--------------------------------------------------------------------------------
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                           IMPAC SECURED ASSETS CORP.,
                                    Company,


                            IMPAC FUNDING CORPORATION
                                Master Servicer,


                                       and


                    BANKERS TRUST COMPANY OF CALIFORNIA, N.A.
                                     Trustee




                        _________________________________


                         POOLING AND SERVICING AGREEMENT

                            Dated as of April 1, 2001

                        _________________________________


                       Mortgage Pass-Through Certificates

                                  Series 2001-3





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--------------------------------------------------------------------------------

<PAGE>



<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS
                                                 -----------------
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
ARTICLE I

         DEFINITIONS..............................................................................................5
         1.01.  Defined Terms.....................................................................................5
         Accrual Period...........................................................................................5
         Advance  ................................................................................................5
         Aggregate Stated Principal Balance.......................................................................5
         Agreement................................................................................................5
         Allocated Realized Loss Amount...........................................................................5
         Anniversary..............................................................................................5
         Assignment...............................................................................................5
         Available Distribution Amount............................................................................5
         Balloon Loan.............................................................................................6
         Balloon Payment..........................................................................................6
         Bankruptcy Code..........................................................................................6
         Basic Principal Distribution Amount......................................................................6
         Book-Entry Certificate...................................................................................6
         Business Day.............................................................................................6
         Buydown Funds............................................................................................6
         Buydown Mortgage Loan....................................................................................6
         Cash Liquidation.........................................................................................6
         Certificate..............................................................................................7
         Certificate Account......................................................................................7
         Certificate Account Deposit Date.........................................................................7
         Certificateholder" or "Holder............................................................................7
         Certificate Owner........................................................................................7
         Certificate Principal Balance............................................................................7
         Certificate Register.....................................................................................8
         Class    ................................................................................................8
         Class A Certificate......................................................................................8
         Class A-1 Certificate....................................................................................8
         Class A-1 Net WAC Rate...................................................................................8
         Class A-2 Certificate....................................................................................8
         Class A-2 Net WAC Rate...................................................................................8
         Class A-IO Rate..........................................................................................8
         Class A-IO Certificate...................................................................................8
         Class A Principal Distribution Amount....................................................................8
         Class B Certificate......................................................................................9
         Class B Principal Distribution Amount....................................................................9
         Class C Certificate......................................................................................9
         Class M-1 Certificate....................................................................................9
         Class M-1 Principal Distribution Amount.................................................................10


                                                         i

<PAGE>



         Class M-2 Certificate...................................................................................10
         Class M-2 Principal Distribution Amount.................................................................10
         Class P Certificate.....................................................................................11
         Class R Certificate.....................................................................................11
         Class R-1 Interest......................................................................................11
         Class R-2 Interest......................................................................................11
         Class R-3 Interest......................................................................................11
         Closing Date............................................................................................11
         Code     ...............................................................................................11
         Collateral Value........................................................................................11
         Commission..............................................................................................11
         Company  ...............................................................................................11
         Compensating Interest...................................................................................11
         Corporate Trust Office..................................................................................11
         Corresponding Certificate...............................................................................12
         Current Specified Overcollateralization Percentage......................................................12
         Curtailment.............................................................................................12
         Custodial Account.......................................................................................12
         Cut-off Date............................................................................................12
         Defaulted Mortgage Loan.................................................................................12
         Deficient Valuation.....................................................................................12
         Definitive Certificate..................................................................................12
         Deleted Mortgage Loan...................................................................................12
         Depository..............................................................................................12
         Depository Participant..................................................................................13
         Determination Date......................................................................................13
         Disqualified Organization...............................................................................13
         Distribution Date.......................................................................................13
         Due Date ...............................................................................................13
         Due Period..............................................................................................13
         Eligible Account........................................................................................13
         Event of Default........................................................................................14
         Excess Overcollateralized Amount........................................................................14
         Excess Proceeds.........................................................................................14
         Extra Principal Distribution Amount.....................................................................14
         Fannie Mae..............................................................................................14
         FDIC     ...............................................................................................14
         Fitch    ...............................................................................................14
         Freddie Mac.............................................................................................14
         Funding Date............................................................................................14
         GMAC     ...............................................................................................14
         Group 1 Loan............................................................................................14
         Group 2 Loan............................................................................................15
         Group 1 Marker Rate.....................................................................................15
         Group 1 Net WAC Rate....................................................................................15
         Group 2 Marker Rate.....................................................................................15


                                                        ii

<PAGE>



         Group 2 Net WAC Rate....................................................................................16
         Initial Certificate Principal Balance...................................................................16
         Initial Notional Amount.................................................................................16
         Insurance Policy........................................................................................16
         Insurance Proceeds......................................................................................16
         Interest Remittance Amount..............................................................................17
         Late Collections........................................................................................17
         Liquidated Mortgage Loan................................................................................17
         Liquidation Proceeds....................................................................................17
         Loan-to-Value Ratio.....................................................................................17
         Lost Note Affidavit.....................................................................................17
         Majority Class C Certificateholder......................................................................17
         Master Servicer.........................................................................................17
         Master Servicer Prepayment Charge Payment Amount........................................................17
         Servicing Fees..........................................................................................17
         Servicing Fee Rate......................................................................................18
         Maximum Uncertificated Accrued Interest Deferral Amount.................................................18
         Mezzanine Certificate...................................................................................19
         Mezzanine Net WAC Rate..................................................................................19
         Monthly Interest Distributable Amount...................................................................19
         Monthly Payment.........................................................................................19
         Moody's  ...............................................................................................19
         Mortgage ...............................................................................................19
         Mortgage File...........................................................................................20
         Mortgage Loan...........................................................................................20
         Mortgage Loan Purchase Agreement........................................................................20
         Mortgage Loan Schedule..................................................................................20
         Mortgage Note...........................................................................................21
         Mortgage Rate...........................................................................................21
         Mortgaged Property......................................................................................21
         Mortgagor...............................................................................................21
         Net Liquidation Proceeds................................................................................22
         Net Monthly Excess Cashflow.............................................................................22
         Net Mortgage Rate.......................................................................................22
         Net Prepayment Interest Shortfall.......................................................................22
         Net WAC Rate............................................................................................22
         Nonrecoverable Advance..................................................................................22
         Non-United States Person................................................................................23
         Notional Amount.........................................................................................23
         Officers' Certificate...................................................................................23
         Opinion of Counsel......................................................................................23
         Optional Termination Date...............................................................................23
         OTS      ...............................................................................................23
         Outstanding Mortgage Loan...............................................................................23
         Overcollateralization Deficiency Amount.................................................................23
         Overcollateralization Release Amount....................................................................24


                                                        iii

<PAGE>



         Overcollateralization Target Amount.....................................................................24
         Overcollateralized Amount...............................................................................24
         Ownership Interest......................................................................................24
         Pass-Through Rate.......................................................................................24
         Percentage Interest.....................................................................................26
         Permitted Investment....................................................................................26
         Permitted Transferee....................................................................................28
         Person   ...............................................................................................28
         Prepayment Assumption...................................................................................28
         Prepayment Charge.......................................................................................28
         Prepayment Interest Shortfall...........................................................................28
         Prepayment Period.......................................................................................28
         Primary Hazard Insurance Policy.........................................................................28
         Primary Insurance Policy................................................................................28
         Principal Distribution Amount...........................................................................29
         Principal Prepayment....................................................................................29
         Principal Prepayment in Full............................................................................29
         Principal Remittance Amount.............................................................................29
         Prospectus Supplement...................................................................................29
         Purchase Price..........................................................................................29
         Qualified Insurer.......................................................................................29
         Qualified Substitute Mortgage Loan......................................................................30
         Radian   ...............................................................................................30
         Radian Insured Loans....................................................................................30
         Radian Lender-Paid PMI Policy...........................................................................30
         Radian PMI Policy Rate..................................................................................30
         Rating Agency...........................................................................................30
         Realized Loss...........................................................................................31
         Record Date.............................................................................................31
         Regular Certificate.....................................................................................31
         Relief Act..............................................................................................31
         Relief Act Interest Shortfall...........................................................................31
         REMIC    ...............................................................................................31
         REMIC 1  ...............................................................................................31
         REMIC 1 Regular Interest LT1A...........................................................................32
         REMIC 1 Regular Interest LT1B...........................................................................32
         REMIC 1 Regular Interest LT1C...........................................................................32
         REMIC 1 Regular Interest LT1D...........................................................................32
         REMIC 1 Regular Interest LT1P...........................................................................32
         REMIC 1 Regular Interests...............................................................................32
         REMIC 2  ...............................................................................................33
         REMIC 2 Group 1 Interest Loss Allocation Amount.........................................................33
         REMIC 2 Group 2 Interest Loss Allocation Amount.........................................................33
         REMIC 2 Group 1 Overcollateralized Amount...............................................................33
         REMIC 2 Group 2 Overcollateralized Amount...............................................................33
         REMIC 2 Group 1 Principal Loss Allocation Amount........................................................33


                                                        iv

<PAGE>



         REMIC 2 Group 2 Principal Loss Allocation Amount........................................................34
         REMIC 2 Overcollateralization Target Amount.............................................................34
         REMIC 2 Regular Interest LT2A...........................................................................34
         REMIC 2 Regular Interest LT2A-IO........................................................................34
         REMIC 2 Regular Interest LT2B...........................................................................34
         REMIC 2 Regular Interest LT2C...........................................................................34
         REMIC 2 Regular Interest LT2D...........................................................................34
         REMIC 2 Regular Interest LT2E...........................................................................35
         REMIC 2 Regular Interest LT2F...........................................................................35
         REMIC 2 Regular Interest LT2G...........................................................................35
         REMIC 2 Regular Interest LT2H...........................................................................35
         REMIC 2 Regular Interest LT2I...........................................................................35
         REMIC 2 Regular Interest LT2J...........................................................................35
         REMIC 2 Regular Interest LT2K...........................................................................36
         REMIC 2 Regular Interest LT2L...........................................................................36
         REMIC 2 Regular Interest LT2P...........................................................................36
         REMIC 2 Regular Interests...............................................................................36
         REMIC 3  ...............................................................................................36
         REMIC Provisions........................................................................................36
         REMIC Regular Interest..................................................................................36
         Remittance Report.......................................................................................36
         REO Acquisition.........................................................................................37
         REO Disposition.........................................................................................37
         REO Imputed Interest....................................................................................37
         REO Proceeds............................................................................................37
         REO Property............................................................................................37
         Request for Release.....................................................................................37
         Residual Interest.......................................................................................37
         Responsible Officer.....................................................................................37
         Seller   ...............................................................................................37
         Servicing Account.......................................................................................37
         Servicing Advances......................................................................................38
         Servicing Guide.........................................................................................38
         Servicing Officer.......................................................................................38
         Single Certificate......................................................................................38
         Special Deposit.........................................................................................38
         Standard & Poor's.......................................................................................38
         Startup Day.............................................................................................38
         Stated Principal Balance................................................................................38
         Stepdown Date...........................................................................................39
         Sub-Servicer............................................................................................39
         Sub-Servicer Remittance Date............................................................................39
         Sub-Servicing Account...................................................................................39
         Sub-Servicing Agreement.................................................................................39
         Sub-Servicing Fees......................................................................................39
         Sub-Servicing Fee Rate..................................................................................39


                                                         v

<PAGE>



         Substitution Adjustment.................................................................................39
         Tax Returns.............................................................................................39
         Transfer ...............................................................................................40
         Transferor..............................................................................................40
         Trigger Event...........................................................................................40
         Trust Fund..............................................................................................40
         Trustee  ...............................................................................................40
         Trustee's Fee...........................................................................................40
         Trustee Fee Rate........................................................................................40
         Uncertificated Accrued Interest.........................................................................41
         Uncertificated Notional Amount..........................................................................41
         Uncertificated Principal Balance........................................................................41
         Uncertificated Pass-Through Rate........................................................................41
         Uncertificated REMIC 1 Pass-Through Rate................................................................41
         Uncertificated REMIC 2 Pass-Through Rate................................................................41
         Uninsured Cause.........................................................................................42
         United States Person....................................................................................42
         Unpaid Interest Shortfall Amount........................................................................42
         Voting Rights...........................................................................................43
         Weighted Average Net Mortgage Rate......................................................................43
         Wendover ...............................................................................................43
         1.02     Allocation of Certain Interest Shortfalls......................................................43

ARTICLE II

         CONVEYANCE OF MORTGAGE LOANS;
         ORIGINAL ISSUANCE OF CERTIFICATES.......................................................................45
         2.01.    Conveyance of Mortgage Loans...................................................................45
         2.02.    Acceptance of the Trust Fund by the Trustee....................................................48
         2.03.    Representations, Warranties and Covenants of the Master Servicer and the
                  Company........................................................................................49
         2.04.    Representations and Warranties of the Seller...................................................51
         2.05.    Issuance of Certificates; Conveyance of  REMIC Regular Interests and
                  Acceptance of REMIC 2 by the Trustee...........................................................53

ARTICLE III

         ADMINISTRATION AND SERVICING
         OF THE TRUST FUND.......................................................................................55
         3.01.    Master Servicer to Act as Master Servicer......................................................55
         3.02.    Sub-Servicing Agreements Between Master Servicer and Sub-Servicers.............................56
         3.03.    Successor Sub-Servicers........................................................................58
         3.04.    Liability of the Master Servicer...............................................................58
         3.05.    No Contractual Relationship Between Sub-Servicers and Trustee or
                  Certificateholders.............................................................................58
         3.06.    Assumption or Termination of Sub-Servicing Agreements by Trustee...............................59


                                                        vi

<PAGE>



         3.07.    Collection of Certain Mortgage Loan Payments...................................................59
         3.08.    Sub-Servicing Accounts.........................................................................60
         3.09.    Collection of Taxes, Assessments and Similar Items; Servicing Accounts.........................61
         3.10.    Custodial Account..............................................................................61
         3.11.    Permitted Withdrawals From the Custodial Account...............................................62
         3.12.    Permitted Investments..........................................................................63
         3.13.    Maintenance of Primary Hazard Insurance. ......................................................64
         3.14.    Enforcement of Due-on-Sale Clauses; Assumption Agreements......................................66
         3.15.    Realization Upon Defaulted Mortgage Loans......................................................67
         3.16.    Trustee to Cooperate; Release of Mortgage Files................................................68
         3.17.    Servicing Compensation.........................................................................69
         3.18.    Maintenance of Certain Servicing Policies......................................................70
         3.19.    Annual Statement as to Compliance..............................................................71
         3.20.    Annual Independent Public Accountants' Servicing Statement.....................................71
         3.21.    Access to Certain Documentation................................................................72
         3.22.    Title, Conservation and Disposition of REO Property............................................72
         3.23.    Additional Obligations of the Master Servicer..................................................74
         3.24     [Reserved].....................................................................................74
         3.25.    Additional Obligations of the Company..........................................................74
         3.26.    Periodic Filings with the Securities and Exchange Commission; Additional
                  Information....................................................................................75
         3.27.    Administration of Buydown Funds................................................................75

ARTICLE IV

         PAYMENTS TO CERTIFICATEHOLDERS..........................................................................77
         4.01.    Distributions..................................................................................77
         4.02.    Statements to Certificateholders...............................................................82
         4.03.    Remittance Reports; Advances by the Master Servicer............................................84
         4.04.    Distributions on the REMIC Regular Interests...................................................86
         4.05.    Allocation of Realized Losses..................................................................89
         4.06.    Information Reports to Be Filed by the Master Servicer.........................................90
         4.07.    Compliance with Withholding Requirements.......................................................90

ARTICLE V

         THE CERTIFICATES........................................................................................92
         5.01.    The Certificates...............................................................................92
         5.02.    Registration of Transfer and Exchange of Certificates..........................................94
         5.03.    Mutilated, Destroyed, Lost or Stolen Certificates..............................................98
         5.04.    Persons Deemed Owners..........................................................................98
         5.05.    Rule 144A Information..........................................................................99

ARTICLE VI

         THE COMPANY AND THE MASTER SERVICER....................................................................100


                                                        vii

<PAGE>



         6.01.    Liability of the Company and the Master Servicer..............................................100
         6.02.    Merger, Consolidation or Conversion of the Company or the Master Servicer
                   .............................................................................................100
         6.03.    Limitation on Liability of the Company, the Master Servicer and Others........................100
         6.04.    Limitation on Resignation of the Master Servicer..............................................101
         6.05.    Sale and Assignment of Master Servicing.......................................................101

ARTICLE VII

         DEFAULT................................................................................................103
         7.01.    Events of Default.............................................................................103
         7.02.    Trustee to Act; Appointment of Successor......................................................105
         7.03.    Notification to Certificateholders............................................................105
         7.04.    Waiver of Events of Default...................................................................106
         7.05.    List of Certificateholders....................................................................106

ARTICLE VIII

         CONCERNING THE TRUSTEE.................................................................................107
         8.01.    Duties of Trustee.............................................................................107
         8.02.    Certain Matters Affecting the Trustee.........................................................108
         8.03.    Trustee Not Liable for Certificates or Mortgage Loans.........................................109
         8.04.    Trustee May Own Certificates..................................................................110
         8.05.    Trustee's Fees................................................................................110
         8.06.    Eligibility Requirements for Trustee..........................................................110
         8.07.    Resignation and Removal of the Trustee........................................................111
         8.08.    Successor Trustee.............................................................................112
         8.09.    Merger or Consolidation of Trustee............................................................112
         8.10.    Appointment of Co-Trustee or Separate Trustee.................................................112

ARTICLE IX

         TERMINATION............................................................................................114
         9.01.    Termination Upon Repurchase or Liquidation of All Mortgage Loans or upon
                  Purchase of Certificates......................................................................114
         9.02.    Termination of REMIC 2 and REMIC 3............................................................116
         9.03.    Additional Termination Requirements...........................................................116

ARTICLE X

         REMIC PROVISIONS.......................................................................................117
         10.01.   REMIC Administration..........................................................................117
         10.02.   Prohibited Transactions and Activities........................................................119
         10.03.   Master Servicer and Trustee Indemnification...................................................120



                                                       viii

<PAGE>



ARTICLE XI

         MISCELLANEOUS PROVISIONS...............................................................................121
         11.01.   Amendment.....................................................................................121
         11.02.   Recordation of Agreement; Counterparts........................................................122
         11.03.   Limitation on Rights of Certificateholders....................................................122
         11.04.   Governing Law.................................................................................123
         11.05.   Notices.......................................................................................123
         11.06.   Severability of Provisions....................................................................124
         11.07.   Successors and Assigns........................................................................124
         11.08.   Article and Section Headings..................................................................124
         11.09.   Notice to Rating Agencies.....................................................................124
</TABLE>

<TABLE>
<CAPTION>
         Signatures
         Acknowledgments
<S>                        <C>
         Exhibit A         Form of Class A Certificate
         Exhibit B-1       Form of Class M and Class B Certificate
         Exhibit B-2       Form of Class P Certificate
         Exhibit B-3       Form of Class C Certificate
         Exhibit B-4       Form of Class R Certificate
         Exhibit C         Form of Trustee Initial Certification
         Exhibit D         Form of Trustee Final Certification
         Exhibit E         Form of Remittance Report
         Exhibit F-1       Request for Release
         Exhibit F-2       Request for Release for Mortgage Loans Paid in Full
         Exhibit G-1       Form of Investor Representation Letter
         Exhibit G-2       Form of Transferor Representation Letter
         Exhibit G-3       Form of Rule 144A Investment Representation
         Exhibit G-4       Transferor Certificate for Transfers of Residual Certificates
         Exhibit G-5       Transfer Affidavit and Agreement for Transfers of Residual Certificates
         Exhibit G-6       Form of Investor Representation Letter for Insurance Companies
         Exhibit H         Mortgage Loan Schedule
         Exhibit I         Seller Representations and Warranties
         Exhibit J         Form of Notice Under Section 3.25
         Exhibit K         Impac Funding Corporation Servicing Guide
</TABLE>


                                       ix

<PAGE>



                  This Pooling and Servicing Agreement, dated and effective as
of April 1, 2001, among Impac Secured Assets Corp., as company (the "Company"),
Impac Funding Corporation, as master servicer (the "Master Servicer"), and
Bankers Trust Company of California, N.A., as trustee (the "Trustee").

                             PRELIMINARY STATEMENT:

                  The Company intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust Fund created hereunder. The Certificates will consist of nine classes
of certificates, designated as (i) the Class A-1 Certificates, (ii) the Class
A-2 Certificates, (iii) the Class A-IO Certificates, (iv) the Class M-1
Certificates, (v) the Class M-2 Certificates, (vi) the Class B Certificates,
(vii) the Class P Certificates, (viii) the Class C Certificates and (ix) the
Class R Certificates.

                                     REMIC 1
                                     -------

         As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement as a real estate mortgage investment
conduit (a "REMIC") for federal income tax purposes, and such segregated pool of
assets will be designated as "REMIC 1." The Class R-1 Interest will represent
the sole class of "residual interests" in REMIC 1 for purposes of the REMIC
Provisions (as defined herein) under federal income tax law. The following table
irrevocably sets forth the designation, the Uncertificated REMIC 1 Pass-Through
Rate, the initial Uncertificated Principal Balance, and solely for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the "latest possible
maturity date" for each of the REMIC 1 Regular Interests. None of the REMIC 1
Regular Interests will be certificated.


<TABLE>
<CAPTION>
    Designation          Uncertificated REMIC 1          Initial Uncertificated             Assumed Final
                            Pass-Through Rate               Principal Balance             Maturity Date (1)
                            -----------------               -----------------             -----------------
<S>                      <C>                             <C>                              <C>
       LT1A                    Variable(2)                    $178,213,115.52                May 2031
       LT1B                    Variable(2)                    $  1,235,997.41                May 2031
       LT1C                   Variable (2)                    $    564,135.07                May 2031
       LT1D                    Variable(2)                    $ 20,000,000.00                May 2031
       LT1P                    Variable(2)                    $        100.00                May 2031
</TABLE>

___________________
(1)      Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
         regulations, the Distribution Date in the month of the maturity date
         for the Mortgage Loan with the latest maturity date has been designated
         as the "latest possible maturity dfor each REMIC 1 Regular Interest.
(2)      Calculated in accordance with the definition of "Uncertificated REMIC 1
         Pass-Through Rate" herein.







<PAGE>




                                     REMIC 2
                                     -------

         As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the REMIC 1 Regular Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC 2". The Class R-2 Interest will represent the sole class of
"residual interests" in REMIC 2 for purposes of the REMIC Provisions.

         The following table irrevocably sets forth the designation, the
Uncertificated REMIC 2 Pass- Through Rate, the initial Uncertificated Principal
Balance, and solely for purposes of satisfying Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the REMIC 2
Regular Interests. None of the REMIC 2 Regular Interests will be certificated.


<TABLE>
<CAPTION>
                         Uncertificated REMIC 2         Initial Uncertificated                 Assumed Final
    Designation             Pass-Through Rate              Principal Balance                 Maturity Date (1)
    -----------             -----------------              -----------------                 -----------------
<S>                      <C>                            <C>                                  <C>
       LT2A                   Variable(2)                   $134,585,362.94                       May 2031
       LT2B                   Variable(2)                   $   1,266,500.00                      May 2031
       LT2C                   Variable(2)                   $      41,925.34                      May 2031
       LT2D                   Variable(2)                   $      34,302.55                      May 2031
       LT2E                   Variable(2)                   $      30,491.16                      May 2031
       LT2F                   Variable(2)                   $   1,373,421.78                      May 2031
       LT2G                   Variable(2)                   $  61,427,620.10                      May 2031
       LT2H                   Variable(2)                   $     593,500.00                      May 2031
       LT2I                   Variable(2)                   $      13,074.66                      May 2031
       LT2J                   Variable(2)                   $      10,697.45                      May 2031
       LT2K                   Variable(2)                   $       9,508.84                      May 2031
       LT2L                   Variable(2)                   $     626,844.18                      May 2031
      LT2A-IO                 Variable(3)                         N/A(4)                          May 2031
       LT2P                   Variable(2)                   $         100.00                      May 2031
</TABLE>

___________________
(1)      Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
         regulations, the Distribution Date in the month following the maturity
         date for the Mortgage Loan with the latest maturity date has been
         designated as the "latest possible maturity date" for each REMIC 2
         Regular Interest.

(2)      Calculated in accordance with the definition of "Uncertificated REMIC 2
         Pass-Through Rate" herein.

(3)      The excess of (i) the Weighted Average Net Mortgage Rate over (ii) the
         excess (but not less than zero) of (x) the Weighted Average Net
         Mortgage Rate over (y) 8.00% per annum.

(4)      REMIC 2 Regular Interest LT2A-IO will not have an Uncertificated
         Principal Balance, but will accrue interest on its Uncertificated
         Notional Amount outstanding from time to time which shall equal the
         Uncertificated Principal Balance of REMIC 1 Regular Interest LT1D.



                                        2

<PAGE>





                                     REMIC 3
                                     -------

         As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the REMIC 2 Regular Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC 3". The Class R-3 Interest will represent the sole class of
"residual interests" in REMIC 3 for purposes of the REMIC Provisions.

         The following table irrevocably sets forth the Class designation,
Pass-Through Rate and Initial Certificate Principal Balance for each Class of
Certificates that represents one or more of the "regular interests" in REMIC 3
created hereunder:



<TABLE>
<CAPTION>
                                          Initial
                                   Certificate Principal              Pass-Through                Assumed Final
      Class Designation                   Balance                         Rate                   Maturity Date(1)
<S>                                <C>                                <C>                        <C>
Class A-1                            $126,650,000.00                   Variable(2)                   May 2031
Class A-2                            $ 59,350,000.00                   Variable(2)                   May 2031
Class M-1                            $  5,500,000.00                   Variable(2)                   May 2031
Class M-2                            $  4,500,000.00                   Variable(2)                   May 2031
Class B                              $  4,000,000.00                   Variable(2)                   May 2031
                                     $     13,248.00                                                 May 2031
Class C                                       (3)                      Variable(2)
Class A-IO                               N/A (4)                       Variable(2)                   May 2031
Class P                              $        100.00                      N/A(5)                     May 2031
</TABLE>

___________________
(1)      Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
         regulations, the Distribution Date in the month following the maturity
         date for the Mortgage Loan with the latest maturity date has been
         designated as the "latest possible maturity date" for each Class of
         Certificates that represents one or more of the "regular interests" in
         REMIC 3.

(2)      Calculated in accordance with the definition of "Pass-Through Rate"
         herein.

(3)      The Class C Certificates will accrue interest at their variable
         Pass-Through Rate on the Notional Amount of the Class C Certificates
         outstanding from time to time which shall equal the aggregate of the
         Uncertificated Principal Balances of the REMIC 2 Regular Interests.
         The Class C Certificates will not accrue interest on their Certificate
         Principal Balance.

(4)      The Class A-IO Certificates do not have a Certificate Principal Balance
         and are not entitled to distributions of principal. The Class A-IO
         Certificates accrue interest on a Notional Amount calculated in
         accordance with the definition of "herein.

(5)      The Class P Certificates do not accrue interest.


         Using the Structuring Assumptions (as defined in the Prospectus
Supplement) and assuming prepayments at 0% of the Prepayment Assumption, the
final scheduled Distribution Date on each Class of Certificates would be as
follows: (i) for the Certificates (other than the Class A-IO Certificates), the
Distribution Date in April 2031; and (ii) for the Class A-IO Certificates, the
Distribution Date in October 2003.


                                        3

<PAGE>



         Due to Realized Losses, principal prepayments (including Principal
Prepayments, liquidations of defaulted Mortgage Loans, repurchases of Mortgage
Loans) and other differences between the Structuring Assumptions and the actual
behavior that the Mortgage Loans will exhibit during the period that they are
held in the Trust Fund, the final scheduled Distribution Date on each Class of
Certificates may be substantially earlier or later than the dates indicated in
the preceding paragraph. The failure of any Class of Certificates to be retired
on or before the applicable date indicated in the preceding paragraph shall not
constitute an Event of Default or a breach by any party hereto, nor shall any
Certificateholder (or the Trustee on behalf of any Certificateholder) be
entitled to any remedy for such failure. The termination of the Trust Fund and
the final distribution on any Class of the Certificates shall only occur in
accordance with the provisions of Section 4.01 and Article IX of this Agreement.


                                        4

<PAGE>



                                    ARTICLE I

                                   DEFINITIONS

                  SECTION 1.01.  Defined Terms.

                  Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the meanings
specified in this Article. Unless otherwise specified, all calculations in
respect of interest on the Class A Certificates, the Mezzanine Certificates, the
Class C Certificates, the REMIC 1 Regular Interests and the REMIC 2 Regular
Interests shall be made on the basis a 360-day year consisting of twelve 30-day
months. The Class P Certificates and the Class R Certificates do not accrue
interest.

                  "Accrual Period": With respect to each Class of Regular
Certificates (other than the Class P Certificates) and each Distribution Date,
the calendar month prior to the month of such Distribution Date.

                  "Advance": As to any Mortgage Loan, any advance made by the
Master Servicer on any Distribution Date pursuant to Section 4.03.

                  "Aggregate Stated Principal Balance": As of any date of
determination, the aggregate Stated Principal Balance of the Mortgage Loans.

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

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

                  "Anniversary": Each anniversary of April 1, 2001.

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

                  "Available Distribution Amount": With respect to any
Distribution Date, an amount equal to (a) the sum of (i) the balance on deposit
in the Custodial Account as of the close of business on the related
Determination Date, (ii) the aggregate amount of any Advances made and all
amounts required to be paid by the Master Servicer pursuant to Sections 3.13 and
3.23 by deposits into the Certificate Account on the immediately preceding
Certificate Account Deposit Date, (iii) the aggregate amount of Mortgage Loan
purchases made pursuant to Section 9.01 and (iv) the aggregate amount required
to be deposited by the Master Servicer pursuant to Section 4.01(h), reduced by
(b)


                                        5

<PAGE>



the sum, as of the close of business on the related Determination Date, of (i)
Monthly Payments collected but due during a Due Period subsequent to the Due
Period ending on the first day of the month of the related Distribution Date,
(ii) all interest or other income earned on deposits in the Custodial Account or
the Certificate Account, (iii) any other amounts reimbursable or payable to the
Trustee, Master Servicer or any Sub-Servicer pursuant to Section 3.11, (iv) the
Master Servicing Fees, the Sub-Servicing Fees and the fees of the Trustee
payable on such Distribution Date, (v) any amounts in respect of the premium
payable to Radian under the Radian Lender-Paid PMI P(vi) Insurance Proceeds,
Liquidation Proceeds, Principal Prepayments, REO Proceeds and the proceeds of
Mortgage Loan purchases made pursuant to Section 2.02, 2.04, 3.14 or 3.22, in
each case received or made after the first day of the month of such Distribution
Date and (vii) amounts on deposit in the Custodial Account representing any
Prepayment Charges or Master Servicer Prepayment Charge Payment Amounts.

                  "Balloon Loan": Each of the Mortgage Loans identified in the
Mortgage Loan Schedule as having an original term to maturity that is shorter
than the related amortization term.

                  "Balloon Payment": With respect to any Balloon Loan, the
related Monthly Payment payable on the stated maturity date of such Balloon
Loan.

                  "Bankruptcy Code":  The Bankruptcy Code of 1978, as amended.

                  "Basic Principal Distribution Amount": With respect to any
Distribution Date, the excess of (i) the Principal Remittance Amount for such
Distribution Date over (ii) the Overcollateralization Release Amount, if any,
for such Distribution Date.

                  "Book-Entry Certificate": Any Certificate registered in the
name of the Depository or its nominee.

                  "Business Day": Any day other than a Saturday, Sunday or a day
on which banking institutions in California or New York (and such other state or
states in which the Custodial Account or the Certificate Account are at the time
located) or in the city in which the Corporate Trust Office of the Trustee is
located are authorized or obligated by law or executive order to close.

                  "Buydown Funds": Any amount contributed by the seller of a
Mortgaged Property, the Company or other source in order to enable the Mortgagor
to reduce the payments required to be made from the Mortgagor's funds in the
early years of a Mortgage Loan. Buydown Funds anot part of the Trust Fund prior
to deposit into the Custodial or Certificate Account.

                  "Buydown Mortgage Loan": Any Mortgage Loan as to which a
specified aof interest is paid out of related Buydown Funds in accordance with a
related buydown agreement.

                  "Cash Liquidation": As to any defaulted Mortgage Loan other
than a Mortgage Loan as to which an REO Acquisition occurred, a determination by
the Master Servicer that it has received


                                        6

<PAGE>



all Insurance Proceeds, Liquidation Proceeds and other payments or cash
recoveries which the Master Servicer reasonably and in good faith expects to be
finally recoverable with respect to such Mortgage Loan.

                  "Certificate": Any Regular Certificate or Class R Certificate.

                  "Certificate Account": The trust account or accounts created
and maintained pursuant to Section 4.01, which shall be entitled "Bankers Trust
Company of California, N.A., in trust for registered holders of Impac Secured
Assets Corp., Mortgage Pass-Through Certificates, Series 2001- 3, and which
account or accounts must each be an Eligible Account.

                  "Certificate Account Deposit Date": With respect to any
Distribution Date, the third Business Day immediately preceding such
Distribution Date.

                  "Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that only a
Permitted Transferee shall be a holder of a Residual Certificate for any
purposes hereof and, solely for the purposes of giving any consent pursuant
tthis Agreement, any Certificate registered in the name of the Company or the
Master Servicer or any affiliate thereof shall be deemed not to be outstanding
and the Voting Rights to which such Certificate is entitled shall not be taken
into account in determining whether the requisite percentage of Voting Rights
necessary to effect any such consent has been obtained, except as otherwise
provided in Section 11.01. The Trustee shall be entitled to rely upon a
certification of the Company or the Master Servicer in determining if any
Certificates are registered in the name of the respective affiliate. All
references herein to "Holders" or "Certificateholders" shall reflect the rights
of Certificate Owners as they may indirectly exercise such rights through the
Depository and participating members thereof, except as otherwise specified
herein; provided, however, that the Trustee shall be required to recognize as a
"Holder" or "Certificateholder" only the Person in whose name a Certificate is
registered in the Certificate Register.

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

                  "Certificate Principal Balance": With respect to any Class of
Regular Certificates (other than the Class A-IO Certificates and Class C
Certificates) immediately prior to any Distribution Date, the Initial
Certificate Principal Balance thereof reduced by the sum of all amounts actually
distributed in respect of principal of such Class and, in the case of a
Mezzanine Certificate, Realized Losses allocated thereto on all prior
Distribution Dates. With respect to the Class C Certificates as of any date of
determination, an amount equal to the excess, if any, of (A) the then aggregate
Uncertificated Principal Balances of the REMIC 2 Regular Interests over (B) the
then aggregate Certificate Principal Balances of the Class A Certificates, the
Mezzanine Certificates and


                                        7

<PAGE>



the Class P Certificates then outstanding. The Class A-IO Certificates will not
have a Certificate Principal Balance.

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

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

                  "Class A Certificate": Any one of the Class A-1 Certificates,
Class A-2 Certificates or Class A-IO Certificates.

                  "Class A-1 Certificate": Any one of the Class A-1 Certificates
as designated on the face thereof substantially in the form annexed hereto as
Exhibit A, executed by the Trustee and authenticated and delivered by the
Trustee, representing the right to distributions as set forth herein and therein
and evidencing a Regular Interest in REMIC 3.

                  "Class A-1 Net WAC Rate": (A) For the May 2001 Distribution
Date through the October 2003 Distribution Date, a per annum rate equal to the
Net WAC Rate, and (B) for each Distribution Date thereafter, the weighted
average of the Net Mortgage Rates of the Group 1 Loans as of the first day of
the month preceding the month in which such Distribution Date occurs.

                  "Class A-2 Certificate": Any one of the Class A-2 Certificates
as designated on the face thereof substantially in the form annexed hereto as
Exhibit A, executed by the Trustee and authenticated and delivered by the
Trustee, representing the right to distributions as set forth herein and therein
and evidencing a Regular Interest in REMIC 3.

                  "Class A-2 Net WAC Rate": (A) For the May 2001 Distribution
Date through the October 2003 Distribution Date, a per annum rate equal to the
Net WAC Rate, and (B) for each Distribution Date thereafter, the weighted
average of the Net Mortgage Rates of the Group 2 Loans as of the first day of
the month preceding the month in which such Distribution Date occurs.

                  "Class A-IO Rate": With respect to the Class A-IO Certificates
and any of the first 30 Distribution Dates, a per annum rate equal to the excess
of (i) the Weighted Average Net Mortgage Rate over (ii) the excess (but not less
than zero) of (x) the Weighted Average Net Mortgage Rate over (y) 8.00% per
annum.

                  "Class A-IO Certificate": Any one of the Class A-IO
Certificates as designated on the face thereof substantially in the form annexed
hereto as Exhibit A, executed by the Trustee and authenticated and delivered by
the Trustee, representing the right to distributions as set forth herein and
therein and evidencing a Regular Interest in REMIC 3.

                  "Class A Principal Distribution Amount": For any applicable
Distribution Date, an amount equal to the excess (if any) of (x) the Certificate
Principal Balance of the Class A Certificates immediately prior to such
Distribution Date over (y) the difference between (a) the aggregate Stated


                                        8

<PAGE>



Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Prepayment
Period) and (b) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period, and after reduction for Realized Losses incurred
during the related Prepayment Period) multiplied by the sum of (A) approximately
14.00% and (B) the Current Specified Overcollateralization Percentage.

                  "Class B Certificate": Any one of the Class B Certificates as
designated on the face thereof substantially in the form annexed hereto as
Exhibit B-1, executed by the Trustee and authenticated and delivered by the
Trustee, representing the right to distributions as set forth herein and therein
and evidencing a Regular Interest in REMIC 3.

                  "Class B Principal Distribution Amount": For any applicable
Distribution Date, an amount equal to the excess (if any) of (x) the Certificate
Principal Balance of the Class B Certificates immediately prior to such
Distribution Date over (y) the difference between (a) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Prepayment
Period) and (b) the sum of (1) the Certificate Principal Balance of the Class A
Certificates (after taking into account the payment of the Class A Principal
Distribution Amount on such Distribution Date), (2) the Certificate Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (3) the
Certificate Principal Balance of the Class M-2 Certificates (after taking into
account the payment of the Class M-2 Principal Distribution Amount on such
Distribution Date), and (4) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period, and after reduction for Realized Losses
incurred during the related Prepayment Period) multiplied by the Current
Specified Overcollateralization Percentage.

                  "Class C Certificate": Any one of the Class C Certificates as
designated on the face thereof substantially in the form annexed hereto as
Exhibit B-3, executed by the Trustee and authenticated and delivered by the
Trustee, representing the right to distributions as set forth herein and therein
and evidencing a Regular Interest in REMIC 3.

                  "Class M-1 Certificate": Any one of the Class M-1 Certificates
as designated on the face thereof substantially in the form annexed hereto as
Exhibit B-1, executed by the Trustee and


                                        9

<PAGE>



authenticated and delivered by the Trustee, representing the right to
distributions as set forth herein and therein and evidencing a Regular Interest
in REMIC 3.

                  "Class M-1 Principal Distribution Amount": For any applicable
Distribution Date, an amount equal to the excess (if any) of (x) the Certificate
Principal Balance of the Class M-1 Certificates immediately prior to such
Distribution Date over (y) the difference between (a) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Prepayment
Period) and (b) the sum of (1) the Certificate Principal Balance of the Class A
Certificates (after taking into account the payment of the Class A Principal
Distribution Amount on such Distribution Date) and (2) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Prepayment
Period) multiplied by the sum of (A) approximately 8.50% and (B) the Current
Specified Overcollateralization Percentage.

                  "Class M-2 Certificate": Any one of the Class M-2 Certificates
as designated on the face thereof substantially in the form annexed hereto as
Exhibit B-1, executed by the Trustee and authenticated and delivered by the
Trustee, representing the right to distributions as set forth herein and therein
and evidencing a Regular Interest in REMIC 3.

                  "Class M-2 Principal Distribution Amount": For any applicable
Distribution Date, an amount equal to the excess (if any) of (x) the Certificate
Principal Balance of the Class M-2 Certificates immediately prior to such
Distribution Date over (y) the difference between (a) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the related Prepayment
Period), and (b) the sum of (1) the Certificate Principal Balance of the Class A
Certificates (after taking into account the payment of the Class A Principal
Distribution Amount on such Distribution Date), (2) the Certificate Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), and (3)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the related
Prepayment Period) multiplied by the sum of (A) approximately 4.00% and (B) the
Current Specified Overcollateralization Percentage.



                                       10

<PAGE>



                  "Class P Certificate": Any one of the Class P Certificates as
designated on the face thereof substantially in the form annexed hereto as
Exhibit B-2, executed by the Trustee and authenticated and delivered by the
Trustee, representing the right to distributions as set forth herein and therein
and evidencing a Regular Interest in REMIC 3.

                  "Class R Certificate": Any one of the Class R Certificates as
designated on the face thereof substantially in the form annexed hereto as
Exhibit B-4, executed by the Trustee and authenticated and delivered by the
Trustee, evidencing the ownership of the Class R-1 Interest, Class R-2 Interest
and the Class R-3 Interest.

                  "Class R-1 Interest": The uncertificated Residual Interest in
REMIC 1.

                  "Class R-2 Interest": The uncertificated Residual Interest in
REMIC 2.

                  "Class R-3 Interest": The uncertificated Residual Interest in
REMIC 3.

                  "Closing Date": April 30, 2001.

                  "Code": The Internal Revenue Code of 1986.

                  "Collateral Value": The appraised value of a Mortgaged
Property based upon the lesser of (i) the appraisal (as reviewed and approved by
the Seller) made at the time of the origination of the related Mortgage Loan, or
(ii) the sales price of such Mortgaged Property at such time of origination.
With respect to a Mortgage Loan the proceeds of which were used to refinance an
existing mortgage loan, the appraised value of the Mortgaged Property based upon
the appraisal (as reviewed and approved by the Seller) obtained at the time of
refinancing.

                  "Commission":  The Securities and Exchange Commission.

                  "Company": Impac Secured Assets Corp., or its successor in
interest.

                  "Compensating Interest": With respect to any Distribution
Date, an amount eto Prepayment Interest Shortfalls resulting from Principal
Prepayments during the related Prepayment Period, but not more than the sum of
the Master Servicing Fees and the Sub-Servicing Fees for the immediately
preceding Due Period.

                  "Corporate Trust Office": The principal corporate trust office
of the Trustee at which at any particular time its corporate trust business
related to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 1761 East St. Andrew Place, Santa Ana,
California 92705, Attention: Corporate Trust, Impac Secured Assets Corp. Series
2001-3 [IM01S3].



                                       11

<PAGE>



                  "Corresponding Certificate": With respect to (i) REMIC 2
Regular Interest L(ii) REMIC 2 Regular Interest H, (iii) REMIC 2 Regular
Interest LT2C and REMIC 2 Regular Interest 2T2I, (iv) REMIC 2 Regular Interest
LT2D and REMIC 2 Regular Interest LT2J, (v) REMIC 2 Regular Interest LT2E and
REMIC 2 Regular Interest LT2K and (vi) REMIC 2 Regular Interest LT2P, the (i)
Class A-1 Certificates, (ii) Class A-2 Certificates, (iii) Class M-1
Certificates, (iv) Class M-2 Certificates, (v) Class B Certificates and (vi)
Class P Certificates, respectively.

                  "Current Specified Overcollateralization Percentage": For any
Distribution Date, a percentage equal to (a) the Overcollateralization Target
Amount divided by (b) the aggregate Stated Principal Balance of the Mortgage
Loans as of the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period, to the extent
received or advanced, and unscheduled collections of principal received during
the related Prepayment Period, and after reduction for Realized Losses incurred
during the related Prepayment Period).

                  "Curtailment": Any Principal Prepayment made by a Mortgagor
which is not a Principal Prepayment in Full.

                  "Custodial Account": The custodial account or accounts created
and maintained pursuant to Section 3.10 in the name of a depository institution,
as custodian for the holders of the Certificates. Any such account or accounts
shall be an Eligible Account.

                  "Cut-off Date":  April 1, 2001.

                  "Defaulted Mortgage Loan" means any Mortgage Loan as to which
the Mortgagor has failed to make unexcused three or more consecutive scheduled
Monthly Payments.

                  "Deficient Valuation": With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged Property in an
amount less than the then outstanding indebtedness under the Mortgage Loan, or
any reduction in the amount of principal to be paid in connection with any
scheduled Monthly Payment that constitutes a permanent forgiveness of principal,
which valuation or reduction results from a proceeding under the Bankruptcy
Code.

                  "Definitive Certificate": Any definitive, fully registered
Certificate.

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

                  "Depository" The Depository Trust Company, or any successor
Depository hereafter named. The nominee of the initial Depository for purposes
of registering those Certificates that are to be Book-Entry Certificates is Cede
& Co. The Depository shall at all times be a "clearing corporation" as defined
in Section 8-102(5) of the Uniform Commercial Code of the State of New York and
a "clearing agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934, as amended.


                                       12

<PAGE>



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

                  "Determination Date": The 15th day (or if such 15th day is not
a Business Day, the Business Day immediately preceding such 15th day) of the
month of the related Distribution Date.

                  "Disqualified Organization": Any organization defined as a
"disqualified organization" under Section 860E(e)(5) of the Code, which includes
any of the following: (i) the United States, any State or political subdivision
thereof, any possession of the United States, or any agency or instrumentality
of any of the foregoing (other than an instrumentality which is a corporation if
all of its activities are subject to tax and, except for the Freddie Mac, a
majority of its board of directors is not selected by such governmental unit),
(ii) a foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter 1 of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381(a)(2)(C) of the
Code and (v) any other Person so designated by the Trustee based upon an Opinion
of Counsel that the holding of an Ownership Interest in a Class R Certificate by
such Person may cause any of REMIC 1, REMIC 2 or REMIC 3 or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class R
Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.

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

                  "Due Date": The first day of the month of the related
Distribution Date.

                  "Due Period": With respect to any Distribution Date, the
period commencing on the second day of the month preceding the month of such
Distribution Date (or, with respect to the first Due Period, the day following
the Cut-off Date) and ending on the related Due Date.

                  "Eligible Account": Any of (i) a segregated account maintained
with a federal or state chartered depository institution (A) the short-term
obligations of which are rated A-1+ or better by Standard & Poor's and P-1 by
Moody's (and F-1 by Fitch if rated by Fitch) at the time of any deposit therein
or (B) insured by the FDIC (to the limits established by such Corporation), the
uninsured deposits in which account are otherwise secured such that, as
evidenced by an Opinion of Counsel (obtained by the Person requesting that the
account be held pursuant to this clause (ii)) delivered to the Trustee prior to
the establishment of such account, the Certificateholders will have a claim with
respect to the funds in such account and a perfected first priority security
interest against


                                       13

<PAGE>



any collateral (which shall be limited to Permitted Investments, each of which
shall mature not later than the Business Day immediately preceding the
Distribution Date next following the date of investment in such collateral or
the Distribution Date if such Permitted Investment is an obligation of the
institution that maintains the Certificate Account or Custodial Account)
securing such funds that is superior to claims of any other depositors or
general creditors of the depository institution with which such account is
maintained, (ii) a segregated trust account or accounts maintained with a
federal or state chartered depository institution or trust company with trust
powers acting in its fiduciary capacity or (iii) a segregated account or
accounts of a depository institution acceptable to the Rating Agencies (as
evidenced in writing by the Rating Agencies that use of any such account as the
Custodial Account or the Certificate Account will not have an adverse effect on
the then- current ratings assigned to the Classes of the Certificates then rated
by the Rating Agencies). Eligible Accounts may bear interest.

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

                  "Excess Overcollateralized Amount": With respect to the Class
A Certificates (other than the Class A-IO Certificates) and the Mezzanine
Certificates and any Distribution Date, the excess, if any, of (i) the
Overcollateralized Amount for such Distribution Date, assuming that 100% of the
Principal Remittance Amount is applied as a principal payment on such
Distribution Date over (ii) the Overcollateralization Target Amount for such
Distribution Date.

                  "Excess Proceeds":  As defined in Section 3.22.

                  "Extra Principal Distribution Amount": With respect to any
Distribution Date, the lesser of (x) the Net Monthly Excess Cashflow for such
Distribution Date and (y) the Overcollateralization Deficiency Amount for such
Distribution Date.

                  "Fannie Mae": Federal National Mortgage Association or any
successor.

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

                  "Fitch": Fitch, Inc., or its successor in interest.

                  "Freddie Mac": Federal Home Loan Mortgage Corporation or any
successor.

                  "Funding Date": With respect to each Mortgage Loan, the date
on which funds were advanced by or on behalf of the Seller and interest began to
accrue thereunder.

                  "GMAC": GMAC Mortgage Corporation.

                  "Group 1 Loan": Any Mortgage Loan identified as a Group 1 Loan
on the Mortgage Loan Schedule.



                                       14

<PAGE>



                  "Group 2 Loan": Any Mortgage Loan identified as a Group 2 Loan
on the Mortgage Loan Schedule.

                  "Group 1 Marker Rate": With respect to the Class C
Certificates and any Distribution Date, a per annum rate equal to two (2) times
the weighted average of the Uncertificated R2 Pass-Through Rates for REMIC 2
Regular Interest LT2B, REMIC 2 Regular Interest LT2C, REMIC 2 Regular Interest
LT2D, REMIC 2 Regular Interest LT2E and REMIC 2 Regular Interest LT2F, with the
rate on REMIC 2 Regular Interest LT2B subject to a cap equal to (A) in the case
of any Distribution Date up to and including the Optional Termination Date, the
lesser of (x) 6.625% per annum and (y) the Group 1 Net WAC Rate and (B) in the
case of any Distribution Date after the Optional Termination Date, the lesser of
(x) 7.125% per annum and (y) the Group 1 Net WAC Rate for the purpose of this
calculation; with the rate on REMIC 2 Regular Interest LT2C subject to a cap
equal to (A) in the case of any Distribution Date up to and including the
Optional Termination Date, the lesser of (x) 7.030% per annum and (y) the
Mezzanine Net WAC Rate and (B) in the case of any Distribution Date after the
Optional Termination Date, the lesser of (x) 7.530% per annum and (y) the
Mezzanine Net WAC Rate for the purpose of this calculation; with the rate on
REMIC 2 Regular Interest LT2D subject to a cap equal to (A) in the case of any
Distribution Date up to and including the Optional Termination Date, the lesser
of (x) 7.250% per annum and (y) the Mezzanine Net WAC Rate and (B) in the case
of any Distribution Date after the Optional Termination Date, the lesser of (x)
7.750% per annum and (y) the Mezzanine Net WAC Rate for the purpose of this
calculation; with the rate on REMIC 2 Regular Interest LT2E subject to a cap
equal to (A) in the case of any Distribution Date up to and including the
Optional Termination Date, the lesser of (x) 7.250% per annum and (y) the
Mezzanine Net WAC Rate and (B) in the case of any Distribution Date after the
Optional Termination Date, the lesser of (x) 7.750% per annum and (y) the
Mezzanine Net WAC Rate for the purpose of this calculation; and with the rate on
REMIC 2 Regular Interest LT2F subject to a cap of zero for the purpose of this
calculation.

