STRUCTURED ASSET MORTGAGE INVESTMENTS INC.,
                                     SELLER

                      DEUTSCHE BANK NATIONAL TRUST COMPANY,
                                     TRUSTEE

                WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
                  MASTER SERVICER AND SECURITIES ADMINISTRATOR

                                       and

                            EMC MORTGAGE CORPORATION

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

                         POOLING AND SERVICING AGREEMENT

                            Dated as of June 1, 2003

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


                   Structured Asset Mortgage Investments Inc.
              Structured Asset Mortgage Investments Trust 2003-CL1,
               Mortgage Pass-Through Certificates Series 2003-CL1




<PAGE>



<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS
                                                                                                               Page
<S>                                                                                                            <C>
                                                    Definitions

                                           Conveyance of Mortgage Loans;
                                         Original Issuance of Certificates
         Section  2.01     CONVEYANCE OF MORTGAGE LOANS TO TRUSTEE...............................................47
         Section  2.02     ACCEPTANCE OF MORTGAGE LOANS BY TRUSTEE...............................................50
         Section  2.03     ASSIGNMENT OF INTEREST IN THE MORTGAGE LOAN PURCHASE AGREEMENT........................52
         Section  2.04     SUBSTITUTION OF MORTGAGE LOANS........................................................53
         Section  2.05     ISSUANCE OF CERTIFICATES..............................................................54
         Section  2.06     REPRESENTATIONS AND WARRANTIES CONCERNING THE SELLER..................................55

                                                    ARTICLE III
                               Administration and Master Servicing of Mortgage Loans
         Section  3.01     MASTER SERVICER.......................................................................57
         Section  3.02     REMIC-RELATED COVENANTS...............................................................58
         Section  3.03     MONITORING OF SERVICERS...............................................................58
         Section  3.04     FIDELITY BOND.........................................................................60
         Section  3.05     POWER TO ACT; PROCEDURES..............................................................60
         Section  3.06     DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS............................................61
         Section  3.07     RELEASE OF MORTGAGE FILES.............................................................61
         Section  3.08     DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER SERVICER TO
                           BE HELD FOR TRUSTEE...................................................................62
         Section  3.09     STANDARD HAZARD INSURANCE AND FLOOD INSURANCE POLICIES................................63
         Section  3.10     PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS......................................63
         Section  3.11     MAINTENANCE OF THE PRIMARY MORTGAGE INSURANCE POLICIES................................63
         Section  3.12     TRUSTEE TO RETAIN POSSESSION OF CERTAIN INSURANCE POLICIES AND
                           DOCUMENTS.............................................................................64
         Section  3.13     REALIZATION UPON DEFAULTED MORTGAGE LOANS.............................................64
         Section  3.14     COMPENSATION FOR THE MASTER SERVICER..................................................65
         Section  3.15     REO PROPERTY..........................................................................66
         Section  3.16     ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.........................................66
         Section  3.17     ANNUAL INDEPENDENT ACCOUNTANT'S SERVICING REPORT......................................67
         Section  3.18     REPORTS FILED WITH SECURITIES AND EXCHANGE COMMISSION.................................68
         Section  3.19     EMC...................................................................................69
         Section  3.20     UCC...................................................................................69
         Section  3.21     OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS.........................................69

                                                    ARTICLE IV
                                                     Accounts
         Section  4.01     PROTECTED ACCOUNTS....................................................................70
         Section  4.02     MASTER SERVICER COLLECTION ACCOUNT....................................................71
         Section  4.03     PERMITTED WITHDRAWALS AND TRANSFERS FROM THE MASTER SERVICER
                           COLLECTION ACCOUNT....................................................................72


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<PAGE>



         Section  4.04     DISTRIBUTION ACCOUNT..................................................................73
         Section  4.05     PERMITTED WITHDRAWALS AND TRANSFERS FROM THE DISTRIBUTION ACCOUNT.....................74

                                                     ARTICLE V
                                                   Certificates
         Section  5.01     CERTIFICATES..........................................................................77
         Section  5.02     REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.................................85
         Section  5.03     MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.....................................88
         Section  5.04     PERSONS DEEMED OWNERS.................................................................89
         Section  5.05     TRANSFER RESTRICTIONS ON RESIDUAL CERTIFICATES........................................89
         Section  5.06     RESTRICTIONS ON TRANSFERABILITY OF CERTIFICATES.......................................90
         Section  5.07     ERISA RESTRICTIONS....................................................................90
         Section  5.08     RULE 144A INFORMATION.................................................................92

                                                    ARTICLE VI
                                          Payments to Certificateholders
         Section  6.01     DISTRIBUTIONS ON THE CERTIFICATES.....................................................93
         Section  6.02     ALLOCATION OF LOSSES..................................................................99
         Section  6.03     PAYMENTS.............................................................................102
         Section  6.04     STATEMENTS TO CERTIFICATEHOLDERS.....................................................102
         Section  6.05     MONTHLY ADVANCES.....................................................................105
         Section  6.06     COMPENSATING INTEREST PAYMENTS.......................................................106

                                                    ARTICLE VII
                                                The Master Servicer
         Section  7.01     LIABILITIES OF THE MASTER SERVICER...................................................107
         Section  7.02     MERGER OR CONSOLIDATION OF THE MASTER SERVICER.......................................107
         Section  7.03     INDEMNIFICATION OF THE TRUSTEE, THE MASTER SERVICER AND THE
                           SECURITIES ADMINISTRATOR.............................................................107
         Section  7.04     LIMITATIONS ON LIABILITY OF THE MASTER SERVICER AND OTHERS...........................108
         Section  7.05     MASTER SERVICER NOT TO RESIGN........................................................109
         Section  7.06     SUCCESSOR MASTER SERVICER............................................................109
         Section  7.07     SALE AND ASSIGNMENT OF MASTER SERVICING..............................................109

                                                   ARTICLE VIII
                                                      Default
         Section  8.01     EVENTS OF DEFAULT....................................................................111
         Section  8.02     TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.............................................113
         Section  8.03     NOTIFICATION TO CERTIFICATEHOLDERS...................................................114
         Section  8.04     WAIVER OF DEFAULTS...................................................................114
         Section  8.05     LIST OF CERTIFICATEHOLDERS...........................................................114

                                                    ARTICLE IX
                              Concerning the Trustee and the Securities Administrator
         Section  9.01     DUTIES OF TRUSTEE....................................................................115
         Section  9.02     CERTAIN MATTERS AFFECTING THE TRUSTEE AND THE SECURITIES


                                                       -ii-

<PAGE>



                           ADMINISTRATOR........................................................................117
         Section  9.03     TRUSTEE AND SECURITIES ADMINISTRATOR NOT LIABLE FOR CERTIFICATES OR
                           MORTGAGE LOANS.......................................................................119
         Section  9.04     TRUSTEE AND SECURITIES ADMINISTRATOR MAY OWN CERTIFICATES............................119
         Section  9.05     TRUSTEE'S AND SECURITIES ADMINISTRATOR'S FEES AND EXPENSES...........................119
         Section  9.06     ELIGIBILITY REQUIREMENTS FOR TRUSTEE AND SECURITIES ADMINISTRATOR....................120
         Section  9.07     INSURANCE............................................................................120
         Section  9.08     RESIGNATION AND REMOVAL OF THE TRUSTEE AND SECURITIES
                           ADMINISTRATOR........................................................................121
         Section  9.09     SUCCESSOR TRUSTEE AND SUCCESSOR SECURITIES ADMINISTRATOR.............................122
         Section  9.10     MERGER OR CONSOLIDATION OF TRUSTEE OR SECURITIES ADMINISTRATOR.......................122
         Section  9.11     APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE........................................122
         Section  9.12     FEDERAL INFORMATION RETURNS AND REPORTS TO CERTIFICATEHOLDERS;
                           REMIC ADMINISTRATION.................................................................124

                                                     ARTICLE X
                                                    Termination
         Section  10.01    TERMINATION UPON REPURCHASE BY THE SELLER OR ITS DESIGNEE OR
                           LIQUIDATION OF THE MORTGAGE LOANS....................................................126
         Section  10.02    ADDITIONAL TERMINATION REQUIREMENTS..................................................129

                                                    ARTICLE XI
                                             Miscellaneous Provisions
         Section  11.01    INTENT OF PARTIES....................................................................130
         Section  11.02    AMENDMENT............................................................................130
         Section  11.03    RECORDATION OF AGREEMENT.............................................................131
         Section  11.04    LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS...........................................131
         Section  11.05    ACTS OF CERTIFICATEHOLDERS...........................................................132
         Section  11.06    GOVERNING LAW........................................................................133
         Section  11.07    NOTICES..............................................................................133
         Section  11.08    SEVERABILITY OF PROVISIONS...........................................................133
         Section  11.09    SUCCESSORS AND ASSIGNS...............................................................134
         Section  11.10    ARTICLE AND SECTION HEADINGS.........................................................134
         Section  11.11    COUNTERPARTS.........................................................................134
         Section  11.12    NOTICE TO RATING AGENCIES............................................................134

                                                     EXHIBITS

Exhibit A-1               -    Form of Class A, Class X and Class I-PO Certificates
Exhibit A-2               -    Form of Class B Certificates
Exhibit A-3               -    Form of Class R Certificates
Exhibit B                 -    Mortgage Loan Schedule
Exhibit C                 -    [Reserved]
Exhibit D                 -    Request for Release of Documents
Exhibit E                 -    Form of Affidavit pursuant to Section 860E(e)(4)
Exhibit F-1               -    Form of Investment Letter


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<PAGE>



Exhibit F-2               -    Form of Rule 144A and Related Matters Certificate
Exhibit G                 -    Form of Custodial Agreement
Exhibit H-1 to H-14       -    Servicing Agreements and Sub-Master Servicing Agreements
Exhibit I                 -    Assignment Agreements
Exhibit J                 -    Mortgage Loan Purchase Agreement
Exhibit K                 -    Schedule of Foreclosure Restricted Loans
Exhibit L                 -    Schedule of Section 3.13 Loans
</TABLE>



                                                       -iv-

<PAGE>



                         POOLING AND SERVICING AGREEMENT

         Pooling and Servicing Agreement dated as of June 1, 2003, among
Structured Asset Mortgage Investments Inc., a Delaware corporation, as seller
(the "Seller"), Deutsche Bank National Trust Company, a a national banking
association, not in its individual capacity but solely as trustee (the
"Trustee"), Wells Fargo Bank Minnesota, National Association, as master servicer
(in such capacity, the "Master Servicer") and as securities administrator (in
such capacity, the "Securities Administrator"), and EMC Mortgage Corporation
("EMC").

                              PRELIMINARY STATEMENT

         On or prior to the Closing Date, the Seller acquired the Mortgage Loans
from EMC. On the Closing Date, the Seller will sell the Mortgage Loans and
certain other property to the Trust Fund and receive in consideration therefor
Certificates evidencing the entire beneficial ownership interest in the Trust
Fund.

         The Trustee on behalf of the Trust shall make an election (as directed
in Section9.12(b)) for the assets constituting REMIC I to be treated for federal
income tax purposes as a REMIC. On the Startup Day, the REMIC I Regular
Interests will be designated "regular interests" in such REMIC and the Class R-I
Certificate will be designated the "residual interest" in such REMIC.

         The Trustee on behalf of the Trust shall make an election (as directed
in Section 9.12(b)) for the assets constituting REMIC II to be treated for
federal income tax purposes as a REMIC. On the Startup Day, the REMIC II Regular
Interests will be designated "regular interests" in such REMIC and the Class
R-II Certificate will be designated the "residual interest" in such REMIC.

         The Trustee on behalf of the Trust shall make an election (as directed
in Section 9.12(b)) for the assets constituting REMIC III to be treated for
federal income tax purposes as a REMIC. On the Startup Day, the REMIC III
Regular Interests will be designated "regular interests" in such REMIC and the
Class R-III Certificate will be designated the "residual interest" in such
REMIC.

         The Trustee on behalf of the Trust shall make an election (as directed
in Section 9.12(b)) for the assets constituting REMIC IV to be treated for
federal income tax purposes as a REMIC. On the Startup Day, the REMIC IV Regular
Certificates will be designated "regular interests" in such REMIC and the Class
R-IV Certificate will be designated the "residual interest" in such REMIC.

         The Group I Mortgage Loans will have an Outstanding Principal Balance
as of the Cut-off Date, after deducting all Scheduled Principal due on or before
the Cut-off Date, of $131,709,507. The initial principal amount of the Group I
Certificates (excluding the Class R-I Certificates) will not exceed such
Outstanding Principal Balance. The Group II Mortgage Loans will have an
Outstanding Principal Balance as of the Cut-off Date, after deducting all
Scheduled Principal due on or before the Cut-off Date, of $42,656,438. The
initial principal amount of the Group II Certificates (excluding the Class R-II,
Class R-III and Class R-IV Certificates) will not exceed such Outstanding
Principal Balance.




<PAGE>



         In consideration of the mutual agreements herein contained, the Seller,
the Master Servicer, the Securities Administrator, EMC and the Trustee agree as
follows:


                                       -2-

<PAGE>



                                    ARTICLE I
                                   Definitions

         Whenever used in this Agreement, the following words and phrases,
unless otherwise expressly provided or unless the context otherwise requires,
shall have the meanings specified in this Article.

         ABN AMRO: ABN AMRO Mortgage Group, Inc., or its successor in interest.

         ABN AMRO SERVICING AGREEMENT: The Servicing Agreement dated as of June
1, 2003 between EMC and ABN AMRO, attached hereto as Exhibit H-1, as modified by
the related Assignment Agreement.

         ACCEPTED MASTER SERVICING PRACTICES: With respect to any Mortgage Loan,
as applicable, either (x) those customary mortgage servicing practices of
prudent mortgage servicing institutions that master service mortgage loans of
the same type and quality as such Mortgage Loan in the jurisdiction where the
related Mortgaged Property is located, to the extent applicable to the Master
Servicer (except in its capacity as successor to a Servicer), (y) as provided in
the applicable Servicing Agreement, to the extent applicable to any Servicer,
but in no event below the standard set forth in clause (x), or (z) as provided
in the applicable Sub-Master Servicing Agreement, to the extent applicable to
any Sub-Master Servicer, but in no event below the standard set forth in clause
(x).

         ACCOUNT: The Master Servicer Collection Account and the Protected
Accounts as the context may require.

         ACCRUED CERTIFICATE INTEREST: For any Certificate (other than the
Principal Only Certificates) for any Distribution Date, the interest accrued
during the related Interest Accrual Period at the applicable Pass-Through Rate
on the Current Principal Amount, or Notional Amount in the case of any Interest
Only Certificate, of such Certificate immediately prior to such Distribution
Date, on the basis of a 360-day year consisting of twelve 30-day months, less
(i) in the case of a Senior Certificate (other than the Principal Only
Certificates), such Certificate's share of any Net Interest Shortfall from the
related Mortgage Loans and, after the related Cross-Over Date, the interest
portion of any Realized Losses on the related Mortgage Loans allocated thereto
in accordance with Section 6.02(g) and (ii) in the case of a Subordinate
Certificate, such Certificate's share of any Net Interest Shortfall from the
related Mortgage Loans and the interest portion of any Realized Losses on the
related Mortgage Loans allocated thereto in accordance with Section 6.02(j).

         ADDITIONAL MASTER SERVICING COMPENSATION: The meaning specified in
Section 3.14.

         AFFILIATE: As to any Person, any other Person controlling, controlled
by or under common control with such Person. "Control" means the power to direct
the management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise. "Controlled" and
"Controlling" have meanings correlative to the foregoing. The Trustee may
conclusively presume that a Person is not an Affiliate of another Person unless
a Responsible Officer of the Trustee has actual knowledge to the contrary.



                                       -3-

<PAGE>



         AGGREGATE EXPENSE RATE: With respect to any Mortgage Loan, the sum of
the Servicing Fee Rate, the Sub-Master Servicing Fee Rate and the Master
Servicing Fee Rate.

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

         ALLIANCE: Alliance Mortgage Company, or its successor in interest.

         ALLIANCE SERVICING AGREEMENT: The Servicing Agreement, dated as of June
1, 2003 between EMC and Alliance, attached hereto as Exhibit H-2, as modified by
the related Assignment Agreement.

         ALLOCABLE SHARE: With respect to each Class of Subordinate
Certificates:

         With respect to any Group I Subordinate Certificate:

         (a) as to any Distribution Date and amounts distributable pursuant to
clauses (i) and (iv) of the definition of Group I Subordinate Optimal Principal
Amount, the fraction, expressed as a percentage, the numerator of which is the
Current Principal Amount of such Class and the denominator of which is the
aggregate Current Principal Amount of all Classes of the Subordinate
Certificates; and

         (b) as to any Distribution Date and amounts distributable pursuant to
clauses (ii), (iii) and (v) of the definition of Group I Subordinate Optimal
Principal Amount, and as to each Class of Group I Subordinate Certificates
(other than the Class of Group I Subordinate Certificates having the lowest
numerical designation as to which the Class Prepayment Distribution Trigger
shall not be applicable) for which (x) the related Class Prepayment Distribution
Trigger has been satisfied on such Distribution Date, the fraction, expressed as
a percentage, the numerator of which is the Current Principal Amount of such
Class and the denominator of which is the aggregate Current Principal Amount of
all such Classes of Group I Subordinate Certificates and (y) the related Class
Prepayment Distribution Trigger has not been satisfied on such Distribution
Date, 0%; provided that if on a Distribution Date, the Current Principal Amount
of any Class of Group I Subordinate Certificates for which the related Class
Prepayment Distribution Trigger was satisfied on such Distribution Date is
reduced to zero, any amounts distributed pursuant to this clause (b), to the
extent of such Class's remaining Allocable Share, shall be distributed to the
remaining Classes of Group I Subordinate Certificates which satisfy the related
Class Prepayment Distribution Trigger and to the Class of Group I Subordinate
Certificates having the lowest numerical designation in reduction of their
respective Current Principal Amounts in the order of their numerical Class
designations.

         With respect to any Group II Subordinate Certificate:

         (b) as to any Distribution Date and amounts distributable pursuant to
clauses (i) and (iv) of the definition of Group II Subordinate Optimal Principal
Amount, the fraction, expressed as a percentage, the numerator of which is the
Current Principal Amount of such Class and the


                                       -4-

<PAGE>


denominator of which is the aggregate Current Principal Amount of all Classes of
the Subordinate Certificates; and

         (b) as to any Distribution Date and amounts distributable pursuant to
clauses (ii), (iii) and (v) of the definition of Group II Subordinate Optimal
Principal Amount, and as to each Class of Group II Subordinate Certificates
(other than the Class of Group II Subordinate Certificates having the lowest
numerical designation as to which the Class Prepayment Distribution Trigger
shall not be applicable) for which (x) the related Class Prepayment Distribution
Trigger has been satisfied on such Distribution Date, the fraction, expressed as
a percentage, the numerator of which is the Current Principal Amount of such
Class and the denominator of which is the aggregate Current Principal Amount of
all such Classes of Group II Subordinate Certificates and (y) the related Class
Prepayment Distribution Trigger has not been satisfied on such Distribution
Date, 0%; provided that if on a Distribution Date, the Current Principal Amount
of any Class of Group II Subordinate Certificates for which the related Class
Prepayment Distribution Trigger was satisfied on such Distribution Date is
reduced to zero, any amounts distributed pursuant to this clause (b), to the
extent of such Class's remaining Allocable Share, shall be distributed to the
remaining Classes of Group II Subordinate Certificates which satisfy the related
Class Prepayment Distribution Trigger and to the Class of Group II Subordinate
Certificates having the lowest numerical designation in reduction of their
respective Current Principal Amounts in the order of their numerical Class
designations.

         APPLICABLE CREDIT RATING: For any long-term deposit or security, a
credit rating of AAA in the case of S&P or Aaa in the case of Moody's. For any
short-term deposit or security, or a rating of A-l+ in the case of S&P or P-1 in
the case of Moody's.

         APPLICABLE STATE LAW: For purposes of Section 9.12(d), the Applicable
State Law shall be (a) the law of the State of New York and (b) such other state
law whose applicability shall have been brought to the attention of the
Securities Administrator and the Trustee by either (i) an Opinion of Counsel
reasonably acceptable to the Securities Administrator and the Trustee delivered
to it by the Master Servicer or the Seller, or (ii) written notice from the
appropriate taxing authority as to the applicability of such state law.

         APPRAISED VALUE: For any Mortgaged Property related to a Mortgage Loan,
the amount set forth as the appraised value of such Mortgaged Property in an
appraisal made for the mortgage originator in connection with its origination of
the related Mortgage Loan.

         ASSIGNMENT AGREEMENTS: The Assignment, Assumption and Recognition
Agreements attached hereto as Exhibit I, whereby the Servicing Agreements for
the WF Servicers and Sub- Master Servicing Agreements were assigned to the
Trustee for the benefit of the Certificateholders.

         ASSIGNMENT OF PROPRIETARY LEASE: With respect to a Cooperative Loan,
the assignment of the related Cooperative Lease from the Mortgagor to the
originator of the Cooperative Loan.

         AVERAGE LOSS SEVERITY: With respect to any period and each Loan Group,
the fraction obtained by dividing (x) the aggregate amount of Realized Losses
for the related Mortgage Loans



                                       -5-

<PAGE>

for such period by (y) the number of related Mortgage Loans which had Realized
Losses for such period.

         BOFA: Bank of America (in its own capacity and as successor to Nations
Banc Mortgage Company), or its successor in interest.

         BOFA SERVICING AGREEMENT: The Master Mortgage Loan Sale and Servicing
Agreement, dated as of October 1, 1996, between BofA and Morgan Stanley Capital,
Inc., together with the Recognition Agreement, dated as of June 1, 2003 between
EMC and BofA, each attached hereto as Exhibit H-3, as modified by the related
Assignment Agreement.

         BANKRUPTCY CODE: The United States Bankruptcy Code, as amended as
codified in 11 U.S.C.
ss.ss. 101-1330.

         BANKRUPTCY LOSS: With respect to any Mortgage Loan, any Deficient
Valuation or Debt Service Reduction related to such Mortgage Loan as reported by
the applicable Servicer or Sub- Master Servicer to the Master Servicer.

         BOOK-ENTRY CERTIFICATES: Initially, all Classes of Certificates other
than the Private Certificates and the Residual Certificates.

         BPO: With respect to any Mortgage Loan, the current broker's price
opinion. In calculating BPO value, a Standard BPO will be used if available. If
not available, a Statistical BPO will be used. If neither are available, the
Appraised Value of the Mortgaged Property will be used. If any BPO provides a
range of values, the lowest value, know as the quick sale value, will be used to
calculate the Current Loan-to-BPO Value Ratio.

         BUSINESS DAY: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which the New York Stock Exchange or Federal Reserve is closed or on
which banking institutions in the jurisdiction in which the Trustee, the Master
Servicer, either Sub-Master Servicer, any Servicer or the Securities
Administrator are authorized or obligated by law or executive order to be
closed.

         CALENDAR QUARTER: January 1 to March 31, April 1 to June 30, July 1 to
September 30, or October 1 to December 31, as applicable.

         CASH FLOW LOAN: Any mortgage loan which was 60 days or more delinquent
as of the Cut-off Date but which had made at least one Scheduled Payment in the
last three months.

         CENDANT: Cendant Mortgage Corporation, or its successor in interest.

         CERTIFICATE: Any mortgage pass-through certificate evidencing a
beneficial ownership interest in the Trust Fund executed and authenticated by
the Trustee in substantially the forms annexed hereto as Exhibits A-1, A-2 and
A-3 with the blanks therein appropriately completed.

         CERTIFICATE GROUP: The Group I-1 Senior Certificates, Group I-2 Senior
Certificates, Group I Senior Certificates and Group II Senior Certificates, as
applicable, and the Group I Subordinate



                                      -6-
<PAGE>

Certificates (to the extent such Certificates represent an interest in the Group
I-1 Mortgage Loans and Group I-2 Mortgage Loans) and Group II Subordinate
Certificates (to the extent such Certificates represent an interest in the Group
II Mortgage Loans).

         CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Certificate registered in the name of the Depository or its nominee.

         CERTIFICATE REGISTER: The register maintained pursuant to Section 5.02.

         CERTIFICATEHOLDER: A Holder of a Certificate.

         CHASE: Chase Manhattan Mortgage Corporation, or its successor in
interest.

         CITI: Citimortgage, Inc. (in its own capacity and as successor to First
Nationwide Mortgage Corporation) or its successors in interest.

         CLASS: With respect to the Certificates, I-F1, I-S1, I-F2, I-S2, I-I1,
I-I2, I-PO, II-A1, R-I, R-II, R-III, R-IV, I-B1, I-B2, I-B3, I-B4, I-B5, I-B6,
II-B1, II-B2, II-B3, II-B4, II-B5 and II-B6.

         CLASS I-PO CERTIFICATE CASH SHORTFALL: As defined in Section
6.01(a)(i)(G) hereof.

         CLASS I-PO CERTIFICATE DEFERRED AMOUNT: With respect to each
Distribution Date, the aggregate of all amounts allocable on such Distribution
Date to the Class I-PO Certificates in respect of the principal portion of
Realized Losses on the Discount Mortgage Loans and any Class I-PO Certificate
Cash Shortfall, and all amounts previously allocated in respect of such losses
and such shortfall to the Class I-PO Certificates and not distributed on prior
Distribution Dates. No interest shall accrue on any Class I-PO Certificate
Deferred Amount.

         CLASS I-PO CERTIFICATE DEFERRED PAYMENT WRITEDOWN AMOUNT: Means, with
respect to any Distribution Date and the Class I-PO Certificates, the amount
distributed to the Class I-PO Certificates on such Distribution Date pursuant to
priority SEVENTH under clause (A) of Section 6.01(a)(i) which amount will be
allocated to the Class I-B6 Certificates, Class I-B5 Certificates, Class I-B4
Certificates, Class I-B3 Certificates, Class I-B2 Certificates and Class I-B1
Certificates, in that order, until the Current Principal Amount of each such
class has been reduced to zero.

         CLASS I-PO CERTIFICATE PRINCIPAL DISTRIBUTION AMOUNT: With respect to
each Distribution Date and the Class I-PO Certificates, means an amount equal to
the sum of the following (but in no event greater than the aggregate Current
Principal Amount of the Class I-PO Certificates immediately prior to such
Distribution Date):

                  (i) the applicable PO Percentage of the principal portion of
         all Scheduled Payments due on each Discount Mortgage Loan on the
         related Due Date, as specified in the amortization schedule at the time
         applicable thereto (after adjustment for previous Principal Prepayments
         but before any adjustment to such amortization schedule by reason of
         any bankruptcy or similar proceeding or any moratorium or similar
         waiver or grace period);



                                      -7-
<PAGE>

                  (ii) the applicable PO Percentage of the Scheduled Principal
         Balance of each Discount Mortgage Loan which was the subject of a
         prepayment in full received by the Master Servicer during the
         applicable Prepayment Period;

                  (iii) the applicable PO Percentage of all partial prepayments
         allocated to principal received during the applicable Prepayment Period
         with respect to each Discount Mortgage Loan;

                  (iv) the lesser of (a) the applicable PO Percentage of the sum
         of (A) all Net Liquidation Proceeds allocable to principal received in
         respect of each Discount Mortgage Loan which became a Liquidated Loan
         during the related Prepayment Period (other than Mortgage Loans
         described in the immediately following clause (B)) and (B) the
         Scheduled Principal Balance of each such Discount Mortgage Loan
         purchased by an insurer from the Trust during the related Prepayment
         Period pursuant to the related primary mortgage insurance policy, if
         any, or otherwise; and (b) the applicable PO Percentage of the sum of
         (A) the Scheduled Principal Balance of each Discount Mortgage Loan
         which became a Liquidated Loan during the related Prepayment Period
         (other than the Discount Mortgage Loans described in the immediately
         following clause (B)) and (B) the Scheduled Principal Balance of each
         such Discount Mortgage Loan that was purchased by an insurer from the
         Trustee during the related Prepayment Period pursuant to the related
         primary mortgage insurance policy, if any or otherwise; and

                  (v) the applicable PO Percentage of the sum of (a) the
         Scheduled Principal Balance of each Discount Mortgage Loan which was
         repurchased by the Mortgage Loan Seller in connection with such
         Distribution Date and (b) the excess, if any, of the Scheduled
         Principal Balance of a Discount Mortgage Loan that has been replaced by
         the Mortgage Loan Seller with a Replacement Mortgage Loan pursuant to
         this Agreement in connection with such Distribution Date over the
         Scheduled Principal Balance of such Replacement Mortgage Loan.

         CLASS PREPAYMENT DISTRIBUTION TRIGGER: For a Class of Group I
Subordinate Certificates or Group II Subordinate Certificates for any
Distribution Date, the Class Prepayment Distribution Trigger is satisfied if the
fraction (expressed as a percentage), the numerator of which is the aggregate
Current Principal Amount of such Class and each Class of Group I Subordinate
Certificates or Group II Subordinate Certificates, respectively, subordinate
thereto, if any, and the denominator of which is the Scheduled Principal Balance
of all of the Group I Mortgage Loans or Group II Mortgage Loans, respectively,
as of the related Due Date, equals or exceeds such percentage calculated as of
the Closing Date.

         CLASS R CERTIFICATES: The Class R-I, Class R-II, Class R-III and Class
R-IV Certificates.

         CLOSING DATE: June 30, 2003.

         CODE: The Internal Revenue Code of 1986, as amended.

         COMPENSATING INTEREST PAYMENT: As defined in Section 6.06.



                                      -8-
<PAGE>

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

         COOPERATIVE APARTMENT: A dwelling unit in a multi-dwelling building
owned or leased by a Cooperative, which unit the Mortgagor has an exclusive
right to occupy pursuant to the terms of a proprietary lease or occupancy
agreement.

         COOPERATIVE LEASE: With respect to a Cooperative Loan, the proprietary
lease or occupancy agreement with respect to the Cooperative Apartment occupied
by the Mortgagor and relating to the related Cooperative Stock, which lease or
agreement confers an exclusive right to the holder of such Cooperative Stock to
occupy such apartment.

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

         COOPERATIVE STOCK: With respect to a Cooperative Loan, the single
outstanding class of stock, partnership interest or other ownership instrument
in the related Cooperative.

         COOPERATIVE STOCK CERTIFICATE: With respect to a Cooperative Loan, the
stock certificate or other instrument evidencing the related Cooperative Stock.

         CORPORATE TRUST OFFICE: The office of the Trustee at which at any
particular time its corporate trust business is 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: Trust Administration BS 03C1. For
purposes of surrenders, transfers and exchanges only, the Corporate Trust Office
shall be located at c/o DTC Transfer Agent Services, 55 Water Street, Jeanette
Park Entrance, New York, New York 10041.

         CORRESPONDING CERTIFICATE: With respect to each REMIC III Regular
Interest set forth below, the Regular Certificate set forth in the table below:


                REMIC III REGULAR INTEREST       REGULAR CERTIFICATE
                           I-F1                      Class I-F1

                           I-F2                      Class I-F2
                           I-I1                      Class I-I1
                           I-PO                      Class I-PO
                          II-A1                      Class II-A1
                           R-IV                      Class R-IV


                                      -9-
<PAGE>

                           I-B1                      Class I-B1
                           I-B2                      Class I-B2
                           I-B3                      Class I-B3
                           I-B4                      Class I-B4
                           I-B5                      Class I-B5
                           I-B6                      Class I-B6
                          II-B1                      Class II-B1
                          II-B2                      Class II-B2
                          II-B3                      Class II-B3
                          II-B4                      Class II-B4
                          II-B5                      Class II-B5
                          II-B6                      Class II-B6

         COUNTRYWIDE: Countrywide Home Loans, Inc., or its successor in
interest.

         CROSS-OVER DATE: The Group I Cross-Over Date or Group II Cross-Over
Date, as applicable.

