificateholders shall not be required for such withholding. In the
event the Trust Administrator does withhold any amount from interest or original
issue discount payments or advances thereof to any Certificateholder pursuant to
federal withholding requirements, the Trust Administrator shall indicate the
amount withheld to such Certificateholders.

               SECTION 4.06.          Reserved.



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               SECTION 4.07.          Commission Reporting.

               Within 15 days after each Distribution Date, the Trust
Administrator shall file with the Commission via the Electronic Data Gathering
and Retrieval System, a Form 8-K with a copy of the statement to
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
January 30, 2002, the Trust Administrator shall file a Form 15 Suspension
Notification with respect to the Trust Fund, if applicable. Prior to March 30,
2002, the Trust Administrator shall file a Form 10-K, substantially in the form
attached hereto as Exhibit I, with respect to the Trust Fund. The Depositor
hereby grants to the Trust Administrator a limited power of attorney to execute
and file each such document on behalf of the Depositor. Such power of attorney
shall continue until the earlier of (i) receipt by the Trust Administrator from
the Depositor of written termination of such power of attorney and (ii) the
termination of the Trust Fund. At least three Business Days prior to filing any
Form 8-K or Form 10-K pursuant to this Section 4.07, the Trust Administrator
shall deliver a copy of such Form 8-K or Form 10-K, as the case may be, to the
Depositor. The Depositor agrees to promptly furnish to the Trust Administrator,
from time to time upon request, such further information, reports and financial
statements within its control related to this Agreement and the Mortgage Loans
as the Trust Administrator reasonably deems appropriate to prepare and file all
necessary reports with the Commission.


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                                    ARTICLE V

                                THE CERTIFICATES

               SECTION 5.01.          The Certificates.

               (a) The Certificates in the aggregate will represent the entire
beneficial ownership interest in the Mortgage Loans and all other assets
included in REMIC I. At the Closing Date, the aggregate Certificate Principal
Balance of the Certificates will equal the aggregate Stated Principal Balance of
the Mortgage Loans.

               The Certificates will be substantially in the forms annexed
hereto as Exhibits A-1 through A-8. The Certificates of each Class will be
issuable in registered form only, in denominations of authorized Percentage
Interests as described in the definition thereof. Each Certificate will share
ratably in all rights of the related Class.

               Upon original issue, the Certificates shall be executed,
authenticated and delivered by the Trustee to or upon the order of the
Depositor. The Certificates shall be executed and attested by manual or
facsimile signature on behalf of the Trustee by an authorized signatory.
Certificates bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Trustee shall bind the Trustee,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates. No Certificate shall be
entitled to any benefit under this Agreement or be valid for any purpose, unless
there appears on such Certificate a certificate of authentication substantially
in the form provided herein executed by the Trustee by manual signature, and
such certificate of authentication shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.

               (b) The Class A Certificates, the Class B-1 Certificates, the
Class B-2 Certificates and the Class B-3 Certificates shall initially be issued
as one or more Certificates held by the Book- Entry Custodian or, if appointed
to hold such Certificates as provided below, the Depository and registered in
the name of the Depository or its nominee and, except as provided below,
registration of such Certificates may not be transferred by the Trustee except
to another Depository that agrees to hold such Certificates for the respective
Certificate Owners with Ownership Interests therein. The Certificate Owners
shall hold their respective Ownership Interests in and to such Certificates
through the book-entry facilities of the Depository and, except as provided
below, shall not be entitled to definitive, fully registered Certificates
("Definitive Certificates") in respect of such Ownership Interests. All
transfers by Certificate Owners of their respective Ownership Interests in the
Book- Entry Certificates shall be made in accordance with the procedures
established by the Depository Participant or brokerage firm representing such
Certificate Owner. Each Depository Participant shall only transfer the Ownership
Interests in the Book-Entry Certificates of Certificate Owners it represents or
of brokerage firms for which it acts as agent in accordance with the
Depository's normal procedures. The Trustee is hereby initially appointed as the
Book-Entry Custodian and hereby agrees to act as such in accordance herewith and
in accordance with the agreement that it has with the Depository authorizing it
to act as such. The Book-Entry Custodian may, and if it is no


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longer qualified to act as such, the Book-Entry Custodian shall, appoint, by a
written instrument delivered to the Depositor, the Master Servicer, the Trust
Administrator, the Trustee (if the Trustee is not the Book-Entry Custodian) and
any other transfer agent (including the Depository or any successor Depository)
to act as Book-Entry Custodian under such conditions as the predecessor
Book-Entry Custodian and the Depository or any successor Depository may
prescribe, provided that the predecessor Book-Entry Custodian shall not be
relieved of any of its duties or responsibilities by reason of any such
appointment of other than the Depository. If the Trustee resigns or is removed
in accordance with the terms hereof, the successor trustee or, if it so elects,
the Depository shall immediately succeed to its predecessor's duties as
Book-Entry Custodian. The Depositor shall have the right to inspect, and to
obtain copies of, any Certificates held as Book-Entry Certificates by the
Book-Entry Custodian.

               The Trustee, the Trust Administrator, the Master Servicer and the
Depositor may for all purposes (including the making of payments due on the
Book-Entry Certificates) deal with the Depository as the authorized
representative of the Certificate Owners with respect to the Book-Entry
Certificates for the purposes of exercising the rights of Certificateholders
hereunder. The rights of Certificate Owners with respect to the Book-Entry
Certificates shall be limited to those established by law and agreements between
such Certificate Owners and the Depository Participants and brokerage firms
representing such Certificate Owners. Multiple requests and directions from, and
votes of, the Depository as Holder of the Book-Entry Certificates with respect
to any particular matter shall not be deemed inconsistent if they are made with
respect to different Certificate Owners. The Trustee may establish a reasonable
record date in connection with solicitations of consents from or voting by
Certificateholders and shall give notice to the Depository of such record date.

               If (i)(A) the Depositor advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (B) the Depositor is unable to locate a
qualified successor, (ii) the Depositor at its option advises the Trustee in
writing that it elects to terminate the book-entry system through the Depository
or (iii) after the occurrence of a Master Servicer Event of Default, Certificate
Owners representing in the aggregate not less than 51% of the Ownership
Interests of the Book-Entry Certificates advise the Trustee through the
Depository, in writing, that the continuation of a book-entry system through the
Depository is no longer in the best interests of the Certificate Owners, the
Trustee shall notify all Certificate Owners, through the Depository, of the
occurrence of any such event and of the availability of Definitive Certificates
to Certificate Owners requesting the same. Upon surrender to the Trustee of the
Book- Entry Certificates by the Book-Entry Custodian or the Depository, as
applicable, accompanied by registration instructions from the Depository for
registration of transfer, the Trustee shall issue the Definitive Certificates.
Such Definitive Certificates will be issued in minimum denominations of
$100,000, except that any beneficial ownership that was represented by a
Book-Entry Certificate in an amount less than $100,000 immediately prior to the
issuance of a Definitive Certificate shall be issued in a minimum denomination
equal to the amount represented by such Book-Entry Certificate. None of the
Depositor, the Master Servicer, the Trust Administrator nor the Trustee shall be
liable for any delay in the delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Certificates all references herein to obligations imposed
upon or to be performed by the Depository shall be deemed to be imposed upon and
performed by the Trustee, to the extent applicable with respect to such
Definitive


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Certificates, and the Trustee shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.

               SECTION 5.02.          Registration of Transfer and Exchange of
                                      Certificates.

               (a) The Trustee shall cause to be kept at one of the offices or
agencies to be appointed by the Trustee in accordance with the provisions of
Section 8.12 a Certificate Register for the Certificates in which, subject to
such reasonable regulations as it may prescribe, the Trustee shall provide for
the registration of Certificates and of transfers and exchanges of Certificates
as herein provided.

               (b) No transfer of any Class B-4 Certificate, Class B-5
Certificate, Class B-6 Certificate or Residual Certificate (the "Private
Certificates") shall be made unless that transfer is made pursuant to an
effective registration statement under the Securities Act of 1933, as amended
(the "1933 Act"), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer of
a Private Certificate is to be made without registration or qualification (other
than in connection with the initial transfer of any such Certificate by the
Depositor to an affiliate of the Depositor), the Trustee shall require, receipt
of: (i) if such transfer is purportedly being made in reliance upon Rule 144A
under the 1933 Act, written certifications from the Certificateholder desiring
to effect the transfer and from such Certificateholder's prospective transferee,
substantially in the forms attached hereto as Exhibit F-1; and (ii) in all other
cases, an Opinion of Counsel satisfactory to it that such transfer may be made
without such registration or qualification (which Opinion of Counsel shall not
be an expense of the Depositor, the Trustee, the Trust Administrator, the Master
Servicer, in its capacity as such, or the Trust Fund), together with copies of
the written certification(s) of the Certificateholder desiring to effect the
transfer and/or such Certificateholder's prospective transferee upon which such
Opinion of Counsel is based, if any. Neither the Depositor nor the Trustee is
obligated to register or qualify the Private Certificates under the 1933 Act or
any other securities laws or to take any action not otherwise required under
this Agreement to permit the transfer of such Certificates without registration
or qualification. Any Certificateholder desiring to effect the transfer of a
Private Certificate shall, and does hereby agree to, indemnify the Trustee, the
Trust Administrator, the Depositor and the Master Servicer against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.

               (c) No transfer of a Private Certificate or any interest therein
shall be made to any Plan subject to ERISA or Section 4975 of the Code, any
Person acting, directly or indirectly, on behalf of any such Plan or any Person
acquiring such Certificates with "Plan Assets" of a Plan within the meaning of
the DOL Regulations ("Plan Assets") unless the Depositor, the Trustee, the Trust
Administrator and the Master Servicer are provided with an Opinion of Counsel
which establishes to the satisfaction of the Depositor, the Trustee, the Trust
Administrator and the Master Servicer that the purchase of such Certificates is
permissible under applicable law, will not constitute or result in any
prohibited transaction under ERISA or Section 4975 of the Code and will not
subject the Depositor, the Master Servicer, the Trustee, the Trust Administrator
or the Trust Fund to any obligation or liability (including obligations or
liabilities under ERISA or Section 4975 of the Code) in addition to those
undertaken in this Agreement, which Opinion of Counsel shall not be an expense
of the Depositor, the Master Servicer, the Trustee, the Trust Administrator or
the Trust Fund. In lieu


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of such Opinion of Counsel, any prospective Transferee of such Certificates may
provide a certification in the form of Exhibit G to this Agreement (or other
form acceptable to the Depositor, the Trustee, the Trust Administrator and the
Master Servicer), which the Trustee may rely upon without further inquiry or
investigation. An Opinion of Counsel, any certification or a deemed
representation will not be required in connection with the initial transfer of
any such Certificate by the Depositor to an affiliate of the Depositor (in which
case, the Depositor or any affiliate thereof shall have deemed to have
represented that such affiliate is not a Plan or a Person investing Plan Assets)
and the Trustee shall be entitled to conclusively rely upon a representation
(which, upon the request of the Trustee, shall be a written representation) from
the Depositor of the status of such transferee as an affiliate of the Depositor.

        If any Subordinate Certificate or Residual Certificate or any interest
therein is acquired or held in violation of the provisions of the preceding
paragraph, the next preceding permitted beneficial owner will be treated as the
beneficial owner of that Certificate retroactive to the date of transfer to the
purported beneficial owner. Any purported beneficial owner whose acquisition or
holding of any such Certificate or interest therein was effected in violation of
the provisions of the preceding paragraph shall indemnify and hold harmless the
Depositor, the Master Servicer, the Trustee, the Trust Administrator and the
Trust Fund from and against any and all liabilities, claims, costs or expenses
incurred by those parties as a result of that acquisition or holding.

               (d) (i) Each Person who has or who acquires any Ownership
Interest in a Residual Certificate shall be deemed by the acceptance or
acquisition of such Ownership Interest to have agreed to be bound by the
following provisions and to have irrevocably authorized the Trustee or its
designee under clause (iii)(A) below to deliver payments to a Person other than
such Person and to negotiate the terms of any mandatory sale under clause
(iii)(B) below and to execute all instruments of Transfer and to do all other
things necessary in connection with any such sale. The rights of each Person
acquiring any Ownership Interest in a Residual Certificate are expressly subject
to the following provisions:

                              (A) Each Person holding or acquiring any Ownership
                       Interest in a Residual Certificate shall be a Permitted
                       Transferee and shall promptly notify the Trustee of any
                       change or impending change in its status as a Permitted
                       Transferee.

                              (B) In connection with any proposed Transfer of
                       any Ownership Interest in a Residual Certificate, the
                       Trustee shall require delivery to it and shall not
                       register the Transfer of any Residual Certificate until
                       its receipt of an affidavit and agreement (a "Transfer
                       Affidavit and Agreement"), in the form attached hereto as
                       Exhibit F-2, from the proposed Transferee, in form and
                       substance satisfactory to the Trustee, representing and
                       warranting, among other things, that such Transferee is a
                       Permitted Transferee, that it is not acquiring its
                       Ownership Interest in the Residual Certificate that is
                       the subject of the proposed Transfer as a nominee,
                       trustee or agent for any Person that is not a Permitted
                       Transferee, that for so long as it retains its Ownership
                       Interest in a Residual Certificate, it will endeavor to
                       remain a Permitted Transferee,


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<PAGE>



                       and that it has reviewed the provisions of this Section
                       5.02(d) and agrees to be bound by them.

                              (C) Notwithstanding the delivery of a Transfer
                       Affidavit and Agreement by a proposed Transferee under
                       clause (B) above, if a Responsible Officer of the Trustee
                       who is assigned to this transaction has actual knowledge
                       that the proposed Transferee is not a Permitted
                       Transferee, no Transfer of an Ownership Interest in a
                       Residual Certificate to such proposed Transferee shall be
                       effected.

                              (D) Each Person holding or acquiring any Ownership
                       Interest in a Residual Certificate shall agree (x) to
                       require a Transfer Affidavit and Agreement from any other
                       Person to whom such Person attempts to transfer its
                       Ownership Interest in a Residual Certificate and (y) not
                       to transfer its Ownership Interest unless it provides a
                       transferor affidavit (a "Transferor Affidavit"), in the
                       form attached hereto as Exhibit F-2, to the Trustee
                       stating that, among other things, it has no actual
                       knowledge that such other Person is not a Permitted
                       Transferee.

                              (E) Each Person holding or acquiring an Ownership
                       Interest in a Residual Certificate, by purchasing an
                       Ownership Interest in such Certificate, agrees to give
                       the Trustee written notice that it is a "pass-through
                       interest holder" within the meaning of temporary Treasury
                       regulation Section 1.67- 3T(a)(2)(i)(A) immediately upon
                       acquiring an Ownership Interest in a Residual
                       Certificate, if it is, or is holding an Ownership
                       Interest in a Residual Certificate on behalf of, a
                       "pass-through interest holder."

                    (ii) The Trustee will register the Transfer of any Residual
               Certificate only if it shall have received the Transfer Affidavit
               and Agreement and all of such other documents as shall have been
               reasonably required by the Trustee as a condition to such
               registration. In addition, no Transfer of a Residual Certificate
               shall be made unless the Trustee shall have received a
               representation letter from the Transferee of such Certificate to
               the effect that such Transferee is a Permitted Transferee.

                   (iii) (A) If any purported Transferee shall become a Holder
               of a Residual Certificate in violation of the provisions of this
               Section 5.02(d), then the last preceding Permitted Transferee
               shall be restored, to the extent permitted by law, to all rights
               as holder thereof retroactive to the date of registration of such
               Transfer of such Residual Certificate. The Trustee shall be under
               no liability to any Person for any registration of Transfer of a
               Residual Certificate that is in fact not permitted by this
               Section 5.02(d) or for making any payments due on such
               Certificate to the holder thereof or for taking any other action
               with respect to such holder under the provisions of this
               Agreement.

                              (B) If any purported Transferee shall become a
               holder of a Residual Certificate in violation of the restrictions
               in this Section 5.02(d) and to the


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               extent that the retroactive restoration of the rights of the
               holder of such Residual Certificate as described in clause
               (iii)(A) above shall be invalid, illegal or unenforceable, then
               the Trustee shall have the right, without notice to the holder or
               any prior holder of such Residual Certificate, to sell such
               Residual Certificate to a purchaser selected by the Trustee on
               such terms as the Trustee may choose. Such purported Transferee
               shall promptly endorse and deliver each Residual Certificate in
               accordance with the instructions of the Trustee. Such purchaser
               may be the Trustee itself or any Affiliate of the Trustee. The
               proceeds of such sale, net of the commissions (which may include
               commissions payable to the Trustee or its Affiliates), expenses
               and taxes due, if any, will be remitted by the Trustee to such
               purported Transferee. The terms and conditions of any sale under
               this clause (iii)(B) shall be determined in the sole discretion
               of the Trustee, and the Trustee shall not be liable to any Person
               having an Ownership Interest in a Residual Certificate as a
               result of its exercise of such discretion.

                    (iv) The Trust Administrator and the Trustee shall make
               available to the Internal Revenue Service and those Persons
               specified by the REMIC Provisions all information necessary to
               compute any tax imposed (A) as a result of the Transfer of an
               Ownership Interest in a Residual Certificate to any Person who is
               a Disqualified Organization, including the information described
               in Treasury regulations sections 1.860D-1(b)(5) and
               1.860E-2(a)(5) with respect to the "excess inclusions" of such
               Residual Certificate and (B) as a result of any regulated
               investment company, real estate investment trust, common trust
               fund, partnership, trust, estate or organization described in
               Section 1381 of the Code that holds an Ownership Interest in a
               Residual Certificate having as among its record holders at any
               time any Person which is a Disqualified Organization. Reasonable
               compensation for providing such information may be accepted by
               the Trust Administrator and the Trustee.

                     (v) The provisions of this Section 5.02(d) set forth prior
               to this subsection (v) may be modified, added to or eliminated,
               provided that there shall have been delivered to the Trustee at
               the expense of the party seeking to modify, add to or eliminate
               any such provision the following:

                              (A) written notification from the Rating Agencies
                       to the effect that the modification, addition to or
                       elimination of such provisions will not cause the Rating
                       Agencies to downgrade its then-current ratings of any
                       Class of Certificates; and

                              (B) an Opinion of Counsel, in form and substance
                       satisfactory to the Trustee, to the effect that such
                       modification of, addition to or elimination of such
                       provisions will not cause either REMIC I to cease to
                       qualify as a REMIC and will not cause (x) REMIC I to be
                       subject to an entity-level tax caused by the Transfer of
                       any Residual Certificate to a Person that is not a
                       Permitted Transferee or (y) a Person other than the
                       prospective transferee to be subject to a REMIC-tax
                       caused by the Transfer of a Residual Certificate to a
                       Person that is not a Permitted Transferee.


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               (e) Subject to the preceding subsections, upon surrender for
registration of transfer of any Certificate at any office or agency of the
Trustee maintained for such purpose pursuant to Section 8.12, the Trustee shall
execute, authenticate and deliver, in the name of the designated Transferee or
Transferees, one or more new Certificates of the same Class of a like aggregate
Percentage Interest.

               (f) At the option of the Holder thereof, any Certificate may be
exchanged for other Certificates of the same Class with authorized denominations
and a like aggregate Percentage Interest, upon surrender of such Certificate to
be exchanged at any office or agency of the Trustee maintained for such purpose
pursuant to Section 8.12. Whenever any Certificates are so surrendered for
exchange the Trustee shall execute, authenticate and deliver the Certificates
which the Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for transfer or exchange shall (if so
required by the Trustee) be duly endorsed by, or be accompanied by a written
instrument of transfer in the form satisfactory to the Trustee duly executed by,
the Holder thereof or his attorney duly authorized in writing.

               (g) No service charge to the Certificateholders shall be made for
any transfer or exchange of Certificates, but the Trustee may require payment of
a sum sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

               (h) All Certificates surrendered for transfer and exchange shall
be canceled and destroyed by the Trustee in accordance with its customary
procedures.

               SECTION 5.03.          Mutilated, Destroyed, Lost or Stolen
                                      Certificates.

               If (i) any mutilated Certificate is surrendered to the Trustee,
or the Trustee receive evidence to its satisfaction of the destruction, loss or
theft of any Certificate, and (ii) there is delivered to the Trustee such
security or indemnity as may be required by them to save each of them harmless,
then, in the absence of actual knowledge by the Trustee that such Certificate
has been acquired by a bona fide purchaser, the Trustee shall execute and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Certificate, a new Certificate of the same Class and of like denomination
and Percentage Interest. Upon the issuance of any new Certificate under this
Section, the Trustee may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee) connected
therewith. Any replacement Certificate issued pursuant to this Section shall
constitute complete and indefeasible evidence of ownership in the applicable
REMIC created hereunder, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time.

               SECTION 5.04.          Persons Deemed Owners.

               The Depositor, the Master Servicer, the Trustee, the Trust
Administrator and any agent of any of them may treat the Person in whose name
any Certificate is registered as the owner of such Certificate for the purpose
of receiving distributions pursuant to Section 4.01 and for all


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other purposes whatsoever, and none of the Depositor, the Master Servicer, the
Trustee, the Trust Administrator or any agent of any of them shall be affected
by notice to the contrary.

               SECTION 5.05.          Certain Available Information.

               On or prior to the date of the first sale of any Private
Certificate to an Independent third party, the Depositor shall provide to the
Trustee ten copies of any private placement memorandum or other disclosure
document used by the Depositor in connection with the offer and sale of the
Private Certificates. In addition, if any such private placement memorandum or
disclosure document is revised, amended or supplemented at any time following
the delivery thereof to the Trustee, the Depositor promptly shall inform the
Trustee of such event and shall deliver to the Trustee ten copies of the private
placement memorandum or disclosure document, as revised, amended or
supplemented. The Trustee shall maintain at its Corporate Trust Office and shall
make available free of charge during normal business hours for review by any
Holder of a Certificate or any Person identified to the Trustee as a prospective
transferee of a Certificate, originals or copies of the following items: (i) in
the case of a Holder or prospective transferee of a Private Certificate, the
private placement memorandum or other disclosure document relating to such
Certificates in the form most recently provided to the Trustee; and (ii) in all
cases, (A) this Agreement and any amendments hereof entered into pursuant to
Section 11.01, (B) all monthly statements required to be delivered to
Certificateholders of the relevant Class pursuant to Section 4.02 since the
Closing Date, and all other notices, reports, statements and written
communications delivered to the Certificateholders of the relevant Class
pursuant to this Agreement since the Closing Date, (C) all certifications
delivered by a Responsible Officer of the Trust Administrator since the Closing
Date pursuant to Section 10.01(h), (D) any and all Officers' Certificates
delivered to the Trustee by the Master Servicer since the Closing Date to
evidence the Master Servicer's determination that any P&I Advance was, or if
made, would be a Nonrecoverable P&I Advance and (E) any and all Officers'
Certificates delivered to the Trustee by the Master Servicer since the Closing
Date pursuant to Section 4.04(a). Copies and mailing of any and all of the
foregoing items will be available from the Trustee upon request at the expense
of the person requesting the same.


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                                   ARTICLE VI

                      THE DEPOSITOR AND THE MASTER SERVICER

               SECTION 6.01.          Liability of the Depositor and the Master
                                      Servicer.

               The Depositor and the Master Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
by this Agreement and undertaken hereunder by the Depositor and the Master
Servicer herein.

               SECTION 6.02.          Merger or Consolidation of the Depositor
                                      or the Master Servicer.

               Subject to the following paragraph, the Depositor will keep in
full effect its existence, rights and franchises as a corporation under the laws
of the jurisdiction of its incorporation. Subject to the following paragraph,
the Master Servicer will keep in full effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation and its qualification as an approved conventional seller/servicer
for Fannie Mae or Freddie Mac in good standing. The Depositor and the Master
Servicer each 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, the
Certificates or any of the Mortgage Loans and to perform its respective duties
under this Agreement.

               The Depositor or the Master Servicer may be merged or
consolidated with or into any Person, or transfer all or substantially all of
its assets to any Person, in which case any Person resulting from any merger or
consolidation to which the Depositor or the Master Servicer shall be a party, or
any Person succeeding to the business of the Depositor or the Master Servicer,
shall be the successor of the Depositor or the Master Servicer, as the case may
be, 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; provided, however, that the successor or surviving Person to
the Master Servicer shall be qualified to service mortgage loans on behalf of
Fannie Mae or Freddie Mac; and provided further that the Rating Agencies'
ratings of the Senior Certificates, the Class B-1 Certificates, the Class B-2
Certificates and the Class B-3 Certificates in effect immediately prior to such
merger or consolidation will not be qualified, reduced or withdrawn as a result
thereof (as evidenced by a letter to such effect from the Rating Agencies).

               SECTION 6.03.          Limitation on Liability of the Depositor,
                                      the Master Servicer and Others.

               None of the Depositor, the Master Servicer or any of the
directors, officers, employees or agents of the Depositor or the Master Servicer
shall be under any liability to the Trust Fund or the Certificateholders 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 Depositor, the Master Servicer or any such
person against any breach of warranties, representations or covenants made
herein, or against any specific liability imposed on the Master Servicer
pursuant hereto, or against any liability which would otherwise be imposed by
reason of


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willful misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The Depositor,
the Master Servicer and any director, officer, employee or agent of the
Depositor or the Master Servicer may rely in good faith on any document of any
kind which, PRIMA FACIE, is properly executed and submitted by any Person
respecting any matters arising hereunder. The Depositor, the Master Servicer and
any director, officer, employee or agent of the Depositor or the Master Servicer
shall be indemnified and held harmless by the Trust Fund against any loss,
liability or expense incurred in connection with any legal action relating to
this Agreement or the Certificates, other than any loss, liability or expense to
any specific Mortgage Loan or Mortgage Loans (except as any such loss, liability
or expense shall be otherwise reimbursable pursuant to this Agreement) or any
loss, liability or expense incurred by reason of willful misfeasance, bad faith
or negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder. Neither the Depositor nor the
Master Servicer shall be under any obligation to appear in, prosecute or defend
any legal action unless such action is related to its respective duties under
this Agreement and, in its opinion, does not involve it in any expense or
liability; provided, however, that each of the Depositor and the Master Servicer
may in its discretion undertake any such action which it may deem necessary or
desirable with respect to this Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. In such
event, unless the Depositor or the Master Servicer acts without the consent of
Holders of Certificates entitled to at least 51% of the Voting Rights (which
consent shall not be necessary in the case of litigation or other legal action
by either to enforce their respective rights or defend themselves hereunder),
the legal expenses and costs of such action and any liability resulting
therefrom (except any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of duties hereunder or
by reason of reckless disregard of obligations and duties hereunder) shall be
expenses, costs and liabilities of the Trust Fund, and the Depositor (subject to
the limitations set forth above) and the Master Servicer shall be entitled to be
reimbursed therefor from the Collection Account as and to the extent provided in
Section 3.11, any such right of reimbursement being prior to the rights of the
Certificateholders to receive any amount in the Collection Account.

               SECTION 6.04.          Limitation on Resignation of the Master
                                      Servicer.

               The Master Servicer shall not resign from the obligations and
duties hereby imposed on it except (i) upon determination that its duties
hereunder are no longer permissible under applicable law or (ii) with the
written consent of the Trustee, which consent may not be unreasonably withheld,
with written confirmation from the Rating Agencies (which confirmation shall be
furnished to the Depositor, the Trustee and the Trust Administrator) that such
resignation will not cause the Rating Agencies to reduce the then current rating
of the Class A Certificates and provided that a qualified successor has agreed
to assume the duties and obligations of the Master Servicer hereunder. Any such
determination pursuant to clause (i) of the preceding sentence permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of Counsel
to such effect obtained at the expense of the Master Servicer and delivered to
the Trustee and the Trust Administrator. No resignation of the Master Servicer
shall become effective until the Trustee or a successor servicer shall have
assumed the Master Servicer's responsibilities, duties, liabilities (other than
those liabilities arising prior to the appointment of such successor) and
obligations under this Agreement.



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               Except as expressly provided herein, the Master Servicer shall
not assign nor transfer any of its rights, benefits or privileges hereunder to
any other Person, nor delegate to or subcontract with, nor authorize or appoint
any other Person to perform any of the duties, covenants or obligations to be
performed by the Master Servicer hereunder. If, pursuant to any provision
hereof, the duties of the Master Servicer are transferred to a successor master
servicer, the entire amount of the Servicing Fee and other compensation payable
to the Master Servicer pursuant hereto shall thereafter be payable to such
successor master servicer.

               SECTION 6.05.          Rights of the Depositor in Respect of the
                                      Master Servicer.