         "Group 1 Net WAC Rate": With respect to each Distribution Date through
and including the Distribution Date in October 2003, the Net WAC Rate and for
each Distribution Date thereafter, the weighted average of the Net Mortgage
Rates of the Group 1 Mortgage Loans, weighted on the basis of the Stated
Principal Balances thereof as of the close of business on the first day of the
calendar month preceding the month in which such Distribution Date occurs.

         "Group 2 Marker Rate": With respect to the Class C Certificates and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the Uncertificated REMIC 2 Pass-Through Rates for REMIC 2 Regular Interest
LT2H, REMIC 2 Regular Interest LT2I, REMIC 2 Regular Interest LT2J, REMIC 2
Regular Interest LT2K and REMIC 2 Regular Interest LT2L; with the rate on REMIC
2 Regular Interest LT2H subject to a cap equal to (A) in the case of any
Distribution Date up to and including the Optional Termination Date, the lesser
of (x) 7.250% per annum and (y) the Group 2 Net WAC Rate and (B) in the case of
any Distribution Date after the Optional Termination Date, the lesser of (x)
7.750% per annum and (y) the Group 2 Net WAC Rate for the purpose of this
calculation; with the rate on REMIC 2 Regular Interest LT2I subject to a cap
equal to (A) in the case of any Distribution Date up to and including the
Optional Termination Date,


                                       15

<PAGE>



the lesser of (x) 7.030% per annum and (y) the Mezzanine Net WAC Rate and (B) in
the case of any Distribution Date after the Optional Termination Date, the
lesser of (x) 7.530% per annum and (y) the Mezzanine Net WAC Rate for the
purpose of this calculation; with the rate on REMIC 2 Regular Interest LT2J
subject to a cap equal to (A) in the case of any Distribution Date up to and
including the Optional Termination Date, the lesser of (x) 7.250% per annum and
(y) the Mezzanine Net WAC Rate and (B) in the case of any Distribution Date
after the Optional Termination Date, the lesser of (x) 7.750% per annum and (y)
the Mezzanine Net WAC Rate for the purpose of this calculation; with the rate on
REMIC 2 Regular Interest LT2K subject to a cap equal to (A) in the case of any
Distribution Date up to and including the Optional Termination Date, the lesser
of (x) 7.250% per annum and (y) the Mezzanine Net WAC Rate and (B) in the case
of any Distribution Date after the Optional Termination Date, the lesser of (x)
7.750% per annum and (y) the Mezzanine Net WAC Rate for the purpose of this
calculation; and with the rate on REMIC 2 Regular Interest LT2L subject to a cap
of zero for the purpose of this calculation.

                  "Group 2 Net WAC Rate": With respect to each Distribution Date
through and including the Distribution Date in October 2003, the Net WAC Rate
and for each Distribution Date thereafter, the weighted average of the Net
Mortgage Rates of the Group 2 Mortgage Loans, weighted on the basis of the
Stated Principal Balances thereof as of the close of business on the first day
of the calendar month preceding the month in which such Distribution Date
occurs.

                  "Initial Certificate Principal Balance": With respect to each
Class of Regular Certificates (other than the Class A-IO Certificates), the
Initial Certificate Principal Balance of such Class of Certificates as set forth
in the Preliminary Statement hereto, or with respect to any single Certificate,
the Initial Certificate Principal Balance as stated on the face thereof.

                  "Initial Notional Amount": With respect to the Class A-IO
Certificates, $20,000,000.00 or with respect to any single Certificate, the
Initial Notional Amount as stated othe face thereof. With respect to the Class C
Certificate, the aggregate of the initial Uncertificated Principal Balance of
the REMIC 2 Regular Interests, or with respect to any single Certificate, the
Initial Notional Amount as stated on the face thereof.

                  "Insurance Policy": With respect to any Mortgage Loan, any
insurance policy (including a Radian Lender-Paid PMI Policy) which is required
to be maintained from time to time under this Agreement in respect of such
Mortgage Loan.

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



                                       16

<PAGE>



                  "Interest Remittance Amount": With respect to any Distribution
Date, that portion of the Available Distribution Amount for such Distribution
Date allocable to interest received or advanced on the Mortgage Loans.

                  "Late Collections": With respect to any Mortgage Loan, all
amounts received during any Due Period, whether as late payments of Monthly
Payments or as Insurance Proceeds, Liquidation Proceeds or otherwise, which
represent late payments or collections of Monthly Payments due but delinquent
for a previous Due Period and not previously recovered.

                  "Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the Master Servicer has determined, in
accordance with the servicing procedures specified herein, as of the end of the
related Prepayment Period, that all Liquidation Proceeds which it expects to
recover with respect to the liquidation of the Mortgage Loan or disposition of
the related REO Property have been recovered.

                  "Liquidation Proceeds": Amounts (other than Insurance
Proceeds) received by the Master Servicer in connection with the taking of an
entire Mortgaged Property by exercise of the power of eminent domain or
condemnation or in connection with the liquidation of a defaulted Mortgage Loan
through trustee's sale, foreclosure sale or otherwise, other than amounts rin
respect of any REO Property.

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

                  "Lost Note Affidavit": With respect to any Mortgage Note, an
original lost note affidavit from the Seller stating that the original Mortgage
Note was lost, misplaced or destroyed, together with a copy of the related
Mortgage Note.

                  "Majority Class C Certificateholder": As defined in Section
9.01.

                  "Master Servicer": Impac Funding Corporation, or any successor
master servicer appointed as herein provided.

                  "Master Servicer Prepayment Charge Payment Amount": The
amounts payable by the Master Servicer in respect of any waived Prepayment
Charges pursuant to Section 2.03, and any amount paid to the Trust Fund by any
Person to remedy any breach of any representation, warranty of covenant made
with respect to the Prepayment Charges to the extent the Trust Fund, as
assignee, is the beneficiary of such representation, warranty or covenant.

                  "Master Servicing Fees": As to each Mortgage Loan, an amount,
payable out of any payment of interest on the Mortgage Loan, equal to interest
at the Master Servicing Fee Rate on the


                                       17

<PAGE>



Stated Principal Balance of such Mortgage Loan for the calendar month preceding
the month in which the payment is due (alternatively, in the event such payment
of interest accompanies a Principal Prepayment in Full made by the Mortgagor,
interest for the number of days covered by such payment of interest).

                  "Master Servicing Fee Rate": With respect to each Mortgage
Loan, the per annum rate of 0.03%.

                  "Maximum Uncertificated Accrued Interest Deferral Amount":
With respect to any Distribution Date, the excess of (a) the sum of (I) accrued
interest at the Uncertificated REMIC 2 Pass-Through Rate applicable to REMIC 2
Regular Interest LT2F for such Distribution Date on a balance equal to the
excess of (i) the Uncertificated Principal Balance of REMIC 2 Regular Interest
LT2F and (ii) the REMIC 2 Group 1 Overcollateralized Amount for such
Distribution Date and (II) accrued interest at the Uncertificated REMIC 2
Pass-Through Rate applicable to REMIC 2 Regular Interest LT2L for such
Distribution Date on a balance equal to the excess of (i) the Uncertificated
Principal Balance of REMIC 2 Regular Interest LT2L and (ii) the REMIC 2 Group 2
Overcollateralized Amount for such Distribution Date, over (b) Uncertificated
Accrued Interest on REMIC 2 Regular Interest LT2B, with the rate on REMIC 2
Regular Interest LT2B subject to a cap equal to (A) in the case of any
Distribution Date up to and including the Optional Termination Date, the lesser
of (x) 6.625% per annum and (y) the Group 1 Net WAC Rate and (B) in the case of
any Distribution Date after the Optional Termination Date, the lesser of (x)
7.125% per annum and (y) the Group 1 Net WAC Rate for the purpose of this
calculation, Uncertificated Accrued Interest on REMIC 2 Regular Interest LT2C,
with the rate on REMIC 2 Regular Interest LT2C subject to a cap equal to (A) in
the case of any Distribution Date up to and including the Optional Termination
Date, the lesser of (x) 7.030% per annum and (y) the Mezzanine Net WAC Rate and
(B) in the case of any Distribution Date after the Optional Termination Date,
the lesser of (x) 7.530% per annum and (y) the Mezzanine Net WAC Rate for the
purpose of this calculation, Uncertificated Accrued Interest on REMIC 2 Regular
Interest LT2D, with the rate on REMIC 2 Regular Interest LT2D subject ta cap
equal to (A) in the case of any Distribution Date up to and including the
Optional Termination Date, the lesser of (x) 7.250% per annum and (y) the
Mezzanine Net WAC Rate and (B) in the case of any Distribution Date after the
Optional Termination Date, the lesser of (x) 7.750% per annum and (y) the
Mezzanine Net WAC Rate for the purpose of this calculation, and Uncertificated
Accrued Interest on REMIC 2 Regular Interest LT2E, with the rate on REMIC 2
Regular Interest LT2E subject to a cap equal to (A) in the case of any
Distribution Date up to and including the Optional Termination Date, the lesser
of (x) 7.250% per annum and (y) the Mezzanine Net WAC Rate and (B) in the case
of any Distribution Date after the Optional Termination Date, the lesser of (x)
7.750% per annum and (y) the Mezzanine Net WAC Rate for the purpose of this
calculation, Uncertificated Accrued Interest on REMIC 2 Regular Interest LT2H,
with the rate on REMIC 2 Regular Interest LT2H subject to a cap equal to (A) in
the case of any Distribution Date up to and including the Optional Termination
Date, the lesser of (x) 7.250% per annum and (y) the Group 2 Net WAC Rate and
(B) in the case of any Distribution Date after the Optional Termination Date,
the lesser of (x) 7.750% per annum and (y) the Group 2 Net WAC Rate for the
purpose of this calculation, Uncertificated Accrued Interest on REMIC 2 Regular
Interest LT2I, with the rate on REMIC 2


                                       18

<PAGE>



Regular Interest LT2I subject to a cap equal to (A) in the case of any
Distribution Date up to and including the Optional Termination Date, the lesser
of (x) 7.030% per annum and (y) the Mezzanine Net WAC Rate and (B) in the case
of any Distribution Date after the Optional Termination Dthe lesser of (x)
7.530% per annum and (y) the Mezzanine Net WAC Rate for the purpose of this
calculation, Uncertificated Accrued Interest on REMIC 2 Regular Interest LT2J,
with the rate on REMIC 2 Regular Interest LT2J subject to a cap equal to (A) in
the case of any Distribution Date up to and including the Optional Termination
Date, the lesser of (x) 7.250% per annum and (y) the Mezzanine Net WAC Rate and
(B) in the case of any Distribution Date after the Optional Termination Date,
the lesser of (x) 7.750% per annum and (y) the Mezzanine Net WAC Rate for the
purpose of this calculation, and Uncertificated Accrued Interest on REMIC 2
Regular Interest LT2K, with the rate on REMIC 2 Regular Interest LT2K subject to
a cap equal to (A) in the case of any Distribution Date up to and including the
Optional Termination Date, the lesser of (x) 7.250% per annum and (y) the
Mezzanine Net WAC Rate and (B) in the case of any Distribution Date after the
Optional Termination Date, the lesser of (x) 7.750% per annum and (y) the
Mezzanine Net WAC Rate for the purpose of this calculation.

                  "Mezzanine Certificate": Any Class M-1 Certificate, Class M-2
Certificate or Class B Certificate.

                  "Mezzanine Net WAC Rate": (A) For the May 2001 Distribution
Date through the October 2003 Distribution Date, a per annum rate equal to the
Net WAC Rate and (B) for each Distribution Date thereafter, the lesser of (1)
the weighted average of the Net Mortgage Rates of the Group 1 Loans as of the
first day of the month preceding the month in which such Distribution Date
occurs and (2) the weighted average of the Net Mortgage Rates of the Group 2
Loans as of the first day of the month preceding the month in which such
Distribution Date occurs.

                  "Monthly Interest Distributable Amount": With respect to the
Class A Certificates, Mezzanine Certificates and Class C Certificates and any
Distribution Date, the amount of interest accrued during the related Accrual
Period at the related Pass-Through Rate on the Certificate Principal Balance (or
Notional Amount in the case of the Class A-IO Certificates and Class C
Certificates) of such Class immediately prior to such Distribution Date, in each
case, reduced by any Net Prepayment Interest Shortfalls and Relief Act Interest
Shortfalls (allocated to such Certificate as set forth in Section 1.02).

                  "Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by a Mortgagor from time to time under the related Mortgage Note as
originally executed (after adjustment, if any, for Deficient Valuations
occurring prior to such Due Date, and after any adjustment by reason of any
bankruptcy or similar proceeding or any moratorium or similar waiver or grace
period).

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

                  "Mortgage": The mortgage, deed of trust or any other
instrument securing the Mortgage Loan.


                                       19

<PAGE>



                  "Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement; provided, that
whenever the term "Mortgage File" is used to refer to documents actually
received by the Trustee, such term shall not be deemed to include such
additional documents required to be added unless they are actually so added.

                  "Mortgage Loan": Each of the mortgage loans, transferred and
assigned to the Trustee pursuant to Section 2.01 or Section 2.04 and from time
to time held in the Trust Fund (including any Qualified Substitute Mortgage
Loans), the Mortgage Loans so transferred, assigned and held being identified in
the Mortgage Loan Schedule. As used herein, the term "Mortgage Loan" includes
the related Mortgage Note and Mortgage.

                  "Mortgage Loan Purchase Agreement": The Mortgage Loan Purchase
Agreement dated as of April 1, 2001, among Impac Funding Corporation, as seller,
Impac Mortgage Holdings, Inc., as guarantor, and the Company as purchaser, and
all amendments thereof and supplements thereto.

                  "Mortgage Loan Schedule": As of any date of determination, the
schedule of Mortgage Loans included in the Trust Fund. The initial schedule of
Mortgage Loans with accompanying information transferred on the Closing Date to
the Trustee as part of the Trust Fund for the Certificates, attached hereto as
Exhibit H (as amended from time to time to reflect the addition of Qualified
Substitute Mortgage Loans) (and, for purposes of the Trustee pursuant to Section
2.02, in computer-readable form as delivered to the Trustee), which list shall
set forth the following information with respect to each Mortgage Loan:

                (i)        the loan number and name of the Mortgagor;

               (ii)        the street address, city, state and zip code of the
                           Mortgaged Property;

              (iii)        (A) the original term to maturity and (B) if such
                           Mortgage Loan is a Balloon Loan, the amortization
                           term thereof;

               (iv)        the original principal balance and the original
                           Mortgage Rate;

                (v)        the first payment date;

               (vi)        whether the Mortgage Loan is a Balloon Mortgage Loan
                           or a Mortgage Loan the terms of which do not provide
                           for a Balloon Payment;

              (vii)        the type of Mortgaged Property;

             (viii)        the Monthly Payment in effect as of the Cut-off Date;

               (ix)        the principal balance as of the Cut-off Date;


                                                        20

<PAGE>



                (x)        the Mortgage Rate as of the Cut-off Date;

               (xi)        the occupancy status;

              (xii)        the purpose of the Mortgage Loan;

             (xiii)        the Collateral Value of the Mortgaged Property;

              (xiv)        the original term to maturity;

               (xv)        the paid-through date of the Mortgage Loan;

              (xvi)        the Master Servicing Fee Rate;

             (xvii)        the Sub-Servicing Fee Rate;

            (xviii)        the Net Mortgage Rate for such Mortgage Loan;

              (xix)        whether such Mortgage Loan is a Radian Insured Loan
                           and, if so, the related Radian PMI Policy Rate;

               (xx)        whether the Mortgage Loan is covered by a private
                           mortgage insurance policy or an original certificate
                           of private mortgage insurance;

              (xxi)        the documentation type;

             (xxii)        the type and term of the related Prepayment Charge,
                           if any; and

            (xxiii)        whether the Mortgage Loan is a Group 1 Loan or a
                           Group 2 Loan.

                  The Mortgage Loan Schedule may be in the form of more than one
schedule, collectively setting forth all of the information required.

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

                  "Mortgage Rate": With respect to any Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan, as adjusted from time to
time in accordance with the provisions of the Mortgage Note.

                  "Mortgaged Property": The underlying property securing a
Mortgage Loan.

                  "Mortgagor":  The obligor or obligors on a Mortgage Note.



                                       21

<PAGE>



                  "Net Liquidation Proceeds": With respect to any Liquidated
Mortgage Loan or any other disposition of related Mortgaged Property (including
REO Property) the related Liquidation Proceeds net of Advances, Servicing
Advances, Master Servicing Fees, Sub-Servicing Fees and any other accrued and
unpaid servicing fees received and retained in connection with the liquidation
of such Mortgage Loan or Mortgaged Property.

                  "Net Monthly Excess Cashflow": With respect to each
Distribution Date, the sum of (a) any Overcollateralization Release Amount for
such Distribution Date and (b) the excess of (x) Available Distribution Amount
for such Distribution Date over (y) the sum for such Distribution Date of (A)
the Monthly Interest Distributable Amounts for the Class A Certificates and the
Mezzanine Certificates, (B) the Unpaid Interest Shortfall Amounts for the Class
A Certificates and (C) the Principal Remittance Amount.

                  "Net Mortgage Rate": With respect to each Mortgage Loan Due
Date, a per annum rate of interest equal to the then-applicable Mortgage Rate on
such Mortgage Loan less the sum of the Master Servicing Fee Rate, the
Sub-Servicing Fee Rate, the Trustee Fee Rate, and with respect to the Radian
Insured Loans, the Radian PMI Policy Rate.

                  "Net Prepayment Interest Shortfall": With respect to any
Distribution Date, the excess, if any, of any Prepayment Interest Shortfalls for
such date over the related Compensating Interest.

                  "Net WAC Rate": With respect to each class of the Class A
Certificates (other than the Class A-IO Certificates), each Class of the
Mezzanine Certificates and the REMIC 2 Regular Interests (other than REMIC 2
Regular Interest LTA-IO) and any Distribution Date, a per arate (but not less
than zero) equal to the weighted average of (x) the Uncertificated REMIC 1 Pass-
Through Rate with respect to REMIC 1 Regular Interest LT1A, REMIC 1 Regular
Interest LT1B, REMIC 1 Regular Interest LT1C and REMIC 1 Regular Interest LT1P
for such Distribution Date and (y) the excess, if any, of (i) the Uncertificated
REMIC 1 Pass-Through Rate with respect to REMIC 1 Regular Interest LT1D for such
Distribution Date over (ii) (A) in the case of the Distribution Dates beginning
in May 2001 and ending in October 2003, the Class A-IO Rate, and (B) in the case
of any Distribution Date thereafter, 0.00% per annum, weighted, in the case of
clause (x), on the basis of the aggregate Uncertificated Principal Balance of
REMIC 1 Regular Interest LT1A, REMIC 1 Regular Interest LT1B, REMIC 1 Regular
Interest LT1C and REMIC 1 Regular Interest LT1P, and in the case of clause (y),
on the basis of the Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1D, respectively.

                  "Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan which, in
the good faith judgment of the Master Servicer, will not or, in the case of a
proposed Advance or Servicing Advance, would not be ultimately recoverable from
related Late Collections, Insurance Proceeds, Liquidation Proceeds or REO
Proceeds. The determination by the Master Servicer that it has made a
Nonrecoverable Advance or that any proposed Advance or Servicing Advance would
constitute a Nonrecoverable


                                       22

<PAGE>



Advance, shall be evidenced by a certificate of a Servicing Officer delivered to
the Company and the Trustee.

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

                  "Notional Amount": With respect to the Class A-IO
Certificates, immediately prior to any Distribution Date, an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1D. With respect
to the Class C Certificates, immediately prior to any Distribution Date, the
aggregate of the Uncertificated Principal Balances of the REMIC 2 Regular
Interests.

                  "Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the Board, the President or a vice president
and by the Treasurer, the Secretary, or one of the assistant treasurers or
assistant secretaries of the Company, the Seller, the Master Servicer or of any
Sub-Servicer and delivered to the Company and Trustee.

                  "Opinion of Counsel": A written opinion of counsel, who may be
counsel for the Company, the Seller, or the Master Servicer, reasonably
acceptable to the Trustee; except that any opinion of counsel relating to (a)
the qualification of any account required to be maintained pursuant to this
Agreement as an Eligible Account, (b) the qualification of REMIC 1, REMIC 2 or
REMIC 3 as REMICs, (c) compliance with the REMIC Provisions or (d) resignation
of the Master Servicer pursuant to Section 6.04 must be an opinion of counsel
who (i) is in fact independent of the Company and the Master Servicer, (ii) does
not have any direct financial interest or any material indirect financial
interest in the Company or the Master Servicer or in an affiliate of either and
(iii) is not connected with the Company or the Master Servicer as an officer,
employee, director or person performing similar functions.

                  "Optional Termination Date": The first Distribution Date on
which the Majority Class C Certificateholders may opt to terminate the Trust
Fund pursuant to Section 9.01.

                  "OTS":  Office of Thrift Supervision or any successor.

                  "Outstanding Mortgage Loan": As to any Due Date, a Mortgage
Loan (including an REO Property) which was not the subject of a Principal
Prepayment in Full, Cash Liquidation or REO Disposition and which was not
purchased prior to such Due Date pursuant to Sections 2.02, 2.04 or 3.14.

                  "Overcollateralization Deficiency Amount": With respect to any
Distribution Date, the amount, if any, by which the Overcollateralization Target
Amount exceeds the Overcollateralized Amount on such Distribution Date (after
giving effect to distributions in respect of the Basic Principal Distribution
Amount on such Distribution Date).



                                       23

<PAGE>



                  "Overcollateralization Release Amount": With respect to any
Distribution Date, the lesser of (x) the Principal Remittance Amount for such
Distribution Date and (y) the Excess Overcollateralized Amount.

                  "Overcollateralization Target Amount": With respect to any
Distribution Date, $1,000,000.

                  "Overcollateralized Amount": With respect to any Distribution
Date, the amount, if any, by which (i) the aggregate Stated Principal Balance of
the Mortgage Loans (after giving effect to scheduled payments of principal due
during the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related Prepayment
Period and after reduction for Realized Losses incurred during the related
Prepayment Period) exceeds (ii) the aggregate Certificate Principal Balance of
the Class A Certificates (other than the Class A-IO Certificates), the Mezzanine
Certificates and the Class P Certificates as of such Distribution Date after
giving effect to distributions to be made on such Distribution Date.

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

                  "Pass-Through Rate": With respect to any Distribution Date and

         (i)      the Class A-1 Certificates, (A) in the case of any
                  Distribution Date up to and including the Optional Termination
                  Date, the lesser of (x) 6.625% per annum and (y) the Class A-1
                  Net WAC Rate and (B) in the case of any Distribution Date
                  after the Optional Termination Date, the lesser of (x) 7.125%
                  per annum and (y) the Class A-1 Net WAC Rate;

         (ii)     the Class A-2 Certificates, (A) in the case of any
                  Distribution Date up to and including the Optional Termination
                  Date, the lesser of (x) 7.250% per annum and (y) the Class A-2
                  Net WAC Rate and (B) in the case of any Distribution Date
                  after the Optional Termination Date, the lesser of (x) 7.750%
                  per annum and (y) the Class A-2 Net WAC Rate;

         (iii)    the Class A-IO Certificates, 100% of the interest on REMIC 2
                  Regular Interest LT2A-IO;

         (iv)     the Class M-1 Certificates, (A) in the case of any
                  Distribution Date up to and including the Optional Termination
                  Date, the lesser of (x) 7.030% per annum and (y) the Net WAC
                  Rate and (B) in the case of any Distribution Date after the
                  Optional Termination Date, the lesser of (x) 7.530% per annum
                  and (y) the Mezzanine Net WAC Rate;



                                       24

<PAGE>



         (v)      the Class M-2 Certificates, (A) in the case of any
                  Distribution Date up to and including the Optional Termination
                  Date, the lesser of (x) 7.250% per annum and (y) the Mezzanine
                  Net WAC Rate and (B) in the case of any Distribution Date
                  after the Optional Termination Date, the lesser of (x) 7.750%
                  per annum and (y) the Mezzanine Net WAC Rate;

         (vi)     the Class B Certificates, (A) in the case of any Distribution
                  Date up to and including the Optional Termination Date, the
                  lesser of (x) 7.250% per annum and (y) the Mezzanine Net WAC
                  Rate and (B) in the case of any Distribution Date after the
                  Optional Termination Date, the lesser of (x) 7.750% per annum
                  and (y) the Mezzanine Net WAC Rate; and

         (vii)    the Class C Certificates, a per annum rate equal to the
                  percentage equivalent of a fraction, the numerator of which is
                  (x) the sum of the amounts calculated pursuant to clauses (A)
                  through (M) below, and the denominator of which is (y) the
                  aggregate of the Uncertificated Principal Balances of REMIC 2
                  Regular Interest REMIC 2 Regular Interest LT2A, REMIC 2
                  Regular Interest LT2B, REMIC 2 Regular Interest LT2C, REMIC 2
                  Regular Interest LT2D, REMIC 2 Regular Interest LT2E, REMIC 2
                  Regular Interest LT2F, REMIC 2 Regular Interest LT2G, REMIC 2
                  Regular Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC 2
                  Regular Interest LT2J, REMIC 2 Regular Interest LT2K, REMIC 2
                  Regular Interest LT2L and REMIC 2 Regular Interest LT2P. For
                  purposes of calculating the Pass-Through Rate for the Class C
                  Certificates, the numerator is equal to the sum of the
                  following components:

                  (A) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2A minus the Group 1 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2A;

                  (B) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2B minus the Group 1 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2B;

                  (C) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2C minus the Group 1 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2C;

                  (D) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2D minus the Group 1 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2D;

                  (E) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2E minus the Group 1 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2E;



                                       25

<PAGE>



                  (F) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2F minus the Group 1 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2F;

                  (G) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2G minus the Group 2 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2G;

                  (H) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2H minus the Group 2 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2H;

                  (I) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2I minus the Group 2 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2I;

                  (J) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2J minus the Group 2 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2J;

                  (K) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2K minus the Group 2 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2K;

                  (L) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2L minus the Group 2 Marker Rate, applied to an amount equal
to the Uncertificated Principal Balance of REMIC 2 Regular Interest LT2L; and

                  (M) 100% of the interest on REMIC 2 Regular Interest LT2P.

                  The Class P Certificates will not accrue interest and
therefore will not have a P Through Rate.

                  "Percentage Interest": With respect to any Regular
Certificate, the undivided percentage ownership interest in the related Class
evidenced by such Certificate, which percentage ownership interest shall be
equal to the Initial Certificate Principal Balance thereof or Initial Notional
Amount, as applicable, thereof divided by the aggregate Initial Certificate
Principal Balance or Initial Notional Amount, as applicable, of all of the
Certificates of the same Class. With respect to any Class R Certificate, the
interest in distributions to be made with respect to such Class evidenced
thereby, expressed as a percentage, as stated on the face of each such
Certificate.

                  "Permitted Investment": One or more of the following:



                                       26

<PAGE>



                  (i) obligations of or guaranteed as to principal and interest
         by the United States or any agency or instrumentality thereof when such
         obligations are backed by the full faith and credit of the United
         States;

                  (ii) repurchase agreements on obligations specified in clause
         (i) maturing not more than one month from the date of acquisition
         thereof, provided that the unsecured obligations of the party agreeing
         to repurchase such obligations are at the time rated by each Rating
         Agency in its highest short-term rating available;

                  (iii) federal funds, certificates of deposit, demand deposits,
         time deposits and bankers' acceptances (which shall each have an
         original maturity of not more than 90 days and, in the case of bankers'
         acceptances, shall in no event have an original maturity of more than
         365 days or a remaining maturity of more than 30 days) denominated in
         United States dollars of any U.S. depository institution or trust
         company incorporated under the laws othe United States or any state
         thereof or of any domestic branch of a foreign depository institution
         or trust company; provided that the debt obligations of such depository
         institution or trust company (or, if the only Rating Agency is Standard
         & Poor's, in the case of the principal depository institution in a
         depository institution holding company, debt obligations of the
         depository institution holding company) at the date of acquisition
         thereof have been rated by each Rating Agency in its highest short-term
         rating available; and provided further that, if the only Rating Agency
         is Standard & Poor's and if the depository or trust company is a
         principal subsidiary of a bank holding company and the debt obligations
         of such subsidiary are not separately rated, the applicable rating
         shall be that of the bank holding company; and, provided further that,
         if the original maturity of such short-term obligations of a domestic
         branch of a foreign depository institution or trust company shall
         exceed 30 days, the short-term rating of such institution shall be A-1+
         in the case of Standard & Poor's if Standard & Poor's is the Rating
         Agency;

                  (iv) commercial paper (having original maturities of not more
         than 365 days) of any corporation incorporated under the laws of the
         United States or any state thereof which on the date of acquisition has
         been rated by Moody's and Standard & Poor's (and by Fitch if rated by
         Fitch) in their highest short-term ratings available; provided that
         such commercial paper shall have a remaining maturity of not more than
         30 days;

                  (v) a money market fund or a qualified investment fund rated
         by Moody's and Fitch in their respective highest long-term ratings
         available and rated AAAm or A by Standard & Poor's, including any such
         funds for which Bankers Trust Company of California, N.A. or any
         affiliate thereof serves as an investment advisor, manager,
         administrator, shareholder, servicing agent, and/or custodian or
         sub-custodian; and

                  (vi) other obligations or debt securities that are acceptable
         to each Rating Agency as a Permitted Investment hereunder and will not
         reduce the rating assigned to any Class of Certificates by such Rating
         Agency below the lower of the then-current rating or the rating


                                       27

<PAGE>



         assigned to such Certificates as of the Closing Date by such Rating
         Agency, as ein writing;

provided, however, that no instrument shall be a Permitted Investment if it
represents, either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest payments derived from obligations underlying such instrument and the
principal and interest payments with respect to such instrument provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations.

                  "Permitted Transferee": Any transferee of a Residual
Certificate other than a Disqualified Organization, a Non-United States Person
or an "electing large partnership" (as defined in Section 775 of the Code).

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

                  "Prepayment Assumption": As defined in the Prospectus
Supplement.

                  "Prepayment Charge": With respect to any Mortgage Loan, the
charges or premiums, if any, due in connection with a full or partial prepayment
of such Mortgage Loan in accordance with the terms thereof (other than any
Master Servicer Prepayment Charge Payment Amount).

                  "Prepayment Interest Shortfall": As to any Distribution Date
and any Mortgage Loan (other than a Mortgage Loan relating to an REO Property)
that was the subject of (a) a Principal Prepayment in Full during the related
Prepayment Period, an amount equal to the excess of one month's interest at the
Net Mortgage Rate on the Stated Principal Balance of such Mortgage Loan over the
amount of interest (adjusted to the Net Mortgage Rate) paid by the Mortgagor for
such Prepayment Period to, but not including, the date of such Principal
Prepayment in Full or (b) a Curtailment during the prior calendar month, an
amount equal to one month's interest at the Net Mortgage Rate on the amount of
such Curtailment.

                  "Prepayment Period": As to any Distribution Date,
Determination Date or Sub- Servicer Remittance Date, the calendar month
preceding the month in which such Distribution Date, Determination Date or
Sub-Servicer Remittance Date occurs.

                  "Primary Hazard Insurance Policy": Each primary hazard
insurance policy required to be maintained pursuant to Section 3.13.

                  "Primary Insurance Policy": Any primary policy of mortgage
guaranty insurance including the Radian Lender-Paid PMI Policy, or any
replacement policy therefor.



                                       28

<PAGE>



                  "Principal Distribution Amount": With respect to any
Distribution Date, an amount equal to the sum of the Basic Principal
Distribution Amount plus the Extra Principal Distribution Amount.

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

                  "Principal Prepayment in Full": Any Principal Prepayment made
by a Mortgagor of the entire unpaid principal balance of the Mortgage Loan.

                  "Principal Remittance Amount": With respect to any
Distribution Date, the sum of (i) each scheduled payment of principal collected
or advanced on the Mortgage Loans by the Master Servicer that were due during
the related Due Period, (ii) the principal portion of all partial and full
Principal Prepayments of the Mortgage Loans applied by the Master Servicer
during the related Prepayment Period, (iii) the principal portion of all related
Net Liquidation Proceeds, REO Proceeds and Insurance Proceeds received during
the related Prepayment Period, (iv) the principal portion of proceeds of
Mortgage Loan purchases made pursuant to Section 2.02, 2.04, 3.14 or 3.22, in
each case received or made during the related Prepayment Period, (v) the
principal portion of any related Substitution Adjustments deposited in the
Custodial Account during the related Prepayment Period and (vi) on the
Distribution Date on which the Trust Fund is to be terminated pursuant to
Section 9.01, the principal portion of the termination price received from the
Majority Class C Certificateholders in connection with a termination of the
Trust Fund to occur on such Distribution Date.

                  "Prospectus Supplement": That certain Prospectus Supplement
dated April 23, 2001 relating to the public offering of the Class A Certificates
and the Mezzanine Certificates.

                  "Purchase Price": With respect to any Mortgage Loan (or REO
Property) required to be purchased pursuant to Section 2.02, 2.04 or 3.14, an
amount equal to the sum of (i) 100% of the Stated Principal Balance thereof,
(ii) unpaid accrued interest (or REO Imputed Interest) at the applicable Net
Mortgage Rate on the Stated Principal Balance thereof outstanding during each
Due Period that such interest was not paid or advanced, from the date through
which interest was last paid by the Mortgagor or advanced and distributed to
Certificateholders together with unpaid Master Servicing Fees, Sub-Servicing
Fees, Trustee's Fees and, if such Mortgage Loan is a Radian Insured Loan, fees
due Radian at the Radian PMI Policy Rate, from the date through which interest
was last paid by the Mortgagor, in each case to the first day of the month in
which such Purchase Price is to be distributed, plus (iii) the aggregate of all
Advances and Servicing Advances made in respect thereof that were not previously
reimbursed.

                  "Qualified Insurer": Any insurance company duly qualified as
such under the laws of the state or states in which the related Mortgaged
Property or Mortgaged Properties is or are located, duly authorized and licensed
in such state or states to transact the type of insurance business


                                       29

<PAGE>



in which it is engaged and approved as an insurer by the Master Servicer, so
long as the claims paying ability of which is acceptable to the Rating Agencies
for pass-through certificates having the same rating as the Certificates rated
by the Rating Agencies as of the Closing Date.

                  "Qualified Substitute Mortgage Loan": A Mortgage Loan
substituted by the Company for a Deleted Mortgage Loan which must, on the date
of such substitution, as confirmed in an Officers' Certificate of the Seller
delivered to the Trustee, (i) have an outstanding principal balance, after
deduction of the principal portion of the monthly payment due in the month of
substitution (or in the case of a substitution of more than one Mortgage Loan
for a Deleted Mortgage Loan, an aggregate outstanding principal balance, after
such deduction), not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan (the amount of any shortfall to be paid to the Master Servicer for
deposit in the Custodial Account in the month of substitution); (ii) have a
Mortgage Rate and a Net Mortgage Rate no lower than and not more than 1% per
annum higher than the Mortgage Rate and Net Mortgage Rate, respectively, of the
Deleted Mortgage Loan as of the date of substitution; (iii) have a Loan-to-Value
Ratio at the time of substitution no higher than that of the Deleted Mortgage
Loan at the time of substitution; (iv) have a remaining term to stated maturity
not greater than (and not more than one year less than) that of the Deleted
Mortgage Loan; (v) comply with each representation and warranty set forth in
Section 2.04 hereof; and, (vi) comply with each representation and warranty set
forth in the Mortgage Loan Purchase Agreement.

                  "Radian": Radian Guaranty, Inc. (f/k/a Commonwealth Mortgage
Assurance Company), or its successors or assigns.

                  "Radian Insured Loans": The Mortgage Loans included in the
Trust Fund covered by a Radian Lender-Paid PMI Policy, as indicated on the
Mortgage Loan Schedule.

                  "Radian Lender-Paid PMI Policy": A Primary Insurance Policy
issued by Radian in accordance with a May 1, 2000 letter between the Seller and
Radian.

                  "Radian PMI Policy Rate": With respect to any Radian Insured
Loan, the rate per annum at which the related premium on the Radian Lender-Paid
PMI Policy accrues.

                  "Rating Agency": Standard & Poor's, Fitch or Moody's and each
of their successors. If such agencies and their successors are no longer in
existence, "Rating Agency" shall be such nationally recognized statistical
rating agency, or other comparable Person, designated by the Company, notice of
which designation shall be given to the Trustee and Master Servicer. References
herein to the two highest long term debt rating of a Rating Agency shall mean
"AA" or better in the case of Standard & Poor's, "AA" or better in the case of
Fitch and "Aa2" or better in the case of Moody's and references herein to the
highest short-term debt rating of a Rating Agency shall mean "A-1+" in the case
of Standard & Poor's, F-1 in the case of Fitch and "P-1" in the case of Ms, and
in the case of any other Rating Agency such references shall mean such rating
categories without regard to any plus or minus.



                                       30

<PAGE>



                  "Realized Loss": With respect to each Mortgage Loan or REO
Property as to which a Cash Liquidation or REO Disposition has occurred, an
amount (not less than zero) equal to (i) the Stated Principal Balance of the
Mortgage Loan as of the date of Cash Liquidation or REO Disposition, plus (ii)
interest (and REO Imputed Interest, if any) at the Net Mortgage Rate from the
Due Date as to which interest was last paid or advanced to Certificateholders up
to the date of the Cash Liquidation or REO Disposition on the Stated Principal
Balance of such Mortgage Loan outstanding during each Due Period that such
interest was not paid or advanced, minus (iii) the proceeds, if any, received
during the month in which such Cash Liquidation or REO Disposition occurred, to
the extent applied as recoveries of interest at the Net Mortgage Rate and to
principal of the Mortgage Loan, net of the portion thereof reimbursable to the
Master Servicer or any Sub- Servicer with respect to related Advances or
Servicing Advances not previously reimbursed. With respect to each Mortgage Loan
which has become the subject of a Deficient Valuation, the difference between
the principal balance of the Mortgage Loan outstanding immediately prior to such
Deficient Valuation and the principal balance of the Mortgage Loan as reduced by
the Deficient Valuation.

                  "Record Date": With respect to each Class of Certificates and
each Distribution Date, the last Business Day of the month immediately preceding
the month of the related Distribution Date.

                  "Regular Certificate": Any of the Certificates other than a
Residual Certificate.

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

                  "Relief Act Interest Shortfall": With respect to any
Distribution Date, for any Mortgage Loan with respect to which there has been a
reduction in the amount of interest collectible thereon for the most recently
ended Due Period as a result of the application of the Relief Act, the amount by
which (i) interest collectible on such Mortgage Loan during such Due Period is
less than (ii) one month's interest on the Principal Balance of such Mortgage
Loan at the Loan Rate for such Mortgage Loan before giving effect to the
application of the Relief Act.

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

                  "REMIC 1": The segregated pool of assets, with respect to
which a REMIC election is to be made, conveyed in trust to the Trustee, for the
benefit of the Holders of the REMIC 1 Regular Interests and the Holders of the
Class R Certificates (as holders of the Class R-1 Interest), consisting of: (i)
each Mortgage Loan (exclusive of payments of principal and interest due on or
before the Cut-off Date, if any, received by the Master Servicer which shall not
constitute an asset of the Trust Fund) as from time to time are subject to this
Agreement and all payments under and proceeds of such Mortgage Loans (exclusive
of any prepayment fees and late payment charges received on the Mortgage Loans),
together with all documents included in the related Mortgage File, subject to
Section 2.01; (ii) such funds or assets as from time to time are deposited in
the Custodial Account or the Certificate Account and belonging to the Trust
Fund; (iii) any REO Property; (the Primary Hazard Insurance Policies, if any,
the Primary Insurance Policies, if any, and all other


                                       31

<PAGE>



Insurance Policies with respect to the Mortgage Loans; (v) [reserved]; and (vi)
the Company's interest in respect of the representations and warranties made by
the Seller in the Mortgage Loan Purchase Agreement as assigned to the Trustee
pursuant to Section 2.04 hereof.

                  "REMIC 1 Regular Interest LT1A": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1A shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1B": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1B shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1C": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1C shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1D": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1D shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.

                  "REMIC 1 Regular Interest LT1P": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1P shall
accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate in
effect from time to time, and shall be entitled to any Prepayment Charges
relating to the Mortgage Loans collected by the Master Servicer and to a
distribution of principal, sto the terms and conditions hereof, in an aggregate
amount equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 1 Regular Interests": REMIC 1 Regular Interest LT1A,
REMIC 1 Regular Interest LT1B, REMIC 1 Regular Interest LT1C, REMIC 1 Regular
Interest LT1D and REMIC 1 Regular Interest LT1P.



                                       32

<PAGE>



                  "REMIC 2": The segregated pool of assets consisting of all of
the REMIC 1 Regular Interests conveyed in trust to the Trustee, for the benefit
of REMIC 3, as holder of the REMIC 2 Regular Interests, and the Class R
Certificateholders, as holders of the Class R-2 Interest, pursuant to Article II
hereunder, and all amounts deposited therein, with respect to which a separate
REMIC election is to be made.

                  "REMIC 2 Group 1 Interest Loss Allocation Amount": With
respect to any Distribution Date, an amount equal to (a) the product of (i) the
aggregate Principal Balance of the Group 1 Loans and related REO Properties then
outstanding and (ii) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2A minus the Group 1 Marker Rate, divided by (b) 12.

                  "REMIC 2 Group 2 Interest Loss Allocation Amount": With
respect to any Distribution Date, an amount equal to (a) the product of (i) the
aggregate Principal Balance of the Group 2 Loans and related REO Properties then
outstanding and (ii) the Uncertificated REMIC 2 Pass-Through Rate for REMIC 2
Regular Interest LT2G minus the Group 2 Marker Rate, divided by (b) 12.

                  "REMIC 2 Group 1 Overcollateralized Amount": With respect to
any date of determination, (i) 1% of the aggregate Uncertificated Principal
Balances of REMIC 2 Regular Interest LT2A, REMIC 2 Regular Interest LT2B, REMIC
2 Regular Interest LT2C, REMIC 2 Regular Interest LT2D, REMIC 2 Regular Interest
LT2E and REMIC 2 Regular Interest LT2F, minus (ii) the aggregate of the
Uncertificated Principal Balances of REMIC 2 Regular Interest LT2B, REMIC 2
Regular Interest LT2C, REMIC 2 Regular Interest LT2D and REMIC 2 Regular
Interest LT2E, in each case as of such date of determination.

                  "REMIC 2 Group 2 Overcollateralized Amount": With respect to
any date of determination, (i) 1% of the aggregate Uncertificated Principal
Balances of REMIC 2 Regular Interest LT2G, REMIC 2 Regular Interest LT2H, REMIC
2 Regular Interest LT2I, REMIC 2 Regular Interest LT2J, REMIC 2 Regular Interest
LT2K and REMIC 2 Regular Interest LT2L, minus (ii) the aggregate of the
Uncertificated Principal Balances of REMIC 2 Regular Interest LT2H, REMIC 2
Regular Interest LT2I, REMIC 2 Regular Interest LT2J and REMIC 2 Regular
Interest LT2K, in each case as of such date of determination.

                  "REMIC 2 Group 1 Principal Loss Allocation Amount": With
respect to any Distribution Date and the Group 1 Loans, an amount equal to (a)
the product of (i) the aggregate Principal Balance of the Group 1 Loans and
related REO Properties then outstanding and (ii) 1 minus a fraction, the
numerator of which is two times the aggregate of the Uncertificated Principal
Balances of REMIC 2 Regular Interest LT2B, REMIC 2 Regular Interest LT2C, REMIC
2 Regular Interest LT2D and REMIC 2 Regular Interest LT2E, and the denominator
of which is the aggregate of the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2B, REMIC 2 Regular Interest LT2C, REMIC 2 Regular Interest
LT2D, REMIC 2 Regular Interest LT2E and REMIC 2 Regular Interest LT2F.



                                       33

<PAGE>



                  "REMIC 2 Group 2 Principal Loss Allocation Amount": With
respect to any Distribution Date and the Group 2 Loans, an amount equal to (a)
the product of (i) the aggregate Principal Balance of the Group 2 Loans and
related REO Properties then outstanding and (ii) 1 minus a fraction, the
numerator of which is two times the aggregate of the Uncertificated Principal
Balances of REMIC 2 Regular Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC
2 Regular Interest LT2J and REMIC 2 Regular Interest LT2K, and the denominator
of which is the aggregate of the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC 2 Regular Interest
LT2J, REMIC 2 Regular Interest LT2K and REMIC 2 Regular Interest LT2L.

                  "REMIC 2 Overcollateralization Target Amount": 1% of the
Overcollateralization Target Amount.

                  "REMIC 2 Regular Interest LT2A": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2A
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2A-IO": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular i in REMIC 2. REMIC 2 Regular Interest LT2A-IO shall
accrue interest at the related Uncertificated REMIC 2 Pass-Through Rate on its
Uncertificated Notional Amount outstanding from time to time.

                  "REMIC 2 Regular Interest LT2B": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2B
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2C": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2C
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2D": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2D
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject


                                       34

<PAGE>



to the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto.

                  "REMIC 2 Regular Interest LT2E": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2E
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2F": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2F
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2G": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2G
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2H": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2H
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2I": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2I
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2J": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2J
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.


                                       35

<PAGE>



                  "REMIC 2 Regular Interest LT2K": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2K
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2L": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2L
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.

                  "REMIC 2 Regular Interest LT2P": One of the separate
non-certificated beneficial ownership interests in REMIC 2 issued hereunder and
designated as a "regular interest" in REMIC 2. REMIC 2 Regular Interest LT2P
shall accrue interest at the related Uncertificated REMIC 2 Pass- Through Rate
in effect from time to time, and shall be entitled to any amounts distributed to
REMIC 1 Regular Interest LT1P.

                  "REMIC 2 Regular Interests": REMIC 2 Regular Interest LT2A,
REMIC 2 Regular Interest LT2A-IO, REMIC 2 Regular Interest LT2B, REMIC 2 Regular
Interest LT2C, REMIC 2 Regular Interest LT2D, REMIC 2 Regular Interest LT2E,
REMIC 2 Regular Interest LT2F, REMIC 2 Regular Interest LT2G, REMIC 2 Regular
Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC 2 Regular Interest LT2J,
REMIC 2 Regular Interest LT2K, REMIC 2 Regular Interest LT2L and REMIC 2 Regular
Interest LT2P.

                  "REMIC 3": The segregated pool of assets consisting of all of
the REMIC 2 Regular Interests conveyed in trust to the Trustee, for the benefit
of the Holders of the Regular Certificates and the Holders of the Class R
Certificates (as holders of the Class R-3 Interest), pursuant to Article II
hereunder, and all amounts deposited therein, with respect to which a separate
REMIC election is to be made.

                  "REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Sections
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and proposed, temporary and final regulations and published rulings,
notices and announcements promulgated thereunder, as the foregoing may be in
effect from time to time.

                  "REMIC Regular Interest": A REMIC 1 Regular Interest or REMIC
2 Regular Interest.

                  "Remittance Report": A report prepared by the Master Servicer
providing the information set forth in Exhibit E attached hereto.


                                       36

<PAGE>



                  "REO Acquisition": The acquisition by the Master Servicer on
behalf of the Trustee for the benefit of the Certificateholders of any REO
Property pursuant to Section 3.15.

                  "REO Disposition": The receipt by the Master Servicer of
Insurance Proceeds, Liquidation Proceeds and other payments and recoveries
(including proceeds of a final sale) which the Master Servicer expects to be
finally recoverable from the sale or other disposition of the REO Property.

                  "REO Imputed Interest": As to any REO Property, for any
period, an amount equivalent to interest (at the Mortgage Rate that would have
been applicable to the related Mortgage Loan had it been outstanding) on the
unpaid principal balance of the Mortgage Loan as of the date of acquisition
thereof (as such balance is reduced pursuant to Section 3.15 by any income from
the REO Property treated as a recovery of principal).

                  "REO Proceeds": Proceeds, net of directly related expenses,
received in respect of any REO Property (including, without limitation, proceeds
from the rental of the related Mortgaged Property and of any REO Disposition),
which proceeds are required to be deposited into the Custodial Account as and
when received.

                  "REO Property": A Mortgaged Property acquired by the Master
Servicer on behalf of the Trust Fund through foreclosure or deed-in-lieu of
foreclosure in connection with a defaulted Mortgage Loan.

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

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

                  "Responsible Officer": When used with respect to the Trustee,
the Chairman or Vice Chairman of the Board of Directors or Trustees, the
Chairman or Vice Chairman of the Executive or Standing Committee of the Board of
Directors or Trustees, the President, the Chairman of the Committee on Trust
Matters, any vice president, any assistant vice president, the Secretary, any
assistant secretary, the Treasurer, any assistant treasurer, any trust officer
or assistant trust oor any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also, with respect to a particular matter, any other officer to whom such matter
is referred because of such officer's knowledge of and familiarity with the
particular subject.

                  "Seller": Impac Funding Corporation, or its successor in
interest.

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



                                       37

<PAGE>



                  "Servicing Advances": All customary, reasonable and necessary
"out of pocket" costs and expenses incurred in connection with a default,
delinquency or other unanticipated event in the performance by the Master
Servicer or any Sub-Servicer of its servicing obligations, including, but not
limited to, the cost of (i) the preservation, restoration and protection of a
Mortgaged Property, (ii) any enforcement or judicial proceedings, including
foreclosures, (iii) the management and liquidation of any REO Property,
including reasonable fees paid to any independent contractor in connection
therewith, and (iv) compliance with the obligations under the fourth paragraph
of Section 3.01, Section 3.09 and Section 3.13 (other than any deductible
described in the last paragraph thereof).