         CURRENT LOAN-TO-BPO VALUE RATIO: With respect to any Mortgage Loan, the
fraction, expressed as a percentage, the numerator of which is the current
principal balance of the related Mortgage Loan as of the Cut-off Date and the
denominator of which is the current BPO, for the related Mortgaged Property.

         CURRENT LOAN-TO-ORIGINAL VALUE RATIO: With respect to any Mortgage
Loan, the fraction, expressed as a percentage, the numerator of which is the
current principal balance of the related Mortgage Loan as of the Cut-off Date
and the denominator of which is the Original Value of the Mortgaged Property.

         CURRENT PRINCIPAL AMOUNT: With respect to any Certificate (other than
an Interest Only Certificate) as of any Distribution Date, (x) the initial
principal amount of such Certificate plus (y) in the case of any Group II
Certificate, any Deferred Interest added to the Current Principal Amount thereof
in accordance with Section 6.01(f), and reduced by (i) all amounts distributed
on previous Distribution Dates on such Certificate with respect to principal,
(ii) the principal portion of all Realized Losses allocated prior to such
Distribution Date to such Certificate, taking account of the Loss Allocation
Limitation, (iii) in the case of a Subordinate Certificate, such Certificate's
pro rata share, if any, of the applicable Subordinate Certificate Writedown
Amount for previous Distribution Dates and (iv) in the case of a Group I
Subordinate Certificate, any Class I-PO Certificate Deferred Payment Writedown
Amounts allocated to such Certificate on previous Distribution Dates. With
respect to any Class of Certificates (other than an Interest Only Certificate),
the Current Principal Amount thereof will equal the sum of the Current Principal
Amounts of all Certificates in such Class. Notwithstanding the foregoing, solely
for purposes of giving consents, directions, waivers, approvals, requests and
notices, the Class R-I, Class R-II, Class R-III and Class R-IV Certificates
after the Distribution Date on which they each receive the distribution of the
last dollar of their respective original principal amount shall be deemed to
have Current Principal Amounts equal to



                                      -10-
<PAGE>

their respective Current Principal Amounts on the day immediately preceding such
Distribution Date.

         CUSTODIAL AGREEMENT: An agreement, dated as of the Closing Date among
the Seller, the Master Servicer, the Trustee and the Custodian in substantially
the form of Exhibit G hereto.

         CUSTODIAN: Wells Fargo Bank Minnesota, National Association, or any
successor custodian appointed pursuant to the provisions hereof and of the
Custodial Agreement.

         CUT-OFF DATE: June 1, 2003.

         CUT-OFF DATE BALANCE: $174,365,945.

         DEBT SERVICE REDUCTION: Any reduction of the Scheduled Payments which a
Mortgagor is obligated to pay with respect to a Mortgage Loan as a result of any
proceeding under the Bankruptcy Code or any other similar state law or other
proceeding.

         DEFERRED INTEREST: With respect to any Negative Amortization Mortgage
Loan and any Distribution Date, the amount of accrued interest, if any, which
was deferred and added to the Scheduled Principal Balance of such Negative
Amortization Mortgage Loan under the terms of the Mortgage Note during the
related Due Period.

         DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation of
the Mortgaged Property by a court of competent jurisdiction in an amount less
than the then outstanding indebtedness under the Mortgage Loan, which valuation
results from a proceeding initiated under the Bankruptcy Code or any other
similar state law or other proceeding.

         DEPOSITORY: The Depository Trust Company, the nominee of which is Cede
& Co., or any successor thereto.

         DEPOSITORY AGREEMENT: The meaning specified in Subsection 5.01(a)
hereof.

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

         DESIGNATED DEPOSITORY INSTITUTION: A depository institution (commercial
bank, federal savings bank, mutual savings bank or savings and loan association)
or trust company (which may include the Trustee), the deposits of which are
fully insured by the FDIC to the extent provided by law.

         DETERMINATION DATE: With respect to each Mortgage Loan, the
Determination Date as defined in the related Servicing Agreement.

         DISCOUNT MORTGAGE LOAN: A Group I-1 Discount Mortgage Loan or Group I-2
Discount Mortgage Loan, as applicable.



                                      -11-
<PAGE>

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

         DISTRIBUTION ACCOUNT: The trust account or accounts created and
maintained pursuant to Section 4.04, which shall be denominated "Deutsche Bank
National Trust Company, as Trustee f/b/o holders of Structured Asset Mortgage
Investments Inc., Structured Asset Mortgage Investments Trust, Mortgage
Pass-Through Certificates, Series 2003-CL1 - Distribution Account." The
Distribution Account shall be an Eligible Account.

         DISTRIBUTION ACCOUNT DEPOSIT DATE: The Business Day prior to each
Distribution Date.

         DISTRIBUTION DATE: The 25th day of any month, beginning in the month
immediately following the month of the Closing Date, or, if such 25th day is not
a Business Day, the Business Day immediately following.

         DIVERTED AMOUNT: On any Distribution Date, an amount equal to any
Special Hazard Loss allocated to the Group I Senior Certificates or Group II
Senior Certificates, as applicable, for such date pursuant to Section 6.02(e).

         DTC CUSTODIAN: Deutsche Bank National Trust Company, or its successors
in interest as custodian for the Depository.

         DUE DATE: With respect to each Mortgage Loan, the date in each month on
which its Scheduled Payment is due if such due date is the first day of a month
and otherwise is deemed to be the first day of the following month or such other
date specified in the related Servicing Agreement.

         DUE PERIOD: With respect to any Distribution Date and each Mortgage
Loan, the period commencing on the second day of the month preceding the month
in which the Distribution Date occurs and ending at the close of business on the
first day of the month in which the Distribution Date occurs or such other
period specified in the related Servicing Agreement.




                                      -12-
<PAGE>

         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 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 (i))
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 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
Distribution 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 Distribution Account will not have an adverse effect on the then-
current ratings assigned to the Classes of Certificates then rated by the Rating
Agencies). Eligible Accounts may bear interest.

         EMC: EMC Mortgage Corporation.

         EMC SERVICING AGREEMENT: The Servicing Agreement, dated as of June 1,
2003 between EMC and the Seller, attached hereto as Exhibit H-4, as modified by
the related Assignment Agreement.

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

         EVENT OF DEFAULT: An event of default described in Section 8.01.

         EXCESS LIQUIDATION PROCEEDS: To the extent that such amount is not
required by law to be paid to the related Mortgagor, the amount, if any, by
which Liquidation Proceeds with respect to a Liquidated Mortgage Loan exceed the
sum of (i) the Outstanding Principal Balance of such Mortgage Loan and accrued
but unpaid interest at the related Mortgage Interest Rate through the last day
of the month in which the related Liquidation Date occurs, plus (ii) related
Liquidation Expenses.

         FANNIE MAE: Federal National Mortgage Association or any successor
thereto.

         FDIC: Federal Deposit Insurance Corporation or any successor thereto.

         FINAL CERTIFICATION: The certification substantially in the form of
Exhibit Three to the Custodial Agreement.




                                      -13-
<PAGE>


         FORECLOSURE RESTRICTED LOAN: Any Mortgage Loan (other than a Cash Flow
Loan) which was 60 days or more delinquent as of the Cut-Off Date, as indicated
on the schedule attached hereto as Exhibit K.

         FRACTIONAL UNDIVIDED INTEREST: With respect to any Class of
Certificates, the fractional undivided interest evidenced by any Certificate of
such Class the numerator of which is the Current Principal Amount, or Notional
Amount in the case of the Interest Only Certificates, of such Certificate and
the denominator of which is the Current Principal Amount, or Notional Amount in
the case of the Interest Only Certificates, of such Class. With respect to the
Certificates in the aggregate, the fractional undivided interest evidenced by
(i) a Residual Certificate will be deemed to equal 0.25%, (ii) an Interest Only
Certificate will be deemed to equal 1.0% multiplied by a fraction, the numerator
of which is the Notional Amount of such Certificate and the denominator of which
is the aggregate Notional Amount of such respective Class and (iii) a
Certificate of any other Class will be deemed to equal 95.00% multiplied by a
fraction, the numerator of which is the Current Principal Amount of such
Certificate and the denominator of which is the aggregate Current Principal
Amount of all the Certificates; provided, however, the percentage in clause
(iii) above shall be increased by 1.0% upon the retirement of each Class of
Interest Only Certificates.

         FREDDIE MAC: Freddie Mac, formerly the Federal Home Loan Mortgage
Corporation, or any successor thereto.

         GE CAPITAL: GE Capital Mortgage Services, or its successor in interest.

         GE CAPITAL SERVICING AGREEMENT: The Seller's Warranties and Servicing
Agreement, dated as of March 27, 1998 between GE Capital and Hanover Capital
Mortgage Holdings, Inc., together with the Recognition Agreement, dated as of
June 30, 2003 between EMC and GE Capital, each attached hereto as Exhibit H-5,
as modified by the related Assignment Agreement.

         GLOBAL CERTIFICATE: Any Private Certificate registered in the name of
the Depository or its nominee, beneficial interests in which are reflected on
the books of the Depository or on the books of a Person maintaining an account
with such Depository (directly or as an indirect participant in accordance with
the rules of such depository).

         GMAC: GMAC Mortgage Corporation, or its successor in interest.

         GREENPOINT: GreenPoint Mortgage Funding, Inc. (as successor to
Headlands Mortgage Company), or its successor in interest.

         GREENPOINT SERVICING AGREEMENT: The Letter Agreement, dated June 1,
2003 between EMC and GreenPoint, pursuant to which GreenPoint agreed to service
its Mortgage Loans in accordance with the terms of the Servicing Agreement,
dated as of June 1, 2003, between EMC and the Seller, attached hereto as Exhibit
H-6.

         GROSS MARGIN: As to each Group II Mortgage Loan, the fixed percentage
set forth in the related Mortgage Note and indicated on the Mortgage Loan
Schedule which percentage is added to the related Index on each Interest
Adjustment Date to determine (subject to rounding, the



                                      -14-
<PAGE>


minimum and maximum Mortgage Interest Rate and the Periodic Rate Cap) the
Mortgage Interest Rate until the next Interest Adjustment Date.

         GROUP I AVAILABLE FUNDS: An amount equal to the sum of (a) Group I-1
Available Funds and (b) Group I-2 Available Funds.

         GROUP I CERTIFICATES: The Class I-F1, Class I-S1, Class I-F2, Class
I-S2, Class I-I1, Class I-I2, Class I-PO, Class R-I, Class I-B1, Class I-B2,
Class I-B3, Class I-B4, Class I-B5 and Class I-B6 Certificates.

         GROUP I CROSS-OVER DATE: The first Distribution Date on which the
aggregate Current Principal Amount of the Group I Subordinate Certificates has
been reduced to zero (after giving effect to all distributions on such
Distribution Date).

         GROUP I CUT-OFF DATE BALANCE: $131,709,507.

         GROUP I LOSS ALLOCATION LIMITATION: The meaning specified in Section
6.02(d) hereof.

         GROUP I MORTGAGE LOANS: The Group I-1 Mortgage Loans and Group I-2
Mortgage Loans, collectively.

         GROUP I OFFERED SUBORDINATE CERTIFICATES: The Class I-B1, Class I-B2
and Class I-B3 Certificates.

         GROUP I OPTIONAL TERMINATION DATE: The Distribution Date on which the
aggregate Scheduled Principal Balance of the Group I Mortgage Loans is less than
1% of the Group I Cut-off Date Balance.

         GROUP I SENIOR CERTIFICATES: The Class I-F1, Class I-S1, Class I-F2,
Class I-S2, Class I-I1, Class I-I2, Class I-PO and Class R-I Certificates.

         GROUP I SENIOR PERCENTAGE: The Group I-1 Senior Percentage or Group I-2
Senior Percentage, as applicable.

         GROUP I SENIOR PREPAYMENT PERCENTAGE: The Group I-1 Senior Prepayment
Percentage or Group I-2 Senior Prepayment Percentage, as applicable.

         GROUP I SUBORDINATE CERTIFICATES: The Class I-B1, Class I-B2, Class
I-B3, Class I-B4, Class I-B5 and Class I-B6 Certificates.

         GROUP I SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: As to any Distribution
Date and the Group I Subordinate Certificates, an amount equal to the sum,
without duplication, of the following for the Group I-1 Mortgage Loans and Group
I-2 Mortgage Loans (but in no event greater than the aggregate Current Principal
Amount of the Group I Subordinate Certificates immediately prior to such
Distribution Date):



                                      -15-
<PAGE>


                  (i) the applicable Group I Subordinate Percentage of the
                  applicable Non-PO Percentage of the principal portion of all
                  Scheduled Payments due on each Outstanding Mortgage Loan in
                  the related Loan Group on the related Due Date as
                  specified in the amortization schedule at the time applicable
                  thereto (after adjustment for previous Principal Prepayments
                  but before any adjustment to such amortization schedule by
                  reason of any bankruptcy or similar proceeding or any
                  moratorium or similar waiver or grace period);

                  (ii) the applicable Group I Subordinate Prepayment Percentage
                  of the applicable Non-PO Percentage of the Scheduled Principal
                  Balance of each Mortgage Loan in the related Loan Group that
                  was the subject of a Principal Prepayment in full received by
                  the Master Servicer during the related Prepayment Period;

                  (iii) the applicable Group I Subordinate Prepayment Percentage
                  of the applicable Non-PO Percentage of each Principal
                  Prepayment in part received during the related Prepayment
                  Period with respect to each Mortgage Loan in the related Loan
                  Group;

                  (iv) the excess, if any, of (a) all Net Liquidation Proceeds
                  allocable to principal received during the related Prepayment
                  Period in respect of each Liquidated Mortgage Loan in the
                  related Loan Group over (b) the sum of the amounts
                  distributable to the related Senior Certificateholders
                  pursuant to clause (iv) of the related definitions of Group
                  I-1 Senior Optimal Principal Amount, Group I-2 Senior Optimal
                  Principal Amount and Class I-PO Certificate Principal
                  Distribution Amount on such Distribution Date;

                  (v) the applicable Group I Subordinate Prepayment Percentage
                  of the applicable Non-PO Percentage of the sum of (a) the
                  Scheduled Principal Balance of each Mortgage Loan in the
                  related Loan Group which was purchased with respect to such
                  Distribution Date and (b) the difference, if any, between the
                  Scheduled Principal Balance of a Mortgage Loan in the related
                  Loan Group that has been replaced by the Mortgage Loan Seller
                  with a Substitute Mortgage Loan pursuant to the Mortgage Loan
                  Purchase Agreement in connection with such Distribution Date
                  over the Scheduled Principal Balance of such Substitute
                  Mortgage Loan; and

                  (vi) on the Distribution Date on which the Current Principal
                  Amounts of the Group I-1 Senior Certificates (other than the
                  Class I-S11 Certificates) or Group I-2 Senior Certificates
                  (other than the Class I-S2 Certificates) have all been reduced
                  to zero, 100% of the related Group I-1 Senior Optimal
                  Principal Amount or Group I-2 Senior Optimal Principal Amount,
                  as applicable. After the aggregate Current Principal Amount of
                  the Subordinate Certificates of Loan Group I-1 or Loan Group
                  I-2 have been reduced to zero, the Group I Subordinate Optimal
                  Principal Amount for such Loan Group shall be zero.

         GROUP I SUBORDINATE PERCENTAGE: The Group I-1 Subordinate Percentage or
Group I-2 Subordinate Percentage, as applicable.



                                      -16-
<PAGE>


         GROUP I SUBORDINATE PREPAYMENT PERCENTAGE: The Group I-1 Subordinate
Prepayment Percentage or Group I-2 Subordinate Prepayment Percentage, as
applicable.

         GROUP I-1 AVAILABLE FUNDS, GROUP I-2 AVAILABLE FUNDS AND GROUP II
AVAILABLE FUNDS: With respect to any Distribution Date, an amount equal to the
aggregate of the following amounts with respect to the Mortgage Loans in the
related Loan Group: (a) all previously undistributed payments on account of
principal (including the principal portion of Scheduled Payments, Principal
Prepayments and the principal portion of Net Liquidation Proceeds) and all
previously undistributed payments on account of interest received after the
Cut-off Date and on or prior to the related Determination Date, (b) any Monthly
Advances and Compensating Interest Payments by the Servicers or the Master
Servicer with respect to such Distribution Date and (c) any reimbursed amount in
connection with losses on investments of deposits in an account, except:

                  (i) all payments that were due on or before the Cut-off Date;

                  (ii) all Principal Prepayments and Liquidation Proceeds
         received after the applicable Prepayment Period;

                  (iii) all payments, other than Principal Prepayments, that
         represent early receipt of Scheduled Payments due on a date or dates
         subsequent to the related Due Date;

                  (iv) amounts received on particular Mortgage Loans as late
         payments of principal or interest and respecting which, and to the
         extent that, there are any unreimbursed Monthly Advances;

                  (v) amounts representing Monthly Advances determined to be
         Nonrecoverable Advances;

                  (vi) any investment earnings on amounts on deposit in the
         Master Servicer Collection Account and the Distribution Account and
         amounts permitted to be withdrawn from the Master Servicer Collection
         Account and the Distribution Account pursuant to this Agreement;

                  (vii) amounts needed to pay the Servicing Fees, the Sub-Master
         Servicing Fees and the Master Servicing Fees and to reimburse any
         Servicer, either Sub-Master Servicer or the Master Servicer for amounts
         due under the applicable Servicing Agreement, Sub-Master Servicing
         Agreement and the Agreement to the extent such amounts have not been
         retained by, or paid previously to, such Servicer, such Sub-Master
         Servicer or the Master Servicer;

                  (viii) to pay any fees with respect to any lender-paid primary
         mortgage insurance policy; and

                  (ix) any expenses or other amounts reimbursable to the
         Trustee, the Securities Administrator and the Custodian pursuant to
         Sections 2.01(b), 4.05(a), 7.04(c), 9.05 or 10.01(a).



                                      -17-
<PAGE>


         In addition, on each Distribution Date, the Group I-1 Available Funds,
Group I-2 Available or Group II Available Funds shall be increased or decreased,
as applicable, by any Diverted Amount allocated thereto pursuant to Section
6.02(e).

         GROUP I-1 DISCOUNT MORTGAGE LOAN: Any Mortgage Loan in Group I-1 with a
Net Rate less than 8.00%.

         GROUP I-1 MORTGAGE LOANS: The Mortgage Loans identified as such on the
Mortgage Loan Schedule.

         GROUP I-1 NON-DISCOUNT MORTGAGE LOAN: Any Mortgage Loan in Group I-1
with a Net Rate equal to or greater than 8.00%.

         GROUP I-1 SENIOR CERTIFICATES: The Class I-F1 Certificates and Class
I-S1 Certificates.

         GROUP I-1 SENIOR OPTIMAL PRINCIPAL AMOUNT AND GROUP I-2 SENIOR OPTIMAL
PRINCIPAL AMOUNT: With respect to each Distribution Date, an amount equal to the
sum, without duplication, of the following (but in no event greater than the
aggregate Current Principal Amounts of the Group I-1 and Group I-2 Senior
Certificates, as applicable, immediately prior to such Distribution Date):

                  (i) the applicable Group I Senior Percentage of the applicable
         Non-PO Percentage of the principal portion of all Scheduled Payments
         due on each Outstanding Mortgage Loan in the related Loan Group on the
         related Due Date as specified in the amortization schedule at the time
         applicable thereto (after adjustments for previous Principal
         Prepayments but before any adjustment to such amortization schedule by
         reason of any bankruptcy or similar proceeding or any moratorium or
         similar waiver or grace period);

                  (ii) the applicable Group I Senior Prepayment Percentage of
         the applicable Non- PO Percentage of the Scheduled Principal Balance of
         each Mortgage Loan in the related Loan Group which was the subject of a
         Principal Prepayment in full received by the Master Servicer during the
         related Prepayment Period;

                  (iii) the applicable Group I Senior Prepayment Percentage of
         the applicable Non- PO Percentage of all Principal Prepayments in part
         received by the Master Servicer during the related Prepayment Period
         with respect to each Mortgage Loan in the related Loan Group;

                  (iv) the lesser of (a) the applicable Group I Senior
         Prepayment Percentage of the applicable Non-PO Percentage of the sum of
         (A) all Net Liquidation Proceeds allocable to principal received in
         respect of each Mortgage Loan in the related Loan Group which became a
         Liquidated Mortgage Loan during the related Prepayment Period (other
         than Mortgage Loans described in the immediately following clause (B))
         and (B) the Scheduled Principal Balance of each such Mortgage Loan in
         the related Loan Group purchased by an insurer from the Trust during
         the related Prepayment Period pursuant to the related Primary



                                      -18-
<PAGE>


         Mortgage Insurance Policy, if any, or otherwise; and (b) the applicable
         Group I Senior Percentage of the applicable Non-PO Percentage of the
         sum of (A) the Scheduled Principal Balance of each Mortgage Loan in the
         related Loan Group which became a Liquidated Mortgage Loan during the
         related Prepayment Period (other than the Mortgage Loans described in
         the immediately following clause (B)) and (B) the Scheduled Principal
         Balance of each such Mortgage Loan in the related Loan Group that was
         purchased by an insurer from the Trust during the related Prepayment
         Period pursuant to the related Primary Mortgage Insurance Policy, if
         any or otherwise;

                  (v) the applicable Group I Senior Prepayment Percentage of the
         applicable Non- PO Percentage of the sum of (a) the Scheduled Principal
         Balance of each Mortgage Loan in the related Loan Group which was
         repurchased by the Mortgage Loan Seller in connection with such
         Distribution Date and (b) the excess, if any, of the Scheduled
         Principal Balance of a Mortgage Loan in the related Loan Group that has
         been replaced by the Mortgage Loan Seller with a substitute Mortgage
         Loan pursuant to the Mortgage Loan Purchase Agreement in connection
         with such Distribution Date over the Scheduled Principal Balance of
         such substitute Mortgage Loan; and

                  (vi) any Diverted Amount allocated to the Group I-1 Senior
         Optimal Principal Amount or Group I-2 Senior Optimal Principal Amount,
         as applicable for such Distribution Date;

         MINUS

                  (vii) any Diverted Amount from the Group I-1 Senior Optimal
         Principal Amount or Group I-2 Senior Optimal Principal Amount, as
         applicable, for such Distribution Date.

         GROUP I-1 SENIOR PERCENTAGE: Initially, 96.93%. On any Distribution
Date, the lesser of (i) 100% and (ii) the percentage (carried to six places
rounded up) obtained by dividing the aggregate Current Principal Amount of the
Group I-1 Senior Certificates (other than the Interest Only Certificates)
immediately preceding such Distribution Date by the aggregate Scheduled
Principal Balance of the Group I-1 Mortgage Loans (other than the PO Percentage
of the Group I-1 Discount Mortgage Loans) as of the beginning of the related Due
Period.




                                      -19-
<PAGE>


         GROUP I-1 SENIOR PREPAYMENT PERCENTAGE: On any Distribution Date
occurring during the periods set forth below, as follows:


Period (dates inclusive)             Group 1 Senior Prepayment Percentage
--------------------------------------------------------------------------------
July 25, 2003 - June 25, 2008        100%
July 25, 2008 - June 25, 2009        Group I-1 Senior Percentage plus 70% of the
                                     Group I-1 Subordinate Percentage
July 25, 2009 - June 25, 2010        Group I-1 Senior Percentage plus 60% of the
                                     Group I-1 Subordinate Percentage
July 25, 2010 - June 25, 2011        Group I-1 Senior Percentage plus 40% of the
                                     Group I-1 Subordinate Percentage
July 25, 2011 - June 25, 2012        Group I-1 Senior Percentage plus 20% of the
                                     Group I-1 Subordinate Percentage
July 25, 2012 and thereafter         Group I-1 Senior Percentage

         In addition, no reduction of the Group I-1 Senior Prepayment Percentage
shall occur on any Distribution Date unless, as of the last day of the month
preceding such Distribution Date, (A) the aggregate Scheduled Principal Balance
of the Group I Mortgage Loans delinquent 60 days or more (including for this
purpose any such Group I Mortgage Loans in foreclosure and Group I Mortgage
Loans with respect to which the related Mortgaged Property has been acquired by
the Trust), averaged over the last six months, as a percentage of the sum of the
aggregate Current Principal Amount of the Group I Subordinate Certificates does
not exceed 50%; and (B) cumulative Realized Losses on the Group I Mortgage Loans
do not exceed (a) 30% of the Original Group I Subordinate Principal Balance if
such Distribution Date occurs between and including July 2008 and June 2009, (b)
35% of the Original Group I Subordinate Principal Balance if such Distribution
Date occurs between and including July 2009 and June 2010, (c) 40% of the
Original Group I Subordinate Principal Balance if such Distribution Date occurs
between and including July 2010 and June 2011, (d) 45% of the Original Group I
Subordinate Principal Balance if such Distribution Date occurs between and
including July 2011 and June 2012, and (e) 50% of the Original group I
Subordinate Principal Balance if such Distribution Date occurs during or after
July 2012.

         Notwithstanding the foregoing, if on any Distribution Date the Group
I-1 Senior Percentage exceeds the Group I-1 Senior Percentage as of the Cut-Off
Date, the Group I-1 Senior Prepayment Percentage for such Distribution Date will
equal 100%. On the Distribution Date on which the Current Principal Amounts of
the Group I-1 Senior Certificates are reduced to zero, the Group I-1 Senior
Prepayment Percentage shall be the minimum percentage sufficient to effect such
reduction and thereafter shall be zero.

         GROUP I-1 SUBORDINATE AMOUNT: On any date of determination, the excess
of the aggregate Scheduled Principal Balance of the Group I-1 Mortgage Loans
(other than the PO Percentage of the Group I-1 Discount Mortgage Loans) as of
such date over the aggregate Principal Balance of the Group I-1 Senior
Certificates then outstanding.

         GROUP I-1 SUBORDINATE PERCENTAGE: On any Distribution Date, 100% minus
the Group I-1 Senior Percentage.



                                      -20-
<PAGE>


         GROUP I-1 SUBORDINATE PREPAYMENT PERCENTAGE: With respect to the Group
I-1 Mortgage Loans, on any Distribution Date, 100% minus the Group I-1 Senior
Prepayment Percentage, except that on any Distribution Date after the Current
Principal Amounts of the Group I-1 Senior Certificates (other than the Interest
Only Certificates) have each been reduced to zero, if (a) the weighted average
of the Group I Subordinate Percentages on such Distribution Date equals or
exceeds two times the initial weighted average of the Group I Subordinate
Percentages and (b) the aggregate Scheduled Principal Balance of the Group I
Mortgage Loans delinquent 60 days or more (including for this purpose any such
Mortgage Loans in foreclosure and Mortgage Loans with respect to which the
related Mortgaged Property has been acquired by the Trust), averaged over the
last six months, as a percentage of the sum of the aggregate Current Principal
Amount of the Group I Subordinate Certificates does not exceed 100%, the Group
I-1 Subordinate Prepayment Percentage will equal 100%. If the test set forth in
the preceding sentence is not satisfied on any Distribution Date after the
Current Principal Amount of the Group I-1 Senior Certificates have each been
reduced to zero, then the Group I-1 Subordinate Prepayment Percentage will equal
zero for such Distribution Date.

         GROUP I-2 DISCOUNT MORTGAGE LOAN: Any Mortgage Loan in Group I-2 with a
Net Rate less than 7.50%.

         GROUP I-2 MORTGAGE LOANS: The Mortgage Loans identified as such on the
Mortgage Loan Schedule.

         GROUP I-2 NON-DISCOUNT MORTGAGE LOAN: Any Mortgage Loan in Group I-2
with a Net Rate equal to or greater than 7.50%.

         GROUP I-2 SENIOR CERTIFICATES: The Class I-F2, Class I-S2 Certificates
and Class R-I Certificates.

         GROUP I-2 SENIOR PERCENTAGE: Initially, 96.92%. On any Distribution
Date, the lesser of (i) 100% and (ii) the percentage (carried to six places
rounded up) obtained by dividing the aggregate Current Principal Amount of the
Group I-2 Senior Certificates (other than the Interest Only Certificates)
immediately preceding such Distribution Date by the aggregate Scheduled
Principal Balance of the Group I-2 Mortgage Loans (other than the PO Percentage
of the Group I-2 Discount Mortgage Loans) as of the beginning of the related Due
Period.



                                      -21-
<PAGE>


         GROUP I-2 SENIOR PREPAYMENT PERCENTAGE: On any Distribution Date
occurring during the periods set forth below, as follows:


Period (dates inclusive)            Group 1 Senior Prepayment Percentage
-------------------------------------------------------------------------------
July 25, 2003 - June 25, 2008       100%
July 25, 2008 - June 25, 2009       Group I-2 Senior Percentage plus 70% of the
                                    Group I-2 Subordinate Percentage
July 25, 2009 - June 25, 2010       Group I-2 Senior Percentage plus 60% of the
                                    Group I-2 Subordinate Percentage
July 25, 2010 - June 25, 2011       Group I-2 Senior Percentage plus 40% of the
                                    Group I-2 Subordinate Percentage
July 25, 2011 - June 25, 2012       Group I-2 Senior Percentage plus 20% of the
                                    Group I-2 Subordinate Percentage
July 25, 2012 and thereafter        Group I-2 Senior Percentage

         In addition, no reduction of the Group I-2 Senior Prepayment Percentage
shall occur on any Distribution Date unless, as of the last day of the month
preceding such Distribution Date, (A) the aggregate Scheduled Principal Balance
of the Group I Mortgage Loans delinquent 60 days or more (including for this
purpose any such Mortgage Loans in foreclosure and Mortgage Loans with respect
to which the related Mortgaged Property has been acquired by the Trust),
averaged over the last six months, as a percentage of the sum of the aggregate
Current Principal Amount of the Group I Subordinate Certificates does not exceed
50%; and (B) cumulative Realized Losses on the Group I Mortgage Loans do not
exceed (a) 30% of the Original Group I Subordinate Principal Balance if such
Distribution Date occurs between and including July 2008 and June 2009, (b) 35%
of the Original Group I Subordinate Principal Balance if such Distribution Date
occurs between and including July 2009 and June 2010, (c) 40% of the Original
Group I Subordinate Principal Balance if such Distribution Date occurs between
and including July 2010 and June 2011, (d) 45% of the Original Group I
Subordinate Principal Balance if such Distribution Date occurs between and
including July 2011 and June 2012, and (e) 50% of the Original Group I
Subordinate Principal Balance if such Distribution Date occurs during or after
July 2012.

         Notwithstanding the foregoing, if on any Distribution Date the Group
I-2 Senior Percentage exceeds the Group I-2 Senior Percentage as of the Cut-Off
Date, the Group I-2 Senior Prepayment Percentage for such Distribution Date will
equal 100%. On the Distribution Date on which the Current Principal Amounts of
the Group I-2 Senior Certificates are reduced to zero, the Group I-2 Senior
Prepayment Percentage shall be the minimum percentage sufficient to effect such
reduction and thereafter shall be zero.

         GROUP I-2 SUBORDINATE AMOUNT: On any date of determination, the excess
of the aggregate Scheduled Principal Balance of the Group I-2 Mortgage Loans
(other than the PO Percentage of the Group I-2 Discount Mortgage Loans) as of
such date over the aggregate Principal Balance of the Group I-2 Senior
Certificates then outstanding.

         GROUP I-2 SUBORDINATE PERCENTAGE: On any Distribution Date, 100% minus
the Group I-2 Senior Percentage.