               The Master Servicer shall afford (and any Sub-Servicing Agreement
shall provide that each Sub-Servicer shall afford) the Depositor, the Trustee
and the Trust Administrator, upon reasonable notice, during normal business
hours, access to all records maintained by the Master Servicer (and any such
Sub-Servicer) in respect of the Master Servicer's rights and obligations
hereunder and access to officers of the Master Servicer (and those of any such
Sub-Servicer) responsible for such obligations. Upon request, the Master
Servicer shall furnish to the Depositor, the Trustee and the Trust Administrator
its (and any such Sub-Servicer's) most recent financial statements of the parent
company of the Master Servicer and such other information relating to the Master
Servicer's capacity to perform its obligations under this Agreement that it
possesses. To the extent such information is not otherwise available to the
public, the Depositor, the Trustee and the Trust Administrator shall not
disseminate any information obtained pursuant to the preceding two sentences
without the Master Servicer's written consent, except as required pursuant to
this Agreement or to the extent that it is appropriate to do so (i) in working
with legal counsel, auditors, taxing authorities or other governmental agencies,
rating agencies or reinsurers or (ii) pursuant to any law, rule, regulation,
order, judgment, writ, injunction or decree of any court or governmental
authority having jurisdiction over the Depositor, the Trustee, the Trust
Administrator or the Trust Fund, and in either case, the Depositor, the Trustee
or the Trust Administrator, as the case may be, shall use its best efforts to
assure the confidentiality of any such disseminated non-public information. The
Depositor may, but is not obligated to, enforce the obligations of the Master
Servicer under this Agreement and may, but is not obligated to, perform, or
cause a designee to perform, any defaulted obligation of the Master Servicer
under this Agreement or exercise the rights of the Master Servicer under this
Agreement; provided that the Master Servicer shall not be relieved of any of its
obligations under this Agreement by virtue of such performance by the Depositor
or its designee. The Depositor shall not have any responsibility or liability
for any action or failure to act by the Master Servicer and is not obligated to
supervise the performance of the Master Servicer under this Agreement or
otherwise.


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                                   ARTICLE VII

                                     DEFAULT

               SECTION 7.01.          Master Servicer Events of Default.

               "Master Servicer Event of Default," wherever used herein, means
any one of the following events:

                     (i) any failure by the Master Servicer to remit to the
               Trustee for distribution to the Certificateholders any payment
               (other than a P&I Advance required to be made from its own funds
               on any Master Servicer Remittance Date pursuant to Section 4.03)
               required to be made under the terms of the Certificates and this
               Agreement which continues unremedied for a period of one Business
               Day after the date upon which written notice of such failure,
               requiring the same to be remedied, shall have been given to the
               Master Servicer by the Depositor, the Trust Administrator or the
               Trustee (in which case notice shall be provided by telecopy), or
               to the Master Servicer, the Depositor, the Trust Administrator
               and the Trustee by the Holders of Certificates entitled to at
               least 25% of the Voting Rights; or

                    (ii) any failure on the part of the Master Servicer duly to
               observe or perform in any material respect any of the covenants
               or agreements on the part of the Master Servicer contained in the
               Certificates or in this Agreement which continues unremedied for
               a period of 30 days after the earlier of (i) the date on which
               written notice of such failure, requiring the same to be
               remedied, shall have been given to the Master Servicer by the
               Depositor, the Trust Administrator or the Trustee, or to the
               Master Servicer, the Depositor, the Trust Administrator and the
               Trustee by the Holders of Certificates entitled to at least 25%
               of the Voting Rights and (ii) actual knowledge of such failure by
               a Servicing Officer of the Master Servicer; or

                   (iii) a decree or order of a court or agency or supervisory
               authority having jurisdiction in the premises in an involuntary
               case under any present or future federal or state bankruptcy,
               insolvency or similar law or the appointment of a conservator or
               receiver or liquidator in any insolvency, readjustment of debt,
               marshalling of assets and liabilities or similar proceeding, or
               for the winding-up or liquidation of its affairs, shall have been
               entered against the Master Servicer and if such proceeding is
               being contested by the Master Servicer in good faith such decree
               or order shall have remained in force undischarged or unstayed
               for a period of 60 consecutive days or results in the entry of an
               order for relief or any such adjudication or appointment; or

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



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                     (v) the Master 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) any failure of the Master Servicer to make any P&I
               Advance on any Master Servicer Remittance Date required to be
               made from its own funds pursuant to Section 4.03 which continues
               unremedied for a period of one Business Day after the date upon
               which written notice of such failure (which notice the Trustee
               must provide by 3:00 p.m. New York time on the Business Day
               following the Master Servicer Remittance Date), requiring the
               same to be remedied, shall have been given to the Master Servicer
               by the Trustee.

               If a Master Servicer Event of Default described in clauses (i)
through (v) of this Section shall occur, then, and in each and every such case,
so long as such Master Servicer Event of Default shall not have been remedied,
the Depositor or the Trustee may, and at the written direction of the Holders of
Certificates entitled to at least 51% of Voting Rights, the Trustee shall, by
notice in writing to the Master Servicer (and to the Depositor if given by the
Trustee or to the Trustee if given by the Depositor), terminate all of the
rights and obligations of the Master Servicer in its capacity as a Master
Servicer under this Agreement, to the extent permitted by law, and in and to the
Mortgage Loans and the proceeds thereof. If a Master Servicer Event of Default
described in clause (vi) hereof shall occur and shall not have been remedied by
1:00 p.m. on the related Distribution Date, the Trustee shall be obligated to
make such P&I Advance and, then so long as such Master Servicer Event of Default
shall not have been remedied during the applicable time period set forth in
clause (vi) above (including the reimbursement to the Trustee by the Master
Servicer, with interest thereon at the Prime Rate, for any P&I Advance made),
the Trustee shall, by notice in writing to the Master Servicer and the
Depositor, terminate all of the rights and obligations of the Master Servicer in
its capacity as a Master Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof. On or after the receipt by the Master
Servicer of such written notice, all authority and power of the Master Servicer
under this Agreement, whether with respect to the Certificates (other than as a
Holder of any Certificate) or the Mortgage Loans or otherwise, shall pass to and
be vested in the Trustee pursuant to and under this Section and, without
limitation, the Trustee is hereby authorized and empowered, as attorney-in-fact
or otherwise, to execute and deliver on behalf of and at the expense of the
Master Servicer, any and all documents and other instruments and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. The Master Servicer agrees, at its sole cost and expense, promptly
(and in any event no later than ten Business Days subsequent to such notice) to
provide the Trustee with all documents and records requested by it to enable it
to assume the Master Servicer's functions under this Agreement, and to cooperate
with the Trustee in effecting the termination of the Master Servicer's
responsibilities and rights under this Agreement, including, without limitation,
the transfer within one Business Day to the Trustee for administration by it of
all cash amounts which at the time shall be or should have been credited by the
Master Servicer to the Collection Account held by or on behalf of the Master
Servicer, the Distribution Account or any REO Account or Servicing Account held
by or on behalf of the Master Servicer or thereafter be received with respect to
the Mortgage Loans or any REO Property serviced


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by the Master Servicer (provided, however, that the Master Servicer shall
continue to be entitled to receive all amounts accrued or owing to it under this
Agreement on or prior to the date of such termination, whether in respect of P&I
Advances or otherwise, and shall continue to be entitled to the benefits of
Section 6.03, notwithstanding any such termination, with respect to events
occurring prior to such termination). For purposes of this Section 7.01, the
Trustee shall not be deemed to have knowledge of a Master Servicer Event of
Default unless a Responsible Officer of the Trustee assigned to and working in
the Trustee's Corporate Trust Office has actual knowledge thereof or unless
written notice of any event which is in fact such a Master Servicer Event of
Default is received by the Trustee and such notice references the Certificates,
the Trust Fund or this Agreement.

               SECTION 7.02.          Trustee to Act; Appointment of Successor.

               (a) On and after the time the Master Servicer receives a notice
of termination, the Trustee shall be the successor in all respects to the Master
Servicer in its capacity as Master Servicer under this Agreement, the Master
Servicer shall not have the right to withdraw any funds from the Collection
Account without the consent of the Trustee and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto and arising thereafter placed on the Master
Servicer (except for any representations or warranties of the Master Servicer
under this Agreement, the responsibilities, duties and liabilities contained in
Section 2.03(c) and its obligation to deposit amounts in respect of losses
pursuant to Section 3.12) by the terms and provisions hereof including, without
limitation, the Master Servicer's obligations to make P&I Advances pursuant to
Section 4.03; provided, however, that if the Trustee is prohibited by law or
regulation from obligating itself to make advances regarding delinquent mortgage
loans, then the Trustee shall not be obligated to make P&I Advances pursuant to
Section 4.03; and provided further, that any failure to perform such duties or
responsibilities caused by the Master Servicer's failure to provide information
required by Section 7.01 shall not be considered a default by the Trustee as
successor to the Master Servicer hereunder. As compensation therefor, the
Trustee shall be entitled to the Servicing Fees and all funds relating to the
Mortgage Loans to which the Master Servicer would have been entitled if it had
continued to act hereunder (other than amounts which were due or would become
due to the Master Servicer prior to its termination or resignation).
Notwithstanding the above and subject to the next paragraph, the Trustee may, if
it shall be unwilling to so act, or shall, if it is unable to so act or if it is
prohibited by law from making advances regarding delinquent mortgage loans, or
if the Holders of Certificates entitled to at least 51% of the Voting Rights so
request in writing to the Trustee, promptly appoint or petition a court of
competent jurisdiction to appoint, an established mortgage loan servicing
institution acceptable to the Rating Agencies and having a net worth of not less
than $15,000,000 as the successor to the Master Servicer under this Agreement in
the assumption of all or any part of the responsibilities, duties or liabilities
of the Master Servicer under this Agreement. No appointment of a successor to
the Master Servicer under this Agreement shall be effective until the assumption
by the successor of all of the Master Servicer's responsibilities, duties and
liabilities hereunder. In connection with such appointment and assumption
described herein, the Trustee may make such arrangements for the compensation of
such successor out of payments on Mortgage Loans as it and such successor shall
agree; provided, however, that no such compensation shall be in excess of that
permitted the Master Servicer as such hereunder. The Depositor, the Trustee and
such successor shall take such action, consistent with this Agreement, as shall
be necessary to effectuate any such succession. Pending appointment of a


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successor to the Master Servicer under this Agreement, the Trustee shall act in
such capacity as hereinabove provided.

               Upon removal or resignation of the Master Servicer, the Trustee,
with the cooperation of the Depositor, (x) shall solicit bids for a successor
Master Servicer as described below and (y) pending the appointment of a
successor Master Servicer as a result of soliciting such bids, shall serve as
Master Servicer of the Mortgage Loans serviced by such predecessor Master
Servicer. The Trustee shall solicit, by public announcement, bids from housing
and home finance institutions, banks and mortgage servicing institutions meeting
the qualifications set forth above (including the Trustee or any affiliate
thereof). Such public announcement shall specify that the successor Master
Servicer shall be entitled to the servicing compensation agreed upon between the
Trustee, the successor Master Servicer and the Depositor; provided, however,
that no such fee shall exceed the related Servicing Fee. Within thirty days
after any such public announcement, the Trustee, with the cooperation of the
Depositor, shall negotiate in good faith and effect the sale, transfer and
assignment of the servicing rights and responsibilities hereunder to the
qualified party submitting the highest satisfactory bid as to the price they
will pay to obtain such servicing. The Trustee upon receipt of the purchase
price shall pay such purchase price to the Master Servicer being so removed,
after deducting from any sum received by the Trustee from the successor to the
Master Servicer in respect of such sale, transfer and assignment all costs and
expenses of any public announcement and of any sale, transfer and assignment of
the servicing rights and responsibilities reasonably incurred hereunder. After
such deductions, the remainder of such sum shall be paid by the Trustee to the
Master Servicer at the time of such sale.

               (b) If the Master Servicer fails to remit to the Trustee for
distribution to the Certificateholders any payment required to be made under the
terms of the Certificates and this Agreement (for purposes of this Section
7.02(b), a "Remittance") because the Master Servicer is the subject of a
proceeding under the federal Bankruptcy Code and the making of such Remittance
is prohibited by Section 362 of the federal Bankruptcy Code, the Trustee shall
upon notice of such prohibition, regardless of whether it has received a notice
of termination under Section 7.01, advance the amount of such Remittance by
depositing such amount in the Distribution Account on the related Distribution
Date. The Trustee shall be obligated to make such advance only if (i) such
advance, in the good faith judgment of the Trustee, can reasonably be expected
to be ultimately recoverable from Stayed Funds and (ii) the Trustee is not
prohibited by law from making such advance or obligating itself to do so. Upon
remittance of the Stayed Funds to the Trustee or the deposit thereof in the
Distribution Account by the Master Servicer, a trustee in bankruptcy or a
federal bankruptcy court, the Trustee may recover the amount so advanced,
without interest, by withdrawing such amount from the Distribution Account;
however, nothing in this Agreement shall be deemed to affect the Trustee's
rights to recover from the Master Servicer's own funds interest on the amount of
any such advance. If the Trustee at any time makes an advance under this
Subsection which it later determines in its good faith judgment will not be
ultimately recoverable from the Stayed Funds with respect to which such advance
was made, the Trustee shall be entitled to reimburse itself for such advance,
without interest, by withdrawing from the Distribution Account, out of amounts
on deposit therein, an amount equal to the portion of such advance attributable
to the Stayed Funds.

               SECTION 7.03.          Notification to Certificateholders.



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               (a) Upon any termination of the Master Servicer pursuant to
Section 7.01 above or any appointment of a successor to the Master Servicer
pursuant to Section 7.02 above, the Trustee shall give prompt written notice
thereof to Certificateholders at their respective addresses appearing in the
Certificate Register.

               (b) Not later than the later of 60 days after the occurrence of
any event, which constitutes or which, with notice or lapse of time or both,
would constitute a Master Servicer Event of Default or five days after a
Responsible Officer of the Trustee becomes aware of the occurrence of such an
event, the Trustee shall transmit by mail to all Holders of Certificates notice
of each such occurrence, unless such default or Master Servicer Event of Default
shall have been cured or waived.

               SECTION 7.04.          Waiver of Master Servicer Events of
                                      Default.

               Subject to Section 11.09(d), the Holders representing at least
66% of the Voting Rights evidenced by all Classes of Certificates affected by
any default or Master Servicer Event of Default hereunder may waive such default
or Master Servicer Event of Default; provided, however, that a default or Master
Servicer Event of Default under clause (i) or (vi) of Section 7.01 may be waived
only by all of the Holders of the Regular Certificates. Upon any such waiver of
a default or Master Servicer Event of Default, such default or Master Servicer
Event of Default shall cease to exist and shall be deemed to have been remedied
for every purpose hereunder. No such waiver shall extend to any subsequent or
other default or Master Servicer Event of Default or impair any right consequent
thereon except to the extent expressly so waived.


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                                  ARTICLE VIII

                        CONCERNING THE TRUSTEE AND THE TRUST ADMINISTRATOR

               SECTION 8.01.          Duties of Trustee and Trust Administrator.

               Each of the Trustee and the Trust Administrator, prior to the
occurrence of a Master Servicer Event of Default and after the curing of all
Master Servicer Events of Default which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this
Agreement. During a Master Servicer Event of Default, each of the Trustee and
the Trust Administrator shall exercise such of the rights and powers vested in
it by this Agreement, and use the same degree of care and skill in their
exercise as a prudent person would exercise or use under the circumstances in
the conduct of such person's own affairs. Any permissive right of the Trustee or
the Trust Administrator enumerated in this Agreement shall not be construed as a
duty.

               Each of the Trustee and the Trust Administrator, upon receipt of
all resolutions, certificates, statements, opinions, reports, documents, orders
or other instruments furnished to it, which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they conform to the requirements of this Agreement. If any
such instrument is found not to conform to the requirements of this Agreement in
a material manner, it shall take such action as it deems appropriate to have the
instrument corrected, and if the instrument is not corrected to its
satisfaction, it will provide notice thereof to the Certificateholders.

               No provision of this Agreement shall be construed to relieve the
Trustee or the Trust Administrator from liability for its own negligent action,
its own negligent failure to act or its own misconduct; provided, however, that:

                     (i) Prior to the occurrence of a Master Servicer Event of
               Default, and after the curing of all such Master Servicer Events
               of Default which may have occurred, the duties and obligations of
               each of the Trustee and the Trust Administrator shall be
               determined solely by the express provisions of this Agreement,
               neither the Trustee nor the Trust Administrator shall be liable
               except for the performance of such duties and obligations as are
               specifically set forth in this Agreement, no implied covenants or
               obligations shall be read into this Agreement against the Trustee
               or the Trust Administrator and, in the absence of bad faith on
               the part of the Trustee or the Trust Administrator, as
               applicable, the Trustee or the Trust Administrator, as the case
               may be, may conclusively rely, as to the truth of the statements
               and the correctness of the opinions expressed therein, upon any
               certificates or opinions furnished to the Trustee or the Trust
               Administrator, as the case may be, that conform to the
               requirements of this Agreement;

                    (ii) Neither the Trustee nor the Trust Administrator shall
               be personally liable for any error of judgment made in good faith
               by a Responsible Officer or Responsible Officers of the it unless
               it shall be proved that it was negligent in ascertaining the
               pertinent facts;



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                   (iii) Neither the Trustee nor the Trust Administrator shall
               be personally liable with respect to any action taken, suffered
               or omitted to be taken by it in good faith in accordance with the
               direction of the Holders of Certificates entitled to at least 25%
               of the Voting Rights relating to the time, method and place of
               conducting any proceeding for any remedy available to the it or
               exercising any trust or power conferred upon it, under this
               Agreement; and

                    (iv) Neither the Trustee nor the Trust Administrator shall
               be required to take notice or be deemed to have notice or
               knowledge of any default unless a Responsible Officer of the
               Trustee shall have received written notice thereof or a
               Responsible Officer shall have actual knowledge thereof. In the
               absence of receipt of such notice or actual knowledge, the
               Trustee or the Trust Administrator, as the case may be, may
               conclusively assume there is no default.

               SECTION 8.02.          Certain Matters Affecting the Trustee and
                                      the Trust Administrator.

               (a)     Except as otherwise provided in Section 8.01:

                     (i) Each of the Trustee and the Trust Administrator and any
               director, officer, employee or agent of the Trustee and the Trust
               Administrator, as the case may be, may request and conclusively
               rely upon and shall be fully protected in acting or refraining
               from acting upon any resolution, Officers' Certificate,
               certificate of auditors or any other certificate, statement,
               instrument, opinion, report, notice, request, consent, order,
               appraisal, bond or other paper or document reasonably believed by
               it to be genuine and to have been signed or presented by the
               proper party or parties;

                    (ii) Each of the Trustee and the Trust Administrator may
               consult with counsel of its selection and any formal written
               advice or Opinion of Counsel shall be full and complete
               authorization and protection in respect of any action taken or
               suffered or omitted by it hereunder in good faith and in
               accordance with such formal written advice or Opinion of Counsel;

                   (iii) Neither the Trustee nor the Trust Administrator shall
               be under any obligation to exercise any of the trusts or powers
               vested in it by this Agreement or to institute, conduct or defend
               any litigation hereunder or in relation hereto at the request,
               order or direction of any of the Certificateholders, pursuant to
               the provisions of this Agreement, unless such Certificateholders
               shall have offered to the Trustee or the Trust Administrator, as
               applicable, security or indemnity satisfactory to it against the
               costs, expenses and liabilities which may be incurred therein or
               thereby; nothing contained herein shall, however, relieve the
               Trustee or the Trust Administrator of the obligation, upon the
               occurrence of a Master Servicer Event of Default (which has not
               been cured or waived), to exercise such of the rights and powers
               vested in it by this Agreement, and to use the same degree of
               care and skill


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               in their exercise as a prudent person would exercise or use under
               the circumstances in the conduct of such person's own affairs;

                    (iv) Neither the Trustee nor the Trust Administrator shall
               be personally liable for any action taken, suffered or omitted by
               it in good faith and believed by it to be authorized or within
               the discretion or rights or powers conferred upon it by this
               Agreement;

                     (v) Prior to the occurrence of a Master Servicer Event of
               Default hereunder and after the curing of all Master Servicer
               Events of Default which may have occurred, neither the Trustee
               nor the Trust Administrator shall be bound to make any
               investigation into the facts or matters stated in any resolution,
               certificate, statement, instrument, opinion, report, notice,
               request, consent, order, approval, bond or other paper or
               document, unless requested in writing to do so by the Holders of
               Certificates entitled to at least 25% of the Voting Rights;
               provided, however, that if the payment within a reasonable time
               to the Trustee or the Trust Administrator, as applicable, of the
               costs, expenses or liabilities likely to be incurred by it in the
               making of such investigation is, in the opinion of the Trustee or
               the Trust Administrator, as applicable, not reasonably assured to
               the Trustee or the Trust Administrator, as applicable, by such
               Certificateholders, the Trustee or the Trust Administrator, as
               applicable, may require indemnity satisfactory to the Trustee or
               Trust Administrator, as applicable, against such cost, expense,
               or liability from such Certificateholders as a condition to
               taking any such action;

                    (vi) Each of the Trustee and the Trust Administrator may
               execute any of the trusts or powers hereunder or perform any
               duties hereunder either directly or by or through agents or
               attorneys and neither the Trustee nor the Trust Administrator
               shall be responsible for any misconduct or negligence on the part
               of any agent or attorney appointed with due care;

                   (vii) Neither the Trustee nor the Trust Administrator shall
               be personally liable for any loss resulting from the investment
               of funds held in the Collection Account at the direction of the
               Master Servicer pursuant to Section 3.12; and

                  (viii) Any request or direction of the Depositor, the Master
               Servicer or the Certificateholders mentioned herein shall be
               sufficiently evidenced in writing.

               (b) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee or the Trust Administrator, may be
enforced by it without the possession of any of the Certificates, or the
production thereof at the trial or other proceeding relating thereto, and any
such suit, action or proceeding instituted by the Trustee or the Trust
Administrator shall be brought in its name for the benefit of all the Holders of
such Certificates, subject to the provisions of this Agreement.

               SECTION 8.03.          Neither Trustee nor Trust Administrator
                                      Liable for Certificates or Mortgage Loans.


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               The recitals contained herein and in the Certificates (other than
the signature of the Trustee or the Trust Administrator, the authentication of
the Trustee on the Certificates, the acknowledgments of the Trustee contained in
Article II and the representations and warranties of the Trustee and the Trust
Administrator in Section 8.12) shall be taken as the statements of the Depositor
and neither the Trustee nor the Trust Administrator assumes any responsibility
for their correctness. Neither the Trustee nor the Trust Administrator makes any
representations or warranties as to the validity or sufficiency of this
Agreement (other than as specifically set forth in Section 8.12) or of the
Certificates (other than the signature of the Trustee and authentication of the
Trustee on the Certificates) or of any Mortgage Loan or related document.
Neither the Trustee nor the Trust Administrator shall be accountable for the use
or application by the Depositor of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Depositor or the Master Servicer in respect of the Mortgage Loans or deposited
in or withdrawn from the Collection Account by the Master Servicer, other than
any funds held by or on behalf of the Trustee in accordance with Section 3.10.

               SECTION 8.04.          Trustee and Trust Administrator May Own
                                      Certificates.

               Each of the Trustee and the Trust Administrator in its individual
capacity or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Trustee or Trust
Administrator, as applicable.

               SECTION 8.05.          Trustee's and Trust Administrator's Fees
                                      and Expenses.

               (a) The compensation to be paid to the Trustee in respect of its
obligations under this Agreement will be the amounts paid by the Master Servicer
pursuant to a letter agreement between the Trustee and the Master Servicer
(which compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust). The compensation to be paid
to the Trust Administrator in respect of its obligations under this Agreement
will be the amounts paid by the Master Servicer pursuant to a letter agreement
between the Trust Administrator and the Master Servicer. Each of the Trustee and
the Trust Administrator and any director, officer, employee or agent of the
Trustee or the Trust Administrator, as applicable, shall be indemnified by REMIC
I and held harmless against any loss, liability or expense (not including
expenses, disbursements and advances incurred or made by the Trustee or the
Trust Administrator, as applicable, including the compensation and the expenses
and disbursements of its agents and counsel, in the ordinary course of the
Trustee's or Trust Administrator's, as the case may be, performance in
accordance with the provisions of this Agreement) incurred by the Trustee or the
Trust Administrator, as applicable, in connection with any claim or legal action
or any pending or threatened claim or legal action arising out of or in
connection with the acceptance or administration of its obligations and duties
under this Agreement, other than any loss, liability or expense (i) resulting
from any breach of the Master Servicer's (and in the case of the Trustee, the
Trust Administrator's or in the case of the Trust Administrator, the Trustee's)
obligations in connection with this Agreement and the Mortgage Loans, (ii) that
constitutes a specific liability of the Trustee or the Trust Administrator, as
applicable, pursuant to Section 10.01(g) or (iii) any loss, liability or expense
incurred by reason of willful misfeasance, bad faith or negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder or as a result of a breach of the Trust
Administrator's obligations under Article X hereof. Any amounts payable


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to the Trustee, or any director, officer, employee or agent of the Trustee in
respect of the indemnification provided by this paragraph (a), or pursuant to
any other right of reimbursement from the Trust Fund that the Trustee or any
director, officer, employee or agent of the Trustee may have hereunder in its
capacity as such, may be withdrawn by the Trustee from the Distribution Account
at any time.

               (b) The Master Servicer agrees to indemnify the Trustee and the
Trust Administrator from, and hold each harmless against, any loss, liability or
expense resulting from a breach of the Master Servicer's obligations and duties
under this Agreement. Such indemnity shall survive the termination or discharge
of this Agreement and the resignation or removal of the Trustee or the Trust
Administrator, as the case may be. Any payment hereunder made by the Master
Servicer to the Trustee or the Trust Administrator shall be from the Master
Servicer's own funds, without reimbursement from the Trust Fund therefor.

               (c) The Master Servicer shall pay any annual rating agency fees
of the Rating Agencies for ongoing surveillance from its own funds without right
of reimbursement.

               SECTION 8.06.          Eligibility Requirements for Trustee and
                                      Trust Administrator.

               Each of the Trustee and the Trust Administrator hereunder shall
at all times be a corporation or an association (other than the Depositor, the
Seller; and, solely in the case of the Trustee, the Master Servicer or any
Affiliate of the foregoing) organized and doing business under the laws of any
state or the United States of America, and with respect to the Trustee,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $50,000,000 and subject to supervision or
examination by federal or state authority. In case at any time the Trustee or
the Trust Administrator shall cease to be eligible in accordance with the
provisions of this Section, the Trustee or the Trust Administrator, as the case
may be, shall resign immediately in the manner and with the effect specified in
Section 8.07.

               SECTION 8.07.          Resignation and Removal of the Trustee and
                                      the Trust Administrator.

               Either of the Trustee or the Trust Administrator may at any time
resign and be discharged from the trust hereby created by giving written notice
thereof to the Depositor, the Master Servicer and the Certificateholders and, if
the Trustee is resigning, to the Trust Administrator, or, if the Trust
Administrator is resigning, to the Trustee. Upon receiving such notice of
resignation, the Depositor shall promptly appoint a successor trustee or trust
administrator (which may be the same Person in the event the Trust Administrator
resigns or is removed) by written instrument, in duplicate, which instrument
shall be delivered to the resigning Trustee or Trust Administrator and to the
successor trustee or trust administrator, as applicable. A copy of such
instrument shall be delivered to the Certificateholders, the Trustee or Trust
Administrator, as applicable, and the Master Servicer by the Depositor. If no
successor trustee or trust administrator shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee or Trust Administrator, as applicable, may
petition any court of competent jurisdiction for the appointment of a successor
trustee or trust administrator, as applicable.



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               If at any time the Trustee or the Trust Administrator shall cease
to be eligible in accordance with the provisions of Section 8.06 and shall fail
to resign after written request therefor by the Depositor (or in the case of the
Trust Administrator, the Trustee), or if at any time the Trustee or the Trust
Administrator shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or the Trust Administrator or of its
property shall be appointed, or any public officer shall take charge or control
of the Trustee or the Trust Administrator or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then the Depositor (or
in the case of the Trust Administrator, the Trustee) may remove the Trustee or
the Trust Administrator, as applicable, and appoint a successor trustee or trust
administrator (which may be the same Person in the event the Trust Administrator
resigns or is removed) by written instrument, in duplicate, which instrument
shall be delivered to the Trustee or Trust Administrator, so removed, so removed
and to the successor trustee or trust administrator. A copy of such instrument
shall be delivered to the Certificateholders, the Trustee or the Trust
Administrator, as applicable, and the Master Servicer by the Depositor.

