EXHIBIT 4.10


                                 25 June 2004
                                 ------------

                               NORTHERN ROCK PLC
                               as Administrator

                       GRANITE FINANCE TRUSTEES LIMITED
                             as Mortgages Trustee

                               NORTHERN ROCK PLC
                           as Seller and Beneficiary

                        GRANITE FINANCE FUNDING LIMITED
                                as Beneficiary

                                    - and -

                             THE BANK OF NEW YORK
                              as Security Trustee









                    _______________________________________

                           ADMINISTRATION AGREEMENT
                    FIFTH DEED OF AMENDMENT AND RESTATEMENT
                    _______________________________________




                           SIDLEY AUSTIN BROWN & WOOD
                                WOOLGATE EXCHANGE
                              25 BASINGHALL STREET
                                 LONDON EC2V 5HA
                             TELEPHONE 020 7360 3600
                             FACSIMILE 020 7626 7937
                             ref:30507-30030/662426
<PAGE>

THIS DEED is made on 25 June 2004

BETWEEN:

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

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

(3)  NORTHERN ROCK PLC (registered number 3273685), a public limited company
     incorporated under the laws of England and Wales whose registered office
     is at Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL in its
     capacity as Seller and in its capacity as a Beneficiary;

(4)  GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
     limited company incorporated under the laws of Jersey, Channel Islands
     but acting out of its offices established in England (registered overseas
     company number FC022999 and branch number BR005916) at 69 Park Lane,
     Croydon CR9 1TQ in its capacity as a Beneficiary; and

(5)  THE BANK OF NEW YORK a New York banking corporation whose London branch
     address is at One Canada Square, 48th Floor, London E14 5AL in its
     capacity as Security Trustee.

WHEREAS:

(A)  The Administrator carries on the business of, inter alia, administering
     mortgage loans secured on residential properties within the United
     Kingdom.

(B)  The Seller has sold and assigned to the Mortgages Trustee certain
     Mortgage Loans, together with the benefit of Related Security for the
     same on the terms and subject to the conditions set out in the Mortgages
     Sale Agreement among the parties hereto.

(C)  The Administrator has agreed to administer the Mortgage Loans on behalf
     of the Mortgages Trustee (for and on behalf of the Seller and Funding)
     and to provide certain other administration and management services to
     the Mortgages Trustee, the Seller and Funding on the terms and subject to
     the conditions contained in the Administration Agreement dated 26 March
     2001 (as amended, varied, novated or supplemented from time to time, the
     "Administration Agreement").

(D)  The parties have agreed to amend and restate the Administration Agreement
     (the "First Amended and Restated Administration Agreement") pursuant to
     the provisions set out in a deed of amendment and restatement dated 28
     September 2001 (the "First Deed of Amendment and Restatement").

(E)  The parties have agreed to amend and restate the First Amended and
     Restated Administration Agreement (the "Second Amended and Restated
     Administration


<PAGE>

     Agreement") pursuant to the provisions set out in a deed of amendment and
     restatement dated 27 January 2003 (the "Second Deed of Amendment and
     Restatement").

(F)  The parties have agreed to amend and restate the Second Amended and
     Restated Administration Agreement (the "Third Amended and Restated
     Administration Agreement") pursuant to the provisions set out in a deed
     of amendment and restatement dated 24 September 2003 (the "Third Deed of
     Amendment and Restatement").

(G)  The parties have agreed to amend and restate the Third Amended and
     Restated Administration Agreement (the "Fourth Amended and Restated
     Administration Agreement") pursuant to the provisions set out in a deed
     of amendment and restatement dated 28 January 2004 (the "Fourth Deed of
     Amendment and Restatement").

(H)  The parties now wish to amend and restate the Fourth Amended and Restated
     Administration Agreement pursuant to the provisions set out herein.

(I)  With effect from the date hereof, the provisions of the Administration
     Agreement, the First Amended and Restated Administration Agreement, the
     Second Amended and Restated Administration Agreement, the Third Amended
     and Restated Administration Agreement, the Fourth Amended and Restated
     Administration Agreement and this Deed shall be read and construed as
     follows.

NOW IT IS HEREBY AGREED as follows:

1.   INTERPRETATION

1.1  The provisions of the Master Definitions Schedule as amended and restated
     by (and appearing in Appendix 1 to) the Master Definitions Schedule
     Eighth Deed of Amendment made on 26 May 2004 between, among others, the
     parties hereto (as the same have been and may be amended, varied or
     supplemented from time to time with the consent of the parties hereto)
     are expressly and specifically incorporated into and shall apply to this
     Deed.

1.2  The Administration Agreement as amended and restated pursuant to the
     First Deed of Amendment and Restatement, the Second Deed of Amendment and
     Restatement, the Third Deed of Amendment and Restatement, the Fourth Deed
     of Amendment and Restatement and pursuant hereto shall be referred to
     herein as the "Amended and Restated Administration Agreement".

1.3  As used in the Amended and Restated Administration Agreement the terms
     "Administration Agreement", "this Administration Agreement", "Agreement",
     "this Agreement", "herein", "hereinafter", "hereof", "hereto" and other
     words of similar import shall mean or refer to the Amended and Restated
     Administration Agreement, unless the context otherwise specifically
     requires.



                                      2
<PAGE>

2.   AMENDMENTS TO THE FOURTH AMENDED ADMINISTRATION AGREEMENT

     Upon execution of this Deed by the parties hereto, the Fourth Amended and
     Restated Administration Agreement shall be and hereby is amended and
     restated in the form of Appendix I hereto.

3.   CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

     No person shall have any right to enforce any provision of this Deed or
     any provision of the Amended and Restated Administration Agreement under
     the Contract (Rights of Third Parties) Act 1999 but this shall not affect
     any right or remedy of a third party which exists or is available apart
     from that Act.

4.   COUNTERPARTS

     This Deed may be executed in any number of counterparts, and has the same
     effect as if the signatures and/or seals on the counterparts were on a
     single copy of this Deed.

5.   GOVERNING LAW

5.1  This Deed is governed by, and shall be construed in accordance with,
     English law.

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



                                      3
<PAGE>

                                 EXECUTION PAGE

IN WITNESS WHEREOF this Deed has been executed as a deed and delivered by the
parties hereto on the day and year first above written.

as Administrator, Seller and Beneficiary

EXECUTED AS A DEED by               )
NORTHERN ROCK PLC                   )
by:                                 )



Director

Name:

Title:


Director/Company Secretary

Name:

Title:


as Mortgages Trustee

EXECUTED AS A DEED by               )
GRANITE FINANCE TRUSTEES LIMITED    )
by:                                 )



Director

Name:

Title:



Director/Company Secretary

Name:

Title:






                                      4

<PAGE>

as Beneficiary

EXECUTED AS A DEED by              )
GRANITE FINANCE FUNDING LIMITED    )
by:                                )



Director

Name:

Title:



Director/Company Secretary

Name:

Title:



as Security Trustee

EXECUTED AS A DEED by              )
THE BANK OF NEW YORK               )
acting by:                         )



Authorised Signatory

Name:

Title:


                                      5
<PAGE>

                                  Appendix I

                 Amended and Restated Administration Agreement
























                                      6

<PAGE>

                              Dated 25 June 2004
                              ------------------

                               NORTHERN ROCK PLC
                               as Administrator

                                    - and -

                       GRANITE FINANCE TRUSTEES LIMITED
                             as Mortgages Trustee

                                    - and -

                               NORTHERN ROCK PLC
                                   as Seller

                        GRANITE FINANCE FUNDING LIMITED
                                as Beneficiary

                                    - and -

                             THE BANK OF NEW YORK
                              as Security Trustee


                    _______________________________________

                          FIFTH AMENDED AND RESTATED
                           ADMINISTRATION AGREEMENT
                    _______________________________________

















                          SIDLEY AUSTIN BROWN & WOOD
                               WOOLGATE EXCHANGE
                             25 BASINGHALL STREET
                                LONDON EC2V 5HA
                            TELEPHONE 020 7360 3600
                            FACSIMILE 020 7626 7937
                              REF: 30507-2/662691

<PAGE>

                                   CONTENTS

Clause                                                                  Page No.

1.   Definitions and Interpretation...........................................2

2.   Appointment of Administrator.............................................2

3.   The Administration Services..............................................3

4.   Interest Rates...........................................................6

5.   Administration of Mortgages..............................................9

6.   No Liability............................................................14

7.   New Mortgage Loans......................................................14

8.   Product Switching and Further Advances..................................14

9.   Redemption of Mortgages.................................................15

10.  Powers of Attorney......................................................15

11.  Costs and Expenses......................................................16

12.  Information.............................................................16

13.  Remuneration............................................................19

14.  Insurances..............................................................19

15.  Title Deeds.............................................................21

16.  Data Protection.........................................................22

17.  Covenants and Representations and Warranties of Administrator...........23

18.  Services Non-exclusive..................................................24

19.  Termination.............................................................24

20.  Further Assurances......................................................27

21.  Miscellaneous...........................................................27

22.  Confidentiality.........................................................29

23.  No Partnership..........................................................30

24.  Assignment..............................................................30

25.  Security Trustee; Authorised Third Party................................30



<PAGE>

26.  New Intercompany Loan Agreements........................................31

27.  Non Petition Covenant; Limited Recourse.................................31

28.  Amendments and Waiver...................................................32

29.  Notices.................................................................32

30.  Third Party Rights......................................................33

31.  Execution in Counterparts; Severability.................................33

32.  Governing Law and Submission to Jurisdiction............................34

33.  Process Agent...........................................................34

34.  Appropriate Forum.......................................................34

SCHEDULE 1  THE SERVICES.....................................................35

SCHEDULE 2  FORM OF INVESTORS' QUARTERLY REPORT..............................36

SCHEDULE 3  ADMINISTRATOR REPRESENTATIONS AND WARRANTIES.....................40

SCHEDULE 4  AUTHORISED THIRD PARTY...........................................42

SCHEDULE 5  MINIMUM SERVICING STANDARDS......................................45




<PAGE>

THIS FIFTH AMENDED AND RESTATED ADMINISTRATION AGREEMENT DATED 25 JUNE 2004
AMENDS AND RESTATES THE ADMINISTRATION AGREEMENT DATED 26 MARCH 2001 BETWEEN:

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

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

(3)  NORTHERN ROCK PLC (registered number 3273685), a public limited company
     incorporated under the laws of England and Wales whose registered office
     is at Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL in its
     capacity as Seller and its capacity as a Beneficiary;

(4)  GRANITE FINANCE FUNDING LIMITED (registered number 79308), a private
     limited company incorporated under the laws of Jersey but acting out of
     its branch office established in England (registered overseas company
     number FC022999 and branch number BR0051916) at 69 Park Lane, Croydon CR9
     1TQ in its capacity as a Beneficiary; and

(5)  THE BANK OF NEW YORK, a New York banking corporation whose London branch
     address is at One Canada Square, 48th Floor, London E14 5AL, in its
     capacity as Security Trustee;

WHEREAS:

(A)  The Administrator carries on the business of, inter alia, administering
     mortgage loans secured on residential properties within the United
     Kingdom.

(B)  By the Mortgage Sale Agreement, the Seller has agreed to sell and assign
     the Mortgage Loans and Related Security comprised in the Mortgage
     Portfolio to the Mortgages Trustee. The Mortgages Trustee shall hold the
     Mortgage Portfolio together with any New Mortgage Portfolio on trust for
     Funding and the Seller pursuant to the terms of the Mortgages Trust Deed.

(C)  The Administrator is willing to administer the Mortgage Loans on behalf
     of the Mortgages Trustee and to provide certain other administration and
     management services to the Mortgages Trustee, the Seller and Funding on
     the terms and subject to the conditions contained in this Agreement in
     relation to, inter alia, the Mortgage Loans and Related Security sold and
     assigned to the Mortgages Trustee by the Seller.



<PAGE>

IT IS HEREBY AGREED as follows:

1.   Definitions and Interpretation

1.1  Definitions: The provisions of the Master Definitions Schedule as amended
     and restated by (and appearing in Appendix 1 to) the Master Definitions
     Schedule Eighth Amendment and Restatement Deed made on 26 May 2004
     between, among others, the Seller, Funding and the Mortgages Trustee (as
     the same have been and may be amended, varied or supplemented from time
     to time with the consent of the parties hereto) are expressly and
     specifically incorporated into and shall apply to this Agreement.

1.2  Exercise of Discretion: Any reference in this Agreement to any
     discretion, power or right on the part of the Mortgages Trustee shall be
     as exercised by the Mortgages Trustee only as directed by the
     Beneficiaries but subject in each case to the provisions of the Mortgages
     Trust Deed.

1.3  Schedules: For the avoidance of doubt, the parties hereto agree that the
     Schedules attached to this Agreement shall form a part of this Agreement,
     and the provisions of this Agreement shall be construed in accordance
     with such Schedules.

2.   Appointment of Administrator

2.1  Appointment: Subject to Clause 4.5 herein, and until termination pursuant
     to Clause 19 herein (Termination), the Mortgages Trustee hereby appoints
     the Administrator to administer the Mortgages Loans on its behalf, and
     each of the Mortgage Trustee, the Seller and Funding (according to their
     respective estates and interests) each hereby appoints the Administrator
     as its lawful agent on their respective behalves to provide certain other
     administration and management services and to exercise their respective
     rights, powers and discretions, and to perform their respective duties,
     under and in relation to the Mortgage Loans and their Related Security.
     The Administrator in each case hereby accepts such appointment on the
     terms and subject to the conditions of this Agreement. The Security
     Trustee consents to the appointment of the Administrator on the terms of
     and subject to the conditions of this Agreement.