                  "Servicing Guide": The Impac Funding Corporation Servicing
Guide attached hereto as Exhibit K.

                  "Servicing Officer": Any officer of the Master Servicer
involved in, or responsible for, the administration and servicing of the
Mortgage Loans, whose name and specimen signature appear on a list of servicing
officers furnished to the Trustee by the Master Servicer, as such list may from
time to time be amended.

                  "Single Certificate": A Regular Certificate of any Class
(other than a Class P Certificate) evidencing an Initial Certificate Principal
Balance or Initial Notional Amount, as applicable, of $1,000, or, in the case of
a Class P Certificate, a Certificate of such Class evidencing an Initial
Certificate Principal Balance of $100.

                  "Special Deposit":  As defined in Section 2.01(a).

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

                  "Startup Day": The day designated as such pursuant to Article
X hereof.

                  "Stated Principal Balance": With respect to any Mortgage Loan
or related REO Property at any given time, (i) the principal balance of the
Mortgage Loan outstanding as of the Cut- off Date, after application of
principal payments due on or before such date, whether or not received, minus
(ii) the sum of (a) the principal portion of the Monthly Payments due with
respect to such Mortgage Loan or REO Property during each Due Period ending
prior to the most recent Distribution Date which were received or with respect
to which an Advance was made, and (b) all Principal Prepayments with respect to
such Mortgage Loan or REO Property, and all Insurance Proceeds, Liquidation
Proceeds and REO Proceeds to the extent applied by the Master Servicer as
recoveries of principal in accordance with Section 3.15 with respect to such
Mortgage Loan or REO Property, which were distributed pursuant to Section 4.01
on any previous Distribution Date, and (c) any Realized Loss with respect
thereto allocated pursuant to Section 4.05 for any previous Distribution Date.



                                       38

<PAGE>



                  "Stepdown Date": The earlier to occur of (i) the Distribution
Date on which the aggregate Certificate Principal Balance of the Class A
Certificates has been reduced to zero and (ii) the later to occur of (x) the
Distribution Date occurring in May 2004 and (y) the first Distribution Date for
which the aggregate Certificate Principal Balance of the Mezzanine Certificates
divided by the aggregate Stated Principal Balance of the Mortgage Loans as of
the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period, and after reduction for Realized Losses incurred
during the related Prepayment Period) is greater than or equal to 14.00%.

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

                  "Sub-Servicer Remittance Date": The 18th day of each month, or
if such day is not a Business Day, the immediately preceding Business Day.

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

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

                  "Sub-Servicing Fees": As to each Mortgage Loan, an amount,
payable out of any payment of interest on the Mortgage Loan, equal to interest
at the Sub-Servicing Fee Rate on the Stated Principal Balance of such Mortgage
Loan for the calendar month preceding the month in which the payment is due
(alternatively, in the event such payment of interest accompanies a Principal
Prepayment in Full made by the Mortgagor, interest for the number of days
covered by such payment of interest).

                  "Sub-Servicing Fee Rate": With respect to each Mortgage Loan,
the per annum rate of 0.25%.

                  "Substitution Adjustment":  As defined in Section 2.04 hereof.

                  "Tax Returns": The federal income tax return on Internal
Revenue Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income
Tax Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any successor forms,
to be filed on behalf of REMIC 1, REMIC 2 and REMIC 3 due to their
classification as REMICs under the REMIC Provisions, together with any and all
other information, reports or returns that may be required to be furnished to
the Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.



                                       39

<PAGE>



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

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

                  "Trigger Event": A Trigger Event is in effect with respect to
any Distribution Date if

         (i)      the aggregate Stated Principal Balance of Mortgage Loans that
                  are 60 or more days delinquent as of the close of business on
                  the last day of the preceding calendar month exceeds 2.25% (in
                  the case of the 36th Distribution Date through the 60th
                  Distribution Date) or 3.25% (in the case of any Distribution
                  Date thereafter) of the aggregate Stated Principal Balance of
                  the Mortgage Loans as of such Distribution Date (prior to
                  giving effect to scheduled payments of principal due during
                  the related Due Period, to the extent received or advanced,
                  and unscheduled collections of principal received during the
                  related Prepayment Period); or

         (ii)     in the case of any Distribution Date after the 36th
                  Distribution Date, the cumulative amount of Realized Losses
                  incurred on the Mortgage Loans from the Cut-off Date through
                  the end of the calendar month immediately preceding such
                  Distribution Date exceeds 10.00% of the sum of (x) the
                  aggregate Certificate Principal Balance of the Mezzanine
                  Certificates (or, if the Certificate Principal Balances of the
                  Class A Certificates have been reduced to zero, the aggregate
                  Certificate Principal Balance of the Mezzanine Certificates
                  other than the Class of Mezzanine Certificates with the
                  highest payment priority) after giving effect to distributions
                  that would be made on such Distribution Date if no Trigger
                  Event were in effect and (y) the Overcollateralized Amount.

For purposes of the foregoing calculation, a mortgage loan is considered "60
days" delinquent if a payment due on the first day of a month has not been
received by the second day of the second following month.

                  "Trust Fund": REMIC 1, REMIC 2 and REMIC 3.

                  "Trustee": Bankers Trust Company of California, N.A., or its
successor in interest, or any successor trustee appointed as herein provided.

                  "Trustee's Fee": As to each Mortgage Loan and Distribution
Date, an amount equal to interest at the Trustee Fee Rate on the Stated
Principal Balance of such Mortgage Loan as of the Due Date in the month
immediately preceding the month in which such Distribution Date occurs.

                  "Trustee Fee Rate": 0.005% per annum.



                                       40

<PAGE>



                  "Uncertificated Accrued Interest": With respect to each REMIC
Regular Interest on each Distribution Date, an amount equal to one month's
interest at the related Uncertificated P Through Rate on the Uncertificated
Principal Balance or Uncertificated Notional Amount, as applicable, of such
REMIC Regular Interest. In each case, Uncertificated Accrued Interest will be
reduced by any Net Prepayment Interest Shortfalls and Relief Act Interest
Shortfalls (allocated to such REMIC Regular Interests as set forth in Section
1.02).

                  "Uncertificated Notional Amount": With respect to each of
REMIC 2 Regular Interest LT2A-IO and any date of determination, the
Uncertificated Principal Balance of R1 Regular Interest LT1D for such
Distribution Date.

                  "Uncertificated Principal Balance": With respect to each REMIC
1 Regular Interest and REMIC 2 Regular Interest (other than REMIC 2 Regular
Interest LT2A-IO), the principal amount of such REMIC Regular Interest
outstanding as of any date of determination. As of the Closing Date, the
Uncertificated Principal Balance of each REMIC 1 Regular Interest, REMIC 2
Regular Interest (other than REMIC 2 Regular Interest LT2A-IO) shall equal the
amount set forth in the Preliminary Statement hereto as its initial
Uncertificated Principal Balance. On each Distribution Date, the Uncertificated
Principal Balance of each REMIC Regular Interest shall be reduced by all
distributions of principal made on such REMIC Regular Interest on such
Distribution Date pursuant to Section 4.04 and, if and to the extent necessary
and appropriate, shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 4.05. The Uncertificated Principal Balance of each
of REMIC 2 Regular Interest LT2F and REMIC 2 Regular Interest LT2L shall be
increased by interest deferrals as provided in Section 4.04. The Uncertificated
Principal Balance of each REMIC Regular Interest shall never be less than zero.
REMIC 2 Regular Interest LT2A-IO will not have an Uncertificated Principal
Balance.

                  "Uncertificated Pass-Through Rate": The Uncertificated REMIC 1
Pass-Through Rate or the Uncertificated REMIC 2 Pass-Through Rate.

                  "Uncertificated REMIC 1 Pass-Through Rate": With respect to
any Distribution Date and REMIC 1 Regular Interest LT1A, REMIC 1 Regular
Interest LT1D and REMIC 1 Regular Interest LT1P, a per annum rate equal to the
average of the Net Mortgage Rates of the Mortgage Loans, weighted on the basis
of the Stated Principal Balances thereof as of the close of business on the last
day of the calendar month preceding the month in which such Distribution Date
occurs. With respect to any Distribution Date and REMIC 1 Regular Interest LT1B,
a per annum rate equal to the average of the Net Mortgage Rates of the Group 1
Mortgage Loans, weighted on the basis of the Stated Principal Balances thereof
as of the close of business on the last day of the calendar month preceding the
month in which such Distribution Date occurs. With respect to any Distribution
Date and REMIC 1 Regular Interest LT1C, a per annum rate equal to the average of
the Net Mortgage Rates of the Group 2 Mortgage Loans, weighted on the basis of
the Stated Principal Balances thereof as of the close of business on the last
day of the calendar month preceding the month in which such Distribution Date
occurs.

                  "Uncertificated REMIC 2 Pass-Through Rate":


                                       41

<PAGE>



                  (a) With respect to REMIC 2 Regular Interest LT2A, REMIC 2
Regular Interest LT2B, REMIC 2 Regular Interest LT2C, REMIC 2 Regular Interest
LT2D, REMIC 2 Regular Interest LT2E, REMIC 2 Regular Interest LT2F, REMIC 2
Regular Interest LT2G, REMIC 2 Regular Interest LT2H, REMIC 2 Regular Interest
LT2I, REMIC 2 Regular Interest LT2J, REMIC 2 Regular Interest LT2K, REMIC 2
Regular Interest LT2L and REMIC 2 Regular Interest LT2P and any Distribution
Date prior to and including the Distribution Date in October 2003, a per annum
rate equal to the Net WAC Rate. With respect to REMIC 2 Regular Interest LT2A,
REMIC 2 Regular Interest LT2B, REMIC 2 Regular Interest LT2C, REMIC 2 Regular
Interest LT2D, REMIC 2 Regular Interest LT2E, REMIC 2 Regular Interest LT2F, and
REMIC 2 Regular Interest LT2P and any Distribution Date after the Distribution
Date in October 2003, a per annum rate equal to the Uncertificated REMIC 1
Pass-Through Rate of the Uncertificated REMIC 1 Regular Interest LT1B. With
respect to REMIC 2 Regular Interest LT2G, REMIC 2 Regular Interest LT2H, REMIC 2
Regular Interest LT2I, REMIC 2 Regular Interest LT2J, REMIC 2 Regular Interest
LT2K and REMIC 2 Regular Interest LT2L and any Distribution Date after the
Distribution Date in October 2003, a per annum rate equal to the Uncertificated
REMIC 1 Pass-Through Rate of the Uncertificated REMIC 1 Regular Interest LT1C.

                  (b) With respect to REMIC 2 Regular Interest LT2A-IO and the
first 30 Distribution Dates, the Class A-IO Rate, and 0.00% per annum
thereafter.

                  "Uninsured Cause": Any cause of damage to property subject to
a Mortgage sthat the complete restoration of such property is not fully
reimbursable by the hazard insurance policies or flood insurance policies
required to be maintained pursuant to Section 3.13.

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

                  "Unpaid Interest Shortfall Amount": With respect to the Class
A Certificates and Mezzanine Certificates and (i) the first Distribution Date,
zero, and (ii) any Distribution Date after


                                       42

<PAGE>



the first Distribution Date, the amount, if any, by which (a) the sum of (1) the
Monthly Interest Distributable Amount for such Class for the immediately
preceding Distribution Date and (2) the outstanding Unpaid Interest Shortfall
Amount, if any, for such Class for such preceding Distribution Date exceeds (b)
the aggregate amount distributed on such Class in respect of interest pursuant
to clause (a) of this definition on such preceding Distribution Date, plus
interest on the amount of interest due but not paid on the Certificates of such
Class on such preceding Distribution Date, to the extent permitted by law, at
the Pass-Through Rate for such Class for the related Accrual Period.

                  "Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. At all times during the
term of this Agreement, (i) 97% of all Voting Rights will be allocated among the
Holders of the Class A Certificates (other than the Class A- Certificates), the
Mezzanine Certificates and the Class C Certificates in proportion to the then
outstanding Certificate Principal Balances of their respective Certificates,
(ii) 1% of all Voting Rights will be allocated to the Holders of the Class A-IO
Certificates, (iii) 1% of all Voting Rights will be allocated to the Holders of
the Class P Certificates and (iv) 1% of all Voting Rights will be allocated to
the Holders of the Class R Certificates. The Voting Rights allocated to any
Class of Certificates shall be allocated among all Holders of the Certificates
of such Class in proportion to the outstanding Percentage Interests in such
Class represented thereby.

                  "Weighted Average Net Mortgage Rate": The weighted average of
the Net Mortgage Rates of the Mortgage Loans, weighted on the basis of the
Stated Principal Balances thereof as of the close of business on the first day
of the calendar month preceding the month in which such Distribution Date
occurs.

                  "Wendover": Wendover Funding, Inc.

         SECTION 1.02               Allocation of Certain Interest Shortfalls.

                  For purposes of calculating the amount of the Monthly Interest
Distributable Amount for the Class A Certificates, the Mezzanine Certificates
and the Class C Certificates for any Distribution Date, (1) the aggregate amount
of any Net Prepayment Interest Shortfalls and any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated first, among the Class C Certificates on a pro rata basis based on,
and to the extent of, one month's interest at the then applicable Pass-Through
Rate on the Notional Amount of each such Certificate and, thereafter, among the
Class A Certificates and the Mezzanine Certificates on a pro rata basis based
on, and to the extent of, one month's interest at the then applicable respective
Pass- Through Rate on the respective Certificate Principal Balance of each such
Certificate and (2) the aggregate amount of any Realized Losses incurred for any
Distribution Date shall be allocated among the Class C Certificates on a pro
rata basis based on, and to the extent of, one month's interest at the then
applicable Pass-Through Rate on the Notional Amount of each such Certificate.

         For purposes of calculating the amount of Uncertificated Accrued
Interest for the Uncertificated REMIC 1 Regular Interests for any Distribution
Date, the aggregate amount of any Net Prepayment Interest Shortfalls and any
Relief Act Interest Shortfalls incurred in respect of the


                                       43

<PAGE>



Mortgage Loans for any Distribution Date shall be allocated first: with respect
to any Group 1 Loan, to REMIC 1 Regular Interest LT1A and REMIC 1 Regular
Interest LT1B, 99% and 1%, respectively, and with respect to any Group 2 Loan,
to REMIC 1 Regular Interest LT1A and REMIC 1 Regular Interest LT1C, 99% and 1%,
respectively, and then to REMIC 1 Regular Interest LT1D, in each case to the
extent of one month's interest at the then applicable respective Uncertificated
REMIC 1 Pass- Through Rate on the respective Uncertificated Principal Balance of
each such Uncertificated REMIC 1 Regular Interest.

         For purposes of calculating the amount of Uncertificated Accrued
Interest for the Uncertificated REMIC 2 Regular Interests for any Distribution
Date, the aggregate amount of any Net Prepayment Interest Shortfalls and any
Relief Act Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated (i) with respect to the Group 1 Loans,
first, to Uncertificated Accrued Interest payable to REMIC 2 Regular Interest
LT2A and R2 Regular Interest LT2F up to an aggregate amount equal to the REMIC 2
Group 1 Interest Loss Allocation Amount, 98% and 2%, respectively, and
thereafter among REMIC 2 Regular Interest LT2A-IO, REMIC 2 Regular Interest
LT2A, REMIC 2 Regular Interest LT2B, REMIC 2 Regular Interest LT2C, REMIC 2
Regular Interest LT2D, REMIC 2 Regular Interest LT2E and REMIC 2 Regular
Interest LT2F, PRO RATA based on, and to the extent of, one month's interest at
the then applicable respective Uncertificated REMIC 2 Pass-Through Rate on the
respective Uncertificated Principal Balance of each such Uncertificated REMIC 2
Regular Interest, and (ii) with respect to the Group 2 Loans, first, to
Uncertificated Accrued Interest payable to REMIC 2 Regular Interest LT2G and
REMIC 2 Regular Interest LT2L up to an aggregate amount equal to the REMIC 2
Group 2 Interest Loss Allocation Amount, 98% and 2%, respectively, and
thereafter among REMIC 2 Regular Interest LT2A-IO, REMIC 2 Regular Interest
LT2G, REMIC 2 Regular Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC 2
Regular Interest LT2J, REMIC 2 Regular Interest LT2K and REMIC 2 Regular
Interest LT2L, PRO RATA based on, and to the extent of, one month's interest at
the then applicable respective Uncertificated REMIC 2 Pass-Through Rate on the
respective Uncertificated Principal Balance of each such Uncertificated REMIC 2
Regular Interest.


                                       44

<PAGE>



                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

                  SECTION 2.01.             Conveyance of Mortgage Loans.

                  The Company, as of the Closing Date, and concurrently with the
execution and delivery hereof, does hereby assign, transfer, sell, set over and
otherwise convey to the Trustee without recourse all the right, title and
interest of the Company in and to the Mortgage Loans identified on the Mortgage
Loan Schedule (exclusive of any prepayment fees and late payment charges
received thereon) and all other assets included or to be included in the Trust
Fund for the benefit of the Certificateholders. Such assignment includes all
principal and interest received by the Master Servicer on or with respect to the
Mortgage Loans (other than payment of principal and interest due on or before
the Cut-off Date).

                  The Master Servicer hereby acknowledges the receipt by it of
cash in an amount equal to $66,734.75 (the "Special Deposit"), representing
interest at the Mortgage Rate, for the calendar month of April 2001, for those
Mortgage Loans which do not have Monthly Payments due on May 1, 2001. The Master
Servicer shall hold such amount in the Custodial Account and shall include such
amount in the Available Distribution Amount for the Distribution Date in May
2001.

                  In connection with such transfer and assignment, the Company
has caused the Seller to deliver to, and deposit with the Trustee, as described
in the Mortgage Loan Purchase Agreement the following documents or instruments:

                (i) the original Mortgage Note endorsed without recourse,
         "Bankers Trust Company of California, N.A., as trustee under the
         Pooling and Servicing Agreement relating to Impac Secured Assets Corp.,
         Mortgage Pass-Through Certificates, Series 2001-3" with all intervening
         endorsements showing an unbroken chain of endorsements from the
         originator to the Person endorsing it to the Trustee or, with respect
         to any Mortgage Las to which the original Mortgage Note has been
         permanently lost or destroyed and has not been replaced, a Lost Note
         Affidavit;

               (ii) the original recorded Mortgage or, if the original Mortgage
         has not been returned from the public recording office, a copy of the
         Mortgage certified by the Seller or the public recording office in
         which such Mortgage has been recorded to be a true and complete copy of
         the original Mortgage submitted for recording;

              (iii) a duly executed original Assignment of the Mortgage, without
         recourse, in recordable form to "Bankers Trust Company of California,
         N.A., as trustee," or to "Banker Trust Company of California, N.A., as
         trustee for holders of Impac Secured Assets Corp., Mortgage
         Pass-Through Certificates, Series 2001-3";



                                       45

<PAGE>



               (iv) the original recorded Assignment or Assignments of the
         Mortgage showing an unbroken chain of assignment from the originator
         thereof to the Person assigning it to the Trustee or, if any such
         Assignment has not been returned from the applicable public recording
         office, a copy of such Assignment certified by the Seller to be a true
         and complete copy of the original Assignment submitted to the title
         insurance company for recording;

                (v) the original title insurance policy, or, if such policy has
         not been issued, any one of an original or a copy of the preliminary
         title report, title binder or title commitment on the Mortgaged
         Property with the original policy of the insurance to be delivered
         promptly following the receipt thereof;

              (vi) a copy of the related hazard insurance policy; and

              (vii) a true and correct copy of any assumption, modification,
         consolidation or substitution agreement.

                  The Seller is obligated as described in the Mortgage Loan
Purchase Agreement to deliver to the Trustee: (a) either the original recorded
Mortgage, or in the event such original cannot be delivered by the Seller, a
copy of such Mortgage certified as true and complete by the appropriate
recording office, in those instances where a copy thereof certified by the
Seller was delivered to the Trustee pursuant to clause (ii) above; and (b)
either the original Assignment or Assignments of the Mortgage, with evidence of
recording thereon, showing an unbroken chain of assignment from the originator
to the Seller, or in the event such original cannot be delivered by the Seller,
a copy of such Assignment or Assignments certified as true and complete by the
appropriate recording office, in those instances where copies thereof certified
by the Seller were delivered to the Trustee pursuant to clause (iv) above.
However, pursuant to the Mortgage Loan Purchase Agreement, the Seller need not
cause to be recorded any assignment in any jurisdiction under the laws of which,
as evidenced by an Opinion of Counsel delivered by the Seller to the Trustee and
the Rating Agencies, the recordation of such assignment is not necessary to
protect the Trustee's interest in the related Mortgage Loan; provided, however,
notwithstanding the delivery of any Opinion of Counsel, each assignment shall be
submitted for recording by the Seller in the manner described above, at no
expense to the Trust or the Trustee, upon the earliest to occur of: (i)
direction by the Holders of Certificates evidencing at least 25% of the Voting
Rights, (ii) the occurrence of a Event of Default, (iii) the occurrence of a
bankruptcy, insolvency or foreclosure relating to the Seller, (iv) the
occurrence of a servicing transfer as described in Section 7.02 hereof and (v)
if the Seller is not the Master Servicer and with respect to any one assignment,
the occurrence of a bankruptcy, insolvency or foreclosure relating to the
Mortgagor under the related Mortgage.

                  Notwithstanding anything to the contrary contained in this
Section 2.01, in those instances where the public recording office retains the
original Mortgage after it has been recorded, the Seller shall be deemed to have
satisfied its obligations hereunder upon delivery to the Trustee of a copy of
such Mortgage certified by the public recording office to be a true and complete
copy of the recorded original thereof.



                                       46

<PAGE>



                  If any Assignment is lost or returned unrecorded to the
Trustee because of any defect therein, the Seller is required, as described in
the Mortgage Loan Purchase Agreement, to prepare a substitute Assignment or cure
such defect, as the case may be, and the Seller shall cause such Assignment to
be recorded in accordance with this section.

                  The Seller is required as described in the Mortgage Loan
Purchase Agreement to exercise its best reasonable efforts to deliver or cause
to be delivered to the Trustee within 120 days of the Closing Date the original
or a photocopy of the title insurance policy with respect to each Mortgage Loan
assigned to the Trustee pursuant to this Section 2.01.

                  All original documents relating to the Mortgage Loans which
are not delivered to the Trustee are and shall be held by the Master Servicer in
trust for the benefit of the Trustee on behalf of the Certificateholders.

                  Except as may otherwise expressly be provided herein, none of
the Company, the Master Servicer or the Trustee shall (and the Master Servicer
shall ensure that no Sub-Servicer shall) assign, sell, dispose of or transfer
any interest in the Trust Fund or any portion thereof, or cause the Trust Fund
or any portion thereof to be subject to any lien, claim, mortgage, security
interest, pledge or other encumbrance.

                  It is intended that the conveyance of the Mortgage Loans by
the Company to the Trustee as provided in this Section be, and be construed as,
a sale of the Mortgage Loans and the REMIC 1 Regular Interests as provided for
in this Section 2.01 by the Company to the Trustee for the benefit of the
Certificateholders. It is, further, not intended that such conveyance be deemed
a pledge of the Mortgage Loans and the REMIC 1 Regular Interests by the Company
to the Trustee to secure a debt or other obligation of the Company. However, in
the event that the Mortgage Loans and the REMIC 1 Regular Interests are held to
be property of the Company, or if for any reason this Agreement is held or
deemed to create a security interest in the Mortgage Loans and the REMIC 1
Regular Interests, then it is intended that, (a) this Agreement shall also be
deemed to be a security agreement within the meaning of Articles 8 and 9 of the
New York Uniform Commercial Code and the Uniform Commercial Code of any other
applicable jurisdiction; (b) the conveyance provided for in this Section shall
be deemed to be (1) a grant by the Company to the Trustee of a security interest
in all of the Company's right (including the power to convey title thereto),
title and interest, whether now owned or hereafter acquired, in and to (A) the
Mortgage Loans, including the Mortgage Notes, the Mortgages, any related
Insurance Policies and all other documents in the related Mortgage Files, (B)
all amounts payable to the holders of the Mortgage Loans in accordance with the
terms thereof, (C) the REMIC 1 Regular Interests and (D) all proceeds of the
conversion, voluntary or involuntary, of the foregoing into cash, instruments,
securities or other property, including without limitation all amounts from time
to time held or invested in the Certificate Account or the Custodial Account,
whether in the form of cash, instruments, securities or other property and (2)
an assignment by the Company to the Trustee of any security interest in any and
all of the Seller's right (including the power to convey title thereto), title
and interest, whether now owned or hereafter acquired, in and to the property
described in the foregoing clauses (1)(A) through (D); (c) the possession by the
Trustee or any other agent of the Trustee of Mortgage Notes and such other items
of property as


                                       47

<PAGE>



constitute instruments, money, negotiable documents or chattel paper shall be
deemed to be "possession by the secured party" or possession by a purchaser or a
person designated by such secured party, for purposes of perfecting the security
interest pursuant to the New York Uniform Commercial Code and the Uniform
Commercial Code of any other applicable jurisdiction (including, without
limitation, Sections 9-115, 9-305, 8-102, 8-301, 8-501 and 8-503 thereof); and
(d) notifications to persons holding such property, and acknowledgments,
receipts or confirmations from persons holding such property, shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Trustee for the purpose
of perfecting such security interest under applicable law. The Company and the
Trustee shall, to the extent consistent with this Agreement, take such actions
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the Mortgage Loans and the REMIC 1 Regular Interests, such
security interest would be deemed to be a perfected security interest of first
priority under applicable law and will be maintained as such throughout the term
of the Agreement.

                  SECTION 2.02.             Acceptance of the Trust Fund by the
                                            Trustee.

                  The Trustee acknowledges receipt (subject to any exceptions
noted in the Initial Certification described below), of the documents referred
to in Section 2.01 above and all other assets included in the definition of
"Trust Fund" and declares that it holds and will hold such documents and the
other documents delivered to it constituting the Mortgage Files, and that it
holds or will hold such other assets included in the definition of "Trust Fund"
(to the extent delivered or assigned to the Trustee), in trust for the exclusive
use and benefit of all present and future Certificateholders.

                  The Trustee agrees, for the benefit of the Certificateholders,
to review or cause to be reviewed on its behalf, each Mortgage File on or before
the Closing Date to ascertain that all documents required to be delivered to it
are in its possession, and the Trustee agrees to execute and deliver, or cause
to be executed and delivered, to the Company and the Master Servicer on the
Closing Date, an Initial Certification in the form annexed hereto as Exhibit C
to the effect that, as to each Mortgage Loan listed in the Mortgage Loan
Schedule (other than any Mortgage Loan paid in full or any Mortgage Loan
specifically identified in such certification as not covered by such
certification), (i) all documents required to be delivered to it pursuant to
this Agreement with respect to such Mortgage Loan are in its possession, (ii)
such documents have been reviewed by it and appear regular on their face and
relate to such Mortgage Loan and (iii) based on its examination and only as to
the foregoing documents, the information set forth in items (i), (ii), (iii)(A)
and (iv) of the definition of the "Mortgage Loan Schedule" accurately reflects
information set forth in the Mortgage File. Neither the Trustee nor the Master
Servicer shall be under any duty to determine whether any Mortgage File should
include any of the documents specified in clause (vi) or (vii) of Section 2.01.
Neither the Trustee nor the Master Servicer shall be under any duty or
obligation to inspect, review or examine said documents, instruments,
certificates or other papers to determine that the same are genuine, enforceable
or appropriate for the represented purpose or that they have actually been
recorded, or they are in recordable form or that they are other than what they
purport to be on their face.


                                       48

<PAGE>



                  Within 90 days of the Closing Date the Trustee shall deliver
to the Company and the Master Servicer a Final Certification in the form annexed
hereto as Exhibit D evidencing the completeness of the Mortgage Files, with any
applicable exceptions noted thereon.

                  If in the process of reviewing the Mortgage Files and
preparing the certifications referred to above the Trustee finds any document or
documents constituting a part of a Mortgage File to be missing or defective in
any material respect, the Trustee shall promptly notify the Seller, the Master
Servicer and the Company. The Trustee shall promptly notify the Seller of such
defect and request that the Seller cure any such defect within 60 days from the
date on which the Seller was notified of such defect, and if the Seller does not
cure such defect in all material respects during such period, request on behalf
of the Certificateholders that the Seller purchase such Mortgage Loan from the
Trust Fund at the Purchase Price within 90 days after the date on which the
Seller was notified of such defect; provided that if such defect would cause the
Mortgage Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure or repurchase must occur within 90 days
from the date such breach was discovered. It is understood and agreed that the
obligation of the Seller to cure a material defect in, or purchase any Mortgage
Loan as to which a material defect in a constituent document exists shall
constitute the sole remedy respecting such defect available to
Certificateholders or the Trustee on behalf of Certificateholders. The Purchase
Price for the purchased Mortgage Loan shall be deposited or caused to be
deposited upon receipt by the Master Servicer in the Custodial Account and, upon
receipt by the Trustee of written notification of such deposit signed by a
Servicing Officer, the Trustee shall release or cause to be released to the
Seller the related Mortgage File and shall execute and deliver such instruments
of transfer or assignment, in each case without recourse, as the Seller shall
require as necessary to vest in the Seller ownership of any Mortgage Loan
released pursuant hereto and at such time the Trustee shall have no further
responsibility with respect to the related Mortgage File.

                  SECTION 2.03.             Representations, Warranties and
                                            Covenants of the Master Servicer and
                                            the Company.

                  (a) The Master Servicer hereby represents and warrants to and
covenants with the Company and the Trustee for the benefit of Certificateholders
that:

                        (i) The Master Servicer is, and throughout the term
         hereof shall remain, a corporation duly organized, validly existing and
         in good standing under the laws of the state of its incorporation
         (except as otherwise permitted pursuant to Section 6.02), the Master
         Servicer is, and shall remain, in compliance with the laws of each
         state in which any Mortgaged Property is located to the extent
         necessary to perform its obligations under this Agreement, and the
         Master Servicer is, and shall remain, approved to sell mortgage lto and
         service mortgage loans for Fannie Mae and Freddie Mac;

                       (ii) The execution and delivery of this Agreement by the
         Master Servicer, and the performance and compliance with the terms of
         this Agreement by the Master Servicer, will not violate the Master
         Servicer's articles of incorporation or bylaws or constitute a default
         (or an event which, with notice or lapse of time, or both, would
         constitute


                                       49

<PAGE>



         a default) under, or result in the breach of, any material agreement or
         other instrument to which it is a party or which is applicable to it or
         any of its assets;

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

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

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

                       (vi) No litigation is pending (other than litigation with
         respect to which pleadings or documents have been filed with a court,
         but not served on the Master Servicer) or, the best of the Master
         Servicer's knowledge, threatened against the Master Servicer which
         would prohibit its entering into this Agreement or performing its
         obligations under this Agreement or is likely to affect materially and
         adversely either the ability of the Master Servicer to perform its
         obligations under this Agreement or the financial condition of the
         Master Servicer;

                      (vii) The Master Servicer will comply in all material
         respects in the performance of this Agreement with all reasonable rules
         and requirements of each insurer under each Insurance Policy;

                     (viii) The execution of this Agreement and the performance
         of the Master Servicer's obligations hereunder do not require any
         license, consent or approval of any state or federal court, agency,
         regulatory authority or other governmental body having jurisdiction
         over the Master Servicer, other than such as have been obtained;

                       (ix) No information, certificate of an officer, statement
         furnished in writing or report delivered to the Company, any affiliate
         of the Company or the Trustee by the Master Servicer in its capacity as
         Master Servicer, and not in its capacity as a Seller


                                       50

<PAGE>



         hereunder, will, to the knowledge of the Master Servicer, contain any
         untrue statement of a material fact; and

                        (x) The Master Servicer will not waive any Prepayment
         Charge unless it is waived in accordance with the standard set forth in
         Section 3.01.

                  It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.03(a) shall survive the
execution and delivery of this Agreement, and shall inure to the benefit of the
Company, the Trustee and the Certificateholders. Upon discovery by the Company,
the Trustee or the Master Servicer of a breach of any of the foregoing
representations, warranties and covenants that materially and adversely affects
the interests of the Company or the Trustee, the party discovering such breach
shall give prompt written notice to the other parties. Notwithstanding the
foregoing, within 90 days of the earlier of discovery by the Master Servicer or
receipt of notice by the Master Servicer of the breach of the covenant of the
Master Servicer set forth in Section 2.03(x) above which materially and
adversely affects the interests of the Holders of the Class P Certificates in
any Prepayment Charge, the Master Servicer shall remedy such breach as follows:
the Master Servicer shall pay the amount of such waived Prepayment Charge, for
the benefit of the holders of the Class P Certificates, by depositing such
amount into the Custodial Account (net of any amount actually collected by the
Master Servicer in respect of such Prepayment Charge and remitted by the Master
Servicer, for the benefit of the Holders of the Class P Certificates, in respect
of such Prepayment Charge, into the Custodial Account). The foregoing shall not,
however, limit any remedies available to the Certificateholders, the Company or
the Trustee on behalf of the Certificateholders, pursuant to the Mortgage Loan
Purchase Agreement respecting a breach of any of the representations, warranties
and covenants contained in the Mortgage Loan Purchase Agreement.

                  (b) The Company hereby represents and warrants to the Master
Servicer and the Trustee for the benefit of Certificateholders that as of the
Closing Date, the representations and warranties of the Seller with respect to
the Mortgage Loans and the remedies therefor that are contained in the Mortgage
Loan Purchase Agreement are as set forth in Exhibit I hereto.

                  It is understood and agreed that the representations and
warranties set forth in this Section 2.03(b) shall survive delivery of the
respective Mortgage Files to the Trustee.

                  Upon discovery by either the Company, the Master Servicer or
the Trustee of a breach of any representation or warranty set forth in this
Section 2.03 which materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach shall
give prompt written notice to the other parties.

                  SECTION 2.04.             Representations and Warranties of
                                            the Seller.

                  The Company hereby assigns to the Trustee for the benefit of
Certificateholders all of its rights (but none of its obligations) in, to and
under the Mortgage Loan Purchase Agreement. Insofar as the Mortgage Loan
Purchase Agreement relates to such representations and warranties and


                                       51

<PAGE>



any remedies provided thereunder for any breach of such representations and
warranties, such right, title and interest may be enforced by the Trustee on
behalf of the Certificateholders. Upon the discovery by the Company, the Master
Servicer or the Trustee of a breach of any of the representations and warranties
made in the Mortgage Loan Purchase Agreement in respect of any Mortgage Loan
which materially and adversely affects the interests of the Certificateholders
in such Mortgage Loan, the party discovering such breach shall give prompt
written notice to the other parties. The Trustee shall promptly notify the
Seller of such breach and request that the Seller shall, within 90 days from the
date that the Seller was notified or otherwise obtained knowledge of such
breach, either (i) cure such breach in all material respects or (ii) purchase
such Mortgage Loan from the Trust Fund at the Purchase Price and in the manner
set forth in Section 2.02; provided that if such breach would cause the Mortgage
Loan to be other than a "qualified mortgage" as defined in Section 860G(a)(3) of
the Code, any such cure or repurchase must occur within 90 days from the date
such breach was discovered. However, in the case of a breach under the Mortgage
Loan Purchase Agreement, subject to the approval of the Company, the Seller
shall have the option to substitute a Qualified Substitute Mortgage Loan or
Loans for such Mortgage Loan if such substitution occurs within two years
following the Closing Date, except that if the breach would cause the Mortgage
Loan to be other than a "qualified mortgage" as defined in Section 860G(a)(3) of
the Code, any such substitution must occur within 90 days from the date the
breach was discovered if such 90 day period expires before two years following
the Closing Date. In the event that the Seller elects to substitute a Qualified
Substitute Mortgage Loan or Loans for a Deleted Mortgage Loan pursuant to this
Section 2.04, the Trustee shall enforce the obligation of the Seller under the
Mortgage Loan Purchase Agreement to deliver to the Trustee and the Master
Servicer, as appropriate, with respect to such Qualified Substitute Mortgage
Loan or Loans, the original Mortgage Note, the Mortgage, an Assignment of the
Mortgage in recordable form, and such other documents and agreements as are
required by Section 2.01, with the Mortgage Note endorsed as required by Section
2.01. No substitution will be made in any calendar month after the Determination
Date for such month. Monthly Payments due with respect to Qualified Substitute
Mortgage Loans in the month of substitution, to the extent received by the
Master Servicer or any Sub-Servicer, shall not be part of the Trust Fund and
will be retained by the Master Servicer and remitted by the Master Servicer to
the Seller on the next succeeding Distribution Date. For the month of
substitution, distributions to Certificateholders will include the Monthly
Payment due on a Deleted Mortgage Loan for such month and thereafter the Seller
shall be entitled to retain all amounts received in respect of such Deleted
Mortgage Loan. The Company shall amend or cause to be amended the Mortgage Loan
Schedule for the benefit of the Certificateholders to reflect the removal of
such Deleted Mortgage Loan and the substitution of the Qualified Substitute
Mortgage Loan or Loans and the Company shall deliver the amended Mortgage Loan
Schedule to the Trustee. Upon such substitution, the Qualified Substitute
Mortgage Loan or Loans shall be subject to the terms of this Agreement in all
respects, the Seller shall be deemed to have made the representations and
warranties with respect to the Qualified Substitute Mortgage Loan contained in
the Mortgage Loan Purchase Agreement as of the date of substitution, and the
Company shall be deemed to have made with respect to any Qualified Substitute
Mortgage Loan or Loans, as of the date of substitution, the representations and
warranties set forth in Exhibit I hereof (other than representations (xiv),
(xvi), (xxix) and (xxxiii) through (xli)).



                                       52

<PAGE>



                  In connection with the substitution of one or more Qualified
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the Master
Servicer will determine the amount (the Substitution Adjustment"), if any, by
which the aggregate principal balance of all such Qualified Substitute Mortgage
Loans as of the date of substitution is less than the aggregate Stated Principal
Balance of all such Deleted Mortgage Loans (in each case after application of
the principal portion of the Monthly Payments due in the month of substitution
that are to be distributed to Certificateholders in the month of substitution).
The Trustee shall enforce the obligation of the Seller under the Mortgage Loan
Purchase Agreement to provide the Master Servicer on the day of substitution for
immediate deposit into the Custodial Account the amount of such shortfall,
without any reimbursement therefor. In accordance with the Mortgage Loan
Purchase Agreement, the Seller shall give notice in writing to the Trustee of
such event, which notice shall be accompanied by an Officers' Certificate as to
the calculation of such shortfall and by an Opinion of Counsel to the effect
that such substitution will not cause (a) any federal tax to be imposed on REMIC
1, REMIC 2 or REMIC 3, including without limitation, any federal tax imposed on
"prohibited transactions" under Section 860F(a)(1) of the Code or on
"contributions after the startup date" under Section 860G(d)(1) of the Code or
(b) any portion of REMIC 1, REMIC 2 or REMIC 3 to fail to qualify as a REMIC at
any time that any Certificate is outstanding. The costs of any substitution as
described above, including any related assignments, opinions or other
documentation in connection therewith shall be borne by the Seller.

                  Except as expressly set forth herein neither the Trustee nor
the Master Servicer is under any obligation to discover any breach of the
above-mentioned representations and warranties.
It is understood and agreed that the obligation of the Seller to cure such
breach, purchase or to substitute for such Mortgage Loan as to which such a
breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to Certificateholders or the Trustee on behalf
of Certificateholders.

                  SECTION 2.05.             Issuance of Certificates; Conveyance
                                            of REMIC Regular Interests and
                                            Acceptance of REMIC 2 by the
                                            Trustee.

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

         (b) The Company, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Company in and
to the REMIC 1 Regular Interests for the benefit of the Holders of the REMIC 2
Regular Interests and Holders of the Class R Certificates (as holders of the
Class R-1 Interest). The Trustee acknowledges receipt of the REMIC 1 Regular
Interests (which are


                                       53

<PAGE>



uncertificated) and declares that it holds and will hold the same in trust for
the exclusive use and benefit of the Holders of the REMIC 2 Regular Interests
and Holders of the Class R Certificates (as holders of the Class R-1 Interest).
The interests evidenced by the Class R-2 Interest, together with the Regular
Certificates, constitute the entire beneficial ownership interest in REMIC 2.

         (c) The Company, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Company in and
to the REMIC 2 Regular Interests for the benefit of the holders of the
Certificates. The Trustee acknowledges receipt of the REMIC 2 Regular Interests
(which are uncertificated) and declares that it holds and will hold the same in
trust for the exclusive use and benefit of the holders of the Certificates. The
interests evidenced by the Class R-3 Interest, together with the Regular
Certificates, constitute the entire beneficial ownership interest in REMIC 3.

         (d) In exchange for the REMIC 2 Regular Interests and, concurrently
with the assignment to the Trustee thereof, pursuant to the written request of
the Company executed by an officer of the Company, the Trustee has executed,
authenticated and delivered to or upon the order of the Company, the Regular
Certificates in authorized denominations evidencing (together with the Class R-3
Interest) the entire beneficial ownership interest in REMIC 3.

         (e) Concurrently with (i) the assignment and delivery to the Trustee of
REMIC 1 (including the Residual Interest therein represented by the Class R-1
Interest) and the acceptance by the Trustee thereof, (ii) the assignment and
delivery to the Trustee of REMIC 2 (including the Residual Interest therein
represented by the Class R-2 Interest), and (iii) the assignment and delivery to
the Trustee of REMIC 3 (including the Residual Interest therein represented by
the Class R-3 Interest), and the acceptance by the Trustee thereof, the Trustee,
pursuant to the written request of the Company executed by an officer of the
Company, has executed, authenticated and delivered to or upon the order of the
Company, the Class R Certificates in authorized denominations evidencing the
Class R-1 Interest, the Class R-2 Interest and the Class R-3 Interest.



                                       54

<PAGE>




                                   ARTICLE III

                          ADMINISTRATION AND SERVICING
                                OF THE TRUST FUND

                  SECTION 3.01.             Master Servicer to Act as Master
                                            Servicer.

                  The Master Servicer shall supervise, or take such actions as
are necessary to ensure, the servicing and administration of the Mortgage Loans
and any REO Property in accordance with this Agreement and its normal servicing
practices, which generally shall conform to the standards (i) of the Servicing
Guide, if Impac Funding Corporation is Master Servicer, or (ii) if Impac Funding
Corporation is not the Master Servicer, of an institution prudently servicing
mortgage loans for its own account and shall have full authority to do anything
it reasonably deems appropriate or desirable in connection with such servicing
and administration. To the extent consistent with the foregoing, the Master
Servicer shall waive (or permit a Sub-Servicer to waive) a Prepayment Charge
only under the following circumstances: (i) such waiver is standard and
customary in servicing similar Mortgage Loans and (ii) such waiver would, in the
reasonable judgement of the Master Servicer, maximize recovery of total proceeds
taking into account the value of such Prepayment Charge and the related Mortgage
Loan and, if such waiver is made in connection with a refinancing of the related
Mortgage Loan, such refinancing is related to a default or a reasonably
foreseeable default.

                  The Master Servicer may perform its responsibilities relating
to servicing through other agents or independent contractors, but shall not
thereby be released from any of its responsibilities as hereinafter set forth.
The authority of the Master Servicer, in its capacity as master servicer, and
any Sub-Servicer acting on its behalf, shall include, without limitation, the
power to (i) consult with and advise any Sub-Servicer regarding administration
of a related Mortgage Loan, (ii) approve any recommendation by a Sub-Servicer to
foreclose on a related Mortgage Loan, (iii) supervise the filing and collection
of insurance claims and take or cause to be taken such actions on behalf of the
insured Person thereunder as shall be reasonably necessary to prevent the denial
of coverage thereunder, and (iv) effectuate foreclosure or other conversion of
the ownership of the Mortgaged Property securing a related Mortgage Loan,
including the employment of attorneys, the institution of legal proceedings, the
collection of deficiency judgments, the acceptance of compromise proposals, the
filing of claims under any Insurance Policy and any other matter pertaining to a
delinquent Mortgage Loan. The authority of the Master Servicer shall include, in
addition, the power on behalf of the Certificateholders, the Trustee or any of
them to (i) execute and deliver customary consents or waivers and other
instruments and documents, (ii) consent to transfer of any related Mortgaged
Property and assumptions of the related Mortgage Notes and Security Instruments
(in the manner provided in this Agreement) and (iii) collect any Insurance
Proceeds and Liquidation Proceeds. Without limiting the generality of the
foregoing, the Master Servicer and any Sub-Servicer acting on its behalf may,
and is hereby authorized, and empowered by the Trustee to, execute and deliver,
on behalf of itself, the Certificateholders or the Trustee or any of them, any
instruments of satisfaction, cancellation, partial or full release, discharge
and all other comparable instruments, with respect to the related Mortgage
Loans, the Insurance Policies and the accounts


                                       55

<PAGE>



related thereto, and the Mortgaged Properties. The Master Servicer may exercise
this power in its own name or in the name of a Sub-Servicer.

                  Subject to Section 3.16, the Trustee shall execute, at the
written request of the Master Servicer, and furnish to the Master Servicer and
any Sub-Servicer such documents provided to it by the Master Servicer or any
Sub-Servicer as are necessary or appropriate to enable the Master Servicer or
any Sub-Servicer to carry out their servicing and administrative duties
hereunder, and the Trustee hereby grants to the Master Servicer a power of
attorney to carry out such duties. The Trustee shall not be liable for the
actions of the Master Servicer or any Sub-Servicers under such powers of
attorney.

                  In accordance with the standards of the preceding paragraph,
the Master Servicer shall advance or cause to be advanced funds as necessary for
the purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties, which advances shall be reimbursable in the first instance from
related collections from the Mortgagors pursuant to Section 3.09, and further as
provided in Section 3.11; provided that the Master Servicer shall not be
obligated to make such advance if, in its good faith judgment, the Master
Servicer determines that such advance to be a Nonrecoverable Advance.

                  Notwithstanding anything in this Agreement to the contrary,
the Master Servicer shall not (unless the Mortgagor is in default with respect
to the Mortgage Loan or such default is, in the judgment of the Master Servicer,
reasonably foreseeable) make or permit any modification, waiver or amendment of
any term of any Mortgage Loan that would both (i) effect an exchange or
reissuance of such Mortgage Loan under Section 1001 of the Code (or Treasury
regulations promulgated thereunder) and (ii) cause any of REMIC 1, REMIC 2 or
REMIC 3 to fail to qualify as a REMIC under the Code or the imposition of any
tax on "prohibited transactions" or "contributions" after the startup date under
the REMIC Provisions.

                  The relationship of the Master Servicer (and of any successor
to the Master Servicer under this Agreement) to the Trustee under this Agreement
is intended by the parties to be that of an independent contractor and not that
of a joint venturer, partner or agent.

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

                  (a) The Master Servicer may enter into Sub-Servicing
Agreements with Sub- Servicers for the servicing and administration of the
Mortgage Loans and for the performance of any and all other activities of the
Master Servicer hereunder; provided, however, that such agreements would not
result in a withdrawal or a downgrading by Standard & Poor's of its rating on
any Class of Certificates. Each Sub-Servicer shall be either (i) an institution
the accounts of which are insured by the FDIC or (ii) another entity that
engages in the business of originating or servicing mortgage loans comparable to
the Mortgage Loans, and in either case shall be authorized to transact business
in the state or states in which the related Mortgaged Properties it is to
service are situated, if and to the extent required by applicable law to enable
the Sub-Servicer to perform its obligations hereunder


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<PAGE>



and under the Sub-Servicing Agreement, and in either case shall be a Freddie Mac
or Fannie Mae approved mortgage servicer. Any Sub-Servicing Agreement entered
into by the Master Servicer shall include the provision that such Agreement may
be immediately terminated (x) with cause and without any termination fee by any
Master Servicer hereunder or (y) without cause in which cthe Master Servicer
shall be responsible for any termination fee or penalty resulting therefrom. In
addition, each Sub-Servicing Agreement shall provide for servicing of the
Mortgage Loans consistent with the terms of this Agreement. With the consent of
the Trustee, the Master Servicer and the Sub-Servicers may enter into
Sub-Servicing Agreements and make amendments to the Sub- Servicing Agreements or
enter into different forms of Sub-Servicing Agreements providing for, among
other things, the delegation by the Master Servicer to a Sub-Servicer of
additional duties regarding the administration of the Mortgage Loans; provided,
however, that any such amendments or different forms shall be consistent with
and not violate the provisions of this Agreement, and that no such amendment or
different form shall be made or entered into which could be reasonably expected
to be materially adverse to the interests of the Certificateholders, without the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights. The parties hereto acknowledge that the initial Sub-Servicer shall be
Wendover.

         The Master Servicer has entered into a Sub-Servicing Agreement with
Wendover for the servicing and administration of the Mortgage Loans and may
enter into additional Sub-Servicing Agreements with Sub-Servicers acceptable to
the Trustee for the servicing and administration of certain of the Mortgage
Loans.

                  (b) As part of its servicing activities hereunder, the Master
Servicer, for the benefit of the Trustee and the Certificateholders, shall
enforce the obligations of each Sub-Serv under the related Sub-Servicing
Agreement. Such enforcement, including, without limitation, the legal
prosecution of claims, termination of Sub-Servicing Agreements and the pursuit
of other appropriate remedies, shall be in such form and carried out to such an
extent and at such time as the Master Servicer, in its good faith business
judgment, would require were it the owner of the related Mortgage Loans. The
Master Servicer shall pay the costs of such enforcement at its own expense, but
shall be reimbursed therefor only (i) from a general recovery resulting from
such enforcement only to the extent, if any, that such recovery exceeds all
amounts due in respect of the related Mortgage Loan or (ii) from a specific
recovery of costs, expenses or attorneys' fees against the party against whom
such enforcement is directed.

                  (c) The Master Servicer represents that it has entered into a
contract regarding the sale of sub-servicing rights with respect to the Mortgage
Loans with GMAC and shall transfer the subservicing of such Mortgage Loans from
Wendover to GMAC on or about July 1, 2001. The Trustee hereby consents to such
transfer.