               The Holders of Certificates entitled to at least 51% of the
Voting Rights may at any time remove the Trustee or the Trust Administrator and
appoint a successor trustee or trust administrator by written instrument or
instruments, in triplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to the
Depositor, one complete set to the Trustee or the Trust Administrator, as the
case may be, so removed and one complete set to the successor so appointed. A
copy of such instrument shall be delivered to the Certificateholders and the
Master Servicer by the Depositor. In addition, if the Trustee has knowledge that
the Trust Administrator has breached any of its duties under this Agreement, the
Trustee may remove the Trust Administrator in the same manner as provided in the
prior sentence. For purposes of this Section, the Trustee shall not be deemed to
have knowledge of a breach by the Trust Administrator of any of its duties
hereunder, unless a Responsible Officer of the Trustee, assigned to and working
in the Trustee's Corporate Trust Office has actual knowledge thereof or unless
written notice of any event which is in fact such a breach is received by a
Responsible Officer of the Trustee or is provided to the Trustee as provided in
Section 11.05, and such notice references the Certificates, the Trust Fund or
this Agreement.

               Any resignation or removal of the Trustee or the Trust
Administrator and appointment of a successor trustee or trust administrator, as
the case may be, pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee or
trust administrator as provided in Section 8.08. Notwithstanding the foregoing,
in the event the Trust Administrator advises the Trustee that it is unable to
continue to perform its obligations pursuant to the terms of this Agreement
prior to the appointment of a successor, the Trustee shall be obligated to
perform such obligations until a new trust administrator is appointed. Such
performance shall be without prejudice to any claim by a party hereto or
beneficiary hereof resulting from the Trust Administrator's breach of its
obligations hereunder.

               SECTION 8.08.          Successor Trustee or Trust Administrator.

               Any successor trustee or trust administrator appointed as
provided in Section 8.07 shall execute, acknowledge and deliver to the
Depositor, the Trustee or the Trust Administrator, as applicable, and to its
predecessor trustee or trust administrator an instrument accepting such


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appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee or trust administrator shall become effective and such
successor trustee or trust administrator, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if originally
named as trustee or trust administrator herein. The predecessor trustee or trust
administrator shall deliver to the successor trustee or trust administrator all
Mortgage Files and related documents and statements, as well as all moneys, held
by it hereunder and the Depositor and the predecessor trustee or trust
administrator shall execute and deliver such instruments and do such other
things as may reasonably be required for more fully and certainly vesting and
confirming in the successor trustee or trust administrator all such rights,
powers, duties and obligations.

               No successor trustee or trust administrator shall accept
appointment as provided in this Section unless at the time of such acceptance
such successor trustee or trust administrator shall be eligible under the
provisions of Section 8.06 and the appointment of such successor trustee or
trust administrator shall not result in a downgrading of any Class of
Certificates by the Rating Agencies, as evidenced by a letter from the Rating
Agencies.

               Upon acceptance of appointment by a successor trustee or trust
administrator as provided in this Section, the Depositor shall mail notice of
the succession of such trustee or trust administrator hereunder to all Holders
of Certificates at their addresses as shown in the Certificate Register. If the
Depositor fails to mail such notice within 10 days after acceptance of
appointment by the successor trustee or trust administrator, the successor
trustee or trust administrator shall cause such notice to be mailed at the
expense of the Depositor.

               SECTION 8.09.          Merger or Consolidation of Trustee or
                                      Trust Administrator.

               Any corporation or association into which either the Trustee or
the Trust Administrator may be merged or converted or with which it may be
consolidated or any corporation or association resulting from any merger,
conversion or consolidation to which the Trustee or the Trust Administrator, as
the case may be, shall be a party, or any corporation or association succeeding
to the business of the Trustee or the Trust Administrator, as applicable, shall
be the successor of the Trustee or the Trust Administrator, as the case may be,
hereunder, provided such corporation or association shall be eligible under the
provisions of Section 8.06, 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 8.10.          Appointment of Co-Trustee or Separate
                                      Trustee.

               Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of REMIC I or property securing the same may at the time be located, the Master
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of REMIC I, and to
vest in such Person or Persons, in such capacity, such title to REMIC I, or any
part thereof, and, subject to the other provisions of this Section 8.10, such
powers, duties, obligations, rights and trusts as the Master Servicer and the
Trustee may consider


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necessary or desirable. If the Master Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request to do so, or in
case a Master Servicer Event of Default shall have occurred and be continuing,
the Trustee alone shall have the power to make such appointment. No co-trustee
or separate trustee hereunder shall be required to meet the terms of eligibility
as a successor trustee under Section 8.06 hereunder and no notice to Holders of
Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be
required under Section 8.08 hereof.

               In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed by the Trustee (whether as
Trustee hereunder or as successor to the Master Servicer hereunder), the Trustee
shall be incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of title to
REMIC I or any portion thereof in any such jurisdiction) shall be exercised and
performed by such separate trustee or co-trustee at the direction of the
Trustee.

               Any notice, request or other writing given to the Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VIII. Each separate trustee and co-trustee, upon
its acceptance of the trust conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee.

               Any separate trustee or co-trustee may, at any time, constitute
the Trustee, its agent or attorney-in-fact, with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.

               SECTION 8.11.          [intentionally omitted]

               SECTION 8.12.          Appointment of Office or Agency.

               The Trustee will appoint an office or agency in the City of New
York, New York where the Certificates may be surrendered for registration of
transfer or exchange, and presented for final distribution, and where notices
and demands to or upon the Trustee in respect of the Certificates and this
Agreement may be served.

               SECTION 8.13.          Representations and Warranties.



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               Each of the Trustee and the Trust Administrator hereby represents
and warrants to the Master Servicer, the Depositor and the Trustee or the Trust
Administrator, as applicable, as of the Closing Date, that:

               (i) It is duly organized, validly existing and in good standing
        under the laws of the State of New York.

               (ii) The execution and delivery of this Agreement by it, and the
        performance and compliance with the terms of this Agreement by it, will
        not violate its articles of association or bylaws or constitute a
        default (or an event which, with notice or lapse of time, or both, would
        constitute a default) under, or result in the breach of, any material
        agreement or other instrument to which it is a party or which is
        applicable to it or any of its assets.

               (iii) It has the full power and authority to enter into and
        consummate all transactions contemplated by this Agreement, has duly
        authorized the execution, delivery and performance of this Agreement,
        and has duly executed and delivered this Agreement.

               (iv) This Agreement, assuming due authorization, execution and
        delivery by the other parties hereto, constitutes a valid, legal and
        binding obligation of it, enforceable against it in accordance with the
        terms hereof, subject to (A) applicable bankruptcy, insolvency,
        receivership, reorganization, moratorium and other laws affecting the
        enforcement of creditors' rights generally, and (B) general principles
        of equity, regardless of whether such enforcement is considered in a
        proceeding in equity or at law.

               (v) It is not in violation of, and its execution and delivery of
        this Agreement and its performance and compliance with the terms of this
        Agreement will not constitute a violation of, any law, any order or
        decree of any court or arbiter, or any order, regulation or demand of
        any federal, state or local governmental or regulatory authority, which
        violation, in its good faith and reasonable judgment, is likely to
        affect materially and adversely either the ability of the it to perform
        its obligations under this Agreement or the financial condition of it.

               (vi) No litigation is pending or, to the best of its knowledge,
        threatened against it which would prohibit it from entering into this
        Agreement or, in its good faith reasonable judgment, is likely to
        materially and adversely affect either the ability of it to perform its
        obligations under this Agreement or the financial condition of it.




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                                   ARTICLE IX

                                   TERMINATION

               SECTION 9.01           Termination Upon Repurchase or Liquidation
                                      of the REMIC I Regular Interests.

               (a) Subject to Section 9.02, the respective obligations and
responsibilities under this Agreement of the Depositor, the Master Servicer, the
Trustee and the Trust Administrator with respect to the Mortgage Loans (other
than the obligations of the Master Servicer to the Trustee and the Trust
Administrator pursuant to Section 8.05 and of the Master Servicer to provide for
and the Trustee to make payments to the Holders of the related Class(es) of the
Certificates as hereinafter set forth) shall terminate upon payment to the
Certificateholders and the deposit of all amounts held by or on behalf of the
Trustee and required hereunder to be so paid or deposited on the Distribution
Date coinciding with or following the earlier to occur of (i) the purchase by
the Master Servicer of all Mortgage Loans and each REO Property remaining in
REMIC I and (ii) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in REMIC I;
provided, however, that in no event shall the trust created hereby continue
beyond the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late ambassador of the United States to
the Court of St. James, living on the date hereof. The purchase by the Master
Servicer of all Mortgage Loans and each REO Property remaining in REMIC I shall
be at a price (the "Termination Price") equal to the greater of (A) the
aggregate Purchase Price of all the Mortgage Loans included in REMIC I, plus the
appraised value of each REO Property, if any, included in REMIC I, such
appraisal to be conducted by an appraiser mutually agreed upon by the Master
Servicer and the Trustee in their reasonable discretion and (B) the aggregate
fair market value of all of the assets in REMIC I (as determined by the Master
Servicer, with the consent of the Trustee, as of the close of business on the
third Business Day next preceding the date upon which notice of any such
termination is furnished to Certificateholders pursuant to the third paragraph
of this Section 9.01).

               (b) The Master Servicer shall have the right to purchase all of
the Mortgage Loans and each REO Property remaining in REMIC I pursuant to clause
(i) of the preceding paragraph no later than the Determination Date in the month
immediately preceding the Distribution Date on which the Certificates will be
retired; provided, however, that the Master Servicer, as provided above, may
elect to purchase all of the Mortgage Loans and each REO Property remaining in
REMIC I pursuant to clause (i) above only if the aggregate Stated Principal
Balance of the Mortgage Loans and each REO Property remaining in the Trust Fund
at the time of such election is reduced to less than 10% of the aggregate Stated
Principal Balance of the Mortgage Loans at the Cut-off Date. For federal income
tax purposes, the purchase by the Master Servicer of all Mortgage Loans and all
REO Properties underlying the Certificates is intended to facilitate a
redemption of such Certificates pursuant to a "cleanup call" within the meaning
of Treasury regulation section 1.860G-2(j). Notwithstanding the foregoing, the
Master Servicer shall have the right to transfer, sell or assign its rights to
purchase all of the Mortgage Loans and each REO Property remaining in REMIC I.

               (c) Notice of the liquidation of the Certificates shall be given
promptly by the Trustee by letter to Certificateholders mailed (a) in the event
such notice is given in connection with


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the purchase of the Mortgage Loans and each REO Property remaining in REMIC I by
the Master Servicer, not earlier than the 15th day and not later than the 25th
day of the month next preceding the month of the final distribution on the
Certificates or (b) otherwise during the month of such final distribution on or
before the Determination Date in such month, in each case specifying (i) the
Distribution Date upon which the Trust Fund will terminate and final payment of
the Certificates will be made upon presentation and surrender of the
Certificates at the office of the Trustee therein designated, (ii) the amount of
any such final payment, (iii) that no interest shall accrue in respect of the
Certificates from and after the Interest Accrual Period relating to the final
Distribution Date therefor and (iv) that the Record Date otherwise applicable to
such Distribution Date is not applicable, payments being made only upon
presentation and surrender of the Certificates at the office of the Trustee. In
the event such notice is given in connection with the purchase of all of the
Mortgage Loans and each REO Property remaining in REMIC I by the Master
Servicer, the Master Servicer shall deliver to the Trustee for deposit in the
Distribution Account not later than the last Business Day of the month next
preceding the month in which such distribution will be made an amount in
immediately available funds equal to the Termination Price. Upon certification
to the Trustee by a Servicing Officer of the making of such final deposit, the
Trustee shall promptly release or cause to be released to the Master Servicer
the Mortgage Files for the remaining Mortgage Loans, and the Trustee shall
execute all assignments, endorsements and other instruments delivered to it
which are necessary to effectuate such transfer.

               (d) Upon presentation of the Certificates by the
Certificateholders on the final Distribution Date, the Trustee shall distribute
to each Certificateholder so presenting and surrendering its Certificates the
amount otherwise distributable on such Distribution Date in accordance with
Section 4.01 in respect of the Certificates so presented and surrendered. Any
funds not distributed to any Holder or Holders of Certificates being retired on
such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates shall, on such date, be set aside and held in trust by
the Trustee and credited to the account of the appropriate non-tendering Holder
or Holders. If any Certificates as to which notice has been given pursuant to
this Section 9.01 shall not have been surrendered for cancellation within six
months after the time specified in such notice, the Trustee shall mail a second
notice to the remaining non-tendering Certificateholders to surrender their
Certificates for cancellation in order to receive the final distribution with
respect thereto. If within one year after the second notice all such
Certificates shall not have been surrendered for cancellation, the Trustee
shall, directly or through an agent, mail a final notice to remaining related
non-tendering Certificateholders concerning surrender of their Certificates. The
costs and expenses of maintaining the funds in trust and of contacting such
Certificateholders shall be paid out of the assets remaining in the trust funds.
If within one year after the final notice any such Certificates shall not have
been surrendered for cancellation, the Trustee shall pay to Salomon Smith Barney
Inc. all such amounts, and all rights of non-tendering Certificateholders in or
to such amounts shall thereupon cease. No interest shall accrue or be payable to
any Certificateholder on any amount held in trust by the Trustee as a result of
such Certificateholder's failure to surrender its Certificate(s) for final
payment thereof in accordance with this Section 9.01.

               Immediately following the deposit of funds in trust hereunder in
respect of the Certificates, the Trust Fund shall terminate.



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               SECTION 9.02           Additional Termination Requirements.

               (a) In the event that the Master Servicer purchases all the
Mortgage Loans and each REO Property, the Trust Fund shall be terminated in
accordance with the following additional requirements (or in connection with the
final payment on or other liquidation of the last Mortgage Loan or REO Property
remaining in REMIC I, the additional requirement specified in clause (i) below):

                     (i) The Trust Administrator shall specify the first day in
               the 90-day liquidation period in a statement attached to REMIC
               I's final Tax Return pursuant to Treasury regulation Section
               1.860F-1, and such termination shall satisfy all requirements of
               a qualified liquidation under Section 860F of the Code and any
               regulations thereunder, as evidenced by an Opinion of Counsel
               obtained at the expense of the Master Servicer;

                    (ii) During such 90-day liquidation period, and at or prior
               to the time of making of the final payment on the Certificates,
               the Trustee shall sell all of the assets of REMIC I to the Master
               Servicer for cash; and

                   (iii) At the time of the making of the final payment on the
               Certificates, the Trustee shall distribute or credit, or cause to
               be distributed or credited, to the Holders of the Residual
               Certificates all cash on hand in REMIC I (other than cash
               retained to meet claims), and the Trust Fund shall terminate at
               that time.

               (b) At the expense of the Master Servicer (or in the event of
termination under Section 9.01(a)(ii), at the expense of the Trust
Administrator), the Trust Administrator shall prepare or cause to be prepared
the documentation required in connection with the adoption of a plan of
liquidation of REMIC I pursuant to this Section 9.02.

               (c) By their acceptance of Certificates, the Holders thereof
hereby agree to authorize the Trust Administrator to specify the 90-day
liquidation period for REMIC I, which authorization shall be binding upon all
successor Certificateholders.


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                                    ARTICLE X

                                REMIC PROVISIONS

               SECTION 10.01.         REMIC Administration.

               (a) The Trustee shall elect to treat REMIC I as a REMIC under the
Code and, if necessary, under applicable state law. Such election will be made
by the Trust Administrator on behalf of the Trustee on Form 1066 or other
appropriate federal tax or information return or any appropriate state return
for the taxable year ending on the last day of the calendar year in which the
Certificates are issued. For the purposes of the REMIC election in respect of
REMIC I, the Certificates (other than the Class R-I Certificates) shall be
designated as the Regular Interests in REMIC I and the Class R-I Certificates
shall be designated as the Residual Interests in REMIC I. The Trustee shall not
permit the creation of any "interests" in REMIC I (within the meaning of Section
860G of the Code) other than the Certificates and the interests represented by
the Certificates.

               (b) The Closing Date is hereby designated as the "Startup Day" of
REMIC I within the meaning of Section 860G(a)(9) of the Code.

               (c) The Trust Administrator shall pay out of its own funds,
without any right of reimbursement, any and all expenses relating to any tax
audit of the Trust Fund (including, but not limited to, any professional fees or
any administrative or judicial proceedings with respect to REMIC I that involve
the Internal Revenue Service or state tax authorities), other than the expense
of obtaining any tax related Opinion of Counsel except as specified herein. The
Trust Administrator, as agent for REMIC I's tax matters person, shall (i) act on
behalf of the Trust Fund in relation to any tax matter or controversy involving
REMIC I and (ii) represent the Trust Fund in any administrative or judicial
proceeding relating to an examination or audit by any governmental taxing
authority with respect thereto. The holder of the largest Percentage Interest of
the Residual Certificates shall be designated, in the manner provided under
Treasury regulations section 1.860F-4(d) and Treasury regulations section
301.6231(a)(7)-1, as the tax matters person of the REMIC created hereunder. By
its acceptance thereof, the holder of the largest Percentage Interest of the
Residual Certificates hereby agrees to irrevocably appoint the Trust
Administrator or an Affiliate as its agent to perform all of the duties of the
tax matters person for the Trust Fund.

               (d) The Trust Administrator shall prepare and the Trustee shall
sign and the Trust Administrator shall file all of the Tax Returns in respect of
the REMIC created hereunder. The expenses of preparing and filing such returns
shall be borne by the Trust Administrator without any right of reimbursement
therefor. The Master Servicer shall provide on a timely basis to the Trust
Administrator or its designee such information with respect to the assets of the
Trust Fund as is in its possession and reasonably required by the Trust
Administrator to enable it to perform its obligations under this Article.

               (e) The Trust Administrator shall perform on behalf of REMIC I
all reporting and other tax compliance duties that are the responsibility of the
REMIC under the Code, the REMIC Provisions or other compliance guidance issued
by the Internal Revenue Service or any state or local


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taxing authority including the filing of Form 8811 with the Internal Revenue
Service within 30 days following the Closing Date. Among its other duties, as
required by the Code, the REMIC Provisions or other such compliance guidance,
the Trust Administrator shall provide (i) to any Transferor of a Residual
Certificate such information as is necessary for the application of any tax
relating to the transfer of a Residual Certificate to any Person who is not a
Permitted Transferee, (ii) to the Certificateholders such information or reports
as are required by the Code or the REMIC Provisions including reports relating
to interest, original issue discount and market discount or premium (using the
Prepayment Assumption as required) and (iii) to the Internal Revenue Service the
name, title, address and telephone number of the person who will serve as the
representative of REMIC I. The Master Servicer shall provide on a timely basis
to the Trust Administrator such information with respect to the assets of the
Trust Fund, including, without limitation, the Mortgage Loans, as is in its
possession and reasonably required by the Trust Administrator to enable it to
perform its obligations under this subsection. In addition, the Depositor shall
provide or cause to be provided to the Trust Administrator, within ten (10) days
after the Closing Date, all information or data that the Trust Administrator
reasonably determines to be relevant for tax purposes as to the valuations and
issue prices of the Certificates, including, without limitation, the price,
yield, prepayment assumption and projected cash flow of the Certificates.

               (f) The Master Servicer, the Trustee and the Trust Administrator
shall take such action and shall cause REMIC I to take such action as shall be
necessary to create or maintain the status thereof as a REMIC under the REMIC
Provisions. The Master Servicer, the Trustee and the Trust Administrator shall
not take any action, cause the Trust Fund to take any action or fail to take (or
fail to cause to be taken) any action that, under the REMIC Provisions, if taken
or not taken, as the case may be, could (i) endanger the status of REMIC I as a
REMIC or (ii) result in the imposition of a tax upon the Trust Fund (including
but not limited to the tax on prohibited transactions as defined in Section
860F(a)(2) of the Code and the tax on contributions to a REMIC set forth in
Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event")
unless the Trustee and the Trust Administrator have received an Opinion of
Counsel, addressed to the Trustee and the Trust Administrator (at the expense of
the party seeking to take such action but in no event at the expense of the
Trust Administrator or the Trustee) to the effect that the contemplated action
will not, with respect to REMIC I, endanger such status or result in the
imposition of such a tax, nor shall the Master Servicer take or fail to take any
action (whether or not authorized hereunder) as to which the Trustee or the
Trust Administrator has advised it in writing that it has received an Opinion of
Counsel to the effect that an Adverse REMIC Event could occur with respect to
such action. In addition, prior to taking any action with respect to REMIC I or
its assets, or causing REMIC I to take any action, which is not contemplated
under the terms of this Agreement, the Master Servicer will consult with the
Trustee and the Trust Administrator or their designee, in writing, with respect
to whether such action could cause an Adverse REMIC Event to occur with respect
to REMIC I, and the Master Servicer shall not take any such action or cause
REMIC I to take any such action as to which the Trustee or the Trust
Administrator has advised it in writing that an Adverse REMIC Event could occur.
The Trust Administrator and the Trustee may consult with counsel to make such
written advice, and the cost of same shall be borne by the party seeking to take
the action not permitted by this Agreement, but in no event shall such cost be
an expense of the Trustee or the Trust Administrator. At all times as may be
required by the Code, the Trust Administrator, the Trustee or the Master
Servicer will ensure that substantially all of the assets of REMIC I will
consist of


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"qualified mortgages" as defined in Section 860G(a)(3) of the Code and
"permitted investments" as defined in Section 860G(a)(5) of the Code.

               (g) In the event that any tax is imposed on "prohibited
transactions" of the REMIC created hereunder as defined in Section 860F(a)(2) of
the Code, on the "net income from foreclosure property" of the REMIC as defined
in Section 860G(c) of the Code, on any contributions to the REMIC after the
Startup Day therefor pursuant to Section 860G(d) of the Code, or any other tax
is imposed by the Code or any applicable provisions of state or local tax laws,
such tax shall be charged (i) to the Trust Administrator pursuant to Section
10.03 hereof, if such tax arises out of or results from a breach by the Trust
Administrator of any of its obligations under this Article X, (ii) to the
Trustee pursuant to Section 10.03 hereof, if such tax arises out of or results
from a breach by the Trustee of any of its obligations under this Article X,
(iii) to the Master Servicer pursuant to Section 10.03 hereof, if such tax
arises out of or results from a breach by the Master Servicer of any of its
obligations under Article III or this Article X, or otherwise (iv) against
amounts on deposit in the Distribution Account and shall be paid by withdrawal
therefrom.

               (h) On or before April 15 of each calendar year, commencing April
15, 2002, the Trust Administrator shall deliver to the Master Servicer, the
Trustee and the Rating Agencies a Certificate from a Responsible Officer of the
Trust Administrator stating the Trust Administrator's compliance with this
Article X.

               (i) The Trust Administrator shall, for federal income tax
purposes, maintain books and records with respect to REMIC I on a calendar year
and on an accrual basis.

               (j) Following the Startup Day, the Master Servicer, the Trustee
and the Trust Administrator shall not accept any contributions of assets to
REMIC I other than in connection with any Qualified Substitute Mortgage Loan
delivered in accordance with Section 2.03 unless it shall have received an
Opinion of Counsel to the effect that the inclusion of such assets in the Trust
Fund will not cause the REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding or subject the REMIC to any tax under the REMIC
Provisions or other applicable provisions of federal, state and local law or
ordinances.

               (k) None of the Trustee, the Trust Administrator or the Master
Servicer shall enter into any arrangement by which REMIC I will receive a fee or
other compensation for services nor permit either such REMIC to receive any
income from assets other than "qualified mortgages" as defined in Section
860G(a)(3) of the Code or "permitted investments" as defined in Section
860G(a)(5) of the Code.

               SECTION 10.02.         Prohibited Transactions and Activities.

               None of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee shall sell, dispose of or substitute for any of the
Mortgage Loans (except in connection with (i) the foreclosure of a Mortgage
Loan, including but not limited to, the acquisition or sale of a Mortgaged
Property acquired by deed in lieu of foreclosure, (ii) the bankruptcy of REMIC
I, (iii) the termination of REMIC I pursuant to Article IX of this Agreement,
(iv) a substitution pursuant to Article II of this Agreement or (v) a purchase
of Mortgage Loans pursuant to Article II or III of this Agreement), nor


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<PAGE>



acquire any assets for REMIC I (other than REO Property acquired in respect of a
defaulted Mortgage Loan), nor sell or dispose of any investments in the
Collection Account or the Distribution Account for gain, nor accept any
contributions to REMIC I after the Closing Date (other than a Qualified
Substitute Mortgage Loan delivered in accordance with Section 2.03), unless it
has received an Opinion of Counsel, addressed to the Trustee and the Trust
Administrator (at the expense of the party seeking to cause such sale,
disposition, substitution, acquisition or contribution but in no event at the
expense of the Trustee or the Trust Administrator) that such sale, disposition,
substitution, acquisition or contribution will not (a) affect adversely the
status of REMIC I as a REMIC or (b) cause REMIC I to be subject to a tax on
"prohibited transactions" or "contributions" pursuant to the REMIC Provisions.

               SECTION 10.03.         Master Servicer and Trust Administrator
                                      Indemnification.

               (a) The Trust Administrator agrees to indemnify the Trust Fund,
the Depositor, the Master Servicer and the Trustee for any taxes and costs
including, without limitation, any reasonable attorneys fees imposed on or
incurred by the Trust Fund, the Depositor, the Master Servicer or the Trustee as
a result of a breach of the Trust Administrator's covenants set forth in this
Article X.

               (b) The Master Servicer agrees to indemnify the Trust Fund, the
Depositor, the Trust Administrator and the Trustee for any taxes and costs
including, without limitation, any reasonable attorneys' fees imposed on or
incurred by the Trust Fund, the Depositor, the Trust Administrator or the
Trustee, as a result of a breach of the Master Servicer's covenants set forth in
Article III or this Article X.




                                       111

<PAGE>



                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

               SECTION 11.01.         Amendment.

                This Agreement may be amended from time to time by the
Depositor, the Master Servicer, the Trustee and the Trust Administrator without
the consent of any of the Certificateholders, (i) to cure any ambiguity or
defect, (ii) to correct, modify or supplement any provisions herein (including
to give effect to the expectations of Certificateholders) or (iii) to make any
other provisions with respect to matters or questions arising under this
Agreement which shall not be inconsistent with the provisions of this Agreement,
provided that such action shall not, as evidenced by an Opinion of Counsel
delivered to the Trustee, adversely affect in any material respect the interests
of any Certificateholder. No amendment shall be deemed to adversely affect in
any material respect the interests of any Certificateholder who shall have
consented thereto, and no Opinion of Counsel shall be required to address the
effect of any such amendment on any such consenting Certificateholder.

        This Agreement may also be amended from time to time by the Depositor,
the Master Servicer, the Trust Administrator and the Trustee with the consent of
the Holders of Certificates entitled to at least 66% of the Voting Rights for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Agreement or of modifying in any manner the rights
of the Holders of Certificates; provided, however, that no such amendment shall
(i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii)
adversely affect in any material respect the interests of the Holders of any
Class of Certificates in a manner, other than as described in (i), without the
consent of the Holders of Certificates of such Class evidencing at least 66% of
the Voting Rights allocated to such Class, or (iii) modify the consents required
by the immediately preceding clauses (i) and (ii) without the consent of the
Holders of all Certificates then outstanding. Notwithstanding any other
provision of this Agreement, for purposes of the giving or withholding of
consents pursuant to this Section 11.01, Certificates registered in the name of
the Depositor or the Master Servicer or any Affiliate thereof shall be entitled
to Voting Rights with respect to matters affecting such Certificates.

               Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel to the effect that such amendment will
not result in the imposition of any tax on REMIC I pursuant to the REMIC
Provisions or cause REMIC I to fail to qualify as a REMIC at any time that any
Certificates are outstanding.

               Prior to executing any amendment pursuant to this Section, the
Trustee shall be entitled to receive an Opinion of Counsel (provided by the
Person requesting such amendment) to the effect that such amendment is
authorized or permitted by this Agreement.

               Promptly after the execution of any such amendment the Trustee
shall furnish a copy of such amendment to each Certificateholder.


                                       112

<PAGE>



               It shall not be necessary for the consent of Certificateholders
under this Section 11.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.

               The cost of any Opinion of Counsel to be delivered pursuant to
this Section 11.01 shall be borne by the Person seeking the related amendment,
but in no event shall such Opinion of Counsel be an expense of the Trustee or
the Trust Administrator.