2.2  Power and Authority: For the avoidance of doubt and in connection with
     the rights, powers and discretions conferred under Clause 2.1 herein,
     during the continuance of its appointment hereunder, the Administrator
     shall, subject to the terms and conditions of this Agreement, the
     Mortgage Conditions, the Mortgage Sale Agreement and the Mortgages Trust
     Deed, have the full power, authority and right to do or cause to be done
     any and all things which it reasonably considers necessary, convenient or
     incidental to the administration of the Mortgage Loans and their Related
     Security or the exercise of such rights, powers and discretions, provided
     however that neither the Mortgages Trustee nor Funding nor their
     respective directors shall be required or obliged at any time to enter
     into any transaction or to comply with any directions which the
     Administrator may give with respect to the operating and financial
     policies of the Mortgages Trustee or Funding and the Administrator hereby
     acknowledges that all powers to determine such policies (including the
     determination of whether or not any particular policy is for the benefit
     of the Mortgages Trustee or Funding) are, and shall at all times remain,
     vested, as the case may be, in the Mortgages Trustee and/or


                                      2
<PAGE>

     Funding (and their respective directors) and none of the provisions of
     this Agreement shall be construed in a manner inconsistent with this
     proviso.

2.3  Appointment Conditional: The appointment pursuant to Clause 2.1 herein is
     conditional upon the issue of the First Issuer Notes having taken place
     and shall take effect upon and from the Initial Closing Date
     automatically without any further action on the part of any person
     PROVIDED THAT if the issue of the First Issuer Notes has not occurred by
     30 April 2001, or such later date as the First Issuer and the Lead
     Manager may agree, this Agreement shall cease to be of further effect.

3.   The Administration Services

3.1  General: The duty of the Administrator shall be to provide the services
     set out in this Agreement including Schedule 1 (the "Services").

3.2  Sub-contracts:

     (a)  The Administrator may sub-contract or delegate the performance of
          all or any of its powers and obligations under this Agreement,
          provided that (but subject to Clause 3.2(b) herein):

          (i)  the prior written consent of the Mortgages Trustee and Funding
               to the proposed arrangement (including, if Funding considers it
               necessary after consulting with the Security Trustee, approving
               any contract which sets out the terms on which such
               arrangements are to be made) has been obtained, the Security
               Trustee has been consulted and notification has been given to
               each of the Rating Agencies;

          (ii) where the arrangements involve the custody or control of any
               Mortgage Loan Files and/or Title Deeds relating to the Mortgage
               Portfolio for the purpose of performing any delegated Services,
               the sub-contractor or delegate has executed an acknowledgement
               in writing acceptable to Funding and the Security Trustee to
               the effect that any such Mortgage Loan Files and/or Title Deeds
               are and will be held to the order of the Mortgages Trustee (as
               trustee for the Beneficiaries);

         (iii) where the arrangements involve or may involve the receipt by
               the sub-contractor or delegate of monies belonging to the
               Beneficiaries which, in accordance with this Agreement, are to
               be paid into the relevant Collection Account, the
               sub-contractor or delegate has executed a declaration in
               writing acceptable to the Beneficiaries that any such monies
               held by it or to its order are held on trust for the
               Beneficiaries and will be paid forthwith into the relevant
               Collection Account in accordance with the terms of the
               Mortgages Trust Deed;

          (iv) any such sub-contractor or delegate has executed a written
               waiver of any Security Interest arising in connection with such
               delegated Services (to the extent that such Security Interest
               relates to the Mortgage Portfolio or any amount referred to in
               (iii) above); and



                                      3
<PAGE>

          (v)  neither the Mortgages Trustee, the Security Trustee nor the
               Beneficiaries shall have any liability for any costs, charges
               or expenses payable to or incurred by such sub-contractor or
               delegate or arising from the entering into, the continuance or
               the termination of any such arrangement.

     (b)  The provisos to Clause 3.2(a) (i), (ii) and (iii) herein shall not
          apply:

          (i)  to the engagement by the Administrator of:

               (1)  any receiver, solicitor, insurance broker, valuer,
                    surveyor, accountant, estate agent, insolvency
                    practitioner, auctioneer, bailiff, debt counsellor,
                    tracing agent, property management agent, licensed or
                    qualified conveyancer or other professional adviser acting
                    as such; or

               (2)  any locksmith, builder or other contractor acting as such
                    in relation to a Mortgaged Property, in any such case
                    being a person or persons whom the Administrator would be
                    willing to appoint in respect of its own mortgages in
                    connection with the performance by the Administrator of
                    any of its obligations or functions or in connection with
                    the exercise of its powers under this Agreement; or

          (ii) to any delegation to any wholly-owned subsidiary of the Seller
               from time to time.

     (c)  The Mortgages Trustee and/or Funding and the Security Trustee may
          require the Administrator to assign to the Mortgages Trustee any
          rights which the Administrator may have against any sub-contractor
          or delegate arising from the performance of services by such person
          in association with any matter contemplated by this Agreement and
          the Administrator acknowledges that such rights assigned to the
          Mortgages Trustee will be exercised by the Mortgages Trustee as
          trustee for the Beneficiaries subject to the terms of the Mortgages
          Trust Deed.

     (d)  Notwithstanding any sub-contracting or delegation of the performance
          of the Administrator's obligations under this Agreement:

          (i)  the Administrator shall not thereby be released or discharged
               from any liability hereunder;

          (ii) the Administrator shall remain responsible for the performance
               of the obligations of the Administrator under this Agreement;

          (iii) the performance or non-performance or the manner of
               performance of any sub-contractor or delegate of any of the
               Services shall not affect the Administrator's obligations under
               this Agreement;

          (iv) any breach in the performance of the Services by any
               sub-contractor or delegate shall, subject to the Administrator
               being entitled for a period of twenty (20) Business Days from
               receipt of notice of the breach to


                                      4
<PAGE>

               remedy such breach by any sub-contractor or delegate, be
               treated as a breach of this Agreement by the Administrator; and

          (v)  the Security Trustee shall have no liability for any act or
               omission of the sub-contractor or delegate and shall have no
               responsibility for monitoring or investigating the suitability
               of any such sub-contractor or delegate.

3.3  Notices etc.

     (a)  Within fifteen (15) days after the Initial Closing Date, the
          Administrator will:

          (i)  on behalf of the Mortgages Trustee (at the direction of the
               Beneficiaries or with their consent), give to third parties
               such notices as any of the Beneficiaries are required to give
               pursuant to the Mortgage Sale Agreement; and

          (ii) submit for registration at the Companies Registry a duly
               completed Form 395 and original executed copy of the First
               Issuer Deed of Charge pursuant to Chapter 1 of Part XII of the
               Companies Act 1985,

          and in each case, the Administrator shall take all reasonable steps
          to ensure the return by the relevant recipient of the duplicate
          notices of assignment by way of acknowledgement thereof.

     (b)  Promptly upon request by Funding and the Security Trustee, the
          Administrator shall procure that any notices permitted to be given
          by the Mortgages Trustee under Clause 6.4 (Prior to Perfection) of
          the Mortgage Sale Agreement are so given by the Administrator on the
          Mortgages Trustee's behalf.

3.4  Liability of Administrator:

     (a)  The Administrator shall indemnify each of the Mortgages Trustee and
          the Beneficiaries on demand on an after-tax basis for any loss,
          liability, claim, expense or damage suffered or incurred by either
          of them in respect of the negligence or wilful default of the
          Administrator in carrying out its functions as Administrator under
          this Agreement or the other Transaction Documents or as a result of
          a breach by the Administrator of the terms and provisions of this
          Agreement or the other Transaction Documents in relation to such
          functions.

     (b)  For the avoidance of doubt, the Administrator shall not be liable in
          respect of any loss, liability, claim, expense or damage suffered or
          incurred by the Mortgages Trustee and/or the Beneficiaries and/or
          any other person as a result of the proper performance of the
          Services by the Administrator save where such loss, liability,
          claim, expense or damage is suffered or incurred as a result of any
          negligence or wilful default of the Administrator or as a result of
          a breach by the Administrator of the terms and provisions of this
          Agreement or the other Transaction Documents in relation to such
          functions.

     (c)  Any indemnification under this Clause 3.4 in respect of loss
          suffered by the Beneficiaries shall be paid for by reducing the
          Seller Share of the Trust Property by an amount equal to the
          relevant loss incurred by the Beneficiaries


                                      5
<PAGE>

          in accordance with Clause 8.5 (Adjustments to Trust Property) of the
          Mortgages Trust Deed and Schedule 2 to the Cash Management
          Agreement.

3.5  Perfection of Mortgages Trustee's and Beneficiaries' Title to the
     Mortgage Loans

     Subject to Clause 6 of the Mortgage Sale Agreement:

     (a)  upon the receipt by the Seller of a written request from the
          Mortgages Trustee, Funding or the Security Trustee to execute
          transfers and/or assignments pursuant to Clause 6.2 of the Mortgage
          Sale Agreement, the Administrator shall execute or procure the
          execution of such transfers on behalf of the Seller or shall provide
          sufficient information to enable the Mortgages Trustee, Funding or
          the Security Trustee to do so; and

     (b)  upon the Seller being required to do so by the Mortgages Trustee,
          Funding or the Security Trustee pursuant to Clause 6.1 of the
          Mortgage Sale Agreement, the Administrator shall do all or any of
          the acts, matters or things referred to in Clauses 6.2 and 6.3 of
          the Mortgage Sale Agreement.

4.   Interest Rates

4.1  Determination of Interest Rates: Subject to the provisions of applicable
     law and regulations and any regulatory undertakings binding on the
     Administrator or the Issuer from time to time and subject to the
     following provisions of this Clause 4, the Mortgages Trustee and each of
     the Beneficiaries each hereby grants the Administrator full right,
     liberty and authority from time to time to determine:

     (a)  in accordance with the applicable Mortgage Conditions, Mortgage
          Terms and the Base Rate Pledge, the Standard Variable Rate and any
          other discretionary rates and margins applicable to the Mortgage
          Loans chargeable to Borrowers from time to time; and

     (b)  the Existing Borrowers' Re-Fix Rate in accordance with Clause 4.4
          herein.

     In exercising such right, liberty and authority the Administrator
     undertakes to each of the other parties to this Agreement that it shall
     not at any time set or maintain the Standard Variable Rate and any other
     discretionary rates and margins applicable to the Mortgage Loans at rates
     which are higher than the then prevailing equivalent rates offered by the
     Seller, unless the Administrator is required to do so pursuant to Clause
     4.3 herein, and, subject to that requirement, that it shall not change
     the Standard Variable Rate and any other discretionary rates and margins
     applicable to the Mortgage Loans save for the same reasons as the Seller
     was entitled, under the Mortgage Conditions, to change the then
     prevailing equivalent rates offered by the Seller prior to the sale and
     assignment to the Mortgages Trustee of the Mortgage Loans comprised in
     the Mortgage Portfolio and their Related Security. Each of the Issuer and
     the Security Trustee shall be bound by any Mortgage Rates (including the
     Existing Borrowers' Re-Fix Rate) determined by the Administrator in
     accordance with this Clause 4.

4.2  Notification to Borrowers: The Administrator shall take all steps
     necessary pursuant to the relevant Mortgage Conditions or applicable law
     to bring each change in the


                                      6
<PAGE>

     Standard Variable Rate and any other discretionary rate or margin
     applicable to the Mortgage Loans and any consequent changes in Monthly
     Payments to the attention of the relevant Borrowers and shall, as soon as
     reasonably practicable after any change in such rates, provide details of
     such changes to each of the Mortgages Trustee, the Security Trustee and
     the Beneficiaries, and shall, upon receipt of a request from any of such
     parties, notify such requesting party of any changes in the Monthly
     Payments in relation to the Mortgage Loans.

4.3  Interest Rate Shortfall:

     (a)  On each Payment Date the Administrator shall determine, having
          regard to:

          (i)  the income which Funding would expect to receive during the
               next succeeding Interest Period;

          (ii) the Mortgage Rates in respect of the Mortgage Loans which the
               Administrator proposes to set under this Clause 4; and

         (iii) the other resources available to Funding including the Funding
               Reserve Fund and amounts standing to the credit of any Issuer
               Reserve Fund and/or any Issuer Liquidity Reserve Fund,

          whether Funding would receive an amount of income during that
          Interest Period which when aggregated with the funds otherwise
          available to it is less than the amount which is the aggregate of
          (1) the amount of interest which will be payable by Funding in order
          to fund (whether by payment to a swap provider or otherwise) the
          amount of interest payable in respect of the Class A Notes of the
          First Issuer (and the highest ranking class of notes of any New
          Issuer, if any) and all amounts which rank in priority thereto on
          the Payment Date occurring at the end of such Interest Period, and
          (2) all other amounts payable by Funding which rank in priority to
          or pari passu with interest due on the First Issuer Intercompany
          Loan in respect of interest which is payable on the Class A Notes of
          the First Issuer (and any New Intercompany Loan, if any, in respect
          of interest which is payable by any New Issuer on the highest rated
          class of Notes issued by such New Issuer, if any) (the amount (if
          any) by which it is less being the "Interest Rate Shortfall").

     (b)  If the Administrator determines that there will be an Interest Rate
          Shortfall, it will within one (1) London Business Day of such
          determination give written notice thereof to the Mortgages Trustee,
          Funding and the Security Trustee of such Interest Rate Shortfall and
          of the Standard Variable Rate and other discretionary rates and
          margins applicable to the Mortgage Loans which would, in the
          Administrator's opinion, need to be set in order for no Interest
          Rate Shortfall to arise, having regard to the obligations of Funding
          under all Intercompany Loans.

     (c)  If the Mortgages Trustee, Funding and/or the Security Trustee notify
          the Administrator that, having regard to the obligations of Funding,
          the Standard Variable Rate and other discretionary rates and margins
          should be increased (which shall be the same rates as previously
          notified to the Mortgages Trustee, Funding and the Security Trustee
          in accordance with Clause 4.3(b)), the


                                      7
<PAGE>

          Administrator, as agent for and on behalf of the Mortgages Trustee,
          shall take all steps which are necessary, including publishing any
          notice which is required in accordance with the Mortgage Terms, to
          effect such change in the applicable rates on the date(s) specified
          in the notice referred to in Clause 4.3(b) herein.