                                      -22-
<PAGE>


         GROUP I-2 SUBORDINATE PREPAYMENT PERCENTAGE: With respect to the Group
I-2 Mortgage Loans, on any Distribution Date, 100% minus the Group I-2 Senior
Prepayment Percentage, except that on any Distribution Date after the Current
Principal Amounts of the Group I-2 Senior Certificates have each been reduced to
zero, if (a) the weighted average of the Group I Subordinate Percentages on such
Distribution Date equals or exceeds two times the initial weighted average of
the Group I Subordinate Percentages and (b) the aggregate Scheduled Principal
Balance of the Group I Mortgage Loans delinquent 60 days or more (including for
this purpose any such Mortgage Loans in foreclosure and Mortgage Loans with
respect to which the related Mortgaged Property has been acquired by the Trust),
averaged over the last six months, as a percentage of the sum of the aggregate
Current Principal Amount of the Group I Subordinate Certificates does not exceed
100%, the Group I-2 Subordinate Prepayment Percentage will equal 100%. If the
test set forth in the preceding sentence is not satisfied on any Distribution
Date after the Current Principal Amount of the Group I-2 Senior Certificates
have each been reduced to zero, then the Group I-2 Subordinate Prepayment
Percentage will equal zero for such Distribution Date.

         GROUP II CERTIFICATES: The Class II-A1, Class R-II, Class R-III, Class
R-IV, Class II-B1, Class II-B2, Class II-B3, Class II-B4, Class II-B5 and Class
II-B6 Certificates.

         GROUP II CROSS-OVER DATE: The first Distribution Date on which the
aggregate Current Principal Amount of the Group II Subordinate Certificates has
been reduced to zero (after giving effect to all distributions on such
Distribution Date).

         GROUP II CUT-OFF DATE BALANCE: $42,656,438.

         GROUP II LOSS ALLOCATION LIMITATION: The meaning specified in Section
6.02(d) hereof.

         GROUP II MORTGAGE LOANS: The Mortgage Loans identified as such on the
Mortgage Loan Schedule.

         GROUP II OFFERED SUBORDINATE CERTIFICATES: The Class II-B1, Class II-B2
and Class II-B3 Certificates.

         GROUP II OPTIONAL TERMINATION DATE: The Distribution Date on which the
aggregate Scheduled Principal Balance of the Group II Mortgage Loans is less
than 5% of the Group II Cut-off Date Balance.

         GROUP II SENIOR CERTIFICATES: The Class II-A1 Certificates, Class R-II,
Class R-III and Class R-IV Certificates.

         GROUP II SENIOR OPTIMAL PRINCIPAL AMOUNT: With respect to each
Distribution Date, an amount equal to the sum, without duplication, of the
following (but in no event greater than the aggregate Current Principal Amounts
of the Group II Senior Certificates immediately prior to such Distribution
Date):

                  (i) the Group II Senior Percentage of the principal portion of
         all Scheduled Payments due on each Outstanding Group II Mortgage Loan
         on the related Due Date



                                      -23-
<PAGE>


         as specified in the amortization schedule at the time applicable
         thereto (after adjustments for previous Principal Prepayments but
         before any adjustment to such amortization schedule by reason of any
         bankruptcy or similar proceeding or any moratorium or similar waiver or
         grace period);

                  (ii) the Group II Senior Prepayment Percentage of the
         Scheduled Principal Balance of each Group II Mortgage Loan which was
         the subject of a Principal Prepayment in full received by the Master
         Servicer during the related Prepayment Period;

                  (iii) the Group II Senior Prepayment Percentage of all
         Principal Prepayments in part received by the Master Servicer during
         the related Prepayment Period with respect to each Group II Mortgage
         Loan;

                  (iv) the lesser of (a) the Group II Senior Prepayment
         Percentage of the sum of (A) all Net Liquidation Proceeds allocable to
         principal received in respect of each Group II Mortgage Loan which
         became a Liquidated Mortgage Loan during the related Prepayment Period
         (other than Mortgage Loans described in the immediately following
         clause (B)) and (B) the Scheduled Principal Balance of each such Group
         II Mortgage Loan purchased by an insurer from the Trust during the
         related Prepayment Period pursuant to the related Primary Mortgage
         Insurance Policy, if any, or otherwise; and (b) the Group II Senior
         Percentage of the sum of (A) the Scheduled Principal Balance of each
         Group II Mortgage Loan which became a Liquidated Mortgage Loan during
         the related Prepayment Period (other than the Mortgage Loans described
         in the immediately following clause (B)) and (B) the Scheduled
         Principal Balance of each such Group II Mortgage Loan that was
         purchased by an insurer from the Trust during the related Prepayment
         Period pursuant to the related Primary Mortgage Insurance Policy, if
         any or otherwise;

                  (v) the Group II Senior Prepayment Percentage of the sum of
         (a) the Scheduled Principal Balance of each Group II Mortgage Loan
         which was repurchased by the Mortgage Loan Seller in connection with
         such Distribution Date and (b) the excess, if any, of the Scheduled
         Principal Balance of a Group II Mortgage Loan that has been replaced by
         the Mortgage Loan Seller with a substitute Mortgage Loan pursuant to
         the Mortgage Loan Purchase Agreement in connection with such
         Distribution Date over the Scheduled Principal Balance of such
         substitute Mortgage Loan;

                  (vi) any Diverted Amount allocated to the Group II Senior
         Optimal Principal Amount for such Distribution Date;

         MINUS

                  (vii) any Diverted Amount from the Group II Senior Optimal
         Principal Amount for such Distribution Date.

         GROUP II SENIOR PERCENTAGE: Initially, 97.20%. On any Distribution
Date, the lesser of (i) 100% and (ii) the percentage (carried to six places
rounded up) obtained by dividing the aggregate Current Principal Amount of the
Group II Senior Certificates immediately preceding such



                                      -24-
<PAGE>


Distribution Date by the aggregate Scheduled Principal Balance of the Group II
Mortgage Loans as of the beginning of the related Due Period.

         GROUP II SENIOR PREPAYMENT PERCENTAGE: On any Distribution Date
occurring during the periods set forth below, as follows:


Period (dates inclusive)           Group 2 Senior Prepayment Percentage
-----------------------------------------------------------------------------
July 25, 2003 - June 25, 2010      100%
July 25, 2010 - June 25, 2011      Group II Senior Percentage plus 70% of the
                                   Group II Subordinate Percentage
July 25, 2011 - June 25, 2012      Group II Senior Percentage plus 60% of the
                                   Group II Subordinate Percentage
July 25, 2012 - June 25, 2013      Group II Senior Percentage plus 40% of the
                                   Group II Subordinate Percentage
July 25, 2013 - June 25, 2014      Group II Senior Percentage plus 20% of the
                                   Group II Subordinate Percentage
July 25, 2014 and thereafter       Group II Senior Percentage

         In addition, no reduction of the Group II Senior Prepayment Percentage
shall occur on any Distribution Date unless, as of the last day of the month
preceding such Distribution Date, (A) the aggregate Scheduled Principal Balance
of the Group II Mortgage Loans delinquent 60 days or more (including for this
purpose any such Mortgage Loans in foreclosure and Mortgage Loans with respect
to which the related Mortgaged Property has been acquired by the Trust),
averaged over the last six months, as a percentage of the sum of the aggregate
Current Principal Amount of the Group II Subordinate Certificates does not
exceed 50%; and (B) cumulative Realized Losses on the Group II Mortgage Loans do
not exceed (a) 30% of the Original Group II Subordinate Principal Balance if
such Distribution Date occurs between and including July 2010 and June 2011, (b)
35% of the Original Group II Subordinate Principal Balance if such Distribution
Date occurs between and including July 2011 and June 2012, (c) 40% of the
Original Group II Subordinate Principal Balance if such Distribution Date occurs
between and including July 2012 and June 2013, (d) 45% of the Original Group II
Subordinate Principal Balance if such Distribution Date occurs between and
including July 2013 and June 2014, and (e) 50% of the Original Group II
Subordinate Principal Balance if such Distribution Date occurs during or after
July 2014.

         In addition, if on any Distribution Date the Group II Subordinate
Percentage is equal to or greater than two times the initial Group II
Subordinate Percentage, and (a) the aggregate Scheduled Principal Balance of the
Group II Mortgage Loans delinquent 60 days or more (including for this purpose
any such Mortgage Loans in foreclosure and such Mortgage Loans with respect to
which the related Mortgaged Property has been acquired by the Trust), averaged
over the last six months, as a percentage of the aggregate Current Principal
Amount of the Group II Subordinate Certificates does not exceed 50% and (b)(i)
on or prior to the Distribution Date in July 2006 cumulative Realized Losses on
the Group II Mortgage Loans as of the end of the related Prepayment Period do
not exceed 20% of the Original Group II Subordinate Principal Balance and (ii)
after the Distribution Date in July 2006 cumulative Realized Losses on the Group
II Mortgage Loans as of the end of the related Prepayment Period do not exceed
30% of the Original Group I Subordinate



                                      -25-
<PAGE>


Principal Balance, then, the Group II Senior Prepayment Percentage for such
Distribution Date will equal the Group II Senior Percentage; provided, however,
if on such Distribution Date the Group II Subordinate Percentage is equal to or
greater than two times the initial Group II Subordinate Percentage on or prior
to the Distribution Date occurring in July 2006 and the above delinquency and
loss tests are met, then the Group II Senior Prepayment Percentage for such
Distribution Date will equal the Group II Senior Percentage plus 50% of the
Group II Subordinate Percentage.

         Notwithstanding the foregoing, if on any Distribution Date the Group II
Senior Percentage exceeds the Group II Senior Percentage as of the Cut-Off Date,
the Group II Senior Prepayment Percentage for such Distribution Date will equal
100%. On the Distribution Date on which the Current Principal Amounts of the
Group II Senior Certificates are reduced to zero, the Group II Senior Prepayment
Percentage shall be the minimum percentage sufficient to effect such reduction
and thereafter shall be zero.

         GROUP II SUBORDINATE CERTIFICATES: The Class II-B1, Class II-B2, Class
II-B3, Class II-B4, Class II-B5 and Class II-B6 Certificates.

         GROUP II SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: As to any Distribution
Date and the Group II Subordinate Certificates, an amount equal to the sum,
without duplication, of the following for the Group II Mortgage Loans (but in no
event greater than the aggregate Current Principal Amount of the Group II
Subordinate Certificates immediately prior to such Distribution Date):

                  (i) the Group II Subordinate Percentage of the principal
                  portion of all Scheduled Payments due on each Outstanding
                  Mortgage Loan in Loan Group II on the related Due Date as
                  specified in the amortization schedule at the time applicable
                  thereto (after adjustment for previous Principal Prepayments
                  but before any adjustment to such amortization schedule by
                  reason of any bankruptcy or similar proceeding or any
                  moratorium or similar waiver or grace period);

                  (ii) the Group II Subordinate Prepayment Percentage of the
                  Scheduled Principal Balance of each Group II Mortgage Loan
                  that was the subject of a Principal Prepayment in full
                  received by the Master Servicer during the related Prepayment
                  Period;

                  (iii) the Group II Subordinate Prepayment Percentage of each
                  Principal Prepayment in part received during the related
                  Prepayment Period with respect to each Group II Mortgage Loan;

                  (iv) the excess, if any, of (a) all Net Liquidation Proceeds
                  allocable to principal received during the related Prepayment
                  Period in respect of each Liquidated Mortgage Loan in Loan
                  Group II over (b) the sum of the amounts distributable to the
                  Group II Senior Certificates pursuant to clause (iv) of the
                  definition of Group II Senior Optimal Principal Amount on such
                  Distribution Date;

                  (v) the Group II Subordinate Prepayment Percentage of the sum
                  of (a) the Scheduled Principal Balance of each Group II
                  Mortgage Loan which was purchased



                                      -26-
<PAGE>


                  with respect to such Distribution Date and (b) the difference,
                  if any, between the Scheduled Principal Balance of a Group II
                  Mortgage Loan that has been replaced by the Mortgage Loan
                  Seller with a Substitute Mortgage Loan pursuant to the
                  Mortgage Loan Purchase Agreement in connection with such
                  Distribution Date over the Scheduled Principal Balance of such
                  Substitute Mortgage Loan; and

                  (vi) on the Distribution Date on which the Current Principal
                  Amounts of the Group II Senior Certificates have all been
                  reduced to zero, 100% of the related Group II Senior Optimal
                  Principal Amount. After the aggregate Current Principal Amount
                  of the Group II Subordinate Certificates has been reduced to
                  zero, the Group II Subordinate Optimal Principal Amount shall
                  be zero.

         GROUP II SUBORDINATE PERCENTAGE: On any Distribution Date, 100% minus
the Group II Senior Percentage.

         GROUP II SUBORDINATE PREPAYMENT PERCENTAGE: With respect to the Group
II Mortgage Loans, on any Distribution Date, 100% minus the Group II Senior
Prepayment Percentage.

         HOLDER: The Person in whose name a Certificate is registered in the
Certificate Register, except that, subject to Subsections 11.02(b) and 11.05(e),
solely for the purpose of giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Seller, the Master Servicer or the
Trustee or any Affiliate thereof shall be deemed not to be outstanding and the
Fractional Undivided Interest evidenced thereby shall not be taken into account
in determining whether the requisite percentage of Fractional Undivided
Interests necessary to effect any such consent has been obtained.

         IMPAC: Impac Funding Corporation, or its successor in interest.

         IMPAC SERVICERS: HomeComing Financial and Wendover Funding, Inc.

         IMPAC SERVICING AGREEMENTS: The servicing agreements pursuant to which
each of the Impac Servicers service their respective Mortgage Loans.

         IMPAC SUB-MASTER SERVICING AGREEMENT: The Mortgage Loan Purchase
Agreement, dated as of January 26, 2003, as between EMC and Impac; provided,
that to the extent that any provision of this agreement makes reference to the
servicing standards set forth in the Impac Sub-Master Servicing Agreement, such
reference shall be deemed to be to the servicing standards set forth in the
Pooling and Servicing Agreement, dated as of February 1, 2003 among Impac
Secured Assets Corp., Impac Funding Corporation and Deutsche Bank National Trust
Company, attached hereto as Exhibit H-7, as modified by the related Assignment
Agreement.

         INDEMNIFIED PERSONS: The Trustee, the Master Servicer, the Custodian
and the Securities Administrator and their officers, directors, agents and
employees and, with respect to the Trustee, any separate co-trustee and its
officers, directors, agents and employees.



                                      -27-
<PAGE>


         INDEPENDENT: When used with respect to any specified Person, this term
means that such Person (a) is in fact independent of the Seller or the Master
Servicer and of any Affiliate of the Seller or the Master Servicer, (b) does not
have any direct financial interest or any material indirect financial interest
in the Seller or the Master Servicer or any Affiliate of the Seller or the
Master Servicer and (c) is not connected with the Seller or the Master Servicer
or any Affiliate as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.

         INDEX: The index, if any, specified in a Mortgage Note for a Group II
Mortgage Loan by reference to which the related Mortgage Interest Rate will be
adjusted from time to time.

         INDIVIDUAL CERTIFICATE: Any Private Certificate registered in the name
of the Holder other than the Depository or its nominee.

         INITIAL CERTIFICATION: The certification substantially in the form of
Exhibit One to the Custodial Agreement.

         INSTITUTIONAL ACCREDITED INVESTOR: Any Person meeting the requirements
of Rule 501(a)(l), (2), (3) or (7) of Regulation D under the Securities Act or
any entity all of the equity holders in which come within such paragraphs.

         INSURANCE POLICY: With respect to any Mortgage Loan, any standard
hazard insurance policy, flood insurance policy or title insurance policy.

         INSURANCE PROCEEDS: Amounts paid by the insurer under any Insurance
Policy covering any Mortgage Loan or Mortgaged Property other than amounts
required to be paid over to the Mortgagor pursuant to law or the related
Mortgage Note or Security Instrument and other than amounts used to repair or
restore the Mortgaged Property or to reimburse insured expenses.

         INTEREST ACCRUAL PERIOD: With respect to each Distribution Date, and
each Class of Certificates (other than the Group I-1 Senior Certificates and
Group I-2 Senior Certificates), the calendar month preceding the month in which
such Distribution Date occurs. With respect to each Distribution Date, and the
Group I-1 Senior Certificates and Group I-2 Senior Certificates, the period from
and including the 25th day of the calendar month preceding the month in which
the Distribution Date occurs to and including the 24th day of the calendar month
in which such Distribution Date occurs.

         INTEREST ADJUSTMENT DATE: With respect to a Group II Mortgage Loan, the
date, if any, specified in the related Mortgage Note on which the Mortgage
Interest Rate is subject to adjustment.

         INTEREST DETERMINATION DATE: With respect to each Distribution Date,
the second LIBOR Business Day immediately preceding the commencement of the
related Interest Accrual Period.

         INTEREST ONLY CERTIFICATES: The Class I-S1, Class I-S2, Class I-I1 and
Class I-I2 Certificates.

         INTEREST SHORTFALL: With respect to any Distribution Date and each
Mortgage Loan that during the related Prepayment Period was the subject of a
Principal Prepayment, constitutes a Relief



                                      -28-
<PAGE>


Act Mortgage Loan or for which accrued interest was deferred and added to the
Scheduled Principal Balance of such Mortgage Loan, an amount determined as
follows:

         (a) Partial principal prepayments received during the relevant
Prepayment Period: The difference between (i) one month's interest at the
applicable Net Rate on the amount of such prepayment and (ii) the amount of
interest for the calendar month of such prepayment (adjusted to the applicable
Net Rate) received at the time of such prepayment;

         (b) Principal prepayments in full received during the relevant
Prepayment Period: The difference between (i) one month's interest at the
applicable Net Rate on the Scheduled Principal Balance of such Mortgage Loan
immediately prior to such prepayment and (ii) the amount of interest for the
calendar month of such prepayment (adjusted to the applicable Net Rate) received
at the time of such prepayment;

         (c) Relief Act Mortgage Loans: As to any Relief Act Mortgage Loan, the
excess of (i) 30 days' interest (or, in the case of a principal prepayment in
full, interest to the date of prepayment) on the Scheduled Principal Balance
thereof (or, in the case of a principal prepayment in part, on the amount so
prepaid) at the related Net Rate over (ii) 30 days' interest (or, in the case of
a principal prepayment in full, interest to the date of prepayment) on such
Scheduled Principal Balance (or, in the case of a Principal Prepayment in part,
on the amount so prepaid) at the Net Rate required to be paid by the Mortgagor
as limited by application of the Relief Act; and

         (d) Negative Amortization Loans: As to any Negative Amortization Loan,
the amount of Deferred Interest for the related Due Period.

         INTERIM CERTIFICATION: The certification substantially in the form of
Exhibit Two to the Custodial Agreement.

         INVESTMENT LETTER: The letter to be furnished by each Institutional
Accredited Investor which purchases any of the Private Certificates in
connection with such purchase, substantially in the form set forth as Exhibit
F-1 hereto.

         LIBERTY: Liberty Savings Bank, FSB, or its successor in interest.

         LIBERTY SERVICING AGREEMENT: The Servicing Agreement, dated as of
January 1, 1999, as between Hanover Mortgage Holdings, Inc. and Hanover Capital
Mortgage Corporation, together with the Recognition Agreement, dated as of June
1, 2003 between EMC and Liberty, each attached hereto as Exhibit H-8, as
modified by the related Assignment Agreement.

         LIBOR: With respect to any Distribution Date, the arithmetic mean of
the London interbank offered rate quotations for one-month U.S. Dollar deposits,
expressed on a per annum basis, determined in accordance with Section 1.02.

         LIBOR BUSINESS DAY: Any day other than (i) a Saturday or Sunday or (ii)
a day on which banking institutions in London, England and New York City are
required or authorized to by law to be closed.



                                      -29-
<PAGE>


         LIQUIDATED MORTGAGE LOAN: Any defaulted Mortgage Loan as to which the
related Servicer, Sub-Master Servicer or the Master Servicer has determined that
all amounts it expects to recover from or on account of such Mortgage Loan have
been recovered.

         LIQUIDATION DATE: With respect to any Liquidated Mortgage Loan, the
date on which the Master Servicer, the related Sub-Master Servicer or the
related Servicer has certified that such Mortgage Loan has become a Liquidated
Mortgage Loan.

         LIQUIDATION EXPENSES: With respect to a Mortgage Loan in liquidation,
unreimbursed expenses paid or incurred by or for the account of the Master
Servicer, the related Sub-Master Servicer or the related Servicer in connection
with the liquidation of such Mortgage Loan and the related Mortgage Property,
such expenses including (a) property protection expenses, (b) property sales
expenses, (c) foreclosure and sale costs, including court costs and reasonable
attorneys' fees, and (d) similar expenses reasonably paid or incurred in
connection with liquidation.

         LIQUIDATION PROCEEDS: Cash received in connection with the liquidation
of a defaulted Mortgage Loan, whether through trustee's sale, foreclosure sale,
Insurance Proceeds, condemnation proceeds or otherwise.

         LOAN GROUP: Loan Group I-1, Loan Group I-2, Loan Group I or Loan Group
II, as applicable.

         LOAN GROUP I: Loan Group I-1 and Loan Group I-2, collectively.

         LOAN GROUP I-1: The group of Mortgage Loans designated as belonging to
Loan Group I-1 on the Mortgage Loan Schedule.

         LOAN GROUP I-2: The group of Mortgage Loans designated as belonging to
Loan Group I-2 on the Mortgage Loan Schedule.

         LOAN GROUP II: The group of Mortgage Loans designated as belonging to
Loan Group II on the Mortgage Loan Schedule.

         LOAN-TO-VALUE RATIO: With respect to any Mortgage Loan (i) for which a
Standard BPO or Statistical BPO was performed, the Current Loan-to-BPO Value
Ratio and (ii) for which a Standard BPO or Statistical BPO was not performed,
the Current Loan-to-Original Value Ratio.

         LOSS ALLOCATION LIMITATION: The Group I Loss Allocation Limitation or
the Group II Loss Allocation Limitation, as applicable.

         LOST NOTES: The original Mortgage Notes that have been lost, as
indicated on the Mortgage Loan Schedule.

         MASTER SERVICER: As of the Closing Date, Wells Fargo Bank Minnesota,
National Association and, thereafter, its respective successors in interest who
meet the qualifications of the Servicing Agreements and this Agreement.



                                      -30-
<PAGE>


         MASTER SERVICER CERTIFICATION: A written certification, addressed to
the Seller or an Affiliate of the Seller that is executing any Form 10-K,
covering the Mortgage Loans serviced by the WF Servicers and sub-master serviced
by Universal, signed by an officer of the Master Servicer, that otherwise
complies with (i) the Sarbanes-Oxley Act of 2002, as amended from time to time,
and (ii) the February 21, 2003 Statement by the Staff of the Division of
Corporation Finance of the Securities and Exchange Commission Regarding
Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and 15d-14, as
in effect from time to time; provided that if, after the Closing Date (a) the
Sarbanes-Oxley Act of 2002 is amended, (b) the Statement referred to in clause
(ii) is modified or superceded by any subsequent statement, rule or regulation
of the Securities and Exchange Commission or any statement of a division
thereof, or (c) any future releases, rules and regulations are published by the
Securities and Exchange Commission from time to time pursuant to the
Sarbanes-Oxley Act of 2002, which in any such case affects the form or substance
of the required certification and results in the required certification being,
in the reasonable judgment of the Master Servicer, materially more onerous than
the form of the required certification as of the Closing Date, the Master
Servicer Certification shall be as agreed to by the Master Servicer and the
Seller following a negotiation in good faith to determine how to comply with any
such new requirements.

         MASTER SERVICER COLLECTION ACCOUNT: The trust account or accounts
created and maintained pursuant to Section 4.02, which shall be denominated
"Deutsche Bank National Trust Company, as Trustee f/b/o holders of Structured
Asset Mortgage Investments Inc., Structured Asset Mortgage Investments Trust,
Mortgage Pass-Through Certificates, Series 2003-CL1 - Master Servicer Collection
Account." The Master Servicer Collection Account shall be an Eligible Account.

         MASTER SERVICING COMPENSATION: For any Distribution Date, the sum of
the Master Servicing Fee and the Additional Master Servicing Compensation for
such Distribution Date.

         MASTER SERVICING FEE: As to each Mortgage Loan and Distribution Date,
an amount equal to the product of (i) the Scheduled Principal Balance of such
Mortgage Loan as of the Due Date in the preceding calendar month and (ii) the
applicable Master Servicing Fee Rate.

         MASTER SERVICING FEE RATE: As to each Mortgage Loan, 0.01% per annum.

         MAXIMUM LIFETIME MORTGAGE RATE: With respect to any Group II Mortgage
Loan, the maximum level to which a Mortgage Interest Rate can adjust in
accordance with its terms, regardless of changes in the applicable Index.

         MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.

         MERS(R) SYSTEM: The system of recording transfers of Mortgages
electronically maintained by MERS.

         MFB: MFB Financial, or its successor in interest.



                                      -31-
<PAGE>


         MFB SERVICING AGREEMENT: The Mortgage Loan Sale and Servicing
Agreement, dated as of May 29, 1998, as between Hanover Capital Mortgage
Holdings, Inc. and MFB, together with the Recognition Agreement, dated as of
June 1, 2003 between EMC and MFB, each attached hereto as Exhibit H-9, as
modified by the related Assignment Agreement.

         MIN: The Mortgage Identification Number for Mortgage Loans registered
with MERS on the MERS(R) System.

         MINIMUM LIFETIME MORTGAGE RATE: With respect to any Group II Mortgage
Loan, the minimum level to which a Mortgage Interest Rate can adjust in
accordance with its terms, regardless of changes in the applicable Index.

         MOM LOAN: With respect to any Mortgage Loan, MERS acting as the
mortgagee of such Mortgage Loan, solely as nominee for the originator of such
Mortgage Loan and its successors and assigns, at the origination thereof, or as
nominee for any subsequent assignee of the originator pursuant to an assignment
of mortgage to MERS.

         MONTHLY ADVANCE: An advance of principal or interest required to be
made by the applicable Servicer pursuant to the related Servicing Agreement, the
applicable Sub-Master Servicer pursuant to the related Sub-Master Servicing
Agreement or the Master Servicer pursuant to Section 6.05.

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

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

         MORTGAGE INTEREST RATE: The annual rate at which interest accrues from
time to time on any Mortgage Loan pursuant to the related Mortgage Note, which
rate is initially equal to the "Mortgage Interest Rate" set forth with respect
thereto on the Mortgage Loan Schedule.

         MORTGAGE LOAN: A mortgage loan transferred and assigned to the Trustee
pursuant to Section 2.01 or Section 2.04 and held as a part of the Trust Fund,
as identified in the Mortgage Loan Schedule (which shall include, without
limitation, (i) with respect to each Cooperative Loan, the related Mortgage
Note, Security Agreement, Assignment of Proprietary Lease, Cooperative Stock
Certificate, Cooperative Lease and Mortgage File and all rights appertaining
thereto, and (ii) with respect to each Mortgage Loan other than a Cooperative
Loan, each related Mortgage Note, Mortgage and Mortgage File and all rights
appertaining thereto), including a mortgage loan the property securing which has
become an REO Property.

         MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement
dated as of June 30, 2003, between EMC, as seller, and Structured Asset Mortgage
Investments Inc., as purchaser, and all amendments thereof and supplements
thereto, attached as Exhibit J.


                                      -32-


<PAGE>


         MORTGAGE LOAN SCHEDULE: The schedule, attached hereto as Exhibit B with
respect to the Mortgage Loans and as amended from time to time to reflect the
repurchase or substitution of Mortgage Loans pursuant to this Agreement.

         MORTGAGE LOAN SELLER: EMC Mortgage Corporation, as mortgage loan seller
under the Mortgage Loan Purchase Agreement.

         MORTGAGE NOTE: The originally executed note or other evidence of the
indebtedness of a Mortgagor under the related Mortgage Loan.

         MORTGAGED PROPERTY: Land and improvements securing the indebtedness of
a Mortgagor under the related Mortgage Loan or, in the case of REO Property,
such REO Property, or, in the case of a Cooperative Loan, the related
Cooperative Lease and Cooperative Stock.

         MORTGAGOR: The obligor on a Mortgage Note.

         NEGATIVE AMORTIZATION MORTGAGE LOAN: Any Mortgage Loan which provides
for Deferred Interest.

         NET INTEREST SHORTFALL: With respect to any Distribution Date, the
Interest Shortfall, if any, for such Distribution Date net of Compensating
Interest Payments made with respect to such Distribution Date.

         NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of (i) Liquidation Expenses which are payable therefrom
to the related Servicer, the related Sub- Master Servicer or the Master Servicer
in accordance with the related Servicing Agreement, the related Sub-Master
Servicing Agreement or this Agreement and (ii) unreimbursed advances by the
related Servicer, the related Sub-Master Servicer or the Master Servicer and
Monthly Advances.

         NET RATE: With respect to each Mortgage Loan, the Mortgage Interest
Rate in effect from time to time less the Aggregate Expense Rate (expressed as a
per annum rate).

         NON-DISCOUNT MORTGAGE LOAN: A Group I-1 Non-Discount Mortgage Loan or
Group I-2 Non- Discount Mortgage Loan.

         NON-PO PERCENTAGE: Shall mean, with respect to each (i) Group I-1
Discount Mortgage Loan, the Net Rate thereof divided by 8.00%, (ii) Group I-2
Discount Mortgage Loan, the Net Rate thereof divided by 7.50% and (iii)
Non-Discount Mortgage Loan, 100%.

         NONRECOVERABLE ADVANCE: Any advance or Monthly Advance (i) which was
previously made or is proposed to be made by the Master Servicer, the Trustee
(as successor Master Servicer), the applicable Sub-Master Servicer or the
applicable Servicer and (ii) which, in the good faith judgment of the Master
Servicer, the Trustee, the applicable Sub-Master Servicer or the applicable
Servicer, will not or, in the case of a proposed advance or Monthly Advance,
would not, be ultimately recoverable by the Master Servicer, the Trustee (as
successor Master Servicer), the applicable Sub- Master Servicer or the
applicable Servicer from Liquidation Proceeds, Insurance Proceeds or future


                                      -33-
<PAGE>


payments on the Mortgage Loan for which such advance or Monthly Advance was made
or is proposed to be made.

         NOTIONAL AMOUNT: The Notional Amount of the Class I-S1 Certificates, as
of any date of determination, is equal to the Current Principal Amount of the
Class I-A-1 Certificates. For federal income tax purposes, however, the notional
amount of the Class I-S1 Certificates is the Uncertificated Principal Balance of
REMIC III Regular Interest I-F1. The Notional Amount of the Class I-S2
Certificates, as of any date of determination, is equal to the Current Principal
Amount of the Class I-F2 Certificates. For federal income tax purposes, however,
the notional amount of the Class I-S2 Certificates is the Uncertificated
Principal Balance of REMIC III Regular Interest I-F2. The Notional Amount of the
Class I-I1 Certificates, as of any date of determination, is equal to the
Scheduled Principal Balance of the Group I Mortgage Loans. For federal income
tax purposes, however, the Class I-I1 Certificates will not have a Notional
Amount, but will be entitled to 100% of amounts distributed on REMIC III Regular
Interest I-I1. The Notional Amount of the Class I-I2 Certificates, as of any
date of determination, is equal to the aggregate Current Principal Amount of the
Class I-B1, Class I-B2 and Class I-B3 Certificates. For federal income tax
purposes, however, the Notional Amount of the Class I-I2 Certificates will equal
the aggregate Uncertificated Principal Balance or REMIC III Regular Interests
I-B2, I-B2 and I-B2.

         OFFERED CERTIFICATE: Any Senior Certificate or Offered Subordinate
Certificate.

         OFFERED SUBORDINATE CERTIFICATES: The Group I Offered Subordinate
Certificates and the Group II Offered Subordinate Certificates.

         OFFICER'S CERTIFICATE: A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a Vice President or
Assistant Vice President or other authorized officer of the Master Servicer or
the Seller, as applicable, and delivered to the Trustee, as required by this
Agreement.

         OPINION OF COUNSEL: A written opinion of counsel who is or are
acceptable, and in form and substance satisactory, to the Trustee and who,
unless required to be Independent (an "Opinion of Independent Counsel"), may be
internal counsel for EMC, the Master Servicer or the Seller.