               Notwithstanding the foregoing, each of the Trustee and Trust
Administrator may, but shall not be obligated to enter into any amendment
pursuant to this Section that affects its rights, duties and immunities under
this Agreement or otherwise.

               SECTION 11.02.         Recordation of Agreement; Counterparts.

               To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Master Servicer at the expense of the Certificateholders, but
only upon direction of Certificateholders accompanied by an Opinion of Counsel
to the effect that such recordation materially and beneficially affects the
interests of the Certificateholders.

               For the purpose of facilitating the recordation of this Agreement
as herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.

               SECTION 11.03.         Limitation on Rights of
                                      Certificateholders.

               The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.

               No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of any of the
Certificates, be construed so as to constitute the Certificateholders from time
to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.



                                       113

<PAGE>



               No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless (i)
such Holder previously shall have given to the Trustee a written notice of
default and of the continuance thereof, as hereinbefore provided, and (ii) the
Holders of Certificates entitled to at least 25% of the Voting Rights shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such indemnity satisfactory to it against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 15 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. It is
understood and intended, and expressly covenanted by each Certificateholder with
every other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatsoever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the equal,
ratable and common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section, each and every Certificateholder
and the Trustee shall be entitled to such relief as can be given either at law
or in equity.

               SECTION 11.04.         Governing Law.

               This Agreement shall be construed in accordance with the laws of
the State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.

               SECTION 11.05.         Notices.

               All directions, demands and notices hereunder shall be sent (i)
via facsimile (with confirmation of receipt) or (ii) in writing and shall be
deemed to have been duly given when received if personally delivered at or
mailed by first class mail, postage prepaid, or by express delivery service or
delivered in any other manner specified herein, to (a) in the case of the
Depositor, 390 Greenwich Street, New York, New York 10013, Attention: Mortgage
Finance Group (telecopy number (212) 723-8604), or such other address or
telecopy number as may hereafter be furnished to the Master Servicer, the Trust
Administrator and the Trustee in writing by the Depositor, (b) in the case of
the Master Servicer and Trust Administrator, 15851 Clayton Road, Ballwin,
Missouri 63011, Attention: William Felts (telecopy number (636) 256-5433), or
such other address or telecopy number as may hereafter be furnished to the
Trustee and the Depositor in writing by the Master Servicer and Trust
Administrator and (c) in the case of the Trustee, 101 Barclay Street, 12E, New
York, New York 10286, Attention: MBS 2001-CPB1 (telecopy number (212) 815-4135),
or such other address or telecopy number as may hereafter be furnished to the
Master Servicer, the Trust Administrator and the Depositor in writing by the
Trustee. Any notice required or permitted to be given to a Certificateholder
shall be given by first class mail, postage prepaid, at the address of such
Holder as shown in the Certificate Register. Any notice so mailed within the
time prescribed in this Agreement shall be conclusively presumed to have been
duly given when mailed, whether or not the Certificateholder receives such
notice. A copy of any notice required to be telecopied hereunder also shall be
mailed to the appropriate party in the manner set forth above.



                                       114

<PAGE>



               SECTION 11.06.         Severability of Provisions.

               If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be for any reason whatsoever held invalid, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.

               SECTION 11.07.         Notice to Rating Agencies.

               The Trustee shall use its best efforts promptly to provide notice
to the Rating Agencies with respect to each of the following of which it has
actual knowledge:

               1.      Any material change or amendment to this Agreement;

               2.      The occurrence of any Master Servicer Event of Default
                       that has not been cured or waived;

               3.      The resignation or termination of the Master Servicer,
                       the Trust Administrator or the Trustee;

               4.      The repurchase or substitution of Mortgage Loans pursuant
                       to or as contemplated by Section 2.03;

               5.      The final payment to the Holders of any Class of
                       Certificates;

               6.      Any change in the location of the Collection Account or
                       the Distribution Account;

               7.      Any event that would result in the inability of the
                       Trustee, were it to succeed as Master Servicer, to make
                       advances regarding delinquent Mortgage Loans; and

               8.      The filing of any claim under the Master Servicer's
                       blanket bond and errors and omissions insurance policy
                       required by Section 3.14 or the cancellation or material
                       modification of coverage under any such instrument.

               In addition, the Trustee shall promptly furnish to the Rating
Agencies copies of each report to Certificateholders described in Section 4.02
and the Master Servicer, as required pursuant to Section 3.20 and Section 3.21,
shall promptly furnish to the Rating Agencies copies of the following:

               1.      Each annual statement as to compliance described in
                       Section 3.20; and

               2.      Each annual independent public accountants' servicing
                       report described in Section 3.21.


                                       115

<PAGE>



               Any such notice pursuant to this Section 11.07 shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by first class mail, postage prepaid, or by express delivery service
to Standard & Poor's Ratings Services, a division of the McGraw-Hill Companies,
Inc., 55 Water Street, New York, New York 10004 and to Moody's Investors
Services, 99 Church Street, New York, New York 10007, or such other addresses as
the Rating Agencies may designate in writing to the parties hereto.

               SECTION 11.08.         Article and Section References.

               All article and section references used in this Agreement, unless
otherwise provided, are to articles and sections in this Agreement.

               SECTION 11.09.         Grant of Security Interest.

               It is the express intent of the parties hereto that the
conveyance of the Mortgage Loans by the Depositor to the Trustee be, and be
construed as, a sale of the Mortgage Loans by the Depositor and not a pledge of
the Mortgage Loans by the Depositor to secure a debt or other obligation of the
Depositor. However, in the event that, notwithstanding the aforementioned intent
of the parties, the Mortgage Loans are held to be property of the Depositor,
then, (a) it is the express intent of the parties that such conveyance be deemed
a pledge of the Mortgage Loans by the Depositor to the Trustee to secure a debt
or other obligation of the Depositor and (b)(1) this Agreement shall also be
deemed to be a security agreement within the meaning of Articles 8 and 9 of the
Uniform Commercial Code as in effect from time to time in the State of New York;
(2) the conveyance provided for in Section 2.01 hereof shall be deemed to be a
grant by the Depositor to the Trustee of a security interest in all of the
Depositor's right, title and interest in and to the Mortgage Loans and all
amounts payable to the holders of the Mortgage Loans in accordance with the
terms thereof and all proceeds of the conversion, voluntary or involuntary, of
the foregoing into cash, instruments, securities or other property, including
without limitation all amounts, other than investment earnings, from time to
time held or invested in the Collection Account and the Distribution Account,
whether in the form of cash, instruments, securities or other property; (3) the
obligations secured by such security agreement shall be deemed to be all of the
Depositor's obligations under this Agreement, including the obligation to
provide to the Certificateholders the benefits of this Agreement relating to the
Mortgage Loans and the Trust Fund; and (4) notifications to persons holding such
property, and acknowledgments, receipts or confirmations from persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Trustee for the purpose of perfecting such security interest under
applicable law. Accordingly, the Depositor hereby grants to the Trustee a
security interest in the Mortgage Loans and all other property described in
clause (2) of the preceding sentence, for the purpose of securing to the Trustee
the performance by the Depositor of the obligations described in clause (3) of
the preceding sentence. Notwithstanding the foregoing, the parties hereto intend
the conveyance pursuant to Section 2.01 to be a true, absolute and unconditional
sale of the Mortgage Loans and assets constituting the Trust Fund by the
Depositor to the Trustee.




                                       116

<PAGE>




               IN WITNESS WHEREOF, the Depositor, the Master Servicer, the Trust
Administrator and the Trustee have caused their names to be signed hereto by
their respective officers thereunto duly authorized, in each case as of the day
and year first above written.


                                     SALOMON BROTHERS MORTGAGE
                                     SECURITIES VII, INC.,
                                     as Depositor


                                     By:    /s/ Matthew R. Bollo
                                            -----------------------------------
                                     Name:  Matthew R. Bollo
                                     Title: Assistant Vice President



                                     CITIMORTGAGE, INC.,
                                     as Master Servicer and Trust Administrator


                                     By:     /s/ Bradley J. Brunts
                                            -----------------------------------
                                     Name:   Bradley J. Brunts
                                     Title:  Senior Vice President




                                     THE BANK OF NEW YORK, not in its individual
                                     capacity but solely as Trustee


                                     By:     /s/ Brian C. Morro
                                            -----------------------------------
                                     Name:   Brian Morro
                                     Title:  Assistant Treasurer








<PAGE>




STATE OF NEW YORK   )
                    ) ss.:
COUNTY OF NEW YORK  )



               On the __th day of May 2001, before me, a notary public in and
for said State, personally appeared _________________, known to me to be an
Assistant Vice President of Salomon Brothers Mortgage Securities VII, Inc., one
of the corporations that executed the within instrument, and also known to me to
be the person who executed it on behalf of said corporation, and acknowledged to
me that such corporation executed the within instrument.

               IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.




                                             ___________________________________
                                                         Notary Public

[Notarial Seal]



<PAGE>





STATE OF ______________  )
                         ) ss.:
COUNTY OF ___________    )



               On the __th day of May 2001, before me, a notary public in and
for said State, personally appeared ______________, known to me to be a
________________ of CitiMortgage, Inc., one of the corporations that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.

               IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.




                                        _________________________________
                                                  Notary Public

[Notarial Seal]



<PAGE>



STATE OF ____________    )
                         ) ss.:
COUNTY OF ___________    )



               On the __th day of May 2001, before me, a notary public in and
for said State, personally appeared ______________, known to me to be a
_______________ of The Bank of New York, one of the entities that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such entity executed the
within instrument.

               IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.




                                        _________________________________
                                                  Notary Public

[Notarial Seal]

<PAGE>

                                   EXHIBIT A-1


                           FORM OF CLASS A CERTIFICATE

     SOLELY FOR U.S.  FEDERAL INCOME TAX PURPOSES,  THIS CERTIFICATE IS A
     "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE  INVESTMENT  CONDUIT",
     AS THOSE TERMS ARE DEFINED,  RESPECTIVELY, IN SECTIONS 860G AND 860D
     OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").


Series 2001-CPB1, Class A                  Aggregate Certificate Principal
                                           Balance of Class A Certificates as of
                                           the Issue Date: $472,835,000.00
Pass-Through Rate: Variable
                                           Denomination: $472,835,000.00

Date of Agreement and Cut-off Date:        Master Servicer and Trust
May 1, 2001                                Administrator: CitiMortgage, Inc.

                                           Trustee: The Bank of Ne York
First Distribution Date: June 25, 2001
                                           Issue Date: May 30, 2001

No. 1                                      CUSIP: 79549A FL 8

       DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
       THIS  CERTIFICATE  MAY  BE  MADE  MONTHLY  AS  SET  FORTH  HEREIN.
       ACCORDINGLY,  THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
       AT ANY  TIME  MAY BE LESS  THAN  THE  AMOUNT  SHOWN  ABOVE  AS THE
       DENOMINATION OF THIS CERTIFICATE.





                                      A-1-1

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

          This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the denomination of this Certificate by the
aggregate Certificate Principal Balance of the Class A Certificates as of the
Issue Date) in that certain beneficial ownership interest evidenced by all the
Class A Certificates in REMIC I created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Salomon Brothers
Mortgage Securities VII, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Master Servicer, the
Trust Administrator and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of the Class A Certificates on such
Distribution Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of the Class A Certificates, the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two-thirds of the aggregate initial Certificate
Principal Balance of the Class A Certificates, or otherwise by check mailed by
first class mail to the address of the Person entitled thereto, as such name and
address shall appear on the


                                      A-1-2

<PAGE>



Certificate Register. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon the presentation and surrender of this Certificate at
the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other


                                      A-1-3

<PAGE>



governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans
remaining therein. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from REMIC I all the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining therein at a
price determined as provided in the Agreement. The exercise of such right will
effect early retirement of the Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Loans and all
property acquired in respect of such Mortgage Loans at the time of purchase
being less than 10% of the aggregate Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-1-4

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                    Authorized Officer




                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class A Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                    Authorized Signatory



                                      A-1-5

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address: _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-1-6

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


     The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
______________________________, account number ____________________, or, if
mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by ____________________________________, the
assignee named above, or _______________________________________, as its agent.



                                      A-1-7

<PAGE>



                                   EXHIBIT A-2

                          FORM OF CLASS B-1 CERTIFICATE

       SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
       "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT",
       AS THOSE TERMS ARE  DEFINED,  RESPECTIVELY,  IN SECTIONS  860G AND
       860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").

       THIS CERTIFICATE IS SUBORDINATE TO THE SENIOR  CERTIFICATES TO THE
       EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.

       NO TRANSFER OF THIS  CERTIFICATE  TO AN EMPLOYEE  BENEFIT  PLAN OR
       OTHER  RETIREMENT  ARRANGEMENT  (EACH  A  "PLAN")  SUBJECT  TO THE
       EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF  1974,  AS  AMENDED
       ("ERISA"),  OR THE CODE WILL BE  REGISTERED  EXCEPT IN  COMPLIANCE
       WITH THE PROCEDURES DESCRIBED HEREIN.

Series 2001-CPB1, Class B-1               Aggregate Certificate Principal
                                          Balance of Class B-1 Certificates as
                                          of the Issue Date: $4,874,000.00
Pass-Through Rate: Variable
                                          Denomination: $4,874,000.00

Date of Agreement and Cut-off Date:       Master Servicer and Trust
May 1, 2001                               Administrator: CitiMortgage, Inc.

                                          Trustee: The Bank of New York
First Distribution Date: June 25, 2001
                                          Issue Date: May 30, 2001

No. 1                                     CUSIP: 79549A FM 6



       DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
       THIS  CERTIFICATE  MAY  BE  MADE  MONTHLY  AS  SET  FORTH  HEREIN.
       ACCORDINGLY,  THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
       AT ANY  TIME  MAY BE LESS  THAN  THE  AMOUNT  SHOWN  ABOVE  AS THE
       DENOMINATION OF THIS CERTIFICATE.


                                      A-2-1

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

     This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the denomination of this Certificate by the
aggregate Certificate Principal Balance of the Class B-1 Certificates as of the
Issue Date) in that certain beneficial ownership interest evidenced by all the
Class B-1 Certificates in REMIC I created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Salomon Brothers
Mortgage Securities VII, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Master Servicer, the
Trust Administrator and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-1 Certificates on such Distribution
Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class B-1 Certificates, the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two- thirds of the aggregate initial
Certificate Principal Balance of the Class B-1 Certificates, or


                                      A-2-2

<PAGE>



otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon the presentation and surrender of this Certificate at
the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.



                                      A-2-3

<PAGE>



          No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(c) of the Agreement.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans
remaining therein. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from REMIC I all the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining therein at a
price determined as provided in the Agreement. The exercise of such right will
effect early retirement of the Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Loans and all
property acquired in respect of such Mortgage Loans at the time of purchase
being less than 10% of the aggregate Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-2-4

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Officer




                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class B-1 Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Signatory



                                      A-2-5

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address:  _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-2-6

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


     The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
_______________________________________, account number _____________________,
or, if mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by _____________________________________, the
assignee named above, or _______________________________________, as its agent.





                                      A-2-7

<PAGE>



                                   EXHIBIT A-3

                          FORM OF CLASS B-2 CERTIFICATE

       SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
       "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT",
       AS THOSE TERMS ARE  DEFINED,  RESPECTIVELY,  IN SECTIONS  860G AND
       860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").

       THIS CERTIFICATE IS SUBORDINATE TO THE SENIOR CERTIFICATES AND THE
       CLASS B-1  CERTIFICATES  TO THE EXTENT  DESCRIBED IN THE AGREEMENT
       REFERRED TO HEREIN.

       NO TRANSFER OF THIS  CERTIFICATE  TO AN EMPLOYEE  BENEFIT  PLAN OR
       OTHER  RETIREMENT  ARRANGEMENT  (EACH  A  "PLAN")  SUBJECT  TO THE
       EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF  1974,  AS  AMENDED
       ("ERISA"),  OR THE CODE WILL BE  REGISTERED  EXCEPT IN  COMPLIANCE
       WITH THE PROCEDURES DESCRIBED HEREIN.


                                      A-3-1

<PAGE>



Series 2001-CPB1, Class B-2               Aggregate Certificate Principal
                                          Balance of Class B-2 Certificates as
                                          of the Issue Date: $2,437,000.00
Pass-Through Rate: Variable

                                          Denomination: $2,437,000.00
Date of Agreement and Cut-off Date:
May 1, 2001                               Master Servicer and Trust
                                          Administrator: CitiMortgage, Inc.

First Distribution Date: June 25, 2001
                                          Trustee: The Bank of New York

No. 1
                                          Issue Date: May 30, 2001

                                          CUSIP: 79549A FN 4



       DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
       THIS  CERTIFICATE  MAY  BE  MADE  MONTHLY  AS  SET  FORTH  HEREIN.
       ACCORDINGLY,  THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
       AT ANY  TIME  MAY BE LESS  THAN  THE  AMOUNT  SHOWN  ABOVE  AS THE
       DENOMINATION OF THIS CERTIFICATE.


                                      A-3-2

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

          This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the denomination of this Certificate by the
aggregate Certificate Principal Balance of the Class B-2 Certificates as of the
Issue Date) in that certain beneficial ownership interest evidenced by all the
Class B-2 Certificates in REMIC I created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Salomon Brothers
Mortgage Securities VII, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Master Servicer, the
Trust Administrator and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month of such distribution (the "Record Date"), in an amount equal
to the product of the Percentage Interest evidenced by this Certificate and the
amount required to be distributed to the Holders of Class B-2 Certificates on
such Distribution Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class B-2 Certificates, the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two- thirds of the aggregate initial
Certificate Principal Balance of the Class B-2 Certificates, or otherwise by
check mailed by first class mail to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon the presentation and surrender of this Certificate at the office or
agency appointed by the Trustee for that purpose as provided in the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class B-2 Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class B-2 Certificates specified on the
face hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.



                                      A-3-3

<PAGE>



          No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(c) of the Agreement.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans
remaining therein. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from REMIC I all the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining therein at a
price determined as provided in the Agreement. The exercise of such right will
effect early retirement of the Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Loans and all
property acquired in respect of such Mortgage Loans at the time of purchase
being less than 10% of the aggregate Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-3-4

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Officer




                         CERTIFICATE OF AUTHENTICATION
                         -----------------------------

          This is one of the Class B-2 Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Signatory



                                      A-3-5

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address: _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-3-6

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


     The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
_______________________________________, account number _____________________,
or, if mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by _______________________________________,
the assignee named above, or _______________________________, as its agent.





                                      A-3-7

<PAGE>



                                   EXHIBIT A-4

                          FORM OF CLASS B-3 CERTIFICATE

       SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
       "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT",
       AS THOSE TERMS ARE  DEFINED,  RESPECTIVELY,  IN SECTIONS  860G AND
       860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").

       THIS  CERTIFICATE IS SUBORDINATE TO THE SENIOR  CERTIFICATES,  THE
       CLASS  B-1  CERTIFICATES  AND THE CLASS B- 2  CERTIFICATES  TO THE
       EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.

       NO TRANSFER OF THIS  CERTIFICATE  TO AN EMPLOYEE  BENEFIT  PLAN OR
       OTHER  RETIREMENT  ARRANGEMENT  (EACH  A  "PLAN")  SUBJECT  TO THE
       EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF  1974,  AS  AMENDED
       ("ERISA"),  OR THE CODE WILL BE  REGISTERED  EXCEPT IN  COMPLIANCE
       WITH THE PROCEDURES DESCRIBED HEREIN.




                                      A-4-1

<PAGE>



Series 2001-CPB1, Class B-3               Aggregate Certificate Principal
                                          Balance of Class B-3 Certificates as
                                          of the Issue Date: $2,438,000.00
Pass-Through Rate: Variable

                                          Denomination: $2,438,000.00
Date of Agreement and Cut-off Date:
May 1, 2001                               Master Servicer and Trust
                                          Administrator: CitiMortgage, Inc.

First Distribution Date: June 25, 2001
                                          Trustee: The Bank of New York

No. 1
                                          Issue Date: May 30, 2001


                                          CUSIP: 79549A FP 9


       DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
       THIS  CERTIFICATE  MAY  BE  MADE  MONTHLY  AS  SET  FORTH  HEREIN.
       ACCORDINGLY,  THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
       AT ANY  TIME  MAY BE LESS  THAN  THE  AMOUNT  SHOWN  ABOVE  AS THE
       DENOMINATION OF THIS CERTIFICATE.


                                      A-4-2

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

          This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the denomination of this Certificate by the
aggregate Certificate Principal Balance of the Class B-3 Certificates as of the
Issue Date) in that certain beneficial ownership interest evidenced by all the
Class B-3 Certificates in REMIC I created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Salomon Brothers
Mortgage Securities VII, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Master Servicer, the
Trust Administrator and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-3 Certificates on such Distribution
Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class B-3 Certificates, the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two- thirds of the aggregate initial
Certificate Principal Balance of the Class B-3 Certificates, or


                                      A-4-3

<PAGE>



otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon the presentation and surrender of this Certificate at
the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.



                                      A-4-4

<PAGE>



          No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(c) of the Agreement.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans
remaining therein. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from REMIC I all the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining therein at a
price determined as provided in the Agreement. The exercise of such right will
effect early retirement of the Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Loans and all
property acquired in respect of such Mortgage Loans at the time of purchase
being less than 10% of the aggregate Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-4-5

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Officer




                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class B-3 Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Signatory



                                      A-4-6

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address: _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-4-7

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


     The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
_______________________________________, account number ______________________,
or, if mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by _____________________________________, the
assignee named above, or _______________________________________, as its agent.





                                      A-4-8

<PAGE>



                                   EXHIBIT A-5

                          FORM OF CLASS B-4 CERTIFICATE

       SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
       "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT",
       AS THOSE TERMS ARE  DEFINED,  RESPECTIVELY,  IN SECTIONS  860G AND
       860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").

       THIS  CERTIFICATE IS SUBORDINATE TO THE SENIOR  CERTIFICATES,  THE
       CLASS B-1  CERTIFICATES,  THE CLASS B-2 CERTIFICATES AND THE CLASS
       B-3 CERTIFICATES TO THE EXTENT DESCRIBED IN THE AGREEMENT REFERRED
       TO HEREIN.

       THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
       SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF ANY
       STATE AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED
       PURSUANT  TO SUCH  ACT AND  LAWS  OR IS  SOLD  OR  TRANSFERRED  IN
       TRANSACTIONS THAT ARE EXEMPT FROM REGISTRATION  UNDER SUCH ACT AND
       UNDER  APPLICABLE  STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH
       THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT.

       NO TRANSFER OF THIS  CERTIFICATE  TO AN EMPLOYEE  BENEFIT  PLAN OR
       OTHER  RETIREMENT  ARRANGEMENT  (EACH  A  "PLAN")  SUBJECT  TO THE
       EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF  1974,  AS  AMENDED
       ("ERISA"),  OR THE CODE WILL BE  REGISTERED  EXCEPT IN  COMPLIANCE
       WITH THE PROCEDURES DESCRIBED HEREIN.



                                      A-5-1

<PAGE>




Series 2001-CPB1, Class B-4               Aggregate Certificate Principal
                                          Balance of Class B-4 Certificates as
                                          of the Issue Date: $1,706,000.00
Pass-Through Rate: Variable
                                          Denomination: $1,706,000.00

Date of Agreement and Cut-off Date:       Master Servicer and Trust
May 1, 2001                               Administrator: CitiMortgage, Inc.


First Distribution Date: June 25, 2001    Trustee: The Bank of New York


No. 1                                     Issue Date: May 30, 2001



       DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
       THIS  CERTIFICATE  MAY  BE  MADE  MONTHLY  AS  SET  FORTH  HEREIN.
       ACCORDINGLY,  THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
       AT ANY  TIME  MAY BE LESS  THAN  THE  AMOUNT  SHOWN  ABOVE  AS THE
       DENOMINATION OF THIS CERTIFICATE.


                                      A-5-2

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

          This certifies that Salomon Smith Barney Inc. is the registered owner
of a Percentage Interest (obtained by dividing the denomination of this
Certificate by the aggregate Certificate Principal Balance of the Class B-4
Certificates as of the Issue Date) in that certain beneficial ownership interest
evidenced by all the Class B-4 Certificates in REMIC I created pursuant to a
Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among Salomon Brothers Mortgage Securities VII, Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Master Servicer, the Trust Administrator and the Trustee, a summary of certain
of the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on Record Date, in an amount equal to the product of
the Percentage Interest evidenced by this Certificate and the amount required to
be distributed to the Holders of Class B-4 Certificates on such Distribution
Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class B-4 Certificates, the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two- thirds of the aggregate initial
Certificate Principal Balance of the Class B-4 Certificates, or


                                      A-5-3

<PAGE>



otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon the presentation and surrender of this Certificate at
the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.



                                      A-5-4

<PAGE>



          No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification (other than in connection with the initial
transfer of any such Certificate by the Depositor to an affiliate of the
Depositor), the Trustee shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder's prospective transferee, substantially in the
forms attached to the Agreement as Exhibit F-1, and (ii) in all other cases, an
Opinion of Counsel satisfactory to it that such transfer may be made without
such registration or qualification (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Trustee, the Trust
Administrator or the Master Servicer in their respective capacities as such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based, if any. Neither of the
Depositor nor the Trustee is obligated to register or qualify the Class of
Certificates specified on the face hereof under the 1933 Act or any other
securities law or to take any action not otherwise required under the Agreement
to permit the transfer of such Certificates without registration or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Trust
Administrator and the Master Servicer against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.

          No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(c) of the Agreement.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all


                                      A-5-5

<PAGE>



property acquired in respect of such Mortgage Loans remaining therein. The
Agreement permits, but does not require, the party designated in the Agreement
to purchase from REMIC I all the Mortgage Loans and all property acquired in
respect of any Mortgage Loan remaining therein at a price determined as provided
in the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Loans and all property acquired in respect of
such Mortgage Loans at the time of purchase being less than 10% of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-5-6

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Officer




                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class B-4 Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Signatory



                                      A-5-7

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address: _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-5-8

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


     The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
_______________________________________, account number ______________________,
or, if mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by _____________________________________, the
assignee named above, or _______________________________________, as its agent.





                                      A-5-9

<PAGE>



                                   EXHIBIT A-6

                          FORM OF CLASS B-5 CERTIFICATE

       SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
       "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT",
       AS THOSE TERMS ARE  DEFINED,  RESPECTIVELY,  IN SECTIONS  860G AND
       860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").

       THIS  CERTIFICATE IS SUBORDINATE TO THE SENIOR  CERTIFICATES,  THE
       CLASS B-1 CERTIFICATES,  THE CLASS B-2 CERTIFICATES, THE CLASS B-3
       CERTIFICATES  AND  THE  CLASS  B- 4  CERTIFICATES  TO  THE  EXTENT
       DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.

       THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
       SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF ANY
       STATE AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED
       PURSUANT  TO SUCH  ACT AND  LAWS  OR IS  SOLD  OR  TRANSFERRED  IN
       TRANSACTIONS THAT ARE EXEMPT FROM REGISTRATION  UNDER SUCH ACT AND
       UNDER  APPLICABLE  STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH
       THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT.

       NO TRANSFER OF THIS  CERTIFICATE  TO AN EMPLOYEE  BENEFIT  PLAN OR
       OTHER  RETIREMENT  ARRANGEMENT  (EACH  A  "PLAN")  SUBJECT  TO THE
       EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF  1974,  AS  AMENDED
       ("ERISA"),  OR THE CODE WILL BE  REGISTERED  EXCEPT IN  COMPLIANCE
       WITH THE PROCEDURES DESCRIBED HEREIN.



                                      A-6-1

<PAGE>




Series 2001-CPB1, Class B-5                Aggregate Certificate Principal
                                           Balance of Class B-5 Certificates as
                                           of the Issue Date: $1,462,000.00
Pass-Through Rate: Variable
                                           Denomination: $1,462,000.00

Date of Agreement and Cut-off Date:        Master Servicer and Trust
May 1, 2001                                Administrator: CitiMortgage, Inc.


First Distribution Date: June 25, 2001     Trustee: The Bank of New York

No. 1
                                           Issue Date: May 30, 2001



       DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
       THIS  CERTIFICATE  MAY  BE  MADE  MONTHLY  AS  SET  FORTH  HEREIN.
       ACCORDINGLY,  THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
       AT ANY  TIME  MAY BE LESS  THAN  THE  AMOUNT  SHOWN  ABOVE  AS THE
       DENOMINATION OF THIS CERTIFICATE.