                  (d) The Master Servicer represents that it will cause any
Sub-Servicer to accurately and fully report its borrower credit files to all
three credit repositories in a timely manner.



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                  SECTION 3.03.             Successor Sub-Servicers.

                  The Master Servicer shall be entitled to terminate any
Sub-Servicing Agreement and the rights and obligations of any Sub-Servicer
pursuant to any Sub-Servicing Agreement in accordance with the terms and
conditions of such Sub-Servicing Agreement. In the event of termination of any
Sub-Servicer, all servicing obligations of such Sub-Servicer shall be assumed
simultaneously by the Master Servicer without any act or deed on the part of
such Sub-Servicer or the Master Servicer, and the Master Servicer either shall
service directly the related Mortgage Loans or shall enter into a Sub-Servicing
Agreement with a successor Sub-Servicer which qualifies under Section 3.02.

                  SECTION 3.04.             Liability of the Master Servicer.

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

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

                  Any Sub-Servicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Sub-Servicer
in its capacity as such and not as an originator shall be deemed to be between
the Sub-Servicer and the Master Servicer alone, and the Trustee and
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to the Sub-Servicer
except as set forth in Section 3.06. The Master Servicer (or Sub-Servicer) shall
be liable for the payment of any franchise taxes which may be assessed by the
California Franchise Tax Board in connection with the activities of the Trust
under this Agreement.



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

                  (a) If the Trustee or its designee shall assume the master
servicing oof the Master Servicer in accordance with Section 7.02 below, the
Trustee, to the extent necessary to permit the Trustee to carry out the
provisions of Section 7.02 with respect to the Mortgage Loans, shall succeed to
all of the rights and obligations of the Master Servicer under each of the Sub-
Servicing Agreements. In such event, the Trustee or its designee as the
successor master servicer shall be deemed to have assumed all of the Master
Servicer's rights and obligations therein and to have replaced the Master
Servicer as a party to such Sub-Servicing Agreements to the same extent as if
such Sub-Servicing Agreements had been assigned to the Trustee or its designee
as a successor master servicer, except that the Trustee or its designee as a
successor master servicer shall not be deemed to have assumed any obligations or
liabilities of the Master Servicer arising prior to such assumption (other than
the obligation to make any Advances hereunder) and the Master Servicer shall not
thereby be relieved of any liability or obligations under such Sub-Servicing
Agreements arising prior to such assumption. Nothing in the foregoing shall be
deemed to entitle the Trustee or its designee as a successor master servicer at
any time to receive any portion of the servicing compensation provided under
Section 3.17 except for such portion as the Master Servicer would be entitled to
receive.

                  (b) In the event that the Trustee or its designee as successor
master servicer for the Trustee assumes the servicing obligations of the Master
Servicer under Section 7.02, upon the reasonable request of the Trustee or such
designee as successor master servicer the Master Servicer shall at its own
expense deliver to the Trustee, or at its written request to such designee,
photocopies of all documents, files and records, electronic or otherwise,
relating to the Sub-Servicing Agreements and the related Mortgage Loans or REO
Property then being serviced and an accounting of amounts collected and held by
it, if any, and will otherwise cooperate and use its reasonable efforts to
effect the orderly and efficient transfer of the Sub-Servicing Agreements, or
responsibilities hereunder to the Trustee, or at its written request to such
designee as successor master servicer.

                  SECTION 3.07.             Collection of Certain Mortgage Loan
                                            Payments.

                  (a) The Master Servicer will coordinate and monitor
remittances by Sub-Servi to the Master Servicer with respect to the Mortgage
Loans in accordance with this Agreement.

                  (b) The Master Servicer shall make its reasonable efforts to
collect or cause to be collected all payments required under the terms and
provisions of the Mortgage Loans and shall follow, and use its reasonable
efforts to cause Sub-Servicers to follow, collection procedures comparable to
the collection procedures of prudent mortgage lenders servicing mortgage loans
for their own account to the extent such procedures shall be consistent with
this Agreement. Consistent with the foregoing, the Master Servicer may in its
discretion (i) waive or permit to be waived any late payment charge, prepayment
charge, assumption fee, or any penalty interest in connection with the
prepayment of a Mortgage Loan and (ii) suspend or reduce or permit to be
suspended or reduced regular monthly payments for a period of up to six months,
or arrange or permit an arrangement with


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<PAGE>



a Mortgagor for a scheduled liquidation of delinquencies. In the event the
Master Servicer shall consent to the deferment of the due dates for payments due
on a Mortgage Note, the Master Servicer shall nonetheless make an Advance or
shall cause the related Sub-Servicer to make an advance to the same extent as if
such installment were due, owing and delinquent and had not been deferred
through liquidation of the Mortgaged Property; provided, however, that the
obligation of the Master Servicer or related Sub-Servicer to make an Advance
shall apply only to the extent that the Master Servicer believes, in good faith,
that such advances are not Nonrecoverable Advances.

                  (c) On each Determination Date, with respect to each Mortgage
Loan for which during the related Prepayment Period the Master Servicer has
determined that all amounts which it expects to recover from or on account of
each such Mortgage Loan have been recovered and that no further Liquidation
Proceeds will be received in connection therewith, the Master Servicer shall
provide to the Trustee a certificate of a Servicing Officer that such Mortgage
Loan became a Liquidated Mortgage Loan in a Cash Liquidation or REO Disposition.

                  The Master Servicer shall make reasonable efforts to collect
all payments called for under the terms and provisions of the Mortgage Loans,
and shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Insurance Policy, follow such
collection procedures as it would follow with respect to mortgage loans
comparable to the Mortgage Loans and held for its own account. The Master
Servicer shall not be required to institute or join in litigation with respect
to collection of any payment (whether under a Mortgage, Mortgage Note, Primary
Hazard Insurance Policy or otherwise or against any public or governmental
authority with respect to a taking or condemnation) if it reasonably believes
that it is prohibited by applicable law from enforcing the provision of the
Mortgage or other instrument pursuant to which such payment is required. The
Master Servicer shall be responsible for preparing and distributing all
information statements relating to payments on the Mortgage Loans, in accordance
with all applicable federal and state tax laws and regulations.

                  SECTION 3.08.             Sub-Servicing Accounts.

                  In those cases where a Sub-Servicer is servicing a Mortgage
Loan pursuant to a Sub- Servicing Agreement, the Sub-Servicer will be required
to establish and maintain one or more accounts (collectively, the "Sub-Servicing
Account"). The Sub-Servicing Account shall be an Eligible Account and shall
otherwise be acceptable to the Master Servicer. All amounts held in a
Sub-Servicing Account shall be held in trust for the Trustee for the benefit of
the Certificateholders. Any investment of funds held in such an account shall be
in Permitted Investments maturing not later than the Business Day immediately
preceding the next Sub-Servicer Remittance Date. The Sub- Servicer will be
required to deposit into the Sub-Servicing Account no later than the first
Business Day after receipt all proceeds of Mortgage Loans received by the
Sub-Servicer, less its servicing compensation and any unreimbursed expenses and
advances, to the extent permitted by the Sub- Servicing Agreement. On each
Sub-Servicer Remittance Date the Sub-Servicer will be required to remit to the
Master Servicer for deposit in the Custodial Account all funds held in the
Sub-Servi Account with respect to any Mortgage Loan as of the Sub-Servicer
Remittance Date, after deducting from such remittance an amount equal to the
servicing compensation (including interest on Permitted


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Investments) and unreimbursed expenses and advances to which it is then entitled
pursuant to the related Sub-Servicing Agreement, to the extent not previously
paid to or retained by it. In addition, on each Sub-Servicer Remittance Date the
Sub-Servicer will be required to remit to the Master Servicer any amounts
required to be advanced pursuant to the related Sub-Servicing Agreement. The
Sub-Servicer will also be required to remit to the Master Servicer, within five
Business Days of receipt, the proceeds of any Principal Prepayment made by the
Mortgagor, and, on each Sub-Serv Remittance Date, the amount of any Insurance
Proceeds or Liquidation Proceeds received dthe related Prepayment Period.

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

                  The Master Servicer and the Sub-Servicers shall establish and
maintain one or more accounts (the "Servicing Accounts"), and shall deposit and
retain therein all collections from the Mortgagors (or related advances from
Sub-Servicers) for the payment of taxes, assessments, Primary Hazard Insurance
Policy premiums, and comparable items for the account of the Mortgagors, to the
extent that the Master Servicer customarily escrows for such amounts.
Withdrawals of amounts so collected from a Servicing Account may be made only to
(i) effect payment of taxes, assessments, Primary Hazard Insurance Policy
premiums and comparable items; (ii) reimburse the Master Servicer (or a
Sub-Servicer to the extent provided in the related Sub-Servicing Agreement) out
of related collections for any payments made pursuant to Sections 3.01 (with
respect to taxes and assessments), and 3.13 (with respect to Primary Hazard
Insurance Policies); (iii) refund to Mortgagors any sums as may be determined to
be overages; or (iv) clear and terminate the Servicing Account at the
termination of this Agreement pursuant to Section 9.01. As part of its servicing
duties, the Master Servicer or Sub-Servicers shall, if and to the extent
required by law, pay to the Mortgagors interest on funds in Servicing Accounts
from its or their own funds, without any reimbursement therefor.

                  SECTION 3.10.             Custodial Account.

                  (a) The Master Servicer shall establish and maintain one or
more accounts (collectively, the "Custodial Account") in which the Master
Servicer shall deposit or cause to be deposited on a daily basis, or as and when
received from the Sub-Servicers, the following payments and collections received
or made by or on behalf of it subsequent to the Cut-off Date, or received by it
prior to the Cut-off Date but allocable to a period subsequent thereto (other
than in respect of principal and interest on the Mortgage Loans due on or before
the Cut-off Date):

                (i) all payments (including advances by a Sub-Servicer) on
         account of principal, including Principal Prepayments, on the Mortgage
         Loans and all Prepayment Charges collected on the Mortgage Loans (and
         any Master Servicer Prepayment Charge Payment Amounts paid by, or
         collected on behalf of the Trust Fund by, the Master Servicer or any
         Sub-Servicer);



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               (ii) all payments (including advances by a Sub-Servicer) on
         account of interest on the Mortgage Loans, including Buydown Funds, if
         any, net of any portion thereof retained by the Master Servicer as
         Master Servicing Fees or any Sub-Servicer as Sub-Servicing Fees;

              (iii) all Insurance Proceeds, other than proceeds that represent
         reimbursement of costs and expenses incurred by the Master Servicer or
         any Sub-Servicer in connection with presenting claims under the related
         Insurance Policies, Liquidation Proceeds and REO Proceeds;

               (iv) all proceeds of any Mortgage Loan or REO Property
         repurchased or purchased in accordance with Sections 2.02, 2.04, 3.14
         or 9.01; and all amounts required to be deposited in connection with
         the substitution of a Qualified Substitute Mortgage Loan pursuant to
         Section 2.04; and

                (v) any amounts required to be deposited pursuant to Section
         3.12, 3.13, 3.15 or 3.22.

                  The foregoing requirements for deposit in the Custodial
Account shall be exclusive. In the event the Master Servicer shall deposit in
the Custodial Account any amount not required to be deposited therein, it may
withdraw such amount from the Custodial Account, any provision herein to the
contrary notwithstanding. The Custodial Account shall be maintained as a
segregated account, separate and apart from trust funds created for mortgage
pass-through certificates of other series, and the other accounts of the Master
Servicer.

                  (b) Funds in the Custodial Account may be invested in
Permitted Investments in accordance with the provisions set forth in Section
3.12. The Master Servicer shall give notice to the Trustee and the Company of
the location of the Custodial Account after any change thereof.

                  SECTION 3.11.             Permitted Withdrawals From the
                                            Custodial Account.

                  The Master Servicer may, from time to time as provided herein,
make withdrawals from the Custodial Account of amounts on deposit therein
pursuant to Section 3.10 that are attributable to the Mortgage Loans for the
following purposes:

                         (i) to make deposits into the Certificate Account in
         the amounts and in the manner provided for in Section 4.01;

                        (ii) to pay to itself, the Company, the Seller or any
         other appropriate person, as the case may be, with respect to each
         Mortgage Loan that has previously been purchased or repurchased
         pursuant to Sections 2.02, 2.04, 3.14 or 9.01 all amounts received
         thereon and not yet distributed as of the date of purchase or
         repurchase;

                         (iii) to reimburse itself or any Sub-Servicer for
         Advances not previously reimbursed, the Master Servicer's or any
         Sub-Servicer's right to reimbursement pursuant to


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         this clause (iii) being limited to amounts received which represent
         Late Collections (net of the related Master Servicing Fees and
         Sub-Servicing Fees) of Monthly Payments on Mortgage Loans with respect
         to which such Advances were made and as further pin Section 3.15;

                        (iv) to reimburse or pay itself, the Trustee or the
         Company for expenses incurred by or reimbursable to the Master
         Servicer, the Trustee or the Company pursuant to Sections 3.22, 6.03,
         8.05 or 10.01(g), except as otherwise provided in such Sections hereof;

                         (v) to reimburse itself or any Sub-Servicer for costs
         and expenses incurred by or reimbursable to it relating to the
         prosecution of any claims pursuant to Section 3.13 that are in excess
         of the amounts so recovered;

                        (vi) to reimburse itself or any Sub-Servicer for unpaid
         Master Servicing Fees, Sub-Servicing Fees and unreimbursed Servicing
         Advances, the Master Servicer's or any Sub-Servicer's right to
         reimbursement pursuant to this clause (vi) with respect to any Mortgage
         Loan being limited to late recoveries of the payments for which such
         advances were made pursuant to Section 3.01 or Section 3.09 and any
         other related Late Collections;

                       (vii) to pay itself as servicing compensation (in
         addition to the Master Servicing Fee and Sub-Servicing Fee), on or
         after each Distribution Date, any interest or investment income earned
         on funds deposited in the Custodial Account for the period ending on
         such Distribution Date;

                      (viii) to reimburse itself or any Sub-Servicer for any
         Advance or Servicing Advance previously made, after a Realized Loss has
         been allocated with respect to the related Mortgage Loan if the Advance
         or Servicing Advance was not reimbursed pursuant to clauses (iii) and
         (vi);

                         (ix) to pay Radian the premium under the Radian
         Lender-Paid PMI Policy; and

                         (x) to clear and terminate the Custodial Account at the
         termination of this Agreement pursuant to Section 9.01.

                  The Master Servicer shall keep and maintain separate
accounting records on a Mortgage Loan by Mortgage Loan basis, for the purpose of
justifying any withdrawal from the Custodial Account pursuant to such subclauses
(ii) through (x).

                  SECTION 3.12.             Permitted Investments.

                  Any institution maintaining the Custodial Account shall at the
direction of the Master Servicer invest the funds in such account in Permitted
Investments, each of which shall mature not later than (i) the Business Day
immediately preceding the date on which such funds are required to


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be withdrawn from such account pursuant to this Agreement, if a Person other
than the Trustee is the obligor thereon, and (ii) no later than the date on
which such funds are required to be withdrawn from such account pursuant to this
Agreement, if the Trustee is the obligor thereon and shall not be sold or
disposed of prior to its maturity. All income and gain realized from any such
investment as well as any interest earned on deposits in the Custodial Account
shall be for the benefit of the Master Servicer. The Master Servicer shall
deposit in the Custodial Account an amount equal to the amount of any loss
incurred in respect of any such investment immediately upon realization of such
loss without right of reimbursement.

                  SECTION 3.13.             Maintenance of Primary Hazard
                                            Insurance.

                  (a) The Master Servicer shall cause to be maintained for each
Mortgage Loan primary hazard insurance by a Qualified Insurer or other insurer
satisfactory to the Rating Agencies with extended coverage on the related
Mortgaged Property in an amount equal to the lesser of (i) 100% of the
replacement value of the improvements, as determined by the insurance company,
on such Mortgaged Property or (ii) the unpaid principal balance of the Mortgage
Loan. The Master Servicer shall also cause to be maintained on property acquired
upon foreclosure, or deed in lieu of foreclosure, of any Mortgage Loan, fire
insurance with extended coverage in an amount equal to the replacement value of
the improvements thereon. Any costs incurred in maintaining any insurance
described in this Section 3.13 (other than any deductible described in the last
paragraph hereof) shall be recoverable as a Servicing Advance. The Master
Servicer shall not be obligated to advance any amounts pursuant to this Section
3.13 if, in its good faith judgment, the Master Servicer determines that such
advance would be a Nonrecoverable Advance. Pursuant to Section 3.10, any amounts
collected by the Master Servicer under any such policies (other than amounts to
be applied to the restoration or repair of the related Mortgaged Property or
property thus acquired or amounts released to the Mortgagor in accordance with
the Master Servicer's normal servicing procedures) shall be deposited in the
Custodial Account, subject to withdrawal pursuant to Section 3.11. Any cost
incurred by the Master Servicer in maintaining any such insurance shall not, for
the purpose of calculating monthly distributions to Certificateholders, be added
to the amount owing under the Mortgage Loan, notwithstanding that the terms of
the Mortgage Loan so permit. It is uand agreed that no earthquake or other
additional insurance is to be required of any Mortgagor or maintained on
property acquired in respect of a Mortgage Loan other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance.

                  The Master Servicer shall, or shall cause the related
Sub-Servicer to, exercise its best reasonable efforts to maintain and keep in
full force and effect each Primary Insurance Policy by a Qualified Insurer, or
other insurer satisfactory to the Rating Agencies, with respect to each first
lien Mortgage Loan as to which as of the Cut-Off Date such a Primary Insurance
Policy was in effect (or, in the case of a Qualified Substitute Mortgage Loan,
the date of substitution) and the original principal amount of the related
Mortgage Note exceeded 80% of the Collateral Value in an amount at least equal
to the excess of such original principal amount over 75% of such Collateral
Value until the principal amount of any such first lien Mortgage Loan is reduced
below 80% of the Collateral Value or, based upon a new appraisal, the principal
amount of such first lien Mortgage Loan


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<PAGE>



represents less than 80% of the new appraised value. The Master Servicer shall,
or shall cause the related Sub-Servicer to, effect the timely payment of the
premium on each Primary Insurance Policy. The Master Servicer and the related
Sub-Servicer shall have the power to substitute for any Primary Insurance Policy
another substantially equivalent policy issued by another Qualified Insurer,
provided, that, such substitution shall be subject to the condition that it will
not cause the ratings on the Certificates to be downgraded or withdrawn, as
evidenced in writing from each Rating Agency.

          The Master Servicer shall cooperate with Radian and shall use its best
efforts to furnish all reasonable aid, evidence and information in the
possession of the Master Servicer or to which the Master Servicer has access
with respect to any Radian Insured Loan.

         In the event of a default by Radian under the Radian Lender-Paid PMI
Policy (a "Replacement Event"), the Master Servicer shall use its best efforts
to obtain a substitute lend primary mortgage insurance policy (a "Substitute PMI
Policy"); PROVIDED, HOWEVER, that the Master Servicer shall not be obligated,
and shall have no liability for failing, to obtain a Substitute PMI Policy
unless such Substitute PMI Policy can be obtained on the following terms and
c(i) the Certificates shall be rated no lower than the rating assigned by each
Rating Agency to the Certificates immediately prior to such Replacement Event,
as evidenced by a letter from each Rating Agency addressed to the Company, the
Master Servicer and the Trustee, (ii) the timing and mechanism for drawing on
such new Substitute PMI Policy shall be reasonably acceptable to the Master
Servicer and the Trustee and (iii) the premiums under the proposed Substitute
PMI Policy shall not exceed such premiums under the existing Radian Lender-Paid
PMI Policy.

         With respect to the Radian PMI Insured Loans covered by a Radian
Lender-Paid PMI Policy, the Master Servicer will confirm with Radian, and Radian
will certify to the Trustee, on or before April 15, 2001, that the Mortgage
Loans indicated on the Mortgage Loan Schedule as being covered by Radian
Lender-Paid PMI Policy are so covered.

         No earthquake or other additional insurance is to be required of any
Mortgagor or maintained on property acquired with respect to a security
instrument other than pursuant to such applicable laws and regulations as shall
at any time be in force and shall require such additional insurance. When, at
the time of origination of the Mortgage Loan or at any subsequent time, the
Mortgaged Property is located in a federally designated special flood hazard
area, the Master Servicer shall cause with respect to the Mortgage Loans and
each REO Property flood insurance (to the extent available and in accordance
with mortgage servicing industry practice) to be maintained. Such flood
insurance shall cover the Mortgaged Property, including all items taken into
account in arriving at the Collateral Value on which the Mortgage Loan was
based, and shall be in an amount equal to the lesser of (i) the Stated Principal
Balance of the related Mortgage Loan and (ii) the minimum amount required under
the terms of coverage to compensate for any damage or loss on a replacement cost
basis, but not more than the maximum amount of such insurance available for the
related Mortgaged Property under either the regular or emergency programs of the
National Flood Insurance Program (assuming that the area in which such Mortgaged
Property is located is participating in such program). Unless applicable state
law requires a higher deductible, the deductible on such flood insurance may not
exceed $1,000 or 1% of the applicable amount of coverage, whichever is less.


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                  In the event that the Master Servicer shall obtain and
maintain a blanket fire insurance policy with extended coverage insuring against
hazard losses on all of the Mortgage Loans, it shall conclusively be deemed to
have satisfied its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case the Master Servicer shall, in the event that
there shall not have been maintained on the related Mortgaged Property a policy
complying with the first two sentences of this Section 3.13 and there shall have
been a loss which would have been covered by such policy, deposit in the
Certificate Account from its own funds the amount not otherwise payable under
the blanket policy because of such deductible clause. Any such deposit by the
Master Servicer shall be made on the Certificate Account Deposit Date next
preceding the Distribution Date which occurs in the month fthe month in which
payments under any such policy would have been deposited in the Custodial
Account. Any such deposit shall not be deemed Servicing Advances and the Master
Servicer shall not be entitled to reimbursement therefor. In connection with its
activities as administrator and servicer of the Mortgage Loans, the Master
Servicer agrees to present, on behalf of itself, the Trustee and
Certificateholders, claims under any such blanket policy.

                  SECTION 3.14.             Enforcement of Due-on-Sale Clauses;
                                            Assumption Agreements.

                  The Master Servicer will, to the extent it has knowledge of
any conveyance or prospective conveyance by any Mortgagor of the Mortgaged
Property (whether by absolute conveyance or by contract of sale, and whether or
not the Mortgagor remains or is to remain liable under the Mortgage Note or the
Mortgage), exercise or cause to be exercised its rights to accelerate the
maturity of such Mortgage Loan under any "due-on-sale" clause applicable
thereto; provided, however, that the Master Servicer shall not exercise any such
rights if it reasonably believes that it is prohibited by law from doing so. The
Master Servicer or the related Sub-Servicer may repurchase a Mortgage Loan at
the Purchase Price deposited into the Custodial Account when the Master Servicer
requires acceleration of the Mortgage Loan, but only if the Master Servicer is
satisfied, as evidenced by an Officer's Certificate delivered to the Trustee,
that either (i) such Mortgage Lis in default or default is reasonably
foreseeable or (ii) if such Mortgage Loan is not in default or default is not
reasonably foreseeable, such repurchase will have no adverse tax consequences
for the Trust Fund or any Certificateholder. If the Master Servicer is unable to
enforce such "due" clause (as provided in the second preceding sentence) or if
no "due-on-sale" clause is applicable, the Master Servicer or the Sub-Servicer
is authorized to enter into an assumption and modification agreement with the
Person to whom such property has been conveyed or is proposed to be conveyed,
pursuant to which such Person becomes liable under the Mortgage Note and, to the
extent permitted by applicable state law, the Mortgagor remains liable thereon;
provided, however, that the Master Servicer shall not enter into any assumption
and modification agreement if the coverage provided under the Primary Insurance
Policy, if any, would be impaired by doing so. The Master Servicer shall notify
the Trustee, whenever possible, before the completion of such assumption
agreement, and shall forward to the Trustee the original copy of such assumption
agreement, which copy shall be added by the Trustee to the related Mortgage File
and which shall, for all purposes, be considered a part of such Mortgage File to
the same extent as all other documents and instruments constituting a part
thereof. In connection with any such assumption agreement, the interest rate on
the related


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Mortgage Loan shall not be changed and no other material alterations in the
Mortgage Loan shall be made unless such material alteration would not cause any
of REMIC 1, REMIC 2 or REMIC 3 to fail to qualify as a REMIC for federal income
tax purposes, as evidenced by an Opinion of Counsel. The Master Servicer is also
authorized to enter into a substitution of liability agreement with such Person,
pursuant to which the original Mortgagor is released from liability and such
Person is substituted as the Mortgagor and becomes liable under the Mortgage
Note. Any fee collected by or on behalf of the Master Servicer for entering into
an assumption or substitution of liability agreement will be retained by or on
behalf of the Master Servicer as additional servicing compensation. In
connection with any such assumption, no material term of the Mortgage Note
(including but not limited to the Mortgage Rate, the amount of the Monthly
Payment and any other term affecting the amount or timing of payment on the
Mortgage Loan) may be changed. The Master Servicer shall not enter into any
substitution or assumption if such substitution or assumption shall (i) both
constitute a "significant modification" effecting an exchange or reissuance of
such Mortgage Loan under the Code (or Treasury regulations promulgated
thereunder) and cause any of REMIC 1, REMIC 2 or REMIC 3 to fail to qualify as a
REMIC under the REMIC Provisions or (ii) cause the imposition of any tax on
"prohibited transactions" or "contributions" after the Startup Day under the
REMIC Provisions. The Master Servicer shall notify the Trustee that any such
substitution or assumption agreement has been completed by forwarding to the
Trustee the original copy of such substitution or assumption agreement, which
copy shall be added to the related Mortgage File and shall, for all purposes, be
considered a part of such Mortgage File to the same extent as all other
documents and instruments constituting a part thereof. A portion equal to up to
2% of the Collateral Value of the related Mortgage Loan, of any fee or
additional interest collected by the related S Servicer for consenting in any
such conveyance or entering into any such assumption agreement may be retained
by the related Sub-Servicer as additional servicing compensation.

                  Notwithstanding the foregoing paragraph or any other provision
of this Agreement, the Master Servicer shall not be deemed to be in default,
breach or any other violation of its obligations hereunder by reason of any
assumption of a Mortgage Loan by operation of law or any assumption that the
Master Servicer may be restricted by law from preventing, for any reason
whatsoever. For purposes of this Section 3.14, the term "assumption" is deemed
to also include a sale of a Mortgaged Property that is not accompanied by an
assumption or substitution of liability agreement.

                  SECTION 3.15.             Realization Upon Defaulted Mortgage
                                            Loans.

                  The Master Servicer shall exercise reasonable efforts,
consistent with the procedures that the Master Servicer would use in servicing
loans for its own account, to foreclose upon or otherwise comparably convert
(which may include an REO Acquisition) the ownership of properties securing such
of the Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments
pursuant to Section 3.07, and which are not released from the Trust Fund
pursuant to any other provision hereof. The Master Servicer shall use reasonable
efforts to realize proceeds from such defaulted Mortgage Loans in such manner
(including short sales) as will maximize the receipt of principal and interest
by Certificateholders, taking into account, among other things, the timing of
foreclosure proceedings.


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The foregoing is subject to the provisions that, in any case in which Mortgaged
Property shall have suffered damage from an Uninsured Cause, the Master Servicer
shall not be required to expend its own funds toward the restoration of such
property unless it shall determine in its sole discretion (i) that such
restoration will increase the net proceeds of liquidation of the related
Mortgage Loan to Certificateholders after reimbursement to itself for such
expenses, and (ii) that such expenses will be recoverable by the Master Servicer
through Insurance Proceeds or Liquidation Proceeds from the related Mortgaged
Property, as contemplated in Section 3.11. The Master Servicer shall be
responsible for all other costs and expenses incurred by it in any such
proceedings; provided, however, that it shall be entitled to reimbursement
thereof from the related property, as contemplated in Section 3.11.

                  The proceeds of any Cash Liquidation or REO Disposition, as
well as any recovery resulting from a partial collection of Insurance Proceeds
or Liquidation Proceeds or any income from an REO Property, will be deposited
into the Custodial Account and applied in the following order of priority:
first, to reimburse the Master Servicer or any Sub-Servicer for any related
unreimbursed Servicing Advances, pursuant to Section 3.11(vi) or 3.22; second,
to accrued and unpaid interest on the Mortgage Loan or REO Imputed Interest, at
the Mortgage Rate, to the date of the Cash Liquidation or REO Disposition, or to
the Due Date prior to the Distribution Date on which such amounts are to be
distributed if not in connection with a Cash Liquidation or REO Disposition; and
third, as a recovery of principal of the Mortgage Loan. If the amount of the
recovery so allocated to interest is less than a full recovery thereof, that
amount will be allocated as follows: first, to unpaid Master Servicing Fees and
Sub-Servicing Fees; and second, to interest at the Net Mortgage Rate. The
portion of the recovery so allocated to unpaid Master Servicing Fees and
Sub-Servi Fees shall be reimbursed to the Master Servicer or any Sub-Servicer
pursuant to Section 3 The portions of the recovery so allocated to interest at
the Net Mortgage Rate and to principal of the Mortgage Loan shall be applied as
follows: first, to reimburse the Master Servicer or any Sub- Servicer for any
related unreimbursed Advances in accordance with Section 3.11(iii) or 3.22,
second, payment to Radian in accordance with Sections 3.11(ix) and third, for
payment to the Trustee and distribution to the Certificateholders in accordance
with the provisions of Section 4.01, subject to Section 3.22 with respect to
certain recoveries from an REO Disposition constituting Excess Proceeds.

                  SECTION 3.16.             Trustee to Cooperate; Release of
                                            Mortgage Files.

                  Upon the payment in full of any Mortgage Loan, or the receipt
by the Master Servicer of a notification that payment in full shall be escrowed
in a manner customary for such pthe Master Servicer will immediately notify the
Trustee by a certification (which certification shall include a statement to the
effect that all amounts received or to be received in connection with such
payment which are required to be deposited in the Custodial Account pursuant to
Section 3.10 have been or will be so deposited) of a Servicing Officer and shall
request delivery to it of the Mortgage File in the form of the Request for
Release attached hereto as Exhibit F-2. Upon receipt of such certification and
request, the Trustee shall promptly release the related Mortgage File to the
Master Servicer. Subject to the receipt by the Master Servicer of the proceeds
of such payment in full and the payment of all related fees and expenses, the
Master Servicer shall arrange for the release to the


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Mortgagor of the original canceled Mortgage Note. All other documents in the
Mortgage File shall be retained by the Master Servicer to the extent required by
applicable law. The Master Servicer shall provide for preparation of the
appropriate instrument of satisfaction covering any Mortgage Loan which pays in
full and the Trustee shall cooperate in the execution and return of such
instrument to provide for its delivery or recording as may be required. No
expenses incurred in connection with any instrument of satisfaction or deed of
reconveyance shall be chargeable to the Custodial Account or the Certificate
Account.

                  From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any insurance policy relating to the Mortgage Loan, the Trustee shall, upon
request of the Master Servicer and delivery to the Trustee of a Request for
Release in the form attached hereto as Exhibit F-1, release the related Mortgage
File to the Master Servicer and the Trustee shall execute such documents as the
Master Servicer shall prepare and request as being necessary to the prosecution
of any such proceedings. Such Request for Release shall obligate the Master
Servicer to return each document previously requested from the Mortgage File to
the Trustee when the need therefor by the Master Servicer no longer exists; and
in any event within 21 days of the Master Servicer's receipt thereof, unless the
Mortgage Loan has been liquidated and the Liquidation Proceeds relating to the
Mortgage Loan have been deposited in the Custodial Account or the Mortgage File
or such document has been delivered to an attorney, or to a public trustee or
other public official as required by law, for purposes of initiating or pursuing
legal action or other proceedings for the foreclosure of the Mortgaged Property
either judicially or n judicially, and the Master Servicer has delivered to the
Trustee a certificate of a Servicing Officer certifying as to the name and
address of the Person to which such Mortgage File or such document was delivered
and the purpose or purposes of such delivery. Upon receipt of a Request for
Release stating that such Mortgage Loan was liquidated and that all amounts
received or to be received in connection with such liquidation which are
required to be deposited into the Custodial Account have been or will be so
deposited, or that such Mortgage Loan has become an REO Property, a copy of the
Request for Release shall be released by the Trustee to the Master Servicer.

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

                  SECTION 3.17.             Servicing Compensation.



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                  As compensation for its activities hereunder, the Master
Servicer shall be entitled to withhold and retain, from deposits to the
Custodial Account of amounts representing payments or recoveries of interest,
the Master Servicing Fees with respect to each Mortgage Loan (less any portion
of such amounts retained by any Sub-Servicer). In addition, the Master Servicer
shall be entitled to recover unpaid Master Servicing Fees out of related Late
Collections to the extent permitted in Section 3.11.

                  Each Sub-Servicing Agreement shall permit the related
Sub-Servicer to retain the Sub-Servicing Fees from collections on the related
Mortgage Loans, or shall provide that the S Servicer be paid directly by the
Master Servicer from collections on the related Mortgage Loans. To the extent
the Master Servicer directly services a Mortgage Loan, the Master Servicer shall
be entitled to retain the Sub-Servicing Fees for that Mortgage Loan.

                  The Master Servicer also shall be entitled pursuant to Section
3.11 to receive from the Custodial Account as additional servicing compensation
interest or other income earned on deposits therein, subject to Section 3.23, as
well as any assumption fees, late payment charges and reconveyance fees. The
Master Servicer shall not be entitled to retain any Prepayment Charges. The
Master Servicer shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder (including payment of the
premiums for any blanket policy insuring against hazard losses pursuant to
Section 3.13 and servicing compensation of the Sub-Servicer to the extent not
retained by it), and shall not be entitled to reimbursement therefor except as
specifically provided in Section 3.11. The Master Servicing Fee may not be
transferred in whole or in part except in connection with the transfer of all of
the Master Servicer's responsibilities and obligations under this Agreement.

                  SECTION 3.18.             Maintenance of Certain Servicing
                                            Policies.

         The Master Servicer shall obtain and maintain at its own expense and
shall cause each Sub- Servicer to obtain and maintain for the duration of this
Agreement a blanket fidelity bond and an errors and omissions insurance policy
covering the Master Servicer's and such Sub-Servicer's officers, employees and
other persons acting on its behalf in connection with its activities under this
Agreement. The amount of coverage shall be at least equal to the coverage
maintained by the Master Servicer or Sub-Servicer in order to be acceptable to
Fannie Mae or Freddie Mac to service loans for it or otherwise in an amount as
is commercially available at a cost that is generally not regarded as excessive
by industry standards. The Master Servicer shall promptly notify the Trustee in
writing of any material change in the terms of such bond or policy. The Master
Servicer shall provide annually to the Trustee a certificate of insurance that
such bond and policy are in effect. If any such bond or policy ceases to be in
effect, the Master Servicer shall, to the extent possible, give the Trustee ten
days' notice prior to any such cessation and shall use its reasonable best
efforts to obtain a comparable replacement bond or policy, as the case may be.



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                  SECTION 3.19.             Annual Statement as to Compliance.

                  Within 120 days after December 31 of each year, commencing
December 2001, the Master Servicer at its own expense shall deliver to the
Trustee, with a copy to the Rating Agencies, a certificate signed by a Servicing
Officer stating, as to the signers thereof, that (i) a review of the activities
of the Master Servicer during the preceding calendar year and of performance
under this Agreement has been made under such officers' supervision, (ii) to the
best of such officers' knowledge, based on such review, the Master Servicer has
fulfilled all its obligations under this Agreement for such year, or, if there
has been a default in the fulfillment of any such obligation, specifying each
such default known to such officer and the nature and status thereof including
the steps being taken by the Master Servicer to remedy such default; (iii) a
review of the activities of each Sub-Servicer during the Sub-Servicer's most
recently ended fiscal year on or prior to such December 31 and its performance
under its Sub-Servicing Agreement has been made under such officer's
supervision; and (iv) to the best of the Servicing Officer's knowledge, based on
his review and the certification of an officer of the Sub-Servicer (unless the
Servicing Officer has reason to believe that reliance on such certification is
not justified), either each Sub-Servicer has performed and fulfilled its duties,
responsibilities and obligations under this Agreement and its Sub-Servi
Agreement in all material respects throughout the year, or, if there has been a
default in performance or fulfillment of any such duties, responsibilities or
obligations, specifying the nature and status of each such default known to the
Servicing Officer. Copies of such statements shall be provided by the Master
Servicer to the Certificateholders upon request or by the Trustee at the expense
of the Master Servicer should the Master Servicer fail to provide such copies.

                  SECTION 3.20.             Annual Independent Public
                                            Accountants' Servicing Statement.

                  (a) Within 120 days after December 31 of each year, commencing
December 2001, the Master Servicer, at its expense, shall cause a firm of
independent public accountants who are members of the American Institute of
Certified Public Accountants to furnish a statement to the Master Servicer,
which will be provided to the Trustee and the Rating Agencies, to the effect
that, in connection with the firm's examination of the Master Servicer's
financial statements as of the end of such calendar year, nothing came to their
attention that indicated that the Master Servicer was not in compliance with the
provisions of this Agreement except for (i) such exceptions as such firm
believes to be immaterial and (ii) such other exceptions as are set forth in
such statement.

                  (b) Within 120 days after December 31 of each year, commencing
December 2001, the Master Servicer, at its expense, shall or shall cause each
Sub-Servicer to cause a nationally recognized firm of independent certified
public accountants to furnish to the Master Servicer or such Sub-Servicer a
report stating that (i) it has obtained a letter of representation regarding
certain matters from the management of the Master Servicer or such Sub-Servicer
which includes an assertion that the Master Servicer or such Sub-Servicer has
complied with certain minimum mortgage loan servicing standards (to the extent
applicable to commercial and multifamily mortgage loans) identified in the
Uniform Single Attestation Program for Mortgage Bankers established by the
Mortgage Bankers Association of America with respect to the servicing of first
and second lien


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conventional single family mortgage loans during the most recently completed
calendar year a(ii) on the basis of an examination conducted by such firm in
accordance with standards established by the American Institute of Certified
Public Accountants, such representation is fairly stated in all material
respects, subject to such exceptions and other qualifications that may be
appropriate. Immediately upon receipt of such report, the Master Servicer shall
or shall cause each Sub-Serv to furnish a copy of such report to the Trustee and
the Rating Agencies.

                  SECTION 3.21.             Access to Certain Documentation.

                  The Master Servicer shall provide, and shall cause any
Sub-Servicer to provide, to the Trustee, access to the documentation in their
possession regarding the related Mortgage Loans and REO Properties and to the
Certificateholders, the FDIC, and the supervisory agents and examiners of the
FDIC (to which the Trustee shall also provide) access to the documentation
regarding the related Mortgage Loans required by applicable regulations, such
access being afforded without charge but only upon reasonable request and during
normal business hours at the offices of the Master Servicer or the Sub-Servicers
that are designated by these entities; provided, however, that, unless otherwise
required by law, the Trustee, the Master Servicer or the Sub-Servicer shall not
be required to provide access to such documentation if the provision thereof
would violate the legal right to privacy of any Mortgagor; provided, further,
however, that the Trustee shall coordinate its requests for such access so as
not to impose an unreasonable burden on, or cause an unreasonable interruption
of, the business of the Master Servicer or any Sub-Servicer. The Master
Servicer, the Sub-Servicers and the Trustee shall allow representatives of the
above entities to photocopy any of the documentation and shall provide equipment
for that purpose at a charge that covers their own actual out-of-pocket costs.

                  SECTION 3.22.             Title, Conservation and Disposition
                                            of REO Property.

                  This Section shall apply only to REO Properties acquired for
the account of REMIC 1 and shall not apply to any REO Property relating to a
Mortgage Loan which was purchased or repurchased from REMIC 1 pursuant to
Sections 2.02, 2.04 or 3.14. In the event that title to any such REO Property is
acquired, the deed or certificate of sale shall be issued to the Trustee, or to
its nominee, on behalf of the Certificateholders. The Master Servicer, on behalf
of REMIC 1, shall either sell any REO Property before the close of the third
taxable year following the taxable year in which REMIC 1 acquires ownership of
such REO Property for purposes of Section 860G(a)(8) of the Code or, at the
expense of REMIC 1, request, more than 60 days before the day on which the
three-year grace period would otherwise expire an extension of the three-year
grace period, unless the Master Servicer has delivered to the Trustee an Opinion
of Counsel (which shall not be at the expense of the Trustee), addressed to the
Trustee and the Master Servicer, to the effect that the holding by REMIC 1 of
such REO Property subsequent to the close of the third taxable year following
the taxable year in which REMIC 1 acquires ownership of such REO Property will
not result in the imposition on REMIC 1 of taxes on "prohibited transactions"
thereof, as defined in Section 860F of the Code, or cause any of REMIC 1, REMIC
2 or REMIC 3 to fail to qualify as a REMIC under the REMIC Provisions or
comparable provisions of the laws of the State of California at any time that
any Certificates are outstanding. The Master Servicer shall manage, conserve,


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protect and operate each REO Property for the Certificateholders solely for the
purpose of its prompt disposition and sale in a manner which does not cause such
REO Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) or result in the receipt by any of REMIC 1, REMIC 2 or REMIC
3 of any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code or any "net income from foreclosure property" which is
subject to taxation under the REMIC Provisions. Pursuant to its efforts to sell
such REO Property, the Master Servicer shall either itself or through an agent
selected by the Master Servicer protect and conserve such REO Property in the
same manner and to such extent as is customary in the locality where such REO
Property is located and may, incident to its conservation and protection of the
interests of the Certificateholders, rent the same, or any part thereof, as the
Master Servicer deems to be in the best interest of the Certificateholders for
the period prior to the sale of such REO Property.

                  Any REO Disposition shall be for cash only (unless changes in
the REMIC Provisions made subsequent to the Startup Day allow a sale for other
consideration).

                  The Master Servicer shall segregate and hold all funds
collected and received in connection with the operation of any REO Property
separate and apart from its own funds and general assets. The Master Servicer
shall deposit, or cause to be deposited, on a daily basis in the Custodial
Account all revenues received with respect to the REO Properties, net of any
directly related expenses incurred or withdraw therefrom funds necessary for the
proper operation, management and maintenance of the REO Property.

                  If as of the date of acquisition of title to any REO Property
there remain outstanding unreimbursed Servicing Advances with respect to such
REO Property or any outstanding Advances allocated thereto the Master Servicer,
upon an REO Disposition, shall be entitled to reimbursement for any related
unreimbursed Servicing Advances and any unreimbursed related Advances as well as
any unpaid Master Servicing Fees and Sub-Servicing Fees from proceeds received
in connection with the REO Disposition, as further provided in Section 3.15. The
Master Servicer shall not be obligated to advance any amounts with respect to an
REO Property if, in its good faith jthe Master Servicer determines that such
advance would constitute a Nonrecoverable Advance.

                  The REO Disposition shall be carried out by the Master
Servicer at such price and upon such terms and conditions as the Master Servicer
shall determine.

                  The Master Servicer shall deposit the proceeds from the REO
Disposition, net of any payment to the Master Servicer as provided above, in the
Custodial Account upon receipt thereof for distribution in accordance with
Section 4.01; provided, that any such net proceeds received by the Master
Servicer which are in excess of the applicable Stated Principal Balance plus all
unpaid REO Imputed Interest thereon through the last day of the month in which
the REO Disposition occurred ("Excess Proceeds") shall be retained by the Master
Servicer as additional servicing compensation.



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                  With respect to any Mortgage Loan as to which the Master
Servicer has received notice of, or has actual knowledge of, the presence of any
toxic or hazardous substance on the Mortgaged Property, the Master Servicer
shall not, on behalf of the Trustee, either (i) obtain title to the related
Mortgaged Property as a result of or in lieu of foreclosure or otherwise, or
(ii) otherwise acquire possession of, the related Mortgaged Property, unless the
Master Servicer has, at least 30 days prior to taking such action, obtained and
delivered to the Trustee an environmental audit report prepared by a Person who
regularly conducts environmental audits using customary industry standards. The
Master Servicer shall take such action as it deems to be in the best economic
interest of the Trust Fund (other than proceeding against the Mortgaged
Property) and is hereby authorized at such time as it deems appropriate to
release such Mortgaged Property from the lien of the related Mortgage.

                  The cost of the environmental audit report contemplated by
this Section 3.22 shall be advanced by the Master Servicer as an expense of the
Trust Fund, and the Master Servicer shall be reimbursed therefor from the
Custodial Account as provided in Section 3.11, any such right of reimbursement
being prior to the rights of the Certificateholders to receive any amount in the
Custodial Account.

                  If the Master Servicer determines, as described above, that it
is in the best economic interest of the Trust Fund to take such actions as are
necessary to bring any such Mortgaged Property in compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged Property, then
the Master Servicer shall take such action as it deems to be in the best
economic interest of the Trust Fund. The cost of any such compliance,
containment, clean-up or remediation shall be advanced by the Master Servicer as
an expense of the Trust Fund, and the Master Servicer shall be entitled to be
reimbursed therefor from the Custodial Account as provided in Section 3.11, any
such right of reimbursement being prior to the rights of the Certificateholders
to receive any amount in the Custodial Account.

                  SECTION 3.23.             Additional Obligations of the Master
                                            Servicer.

                  On each Certificate Account Deposit Date, the Master Servicer
shall deliver to the Trustee for deposit in the Certificate Account from its own
funds and without any right of reimbursement therefor, a total amount equal to
the amount of Compensating Interest for the related Distribution Date.

                  SECTION 3.24              [Reserved].

                  SECTION 3.25.             Additional Obligations of the
                                            Company.

                  The Company agrees that on or prior to the tenth day after the
Closing Date, the Company shall provide the Trustee with a written notification,
substantially in the form of Exhibit J attached hereto, relating to each Class
of Certificates, setting forth (i) in the case of each Class of such
Certificates, (a) if less than 10% of the aggregate Certificate Principal
Balance or Notional


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Amount of such Class of Certificates has been sold as of such date, the value
calculated pto clause (b)(iii) of Exhibit J hereto, or, (b) if 10% or more of
such Class of Certificates has been sold as of such date but no single price is
paid for at least 10% of the aggregate Certificate Principal Balance or Notional
Amount of such Class of Certificates, then the weighted average price at which
the Certificates of such Class were sold and the aggregate percentage of
Certificates of such Class sold, (c) the first single price at which at least
10% of the aggregate Certificate Principal Bor Notional Amount of such Class of
Certificates was sold, or (d) if any Certificates of each Class of Certificates
are retained by the Company or an affiliate corporation, or are delivered to the
Seller, the fair market value of such Certificates as of the Closing Date, (ii)
the Prepayment Assumption used in pricing the Certificates, and (iii) such other
information as to matters of fact as the Trustee may reasonably request to
enable it to comply with its reporting requirements with respect to each Class
of such Certificates to the extent such information can in the good faith
judgment of the Company be determined by it.

                  SECTION 3.26.             Periodic Filings with the Securities
                                            and Exchange Commission; Additional
                                            Information.

                  The Trustee shall prepare or cause to be prepared for filing
with the Commission any and all reports, statements and information respecting
the Trust Fund and/or the Certificates required to be filed with the Commission
pursuant to the Securities Exchange Act of 1934, as amended, and shall solicit
any and all proxies of the Certificateholders whenever such proxies are required
to be solicited, pursuant to the Securities Exchange Act of 1934, as amended.
The Company shall promptly file, and exercise its reasonable best efforts to
obtain a favorable response to, no-action requests with, or other appropriate
exemptive relief from, the Commission seeking the usual and customary exemption
from such reporting requirements granted to issuers of securities similar to the
Certificates. Fees and expenses incurred by the Trustee in connection with this
Section shall not be reimbursable from the Trust Fund.

                  The Master Servicer and the Company each agree to promptly
furnish to the Trustee, from time to time upon request, such further
information, reports and financial statements within their respective control
related to this Agreement and the Mortgage Loans as the Trustee reasonably deems
appropriate to prepare and file all necessary reports with the Commission.

                  SECTION 3.27.             Administration of Buydown Funds.

                  (a) With respect to any Buydown Mortgage Loan, the
Sub-Servicer has deposited Buydown Funds in an account that satisfies the
requirements for a Sub-Servicing Account (the "Buydown Account"). The Master
Servicer shall cause the Sub-Servicing Agreement to require that upon receipt
from the Mortgagor of the amount due on a Due Date for each Buydown Mortgage
Loan, the Sub-Servicer will withdraw from the Buydown Account the predetermined
amount that, when added to the amount due on such date from the Mortgagor,
equals the full Monthly Payment and transmit that amount in accordance with the
terms of the Sub-Servicing Agreement to the Master Servicer together with the
related payment made by the Mortgagor or advanced by the Sub-Servi



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                  (b) If the Mortgagor on a Buydown Mortgage Loan prepays such
loan in its entirety during the period (the "Buydown Period") when Buydown Funds
are required to be applied to such Buydown Mortgage Loan, the Sub-Servicer shall
be required to withdraw from the Buydown Account and remit any Buydown Funds
remaining in the Buydown Account in accordance with the related buydown
agreement. The amount of Buydown Funds which may be remitted in accordance with
the related buydown agreement may reduce the amount required to be paid by the
Mortgagor to fully prepay the related Mortgage Loan. If the Mortgagor on a
Buydown Mortgage Loan defaults on such Mortgage Loan during the Buydown Period
and the property securing such Buydown Mortgage Loan is sold in the liquidation
thereof (either by the Master Servicer or the insurer under any related Primary
Insurance Policy), the Sub-Servicer shall be required to withdraw from the
Buydown Account the Buydown Funds for such Buydown Mortgage Loan still held in
the Buydown Account and remit the same to the Master Servicer in accordance with
the terms of the Sub-Servi Agreement for deposit in the Custodial Account or, if
instructed by the Master Servicer, pay to the insurer under any related Primary
Insurance Policy if the Mortgaged Property is transferred to such insurer and
such insurer pays all of the loss incurred in respect of such default. Any
amount so remitted pursuant to the preceding sentence will be deemed to reduce
the amount owed on the Mortgage Loan.


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                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS


                  SECTION 4.01.             Distributions.