4.4  Existing Borrowers' Re-Fix Rate:

     (a)  The Administrator shall, in relation to each Fixed Rate Mortgage
          Loan, serve on the Seller as agent for and on behalf of, inter alia,
          the Mortgages Trustee and the Beneficiaries the notice referred to
          in Clause 8.6(a) of the Mortgage Sale Agreement sixty (60) days
          before the expiry of the initial fixed rate period (as defined in
          Clause 8.6(a) of the Mortgage Sale Agreement) applicable to that
          Fixed Rate Mortgage Loan.

     (b)  If Clause 8.6(b) of the Mortgage Sale Agreement applies to any Fixed
          Rate Mortgage Loan, the Administrator shall take all steps which are
          necessary to perform the obligations of the Seller and exercise the
          rights under such Clause.

     (c)  The Administrator shall, whenever Clause 8.6(c) of the Mortgage Sale
          Agreement applies to a Fixed Rate Mortgage Loan, determine (after
          consultation with the Basis Rate Swap Provider, the Currency Swap
          Provider, and any other swap provider the Administrator (acting
          reasonably) determines appropriate) the rate (and terms) upon which
          the Existing Borrowers' Re-Fix Rate should be set having regard to
          the interests of the Basis Rate Swap Provider and the Currency Swap
          Provider (except to the extent that the Administrator believes that
          the interests of either of the Basis Rate Swap Provider or the
          Currency Swap Provider are materially prejudicial to the interests
          of the Noteholders). The Administrator will give written notice of
          such determination within one Business Day thereof to the Mortgages
          Trustee and the Beneficiaries recommending what the Existing
          Borrowers' Re-Fix Rate should be and the terms at which it should be
          offered, having regard to the interests of the Basis Rate Swap
          Provider and the Currency Swap Provider (except to the extent that
          the Administrator believes that the interests of either of the Basis
          Rate Swap Provider or the Currency Swap Provider are materially
          prejudicial to the interests of the Noteholders). The Administrator
          will solicit quotations on rates from each of (i) the Mortgages
          Trustee, (ii) Funding, and (iii) other trustees for re-fixed
          mortgage loans in relation to other outstanding securitisations of
          the Seller (if any), and shall notify the Mortgages Trustee and the
          Beneficiaries as to the higher of (x) any rate provided by any of
          the parties in (i) through (iii) herein and (y) current rates for
          re-fixed mortgage loans (not included in any Mortgage Portfolio) in
          relation to other Mortgage Loans of the Administrator. If the
          Mortgages Trustee agrees in writing with such recommendation, or
          (whether or not it has received the Administrator's recommendation)
          requires alternative rates and/or terms (such agreement or
          requirement being the "EBRR Determination") the Administrator shall
          immediately notify the Seller and the First Issuer (and any New
          Issuer) of the EBRR Determination, and take all steps which are
          necessary to enable the First Issuer (and any New Issuer) to enter
          into the relevant swap agreement either with the Basis Rate Swap
          Provider or the Currency Swap Provider (or other swap provider whose
          appointment would not adversely affect the then


                                      8
<PAGE>

          current ratings of the Notes) at the rate (and on the terms)
          required in accordance with the EBRR Determination (the "Required
          Rate and Terms"). Nothing in this Clause 4.4(c) shall prevent the
          Mortgages Trustee from setting the Existing Borrowers' Re-Fix Rate
          in accordance with its powers under the Mortgage Sale Agreement.

     (d)  If Clause 8.6 of the Mortgage Sale Agreement applies to any Fixed
          Rate Mortgage Loan, and the Seller fails to set the Existing
          Borrowers' Re-Fix Rate immediately upon being required to do so in
          accordance with the Required Rate and Terms or otherwise to perform
          its obligations under Clause 8.6(c) of the Mortgage Sale Agreement,
          the Administrator as attorney for the Mortgages Trustee and the
          Beneficiaries shall set the Existing Borrowers' Re-Fix Rate on the
          Required Rate and Terms.

4.5  Termination of Authority: The Mortgages Trustee and/or Funding and the
     Security Trustee may terminate the authority of the Administrator under
     Clauses 4.1 and 4.3 herein to determine either of the Mortgage Rate(s) or
     Existing Borrowers' Re-Fix Rate on or after the occurrence of a
     Termination Event pursuant to Clause 19 herein, in which case the
     Mortgages Trustee shall set the Mortgage Rate(s) or Existing Borrowers'
     Re-Fix Rate, as applicable, in accordance with this Clause 4.

5.   Administration of Mortgages

5.1  Collection of Payments:

     (a)  For the purposes of collecting amounts due from any Borrower under a
          Mortgage Loan, where such Borrower makes a Monthly Payment by way of
          Direct Debit the Administrator will, unless otherwise agreed in
          writing with the Beneficiaries:

          (i)  act as collecting agent for the Beneficiaries under the Direct
               Debiting Scheme;

          (ii) comply with the obligations on its part set out in the Bank
               Account Agreement including, without limitation, the specific
               provisions relating to the collection of monies set out in
               Clause 4 of the Bank Account Agreement;

         (iii) comply in all material respects with the requirements from
               time to time of the Direct Debiting Scheme; and;

          (iv) using its reasonable endeavours, credit any Monthly Payment
               made by a Borrower by way of Direct Debit to the relevant
               Collection Account within one (1) London Business Day of
               receipt (and in any event within three (3) London Business Days
               of such receipt) into the relevant Collection Account.

     (b)  The Administrator may agree with a Borrower that the Direct Debiting
          Scheme shall not apply to Monthly Payments to be made by such
          Borrower, provided that (i) alternative payment arrangements are
          made which are intended to ensure the timely making of Monthly
          Payments due from the


                                      9
<PAGE>

          Borrower to the Mortgages Trustee, and (ii) the change in
          arrangements was made at the instigation of the Borrower or by the
          Administrator in accordance with the procedures which would be
          adopted by a reasonable and prudent mortgage lender. The
          Administrator shall, using its reasonable endeavours, credit Monthly
          Payments made by a Borrower under an alternative payment arrangement
          as follows to the relevant Collection Account:

          (i)  by standing order, by close of business on the second (2nd)
               London Business Day following the day on which such amount is
               received or credited by the Administrator;

          (ii) by payment of cash, transfer payment from another account of
               the Seller or check where reference to the relevant Borrower is
               provided or payments made by way of paying-in book, by close of
               business on the London Business Day which immediately follows
               the day on which such amount is received or credited by the
               Administrator; and

         (iii) in the case of any payment by check where a reference to the
               relevant Borrower is not provided, by close of business on the
               next London Business Day after notification from the Operating
               Banks of the identity of the Borrower;

     (c)  provided however, that in any event the Administrator shall credit
          Monthly Payments made by a Borrower under an alternative payment
          arrangement within three (3) London Business Days of such receipt.

     (d)  The Administrator may, notwithstanding the proviso to Clause 5.2(b)
          herein, agree such procedures for the payment by a Borrower of (i)
          overdue amounts and (ii) amounts payable on redemption of a Mortgage
          in whole or in part other than through the Direct Debiting Scheme as
          would be agreed by a reasonable and prudent mortgage lender.

     (e)  Where a Borrower permits a Direct Debit to be made to his bank
          account, the Administrator will endeavour to procure that such
          Borrower maintains a valid and effective mandate relating to such
          Direct Debit in relation to each Monthly Payment due from that
          Borrower, provided that in any case where a Borrower will not permit
          a Direct Debit to be made to his bank account the Administrator will
          endeavour to make alternative arrangements acceptable to a
          reasonable and prudent mortgage lender so that such Borrower
          nevertheless pays each Monthly Payment on the due date.

     (f)  In the event that the Bankers Automated Clearing System ceases to
          operate for any reason the Administrator will use reasonable
          endeavours to make alternative arrangements for the use of the
          back-up systems available to each Account Bank.

5.2  Administration and Enforcement of Mortgages:

     (a)  The Mortgages Trustee as trustee for the Beneficiaries hereby
          directs the Administrator to administer the Mortgage Loans comprised
          in the Mortgage


                                      10
<PAGE>

          Portfolio and carry out its specific obligations under this
          Agreement in accordance with the Administration Procedures.

     (b)  The Administrator will, in relation to any default by a Borrower
          under or in connection with a Mortgage Loan or a Mortgage comprised
          in the Mortgage Portfolio, comply with the Enforcement Procedures
          or, to the extent that the Enforcement Procedures are not applicable
          having regard to the nature of the default in question, take such
          action as is not materially prejudicial to the interests of the
          Mortgages Trustee (as trustee for the Beneficiaries) and the
          Beneficiaries under the relevant MIG Policy, provided that:

          (i)  the Administrator shall only become obliged to comply with the
               Enforcement Procedures (to the extent applicable) or to take
               action as aforesaid after it has become aware of the default;

          (ii) it is acknowledged by the Beneficiaries that mortgage lenders
               generally exercise discretion in pursuing their respective
               enforcement procedures and that the Administrator may exercise
               such discretion as would a reasonable and prudent mortgage
               lender in applying the Enforcement Procedures to any particular
               defaulting Borrower or taking action as aforesaid, provided
               that in exercising such discretion the interest of Funding in
               the Mortgage Portfolio is not materially prejudiced; and

         (iii) in any case where any of the Insurance Policies requires exact
               compliance with certain enforcement procedures, the
               Administrator shall procure the prior written consent of the
               relevant insurance company for any deviation by it from such
               enforcement procedures.

5.3  Records: The Administrator shall keep and maintain records in relation to
     the Mortgage Portfolio, on a Mortgage Loan by Mortgage Loan basis, for
     the purposes of identifying amounts paid by each Borrower, any amount due
     from a Borrower and the balance from time to time outstanding on a
     Borrower's account and such other records as would be kept by a
     reasonable and prudent mortgage lender. Subject always to the
     restrictions and conditions set forth in Clause 16, the Administrator
     will provide such information to the Mortgages Trustee and/or Funding
     and/or the Security Trustee at any time upon reasonable notice, subject
     to the Administrator being reasonably capable of providing such
     information without significant additional cost and subject to the
     provisions of the Data Protection Act 1998 and other applicable
     legislation from time to time, and provided that no duty of confidence
     and no industry code of practice will or may be breached thereby.

5.4  Trust:

     (a)  If the Administrator, in carrying out its functions as Administrator
          under this Agreement, receives (including in its capacity as agent
          for the Mortgages Trustee as trustee for the Beneficiaries) any
          money whatsoever arising from the Mortgage Loans and their Related
          Security, which money belongs to the Mortgages Trustee (as trustee
          for the Beneficiaries) and is to be paid to the relevant Collection
          Account pursuant to this Agreement or any of the other Transaction
          Documents or otherwise, it will hold such monies on trust for the


                                      11
<PAGE>

          Mortgages Trustee and shall keep such money separate from all other
          monies held by the Administrator and shall, as soon as reasonably
          practicable and in any event within three (3) London Business Days
          of receipt of the same, pay the monies into the relevant Collection
          Account.

     (b)  All other sums received by the Administrator in respect of the
          Mortgage Loans and their Related Security shall be held by the
          Administrator for itself.

5.5  Together Connections Mortgage Loans and Connections Mortgage Loans:

     (a)  The Seller shall, upon request, use its reasonable endeavours to:

          (i)  provide the Mortgages Trustee, Funding and the Administrator
               with such information (including, but not limited to
               documentary information) in its possession; and

          (ii) do such other acts and things,

          that the Mortgages Trustee, Funding and the Administrator may
          require in order for such parties to exercise their rights and
          comply with their obligations under the Together Connections
          Mortgage Loans and the Connections Mortgage Loans and under the
          Transaction Documents with respect to the administration of such
          Mortgage Loans.

     (b)  Each of the Mortgages Trustee, Funding and the Administrator shall,
          upon request, use their reasonable endeavours to:

          (i)  provide the Seller with such information (including, but not
               limited to documentary information) in its possession; and

          (ii) do such other acts and things,

          that the Seller may require in order for the Seller to, exercise its
          rights and comply with its obligations under the Together Connection
          Conditions and the Connection Conditions (where such rights and
          obligations are not required to be administered by the Mortgages
          Trustee, Funding or the Administrator under the Transaction
          Documents) and in respect of the products linked to the Together
          Connections Mortgage Loans and Connections Mortgage Loans.

     (c)  Any notice, letter or other communication:

          (i)  received or given by the Seller under the Together Connection
               Conditions or the Connection Conditions shall be copied by the
               Seller to the Administrator; and

          (ii) received or given by the Mortgages Trustee, Funding or the
               Administrator under the Together Connection Conditions or the
               Connection Conditions shall be copied by such parties to the
               Seller.

     (d)  The Administrator shall act in accordance with the instructions of
          the Seller in any matter where the powers, rights, obligations or
          commercial interests of the Seller under the Together Connection
          Conditions or the Connection


                                      12
<PAGE>

          Conditions or with respect to the products linked to the Together
          Connections Mortgage Loan or the Connections Mortgage Loan may be
          affected in a material manner. Such matters may include, but not
          limited to, the following:

          (i)  any request from a Borrower to amend the allocation of the
               Together Connections Benefit or the Connections Benefit that
               may accrue to such Borrower under the terms of the relevant
               Together Connection Conditions or Connection Conditions;

          (ii) any amendment to the Together Connection Conditions or the
               Connection Conditions;

         (iii) except where the Administrator is required to act in
               accordance with Clause 4.3 (Interest Rate Shortfall), the
               determination or variation of the Connection Interest Rate
               (provided that such rate shall not at any time be set at a rate
               which is higher than the equivalent rate offered by the
               Seller);

          (iv) any change to the availability or amendment to the eligibility
               of any product to be linked to a Together Connections Mortgage
               Loan or a Connections Mortgage Loan; and

          (v)  the termination of the Together Connection Conditions or the
               Connection Conditions.

          In all other cases where the Administrator, on behalf of the other
          parties hereto is required to exercise its judgment or discretion in
          the application of the Together Connection Conditions or the
          Connection Conditions, the Administrator shall undertake the same in
          consultation with the Seller.