                                      A-6-2

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

          This certifies that Salomon Smith Barney Inc. is the registered owner
of a Percentage Interest (obtained by dividing the denomination of this
Certificate by the aggregate Certificate Principal Balance of the Class B-5
Certificates as of the Issue Date) in that certain beneficial ownership interest
evidenced by all the Class B-5 Certificates in REMIC I created pursuant to a
Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among Salomon Brothers Mortgage Securities VII, Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Master Servicer, the Trust Administrator and the Trustee, a summary of certain
of the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-5 Certificates on such Distribution
Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class B-5 Certificates, the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two- thirds of the aggregate initial
Certificate Principal Balance of the Class B-5 Certificates, or


                                      A-6-3

<PAGE>



otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon the presentation and surrender of this Certificate at
the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.



                                      A-6-4

<PAGE>



          No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee shall require receipt of (i) if such
transfer is purportedly being made in reliance upon Rule 144A under the 1933
Act, written certifications from the Holder of the Certificate desiring to
effect the transfer, and from such Holder's prospective transferee,
substantially in the forms attached to the Agreement as Exhibit F-1, and (ii) in
all other cases, an Opinion of Counsel satisfactory to it that such transfer may
be made without such registration or qualification (which Opinion of Counsel
shall not be an expense of the Trust Fund or of the Depositor, the Trustee, the
Trust Administrator or the Master Servicer in their respective capacities as
such), together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor or
the Trustee is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities law or
to take any action not otherwise required under the Agreement to permit the
transfer of such Certificates without registration or qualification. Any Holder
desiring to effect a transfer of this Certificate shall be required to indemnify
the Trustee, the Depositor, the Trust Administrator and the Master Servicer
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.

          No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(c) of the Agreement.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans
remaining therein. The Agreement permits,


                                      A-6-5

<PAGE>



but does not require, the party designated in the Agreement to purchase from
REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan remaining therein at a price determined as provided in the
Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Loans and all property acquired in respect of
such Mortgage Loans at the time of purchase being less than 10% of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-6-6

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Officer




                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class B-5 Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Signatory



                                      A-6-7

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address: _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-6-8

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


     The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
_______________________________________, account number _____________________,
or, if mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by _____________________________________, the
assignee named above, or _______________________________________, as its agent.





                                      A-6-9

<PAGE>



                                   EXHIBIT A-7

                          FORM OF CLASS B-6 CERTIFICATE

       SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
       "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT",
       AS THOSE TERMS ARE  DEFINED,  RESPECTIVELY,  IN SECTIONS  860G AND
       860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").

       THIS  CERTIFICATE IS SUBORDINATE TO THE SENIOR  CERTIFICATES,  THE
       CLASS B-1 CERTIFICATES,  THE CLASS B-2 CERTIFICATES, THE CLASS B-3
       CERTIFICATES,  THE  CLASS  B-4  CERTIFICATES  AND  THE  CLASS  B-5
       CERTIFICATES TO THE EXTENT DESCRIBED IN THE AGREEMENT  REFERRED TO
       HEREIN.

       THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
       SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF ANY
       STATE AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED
       PURSUANT  TO SUCH  ACT AND  LAWS  OR IS  SOLD  OR  TRANSFERRED  IN
       TRANSACTIONS THAT ARE EXEMPT FROM REGISTRATION  UNDER SUCH ACT AND
       UNDER  APPLICABLE  STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH
       THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT.

       NO TRANSFER OF THIS  CERTIFICATE  TO AN EMPLOYEE  BENEFIT  PLAN OR
       OTHER  RETIREMENT  ARRANGEMENT  (EACH  A  "PLAN")  SUBJECT  TO THE
       EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF  1974,  AS  AMENDED
       ("ERISA"),  OR THE CODE WILL BE  REGISTERED  EXCEPT IN  COMPLIANCE
       WITH THE PROCEDURES DESCRIBED HEREIN.



                                      A-7-1

<PAGE>




Series 2001-CPB1, Class B-6                Aggregate Certificate Principal
                                           Balance of Class B-6 Certificates as
                                           of the Issue Date: $1,706,812.08
Pass-Through Rate: Variable
                                           Denomination: $1,706,812.08

Date of Agreement and Cut-off Date:        Master Servicer and Trust
May 1, 2001                                Administrator: CitiMortgage, Inc.


First Distribution Date: June 25, 2001     Trustee: The Bank of New York

No. 1
                                           Issue Date: May 30, 2001


       DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
       THIS  CERTIFICATE  MAY  BE  MADE  MONTHLY  AS  SET  FORTH  HEREIN.
       ACCORDINGLY,  THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
       AT ANY  TIME  MAY BE LESS  THAN  THE  AMOUNT  SHOWN  ABOVE  AS THE
       DENOMINATION OF THIS CERTIFICATE.


                                      A-7-2

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

          This certifies that Salomon Smith Barney Inc. is the registered owner
of a Percentage Interest (obtained by dividing the denomination of this
Certificate by the aggregate Certificate Principal Balance of the Class B-6
Certificates as of the Issue Date) in that certain beneficial ownership interest
evidenced by all the Class B-6 Certificates in REMIC II created pursuant to a
Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among Salomon Brothers Mortgage Securities VII, Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Master Servicer, the Trust Administrator and the Trustee, a summary of certain
of the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B6 Certificates on such Distribution
Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Class B-6 Certificates, the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two- thirds of the aggregate initial
Certificate Principal Balance of the Class B-6 Certificates, or


                                      A-7-3

<PAGE>



otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon the presentation and surrender of this Certificate at
the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.



                                      A-7-4

<PAGE>



          No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee shall require receipt of (i) if such
transfer is purportedly being made in reliance upon Rule 144A under the 1933
Act, written certifications from the Holder of the Certificate desiring to
effect the transfer, and from such Holder's prospective transferee,
substantially in the forms attached to the Agreement as Exhibit F-1, and (ii) in
all other cases, an Opinion of Counsel satisfactory to it that such transfer may
be made without such registration or qualification (which Opinion of Counsel
shall not be an expense of the Trust Fund or of the Depositor, the Trustee, the
Trust Administrator or the Master Servicer in their respective capacities as
such), together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor or
the Trustee is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities law or
to take any action not otherwise required under the Agreement to permit the
transfer of such Certificates without registration or qualification. Any Holder
desiring to effect a transfer of this Certificate shall be required to indemnify
the Trustee, the Depositor, the Trust Administrator and the Master Servicer
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.

          No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(c) of the Agreement.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans
remaining therein. The Agreement permits,


                                      A-7-5

<PAGE>



but does not require, the party designated in the Agreement to purchase from
REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan remaining therein at a price determined as provided in the
Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Loans and all property acquired in respect of
such Mortgage Loans at the time of purchase being less than 10% of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-7-6

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Officer




                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class B-6 Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Signatory



                                      A-7-7

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address: _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-7-8

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


     The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
_______________________________________, account number _______________________,
or, if mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by _______________________________________,
the assignee named above, or _______________________________________, as its
agent.



                                      A-7-9

<PAGE>



                                   EXHIBIT A-8


                          FORM OF CLASS R-I CERTIFICATE

       THIS  CERTIFICATE  MAY NOT BE TRANSFERRED  TO A NON-UNITED  STATES
       PERSON.

       SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
       "RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT"
       ("REMIC"), AS THOSE TERMS ARE DEFINED,  RESPECTIVELY,  IN SECTIONS
       860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").

       ANY RESALE,  TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY
       BE MADE ONLY IN ACCORDANCE  WITH THE PROVISIONS OF SECTION 5.02 OF
       THE AGREEMENT REFERRED TO HEREIN.

       THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
       SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF ANY
       STATE AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED
       PURSUANT  TO SUCH  ACT AND  LAWS  OR IS  SOLD  OR  TRANSFERRED  IN
       TRANSACTIONS THAT ARE EXEMPT FROM REGISTRATION  UNDER SUCH ACT AND
       UNDER  APPLICABLE  STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH
       THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT.

       NO TRANSFER OF THIS  CERTIFICATE  TO AN EMPLOYEE  BENEFIT  PLAN OR
       OTHER  RETIREMENT  ARRANGEMENT  (EACH  A  "PLAN")  SUBJECT  TO THE
       EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF  1974,  AS  AMENDED
       ("ERISA"),  OR THE CODE WILL BE  REGISTERED  EXCEPT IN  COMPLIANCE
       WITH THE PROCEDURES DESCRIBED HEREIN.

       ANY RESALE,  TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY
       BE MADE ONLY IF THE PROPOSED  TRANSFEREE PROVIDES (I) AN AFFIDAVIT
       TO THE  TRUSTEE  THAT (A) SUCH  TRANSFEREE  IS NOT (1) THE  UNITED
       STATES  OR  ANY  POSSESSION   THEREOF,   ANY  STATE  OR  POLITICAL
       SUBDIVISION  THEREOF,  ANY FOREIGN  GOVERNMENT,  ANY INTERNATIONAL
       ORGANIZATION,  OR  ANY  AGENCY  OR  INSTRUMENTALITY  OF ANY OF THE
       FOREGOING,   (2)  ANY  ORGANIZATION   (OTHER  THAN  A  COOPERATIVE
       DESCRIBED  IN SECTION 521 OF THE CODE) THAT IS EXEMPT FROM THE TAX
       IMPOSED BY CHAPTER 1 OF THE


                                      A-8-1

<PAGE>



       CODE  UNLESS  SUCH  ORGANIZATION  IS SUBJECT TO THE TAX IMPOSED BY
       SECTION 511 OF THE CODE, (3) ANY ORGANIZATION DESCRIBED IN SECTION
       1381(A)(2)(C)  OF THE  CODE  (ANY  SUCH  PERSON  DESCRIBED  IN THE
       FOREGOING CLAUSES (1), (2) OR (3) SHALL HEREINAFTER BE REFERRED TO
       AS  A   "DISQUALIFIED   ORGANIZATION")   OR  (4)  AN  AGENT  OF  A
       DISQUALIFIED  ORGANIZATION  AND (B) NO PURPOSE OF SUCH TRANSFER IS
       TO IMPEDE  THE  ASSESSMENT  OR  COLLECTION  OF TAX,  AND (II) SUCH
       TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE
       FINANCIAL  CONDITION OF THE PROPOSED  TRANSFEREE.  NOTWITHSTANDING
       THE REGISTRATION IN THE CERTIFICATE REGISTER OF ANY TRANSFER, SALE
       OR  OTHER  DISPOSITION  OF  THIS  CERTIFICATE  TO  A  DISQUALIFIED
       ORGANIZATION  OR AN AGENT  OF A  DISQUALIFIED  ORGANIZATION,  SUCH
       REGISTRATION  SHALL BE  DEEMED  TO BE OF NO LEGAL  FORCE OR EFFECT
       WHATSOEVER   AND  SUCH  PERSON   SHALL  NOT  BE  DEEMED  TO  BE  A
       CERTIFICATEHOLDER  FOR ANY PURPOSE HEREUNDER,  INCLUDING,  BUT NOT
       LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH
       HOLDER OF THIS CERTIFICATE BY ACCEPTANCE HEREOF SHALL BE DEEMED TO
       HAVE  CONSENTED  TO THE  PROVISIONS  OF  THIS  PARAGRAPH  AND  THE
       PROVISIONS OF SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN.
       ANY PERSON THAT IS A DISQUALIFIED  ORGANIZATION IS PROHIBITED FROM
       ACQUIRING BENEFICIAL OWNERSHIP OF THIS CERTIFICATE.

Series 2001-CPB1, Class R-I                Aggregate Percentage Interest of
                                           Class R-I Certificates as of the
                                           Issue Date: 100.00%

Date of Agreement and Cut-off Date:
May 1, 2001                                Master Servicer and Trust
                                           Administrator: CitiMortgage, Inc.
First Distribution Date: June 25, 2001

                                           Trustee: The Bank of New York
No. 1

                                           Issue Date: May 30, 2001



                                      A-8-2

<PAGE>



                        MORTGAGE PASS-THROUGH CERTIFICATE

evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional, one- to four-family,
adjustable-rate mortgage loans secured by first liens on residential real
properties and, in the case of certain of the mortgage loans, an interest in
shares issued by a cooperative apartment corporation and the related proprietary
lease (the "Mortgage Loans") formed and sold by

                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.

       THIS  CERTIFICATE  DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
       IN SALOMON  BROTHERS  MORTGAGE  SECURITIES  VII,  INC., THE MASTER
       SERVICER,  THE TRUST  ADMINISTRATOR,  THE  TRUSTEE OR ANY OF THEIR
       RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
       MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR  INSTRUMENTALITY OF
       THE UNITED STATES.

          This certifies that CitiMortgage, Inc. is the registered owner of a
100% Percentage Interest in that certain beneficial ownership interest evidenced
by all the Class R-I Certificates in REMIC I created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Salomon
Brothers Mortgage Securities VII, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), the Master
Servicer, the Trust Administrator and the Trustee, a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.

          Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class R-I Certificates on such Distribution
Date pursuant to the Agreement.

          All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon the presentation and surrender


                                      A-8-3

<PAGE>



of this Certificate at the office or agency appointed by the Trustee for that
purpose as provided in the Agreement.

          This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series specified on the
face hereof (hereinafter called the "Certificates") and representing a
Percentage Interest in the Class of Certificates specified on the face hereof
equal to the denomination specified on the face hereof divided by the aggregate
Certificate Principal Balance of the Class of Certificates specified on the face
hereof.

          The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to Holders
of the Certificates, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.

          The Agreement permits, with certain exceptions and conditions provided
therein, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Trust Administrator and
the Trustee and the rights of the Holders of the Certificates under the
Agreement at any time by the Depositor, the Master Servicer, the Trust
Administrator and the Trustee, with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations set
forth therein, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.

          The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations set forth therein, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.

          No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that


                                      A-8-4

<PAGE>



such a transfer of this Certificate is to be made without registration or
qualification, the Trustee shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder's prospective transferee, substantially in the
forms attached to the Agreement as Exhibit F-1, and (ii) in all other cases, an
Opinion of Counsel satisfactory to it that such transfer may be made without
such registration or qualification (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Trustee, the Trust
Administrator or the Master Servicer in their respective capacities as such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor or
the Trustee is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities law or
to take any action not otherwise required under the Agreement to permit the
transfer of such Certificates without registration or qualification. Any Holder
desiring to effect a transfer of this Certificate shall be required to indemnify
the Trustee, the Depositor, the Trust Administrator and the Master Servicer
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.

          No transfer of this Certificate to a Plan subject to ERISA or Section
4975 of the Code, any Person acting, directly or indirectly, on behalf of any
such Plan or any person using Plan Assets to acquire this Certificate shall be
made except in accordance with Section 5.02(c) of the Agreement.

          Prior to registration of any transfer, sale or other disposition of
this Certificate, the proposed transferee shall provide to the Trustee (i) an
affidavit to the effect that (A) such transferee is any Person other than a
Disqualified Organization or the agent (including a broker, nominee or
middleman) of a Disqualified Organization, (B) the Class R-I Certificates have
been designated as a residual interest in a REMIC, (C) it will include in its
income a PRO RATA share of the net income of the Trust Fund and that such income
may be an "excess inclusion," as defined in the Code, that, with certain
exceptions, cannot be offset by other losses or benefits from any tax exemption,
and (D) it expects to have the financial means to satisfy all of its tax
obligations including those relating to holding the Class R-I Certificates.
Notwithstanding the registration in the Certificate Register of any transfer,
sale or other disposition of this Certificate to a Disqualified Organization or
an agent (including a broker, nominee or middleman) of a Disqualified
Organization, such registration shall be deemed to be of no legal force or
effect whatsoever and such Person shall not be deemed to be a Certificateholder
for any purpose, including, but not limited to, the receipt of distributions in
respect of this Certificate.

          The Holder of this Certificate, by its acceptance hereof, shall be
deemed to have consented to the provisions of Section 5.02 of the Agreement and
to any amendment of the Agreement deemed necessary by counsel of the Depositor
to ensure that the transfer of this Certificate to any Person other than a
Permitted Transferee or any other Person will not cause the Trust Fund to cease
to qualify as a REMIC or cause the imposition of a tax upon the REMIC.

          No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other


                                      A-8-5

<PAGE>



governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.

          The Depositor, the Master Servicer, the Trust Administrator, the
Trustee and any agent of the Depositor, the Master Servicer, the Trust
Administrator or the Trustee may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and none of the Depositor,
the Master Servicer, the Trust Administrator, the Trustee nor any such agent
shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment (or provision for payment) to the Holders
of the Certificates of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the final payment or other liquidation (or any advance with respect thereto)
of the last Mortgage Loan or property acquired in respect of such Mortgage Loans
remaining in REMIC I, and (ii) the purchase by the party designated in the
Agreement at a price determined as provided in the Agreement from REMIC I of all
the Mortgage Loans and all property acquired in respect of such Mortgage Loans
remaining therein. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from REMIC I all the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining therein at a
price determined as provided in the Agreement. The exercise of such right will
effect early retirement of the Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Loans and all
property acquired in respect of such Mortgage Loans at the time of purchase
being less than 10% of the aggregate Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date.

          The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.

          Unless the certificate of authentication hereon has been executed by
the Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.


                                      A-8-6

<PAGE>



          IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.

Dated:  May 30, 2001

                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Officer




                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

          This is one of the Class R-I Certificates referred to in the
within-mentioned Agreement.


                                           THE BANK OF NEW YORK,
                                           as Trustee


                                           By: ________________________________
                                                     Authorized Signatory



                                      A-8-7

<PAGE>



                                  ABBREVIATIONS
                                  -------------

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common           UNIF GIFT MIN ACT - Custodian
                                                             --------------
                                                             (Cust)  (Minor)
TEN ENT - as tenants by the entireties                       under Uniform Gifts
                                                             to Minors Act
JT TEN  - as joint tenants with right                 _________________
            of survivorship and not as                     (State)
            tenants in common

    Additional abbreviations may also be used though not in the above list.



                                   ASSIGNMENT
                                   ----------


     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)

the Percentage Interest evidenced by the within Mortgage Pass-Through
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.

     I (we) further direct the Trustee to issue a new Certificate of a like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address: _________________________________________
_______________________________________________________________________________.

Dated:

                                      _______________________________________
                                      Signature by or on behalf of assignor


                                      _______________________________________
                                      Signature Guaranteed




                                      A-8-8

<PAGE>



                            DISTRIBUTION INSTRUCTIONS
                            -------------------------


        The assignee should include the following for purposes of distribution:

     Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _______________________________________, for the account of
_______________________________________, account number _______________________,
or, if mailed by check, to _______________________________________. Applicable
statements should be mailed to _______________________________________.

     This information is provided by _____________________________________, the
assignee named above, or _______________________________________, as its agent.





                                      A-8-9

<PAGE>



                                    EXHIBIT B


                                   [RESERVED]




                                       B-1

<PAGE>



                                    EXHIBIT C

                                   [RESERVED]




                                       C-1

<PAGE>



                                    EXHIBIT D


                    FORM OF MORTGAGE LOAN PURCHASE AGREEMENT




                                       D-1

<PAGE>

                        MORTGAGE LOAN PURCHASE AGREEMENT

                   This is a Mortgage Loan Purchase Agreement (the "Agreement"),
dated May 24, 2001, between Salomon Brothers Mortgage Securities VII, Inc., a
Delaware corporation (the "Purchaser") and CitiMortgage, Inc., a Delaware
corporation (the "Seller").

                              PRELIMINARY STATEMENT

                   The Seller intends to sell the Mortgage Loans (as hereinafter
defined) on a servicing retained basis to the Purchaser on the terms and subject
to the conditions set forth in this Agreement. The Purchaser intends to deposit
the Mortgage Loans into a mortgage pool comprising the trust fund. The trust
fund will be evidenced by a single series of mortgage pass-through certificates
designated as Series 2001-CPB1 (the"Certificates"). The Certificates will
consist of eight classes of certificates. The Certificates will be issued
pursuant to a Pooling and Servicing Agreement, dated as of May 1, 2001 (the
"Pooling and Servicing Agreement"), among the Purchaser as depositor, the Seller
as master servicer (the "Master Servicer") and The Bank of New York as trustee
(the "Trustee"). Capitalized terms used but not defined herein shall have the
meanings set forth in the Pooling and Servicing Agreement.

                   The parties hereto agree as follows:

                   SECTION 1. AGREEMENT TO PURCHASE. The Seller agrees to sell,
and the Purchaser agrees to purchase, on or before May 30, 2001 (the "Closing
Date"), certain adjustable-rate, conventional residential mortgage loans (the
"Mortgage Loans") on a servicing retained basis, having an aggregate principal
balance as of the close of business on May 1, 2001 (the "Cut-off Date") of
approximately $487,458,812 (the "Closing Balance"), after giving effect to all
payments due on the Mortgage Loans on or before the Cut-off Date, whether or not
received.

                   SECTION 2. MORTGAGE LOAN SCHEDULE. The Purchaser and the
Seller have agreed upon which of the mortgage loans owned by the Seller are to
be purchased by the Purchaser pursuant to this Agreement and the Seller will
prepare or cause to be prepared on or prior to the Closing Date a final schedule
(the "Closing Schedule") that together shall describe such Mortgage Loans and
set forth all of the Mortgage Loans to be purchased under this Agreement. The
Closing Schedule will conform to the requirements set forth in this Agreement
and to the definition of "Mortgage Loan Schedule" under the Pooling and
Servicing Agreement. The Closing Schedule shall be used as the Mortgage Loan
Schedule under the Pooling and Servicing Agreement.

                   SECTION 3. CONSIDERATION.

                            (a) In consideration for the Mortgage Loans to be
purchased hereunder, the Purchaser shall, as described in Section 8, pay to or
upon the order of the Seller in immediately available funds an amount (the
"Purchase Price") equal to the net sale proceeds of the Certificates (which
amount is net of fees and expenses of Salomon Smith Barney, Inc.), plus accrued
interest.

                            (b) The Purchaser or any assignee, transferee or
designee of the Purchaser shall be entitled to all scheduled payments of
principal due after the Cut-off Date, all other payments



<PAGE>


                                       -2-


of principal due and collected after the Cut-off Date, and all payments of
interest on the Mortgage Loans allocable to the period after the Cut-off Date.
All scheduled payments of principal and interest due on or before the Cut-off
Date and collected after the Cut-off Date shall belong to the Seller.

                            (c) Pursuant to the Pooling and Servicing Agreement,
the Purchaser will assign all of its right, title and interest in and to the
Mortgage Loans, together with its rights under this Agreement, to the Trustee
for the benefit of the related Certificateholders.

                   SECTION 4. TRANSFER OF THE MORTGAGE LOANS.

                            (a) POSSESSION OF MORTGAGE FILES. The Seller does
hereby sell, transfer, assign, set over and convey to the Purchaser, without
recourse but subject to the terms of this Agreement, all of its right, title and
interest in, to and under the Mortgage Loans. The contents of each Mortgage File
not delivered to the Purchaser or to any assignee, transferee or designee of the
Purchaser on or prior to the Closing Date are and shall be held in trust by the
Seller for the benefit of the Purchaser or any assignee, transferee or designee
of the Purchaser. Upon the sale of the Mortgage Loans the ownership of each
Mortgage Note, the related Mortgage and the other contents of the related
Mortgage File is vested in the Purchaser and the ownership of all records and
documents with respect to the related Mortgage Loan prepared by or that come
into the possession of the Seller on or after the Closing Date shall immediately
vest in the Purchaser and shall be delivered as soon as practicable to the
Purchaser or as otherwise directed by the Purchaser.

                            (b) DELIVERY OF MORTGAGE LOAN DOCUMENTS. In
connection with such transfer and assignment, the Seller does hereby deliver to,
and deposit with, the Purchaser or the Purchaser's designee, the documents or
instruments set forth in Section 2.01 of the Pooling and Servicing Agreement.

               To the extent not already recorded, the Seller shall promptly
(and in no event later than five Business Days following the later of the
Closing Date and the date of receipt by the Seller of the recording information
for a Mortgage) submit or cause to be submitted for recording, at no expense to
the Purchaser, in the appropriate public office for real property records, each
Assignment delivered to it pursuant to the Pooling and Servicing Agreement and
shall promptly submit or cause to be submitted for filing, the Form UCC-3
assignment and the UCC-1 financing statement referred to in the Pooling and
Servicing Agreement. In the event that any such Assignment, Form UCC-3 or Form
UCC-1, as applicable, is lost or returned unrecorded because of a defect
therein, the Seller shall promptly prepare or cause to be prepared a substitute
Assignment, Form UCC-3 or Form UCC- 1, as applicable, or cure or cause to be
cured such defect, as the case may be, and thereafter cause each such Assignment
to be duly recorded. Notwithstanding the foregoing, the Seller need not cause to
be recorded any Assignment which relates to a Mortgage Loan in any jurisdiction
under the laws of which, as evidenced by an Opinion of Counsel delivered or
caused to be delivered by the Seller to the Trustee and the Rating Agencies, the
recordation of such assignment is not necessary to protect the Purchaser's
interest in the related Mortgage Loan; PROVIDED, HOWEVER, notwithstanding the
delivery of any Opinion of Counsel, the Seller shall submit each Assignment for
recording, at no expense to the Trust Fund or Trustee, upon the earliest to
occur of: (i) reasonable direction by



<PAGE>


                                       -3-


Holders of Certificates entitled to at least 25% of the Voting Rights, (ii) the
occurrence of a Master Servicer Event of Termination, (iii) the occurrence of a
bankruptcy, insolvency or foreclosure relating to the Seller, (iv) the
occurrence of a servicing transfer as described in Section 7.02 of the Pooling
and Servicing Agreement and (v) with respect to any one Assignment the
occurrence of a foreclosure relating to the Mortgagor under the related
Mortgage. Notwithstanding the foregoing, if the Seller fails to pay the cost of
recording the Assignments, such expense will be paid by the Trustee and the
Trustee shall be reimbursed for such expenses by the Trust as set forth in the
Pooling and Servicing Agreement.

               With respect to a maximum of approximately 1.00% of the Original
Mortgage Loans, by outstanding principal balance of the Original Mortgage Loans
as of the Cut-off Date, if any original Mortgage Note referred to in the Pooling
and Servicing Agreement cannot be located, the obligations of the Seller to
deliver such documents shall be deemed to be satisfied upon delivery to the
Purchaser of a photocopy of such Mortgage Note, if available, with a lost note
affidavit. If any of the original Mortgage Notes for which a lost note affidavit
was delivered to the Purchaser is subsequently located, such original Mortgage
Note shall be delivered to the Trustee within three Business Days.

               The Seller shall deliver or cause to be delivered to the
Purchaser promptly upon receipt thereof any other original documents
constituting a part of a Mortgage File received with respect to any Mortgage
Loan, including, but not limited to, any original documents evidencing an
assumption, modification, consolidation or extension of any Mortgage Loan.

               All original documents relating to the Mortgage Loans that are
not delivered to the Purchaser are and shall be held by or on behalf of the
Seller in trust for the benefit of the Trustee on behalf of the
Certificateholders. In the event that any such original document is required
pursuant to the terms of this Section to be a part of a Mortgage File, such
document shall be delivered promptly to the Purchaser. Any such original
document delivered to or held by the Purchaser that is not required pursuant to
the terms of this Section to be a part of a Mortgage File, shall be delivered
promptly to the Seller.

                       (c) ACCEPTANCE OF MORTGAGE LOANS. The documents delivered
pursuant to Section 4(b) hereof shall be reviewed by the Purchaser or any
assignee, transferee or designee of the Purchaser at any time before or after
the Closing Date (and with respect to each document permitted to be delivered
after the Closing Date within seven days of its delivery) to ascertain that all
required documents have been executed and received and that such documents
relate to the Mortgage Loans identified on the Mortgage Loan Schedule.




<PAGE>


                                       -4-


                       (d) TRANSFER OF INTEREST IN AGREEMENTS. The Purchaser has
the right to assign its interest under this Agreement, in whole or in part, to
the Trustee, as may be required to effect the purposes of the Pooling and
Servicing Agreement, without the consent of the Seller, and the assignee shall
succeed to the rights and obligations hereunder of the Purchaser. Any expense
reasonably incurred by or on behalf of the Purchaser, the Master Servicer or the
Trustee in connection with enforcing any obligations of the Seller under this
Agreement will be promptly reimbursed by the Seller.