                  (a) The Trustee shall establish and maintain a Certificate
Account, in which the Master Servicer shall cause to be deposited on behalf of
the Trustee on or before 5:00 P.M. New York time on each Certificate Account
Deposit Date by wire transfer of immediately available funds an amount equal to
the sum of (i) any Advance for the immediately succeeding Distribution Date,
(ii) any amount required to be deposited in the Certificate Account pursuant to
Sections 3.11, 3.13, 3.22 or 3.23, (iii) all other amounts constituting the
Available Distribution Amount for the immediately succeeding Distribution Date
and (iv) any amounts on deposit in the Custodial Account representing Prepayment
Charges collected by the Master Servicer (and any Master Servicer Prepayment
Charge Payment Amounts paid by, or collected on behalf of the Trust Fund by, the
Master Servicer or any Sub-Servicer), other than any such Prepayment Charges or
Master Servicer Prepayment Charge Payment Amounts relating to Principal
Prepayments that occurred after the end of the related Prepayment Period.

                  On each Distribution Date, prior to making any other
distributions referred to in Section 4.01, the Trustee shall withdraw from the
Certificate Account and pay itself the Trustee's Fee for such Distribution Date.

                  On each Distribution Date the Trustee shall distribute to each
Certificateholder of record as of the next preceding Record Date (other than as
provided in Section 9.01 respecting the final distribution) either in
immediately available funds (by wire transfer or otherwise) to the account of
such Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder has so notified the Trustee at least 5
Business Days prior to the related Record Date, or otherwise by check mailed to
such Certificateholder at the address of such Holder appearing in the
Certificate Register, such Certificateholder's share (based on the aggregate of
the Percentage Interests represented by Certificates of the applicable Class
held by such Holder) of the amounts required to be distributed to such Holder
pursuant to this Section 4.01.

                  On each Distribution Date, the Trustee shall withdraw from the
Certificate Account that portion of Available Distribution Amount for such
Distribution Date consisting of the Interest Remittance Amount for such
Distribution Date, and make the following disbursements and transfers in the
order of priority described below, in each case to the extent of the Interest
Remittance Amount remaining for such Distribution Date:

                  (i) to the Holders of the Class A-IO Certificates, the related
         Monthly Interest Distributable Amount for each such Class for such
         Distribution Date;



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                  (ii) to the Holders of the Class A-IO Certificates, the
         related Unpaid Interest Shortfall Amount, if any, for each such Class
         for such Distribution Date;

                  (iii) (a) from the remaining Interest Remittance Amount in
         respect of the Group 1 Loans, to the Holders of the Class A-1
         Certificates, the related Monthly Interest Distributable Amount for
         such Class for such Distribution Date, and (b) from the remaining
         Interest Remittance Amount in respect of the Group 2 Loans, to the
         Holders of the Class A-2 Certificates, the related Monthly Interest
         Distributable Amount for such Class for such Distribution Date;

                  (iv) (a) from the remaining Interest Remittance Amount in
         respect of the Group 1 Loans, to the Holders of the Class A-1
         Certificates, the related Unpaid Interest Shortfall for such Class for
         such Distribution Date, and (b) from the remaining Interest Remittance
         Amount in respect of the Group 2 Loans, to the Holders of the Class A-2
         Certificates, the related Unpaid Interest Shortfall for such Class for
         such Distribution Date;

                  (v) (a) from the remaining Interest Remittance Amount in
         respect of the Group 1 Loans, to the Holders of the Class A-2
         Certificates, any remaining Unpaid Interest Shortfall for such Class
         for such Distribution Date, and (b) from the remaining Interest
         Remittance Amount in respect of the Group 2 Loans, to the Holders of
         the Class A-1 Certificates, any remaining Unpaid Interest Shortfall for
         such Class for such Distribution Date;

                  (vi) to the Holders of the Class M-1 Certificates, the Monthly
         Interest Distributable Amount for such Class for such Distribution
         Date;

                  (vii) to the Holders of the Class M-2 Certificates, the
         Monthly Interest Distributable Amount for such Class for such
         Distribution Date; and

                  (viii) to the Holders of the Class B Certificates, the Monthly
         Interest Distributable Amount for such Class for such Distribution
         Date.

                  (b) On each Distribution Date (x) prior to the Stepdown Date
or (y) on which a Trigger Event is in effect, the Trustee shall withdraw from
the Certificate Account an amount equal to the Principal Distribution Amount and
distribute to the Certificateholders the following amounts, in the following
order of priority, in each case to the extent of the Principal Distribution
Amount remaining for such Distribution Date:

                  (i) to the holders of the Class A-1 Certificates and Class A-2
         Certificates, on a pro rata basis, based on the Principal Remittance
         Amount for such Distribution Date from the Group 1 Loans and Group 2
         Loans, respectively, until the Certificate Principal Balances thereof
         have been reduced to zero; provided that if on such Distribution Date
         either of the Class A Certificates is no longer outstanding, the
         Principal Remittance Amount for such Distribution Date will be
         allocated to the remaining Class A Certificates;



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                  (ii) to the holders of the Class M-1 Certificates, until the
         Certificate Principal Balance thereof has been reduced to zero;

                  (iii) to the holders of the Class M-2 Certificates, until the
         Certificate Principal Balance thereof has been reduced to zero; and

                  (iv) to the holders of the Class B Certificates, until the
         Certificate Principal Balance thereof has been reduced to zero.

                  (c) On each Distribution Date (x) on or after the Stepdown
Date and (y) on which a Trigger Event is not in effect, the Trustee shall
withdraw from the Certificate Account an amount equal to the Principal
Distribution Amount and distribute to the Certificateholders the following
amounts, in the following order of priority, in each case to the extent of the
Principal Distribution Amount remaining for such Distribution Date:

                  (i) from the Class A Principal Distribution Amount, to the
         holders of the Class A-1 Certificates and Class A-2 Certificates, on a
         pro rata basis, based on the Principal Remittance Amount for such
         Distribution Date from the Group 1 Loans and Group 2 Loans,
         respectively, until the Certificate Principal Balances thereof have
         been reduced to zero; provided that if on such Distribution Date either
         of the Class A Certificates is no longer outstanding, the Class A
         Principal Distribution Amount for such Distribution Date will be
         allocated to the remaining Class A Certificates;

                  (ii) to the holders of the Class M-1 Certificates, the Class
         M-1 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero;

                  (iii) to the holders of the Class M-2 Certificates, the Class
         M-2 Principal Distribution Amount until the Certificate Principal
         Balance thereof has been reduced to zero; and

                  (iv) to the holders of the Class B Certificates, the Class B
         Principal Distribution Amount until the Certificate Principal Balance
         thereof has been reduced to zero.

                  (d) On each Distribution Date, the Net Monthly Excess Cashflow
shall be distributed in the following order of priority, in each case to the
extent of the Net Monthly Excess Cashflow remaining for such Distribution Date:

                  (i) to the Holders of the Class or Classes of Certificates
         then entitled to receive distributions in respect of principal, in an
         amount equal to any Extra Principal Distribution Amount, payable to
         such Holders as part of the Principal Distribution Amount as described
         under Section 4.01(b) or Section 4.01(c) above, as applicable;

                  (ii) to the Holders of the Class M-1 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;


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                  (iii) to the Holders of the Class M-1 Certificates, in an
         amount equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (iv) to the Holders of the Class M-2 Certificates, in an
         amount equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (v) to the Holders of the Class M-2 Certificates, in an amount
         equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (vi) to the Holders of the Class B Certificates, in an amount
         equal to the Unpaid Interest Shortfall Amount allocable to such
         Certificates;

                  (vii) to the Holders of the Class B Certificates, in an amount
         equal to the Allocated Realized Loss Amount allocable to such
         Certificates;

                  (viii) to the Holders of the Class C Certificates, interest
         equal to the Monthly Interest Distributable Amount for such Class and
         principal equal to any remaining Overcollateralization Release Amount
         for such Distribution Date;

                  (ix) if such Distribution Date follows the Prepayment Period
         during which occurs the latest date on which a Prepayment Charge may be
         required to be paid in respect of any Mortgage Loans, to the Holders of
         the Class P Certificates, in reduction of the Certificate Principal
         Balance thereof, until the Certificate Principal Balance thereof is
         reduced to zero; and

                  (x) any remaining amounts to the Holders of the Class R
         Certificates (in respect of the appropriate Residual Interest).

                  (e) Notwithstanding paragraphs (b) and (c) above, (i) (A) if
on any Distribution Date, the Certificate Principal Balance of the Class A-1
Certificates has been reduced to zero, the Class A Principal Distribution Amount
will be allocated to the Class A-2 Certificates and (B) if on any Distribution
Date, the Certificate Principal Balance of the Class A-2 Certificates has been
reduced to zero, the Class A Principal Distribution Amount will be allocated to
the Class A-1 Certificates and (ii) (A) if on any Distribution Date the portion
of the Principal Distribution Amount allocated to the Class A-1 Certificates
pursuant to clause (i) of paragraph (c) above is insufficient to pay to the
Class A-1 Certificates its pro rata potion of the Class A Principal Distribution
Amount, any Net Monthly Excess Cash Flow not included in the Principal
Distribution Amount for such Distribution Date will be allocated to such class
of Class A Certificates in an amount equal to the lesser of the deficiency and
such amount of Net Monthly Excess Cash Flow, (B) if on any Distribution Date the
portion of the Principal Distribution Amount allocated to the Class A-2
Certificates pursuant to clause (i) of paragraph (c) above is insufficient to
pay to the Class A-2 Certificates its pro rata potion of the Class A Principal
Distribution Amount, the principal to which they are entitled under clause (i)
of the preceding paragraph, any Net Monthly Excess Cash Fnot included in the
Principal Distribution Amount for such Distribution Date will be allocated to
such


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class of Class A Certificates in an amount equal to the lesser of the deficiency
and such amount of such Net Monthly Excess Cash Flow and (C) if both clauses (A)
and (B) are in effect, any such amount of Net Monthly Excess Cash Flow will be
allocated to pay the deficiencies in clauses (A) and (B) on a pro rata basis
based on the Certificates Principal Balances of the Class A Certificates.

                  (f) On each Distribution Date, all amounts representing
Prepayment Charges in respect of the Mortgage Loans received during the related
Prepayment Period and any Master Servicer Prepayment Charge Amounts paid by the
Master Servicer during the related Prepayment Period will be withdrawn from the
Certificate Account and distributed by the Trustee to the Holders of the Class P
Certificates and shall not be available for distribution to the Holders of any
other Class of Certificates. The payment of the foregoing amounts to the Holders
of the Class P Certificates shall not reduce the Certificate Principal Balances
thereof.

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

                  (h) The Trustee, upon the written direction of the Master
Servicer shall invest or cause the institution maintaining the Certificate
Account to invest the funds in the Certificate Account in Permitted Investments
designated in the name of the Trustee for the benefit of the Certificateholders,
which shall mature not later than the Business Day next preceding the
Distribution Date next following the date of such investment and shall not be
sold or disposed of prior to maturity. All income and gain realized from any
such investment prior to the Business Day next preceding the Distribution Date
shall be for the benefit of the Master Servicer. The amount of any losses
incurred in respect of any such investments shall be deposited in the
Certificate Account by the Master Servicer out of its own funds immediately as
realized without any right of reimbursement.

                  (i) Except as otherwise provided in Section 9.01, if the
Master Servicer anticipates that a final distribution with respect to any Class
of Certificates will be made on the next Distribution Date, the Master Servicer
shall, no later than the Determination Date in the month of such final
distribution, notify the Trustee and the Trustee shall, no later than two (2)
Business Days after such Determination Date, mail on such date to each Holder of
such Class of Certificates a notice to the effect that: (i) the Trustee
anticipates that the final distribution with respect to such Class of
Certificates will be made on such Distribution Date but only upon presentation
and surrender of such Certificates at the office of the Trustee or as otherwise
specified therein, and (ii) no interest shall accrue on such Certificates from
and after the end of the prior calendar month.



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                  Any funds not distributed to any Holder or Holders of
Certificates of such Class on such Distribution Date because of the failure of
such Holder or Holders to tender their Certificates shall, on such date, be set
aside and held in trust and credited to the account of the appropriate non-
tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.01(i) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within six months after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Trustee shall take reasonable steps as directed by the
Company, or appoint an agent to take reasonable steps, to contact the remaining
non-tende Certificateholders concerning surrender of their Certificates. The
costs and expenses of maintaining the funds in trust and of contacting such
Certificateholders shall be paid out of the assets remaining in the Trust Fund.
If within nine months after the second notice any such Certificates shall not
have been surrendered for cancellation, the Class R Certificateholders shall be
entitled to all unclaimed funds and other assets which remain subject hereto. No
interest shall accrue or be payable to any Certificateholder on any amount held
in trust as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with this Section
4.01(i).

                  SECTION 4.02.             Statements to Certificateholders.

                  (a) On each Distribution Date, based, as applicable, on
information provided to it by the Master Servicer, the Trustee shall prepare and
make available on the Trustee's website,
http://www-apps.gis.deutsche-bank.com/invr (or deliver at the recipient's
option), to each Holder of the Regular Certificates, the Master Servicer and the
Rating Agencies, a statement as to the distributions made on such Distribution
Date:

                  (i) (A) the amount of the distribution made on such
         Distribution Date to the Holders of each Class of Regular Certificates
         (other than the Class A-IO Certificates), separately identified,
         allocable to principal and (B) the amount of the distribution made on
         such Distribution Date to the Holders of the Class P Certificates
         allocable to Prepayment Charges and Master Servicer Prepayment Charge
         Payment Amounts;

                  (ii) the amount of the distribution made on such Distribution
         Date to the Holders of each Class of Regular Certificates (other than
         the Class P Certificates) allocable to interest, separately identified;

                  (iii) the Pass-Through Rate on each Class of Regular
         Certificates (other than the Class P Certificates) for such
         Distribution Date;

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

                  (v) the number and aggregate Stated Principal Balance of the
         Mortgage Las of the end of the related Due Period;



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                  (vi) the Overcollateralized Amount, the Excess
         Overcollateralized Amount, the Overcollateralization Release Amount,
         the Overcollateralization Deficiency Amount and the
         Overcollateralization Target Amount for such Distribution Date;

                  (vii) the aggregate Certificate Principal Balance or Notional
         Amount, as applicable, of each Class of Regular Certificates after
         giving effect to the amounts distributed on such Distribution Date (in
         the case of each Class of the Mezzanine Certificates, separately
         identifying any reduction thereof due to the allocation of Realized
         Losses thereto);

                  (viii) the number and aggregate Stated Principal Balance of
         Mortgage Loans (a) delinquent 31 to 60 days, (b) delinquent 61 to 90
         days, (c) delinquent 91 days or more, in each case as of the end of the
         calendar month prior to such Distribution Date;

                  (ix) the number, aggregate principal balance and book value of
         any REO Properties as of the close of business on the last day of the
         calendar month preceding the month in which such Distribution Date
         occurs;

                  (x) the weighted average remaining term to maturity, weighted
         average Mortgage Rate and weighted average Net Mortgage Rate of the
         Mortgage Loans as of the close of business on the first day of the
         calendar month in which such Distribution Date occurs;

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

                  (xii) the aggregate amount of Realized Losses incurred during
         the related Prepayment Period and the cumulative amount of Realized
         Losses;

                  (xiii) the aggregate amount of extraordinary Trust Fund
         expenses withdrawn from the Custodial Account or the Certificate
         Account for such Distribution Date;

                  (xiv) the aggregate amount of any Prepayment Interest
         Shortfalls for such Distribution Date, to the extent not covered by
         payments by the Master Servicer pursuant to Section 3.23, and the
         aggregate amount of Relief Act Interest Shortfalls for such
         Distribution Date;

                  (xv) the Monthly Interest Distributable Amount in respect of
         each Class of the Class A Certificates and Mezzanine Certificates for
         such Distribution Date and the Unpaid Interest Shortfall Amount, if
         any, with respect to each Class of the Class A Certificates and
         Mezzanine Certificates for such Distribution Date;

                  (xvi) (A) the Overcollateralization Target Amount, (B) the
         Overcollateralized Amount and (C) the amount, if any, by which the
         Overcollateralization Target Amount exceeds the Overcollateralized
         Amount, in each case after giving effect to the distribution made on
         the Regular Certificates on such Distribution Date;


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                  (xvii) when the Stepdown Date or a Trigger Event has occurred;

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

                  (xix) the Available Distribution Amount for such Distribution
         Date.

                  In the case of information furnished pursuant to subclauses
(i) and (ii) above, the amounts shall also be expressed as a dollar amount per
Single Certificate.

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

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

                  On each Distribution Date the Trustee shall prepare and make
available on the Trustee's website, http://www-apps.gis.deutsche-bank.com/invr
(or deliver at the recipient's option), to each Holder of a Class R Certificate
a copy of the reports forwarded to the other Certificateholders on such
Distribution Date.

                  Within a reasonable period of time after the end of each
calendar year, the Trustee shall prepare and forward, to each Person who at any
time during the calendar year was a Holder of a Class R Certificate a statement
containing the information provided pursuant to the previous paragraph
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Trustee shall be
deemed to have been satisfied tthe extent that substantially comparable
information shall be provided by the Trustee pursuant to any requirements of the
Code as from time to time are in force.

                  SECTION 4.03.             Remittance Reports; Advances by the
                                            Master Servicer.

                  (a) On the Business Day following each Determination Date, the
Master Servicer shall deliver to the Trustee a report, prepared as of the close
of business on the Determination Date (the "Remittance Report"), in the form of
an electromagnetic tape or disk. The Remittance Report and any written
information supplemental thereto shall include such information with respect to
the Mortgage Loans that is required by the Trustee for purposes of making the
calculations and preparing


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the statement described in Sections 4.01 and 4.02, as set forth in written
specifications or guidelines issued by the Trustee from time to time. The
Trustee shall have no obligation to recompute, recalculate or verify any
information provided to it by the Master Servicer.

                  (b) The Master Servicer shall determine the aggregate amount
of Advances required to be made for the related Distribution Date, which shall
be in an aggregate amount equal to the sum of (1) the aggregate amount of
Monthly Payments (with each interest portion thereof adjusted to the Mortgage
Rate less the sum of the Master Servicing Fee Rate, the Sub-Servicing Fee Rate
and any applicable Radian PMI Policy Rate), other than Balloon Payments, less
the aof any related Debt Service Reductions or reductions in the amount of
interest collectable from the Mortgagor pursuant to the Relief Act, on the
Outstanding Mortgage Loans as of the related Due Date, which Monthly Payments
were delinquent as of the close of business as of the related Determination Date
plus (2) with respect to each Balloon Loan delinquent in respect of its Balloon
Payment as of the close of business on the related Determination Date, an amount
equal to the assumed Monthly Payment (net of the related Master Servicing Fees
and Sub-Servicing Fees) that would have been due on the related Due Date based
on the original principal amortization scheduled for such Balloon Loan until
such Balloon Loan is finally liquidated; provided that no Advance shall be made
if it would be a Nonrecoverable Advance. On or before 4:00 P.M. New York time on
each Certificate Account Deposit Date, the Master Servicer shall either (i)
deposit in the Certificate Account from its own funds, or funds received
therefor from the Sub-Servicers, an amount equal to the Advances to be made by
the Master Servicer in respect of the related Distribution Date, (ii) withdraw
from amounts on deposit in the Custodial Account and deposit in the Certificate
Account all or a portion of the amounts held for future distribution in
discharge of any such Advance, or (iii) make advances in the form of any
combination of (i) and (ii) aggregating the amount of such Advance. Any portion
of the amounts held for future distribution so used shall be replaced by the
Master Servicer by deposit in the Certificate Account on or before 1:00 P.M. New
York time on any future Certificate Account Deposit Date to the extent that
funds attributable to the Mortgage Loans that are available in the Custodial
Account for deposit in the Certificate Account on such Certificate Account
Deposit Date shall be less than payments to Certificateholders required to be
made on the following Distribution Date. The amount of any reimbursement
pursuant to Section 3.11 in respect of outstanding Advances on any Distribution
Date shall be allocated to specific Monthly Payments due but delinquent for
previous Due Periods, which allocation shall be made, to the extent practicable,
to Monthly Payments which have been delinquent for the longest period of time.
Such allocations shall be conclusive for purposes of reimbursement to the Master
Servicer from recoveries on related Mortgage Loans pursuant to Section 3.11. The
determination by the Master Servicer that it has made a Nonrecoverable Advance
or that any proposed Advance, if made, would constitute a Nonrecoverable
Advance, shall be evidenced by a certificate of a Servicing Officer delivered to
the Seller and the Trustee with the Remittance Report. The Trustee shall deposit
all funds it receives pursuant to this Section 4.03 into the Certificate
Account.

                  (c) In the event that the Master Servicer determines as of any
Certificate Account Deposit Date that it will be unable to deposit in the
Certificate Account an amount equal to the Advance required to be made for the
immediately succeeding Distribution Date in the amount determined by the Master
Servicer pursuant to paragraph (b) above, it shall give notice to the Trustee


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of its inability to Advance (such notice may be given by telecopy), not later
than 4:00 P.M., New York time, on such date, specifying the portion of such
amount that it will be unable to deposit. Not later than 4:00 P.M., New York
time, on the earlier of (x) two Business Days following such Certificate Account
Deposit Date or (y) the Business Day preceding the related Distribution Date,
unless by such time the Master Servicer shall have directly or indirectly
deposited in the Certificate Account the entire amount of the Advances required
to be made for the related Distribution Date, pursuant to Section 7.01, the
Trustee shall (a) terminate all of the rights and obligations of the Master
Servicer under this Agreement in accordance with Section 7.01 and (b) assume the
rights and obligations of the Master Servicer hereunder, including the
obligation to deposit in the Certificate Account an amount equal to the Advance
for the immediately succeeding Distribution Date.

                  SECTION 4.04.             Distributions on the REMIC Regular
                                            Interests.

                  On each Distribution Date, the Trustee shall cause the
Available Distribution Amount, in the following order of priority, to be
distributed by REMIC 1 to REMIC 2 on account of the REMIC 1 Regular Interests or
withdrawn from the Certificate Account and distributed to the Holders of the
Class R Certificates (in respect of the Class R-1 Interest), as the case may be:

                  (1) first, to the Holders of REMIC 1 Regular Interest LT1D, in
         an amount equal to (A) the Uncertificated Accrued Interest for such
         Distribution Date, plus (B) any amounts in respect thereof remaining
         unpaid from previous Distribution Dates and second, to Holders of REMIC
         1 Regular Interest LT1A, REMIC 1 Regular Interest LT1B, REMIC 1 Regular
         Interest LT1C and REMIC 1 Regular Interest LT1P in an amount equal to
         (A) the Uncertificated Accrued Interest for such Distribution Date,
         plus (B) any amounts in respect thereof remaining unpaid from previous
         Distribution Dates; and

                  (2) second, to the Holders of REMIC 1 Regular Interests, in an
         amount equal to the remainder of the Available Distribution Amount for
         such Distribution Date after the distributions made pursuant to clause
         (1) above, allocated in the following order of priority:

                                    (A) to the Holders of REMIC 1 Regular
                  Interest LT1P, on the Distribution Date immediately following
                  the expiration of the latest Prepayment Charge as identified
                  on the Prepayment Charge Schedule or any Distribution Date
                  thereafter until $100 has been distributed pursuant to this
                  clause (A);

                                    (B) with respect to the Group 1 Loans, to
                  the Holders of REMIC 1 Regular Interest LT1A and REMIC 1
                  Regular Interest LT1B, 99% and 1%, respectively, until the
                  Uncertificated Principal Balance of those REMIC 1 Regular
                  Interests are reduced to zero;

                                    (C) with respect to the Group 2 Loans, to
                  the Holders of REMIC Regular Interest LT1A and REMIC 1 Regular
                  Interest LT1C, 99% and 1%, respectively, until the
                  Uncertificated Principal Balance of those REMIC 1 Regular
                  Interests are reduced to zero;


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                                    (D) to the Holders of REMIC 1 Regular
                  Interest LT1D, until the Uncertificated Principal Balance of
                  REMIC 1 Regular Interest LT1D is reduced to zero; and

                                    (E) any remaining amount to the Holders of
                  the Class R Certificates (in respect of the Class R-1
                  Interest).

                  On each Distribution Date, all amounts representing Prepayment
Charges in respect of the Mortgage Loans received during the related Prepayment
Period and any Master Servicer Prepayment Charge Payment Amounts paid by the
Master Servicer during the related Prepayment Period will be distributed by
REMIC 1 to the Holders of REMIC 1 Regular Interest LT1P. The payment of the
foregoing amounts to the Holders of REMIC 1 Regular Interest LT1P shall not
reduce the Uncertificated Principal Balance thereof.

                  On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 3 on account of the REMIC 2 Regular Interests or withdrawn from the
Distribution Account and distributed to the holders of the Class R Certificates
(in respect of the Class R-2 Interest), as the case may be:

                  (i) first, to the extent of Available Funds, to the Holders of
         REMIC 2 Regular Interest A-IO, in an amount equal to (A) the
         Uncertificated Accrued Interest for such Distribution Date, plus (B)
         any amounts in respect thereof remaining unpaid from previous
         Distribution Dates and then to Holders of REMIC 2 Regular Interest
         LT2A, REMIC 2 Regular Interest LT2B, REMIC 2 Regular Interest LT2C,
         REMIC 2 Regular Interest LT2D, REMIC 2 Regular Interest LT2E, REMIC 2
         Regular Interest LT2F, REMIC 2 Regular Interest LT2G, REMIC 2 Regular
         Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC 2 Regular Interest
         LT2J, REMIC 2 Regular Interest LT2K, REMIC 2 Regular Interest LT2L and
         REMIC 2 Regular Interest LT2P, PRO RATA, in an amount equal to (A) the
         Uncertificated Accrued Interest for such Distribution Date, plus (B)
         any amounts in respect thereof remaining unpaid from previous
         Distribution Dates. Amounts payable as Uncertificated Accrued Interest
         in respect of REMIC 2 Regular Interest LT2F and REMIC 2 Regular
         Interest LT2L shall be reduced when the sum of REMIC 2 Group 1
         Overcollateralized Amount and REMIC 2 Group 2 Overcollateralized Amount
         is less than the REMIC 2 Overcollateralization Target Amount, by the
         lesser of (x) the amount of such difference and (y) the Maximum
         Uncertificated Accrued Interest Deferral Amount, and such amount will
         be payable to the Holders of REMIC 2 Regular Interest LT2B, REMIC 2
         Regular Interest LT2C, REMIC 2 Regular Interest LT2D, REMIC 2 Regular
         Interest LT2E, REMIC 2 Regular Interest LT2H, REMIC 2 Regular Interest
         LT2I, REMIC 2 Regular Interest Land REMIC 2 Regular Interest LT2K in
         the same proportion as the Overcollateralization Increase Amount is
         allocated to the Corresponding Certificates;

                  (ii) second, to the Holders of REMIC 2 Regular Interests, in
         an amount equal to the remainder of the Available Funds for such
         Distribution Date after the distributions made pursuant to clause (i)
         above, allocated as follows:


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                           (a) with respect to the Group 1 Loans, to the Holders
                  of REMIC 2 Regular Interest LT2A, 98.00% of such remainder,
                  until the Uncertificated Principal Balance of such
                  Uncertificated REMIC 2 Regular Interest is reduced to zero,
                  and with respect to the Group 2 Loans, to the Holders of REMIC
                  2 Regular Interest LT2G, 98% of such remainder, until the
                  Uncertificated Principal Balance of such Uncertificated REMIC
                  2 Regular Interest is reduced to zero;

                           (b) with respect to the Group 1 Loans, to the Holders
                  of REMIC 2 Regular Interest LT2B, REMIC 2 Regular Interest
                  LT2C, REMIC 2 Regular Interest LT2D and REMIC 2 Regular
                  Interest LT2E, 1.00% of such remainder, in the same proportion
                  as principal payments are allocated to the Corresponding
                  Certificates, until the Uncertificated Principal Balances of
                  such REMIC 2 Regular Interests are reduced to zero; and with
                  respect to the Group 2 Loans, to the Holders of REMIC 2
                  Regular Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC 2
                  Regular Interest LT2J and REMIC 2 Regular Interest LT2K, 1.00%
                  of such remainder, in the same proportion as principal
                  payments are allocated to the Corresponding Certificates,
                  until the Uncertificated Principal Balances of such REMIC 2
                  Regular Interests are reduced to zero;

                           (c) with respect to the Group 1 Loans, to the Holders
                  of REMIC 2 Regular Interest LT2F, 1.00% of such remainder,
                  until the Uncertificated Principal Balance of such REMIC 2
                  Regular Interest is reduced to zero, and with respect to the
                  Group 2 Loans, to the Holders of REMIC 2 Regular Interest
                  LT2L, 1.00% of such remainder, until the Uncertificated
                  Principal Balance of such REMIC 2 Regular Interest is reduced
                  to zero;

                           (d) to the Holders of REMIC 2 Regular Interest LT2P,
                  on the Distribution Date immediately following the expiration
                  of the latest Prepayment Charge as identified on the
                  Prepayment Charge Schedule or any Distribution Date thereafter
                  until $100 has been distributed pursuant to this clause; then

                           (e) any remaining amount to the Holders of the Class
                  R Certificates (in respect of the Class R-2 Interest); and

                  (iii) third, to REMIC 2 Regular Interest LT2P, 100% of the
         amount paid in respect of Prepayment Charges and Master Servicer
         Prepayment Charge Payment Amounts on REMIC 1 Regular Interest LT1P;

provided, however, that with respect to the Group 1 Loans, 98.00% and 2.00% of
any principal payments that are attributable to an Overcollateralization Release
Amount shall be allocated to Holders of REMIC 2 Regular Interest LT2A and REMIC
2 Regular Interest LT2F, respectively, to the extent the principal balance of
the Group 1 Loans exceeds the sum of the Uncertificated Principal Balances of
REMIC 2 Regular Interest LT2A, REMIC 2 Regular Interest LT2B, REMIC 2 Regular
Interest LT2C, REMIC 2 Regular Interest LT2D, REMIC 2 Regular Interest LT2E and
REMIC 2


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Regular Interest LT2F immediately following payments pursuant to (c) above but
prior to any payments pursuant to this proviso, and with respect to the Group 2
Loans, 98.00% and 2.00% of any principal payments that are attributable to an
Overcollateralization Release Amount shall be allocated to Holders of REMIC 2
Regular Interest LT2F and REMIC 2 Regular Interest LT2L, respectively, to the
extent the principal balance of the Group 2 Loans exceeds the sum of the
Uncertificated Principal Balances of REMIC 2 Regular Interest LT2G, REMIC 2
Regular Interest LT2H, REMIC 2 Regular Interest LT2I, REMIC 2 Regular Interest
LT2J, REMIC 2 Regular Interest LT2K and REMIC 2 Regular Interest LT2L
immediately following payments pursuant to (c) above but prior to any payments
pursuant to this proviso.

                  SECTION 4.05.             Allocation of Realized Losses.

                  (a) All Realized Losses on the Mortgage Loans shall be
allocated by the Trustee on each Distribution Date as follows: first, to Net
Monthly Excess Cashflow; second, to the Class C Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; third, to the
Class B Certificates, until the Certificate Principal Balance thereof has been
reduced to zero; fourth, to the Class M-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; and fifth, to the Class M-1
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero. All Realized Losses to be allocated to the Certificate Principal
Balances of all Classes on any Distribution Date shall be so allocated after the
actual distributions to be made on such date as provided above. All references
above to the Certificate Principal Balance of any Class of Certificates shall be
to the Certificate Principal Balance of such Class immediately prior to the
relevant Distribution Date, before reduction thereof by any Realized Losses, in
each case to be allocated to such Class of Certificates, on such Distribution
Date.

         Any allocation of Realized Losses to a Mezzanine Certificate on any
Distribution Date shall be made by reducing the Certificate Principal Balance
thereof by the amount so allocated. Any allocation of Realized Losses to a Class
C Certificate shall be made by reducing the amount otherwise payable in respect
thereof pursuant to Section 4.01(d)(viii). No allocations of any Realized Losses
shall be made to the Certificate Principal Balances of the Class A Certificates
or the Class P Certificates.

                  (b) All Realized Losses on the Mortgage Loans shall be
allocated by the Trustee on each Distribution Date as follows: with respect to
Realized Losses on the Group 1 Loans, to REMIC 1 Regular Interest LT1A and REMIC
1 Regular Interest LT1B, 99% and 1%, respectively, and with respect to Realized
Losses on the Group 2 Loans, to REMIC 1 Regular Interest LT1A and REMIC 1
Regular Interest LT1C, 99% and 1%, respectively, until the Uncertificated
Principal Balance has been reduced to zero and then to REMIC 1 Regular Interest
LT1D until the Uncertificated Principal Balance has been reduced to zero.

                  (c) All Realized Losses on the REMIC 1 Regular Interest LT1A,
REMIC 1 Regular Interest LT1B, REMIC 1 Regular Interest LT1C and REMIC 1 Regular
Interest LT1D shall be deemed to have been allocated in the specified
percentages, as follows: with respect to Realized Losses on the Group 1 Loans,
first, to Uncertificated Accrued Interest payable to the REMIC 2


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Regular Interest LT2A and REMIC 2 Regular Interest LT2F up to an aggregate
amount equal to the REMIC 2 Group 1 Interest Loss Allocation Amount, 98% and 2%,
respectively; second, to the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2A and REMIC 2 Regular Interest LT2F up to an aggregate
amount equal to the REMIC 2 Group 1 Principal Loss Allocation Amount, 98% and
2%, respectively; third, to the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2A, REMIC 2 Regular Interest LT2E and REMIC 2 Regular
Interest LT2F, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC 2 Regular Interest LT2E has been reduced to zero; fourth, to
the Uncertificated Principal Balances of REMIC 2 Regular Interest LT2A, REMIC 2
Regular Interest LT2D and REMIC 2 Regular Interest LT2F, 98%, 1% and 1%,
respectively, until the Uncertificated Principal Balance of REMIC 2 Regular
Interest LT2D has been reduced to zero; and fifth, to the Uncertificated
Principal Balances of REMIC 2 Regular Interest LT2A, REMIC 2 Regular Interest
LT2C and REMIC 2 Regular Interest LT2F, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2C has been
reduced to zero, and with respect to Realized Losses on the Group 2 Loans,
first, to Uncertificated Accrued Interest payable to the REMIC 2 Regular
Interest LT2G and REMIC 2 Regular Interest LT2L up to an aggregate amount equal
to the REMIC 2 Group 2 Interest Loss Allocation Amount, 98% and 2%,
respectively; second, to the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2G and REMIC 2 Regular Interest LT2L up to an aggregate
amount equal to the REMIC 2 Group 2 Principal Loss Allocation Amount, 98% and
2%, respectively; third, to the Uncertificated Principal Balances of REMIC 2
Regular Interest LT2G, REMIC 2 Regular Interest LT2K and REMIC 2 Regular
Interest LT2L, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC 2 Regular Interest LT2K has been reduced to zero; fourth, to
the Uncertificated Principal Balances of REMIC 2 Regular Interest LT2G, REMIC 2
Regular Interest LT2J and REMIC 2 Regular Interest LT2L, 98%, 1% and 1%,
respectively, until the Uncertificated Principal Balance of REMIC 2 Regular
Interest LT2J has been reduced to zero; and fifth, to the Uncertificated
Principal Balances of REMIC 2 Regular Interest LT2G, REMIC 2 Regular Interest
LT2I and REMIC 2 Regular Interest LT2L, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC 2 Regular Interest LT2I has been
reduced to zero.

                  SECTION 4.06.             Information Reports to Be Filed by
                                            the Master Servicer.

                  The Master Servicer or the Sub-Servicers shall file
information reports with respect to the receipt of mortgage interest received in
a trade or business, foreclosures and abandonments of any Mortgaged Property and
the information returns relating to cancellation of indebtedness income with
respect to any Mortgaged Property required by Sections 6050H, 6050J and 6050P of
the Code, respectively, and deliver to the Trustee an Officers' Certificate
stating that such reports have been filed. Such reports shall be in form and
substance sufficient to meet the reporting requirements imposed by such Sections
6050H, 6050J and 6050P of the Code.

                  SECTION 4.07.             Compliance with Withholding
                                            Requirements.

                  Notwithstanding any other provision of this Agreement, the
Trustee shall comply with all federal withholding requirements respecting
payments to Certificateholders of interest or original issue discount on the
Mortgage Loans, that the Trustee reasonably believes are applicable under the


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Code. The consent of Certificateholders shall not be required for such
withholding. In the event the Trustee withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee shall, together with
its monthly report to such Certificateholders pursuant to Section 4.02 hereof,
indicate such amount withheld.



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                                    ARTICLE V

                                THE CERTIFICATES


                  SECTION 5.01.             The Certificates.

                  (a) The Certificates will be substantially in the respective
forms annexed hereto as Exhibits A, B-1, B-2, B-3 and B-4. The Certificates will
be issuable in registered form only. The Certificates (other than the Class P
Certificates, the Class C Certificates and the Class R Certificates) will be
issued in minimum denominations of $25,000 Initial Certificate Principal Balance
or Initial Notional Amount, as applicable, and integral multiples of $1 in
excess thereof. The Class C Certificates will be issued in minimum denominations
of $10,000 Initial Notional Amount and integral multiples of $1 in excess
thereof. The Class P Certificates and the Class R Certificates will each be
issuable in minimum denominations of any Percentage Interest representing 20.00%
and multiples of 0.01% in excess thereof.

                  Upon original issue, the Certificates shall, upon the written
request of the Company executed by an officer of the Company, be executed and
delivered by the Trustee, authenticated by the Trustee and delivered to or upon
the order of the Company upon receipt by the Trustee of the documents specified
in Section 2.01. The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee in its capacity as trustee hereunder by a
Responsible Officer. Certificates bearing the manual or facsimile signatures of
individuals who were at the time they signed the proper officers of the Trustee
shall bind the Trustee, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the authentication and delivery of
such Certificates or did not hold such offices at the date of such Certificates.
No Certificate shall be entitled to any benefit under this Agreement, or be
valid for any purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the
Trustee by manual signature, and such certificate upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates issued on the Closing
Date shall be dated the Closing Date and any Certificates delivered thereafter
shall be dated the date of their authentication.

                  (b) The Class A Certificates and the Mezzanine Certificates
shall initially be issued as one or more Certificates registered in the name of
the Depository or its nominee and, except as provided below, registration of
such Certificates may not be transferred by the Trustee except to another
Depository that agrees to hold such Certificates for the respective Certificate
Owners with Ownership Interests therein. The Certificate Owners shall hold their
respective Ownership Interests in and to each of such Book-Entry Certificates
through the book-entry facilities of the Depository and, except as provided
below, shall not be entitled to Definitive Certificates in respect of such
Ownership Interests. All transfers by Certificate Owners of their respective
Ownership Interests in the Book-Entry Certificates shall be made in accordance
with the procedures established by the Depository Participant or brokerage firm
representing such Certificate Owner. Each Depository Participant shall transfer
the Ownership Interests only in the Book-Entry


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Certificates of Certificate Owners it represents or of brokerage firms for which
it acts as agent in accordance with the Depository's normal procedures. The
Trustee shall not be required to monitor, determine or inquire as to compliance
with the transfer restrictions with respect to the Book- Certificates, and the
Trustee shall have no liability for transfers of Ownership Interests in the Book
Entry Certificates made through the book-entry facilities of the Depositary or
between or among Depositary Participants or Certificate Owners, made in
violation of the applicable restrictions.

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

                  If (i)(A) the Company advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Company is unable to locate a
qualified successor or (ii) the Company at its option advises the Trustee in
writing that it elects to terminate the book-entry system through the
Depository, the Trustee shall notify all Certificate Owners, through the
Depository, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon sto the
Trustee of the Book-Entry Certificates by the Depository, accompanied by
registration instructions from the Depository for registration of transfer, the
Trustee shall, at the expense of the Company, issue the Definitive Certificates.
Neither the Company, the Master Servicer nor the Trustee shall be liable for any
actions taken by the Depository or its nominee, including, without limitation,
any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates the Trustee and the Master Servicer shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder.

                  (c) Each Certificate is intended to be a "security" governed
by Article 8 of the Uniform Commercial Code as in effect in the State of New
York and any other applicable jurisdiction, to the extent that any of such laws
may be applicable.



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                  SECTION 5.02.             Registration of Transfer and
                                            Exchange of Certificates.

                  (a) The Trustee shall maintain a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided.

                  (b) Except as provided in Section 5.02(c), no transfer, sale,
pledge or other disposition of a Class P Certificate, Class C Certificate or a
Class R Certificate shall be made unless such transfer, sale, pledge or other
disposition is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "Act"), and any applicable state securities laws or is
made in accordance with said Act and laws. In the event that a transfer of a
Class P Certificate, Class C Certificate or Class R Certificate is to be made
under this Section 5.02(b), (i) the Trustee shall require an Opinion of Counsel
acceptable to and in form and substance satisfactory to the Trustee that such
transfer shall be made pursuant to an exemption, describing the applicable
exemption and the basis therefor, from said Act and laws or is being made
pursuant to said Act and laws, which Opinion of Counsel shall not be an expense
of the Trustee, the Company or the Master Servicer, provided that such Opinion
of Counsel will not be required in connection with the initial transfer of any
such Certificate by the Company or any affiliate thereof, to a non-affiliate of
the Company and (ii) the Trustee shall require the transferee to execute a
representation letter, substantially in the form of Exhibit G-1 hereto, and the
Trustee shall require the transferor to execute a representation letter,
substantially in the form of Exhibit G-2 hereto, each acceptable to and in form
and substance satisfactory to the Trustee certifying to the Company and the
Trustee the facts surrounding such transfer, which representation letters shall
not be an expense of the Trustee, the Company or the Master Servicer; provided
however that such representation letters will not be required in connection with
any transfer of any such Certificate by the Company to an affiliate of the
Company and the Trustee shall be entitled to conclusively rely upon a
representation (which, upon the request of the Trustee, shall be a written
representation) from the Company of the status of such transferee as an
affiliate of the Company. Any such Certificateholder desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee, the Company and
the Master Servicer against any liability that may result if the transfer is not
so exempt or is not made in accordance with such applicable federal and state
laws.

                  (c) Notwithstanding the requirements of Section 5.02(b),
transfers of Class P Certificates, Class C Certificates and Class R Certificates
may be made in accordance with this Section 5.02(c) if the prospective
transferee of a Certificate provides the Trustee and the Company with an
investment letter substantially in the form of Exhibit G-3 attached hereto,
which investment letter shall not be an expense of the Trustee, the Company or
the Master Servicer, and which investment letter states that, among other
things, such transferee is a "qualified institutional buyer" as defined under
Rule 144A. Such transfers shall be deemed to have complied with the requirements
of Section 5.02(b) hereof; provided, however, that no Transfer of any of the
Class P Certificates, Class C Certificates or Class R Certificates may be made
pursuant to this Section 5.02(c) by the Company. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Company and the Master Servicer against any liability that may
result


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<PAGE>



if the transfer is not so exempt or is not made in accordance with such
applicable federal and state laws.

                  The Trustee shall require an Opinion of Counsel from a
prospective transferee prior to the transfer of any Class P Certificate, Class C
Certificate or Class R Certificate to any employee benefit plan or other
retirement arrangement, including individual retirement accounts and Keogh
plans, that is subject to Section 406 of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA") or Section 4975 of the Code (any of the
foregoing, a "Plan"), to a trustee or other Person acting on behalf of any Plan,
or to any other person who is using "plan assets" of any Plan to effect such
acquisition (including any insurance company using funds in its general or
separate accounts that may constitute "plan assets"). Such Opinion of Counsel
must establish to the satisfaction of the Company, the Trustee and the Master
Servicer that such transfer is permissible under applicable law, will not
constitute or result in a non-exempt prohibited transaction under ERISA or
Section 4975 of the Code, and will not subject the Trustee, the Master Servicer
or the Company to any obligation in addition to those undertaken in this
Agreement. Neither the Company, the Master Servicer nor the Trustee will be
required to obtain such Opinion of Counsel on behalf of any prospective
transferee.

                  (d) [Reserved].

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

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

                  (B) In connection with any proposed Transfer of any Ownership
         Interest in a Class R Certificate, the Trustee shall require delivery
         to it, and shall not register the Transfer of any Class R Certificate
         until its receipt of (I) an affidavit and agreement (a "Transfer
         Affidavit and Agreement" in the form attached hereto as Exhibit G-5)
         from the proposed Transferee, in form and substance satisfactory to the
         Trustee representing and warranting, among other things, that it is a
         Permitted Transferee, that it is not acquiring its Ownership Interest
         in the Class R Certificate that is the subject of the proposed Transfer
         as a nominee, trustee or agent for any Person who is not a Permitted
         Transferee, that for so long as it retains its Ownership Interest in a
         Class R Certificate, it will endeavor to remain a Permitted Transferee,
         and that it has reviewed the provisions of this Section 5.02 and agrees
         to be bound by them, and (II) a certificate, in the form attached
         hereto as Exhibit G-4, from the Holder wishing to transfer


                                       95

<PAGE>



         the Class R Certificate, in form and substance satisfactory to the
         Trustee representing and warranting, among other things, that no
         purpose of the proposed Transfer is to impede the assessment or
         collection of tax.

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

                  (D) Each Person holding or acquiring any Ownership Interest in
         a Class R Certificate shall agree (x) to require a Transfer Affidavit
         and Agreement from any other Person to whom such Person attempts to
         transfer its Ownership Interest in a Class R Certificate and (y) not to
         transfer its Ownership Interest unless it provides a certificate to the
         Trustee in the form attached hereto as Exhibit G-4.

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

                  (ii) The Trustee will register the Transfer of any Class R
Certificate only if it shall have received the Transfer Affidavit and Agreement
in the form attached hereto as Exhibit G-5, a certificate of the Holder
requesting such transfer in the form attached hereto as Exhibit G-4 and all of
such other documents as shall have been reasonably required by the Trustee as a
condition to such registration. Transfers of the Class R Certificates other than
to Permitted Transferees are prohibited.

                  (iii) (A) If any Person other than a Permitted Transferee
shall become a Holder of a Class R Certificate, then the last preceding
Permitted Transferee shall be restored, to the extent permitted by law, to all
rights and obligations as Holder thereof retroactive to the date of registration
of such Transfer of such Class R Certificate. If a Non-United States Person
shall become a Holder of a Class R Certificate, then the last preceding
Permitted Transferee shall be restored, to the extent permitted by law, to all
rights and obligations as Holder thereof retroactive to the date of registration
of such Transfer of such Class R Certificate. If a transfer of a Class R
Certificate is disregarded pursuant to the provisions of Treasury Regulations
Section 1.860E-1 or Section 1.860G-3, then the last preceding Permitted
Transferee shall be restored, to the extent permitted by law, to all rights and
obligations as Holder thereof retroactive to the date of registration of such
transfer of such Class R Certificate. The prior Holder shall be entitled to
recover from any purported Holder of a Class R Certificate that was in fact not
a Permitted Transferee under this Section 5.05(b) at the time it became a Holder
all payments made on such Class R Certificate. Each Holder of a Class R
Certificate, by acceptance thereof, shall be deemed for all purposes to have
consented to the


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<PAGE>



provisions of this clause (b) and to any amendment of this Agreement deemed
necessary (whether as a result of new legislation or otherwise) by counsel of
the Company to ensure that the Class R Certificates are not transferred to any
Person who is not a Permitted Transferee and that any transfer of such Class R
Certificates will not cause the imposition of a tax upon the Trust or cause any
such REMIC to fail to qualify as a REMIC. The Trustee shall be under no
liability to any Person for any registration of Transfer of a Class R
Certificate that is in fact not permitted by this Section 5.02 or for making any
payments due on such Certificate to the holder thereof or for taking any other
action with respect to such holder under the provisions of this Agreement.

                           (B) If any purported Transferee shall become a Holder
of a Class R Certificate in violation of the restrictions in this Section 5.02
and to the extent that the retroactive restoration of the rights of the Holder
of such Class R Certificate as described in clause (iii)(A) above shall be
invalid, illegal or unenforceable, then the Trustee shall have the right,
without notice to the holder or any prior holder of such Class R Certificate, to
sell such Class R Certificate to a purchaser selected by the Trustee on such
terms as the Trustee may choose. Such purported Transferee shall promptly
endorse and deliver each Class R Certificate in accordance with the instructions
of the Trustee. Such purchaser may be the Trustee itself. The proceeds of such
sale, net of the commissions (which may include commissions payable to the
Trustee), expenses and taxes due, if any, will be remitted by the Trustee to
such purported Transferee. The terms and conditions of any sale under this
clause (iii)(B) shall be determined in the sole discretion of the Trustee, and
the Trustee shall not be liable to any Person having an Ownership Interest in a
Class R Certificate as a result of its exercise of such discretion.

                  (iv) The Trustee shall make available to the Internal Revenue
Service and those Persons specified by the REMIC Provisions, all information
necessary to compute any tax imposed (A) as a result of the transfer of an
ownership interest in a Class R Certificate to any Person who is a Disqualified
Organization, including the information regarding "excess inclusions" of such
Class R Certificates required to be provided to the Internal Revenue Service and
certain Persons as described in Treasury Regulations Sections 1.860D-1(b)(5) and
1.860E-2(a)(5), and (B) as a result of any regulated investment company, real
estate investment trust, common trust fund, partnership, trust, estate or
organization described in Section 1381 of the Code that holds an Ownership
Interest in a Class R Certificate having as among its record holders at any time
any Person who is a Disqualified Organization. The Trustee may charge and shall
be entitled to reasonable compensation for providing such information as may be
required from those Persons which may have had a tax imposed upon them as
specified in clauses (A) and (B) of this paragraph for providing such
information.

                  (f) Subject to the preceding paragraphs, upon surrender for
registration of transfer of any Certificate at the office of the Trustee
maintained for such purpose, the Trustee shall execute and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same Class of a like aggregate
Percentage Interest. Every Certificate surrendered for transfer shall be
accompanied by notification of the account of the designated transferee or
transferees for the purpose of receiving distributions pursuant to Section 4.01
by wire transfer, if any such transferee desires and is eligible for
distribution by wire transfer.