         ORIGINAL GROUP SUBORDINATE PRINCIPAL BALANCE: The Original Group I
Subordinate Principal Balance or Original Group II Subordinate Principal
Balance.

         ORIGINAL GROUP I SUBORDINATE PRINCIPAL BALANCE: The sum of the
aggregate Current Principal Amounts of each Class of Group I Subordinate
Certificates as of the Closing Date.

         ORIGINAL GROUP II SUBORDINATE PRINCIPAL BALANCE: The sum of the
aggregate Current Principal Amounts of each Class of Group II Subordinate
Certificates as of the Closing Date.

         ORIGINAL VALUE: The lesser of (i) the Appraised Value or (ii) the sales
price of a Mortgaged Property at the time of origination of a Mortgage Loan,
except in instances where either clauses (i) or (ii) is unavailable, the other
may be used to determine the Original Value, or if both clauses (i)



                                      -34-
<PAGE>


and (ii) are unavailable, Original Value may be determined from other sources
reasonably acceptable to the Seller.

         OUTSTANDING MORTGAGE LOAN: With respect to any Due Date, a Mortgage
Loan which, prior to such Due Date, was not the subject of a Principal
Prepayment in full, did not become a Liquidated Mortgage Loan and was not
purchased or replaced.

         OUTSTANDING PRINCIPAL BALANCE: As of the time of any determination, the
principal balance of a Mortgage Loan remaining to be paid by the Mortgagor, or,
in the case of an REO Property, the principal balance of the related Mortgage
Loan remaining to be paid by the Mortgagor at the time such property was
acquired by the Trust Fund less any Net Liquidation Proceeds with respect
thereto to the extent applied to principal.

         PASS-THROUGH RATE: As to each Class of Certificates and the REMIC I
Regular Interests, REMIC II Regular Interests and REMIC III Regular Interests,
the rate of interest determined as provided with respect thereto, in Section
5.01(c). Any monthly calculation of interest at a stated rate shall be based
upon annual interest at such rate divided by twelve.

         PERIODIC RATE CAP: With respect to each Group II Mortgage Loan, the
maximum adjustment that can be made to the Mortgage Interest Rate on each
Interest Adjustment Date in accordance with its terms, regardless of changes in
the applicable Index.

         PERMITTED INVESTMENTS: Any one or more of the following obligations or
securities held in the name of the Trustee for the benefit of the
Certificateholders:

                  (i) direct obligations of, and obligations the timely payment
         of which are fully guaranteed by the United States of America or any
         agency or instrumentality of the United States of America the
         obligations of which are backed by the full faith and credit of the
         United States of America;

                  (ii) (a) demand or time deposits, federal funds or bankers'
         acceptances issued by any depository institution or trust company
         incorporated under the laws of the United States of America or any
         state thereof (including the Trustee or the Master Servicer or its
         Affiliates acting in its commercial banking capacity) and subject to
         supervision and examination by federal and/or state banking
         authorities, provided that the commercial paper and/or the short- term
         debt rating and/or the long-term unsecured debt obligations of such
         depository institution or trust company at the time of such investment
         or contractual commitment providing for such investment have the
         Applicable Credit Rating or better from each Rating Agency and (b) any
         other demand or time deposit or certificate of deposit that is fully
         insured by the Federal Deposit Insurance Corporation;

                  (iii) repurchase obligations with respect to (a) any security
         described in clause (i) above or (b) any other security issued or
         guaranteed by an agency or instrumentality of the United States of
         America, the obligations of which are backed by the full faith and
         credit of the United States of America, in either case entered into
         with a depository institution or



                                      -35-
<PAGE>


         trust company (acting as principal) described in clause (ii)(a) above
         where the Trustee holds the security therefor;

                  (iv) securities bearing interest or sold at a discount issued
         by any corporation (including the Trustee or the Master Servicer or its
         Affiliates) incorporated under the laws of the United States of America
         or any state thereof that have the Applicable Credit Rating or better
         from each Rating Agency at the time of such investment or contractual
         commitment providing for such investment; provided, however, that
         securities issued by any particular corporation will not be Permitted
         Investments to the extent that investments therein will cause the then
         outstanding principal amount of securities issued by such corporation
         and held as part of the Trust to exceed 10% of the aggregate
         Outstanding Principal Balances of all the Mortgage Loans and Permitted
         Investments held as part of the Trust;

                  (v) commercial paper (including both non-interest-bearing
         discount obligations and interest-bearing obligations payable on demand
         or on a specified date not more than one year after the date of
         issuance thereof) having the Applicable Credit Rating or better from
         each Rating Agency at the time of such investment;

                  (vi) a Reinvestment Agreement issued by any bank, insurance
         company or other corporation or entity;

                  (vii) any other demand, money market or time deposit,
         obligation, security or investment as may be acceptable to each Rating
         Agency as evidenced in writing by each Rating Agency to the Trustee;
         and

                  (viii) any money market or common trust fund having the
         Applicable Credit Rating or better from each Rating Agency, including
         any such fund for which the Trustee or Master Servicer or any affiliate
         of the Trustee or Master Servicer acts as a manager or an advisor;
         provided, however, that no instrument or security shall be a Permitted
         Investment if such instrument or security evidences a right to receive
         only interest payments with respect to the obligations underlying such
         instrument or if such security provides for payment of both principal
         and interest with a yield to maturity in excess of 120% of the yield to
         maturity at par or if such instrument or security is purchased at a
         price greater than par.

         PERMITTED TRANSFEREE: Any Person other than a Disqualified Organization
or an "electing large partnership" (as defined by Section 775 of the Code).

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

         PHYSICAL CERTIFICATES: The Residual Certificates and the Private
Certificates.



                                      -36-
<PAGE>


         PO PERCENTAGE: Shall mean, with respect to each (i) Group I-1 Discount
Mortgage Loan, the fraction, expressed as a percentage, equal to 8.00% minus the
Net Rate thereof divided by 8.00% and (ii) Group I-2 Discount Mortgage Loan, the
fraction, expressed as a percentage, equal to 7.50% minus the Net Rate thereof
divided by 7.50%. The PO Percentage of any Non-Discount Mortgage Loan shall be
zero.

         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.

         PREPAYMENT PERIOD: With respect to any Mortgage Loan and any
Distribution Date, the calendar month preceding the month in which such
Distribution Date occurs.

         PRIMARY MORTGAGE INSURANCE POLICY: Any primary mortgage guaranty
insurance policy issued in connection with a Mortgage Loan which provides
compensation to a Mortgage Note holder in the event of default by the obligor
under such Mortgage Note or the related security instrument, if any or any
replacement policy therefor through the related Interest Accrual Period for such
Class relating to a Distribution Date.

         PRIME WEST: Prime West Mortgage Corporation, or its successor in
interest.

         PRINCIPAL PREPAYMENT: Any payment (whether partial or full) or other
recovery of principal on a Mortgage Loan which is received in advance of its
scheduled Due Date to the extent that it is not accompanied by an amount as to
interest representing scheduled interest due on any date or dates in any month
or months subsequent to the month of prepayment, including Insurance Proceeds
and Repurchase Proceeds, but excluding the principal portion of Net Liquidation
Proceeds.

         PRIVATE CERTIFICATES: Any Class I-B4, Class I-B5, Class I-B6, Class
II-B4, Class II-B5 or Class II-B6 Certificate.

         PROTECTED ACCOUNT: An account established and maintained for the
benefit of Certificateholders by each Servicer and each Sub-Master Servicer with
respect to the related Mortgage Loans and with respect to REO Property pursuant
to the respective Servicing Agreements and Sub-Master Servicing Agreements.

         QIB: A Qualified Institutional Buyer as defined in Rule 144A
promulgated under the Securities Act.

         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 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.

         RATING AGENCIES: Moody's and S&P.



                                      -37-
<PAGE>


         REALIZED LOSS: Any (i) Bankruptcy Loss or (ii) as to any Liquidated
Mortgage Loan, (x) the Outstanding Principal Balance of such Liquidated Mortgage
Loan plus accrued and unpaid interest thereon at the Mortgage Interest Rate
through the last day of the month of such liquidation, less (y) the related Net
Liquidation Proceeds with respect to such Mortgage Loan and the related Mortgage
Property.

         RECORD DATE: With respect to any Distribution Date and each Class of
Certificates (other than the Class I-F1, Class I-S1, Class I-F2 and Class I-S2
Certificates), the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date. With respect to each
Distribution Date and the Class I-F1, Class I-S1, Class I-F2 and Class I-S2
Certificates, so long as the Class I-F1, Class I-S1, Class I-F2 and Class I-S2
Certificates are Book-Entry Certificates, the Business Day immediately preceding
such Distribution Date and otherwise, the close of business on the last Business
Day of the month immediately preceding the month of such Distribution Date.

         REINVESTMENT AGREEMENTS: One or more reinvestment agreements,
acceptable to the Rating Agencies, from a bank, insurance company or other
corporation or entity (including the Trustee).

         RELIEF ACT: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended, or similar state law.

         RELIEF ACT MORTGAGE LOAN: Any Mortgage Loan as to which the Scheduled
Payment thereof has been reduced due to the application of the Relief Act.

         REMIC: A real estate mortgage investment conduit, as defined in the
Code.

         REMIC I: That group of assets contained in the Trust Fund designated as
a REMIC consisting of (i) the Group I Mortgage Loans, (ii) the portion of the
Master Servicer Collection Account relating to the Group I Mortgage Loans, (iii)
any REO Property relating to the Group I Mortgage Loans, (iv) the rights with
respect to any related Servicing Agreement or Sub-Master Servicing Agreement,
(v) the rights with respect to any related Assignment Agreement and (vi) any
proceeds of the foregoing.

         REMIC I INTERESTS: The REMIC I Regular Interests and the Class R-I
Certificates.

         REMIC I REGULAR INTERESTS: The REMIC I Regular Interests, with such
terms as described in Section 5.01(c).

         REMIC I SUBORDINATED BALANCE RATIO: The ratio among the Uncertificated
Principal Balances of each of the REMIC I Regular Interests ending with the
designation "sub," equal to the ratio among, with respect to each such REMIC I
Regular Interest, the excess of (x) the aggregate Scheduled Principal Balance of
the Mortgage Loans in the related Loan Group over (y) the Current Principal
Amount of the Senior Certificates in the related Group.

         REMIC II: That group of assets contained in the Trust Fund designated
as a REMIC consisting of (i) the Group II Mortgage Loans, (ii) the portion of
the Master Servicer Collection



                                      -38-
<PAGE>


Account relating to the Group II Mortgage Loans, (iii) any REO Property relating
to the Group II Mortgage Loans, (iv) the rights with respect to any related
Servicing Agreement or Sub-Master Servicing Agreement, (v) the rights with
respect to any related Assignment Agreement and (vi) any proceeds of the
foregoing.

         REMIC II INTERESTS: The REMIC II Regular Interests and the Class R-II
Certificates.

         REMIC II REGULAR INTERESTS: As defined in Section 5.01(c).

         REMIC III: That group of assets contained in the Trust Fund designated
as a REMIC consisting of the REMIC I and REMIC II Regular Interests.

         REMIC III INTERESTS: The REMIC III Regular Interests and the Class
R-III Certificates.

         REMIC III REGULAR INTERESTS: As defined in Section 5.01(c).

         REMIC IV: That group of assets contained in the Trust Fund designated
as a REMIC consisting of the REMIC III Regular Interests.

         REMIC IV INTERESTS: The REMIC IV Regular Certificates and the Class
R-IV Certificates.

         REMIC IV REGULAR CERTIFICATES: As defined in Section 5.01(c).

         REMIC OPINION: An Opinion of Independent Counsel, to the effect that
the proposed action described therein would not, under the REMIC Provisions, (i)
cause any REMIC to fail to qualify as a REMIC while any regular interest in such
REMIC is outstanding, (ii) result in a tax on prohibited transactions with
respect to any REMIC or (iii) constitute a taxable contribution to any REMIC
after the Startup Day.

         REMIC PROVISIONS: The provisions of the federal income tax law relating
to the REMIC, which appear at Sections 860A through 860G of the Code, and
related provisions and regulations promulgated thereunder, as the foregoing may
be in effect from time to time.

         REO PROPERTY: A Mortgaged Property acquired in the name of the Trustee,
for the benefit of Certificateholders, by foreclosure or deed-in-lieu of
foreclosure in connection with a defaulted Mortgage Loan.

         REPURCHASE PRICE: With respect to any Mortgage Loan (or any property
acquired with respect thereto) required to be repurchased by the Mortgage Loan
Seller pursuant to the Mortgage Loan Purchase Agreement or Article II of this
Agreement, an amount equal to the sum of (i)(a) 100% of the Outstanding
Principal Balance of such Mortgage Loan as of the date of repurchase (or if the
related Mortgaged Property was acquired with respect thereto, 100% of the
Outstanding Principal Balance at the date of the acquisition), plus (b) accrued
but unpaid interest on the Outstanding Principal Balance at the related Mortgage
Interest Rate, through and including the last day of the month of repurchase,
plus (c) any unreimbursed Monthly Advances and servicing advances payable to the
Servicer of the Mortgage Loan, to the applicable Sub-Master Servicer or to the
Master



                                      -39-
<PAGE>


Servicer and (ii) any costs and damages (if any) incurred by the Trust in
connection with any violation of such Mortgage Loan of any predatory or abusive
lending laws.

         REPURCHASE PROCEEDS: the Repurchase Price in connection with any
repurchase of a Mortgage Loan by the Mortgage Loan Seller and any cash deposit
in connection with the substitution of a Mortgage Loan.

         REQUEST FOR RELEASE: A request for release in the form attached hereto
as Exhibit D.

         REQUIRED INSURANCE POLICY: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement with respect to such Mortgage Loan.

         RESIDUAL CERTIFICATES: Any of the Class R Certificates.

         RESPONSIBLE OFFICER: Any officer assigned to the Corporate Trust Office
(or any successor thereto), including any vice president, assistant vice
president, associate, any assistant secretary or any other officer of the
Trustee customarily performing functions similar to those performed by any of
the above designated officers and having direct responsibility for the
administration of this Agreement, and any other officer of the Trustee to whom a
matter arising hereunder may be referred because of such officer's knowledge of
and familiarity with the particular subject.

         RULE 144A CERTIFICATE: The certificate to be furnished by each
purchaser of a Private Certificate (which is also a Physical Certificate) which
is a Qualified Institutional Buyer as defined under Rule 144A promulgated under
the Securities Act, substantially in the form set forth as Exhibit F-2 hereto.

         S&P: Standard & Poor's, a division of The McGraw-Hill Companies, Inc.,
and its successors in interest.

         SCHEDULED PAYMENT: With respect to any Mortgage Loan and any month, the
scheduled payment or payments of principal and interest due during such month on
such Mortgage Loan which either is payable by a Mortgagor in such month under
the related Mortgage Note or, in the case of REO Property, would otherwise have
been payable under the related Mortgage Note.

         SCHEDULED PRINCIPAL: The principal portion of any Scheduled Payment.

         SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan on any
Distribution Date, (i) the sum of (a) the unpaid principal balance of such
Mortgage Loan as of the close of business on the related Due Date (i.e., taking
account of the principal payment to be made on such Due Date and irrespective of
any delinquency in its payment), as specified in the amortization schedule at
the time relating thereto (before any adjustment to such amortization schedule
by reason of any bankruptcy or similar proceeding occurring after the Cut-off
Date (other than a Deficient Valuation) or any moratorium or similar waiver or
grace period) and (b) with respect to any Negative Amortization Mortgage Loan,
any Deferred Interest added to the principal balance of such Mortgage Loan
during the related Due Period or any previous Due Periods, and less (ii) any
Principal



                                      -40-
<PAGE>


Prepayments (including the principal portion of Net Liquidation
Proceeds) received during or prior to the related Prepayment Period; provided
that the Scheduled Principal Balance of a Liquidated Mortgage Loan is zero.

         SECURITIES ACT: The Securities Act of 1933, as amended.

         SECURITIES ADMINISTRATOR: Wells Fargo Bank Minnesota, National
Association, or its successor in interest, or any successor securities
administrator appointed as herein provided.

         SECURITIES LEGEND: "THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3)
IN CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE
MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT
OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS
PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN
THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY
OTHER APPLICABLE JURISDICTION. THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR
INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED [in the case of a Residual Certificate or a Private
Certificate] UNLESS THE OPINION OF COUNSEL REQUIRED BY SECTION 5.07 OF THE
POOLING AND SERVICING AGREEMENT IS PROVIDED [in the case of the Class I-B6
Certificates and Class II-B6 Certificates]:, UNLESS THE PROPOSED TRANSFER AND
HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND OPERATION OF THE
TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY NON-EXEMPT PROHIBITED
TRANSACTION AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON
THE PART OF THE SELLER, THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER, ANY
SUB-MASTER SERVICER, ANY



                                      -41-
<PAGE>


SERVICER OR THE TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A
BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE AND WILL BE EVIDENCED BY A
REPRESENTATION OR AN OPINION OF COUNSEL TO SUCH EFFECT BY OR ON BEHALF OF AN
INSTITUTIONAL ACCREDITED INVESTOR [in the case of the Class I-B1, Class I-B2,
Class I-B3, Class I-B4, Class I-B5, Class II- B1, Class II-B2, Class II-B3,
Class II-B4 and Class II-B5 Certificates] UNLESS EITHER (I) IT IS NOT A PLAN OR
INVESTING WITH "PLAN ASSETS", (II) (1) IT IS AN INSURANCE COMPANY, (2)THE SOURCE
OF FUNDS USED TO ACQUIRE OR HOLD THE CERTIFICATE OR INTEREST THEREIN IS AN
"INSURANCE COMPANY GENERAL ACCOUNT," AS SUCH TERM IS DEFINED IN PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60, AND (3) THE CONDITIONS IN SECTIONS I
AND III OF PTCE 95-60 HAVE BEEN SATISFIED."

         SECURITY AGREEMENT: With respect to a Cooperative Loan, the agreement
creating a security interest in favor of the originator in the related
Cooperative Stock.

         SECURITY INSTRUMENT: A written instrument creating a valid first lien
on a Mortgaged Property securing a Mortgage Note, which may be any applicable
form of mortgage, deed of trust, deed to secure debt or security deed, including
any riders or addenda thereto.

         SELLER: Structured Asset Mortgage Investments Inc., a Delaware
corporation, or its successors in interest.

         SENIOR CERTIFICATES: The Group I-1 Senior Certificates, Group I-2
Senior Certificates, Group I Senior Certificates or Group II Senior
Certificates.

         SENIOR OPTIMAL PRINCIPAL AMOUNT: The Group I-1 Senior Optimal Principal
Amount, Group I-2 Senior Optimal Principal Amount or Group II Senior Optimal
Principal Amount.

         SENIOR PERCENTAGE: The Group I-1 Senior Percentage, Group I-2 Senior
Percentage or Group II Senior Percentage.

         SENIOR PREPAYMENT PERCENTAGE: The Group I-1 Senior Prepayment
Percentage, Group I-2 Senior Prepayment Percentage or Group II Senior Prepayment
Percentage.

         SERVICER: With respect to each Mortgage Loan, ABN AMRO, Alliance, BofA,
Cendant, Chase, CitiMortgage, Countrywide, EMC, GE Capital, GMAC, GreenPoint,
HomeComing, Liberty, MFB, Prime West, Sky Bank, Union Planters, WMBFA, WFHM and
Wendover.

         SERVICER REMITTANCE DATE: With respect to each Mortgage Loan, the date
set forth in the related Servicing Agreement or, in the case of a Mortgage Loan
which is being sub-master serviced, the related Sub-Master Servicing Agreement.

         SERVICING AGREEMENTS: The ABN AMRO Servicing Agreement, Alliance
Servicing Agreement, BofA Servicing Agreement, EMC Servicing Agreement, GE
Capital Servicing Agreement, GreenPoint Servicing Agreement, Impac Servicing
Agreements, Liberty Servicing Agreement, MFB Servicing Agreement, Sky Bank
Servicing Agreement, Union Planters Servicing



                                      -42-
<PAGE>


Agreement, Universal Servicing Agreements, WMBFA Servicing Agreement and WFHM
Servicing Agreement.

         SERVICING FEE: As to any Mortgage Loan and Distribution Date, an amount
equal to the product of (i) the Scheduled Principal Balance of such Mortgage
Loan as of the Due Date in the preceding calendar month and (ii) the applicable
Servicing Fee Rate.

         SERVICING FEE RATE: As to any Mortgage Loan, a per annum rate as set
forth in the Mortgage Loan Schedule.

         SERVICING OFFICER: Any officer of a Servicer or a Sub-Master Servicer
involved in, or responsible for, the administration and servicing of the
Mortgage Loans.

         SKY BANK: Sky Bank (as successor to Metropolitan Savings Bank), or its
successor in interest.

         SKY BANK SERVICING AGREEMENT: The Mortgage Loan Sale and Servicing
Agreement, dated as of July 1, 1998, between Hanover Mortgage Capital Holdings,
Inc. and Sky Bank, together with the Recognition Agreement, dated as of June 1,
2003 between EMC and Sky Bank, each attached hereto as Exhibit H-10, as modified
by the related Assignment Agreement.

         SPECIAL HAZARD LOSS: A Realized Loss attributable to damage or a direct
physical loss suffered by a Mortgaged Property (including any Realized Loss due
to the presence or suspected presence of hazardous wastes or substances on a
Mortgaged Property) other than any such damage or loss covered by a hazard
policy or a flood insurance policy required to be maintained in respect of such
Mortgaged Property under this Agreement or any loss due to normal wear and tear
or certain other causes, as reported by the applicable WF Servicer or the
applicable Sub-Master Servicer to the Master Servicer.

         STANDARD BPO: With respect to any Mortgage Loan, a drive-by valuation
(the interior of the property is not inspected) of the related Mortgaged
Property performed by a real estate broker in the community in which the
property is located who is independent of the Seller and EMC.

         STARTUP DAY: June 30, 2003.

         STATISTICAL BPO: With respect to any Mortgage Loan, a market valuation
of the related Mortgaged Property which takes into account regional market data
such as historical trends, recent sales prices, property types and market
conditions in determining the valuation, without any actual inspection of the
Mortgaged Property.

         SUB-MASTER SERVICERS: Impac, Universal and any successors thereto.

         SUB-MASTER SERVICING AGREEMENTS: The Impac Sub-Master Servicing
Agreement and the Universal Sub-Master Servicing Agreement.



                                      -43-
<PAGE>


         SUB-MASTER SERVICING FEE: As to any Mortgage Loan and Distribution
Date, an amount equal to the product of (i) the Scheduled Principal Balance of
such Mortgage Loan as of the Due Date in the preceding calendar month and (ii)
the applicable Sub-Master Servicing Fee Rate.

         SUB-MASTER SERVICING FEE RATE: As to any Mortgage Loan, a per annum
rate as set forth in the Mortgage Loan Schedule.

         SUBORDINATE CERTIFICATES: The Group I Subordinate Certificates and
Group II Subordinate Certificates.

         SUBORDINATE CERTIFICATE WRITEDOWN AMOUNT: As to any Distribution Date,
the amount by which (a) the sum of the Current Principal Amounts of all the
Group I Certificates or Group II Certificates, as applicable, (after giving
effect to the distribution of principal and the allocation of applicable
Realized Losses in reduction of the Current Principal Amounts of such
Certificates on such Distribution Date) exceeds (b) the aggregate Scheduled
Principal Balances of the Mortgage Loans in the related Loan Group on the Due
Date related to such Distribution Date.

         SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: The Group I Subordinate Optimal
Principal Amount or the Group II Subordinate Optimal Principal Distribution
Amount.

         SUBORDINATE PERCENTAGE: The Group I-1 Subordinate Percentage, Group I-2
Subordinate Percentage or Group II Subordinate Percentage, with respect to the
Group I-1 Mortgage Loans, Group I-2 Mortgage Loans and Group II Mortgage Loans,
respectively.

         SUBORDINATE PREPAYMENT PERCENTAGE: The Group I-1 Subordinate Prepayment
Percentage, Group I-2 Subordinate Prepayment Percentage or Group II Subordinate
Prepayment Percentage with respect to the Group I-1 Mortgage Loans, Group I-2
Mortgage Loans and Group II Mortgage Loans, respectively.

         SUBSTITUTE MORTGAGE LOAN: A mortgage loan tendered to the Trustee
pursuant to the related Servicing Agreement, the Mortgage Loan Purchase
Agreement or Section 2.04 of this Agreement, as applicable, in each case, (i)
which has an Outstanding Principal Balance not greater nor materially less than
the Mortgage Loan for which it is to be substituted; (ii) which has a Mortgage
Interest Rate and Net Rate not less than, and not materially greater than, such
Mortgage Loan; (iii) which has a maturity date not materially earlier or later
than such Mortgage Loan and not later than the latest maturity date of any
Mortgage Loan; (iv) which is of the same property type and occupancy type as
such Mortgage Loan; (v) which has a Loan-to-Value Ratio not greater than the
Loan-to-Value Ratio of such Mortgage Loan; (vi) which is current in payment of
principal and interest as of the date of substitution; (vii) as to which the
payment terms do not vary in any material respect from the payment terms of the
Mortgage Loan for which it is to be substituted and (viii) which, in the case of
a Group II Mortgage Loan has a Gross Margin, Periodic Rate Cap and Maximum
Lifetime Mortgage Rate no less than those of such Mortgage Loan, has the same
Index and interval between Interest Adjustment Dates as such Mortgage Loan, and
a Minimum Lifetime Mortgage Rate no lower than that of such Mortgage Loan.



                                      -44-
<PAGE>


         TAX ADMINISTRATION AND TAX MATTERS PERSON: The Securities Administrator
or any successor thereto or assignee thereof shall serve as tax administrator
hereunder and as agent for the Tax Matters Person. The Holder of each Class of
Residual Certificates shall be the Tax Matters Person for the related REMIC, as
more particularly set forth in Section 9.12 hereof.

         TERMINATION PURCHASE PRICE: The price, calculated as set forth in
Section 10.01, to be paid in connection with the repurchase of the Mortgage
Loans pursuant to Section 10.01.

         TRUST FUND OR TRUST: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans and the other assets described in Section
2.01(a).

         TRUSTEE: Deutsche Bank National Trust Company, or its successor in
interest, or any successor trustee appointed as herein provided.

         UNCERTIFICATED PRINCIPAL BALANCE: With respect to any REMIC I Regular
Interest, REMIC II Regular Interest or REMIC III Regular Interest as of any
Distribution Date, the initial principal amount of such Regular Interest,
reduced by (i) all amounts distributed on previous Distribution Dates on such
Regular Interest with respect to principal, (ii) the principal portion of all
Realized Losses allocated prior to such Distribution Date to such Regular
Interest, taking account of the Loss Allocation Limitation, (iii) in the case of
a REMIC III Regular Interest for which the Corresponding Class is a Subordinate
Certificate, such Regular Interest's pro rata share, if any, of the applicable
Subordinate Certificate Writedown Amount allocated to such Corresponding Class
for previous Distribution Dates and (iv) in the case of a REMIC III Regular
Interest for which the Corresponding Class is a Group I Subordinate Certificate,
such Regular Interest's pro rata share, if any, of the applicable Class I-PO
Certificate Deferred Payment Writedown Amount allocated to such Corresponding
Class for previous Distribution Dates.

         UNINSURED CAUSE: Any cause of damage to a Mortgaged Property or related
REO Property such that the complete restoration of such Mortgaged Property or
related REO Property is not fully reimbursable by the hazard insurance policies
required to be maintained pursuant the related Servicing Agreement, without
regard to whether or not such policy is maintained.

         UNITED STATES PERSON: A citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for 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 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 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),



                                      -45-
<PAGE>


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.

         UNION PLANTERS: Union Planters Bank, N.A.

         UNION PLANTERS SERVICING AGREEMENT: The Letter Agreement dated as of
June 30, 2003 among Union Planters, EMC and Alliance pursuant to which Union
Planters agreed to service its Mortgage Loans pursuant to the Servicing
Agreement, dated as of June 1, 2003, between EMC and the Seller, attached hereto
as Exhibit H-11.

         UNIVERSAL: Universal Master Servicing (as assignees of, and successor
to, Wachovia Mortgage Company), or its successor in interest.

         UNIVERSAL SERVICERS: Cendant, Chase, Citi, Countrywide, GMAC and Prime
West.

         UNIVERSAL SERVICING AGREEMENTS: The servicing agreements pursuant to
which each of the Universal Servicers service their respective Mortgage Loans.

         UNIVERSAL SUB-MASTER SERVICING AGREEMENT: The Servicing Agreement,
dated as of June 1, 2003, as between EMC and Universal, attached hereto as
Exhibit H-12, as modified by the related Assignment Agreement.

         WFHM: Wells Fargo Home Mortgage, Inc., or its successor in interest.

         WFHM SERVICING AGREEMENT: The Master Seller's Warranties and Servicing
Agreement, dated as of April 1, 2003, between EMC and WFHM, together with the
Recognition Agreement, dated as of June 1, 2003 between EMC and WFHM, each
attached hereto as Exhibit H-13, as modified by the related Assignment
Agreement.

         WF SERVICERS: ABN AMRO, Alliance, BofA, EMC, GE Capital, GreenPoint,
Liberty, MFB, Sky Bank, Union Planters, WMBFA and WFHM.

         WMBFA: Washington Mutual Bank, FA, or its successor in interest.

         WMBFA SERVICING AGREEMENT: The Servicing Agreement, dated as of April
1, 2001, as amended on December 1, 2002, between EMC and WMBFA, together with
the Recognition Agreement, dated as of June 1, 2003 between EMC and WMBFA,
attached hereto as Exhibit H-14, as modified by the related Assignment
Agreement.



                                      -46-
<PAGE>


Section 1.02.     CALCULATION OF LIBOR.

         LIBOR applicable to the calculation of the Pass-Through Rate on the
Group I-1 Senior Certificates and Group I-2 Senior Certificates for any Interest
Accrual Period will be determined on each Interest Determination Date. On each
Interest Determination Date, LIBOR shall be established by the Securities
Administrator and, as to any Interest Accrual Period, will equal the rate for
one month United States dollar deposits that appears on the Telerate Screen Page
3750 as of 11:00 a.m., London" time, on such Interest Determination Date.
"Telerate Screen Page 3750" means the display designated as page 3750 on the
Telerate Service (or such other page as may replace page 3750 on that service
for the purpose of displaying London interbank offered rates of major banks). If
such rate does not appear on such page (or such other page as may replace that
page on that service, or if such service is no longer offered, LIBOR shall be so
established by use of such other service for displaying LIBOR or comparable
rates as may be reasonably selected by the Securities Administrator), the rate
will be the Reference Bank Rate. The "Reference Bank Rate" will be determined on
the basis of the rates at which deposits in U.S. Dollars are offered by the
reference banks (which shall be any three major banks that are engaged in
transactions in the London interbank market, selected by the Securities
Administrator) as of 11:00 a.m., London time, on the Interest Determination Date
to prime banks in the London interbank market for a period of one month in
amounts approximately equal to the aggregate Current Principal Amount of the
Adjustable Rate Certificates then outstanding. The Securities Administrator will
request the principal London office of each of the reference banks to provide a
quotation of its rate. If at least two such quotations are provided, the rate
will be the arithmetic mean of the quotations rounded up to the nearest whole
multiple of 0.03125%. If on such date fewer than two quotations are provided as
requested, the rate will be the arithmetic mean of the rates quoted by one or
more major banks in New York City, selected by the Securities Administrator, as
of 11:00 a.m., New York City time, on such date for loans in U.S. Dollars to
leading European banks for a period of one month in amounts approximately equal
to the aggregate Current Principal Amount of the Adjustable Rate Certificates
for such Interest Accrual Period. If no such quotations can be obtained, the
rate will be LIBOR for the prior Interest Accrual Period. The establishment of
LIBOR by the Securities Administrator on any Interest Determination Date and the
Securities Administrator's subsequent calculation of the Pass-Through Rate
applicable to the Group I-1 Senior Certificates and Group I-2 Senior
Certificates for the relevant Interest Accrual Period, in the absence of
manifest error, will be final and binding.