                       (e) EXAMINATION OF MORTGAGE FILES. Prior to the Closing
Date, the Seller shall either (i) deliver in escrow to the Purchaser or to any
assignee, transferee or designee of the Purchaser, for examination, the Mortgage
File pertaining to each Mortgage Loan, or (ii) make such Mortgage Files
available to the Purchaser or to any assignee, transferee or designee of the
Purchaser for examination; provided, however, that the Seller shall not be
required to provide mortgagor names or addresses to any such assignee,
transferee or designee. Such examination may be made by the Purchaser or the
Trustee, and their respective designees, upon reasonable notice to the Seller
during normal business hours before the Closing Date and within 60 days after
the Closing Date. If any such person makes such examination prior to the Closing
Date and identifies any Mortgage Loans that do not conform to the requirements
of the Purchaser as described in this Agreement, such Mortgage Loans shall be
deleted from the Closing Schedule. The Purchaser may, at its option and without
notice to the Seller, purchase all or part of the Mortgage Loans without
conducting any partial or complete examination. The fact that the Purchaser or
any person has conducted or has failed to conduct any partial or complete
examination of the Mortgage Files shall not affect the rights of the Purchaser
or any assignee, transferee or designee of the Purchaser to demand repurchase or
other relief as provided herein or under the Pooling and Servicing Agreement.

               SECTION 5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
                          SELLER

               (a) The Seller hereby represents and warrants, as of the date
hereof and as of the Closing Date, and covenants, that:

                       (i) The Seller is a Delaware corporation, duly organized
and validly existing and in good standing under the laws of the state of
Delaware with full corporate power and authority to conduct its business as
presently conducted by it to the extent material to the consummation of the
transactions contemplated herein. The Seller had the full corporate power and
authority to acquire the Mortgage Loans. The Seller has the full corporate power
and authority to own the Mortgage Loans and to transfer and convey the Mortgage
Loans to the Purchaser and has the full corporate power and authority to execute
and deliver, engage in the transactions contemplated by, and perform and observe
the terms and conditions of this Agreement;

                       (ii) This Agreement has been duly and validly authorized,
executed and delivered by the Seller, all requisite corporate action having been
taken, and (assuming the due authorization, execution and delivery hereof by the
Purchaser) constitutes the valid, legal and binding obligation of the Seller,
enforceable in accordance with its terms, except as such enforcement may be
limited by (A) bankruptcy, insolvency, reorganization, receivership, moratorium
or other similar



<PAGE>


                                       -5-


laws relating to or affecting the rights of creditors generally, (B) general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law) or (C) public policy considerations underlying
the securities laws, to the extent that such public policy considerations limit
the enforceability of the provisions of this Agreement which purport to provide
indemnification from securities laws liabilities;

                       (iii) No consent, approval, authorization or order of,
registration or filing with, or notice to any governmental authority or court is
required, under federal laws for the execution, delivery and performance by the
Seller of, or compliance by the Seller with, this Agreement or the consummation
by the Seller of any other transaction contemplated hereby and by the Pooling
and Servicing Agreement; provided, however, that the Seller makes no
representation or warranty regarding federal or state securities laws in
connection with the sale or distribution of the Certificates;

                       (iv) No certificate of an officer, statement or other
information furnished in writing or report delivered by the Seller to the
Purchaser, any affiliate of the Purchaser or the Trustee for use in connection
with the purchase of the Mortgage Loans and the transactions contemplated
hereunder and under the Pooling and Servicing Agreement will contain any untrue
statement of a material fact, or omit a material fact necessary to make the
information, certificate, statement or report not misleading in any material
respect.

                       (v) Neither the sale of the Mortgage Loans to the
Purchaser, nor the execution, delivery or performance of this Agreement by the
Seller, conflicts or will conflict with or results or will result in a breach of
or constitutes or will constitute a default (or an event, which with notice or
lapse of time or both, would constitute a default) under (A) any terms or
provisions of the certificate of incorporation or by-laws of the Seller, (B) any
term or provision of any material agreement, contract, instrument or indenture,
to which the Seller is a party or by which the Seller or any of its property is
bound or (C) any law, rule, regulation, order, judgment, writ, injunction or
decree of any court or governmental authority having jurisdiction over the
Seller or any of its property, or results or will result in the creation or
imposition of any lien, charge or encumbrance which would have a material
adverse effect upon the Mortgage Loans or any documents or instruments
evidencing or securing the Mortgage Loans;

                       (vi) The Seller has not dealt with any broker, investment
banker, agent or other person, except for the Purchaser or any of its
affiliates, that may be entitled to any commission or compensation in connection
with the sale of the Mortgage Loans;

                       (vii) There is no litigation currently pending or, to the
best of the Seller's knowledge, threatened against the Seller that would
reasonably be expected to adversely affect the transfer of the Mortgage Loans,
the issuance of the Certificates, the execution, delivery, performance or
enforceability of this Agreement or that would result in a material adverse
change in the financial condition of the Seller;




<PAGE>


                                       -6-


                       (viii) Each Mortgage Note, each Mortgage, each Assignment
and any other document required to be delivered by or on behalf of the Seller
under this Agreement or the Pooling and Servicing Agreement to the Purchaser or
any assignee, transferee or designee of the Purchaser for each Mortgage Loan has
been or will be, in accordance with Section 4(b) hereof, delivered to the
Purchaser or any such assignee, transferee or designee. With respect to each
Mortgage Loan, the Seller is in possession of a complete Mortgage File in
compliance with the Pooling and Servicing Agreement, except for such documents
that (A) have been delivered (1) to the Purchaser or any assignee, transferee or
designee of the Purchaser or (2) for recording to the appropriate public
recording office and have not yet been returned or (B) are not required to be
delivered to the Purchaser or any assignee, transferee or designee of the
Purchaser until 90 days following the Closing Date or such later date as
provided in Section 4;

                       (ix) The transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Seller pursuant to this Agreement are
not subject to the bulk transfer or any similar statutory provisions in effect
in any relevant jurisdiction, except any as may have been complied with;

                       (x) The form of endorsement of each Mortgage Note
satisfied the requirement, if any, of endorsement in order to transfer all
right, title and interest of the party so endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note; and each Assignment to be delivered
hereunder is in recordable form and is sufficient to effect the assignment of
and to transfer to the assignee thereunder the benefits of the assignor, as
mortgagee or assignee thereof, under each Mortgage to which that Assignment
relates;

                       (xi) Immediately prior to the sale of the Mortgage Loans
to the Purchaser as herein contemplated, the Seller had good title to, and was
the sole owner of, the Mortgage Loans, and such sale validly transfers the
Mortgage Loans to the Purchaser free and clear of any pledge, lien, encumbrance
or security interest;

                       (xii) With respect to the Mortgage Loans, the Seller
hereby represents and warrants, as of the date hereof and as of the Closing
Date, that each Mortgage Loan constitutes a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code;

                       (xiii) The transfer of the Mortgage Loans by the Seller
was intended to be a sale and to be reported as such under United States
generally accepted accounting principles ("GAAP") and for United States federal
income tax purposes, and meets all of the requirements for such accounting and
tax treatment (except for the GAAP requirement that the Mortgage Loans have been
legally isolated from the Seller);

                       (xiv) In connection with the sale of the Mortgage Loans
by the Seller, the Seller (i) was solvent at all relevant times prior thereto
and has not been rendered insolvent thereby, (ii) after giving effect thereto,
is able to pay its debts as they mature, (iii) has not been left with
unreasonably small capital for the business in which it is engaged and proposes
to be engaged, (iv) had and has no intention of commencing any bankruptcy,
insolvency or similar proceeding, (v) did



<PAGE>


                                       -7-


not and does not have any intent to hinder, delay or defraud any of the
undersigned's creditors, (vi) had a valid business reason therefor and (vii)
received new value and consideration therefor constituting reasonably equivalent
value and adequate and fair consideration; and

                       (xv) The Seller has not acquired, and does not intend to
acquire at any time, any direct or indirect ownership or other economic interest
in, or other right or obligation with respect to, any Mortgage Loan or
Certificate, except as described in the Agreements.

               SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE SELLER RELATING
                          TO THE MORTGAGE LOANS.

               The Seller hereby represents and warrants to the Purchaser that,
as to each Mortgage Loan, as of the Closing Date (or such other date specified
herein) for such Mortgage Loan:

               (i) The information set forth in the Mortgage Loan Schedule is
complete, true and correct as of the Cut-off Date;

               (ii) To the best knowledge of the Seller, the Mortgage Loans are
in compliance with all requirements set forth on Exhibit 1, and the
characteristics of the Mortgage Loans as set forth on Exhibit 1 are true and
correct;

               (iii) (a) All payments required to be made on or before the first
day of the month prior to the month of the Closing Date, with respect to such
Mortgage Loan under the terms of the Mortgage Note have been made and (b) the
Seller has not advanced funds, or induced, solicited or knowingly received any
advance of funds from a party other than the owner of the related Mortgaged
Property, directly or indirectly, for the payment of any amount required by the
Mortgage Note or Mortgage;

               (iv) To the best knowledge of the Seller, there are no delinquent
taxes, ground rents, water charges, sewer rents, assessments, insurance
premiums, leasehold payments, including assessments payable in future
installments or other outstanding charges affecting the related Mortgaged
Property;

               (v) To the best knowledge of the Seller, the terms of the
Mortgage Note and (A) with respect to each Mortgage Loan, the Mortgage and (B)
with respect to each Mortgage Loan that is a Cooperative Loan, the Security
Agreement, the Cooperative Lease, the Stock Power and the Assignment of
Proprietary Lease, have not been impaired, waived, altered or modified in any
respect, except by written instruments included in the Mortgage File, recorded
in the applicable public recording office if necessary to maintain the lien
priority of the Mortgage; the substance of any such waiver, alteration or
modification has been approved by the title insurer, to the extent required by
the related policy, and is reflected on the Mortgage Loan Schedule. No
instrument of waiver, alteration or modification has been executed by the Seller
or any other person in the chain of title from the Seller, and no Mortgagor has
been released, in whole or in part, except in connection with an assumption
agreement approved by the title insurer, to the extent required by the policy,
and the



<PAGE>


                                       -8-


terms of which are reflected in the Mortgage Loan Schedule and included in the
related Mortgage File;

               (vi) Prior to the transfer to the Purchaser by the Seller, the
Mortgage Note and (A) with respect to each Mortgage Loan, the Mortgage and (B)
with respect to each Mortgage Loan that is a Cooperative Loan, the Security
Agreement, are not subject to any right of rescission, set-off, counterclaim or
defense, including the defense of usury, nor will the operation of any of the
terms of the Mortgage Note and the Mortgage, or the exercise of any right
thereunder, render the Mortgage unenforceable, in whole or in part, or subject
to any right of rescission, set-off, counterclaim or defense, including the
defense of usury and no such right of rescission, set-off, counterclaim or
defense has been asserted with respect thereto;

               (vii) To the best knowledge of the Seller, with respect to any
Mortgage Loan, all buildings upon the Mortgaged Property and with respect to any
Mortgage Loan that is a Cooperative Loan, the related Project, are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
or Project is located, pursuant to insurance policies conforming to the
requirements of the Pooling and Servicing Agreement. All such insurance policies
contain a standard mortgagee clause naming the Seller or the originator of the
related Mortgage Loan, its successors and assigns as mortgagee and all premiums
thereon have been paid. If upon origination of the Mortgage Loan, the Mortgaged
Property or Project was in an area identified on a Flood Hazard Map or Flood
Insurance Rate Map issued by the Federal Emergency Management Agency as having
special flood hazards (and such flood insurance has been made available) a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect which policy conforms to the
requirements of Fannie Mae and Freddie Mac. The Mortgage obligates the Mortgagor
thereunder to maintain all such insurance at the Mortgagor's cost and expense,
and on the Mortgagor's failure to do so, authorizes the holder of the Mortgage
to maintain such insurance at the Mortgagor's cost and expense and to seek
reimbursement therefor from the Mortgagor;

               (viii) To the best knowledge of the Seller, any and all
requirements of any federal, state or local law including, without limitation,
usury, truth in lending, real estate settlement procedures, consumer credit
protection, equal credit opportunity or disclosure laws applicable to the
origination and servicing of the Mortgage Loan have been complied with;

               (ix) The Mortgage has not been satisfied, canceled, subordinated
or rescinded, in whole or in part, and the Mortgaged Property has not been
released from the lien of the Mortgage, in whole or in part, nor has any
instrument been executed that would effect any such satisfaction, cancellation,
subordination, rescission or release;

               (x) The Mortgage is a valid, existing and enforceable first lien
on the Mortgaged Property, including all improvements on the Mortgaged Property
subject only to (a) the lien of current real property taxes and assessments not
yet due and payable, (b) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of recording
being acceptable to mortgage lending institutions generally and specifically
referred to in



<PAGE>


                                       -9-


the lender's title insurance policy delivered to the originator of the Mortgage
Loan and which do not adversely affect the appraised value of the Mortgaged
Property and (c) other matters to which like properties are commonly subject
which do not materially interfere with the benefits of the security intended to
be provided by the Mortgage or the use, enjoyment, value or marketability of the
related Mortgaged Property. Any security agreement, chattel mortgage or
equivalent document related to and delivered in connection with the Mortgage
Loan establishes and creates a valid, existing and enforceable first lien and
first priority security interest on the property described therein and, as of
the time it contributed the Mortgage Loan to the Purchaser, the Seller had full
right to contribute and assign the same to the Purchaser;

               (xi) The Mortgage Note and (A) with respect to each Mortgage
Loan, the related Mortgage and (B) with respect to each Mortgage Loan that is a
Cooperative Loan, the related Security Agreement, are genuine and each is the
legal, valid and binding obligation of the maker thereof, enforceable in
accordance with its terms;

               (xii) To the best knowledge of the Seller, all parties to the
Mortgage Note and the Mortgage had legal capacity to enter into the Mortgage
Loan and to execute and deliver the Mortgage Note and the Mortgage, and the
Mortgage Note and the Mortgage have been duly and properly executed by such
parties. Except with respect to 0.85% of the Mortgage Loans, by aggregate
principal balance of the Mortgage Loans as of the Cut-off Date, the Mortgagor is
a natural person who is a party to the Mortgage Note and the Mortgage is in an
individual capacity or family trust that is guaranteed by a natural person;

               (xiii) The proceeds of the Mortgage Loan have been fully
disbursed to or for the account of the Mortgagor and there is no obligation for
the Mortgagee to advance additional funds thereunder and any and all
requirements as to completion of any on-site or off-site improvement and as to
disbursements of any escrow funds therefor have been complied with. All costs,
fees and expenses incurred in making or closing the Mortgage Loan and the
recording of the Mortgage have been paid, and the Mortgagor is not entitled to
any refund of any amounts paid or due to the Mortgagee pursuant to the Mortgage
Note or Mortgage;

               (xiv) As of the Closing Date and prior to the sale of the
Mortgage Loan to the Purchaser, the Seller was the sole legal, beneficial and
equitable owner of the Mortgage Note and (A) with respect to each Mortgage Loan,
the Mortgage and (B) with respect to each Mortgage Loan that is a Cooperative
Loan, the Security Agreement, has full right to transfer and sell the Mortgage
Loan to the Purchaser free and clear of any encumbrance, equity, lien, pledge,
charge, claim or security interest;

               (xv) To the best knowledge of the Seller, all parties which have
had any interest in (A) with respect to any Mortgage Loan, the Mortgage Loan and
(B) with respect to any Mortgage Loan that is a Cooperative Loan, the Security
Agreement, whether as mortgagee, assignee, pledgee or otherwise, are (or, during
the period in which they held and disposed of such interest, were) in compliance
with any and all applicable "doing business" and licensing requirements of the
laws of the state wherein the Mortgaged Property is located;



<PAGE>


                                      -10-


               (xvi) The Mortgage Loan is covered by either (i) an ALTA lender's
title insurance policy acceptable to Fannie Mae or Freddie Mac, issued by a
title insurer acceptable to Fannie Mae and Freddie Mac and qualified to do
business in the jurisdiction where the Mortgaged Property is located, insuring
(subject to the exceptions contained in (x)(a) and (b) above) the Seller or the
originator of the related Mortgage Loan, its successors and assigns as to the
first priority lien of the Mortgage in the original principal amount of the
Mortgage Loan or (ii) an attorney's title opinion, if customary in the related
jurisdiction where the Mortgaged Property is located. Additionally, such
lender's title insurance policy affirmatively insures ingress and egress to and
from the Mortgaged Property, and against encroachments by or upon the Mortgaged
Property or any interest therein. The Seller is the sole insured of such
lender's title insurance policy, and such lender's title insurance policy is in
full force and effect and will be in full force and effect upon the consummation
of the transactions contemplated by this Agreement. No claims have been made
under such lender's title insurance policy, and no prior holder of the related
Mortgage, including the Seller, has done, by act or omission, anything which
would impair the coverage of such lender's title insurance policy;

               (xvii) There is no default, breach, violation or event of
acceleration existing under the Mortgage or the Mortgage Note and no event
which, with the passage of time or with notice and the expiration of any grace
or cure period, would constitute a default, breach, violation or event of
acceleration, and the Seller has not waived any default, breach, violation or
event of acceleration;

               (xviii) There are no mechanics' or similar liens or claims which
have been filed for work, labor or material (and no rights are outstanding that
under law could give rise to such lien) affecting the related Mortgaged Property
which are or may be liens prior to, or equal or coordinate with, the lien of the
related Mortgage;

               (xix) All improvements which were considered in determining the
appraised value of the related Mortgaged Property lay wholly within the
boundaries and building restriction lines of the Mortgaged Property, and no
improvements on adjoining properties encroach upon the Mortgaged Property;

               (xx) The Mortgage Loan was originated by either Citibank, N.A. or
Citibank, F.S.B.;

               (xxi) Principal payments on the Mortgage Loan commenced no more
than two months after the proceeds of the Mortgage Loan were disbursed. The
Mortgage Loan bears interest at the Mortgage Rate. The Mortgage Note is payable
on the day of each month set forth in the Mortgage Loan Schedule and in Monthly
Payments which will amortize the Stated Principal Balance of the Mortgage Loan
over its remaining term at the Mortgage Rate. Interest on the Mortgage Loan is
calculated on the basis of a 360-day year consisting of twelve 30-day months.
The Mortgage Note does not permit negative amortization;

               (xxii) The origination and collection practices used by the
Seller with respect to each Mortgage Note and Mortgage have been in all respects
legal, proper, prudent and customary in the mortgage origination and servicing
industry. The Mortgage Loan has been serviced by the Master



<PAGE>


                                      -11-


Servicer (directly or through a subservicer) and any predecessor servicer in
accordance with the terms of the Mortgage Note. With respect to escrow deposits
and Escrow Payments, if any, all such payments are in the possession of, or
under the control of, the Master Servicer and there exist no deficiencies in
connection therewith for which customary arrangements for repayment thereof have
not been made. No escrow deposits or Escrow Payments or other charges or
payments due the Master Servicer have been capitalized under any Mortgage or the
related Mortgage Note;

               (xxiii) To the best knowledge of the Seller, (A) with respect to
each Mortgage Loan, the Mortgaged Property and (B) with respect to each Mortgage
Loan that is a Cooperative Loan, the related Cooperative Apartment and Project,
are free of damage and waste and there is no proceeding pending for the total or
partial condemnation thereof;

               (xxiv) The Mortgage and related Mortgage Note contain customary
and enforceable provisions such as to render the rights and remedies of the
holder thereof adequate for the realization against the Mortgaged Property of
the benefits of the security provided thereby, including, (a) in the case of a
Mortgage designated as a deed of trust, by trustee's sale and (b) otherwise by
judicial foreclosure. There is no homestead or other exemption available to the
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage. The Mortgagor has not
notified the Seller and the Seller has no knowledge of any relief requested or
allowed to the Mortgagor under the Soldiers and Sailors Civil Relief Act of
1940;

               (xxv) The Mortgage Note is not and has not been secured by any
collateral except the lien of the corresponding Mortgage on the Mortgaged
Property and the security interest of any applicable security agreement or
chattel mortgage referred to in (x) above;

               (xxvi) The Mortgage File contains an appraisal of the related
Mortgaged Property made and signed, prior to the approval of the Mortgage Loan
application, by a qualified appraiser, approved by the Seller, who had no
interest, direct or indirect in the Mortgaged Property or in any loan made on
the security thereof, whose compensation is not affected by the approval or
disapproval of the Mortgage Loan and who met the minimum qualifications of
Fannie Mae and Freddie Mac or those approved by the institution that originated
the related Mortgage Loan;

               (xxvii) In the event the Mortgage constitutes a deed of trust, a
trustee, duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in the Mortgage, and no fees or
expenses are or will become payable by the Purchaser to the trustee under the
deed of trust, except in connection with a trustee's sale after default by the
Mortgagor;

               (xxviii) No Mortgage Loan contains provisions pursuant to which
Monthly Payments are (a) paid or partially paid with funds deposited in any
separate account established by the Seller, the Mortgagor, or anyone on behalf
of the Mortgagor, (b) paid by any source other than the Mortgagor or (c)
contains any other similar provisions which may constitute a "buydown"
provision. The Mortgage Loans are not graduated payment mortgage loans and the
Mortgage Loans do not have shared appreciation or other contingent interest
features;



<PAGE>


                                      -12-


               (xxix) If the Mortgage Loan is a Refinanced Mortgage Loan, the
Mortgagor has received all disclosure and rescission materials required by
applicable law with respect to the making of a Refinanced Mortgage Loan, and
evidence of such receipt is and will remain in the Mortgage File;

               (xxx) No Mortgage Loan was made in connection with (a) the
construction or rehabilitation of a Mortgaged Property or (b) facilitating the
trade-in or exchange of a Cooperative Apartment;

               (xxxi) The Mortgage Note, the Mortgage, the Assignment and any
other documents required to be delivered with respect to each Mortgage Loan
pursuant to the Pooling and Servicing Agreement, have been delivered to the
Trustee all in compliance with the specific requirements of the Pooling and
Servicing Agreement;

               (xxxii) To the best knowledge of the Seller, the Mortgaged
Property is lawfully occupied under applicable law; all inspections, licenses
and certificates required to be made or issued with respect to all occupied
portions of the Mortgaged Property and, with respect to the use and occupancy of
the same, including but not limited to certificates of occupancy, have been made
or obtained from the appropriate authorities;

               (xxxiii) The Assignment is in recordable form and is acceptable
for recording under the laws of the jurisdiction in which the Mortgaged Property
is located;

               (xxxiv) Any principal advances made to the Mortgagor prior to the
Cut-off Date have been consolidated with the outstanding principal amount
secured by the Mortgage, and the secured principal amount, as consolidated,
bears a single interest rate and single repayment term. The lien of the Mortgage
securing the consolidated principal amount is expressly insured as having first
lien priority by a title insurance policy, an endorsement to the policy insuring
the mortgagee's consolidated interest or by other title evidence acceptable to
Fannie Mae and Freddie Mac. The consolidated principal amount does not exceed
the original principal amount of the Mortgage Loan;

               (xxxv) The Mortgage Loan was not intentionally selected by the
Seller in a manner intended to adversely affect the interest of the Purchaser;

               (xxxvi) The Seller has not dealt with any broker or agent or
other Person who might be entitled to a fee, commission or compensation in
connection with the transaction contemplated by this Agreement;

               (xxxvii) The Mortgaged Property consists of a parcel of real
property with a single family residence erected thereon, or a two to four-family
dwelling, or an individual condominium unit in a low-rise or high-rise
condominium project, a cooperative unit, or an individual unit in a planned unit
development. The Mortgaged Property is improved with a Residential Dwelling. To
the best knowledge of the Seller, the Mortgaged Property does NOT consist of
mobile homes or manufactured homes (as defined in the Fannie Mae
Originator-Servicer's Guide), except when the



<PAGE>


                                      -13-


appraisal indicates that the home is of comparable construction to a stick or
beam construction home, is readily marketable, has been permanently affixed to
the site and is not in a mobile home "park." The Mortgaged Property is either a
fee simple estate or a long-term residential lease. If the Mortgage Loan is
secured by a long-term residential lease, unless otherwise specifically
disclosed in the Mortgage Loan Schedule, (A) the terms of such lease expressly
permit the mortgaging of the leasehold estate, the assignment of the lease
without the lessor's consent (or the lessor's consent has been obtained and such
consent is the Mortgage File) and the acquisition by the holder of the Mortgage
of the rights of the lessee upon foreclosure or assignment in lieu of
foreclosure or provide the holder of the Mortgage with substantially similar
protection; (B) the terms of such lease do not (x) allow the termination thereof
upon the lessee's default without the holder of the Mortgage being entitled to
receive written notice of, and opportunity to cure, such default or (y) prohibit
the holder of the Mortgage from being insured under the hazard insurance policy
relating to the Mortgaged Property; (C) the original term of such lease is not
less than 15 years; (D) the term of such lease does not terminate earlier than
ten years after the maturity date of the Mortgage Note; and (E) the Mortgaged
Property is located in a jurisdiction in which the use of leasehold estates for
residential properties is an accepted practice;

               (xxxviii) At the time of origination, the Loan-to-Value Ratio of
any Mortgage Loan was not greater than 94.04%;

               (xxxix) The Mortgage, and if required by applicable law the
related Mortgage Note, contains a provision for the acceleration of the payment
of the unpaid principal balance of the Mortgage Loan in the event that the
Mortgaged Property is sold or transferred without the prior written consent of
the Mortgagee, at the option of the Mortgagee;

               (xl) To the best of the Seller's knowledge, except with respect
to one Mortgage Loan, each Mortgage Loan with a Loan-to-Value Ratio at
origination in excess of 80% will be insured by a primary mortgage insurance
policy (a "Primary Mortgage Insurance Policy") covering (a) at least 25% of the
Scheduled Principal Balance of the Mortgage Loan at origination if the Loan-
to-Value Ratio is between 90.01% and 95.00%, (b) at least 12% of the principal
balance if the Loan- to-Value Ratio is between 85.01% and 90.00% and (c) at
least 6% of the principal balance if the Loan-to-Value Ratio is between 80.01%
and 85.00% and each Primary Mortgage Insurance Policy insures the named insured
and its successors and assigns, and the issuer of the Primary Mortgage Insurance
Policy is an insurance company whose claims-paying ability is currently
acceptable to the Rating Agencies;

               (xli) To the best knowledge of the Seller, no error, omission,
misrepresentation, negligence, fraud or similar occurrence with respect to a
Mortgage Loan has taken place on the part of any person, including, without
limitation, the Mortgagor, any appraiser, any builder or developer, or any other
party involved in the origination of the Mortgage Loan or in the application of
any insurance in relation to such Mortgage Loan;

               (xlii) With respect to any assumption, modification,
consolidation or extension agreements, such agreement has been recorded by the
Seller if required under applicable law;



<PAGE>


                                      -14-


               (xliii) No Mortgage Loan is subject to the requirements of the
Home Ownership and Equity Protection Act of 1994 ("HOEPA") and no Mortgage Loan
is in violation of any state law or ordinance similar to HOEPA;

               (xliv) The Master Servicer for each Mortgage Loan has accurately
and fully reported its borrower credit files to each of the Credit Repositories
in a timely manner;

               (xlv) No proceeds from any Mortgage Loan were used to purchase
single premium credit insurance policies as part of the origination of, or as a
condition to closing, such Mortgage Loan;

               (xlvi)  No Mortgage Loan has a prepayment charge term;

               (xlvii) With respect to each Mortgage Loan that is a Cooperative
Loan, each Security Agreement creates a valid, enforceable and subsisting first
security interest in the collateral securing the related Mortgage Note subject
only to (a) the lien of the related Cooperative for unpaid assessments
representing the Mortgagor's PRO RATA share of the Cooperative's payments for
its blanket mortgage, current and future real property taxes, insurance
premiums, maintenance fees and other assessments to which like collateral is
commonly subject and (b) other matters to which like collateral is commonly
subject which do not materially interfere with the benefits of the security
intended to be provided by the Security Agreement; provided, however, that the
appurtenant Cooperative Lease may be subordinated or otherwise subject to the
lien of any mortgage on the Project. There are no liens against or security
interests in the collateral which have priority over the lender's security
interest in the collateral, and such priority interest cannot be created in the
future;

               (xlviii) With respect to each Mortgage Loan that is a Cooperative
Loan, all parties to the Mortgage Note and the Cooperative Loan had legal
capacity to execute and deliver the Mortgage Note, the Security Agreement, the
Cooperative Lease, the Stock Power, the Recognition Agreement, the UCC-1
Financing Statement and the Assignment of Proprietary Lease and such documents
have been duly and properly executed by such parties. Each Stock Power (i) has
all signatures guaranteed or (ii) if all signatures are not guaranteed, then
such Cooperative Stock will be transferred by the stock transfer agent of the
Cooperative if the Seller undertakes to convert the ownership of the collateral
securing the related Cooperative Loan;

               (xlix) To the best knowledge of the Seller, with respect to each
Mortgage Loan that is a Cooperative Loan, there is no default in complying with
the terms of the Mortgage Note, the Security Agreement and the Cooperative Lease
and all maintenance charges and assessments (including assessments payable in
the future installments, which previously became due and owing) have been paid.
The Seller has the right under the terms of the Mortgage Note, Security
Agreement and Recognition Agreement to pay any maintenance charges or
assessments owed by the Mortgagor;

               (l) With respect to each Mortgage Loan that is a Cooperative
Loan, a Cooperative Lien Search has been made by a company competent to make the
same which company is acceptable to Fannie Mae and qualified to do business in
the jurisdiction where the Cooperative Apartment is



<PAGE>


                                      -15-


located and each entity that holds title (fee or an acceptable leasehold estate)
to the real property and improvements constituting the Cooperative Apartment
qualifies as a "cooperative housing corporation" as defined in Section 216 of
the Internal Revenue Code of 1986;

               (li) With respect to each Mortgage Loan that is a Cooperative
Loan, (i) the terms of the related Cooperative Lease is longer than the terms of
the Cooperative Loan, (ii) there is no provision in any Cooperative Lease which
requires the Mortgagor to offer for sale the Cooperative Stock owned by such
Mortgagor first to the cooperative, (iii) there is no prohibition in any
Cooperative Lease against pledging the Cooperative Stock or assigning the
Cooperative Lease and (iv) the Recognition Agreement is on a form of agreement
published by the Aztech Document Systems, Inc. or includes provisions which are
no less favorable to the lender than those contained in such agreement; and

               (lii) With respect to each Mortgage Loan that is a Cooperative
Loan, the related Cooperative Apartment, is lawfully occupied under applicable
law; all inspections, licenses and certificates required to be made or issued
with respect to all occupied portions of the Cooperative Apartment and the
related Project and, with respect to the use and occupancy of the same,
including but not limited to certificates of occupancy, have been made or
obtained from the appropriate authorities.