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                  (g) At the option of the Certificateholders, Certificates may
be exchanged for other Certificates of authorized denominations of the same
Class of a like aggregate Percentage Interest, upon surrender of the
Certificates to be exchanged at the office of the Trustee. Whenever any
Certificates are so surrendered for exchange the Trustee shall execute,
authenticate and deliver the Certificates which the Certificateholder making the
exchange is entitled to receive. Every Certificate presented or surrendered for
transfer or exchange shall (if so required by the Trustee) be duly endorsed by,
or be accompanied by a written instrument of transfer in the form satisfactory
to the Trustee duly executed by, the Holder thereof or his attorney duly
authorized in writing. In addition, with respect to each Class R Certificate,
the Holder thereof may exchange, in the manner described above, such Class R
Certificate for three separate Certificates, each representing such Holder's
respective Percentage Interest in the Class R-1 Interest, the Class R-2 Interest
and the Class R-3 Interest, respectively, in each case that was evidenced by the
Class R Certificate being exchanged.

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

                  (i) All Certificates surrendered for transfer and exchange
shall be canceled and retained by the Trustee in accordance with the Trustee's
standard procedures.

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

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

                  SECTION 5.04.             Persons Deemed Owners.

                  The Company, the Master Servicer, the Trustee and any agent of
any of them may treat the person in whose name any Certificate is registered as
the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 4.01 and for all other purposes whatsoever, and neither the
Company, the Master Servicer, the Trustee nor any agent of any of them shall be
affected by notice to the contrary.


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                  SECTION 5.05.             Rule 144A Information.

                  For so long as any Class P Certificates, Class C Certificates
and Class R Certificates are outstanding and are "restricted securities" within
the meaning of Rule 144(a)(3) of the Securities Act, (1) the Company will
provide or cause to be provided to any holder of such Certificates and any
prospective purchaser thereof designated by such a holder, upon the request of
such holder or prospective purchaser, the information required to be provided to
such holder or prospective purchaser by Rule 144A(d)(4) under the Securities
Act; and (2) the Company shall update such information from time to time in
order to prevent such information from becoming false and misleading and will
take such other actions as are necessary to ensure that the safe harbor
exemption from the registration requirements of the Securities Act under Rule
144A is and will be afor resales of such Certificates conducted in accordance
with Rule 144A. The Master Servicer shall cooperate with the Company and furnish
the Company such information in the Master Servicer's possession as the Company
may reasonably request.


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                                   ARTICLE VI

                       THE COMPANY AND THE MASTER SERVICER

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

                  The Company and the Master Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by the Company and the Master Servicer herein. Only the
Master Servicer, any successor Master Servicer or the Trustee acting as Master
Servicer shall be liable with respect to the servicing of the Mortgage Loans and
the REO Property for actions taken by any such Person in contravention of the
Master Servicer's duties hereunder.

                  SECTION 6.02.             Merger, Consolidation or Conversion
                                            of the Company or the Master
                                            Servicer.

                  The Company and the Master Servicer each will keep in full
effect its existence, rights and franchises as a corporation under the laws of
the state of its incorporation, and each will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.

                  Any Person into which the Company or the Master Servicer may
be merged, consolidated or converted, or any corporation resulting from any
merger or consolidation to which the Company or the Master Servicer shall be a
party, or any Person succeeding to the business othe Company or the Master
Servicer, shall be the successor of the Company or the Master Servicer, as the
case may be, hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding; provided, however, that the successor or surviving
Person to the Master Servicer shall be qualified to sell mortgage loans to and
service mortgage loans for Fannie Mae or Freddie Mac.

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

                  Neither the Company, the Master Servicer nor any of the
directors, officers, employees or agents of the Company or the Master Servicer
shall be under any liability to the Trust Fund or the Certificateholders for any
action taken or for refraining from the taking of any ain good faith pursuant to
this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Company or the Master Servicer (but this
provision shall protect the above described persons) against any breach of
warranties or representations made herein, or against any specific liability
imposed on the Master Servicer pursuant to Section 3.01 or any other Section
hereof; and provided further that this provision shall not protect the Company,
the Master Servicer or any such person, against any liability which would
otherwise be imposed by reason of willful


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misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The Company,
the Master Servicer and any director, officer, employee or agent of the Company
or the Master Servicer may rely in good faith on any document of any kind PRIMA
FACIE properly executed and submitted by any Person respecting any matters
arising hereunder. The Company, the Master Servicer and any director, officer,
employee or agent of the Company or the Master Servicer shall be indemnified and
held harmless by the Trust Fund against any loss, liability or expense incurred
in connection with any legal action relating to this Agreement or the
Certificates (including reasonable legal fees and disbursements of counsel),
other than (a) any loss, liability or expense related to Master Servicer's
servicing obligations with respect to any specific Mortgage Loan or Mortgage
Loans (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement) or related to the Master Servicer's
obligations under Section 3.01, or (b) any loss, liability or expense incurred
by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. Neither the Company nor the Master Servicer
shall be under any obligation to appear in, prosecute or defend any legal action
which is not incidental to its respective duties under this Agreement and which
in its opinion may involve it in any expense or liability; provided, however,
that the Company or the Master Servicer may in its sole discretion undertake any
such action which it may deem necessary or desirable with respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom (except any action or
liability related to the Master Servicer's obligations under Section 3.01) shall
be expenses, costs and liabilities of the Trust Fund, and the Company and the
Master Servicer shall be entitled to be reimbursed therefor from the Certificate
Account as provided in Section 3.11, any such right of reimbursement being prior
to the rights of Certificateholders to receive any amount in the Certificate
Account.

                  SECTION 6.04.             Limitation on Resignation of the
                                            Master Servicer.

                  The Master Servicer shall not resign from the obligations and
duties hereby imposed on it except (a) upon appointment of a successor servicer
reasonably acceptable to the Trustee upon receipt by the Trustee of a letter
from each Rating Agency (obtained by the Master Servicer and at its expense)
that such a resignation and appointment will not, in and of itself, result in a
downgrading of the Certificates or (b) upon determination that its duties
hereunder are no longer permissible under applicable law. Any such determination
permitting the resignation of the Master Servicer shall be evidenced by an
Opinion of Counsel (at the expense of the resigning Master Servicer) to such
effect delivered to the Trustee. No such resignation shall become effective
until the Trustee or a successor servicer shall have assumed the Master
Servicer's responsibilities, duties, liabilities and obligations hereunder.

                  SECTION 6.05.             Sale and Assignment of Master
                                            Servicing.

                  The Master Servicer may sell and assign its rights and
delegate its duties and obligations in their entirety as Master Servicer under
this Agreement; provided, however, that: (i) the purchaser or transferee
accepting such assignment and delegation (a) shall be a Person which


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shall be qualified to service mortgage loans for Fannie Mae or Freddie Mac; (b)
shall, in the cof successor master servicers only, have a net worth of not less
than $10,000,000 (unless otherwise approved by each Rating Agency pursuant to
clause (ii) below); (c) shall be reasonably satisfactory to the Trustee (as
evidenced in a writing signed by the Trustee) as having a comparable servicing
ability to that of the Master Servicer on the Closing Date; (d) shall execute
and deliver to the Trustee an agreement, in form and substance reasonably
satisfactory to the Trustee, which contains an assumption by such Person of the
due and punctual performance and observance of each covenant and condition to be
performed or observed by it as master servicer under this Agreement and any
custodial agreement, from and after the effective date of such agreement; (ii)
each Rating Agency shall be given prior written notice of the identity of the
proposed successor to the Master Servicer and each Rating Agency's rating of the
Certificates in effect immediately prior to such assignment, sale and delegation
will not be downgraded or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect obtained by the Master
Servicer at its expense and delivered to the Trustee; and (iii) the Master
Servicer assigning and selling the master servicing shall deliver to the Trustee
an Officer's Certificate and an Opinion of Counsel (at the expense of the Master
Servicer), each stating that all conditions precedent to such action under this
Agreement have been completed and such action is permitted by and complies with
the terms of this Agreement. No such assignment or delegation shall affect any
liability of the Master Servicer arising prior to the effective date thereof.



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                                   ARTICLE VII

                                     DEFAULT

                  SECTION 7.01.             Events of Default.

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

                (i) any failure by the Master Servicer to deposit into the
         Certificate Account on each Certificate Account Deposit Date the
         amounts required to be deposited therein (other than an Advance) under
         the terms of this Agreement which continues unremedied for two (2)
         Business Days after such amount was required to be remitted; or

               (ii) any failure on the part of the Master Servicer duly to
         observe or perform in any material respect any other of the covenants
         or agreements on the part of the Master Servicer contained in the
         Certificates or in this Agreement (including any breach of the Master
         Servicer's representations and warranties pursuant to Section 2.03(a)
         which materially and adversely affects the interests of the
         Certificateholders) which continues unremedied for a period of 60 days
         after the date on which written notice of such failure, requiring the
         same to be remedied, shall have been given to the Master Servicer by
         the Trustee, or to the Master Servicer and the Trustee by the Holders
         of Certificates entitled to at least 25% of the Voting Rights; or

              (iii) a decree or order of a court or agency or supervisory
         authority having jurisdiction in an involuntary case under any present
         or future federal or state bankruptcy, insolvency or similar law or the
         appointment of a conservator or receiver or liquidator in any
         insolvency, readjustment of debt, marshaling of assets and liabilities
         or similar proceedings, or for the winding-up or liquidation of its
         affairs, shall have been entered against the Master Servicer and such
         decree or order shall have remained in force undischarged or unstayed
         for a period of 60 consecutive days; or

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

                (v) the Master Servicer shall admit in writing its inability to
         pay its debts generally as they become due, file a petition to take
         advantage of or otherwise voluntarily commence a case or proceeding
         under any applicable bankruptcy, insolvency, reorganization or other
         similar statute, make an assignment for the benefit of its creditors,
         or voluntarily suspend payment of its obligations; or

               (vi) the Master Servicer shall fail to deposit in the Certificate
         Account on any Certificate Account Deposit Date an amount equal to any
         required Advance which continues


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         unremedied for the earlier of (a) a period of two (2) Business Days or
         (b) the Business Day immediately preceding the Distribution Date.

If an Event of Default described in clauses (i) - (v) of this Section shall
occur, then, and in each and every such case, so long as such Event of Default
shall not have been remedied, the Trustee or the Holders of Certificates
entitled to at least 51% of the Voting Rights, by notice in writing to the
Master Servicer (and to the Trustee if given by such Holders of Certificates),
with a copy to the Rating Agencies, may terminate all of the rights and
obligations (but not the liabilities) of the Master Servicer under this
Agreement and in and to the Trust Fund, other than its rights as a
Certificateholder hereunder; provided, however, that the successor to the Master
Servicer appointed pursuant to Section 7.02 shall have accepted the duties of
Master Servicer effective upon the resignation or termination of the Master
Servicer. If an Event of Default described in clause (vi) hereof shall occur,
the Trustee shall, by notice to the Master Servicer, and the Company, terminate
all of the rights and obligations of the Master Servicer under this Agreement
and in and to the Trust Fund, other than its rights as a Certificateholder
hereunder; provided, however, that if the Trustee determines (in its sole
discretion) that the failure by the Master Servicer to make any required Advance
was due to circumstances beyond its control, and the required Advance was
otherwise made, the Trustee shall not terminate the Master Servicer. On or after
the receipt by the Master Servicer of such notice, all authority and power of
the Master Servicer under this Agreement, whether with respect to the
Certificates (other than as a holder thereof) or the Mortgage Loans or
otherwise, shall pass to and be vested in the Trustee pursuant to and under this
Section, and, without limitation, the Trustee is hereby authorized and empowered
to execute and deliver, on behalf of the Master Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement or
assignment of the Mortgage Loans and related documents, or otherwise at the
expense of the Master Servicer. The Master Servicer agrees to cooperate with
(and pay any related costs and expenses of) the Trustee in effecting the
termination of the Master Servicer's responsibilities and rights hereunder,
including, without limitation, the transfer to the Trustee or the successor
Master Servicer for administration by it of (i) the property and amounts which
are then or should be part of the Trust Fund or which thereafter become part of
the Trust Fund; (ii) originals or copies of all documents of the Master Servicer
reasonably requested by the Trustee to enable it to assume the Master Servicer's
duties thereunder; (iii) the rights and obligations of the Master Servicer under
the Sub-Servicing Agreements with respect to the Mortgage Loans; and (iv) all
cash amounts which shall at the time be deposited by the Master Servicer or
should have been deposited to the Custodial or the Certificate Account or
thereafter be received with respect to the Mortgage Loans. The Trustee shall not
be deemed to have breached any obligation hereunder as a result of a failure to
make or delay in making any distribution as and when required hereunder caused
by the failure of the Master Servicer to remit any amounts received by it or to
deliver any documents held by it with respect to the Mortgage Loans. For
purposes of this Section 7.01, the Trustee shall not be deemed to have knowledge
of an Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless notice of any event which is in fact such an Event
of Default is received by the Trustee as provided in Section 11.05 and such
notice references the Certificates, the Trust Fund or this Agreement.



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                  SECTION 7.02.             Trustee to Act; Appointment of
                                            Successor.

                  Within 90 days of the time the Master Servicer receives a
notice of termination pursuant to Section 7.01(i) - (v), the Trustee or its
appointed agent shall be the successor in all respects to the Master Servicer in
its capacity as Master Servicer under this Agreement and the transactions set
forth or provided for herein and shall be subject thereafter to all the
responsibilities, duties and liabilities relating thereto placed on the Master
Servicer including the obligation to make Advances which have been or will be
required to be made (except for the responsibilities, duties and liabilities
contained in Section 2.03 and its obligations to deposit amounts in respect of
losses pursuant to Section 3.12 and 4.01(h)) by the terms and provisions hereof;
and provided further, that any failure to perform such duties or
responsibilities caused by the Master Servicer's failure to provide information
required by Section 4.03 shall not be considered a default by the Trustee
hereunder. As compensation therefor, the Trustee shall be entitled to all funds
relating to the Mortgage Loans which the Master Servicer would have been
entitled to charge to the Custodial Account and the Certificate Account if the
Master Servicer had continued to act hereunder. If the Trustee has become the
successor to the Master Servicer in accordance with Section 6.04 or Section
7.02, then notwithstanding the above, if the Trustee shall be unwilling to so
act, or shall be unable to so act, the Trustee may appoint, or petition a court
of competent jurisdiction or appoint, any established housing and home finance
institution, which is also a Fannie Mae- or Freddie Mac- approved mortgage
servicing institution, having a net worth of not less than $10,000,000 as the
successor to the Master Servicer hereunder in the assumption of all or any part
of the responsibilities, duties or liabilities of the Master Servicer hereunder.
Pending appointment of a successor to the Master Servicer hereunder, the Trustee
shall act in such capacity as herein above provided. In connection with such
appointment and assumption, the Trustee may make such arrangements fthe
compensation of such successor out of payments on Mortgage Loans as it and such
successor shall agree; provided, however, that no such compensation shall be in
excess of that permitted the Master Servicer hereunder. Each of the Seller, the
Trustee and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession. In no event
shall the successor Master Servicer be liable for the acts or omissions of the
predecessor Master Servicer.

                  Any successor, including the Trustee, to the Master Servicer
shall maintain in force during its term as master servicer hereunder policies
and fidelity bonds to the same extent as the Master Servicer is so required
pursuant to Section 3.18.

                  Notwithstanding anything else herein to the contrary, in no
event shall the Tbe liable for any Servicing Fee or for any differential in the
amount of the Servicing Fee paid hereunder and the amount necessary to induce
any successor Master Servicer or Servicer, as applicable, to act as successor
Master Servicer or Servicer, as applicable, under this Agreement and the
transactions set forth or provided for herein.

                  SECTION 7.03.             Notification to Certificateholders.



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                  (a) Upon any such termination or appointment of a successor to
the Master Servicer, the Trustee shall give prompt notice thereof to
Certificateholders and to the Rating Agencies.

                  (b) Within 60 days after the occurrence of any Event of
Default, the Trustee shall transmit by mail to all Holders of Certificates
notice of each such Event of Default hereunder known to the Trustee, unless such
Event of Default shall have been cured or waived.

                  SECTION 7.04.             Waiver of Events of Default.

                  The Holders representing at least 51% of the Voting Rights of
Certificates affected by a default or Event of Default hereunder, may waive such
default or Event of Default (other than an Event of Default set forth in Section
7.01(vi)); PROVIDED, HOWEVER, that (a) a default or Event of Default under
clause (i) of Section 7.01 may be waived only by all of the Holders of
Certificates affected by such default or Event of Default and (b) no waiver
pursuant to this Section 7.04 shall affect the Holders of Certificates in the
manner set forth in the second paragraph of Section 11.01 or materially
adversely affect any non-consenting Certificateholder. Upon any such waiver of a
default or Event of Default by the Holders representing the requisite percentage
of Voting Rof Certificates affected by such default or Event of Default, such
default or Event of Default shall cease to exist and shall be deemed to have
been remedied for every purpose hereunder. No such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon except to the extent expressly so waived. The Master Servicer shall give
notice of any such waiver to the Rating Agencies.

                  SECTION 7.05.             List of Certificateholders.

                  Upon written request of three or more Certificateholders of
record, for purposes of communicating with other Certificateholders with respect
to their rights under this Agreement, the Trustee will afford such
Certificateholders access during business hours to the most recent list of
Certificateholders held by the Trustee.


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                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE

                  SECTION 8.01.             Duties of Trustee.

                  The Trustee, prior to the occurrence of an Event of Default
and after the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Default occurs, is continuing and has
not been waived, the Trustee shall exercise such of the rights and powers vested
in it by this Agreement, and use the same degree of care and skill in their
exercise as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs. Any permissive right of the Trustee enumerated in
this Agreement shall not be construed as a duty.

                  The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them in accordance with the
requirements of this Agreement. If any such instrument is found not to conform
to the requirements of this Agreement in a material manner, the Trustee shall
take such action as it deems appropriate to have the instrument corrected, and
if the instrument is not corrected to the T satisfaction, the Trustee will
provide notice thereof to the Certificateholders. Notwithstanding the foregoing,
the Trustee shall not be responsible for the accuracy or content of any
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Master Servicer hereunder or any Opinion of Counsel
required hereunder.

                  The Trustee shall prepare and file or cause to be filed on
behalf of the Trust Fund any tax return that is required with respect to REMIC
1, REMIC 2 and REMIC 3 pursuant to applicable federal, state or local tax laws.

                  The Trustee covenants and agrees that it shall perform its
obligations hereunder in a manner so as to maintain the status of REMIC 1, REMIC
2 and REMIC 3 under the REMIC Provisions and to prevent the imposition of any
federal, state or local income, prohibited transaction, contribution or other
tax on any of REMIC 1, REMIC 2 or REMIC 3 to the extent that maintaining such
status and avoiding such taxes are within the control of the Trustee and are
reasonably within the scope of its duties under this Agreement.

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

                         (i) Prior to the occurrence of an Event of Default, and
                  after the curing or waiver of all such Events of Default which
                  may have occurred, the duties and obligations of the Trustee
                  shall be determined solely by the express provisions of this
                  Agreement, the Trustee shall not be liable except for the
                  performance of such duties


                                       107

<PAGE>



                  and obligations as are specifically set forth in this
                  Agreement, no implied covenants or obligations shall be read
                  into this Agreement against the Trustee and, in the absence of
                  bad faith on the part of the Trustee, the Trustee may
                  conclusively rely, as to the truth of the statements and the
                  correctness of the opinions expressed therein, upon any
                  certificates or opinions furnished to the Trustee and
                  conforming to the requirements of this Agreement;

                        (ii) The Trustee shall not be liable for an error of
                  judgment made in good faith by a Responsible Officer or
                  Responsible Officers of the Trustee, unless it shall be proved
                  that the Trustee was negligent in ascertaining the pertinent
                  facts; and

                       (iii) The Trustee shall not be liable with respect to any
                  action taken, suffered or omitted to be taken by it in good
                  faith in accordance with the dof the Holders of Certificates
                  entitled to at least 25% of the Voting Rights relating tthe
                  time, method and place of conducting any proceeding for any
                  remedy available to the Trustee, or exercising any trust or
                  power conferred upon the Trustee, under this Agreement.

                  SECTION 8.02.             Certain Matters Affecting the
                                            Trustee.

                           Except as otherwise provided in Section 8.01:

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

                (b) The Trustee may consult with counsel and any Opinion of
         Counsel shall be full and complete authorization and protection in
         respect of any action taken or suffered or omitted by it hereunder in
         good faith and in accordance therewith;

                (c) The Trustee shall be under no obligation to exercise any of
         the trusts or powers vested in it by this Agreement, other than its
         obligation to give notice pursuant to this Agreement, or to institute,
         conduct or defend any litigation hereunder or in relation hereto at the
         request, order or direction of any of the Certificateholders, pursuant
         to the provisions of this Agreement, unless such Certificateholders
         shall have offered to the Trustee security or indemnity satisfactory to
         it against the costs, expenses and liabilities which may be incurred
         therein or thereby; nothing contained herein shall, however, relieve
         the Trustee of the obligation, upon the occurrence of an Event of
         Default of which a Responsible Office of the Trustee's corporate trust
         department has actual knowledge (which has not been waived or cured),
         to exercise such of the rights and powers vested in it by this
         Agreement, and to use the same degree of care and skill in their
         exercise as a prudent man would exercise or use under the circumstances
         in the conduct of his own affairs;


                                       108

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                (d) The Trustee shall not be liable for any action taken,
         suffered or omitted bit in good faith and believed by it to be
         authorized or within the discretion or rights or powers conferred upon
         it by this Agreement;

                (e) Prior to the occurrence of an Event of Default hereunder and
         after the curing or waiver of all Events of Default which may have
         occurred, the Trustee shall not be bound to make any investigation into
         the facts or matters stated in any resolution, certificate, statement,
         instrument, opinion, report, notice, request, consent, order, approval,
         bond or other paper or document, unless requested in writing to do so
         by the Holders of Certificates entitled to at least 25% of the Voting
         Rights; provided, however, that if the payment within a reasonable time
         to the Trustee of the costs, expenses or liabilities likely to be
         incurred by it in the making of such investigation is, in the opinion
         of the Trustee, reasonably ato the Trustee by the security afforded to
         it by the terms of this Agreement reasonable expense of every such
         examination shall be paid by the Certificateholders requesting the
         investigation;

                (f) The Trustee may execute any of the trusts or powers
         hereunder or perform any duties hereunder either directly or by or
         through agents, nominees, custodians or attorneys appointed with due
         care, and shall not be responsible for any willful misconduct or
         negligence on the part of any agent, attorney, custodian or nominee so
         appointed;

                (g) The Trustee shall not be required to give any bond or surety
         with respect to the execution of the trust created hereby or the powers
         granted hereunder; and

                (h) Whenever in the administration of the provisions of this
         Agreement the Trustee shall deem it necessary or desirable that a
         matter be proved or established prior to taking or suffering any action
         to be taken hereunder, such matter (unless other evidence in respect
         thereof be herein specifically prescribed) may, in the absence of gross
         negligence or bad faith on the part of the Trustee, be deemed to be
         conclusively proved and established by a certificate signed and
         delivered to the Trustee and such certificate, in the absence of gross
         negligence or bad faith on the part of the Trustee, shall be full
         warrant to the Trustee for any action taken, suffered or omitted by it
         under the provisions of this Agreement upon the faith thereof.

                  SECTION 8.03.             Trustee Not Liable for Certificates
                                            or Mortgage Loans.

                  The recitals contained herein and in the Certificates (other
than the signature of the Trustee, the authentication of the Trustee on the
Certificates, the acknowledgments of the Trustee contained in Article II) shall
be taken as the statements of the Company and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations or
warranties as to the validity or sufficiency of this Agreement or of the
Certificates (other than the signature and authentication of the Trustee on the
Certificates) or of any Mortgage Loan or related document. The Trustee shall not
be accountable for the use or application by the Company of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the


                                       109

<PAGE>



Company or the Master Servicer in respect of the Mortgage Loans or deposited in
or withdrawn from the Custodial Account by the Master Servicer.

                  SECTION 8.04.             Trustee May Own Certificates.

                  The Trustee in its individual or any other capacity (other
than as Trustee hereunder) may become the owner or pledgee of Certificates with
the same rights it would have if it were not Trustee and may otherwise deal with
the parties hereto.

                  SECTION 8.05.             Trustee's Fees.

                  On each Distribution Date, the Trustee shall be entitled to
withdraw from the Certificate Account as compensation hereunder the Trustee's
Fees. Such compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) shall be paid for
all services rendered by it (except as otherwise reimbursed by the Seller
pursuant to a separate fee letter between the Seller and the Trustee) in the
execution of the trusts hereby created and in the exercise and performance of
any of the powers and duties hereunder or of the Trustee. Except as otherwise
provided in this Agreement, the Trustee and any director, officer, employee or
agent of the Trustee shall be indemnified and held harmless by the Trust Fund
against any claim, loss, liability, fee or expense incurred in connection with
any Event of Default, any breach of this Agreement or any claim or legal action
(including any pending or threatened claim or legal action) relating to the
acceptance or administration of its trusts hereunder or the Trustee's
performance under the Certificates, other than any claim, loss, liability or
expense (i) sustained in connection with this Agreement related to the willful
misfeasance, bad faith or negligence of the Master Servicer in the performance
of its duties hereunder or (ii) incurred in connection with a breach
constituting willful misfeasance, bad faith or negligence of the Trustee in the
performance of its duties hereunder or by reason of reckless disregard of its
obligations and duties hereunder.

                  The Master Servicer shall indemnify the Trustee and any
director, officer, employee or agent of the Trustee against any such claim or
legal action (including any pending or threatened claim or legal action), loss,
liability, fee or expense that may be sustained in connection with this
Agreement related to the willful misfeasance, bad faith, or negligence in the
performance of the Master Servicer's duties hereunder.

                  The provisions of this Section 8.05 shall survive the
resignation or removal of the Trustee or the termination of this Agreement.

                  SECTION 8.06.             Eligibility Requirements for
                                            Trustee.

                  The Trustee hereunder shall at all times be a corporation or a
national banking association organized and doing business under the laws of any
state or the United States of America or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having a combined capital
and surplus of at least $50,000,000 and subject to supervision or examination by
federal or state authority. In addition, the Trustee shall at all times be
acceptable to the Rating


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Agency rating the Certificates. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section 8.07.
The corporation or national banking association serving as Trustee may have
normal banking and trust relationships with the Seller and their affiliates or
the Master Servicer and its affiliates; provided, however, that such corporation
cannot be an affiliate of the Master Servicer other than the Trustee in its role
as successor to the Master Servicer.

                  SECTION 8.07.             Resignation and Removal of the
                                            Trustee.

                  The Trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice thereof to the Master Servicer;
with a copy to the Rating Agencies; provided, that such resignation shall not be
effective until a successor trustee is appointed and accepts appointment in
accordance with the following provisions; provided, however, that the resigning
Trustee shall not resign and be discharged from the trusts hereby created until
such time as the Rating Agency rating the Certificates approves the successor
trustee. Upon receiving such notice of resignation, the Master Servicer shall
promptly appoint a successor trustee who meets the eligibility requirements of
Section 8.06 by written instrument, in triplicate, one copy of which instrument
shall be delivered to each of the resigning Trustee and to the successor
trustee. If no successor trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee.

                  If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Master Servicer, or if at any time the Trustee
shall become incapable of acting, or shall be adjudged bankrupt or insolvent, or
a receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, the
Master Servicer may remove the Trustee and appoint a successor trustee who meets
the eligibility requirements of Section 8.06 by written instrument, in
triplicate, which instrument shall be delivered to the Trustee so removed and to
the successor trustee.

                  The Holders of Certificates entitled to at least 51% of the
Voting Rights, may at any time remove the Trustee and appoint a successor
trustee by written instrument or instruments, in triplicate, signed by such
Holders or their attorneys-in-fact duly authorized, one complete set of which
instruments shall be delivered to the Master Servicer, one complete set to the
Trustee so removed and one complete set to the successor so appointed. A copy of
such instrument shall be delivered to the Certificateholders and the Company by
the Master Servicer.



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                  Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.

                  SECTION 8.08.             Successor Trustee.

                  Any successor trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the Master Servicer and to its
predecessor trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if originally
named as trustee herein. The predecessor trustee shall after payment of its
outstanding fees and expenses, promptly deliver to the successor trustee all
assets and records of the Trust Fund held by it hereunder, and the Master
Servicer and the predecessor trustee shall execute and deliver all such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties and obligations.

                  No successor trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 8.06.

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

                  SECTION 8.09.             Merger or Consolidation of Trustee.

                  Any state bank or trust company or corporation or national
banking association into which the Trustee may be merged or converted or with
which it may be consolidated or any state bank or trust company or national
banking association resulting from any merger, conversion or consolidation to
which the Trustee shall be a party, or any state bank or trust company or
corporation or national banking association succeeding to all or substantially
all of the corporate trust business of the Trustee, shall be the successor of
the Trustee hereunder, provided such state bank or trust company or corporation
or national banking association shall be eligible under the provisions of
Section 8.06 without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding.

                  SECTION 8.10.             Appointment of Co-Trustee or
                                            Separate Trustee.

                  Notwithstanding any other provisions hereof, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing


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the same may at the time be located, the Master Servicer and the Trustee acting
jointly shall hthe power and shall execute and deliver all instruments to
appoint one or more Persons approved by the Trustee to act as co-trustee or
co-trustees, jointly with the Trustee, or separate trustee or separate trustees,
of all or any part of the Trust Fund, and to vest in such Person or Persons, in
such capacity, such title to the Trust Fund, or any part thereof, and, subject
to the other provisions of this Section 8.10, such powers, duties, obligations,
rights and trusts as the Master Servicer and the Trustee may consider necessary
or desirable. If the Master Servicer shall not have joined in such appointment
within 15 days after the receipt by it of a request so to do, or in case an
Event of Default shall have occurred and be continuing, the Trustee alone shall
have the power to make such appointment without the Master Servicer. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 8.06 hereunder and no notice to
Holders of Certificates of the appointment of co-trustee(s) or separate
trustee(s) shall be required under Section 8.08 hereof.

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

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

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


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                                   ARTICLE IX

                                   TERMINATION

                  SECTION 9.01.             Termination Upon Repurchase or
                                            Liquidation of All Mortgage Loans or
                                            upon Purchase of Certificates.

         (a) Subject to Section 9.03, the respective obligations and
responsibilities of the Company, the Master Servicer and the Trustee created
hereby (other than the obligations of the Master Servicer to the Trustee
pursuant to Section 8.05 and of the Master Servicer to provide for and the
Trustee to make payments to Certificateholders as hereafter set forth) shall
terminate upon payment to the Certificateholders of all amounts held by or on
behalf of the Trustee and required to be paid to them hereunder following the
earlier to occur of (i) the repurchase by the Holder of a 50.01% Percentage
Interest in the Class C Certificates (the "Majority Class C Certificateholders")
or its designee of all Mortgage Loans and each REO Property in respect thereof
remaining in the Trust Fund at a price equal to (a) 100% of the unpaid principal
balance of each Mortgage Loan (other than one as to which a REO Property was
acquired) on the day of repurchase together with accrued interest on such unpaid
principal balance at the Net Mortgage Rate to the first day of the month in
which the proceeds of such repurchase are to be distributed, plus (b) the
appraised value of any REO Property (but not more than the unpaid principal
balance of the related Mortgage Loan, together with accrued interest on that
balance at the Net Mortgage Rate to the first day of the month such repurchase
price is distributed), less the good faith estimate of the Majority Class C
Certificateholders of liquidation expenses to be incurred in connection with its
disposal thereof, such appraisal to be conducted by an appraiser mutually agreed
upon by the Majority Class C Certificateholders and the Trustee at the expense
of the Master Servicer, and (ii) the final payment or other liquidation (or any
Advance with respect thereto) of the last Mortgage Loan remaining in the Trust
Fund (or the disposition of all REO Property in respect thereof); provided,
however, that in no event shall the trust created hereby continue beyond the
earlier of (i) the Distribution Date occurring in January 2031 and (ii) the
expiration of 21 years from the death of the last survivor of the descendants of
Joseph P. Kennedy, the late ambassador of the United States to the Court of St.
James, living on the date hereof, and provided further that the purchase price
set forth above shall be increased as is necessary, as determined by the
Majority Class C Certificateholders, to avoid disqualification of any of REMIC
1, REMIC 2 or REMIC 3 as a REMIC. In the case of any repurchase by the Majority
Class C Certificateholders pursuant to clause (i), shall exercise reasonable
efforts to cooperate fully with the Trustee in effecting such repurchase and the
transfer of the Mortgage Loans and related Mortgage Files and related records to
the Majority Class C Certificateholders.

                  The right of the Majority Class C Certificateholders or its
designee to repurchase all Mortgage Loans pursuant to (i) above shall be
conditioned upon the aggregate Stated Principal Balance of such Mortgage Loans
at the time of any such repurchase aggregating an amount equal to or less than
10% of the aggregate Stated Principal Balance of the Mortgage Loans at the Cut
Date. If such right is exercised, the Majority Class C Certificateholders upon
such repurchase shall provide to the Trustee, notice of such exercise prior to
the Determination Date in the month preceding the month of purchase and the
certification required by Section 3.16.


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                  Written notice of any termination, specifying the Distribution
Date upon which the Certificateholders may surrender their Certificates to the
Trustee for payment of the final distribution and cancellation, shall be given
promptly by the Trustee by letter to the Certificateholders mailed (a) in the
event such notice is given in connection with the Majority Class C
Certificateholder's election to repurchase, not earlier than the 15th day and
not later than the 25th day of the month next preceding the month of such final
distribution or (b) otherwise during the month of such final distribution on or
before the Determination Date in such month, in each case specifying (i) the
Distribution Date upon which final payment of the Certificates will be made upon
presentation and surrender of Certificates at the office of the Trustee therein
designated, (ii) the amount of any such final payment and (iii) that the Record
Date otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Certificates at the
office of the Trustee therein specified. In the event such notice is given in
connection with the Majority Class C Certificateholder or its designee's
election to repurchase, the Majority Class C Certificateholder or its designee
shall deliver to the Trustee for deposit in the Certificate Account on the
Business Day immediately preceding the Distribution Date specified in such
notice an amount equal to the above-described repurchase price payable out of
its own funds. Upon presentation and surrender of the Certificates by the
Certificateholders, the Trustee shall first, pay itself the Trustee's Fees for
such Distribution Date and any other amounts owing to the Trustee under this
Agreement, and second, distribute to the Certificateholders (i) the amount
otherwise distributable on such Distribution Date, if not in connection with the
Majority Class C Certificateholder's election to repurchase, or (ii) if the
Majority Class C Certificateholder elected to so repurchase, an amount
determined as follows: with respect to each Regular Certificate (other than the
Class A-IO Certificates), the outstanding Certificate Principal Balance thereof,
plus with respect to each Regular Certificate (other than the Class P
Certificates), one month's interest thereon at the applicable Pass- Through Rate
and any Unpaid Interest Shortfall Amount, plus with respect to each Mezzanine
Certificate, any unpaid Allocated Realized Loss Amount; and with respect to the
Class R Certificates, the Percentage Interest evidenced thereby multiplied by
the difference, if any, between the above described repurchase price and the
aggregate amount to be distributed to the Holders of the Regular Certificates,
subject to the priorities set forth in Section 4.01. Notwithstanding the
foregoing, by acceptance of the Class R Certificates, the Holders of the Class R
Certificates agree, in connection with any termination hereunder, to assign and
transfer any amounts received in respect of such termination to the Holders of
the Class C Certificates and to pay any such amounts to the Holders of the Class
C Certificates. Upon certification to the Trustee by a Servicing Officer,
following such final deposit, the Trustee shall promptly release the Mortgage
Files as directed bthe Majority Class C Certificateholder for the remaining
Mortgage Loans, and the Trustee shall execute all assignments, endorsements and
other instruments required by the Majority Class C Certificateholder as being
necessary to effectuate such transfer.

                  In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the time
specified in the above-mentioned notice, the Trustee shall give a second notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
six months after the second notice all of the Certificates shall not have been
surrendered for cancellation, the Trustee shall take reasonable steps as
directed by the Company in writing, or appoint an agent to take


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reasonable steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets which remain subject hereto. If within nine months after
the second notice all the Certificates shall not have been surrendered for
cancellation, the Class R Certificateholders shall be entitled to all unclaimed
funds and other assets which remain subject hereto.

                  SECTION 9.02.             Termination of REMIC 2 and REMIC 3.

                  REMIC 2 shall be terminated on the earlier of the Final
Distribution Date and the date on which it is deemed to receive the last deemed
distributions on the REMIC 1 Regular Interests and the last distribution due on
the REMIC 2 Regular Interests and the Class R Certificates (in respect of the
Class R-2 Interest) is made. REMIC 3 shall be terminated on the earlier of the
Final Distribution Date and the date on which it is deemed to receive the last
deemed distributions on the REMIC 2 Regular Interests and the last distribution
due on the Regular Certificates and the Class R Certificates (in respect of the
Class R-3 Interest) is made.

                  SECTION 9.03.             Additional Termination Requirements.

                  (a) In the event the Majority Class C Certificateholder
repurchases the Mortgage Loans as provided in Section 9.01, the Trust Fund shall
be terminated in accordance with the following additional requirements, unless
the Majority Class C Certificateholder, at its own expense, obtains for the
Trustee an Opinion of Counsel to the effect that the failure of the Trust Fund
to comply with the requirements of this Section 9.03 will not (i) result in the
imposition on the Trust of taxes on "prohibited transactions," as described in
Section 860F of the Code, or (ii) cause either REMIC 1, REMIC 2 or REMIC 3 to
fail to qualify as a REMIC at any time that any Certificate is outstanding:

                  (i) The Trustee shall establish a 90-day liquidation period
         for REMIC 1, REMIC 2 and REMIC 3, as the case may be, and specify the
         first day of such period in a statement attached to the Trust Fund's
         final Tax Return pursuant to Treasury regulations Section 1.860F-1. The
         Trustee also shall satisfy all of the requirements of a qualified
         liquidation for REMIC 1, REMIC 2 and REMIC 3, as the case may be, under
         Section 860F of the Code and regulations thereunder; and

                  (ii) The Majority Class C Certificateholder shall notify the
         Trustee at the commencement of such 90-day liquidation period and, at
         or prior to the time of making of the final payment on the
         Certificates, the Trustee shall sell or otherwise dispose of all of the
         remaining assets of the Trust Fund in accordance with the terms hereof.

         (b) Each Holder of a Certificate and the Trustee hereby irrevocably
approves and appoints the Master Servicer as its attorney-in-fact to adopt a
plan of complete liquidation for REMIC 1, REMIC 2 and REMIC 3 at the expense of
the Trust Fund in accordance with the terms and conditions of this Agreement.


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                                    ARTICLE X

                                REMIC PROVISIONS

                  SECTION 10.01.            REMIC Administration.

         (a) The Trustee shall make an election to treat the Trust Fund as three
REMICs uthe Code and, if necessary, under applicable state law. Each such
election will be made on Form 1066 or other appropriate federal tax or
information return (including Form 8811) or any appropriate state return for the
taxable year ending on the last day of the calendar year in which the
Certificates are issued. For the purposes of the REMIC elections in respect of
the Trust Fund, (i) the Class R-1 Interest will constitute the sole class of
"residual interest" in REMIC 1, (ii) the Class R-2 Interest will constitute the
sole class of "residual interest" in REMIC 2, and (iii) the Class R-3 Interest
will constitute the sole class of "residual interest" in REMIC 3, and the
Regular Certificates shall be designated as the "regular interests" in REMIC 3.
The Master Servicer and the Trustee shall not permit the creation of any
"interests" (within the meaning of Section 860G of the Code) in REMIC 1, REMIC 2
or REMIC 3 other than the REMIC 1 Regular Interests and the Class R-1 Interest
(in the case of REMIC 1), the REMIC 2 Regular Interests and the Class R-2
Interest (in the case of REMIC 2), and the Regular Certificates and the Class
R-3 Interest (in the case of REMIC 3). The Trustee will apply for an Employee
Identification Number from the IRS via form SS-4 or any other acceptable method
for each of REMIC 1, REMIC 2 and REMIC 3.

         (b) The Closing Date is hereby designated as the "startup day" of the
Trust Fund within the meaning of Section 860G(a)(9) of the Code.

         (c) The Trustee shall pay out of its own funds, without any right of
reimbursement, any and all expenses relating to any tax audit of the REMICs
(including, but not limited to, any professional fees or any administrative or
judicial proceedings with respect to the REMICs that involve the Internal
Revenue Service or state tax authorities), other than the expense of obtaining
any tax related Opinion of Counsel except as specified herein. The Trustee, as
agent for the REMICs' tax matters person, shall (i) act on behalf of the REMICs
in relation to any tax matter or controversy involving the Trust Fund and (ii)
represent the Trust Fund in any administrative or judicial proceeding relating
to an examination or audit by any governmental taxing authority with respect
thereto. By their acceptance thereof, the holder of the largest Percentage
Interest of the Class R Certificates hereby agrees to irrevocably appoint the
Trustee or an Affiliate as its agent to perform all of the duties of the tax
matters person for the REMICs.

                  (d) The Trustee shall prepare, sign and file all of the Tax
Returns (including Form 8811, which must be filed within 30 days of the Closing
Date) in respect of the REMICs created hereunder. The expenses of preparing and
filing such returns shall be borne by the Trustee without any right of
reimbursement therefor. The Master Servicer shall provide on a timely basis to
the Trustee or its designee such information with respect to the assets of the
REMICs as is in its possession and reasonably required by the Trustee to enable
it to perform its obligations under this Article X.


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

                  (f) The Trustee shall take such action and shall cause the
REMICs created hereunder to take such action as shall be necessary to create or
maintain the status thereof as REMICs under the REMIC Provisions (and the Master
Servicer shall assist it, to the extent reasonably requested by it). The Trustee
shall not take any action, cause the Trust Fund to take any action or fail to
take (or fail to cause to be taken) any action that, under the REMIC Provisions,
if taken or not taken, as the case may be, could (i) endanger the status of the
REMIC 1, REMIC 2 or REMIC 3 as REMICs or (ii) result in the imposition of a tax
upon the REMICs (including but not limited to the tax on prohibited transactions
as defined in Section 860F(a)(2) of the Code and the tax on contributions to a
REMIC set forth in Section 860G(d) of the Code) (either such event, an "Adverse
REMIC Event") unless the Trustee has received an Opinion of Counsel, addressed
to the Trustee (at the expense of the party seeking to take such action but in
no event at the expense of the Trustee) to the effect that the contemplated
action will not, with respect to the REMICs created hereunder, endanger such
status or result in the imposition of such a tax, nor shall the Master Servicer
take or fail to take any action (whether or not authorized hereunder) as to
which the Trustee has advised it in writing that it has received an Opinion of
Counsel to the effect that an Adverse REMIC Event could occur with respect to
such action. In addition, prior to taking any action with respect to the REMICs
or the assets of the REMICs, or causing the REMICs to take any action, which is
not contemplated under the terms of this Agreement, the Master Servicer will
consult with the Trustee or its designee, in writing, with respect to whether
such action could cause an Adverse REMIC Event to occur with respect to the
Trust Fund, and the Master Servicer shall not take any such action or cause the
Trust Fund to take any such action as to which the Trustee has advised it in
writing that an Adverse REMIC Event could occur. The Trustee may consult with
counsel to make such written advice, and the cost of same shall be borne by the
party seeking to take the action not permitted by this Agreement, but in no
event shall such cost be an expense of the Trustee. At all times as may be
required by the Code, the Trustee will ensure that substantially all of the
assets


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

                  (g) In the event that any tax is imposed on "prohibited
transactions" of the REMICs created hereunder as defined in Section 860F(a)(2)
of the Code, on the "net income from foreclosure property" of the REMICs as
defined in Section 860G(c) of the Code, on any contributions to the REMICs after
the Startup Day therefor pursuant to Section 860G(d) of the Code, or any other
tax is imposed by the Code or any applicable provisions of state or local tax
laws, such tax shall be charged (i) to the Trustee pursuant to Section 10.03
hereof, if such tax arises out of or results from a breach by the Trustee of any
of its obligations under this Article X, (ii) to the Master Servicer pursuant to
Section 10.03 hereof, if such tax arises out of or results from a breach by the
Master Servicer of any of its obligations under Article III or this Article X,
or otherwise, (iii) to the Master Servicer as provided in Section 3.05 and (iv)
against amounts on deposit in the Certificate Account and shall be paid by
withdrawal therefrom to the extent not required to be paid by the Master
Servicer or the Trustee pursuant to another provision of this Agreement.

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

                  (i) The Trustee shall, for federal income tax purposes,
maintain books and records with respect to the REMICs on a calendar year and on
an accrual basis.

                  (j) Following the Startup Day, the Trustee shall not accept
any contributions of assets to the REMICs other than in connection with any
Qualified Substitute Mortgage Loan delivered in accordance with Section 2.04
unless it shall have received an Opinion of Counsel to the effect that the
inclusion of such assets in the REMICs will not cause the REMIC 1, REMIC 2 or
REMIC 3 to fail to qualify as REMICs at any time that any Certificates are
outstanding or subject either REMIC 1, REMIC 2 or REMIC 3 to any tax under the
REMIC Provisions or other applicable provisions of federal, state and local law
or ordinances.

                  (k) Neither the Trustee nor the Master Servicer shall enter
into any arrangement by which the REMICs will receive a fee or other
compensation for services nor permit the REMICs to receive any income from
assets other than "qualified mortgages" as defined in Section 860G(a)(3) of the
Code or "permitted investments" as defined in Section 860G(a)(5) of the Code.

                  SECTION 10.02.            Prohibited Transactions and
                                            Activities.

                  None of the Company, the Master Servicer or the Trustee shall
sell, dispose of or substitute for any of the Mortgage Loans (except in
connection with (i) the foreclosure of a Mortgage Loan, including but not
limited to, the acquisition or sale of a Mortgaged Property acquired by deed in
lieu of foreclosure, (ii) the bankruptcy of the Trust Fund, (iii) the
termination of REMIC 1, REMIC 2 or REMIC 3 pursuant to Article IX of this
Agreement, (iv) a substitution pursuant to Article II of this Agreement or (v) a
purchase of Mortgage Loans pursuant to Article II or III of this


                                       119

<PAGE>



Agreement), nor acquire any assets for the Trust Fund (other than REO Property
acquired in respect of a defaulted Mortgage Loan), nor sell or dispose of any
investments in the Custodial Account or the Certificate Account for gain, nor
accept any contributions to the REMICs after the Closing Date (other than a
Qualified Substitute Mortgage Loan delivered in accordance with Section 2.03),
unless it has received an Opinion of Counsel, addressed to the Trustee (at the
expense of the party seeking to cause such sale, disposition, substitution,
acquisition or contribution but in no event at the expense of the Trustee) that
such sale, disposition, substitution, acquisition or contribution will not (a)
affect adversely the status of REMIC 1, REMIC 2 or REMIC 3 as REMICs or (b)
cause the Trust Fto be subject to a tax on "prohibited transactions" or
"contributions" pursuant to the REMIC Provisions.

                  SECTION 10.03.            Master Servicer and Trustee
                                            Indemnification.

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

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


                                       120

<PAGE>



                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

                  SECTION 11.01.            Amendment.

                  This Agreement may be amended from time to time by the
Company, the Master Servicer and the Trustee, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be defective or inconsistent with any other
provisions herein or to correct any error, (iii) to amend this Agreement in any
respect subject to the provisions in clauses (A) and (B) below, or (iv) if such
amendment, as evidenced by an Opinion of Counsel (provided by the Person
requesting such amendment) delivered to the Trustee, is reasonably necessary to
comply with any requirements imposed by the Code or any successor or amendatory
statute or any temporary or final regulation, revenue ruling, revenue procedure
or other written official announcement or interpretation relating to federal
income tax laws or any proposed such action which, if made effective, would
apply retroactively to the Trust Fund at least from the effective date of such
amendment; provided that such action (except any amendment described in (iv)
above) shall not adversely affect in any material respect the interests of any
Certificateholder (other than Certificateholders who shall consent to such
amendment), as evidenced by (A) an Opinion of Counsel (provided by the Person
requesting such amendment) delivered to the Trustee, and (B) a letter from each
Rating Agency, confirming that such amendment shall not cause it to lower its
rating on any of the Certificates.

                  This Agreement may also be amended from time to time by the
Company, the Master Servicer and the Trustee and Holders of Certificates
entitled to at least 66-2/3% of the Voting Rights for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in any
manner the amount of, or delay the timing of, payments received on Mortgage
Loans which are required to be distributed on any Certificate without the
consent of the Holder of such Certificate, (ii) adversely affect in any material
respect the interests of the Holders of any Class of Certificates in a manner
other than as described in (i), without the consent of the Holders of
Certificates of such Class evidencing at least 66-2 of the Voting Rights of such
Class, or (iii) reduce the aforesaid percentage of Certificates the Holders of
which are required to consent to any such amendment, without the consent of the
Holders of all Certificates then outstanding. Notwithstanding any other
provision of this Agreement, for purposes of the giving or withholding of
consents pursuant to this Section 11.01, Certificates registered in the name of
the Seller or the Master Servicer or any affiliate thereof shall be entitled to
Voting Rights with respect to matters described in (i), (ii) and (iii) of this
paragraph.

                  Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel (provided by the Person requesting
such amendment) to the effect that such amendment will not result in the
imposition of any tax on either REMIC 1, REMIC 2 or REMIC 3 pursuant to the


                                       121

<PAGE>



REMIC Provisions or cause either REMIC 1, REMIC 2 or REMIC 3 to fail to qualify
as a REMIC at any time that any Certificates are outstanding.

                  Promptly after the execution of any such amendment the Trustee
shall furnish a copy of such amendment or a written statement describing the
amendment to each Certificateholder, with a copy to the Rating Agencies.

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

                  Prior to executing any amendment pursuant to this Section, the
Trustee shall be entitled to receive an Opinion of Counsel (provided by the
Person requesting such amendment) to the effect that such amendment is
authorized or permitted by this Agreement. The cost of any Opinion of Counsel
delivered pursuant to this Section 11.01 shall be an expense of the party
requesting such amendment, but in any case shall not be an expense of the
Trustee.

                  The Trustee may, but shall not be obligated to enter into any
amendment pto this Section that affects its rights, duties and immunities under
this Agreement or otherwise.