     (e)  The Seller shall not have any right to provide instructions to the
          Administrator in respect of any amendment to the Together Connection
          Conditions or Connection Conditions where such amendment will result
          in a Product Switch in respect of the applicable Together
          Connections Mortgage Loans or Connections Mortgage Loans unless the
          Seller has given confirmation in accordance with the terms of the
          Mortgage Sale Agreement that it has elected to repurchase such
          Together Connections Mortgage Loans or Connections Mortgage Loans.

5.6  Statement as to Compliance

     The Administrator shall deliver to the Mortgages Trustee not later than
     30th April in each year (or, in the case of 2004, 30 June) commencing in
     2004, an officers' certificate stating, as to each signatory thereof,
     that (i) a review of the activities of the Administrator during the
     preceding year and of its 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 Administrator has fulfilled all of
     its obligations under this Agreement throughout such year, or, if there
     has been a default in the fulfilment of any such obligation, specifying
     each such default known to such officers and the nature and status
     thereof.



                                      13
<PAGE>

5.7  Independent Auditors' Annual Servicer Compliance Certificate

     The Administrator shall cause an independent auditor to furnish to the
     Administrator and the Mortgages Trustee not later than 30th April in each
     year (or, in the case of 2004, 30 June) commencing in 2004 a report
     addressed to the Board of Directors of the Administrator, substantially
     to the effect that (a) such firm has examined certain documents and
     records of the Administrator relating to the servicing of residential
     Mortgage Loans under this Agreement during the preceding calendar year,
     (b) such examination (i) included such tests and auditing procedures as
     such firm considered necessary in the circumstances, and (ii) was
     conducted in compliance with the attestation standards of the American
     Institute of Certified Public Accountants, (c) management of the
     Administrator has asserted to such firm that the Administrator has
     complied with the minimum servicing standards set out in Schedule 5 and
     (d) in the opinion of such firm, such assertion of the Administrator's
     management is fairly stated in all material respects (or, if such
     assertion of the Administrator's management is not correct, stating why
     such assertion is not correct).

6.   No Liability

6.1  No Guarantee of Mortgage Loan: The Administrator shall have no liability
     for any obligation of a Borrower under any Mortgage Loan comprised in the
     Mortgage Portfolio or any Related Security and nothing herein shall
     constitute a guarantee, or similar obligation, by the Administrator of
     any Mortgage Loan, Mortgage or any Borrower.

6.2  No Guarantee to Mortgages Trustee or Beneficiaries: Save as otherwise
     provided in this Agreement, the Administrator shall have no liability for
     the obligations of the Mortgages Trustee or the Beneficiaries under any
     of the Transaction Documents or otherwise and nothing herein shall
     constitute a guarantee, or similar obligation, by the Administrator of
     the Mortgages Trustee or the Beneficiaries in respect of any of them.

7.   New Mortgage Loans

7.1  New Mortgage Portfolio: The Mortgage Portfolio may be augmented from time
     to time by the sale and assignment to the Mortgages Trustee on any
     Distribution Date of a New Mortgage Portfolio by the Seller.

7.2  Sale and Assignment subject to Terms: The sale and assignment of each New
     Mortgage Portfolio to the Mortgages Trustee will in all cases be subject
     to the terms set out in the Mortgage Sale Agreement including, without
     limitation, the conditions set out in Clause 4 of the Mortgage Sale
     Agreement and the representations and warranties set out in Clause 8 of
     the Mortgage Sale Agreement.

8.   Product Switching and Further Advances

8.1  Acceptance of Application: The Administrator shall not accept an
     application for a Further Advance or a Product Switch without first
     having received confirmation in writing from the Seller that the Seller
     would, if invited to do so by the Mortgages Trustee, purchase the
     relevant Mortgage Loan and its Related Security from the Mortgages
     Trustee.



                                      14
<PAGE>

8.2  Notification: Subject to complying with the terms of Clause 8.1 herein,
     where the Administrator accepts a Product Switch or a Further Advance,
     the Administrator shall then promptly notify the Seller and the Mortgages
     Trustee in writing.

8.3  Existing Borrowers Re-Fix Rate: Notwithstanding Clause 8.1 herein,
     whenever Clause 8.6 of the Mortgage Sale Agreement applies to a Fixed
     Rate Mortgage Loan, the Administrator may accept an application from a
     Borrower to set the Existing Borrowers' Re-Fix Rate, subject to the terms
     of Clause 4.4 herein.

8.4  Procedures: Subject to complying with the terms of Clauses 8.1 and 8.3
     herein, the Administrator may accept requests from Borrowers for Product
     Switches and Further Advances provided that the Administrator acts in
     accordance with its then procedure which would be acceptable to a
     reasonable and prudent mortgage lender.

9.   Redemption of Mortgages

9.1  Receipt or Discharge: Upon repayment in full of all sums secured by a
     Mortgage and/or other Related Security comprised in the Mortgage
     Portfolio, the Administrator shall, and is hereby authorised by the
     Mortgages Trustee as trustee for the Beneficiaries to, execute a receipt
     or discharge or relevant Form DS1 (of the H.M. Land Registry) of the
     Mortgage and any such other or further instrument or deed of satisfaction
     regarding such Mortgage and/or the Related Security as it considers to be
     necessary or advisable and to release the relevant Title Deeds to the
     person or persons entitled thereto.

9.2  Title Deeds: The Administrator undertakes that prior to any actual
     release by it of any relevant Title Deeds it will take reasonable and
     appropriate steps to satisfy itself that the relevant Title Deeds are
     being released to the person or persons entitled thereto.

9.3  Payment of Sums Due: The Administrator shall procure that if, upon
     completion of the Enforcement Procedures, an amount in excess of all sums
     due from the relevant Borrower is recovered or received, the balance,
     after discharge of all sums due from the Borrower, is paid to the person
     or persons next entitled thereto.

10.  Powers of Attorney

10.1 Appointment: The Mortgages Trustee hereby appoints the Administrator as
     its attorney on its behalf, and in its own or the attorney's name, for
     the following purposes:

     (a)  executing all documents necessary for the purpose of discharging a
          Mortgage comprised in the Mortgage Portfolio which has been repaid
          in full and any Related Security or for the sale of a Mortgaged
          Property as Mortgagee;

     (b)  executing all documents necessary for the purpose of releasing a
          Borrower in accordance with Clause 9 herein (Redemption of
          Mortgages);

     (c)  executing all documents and doing all acts and things which in the
          reasonable opinion of the Administrator are necessary or desirable
          for the efficient provision of the Services hereunder; and

     (d)  exercising its rights, powers and discretion under the Mortgages
          including the right to fix the rate of interest payable under the
          Mortgage Loans or any


                                      15
<PAGE>

          related rights (but subject, in relation to the right to set the
          interest rate under the Base Rate Pledge and the Existing Borrowers'
          Re-Fix Rate, to the limitations, conditions and qualifications set
          out in the Mortgage Sale Agreement and the powers of attorney
          executed pursuant to it),

     provided that, for the avoidance of doubt, these Powers of Attorney shall
     not authorise the Administrator to sell any of the Mortgage Loans and/or
     their Related Security comprised in the Mortgage Portfolio except as
     specifically authorised in the Transaction Documents. For the avoidance
     of doubt, neither the Mortgages Trustee nor Funding shall be liable or
     responsible for the acts of the Administrator or any failure by the
     Administrator to act under or in respect of these Powers of Attorney.

10.2 Appointments Irrevocable: The appointments contained in Clause 10.1
     herein shall be irrevocable unless and until following a Termination
     Event pursuant to Clause 19 herein (Termination) the Mortgages Trustee
     and/or Funding and the Security Trustee serves notice pursuant to Clause
     19 herein (Termination) to terminate the Administrator's appointment
     under this Agreement upon which the appointments contained in Clause 10.1
     herein shall be automatically revoked.

11.  Costs and Expenses

     The Mortgages Trustee will on each Distribution Date reimburse, in
     accordance with Clause 10.2(b) of the Mortgages Trust Deed, the
     Administrator for all out-of-pocket costs, expenses and charges
     (inclusive of any amounts in respect of Irrecoverable VAT due thereon)
     properly incurred by the Administrator in the performance of the Services
     including any such costs, expenses or charges not reimbursed to the
     Administrator on any previous Distribution Date and the Administrator
     shall supply the Mortgages Trustee with an appropriate VAT invoice issued
     by the person making the supply.

12.  Information

12.1 Maintenance of Records:

     (a)  The Administrator shall keep the Mortgage Loan Files relating to the
          Mortgage Portfolio in safe custody and shall take appropriate
          technical and organisational measures against the unauthorised or
          unlawful processing of personal data and against accidental loss or
          destruction of, or damage to, personal data. The Administrator shall
          maintain in an adequate form such records as are necessary to
          enforce each Mortgage comprised in the Mortgage Portfolio and, where
          relevant, any other Related Security. The Administrator shall keep
          the Mortgage Loan Files in relation to the Mortgage Portfolio in
          such a way that they can be distinguished from information held by
          the Administrator for its own behalf as mortgagee or heritable
          creditor or for other third persons.

     (b)  A duplicate of any computer records held by the Administrator which
          contains information relating to the Mortgage Loans and the Related
          Security shall be lodged by the Administrator on a quarterly basis
          in a location separate from that in which the original computer
          records are stored and in an environment conducive to the safe
          storage of electronic media and which allows the


                                      16
<PAGE>

          information to be stored in an incorruptible form, such records to
          be held to the order of the Mortgages Trustee and to be replaced by
          a revised duplicate as and when the original records are revised.
          The Administrator shall keep the Mortgages Trustee informed of the
          location of the Mortgage Loan Files and duplicate computer records.

12.2 Use of information technology systems:

     (a)  The Administrator will use all reasonable endeavours to negotiate
          with the relevant parties so that any intellectual property rights
          not owned by it but used by it in connection with the performance of
          its obligations under this Agreement and in particular all software
          programmes used in connection with the Mortgage Loans and the
          Related Security therefor and their administration are licensed or
          sub-licensed to the Mortgages Trustee as trustee for the
          Beneficiaries so as to permit the Mortgages Trustee as trustee for
          the Beneficiaries to use such intellectual property rights only in
          connection with the administration of the Mortgage Loans free of
          charge for so long as any of the Mortgage Loans are outstanding. For
          the avoidance of doubt, the Administrator shall not be in breach of
          its obligations under this Agreement if such rights and/or software
          programmes are not so licensed or sub-licensed to the Mortgages
          Trustee as trustee for the Beneficiaries at any time after it has
          ceased to be the Administrator:

     (b)  If this Agreement is terminated, then for a period of six months
          following such termination (or such shorter period as may be
          necessary to allow the administration of the Mortgage Loans to be
          transferred to another person) the Administrator shall use
          reasonable endeavours to assist the Mortgages Trustee and/or the
          Beneficiaries and/or any substitute or successor Administrator to:

          (i)  establish and implement a computer system for administering the
               Mortgage Loans; and

          (ii) load the data held by the Administrator in relation to
               Borrowers and the Mortgage Loans on to such computer system,

          and, prior to (i) and (ii) having taken place, the Administrator
          will provide all necessary access and assistance to the Mortgages
          Trustee and/or the Beneficiaries and/or the substitute Administrator
          in respect of its own intellectual property rights in relation to
          the administration of the Mortgage Loans.

     (c)  Subject always to the restrictions and conditions set forth in
          Clause 16, upon termination of the appointment of the Administrator
          under this Agreement, the Administrator shall forthwith deliver to
          the Mortgages Trustee and/or the Beneficiaries and/or the substitute
          Administrator all computer and data records in its possession or
          under its control relating to the affairs of or belonging to the
          Mortgages Trustee and the Beneficiaries and/or relating to the
          Mortgage Loans and the Related Security in a form agreeable to each
          of the Administrator, the Mortgages Trustee and/or the Beneficiaries
          and/or the substitute Administrator which accords with the standard
          practice of the electronic data processing industry at the time the
          event occurs.



                                      17
<PAGE>

     (d)  The Administrator covenants that it will take no action, nor omit to
          take any action, the effect or likely effect of such action or
          omission will be to terminate any existing licence agreement in
          relation to any such intellectual property rights, provided that a
          licence agreement may be terminated if it is replaced by a
          substitute arrangement under which the intellectual property rights,
          including rights to computer software, are such that the services
          resulting therefrom are equivalent to the previous arrangement.

12.3 Access to Books and Records: Subject to all applicable laws, and subject
     always to the restrictions and conditions set forth in Clause 16, the
     Administrator shall permit the Mortgages Trustee and Funding (and their
     auditors) and the Security Trustee and any other person nominated by the
     Beneficiaries (to whom the Administrator has no reasonable objection)
     upon reasonable notice during normal office hours to have access, or
     procure that such person or persons are granted access, to all books of
     record and account (including, for the avoidance of doubt, the Title
     Deeds and Mortgage Loan Files) relating to the administration of the
     Mortgage Loans and the Related Security comprised in the Mortgage
     Portfolio and related matters in accordance with this Agreement.

12.4 Information Covenants:

     (a)  The Administrator shall, within ten (10) Business Days following
          each Payment Date, provide the Mortgages Trustee, the Beneficiaries,
          the Rating Agencies, the Lead Manager, Bloomberg, L.P. (unless
          otherwise prohibited by law) and any other party as the Mortgages
          Trustee may direct with a report in, or substantially in, the form
          set out in Schedule 2 hereto (or such other form reasonably
          requested by the Mortgages Trustee and approved by the Beneficiaries
          and the Rating Agencies) and shall assist the Cash Manager in the
          production of quarterly reports substantially in the forms set out
          in Schedule 3 of the Cash Management Agreement.

     (b)  The Administrator shall notify the Rating Agencies in writing of the
          details of (i) any material amendment to the Transaction Documents,
          (ii) any proposed material change in the valuation procedures or
          policies applied or to be applied in relation to Mortgaged
          Properties by it in connection with its mortgage business (details
          of which change may be included in a report provided under
          subparagraph (a) above) and (iii) any other information relating to
          its mortgage business and financial condition as the Rating Agencies
          may reasonably request in connection with the ratings of the First
          Issuer Notes and any New Notes and other matters contemplated by the
          Transaction, provided that such request does not adversely interfere
          with the Administrator's day to day provision of the Services under
          the other terms of this Agreement.