               SECTION 7. REPURCHASE OBLIGATION FOR DEFECTIVE DOCUMENTATION AND
                          FOR BREACH OF REPRESENTATION AND WARRANTY.

               (a) The representations and warranties contained in Section 6
shall not be impaired by any review and examination of loan files or other
documents evidencing or relating to the Mortgage Loans or any failure on the
part of the Seller or the Purchaser to review or examine such documents and
shall inure to the benefit of any assignee, transferee or designee of the
Purchaser, including the Trustee for the benefit of holders of Mortgage
Pass-Through Certificates evidencing an interest in all or a portion of the
Mortgage Loans. With respect to the representations and warranties contained
herein which are made to the knowledge or the best of knowledge of the Seller,
or as to which the Seller has no knowledge, if it is discovered that the
substance of any such representation and warranty was inaccurate as of the date
such representation and warranty was made or deemed to be made, and such
inaccuracy materially and adversely affects the value of the related Mortgage
Loan or the interest therein of the Purchaser or the Purchaser's assignee,
transferee or designee, then notwithstanding the lack of knowledge by the Seller
with respect to the substance of such representation and warranty being
inaccurate at the time the representation and warranty was made, the Seller
shall take such action described in the following paragraph in respect of such
Mortgage Loan.

               Upon discovery by the Seller, the Purchaser or any assignee,
transferee or designee of the Purchaser of any materially defective document in,
or that any material document was not transferred by the Seller as part of any
Mortgage File or of a breach of any of the representations and warranties
contained in Section 5 or Section 6 that materially and adversely affects the
value of any Mortgage Loan, the Purchaser or the Purchaser's assignee,
transferee or designee or the party



<PAGE>


                                      -16-


discovering the breach shall give prompt written notice to the Seller. Within
ninety (90) days of its discovery or its receipt of notice of any such missing
documentation which was not transferred to the Purchaser as described above or
materially defective documentation or any breach of a representation and
warranty, the Seller promptly shall deliver such missing document or cure such
defect or breach in all material respects, or in the event the Seller cannot
deliver such missing document or such defect or breach cannot be cured, the
Seller shall within ninety (90) days of its discovery or receipt of notice,
either (i) repurchase the affected Mortgage Loan at the Purchase Price (as
defined in the Pooling and Servicing Agreement) or (ii) pursuant to the
provisions of the Pooling and Servicing Agreement, cause the removal of such
Mortgage Loan from the Trust Fund and substitute one or more Qualified
Substitute Mortgage Loans. With respect to Mortgage Loans where the Mortgage
File is missing a material document that was transferred from the Seller to the
Purchaser, the Purchaser or the Purchaser's assignee, transferee or designee,
the party discovering such breach shall give prompt written notice to the
Seller. The Seller shall amend the Closing Schedule to reflect the withdrawal of
such Mortgage Loan from the terms of this Agreement and the Pooling and
Servicing Agreement and the addition, if any, of a Qualified Substitute Mortgage
Loan. The Seller shall deliver to the Purchaser such amended Closing Schedule
and shall deliver such other documents as are required by this Agreement or the
Pooling and Servicing Agreement within five (5) days of any such amendment. Any
repurchase pursuant to this Section 7(a) shall be accomplished by deposit in the
Collection Account of the amount of the Purchase Price (as defined in the
Pooling and Servicing Agreement) in accordance with Section 2.03 of the Pooling
and Servicing Agreement. Any repurchase or substitution required by this Section
shall be made in a manner consistent with Section 2.03 of the Pooling and
Servicing Agreement.

               (b) It is understood and agreed that the obligations of the
Seller set forth in this Section 7 to cure, repurchase or substitute for a
defective Mortgage Loan constitute the sole remedies of the Purchaser against
the Seller, respecting a missing or defective document or a breach of the
representations and warranties contained in Section 5 or Section 6. It is
understood and agreed that the obligations of the Seller set forth in this
Section 7 to repurchase or substitute for a Mortgage Loan as to which a material
document is missing constitute the sole remedies of the Purchaser against the
Seller respecting a missing document.

               SECTION 8. CLOSING; PAYMENT FOR THE MORTGAGE LOANS. The closing
of the purchase and sale of the Mortgage Loans shall be held at the New York
City office of Thacher Proffitt & Wood at 10:00 AM New York City time on the
Closing Date.

               The closing shall be subject to each of the following conditions:

               (a)     All of the representations and warranties of the Seller
                       under this Agreement shall be true and correct in all
                       material respects as of the date as of which they are
                       made and no event shall have occurred which, with notice
                       or the passage of time, would constitute a default under
                       this Agreement;

               (b)     The Purchaser shall have received, or the attorneys of
                       the Purchaser shall have received in escrow (to be
                       released from escrow at the time of closing),



<PAGE>


                                      -17-


                       all Closing Documents as specified in Section 9 of this
                       Agreement, in such forms as are agreed upon and
                       acceptable to the Purchaser, duly executed by all
                       signatories other than the Purchaser as required pursuant
                       to the respective terms thereof;

               (c)     The Seller shall have delivered or caused to be delivered
                       and released to the Purchaser or to its designee, all
                       documents (including without limitation, the Mortgage
                       Loans) required to be so delivered by the Purchaser; and

               (d)     All other terms and conditions of this Agreement shall
                       have been complied with in all material respects.

               Subject to the foregoing conditions, the Purchaser shall deliver
or cause to be delivered to the Seller on the Closing Date, against delivery and
release by the Seller to the Trustee of all documents required pursuant to the
Pooling and Servicing Agreement, the consideration for the Mortgage Loans as
specified in Section 3 of this Agreement, by delivery to the Seller of the
Purchase Price.

               SECTION 9. CLOSING DOCUMENTS. Without limiting the generality of
Section 8 hereof, the closing shall be subject to delivery of each of the
following documents:

                       (a)    An Officers' Certificate of the Seller, dated the
                              Closing Date, upon which the Purchaser and Salomon
                              Smith Barney Inc. (the "Underwriter") may rely, in
                              a form acceptable to the Purchaser, and attached
                              thereto copies of the certificate of
                              incorporation, by-laws and certificate of good
                              standing of the Seller;

                       (b)    An Officers' Certificate of the Seller, dated the
                              Closing Date, upon which the Purchaser and the
                              Underwriter may rely, in a form acceptable to the
                              Purchaser, with respect to certain facts regarding
                              the sale of the Mortgage Loans by the Seller to
                              the Purchaser;

                       (c)    An Opinion of Counsel of the Seller, dated the
                              Closing Date and addressed to the Purchaser and
                              the Underwriter, in a form acceptable to the
                              Purchaser;

                       (d)    Such opinions of counsel as the Rating Agencies or
                              the Trustee may request in connection with the
                              sale of the Mortgage Loans by the Seller to the
                              Purchaser or the Seller's execution and delivery
                              of, or performance under, this Agreement;

                        (e)   A letter from KPMG, L.L.P., certified public
                              accountants, dated the date hereof and to the
                              effect that they have performed certain specified
                              procedures as a result of which they determined
                              that certain



<PAGE>


                                      -18-


                              information of an accounting, financial or
                              statistical nature set forth in the Purchaser's
                              Prospectus Supplement, dated May 24, 2001 under
                              the subheadings "Summary of Prospectus
                              Supplement--The Mortgage Loans," "Risk Factors"
                              (to the extent of information regarding the
                              Mortgage Loans therein) "The Mortgage Pool" and
                              "The Mortgage Loan Seller" agrees with the records
                              of the Seller;

                        (f)   A letter from KPMG, L.L.P., certified public
                              accountants, dated the date hereof and to the
                              effect that they have performed certain specified
                              procedures as a result of which they determined
                              that certain information of an accounting,
                              financial or statistical nature set forth in the
                              Purchaser's Prospectus Supplement, dated May 24,
                              2001 under the subheading "Pooling and Servicing
                              Agreement--The Master Servicer" agrees with the
                              records of the Master Servicer; and

                       (g)    Such further information, certificates, opinions
                              and documents as the Purchaser or the Underwriter
                              may reasonably request.

               SECTION 10. COSTS. The Seller shall pay (or shall reimburse the
Purchaser or any other Person to the extent that the Purchaser or such other
Person shall pay) all necessary and reasonable costs and expenses incurred
directly in connection with the transfer and delivery of the Mortgage Loans,
including without limitation, recording fees, fees for title policy endorsements
and continuations and the fees for recording Assignments, the costs and expenses
of printing (or otherwise reproducing) and delivering this Agreement, the
Pooling and Servicing Agreement, the Certificates, the prospectus, Prospectus
Supplement, and private placement memorandum relating to the Certificates and
other related documents, the initial fees, costs and expenses of the Trustee set
forth in an engagement letter delivered to the Seller by the Trustee, the fees
and expenses of the Depositor's counsel in connection with the preparation of
all documents relating to the securitization of the Mortgage Loans, the filing
fee charged by the Securities and Exchange Commission for registration of the
Certificates, the fees charged by any rating agency to rate the Certificates and
the ongoing expenses of the Rating Agencies. All other costs and expenses in
connection with the transactions contemplated hereunder shall be borne by the
party incurring such expense.

               SECTION 11. [Reserved].

               SECTION 12. MANDATORY DELIVERY; GRANT OF SECURITY INTEREST. The
sale and delivery on the Closing Date of the Mortgage Loans described on the
Mortgage Loan Schedule in accordance with the terms and conditions of this
Agreement is mandatory. It is specifically understood and agreed that each
Mortgage Loan is unique and identifiable on the date hereof and that an award of
money damages would be insufficient to compensate the Purchaser for the losses
and damages incurred by the Purchaser in the event of the Seller's failure to
deliver the Mortgage Loans on or before the Closing Date. The Seller hereby
grants to the Purchaser a lien on and a continuing security interest in the
Seller's interest in each Mortgage Loan and each document and instrument
evidencing each such Mortgage Loan to secure the performance by the Seller of
its obligation



<PAGE>


                                      -19-


hereunder, and the Seller agrees that it holds such Mortgage Loans in custody
for the Purchaser, subject to the Purchaser's (i) right, prior to the Closing
Date, to reject any Mortgage Loan to the extent permitted by this Agreement and
(ii) obligation to deliver or cause to be delivered the consideration for the
Mortgage Loans pursuant to Section 8 hereof. Any Mortgage Loans rejected by the
Purchaser shall concurrently therewith be released from the security interest
created hereby. The Seller agrees that, upon acceptance of the Mortgage Loans by
the Purchaser or its designee and delivery of payment to the Seller, that its
security interest in the Mortgage Loans shall be released. All rights and
remedies of the Purchaser under this Agreement are distinct from, and cumulative
with, any other rights or remedies under this Agreement or afforded by law or
equity and all such rights and remedies may be exercised concurrently,
independently or successively.

               Notwithstanding the foregoing, if on the Closing Date, either (i)
each of the conditions set forth in Section 8 hereof shall have been satisfied
and the Purchaser shall not have paid or caused to be paid the Purchase Price,
or (ii) any such condition shall not have been waived or satisfied and the
Purchaser determines not to pay or cause to be paid the Purchase Price, the
Purchaser shall immediately effect the redelivery of the Mortgage Loans, if
delivery to the Purchaser has occurred and the security interest created by this
Section 12 shall be deemed to have been released; provided, however, in the case
of any such nonpayment described in clause (i) above, such redelivery shall not
diminish any other rights or remedies that the Seller may have against the
Purchaser.

               SECTION 13. NOTICES. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered to or mailed by registered mail, postage prepaid, or
transmitted by telex or telegraph and confirmed by a similar mailed writing, if
to the Purchaser, addressed to the Purchaser at 390 Greenwich Street, New York,
New York 10013, Attention: Mortgage Finance Group, or such other address as may
hereafter be furnished to the Seller in writing by the Purchaser; if to the
Seller, addressed to the Seller at 15851 Clayton Road, Ballwin, Missouri 63011,
Attention: William Felts, or to such other address as the Seller may designate
in writing to the Purchaser.

               SECTION 14. SEVERABILITY OF PROVISIONS. Any part, provision,
representation or warranty of this Agreement which is prohibited or which is
held to be void or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof. Any part, provision, representation or warranty of this Agreement which
is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective, 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. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof.

               SECTION 15. AGREEMENT OF PARTIES. The Seller and the Purchaser
each agree to execute and deliver such instruments and take such actions as
either of the others may, from time



<PAGE>


                                      -20-


to time, reasonably request in order to effectuate the purpose and to carry out
the terms of this Agreement and the Pooling and Servicing Agreement.

               SECTION 16. SURVIVAL. The Seller agrees that the representations,
warranties and agreements made by it herein and in any certificate or other
instrument delivered pursuant hereto shall be deemed to be relied upon by the
Purchaser, notwithstanding any investigation heretofore or hereafter made by the
Purchaser or on its behalf, and that the representations, warranties and
agreements made by the Seller herein or in any such certificate or other
instrument shall survive the delivery of and payment for the Mortgage Loans and
shall continue in full force and effect, notwithstanding any restrictive or
qualified endorsement on the Mortgage Notes and notwithstanding subsequent
termination of this Agreement, the Pooling and Servicing Agreement or the Trust
Fund.

               SECTION 17. INDEMNIFICATION. (a) The Seller will indemnify and
hold harmless each of (i) the Purchaser and (ii) each person, if any, who
controls the Purchaser within the meaning of the Securities Act of 1933, as
amended (the "1933 Act") (i) through (iii) collectively, the "Indemnified
Party"), against any losses, claims, damages or liabilities to which such
Indemnified Party may become subject, under the 1933 Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon (a) any untrue statement or alleged untrue
statement of any material fact contained in the Prospectus Supplement dated May
24, 2001 (the "Prospectus Supplement"), as amended or supplemented, relating to
the public offering of the Certificates, representing interests in the Mortgage
Loans, or in any other offering document (the "Private Placement Memorandum")
relating to the offering by the Purchaser or an affiliate thereof, of the
Subordinate Certificates, or in any revision or amendment thereof or supplement
thereto, or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading in
each case to the extent and only to the extent that such untrue statement or
alleged untrue statement or omission or alleged omission relates to information
furnished by the Seller specifically for use in the Prospectus Supplement, under
the captions "Summary of Prospectus Supplement--The Mortgage Loans," "Risk
Factors"(to the extent of information regarding the Mortgage Loans therein),
"The Mortgage Pool," "Pooling and Servicing Agreement--The Master Servicer" (and
substantially identical information approved by the Seller for inclusion in the
Private Placement Memorandum relating to the Subordinate Certificates);
provided, however, that the Seller shall not indemnify the Indemnified Party to
the extent that the information contained on the collateral tape provided by the
Seller to the Purchaser or its affiliate was correct, (b) any representation,
warranty or covenant made by the Seller in this Agreement and (c) any updated
collateral information provided by the Underwriter to a purchaser of the
certificates derived from the data provided by the Seller or in the Remittance
Report or a current collateral tape obtained from the Seller or an affiliate of
the Seller, including the current loan balances of the Mortgage Loans to the
extent such information was inaccurate ((a) through (c) collectively, the
"Seller Information") and will reimburse each such Indemnified Party for any
legal or other expenses reasonably incurred by such Indemnified Party and each
such controlling person in connection with investigating or defending any such
loss, claim, damage, liability or action. The Seller's liability under this
Section 17 shall be in addition to any other liability the Seller may otherwise
have.




<PAGE>


                                      -21-


               (b) The Purchaser agrees to indemnify and hold harmless the
Seller, its officers and its directors, and each person who controls the Seller
within the meaning of the 1933 Act against any and all losses, claims, damages
or liabilities, joint or several, to which they may become subject under the
1933 Act, or other federal or state statutory law or regulation, at common law
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based in whole or in part upon any
untrue statement or alleged untrue statement of a material fact contained in the
Prospectus Supplement, the Prospectus or Private Placement Memorandum, or in any
revision or amendment thereof or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances in which they were made, not misleading, as of
the date thereof and as of the Closing Date, except insofar as such losses,
claims, damages or liabilities are caused by any untrue statement or omission or
alleged untrue statement or omission made therein in reliance upon and in
conformity with the Seller Information and will reimburse the Seller and each
such controlling person for any legal or other expenses reasonably incurred by
the Seller and each such controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action. The Purchaser's
liability under this Section 17 shall be in addition to any other liability the
Purchaser may otherwise have.

               (c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either Section 17(a) or 17(b) above, such
person (the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the reasonable fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the right
to retain its own counsel, but the reasonable fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the indemnifying
party and the indemnified party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the indemnifying party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees
and expenses of more than one separate firm for all such indemnified parties.
Such firm shall be designated in writing by the Purchaser, in the case of
parties indemnified pursuant to clause 17(a) and by the Seller, in the case of
parties indemnified pursuant to clause 17(b). The indemnifying party may, at its
option, at any time upon written notice to the indemnified party, assume the
defense of any proceeding and may designate counsel satisfactory to the
indemnified party in connection therewith provided that the counsel so
designated would have no actual or potential conflict of interest in connection
with such representation. Unless it shall assume the defense of any proceeding,
the indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. If the indemnifying



<PAGE>


                                      -22-


party assumes the defense of any proceeding, it shall be entitled to settle such
proceeding with the consent of the indemnified party or, if such settlement
provides for release of the indemnified party in connection with all matters
relating to the proceeding which have been asserted against the indemnified
party in such proceeding by the other parties to such settlement, without the
consent of the indemnified party.

               (d) If the indemnification provided for in this Section 17 is
unavailable to an indemnified party under Section 17(a) or 17(b) hereof or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities, in
such proportion as is appropriate to reflect the relative fault of the
indemnified and indemnifying parties in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative fault of the
indemnified and indemnifying parties shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by such parties and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.

               (e) The Purchaser and the Seller agree that it would not be just
and equitable if contribution pursuant to Section 17 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the considerations referred to in Section 17(d) above. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in this Section 17 shall be deemed to include, subject
to the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim, except where the indemnified party is required to bear
such expenses pursuant to this Section 17, which expenses the indemnifying party
shall pay as and when incurred, at the request of the indemnified party, to the
extent that the indemnifying party will be ultimately obligated to pay such
expenses. In the event that any expenses so paid by the indemnifying party are
subsequently determined to not be required to be borne by the indemnifying party
hereunder, the party which received such payment shall promptly refund the
amount so paid to the party which made such payment. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.

               (f) The indemnity and contribution agreements contained in this
Section 17 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by the Purchaser
or any person controlling the Purchaser or by or on behalf of the Seller and
their respective directors or officers or any person controlling the Seller and
(iii) acceptance of and payment for any of the Certificates.




<PAGE>


                                      -23-


               SECTION 18. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES,
OBLIGATIONS AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS (INCLUDING THE CHOICE OF LAW PROVISIONS)
AND DECISIONS OF THE STATE OF NEW YORK. THE PARTIES HERETO INTEND THAT THE
PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY
TO THIS AGREEMENT.

               SECTION 19. MISCELLANEOUS. This Agreement may be executed in two
or more counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns. This Agreement
supersedes all prior agreements and understandings relating to the subject
matter hereof. 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. The headings in this Agreement are for purposes of
reference only and shall not limit or otherwise affect the meaning hereof.

               It is the express intent of the parties hereto that the
conveyance of the Mortgage Loans by the Seller to the Purchaser as provided in
Section 4 hereof be, and be construed as, a sale of the Mortgage Loans by the
Seller to the Purchaser and not as a pledge of the Mortgage Loans by the Seller
to the Purchaser to secure a debt or other obligation of the Seller. However, in
the event that, notwithstanding the aforementioned intent of the parties, the
Mortgage Loans are held to be property of the Seller, then, (a) it is the
express intent of the parties that such conveyance be deemed a pledge of the
Mortgage Loans by the Seller to the Purchaser to secure a debt or other
obligation of the Seller and (b) (1) this Agreement shall also be deemed to be a
security agreement within the meaning of Articles 8 and 9 of the New York
Uniform Commercial Code; (2) the conveyance provided for in Section 4 hereof
shall be deemed to be a grant by the Seller to the Purchaser of a security
interest in all of the Seller's right, title and interest in and to the Mortgage
Loans and all amounts payable to the holders of the Mortgage Loans in accordance
with the terms thereof and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all amounts, other than investment
earnings, from time to time held or invested in the Collection Account whether
in the form of cash, instruments, securities or other property; (3) the
possession by the Purchaser or its agent of Mortgage Notes, the related
Mortgages and such other items of property that constitute instruments, money,
negotiable documents or chattel paper shall be deemed to be "possession by the
secured party" for purposes of perfecting the security interest pursuant to
Section 9-305 of the New York Uniform Commercial Code; and (4) notifications to
persons holding such property, and acknowledgments, receipts or confirmations
from persons holding such property, shall be deemed notifications to, or
acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Purchaser for the purpose of perfecting
such security interest under applicable law. Any assignment of the interest of
the Purchaser pursuant to Section 4(d) hereof shall also be deemed to be an
assignment of any security interest created hereby. The Seller and the Purchaser
shall, to the extent consistent with this Agreement, take such actions as may be
necessary to ensure that, if



<PAGE>


                                      -24-


this Agreement were deemed to create a security interest in the Mortgage Loans,
such security interest would be deemed to be a perfected security interest of
first priority under applicable law and will be maintained as such throughout
the term of this Agreement and the Pooling and Servicing Agreement.



<PAGE>


               IN WITNESS WHEREOF, the Purchaser and the Seller have caused
their names to be signed by their respective officers thereunto duly authorized
as of the date first above written.


                                             SALOMON BROTHERS MORTGAGE
                                             SECURITIES VII, INC.


                                             By:________________________________
                                             Name:
                                             Title:



                                             CITIMORTGAGE, INC.


                                             By:________________________________
                                             Name:
                                             Title:










<PAGE>


                                                                       EXHIBIT 1

               Pool Characteristics of the Mortgage Loans as delivered on the
Closing Date:

               All percentages set forth herein are based upon the aggregate
unpaid principal balances of the Mortgage Loans as of the Cut-off Date.

        (1)    No Mortgage Loan had an original Loan-to-Value Ratio in excess of
               94.04%;

        (2)    No more than 2.76% of the Mortgage Loans are related to Mortgaged
               Properties located in any one zip code area;

        (3)    Each Mortgaged Property is located in one of the states listed in
               the charts entitled "Geographic Distribution of the Mortgaged
               Properties" in the Prospectus Supplement;

        (4)    No more than 13.09% of the Mortgage Loans are secured by
               condominium units, no more than 2.56% of the Mortgage Loans are
               secured by Town Houses and no more than 12.99% of the Mortgage
               Loans are secured by cooperative units;

        (6)    No Mortgage Loan had a principal balance in excess of $6,000,000
               at origination;

        (7)    Each Mortgage Loan was originated between February 1995 and
               January 2001;

        (8)    On the basis of representations made by the Mortgagors in their
               loan applications, no more than 1.66% of the Mortgage Loans are
               secured by non-owner occupied homes and at least 98.34% of the
               Mortgage Loans are owner-occupied Mortgaged Properties;

        (9)    The Mortgage Rates borne by the Mortgage Loans as of the Cut-off
               Date ranged from 5.875% per annum to 9.000% per annum and the
               weighted average Mortgage Rate for the Mortgage Loans as of the
               Cut-off Date was 7.202% per annum; and

        (10)   As of the Cut-off Date, approximately 14.55% of the Mortgage
               Loans were rate/term refinancings, approximately 28.30% of the
               Mortgage Loans were cash out refinancings and approximately
               57.15% of the Mortgage Loans were made to purchase the related
               Mortgaged Properties.

<PAGE>



                                   EXHIBIT E-1


                               REQUEST FOR RELEASE
                             (for Trustee/Custodian)



Loan Information
----------------

        Name of Mortgagor:    ________________________________

        Master Servicer
        Loan No.:             ________________________________

Trustee/Custodian
-----------------

        Name:                 ________________________________

        Address:              ________________________________
                              ________________________________

        Trustee/Custodian
        Mortgage File No.:    ________________________________

Depositor
---------

        Name:          SALOMON BROTHERS MORTGAGE
                              SECURITIES VII, INC.

        Address:              ________________________________
                              ________________________________

        Certificates:         Mortgage Pass-Through Certificates,
                              Series 2001-CPB1.





                                      E-1-1

<PAGE>



          The undersigned Master Servicer hereby acknowledges that it has
received from _______________________, as Trustee for the Holders of Mortgage
Pass-Through Certificates, Series 2001-CPB1, the documents referred to below
(the "Documents"). All capitalized terms not otherwise defined in this Request
for Release shall have the meanings given them in the Pooling and Servicing
Agreement, dated as of May 1, 2001, among the Trustee, the Depositor, the Trust
Adminsitrator and the Master Servicer (the "Pooling and Servicing Agreement").

( )  Promissory Note dated _______________, 20__, in the original principal sum
     of $__________, made by _____________________, payable to, or endorsed to
     the order of, the Trustee.

( )  Mortgage recorded on _________________________ as instrument no.
     ____________________ in the County Recorder's Office of the County of
     _________________, State of __________________ in book/reel/docket
     _________________ of official records at page/image _____________.

( )  Deed of Trust recorded on ___________________ as instrument no.
     ________________ in the County Recorder's Office of the County of
     _________________, State of ____________________ in book/reel/docket
     _________________ of official records at page/image ______________.

( )  Assignment of Mortgage or Deed of Trust to the Trustee, recorded on
     ___________________ as instrument no. _________ in the County Recorder's
     Office of the County of _______________, State of _______________________
     in book/reel/docket ____________ of official records at page/image
     ____________.

( )  Other documents, including any amendments, assignments or other assumptions
     of the Mortgage Note or Mortgage.

( )  _____________________________________________

( )  _____________________________________________

( )  _____________________________________________

( )  _____________________________________________

          The undersigned Master Servicer hereby acknowledges and agrees as
follows:

          (1) The Master Servicer shall hold and retain possession of the
     Documents in trust for the benefit of the Trustee, solely for the purposes
     provided in the Agreement.

          (2) The Master Servicer shall not cause or permit the Documents to
     become subject to, or encumbered by, any claim, liens, security interest,
     charges, writs of attachment or other impositions nor shall the Master
     Servicer assert or seek to assert any claims or rights of setoff to or
     against the Documents or any proceeds thereof.


                                      E-1-2

<PAGE>




          (3) The Master Servicer shall return each and every Document
     previously requested from the Mortgage File to the Trustee when the need
     therefor no longer exists, unless the Mortgage Loan relating to the
     Documents has been liquidated and the proceeds thereof have been remitted
     to the Collection Account and except as expressly provided in the
     Agreement.

          (4) The Documents and any proceeds thereof, including any proceeds of
     proceeds, coming into the possession or control of the Master Servicer
     shall at all times be earmarked for the account of the Trustee, and the
     Master Servicer shall keep the Documents and any proceeds separate and
     distinct from all other property in the Master Servicer's possession,
     custody or control.