                                      -47-
<PAGE>



                                   ARTICLE II
                          Conveyance of Mortgage Loans;
                        Original Issuance of Certificates

         Section 2.01 CONVEYANCE OF MORTGAGE LOANS TO TRUSTEE. (a) The Seller
concurrently with the execution and delivery of this Agreement, sells, transfers
and assigns to the Trust without recourse all its right, title and interest in
and to (i) the Mortgage Loans identified in the Mortgage Loan Schedule,
including all interest and principal due with respect to the Mortgage Loans
after the Cut-off Date, but excluding any payments of principal and interest due
on or prior to the Cut-off Date; (ii) such assets as shall from time to time be
credited or are required by the terms of this Agreement to be credited to the
Master Servicer Collection Account, (iii) such assets relating to the Mortgage
Loans as from time to time may be held by the Servicers or the Sub-Master
Servicers in Protected Accounts, the Master Servicer in the Master Servicer
Collection Account and the Trustee in the Distribution Account, (iv) any REO
Property, (v) the Required Insurance Policies and any amounts paid or payable by
the insurer under any Insurance Policy (to the extent the mortgagee has a claim
thereto), (vi) the Mortgage Loan Purchase Agreement to the extent provided in
Subsection 2.03(a), (vii) the rights (but not the obligations) with respect to
the Servicing Agreements and Sub- Master Servicing Agreements as assigned to the
Trustee on behalf of the Certificateholders by the Assignment Agreements and
(viii) any proceeds of the foregoing. Although it is the intent of the parties
to this Agreement that the conveyance of the Seller's right, title and interest
in and to the Mortgage Loans and other assets in the Trust Fund pursuant to this
Agreement shall constitute a purchase and sale and not a loan, in the event that
such conveyance is deemed to be a loan, it is the intent of the parties to this
Agreement that the Seller shall be deemed to have granted to the Trustee a first
priority perfected security interest in all of the Seller's right, title and
interest in, to and under the Mortgage Loans and other assets in the Trust Fund,
and that this Agreement shall constitute a security agreement under applicable
law.

         (b) In connection with the above transfer and assignment, the Seller
hereby delivers to the Custodian, as agent for the Trustee, with respect to (I)
each Mortgage Loan (other than a Cooperative Loan):

                  (i) the original Mortgage Note, endorsed without recourse to
the order of the Trustee and showing an unbroken chain of endorsements from the
original payee thereof to the Person endorsing it to the Trustee, or lost note
affidavit together with a copy of the related Mortgage Note,

                  (ii) the original Mortgage and, if the related Mortgage Loan
is a MOM Loan, noting the presence of the MIN and language indicating that such
Mortgage Loan is a MOM Loan, which shall have been recorded (or if the original
is not available, a copy), with evidence of such recording indicated thereon (or
if clause (x) in the proviso below applies, shall be in recordable form),

                  (iii) unless the Mortgage Loan is a MOM Loan, a certified copy
of the assignment (which may be in the form of a blanket assignment if permitted
in the jurisdiction in which the Mortgaged Property is located) to "Deutsche
Bank National Trust Company, as Trustee", with evidence of recording with
respect to each Mortgage Loan in the name of the Trustee thereon (or if clause
(x) in the proviso below applies or for Mortgage Loans with respect to which the
related



                                      -48-
<PAGE>



Mortgaged Property is located in a state other than Maryland or an Opinion of
Counsel has been provided as set forth in this Section 2.01(b), shall be in
recordable form),

                  (iv) all intervening assignments of the Security Instrument,
if applicable and only to the extent available to the Seller with evidence of
recording thereon,

                  (v) the original or a copy of the policy or certificate of
primary mortgage guaranty insurance, to the extent available, if any,

                  (vi) the original policy of title insurance or mortgagee's
certificate of title insurance or commitment or binder for title insurance, and

                  (vii) originals of all modification agreements, if applicable
and available;

and (II) with respect to each Cooperative Loan so assigned:

                  (i) The original Mortgage Note, endorsed without recourse to
the order of the Trustee and showing an unbroken chain of endorsements from the
originator thereof to the Person endorsing it to the Trustee, or lost note
affidavit, together with a copy of the related Mortgage Note;

                  (ii) A counterpart of the Cooperative Lease and the Assignment
of Proprietary Lease to the originator of the Cooperative Loan with intervening
assignments showing an unbroken chain of title from such originator to the
Trustee;

                  (iii) The related Cooperative Stock Certificate, representing
the related Cooperative Stock pledged with respect to such Cooperative Loan,
together with an undated stock power (or other similar instrument) executed in
blank;

                  (iv) The original recognition agreement by the Cooperative of
the interests of the mortgagee with respect to the related Cooperative Loan and
any transfer documents related to the recognition agreement;

                  (v) The Security Agreement;

                  (vi) Copies of the original UCC-1 financing statement, and any
continuation statements, filed by the originator of such Cooperative Loan as
secured party, each with evidence of recording thereof, evidencing the interest
of the originator under the Security Agreement and the Assignment of Proprietary
Lease;

                  (vii) Copies of the filed UCC-3 assignments of the security
interest referenced in clause (vi) above showing an unbroken chain of title from
the originator to the Trustee, each with evidence of recording thereof,
evidencing the interest of the originator under the Security Agreement and the
Assignment of Proprietary Lease;




                                      -49-
<PAGE>



                  (viii) An executed assignment of the interest of the
originator in the Security Agreement and Assignment of Proprietary Lease,
showing an unbroken chain of title from the originator to the Trustee; and

                  (ix) The original of each modification, assumption agreement
or preferred loan agreement, if any, relating to such Cooperative Loan;

PROVIDED, HOWEVER, that in lieu of the foregoing, the Seller may deliver to the
Custodian, as agent for the Trustee, the following documents, under the
circumstances set forth below: (x) in lieu of the original Security Instrument,
assignments in favor of the Trustee or intervening assignments thereof which
have been delivered, are being delivered or will, upon receipt of recording
information relating to the Security Instrument required to be included thereon,
be delivered to recording offices for recording and have not been returned to
the Seller in time to permit their delivery as specified above, the Seller may
deliver a true copy thereof with a certification by the Seller, on the face of
such copy, substantially as follows: "Certified to be a true and correct copy of
the original, which has been transmitted for recording"; (y) in lieu of the
Security Instrument, assignment in favor of the Trustee or intervening
assignments thereof, if the applicable jurisdiction retains the originals of
such documents (as evidenced by a certification from the Seller to such effect)
the Seller may deliver photocopies of such documents containing an original
certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; and (z) the Seller shall not be
required to deliver intervening assignments or Mortgage Note endorsements
between the related underlying seller and EMC Mortgage Corporation, between EMC
Mortgage Corporation and the Seller, and between the Seller and the Trustee; and
provided, further, however, that in the case of Mortgage Loans which have been
prepaid in full after the Cut-off Date and prior to the Closing Date, the
Seller, in lieu of delivering the above documents, may deliver to the Custodian,
as agent for the Trustee, a certification to such effect and shall deposit all
amounts paid in respect of such Mortgage Loans in the Master Servicer Collection
Account on the Closing Date. The Seller shall deliver such original documents
(including any original documents as to which certified copies had previously
been delivered) to the Custodian, as agent of the Trustee, promptly after they
are received. The Seller shall cause, at its expense, the assignment of the
Security Instrument to the Trustee to be recorded not later than 180 days after
the Closing Date, unless (a) such recordation is not required by the Rating
Agencies or an Opinion of Counsel addressed to the Trustee has been provided to
the Trustee (with a copy to the Custodian) which states that recordation of such
Security Instrument is not required to protect the interests of the
Certificateholders in the related Mortgage Loans or (b) MERS is identified on
the Mortgage or on a properly recorded assignment of the Mortgage as the
mortgagee of record solely as nominee for Seller and its successor and assigns;
provided, however, that each assignment shall be submitted for recording by the
Seller in the manner described above, at no expense to the Trust or the Trustee
or the Custodian, as its agent, upon the earliest to occur of: (i) reasonable
direction by the Holders of Certificates evidencing Fractional Undivided
Interests aggregating not less than 25% of the Trust, (ii) the occurrence of an
Event of Default, (iii) the occurrence of a bankruptcy, insolvency or
foreclosure relating to the Seller and (iv) the occurrence of a servicing
transfer as described in Section 8.02 hereof. Notwithstanding the foregoing, if
the Seller fails to pay the cost of recording the assignments, such expense will
be paid by the Trust. If the Trustee pays such expenses it shall be reimbursed
for such expenses by the Trust in accordance with Section 9.05.



                                      -50-
<PAGE>



         Section 2.02 ACCEPTANCE OF MORTGAGE LOANS BY TRUSTEE. (a) The Trustee
acknowledges the sale, transfer and assignment of the Trust Fund to it by the
Seller and (based on the Custodian's Certification) receipt of, subject to
further review and the exceptions which may be noted pursuant to the procedures
described below, and declares that it holds, the documents (or certified copies
thereof) delivered to the Custodian, as its agent, pursuant to Section 2.01, and
declares that it will continue to hold those documents and any amendments,
replacements or supplements thereto and all other assets of the Trust Fund
delivered to it as Trustee in trust for the use and benefit of all present and
future Holders of the Certificates. On the Closing Date, the Custodian, with
respect to the Mortgage Loans, shall acknowledge with respect to each Mortgage
Loan by delivery to the Seller and the Trustee of an Initial Certification
receipt of the Mortgage File, but without review of such Mortgage File, except
to the extent necessary to confirm that such Mortgage File contains the related
Mortgage Note or lost note affidavit. No later than 180 days after the Closing
Date (or, with respect to any Substitute Mortgage Loan, within five Business
Days after the receipt by the Custodian thereof), the Trustee agrees, for the
benefit of the Certificateholders, to cause the Custodian to review on its
behalf (under the Custodial Agreement), each Mortgage File delivered to it and
to execute and deliver, to the Seller and the Trustee an Interim Certification.
In conducting such review, the Custodian will ascertain whether all required
documents have been executed and received, and based on the Mortgage Loan
Schedule, whether those documents relate, determined on the basis of the
Mortgagor name, original principal balance and loan number, to the Mortgage
Loans it has received, as identified in the Mortgage Loan Schedule. In
performing any such review, the Trustee and the Custodian, as its agent, may
conclusively rely on the purported due execution and genuineness of any such
document and on the purported genuineness of any signature thereon. If, subject
to Section 2.02(d), the Custodian, as agent for the Trustee, finds any document
constituting part of the Mortgage File not to have been executed or received, or
to be unrelated to the Mortgage Loans identified in Exhibit B or to appear to be
defective on its face (a "Material Defect"), the Custodian, as agent for the
Trustee, shall note such Material Defect on the exception report attached to the
Interim Certification. In accordance with the Mortgage Loan Purchase Agreement,
the Mortgage Loan Seller shall correct or cure any such defect within ninety
(90) days from the date of notice from the Trustee or the Custodian, as its
agent, of the defect and if the Mortgage Loan Seller fails to correct or cure
the defect within such period, and such defect materially and adversely affects
the interests of the Certificateholders in the related Mortgage Loan, the
Trustee shall enforce the Mortgage Loan Seller's obligation pursuant to the
Mortgage Loan Purchase Agreement, within 90 days from the Trustee's or the
Custodian's notification, to purchase such Mortgage Loan at the Repurchase
Price; 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; provided, however, that if such defect relates solely to the
inability of the Mortgage Loan Seller to deliver the original Security
Instrument or intervening assignments thereof, or a certified copy because the
originals of such documents, or a certified copy have been submitted for
recording and have not been returned by the applicable jurisdiction, the
Mortgage Loan Seller shall not be required to purchase such Mortgage Loan if the
Mortgage Loan Seller delivers such original documents or certified copy promptly
upon receipt, but in no event later than 360 days after the Closing Date.

         (b) No later than 270 days after the Closing Date, the Trustee or the
Custodian, as its agent, will review, for the benefit of the Certificateholders,
the Mortgage Files delivered to it and



                                      -51-
<PAGE>


will execute and deliver or cause to be executed and delivered to the Seller and
the Trustee a Final Certification. In conducting such review, the Custodian, as
agent for the Trustee, will ascertain whether an original of each document
required to be recorded has been returned from the recording office with
evidence of recording thereon or a certified copy has been obtained from the
recording office. If the Custodian, as agent of the Trustee, finds a Material
Defect, the Custodian, as agent for the Trustee, shall note such Material Defect
in its exception report attached to the Final Certification (provided, however,
that with respect to those documents described in subsections (b)(I)(iv), (v)
and (vii) of Section 2.01 and subsection (II)(ix) of Section 2.01, the
Custodian's obligations shall extend only to the documents actually delivered
pursuant to such subsections). In accordance with the Mortgage Loan Purchase
Agreement, the Mortgage Loan Seller shall correct or cure any such defect within
90 days from the date of notice from the Trustee or the Custodian, as its agent,
of the Material Defect and if the Mortgage Loan Seller is unable to cure such
defect within such period, and if such defect materially and adversely affects
the interests of the Certificateholders in the related Mortgage Loan, the
Trustee shall enforce the Mortgage Loan Seller's obligation under the Mortgage
Loan Purchase Agreement to provide a Substitute Mortgage Loan (if within two
years of the Closing Date) or purchase such Mortgage Loan at the Repurchase
Price, 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, repurchase or substitution must occur within 90 days from the date
such breach was discovered, provided, however, that if such defect relates
solely to the inability of the Mortgage Loan Seller to deliver the original
Security Instrument or intervening assignments thereof, or a certified copy,
because the originals of such documents or a certified copy, have been submitted
for recording and have not been returned by the applicable jurisdiction, the
Mortgage Loan Seller shall not be required to purchase such Mortgage Loan, if
the Mortgage Loan Seller delivers such original documents or certified copy
promptly upon receipt, but in no event later than 360 days after the Closing
Date.

         (c) In the event that a Mortgage Loan is purchased by the Mortgage Loan
Seller in accordance with Subsections 2.02(a) or (b) above, the Mortgage Loan
Seller shall remit to the Master Servicer the Repurchase Price for deposit in
the Master Servicer Collection Account and the Mortgage Loan Seller shall
provide to the Securities Administrator and the Trustee written notification
detailing the components of the Repurchase Price. Upon deposit of the Repurchase
Price in the Master Servicer Collection Account, the Seller shall notify the
Trustee and the Custodian, and the Custodian as agent of the Trustee (upon
receipt of a Request for Release in the form of Exhibit D attached hereto with
respect to such Mortgage Loan), shall release to the Mortgage Loan Seller the
related Mortgage File and the Trustee shall execute and deliver all instruments
of transfer or assignment, without recourse, representation or warranty,
furnished to it by the Mortgage Loan Seller, as are necessary to vest in the
Mortgage Loan Seller title to and rights under the Mortgage Loan. Such purchase
shall be deemed to have occurred on the date on which the Repurchase Price in
available funds is deposited in the Master Servicer Collection Account. The
Master Servicer shall amend the Mortgage Loan Schedule, which was previously
delivered to it by Seller in a form agreed to between the Seller and the Master
Servicer, to reflect such repurchase and shall promptly notify the Rating
Agencies of such amendment. The obligation of the Mortgage Loan Seller to
repurchase any Mortgage Loan as to which such a defect in a constituent document
exists shall be the sole remedy respecting such defect available to the
Certificateholders or to the Trustee on their behalf.



                                      -52-
<PAGE>


         (d) Anything in this Section 2.02 to the contrary notwithstanding, a
Material Defect will be deemed not to materially and adversely affect the
interest of the Certificateholders in the related Mortgage Loan unless such
defect materially interferes with the applicable Servicer's, Sub-Master
Servicer's or Master Servicer's ability to foreclose on the related Mortgaged
Property.

         Section 2.03 ASSIGNMENT OF INTEREST IN THE MORTGAGE LOAN PURCHASE
AGREEMENT. (a) The Seller hereby assigns to the Trustee, on behalf of the
Certificateholders, all of its right, title and interest in the Mortgage Loan
Purchase Agreement, including but not limited to the Seller's rights pursuant to
the Servicing Agreements and the Sub-Master Servicing Agreements (noting that
the Mortgage Loan Seller has retained the right in the event of breach of the
representations, warranties and covenants, if any, with respect to the related
Mortgage Loans of the related Servicer under the related Servicing Agreement to
enforce the provisions thereof and to seek all or any available remedies). The
obligations of the Mortgage Loan Seller to substitute or repurchase, as
applicable, a Mortgage Loan shall be the Trustee's and the Certificateholders'
sole remedy for any breach thereof. At the request of the Trustee, the Seller
shall take such actions as may be necessary to enforce the above right, title
and interest on behalf of the Trustee and the Certificateholders or shall
execute such further documents as the Trustee may reasonably require in order to
enable the Trustee to carry out such enforcement.

         (b) If the Seller, the Securities Administrator or the Trustee
discovers a breach of any of the representations and warranties set forth in the
Mortgage Loan Purchase Agreement, which breach materially and adversely affects
the value of the interests of Certificateholders or the Trustee in the related
Mortgage Loan, the party discovering the breach shall give prompt written notice
of the breach to the other parties. The Mortgage Loan Seller, within 90 days of
its discovery or receipt of notice that such breach has occurred (whichever
occurs earlier), shall cure the breach in all material respects or, subject to
the Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable, shall purchase the Mortgage Loan or any property acquired with
respect thereto from the Trustee; provided, however, that if there is a breach
of any representation set forth in the Mortgage Loan Purchase Agreement or
Section 2.04 of this Agreement, as applicable, and the Mortgage Loan or the
related property acquired with respect thereto has been sold, then the Mortgage
Loan Seller shall pay, in lieu of the Repurchase Price, any excess of the
Repurchase Price over the Net Liquidation Proceeds received upon such sale. (If
the Net Liquidation Proceeds exceed the Repurchase Price, any excess shall be
paid to the Mortgage Loan Seller to the extent not required by law to be paid to
the borrower.) Any such purchase by the Mortgage Loan Seller shall be made by
providing an amount equal to the Repurchase Price to the Master Servicer for
deposit in the Master Servicer Collection Account and written notification
detailing the components of such Repurchase Price. The Seller shall notify the
Trustee and submit to the Custodian, as agent for the Trustee, a Request for
Release, and the Trustee and Custodian shall release, to the Mortgage Loan
Seller the related Mortgage File and the Trustee shall execute and deliver all
instruments of transfer or assignment furnished to it by the Mortgage Loan
Seller, without recourse, representation or warranty as are necessary to vest in
the Mortgage Loan Seller title to and rights under the Mortgage Loan or any
property acquired with respect thereto. Such purchase shall be deemed to have
occurred on the date on which the Repurchase Price in available funds is
deposited in the Master Servicer Collection Account. The Master Servicer shall
amend the Mortgage Loan Schedule to reflect such repurchase and shall promptly
notify the Trustee and the Rating Agencies of such amendment. Enforcement of the
obligation of the Mortgage Loan Seller to purchase (or substitute a Substitute




                                      -53-
<PAGE>


Mortgage Loan for) any Mortgage Loan or any property acquired with respect
thereto (or pay the Repurchase Price as set forth in the above proviso) as to
which a breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to the Certificateholders or the Trustee on
their behalf.

         Section 2.04 SUBSTITUTION OF MORTGAGE LOANS. Notwithstanding anything
to the contrary in this Agreement, in lieu of purchasing a Mortgage Loan
pursuant to the Mortgage Loan Purchase Agreement or Sections 2.02 or 2.03 of
this Agreement, the Mortgage Loan Seller may, no later than the date by which
such purchase by the Mortgage Loan Seller would otherwise be required, tender to
the Trustee (and deliver the relevant Mortgage Loan File to the Custodian) a
Substitute Mortgage Loan accompanied by a certificate of an authorized officer
of the Mortgage Loan Seller that such Substitute Mortgage Loan conforms to the
requirements set forth in the definition of "Substitute Mortgage Loan" in this
Agreement; provided, however, that substitution pursuant to the Mortgage Loan
Purchase Agreement or Section 2.04 of this Agreement, as applicable, in lieu of
purchase shall not be permitted after the termination of the two-year period
beginning on the Startup Day; provided, further, 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 cure or substitution must occur within 90 days
from the date the breach was discovered by the Mortgage Loan Seller, the Trustee
or the Master Servicer. The Custodian, as agent for the Trustee, shall examine
the Mortgage File for any Substitute Mortgage Loan in the manner set forth in
Section 2.02(a) and the Trustee or the Custodian, as its agent, shall notify the
Mortgage Loan Seller, in writing, within five Business Days after receipt,
whether or not the documents relating to the Substitute Mortgage Loan satisfy
the requirements of the fourth sentence of Subsection 2.02(a). Within two
Business Days after such notification, the Mortgage Loan Seller shall provide to
the Trustee for deposit in the Distribution Account the amount, if any, by which
the Outstanding Principal Balance as of the next preceding Due Date of the
Mortgage Loan for which substitution is being made, after giving effect to the
Scheduled Principal due on such date, exceeds the Outstanding Principal Balance
as of such date of the Substitute Mortgage Loan, after giving effect to
Scheduled Principal due on such date, which amount shall be treated for the
purposes of this Agreement as if it were the payment by the Mortgage Loan Seller
of the Repurchase Price for the purchase of a Mortgage Loan by the Mortgage Loan
Seller. After such notification to the Mortgage Loan Seller and, if any such
excess exists, upon receipt of such deposit, the Trustee shall accept such
Substitute Mortgage Loan (and the Custodian the related Mortgage Loan File)
which shall thereafter be deemed to be a Mortgage Loan hereunder. In the event
of such a substitution, accrued interest on the Substitute Mortgage Loan for the
month in which the substitution occurs and any Principal Prepayments made
thereon during such month shall be the property of the Trust Fund and accrued
interest for such month on the Mortgage Loan for which the substitution is made
and any Principal Prepayments made thereon during such month shall be the
property of the Mortgage Loan Seller. The Scheduled Principal on a Substitute
Mortgage Loan due on the Due Date in the month of substitution shall be the
property of the Mortgage Loan Seller and the Scheduled Principal on the Mortgage
Loan for which the substitution is made due on such Due Date shall be the
property of the Trust Fund. Upon acceptance of the Substitute Mortgage Loan (and
delivery to the Custodian of a Request for Release for such Mortgage Loan), the
Custodian, as agent of the Trustee shall release to the Mortgage Loan Seller the
related Mortgage File related to any Mortgage Loan released pursuant to the
Mortgage Loan Purchase Agreement and Section 2.04 of this Agreement and the
Trustee shall execute and deliver all instruments of transfer or assignment,
without recourse, representation or warranty in form as



                                      -54-
<PAGE>


provided to it as are necessary to vest in the Mortgage Loan Seller title to and
rights under any Mortgage Loan released pursuant to the Mortgage Loan Purchase
Agreement or Section 2.04 of this Agreement, as applicable. The Mortgage Loan
Seller shall deliver to the Custodian the documents related to the Substitute
Mortgage Loan in accordance with the provisions of Subsections 2.01(b) and
2.02(b) of this Agreement, with the date of acceptance of the Substitute
Mortgage Loan deemed to be the Closing Date for purposes of the time periods set
forth in those Subsections. The representations and warranties set forth in the
Mortgage Loan Purchase Agreement shall be deemed to have been made by the
Mortgage Loan Seller with respect to each Substitute Mortgage Loan as of the
date of acceptance of such Mortgage Loan by the Trustee. The Master Servicer
shall amend the Mortgage Loan Schedule to reflect such substitution and shall
provide a copy of such amended Mortgage Loan Schedule to the Trustee and the
Rating Agencies.

         Section 2.05 ISSUANCE OF CERTIFICATES.

         (a) The Trustee acknowledges the assignment to it of the Mortgage Loans
and the other assets comprising the Trust Fund and, concurrently therewith, has
signed, and countersigned and delivered to the Seller, in exchange therefor,
Certificates in such authorized denominations representing such Fractional
Undivided Interests as the Seller has requested. The Trustee agrees that it will
hold the Mortgage Loans and such other assets as may from time to time be
delivered to it segregated on the books of the Trustee in trust for the benefit
of the Certificateholders.

         (b) The Seller, 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 Seller in and
to the REMIC I Regular Interests, and the other assets of REMIC II for the
benefit of the holders of the REMIC II Regular Interests. The Trustee
acknowledges receipt of the REMIC I Regular Interests (which are uncertificated)
and the other assets of REMIC II and declares that it holds and will hold the
same in trust for the exclusive use and benefit of the holders of the REMIC II
Regular Interests.

         (c) The Seller, 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 Seller in and
to the REMIC II Regular Interests, and the other assets of REMIC III for the
benefit of the holders of the REMIC III Regular Interests. The Trustee
acknowledges receipt of the REMIC II Regular Interests (which are
uncertificated) and the other assets of REMIC III and declares that it holds and
will hold the same in trust for the exclusive use and benefit of the holders of
the REMIC III Regular Interests.

         (d) The Seller, 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 Seller in and
to the REMIC III Regular Interests, and the other assets of REMIC IV for the
benefit of the holders of the REMIC IV Certificates. The Trustee acknowledges
receipt of the REMIC III Regular Interests (which are uncertificated) and the
other assets of REMIC IV and declares that it holds and will hold the same in
trust for the exclusive use and benefit of the holders of the REMIC IV
Certificates.




                                      -55-
<PAGE>



         Section 2.06 REPRESENTATIONS AND WARRANTIES CONCERNING THE SELLER. The
Seller hereby represents and warrants to the Trustee, the Master Servicer and
the Securities Administrator as follows:

                  (i) the Seller (a) is a corporation duly organized, validly
         existing and in good standing under the laws of the State of Delaware
         and (b) is qualified and in good standing as a foreign corporation to
         do business in each jurisdiction where such qualification is necessary,
         except where the failure so to qualify would not reasonably be expected
         to have a material adverse effect on the Seller's business as presently
         conducted or on the Seller's ability to enter into this Agreement and
         to consummate the transactions contemplated hereby;

                  (ii) the Seller has full corporate power to own its property,
         to carry on its business as presently conducted and to enter into and
         perform its obligations under this Agreement;

                  (iii) the execution and delivery by the Seller of this
         Agreement have been duly authorized by all necessary corporate action
         on the part of the Seller; and neither the execution and delivery of
         this Agreement, nor the consummation of the transactions herein
         contemplated, nor compliance with the provisions hereof, will conflict
         with or result in a breach of, or constitute a default under, any of
         the provisions of any law, governmental rule, regulation, judgment,
         decree or order binding on the Seller or its properties or the articles
         of incorporation or by-laws of the Seller, except those conflicts,
         breaches or defaults which would not reasonably be expected to have a
         material adverse effect on the Seller's ability to enter into this
         Agreement and to consummate the transactions contemplated hereby;

                  (iv) the execution, delivery and performance by the Seller of
         this Agreement and the consummation of the transactions contemplated
         hereby do not require the consent or approval of, the giving of notice
         to, the registration with, or the taking of any other action in respect
         of, any state, federal or other governmental authority or agency,
         except those consents, approvals, notices, registrations or other
         actions as have already been obtained, given or made;

                  (v) this Agreement has been duly executed and delivered by the
         Seller and, assuming due authorization, execution and delivery by the
         other parties hereto, constitutes a valid and binding obligation of the
         Seller enforceable against it in accordance with its terms (subject to
         applicable bankruptcy and insolvency laws and other similar laws
         affecting the enforcement of the rights of creditors generally);

                  (vi) there are no actions, suits or proceedings pending or, to
         the knowledge of the Seller, threatened against the Seller, before or
         by any court, administrative agency, arbitrator or governmental body
         (i) with respect to any of the transactions contemplated by this
         Agreement or (ii) with respect to any other matter which in the
         judgment of the Seller will be determined adversely to the Seller and
         will if determined adversely to the Seller materially and adversely
         affect the Seller's ability to enter into this Agreement or perform its
         obligations under this Agreement; and the Seller is not in default with
         respect to any



                                      -56-
<PAGE>


         order of any court, administrative agency, arbitrator or governmental
         body so as to materially and adversely affect the transactions
         contemplated by this Agreement; and

                  (vii) immediately prior to the transfer and assignment to the
         Trustee, each Mortgage Note and each Mortgage were not subject to an
         assignment or pledge, and the Seller had good and marketable title to
         and was the sole owner thereof and had full right to transfer and sell
         such Mortgage Loan to the Trustee free and clear of any encumbrance,
         equity, lien, pledge, charge, claim or security interest.




                                      -57-
<PAGE>



                                   ARTICLE III
              Administration and Master Servicing of Mortgage Loans

         Section 3.01 MASTER SERVICER. The Master Servicer shall supervise,
monitor and oversee the obligation of the WF Servicers and the Sub-Master
Servicers to service and administer their respective Mortgage Loans in
accordance with the terms of the applicable Servicing Agreements and Sub-Master
Servicing Agreements and shall have full power and authority to do any and all
things which it may deem necessary or desirable in connection with such master
servicing and administration. In performing its obligations hereunder, the
Master Servicer shall act in a manner consistent with Accepted Master Servicing
Practices. Furthermore, the Master Servicer shall oversee and consult with each
WF Servicer and Sub-Master Servicer, as necessary from time-to-time to carry out
the Master Servicer's obligations hereunder, shall receive, review and evaluate
all reports, information and other data provided to the Master Servicer by each
WF Servicer and each Sub- Master Servicer, and shall cause each WF Servicer and
Sub-Master Servicer to perform and observe the covenants, obligations and
conditions to be performed or observed by such WF Servicer or such Sub-Master
Servicer under its applicable Servicing Agreement or Sub-Master Servicing
Agreement. The Master Servicer shall independently and separately monitor each
WF Servicer's and Sub-Master Servicer's servicing activities with respect to
each related Mortgage Loan, reconcile the results of such monitoring with such
information provided in the previous sentence on a monthly basis and coordinate
corrective adjustments to the WF Servicers' or Sub-Masters', as the case may be,
and Master Servicer's records, and based on such reconciled and corrected
information, the Master Servicer shall provide such information to the
Securities Administrator as shall be necessary in order for it to prepare the
statements specified in Section 6.04, and prepare any other information and
statements required to be forwarded by the Master Servicer hereunder. The Master
Servicer shall reconcile the results of its Mortgage Loan monitoring with the
actual remittances of the Servicers and the Sub-Servicers to the Protected
Account pursuant to the applicable Servicing Agreements.

         Notwithstanding anything in this Agreement or any Servicing Agreement
or Sub-Master Servicing Agreement to the contrary, the Master Servicer shall
have no duty or obligation to supervise, monitor or oversee, and shall have no
liability to any Certificateholder or any other Person for, the activities of
(i) Impac under its Sub-Master Servicing Agreement with respect to its
administration and servicing and/or master servicing of defaulted or delinquent
Mortgage Loans and REO Properties, (ii) any Servicer other than a WF Servicer or
(iii) any Servicer with respect to the administration and servicing of any
defaulted Cash Flow Loan.

         Upon reasonable notice, the Trustee shall furnish the Servicers, the
Sub-Master Servicers and the Master Servicer with any powers of attorney and
other documents in form as provided to it necessary or appropriate to enable the
Servicers, the Sub-Master Servicers and the Master Servicer to service and
administer the related Mortgage Loans and REO Property.

         The Trustee shall provide access to the records and documentation in
possession of the Trustee regarding the related Mortgage Loans and REO Property
and the servicing thereof to the Certificateholders, the FDIC, and the
supervisory agents and examiners of the FDIC, such access being afforded only
upon reasonable prior written request and during normal business hours at the
office of the Trustee; provided, however, that, unless otherwise required by
law, the Trustee shall



                                      -58-
<PAGE>


not be required to provide access to such records and documentation to
Certificateholders if the provision thereof would violate the legal right to
privacy of any Mortgagor. The Trustee shall allow representatives of the above
entities to photocopy any of the records and documentation and shall provide
equipment for that purpose at a charge that covers the Trustee's actual costs.