     (c)  The Administrator shall, at the request of Funding and the Security
          Trustee (where the Administrator is the Seller) and at the request
          of the Beneficiaries (where the Administrator is no longer the
          Seller), furnish Funding, the Security Trustee and/or the
          Beneficiaries (as appropriate) and the Rating Agencies with such
          other information relating to its business and financial condition
          as it may be reasonable for Funding, the Security Trustee and/or the
          Beneficiaries (as appropriate) to request in connection with the
          ratings of the First Issuer Notes and any New Notes and other
          matters contemplated by the


                                      18
<PAGE>

          Transaction, provided that Funding, the Security Trustee or the
          Beneficiaries (as is appropriate) shall not make such a request more
          than once every three months unless, in the belief of Funding, the
          Security Trustee or the Beneficiaries (as appropriate), an
          Intercompany Loan Event of Default or a Termination Event pursuant
          to Clause 19 herein shall have occurred and is continuing or may
          reasonably be expected to occur.

13.  Remuneration

13.1 Administration Fee: The Mortgages Trustee shall pay to the Administrator
     for its Services hereunder an administration fee (the "Administration
     Fee") (inclusive of VAT) which:

     (a)  shall be calculated in relation to each Trust Calculation Period on
          the basis of the number of days elapsed and a 365 day year (or, in
          the case of a Trust Calculation Period ending in a leap year, a 366
          day year) at the Administration Fee Rate, inclusive of VAT, on the
          aggregate amount of the Funding Share of the Trust Property as at
          close of business of such Trust Calculation Period; and

     (b)  shall be paid to the Administrator on each Distribution Date in the
          manner contemplated by and in accordance with the provisions of
          Clause 10 of the Mortgages Trust Deed.

13.2 Substitute or Successor Administrator: If a substitute or successor
     administrator shall be appointed under this Agreement with respect to any
     of the Mortgage Loans, the Mortgages Trustee shall set the Administration
     Fee Rate with such substitute or successor administrator at the time such
     substitute or successor administrator enters into an administration
     agreement.

14.  Insurances

14.1 Administration: The Administrator will administer the arrangements for
     insurance to which the Mortgages Trustee is a party or in which either
     the Seller or the Mortgages Trustee has an interest and which relate to
     the Mortgage Loans and the Mortgages comprised in the Mortgage Portfolio
     or the business of the Mortgages Trustee.

14.2 Action of Administrator: The Administrator shall not knowingly take or
     omit to take any action which would:

     (a)  result in the avoidance or termination of any of the Insurance
          Policies in relation to any Mortgage Loans and Mortgages to which
          any Insurance Policy applies;

     (b)  reduce the amount payable on any claim made on behalf of the
          Mortgages Trustee (as trustee for the Beneficiaries) under any
          Insurance Policy; or

     (c)  invalidate any Insurance Policy.

14.3 Submission of Claims: The Administrator shall prepare and submit any
     claim under the Insurance Policies in accordance with the requirements of
     the relevant Insurance Policy and otherwise with the usual procedures
     undertaken by a reasonable and prudent mortgage lender on behalf of the
     Mortgages Trustee as trustee for the


                                      19
<PAGE>

     Beneficiaries and shall comply with the other requirements of the insurer
     under the relevant Insurance Policy.

14.4 Proceeds: The Administrator shall use its reasonable endeavours to credit
     to the relevant Collection Account all proceeds received from any claim
     made under each Insurance Policy in relation to any Mortgage Loan by
     close of business on the London Business Day which immediately follows
     the day on which such amounts are received or credited by the
     Administrator (and in any event within three (3) London Business Days of
     such receipt) and which is applied either in whole or in part in
     repayment of a Mortgage Loan.

14.5 MIG Policies:

     (a)  Without prejudice to Clause 3 herein, the Mortgages Trustee as
          trustee for the Beneficiaries acknowledges that the Administrator
          may settle or compromise claims on a Mortgage Loan by Mortgage Loan
          basis in respect of any MIG Policy in a manner consistent with its
          normal practice in respect of mortgage indemnity polices, provided
          that the Administrator shall not, without the prior written consent
          of the Mortgages Trustee, settle any claims or initiate any legal
          proceedings or other legal process in respect of a group of class of
          mortgages or in respect of the MIG Policies as a whole and provided
          further that each such MIG Policy and all proceeds thereof remains
          subject to the Funding Deed of Charge.

     (b)  If the Enforcement Procedures requires the Administrator to make a
          claim under the relevant MIG Policy and the Administrator has failed
          to make such a claim, then the Beneficiaries may direct the
          Mortgages Trustee on their behalf to direct the Administrator to
          make a claim or, in default thereof by the Administrator, the
          Beneficiaries may direct the Mortgages Trustee to make a claim
          itself under such policy and the Administrator shall, within ten
          (10) London Business Days of receiving a written request from the
          Mortgages Trustee (as trustee for the Beneficiaries), provide the
          Mortgages Trustee with such information as the Mortgages Trustee may
          require to enable it to make a claim under the relevant MIG Policy.

     (c)  Without prejudice to the rights of the Administrator under Clause
          14.5(b) herein, the Administrator shall, in administering the
          Mortgage Loans, ensure that the cover under any MIG Policy relating
          to any Mortgage is not adversely affected.

14.6 Buildings Policies:

(a)  Upon receipt of notice that any Borrower whose Mortgage Loan is secured
     by a mortgage of a leasehold (or, in Scotland, a standard security of a
     long leasehold) Mortgaged Property has failed to make a payment when due
     of any sums due under the relevant lease in respect of the insurance of
     the property, the Administrator may debit such Borrower's account with
     the relevant amount which shall then be paid to the relevant landlord.

(b)  If the Administrator becomes aware that a Borrower has failed to pay
     premiums due under any Buildings Policy, the Administrator shall take
     such


                                      20
<PAGE>

     action as would a reasonable and prudent mortgage lender with a view to
     ensuring that the relevant Mortgaged Property continues to be insured in
     accordance with the applicable Mortgage Terms or the Alternative
     Insurance Requirements.

14.7 Life Policies:

     (a)  The Administrator shall use its reasonable endeavours to ensure that
          upon maturity of a Life Policy or on the death of a Borrower, if
          earlier, all sums which it is agreed between the Seller and the
          relevant Borrower are due to be paid under the Life Policy are paid
          by the relevant insurance company in repayment of the Mortgage for
          which such Life Policy is collateral security and credited to the
          relevant Collection Account.

     (b)  If so requested by a Borrower the Administrator may, on behalf of
          the Beneficiaries, exercise its discretion as a reasonable and
          prudent mortgage lender to agree to the release of a Life Policy
          from the relevant legal or equitable charge granted by the related
          Borrower in favour of the Seller.

15.  Title Deeds

15.1 Custody: The Administrator shall keep the Title Deeds relating to the
     Mortgage Portfolio in safe custody and shall not without the prior
     written consent of the Mortgages Trustee and the Beneficiaries part with
     possession, custody or control of them otherwise than to a sub-contractor
     or delegate appointed pursuant to Clause 3.2 herein (Sub-Contracts) or to
     a solicitor, licensed or qualified conveyancer or authorised
     practitioner, subject to the usual undertaking to hold them to the order
     of the Seller (who in turn will hold them to the order of the Mortgages
     Trustee (as trustee for the Beneficiaries)) or to H.M. Land Registry or
     the Registers of Scotland or, upon redemption of the relevant Mortgage
     Loan, to the order of the Borrower.

15.2 Identification: The Title Deeds relating to the Mortgage Portfolio shall
     be kept in a manner such that a computer record is maintained of their
     location and they are identifiable and retrievable by reference to an
     account number and pool identifier and identifiable and distinguishable
     from the title deeds relating to other properties and mortgages in
     respect of which the Administrator is mortgagee or heritable creditor or
     administrator.

15.3 Access: The Administrator shall provide access, or procure that access is
     provided to, the Title Deeds relating to the Mortgage Portfolio to the
     Mortgages Trustee, the Beneficiaries and their respective agents at all
     reasonable times and upon reasonable notice. The Administrator
     acknowledges that the Title Deeds and Mortgage Loan Files relating to the
     Mortgage Portfolio in its possession, custody or control will be held to
     the order of the Mortgages Trustee (as trustee for the Beneficiaries) and
     that it has, in its capacity as Administrator, no beneficial interest
     therein and the Administrator (in its capacity as such but not in its
     capacity as a Beneficiary) irrevocably waives any rights or any Security
     Interest which it might have therein or to which it might at any time be
     entitled.

15.4 Delivery upon Termination: The Administrator shall, forthwith on the
     termination of the appointment of the Administrator pursuant to Clause 19
     herein (Termination),


                                      21
<PAGE>

     deliver the Title Deeds and Mortgage Loan Files to or to the order of the
     Mortgages Trustee or to such person as the Mortgages Trustee elects as a
     substitute administrator in accordance with the terms of this Agreement
     upon written request by the Mortgages Trustee made at any time on or
     after notice of, or on or after, termination of the appointment of the
     Administrator pursuant to Clause 19 herein (Termination).

16.  Data Protection

     The Administrator represents that as at the date hereof the Administrator
     has and hereafter it will maintain on behalf of itself and on behalf of
     the Mortgages Trustee (as trustee for the Beneficiaries) all appropriate
     registrations, licences and authorities (if any) required under the Data
     Protection Act 1998 to enable each of them to perform their respective
     obligations under this Agreement. In addition to the foregoing and
     notwithstanding any of the other provisions of this Agreement, each of
     the Administrator and the Mortgages Trustee hereby agree and covenant as
     follows:

     (a)  that only non-"personal data" (as described in the Data Protection
          Act 1998) may be transferred by the Administrator to the Mortgages
          Trustee or any other entity located in Jersey (unless Jersey is
          declared an "approved state" by the European Commission, in which
          case the Administrator may transfer such personal data to the
          Mortgages Trustee in Jersey);

     (b)  that, to the extent that circumstances enable the Mortgages Trustee
          to exercise its right to demand that the Administrator transfer
          inter alia personal data to the Mortgages Trustee, the Administrator
          shall only transfer such personal data to an agent of the Mortgages
          Trustee that is located in the United Kingdom and maintains all
          appropriate registrations, licences and authorities (if any)
          required under the Data Protection Act 1998 (unless Jersey is
          declared an "approved state" by the European Commission, in which
          case the Administrator may transfer such personal data to the
          Mortgages Trustee in Jersey);

     (c)  that, to the extent that circumstances enable the Mortgages Trustee
          to exercise its right to demand that the Administrator transfer
          inter alia personal data to the Mortgages Trustee, the Administrator
          notify each Borrower that the Mortgages Trustee is a "data
          controller" (as defined in the Data Protection Act 1998) and provide
          each such Borrower with the address of the Mortgages Trustee;

     (d)  that the Administrator and the Mortgages Trustee will only use any
          data in relation to the Mortgage Loans and the related Borrowers for
          the purposes of administering and/or managing the Mortgage
          Portfolio, and will not sell such data to any third party or allow
          any third party to use such data other than in compliance with the
          conditions stated in this Clause 16 and for the sole purpose of
          administering and/or managing the Mortgage Portfolio;

     (e)  that the Mortgages Trustee will comply with the provisions of the
          Data Protection (Jersey) Law 1987 (as amended) and (so long as the
          provisions of the Data Protection Act 1998 do not conflict with the
          provisions of the Data Protection (Jersey) Law 1987) with the
          provisions of the Data Protection Act 1998 (as amended);



                                      22
<PAGE>

     (f)  that, upon the request of a Borrower, the Administrator will inform
          such Borrower that both the Administrator and the Mortgages Trustee
          are "data controllers" as described in the Data Protection Act 1998;
          and

     (g)  that both the Administrator and the Mortgages Trustee shall maintain
          a written record of their reasons for applying the Data Protection
          Order 2000 (as set forth under the Conditions under paragraph 3 of
          Part II of Schedule I of such Order).

17.  Covenants and Representations and Warranties of Administrator

17.1 Covenants: The Administrator hereby covenants with and undertakes to each
     of the Mortgages Trustee, the Beneficiaries and the Security Trustee
     that, without prejudice to any of its specific obligations hereunder, it
     will:

     (a)  administer the Mortgage Loans and their Related Security as if the
          same had not been sold and assigned to the Mortgages Trustee but had
          remained on the books of the Seller;

     (b)  provide the Services in such manner and with the same level of
          skill, care and diligence as would a reasonable and prudent mortgage
          lender;

     (c)  comply with any reasonable directions, orders and instructions which
          the Mortgages Trustee or the Beneficiaries may from time to time
          give to it in accordance with the provisions of this Agreement and,
          in the event of any conflict, those of the Mortgages Trustee shall
          prevail;

     (d)  keep in force all licences, approvals, authorisations and consents
          which may be necessary in connection with the performance of the
          Services and prepare and submit all necessary applications and
          requests for any further approval, authorisation, consent or licence
          required in connection with the performance of the Services and in
          particular any necessary registrations under the Data Protection Act
          1998;

     (e)  not knowingly fail to comply with any legal requirements in the
          performance of the Services;

     (f)  make all payments required to be made by it pursuant to this
          Agreement on the due date for payment thereof in pounds sterling (or
          as otherwise required under the Transaction Documents) in
          immediately available funds for value on such day without set-off
          (including, without limitation, any fees owed to it) or
          counterclaim, but subject to any deductions required by law;

     (g)  not without the prior written consent of the Mortgages Trustee amend
          or terminate any of the Transaction Documents save in accordance
          with their terms;

     (h)  forthwith upon becoming aware of any event which may reasonably give
          rise to an obligation of the Seller to repurchase any Mortgage Loan
          pursuant to Clause 8 of the Mortgage Sale Agreement, notify the
          Mortgages Trustee and the Beneficiaries in writing of such event;



                                      23
<PAGE>

17.2 Covenants to Survive: The covenants of the Administrator in Clause 17.1
     herein shall remain in force until this Agreement is terminated but
     without prejudice to any right or remedy of the Mortgages Trustee and/or
     the Seller and/or Funding arising from breach of any such covenant prior
     to the date of termination of this Agreement.