Dated:

                                     [Master Servicer]

                                     By:________________________________
                                     Name:______________________________
                                     Title:_____________________________





                                      E-1-3

<PAGE>



                                   EXHIBIT E-2
                                   -----------


                               REQUEST FOR RELEASE
                          [Mortgage Loans Paid in Full]

                     OFFICERS' CERTIFICATE AND TRUST RECEIPT
                       MORTGAGE PASS-THROUGH CERTIFICATES
                                Series 2001-CPB1


____________________________________________________ HEREBY CERTIFIES THAT
HE/SHE IS AN OFFICER OF THE MASTER SERVICER, HOLDING THE OFFICE SET FORTH
BENEATH HIS/HER SIGNATURE, AND HEREBY FURTHER CERTIFIES AS FOLLOWS:

WITH RESPECT TO THE MORTGAGE LOANS, AS THE TERM IS DEFINED IN THE POOLING AND
SERVICING AGREEMENT DESCRIBED IN THE ATTACHED SCHEDULE:

ALL PAYMENTS OF PRINCIPAL, PREMIUM (IF ANY), AND INTEREST HAVE BEEN
MADE.

LOAN NUMBER:___________________            BORROWER'S NAME:_____________________

COUNTY:________________________

WE HEREBY CERTIFY THAT ALL AMOUNTS RECEIVED IN CONNECTION WITH SUCH PAYMENTS,
WHICH ARE REQUIRED TO BE DEPOSITED IN THE COLLECTION ACCOUNT PURSUANT TO SECTION
3.10 OF THE POOLING AND SERVICING AGREEMENT, HAVE BEEN OR WILL BE CREDITED.


________________________________           DATED:______________________________

/  /   VICE PRESIDENT

/  /   ASSISTANT VICE PRESIDENT


                                      E-2-1

<PAGE>



                                   EXHIBIT F-1
                                   -----------


                    FORM OF TRANSFEROR REPRESENTATION LETTER


                                     [Date]


[Trustee]
_________________________
_________________________



         Re:   Salomon Brothers Mortgage Securities VII, Inc.,
               Mortgage Pass-Through Certificates, Series 2001-CPB1,
               Class ___, representing a ___% Class ___ Percentage Interest
               ------------------------------------------------------------

Ladies and Gentlemen:

          In connection with the transfer by ________________ (the "Transferor")
to ________________ (the "Transferee") of the captioned mortgage pass-through
certificates (the "Certificates"), the Transferor hereby certifies as follows:

          Neither the Transferor nor anyone acting on its behalf has (a)
offered, pledged, sold, disposed of or otherwise transferred any Certificate,
any interest in any Certificate or any other similar security to any person in
any manner, (b) has solicited any offer to buy or to accept a pledge,
disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c) has
otherwise approached or negotiated with respect to any Certificate, any interest
in any Certificate or any other similar security with any person in any manner,
(d) has made any general solicitation by means of general advertising or in any
other manner, (e) has taken any other action, that (in the case of each of
subclauses (a) through (e) above) would constitute a distribution of the
Certificates under the Securities Act of 1933, as amended (the "1933 Act"), or
would render the disposition of any Certificate a violation of Section 5 of the
1933 Act or any state securities law or would require registration or
qualification pursuant thereto. The Transferor will not act, nor has it
authorized or will it authorize any person to act, in any manner set forth in
the foregoing sentence with respect to any Certificate. The Transferor will not
sell or otherwise transfer any of the Certificates, except in compliance with
the provisions of that certain Pooling and Servicing Agreement, dated as of May
1, 2001, among Salomon Brothers Mortgage Securities VII, Inc. as Depositor,
CitiMortgage, Inc. as Master Servicer and as Trust Administrator and The Bank of
New York as Trustee (the "Pooling and Servicing Agreement"), pursuant to which
Pooling and Servicing Agreement the Certificates were issued.



                                      F-1-1

<PAGE>



          Capitalized terms used but not defined herein shall have the meanings
assigned thereto in the Pooling and Servicing Agreement.

                                             Very truly yours,

                                             [Transferor]

                                             By:__________________________
                                             Name:________________________
                                             Title:_______________________




                                      F-1-2

<PAGE>



                    FORM OF TRANSFEREE REPRESENTATION LETTER


                                                 [Date]


[Trustee]
_______________________
_______________________



          Re:   Salomon Brothers Mortgage Securities VII, Inc.,
                Mortgage Pass-Through Certificates, Series 2001-CPB1,
                Class ___, representing a ___% Class ___ Percentage Interest
                ------------------------------------------------------------

Ladies and Gentlemen:

          In connection with the purchase from ______________________ (the
"Transferor") on the date hereof of the captioned trust certificates (the
"Certificates"), _______________ (the "Transferee") hereby certifies as follows:

          1. The Transferee is a "qualified institutional buyer" as that term is
     defined in Rule 144A ("Rule 144A") under the Securities Act of 1933 (the
     "1933 Act") and has completed either of the forms of certification to that
     effect attached hereto as Annex 1 or Annex 2. The Transferee is aware that
     the sale to it is being made in reliance on Rule 144A. The Transferee is
     acquiring the Certificates for its own account or for the account of a
     qualified institutional buyer, and understands that such Certificate may be
     resold, pledged or transferred only (i) to a person reasonably believed to
     be a qualified institutional buyer that purchases for its own account or
     for the account of a qualified institutional buyer to whom notice is given
     that the resale, pledge or transfer is being made in reliance on Rule 144A,
     or (ii) pursuant to another exemption from registration under the 1933 Act.

          2. The Transferee has been furnished with all information regarding
     (a) the Certificates and distributions thereon, (b) the nature, performance
     and servicing of the Mortgage Loans, (c) the Pooling and Servicing
     Agreement referred to below, and (d) any credit enhancement mechanism
     associated with the Certificates, that it has requested.



                                      F-1-3

<PAGE>




          All capitalized terms used but not otherwise defined herein have the
respective meanings assigned thereto in the Pooling and Servicing Agreement,
dated as of May 1, 2001, among Salomon Brothers Mortgage Securities VII, Inc. as
Depositor, CitiMortgage, Inc. as Master Servicer and as Trust Administrator and
The Bank of New York as Trustee, pursuant to which the Certificates were issued.


                                             [TRANSFEREE]

                                             By:__________________________
                                             Name:________________________
                                             Title:_______________________




                                      F-1-4

<PAGE>



                                                          ANNEX 1 TO EXHIBIT F-1
                                                          ----------------------

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
            --------------------------------------------------------

          [For Transferees Other Than Registered Investment Companies]

          The undersigned hereby certifies as follows to [name of Transferor]
(the "Transferor") and The Bank of New York, as Trustee, with respect to the
mortgage pass-through certificates (the "Certificates") described in the
Transferee Certificate to which this certification relates and to which this
certification is an Annex:

          1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
entity purchasing the Certificates (the "Transferee").

          2. In connection with purchases by the Transferee, the Transferee is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because (i) the Transferee owned and/or
invested on a discretionary basis $______________________/1 in securities
(except for the excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being calculated in accordance
with Rule 144A) and (ii) the Transferee satisfies the criteria in the category
marked below.

     ___  CORPORATION, ETC. The Transferee is a corporation (other than a bank,
          savings and loan association or similar institution), Massachusetts or
          similar business trust, partnership, or any organization described in
          Section 501(c)(3) of the Internal Revenue Code of 1986.

     ___  BANK. The Transferee (a) is a national bank or banking institution
          organized under the laws of any State, territory or the District of
          Columbia, the business of which is substantially confined to banking
          and is supervised by the State or territorial banking commission or
          similar official or is a foreign bank or equivalent institution, and
          (b) has an audited net worth of at least $25,000,000 as demonstrated
          in its latest annual financial statements, a copy of which is attached
          hereto.

     ___  SAVINGS AND LOAN. The Transferee (a) is a savings and loan
          association, building and loan association, cooperative bank,
          homestead association or similar institution, which is supervised and
          examined by a State or Federal authority having supervision over any
          such institutions or is a foreign savings and loan association or
          equivalent institution and (b) has an audited net worth of at least

----------------
1  Transferee must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Transferee is a dealer, and, in that case,
Transferee must own and/or invest on a discretionary basis at least $10,000,000
in securities.



                                                         F-1-5

<PAGE>



          $25,000,000 as demonstrated in its latest annual financial statements,
          a copy of which is attached hereto.

     ___  BROKER-DEALER. The Transferee is a dealer registered pursuant to
          Section 15 of the Securities Exchange Act of 1934.

     ___  INSURANCE COMPANY. The Transferee is an insurance company whose
          primary and predominant business activity is the writing of insurance
          or the reinsuring of risks underwritten by insurance companies and
          which is subject to supervision by the insurance commissioner or a
          similar official or agency of a State, territory or the District of
          Columbia.

     ___  STATE OR LOCAL PLAN. The Transferee is a plan established and
          maintained by a State, its political subdivisions, or any agency or
          instrumentality of the State or its political subdivisions, for the
          benefit of its employees.

     ___  ERISA PLAN. The Transferee is an employee benefit plan within the
          meaning of Title I of the Employee Retirement Income Security Act of
          1974.

     ___  INVESTMENT ADVISOR. The Transferee is an investment advisor registered
          under the Investment Advisers Act of 1940.

          3. The term "SECURITIES" as used herein DOES NOT INCLUDE (i)
securities of issuers that are affiliated with the Transferee, (ii) securities
that are part of an unsold allotment to or subscription by the Transferee, if
the Transferee is a dealer, (iii) securities issued or guaranteed by the U.S. or
any instrumentality thereof, (iv) bank deposit notes and certificates of
deposit, (v) loan participations, (vi) repurchase agreements, (vii) securities
owned but subject to a repurchase agreement and (viii) currency, interest rate
and commodity swaps.

          4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Transferee, the Transferee
used the cost of such securities to the Transferee and did not include any of
the securities referred to in the preceding paragraph. Further, in determining
such aggregate amount, the Transferee may have included securities owned by
subsidiaries of the Transferee, but only if such subsidiaries are consolidated
with the Transferee in its financial statements prepared in accordance with
generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Transferee's direction. However, such
securities were not included if the Transferee is a majority-owned, consolidated
subsidiary of another enterprise and the Transferee is not itself a reporting
company under the Securities Exchange Act of 1934.

          5. The Transferee acknowledges that it is familiar with Rule 144A and
understands that the Transferor and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Transferee may be in reliance on Rule 144A.

      ___      ___        Will the Transferee be purchasing the Certificates


                                      F-1-6

<PAGE>



      Yes      No         only for the Transferee's own account?

          6. If the answer to the foregoing question is "no", the Transferee
agrees that, in connection with any purchase of securities sold to the
Transferee for the account of a third party (including any separate account) in
reliance on Rule 144A, the Transferee will only purchase for the account of a
third party that at the time is a "qualified institutional buyer" within the
meaning of Rule 144A. In addition, the Transferee agrees that the Transferee
will not purchase securities for a third party unless the Transferee has
obtained a current representation letter from such third party or taken other
appropriate steps contemplated by Rule 144A to conclude that such third party
independently meets the definition of "qualified institutional buyer" set forth
in Rule 144A.

          7. The Transferee will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Transferee's purchase of the Certificates will
constitute a reaffirmation of this certification as of the date of such
purchase. In addition, if the Transferee is a bank or savings and loan as
provided above, the Transferee agrees that it will furnish to such parties
updated annual financial statements promptly after they become available.

Dated:

                                             _____________________________
                                             Print Name of Transferee


                                             By:__________________________
                                             Name:________________________
                                             Title:_______________________




                                     F-1-7

<PAGE>



                                                          ANNEX 2 TO EXHIBIT F-1
                                                          ----------------------


            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
            --------------------------------------------------------

           [For Transferees That Are Registered Investment Companies]


          The undersigned hereby certifies as follows to [name of Transferor]
(the "Transferor") and The Bank of New York, as Trustee, with respect to the
mortgage pass-through certificates (the "Certificates") described in the
Transferee Certificate to which this certification relates and to which this
certification is an Annex:

          1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the entity purchasing the
Certificates (the "Transferee") or, if the Transferee is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933 ("Rule 144A") because the Transferee is part of a Family of
Investment Companies (as defined below), is such an officer of the investment
adviser (the "Adviser").

          2. In connection with purchases by the Transferee, the Transferee is a
"qualified institutional buyer" as defined in Rule 144A because (i) the
Transferee is an investment company registered under the Investment Company Act
of 1940, and (ii) as marked below, the Transferee alone, or the Transferee's
Family of Investment Companies, owned at least $100,000,000 in securities (other
than the excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year. For purposes of determining the amount of
securities owned by the Transferee or the Transferee's Family of Investment
Companies, the cost of such securities was used.

____      The Transferee owned $__________________ in securities (other than the
          excluded securities referred to below) as of the end of the
          Transferee's most recent fiscal year (such amount being calculated in
          accordance with Rule 144A).

____      The Transferee is part of a Family of Investment Companies which owned
          in the aggregate $_____________ in securities (other than the excluded
          securities referred to below) as of the end of the Transferee's most
          recent fiscal year (such amount being calculated in accordance with
          Rule 144A).

          3. The term "Family of Investment Companies" as used herein means two
or more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).

          4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Transferee or are part of the
Transferee's Family of Investment Companies, (ii) securities issued or
guaranteed by the U.S. or any instrumentality thereof, (iii) bank deposit notes
and certificates of deposit, (iv) loan participations, (v) repurchase
agreements,


                                      F-1-8

<PAGE>



(vi) securities owned but subject to a repurchase agreement and (vii) currency,
interest rate and commodity swaps.

          5. The Transferee is familiar with Rule 144A and understands that the
parties to which this certification is being made are relying and will continue
to rely on the statements made herein because one or more sales to the
Transferee will be in reliance on Rule 144A. In addition, the Transferee will
only purchase for the Transferee's own account.

          6. The undersigned will notify the parties to which this certification
is made of any changes in the information and conclusions herein. Until such
notice, the Transferee's purchase of the Certificates will constitute a
reaffirmation of this certification by the undersigned as of the date of such
purchase.

Dated:

                                            ____________________________________
                                            Print Name of Transferee or Advisor


                                            By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________


                                            IF AN ADVISER:

                                            ____________________________________
                                            Print Name of Transferee





                                      F-1-9

<PAGE>



                    FORM OF TRANSFEREE REPRESENTATION LETTER


          The undersigned hereby certifies on behalf of the purchaser named
below (the "Purchaser") as follows:

               1. I am an executive officer of the Purchaser.

               2. The Purchaser is a "qualified institutional buyer", as defined
          in Rule 144A, ("Rule 144A") under the Securities Act of 1933, as
          amended.

               3. As of the date specified below (which is not earlier than the
          last day of the Purchaser's most recent fiscal year), the amount of
          "securities", computed for purposes of Rule 144A, owned and invested
          on a discretionary basis by the Purchaser was in excess of
          $100,000,000.


Name of Purchaser ______________________________________________________________

By:   (Signature)_______________________________________________________________

Name of Signatory ______________________________________________________________

Title __________________________________________________________________________

Date of this certificate _______________________________________________________

Date of information provided in paragraph 3 ____________________________________




                                     F-1-10

<PAGE>



                                   EXHIBIT F-2
                                   -----------


                    FORM OF TRANSFER AFFIDAVIT AND AGREEMENT

STATE OF               )
                       : ss.:
COUNTY OF              )


          __________________________, being duly sworn, deposes, represents and
warrants as follows:

          1. I am a ______________________ of ____________________________ (the
"Owner") a corporation duly organized and existing under the laws of
______________, the record owner of Salomon Brothers Mortgage Securities VII,
Inc., Mortgage Pass-Through Certificates, Series 2001-CPB1, Class R-I (the
"Class R Certificates"), on behalf of whom I make this affidavit and agreement.
Capitalized terms used but not defined herein have the respective meanings
assigned thereto in the Pooling and Servicing Agreement pursuant to which the
Class R Certificates were issued.

          2. The Owner (i) is and will be a "Permitted Transferee" as of
____________________, 200___ and (ii) is acquiring the Class R Certificates for
its own account or for the account of another Owner from which it has received
an affidavit in substantially the same form as this affidavit. A "Permitted
Transferee" is any person other than a "disqualified organization" or a
possession of the United States. For this purpose, a "disqualified organization"
means the United States, any state or political subdivision thereof, any agency
or instrumentality of any of the foregoing (other than an instrumentality all of
the activities of which are subject to tax and, except for the Federal Home Loan
Mortgage Corporation, a majority of whose board of directors is not selected by
any such governmental entity) or any foreign government, international
organization or any agency or instrumentality of such foreign government or
organization, any rural electric or telephone cooperative, or any organization
(other than certain farmers' cooperatives) that is generally exempt from federal
income tax unless such organization is subject to the tax on unrelated business
taxable income.

          3. The Owner is aware (i) of the tax that would be imposed on
transfers of the Class R Certificates to disqualified organizations under the
Internal Revenue Code of 1986 that applies to all transfers of the Class R
Certificates after March 31, 1988; (ii) that such tax would be on the transferor
or, if such transfer is through an agent (which person includes a broker,
nominee or middleman) for a non-Permitted Transferee, on the agent; (iii) that
the person otherwise liable for the tax shall be relieved of liability for the
tax if the transferee furnishes to such person an affidavit that the transferee
is a Permitted Transferee and, at the time of transfer, such person does not
have actual knowledge that the affidavit is false; and (iv) that each of the
Class R Certificates may be a "noneconomic residual interest" within the meaning
of proposed Treasury regulations promulgated under the Code and that the
transferor of a "noneconomic residual interest" will remain liable for any taxes
due with respect to the income on such residual


                                      F-2-1

<PAGE>



interest, unless no significant purpose of the transfer is to impede the
assessment or collection of tax.

          4. The Owner is aware of the tax imposed on a "pass-through entity"
holding the Class R Certificates if, at any time during the taxable year of the
pass-through entity, a non-Permitted Transferee is the record holder of an
interest in such entity. (For this purpose, a "pass-through entity" includes a
regulated investment company, a real estate investment trust or common trust
fund, a partnership, trust or estate, and certain cooperatives.)

          5. The Owner is aware that the Trustee will not register the transfer
of any Class R Certificate unless the transferee, or the transferee's agent,
delivers to the Trustee, among other things, an affidavit in substantially the
same form as this affidavit. The Owner expressly agrees that it will not
consummate any such transfer if it knows or believes that any of the
representations contained in such affidavit and agreement are false.

          6. The Owner consents to any additional restrictions or arrangements
that shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Class R Certificates will only be owned, directly
or indirectly, by an Owner that is a Permitted Transferee.

          7. The Owner's taxpayer identification number is ___________________.

          8. The Owner has reviewed the restrictions set forth on the face of
the Class R Certificates and the provisions of Section 5.02(d) of the Pooling
and Servicing Agreement under which the Class R Certificates were issued (in
particular, clauses (iii)(A) and (iii)(B) of Section 5.02(d) which authorize the
Trustee to deliver payments to a person other than the Owner and negotiate a
mandatory sale by the Trustee in the event that the Owner holds such Certificate
in violation of Section 5.02(d)); and that the Owner expressly agrees to be
bound by and to comply with such restrictions and provisions.

          9. The Owner is not acquiring and will not transfer the Class R
Certificates in order to impede the assessment or collection of any tax.

          10. The Owner anticipates that it will, so long as it holds the Class
R Certificates, have sufficient assets to pay any taxes owed by the holder of
such Class R Certificates, and hereby represents to and for the benefit of the
person from whom it acquired the Class R Certificates that the Owner intends to
pay taxes associated with holding such Class R Certificates as they become due,
fully understanding that it may incur tax liabilities in excess of any cash
flows generated by the Class R Certificates.

          11. The Owner has no present knowledge that it may become insolvent or
subject to a bankruptcy proceeding for so long as it holds the Class R
Certificates.

          12. The Owner has no present knowledge or expectation that it will be
unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding.



                                      F-2-2

<PAGE>



          13. The Owner is not acquiring the Class R Certificates with the
intent to transfer the Class R Certificates to any person or entity that will
not have sufficient assets to pay any taxes owed by the holder of such Class R
Certificates, or that may become insolvent or subject to a bankruptcy
proceeding, for so long as the Class R Certificates remain outstanding.

          14. The Owner will, in connection with any transfer that it makes of
the Class R Certificates, obtain from its transferee the representations
required by Section 5.02(d) of the Pooling and Servicing Agreement under which
the Class R Certificate were issued and will not consummate any such transfer if
it knows, or knows facts that should lead it to believe, that any such
representations are false.

          15. The Owner will, in connection with any transfer that it makes of
the Class R Certificates, deliver to the Trustee an affidavit, which represents
and warrants that it is not transferring the Class R Certificates to impede the
assessment or collection of any tax and that it has no actual knowledge that the
proposed transferee: (i) has insufficient assets to pay any taxes owed by such
transferee as holder of the Class R Certificates; (ii) may become insolvent or
subject to a bankruptcy proceeding for so long as the Class R Certificates
remains outstanding; and (iii) is not a "Permitted Transferee".

          16. The Owner is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate or
trust whose income from sources without the United States may be included in
gross income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States.


                                      F-2-3

<PAGE>



          IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors, by
its [Vice] President, attested by its [Assistant] Secretary, this ____ day of
__________, 200___.

                                          [OWNER]


                                          By:__________________________________
                                          Name:________________________________
                                          Title:  [Vice] President


ATTEST:


By:_____________________________
Name:___________________________
Title:    [Assistant] Secretary




          Personally appeared before me the above-named , known or proved to me
to be the same person who executed the foregoing instrument and to be a [Vice]
President of the Owner, and acknowledged to me that [he/she] executed the same
as [his/her] free act and deed and the free act and deed of the Owner.

          Subscribed and sworn before me this ____ day of __________, 200___.



                                                _______________________________
                                                       Notary Public


                                                County of _____________________
                                                State of ______________________

                                                My Commission expires:




                                      F-2-4

<PAGE>



                          FORM OF TRANSFEROR AFFIDAVIT

STATE OF                         )
                                 : ss. :
COUNTY OF                        )


          __________________________, being duly sworn, deposes, represents and
warrants as follows:


1.   I am a ____________________ of ___________________________ (the "Owner"), a
corporation duly organized and existing under the laws of ______________, on
behalf of whom I make this affidavit.

          2. The Owner is not transferring the Class R-I (the "Residual
Certificates") to impede the assessment or collection of any tax.

          3. The Owner has no actual knowledge that the Person that is the
proposed transferee (the "Purchaser") of the Residual Certificates: (i) has
insufficient assets to pay any taxes owed by such proposed transferee as holder
of the Residual Certificates; (ii) may become insolvent or subject to a
bankruptcy proceeding for so long as the Residual Certificates remain
outstanding and (iii) is not a Permitted Transferee.

          4. The Owner understands that the Purchaser has delivered to the
Trustee a transfer affidavit and agreement in the form attached to the Pooling
and Servicing Agreement as Exhibit F-2. The Owner does not know or believe that
any representation contained therein is false.

          5. At the time of transfer, the Owner has conducted a reasonable
investigation of the financial condition of the Purchaser as contemplated by
Treasury Regulations Section 1.860E-1(c)(4)(i) and, as a result of that
investigation, the Owner has determined that the Purchaser has historically paid
its debts as they became due and has found no significant evidence to indicate
that the Purchaser will not continue to pay its debts as they become due in the
future. The Owner understands that the transfer of a Residual Certificate may
not be respected for United States income tax purposes (and the Owner may
continue to be liable for United States income taxes associated therewith)
unless the Owner has conducted such an investigation.

          6. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Pooling and Servicing Agreement


                                      F-2-5

<PAGE>



          IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors, by
its [Vice] President, attested by its [Assistant] Secretary, this ____ day of
___________, 200___.

                                             [OWNER]


                                             By:__________________________
                                             Name:________________________
                                             Title:     [Vice] President


ATTEST:


By:__________________________
Name:________________________
Title:  [Assistant] Secretary




          Personally appeared before me the above-named , known or proved to me
to be the same person who executed the foregoing instrument and to be a [Vice]
President of the Owner, and acknowledged to me that [he/she] executed the same
as [his/her] free act and deed and the free act and deed of the Owner.

          Subscribed and sworn before me this ____ day of __________, 200___.



                                                ________________________________
                                                         Notary Public


                                                County of _____________________
                                                State of ______________________

                                                My Commission expires:





                                      F-2-6

<PAGE>



                                    EXHIBIT G
                                    ---------


            FORM OF CERTIFICATION WITH RESPECT TO ERISA AND THE CODE

                                                    _____________, 200__

Salomon Brothers Mortgage Securities VII, Inc.
390 Greenwich Street
New York, New York 10013

The Bank of New York
101 Barclay Street, 12-E
New York, New York  10286

CitiMortgage, Inc.
15851 Clayton Road
Ballwin, Missouri 63011


             Re:   Salomon Brothers Mortgage Securities VII, Inc.
                   Mortgage Pass-Through Certificates, Series 2001-CPB1, Class__
                   -------------------------------------------------------------

Dear Sirs:

          __________________________________ (the "Transferee") intends to
acquire from _____________________ (the "Transferor") $____________ Initial
Certificate Principal Balance of Salomon Brothers Mortgage Securities VII, Inc.
Mortgage Pass-Through Certificates, Series 2001-CPB1, [Class B-1][Class
B-2][Class B-3][Class B-4][Class B-5][Class B-6][Class R-I] (the
"Certificates"), issued pursuant to a Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") dated as of May 1, 2001 among Salomon
Brothers Mortgage Securities VII, Inc. as depositor (the "Depositor"),
CitiMortgage, Inc. as master servicer (in such capacity, the "Master Servicer")
and as trust administrator (in such capacity, the "Trust Administrator") and The
Bank of New York as trustee (the "Trustee"). Capitalized terms used herein and
not otherwise defined shall have the meanings assigned thereto in the Pooling
and Servicing Agreement. The Transferee hereby certifies, represents and
warrants to, and covenants with the Depositor, the Trustee and the Master
Servicer that the following statements in either (1) or (2) are accurate:

          _____ (1) The Certificates (i) are not being acquired by, and will not
          be transferred to, any employee benefit plan within the meaning of
          section 3(3) of the Employee Retirement Income Security Act of 1974,
          as amended ("ERISA"), or other retirement arrangement, including
          individual retirement accounts and annuities, Keogh plans and bank
          collective investment funds and insurance company general or separate
          accounts in which such plans, accounts or arrangements are invested,
          that is subject to Section 406 of ERISA or Section 4975 of the
          Internal Revenue Code of 1986 (the "Code") (any of the


                                       G-1

<PAGE>



          foregoing, a "Plan"), (ii) are not being acquired with "plan assets"
          of a Plan within the meaning of the Department of Labor ("DOL")
          regulation, 29 C.F.R. ss. 2510.3-101, and (iii) will not be
          transferred to any entity that is deemed to be investing in plan
          assets within the meaning of the DOL regulation at 29 C.F.R. ss.
          2510.3-101; or

          _____ (2) The purchase of the Certificates is permissible under
          applicable law, will not constitute or result in any prohibited
          transaction under ERISA or Section 4975 of the Code, will not subject
          the Depositor, the Trustee or the Master Servicer to any obligation in
          addition to those undertaken in the Pooling and Servicing Agreement
          and the transferee is an insurance company and (A) the source of funds
          used to purchase such Certificate is an "insurance company general
          account" (as such term is defined in PTCE 95-60), (B) the conditions
          set forth in Section I and III of PTCE 95-60 have been satisfied and
          (C) there is no Plan with respect to which the amount of such general
          account's reserves and liabilities for contracts held by or on behalf
          of such Plan and all other Plans maintained by the same employer (or
          any "affiliate" thereof, as defined in PTCE 95-60) or by the same
          employee organization, exceeds 10% of the total of all reserves and
          liabilities of such general account (as determined under PTCE 95-60)
          as of the date of the acquisition of such Certificates.

                                            Very truly yours,


                                            __________________________________

                                            By:_______________________________
                                            Name:
                                            Title:


                                       G-2

<PAGE>



                                   Schedule 1
                                   ----------


                             MORTGAGE LOAN SCHEDULE

                                [FILED BY PAPER]





                                  Schedule 1-1

<PAGE>


                                   Schedule 2
                                   ----------

        MORTGAGE LOAN SCHEDULE WITH RESPECT TO MORTGAGE LOANS WITH LOAN-
               TO-VALUE RATIOS IN EXCESS OF 80% THAT HAVE PRIMARY
                           MORTGAGE INSURANCE POLICES

                                [FILED BY PAPER]




                                  Schedule 2-1