         Upon reasonable notice, the Trustee shall execute and deliver to the
related Servicer, the related Sub-Master Servicer and the Master Servicer any
court pleadings, requests for trustee's sale or other documents necessary or
desirable to (i) the foreclosure or trustee's sale with respect to a Mortgaged
Property; (ii) any legal action brought to obtain judgment against any Mortgagor
on the Mortgage Note or Security Instrument; (iii) obtain a deficiency judgment
against the Mortgagor; or (iv) enforce any other rights or remedies provided by
the Mortgage Note or Security Instrument or otherwise available at law or
equity.

         Section 3.02 REMIC-RELATED COVENANTS. For as long as each REMIC shall
exist, the Trustee and the Securities Administrator shall act in accordance
herewith to assure continuing treatment of such REMIC as a REMIC, and the
Trustee and the Securities Administrator shall comply with any directions of the
Seller, the related Servicer, the related Sub-Master Servicer or the Master
Servicer to assure such continuing treatment. In particular, the Trustee shall
not (a) sell or permit the sale of all or any portion of the Mortgage Loans or
of any investment of deposits in an Account unless such sale is as a result of a
repurchase of the Mortgage Loans pursuant to this Agreement or the Trustee has
received a REMIC Opinion addressed to the Trustee prepared at the expense of the
Trust Fund; and (b) other than with respect to a substitution pursuant to the
Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable, accept any contribution to any REMIC after the Startup Day without
receipt of a REMIC Opinion addressed to the Trustee.

         Section 3.03 MONITORING OF SERVICERS. (a) The Master Servicer shall be
responsible for reporting to the Trustee and the Seller the compliance by each
WF Servicer and each Sub-Master Servicer with its duties under the related
Servicing Agreement or Sub-Master Servicing Agreement. In the review of each WF
Servicer's and each Sub-Master Servicer's activities, the Master Servicer may
rely upon an officer's certificate of the WF Servicer or Sub-Master Servicer (or
similar document signed by an officer of the WF Servicer or Sub-Master Servicer)
with regard to such Servicer's compliance with the terms of its Servicing
Agreement or Sub-Master Servicing Agreement. In the event that the Master
Servicer, in its judgment, determines that a WF Servicer or a Sub-Master
Servicer should be terminated in accordance with its Servicing Agreement or Sub-
Master Servicing Agreement, or that a notice should be sent pursuant to such
Servicing Agreement or Sub-Master Servicing Agreement with respect to the
occurrence of an event that, unless cured, would constitute grounds for such
termination, the Master Servicer shall notify the Seller and the Trustee thereof
and the Master Servicer shall issue such notice or take such other action as it
deems appropriate.

         (b) The Master Servicer, for the benefit of the Trustee and the
Certificateholders, shall enforce the obligations of each WF Servicer under the
related Servicing Agreement, and shall, in the event that a WF Servicer fails to
perform its obligations in accordance with the related Servicing Agreement,
subject to the preceding paragraph, terminate the rights and obligations of such
WF Servicer thereunder and act as servicer of the related Mortgage Loans or to
cause the Trustee to enter in to a new Servicing Agreement with a successor
servicer selected by the Master Servicer;



                                      -59-
<PAGE>


provided, however, it is understood and acknowledged by the parties hereto that
there will be a period of transition (not to exceed 90 days) before the actual
servicing functions can be fully transferred to such successor servicer. Such
enforcement, including, without limitation, the legal prosecution of claims,
termination of 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, provided that the Master
Servicer shall not be required to prosecute or defend any legal action except to
the extent that the Master Servicer shall have received reasonable indemnity for
its costs and expenses in pursuing such action as set forth herein. In addition,
the Master Servicer, for the benefit of the Trustee and the Certificateholders,
shall enforce the obligations of each Sub-Master Servicer under the related Sub-
Master Servicing Agreement, and shall, in the event that a Sub-Master Servicer
fails to perform its obligations in accordance with the related Sub-Master
Servicing Agreement, subject to the preceding paragraph, terminate the rights
and obligations of such Sub-Master Servicer thereunder and directly master
servicer the related Mortgage Loans or cause the Trustee to enter in to a new
Sub-Master Servicing Agreement with a successor sub-master servicer selected by
the Master Servicer. In the event that the Master Servicer assumes the
obligations of any terminated Sub-Master Servicer under its Sub-Master Servicing
Agreement, the Master Servicer shall be entitled to the compensation to which
such Sub-Master Servicer would have been entitled to receive under such
Sub-Master Servicing Agreement from and after the date of the Master Servicer's
assumption of such obligations.

         (c) To the extent that the costs and expenses of the Master Servicer
related to any termination of a WF Servicer or a Sub-Master Servicer,
appointment of a successor WF Servicer or Sub-Master Servicer or the transfer
and assumption of servicing or sub-master servicing by the Master Servicer with
respect to any Servicing Agreement or Sub-Master Servicing Agreement (including,
without limitation, (i) all legal costs and expenses and all due diligence costs
and expenses associated with an evaluation of the potential termination of the
WF Servicer or Sub- Master Servicer as a result of an event of default by such
WF Servicer or Sub-Master Servicer and (ii) all costs and expenses associated
with the complete transfer of servicing or sub-master servicing, including all
servicing files and all servicing data and the completion, correction or
manipulation of such servicing data as may be required by the successor servicer
or successor sub-master servicer to correct any errors or insufficiencies in the
servicing data or otherwise to enable the successor servicer to service, or the
successor sub-master servicer to sub-master service, the Mortgage Loans in
accordance with the related Servicing Agreement or Sub-Master Servicing
Agreement) are not fully and timely reimbursed by the terminated Servicer or
Sub-Master Servicer, the Master Servicer shall be entitled to reimbursement of
such costs and expenses from the Master Servicer Collection Account.

         (d) The Master Servicer shall require each WF Servicer and each
Sub-Master Servicer to comply with the remittance requirements and other
obligations set forth in the related Servicing Agreement and the related
Sub-Master Servicing Agreement, as the case may be.

         (e) If the Master Servicer acts as Servicer or Sub-Master servicer, it
will not assume liability for the representations and warranties of the Servicer
or Sub-Master Servicer, if any, that it replaces.




                                      -60-
<PAGE>



         Section 3.04 FIDELITY BOND. The Master Servicer, at its expense, shall
maintain in effect a blanket fidelity bond and an errors and omissions insurance
policy, affording coverage with respect to all directors, officers, employees
and other Persons acting on such Master Servicer's behalf, and covering errors
and omissions in the performance of the Master Servicer's obligations hereunder.
The errors and omissions insurance policy and the fidelity bond shall be in such
form and amount generally acceptable for entities serving as master servicers or
trustees.

         Section 3.05 POWER TO ACT; PROCEDURES. The Master Servicer shall master
service the Mortgage Loans and shall have full power and authority, subject to
the REMIC Provisions and the provisions of Article X hereof, to do any and all
things that it may deem necessary or desirable in connection with the master
servicing and administration of the Mortgage Loans, including but not limited to
the power and authority (i) to execute and deliver, on behalf of the
Certificateholders and the Trustee, customary consents or waivers and other
instruments and documents, (ii) to consent to transfers of any Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages, (iii) to
collect any Insurance Proceeds and Liquidation Proceeds, and (iv) to effectuate
foreclosure or other conversion of the ownership of the Mortgaged Property
securing any Mortgage Loan, in each case, in accordance with the provisions of
this Agreement, the related Servicing Agreement and the related Sub-Master
Servicing Agreement, as applicable; provided, however, that the Master Servicer
shall not (and, consistent with its responsibilities under Section 3.03, shall
not permit any WF Servicer or Sub-Master Servicer to) knowingly or intentionally
take any action, or fail to take (or fail to cause to be taken) any action
reasonably within its control and the scope of duties more specifically set
forth herein, that, under the REMIC Provisions, if taken or not taken, as the
case may be, would cause any REMIC to fail to qualify as a REMIC or result in
the imposition of a tax upon the Trust Fund (including but not limited to the
tax on prohibited transactions as defined in Section 860F(a)(2) of the Code and
the tax on contributions to a REMIC set forth in Section 860G(d) of the Code)
unless the Master Servicer has received an Opinion of Counsel (but not at the
expense of the Master Servicer) to the effect that the contemplated action would
not cause any REMIC to fail to qualify as a REMIC or result in the imposition of
a tax upon any REMIC. The Trustee shall furnish the Master Servicer, upon
written request from a Servicing Officer, with any powers of attorney empowering
the Master Servicer, any Sub-Master Servicer or any Servicer to execute and
deliver instruments of satisfaction or cancellation, or of partial or full
release or discharge, and to foreclose upon or otherwise liquidate Mortgaged
Property, and to appeal, prosecute or defend in any court action relating to the
Mortgage Loans or the Mortgaged Property, in accordance with the applicable
Sub-Master Servicing Agreement, Servicing Agreement and this Agreement, and the
Trustee shall execute and deliver such other documents, as the Master Servicer
may request, to enable the Master Servicer to master service and administer the
Mortgage Loans and carry out its duties hereunder, in each case in accordance
with Accepted Master Servicing Practices (and the Trustee shall have no
liability for misuse of any such powers of attorney by the Master Servicer, any
Sub-Master Servicer or any Servicer). If the Master Servicer or the Trustee has
been advised that it is likely that the laws of the state in which action is to
be taken prohibit such action if taken in the name of the Trustee or that the
Trustee would be adversely affected under the "doing business" or tax laws of
such state if such action is taken in its name, the Master Servicer shall join
with the Trustee in the appointment of a co-trustee pursuant to Section 9.11
hereof. In the performance of its duties hereunder, the Master Servicer shall be
an independent



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contractor and shall not, except in those instances where it is taking action in
the name of the Trustee, be deemed to be the agent of the Trustee.

         Section 3.06 DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS. To the extent
provided in the applicable Servicing Agreement, to the extent Mortgage Loans
contain enforceable due-on-sale clauses, the Master Servicer shall cause the WF
Servicers to enforce such clauses in accordance with the applicable Servicing
Agreement and will cause the Sub-Master Servicers to enforce such clauses in
accordance with the applicable Sub-Master Servicing Agreement. If applicable law
prohibits the enforcement of a due-on-sale clause or such clause is otherwise
not enforced in accordance with the applicable Servicing Agreement, and, as a
consequence, a Mortgage Loan is assumed, the original Mortgagor may be released
from liability in accordance with the applicable Servicing Agreement.

         Section 3.07 RELEASE OF MORTGAGE FILES. (a) Upon becoming aware of the
payment in full of any Mortgage Loan, or the receipt by any Servicer of a
notification that payment in full has been escrowed in a manner customary for
such purposes for payment to Certificateholders on the next Distribution Date,
the Servicer will, if required under the applicable Servicing Agreement,
promptly furnish to the Custodian, on behalf of the Trustee, two copies of a
certification substantially in the form of Exhibit D hereto signed by a
Servicing Officer or in a mutually agreeable electronic format which will, in
lieu of a signature on its face, originate from a Servicing Officer (which
certification shall include a statement to the effect that all amounts received
in connection with such payment that are required to be deposited in the
Protected Account maintained by the applicable Servicer pursuant to Section 4.01
or by the applicable Servicer pursuant to its Servicing Agreement have been or
will be so deposited) and shall request that the Custodian, on behalf of the
Trustee, deliver to the applicable Servicer the related Mortgage File. Upon
receipt of such certification and request, the Custodian, on behalf of the
Trustee, shall promptly release the related Mortgage File to the applicable
Servicer and the Trustee and Custodian shall have no further responsibility with
regard to such Mortgage File. Upon any such payment in full, each Servicer is
authorized, to give, as agent for the Trustee, as the mortgagee under the
Mortgage that secured the Mortgage Loan, an instrument of satisfaction (or
assignment of mortgage without recourse) regarding the Mortgaged Property
subject to the Mortgage, which instrument of satisfaction or assignment, as the
case may be, shall be delivered to the Person or Persons entitled thereto
against receipt therefor of such payment, it being understood and agreed that no
expenses incurred in connection with such instrument of satisfaction or
assignment, as the case may be, shall be chargeable to the Protected Account.
Notwithstanding the foregoing, in connection with a Principal Prepayment in full
of any Mortgage Loan, the Master Servicer may request release of the related
Mortgage File from the Custodian, in accordance with the provisions of this
Agreement and the Custodial Agreement, in the event any Servicer or Sub-Master
Servicer fails to do so.

         (b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with the applicable Servicing
Agreement, the Trustee shall execute such documents as shall be prepared and
furnished to the Trustee by a Servicer or the Master Servicer (in form
reasonably acceptable to the Trustee) and as are necessary to the prosecution of
any such proceedings. The Custodian, on behalf of the Trustee, shall, upon the
request of a Servicer, a Sub- Master Servicer or the Master Servicer, and
delivery to the Custodian, on behalf of the Trustee, of two copies of a request
for release signed by a Servicing Officer



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<PAGE>


substantially in the form of Exhibit D (or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from a
Servicing Officer), release the related Mortgage File held in its possession or
control to the Servicer, Sub-Master Servicer or the Master Servicer, as
applicable. Such trust receipt shall obligate the Servicer, the Sub-Master
Servicer or the Master Servicer to return the Mortgage File to the Custodian on
behalf of the Trustee, when the need therefor by the Servicer, the Sub-Master
Servicer or the Master Servicer no longer exists unless the Mortgage Loan shall
be liquidated, in which case, upon receipt of a certificate of a Servicing
Officer similar to that hereinabove specified, the Mortgage File shall be
released by the Custodian, on behalf of the Trustee, to the Servicer, the Sub-
Master Servicer or the Master Servicer.

         Section 3.08 DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER
SERVICER TO BE HELD FOR TRUSTEE.

         (a) The Master Servicer shall transmit and each Servicer and Sub-Master
Servicer (to the extent required by the related Servicing Agreement or related
Sub-Master Servicing Agreement) shall transmit to the Custodian such documents
and instruments coming into the possession of the Master Servicer, such Servicer
or such Sub-Master Servicer from time to time as are required by the terms
hereof, or in the case of the Servicers and the Sub-Master Servicers, the
applicable Servicing Agreement or applicable Sub-Master Servicing Agreement, as
the case may be, to be delivered to the Custodian. Any funds received by the
Master Servicer, a Sub-Master Servicer or a Servicer in respect of any Mortgage
Loan or which otherwise are collected by the Master Servicer, a Sub-Master
Servicer or a Servicer as Liquidation Proceeds or Insurance Proceeds in respect
of any Mortgage Loan shall be held for the benefit of the Trustee and the
Certificateholders subject to (i) the Master Servicer's right to retain or
withdraw from the Master Servicer Collection Account the Master Servicing
Compensation and other amounts provided in this Agreement, (ii) each Sub-Master
Servicer's right to retain its Sub-Master Servicing Fee and other amounts as
provided in the applicable Sub-Master Servicing Agreement and (iii) each
Servicer's right to retain its Servicing Fee and other amounts as provided in
the applicable Servicing Agreement. The Master Servicer shall, and (to the
extent provided in the applicable Servicing Agreement) shall cause each WF
Servicer and each Sub-Master Servicer, to provide access to information and
documentation regarding the Mortgage Loans to the Trustee, its agents and
accountants at any time upon reasonable request and during normal business
hours, and to Certificateholders that are savings and loan associations, banks
or insurance companies, the Office of Thrift Supervision, the FDIC and the
supervisory agents and examiners of such Office and Corporation or examiners of
any other federal or state banking or insurance regulatory authority if so
required by applicable regulations of the Office of Thrift Supervision or other
regulatory authority, such access to be afforded without charge but only upon
reasonable request in writing and during normal business hours at the offices of
the Master Servicer designated by it. In fulfilling such a request the Master
Servicer shall not be responsible for determining the sufficiency of such
information.

         (b) All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer, in respect of any Mortgage Loans, whether from
the collection of principal and interest payments or from Liquidation Proceeds
or Insurance Proceeds, shall be held by the Master Servicer for and on behalf of
the Trustee and the Certificateholders and shall be and remain the sole and
exclusive property of the Trustee; provided, however, that the Master Servicer,
each Sub-Master Servicer and each Servicer shall be entitled to setoff against,
and deduct from, any such funds any



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<PAGE>


amounts that are properly due and payable to the Master Servicer, such
Sub-Master Servicer or such Servicer under this Agreement, the applicable
Sub-Master Servicing Agreement or the applicable Servicing Agreement.

         Section 3.09 STANDARD HAZARD INSURANCE AND FLOOD INSURANCE POLICIES.

         (a) For each Mortgage Loan, the Master Servicer shall enforce any
obligation of the WF Servicers under the related Servicing Agreements to, and
shall enforce any obligations of the Sub- Master Servicers under the related
Sub-Master Servicing Agreements to, maintain or cause to be maintained standard
fire and casualty insurance and, where applicable, flood insurance, all in
accordance with the provisions of the related Servicing Agreements. It is
understood and agreed that such insurance shall be with insurers meeting the
eligibility requirements set forth in the applicable Servicing Agreement and
that no earthquake or other additional insurance is to be required of any
Mortgagor or to be maintained on property acquired in respect of a defaulted
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.

         (b) Pursuant to Section 4.01 and 4.02, any amounts collected by the WF
Servicers, the Sub-Master Servicers or the Master Servicer, under any insurance
policies (other than amounts to be applied to the restoration or repair of the
property subject to the related Mortgage or released to the Mortgagor in
accordance with the applicable Servicing Agreement) shall be deposited into the
Master Servicer Collection Account, subject to withdrawal pursuant to Section
4.02 and 4.03. Any cost incurred by the Master Servicer, any Sub-Master Servicer
or any Servicer in maintaining any such insurance if the Mortgagor defaults in
its obligation to do so shall be added to the amount owing under the Mortgage
Loan where the terms of the Mortgage Loan so permit; provided, however, that the
addition of any such cost shall not be taken into account for purposes of
calculating the distributions to be made to Certificateholders and shall be
recoverable by the Master Servicer, such Sub-Master Servicer or such Servicer
pursuant to Section 4.02 and 4.03.

         Section 3.10 PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS. The
Master Servicer shall cause the WF Servicers (to the extent provided in the
applicable Servicing Agreements) to, and shall cause the Sub-Master Servicers
(to the extent provided in the applicable Sub-Master Servicing Agreements) to,
prepare and present on behalf of the Trustee and the Certificateholders all
claims under the Insurance Policies and take such actions (including the
negotiation, settlement, compromise or enforcement of the insured's claim) as
shall be necessary to realize recovery under such policies. Any proceeds
disbursed to the Master Servicer (or disbursed to a WF Servicer or a Sub-Master
Servicer (whether directly or through a Servicer) and remitted to the Master
Servicer) in respect of such policies, bonds or contracts shall be promptly
deposited in the Master Servicer Collection Account upon receipt, except that
any amounts realized that are to be applied to the repair or restoration of the
related Mortgaged Property as a condition precedent to the presentation of
claims on the related Mortgage Loan to the insurer under any applicable
Insurance Policy need not be so deposited (or remitted).



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<PAGE>


         Section 3.11 MAINTENANCE OF THE PRIMARY MORTGAGE INSURANCE POLICIES.

         (a) The Master Servicer shall not take, permit any WF Servicer (to the
extent such action is prohibited under the applicable Servicing Agreement) to
take or permit any Sub-Master Servicer (to the extent such action is prohibited
under the applicable Sub-Master Servicing Agreement) to take, any action that
would result in noncoverage under any applicable Primary Mortgage Insurance
Policy of any loss which, but for the actions of the Master Servicer, such
Sub-Master Servicer or such Servicer, would have been covered thereunder. The
Master Servicer shall use its best reasonable efforts to cause each WF Servicer
(to the extent required under the related Servicing Agreement) and to cause each
Sub-Master Servicer (to the extent required under the related Sub-Master
Servicing Agreement) to keep in force and effect (to the extent that the
Mortgage Loan requires the Mortgagor to maintain such insurance), primary
mortgage insurance applicable to each Mortgage Loan in accordance with the
provisions of this Agreement, the related Sub-Master Servicing Agreement and the
related Servicing Agreement, as applicable. The Master Servicer shall not, shall
not permit any WF Servicer (to the extent required under the related Servicing
Agreement) to, and shall not permit the Sub-Master Servicer (to the extent
required under the related Sub-Master Servicing Agreement) to, cancel or refuse
to renew any such Primary Mortgage Insurance Policy that is in effect at the
date of the initial issuance of the Mortgage Note and is required to be kept in
force hereunder except in accordance with the provisions of this Agreement, the
related Sub-Master Servicing Agreement and the related Servicing Agreement, as
applicable.

         (b) The Master Servicer agrees to present, to cause each WF Servicer
(to the extent required under the related Servicing Agreement) to present, or to
cause each Sub-Master Servicer (to the extent required under the related
Sub-Master Servicing Agreement) to present on behalf of the Trustee and the
Certificateholders, claims to the insurer under any Primary Mortgage Insurance
Policies and, in this regard, to take such reasonable action as shall be
necessary to permit recovery under any Primary Mortgage Insurance Policies
respecting defaulted Mortgage Loans. Pursuant to Section 4.01 and 4.02, any
amounts collected by the Master Servicer, any Sub-Master Servicer or any
Servicer under any Primary Mortgage Insurance Policies shall be deposited in the
Master Servicer Collection Account, subject to withdrawal pursuant to Sections
4.02 and 4.03.

         Section 3.12 TRUSTEE TO RETAIN POSSESSION OF CERTAIN INSURANCE POLICIES
AND DOCUMENTS.

         The Custodian, as agent of the Trustee, shall retain possession and
custody of the originals (to the extent available) of any Primary Mortgage
Insurance Policies if applicable, or certificate of insurance if applicable, and
any certificates of renewal as to the foregoing as may be issued from time to
time as contemplated by this Agreement. Until all amounts distributable in
respect of the Certificates have been distributed in full and the Master
Servicer otherwise has fulfilled its obligations under this Agreement, the
Custodian, as agent of the Trustee), shall also retain possession and custody of
each Mortgage File in accordance with and subject to the terms and conditions of
this Agreement. The Master Servicer shall promptly deliver or cause to be
delivered to the Custodian, as agent of the Trustee, upon the execution or
receipt thereof the originals of any Primary Mortgage Insurance Policies, any
certificates of renewal, and such other documents or instruments that constitute
portions of the Mortgage File that come into the possession of the Master
Servicer from time to time.



                                      -65-
<PAGE>


         Section 3.13 REALIZATION UPON DEFAULTED MORTGAGE LOANS.

         (a) The Master Servicer shall cause each WF Servicer (to the extent
required under the related Servicing Agreement) to, and shall cause each
Sub-Master Servicer (to the extent required under the related Sub-Master
Servicing Agreement) to, foreclose upon, repossess or otherwise comparably
convert the ownership of Mortgaged 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, all in
accordance with the applicable Servicing Agreement.

         (b) Notwithstanding paragraph (a) of this Section 3.13, in the event
that a Foreclosure Restricted Loan goes into foreclosure, if acquiring title to
the related Mortgaged Property by foreclosure or by deed in lieu of foreclosure
would cause (i) the adjusted basis (for federal income tax purposes) of the
Mortgaged Properties underlying the Foreclosure Restricted Loans that are
currently owned by REMIC I after foreclosure (along with any other assets owned
by REMIC I other than "qualified mortgages" and "permitted investments" within
the meaning of Section 860G of the Code) plus (ii) the aggregate Scheduled
Principal Balance of the Mortgage Loans listed on Exhibit L, to exceed 0.75% of
the adjusted basis of the assets of REMIC I, the Master Servicer, upon notice
from a Servicer that title is about to be taken to such Mortgaged Property as
REO Property on behalf of the Trust Fund, shall not permit such Servicer to
acquire title to such Mortgaged Property on behalf of REMIC I. Instead, the
Master Servicer shall notify the Seller that title is about to be taken to the
related Mortgaged Property as REO Property on behalf of the Trust Fund, and the
Seller shall repurchase such Foreclosure Restricted Loan from the Trust Fund at
the Repurchase Price. In the event that Seller fails to repurchase such Mortgage
Loan, the Master Servicer shall cause the related Servicer to dispose of the
Mortgage Loan for cash in the foreclosure sale. If such Mortgage Loan is not
purchased at foreclosure sale, such Mortgage Loan will be written-off in
accordance with the related Servicer's standard procedures. In addition, if the
Master Servicer determines that following a distribution on any Distribution
Date (i) the adjusted bases of the Mortgaged Properties underlying the
Foreclosure Restricted Loans in foreclosure (along with any other assets owned
by REMIC I other than "qualified mortgages" and "permitted investments" within
the meaning of Section 860G of the Code) plus (ii) the aggregate Scheduled
Principal Balance of the Mortgaged Loan listed on Exhibit L, exceed 1.0% of the
adjusted bases of the assets of REMIC I immediately after the distribution, then
prior to such Distribution Date, the Seller shall purchase enough of such
Mortgaged Properties in foreclosure, for cash, at the Repurchase Price, so that
the adjusted bases of (i) such Mortgaged Properties in foreclosure (along with
any other assets owned by REMIC I other than "qualified mortgages" and
"permitted investments" within the meaning of Section 860G of the Code) plus
(ii) the aggregate Scheduled Principal Balance of the Mortgaged Loans listed on
Exhibit L, will be less than 1.0% of the adjusted bases of the assets of REMIC
I.

         Section 3.14 COMPENSATION FOR THE MASTER SERVICER.

         On each Distribution Date the Master Servicer shall be paid the Master
Servicing Fee. In addition, on each Distribution Date, the Master Servicer shall
be entitled to all income and gain realized from any investment of funds in the
Distribution Account and the Master Servicer Collection Account, pursuant to
Article IV, for the performance of its activities hereunder (the "Additional
Master Servicing Compensation"). Servicing compensation in the form of
assumption



                                      -66-
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fees, if any, late payment charges, as collected, if any, or otherwise (but not
including any prepayment premium or penalty) shall be retained by the applicable
Servicer or Sub-Master Servicer, as the case may be, and shall not be deposited
in the Protected Account. The Master Servicer shall be required to pay all
expenses incurred by it in connection with its activities hereunder and shall
not be entitled to reimbursement therefor except as provided in this Agreement.

         Section 3.15 REO PROPERTY.

         (a) In the event the Trust Fund acquires ownership of any REO Property
in respect of any related Mortgage Loan, the deed or certificate of sale shall
be issued to the Trustee, or to its nominee, on behalf of the related
Certificateholders. The Master Servicer shall (to the extent provided in the
applicable Servicing Agreement) cause the applicable WF Servicer to, or cause
the applicable Sub- Master Servicer (to the extent provided in the related
Sub-Master Servicing Agreement) to sell, any REO Property as expeditiously as
possible and in accordance with the provisions of this Agreement, the related
Sub-Master Servicing Agreement and the related Servicing Agreement, as
applicable. Pursuant to its efforts to sell such REO Property, the Master
Servicer shall cause the applicable WF Servicer to, or shall cause the
applicable Sub-Master Servicer to, protect and conserve, such REO Property in
the manner and to the extent required by the applicable Servicing Agreement, in
accordance with the REMIC Provisions and in a manner that does not result in a
tax on "net income from foreclosure property" or cause such REO Property to fail
to qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code.

         (b) The Master Servicer shall, to the extent required by the related
Sub-Master Servicing Agreement and the related Servicing Agreement, cause the
applicable Sub-Master Servicer to deposit and cause the applicable WF Servicer
to deposit, all funds collected and received in connection with the operation of
any REO Property in the Protected Account.

         (c) The Master Servicer, the applicable Sub-Master Servicer (if any)
and the applicable Servicer, upon the final disposition of any REO Property,
shall be entitled to reimbursement for any related unreimbursed Monthly Advances
and other unreimbursed advances as well as any unpaid Servicing Fees, unpaid
Sub-Master Servicing Fees and unpaid Master Servicing Fees as applicable, from
Liquidation Proceeds received in connection with the final disposition of such
REO Property; provided, that any such unreimbursed Monthly Advances as well as
any unpaid Servicing Fees, unpaid Sub-Master Servicing Fees and unpaid Master
Servicing Fees may be reimbursed or paid, as the case may be, prior to final
disposition, out of any net rental income or other net amounts derived from such
REO Property.

         (d) To the extent provided in the related Servicing Agreement, the
Liquidation Proceeds from the final disposition of the REO Property, net of any
payment to the Master Servicer, the applicable Sub-Master Servicer (if any) and
the applicable Servicer as provided above, shall be deposited in the Protected
Account on or prior to the Determination Date in the month following receipt
thereof and be remitted by wire transfer in immediately available funds to the
Master Servicer (either directly or through a Sub-Master Servicer) for deposit
into the related Master Servicer Collection Account on the next succeeding
Servicer Remittance Date.



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         Section 3.16 ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.

         (a) The Master Servicer shall deliver to the Trustee and the Rating
Agencies on or before March 1 of each year, commencing on March 1, 2004, an
Officer's Certificate, certifying that with respect to the period ending
December 31 of the prior year: (i) such Servicing Officer has reviewed the
activities of such Master Servicer during the preceding calendar year or portion
thereof and its performance under this Agreement, (ii) to the best of such
Servicing Officer's knowledge, based on such review, such Master Servicer has
performed and fulfilled its duties, responsibilities and obligations under this
Agreement in all material respects throughout such year, or, if there has been a
default in the fulfillment of any such duties, responsibilities or obligations,
specifying each such default known to such Servicing Officer and the nature and
status thereof, (iii) nothing has come to the attention of such Servicing
Officer to lead such Servicing Officer to believe that any Servicer or
Sub-Master Servicer has failed to perform any of its duties, responsibilities
and obligations under its Servicing Agreement or Sub-Master Servicing Agreement,
as the case may be, in all material respects throughout such year, or, if there
has been a material default in the performance or fulfillment of any such
duties, responsibilities or obligations, specifying each such default known to
such Servicing Officer and the nature and status thereof.

         (b) Copies of such statements shall be provided to any
Certificateholder upon request, by the Master Servicer or by the Trustee at the
Master Servicer's expense if the Master Servicer failed to provide such copies
(unless (i) the Master Servicer shall have failed to provide the Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer's
failure to provide such statement).

         (c) The Securities Administrator shall deliver to the Seller, or any
affiliate of the Seller that is executing any Form 10-K to be filed pursuant to
Section 3.18, on or before March 1 of each year that a Form 10-K is filed, a
Master Servicer Certification with respect to the period ending December 31 of
the prior year.

         Section 3.17 ANNUAL INDEPENDENT ACCOUNTANT'S SERVICING REPORT. If the
Master Servicer has, during the course of any fiscal year, directly serviced any
of the Mortgage Loans, then the Master Servicer at its expense shall cause a
nationally recognized firm of independent certified public accountants to
furnish a statement to the Trustee, the Rating Agencies and the Seller on or
before March 1 of each year, commencing on March 1, 2004 to the effect that,
with respect to the most recently ended fiscal year, such firm has examined
certain records and documents relating to the Master Servicer's performance of
its servicing obligations under this Agreement and pooling and servicing and
trust agreements in material respects similar to this Agreement and to each
other and that, on the basis of such examination conducted substantially in
compliance with the audit program for mortgages serviced for Freddie Mac or the
Uniform Single Attestation Program for Mortgage Bankers, such firm is of the
opinion that the Master Servicer's activities have been conducted in compliance
with this Agreement, or that such examination has disclosed no material items of
noncompliance except for (i) such exceptions as such firm believes to be
immaterial, (ii) such other exceptions as are set forth in such statement and
(iii) such exceptions that the Uniform Single Attestation Program for Mortgage
Bankers or the Audit Program for Mortgages Serviced by Freddie Mac requires it
to report. Copies of such statements shall be provided to any Certificateholder
upon request by the Master Servicer, or by the Trustee at the expense of the




                                      -68-
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Master Servicer if the Master Servicer shall fail to provide such copies. If
such report discloses exceptions that are material, the Master Servicer shall
advise the Trustee whether such exceptions have been or are susceptible of cure,
and will take prompt action to do so.