17.3 Representations and Warranties: The Administrator hereby makes the
     representations and warranties to each of the Mortgages Trustee, Funding
     and the Security Trustee that are specified on Schedule 3 hereto.

18.  Services Non-exclusive

     Nothing in this Agreement shall prevent the Administrator from rendering
     or performing services similar to those provided for in this Agreement to
     or for itself or other persons or from carrying on business similar to or
     in competition with the business of the Mortgages Trustee and the
     Beneficiaries.

19.  Termination

19.1 Termination Event: If any of the following events (each a "Termination
     Event") shall occur:

     (a)  default is made by the Administrator in the payment on the due date
          of any payment due and payable by it under this Agreement and such
          default continues unremedied for a period of five London Business
          Days after the Administrator becoming aware of such default;

     (b)  default is made by the Administrator in the performance or
          observance of any of its other covenants and material obligations
          under this Agreement or any of the other Transaction Documents,
          which , the Security Trustee having been informed thereof as
          specified below in this sub-clause, is materially prejudicial to the
          interests of the holders of the First Issuer Notes and any New Notes
          from time to time and such default continues unremedied for a period
          of twenty (20) days after the Administrator becoming aware of such
          default, provided however that where the relevant default occurs as
          a result of a default by any person to whom the Administrator has
          sub-contracted or delegated part of its obligations hereunder, such
          default shall not constitute a Termination Event if within such
          twenty (20) day period the Administrator replaces the relevant
          sub-contractor or delegate with an entity capable of remedying such
          default or alternatively indemnifies the Mortgages Trustee and the
          Beneficiaries against the consequences of such default;

     (c)  the Administrator at any time fails to obtain the necessary license
          or regulatory approval required by any UK mortgage regulatory regime
          which would be required in order to enable it to continue
          administering the Mortgage Loans; or

     (d)  the Administrator becomes subject to an Insolvency Event,

     then the Mortgages Trustee and/or Funding and the Security Trustee may at
     once or at any time thereafter while such default continues, by notice in
     writing to the Administrator, terminate its appointment as Administrator
     under this Agreement with effect from a date (not earlier than the date
     of the notice) specified in such notice. Upon termination of the
     Administrator, the Security Trustee shall use its reasonable


                                      24
<PAGE>

     endeavours to appoint a substitute Administrator that satisfies the
     conditions set forth in Clause 19.2(c), (d) and (e), provided that in the
     event the Security Trustee has not, having used reasonable endeavours,
     appointed a substitute Administrator, the Security Trustee shall have no
     liability to any person and, notwithstanding any other provision of the
     Transaction Documents, shall not itself be required to perform any duties
     of the Administrator.

19.2 Resignation: The Administrator may resign under this Agreement at any
     time following the expiry of not less than 12 months' notice of
     resignation given by the Administrator to the Mortgages Trustee and the
     Beneficiaries provided that:

     (a)  the Mortgages Trustee and the Beneficiaries consent in writing to
          such termination;

     (b)  a substitute administrator is appointed by the Mortgages Trustee,
          Funding and the Security Trustee (and in the event of failure to
          agree, by the Security Trustee), such appointment to be effective
          not later than the date of such termination (and the Administrator
          shall notify the Rating Agencies in writing of the identity of such
          substitute administrator);

     (c)  if possible, such substitute administrator has experience of
          administering mortgages of residential property in England, Wales
          and Scotland and is approved by the Mortgages Trustee and the
          Beneficiaries;

     (d)  such substitute administrator enters into an agreement on
          substantially the same terms as the relevant provisions of this
          Agreement and the Administrator shall not be released from its
          obligations under the relevant provisions of this Agreement until
          such substitute administrator has entered into such new agreement;
          and

     (e)  the then current ratings (if any) of the First Issuer Notes or any
          New Notes are not adversely affected as a result thereof, unless
          otherwise agreed by an Extraordinary Resolution (as defined in the
          Note Trust Deed) of the holders of the relevant class of Notes.

19.3 Termination of Authority: On and after resignation by, or termination of
     the appointment of, the Administrator under this Agreement pursuant to
     this Clause 19, all authority and power of the Administrator under this
     Agreement shall be terminated and be of no further effect and the
     Administrator shall not thereafter hold itself out in any way as the
     agent of the Mortgages Trustee and/or the Beneficiaries pursuant to this
     Agreement.

19.4 Delivery of Files: Upon resignation by, or termination of the appointment
     of, the Administrator under this Agreement pursuant to this Clause 19,
     the Administrator shall:

     (a)  forthwith deliver to (and in the meantime hold on trust for, and to
          the order of) the Mortgages Trustee or as it shall direct the
          Mortgage Loan Files, the Title Deeds, all books of account, papers,
          records, registers, correspondence and documents in its possession
          or under its control relating to the affairs of, or belonging to,
          the Mortgages Trustee (as trustee for the Beneficiaries) and the


                                      25
<PAGE>

          Mortgages in the Mortgage Portfolio and any other Related Security,
          (if practicable, on the date of receipt) any monies then held by the
          Administrator on behalf of the Mortgages Trustee and any other
          assets of the Mortgages Trustee as trustee for the Beneficiaries;

     (b)  take such further action as the Mortgages Trustee, Funding and the
          Security Trustee may reasonably direct at the expense of the
          Beneficiaries (including in relation to the appointment of a
          substitute administrator) provided that neither the Mortgages
          Trustee nor the Security Trustee shall be required to take or direct
          to be taken such further action unless it has been indemnified to
          its satisfaction;

     (c)  provide all relevant information contained on computer records in
          the form of magnetic tape, together with details of the layout of
          the files encoded on such magnetic tapes; and

     (d)  co-operate and consult with and assist the Mortgages Trustee,
          Funding, the Security Trustee and their nominees (which shall, for
          the avoidance of doubt, include any new administrator appointed by
          any of them) for the purposes of explaining the file layouts and the
          format of the magnetic tapes generally containing such computer
          records on the computer system of the Mortgages Trustee or such
          nominee.

19.5 Notification of Termination Event: The Administrator shall notify the
     Mortgages Trustee, the Security Trustee and the Beneficiaries as soon as
     reasonably practicable but in any event within five (5) days of becoming
     aware of any Termination Event or any event which with the giving of
     notice or lapse of time or certification would constitute the same. Such
     notification shall specify which event in Clause 19 occurred and was the
     cause of such Termination Event (or any event which with the giving of
     notice or lapse of time or certification would constitute a Termination
     Event), a description of the details of such Termination Event, and a
     reference to the provision in this Agreement or the other Transaction
     Documents which the Administrator has breached.

19.6 No Prejudice: Termination of this Agreement or the appointment of the
     Administrator under this Agreement shall be without prejudice to the
     liabilities of the Mortgages Trustee as trustee for the Beneficiaries to
     the Administrator or vice versa incurred before the date of such
     termination. The Administrator shall have no right of set-off or any lien
     in respect of such amounts against amounts held by it on behalf of the
     Mortgages Trustee.

19.7 Automatic Termination: This Agreement shall terminate at such time as the
     Mortgages Trustee has no further interest in any of the Mortgage Loans or
     the Mortgages which have been comprised in the Mortgage Portfolio.

19.8 Further Compensation: Upon resignation by, or termination of the
     appointment of, the Administrator under the provisions of this Clause 19,
     the Administrator shall be entitled to receive all fees and other monies
     accrued up to the date of resignation or termination, as the case may be,
     but shall not be entitled to any other or further compensation. Such
     monies so receivable by the Administrator shall be paid by the Mortgages
     Trustee on the dates on which they would otherwise have fallen due


                                      26
<PAGE>

     hereunder. For the avoidance of doubt, such resignation or termination
     shall not affect the Administrator's rights to receive payment of all
     amounts (if any) due to it from the Mortgages Trustee other than under
     this Agreement.

19.9 Co-operation: Prior to termination of this Agreement, the Administrator,
     the Seller, the Mortgages Trustee and Funding shall co-operate to obtain
     the agreement of the Borrowers to a new bank mandate permitting the
     Mortgages Trustee to operate the Direct Debiting Scheme.

19.10 Survival of Terms: Any provision of this Agreement which is stated to
     continue after termination of the Agreement shall remain in full force
     and effect notwithstanding termination.

19.11 No Supervision: The Security Trustee shall not be obliged to monitor or
     supervise the performance by any substitute Administrator of its duties
     hereunder or in relation to the other Transaction Documents, nor shall
     the Security Trustee be responsible or liable for any act or omission of
     such substitute Administrator or for any loss caused thereby.

20.  Further Assurances

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

20.2 Powers of Attorney: Without prejudice to the generality of Clause 20.1
     herein, the Mortgages Trustee as trustee for the Beneficiaries shall upon
     request by the Administrator forthwith give to the Administrator such
     further powers of attorney or other written authorisations, mandates or
     instruments as are necessary to enable the Administrator to perform the
     Services.

20.3 Notice to Rating Agencies: In the event that there is any change in the
     identity of the Mortgages Trustee or an additional Mortgages Trustee is
     appointed, the remaining Mortgages Trustee and/or the retiring Mortgages
     Trustee, as the case may be, shall execute such documents with any other
     parties to this Agreement and take such actions as such new Mortgages
     Trustee may reasonably require for the purposes of vesting in such new
     Mortgages Trustee the rights of the Mortgages Trustee under this
     Agreement and releasing the retiring Mortgages Trustee from further
     obligations thereunder and while any Note remains outstanding shall give
     notice thereof to the Rating Agencies.

20.4 No Obligations: Nothing herein contained shall impose any obligation or
     liability on the Mortgages Trustee to assume or perform any of the
     obligations of the Administrator hereunder or render it liable for any
     breach hereof.

21.  Miscellaneous

21.1 Insufficient Funds: Subject to Clause 21.2 herein, in the event that the
     funds available to the Mortgages Trustee on any Payment Date are not
     sufficient to satisfy in full the aggregate amount payable to the
     Administrator by the Mortgages Trustee on such Payment Date then the
     amount payable to the Administrator on such Payment


                                      27
<PAGE>

     Date shall be reduced by the amount of the shortfall and such shortfall
     shall (subject always to the provisions of this Clause 21) be payable on
     the immediately succeeding Payment Date.

21.2 Reduction of Fees: In the event that:

     (a)  after redemption in full of the Intercompany Loans; or

     (b)  after service of an Intercompany Loan Enforcement Notice and payment
          of all other prior claims,

     the remaining sums available to the Mortgages Trustee or remaining
     proceeds of enforcement are insufficient to satisfy in full the
     outstanding fees or other claims of the Administrator, such fees shall be
     reduced by the amount of the deficiency.

21.3 Set-Off: Each of the Seller and the Administrator agrees that it will
     not:

     (a)  set off or purport to set off any amount which the Mortgages
          Trustee, Funding or each Issuer is or will become obliged to pay to
          it under any of the Transaction Documents against any amount from
          time to time standing to the credit of or to be credited to any
          Collection Account, the Mortgages Trustee Transaction Account, the
          Mortgages Trustee GIC Account, the Funding Transaction Account, the
          Funding GIC Account, any Funding (Issuer) GIC Account, any Issuer
          Transaction Account in any other account prior to transfer to any
          Collection Account, the Mortgages Trustee Transaction Account, the
          Mortgages Trustee GIC Account, the Funding Transaction Account, the
          Funding GIC Account, any Funding (Issuer) GIC Account or any Issuer
          Transaction Account, as appropriate; or

     (b)  make or exercise any claims or demands, any rights of counterclaim
          or any other equities against or withhold payment of any and all
          sums of money which may at any time and from time to time be
          standing to the credit of any Collection Account, the Mortgages
          Trustee Transaction Account, the Mortgages Trustee GIC Account, the
          Funding Transaction Account, the Funding GIC Account, any Funding
          (Issuer) GIC Account or any Issuer Transaction Account.

21.4 No Petition: The Administrator agrees that for so long as any First
     Issuer Notes and New Notes are outstanding it will not petition nor
     commence proceedings for the administration or winding up of the
     Mortgages Trustee or Funding or any Issuer nor participate in any ex
     parte proceedings with regard thereto.

21.5 Limited Recourse: In relation to all sums due and payable by the
     Mortgages Trustee to the Administrator, the Administrator agrees that it
     shall have recourse only to sums paid to or received by (or on behalf of)
     the Mortgages Trustee pursuant to the provisions of the Mortgage Sale
     Agreement, the other Transaction Documents and in relation to the
     Mortgages.

21.6 No Prejudice: For the avoidance of doubt, neither Beneficiary shall be
     liable to pay any amounts due under Clauses 11 or 13 herein without
     prejudice to the obligations of the Mortgages Trustee in respect of such
     amounts.



                                      28
<PAGE>

21.7 Termination: Notwithstanding any other provisions of this Agreement, all
     obligations to, and rights of, Funding under or in connection with this
     Agreement (other than its obligations under Clause 22 herein
     (Confidentiality)) shall automatically terminate upon the discharge in
     full of all amounts owing by it under any Intercompany Loan Agreement,
     provided that this shall be without prejudice to any claims in respect of
     such obligations and rights arising on or prior to such date.