                  SECTION 11.02.            Recordation of Agreement;
                                            Counterparts.

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

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

                  SECTION 11.03.            Limitation on Rights of
                                            Certificateholders.

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


                                       122

<PAGE>




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

                  No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a notice of an Event of
Default, or of a default by the Seller or the Trustee in the performance of any
obligation hereunder, and of the continuance thereof, as hereinbefore provided,
and unless also the Holders of Certificates entitled to at least 51% of the
Voting Rights shall have made written request upon the Trustee to institute such
action, suit or proceeding in its own name as Trustee hereunder and shall have
offered to the Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or thereby, and the
Trustee, for 60 days after its receipt of such notice, request and offer of
indemnity, shall have neglected or refused to institute any such action, suit or
proceeding. It is understood and intended, and expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates shall have any right in any manner whatever
by virtue of any provision of this Agreement to affect, disturb or prejudice the
rights of the Holders of any other of such Certificates, or to obtain or seek to
obtain priority over or preference to any other such Holder, or to enforce any
right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.

                  SECTION 11.04.            Governing Law.

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

                  SECTION 11.05.            Notices.

                  All demands, notices and direction hereunder shall be in
writing and shall be deemed effective upon receipt when delivered to (a) in the
case of the Company, Impac Funding, 1401 Dove Street, Newport Beach, California
92660, Attention: General Counsel, or such other address as may hereafter be
furnished to the other parties hereto in writing; (b) in the case of Impac
Funding, 1401 Dove Avenue, Newport Beach, California 92660, Attention: General
Counsel, or such other address as may hereafter be furnished to the other
parties hereto in writing; (c) in the case of the Trustee, to its Corporate
Trust Office, or such other address as may hereafter be furnished to the other
parties hereto in writing; or (d) in the case of the Rating Agencies, Standard &
Poor's, 55 Water Street, 41st


                                       123

<PAGE>



Floor, New York, NY 10041 Attention: Residential Mortgage Surveillance Group;
Fitch, Fitch, Inc., One State Street, 30th Floor, New York, New York 10004,
Attention: Mortgage Backed Securities Department, Impac 2001-3; and Moody's,
Moody's Investors Service, Inc., ABS Monitoring Department, 99 Church Street,
New York, New York 10007. Any notice required or permitted to be mailed to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.

                  SECTION 11.06.            Severability of Provisions.

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

                  SECTION 11.07.            Successors and Assigns.

                  The provisions of this Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the parties
hereto, and all such provisions shall inure to the benefit of the Trustee and
the Certificateholders.

                  SECTION 11.08.            Article and Section Headings.

                  The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.

                  SECTION 11.09.            Notice to Rating Agencies.

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

                  1.  Any material change or amendment to this Agreement;

                  2.  The occurrence of any Event of Default that has not been
                      cured;

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

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

                  5.  The final payment to Certificateholders; and

                  6.  Any change in the location of the Custodial Account or the
                      Certificate Account.


                                       124

<PAGE>



                  In addition, the Trustee shall promptly furnish to the Rating
Agency copies of each report to Certificateholders described in Section 4.02;
and the Master Servicer shall promptly furnish to the Rating Agency copies of
each annual independent public accountants' servicing report received as
described in Section 3.20.

                  Any such notice pursuant to this Section 11.09 shall be in
writing and shall be deemed to have been duly given if personally delivered or
mailed by first class mail, postage prepaid, or by express delivery service to
(i) in the case of Standard & Poor's, 55 Water Street, 41st Floor, New York, New
York 10041, (ii) in the case of Moody's, ABS Monitoring Department, 99 Church
Street, New York, New York 10007, and (iii) in the case of Fitch, One State
Street Plaza, 30th Floor, New York, New York 10004, or, in each case, such other
address as any such Rating Agency may designate in writing to the parties
thereto.



                                       125

<PAGE>



                  IN WITNESS WHEREOF, the Company, the Master Servicer and the
Trustee have caused their names to be signed hereto by their respective officers
thereunto duly authorized all as of the day and year first above written.

                                           IMPAC SECURED ASSETS CORP.,
                                                    Company



                                           By: /s/ Richard J. Johnson
                                              ----------------------------------
                                           Name:         Richard J. Johnson
                                           Title:        Chief Financial Officer


                                           IMPAC FUNDING CORPORATION,
                                                    Master Servicer



                                           By: /s/ Lisa A. Duehring
                                              ----------------------------------
                                           Name:         Lisa A. Duehring
                                           Title:        Senior Vice President


                                           BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.,
                                                    as Trustee



                                           By: /s/ James F. Noriega
                                              ----------------------------------
                                           Name:      James F. Noriega
                                           Title:        Associate



<PAGE>



STATE OF CALIFORNIA    )
                       )  ss.:
COUNTY OF ORANGE       )


                  On the 30th day of April, 2001 before me, a notary public in
and for said State, personally appeared Richard J. Johnson, known to me to be
the Chief Financial Officer of Impac Secured Assets Corp., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

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

                                              ______________________________
                                                          Notary Public


[Notarial Seal]





<PAGE>




STATE OF CALIFORNIA    )
                       )  ss.:
COUNTY OF ORANGE       )


                  On the 30th day of April, 2001, before me, a notary public in
and for said State, personally appeared Lisa A. Duehring, known to me to be a
Senior Vice President of Impac Funding Corporation, one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

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

                                               ______________________________
                                                           Notary Public


[Notarial Seal]



<PAGE>


STATE OF CALIFORNIA    )
                       )  ss.:
COUNTY OF ORANGE       )


                  On the 30th day of April, 2001, before me, a notary public in
and for said State, personally appeared James F. Noriega, known to me to be an
Associate of Bankers Trust Company of California, N.A., the corporation that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

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

                                               ______________________________
                                                           Notary Public


[Notarial Seal]

<PAGE>

                                    EXHIBIT A

                           FORM OF CLASS A CERTIFICATE

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

         THIS CERTIFICATE SHALL INITIALLY BE ISSUED AS ONE OR MORE CERTIFICATES
REGISTERED IN THE NAME OF THE DEPOSITORY OR ITS NOMINEE AND, EXCEPT AS PROVIDED
BELOW, REGISTRATION OF SUCH CERTIFICATES MAY NOT BE TRANSFERRED BY THE TRUSTEE
EXCEPT TO ANOTHER DEPOSITORY THAT AGREES TO HOLD SUCH CERTIFICATES FOR THE
RESPECTIVE CERTIFICATE OWNERS WITH OWNERSHIP INTERESTS THEREIN. THE CERTIFICATE
OWNERS SHALL HOLD THEIR RESPECTIVE OWNERSHIP INTERESTS IN AND TO EACH OF SUCH
BOOK-ENTRY CERTIFICATES THROUGH THE BOOK-ENTRY FACILITIES OF THE DEPOSITORY AND,
EXCEPT AS PROVIDED BELOW, SHALL NOT BE ENTITLED TO DEFINITIVE CERTIFICATES IN
RESPECT OF SUCH OWNERSHIP INTERESTS. ALL TRANSFERS BY CERTIFICATE OWNERS OF
THEIR RESPECTIVE OWNERSHIP IN THE BOOK-ENTRY CERTIFICATES SHALL BE MADE IN
ACCORDANCE WITH THE PROCEDURES ESTABLISHED BY THE DEPOSITORY PARTICIPANT OR
BROKERAGE FIRM REPRESENTING SUCH CERTIFICATE OWNER. EACH DEPOSITORY PARTICIPANT
SHALL TRANSFER THE OWNERSHIP INTERESTS ONLY IN THE BOOK-ENTRY CERTIFICATES OF
CERTIFICATE OWNERS IT REPRESENTS OR OF BROKERAGE FIRMS FOR WHICH IT ACTS AS
AGENT IN ACCORDANCE WITH THE DEPOSITORY'S NORMAL PROCEDURES. THE TRUSTEE SHALL
NOT BE REQUIRED TO MONITOR, DETERMINE OR INQUIRE AS TO COMPLIANCE WITH THE
TRANSFER RESTRICTIONS WITH RESPECT TO THE BOOK-ENTRY CERTIFICATES, AND THE
TRUSTEE SHALL HAVE NO LIABILITY FOR TRANSFERS OF OWNERSHIP INTERESTS IN THE
BOOK-ENTRY CERTIFICATES MADE THROUGH THE BOOK- ENTRY FACILITIES OF THE
DEPOSITORY OR BETWEEN OR AMONG DEPOSITORY PARTICIPANTS OR CERTIFICATE OWNERS,
MADE IN VIOLATION OF THE APPLICABLE RESTRICTIONS.





                                                        A-1

<PAGE>



Certificate No. __                            _____% Pass-Through Rate
Class A-__

Date of Pooling and Servicing                 Percentage Interest: ____%
Agreement and Cut-off Date:
April 1, 2001

First Distribution Date:                      Aggregate Initial [Certificate
May 25, 2001                                  Principal Balance] [Notional
                                              Amount] of the Class A-__
                                              Certificates:$____________

Master Servicer:                              Initial [Certificate Principal
Impac Funding Corporation                     Balance] [Notional Amount] of this
                                              Certificate: $____________

Assumed Final                                 CUSIP _________
Distribution Date:
April 25, 2031
[October 25, 2003]


                        MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2001-3

         evidencing a percentage interest in the distributions allocable to the
         Class A-__ Certificates with respect to a Trust Fund consisting
         primarily of a pool of conforming one- to four-family fixed-rate first
         lien mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, the Master Servicer or any of their affiliates
will have any obligation with respect to any certificate or other obligation
secured by or payable from payments on the Certificates.

         This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
Initial [Certificate Principal Balance] [Notional Amount] of this Certificate by
the aggregate Initial [Certificate Principal Balance] [Notional Amount] of all
Class A-___ Certificates, both as specified above) in certain distributions with
respect to the Trust Fund consisting primarily of an interest in a pool of
conventional one- to four-family fixed-rate first lien mortgage loans (the
"Mortgage Loans"), formed and sold by Impac Secured Assets Corp.


                                       A-2

<PAGE>



(hereinafter called the "Company," which term includes any successor entity
under the Agreement referred to below). The Trust Fund was created pursuant to a
Pooling and Servicing Agreement dated as specified above (the "Agreement") among
the Company, the Master Servicer and Bankers Trust Company of California, N.A.,
as trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing as
described in the Agreement, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date (the "Record Date"),
from the Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount of [interest
and] [principal], if any, required to be distributed to Holders of Class A-__
Certificates on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or by check mailed to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register.

         Notwithstanding the above, the final distribution on this Certificate
will be made after due notice of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose in the City and State of New York. The Initial
[Certificate Principal Balance] [Notional Amount] of this Certificate is set
forth above. The [Certificate Principal Balance] [Notional Amount] hereof will
be reduced to the extent of [distributions allocable to principal and] any
Realized Losses allocable hereto.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.



                                       A-3

<PAGE>



         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without limitation
reimbursement to the Trustee, the Company and the Master Servicer of advances
made, or certain expenses incurred, by either of them.

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

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

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

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

         The Company, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Company, the
Master Servicer, the Trustee nor any such agent shall be affected by notice to
the contrary.



                                       A-4

<PAGE>



         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Holder of at least 50.01% Percentage Interest in the
Class C Certificates (the "Majority Class C Certificateholder") from the Trust
Fund of all remaining Mortgage Loans and each REO Property in respect thereof
remaining in the Trust Fund, thereby effecting early retirement of the
Certificates and (ii) the final payment or other liquidation (or any Advance
with respect thereto) of the last Mortgage Loan remaining in the Trust Fund (or
the disposition of all REO Property in respect thereof). The Agreement permits,
but does not require, the Majority Class C Certificateholder to purchase at a
price determined as provided in the Agreement all remaining Mortgage Loans and
all REO Property; provided, that any such option may only be exercised if the
aggregate Stated Principal Balance of the Mortgage Loans as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the aggregate Stated Principal Balance of the Mortgage Loans at
the Cut-off Date.

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


                                       A-5

<PAGE>



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


Dated:  April__, 2001                 BANKERS TRUST COMPANY OF
                                      CALIFORNIA, N.A.,
                                         as Trustee


                                      By:
                                         -----------------------------
                                          Authorized Signatory



                          CERTIFICATE OF AUTHENTICATION

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

                                      BANKERS TRUST COMPANY OF
                                      CALIFORNIA, N.A.,
                                      as Trustee


                                      By:
                                         -----------------------------
                                          Authorized Signatory




                                       A-6

<PAGE>



                                   ASSIGNMENT


                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto ----------------------------- (Please print or typewrite
name address including postal zip code of assignee) a Percentage Interest
evidenced by the within Mortgage Pass-Through Certificate and hereby authorizes
the transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:-----------------------------

-------------------------------------------------------------------------------




Dated:                           ----------------------------------------------
                                    Signature by or on behalf of assignor



                                        -----------------------------
                                           Signature Guaranteed




                                       A-7

<PAGE>



                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

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

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


                                       A-8

<PAGE>



                                   EXHIBIT B-1

                        FORM OF CLASS [M][B] CERTIFICATE

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES, [THE CLASS M-1 CERTIFICATES][AND THE CLASS M-2 CERTIFICATES] AS
DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).

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

         THIS CERTIFICATE SHALL INITIALLY BE ISSUED AS ONE OR MORE CERTIFICATES
REGISTERED IN THE NAME OF THE DEPOSITORY OR ITS NOMINEE AND, EXCEPT AS PROVIDED
BELOW, REGISTRATION OF SUCH CERTIFICATES MAY NOT BE TRANSFERRED BY THE TRUSTEE
EXCEPT TO ANOTHER DEPOSITORY THAT AGREES TO HOLD SUCH CERTIFICATES FOR THE
RESPECTIVE CERTIFICATE OWNERS WITH OWNERSHIP INTERESTS THEREIN. THE CERTIFICATE
OWNERS SHALL HOLD THEIR RESPECTIVE OWNERSHIP INTERESTS IN AND TO EACH OF SUCH
BOOK-ENTRY CERTIFICATES THROUGH THE BOOK-ENTRY FACILITIES OF THE DEPOSITORY AND,
EXCEPT AS PROVIDED BELOW, SHALL NOT BE ENTITLED TO DEFINITIVE CERTIFICATES IN
RESPECT OF SUCH OWNERSHIP INTERESTS. ALL TRANSFERS BY CERTIFICATE OWNERS OF
THEIR RESPECTIVE OWNERSHIP IN THE BOOK-ENTRY CERTIFICATES SHALL BE MADE IN
ACCORDANCE WITH THE PROCEDURES ESTABLISHED BY THE DEPOSITORY PARTICIPANT OR
BROKERAGE FIRM REPRESENTING SUCH CERTIFICATE OWNER. EACH DEPOSITORY PARTICIPANT
SHALL TRANSFER THE OWNERSHIP INTERESTS ONLY IN THE BOOK-ENTRY CERTIFICATES OF
CERTIFICATE OWNERS IT REPRESENTS OR OF BROKERAGE FIRMS FOR WHICH IT ACTS AS
AGENT IN ACCORDANCE WITH THE DEPOSITORY'S NORMAL PROCEDURES. THE TRUSTEE SHALL
NOT BE REQUIRED TO MONITOR, DETERMINE OR INQUIRE AS TO COMPLIANCE WITH THE
TRANSFER RESTRICTIONS WITH RESPECT TO THE BOOK-ENTRY CERTIFICATES, AND THE
TRUSTEE SHALL HAVE NO LIABILITY FOR TRANSFERS OF OWNERSHIP INTERESTS IN THE
BOOK-ENTRY CERTIFICATES MADE THROUGH THE BOOK- ENTRY FACILITIES OF THE
DEPOSITORY OR BETWEEN OR AMONG DEPOSITORY PARTICIPANTS OR CERTIFICATE OWNERS,
MADE IN VIOLATION OF THE APPLICABLE RESTRICTIONS.






                                      B-1-1

<PAGE>




Certificate No. __                     ______% Pass-Through Rate

Class [M-__][B] Subordinate            Aggregate Initial [Certificate Principal
                                       Balance][Notional
                                       Amount] of the Class
                                       [M- __][B]
                                       Certificates:
                                       $______________

Date of Pooling and Servicing          Initial [Certificate Principal Balance]
Agreement and Cut-off Date:            [Notional Amount] of this Certificate:
April 1, 2001                          $_______________

First Distribution Date:               CUSIP: ______________
May 25, 2001
Master Servicer:
Impac Funding Corporation
Assumed Final Distribution Date:
April 25, 2031


                       MORTGAGE PASS-THROUGH CERTIFICATE,
                                  Series 2001-3

         evidencing a percentage interest in any distributions allocable to the
         Class [M-__][B] Certificates with respect to the Trust Fund consisting
         primarily of a pool of conforming one- to four-family fixed-rate first
         lien mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, the Master Servicer or any of their affiliates
will have any obligation with respect to any certificate or other obligation
secured by or payable from payments on the Certificates.

         This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
Initial [Certificate Principal Balance][Notional Amount] of this Certificate by
the aggregate Initial [Certificate Principal Balance][Notional Amount] of all
Class [M-__][B] Certificates, both as specified above) in certain distributions
with respect to a Trust Fund consisting primarily of a pool of conforming one-
to four-family fixed-rate first lien mortgage loans (the "Mortgage Loans"),
formed and sold by Impac Secured Assets Corp. (hereinafter called the "Company,"
which term includes any successor entity under the Agreement referred to below).
The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated
as specified above


                                      B-1-2

<PAGE>



(the "Agreement") among the Company, the Master Servicer and Bankers Trust
Company of California, N.A., as trustee (the "Trustee"), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing as
described in the Agreement, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date (the "Record Date"),
from the Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount (of interest
[and principal], if any) required to be distributed to Holders of Class [M-
__][B] Certificates on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or by check mailed to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register.

         Notwithstanding the above, the final distribution on this Certificate
will be made after due notice of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose in the City and State of New York. The Initial
[Certificate Principal Balance][Notional Amount] of this Certificate is set
forth above. The [Certificate Principal Balance][Notional Amount] hereof will be
reduced to the extent of [the distributions allocable to principal and] any
Realized Losses allocable hereto.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without


                                      B-1-3

<PAGE>



limitation reimbursement to the Trustee, the Company and the Master Servicer of
advances made, or certain expenses incurred, by either of them.

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

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

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

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

         The Company, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Company, the
Master Servicer, the Trustee nor any such agent shall be affected by notice to
the contrary.

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.



                                      B-1-4

<PAGE>



         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Holder of at least 50.01% Percentage Interest in the
Class C Certificates (the "Majority Class C Certificateholder") from the Trust
Fund of all remaining Mortgage Loans and each REO Property in respect thereof
remaining in the Trust Fund, thereby effecting early retirement of the
Certificates and (ii) the final payment or other liquidation (or any Advance
with respect thereto) of the last Mortgage Loan remaining in the Trust Fund (or
the disposition of all REO Property in respect thereof). The Agreement permits,
but does not require, the Majority Class C Certificateholder to purchase at a
price determined as provided in the Agreement all remaining Mortgage Loans and
all REO Property; provided, that any such option may only be exercised if the
aggregate Stated Principal Balance of the Mortgage Loans as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the aggregate Stated Principal Balance of the Mortgage Loans at
the Cut-off Date.

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


                                      B-1-5

<PAGE>



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

Dated:  April__, 2001                   BANKERS TRUST COMPANY OF
                                        CALIFORNIA, N.A.,
                                         as Trustee


                                        By:
                                           -----------------------------
                                              Authorized Signatory




                          CERTIFICATE OF AUTHENTICATION

         This is one of the Class [M-__][B] Certificates referred to in the
within-mentioned Agreement.

                                          BANKERS TRUST COMPANY OF
                                          CALIFORNIA, N.A.,
                                           as Trustee


                                          By:
                                                        Authorized Signatory


                                      B-1-6

<PAGE>


                                   ASSIGNMENT


                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto ----------------------------- (Please print or typewrite
name address including postal zip code of assignee) a Percentage Interest
evidenced by the within Mortgage Pass-Through Certificate and hereby authorizes
the transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:-----------------------------

-------------------------------------------------------------------------------




Dated:                           ----------------------------------------------
                                    Signature by or on behalf of assignor



                                        -----------------------------
                                           Signature Guaranteed







                                      B-1-7

<PAGE>




                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

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

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


                                      B-1-8

<PAGE>



                                   EXHIBIT B-2

                          FORM OF CLASS C CERTIFICATES

         THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A,
CLASS M-1, CLASS M-2 AND CLASS B CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS
DEFINED BELOW).

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

         THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

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



                                      B-2-1

<PAGE>




Certificate No. 1
Class C                                Aggregate Initial Notional Amount of the
                                       Class C Certificates:
                                       $____________
Date of Pooling and Servicing          Initial Notional Amount
Agreement and Cut-off Date:            of this Certificate ("Denomination"):
April 1, 2001                          $____________
First Distribution Date:               Initial Certificate Principal Balance of
May 25, 2001                           this Certificate ("Denomination":
                                       $_________
Master Servicer:                       CUSIP:
Impac Funding Corporation
Assumed Final Distribution Date:       Percentage Interest of this Certificate:
April 25, 2031                         100.00%

                        MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2001-3

         evidencing a percentage interest in the distributions allocable to the
         Class C Certificates with respect to a Trust Fund consisting primarily
         of a pool of conforming one- to four-family fixed-rate first lien
         mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, the Master Servicer or any of their affiliates
will have any obligation with respect to any certificate or other obligation
secured by or payable from payments on the Certificates.

         This certifies that ____________ is the registered owner of the
Percentage Interest evidenced by this Class C Certificate (obtained by dividing
the Denomination of this Class C Certificate by the Original Class Certificate
Principal Balance) in certain distributions with respect to a Trust consisting
primarily of the Mortgage Loans deposited by Impac Secured Assets Corp. (the
"Company"). The Trust was created pursuant to a Pooling and Servicing Agreement
dated as of April 1, 2001 (the "Agreement") among the Company, Impac Funding
Corporation, as master servicer (the "Master Servicer"), and Bankers Trust
Company of California, N.A., as Trustee (the "Trustee"). To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Class C Certificate is issued under and is subject to the
terms,


                                      B-2-2

<PAGE>



provisions and conditions of the Agreement, to which Agreement the Holder of
this Class C Certificate by virtue of the acceptance hereof assents and by which
such Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing as
described in the Agreement, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date (the "Record Date"),
from the Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount (of interest
and principal, if any) required to be distributed to Holders of Class C
Certificates on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or by check mailed to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register.

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

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without limitation
reimbursement to the Trustee, the Company and the Master Servicer of advances
made, or certain expenses incurred, by either of them.

         No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under said Act and such laws. In the event that a transfer


                                      B-2-3

<PAGE>



is to be made in reliance upon an exemption from the Act and such laws, in order
to assure compliance with the Act and such laws, the Certificateholder desiring
to effect such transfer and such Certificateholder's prospective transferee
shall each certify to the Trustee and the Company in writing the facts
surrounding the transfer. In the event that such a transfer is not to be made
pursuant to Rule 144A of the Act, there shall be delivered to the Trustee and
the Company of an Opinion of Counsel that such transfer may be made pursuant to
an exemption from the Act, which Opinion of Counsel shall not be obtained at the
expense of the Trustee, the Master Servicer or the Company; or there shall be
delivered to the Trustee and the Company a transferor certificate by the
transferor and an investment letter shall be executed by the transferee. The
Holder hereof desiring to effect such transfer shall, and does hereby agree to,
indemnify the Trustee and the Company against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.

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

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

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

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


                                      B-2-4

<PAGE>



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

         The Company, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Company, the
Master Servicer, the Trustee nor any such agent shall be affected by notice to
the contrary.

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Holder of at least 50.01% Percentage Interest in the
Class C Certificates (the "Majority Class C Certificateholder") from the Trust
Fund of all remaining Mortgage Loans and each REO Property in respect thereof
remaining in the Trust Fund, thereby effecting early retirement of the
Certificates and (ii) the final payment or other liquidation (or any Advance
with respect thereto) of the last Mortgage Loan remaining in the Trust Fund (or
the disposition of all REO Property in respect thereof). The Agreement permits,
but does not require, the Majority Class C Certificateholder to purchase at a
price determined as provided in the Agreement all remaining Mortgage Loans and
all REO Property; provided, that any such option may only be exercised if the
aggregate Stated Principal Balance of the Mortgage Loans as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the aggregate Stated Principal Balance of the Mortgage Loans at
the Cut-off Date.

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




                                      B-2-5

<PAGE>



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


Dated:  April__, 2001                      BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.,
                                           as Trustee



                                           By:
                                              ----------------------------------
                                                Authorized Signatory



                                           CERTIFICATE OF AUTHENTICATION

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

                                           BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.,
                                           as Trustee


                                           By:
                                              ----------------------------------
                                                Authorized Signatory



                                      B-2-6

<PAGE>



                                   ASSIGNMENT


                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto ----------------------------- (Please print or typewrite
name address including postal zip code of assignee) a Percentage Interest
evidenced by the within Mortgage Pass-Through Certificate and hereby authorizes
the transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:-----------------------------

-------------------------------------------------------------------------------




Dated:                           ----------------------------------------------
                                    Signature by or on behalf of assignor



                                        -----------------------------
                                           Signature Guaranteed




                                      B-2-7

<PAGE>




                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

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

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




                                      B-2-8

<PAGE>



                                   EXHIBIT B-3

                           FORM OF CLASS P CERTIFICATE

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

         THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"). ANY RESALE OR TRANSFER OF THIS CERTIFICATE WITHOUT
REGISTRATION THEREOF UNDER THE ACT MAY ONLY BE MADE IN A TRANSACTION EXEMPTED
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH THE
PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.

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




                                      B-2-9

<PAGE>




Certificate No. 1
Class P                                Aggregate Initial Certificate Principal
                                       Balance of the Class P Certificates:
                                       $100.00
Date of Pooling and Servicing          Initial Certificate Principal Balance
Agreement and Cut-off Date:            of this Certificate ("Denomination"):
April 1, 2001                          $100.00
First Distribution Date:               Percentage Interest of this Certificate:
May 25, 2001                           100.00%
Master Servicer:
Impac Funding Corporation              CUSIP:
Assumed Final Distribution Date:
April 25, 2031

                        MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2001-3
                                     Class P

         evidencing a percentage interest in any distributions allocable to the
         Class P Certificates with respect to the Trust Fund consisting
         primarily of a pool of one- to four-family fixed-rate first lien
         mortgage loans formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, the Master Servicer or any of their affiliates
will have any obligation with respect to any certificate or other obligation
secured by or payable from payments on the Certificates.

         This certifies that _________________ is the registered owner of the
Percentage Interest evidenced by this Class P Certificate (obtained by dividing
the Denomination of this Class P Certificate by the Original Class Certificate
Principal Balance) in certain distributions with respect to a Trust Fund
consisting primarily of a pool of one- to four-family fixed-rate first lien
mortgage loans (the "Mortgage Loans"), formed and sold by Impac Secured Assets
Corp. (hereinafter called the "Company," which term includes any successor
entity under the Agreement referred to below). The Trust Fund was created
pursuant to a Pooling and Servicing Agreement dated as specified above (the
"Agreement") among the Company, the Master Servicer and Bankers Trust Company of
California, N.A., as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which


                                     B-2-10

<PAGE>



is set forth hereafter. To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.

         Pursuant to the terms of the Agreement, a distribution will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing as
described in the Agreement, to the Person in whose name this Certificate is
registered at the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date (the "Record Date"),
from the Available Distribution Amount in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount (of Prepayment
Charges and principal, if any) required to be distributed to Holders of Class P
Certificates on such Distribution Date.

         Distributions on this Certificate will be made either by the Trustee or
by a Paying Agent appointed by the Trustee either in immediately available funds
(by wire transfer or otherwise) for the account of the Person entitled thereto
if such Person shall have so notified the Trustee or such Paying Agent at least
5 Business Days prior to the related Record Date, or by check mailed to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register.

         Notwithstanding the above, the final distribution on this Certificate
will be made after due notice of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose in the City and State of New York. The Initial
Certificate Principal Balance of this Certificate is set forth above. The
Certificate Principal Balance hereof will be reduced to the extent of the
distributions allocable to principal allocable hereto.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         The Certificates are limited in right of payment to certain collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. In the event Master Servicer funds are advanced
with respect to any Mortgage Loan, such advance is reimbursable to the Master
Servicer, to the extent provided in the Agreement, from related recoveries on
such Mortgage Loan or from other cash that would have been distributable to
Certificateholders.

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without limitation
reimbursement to the Trustee, the Company and the Master Servicer of advances
made, or certain expenses incurred, by either of them.


                                     B-2-11

<PAGE>



         No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under said Act and such laws. In the event that a transfer is to be
made in reliance upon an exemption from the Act and such laws, in order to
assure compliance with the Act and such laws, the Certificateholder desiring to
effect such transfer and such Certificateholder's prospective transferee shall
each certify to the Trustee and the Company in writing the facts surrounding the
transfer. In the event that such a transfer is not to be made pursuant to Rule
144A of the Act, there shall be delivered to the Trustee and the Company of an
Opinion of Counsel that such transfer may be made pursuant to an exemption from
the Act, which Opinion of Counsel shall not be obtained at the expense of the
Trustee, the Master Servicer or the Company; or there shall be delivered to the
Trustee and the Company a transferor certificate by the transferor and an
investment letter shall be executed by the transferee. The Holder hereof
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee and the Company against any liability that may result if the transfer is
not so exempt or is not made in accordance with such federal and state laws.

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

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

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

         The Certificates are issuable only as registered Certificates without
coupons in Classes and in denominations specified in the Agreement. As provided
in the Agreement and subject to certain


                                     B-2-12

<PAGE>



limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denominations evidencing the same Class and aggregate
Percentage Interest, as requested by the Holder surrendering the same.

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

         The Company, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Company, the
Master Servicer, the Trustee nor any such agent shall be affected by notice to
the contrary.

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Holder of at least 50.01% Percentage Interest in the
Class C Certificates (the "Majority Class C Certificateholder") from the Trust
Fund of all remaining Mortgage Loans and each REO Property in respect thereof
remaining in the Trust Fund, thereby effecting early retirement of the
Certificates and (ii) the final payment or other liquidation (or any Advance
with respect thereto) of the last Mortgage Loan remaining in the Trust Fund (or
the disposition of all REO Property in respect thereof). The Agreement permits,
but does not require, the Majority Class C Certificateholder to purchase at a
price determined as provided in the Agreement all remaining Mortgage Loans and
all REO Property; provided, that any such option may only be exercised if the
aggregate Stated Principal Balance of the Mortgage Loans as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the aggregate Stated Principal Balance of the Mortgage Loans at
the Cut-off Date.

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




                                     B-2-13

<PAGE>



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


Dated:  April__, 2001                      BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.,
                                           as Trustee



                                           By:
                                              ---------------------------------
                                              Authorized Signatory



                          CERTIFICATE OF AUTHENTICATION

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

                                           BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.,
                                           as Trustee


                                           By:
                                              ---------------------------------
                                              Authorized Signatory



                                     B-2-14

<PAGE>



                                   ASSIGNMENT


                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto ----------------------------- (Please print or typewrite
name address including postal zip code of assignee) a Percentage Interest
evidenced by the within Mortgage Pass-Through Certificate and hereby authorizes
the transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:-----------------------------

-------------------------------------------------------------------------------




Dated:                           ----------------------------------------------
                                    Signature by or on behalf of assignor



                                        -----------------------------
                                           Signature Guaranteed




                            B-2-15

<PAGE>




                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

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

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





                                     B-2-16

<PAGE>



                                   EXHIBIT B-4

                           FORM OF CLASS R CERTIFICATE

         THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED
STATES PERSON OR A DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).

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

         NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 5.02(E) OF THE
AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE MASTER SERVICER, THE
COMPANY AND THE TRUSTEE THAT THE PURCHASE OF THIS CERTIFICATE IS PERMISSIBLE
UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE
MASTER SERVICER, THE COMPANY OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY IN
ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND SERVICING AGREEMENT (THE
"AGREEMENT").

         THIS CLASS R CERTIFICATE HAS NO PRINCIPAL BALANCE, DOES NOT BEAR
INTEREST AND WILL NOT RECEIVE ANY DISTRIBUTIONS EXCEPT AS PROVIDED HEREIN.

         ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER
SERVICER AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES,
ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE, (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C) BEING HEREIN
REFERRED TO AS A "DISQUALIFIED ORGANIZATION") OR (D) AN AGENT OF A


                                     B-2-17

<PAGE>



DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE
ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES CERTAIN
ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL
BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT
BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT
NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF
THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE
CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.


                                     B-2-18

<PAGE>



Certificate No. 1

Class R Senior

Date of Pooling and Servicing
Agreement and Cut-off Date:
April 1, 2001                             Percentage Interest: 100.00%

First Distribution Date:
May 25, 2001
                                          CUSIP:
Master Servicer:
Impac Funding Corporation

Assumed Final Distribution Date:
April 25, 2031


                       MORTGAGE PASS-THROUGH CERTIFICATE,
                                  SERIES 2001-3

         evidencing a percentage interest in any distributions allocable to the
         Class R Certificates with respect to a Trust Fund consisting primarily
         of a pool of one- to four- family fixed-rate first lien mortgage loans
         formed and sold by IMPAC SECURED ASSETS CORP.

         This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Impac Secured Assets
Corp., the Master Servicer, the Trustee referred to below or any of their
affiliates. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality or by Impac
Secured Assets Corp., the Master Servicer, the Trustee or any of their
affiliates. None of the Company, the Master Servicer or any of their affiliates
will have any obligation with respect to any certificate or other obligation
secured by or payable from payments on the Certificates.

         This certifies that ______________________ is the registered owner of
the Percentage Interest evidenced by this Certificate stated above in certain
distributions with respect to a Trust Fund, consisting primarily of a pool of
one- to four-family fixed-rate first lien mortgage loans (the "Mortgage Loans"),
formed and sold by Impac Secured Assets Corp. (hereinafter called the "Company,"
which term includes any successor entity under the Agreement referred to below).
The Trust Fund was created pursuant to a Pooling and Servicing Agreement dated
as specified above (the "Agreement") among the Company, the Master Servicer and
Bankers Trust Company of California, N.A., as trustee (the "Trustee"), a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings


                                     B-2-19

<PAGE>



assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.

         This Certificate does not have a principal balance or pass-through rate
and will be entitled to distributions only to the extent set forth in the
Agreement. In addition, any distribution of the proceeds of any remaining assets
of the Trust will be made only upon presentment and surrender of this
Certificate at the Corporate Trust Office or the office or agency maintained by
the Trustee in California.

         This Certificate is one of a duly authorized issue of Certificates
issued in several Classes designated as Mortgage Pass-Through Certificates of
the Series specified hereon (herein collectively called the "Certificates").

         As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the Master Servicer from time to time for purposes other than
distributions to Certificateholders, such purposes including without limitation
reimbursement to the Trustee, the Company and the Master Servicer of advances
made, or certain expenses incurred, by either of them.

         No transfer of a Certificate of this Class shall be made unless such
transfer is made pursuant to an effective registration statement under the Act
and any applicable state securities laws or is exempt from the registration
requirements under said Act and such laws. In the event that a transfer is to be
made in reliance upon an exemption from the Act and such laws, in order to
assure compliance with the Act and such laws, the Certificateholder desiring to
effect such transfer and such Certificateholder's prospective transferee shall
each certify to the Trustee and the Company in writing the facts surrounding the
transfer. In the event that such a transfer is not to be made pursuant to Rule
144A of the Act, there shall be delivered to the Trustee and the Company of an
Opinion of Counsel that such transfer may be made pursuant to an exemption from
the Act, which Opinion of Counsel shall not be obtained at the expense of the
Trustee, the Master Servicer or the Company; or there shall be delivered to the
Trustee and the Company a transferor certificate by the transferor and an
investment letter shall be executed by the transferee. The Holder hereof
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee and the Company against any liability that may result if the transfer is
not so exempt or is not made in accordance with such federal and state laws.

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

         Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions of the Agreement, including but not limited to the
restrictions that (i) each person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee, (ii) no


                                     B-2-20

<PAGE>



Ownership Interest in this Certificate may be transferred without delivery to
the Trustee of (a) a transfer affidavit of the proposed transferee and (b) a
transfer certificate of the transferor, each of such documents to be in the form
described in the Agreement, (iii) each person holding or acquiring any Ownership
Interest in this Certificate must agree to require a transfer affidavit and to
deliver a transfer certificate to the Trustee as required pursuant to the
Agreement, (iv) each person holding or acquiring an Ownership Interest in this
Certificate must agree not to transfer an Ownership Interest in this Certificate
if it has actual knowledge that the proposed transferee is not a Permitted
Transferee and (v) any attempted or purported transfer of any Ownership Interest
in this Certificate in violation of such restrictions will be absolutely null
and void and will vest no rights in the purported transferee. Pursuant to the
Agreement, The Trustee will provide the Internal Revenue Service and any
pertinent persons with the information needed to compute the tax imposed under
the applicable tax laws on transfers of residual interests to disqualified
organizations, if any person other than a Permitted Transferee acquires an
Ownership Interest on a Class R Certificate in violation of the restrictions
mentioned above.

         The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Company, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the Certificate. The Agreement also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain additional circumstances, without the
consent of the Holders of certain Classes of Certificates.

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

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



                                     B-2-21

<PAGE>



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

         The Company, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Company, the
Master Servicer, the Trustee nor any such agent shall be affected by notice to
the contrary.

         This Certificate shall be governed by and construed in accordance with
the laws of the State of New York.

         The obligations created by the Agreement in respect of the Certificates
and the Trust Fund created thereby shall terminate upon the payment to
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the earlier of
(i) the purchase by the Holder of at least 50.01% Percentage Interest in the
Class C Certificates (the "Majority Class C Certificateholder") from the Trust
Fund of all remaining Mortgage Loans and each REO Property in respect thereof
remaining in the Trust Fund, thereby effecting early retirement of the
Certificates and (ii) the final payment or other liquidation (or any Advance
with respect thereto) of the last Mortgage Loan remaining in the Trust Fund (or
the disposition of all REO Property in respect thereof). The Agreement permits,
but does not require, the Majority Class C Certificateholder to purchase at a
price determined as provided in the Agreement all remaining Mortgage Loans and
all REO Property; provided, that any such option may only be exercised if the
aggregate Stated Principal Balance of the Mortgage Loans as of the Distribution
Date upon which the proceeds of any such purchase are distributed is less than
ten percent of the aggregate Stated Principal Balance of the Mortgage Loans at
the Cut-off Date.

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




                                     B-2-22

<PAGE>



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

Dated: April__, 2001                       BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.,
                                           as Trustee


                                           By:
                                              ---------------------------------
                                              Authorized Signatory



                          CERTIFICATE OF AUTHENTICATION

         This is one of the Class [R-I][R-II] Certificates referred to in the
within-mentioned Agreement.

                                           BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.,
                                           as Trustee


                                           By:
                                              ---------------------------------
                                              Authorized Signatory

                                     B-2-23

<PAGE>



                                   ASSIGNMENT


                  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto ----------------------------- (Please print or typewrite
name address including postal zip code of assignee) a Percentage Interest
evidenced by the within Mortgage Pass-Through Certificate and hereby authorizes
the transfer of registration of such interest to assignee on the Certificate
Register of the Trust Fund.

                  I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:-----------------------------

-------------------------------------------------------------------------------




Dated:                           ----------------------------------------------
                                    Signature by or on behalf of assignor



                                        -----------------------------
                                           Signature Guaranteed




                                     B-2-24

<PAGE>




                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

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

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





                                     B-2-25

<PAGE>



                                    EXHIBIT C

                     FORM OF TRUSTEE'S INITIAL CERTIFICATION



                                              April___, 2001


Impac Funding Corporation
1401 Dove Street
Newport Beach, California 92660

         Re:      Pooling and Servicing Agreement, dated as of April 1, 2001
                  among Impac Secured Assets Corp., Impac Funding Corporation,
                  and Bankers Trust Company of California, N.A., Mortgage
                  Pass-Through Certificates, Series 2001-3
                  ------------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.02 of the above-captioned Pooling
and Servicing Agreement, the undersigned, as Trustee, hereby certifies that as
to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or listed on the attachment hereto) it has reviewed
the Mortgage File and the Mortgage Loan Schedule and has determined that: (i)
all documents required to be included in the Mortgage File are in its
possession; (ii) such documents have been reviewed by it and appear regular on
their face and relate to such Mortgage Loan; and (iii) based on examination by
it, and only as to such documents, the information set forth in items (i), (ii),
(iii) and (iv) of the definition or description of "Mortgage Loan Schedule" is
correct.

                  The Trustee has made no independent examination of any
documents contained in each Mortgage File beyond the review specifically
required in the above-referenced Pooling and Servicing Agreement. The Trustee
makes no representation that any documents specified in clause (vi) of Section
2.01 should be included in any Mortgage File. The Trustee makes no
representations as to and shall not be responsible to verify: (i) the validity,
legality, sufficiency, enforceability, due authorization, recordability or
genuineness of any of the documents contained in each Mortgage File of any of
the Mortgage Loans identified on the Mortgage Loan Schedule, (ii) the
collectability, insurability, effectiveness or suitability of any such Mortgage
Loan, or (iii) the existence of any assumption, modification, written assurance
or substitution agreement with respect to any Mortgage File if no such documents
appear in the Mortgage File delivered to the Trustee.



<PAGE>



                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Pooling and
Servicing Agreement.


                                           BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.



                                           By:
                                              -----------------------------
                                           Name:
                                           Title:



                                       C-2

<PAGE>



                                    EXHIBIT D

                       FORM OF TRUSTEE FINAL CERTIFICATION

                                           __________ ____, 2001

Impac Funding Corporation
1401 Dove Street
Newport Beach, California 92660

         Re:      Pooling and Servicing Agreement, dated as of April 1, 2001
                  among Impac Secured Assets Corp., Impac Funding Corporation,
                  and Bankers Trust Company of California, N.A., Mortgage
                  Pass-Through Certificates, Series 2001-3
                  ------------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.02 of the above-captioned Pooling
and Servicing Agreement, the undersigned, as Trustee, hereby certifies that as
to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or listed on the attachment hereto) it has received
the documents set forth in Section 2.01.

                  The Trustee has made no independent examination of any
documents contained in each Mortgage File beyond the review specifically
required in the above-referenced Pooling and Servicing Agreement. The Trustee
makes no representation that any documents specified in clause (vi) of Section
2.01 should be included in any Mortgage File. The Trustee makes no
representations as to and shall not be responsible to verify: (i) the validity,
legality, sufficiency, enforceability, due authorization, recordability or
genuineness of any of the documents contained in each Mortgage File of any of
the Mortgage Loans identified on the Mortgage Loan Schedule, (ii) the
collectability, insurability, effectiveness or suitability of any such Mortgage
Loan or (iii) the existence of any assumption, modification, written assurance
or substitution agreement with respect to any Mortgage File if no such documents
appear in the Mortgage File delivered to the Trustee.

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Pooling and
Servicing Agreement.

                                           BANKERS TRUST COMPANY OF
                                           CALIFORNIA, N.A.

                                           By:
                                           Name:
                                           Title:


                                       D-1

<PAGE>



                                    EXHIBIT E

                            FORM OF REMITTANCE REPORT

                             (Provided Upon Request)



                                       E-1

<PAGE>



                                   EXHIBIT F-1

                               REQUEST FOR RELEASE
                                  (for Trustee)

Loan Information

              Name of Mortgagor:      _____________________________

              Master Servicer
              Loan No.:               _____________________________

Trustee

              Name:                   _____________________________

              Address:                _____________________________

                                      _____________________________

              Trustee
              Mortgage File No.:      _____________________________


Request for Requesting Documents (check one):

1.            Mortgage Loan Liquidated.
                       (The Master Servicer hereby certifies that all proceeds
                       of foreclosure, insurance or other liquidation have been
                       finally received and deposited into the Custodial Account
                       to the extent required pursuant to the Pooling and
                       Servicing Agreement.)

2.            Mortgage Loan in Foreclosure.

3.            Mortgage Loan Repurchased Pursuant to Section 9.01 of the Pooling
              and Servicing Agreement.

4.            Mortgage Loan Repurchased Pursuant to Article II of the Pooling
              and Servicing Agreement.
                       (The Master Servicer hereby certifies that the repurchase
                       price has been deposited into the Custodial Account
                       pursuant to the Pooling and Servicing Agreement.)



                                      F-1-1

<PAGE>



5.            Other (explain).








              The undersigned Master Servicer hereby acknowledges that it has
received from the Trustee for the Holders of Mortgage Pass-Through Certificates,
Series 2001-3, the documents referred to below (the "Documents"). All
capitalized terms not otherwise defined in this Request for Release shall have
the meanings given them in the Pooling and Servicing Agreement, dated as of
April 1, 2001 (the "Pooling and Servicing Agreement"), among Impac Secured
Assets Corp., Impac Funding Corporation and the Trustee.

( )           Promissory Note dated _______________, 200__, in the original
              principal sum of $__________, made by _____________________,
              payable to, or endorsed to the order of, the Trustee.

( )           Mortgage recorded on _____________________ as instrument no.
              ____________________ in the County Recorder's Office of the County
              of _________________, State of __________________ in
              book/reel/docket _________________ of official records at
              page/image _____________.

( )           Deed of Trust recorded on ___________________ as instrument no.
              ________________ in the County Recorder's Office of the County of
              _________________, State of __________________ in book/reel/docket
              _________________ of official records at page/image
              ______________.

( )           Assignment of Mortgage or Deed of Trust to the Trustee, recorded
              on ___________________ as instrument no. _________ in the County
              Recorder's Office of the County of __________, State of
              _______________ in book/reel/docket ____________ of official
              records at page/image ____________.

( )           Other documents, including any amendments, assignments or other
              assumptions of the Mortgage Note or Mortgage.

              ( )      _____________________________________________

              ( )      _____________________________________________

              ( )      _____________________________________________


                                      F-1-2

<PAGE>



              ( )      _____________________________________________

              The undersigned Master Servicer hereby acknowledges and agrees as
follows:

                       (1) The Master Servicer shall hold and retain possession
              of the Documents in trust for the benefit of the Trustee, solely
              for the purposes provided in the Agreement.

                       (2) The Master Servicer shall not cause or knowingly
              permit the Documents to become subject to, or encumbered by, any
              claim, liens, security interest, charges, writs of attachment or
              other impositions nor shall the Master Servicer assert or seek to
              assert any claims or rights of setoff to or against the Documents
              or any proceeds thereof.

                       (3) The Master Servicer shall return each and every
              Document previously requested from the Mortgage File to the
              Custodian when the need therefor no longer exists, unless the
              Mortgage Loan relating to the Documents has been liquidated and
              the proceeds thereof have been remitted to the Custodial Account
              and except as expressly provided in the Agreement.

                       (4) The Documents and any proceeds thereof, including any
              proceeds of proceeds, coming into the possession or control of the
              Master Servicer shall at all times be earmarked for the account of
              the Trustee, and the Master Servicer shall keep the Documents and
              any proceeds separate and distinct from all other property in the
              Master Servicer's possession, custody or control.

                                           IMPAC FUNDING CORPORATION

                                           By:

                                           Title:



Date: _____________________, 200__


                                      F-1-3

<PAGE>



                                   EXHIBIT F-2

                               REQUEST FOR RELEASE
                          [Mortgage Loans Paid in Full]

                     OFFICER'S CERTIFICATE AND TRUST RECEIPT
                       MORTGAGE PASS-THROUGH CERTIFICATES
                                  SERIES 2001-3


______________________________________ HEREBY CERTIFIES THAT HE/SHE IS AN
OFFICER OF THE MASTER SERVICER, HOLDING THE OFFICE SET FORTH BENEATH HIS/HER
SIGNATURE, AND HEREBY FURTHER CERTIFIES AS FOLLOWS:

WITH RESPECT TO THE MORTGAGE LOANS, AS THE TERM IS DEFINED IN THE POOLING AND
SERVICING AGREEMENT DESCRIBED IN THE ATTACHED SCHEDULE:

ALL PAYMENTS OF PRINCIPAL, PREMIUM (IF ANY), AND INTEREST HAVE BEEN
MADE.

LOAN NUMBER:  _______________          BORROWER'S NAME:_____________

COUNTY:_____________________

WE HEREBY CERTIFY THAT ALL AMOUNTS RECEIVED IN CONNECTION WITH SUCH PAYMENTS,
WHICH ARE REQUIRED TO BE DEPOSITED IN THE CUSTODIAL ACCOUNT PURSUANT TO SECTION
3.10 OF THE POOLING AND SERVICING AGREEMENT, HAVE BEEN OR WILL BE CREDITED.

___________       ______________________            DATED:______________

/ /      VICE PRESIDENT

/ /      ASSISTANT VICE PRESIDENT


                                      F-2-1

<PAGE>



                                   EXHIBIT G-1

                     FORM OF INVESTOR REPRESENTATION LETTER


                               __________, 200___


Impac Secured Assets Corp.
1401 Dove Street
Newport Beach, California 92660

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

Attention: Impac Secured Assets Corp. Series 2001-3

          Re:      Impac Secured Assets Corp.
                   Mortgage Pass-Through Certificates, Series 2001-3, Class ___
                   ------------------------------------------------------------

Ladies and Gentlemen:

         __________ (the "Purchaser") intends to purchase from __________ (the
"Seller") $__________ Initial Certificate Principal Balance of Mortgage
Pass-Through Certificates, Series 2001-3, Class ____ (the "Certificates"),
issued pursuant to the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of April 1, 2001 among Impac Secured Assets
Corp., as company (the "Company"), Impac Funding Corporation, as master servicer
and Bankers Trust Company of California, N.A., as trustee (the "Trustee"). All
terms used herein and not otherwise defined shall have the meanings set forth in
the Pooling and Servicing Agreement. The Purchaser hereby certifies, represents
and warrants to, and covenants with, the Company and the Trustee that:

                           1. The Purchaser understands that (a) the
                  Certificates have not been and will not be registered or
                  qualified under the Securities Act of 1933, as amended (the
                  "Act") or any state securities law, (b) the Company is not
                  required to so register or qualify the Certificates, (c) the
                  Certificates may be resold only if registered and qualified
                  pursuant to the provisions of the Act or any state securities
                  law, or if an exemption from such registration and
                  qualification is available, (d) the Pooling and Servicing
                  Agreement contains restrictions regarding the transfer of the
                  Certificates and (e) the Certificates will bear a legend to
                  the foregoing effect.