         Section 3.18 REPORTS FILED WITH SECURITIES AND EXCHANGE COMMISSION. (a)
Within 15 days after each Distribution Date, the Securities Administrator shall,
in accordance with industry standards, file with the Commission via the
Electronic Data Gathering and Retrieval System ("EDGAR"), a Form 8-K with a copy
of the statement to the Certificateholders for such Distribution Date as an
exhibit thereto. If requested by the Seller, prior to January 30 of any year,
the Securities Administrator shall, in accordance with industry standards, file
a Form 15 Suspension Notice with respect to the Trust Fund. Prior to (i) March
15, 2004 and (ii) unless and until a Form 15 Suspension Notice shall have been
filed, prior to March 15 of each year thereafter, the Master Servicer shall,
subject to subsection (c), file a Form 10-K, in substance conforming to industry
standards, with respect to the Trust Fund. Such Form 10-K shall include, as
exhibits (i) each Servicer's and each Sub-Master Servicer's annual statement of
compliance described under the related Servicing Agreement or Sub-Master
Servicing Agreement, (ii) each Servicer's and each Sub-Master Servicer's
accountant's report described under the related Servicing Agreement or
Sub-Master Servicing Agreement, and (iii) the Master Servicer's accountant's
report described under Section 3.17, if applicable. If items (i) and (ii) in the
preceding sentence are not timely delivered, the Securities Administrator shall
file an amended Form 10-K including such documents as exhibits reasonably
promptly after they are delivered to the Master Servicer. The Seller hereby
grants to the Securities Administrator a limited power of attorney to execute
and file each Form 8-K on behalf of the Seller. Such power of attorney shall
continue until either the earlier of (i) receipt by the Securities Administrator
from the Seller of written termination of such power of attorney and (ii) the
termination of the Trust Fund. The Seller agrees to promptly furnish to the
Securities Administrator, from time to time upon request, such further
information, reports and financial statements within its control related to this
Agreement and the Mortgage Loans as the Securities Administrator reasonably
deems appropriate to prepare and file all necessary reports with the Commission.
The Securities Administrator will cooperate with the Seller in connection with
any additional filings with respect to the Trust Fund as the Seller deems
necessary under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). Copies of all reports filed by the Securities Administrator under the
Exchange Act shall be sent to: the Seller c/o Bear, Stearns & Co. Inc., Attn:
Managing Director- Analysis and Control, One Metrotech Center North, Brooklyn,
New York 11202-3859.

         (b) The Securities Administrator shall indemnify and hold harmless the
Seller, the Trustee and their respective officers, directors and Affiliates from
and against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments and other costs and expenses
arising out of or based upon a breach of the Securities Administrator's
obligations under this Section 3.18 or the Securities Administrator's
negligence, bad faith or willful misconduct in connection therewith. Fees and
expenses incurred by the Securities Administrator in connection with this
Section 3.18 shall not be reimbursable from the Trust Fund.

         (c) Nothing shall be construed from the foregoing subsection (a) and
(b) to require the Securities Administrator or any officer, director or
Affiliate thereof to sign any Form 10-K



                                      -69-
<PAGE>


or any certification contained therein. The failure of the Securities
Administrator to sign the Form 10-K or any certification contained therein shall
not be regarded as a breach by the Securities Administrator of this Agreement.
Furthermore, the inability of the Securities Administrator to file a Form 10-K
as a result of the lack of required signatures on such Form 10-K or any
certification contained therein shall not be regarded as a breach by the
Securities Administrator of any obligation under this Agreement.

         Section 3.19 EMC. On the Closing Date, EMC will receive from the Seller
a payment of $5,000.

         Section 3.20 UCC. The Seller shall inform the Trustee in writing of any
Uniform Commercial Code financing statements that were filed on the Closing Date
in connection with the Trust with stamped recorded copies of such financing
statements to be delivered to the Trustee promptly upon receipt by the Seller.
The Seller shall file any financing statements or amendments thereto required by
any change in the Uniform Commercial Code.

         Section 3.21 OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS.

         (a) With respect to any Mortgage Loan which as of the first day of a
Calendar Quarter is delinquent in payment by 90 days or more or is an REO
Property, EMC shall have the right to purchase such Mortgage Loan from the Trust
at a price equal to the Repurchase Price; provided however (i) that such
Mortgage Loan is still 90 days or more delinquent or is an REO Property as of
the date of such purchase and (ii) this purchase option, if not theretofore
exercised, shall terminate on the date prior to the last day of the related
Calendar Quarter. This purchase option, if not exercised, shall not be
thereafter reinstated unless the delinquency is cured and the Mortgage Loan
thereafter again becomes 90 days or more delinquent or becomes an REO Property,
in which case the option shall again become exercisable as of the first day of
the related Calendar Quarter.

         (b) If at any time EMC remits to the Master Servicer a payment for
deposit in the Master Servicer Collection Account covering the amount of the
Repurchase Price for such a Mortgage Loan, and EMC provides to the Trustee a
certification signed by a Servicing Officer stating that the amount of such
payment has been deposited in the Master Servicer Collection Account, then the
Trustee shall execute the assignment of such Mortgage Loan to EMC at the request
of EMC without recourse, representation or warranty, the Custodian shall, upon
receipt of a Request for Release in accordance with the Custodial Agreement,
release such Mortgage Loan to EMC and EMC shall succeed to all of the Trustee's
right, title and interest in and to such Mortgage Loan, and all security and
documents relative thereto. Such assignment shall be an assignment outright and
not for security. EMC will thereupon own such Mortgage, and all such security
and documents, free of any further obligation to the Trustee or the
Certificateholders with respect thereto.




                                      -70-
<PAGE>



                                   ARTICLE IV
                                    Accounts

         Section 4.01 PROTECTED ACCOUNTS. (a) The Master Servicer shall enforce
the obligation of each WF Servicer and each Sub-Master Servicer to establish and
maintain a Protected Account in accordance with the applicable Servicing
Agreement or Sub-Master Servicing Agreement, as the case may be, in each case,
with records to be kept with respect thereto on a Mortgage Loan by Mortgage Loan
basis, into which accounts shall be deposited within 48 hours (or as of such
other time specified in the related Servicing Agreement or Sub-Master Servicing
Agreement) of receipt, all collections of principal and interest on any Mortgage
Loan and any REO Property received by a Servicer or a Sub-Master Servicer,
including Principal Prepayments, Insurance Proceeds, Liquidation Proceeds, and
advances made from the Servicer's or Sub-Master Servicer's own funds (less
servicing or sub-master servicing compensation as permitted by the applicable
Servicing Agreement or Sub- Master Servicing Agreement in the case of any
Servicer or any Sub-Master Servicer) and all other amounts to be deposited in
the Protected Account. Each Servicer and Sub-Master Servicer is hereby
authorized to make withdrawals from and deposits to the related Protected
Account for purposes required or permitted by this Agreement. To the extent
provided in the related Servicing Agreement or Sub-Master Servicing Agreement,
the Protected Account shall be held by a Designated Depository Institution and
segregated on the books of such institution in the name of the Trustee for the
benefit of Certificateholders.

         (b) To the extent provided in the related Servicing Agreement or
Sub-Master Servicing Agreement, amounts on deposit in a Protected Account may be
invested in Permitted Investments in the name of the Trustee for the benefit of
Certificateholders and, except as provided in the preceding paragraph, not
commingled with any other funds. Such Permitted Investments shall mature, or
shall be subject to redemption or withdrawal, no later than the date on which
such funds are required to be withdrawn for deposit in the Master Servicer
Collection Account, and shall be held until required for such deposit. The
income earned from Permitted Investments made pursuant to this Section 4.01
shall be paid to the related Servicer or Sub-Master Servicer under the
applicable Servicing Agreement or Sub-Master Servicing Agreement, and the risk
of loss of moneys required to be distributed to the Certificateholders resulting
from such investments shall be borne by and be the risk of the related Servicer
or Sub-Master Servicer, as the case may be. The related Servicer or Sub-Master
Servicer (to the extent provided in the Servicing Agreement or Sub-Master
Servicing Agreement) shall deposit the amount of any such loss in the Protected
Account within two Business Days of receipt of notification of such loss but not
later than the second Business Day prior to the Distribution Date on which the
moneys so invested are required to be distributed to the Certificateholders.

         (c) To the extent provided in the related Servicing Agreement and
subject to this Article IV, on or before each Servicer Remittance Date, (i) the
related WF Servicer shall withdraw or shall cause to be withdrawn from its
Protected Accounts and shall immediately deposit or cause to be deposited in the
Master Servicer Collection Account, and (ii) the related Sub-Master Servicer
shall withdraw or shall cause to be withdrawn from its Protected Accounts and
shall immediately deposit or cause to be deposited in the Master Servicer
Collection Account amounts representing the following collections and payments
(other than with respect to principal of or interest on the Mortgage Loans due
on or before the Cut-off Date) with respect to each Loan Group:




                                      -71-
<PAGE>



                  (i) Scheduled Payments on the Mortgage Loans received or any
         related portion thereof advanced by such Servicer pursuant to its
         Servicing Agreement or such Sub-Master Servicer pursuant to its
         Sub-Master Servicing Agreement which were due on or before the related
         Due Date, net of the amount thereof comprising its Servicing Fee or
         Sub-Master Servicing Fee or any fees with respect to any lender-paid
         primary mortgage insurance policy;

                  (ii) Full Principal Prepayments and any Liquidation Proceeds
         received by such Servicer or such Sub-Servicer with respect to the
         Mortgage Loans in the related Prepayment Period, with interest to the
         date of prepayment or liquidation, net of the amount thereof comprising
         its Servicing Fee or Sub-Master Servicing Fee;

                  (iii) Partial Principal Prepayments received by such Servicer
         or such Sub-Master Servicer for the Mortgage Loans in the related
         Prepayment Period; and

                  (iv) Any amount to be used as a Monthly Advance.

         (d) Withdrawals may be made from an Account only to make remittances as
provided in Section 4.01(c), 4.02 and 4.03; to reimburse the Master Servicer,
the Sub-Master Servicer or a Servicer for Monthly Advances which have been
recovered by subsequent collections from the related Mortgagor; to remove
amounts deposited in error; to remove fees, charges or other such amounts
deposited on a temporary basis; or to clear and terminate the account at the
termination of this Agreement in accordance with Section 10.01. As provided in
Sections 4.01(c) and 4.02(b) certain amounts otherwise due to the Servicers and
the Sub-Master Servicers may be retained by them and need not be deposited in
the Master Servicer Collection Account.

         Section 4.02 MASTER SERVICER COLLECTION ACCOUNT. (a) The Master
Servicer shall establish and maintain in the name of the Trustee, for the
benefit of the Certificateholders, the Master Servicer Collection Account as a
segregated trust account or accounts. The Master Servicer Collection Account
shall be an Eligible Account. The Master Servicer will deposit in the Master
Servicer Collection Account as identified by the Master Servicer and as received
by the Master Servicer, the following amounts:

                  (i) Any amounts withdrawn from a Protected Account;

                  (ii) Any Monthly Advance and any Compensating Interest
         Payments;

                  (iii) Any Insurance Proceeds or Net Liquidation Proceeds
         received by or on behalf of the Master Servicer or which were not
         deposited in a Protected Account;

                  (iv) The Repurchase Price with respect to any Mortgage Loans
         purchased by the Mortgage Loan Seller pursuant to the Mortgage Loan
         Purchase Agreement or Sections 2.02 or 2.03 hereof, any amounts which
         are to be treated pursuant to Section 2.04 of this Agreement as the
         payment of a Repurchase Price in connection with the tender of a
         Substitute Mortgage Loan by the Mortgage Loan Seller, the Repurchase
         Price with respect to any Mortgage Loans purchased by EMC pursuant to
         Section 3.21, and all proceeds of any



                                      -72-
<PAGE>


         Mortgage Loans or property acquired with respect thereto repurchased by
         the Seller or its designee pursuant to Section 10.01;

                  (v) Any amounts required to be deposited with respect to
         losses on investments of deposits in an Account; and

                  (vi) Any other amounts received by or on behalf of the Master
         Servicer and required to be deposited in the Master Servicer Collection
         Account pursuant to this Agreement.

         (b) All amounts deposited to the Master Servicer Collection Account
shall be held by the Master Servicer in the name of the Trustee in trust for the
benefit of the Certificateholders in accordance with the terms and provisions of
this Agreement. The requirements for crediting the Master Servicer Collection
Account or the Distribution Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing, payments in the
nature of (i) prepayment or late payment charges or assumption, tax service,
statement account or payoff, substitution, satisfaction, release and other like
fees and charges and (ii) the items enumerated in Subsections 4.05(a)(i), (ii),
(iii), (iv), (vi), (vii), (viii), (ix), (x), (xi) and (xii), need not be
credited by the Master Servicer, the related Sub-Master Servicer or the related
Servicer to the Distribution Account or the Master Servicer Collection Account,
as applicable. In the event that the Master Servicer shall deposit or cause to
be deposited to the Distribution Account any amount not required to be credited
thereto, the Trustee, upon receipt of a written request therefor signed by a
Servicing Officer of the Master Servicer, shall promptly transfer such amount to
the Master Servicer, any provision herein to the contrary notwithstanding.

         (c) The amount at any time credited to the Master Servicer Collection
Account may be invested, in the name of the Trustee, or its nominee, for the
benefit of the Certificateholders, in Permitted Investments as directed by
Master Servicer. All Permitted Investments shall mature or be subject to
redemption or withdrawal on or before, and shall be held until, the next
succeeding Distribution Account Deposit Date. Any and all investment earnings on
amounts on deposit in the Master Servicer Account from time to time shall be for
the account of the Master Servicer. The Master Servicer from time to time shall
be permitted to withdraw or receive distribution of any and all investment
earnings from the Master Servicer Account. The risk of loss of moneys required
to be distributed to the Certificateholders resulting from such investments
shall be borne by and be the risk of the Master Servicer. The Master Servicer
shall deposit the amount of any such loss in the Master Servicer Collection
Account within two Business Days of receipt of notification of such loss but not
later than the second Business Day prior to the Distribution Date on which the
moneys so invested are required to be distributed to the Certificateholders.

         Section 4.03 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE MASTER
SERVICER COLLECTION ACCOUNT. (a) The Master Servicer will, from time to time on
demand of a WF Servicer, a Sub-Master Servicer or the Securities Administrator,
make or cause to be made such withdrawals or transfers from the Master Servicer
Collection Account as the Master Servicer has designated for such transfer or
withdrawal pursuant to this Agreement, the related Sub-Master Servicing
Agreement or the related Servicing Agreement. The Master Servicer may clear and
terminate the


                                      -73-
<PAGE>


Master Servicer Collection Account pursuant to Section 10.01 and remove amounts
from time to time deposited in error.

         (b) On an ongoing basis, the Master Servicer shall withdraw from the
Master Servicer Collection Account (i) any expenses recoverable by the Trustee,
the Master Servicer or the Securities Administrator or the Custodian pursuant to
Sections 3.03, 7.04 and 9.05 and (ii) any amounts payable to the Master Servicer
as set forth in Section 3.14.

         (c) In addition, on or before each Distribution Account Deposit Date,
the Master Servicer shall deposit in the Distribution Account (or remit to the
Trustee for deposit therein) any Monthly Advances required to be made by the
Master Servicer with respect to the Mortgage Loans.

         (d) No later than 3:00 p.m. New York time on each Distribution Account
Deposit Date, the Master Servicer will transfer all Available Funds on deposit
in the Master Servicer Collection Account with respect to the related
Distribution Date to the Trustee for deposit in the Distribution Account.

         Section 4.04 DISTRIBUTION ACCOUNT. (a) The Trustee shall establish and
maintain in the name of the Trustee, for the benefit of the Certificateholders,
the Distribution Account as a segregated trust account or accounts.

         (b) All amounts deposited to the Distribution Account shall be held by
the Trustee in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement.

         (c) The Distribution Account shall constitute a trust account of the
Trust Fund segregated on the books of the Trustee and held by the Trustee in
trust in its Corporate Trust Office, and the Distribution Account and the funds
deposited therein shall not be subject to, and shall be protected from, all
claims, liens, and encumbrances of any creditors or depositors of the Trustee or
the Master Servicer (whether made directly, or indirectly through a liquidator
or receiver of the Trustee or the Master Servicer). The Distribution Account
shall be an Eligible Account. The amount at any time credited to the
Distribution Account shall be invested in the name of the Trustee, in such
Permitted Investments selected by the Master Servicer or deposited in demand
deposits with such depository institutions as selected by the Master Servicer,
provided that time deposits of such depository institutions would be a Permitted
Investment and the Trustee receives such funds no later than 2:00 p.m New York
time on the Distribution Account Deposit Date. All Permitted Investments shall
mature or be subject to redemption or withdrawal on or before, and shall be held
until, the next succeeding Distribution Date if the obligor for such Permitted
Investment is the Trustee or, if such obligor is any other Person, the Business
Day preceding such Distribution Date. All investment earnings on amounts on
deposit in the Distribution Account or benefit from funds uninvested therein
from time to time shall be for the account of the Master Servicer. The Master
Servicer shall be permitted to withdraw or receive distribution of any and all
investment earnings from the Distribution Account on each Distribution Date. If
there is any loss on a Permitted Investment or demand deposit, the Master
Servicer shall remit the amount of the loss to the Trustee who shall deposit
such amount in the Distribution Account. With respect to the Distribution
Account and the funds deposited therein, the Master Servicer shall take such
action as may be necessary to ensure



                                      -74-
<PAGE>


that the Certificateholders shall be entitled to the priorities afforded to such
a trust account (in addition to a claim against the estate of the Trustee) as
provided by 12 U.S.C. ss. 92a(e), and applicable regulations pursuant thereto,
if applicable, or any applicable comparable state statute applicable to state
chartered banking corporations. In the event that funds are received by the
Trustee after 2:00 p.m. New York time on the Distribution Account Deposit Date,
funds in the Distribution Account shall be held uninvested. The Trustee or its
Affiliates are permitted to receive additional compensation that could be deemed
to be in the Trustee's economic self-interest for (i) servicing as investment
advisor, administrator, shareholder, servicing agent, custodian or sub-custodian
with respect to certain of the Permitted Investments, (ii) using Affiliates to
effect transactions in certain Permitted Investments and (iii) effecting
transactions in certain permitted investments.

         Section 4.05 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE DISTRIBUTION
ACCOUNT. (a) The Trustee will, from time to time on demand of the Master
Servicer or the Securities Administrator, make or cause to be made such
withdrawals or transfers from the Distribution Account as the Master Servicer
has designated for such transfer or withdrawal pursuant to this Agreement and
the Servicing Agreements or as the Securities Administrator has instructed
hereunder for the following purposes (limited in the case of amounts due the
Master Servicer to those not withdrawn from the Master Servicer Collection
Account in accordance with the terms of this Agreement):

                  (i) to reimburse the Master Servicer, any Sub-Master Servicer
         or any Servicer for any Monthly Advance of its own funds, the right of
         the Master Servicer, a Sub-Master Servicer or a Servicer to
         reimbursement pursuant to this subclause (i) being limited to amounts
         received on a particular Mortgage Loan (including, for this purpose,
         the Repurchase Price therefor, Insurance Proceeds and Liquidation
         Proceeds) which represent late payments or recoveries of the principal
         of or interest on such Mortgage Loan respecting which such Monthly
         Advance was made;

                  (ii) to reimburse the Master Servicer, any Sub-Master Servicer
         or any Servicer from Insurance Proceeds or Liquidation Proceeds
         relating to a particular Mortgage Loan for amounts expended by the
         Master Servicer, such Sub-Master Servicer or such Servicer in good
         faith in connection with the restoration of the related Mortgaged
         Property which was damaged by an Uninsured Cause or in connection with
         the liquidation of such Mortgage Loan;

                  (iii) to reimburse the Master Servicer, any Sub-Master
         Servicer or any Servicer from Insurance Proceeds relating to a
         particular Mortgage Loan for insured expenses incurred with respect to
         such Mortgage Loan and to reimburse the Master Servicer, such
         Sub-Master Servicer or such Servicer from Liquidation Proceeds from a
         particular Mortgage Loan for Liquidation Expenses incurred with respect
         to such Mortgage Loan; provided that the Master Servicer shall not be
         entitled to reimbursement for Liquidation Expenses with respect to a
         Mortgage Loan to the extent that (i) any amounts with respect to such
         Mortgage Loan were paid as Excess Liquidation Proceeds pursuant to
         clause (x) of this Subsection 4.05 (a) to the Master Servicer; and (ii)
         such Liquidation Expenses were not included in the computation of such
         Excess Liquidation Proceeds;



                                      -75-
<PAGE>


                  (iv) to pay the Master Servicer, any Sub-Master Servicer or
         any Servicer, as appropriate, from Liquidation Proceeds or Insurance
         Proceeds received in connection with the liquidation of any Mortgage
         Loan, the amount which it, such Sub-Master Servicer or such Servicer
         would have been entitled to receive under subclause (ix) of this
         Subsection 4.05(a) as servicing compensation on account of each
         defaulted scheduled payment on such Mortgage Loan if paid in a timely
         manner by the related Mortgagor;

                  (v) to pay the Master Servicer, any Sub-Master Servicer or any
         Servicer from the Repurchase Price for any Mortgage Loan, the amount
         which it, such Sub-Master Servicer or such Servicer would have been
         entitled to receive under subclause (ix) of this Subsection 4.05 (a) as
         servicing compensation;

                  (vi) to reimburse the Master Servicer, any Sub-Master Servicer
         or any Servicer for advances of funds (other than Monthly Advances)
         made with respect to the Mortgage Loans, and the right to reimbursement
         pursuant to this subclause being limited to amounts received on the
         related Mortgage Loan (including, for this purpose, the Repurchase
         Price therefor, Insurance Proceeds and Liquidation Proceeds) which
         represent late recoveries of the payments for which such advances were
         made;

                  (vii) to reimburse the Master Servicer, any Sub-Master
         Servicer or any Servicer for any Monthly Advance or advance, after a
         Realized Loss has been allocated with respect to the related Mortgage
         Loan if the Monthly Advance or advance has not been reimbursed pursuant
         to clauses (i) and (vi);

                  (viii) to pay the Master Servicer as set forth in Section
         3.14;

                  (ix) to reimburse the Master Servicer for expenses, costs and
         liabilities incurred by and reimbursable to it pursuant to Sections
         3.03, 7.04(c) and (d);

                  (x) to pay to the Master Servicer, as additional servicing
         compensation, any Excess Liquidation Proceeds to the extent not
         retained by the related Servicer or Sub-Master Servicer;

                  (xi) to reimburse or pay any Sub-Master Servicer or Servicer
         any such amounts as are due thereto under the applicable Sub-Master
         Servicing Agreement or Servicing Agreement and have not been retained
         by or paid to such Sub-Master Servicer or such Servicer, to the extent
         provided in the related Sub-Master Servicing Agreement or Servicing
         Agreement, as the case may be;

                  (xii) to reimburse the Trustee, the Securities Administrator
         or the Custodian for expenses, costs and liabilities incurred by or
         reimbursable to it pursuant to this Agreement;

                  (xiii) to remove amounts deposited in error; and

                  (xiv) to clear and terminate the Distribution Account pursuant
         to Section 10.01.



                                      -76-
<PAGE>


         (b) The Master Servicer shall keep and maintain separate accounting, on
a Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
reimbursement from the Distribution Account pursuant to subclauses (i) through
(vi), inclusive, and (viii) or with respect to any such amounts which would have
been covered by such subclauses had the amounts not been retained by the Master
Servicer without being deposited in the Distribution Account under Section
4.02(b).

         (c) On each Distribution Date, the Trustee shall distribute the
Available Funds to the extent on deposit in the Distribution Account for each
Loan Group to the Holders of the Certificates in accordance with distribution
instructions provided to it by the Securities Administrator no later than two
Business Days prior to such Distribution Date and determined by the Securities
Administrator in accordance with Section 6.01.




                                      -77-
<PAGE>



                                    ARTICLE V
                                  Certificates

         Section 5.01 CERTIFICATES. (a) The Depository, the Seller and the
Trustee have entered into a Depository Agreement dated as of the Closing Date
(the "Depository Agreement"). Except for the Residual Certificates, the Private
Certificates and the Individual Certificates and as provided in Subsection
5.01(b), the Certificates shall at all times remain registered in the name of
the Depository or its nominee and at all times: (i) registration of such
Certificates may not be transferred by the Trustee except to a successor to the
Depository; (ii) ownership and transfers of registration of such Certificates on
the books of the Depository shall be governed by applicable rules established by
the Depository; (iii) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (iv) the Trustee shall
deal with the Depository as representative of such Certificate Owners of the
respective Class of Certificates for purposes of exercising the rights of
Certificateholders under this Agreement, and requests and directions for and
votes of such representative shall not be deemed to be inconsistent if they are
made with respect to different Certificate Owners; and (v) the Trustee may rely
and shall be fully protected in relying upon information furnished by the
Depository with respect to its Depository Participants.

         The Residual Certificates and the Private Certificates are initially
Physical Certificates. If at any time the Holders of all of the Certificates of
one or more such Classes request that the Trustee cause such Class to become
Global Certificates, the Trustee and the Seller will take such action as may be
reasonably required to cause the Depository to accept such Class or Classes for
trading if it may legally be so traded.

         All transfers by Certificate Owners of such respective Classes of
Book-Entry Certificates and any Global Certificates shall be made in accordance
with the procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer 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.

         (b) If (i)(A) the Seller advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Seller is unable to locate a
qualified successor within 30 days or (ii) the Seller at its option (with the
consent of the Trustee) advises the Trustee in writing that it elects to
terminate the book-entry system through the Depository, the Trustee shall
request that the Depository notify all Certificate Owners of the occurrence of
any such event and of the availability of definitive, fully registered
Certificates to Certificate Owners requesting the same. Upon surrender to the
Trustee of the Certificates by the Depository, accompanied by registration
instructions from the Depository for registration, the Trustee shall issue the
definitive Certificates. Neither the Seller nor the Trustee shall be liable for
any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions.

         (c) (i) REMIC I will be evidenced by (x) the REMIC I Regular Interests
(designated below), which will be uncertificated and non-transferable and are
hereby designated as the "regular interests" in REMIC I and have the principal
balances and accrue interest at the Pass-Through Rates



                                      -78-
<PAGE>



equal to those set forth in this Section 5.01(c)(i) and (y) the Class R-I
Certificates, which is hereby designated as the single "residual interest" in
REMIC I.
         The REMIC I Regular Interests and the Class R-I Certificate will have
the following designations, initial balances and pass-through rates:


REMIC I Interest       Initial Balance      Pass-Through Rate     Related Group
----------------       ---------------      -----------------     -------------
      I-1X                   (1)                   (2)              Group I-1
     I-1SUB             $       251.54            8.00%             Group I-1
     I-1PO              $ 1,987,343.18            0.00%             Group I-1
     I-1ZZZ             $81,858,444.92            8.00%             Group I-1
      I-2X                   (3)                   (4)              Group I-2
     I-2SUB             $       143.59            7.50%             Group I-2
     I-2PO              $ 1,315,565.35            0.00%             Group I-2
     I-2ZZZ             $46,547,708.33            7.50%             Group I-2
   Class R-I            $        50.00             N/A              Group I-2

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


(1)      REMIC I Regular Interest I-1X will not have an Uncertificated Principal
         Balance, but will accrue interest on a notional amount equal to the
         aggregate Scheduled Principal Balance of the Group I-1 Mortgage Loans.
(2)      The weighted average of the greater of (i) zero and (ii) the excess of
         (a) the Net Rate of the each Group I-1 Mortgage Loan over (b) 8.00%,
         weighted on the basis of the respective Scheduled Principal Balance of
         each such Mortgage Loan as of the beginning of the Due Period
         immediately preceding the related Distribution Date.

(3)      REMIC I Regular Interest I-2X will not have an Uncertificated Principal
         Balance, but will accrue interest on a notional amount equal to the
         aggregate Scheduled Principal Balance of the Group I-2 Mortgage Loans.

(4)      The weighted average of the greater of (i) zero and (ii) the excess of
         (a) the Net Rate of the each Group I-2 Mortgage Loan over (b) 7.50%,
         weighted on the basis of the respective Scheduled Principal Balance of
         each such Mortgage Loan as of the beginning of the Due Period
         immediately preceding the related Distribution Date.

         On each Distribution Date, Distributions shall be deemed to be made to
the REMIC I Regular Interests first, so as to keep the Uncertificated Principal
Balance of each Uncertificated REMIC I Regular Interest ending with the
designation "SUB" equal to 0.01% of the Group I-1 Subordinate Amount and Group
I-2 Subordinate Amount, as the case may be (except that if on any Distribution
Date the Subordinate Amount for any Loan Group is greater than the Subordinate
Amount for such Loan Group on the preceding Distribution Date, the least amount
of principal shall be distributed to REMIC I Regular Interest I-1SUB and REMIC I
Regular Interest I-2SUB necessary to maintain the ratio among the principal
amounts of REMIC I Regular Interest I-1SUB and REMIC I Regular Interest I-2SUB
equal to the REMIC I Subordinate Balance Ratio); and second, any remaining
principal relating to Loan Group I-1 and Loan Group I-2 shall be distributed to
the REMIC I Regular Interest I-1ZZZ and REMIC I Regular Interest I-2ZZZ,
respectively (provided that a portion of the remaining principal equal to the
Class I-PO Certificate Principal Distribution Amount attributable to the Group
I-1 Mortgage Loans and the Class I-PO Certificate Principal Distribution Amount
attributable to the Group I-2 Mortgage Loans will be distributed to REMIC I
Regular Interest I-1PO and REMIC I Regular Interest I-2PO, respectively).

         In determining from time to time the Uncertificated REMIC I Regular
Interest distribution amounts, Realized Losses shall be applied after all
distributions have been made on each



                                      -79-
<PAGE>


Distribution Date first, so as to keep the Uncertificated Principal Balance of
each Uncertificated REMIC I Regular Interest ending with the designation "SUB"
equal to 0.01% of the Group I-1 Subordinate Amount and Group I-2 Subordinate
Amount, as the case may be (except that if on any Distribution Date the
Subordinate Amount for any Loan Group is greater than the Subordinate Amount for
such Loan Group on the preceding Distribution Date, the least amount of Realized
Losses shall be applied to REMIC I Regular Interest I-1SUB and REMIC I Regular
Interest I-2SUB necessary to maintain the ratio among the principal amount of
REMIC I Regular Interest I-1SUB and REMIC I Regular Interest I-2SUB equal to the
REMIC I Subordinate Balance Ratio); and second, except as described in the
remaining sentence of this paragraph, the remaining Realized Losses shall be
allocated to REMIC I Regular Interest I-1ZZZ and REMIC I Regular Interest
I-2ZZZ, as applicable (except that if a Realized Loss is recognized with respect
to a Group I-1 Discount Mortgage Loan or a Group I-2 Discount Loan, the
applicable portion of such Realized Loss will be allocated to REMIC I Regular
Interest I-1PO and REMIC I Regular Interest I-2PO, respectively). Realized
Losses of interest allocated to the Class I-X-1 Certificates under Section 6.02
from the Group I-1 Mortgage Loans shall be deemed allocated to REMIC I Regular
Interest I-1X. Realized Losses of interest allocated to the Class I-X-1
Certificates under Section 6.02 from the Group I-2 Mortgage Loans shall be
deemed allocated to REMIC I Regular Interest I-2X.

         (ii) REMIC II will be evidenced by (x) the REMIC II Regular Interests
(designated below), which will be uncertificated and non-transferable and are
hereby designated as the "regular interests" in REMIC II and have the principal
balances and accrue interest at the Pass-Through Rates equal to those set forth
in this Section 5.01(c)(ii) and (y) the Class R-II Certificate, which is hereby
designated as the single "residual interest" in REMIC II.