22.  Confidentiality

     From the date of this Agreement and notwithstanding its termination, each
     of the Mortgages Trustee and the Beneficiaries shall use its best
     endeavours not to disclose to any person whatsoever any information
     relating to the business, finances or other matters of a confidential
     nature of any other party hereto of which it may by virtue of being party
     to the Transaction Documents have become possessed and shall use all
     reasonable endeavours to prevent any such disclosure as aforesaid,
     provided however that the provisions of this Clause 22 shall not apply:

     (a)  to any information already known to the Mortgages Trustee or the
          Beneficiaries otherwise than as a result of entering into any of the
          Transaction Documents;

     (b)  to any information subsequently received by the Mortgages Trustee or
          the Beneficiaries which it would otherwise be free to disclose;

     (c)  to any information which is or becomes public knowledge otherwise
          than as a result of the conduct of the Mortgages Trustee or the
          Beneficiaries;

     (d)  to any extent that the Mortgages Trustee or the Beneficiaries is
          required to disclose the same pursuant to any Transaction Document,
          pursuant to any law or order of any court or pursuant to any
          direction, request or requirement (whether or not having the force
          of law) of any central bank or any governmental or other authority
          (including, without limitation, any official bank examiners or
          regulators);

     (e)  to the extent that the Mortgages Trustee or the Beneficiaries needs
          to disclose the same for determining the existence of, or declaring,
          an Intercompany Loan Event of Default or a Termination Event, the
          protection or enforcement of any of its rights under any of the
          Transaction Documents or in connection herewith or therewith or for
          the purpose of discharging, in such manner as it thinks fit, its
          duties under or in connection with such agreements in each case to
          such persons as require to be informed of such information for such
          purposes; or

     (f)  in relation to any information disclosed to the professional
          advisers of the Mortgages Trustee or the Beneficiaries or (in
          connection with the review of current ratings of the First Issuer
          Notes or any New Notes or with a prospective rating of any debt to
          be issued by an Issuer) to any credit rating agency or any
          prospective new Administrator or Mortgages Trustee.



                                      29
<PAGE>

23.  No Partnership

     It is hereby acknowledged and agreed by the parties that nothing in this
     Agreement shall be construed as giving rise to any partnership between
     any of the parties.

24.  Assignment

24.1 Consent: The Mortgages Trustee may not assign or transfer any of its
     rights and obligations under this Agreement without the prior written
     consent of each of the Beneficiaries.

24.2 Agreement: The Administrator may not assign or transfer any of its rights
     or obligations under this Agreement (a) without the prior written consent
     of the Mortgages Trustee (as trustee for the Beneficiaries) and each of
     the Beneficiaries and (b) other than to a person who agrees to be bound
     by the provisions contained in Clause 5 of the Funding Deed of Charge as
     if such person had been named as an original party thereto in place of
     Northern Rock but without prejudice to their obligations under such
     Clause.

24.3 Assignment of Rights to Security Trustee: The Administrator acknowledges
     that Funding has assigned its rights under this Agreement to the Security
     Trustee pursuant to the Funding Deed of Charge and acknowledges that
     pursuant to the terms of the Funding Deed of Charge, Funding has, inter
     alia, authorised the Security Trustee, following the Funding Security
     becoming enforceable, to exercise, or refrain from exercising, all of
     Funding's rights, powers, authorities, discretions and remedies under or
     in respect of the Funding Transaction Documents, including this
     Agreement, in such manner as in the Security Trustee's absolute
     discretion it shall think fit.

25.  Security Trustee; Authorised Third Party

25.1 Vesting of Rights: If there is any change in the identity of the security
     trustee in accordance with the Funding Deed of Charge, the Administrator,
     the Seller, Funding and the Mortgages Trustee shall execute such
     documents and take such action as the successor security trustee and the
     outgoing security trustee may reasonably require for the purpose of
     vesting in the successor security trustee the rights and obligations of
     the outgoing security trustee under this Agreement and releasing the
     outgoing security trustee from its future obligations under this
     Agreement.

25.2 No Assumption: It is hereby acknowledged and agreed that by its execution
     of this Agreement the Security Trustee shall not assume or have any of
     the obligations or liabilities of the Administrator, the Seller, Funding
     or the Mortgages Trustee under this Agreement. Furthermore, any liberty
     or power which may be exercised or any determination which may be made
     hereunder by the Security Trustee may be exercised or made in the
     Security Trustee's absolute discretion without any obligation to give
     reasons therefor, but in any event must be exercised or made in
     accordance with the provisions of the Funding Deed of Charge and Schedule
     4 hereto.

25.3 Delegation: The Security Trustee may delegate the performance of all or
     any of its powers and obligations under all or any of the Operating
     Agreements pursuant to the terms of Schedule 4 of this Agreement and
     subject always to the provisions of the Funding Deed of Charge.



                                      30
<PAGE>

26.  New Intercompany Loan Agreements

     If Funding enters into a New Intercompany Loan Agreement, then the
     Administrator, the Seller, Funding, the Security Trustee and the
     Mortgages Trustee shall execute such documents and take such action as
     may be necessary or required by the Rating Agencies for the purpose of
     including the New Issuer, any Basis Rate Swap Provider, any Currency Swap
     Provider, any New Start-up Loan Provider and any other person who has
     executed an Accession Undertaking or any New Intercompany Loan Agreement
     in the Transaction Documents.

27.  Non Petition Covenant; Limited Recourse

27.1 Non Petition Covenant: Each of the parties hereto hereby agrees that it
     shall not institute against either Funding or the Mortgages Trustee any
     winding-up, administration, insolvency or similar proceedings so long as
     any sum is outstanding under any Intercompany Loan Agreement of any
     Issuer or for two years plus one day since the last day on which any such
     sum was outstanding.

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

     (a)  in relation to the Mortgages Trustee, any amount payable by the
          Mortgages Trustee to any other party to this Agreement under this
          Agreement not being an amount payable out of the Trust Property in
          accordance with the terms of the Mortgages Trust Deed shall only be
          payable to the extent that on that date the Mortgages Trustee has
          sufficient funds to pay such amount out of fees paid to it under the
          Mortgages Trust Deed; and

     (b)  in relation to Funding:

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

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

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

27.3 Corporate Obligations: To the extent permitted by law, no recourse under
     any obligation, covenant, or agreement of any person contained in this
     Agreement shall be


                                      31
<PAGE>

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

28.  Amendments and Waiver

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

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

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

28.4 Variation or Waiver: No variation or waiver of this Agreement shall be
     made if the same would adversely affect the then current ratings of` any
     of the Notes.

29.  Notices

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

     (a)  in the case of the Administrator and the Seller, to Northern Rock
          PLC, Northern Rock House, Gosforth, Newcastle upon Tyne NE3 4PL
          (facsimile number: 0191 213 2203) for the attention of the Group
          Secretary;



                                      32
<PAGE>

     (b)  in the case of the Mortgages Trustee, to Granite Finance Trustees
          Limited, c/o 22 Grenville Street, St. Helier, Jersey JE4 8PX,
          Channel Islands (facsimile number 01534-609-333) for the attention
          of the Company Secretary;

     (c)  in the case of Funding, to Granite Finance Funding Limited, 69 Park
          Lane, Croydon CR8 1TQ (facsimile number 020 8409 8911) for the
          attention of the Company Secretary;

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

     (e)  in the case of Fitch, to Fitch Ratings Ltd., at Eldon House, 2 Eldon
          Street, London EC2M 7UA (facsimile number 0207 7417 6262) for the
          attention of European Structured Finance Surveillance;

     (f)  in the case of Moody's, to Moody's Investors Services, Inc., at 1st
          Floor, 2 Minster Court, Mincing Lane, London EC3R 7XB (facsimile
          number 0207 772 5400) for the attention of Jodi van Breda;

     (g)  in the case of S&P, to Standard & Poor's Ratings Services, a
          division of The McGraw-Hill Companies, Inc., at Garden House, 18
          Finsbury Circus, London EC2M 7NJ (facsimile number 0207-826-3598)
          for the attention of Andre Vollmann;

     or to such other address or facsimile number or for the attention of such
     other person or entity as may from time to time be notified by any party
     or by any Rating Agency to the others by written notice in accordance
     with the provisions of this Clause 29. All notices served under this
     Agreement shall be simultaneously copied to the Security Trustee by the
     person serving the same.

30.  Third Party Rights

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

31.  Execution in Counterparts; Severability

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

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



                                      33
<PAGE>

32.  Governing Law and Submission to Jurisdiction

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

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

33.  Process Agent

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

34.  Appropriate Forum

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

IN WITNESS WHEREOF the parties have caused this Agreement to be executed as a
deed the day and year first before written.



                                      34
<PAGE>

                                  SCHEDULE 1

                                 THE SERVICES

In addition to the Services set out in the body of the Administration
Agreement, the Administrator shall:

(a)  keep records (written or computerised) and books of account for the
     Mortgages Trustee in relation to the Mortgage Loans comprised in the
     Mortgage Portfolio;

(b)  keep records for all taxation purposes and VAT;

(c)  notify relevant Borrowers of any change in their Monthly Payments;

(d)  assist the auditors of the Mortgages Trustee and provide information to
     them upon reasonable request;

(e)  provide a redemption statement to a Borrower or any person acting on the
     Borrower's behalf, in each case upon written request or otherwise at the
     discretion of the Administrator;

(f)  notify relevant Borrowers of any other matter or thing which the
     applicable Mortgage Conditions or Offer Conditions require them to be
     notified of in the manner and at the time required by the relevant
     Mortgage Terms;

(g)  subject to the provisions of this Agreement (including without limitation
     Clause 5.2 herein (Administration and Enforcement of Mortgages) take all
     reasonable steps to recover all sums due to the Mortgages Trustee
     including without limitation by the institution of proceedings and/or the
     enforcement of any Mortgage Loan comprised in the Mortgage Portfolio or
     any New Mortgage Portfolio or any Related Security;

(h)  take all other action and do all other things which it would be
     reasonable to expect a reasonable and prudent mortgage lender to do in
     administering its mortgages;

(i)  keep a Mortgage Account for each Mortgage Loan which shall record all
     proceeds received in respect of that Mortgage Loan and all amounts
     debited to such Mortgage Account;

(j)  at its discretion, prepare and send on request an annual statement to
     Borrowers in relation to each calendar year in the agreed form; and

(k)  assist the Cash Manager in the preparation of a quarterly report
     substantially in the form set out in the Cash Management Agreement.



                                      35
<PAGE>

                                  SCHEDULE 2

                      FORM OF INVESTORS' QUARTERLY REPORT

Granite Finance Trustees Limited
Monthly Report

Date of Report [  ]

Mortgages

Number of Mortgages in Pool                                                [  ]

Current Balance                                                       (GBP)[  ]

Opening Trust Assets                                                  (GBP)[  ]


Funding Share                                                         (GBP)[  ]

Funding Share Percentage                                                   [  ]%

Seller Share                                                          (GBP)[  ]

Seller Share Percentage                                                    [  ]%

Minimum Seller Share (Amount)                                         (GBP)[  ]

Minimum Seller Share (% of Total)                                          [  ]%


Arrears Analysis of Non Repossessed Mortgages

                             Number               Principal              Arrears

Less than [  ] month         [  ]                 [  ]                   [  ]

[  ] - [  ] months           [  ]                 [  ]                   [  ]

[  ] - [  ] months           [  ]                 [  ]                   [  ]

[  ] - [  ] months           [  ]                 [  ]                   [  ]

[  ] - [  ] months           [  ]                 [  ]                   [  ]

[  ] months +                [  ]                 [  ]                   [  ]

Total                        [  ]                 [  ]                   [  ]





                                      36
<PAGE>




Properties in Possession     Number               Principal              Arrears

Total                        [  ]                 [  ]                   [  ]

Properties in Possession

Number Brought Forward                                                   [  ]

Repossessed                                                              [  ]

Sold                                                                     [  ]

Number Carried Forward                                                   [  ]

Average Time from                                                        [  ]
Possession to Sale

Average Arrears at Sale                                                  [  ]

Repossessed                                                              [  ]

MIG Claims Submitted                                                     [  ]

MIG Claims Outstanding                                                   [  ]

Average Time from Claim to Payment                                       [  ]

Note: The arrears analysis and repossession information is as at close of
business for the report month

Substitution                                  Number                  Principal

Substituted this period (this month)          [  ]                    [  ]

Substituted to dated (since [  ])             [  ]                    [  ]

CPR Analysis                                  Monthly                 Annualised

Current [  ] Month CPR Rate                   [  ]%                   [  ]%

Previous [  ] Month CPR Rate                  [  ]%                   [  ]%

Weighted Average Seasoning (by value)         [  ]

Average Loan Size                             [  ]

Weighted Average LTV (by value)               [  ]%



                                      37
<PAGE>

Product Breakdown

Fixed Rate                                    [  ]%

Flexible -Together                            [  ]%

LTV Levels Breakdown                          Number                    Value

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ] - [  ]%                                  [  ]                      [  ]

[  ]% +                                       [  ]                      [  ]

Totals                                        [  ]                      [  ]

NR Current Existing Borrowers' SVR                                      [  ]

Effective Date of Change                                                [  ]


                                      38
<PAGE>

<TABLE>
<CAPTION>
                                              Rating
Notes            Outstanding                  Moodys/S&P/Fitch               Reference Rate
<S>              <C>                          <C>                        <C>                 <C>
Series 1

A1               $XXX,XXX,XXX                  Aaa/AAA/AAA                 X.XXX%               X.XX%

A2               $XXX,XXX,XXX                  Aaa/AAA/AAA                 X.XXX%               X.XX%

B                $ XX,XXX,XXX                   Aa3/AA/AA                  X.XXX%               X.XX%

C                $ XX,XXX,XXX                  Baa2/BBB/BBB                X.XXX%               X.XX%

Series 2

A            (GBP)XXX,XXX,XXX                  Aaa/AAA/AAA                 X.XXX%               X.XX%

B            (GBP) XX,XXX,XXX                   Aa3/AA/AA                  X.XXX%               X.XX%

C            (GBP) XX,XXX,XXX                  Baa2/BBB/BBB                X.XXX%               X.XX%

Issuer Reserve Fund Requirement                                                             (GBP)[  ]

Balance brought forward                                                                     (GBP)[  ]

Drawings this period

Reserve Fund Top-up this period*                                                            (GBP)[  ]

Excess Spread                                                                               (GBP)[  ]

Current Balance                                                                             (GBP)[  ]

*Top-ups only occur at the end of each quarter.

Funding Reserve Balance                                                                     (GBP)[  ]

Funding Reserve %                                                                                [  ]%
</TABLE>



                                      39
<PAGE>

                                  SCHEDULE 3

                 ADMINISTRATOR REPRESENTATIONS AND WARRANTIES

The Administrator makes the following representations and warranties to each
of the Mortgages Trustee, Funding and the Security Trustee:

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

2.   Powers and authority: It has the power to enter into, perform and
     deliver, and has taken all necessary corporate and other action to
     authorise the execution, delivery and performance by it of each of the
     Transaction Documents to which it is or will be a party, and each such
     Transaction Document has been duly executed and delivered by it.