                                      G-1-1

<PAGE>



                           2. The Purchaser is acquiring the Certificates for
                  its own account for investment only and not with a view to or
                  for sale in connection with any distribution thereof in any
                  manner that would violate the Act or any applicable state
                  securities laws.

                           3. The Purchaser is (a) a substantial, sophisticated
                  institutional investor having such knowledge and experience in
                  financial and business matters, and, in particular, in such
                  matters related to securities similar to the Certificates,
                  such that it is capable of evaluating the merits and risks of
                  investment in the Certificates, (b) able to bear the economic
                  risks of such an investment and (c) an "accredited investor"
                  within the meaning of Rule 501(a) promulgated pursuant to the
                  Act.

                           4. The Purchaser has been furnished with, and has had
                  an opportunity to review (a) [a copy of the Private Placement
                  Memorandum, dated April 30, 2001, relating to the Certificates
                  (b)] a copy of the Pooling and Servicing Agreement and [(b)]
                  [(c)] such other information concerning the Certificates, the
                  Mortgage Loans and the Company as has been requested by the
                  Purchaser from the Company or the Seller and is relevant to
                  the Purchaser's decision to purchase the Certificates. The
                  Purchaser has had any questions arising from such review
                  answered by the Company or the Seller to the satisfaction of
                  the Purchaser. [If the Purchaser did not purchase the
                  Certificates from the Seller in connection with the initial
                  distribution of the Certificates and was provided with a copy
                  of the Private Placement Memorandum (the "Memorandum")
                  relating to the original sale (the "Original Sale") of the
                  Certificates by the Company, the Purchaser acknowledges that
                  such Memorandum was provided to it by the Seller, that the
                  Memorandum was prepared by the Company solely for use in
                  connection with the Original Sale and the Company did not
                  participate in or facilitate in any way the purchase of the
                  Certificates by the Purchaser from the Seller, and the
                  Purchaser agrees that it will look solely to the Seller and
                  not to the Company with respect to any damage, liability,
                  claim or expense arising out of, resulting from or in
                  connection with (a) error or omission, or alleged error or
                  omission, contained in the Memorandum, or (b) any information,
                  development or event arising after the date of the
                  Memorandum.]

                           5. The Purchaser has not and will not nor has it
                  authorized or will it authorize any person to (a) offer,
                  pledge, sell, dispose of or otherwise transfer any
                  Certificate, any interest in any Certificate or any other
                  similar security to any person in any manner, (b) solicit any
                  offer to buy or to accept a pledge, disposition of other
                  transfer of any Certificate, any interest in any Certificate
                  or any other similar security from any person in any manner,
                  (c) otherwise approach or negotiate with respect to any
                  Certificate, any interest in any Certificate or any other
                  similar security with any person in any manner, (d) make any
                  general solicitation by means of general advertising or in any
                  other manner or (e) take any other action, that (as to any of
                  (a) through (e) above) would constitute a distribution of any
                  Certificate under the Act,


                                      G-1-2

<PAGE>



                  that would render the disposition of any Certificate a
                  violation of Section 5 of the Act or any state securities law,
                  or that would require registration or qualification pursuant
                  thereto. The Purchaser will not sell or otherwise transfer any
                  of the Certificates, except in compliance with the provisions
                  of the Pooling and Servicing Agreement.


                                           Very truly yours,

                                           ------------------------------
                                           (Purchaser)

                                           By:
                                              ---------------------------
                                           Name:
                                                -------------------------
                                           Title:
                                                 ------------------------


                                      G-1-3

<PAGE>



                                   EXHIBIT G-2

                    FORM OF TRANSFEROR REPRESENTATION LETTER




                                            __________, 200___

Impac Secured Assets Corp.
1401 Dove Street
Newport Beach, California 92660

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

Attention: Impac Secured Assets Corp. Series 2001-3

           Re:      Impac Secured Assets Corp.
                    Mortgage Pass-Through Certificates, Series 2001-3, Class ___
                    ------------------------------------------------------------

Ladies and Gentlemen:

         In connection with the sale by __________ (the "Seller") to __________
(the "Purchaser") of $__________ Initial Certificate Principal Balance of
Mortgage Pass-Through Certificates, Series 2001-3, Class ____ (the
"Certificates"), issued pursuant to the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of April 1, 2001 among Impac
Secured Assets Corp., as company (the "Company"), Impac Funding Corporation, as
master servicer and Bankers Trust Company of California, N.A., as trustee (the
"Trustee"). The Seller hereby certifies, represents and warrants to, and
covenants with, the Company and the Trustee that:

         Neither the Seller nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred any Certificate, any
interest in any Certificate or any other similar security to any person in any
manner, (b) has solicited any offer to buy or to accept a pledge, disposition or
other transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner, or
(e) has taken any other action, that (as to any of (a) through (e) above) would
constitute a distribution of the Certificates under the Securities Act of 1933
(the "Act"), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Seller will not act in any
manner set forth in the


                                      G-2-1

<PAGE>



foregoing sentence with respect to any Certificate. The Seller has not and will
not sell or otherwise transfer any of the Certificates, except in compliance
with the provisions of the Pooling and Servicing Agreement.

                                     Very truly yours,

                                     -----------------------------------
                                     (Seller)



                                     By:
                                        ---------------------------
                                     Name:
                                          -------------------------
                                     Title:
                                           ------------------------




                                      G-2-2

<PAGE>



                                   EXHIBIT G-3

                   FORM OF RULE 144A INVESTMENT REPRESENTATION


                              Description of Rule 144A Securities, including
numbers:

                           Impac Secured Assets Corp.
                       Mortgage Pass-Through Certificates
                        Series 2001-3, Class ___, No. ___


                  The undersigned seller, as registered holder (the
"Transferor"), intends to transfer the Rule 144A Securities described above to
the undersigned buyer (the "Buyer").

                  1. In connection with such transfer and in accordance with the
agreements pursuant to which the Rule 144A Securities were issued, the
Transferor hereby certifies the following facts: Neither the Transferor nor
anyone acting on its behalf has offered, transferred, pledged, sold or otherwise
disposed of the Rule 144A Securities, any interest in the Rule 144A Securities
or any other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Rule 144A Securities, or otherwise
approached or negotiated with respect to the Rule 144A Securities, any interest
in the Rule 144A Securities or any other similar security with, any person in
any manner, or made any general solicitation by means of general advertising or
in any other manner, or taken any other action, which would constitute a
distribution of the Rule 144A Securities under the Securities Act of 1933, as
amended (the "1933 Act"), or which would render the disposition of the Rule 144A
Securities a violation of Section 5 of the 1933 Act or require registration
pursuant thereto, and that the Transferor has not offered the Rule 144A
Securities to any person other than the Buyer or another "qualified
institutional buyer" as defined in Rule 144A under the 1933 Act.

                  2. The Buyer warrants and represents to, and covenants with,
the Transferor, the Trustee and the Master Servicer pursuant to Section 5.02 of
the Pooling and Servicing Agreement as follows:

                           a. The Buyer understands that the Rule 144A
         Securities have not been registered under the 1933 Act or the
         securities laws of any state.

                           b. The Buyer considers itself a substantial,
         sophisticated institutional investor having such knowledge and
         experience in financial and business matters that it is capable of
         evaluating the merits and risks of investment in the Rule 144A
         Securities.

                           c. The Buyer has been furnished with all information
         regarding the Rule 144A Securities that it has requested from the
         Transferor, the Trustee or the Master Servicer.


                                      G-3-1

<PAGE>



                           d. Neither the Buyer nor anyone acting on its behalf
         has offered, transferred, pledged, sold or otherwise disposed of the
         Rule 144A Securities, any interest in the Rule 144A Securities or any
         other similar security to, or solicited any offer to buy or accept a
         transfer, pledge or other disposition of the Rule 144A Securities, any
         interest in the Rule 144A Securities or any other similar security
         from, or otherwise approached or negotiated with respect to the Rule
         144A Securities, any interest in the Rule 144A Securities or any other
         similar security with, any person in any manner, or made any general
         solicitation by means of general advertising or in any other manner, or
         taken any other action, that would constitute a distribution of the
         Rule 144A Securities under the 1933 Act or that would render the
         disposition of the Rule 144A Securities a violation of Section 5 of the
         1933 Act or require registration pursuant thereto, nor will it act, nor
         has it authorized or will it authorize any person to act, in such
         manner with respect to the Rule 144A Securities.

                           e. The Buyer is a "qualified institutional buyer" as
         that term is defined in Rule 144A under the 1933 Act and has completed
         either of the forms of certification to that effect attached hereto as
         Annex 1 or Annex 2. The Buyer is aware that the sale to it is being
         made in reliance on Rule 144A. The Buyer is acquiring the Rule 144A
         Securities for its own account or the account of other qualified
         institutional buyers, understands that such Rule 144A Securities may be
         resold, pledged or transferred only (i) to a person reasonably believed
         to be a qualified institutional buyer that purchases for its own
         account or for the account of a qualified institutional buyer to whom
         notice is given that the resale, pledge or transfer is being made in
         reliance on Rule 144A, or (ii) pursuant to another exemption from
         registration under the 1933 Act.

                  3. The Buyer warrants and represents to, and covenants with,
the Transferor, the Servicer and the Company that either (1) the Buyer is not an
employee benefit plan within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") ("Plan"), or a plan
within the meaning of Section 4975(e)(1) of the Internal Revenue Code of 1986
(the "Code") (also a "Plan"), and the Buyer is not directly or indirectly
purchasing the Rule 144A Securities on behalf of, as investment manager of, as
named fiduciary of, as trustee of, or with assets of a Plan, or (2) the Buyer's
purchase of the Rule 144A Securities will not result in a prohibited transaction
under Section 406 of ERISA or Section 4975 of the Code.

                  4. This document may be executed in one or more counterparts
and by the different parties hereto on separate counterparts, each of which,
when so executed, shall be deemed to be an original; such counterparts,
together, shall constitute one and the same document.


                                      G-3-2

<PAGE>




                  IN WITNESS WHEREOF, each of the parties has executed this
document as of the date set forth below.




----------------------------------         -------------------------------------
    Print Name of Transferor                 Print Name of Buyer

By:                                        By:
   ---------------------------                ---------------------------
Name:                                      Name:
     -------------------------                  -------------------------
Title:                                     Title:
      ------------------------                   ------------------------

Taxpayer Identification:                   Taxpayer Identification:

No.                                        No.
   ---------------------------                ---------------------------

Date:                                                         Date:
   ---------------------------                ---------------------------

                                      G-3-3

<PAGE>



                                                          ANNEX 1 TO EXHIBIT G-3
                                                          ----------------------


            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
            --------------------------------------------------------

             [For Buyers Other Than Registered Investment Companies]

             The undersigned hereby certifies as follows in connection with the
Rule 144A Investment Representation to which this Certification is attached:

             1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.

             2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or invested
on a discretionary basis $______________________1 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A) and (ii)
the Buyer satisfies the criteria in the category marked below.

     ___     CORPORATION, etc. The Buyer is a corporation (other than a bank,
             savings and loan association or similar institution), Massachusetts
             or similar business trust, partnership, or charitable organization
             described in Section 501(c)(3) of the Internal Revenue Code.

     ___     BANK. The Buyer (a) is a national bank or banking institution
             organized under the laws of any State, territory or the District of
             Columbia, the business of which is substantially confined to
             banking and is supervised by the State or territorial banking
             commission or similar official or is a foreign bank or equivalent
             institution, and (b) has an audited net worth of at least
             $25,000,000 as demonstrated in its latest annual financial
             statement, a copy of which is attached hereto.

     ___     SAVINGS AND LOAN. The Buyer (a) is a savings and loan association,
             building and loan association, cooperative bank, homestead
             association or similar institution, which is supervised and
             examined by a State or Federal authority having supervision over
             any such institutions or is a foreign savings and loan association
             or equivalent institution and (b) has an audited net worth of at
             least $25,000,000 as demonstrated in its latest annual financial
             statements.

--------
1 Buyer must own and/or invest on a discretionary basis at least $100,000,000 in
securities unless Buyer is a dealer, and, in that case, Buyer must own and/or
invest on a discretionary basis at least $10,000,000 in securities.



                                      G-3-4

<PAGE>



     ___     Broker-dealer.  The Buyer is a dealer registered pursuant to
             Section 15 of the Securities Exchange Act of 1934.

     ___     Insurance Company. The Buyer is an insurance company whose primary
             and predominant business activity is the writing of insurance or
             the reinsuring of risks underwritten by insurance companies and
             which is subject to supervision by the insurance commissioner or a
             similar official or agency of a State, territory or the District of
             Columbia.

     ___     State or Local Plan.  The Buyer is a plan established and
             maintained by a State, its political subdivisions, or any agency
             or instrumentality of the State or its political subdivisions,
             for the benefit of its employees.

     ___     ERISA Plan. The Buyer is an employee benefit plan within the
             meaning of Title I of the Employee Retirement Income Security Act
             of 1974.

     ___     Investment Adviser.  The Buyer is an investment adviser registered
             under the Investment Advisers Act of 1940.

     ___     SBIC.  The Buyer is a Small Business Investment Company licensed by
             the U.S. Small Business Administration under Section 301(c) or
             (d) of the Small Business Investment Act of 1958.

     ___     Business Development Company.  The Buyer is a business development
             company as defined in Section 202(a)(22) of the Investment Advisers
             Act of 1940.

     ___     Trust Fund. The Buyer is a trust fund whose trustee is a bank or
             trust company and whose participants are exclusively (a) plans
             established and maintained by a State, its political subdivisions,
             or any agency or instrumentality of the State or its political
             subdivisions, for the benefit of its employees, or (b) employee
             benefit plans within the meaning of Title I of the Employee
             Retirement Income Security Act of 1974, but is not a trust fund
             that includes as participants individual retirement accounts or
             H.R. 10 plans.

             3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but subject to
a repurchase agreement and (vii) currency, interest rate and commodity swaps.

             4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries


                                      G-3-5

<PAGE>



of the Buyer, but only if such subsidiaries are consolidated with the Buyer in
its financial statements prepared in accordance with generally accepted
accounting principles and if the investments of such subsidiaries are managed
under the Buyer's direction. However, such securities were not included if the
Buyer is a majority-owned, consolidated subsidiary of another enterprise and the
Buyer is not itself a reporting company under the Securities Exchange Act of
1934.

             5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.

  ___        ___      Will the Buyer be purchasing the Rule 144A
  Yes        No       Securities only for the Buyer's own account?

             6. If the answer to the foregoing question is "no", the Buyer
agrees that, in connection with any purchase of securities sold to the Buyer for
the account of a third party (including any separate account) in reliance on
Rule 144A, the Buyer will only purchase for the account of a third party that at
the time is a "qualified institutional buyer" within the meaning of Rule 144A.
In addition, the Buyer agrees that the Buyer will not purchase securities for a
third party unless the Buyer has obtained a current representation letter from
such third party or taken other appropriate steps contemplated by Rule 144A to
conclude that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.

             7. The Buyer will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of Rule 144A Securities will
constitute a reaffirmation of this certification as of the date of such
purchase.

                                        ---------------------------
                                            Print Name of Buyer



                                     By:
                                        ---------------------------
                                     Name:
                                     Title:

                                     Date:
                                          -------------------------

                                                       G-3-6

<PAGE>



                                                          ANNEX 2 TO EXHIBIT G-3
                                                          ----------------------


            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
            --------------------------------------------------------

              [For Buyers That Are Registered Investment Companies]


             The undersigned hereby certifies as follows in connection with the
Rule 144A Investment Representation to which this Certification is attached:

              1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.

             2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, and (ii)
as marked below, the Buyer alone, or the Buyer's Family of Investment Companies,
owned at least $100,000,000 in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year. For
purposes of determining the amount of securities owned by the Buyer or the
Buyer's Family of Investment Companies, the cost of such securities was used.

____ The Buyer owned $___________________ in securities (other than the excluded
     securities referred to below) as of the end of the Buyer's most recent
     fiscal year (such amount being calculated in accordance with Rule 144A).

____ The Buyer is part of a Family of Investment Companies which owned in the
     aggregate $______________ in securities (other than the excluded securities
     referred to below) as of the end of the Buyer's most recent fiscal year
     (such amount being calculated in accordance with Rule 144A).

             3. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).

             4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) bank deposit notes and certificates
of deposit, (iii) loan participations, (iv) repurchase agreements, (v)
securities owned but subject to a repurchase agreement and (vi) currency,
interest rate and commodity swaps.


                                      G-3-7

<PAGE>



             5. The Buyer is familiar with Rule 144A and understands that each
of the parties to which this certification is made are relying and will continue
to rely on the statements made herein because one or more sales to the Buyer
will be in reliance on Rule 144A. In addition, the Buyer will only purchase for
the Buyer's own account.

             6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Buyer's purchase of Rule 144A Securities will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.


                                     ---------------------------
                                     Print Name of Buyer



                                     By:
                                        ---------------------------
                                     Name:
                                     Title:

                                     Date:
                                          -------------------------

                                     IF AN ADVISER:

                                     ---------------------------
                                     Print Name of Buyer


                                     Date:
                                          ----------------------





                                      G-3-8

<PAGE>



                                   EXHIBIT G-4

                         FORM OF TRANSFEROR CERTIFICATE

                                            ___________________, 200__

Impac Secured Assets Corp.
1401 Dove Street
Newport Beach, California 92660

Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

Attention: Impac Secured Assets Corp. Series 2001-3

             Re: Impac Secured Assets Corp.
                  Mortgage Pass-Through Certificates
                  Series 2001-3, Class R
                  ----------------------

Ladies and Gentlemen:

             This letter is delivered to you in connection with the sale by
___________________________ (the "Seller") to _____________________________ (the
"Purchaser") of a ___% Percentage Interest in the Mortgage Pass-Through
Certificates, Series
2001-3, Class R (the "Certificates"), issued pursuant to Section 5.02 of the
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement"), dated
as of April 1, 2001, among Impac Secured Assets Corp., as company (the
"Company"), Impac Funding Corporation, as master servicer and Bankers Trust
Company of California, N.A., as trustee (the "Trustee"). All terms used herein
and not otherwise defined shall have the meaning set forth in the Pooling and
Servicing Agreement. The Seller hereby certifies, represents and warrants to,
and covenants with, the Company and the Trustee that:

             1. No purpose of the Seller relating to the sale of the
Certificates by the Seller to the Purchaser is or will be to impede the
assessment or collection of any tax.

             2. The Seller understands that the Purchaser has delivered to the
Trustee and the Master Servicer a transfer affidavit and agreement in the form
attached to the Pooling and Servicing Agreement as Exhibit G-5. The Seller does
not know or believe that any representation contained therein is false.

             3. The Seller has at the time of the transfer conducted a
reasonable investigation of the financial condition of the Purchaser as
contemplated by Treasury Regulations Section 1.860E- 1(c)(4)(i) and, as a result
of that investigation, the Seller has determined that the Purchaser has
historically paid its debts as they have become due and has found no significant
evidence to indicate that the Purchaser will not continue to pay its debts as
they become due in the future. The Seller understands that the transfer of the
Certificates may not be respected for United States income tax purposes (and the
Seller may continue to be liable for United States income taxes associated
therewith) unless the Seller has conducted such an investigation.

             4. The Seller has no actual knowledge that the proposed Transferee
is a Disqualified Organization, an agent of a Disqualified Organization or a
Non-United States Person.

                                     Very truly yours,

                                     -----------------------------------
                                     (Seller)



                                     By:
                                        ---------------------------
                                     Name:
                                          -------------------------
                                     Title:
                                           ------------------------


                                      G-4-1

<PAGE>



                                   EXHIBIT G-5

                    FORM OF TRANSFER AFFIDAVIT AND AGREEMENT



STATE OF     )
             : ss.:
COUNTY OF    )


             ___________________, being first duly sworn, deposes, represents
and warrants:

             1. That he/she is [Title of Officer] of [Name of Owner], a [savings
institution] [corporation] duly organized and existing under the laws of [the
State of ___________] [the United States], (the "Owner"), (record or beneficial
owner of the Class R Certificates (the "Class R Certificates") on behalf of
which he/she makes this affidavit and agreement). This Class R Certificates were
issued pursuant to the Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement") dated as of April 1, 2001 among Impac Secured Assets
Corp., as company, Impac Funding Corporation, as master servicer (the "Master
Servicer"), and Bankers Trust Company of California, N.A., as trustee (the
"Trustee").

             2. That the Owner (i) is not and will not be a "disqualified
organization" as of _______________[date of transfer] within the meaning of
Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended (the
"Code"), (ii) will endeavor to remain other than a disqualified organization for
so long as it retains its ownership interest in the Class R Certificates, and
(iii) is acquiring the Class R Certificates for its own account or for the
account of another Owner from which it has received an affidavit and agreement
in substantially the same form as this affidavit and agreement. (For this
purpose, a "disqualified organization" means the United States, any state or
political subdivision thereof, any agency or instrumentality of any of the
foregoing (other than an instrumentality all of the activities of which are
subject to tax and, except for Freddie Mac, a majority of whose board of
directors is not selected by any such governmental entity) or any foreign
government, international organization or any agency or instrumentality of such
foreign government or organization, any rural electric or telephone cooperative,
or any organization (other than certain farmers' cooperatives) that is generally
exempt from federal income tax unless such organization is subject to the tax on
unrelated business taxable income).

             3. That the Owner is aware (i) of the tax that would be imposed on
transfers of Class R Certificates to disqualified organizations under the Code,
that applies to all transfers of Class R Certificates after March 31, 1988; (ii)
that such tax would be on the transferor, or, if such transfer is through an
agent (which person includes a broker, nominee or middleman) for a disqualified
organization, on the agent; (iii) that the person otherwise liable for the tax
shall be relieved of liability for the tax if the transferee furnishes to such
person an affidavit that the transferee is not a


                                      G-5-1

<PAGE>



disqualified organization and, at the time of transfer, such person does not
have actual knowledge that the affidavit is false; and (iv) that the Class R
Certificates may be "noneconomic residual interests" within the meaning of
Treasury regulations promulgated pursuant to the Code and that the transferor of
a noneconomic residual interest will remain liable for any taxes due with
respect to the income on such residual interest, unless no significant purpose
of the transfer was to impede the assessment or collection of tax.

             4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding Class R Certificates if at any time during the taxable year of
the pass-through entity a disqualified organization is the record holder of an
interest in such entity. (For this purpose, a "pass through entity" includes a
regulated investment company, a real estate investment trust or common trust
fund, a partnership, trust or estate, and certain cooperatives.)

             5. That the Owner is aware that the Trustee will not register the
transfer of any Class R Certificates unless the transferee, or the transferee's
agent, delivers to it an affidavit and agreement, among other things, in
substantially the same form as this affidavit and agreement. The Owner expressly
agrees that it will not consummate any such transfer if it knows or believes
that any of the representations contained in such affidavit and agreement are
false.

             6. That the Owner has reviewed the restrictions set forth on the
face of the Class R Certificates and the provisions of Section 5.02(f) of the
Pooling and Servicing Agreement under which the Class R Certificates were issued
(in particular, clause (iii)(A) and (iii)(B) of Section 5.02(f) which authorize
the Trustee to deliver payments to a person other than the Owner and negotiate a
mandatory sale by the Trustee in the event the Owner holds such Certificates in
violation of Section 5.02(f)). The Owner expressly agrees to be bound by and to
comply with such restrictions and provisions.

             7. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to constitute
a reasonable arrangement to ensure that the Class R Certificates will only be
owned, directly or indirectly, by an Owner that is not a disqualified
organization.

             8.   The Owner's Taxpayer Identification Number is ______________.

             9. This affidavit and agreement relates only to the Class R
Certificates held by the Owner and not to any other holder of the Class R
Certificates. The Owner understands that the liabilities described herein relate
only to the Class R Certificates.

             10. That no purpose of the Owner relating to the transfer of any of
the Class R Certificates by the Owner is or will be to impede the assessment or
collection of any tax.

             11.  That the Owner has no present knowledge or expectation that
it will be unable to pay any United States taxes owed by it so long as any of
the Certificates remain outstanding. In this


                                      G-5-2

<PAGE>



regard, the Owner hereby represents to and for the benefit of the person from
whom it acquired the Class R Certificate that the Owner intends to pay taxes
associated with holding such Class R Certificate as they become due, fully
understanding that it may incur tax liabilities in excess of any cash flows
generated by the Class R Certificate.

             12. That the Owner has no present knowledge or expectation that it
will become insolvent or subject to a bankruptcy proceeding for so long as any
of the Class R Certificates remain outstanding.

             13. The Owner is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, provided that
with respect to any partnership or other entity treated as a partnership for
United States federal income tax purposes, all persons that own an interest in
such partnership either directly or through any entity that is not a corporation
for United States federal income tax purposes are required by the applicable
operative agreement to be United States Persons, or an estate or trust whose
income from sources without the United States is includible in gross income for
United States federal income tax purposes regardless of its connection with the
conduct of a trade or business within the United States.

             14. (a) The Certificates (i) are not being acquired by, and will
not be transferred to, any employee benefit plan within the meaning of section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") or other retirement arrangement, including individual retirement
accounts and annuities, Keogh plans and bank collective investment funds and
insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that is subject to Section 406 of ERISA or Section
4975 of the Internal Revenue Code of 1986 (the "Code") (any of the foregoing, a
"Plan"), (ii) are not being acquired with "plan assets" of a Plan within the
meaning of the Department of Labor ("DOL") regulation, 29 C.F.R. ss. 2510.3-101
or otherwise under ERISA, and (iii) will not be transferred to any entity that
is deemed to be investing in plan assets within the meaning of the DOL
regulation, 29 C.F.R. ss. 2510.3-101 or otherwise under ERISA; or

             (b) The Owner will provide the Trustee, the Company and the Master
Servicer with an opinion of counsel acceptable to and in form and substance
satisfactory to the Trustee, the Company and the Master Servicer to the effect
that the purchase of Certificates is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code and will not subject the Trustee, the Company or the
Master Servicer to any obligation or liability (including obligations or
liabilities under ERISA or Section 4975 of the Code) in addition to those
undertaken in the Pooling and Servicing Agreement.

             In addition, the Owner hereby certifies, represents and warrants
to, and covenants with, the Company, the Trustee and the Master Servicer that
the Owner will not transfer such Certificates to any Plan or person unless
either such Plan or person meets the requirements set forth in either (a) or (b)
above.


                                      G-5-3

<PAGE>



             Capitalized terms used but not defined herein shall have the
meanings assigned in the Pooling and Servicing Agreement.



                                      G-5-4

<PAGE>



             IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, by its [Title of Officer] and its corporate seal to be
hereunto attached, attested by its [Assistant] Secretary, this ____ day of
____________, ____.


                                           [NAME OF OWNER]


                                            By:
                                               ------------------------------
                                                     [Name of Officer]
                                                     [Title of Officer]

[Corporate Seal]

ATTEST:


[Assistant] Secretary

             Personally appeared before me the above-named [Name of Officer],
known or proved to me to be the same person who executed the foregoing
instrument and to be the [Title of Officer] of the Owner, and acknowledged to me
that such person executed the same as such person's free act and deed and the
free act and deed of the Owner.

             Subscribed and sworn before me this ___ day of _____________,
200__.



                                            ---------------------------------
                                                     NOTARY PUBLIC

                                            COUNTY OF
                                                     -------------------------
                                            STATE OF
                                                     -------------------------
                                            My Commission expires the ____ day
                                            of _______, 200__.




                                      G-5-5

<PAGE>



                                    EXHIBIT H

                             MORTGAGE LOAN SCHEDULE

                             (Provided Upon Request)


                                       H-1

<PAGE>



                                    EXHIBIT I

                      SELLER REPRESENTATIONS AND WARRANTIES

Seller's Representations Assigned by Company to Trustee

             Representations and Warranties. Pursuant to the Mortgage Loan
Purchase Agreement, the Seller has made certain representations and warranties
to the Company. The Seller shall confirm such representations and warranties and
shall deliver a Seller's Warranty Certificate and an Officers' Certificate on
the Closing Date (i) reaffirming such representations and warranties and (ii)
specifically restating and reaffirming the following representations and
warranties as of such date. The following representations are, pursuant to the
Pooling and Servicing Agreement, assigned by the Company to the Trustee for the
benefit of the Certificateholders, together with the related repurchase rights
specified in the Mortgage Loan Purchase Agreement. Pursuant to the Mortgage Loan
Purchase Agreement, the Seller's Warranty Certificate and related Officer's
Certificate, the Seller affirms each such representation and warranty and
agrees, consents to and acknowledges the assignment thereof to the Trustee. All
capitalized terms herein shall have the meanings assigned in the Pooling and
Servicing Agreement and the Seller's Warranty Certificate, as applicable.

             The Seller hereby represents and warrants to the Company and
Trustee, as to each Mortgage Loan, that as of the Closing Date or as of such
other date specifically provided herein:

             (i)  the information set forth in the Mortgage Loan Schedule hereto
             is true and correct in all material respects;

             (ii) the terms of the Mortgage Note and the Mortgage have not been
             impaired, waived, altered or modified in any respect, except by
             written instruments, (i) if required by law in the jurisdiction
             where the Mortgaged Property is located, or (ii) to protect the
             interests of the Trustee on behalf of the Certificateholders;

             (iii)the Mortgage File for each Mortgage Loan contains a true and
             complete copy of each of the documents contained in such Mortgage
             File, including all amendments, modifications and, if applicable,
             waivers and assumptions that have been executed in connection with
             such Mortgage Loan;

             (iv) immediately prior to the transfer to the Purchaser, the Seller
             was the sole owner of beneficial title and holder of each Mortgage
             and Mortgage Note relating to the Mortgage Loans and is conveying
             the same free and clear of any and all liens, claims, encumbrances,
             participation interests, equities, pledges, charges or security
             interests of any nature and the Seller has full right and authority
             to sell or assign the same pursuant to this Agreement;



                                      I-1

<PAGE>



             (v) each Mortgage is a valid and enforceable first lien on the
             property securing the related Mortgage Note and each Mortgaged
             Property is owned by the Mortgagor in fee simple (except with
             respect to common areas in the case of condominiums, PUDs and de
             minimis PUDs) or by leasehold for a term longer than the term of
             the related Mortgage, subject only to (i) the lien of current real
             property taxes and assessments, (ii) covenants, conditions and
             restrictions, rights of way, easements and other matters of public
             record as of the date of recording of such Mortgage, such
             exceptions being acceptable to mortgage lending institutions
             generally or specifically reflected in the appraisal obtained in
             connection with the origination of the related Mortgage Loan or
             referred to in the lender's title insurance policy delivered to the
             originator of the related Mortgage Loan and (iii) other matters to
             which like properties are commonly subject which do not materially
             interfere with the benefits of the security intended to be provided
             by such Mortgage;

             (vi) no payment of principal of or interest on or in respect of
             any Mortgage Loan is 30 or more days past due;

             (vii) there is no mechanics' lien or claim for work, labor or
             material affecting the premises subject to any Mortgage which is or
             may be a lien prior to, or equal with, the lien of such Mortgage
             except those which are insured against by the title insurance
             policy referred to in (xii) below;

             (viii) as of the Cut-off Date, (i) no Mortgage Loan had been 30
             days or more delinquent more than once during the preceding 12
             months, (ii) no Mortgage Loan had been delinquent for 60 days or
             more during the preceding 12 months and (iii) to Seller's
             knowledge, there was no delinquent tax or assessment lien against
             the property subject to any Mortgage, except where such lien was
             being contested in good faith and a stay had been granted against
             levying on the property;

             (ix) there is no valid offset, defense or counterclaim to any
             Mortgage Note or Mortgage, including the obligation of the
             Mortgagor to pay the unpaid principal and interest on such Mortgage
             Note;

             (x) to Seller's knowledge, except to the extent insurance is in
             place which will cover such damage, the physical property subject
             to any Mortgage is free of material damage and is in good repair
             and there is no proceeding pending or threatened for the total or
             partial condemnation of any Mortgaged Property;

             (xi) to the best of Seller's knowledge, each Mortgage Loan at the
             time it was made complied in all material respects with applicable
             state and federal laws, including, without limitation, usury, equal
             credit opportunity and disclosure laws; and each Mortgage Loan is
             being serviced in all material respects in accordance with
             applicable


                                       I-2

<PAGE>



             state and federal laws, including, without limitation, usury,
             equal credit opportunity and disclosure laws;

             (xii) a lender's title insurance policy (on an ALTA or CLTA form)
             or binder, or other assurance of title customary in the relevant
             jurisdiction therefor in a form acceptable to Fannie Mae or Freddie
             Mac, was issued on the date that each Mortgage Loan was created by
             a title insurance company which, to the best of Seller's knowledge,
             was qualified to do business in the jurisdiction where the related
             Mortgaged Property is located, insuring the Seller and its
             successors and assigns that the Mortgage is a first priority lien
             on the related Mortgaged Property in the original principal amount
             of the Mortgage Loan. Seller is the sole insured under such
             lender's title insurance policy, and such policy, binder or
             assurance is valid and remains in full force and effect, and each
             such policy, binder or assurance shall contain all applicable
             endorsements including a negative amortization endorsement, if
             applicable;

             (xiii) in the event the Mortgage constitutes a deed of trust,
             either a trustee, duly qualified under applicable law to serve as
             such, has been properly designated and currently so serves and is
             named in the Mortgage or if no duly qualified trustee has been
             properly designated and so serves, the Mortgage contains
             satisfactory provisions for the appointment of such trustee by the
             holder of the Mortgage at no cost or expense to such holder, and no
             fees or expenses are or will become payable by Purchaser to the
             trustee under the deed of trust, except in connection with a
             trustee's sale after default by the mortgagor;

             (xiv) (i) the Loan-to-Value Ratio of each Mortgage Loan at
             origination was not more than _____%; (ii) except with respect to
             approximately ___% of the Mortgage Loans (by aggregate outstanding
             principal balance as of the Cut-off Date), each Mortgage Loan with
             a Loan-to-Value Ratio at origination in excess of 80.00% will be
             insured by one of the following: (i) a Primary Insurance Policy
             issued by a private mortgage insurer or (ii) a Radian Lender-Paid
             PMI Policy. Each Primary Insurance Policy will insure against
             default under each insured Mortgage Note as follows: (i) for which
             the outstanding principal balance at origination of such Mortgage
             Loan is greater than or equal to 80.01% and up to and including
             90.00% of the lesser of the Appraised Value and the sales price,
             such Mortgage Loan is covered by a Primary Insurance Policy in an
             amount equal to at least 12.00% of the Allowable Claim and (ii) for
             which the outstanding principal balance at origination of such
             Mortgage Loan exceeded 90.00% of the lesser of the Appraised Value
             and the sales price, such Mortgage Loan is covered by a Primary
             Insurance Policy in an amount equal to at least 30.00% of the
             Allowable Claim. Each Radian Lender-Paid PMI Policy will insure
             against default under each insured Mortgage Note related to a
             covered Mortgage Loan as follows: (A) for which the outstanding
             principal balance at origination of such Mortgage Loan is at least
             80.01% and up to and including 89.99% of the lesser of the
             Appraised Value and the sales price, such Mortgage Loan is covered
             by such Radian Lender-Paid PMI Policy in an amount equal


                                       I-3

<PAGE>



             to at least 22.00% of the Allowable Claim, (B) for which the
             outstanding principal balance at origination of such Mortgage Loan
             is at least 90.00% and up to and including 95.00% of the lesser of
             the Appraised Value and the sales price, such Mortgage Loan is
             covered by such Radian Lender-Paid PMI Policy in an amount equal to
             at least 25.00% of the Allowable Claim and (C) for which the
             outstanding principal balance at origination of such Mortgage Loan
             is at least 95.01% and up to and including 97.00% of the lesser of
             the Appraised Value and the sales price, such Mortgage Loan is
             covered by such Radian Lender-Paid PMI Policy in an amount equal to
             at least 35.00% of the Allowable Claim. The "Appraised Value" is
             the appraised value of the related Mortgaged Property at the time
             of origination of such Mortgage Loan. The "Allowable Claim" for any
             Mortgage Loan covered by a Primary Insurance Policy or a Radian PMI
             Pool Policy is the current principal balance of such Mortgage Loan
             plus accrued interest and allowable expenses at the time of the
             claim;

             (xv) at the time of origination, each Mortgaged Property was the
             subject of an appraisal which conforms to the Seller's underwriting
             requirements, and a complete copy of such appraisal is contained in
             the Mortgage File;

             (xvi) on the basis of a representation by the borrower at the time
             of origination of the Mortgage Loans, at least _____% of the
             Mortgage Loans (by aggregate principal balance) will be secured by
             Mortgages on owner-occupied primary residence properties;

             (xvii) neither the Seller nor any servicer of the related Mortgage
             Loans has advanced funds or knowingly received any advance of funds
             by a party other than the Mortgagor, directly or indirectly, for
             the payment of any amount required by the Mortgage, except for (i)
             interest accruing from the date of the related Mortgage Note or
             date of disbursement of the Mortgage Loan proceeds, whichever is
             later, to the date which precedes by 30 days the first Due Date
             under the related Mortgage Note, and (ii) customary advances for
             insurance and taxes;

             (xviii) each Mortgage Note, the related Mortgage and other
             agreements executed in connection therewith are genuine, and each
             is the legal, valid and binding obligation of the maker thereof,
             enforceable in accordance with its terms except as such enforcement
             may be limited by bankruptcy, insolvency, reorganization or other
             similar laws affecting the enforcement of creditors' rights
             generally and by general equity principles (regardless of whether
             such enforcement is considered in a proceeding in equity or at
             law); and, to the best of Seller's knowledge, all parties to each
             Mortgage Note and the Mortgage had legal capacity to execute the
             Mortgage Note and the Mortgage and each Mortgage Note and Mortgage
             has been duly and properly executed by the Mortgagor;

             (xix) to the extent required under applicable law, each conduit
             seller and subsequent mortgagee or servicer of the Mortgage Loans
             was authorized to transact and do business in the jurisdiction in
             which the related Mortgaged Property is located at all


                                       I-4

<PAGE>



             times when it held or serviced the Mortgage Loan; and any
             obligations of the holder of the related Mortgage Note, Mortgage
             and other loan documents have been complied with in all material
             respects; servicing of each Mortgage Loan has been in accordance
             with the servicing standard set forth in Section 3.01 of the
             Pooling and Servicing Agreement and the terms of the Mortgage
             Notes, the Mortgage and other loan documents, whether the creation
             of such Mortgage Loan and servicing was done by the Seller, its
             affiliates, or any third party which created the Mortgage Loan on
             behalf of, or sold the Mortgage Loan to, any of them, or any
             servicing agent of any of the foregoing;

               (xx) the related Mortgage Note and Mortgage contain customary and
             enforceable provisions such as to render the rights and remedies of
             the holder adequate for the realization against the Mortgaged
             Property of the benefits of the security, including realization by
             judicial, or, if applicable, non-judicial foreclosure, and, to
             Seller's knowledge, there is no homestead or other exemption
             available to the Mortgagor which would interfere with such right to
             foreclosure;

             (xxi) except with respect to holdbacks required by certain Mortgage
             Loans which holdbacks create a fund for (i) the repair of Mortgaged
             Property due to damage from adverse weather conditions, or (ii) the
             completion of new construction, or both, the proceeds of the
             Mortgage Loans have been fully disbursed, there is no requirement
             for future advances thereunder and any and all requirements as to
             completion of any on-site or off-site improvements and as to
             disbursements of any escrow funds therefor have been complied with;
             and all costs, fees and expenses incurred in making, closing or
             recording the Mortgage Loan have been paid, except recording fees
             with respect to Mortgages not recorded as of the Closing Date;

             (xxii) as of the Closing Date, the improvements on each Mortgaged
             Property securing a Mortgage Loan is insured (by an insurer which
             is acceptable to the Seller) against loss by fire and such hazards
             as are covered under a standard extended coverage endorsement in
             the locale in which the Mortgaged Property is located, in an amount
             which is not less than the lesser of the maximum insurable value of
             the improvements securing such Mortgage Loan or the outstanding
             principal balance of the Mortgage Loan, but in no event in an
             amount less than an amount that is required to prevent the
             Mortgagor from being deemed to be a co-insurer thereunder; if the
             improvement on the Mortgaged Property is a condominium unit, it is
             included under the coverage afforded by a blanket policy for the
             condominium project; if upon origination of the related Mortgage
             Loan, the improvements on the Mortgaged Property were in an area
             identified as a federally designated flood area, a flood insurance
             policy is in effect in an amount representing coverage not less
             than the least of (i) the outstanding principal balance of the
             Mortgage Loan, (ii) the restorable cost of improvements located on
             such Mortgaged Property or (iii) the maximum coverage available
             under federal law; and each Mortgage obligates the Mortgagor
             thereunder to maintain the insurance referred to above at the
             Mortgagor's cost and expense;


                                       I-5

<PAGE>



             (xxiii) there is no monetary default existing under any Mortgage or
             the related Mortgage Note and there is no material event which,
             with the passage of time or with notice and the expiration of any
             grace or cure period, would constitute a default, breach or event
             of acceleration; and neither the Seller, any of its affiliates nor
             any servicer of any related Mortgage Loan has taken any action to
             waive any default, breach or event of acceleration; no foreclosure
             action is threatened or has been commenced with respect to the
             Mortgage Loan;

             (xxiv) to Seller's knowledge, no Mortgagor, at the time of
             origination of the applicable Mortgage, was a debtor in any state
             or federal bankruptcy or insolvency proceeding;

             (xxv) Each Mortgage Loan was originated or funded by (a) a savings
             and loan association, savings bank, commercial bank, credit union,
             insurance company or similar institution which is supervised and
             examined by a federal or state authority (or originated by (i) a
             subsidiary of any of the foregoing institutions which subsidiary is
             actually supervised and examined by applicable regulatory
             authorities or (ii) a mortgage loan correspondent of any of the
             foregoing and that was originated pursuant to the criteria
             established by any of the foregoing) or (b) a mortgagee approved by
             the Secretary of Housing and Urban Development pursuant to sections
             203 and 211 of the National Housing Act, as amended;

             (xxvi) all inspections, licenses and certificates required to be
             made or issued with respect to all occupied portions of the
             Mortgaged Property and, with respect to the use and occupancy of
             the same, including, but not limited to, certificates of occupancy
             and fire underwriting certificates, have been made or obtained from
             the appropriate authorities;

             (xxvii) to Seller's knowledge, the Mortgaged Property and all
             improvements thereon comply with all requirements of any
             applicable zoning and subdivision laws and ordinances;

             (xxviii) no instrument of release or waiver has been executed in
             connection with the Mortgage Loans, and no Mortgagor has been
             released, in whole or in part, except in connection with an
             assumption agreement which has been approved by the primary
             mortgage guaranty insurer, if any, and which has been delivered to
             the Trustee;

             (xxix) except with respect to ____% of the Mortgage Loans (by
             aggregate principal balance) which provide for a balloon payment,
             each Mortgage Note contains provisions providing for its full
             amortization by the end of its original term and is payable on the
             first day of each month in monthly installments of principal and
             interest, with interest payable in arrears, over an original term
             of not more than 30 years;



                                       I-6

<PAGE>



             (xxx) no Mortgage Loan was originated based on an appraisal of the
             related Mortgaged Property made prior to completion of construction
             of the improvements thereon unless a certificate of completion was
             obtained prior to closing of the Mortgage Loan;

             (xxxi) each of the Mortgaged Properties consists of a single parcel
             of real property with a detached single-family residence erected
             thereon, or a two- to four-family dwelling, or an individual
             condominium unit in a condominium project or a townhouse, a
             condohotel, an individual unit in a PUD or an individual unit in a
             de minimis PUD;

             (xxxii) no Mortgaged Property consists of a single parcel of real
             property with a cooperative housing development erected thereon.
             Any condominium unit, PUD or de minimis PUD conforms with
             Progressive Loan Series Program requirements regarding such
             dwellings or is covered by a waiver confirming that such
             condominium unit, PUD or de minimis PUD is acceptable to the
             Seller;

             (xxxiii) as of the Cut-off Date, the Mortgage Rate of each Mortgage
             Loan was not less than _________% per annum and not more than
             ___________% per annum, and the weighted average Mortgage Rate of
             the Mortgage Loans was approximately _________% per annum;

             (xxxiv) measured by principal balance, no more than ____% of the
             Mortgage Loans are secured by an individual unit in a condominium
             project or hi-rise, and at least _____% of the Mortgage Loans are
             secured by real property with a detached single-family residence
             erected thereon, including de minimis PUDs;

             (xxxv) as of the Cut-off Date, the remaining term to scheduled
             maturity of each Mortgage Loan is not less than ___ months and not
             more than [360] months;

             (xxxvi) as of the Cut-off Date, no more than ____% (by aggregate
             principal balance) of the Mortgage Loans are cash-out refinances;

             (xxxvii) as of the Cut-off Date, no more than ____% (by aggregate
             principal balance) of the Mortgage Loans are rate and term
             refinances;

             (xxxviii) as of the Cut-off Date, no fewer than _____% (by
             aggregate principal balance) of the Mortgage Loans are purchase
             money loans;

             (xxxix) as of the Cut-off Date, no more than ____% and ____% of the
             Mortgage Loans (by aggregate principal balance) are secured by
             properties located in the states of California and [Florida],
             respectively;



                                       I-7

<PAGE>



             (xl) as of the Cut-off Date, the principal balances of the Mortgage
             Loans range from approximately $______ to approximately $_______,
             and the average unpaid principal balance is $_______.

             (xli) with respect to Mortgaged Properties at the time of
             origination of the related Mortgage Loans, measured by aggregate
             unpaid principal balance as of the Cut-off Date, at least _____% of
             the Mortgaged Properties are owner occupied primary residences, no
             more than _____% of the Mortgaged Properties are second homes and
             no more than ____% of the Mortgaged Properties are investor owned
             properties;

             (xlii) as of the Cut-off Date, none of the Mortgage Loans (by
             aggregate principal balance) are Buydown Mortgage Loans;

             (xliii) each Mortgage Loan constitutes a "qualified mortgage"
             under Section 860G(a)(3)(A) of the Code and Treasury Regulation
             Section 1.860G-2(a)(1);

             (xliv) with respect to each Mortgage Loan directly originated by
             the Seller (and not through a third-party broker or other third
             party) as of the Closing Date, to the best of Seller's knowledge,
             there has been no fraud, misrepresentation or dishonesty with
             respect to the origination of any Mortgage Loan;

             (xlv) No selection procedure reasonably believed by the Seller to
             be adverse to the interests of the Certificateholders was
             utilized in selecting the Mortgage Loans;

             (xlvi) No Mortgage Loan is subject to the Home Ownership and
             Equity Protection Act of 1994 or any comparable state law;

             (xlvii) No proceeds from any Mortgage Loan were used to finance
             single-premium credit insurance policies; and

             (xlviii) No Mortgage Loan provides for payment of a Prepayment
             Charge on Principal Preayments made more than five years from the
             date of origination of the related Mortgage Loan.





                                       I-8

<PAGE>



                                    EXHIBIT J

      FORM OF NOTICE UNDER SECTION 3.25 OF POOLING AND SERVICING AGREEMENT


     April__, 2001


Bankers Trust Company of California, N.A.
1761 East St. Andrew Place
Santa Ana, California 92705

                 Re:    Impac Secured Assets Corp.
                        Mortgage Pass-Through Certificates
                        Series 2001-3
                        ----------------------------------

                 Pursuant to Section 3.25 of the Pooling and Servicing
Agreement, dated as of April 1, 2001, relating to the Certificates referenced
above, the undersigned does hereby notify you that:

                 (a) The prepayment assumption used in pricing the Certificates
with respect to the Mortgage Loans in Series 2001-3 consisted of a Prepayment
Assumption (the "Prepayment Assumption") of 100% per annum.

                 (b) With respect to each Class of Certificates comprising the
captioned series, set forth below is (i), the first price, as a percentage of
the Certificate Principal Balance or Notional Amount of each Class of
Certificates, at which 10% of the aggregate Certificate Principal Balance or
Notional Amount of each such Class of Certificates was first sold at a single
price, if applicable, or (ii) if more than 10% of a Class of Certificates have
been sold but no single price is paid for at least 10% of the aggregate
Certificate Principal Balance or Notional Amount of such Class of Certificates,
then the weighted average price at which the Certificates of such Class were
sold expressed as a percentage of the Certificate Principal Balance or Notional
Amount of such Class of Certificates, (iii) if less than 10% of the aggregate
Certificate Principal Balance or Notional Amount of a Class of Certificates has
been sold, the purchase price for each such Class of Certificates paid by Bear,
Stearns & Co. Inc. (the "Underwriter"), expressed as a percentage of the
Certificate Principal Balance or Notional Amount of such Class of Certificates
calculated by: (1) estimating the fair market value of each such Class of
Certificates as of April__, 2001; (2) adding such estimated fair market value to
the aggregate purchase prices of each Class of Certificates described in clause
(i) or (ii) above; (3) dividing each of the fair market values determined in
clause (1) by the sum obtained in clause (2); (4) multiplying the quotient
obtained for each Class of Certificates in clause (3) by the purchase price paid
by the Underwriter for all the Certificates purchased by it; and (5) for each
Class of Certificates, dividing the product obtained from such Class of
Certificates in clause (4) by the initial Certificate Principal Balance or
Notional Amount of such Class of Certificates or


                                       J-1

<PAGE>



(iv) the fair market value (but not less than zero) as of the Closing Date of
each Certificate of each Class of Certificates retained by the Company or an
affiliate corporation, or delivered to the seller:

Series 2001-3
Class A-1:       ____%
Class A-2:       ____%
Class A-IO:      ____%
Class M-1:       ____%
Class M-2:       ____%
Class B:         ____%



                 The prices and values set forth above do not include accrued
interest with respect to periods before the closing.

                                      IMPAC SECURED ASSETS CORP.


                                      By:
                                         ----------------------------------
                                      Name:
                                           --------------------------------
                                      Title:
                                            -------------------------------

                                       J-2

<PAGE>


                                    EXHIBIT K

                              IMPAC SERVICING GUIDE

                             (Provided Upon Request)