3.   Legal validity: Each Transaction Document to which it is or will be a
     party constitutes or when executed in accordance with its terms will
     constitute its legal, valid and binding obligation.

4.   Non-conflict: The execution by it of each of the Transaction Documents to
     which it is a party and the exercise by it of its rights and the
     performance of its obligations under such Transaction Documents will not:

     (a)  result in the existence or imposition of, nor oblige it to create,
          any Security Interest in favour of any person over all or any of its
          present or future revenues or assets;

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

     (c)  conflict with its constitutional documents; or

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

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

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

7.   Solvency: No Insolvency Event has occurred in respect of the
     Administrator, and the Administrator is not insolvent.



                                      40
<PAGE>

8.   Financial Statements: The most recent financial statements of the
     Administrator:

     (a)  were prepared in accordance with accounting principles generally
          accepted in England and Wales consistently applied;

     (b)  disclose all liabilities (contingent or otherwise) and all
          unrealised and or anticipated losses of the Administrator; and

     (c)  save as disclosed therein, give a true and fair view of the
          financial condition and operations of the Administrator during the
          relevant financial year.

9.   No Adverse Change: Since the date as of which the most recent financial
     statements of the Administrator were stated to be prepared, there has
     been:

     (a)  no significant change in the financial position of the
          Administrator; and

     (b)  no material adverse change in the financial position or prospects of
          the Administrator.

10.  Ranking of Claims

     Under the laws of England and Wales in force as at the date of making
     this representation, claims against the Administrator under the
     Transaction Documents will rank at least pari passu with the claims of
     all its other unsecured and unsubordinated creditors, save those whose
     claims are preferred solely by any bankruptcy, liquidation or other
     similar laws of general application.

11.  Information in Prospectus and Offering Circular:

     (a)  All information in the Prospectus and the Offering Circular with
          regard to the Administrator, its business and its experience
          administering mortgage loans (including its arrears and repossession
          experience) are true and accurate in all material respects and not
          misleading in any material respect.

     (b)  Any opinions, predictions and intentions expressed in the Prospectus
          and/or the Offering Circular on the part of the Administrator are
          honestly held and not misleading in any material respect.

     (c)  Each of the Prospectus and the Offering Circular does not omit to
          state any material fact necessary to make such information,
          opinions, predictions or intentions not misleading in any material
          respect.

     (d)  The Administrator has made all proper inquiries to ascertain and to
          verify the foregoing.



                                      41
<PAGE>


                                  SCHEDULE 4

                            AUTHORISED THIRD PARTY

1.   Agreement to Allow Delegation

1.1. The Seller and the Administrator agree (subject to the other provisions
     of this Schedule, including paragraph 2 (Appointment and Payment) and
     subject to the Funding Deed of Charge) that the Security Trustee may
     appoint or facilitate the appointment of an Authorised Third Party to
     implement, administer and carry out the duties and powers of the Security
     Trustee:

     (a)  under the Seller's Power of Attorney;

     (b)  in connection with and following a Completion Event; and

     (c)  in connection with and following a Termination Event,

     (together the "Back-up Functions")

1.2. Each of the Seller and the Administrator shall authorise the Authorised
     Third Party on their behalf and in their name or otherwise to sign or
     execute or make any alteration or addition or deletion in or to any
     agreements or documents or certificates or instructions or notices which
     they are entitled or required to give, receive, implement, transact or
     become a party to in relation to the Back-up Functions or for doing any
     other act or thing required to be done by them under or in connection
     with the Back-up Functions and otherwise generally to sign, seal and
     deliver any agreement, assurance, document, certificate, instruction or
     act which may be required by the Authorised Third Party acting in
     connection with the Back-up Functions.

2.   Appointment and Payment

     The appointment of the Authorised Third Party shall be on the terms and
     conditions as negotiated between the Security Trustee, the Seller and/or
     the Administrator (as the case may be) and such Authorised Third Party.
     The fees, costs and expenses payable to such Authorised Third Party shall
     be considered as part of the additional remuneration and expenses of the
     Security Trustee and therefore shall be payable in the manner
     contemplated by and in accordance with Clause 18 of the Funding Deed of
     Charge from funds that the Security Trustee receives in accordance with
     the Funding Priority of Payments as set forth in the Funding Deed of
     Charge.

3.   Delegation

3.1. The Security Trustee shall use reasonable endeavours (in its opinion) to
     appoint in writing one or more persons to act as an Authorised Third
     Party in respect of the Back-up Functions (on any terms other than the
     power to appoint a delegate), and references in the Operating Agreements
     to the "Security Trustee" shall be construed accordingly and, unless the
     context does not permit, include any Authorised Third Party. Any such
     appointment of an Authorised Third Party may be revoked by the Security
     Trustee at any time.



                                      42
<PAGE>

3.2. In the event that the Security Trustee has not, having used such
     reasonable endeavours, appointed such Authorised Third Party, the
     Security Trustee shall have no liability to any person and,
     notwithstanding any other provision of the Operating Agreements, shall
     not itself be required to perform any Back-up Functions or any other
     duties of the Seller or the Administrator either during the period it is
     seeking to appoint an Authorised Third Party or thereafter.

3.3. As condition precedents to the appointment of the Authorised Third Party,
     the arrangements to be entered into between the Authorised Third Party
     and the Seller or Administrator (as the case may be) shall provide that
     (1) the Authorised Third Party shall make timely transfer of information
     to the Seller or Administrator (as appropriate); and (2) the Security
     Trustee shall provide any Authorised Third Party with a copy of the
     Operating Agreements and the Funding Deed of Charge and shall request
     such Authorised Third Party to confirm in writing to the Seller, the
     Administrator and the Security Trustee that it has read and understood
     the terms of this Agreement and the other Operating Agreements.

4.   Ratification

     Each of the Seller and the Administrator shall, upon the written request
     of the Security Trustee or such Authorised Third Party, ratify and
     confirm all documents, deeds, certificates, instructions, acts and things
     which the Security Trustee or such Authorised Third Party shall execute
     or do in the exercise of any of the powers conferred, or purported to be
     conferred, on him by this Agreement and the other Operating Agreements.
     The terms of appointment of the Authorised Third Party shall oblige the
     Authorised Third Party to provide information concerning its activities
     on a regular basis and on request to the Seller, Administrator, Funding
     and the Security Trustee.

5.   Limitations on the Responsibility of the Security Trustee

     The Security Trustee shall not be obliged to monitor or supervise the
     performance by such Authorised Third Party of its duties hereunder or in
     relation to the Operating Agreements and shall not be responsible or
     liable for any act or omission of such Authorised Third Party or for any
     loss caused thereby, provided that if any party to a Transaction Document
     notifies the Security Trustee that an Authorised Third Party appointed by
     the Security Trustee is implementing, administering or carrying out the
     duties and powers of the Security Trustee in breach of the terms and
     conditions of the relevant Operating Agreement pursuant to which such
     duties and powers are to be performed, the Security Trustee shall use its
     reasonable endeavours to appoint or facilitate the appointment of a
     substitute Authorised Third Party to implement, administer and carry out
     such duties and powers. The terms of appointment of an Authorised Third
     Party and the Security Trustee's responsibilities in relation thereto as
     set out in this Schedule 4 shall apply to the appointment of a substitute
     Authorised Third Party. Nothing in this Schedule constitutes the Security
     Trustee in its role as specified in this schedule as trustee or fiduciary
     for any person. The Security Trustee shall assume, until it receives
     notice thereof pursuant to the relevant Operating Agreement, that no
     Back-up Trigger Event has occurred and until such time that it receives
     such notification and is first indemnified and/or secured to its
     satisfaction, is not entitled to take any action in respect of the
     Back-up Functions under the Operating Agreements.



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<PAGE>

6.   Exoneration

6.1. Without limiting paragraph 6.2 below, the Security Trustee shall not be
     liable to any Person for any action taken or not taken by the Security
     Trustee or such Authorised Third Party under or in connection with the
     Operating Agreements, other than in respect of any loss, liability,
     claim, expense or damage suffered or incurred by such Person in respect
     of the gross negligence or wilful default of the Security Trustee or such
     Authorised Third Party in carrying out its functions under the relevant
     Operating Agreement.

6.2. No Person may take any proceedings against any officer, employee or agent
     of the Security Trustee in respect of any claim it might have against the
     Security Trustee in respect of any act or omission of any kind by their
     officer, employee or agent.



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<PAGE>

                                  SCHEDULE 5

                          MINIMUM SERVICING STANDARDS

The following list sets forth (i) certain of the Services provided for in the
body of the Administration Agreement and (ii) certain of the functions
required of the Cash Manager under the terms of the Cash Management Agreement,
which together are known as the "minimum servicing standards" for purposes of
Section 5.7 of the Administration Agreement.

1.   (Maintain records) keep and maintain records in relation to the Mortgage
     Portfolio on a Mortgage Loan by Mortgage Loan basis for the purposes of
     identifying amounts paid by each Borrower, any amount due from a Borrower
     and the balance from time to time outstanding on a Borrower's account
     (5.3).

2.   (Collections) using reasonable endeavours credit all monthly payments
     made by a Borrower to the relevant Collection Account within three (3)
     London Business Days of receipt (5.1).

3.   (Qualifications and compliance of laws) maintain all licences, approvals,
     authorisations and consents necessary in connection with the
     Administrator's performance of its obligations under the Administration
     Agreement and not knowingly to fail to comply with any legal requirements
     in the performance of those obligations. (17.1(d) and (e)).

4.   (Enforcement) in relation to any default by a Borrower under a Mortgage
     Loan or a Mortgage, enforce the terms of such Mortgage Loan or Mortgage
     in accordance with the Enforcement Procedures and as otherwise provided
     in the Administration Agreement (5.2).

5.   (Insurance) (a) administer the arrangements for insurance in which the
     Mortgages Trustee or the Seller has an interest (14.1); (b) not knowingly
     take or omit to take any action that could result in avoidance,
     termination or invalidity of any Insurance Policy in relation to any
     Mortgage Loans and Mortgages or reduce the amount payable on any claim
     made on behalf of the Mortgage Trustees under any Insurance Policy
     (14.2); (c) prepare and submit any claim under the Insurance Policies in
     accordance with their terms (14.3); and (d) use reasonable endeavours to
     credit all proceeds received under any Insurance Policy to the relevant
     Collection Account within three (3) London Business Days of such receipt
     (14.4).

6.   (Determination of interest rates) (a) determine the Standard Variable
     Rate chargeable to Borrowers from time to time and the Existing
     Borrowers' Re-Fix Rate in accordance with section 4.1 of the
     Administration Agreement; and (b) take all steps necessary pursuant to
     the relevant Mortgage Conditions or applicable law to bring such change
     in the Standard Variable Rate to the attention of the relevant borrowers
     and notify details of such change to the Mortgages Trustee, the Security
     Trustee and the Beneficiaries (4.2).

7.   (Provision of information) provide such information from its records in
     relation to the Mortgage Loans to the Mortgages Trustee, Funding or the
     Security Trustee at any


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<PAGE>

     time upon reasonable notice, subject to the conditions set forth in the
     Administration Agreement (5.3).

8.   (Access to books and records) permit the Mortgages Trustee, Funding (and
     their auditors) and the Security Trustee and any other person nominated
     by the beneficiaries (to whom the Administrator has no reasonable
     objection) upon reasonable notice during normal office hours to have
     access to all books of record and account (including Title Deeds and
     Mortgage Loan Files) relating to the administration of the Mortgage Loans
     and the Related Security, subject to applicable law and the conditions
     set forth in the Administration Agreement (12.3).

9.   (Custody of records) keep the Mortgage Loan Files relating to the
     Mortgage Portfolio in safe custody and shall take appropriate technical
     and organisational measures against the unauthorised or unlawful
     processing of personal data and against accidental loss or destruction
     of, or damage to, personal data. The Administrator shall maintain in an
     adequate form such records as are necessary to enforce each Mortgage
     comprised in the Mortgage Portfolio and, where relevant, any other
     Related Security. The Administrator shall keep the Mortgage Loan Files in
     relation to the Mortgage Portfolio in such a way that they can be
     distinguished from information held by the Administrator for its own
     behalf as mortgagee or heritable creditor or for other third persons
     (12.1(a)).

10.  (Ledgers)

     (a)  establish and maintain memorandum ledgers in the books of the
          Mortgages Trustee to enable the ongoing identification and
          segregation of principal, revenue, and overpayments;

     (b)  on a monthly basis ensure that the memorandum ledgers are reconciled
          to the Mortgages Trustee Bank Accounts;

     (c)  establish and maintain memorandum ledgers in the books of the
          Funding to enable the ongoing identification and segregation of
          principal, revenue, Funding Reserve Amounts and Issuer Reserve
          Amounts;

     (d)  on a monthly basis ensure that the memorandum ledgers are reconciled
          to the Funding Bank Accounts; and

     (e)  establish and maintain ledgers in the books of the Funding and each
          Issuer to record the Initial Intercompany Loans and subsequent
          payments of interest and principal on each of the Intercompany
          Loans.





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<PAGE>

                                EXECUTION PAGE

as Administrator
EXECUTED for and on behalf of       )
NORTHERN ROCK PLC                   )
by:                                 )

____________________________
Authorised Signatory

Name:

Title:

as Seller
EXECUTED for and on behalf of       )
NORTHERN ROCK PLC                   )
by:                                 )

____________________________
Authorised Signatory

Name:

Title:

EXECUTED for and on behalf of       )
GRANITE FINANCE TRUSTEES LIMITED    )
by:                                 )

____________________________
Authorised Signatory

Name:

Title:

EXECUTED for and on behalf of       )
GRANITE FINANCE FUNDING LIMITED     )
by:                                 )

____________________________
Authorised Signatory

Name:

Title:




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