         The REMIC II Regular Interests and the Class R-II Certificate will have
the following designations, initial balances and pass-through rates:


 REMIC II Interest       Initial Balance     Pass-Through Rate    Related Group
 -----------------       ---------------     -----------------    -------------
        II-A             $42,656,387.99            (1)              Group II

     Class R-II          $        50.00            N/A              Group II

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

(1)      The weighted average of the Net Rates of the Group II Mortgage Loans,
         weighted on the basis of the respective Scheduled Principal Balance of
         each such Mortgage Loan as of the beginning of the Due Period
         immediately preceding the related Distribution Date.

         Principal shall be payable to, and shortfalls, losses and prepayments
are allocable to, the REMIC II Regular Interests as such amounts are payable and
allocable to the Group II Mortgage Loans. Interest shall be payable to the REMIC
II Regular Interests at the Pass-Through Rate for each such REMIC II Regular
Interest on each such REMIC II Regular Interest's Uncertificated Principal
Balance.

         (iii) REMIC III will be evidenced by (x) the REMIC III Regular
Interests (designated below), which will be uncertificated and non-transferable
and are hereby designated as the "regular interests" in REMIC III and have the
principal balances and accrue interest at the Pass-Through



                                      -80-
<PAGE>



Rates equal to those set forth in this Section 5.01(c)(ii) and (y) the Class
R-III Certificate, which is hereby designated as the single "residual interest"
in REMIC III.

         The REMIC III Regular Interests and the Class R-III Certificate will
have the following designations, initial balances and pass-through rates:


         Designation       Initial Principal Balance      Pass-Through Rate
         -----------       -------------------------      -----------------
             I-F1             $   79,343,315                    8.00%
             I-F2             $   45,111,998                    7.50%
             I-I1             $  131,709,507(1)                  (2)
             I-PO             $    3,302,908.53                 0.00%
            II-A1             $   41,462,000                     (3)
            R-III             $           50                     (3)
            LT-RIV            $           50                     (3)
             I-B1             $    1,317,095                     (4)
             I-B2             $      987,821                     (4)
             I-B3             $      658,548                     (4)
             I-B4             $      329,274                     (4)
             I-B5             $      197,564                     (4)
             I-B6             $      460,983                     (4)
            II-B1             $      362,600                     (3)
            II-B2             $      298,600                     (3)
            II-B3             $      213,300                     (3)
            II-B4             $      106,600                     (3)
            II-B5             $       64,000                     (3)
            II-B6             $      149,338                     (3)

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


(1)      REMIC III Regular Interest I-X-1 will not have an Uncertificated
         Principal Balance, but will be entitled to all amounts distributed on
         REMIC I Regular Interests I-1X and I-2X.

(2)      REMIC III Regular Interest I-X-1 will not have a Pass-Through Rate, but
         will be entitled to all amounts distributed on REMIC I Regular
         Interests I-1X and I-2X.

(3)      A variable Pass-Through Rate equal to the weighted average of the
         Pass-Through Rate on REMIC II Regular Interest II-A, weighted on the
         basis of the Uncertificated Principal Balance of such REMIC II Regular
         Interest immediately preceding the related Distribution Date.

(4)      A variable Pass-Through Rate equal to the weighted average of the
         Pass-Through Rates on REMIC I Regular Interests I-1SUB and I-2SUB,
         weighted on the basis of the Uncertificated Principal Balance of each
         such REMIC I Regular Interest immediately preceding the related
         Distribution Date.

         Principal shall be payable to, and shortfalls, losses and prepayments
are allocable to, the REMIC III Regular Interests as such amounts are payable
and allocable to the Corresponding Certificates. Interest shall be payable to
the REMIC III Regular Interests at the Pass-Through Rate for each such REMIC III
Regular Interest on each such REMIC III Regular Interest's Uncertificated
Principal Balance.




                                      -81-
<PAGE>



         (iv) The Classes of the Certificates shall have the following
designations, initial principal amounts and Pass-Through Rates:


         Designation           Initial Principal           Pass-Through Rate
         -----------           -----------------           -----------------
             I-F1               $  79,343,315                    (1)
             I-S1               $  79,343,315(2)                 (3)
             I-F2               $  45,111,998                    (4)
             I-S2               $  45,111,998(2)                 (5)
             I-I1               $ 131,709,507(2)                 (6)
             I-I2               $   2,963,464(2)                 (7)
             I-PO               $   3,302,909                    (8)
            II-A1               $  41,462,000                    (9)
             R-I                $          50                    (10)
             R-II               $          50                    (10)
            R-III               $          50                    (10)
             R-IV               $          50                    (10)
             I-B1               $   1,317,095                  5.0000%
             I-B2               $     987,821                  5.0000%
             I-B3               $     658,548                  5.0000%
             I-B4               $     329,274                    (11)
             I-B5               $     197,564                    (11)
             I-B6               $     460,983                    (11)
            II-B1               $     362,600                    (9)
            II-B2               $     298,600                    (9)
            II-B3               $     213,300                    (9)
            II-B4               $     106,600                    (9)
            II-B5               $      64,000                    (9)
            II-B6               $     149,338                    (9)

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

         (1) The Class I-F1 Certificates bear interest at a pass-through rate
equal to approximately 1.514% per annum for the first Distribution Date, and
thereafter at an adjustable pass-through rate equal to approximately 0.4000% per
annum plus LIBOR, subject to a minimum rate of approximately 0.4000% per annum
and a maximum rate of approximately 8.0000% per annum.

         (2) As described in the definition of Notional Amount herein.

         (3) The Class I-S1 Certificates bear interest at a pass-through rate
equal to approximately 6.486% per annum for the first Distribution Date, and
thereafter at an adjustable pass-through rate equal to approximately 7.6000% per
annum minus LIBOR, subject to a minimum rate of approximately 0.0000% per annum
and a maximum rate of approximately 7.6000% per annum.

         (4) The Class I-F2 Certificates bear interest at a pass-through rate
equal to approximately 1.714% per annum for the first Distribution Date, and
thereafter at an adjustable pass-through rate equal to approximately 0.6000% per
annum plus LIBOR, subject to a minimum rate of approximately 0.6000% per annum
and a maximum rate of approximately 7.5000% per annum.

         (5) The Class I-S2 Certificates bear interest at a pass-through rate
equal to approximately 5.786% per annum for the first Distribution Date, and
thereafter at an adjustable pass-through rate equal to approximately 6.9000%



                                      -82-
<PAGE>



per annum minus LIBOR, subject to a minimum rate of approximately 0.0000% per
annum and a maximum of approximately 6.9000% per annum.

         (6) The Class I-I1 Certificates bear interest at a pass-through rate
equal to approximately 0.784% per annum for the first Distribution Date, and
thereafter at a variable pass-through rate equal to the weighted average of: (A)
the weighted average, for each Group I-1 Mortgage Loan, of the greater of (i)
the excess of (a) the Net Rate of such Group I-1 Mortgage Loan over (b) 8.00%
and (ii) 0.00%, weighted on the basis of the Scheduled Principal Balance of each
such Group I-1 Mortgage Loan, and (B) the weighted average, for each Group I-2
Mortgage Loan, of the greater of (i) the excess of (a) the Net Rate of such
Group I-2 Mortgage Loan over (b) 7.50% and (ii) 0.00%, weighted on the basis of
the Scheduled Principal Balance of each such Group I-2 Mortgage Loan, with
clauses (A) and (B) weighted on the basis of the aggregate Scheduled Principal
Balance of the Group I-1 Mortgage Loans and Group I-2 Mortgage Loans,
respectively. For federal income tax purposes, the Class I-I1 Certificates will
not have a Pass-Through Rate, but will be entitled to 100% of amounts
distributed on REMIC III Regular Interest I-I1.

         (7) The Class I-I2 Certificates bear interest at a pass-through rate
equal to approximately 2.818% per annum for the first Distribution Date, and
thereafter at a variable pass-through rate equal to the excess of (i) the
weighted average of the pass-through rates of the Group I-1 Senior Certificates
and Group I-2 Senior Certificates, weighted in proportion to the results of
subtracting from the aggregate Scheduled Principal Balance of the Group I-1
Mortgage Loans and the Group I-2 Mortgage Loans, respectively, the Current
Principal Amount of the Class I-F1 Certificates and Class I-F2 Certificates,
respectively, and the portion of the Class I-PO Certificate relating to the
Group I-1 Mortgage Loans and Group I-2 Mortgage Loans, respectively, over (ii)
5.0000% per annum. For federal income tax purposes, the Class I-I2 Certificates
bear interest at a per annum rate equal to the excess of (i) the weighted
average of the pass-through rates on REMIC III Regular Interests I-B1, I-B2 and
I-B3, weighted on the basis of the Uncertificated Principal Balance of each such
REMIC III Regular Interest and (ii) 5.00% per annum.

         (8) The Class I-PO Certificates are principal only certificates and are
not entitled to distributions in respect of interest.

         (9) The Class II-A1, Class II-B1, Class II-B2, Class II-B3, Class
II-B4, Class II-B5 and Class II-B6 Certificates will each bear interest at a
variable pass-through rate equal to the weighted average of the Net Rates of the
Group II Mortgage Loans. The pass-through rate with respect to the first
interest accrual period is expected to be approximately 5.543% per annum. For
federal income tax purposes, the Class II-A1, Class II-B1, Class II-B2, Class
II- B3, Class II-B4, Class II-B5 and Class II-B6 Certificates will bear interest
at a per annum rate equal to the weighted average of the pass-through rates on
REMIC III Regular Interests II-A1, II-B1, II-B2, II-B3, II-B4, II-B5 and II-B6,
weighted on the basis of the Uncertificated Principal Balance of each such REMIC
III Regular Interest.

         (10) The Class R-I, Class R-II, Class R-III and Class R-IV Certificates
are not entitled to distributions of interest.

         (11) The Class I-B4, Class I-B5 and Class I-B6 Certificates bear
interest at a pass-through rate equal to approximately 7.818% per annum for the
first Distribution Date, and thereafter at a variable pass-through rate equal to
the weighted average of the pass-through rates of the Group I-1 Senior
Certificates and the Group I-2 Senior Certificates, weighted in proportion to
the results of subtracting from the aggregate Scheduled Principal Balance of the
Group I-1 Mortgage Loans and the Group I-2 Mortgage Loans, respectively, the
Current Principal Amount of the Class I-F1 Certificates and the Class I-F2
Certificates, respectively, and the portion of the Class I-PO Certificate
relating to each of the Group I-1 Mortgage Loans and Group I-2 Mortgage Loans,
respectively. For federal income tax purposes, the Class I-B4, Class I-B5 and
Class I-B6 Certificates will bear interest at a per annum rate equal to the
weighted average of the pass-through rates on REMIC III Regular Interests I-B4,
I-B5 and I-B6, weighted on the basis of the Uncertificated Principal Balance of
each such REMIC III Regular Interest.

         (d) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date for
the Mortgage Loan with the latest maturity date in the Trust Fund has been
designated as the "latest possible maturity date" for the



                                      -83-
<PAGE>



REMIC I Regular Interests, REMIC II Regular Interests, REMIC III Regular
Interests and the Certificates.

         (e) With respect to each Distribution Date, each Class of Certificates
shall accrue interest during the related Interest Accrual Period. With respect
to each Distribution Date and each such Class of Certificates, interest shall be
calculated, on the basis of a 360-day year comprised of twelve 30-day months,
based upon the respective Pass-Through Rate set forth, or determined as
provided, above and the Current Principal Amount (or Notional Amount in the case
of the Interest Only Certificates) of such Class applicable to such Distribution
Date.

         (f) The Certificates shall be substantially in the forms set forth in
Exhibits A-1, A-2 and A-3. On original issuance, the Trustee shall execute,
authenticate and deliver them at the direction of the Seller. Pending the
preparation of definitive Certificates of any Class, the Trustee may execute,
authenticate and shall deliver temporary Certificates that are printed,
lithographed or typewritten, in authorized denominations for Certificates of
such Class, substantially of the tenor of the definitive Certificates in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers or authorized signatories
executing such Certificates may determine, as evidenced by their execution of
such Certificates. If temporary Certificates are issued, the Seller will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office designated by the Trustee for such purpose, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Trustee shall execute, authenticate and deliver in
exchange therefor a like aggregate principal amount, in authorized denominations
for such Class, of definitive Certificates of the same Class. Until so
exchanged, such temporary Certificates shall in all respects be entitled to the
same benefits as definitive Certificates.

         (g) Each Class of Book-Entry Certificates will be registered as a
single Certificate of such Class held by a nominee of the Depository or the DTC
Custodian, and beneficial interests will be held by investors through the
book-entry facilities of the Depository in minimum denominations of (i) in the
case of the Senior Certificates (other than the Residual Certificates), $1,000
and in each case increments of $1.00 in excess thereof, and (ii) in the case of
the Offered Subordinate Certificates, $25,000 and increments of $1.00 in excess
thereof, except that one Certificate of each such Class may be issued in a
different amount so that the sum of the denominations of all outstanding
Certificates of such Class shall equal the Current Principal Amount of such
Class on the Closing Date. On the Closing Date, the Trustee shall execute,
authenticate and deliver Physical Certificates all in an aggregate principal
amount that shall equal the Current Principal Amount of such Class on the
Closing Date. The Private Certificates shall be issued in certificated fully-
registered form in minimum dollar denominations of $25,000 and integral
multiples of $1.00 in excess thereof, except that one Private Certificate of
each Class may be issued in a different amount so that the sum of the
denominations of all outstanding Private Certificates of such Class shall equal
the Current Principal Amount of such Class on the Closing Date. The Residual
Certificates shall each be issued in certificated fully-registered form, each,
in the denomination of $50. Each Class of Global Certificates, if any, shall be
issued in fully registered form in minimum dollar denominations of $50,000 and
integral multiples of $1.00 in excess thereof, except that one Certificate of
each Class may be in a different denomination so that the sum of the
denominations



                                      -84-
<PAGE>


of all outstanding Certificates of such Class shall equal the Current Principal
Amount of such Class on the Closing Date. On the Closing Date, the Trustee shall
execute, authenticate and deliver (i) in the case of each Class of Offered
Certificates, the Certificate in the entire Current Principal Amount of the
respective Class and (ii) in the case of each Class of Private Certificates,
Individual Certificates all in an aggregate principal amount that shall equal
the Current Principal Amount of each such respective Class on the Closing Date.
The Certificates referred to in clause (i) and if at any time there are to be
Global Certificates, the Global Certificates shall be delivered by the Seller to
the Depository or pursuant to the Depository's instructions, shall be delivered
by the Seller on behalf of the Depository to and deposited with the DTC
Custodian. The Trustee shall execute the Certificates by facsimile or manual
signature and authenticate them by manual signature on behalf of the Trustee by
one or more authorized signatories, each of whom shall be Responsible Officers
of the Trustee or its agent. A Certificate bearing the manual and facsimile
signatures of individuals who were the authorized signatories of the Trustee or
its agent at the time of issuance shall bind the Trustee, notwithstanding that
such individuals or any of them have ceased to hold such positions prior to the
delivery of such Certificate.

         (h) No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such Certificate
the manually executed authentication of the Trustee or its agent, and such
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly executed and delivered hereunder.
All Certificates issued on the Closing Date shall be dated the Closing Date. All
Certificates issued thereafter shall be dated the date of their authentication.

         (i) The Closing Date is hereby designated as the "startup" day of each
REMIC within the meaning of Section 860G(a)(9) of the Code.

         (j) For federal income tax purposes, each REMIC shall have a tax year
that is a calendar year and shall report income on an accrual basis.

         (k) The Trustee on behalf of the Trust shall cause each REMIC to timely
elect to be treated as a REMIC under Section 860D of the Code, as directed by
the Securities Administrator. Any inconsistencies or ambiguities in this
Agreement or in the administration of any Trust established hereby shall be
resolved in a manner that preserves the validity of such elections.

         (l) The following legend shall be placed on the Residual Certificates,
whether upon original issuance or upon issuance of any other Certificate of any
such Class in exchange therefor or upon transfer thereof:

         THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY
         BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER
         RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE
         EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED,
         AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
         AMENDED, UNLESS THE PROPOSED TRANSFEREE PROVIDES THE TRUSTEE,
         THE MASTER SERVICER AND THE SECURITIES ADMINISTRATOR WITH AN
         OPINION OF COUNSEL THAT




                                      -85-
<PAGE>


         THE PURCHASE OF CERTIFICATES ON BEHALF OF SUCH WILL NOT RESULT
         IN OR CONSTITUTE A NONEXEMPT PROHIBITED TRANSACTION, IS
         PERMISSIBLE UNDER APPLICABLE LAW AND WILL NOT GIVE RISE TO ANY
         ADDITIONAL FIDUCIARY OBLIGATIONS ON THE PART OF THE SELLER,
         THE MASTER SERVICER, ANY SERVICER, ANY SUB-MASTER SERVICER,
         THE SECURITIES ADMINISTRATOR OR THE TRUSTEE.

The following legend shall be placed upon the Private Certificates, whether upon
original issuance or upon issuance of any other Certificate of any such Class in
exchange therefor or upon transfer thereof:

         THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, AND SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE PROPOSED TRANSFER AND
HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND OPERATION OF THE
TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH IS
NOT COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION AND
(II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY OBLIGATIONS ON THE PART OF
THE SELLER, THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER OR THE TRUSTEE AND
(III) IS PERMISSIBLE UNDER APPLICABLE LAW, WHICH WILL BE DEEMED REPRESENTED BY
AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE OR UNLESS THE
OPINION SPECIFIED IN SECTION 5.07 OF THE AGREEMENT IS PROVIDED.

         Section 5.02 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES. (a)
The Trustee shall maintain at its Corporate Trust Office 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) Subject to Subsection 5.01(a) and, in the case of any Global
Certificate or Physical Certificate upon the satisfaction of the conditions set
forth below, upon surrender for registration of transfer of any Certificate at
any office or agency of the Trustee maintained for such purpose, the Trustee
shall execute, authenticate and deliver, in the name of the designated
transferee or transferees, a new Certificate of a like Class and aggregate
Fractional Undivided Interest, but bearing a different number.

         (c) By acceptance of an Individual Certificate, whether upon original
issuance or subsequent transfer, each holder of such a Certificate acknowledges
the restrictions on the transfer of such Certificate set forth in the Securities
Legend and agrees that it will transfer such a Certificate only as provided
herein. In addition to the provisions of Subsection 5.02(h), the following
restrictions shall apply with respect to the transfer and registration of
transfer of an Individual Certificate to a transferee that takes delivery in the
form of an Individual Certificate:





                                      -86-
<PAGE>


                  (i) The Trustee shall register the transfer of an Individual
         Certificate if the requested transfer is being made to a transferee who
         has provided the Trustee with a Rule 144A Certificate or comparable
         evidence as to its QIB status.

                  (ii) The Trustee shall register the transfer of any Individual
         Certificate if (x) the transferor has advised the Trustee in writing
         that the Certificate is being transferred to an Institutional
         Accredited Investor; and (y) prior to the transfer the transferee
         furnishes to the Trustee an Investment Letter (and the Trustee shall be
         fully protected in so doing), provided that, if based upon an Opinion
         of Counsel addressed to the Trustee to the effect that the delivery of
         (x) and (y) above are not sufficient to confirm that the proposed
         transfer is being made pursuant to an exemption from, or in a
         transaction not subject to, the registration requirements of the
         Securities Act and other applicable laws, the Trustee shall as a
         condition of the registration of any such transfer require the
         transferor to furnish such other certifications, legal opinions or
         other information prior to registering the transfer of an Individual
         Certificate as shall be set forth in such Opinion of Counsel.

         (d) Subject to Subsection 5.02(h), so long as a Global Certificate of
such Class is outstanding and is held by or on behalf of the Depository,
transfers of beneficial interests in such Global Certificate, or transfers by
holders of Individual Certificates of such Class to transferees that take
delivery in the form of beneficial interests in the Global Certificate, may be
made only in accordance with this Subsection 5.02(d) and in accordance with the
rules of the Depository:

                  (i) In the case of a beneficial interest in the Global
         Certificate being transferred to an Institutional Accredited Investor,
         such transferee shall be required to take delivery in the form of an
         Individual Certificate or Certificates and the Trustee shall register
         such transfer only upon compliance with the provisions of Subsection
         5.02(c)(ii).

                  (ii) In the case of a beneficial interest in a Class of Global
         Certificates being transferred to a transferee that takes delivery in
         the form of an Individual Certificate or Certificates of such Class,
         except as set forth in clause (i) above, the Trustee shall register
         such transfer only upon compliance with the provisions of Subsection
         5.02(c)(i).

                  (iii) In the case of an Individual Certificate of a Class
         being transferred to a transferee that takes delivery in the form of a
         beneficial interest in a Global Certificate of such Class, the Trustee
         shall register such transfer if the transferee has provided the Trustee
         with a Rule 144A Certificate or comparable evidence as to its QIB
         status.

                  (iv) No restrictions shall apply with respect to the transfer
         or registration of transfer of a beneficial interest in the Global
         Certificate of a Class to a transferee that takes delivery in the form
         of a beneficial interest in the Global Certificate of such Class;
         provided that each such transferee shall be deemed to have made such
         representations and warranties contained in the Rule 144A Certificate
         as are sufficient to establish that it is a QIB.

         (e) Subject to Subsection 5.02(h), an exchange of a beneficial interest
in a Global Certificate of a Class for an Individual Certificate or Certificates
of such Class, an exchange of an




                                      -87-
<PAGE>


Individual Certificate or Certificates of a Class for a beneficial interest in
the Global Certificate of such Class and an exchange of an Individual
Certificate or Certificates of a Class for another Individual Certificate or
Certificates of such Class (in each case, whether or not such exchange is made
in anticipation of subsequent transfer, and, in the case of the Global
Certificate of such Class, so long as such Certificate is outstanding and is
held by or on behalf of the Depository) may be made only in accordance with this
Subsection 5.02(e) and in accordance with the rules of the Depository:

                  (i) A holder of a beneficial interest in a Global Certificate
         of a Class may at any time exchange such beneficial interest for an
         Individual Certificate or Certificates of such Class.

                  (ii) A holder of an Individual Certificate or Certificates of
         a Class may exchange such Certificate or Certificates for a beneficial
         interest in the Global Certificate of such Class if such holder
         furnishes to the Trustee a Rule 144A Certificate or comparable evidence
         as to its QIB status.

                  (iii) A holder of an Individual Certificate of a Class may
         exchange such Certificate for an equal aggregate principal amount of
         Individual Certificates of such Class in different authorized
         denominations without any certification.

         (f) (i) Upon acceptance for exchange or transfer of an Individual
Certificate of a Class for a beneficial interest in a Global Certificate of such
Class as provided herein, the Trustee shall cancel such Individual Certificate
and shall (or shall request the Depository to) endorse on the schedule affixed
to the applicable Global Certificate (or on a continuation of such schedule
affixed to the Global Certificate and made a part thereof) or otherwise make in
its books and records an appropriate notation evidencing the date of such
exchange or transfer and an increase in the certificate balance of the Global
Certificate equal to the certificate balance of such Individual Certificate
exchanged or transferred therefor.

                  (ii) Upon acceptance for exchange or transfer of a beneficial
         interest in a Global Certificate of a Class for an Individual
         Certificate of such Class as provided herein, the Trustee shall (or
         shall request the Depository to) endorse on the schedule affixed to
         such Global Certificate (or on a continuation of such schedule affixed
         to such Global Certificate and made a part thereof) or otherwise make
         in its books and records an appropriate notation evidencing the date of
         such exchange or transfer and a decrease in the certificate balance of
         such Global Certificate equal to the certificate balance of such
         Individual Certificate issued in exchange therefor or upon transfer
         thereof.

         (g) The Securities Legend shall be placed on any Individual Certificate
issued in exchange for or upon transfer of another Individual Certificate or of
a beneficial interest in a Global Certificate.

         (h) Subject to the restrictions on transfer and exchange set forth in
this Section 5.02, the holder of any Individual Certificate may transfer or
exchange the same in whole or in part (in an initial certificate balance equal
to the minimum authorized denomination set forth in Section 5.01(g)




                                      -88-
<PAGE>

above or any integral multiple of $1.00 in excess thereof) by surrendering such
Certificate at the designated office, or at the office of any transfer agent,
together with an executed instrument of assignment and transfer satisfactory in
form and substance to the Trustee in the case of transfer and a written request
for exchange in the case of exchange. The holder of a beneficial interest in a
Global Certificate may, subject to the rules and procedures of the Depository,
cause the Depository (or its nominee) to notify the Trustee in writing of a
request for transfer or exchange of such beneficial interest for an Individual
Certificate or Certificates. Following a proper request for transfer or
exchange, the Trustee shall, within five Business Days of surrender at the
designated office, execute, authenticate and deliver , to the transferee (in the
case of transfer) or holder (in the case of exchange) or send by first class
mail at the risk of the transferee (in the case of transfer) or holder (in the
case of exchange) to such address as the transferee or holder, as applicable,
may request, an Individual Certificate or Certificates, as the case may require,
for a like aggregate Fractional Undivided Interest and in such authorized
denomination or denominations as may be requested. The presentation for transfer
or exchange of any Individual Certificate shall not be valid unless made at the
designated office by the registered holder in person, or by a duly authorized
attorney-in-fact.

         (i) At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized denominations of a like Class and
aggregate Fractional Undivided Interest, upon surrender of the Certificates to
be exchanged at the designated office; provided, however, that no Certificate
may be exchanged for new Certificates unless the original Fractional Undivided
Interest represented by each such new Certificate (i) is at least equal to the
minimum authorized denomination or (ii) is acceptable to the Seller as indicated
to the Trustee in writing. 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.

         (j) If the Trustee so requires, every Certificate presented or
surrendered for transfer or exchange shall be duly endorsed by, or be
accompanied by a written instrument of transfer, with a signature guarantee, in
form satisfactory to the Trustee, duly executed by the holder thereof or his or
her attorney duly authorized in writing.

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

         (l) The Trustee shall cancel all Certificates surrendered for transfer
or exchange but shall retain such Certificates in accordance with its customary
procedures, and thereafter may destroy such Certificates.

         Section 5.03 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. (a) If
(i) any mutilated Certificate is surrendered to the Trustee, or 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 it may require to save it harmless, and (iii) the Trustee has not
received notice that such Certificate has been acquired by a third Person, 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
like tenor and Fractional Undivided Interest but in each case bearing a
different




                                      -89-
<PAGE>


number. The mutilated, destroyed, lost or stolen Certificate shall thereupon be
canceled of record by the Trustee and shall be of no further effect and evidence
no rights.

         (b) Upon the issuance of any new Certificate under this Section 5.03,
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 duplicate Certificate issued pursuant to this Section 5.03 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. Prior to due presentation of a
Certificate for registration of transfer, the Seller, the Trustee and any agent
of the Seller or the Trustee 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 6.01 and for all other purposes whatsoever.
Neither the Seller, the Trustee nor any agent of the Seller or the Trustee shall
be affected by notice to the contrary.

         Section 5.05 TRANSFER RESTRICTIONS ON RESIDUAL CERTIFICATES. (a)
Residual Certificates, or interests therein, may not be transferred without the
prior express written consent of the Tax Matters Person and the Seller. As a
prerequisite to such consent, the proposed transferee must provide the Tax
Matters Person, the Seller and the Trustee with an affidavit that the proposed
transferee is a Permitted Transferee (and an affidavit that it is a U.S. Person)
as provided in Subsection 5.05(b).

         (b) No transfer, sale or other disposition of a Residual Certificate
(including a beneficial interest therein) may be made unless, prior to the
transfer, sale or other disposition of a Residual Certificate, the proposed
transferee (including the initial purchasers thereof) delivers to the Tax
Matters Person, the Trustee and the Seller an affidavit in the form attached
hereto as Exhibit E stating, among other things, that as of the date of such
transfer (i) such transferee is a Permitted Transferee and that (ii) such
transferee is not acquiring such Residual Certificate for the account of any
person who is not a Permitted Transferee. The Tax Matters Person shall not
consent to a transfer of a Residual Certificate if it has actual knowledge that
any statement made in the affidavit issued pursuant to the preceding sentence is
not true. Notwithstanding any transfer, sale or other disposition of a Residual
Certificate to any Person who is not a Permitted Transferee, such transfer, sale
or other disposition shall be deemed to be of no legal force or effect
whatsoever and such Person shall not be deemed to be a Holder of a Residual
Certificate for any purpose hereunder, including, but not limited to, the
receipt of distributions thereon. If any purported transfer shall be in
violation of the provisions of this Subsection 5.05(b), then the prior Holder
thereof shall, upon discovery that the transfer of such Residual Certificate was
not in fact permitted by this Subsection 5.05(b), be restored to all rights as a
Holder thereof retroactive to the date of the purported transfer. None of the
Trustee, the Tax Matters Person or the Seller shall be under any liability to
any Person for any registration or transfer of a Residual Certificate that is
not permitted by this Subsection 5.05(b) or for making payments due on such
Residual Certificate to the purported Holder thereof or taking any other action
with respect to such purported Holder under the provisions of this Agreement so
long as the written affidavit referred to above was received with respect to
such transfer, and the Tax Matters Person, the Trustee and the Seller, as
applicable, had no knowledge that it was untrue. The prior Holder shall be
entitled to recover from any purported Holder of a




                                      -90-
<PAGE>


Residual Certificate that was in fact not a permitted transferee under this
Subsection 5.05(b) at the time it became a Holder all payments made on such
Residual Certificate. Each Holder of a Residual Certificate, by acceptance
thereof, shall be deemed for all purposes to have consented to the provisions of
this Subsection 5.05(b) and to any amendment of this Agreement deemed necessary
(whether as a result of new legislation or otherwise) by counsel of the Tax
Matters Person or the Seller to ensure that the Residual Certificates are not
transferred to any Person who is not a Permitted Transferee and that any
transfer of such Residual Certificates will not cause the imposition of a tax
upon the Trust or cause any REMIC to fail to qualify as a REMIC.

         (c) The Residual Certificates (including a beneficial interest therein)
may not be purchased by or transferred to any person who is not a United States
Person.

         (d) By accepting a Residual Certificate, the purchaser thereof agrees
to be a Tax Matters Person, and appoints the Securities Administrator to act as
its agent with respect to all matters concerning the tax obligations of the
Trust.

         Section 5.06 RESTRICTIONS ON TRANSFERABILITY OF CERTIFICATES. (a) No
offer, sale, transfer or other disposition (including pledge) of any Certificate
shall be made by any Holder thereof unless registered under the Securities Act,
or an exemption from the registration requirements of the Securities Act and any
applicable state securities or "Blue Sky" laws is available and the prospective
transferee (other than the Seller) of such Certificate signs and delivers to the
Trustee an Investment Letter, if the transferee is an Institutional Accredited
Investor, in the form set forth as Exhibit F-l hereto, or a Rule 144A
Certificate, if the transferee is a QIB, in the form set forth as Exhibit F-2
hereto. Notwithstanding the provisions of the immediately preceding sentence, no
restrictions shall apply with respect to the transfer or registration of
transfer of a beneficial interest in any Certificate that is a Global
Certificate of a Class to a transferee that takes delivery in the form of a
beneficial interest in the Global Certificate of such Class provided that each
such transferee shall be deemed to have made such representations and warranties
contained in the Rule 144A Certificate as are sufficient to establish that it is
a QIB. In the case of a proposed transfer of any Certificate to a transferee
other than a QIB, the Trustee may require an Opinion of Counsel addressed to the
Trustee that such transaction is exempt from the registration requirements of
the Securities Act. The cost of such opinion shall not be an expense of the
Trustee or the Trust Fund.

         (b) The Private Certificates shall each bear a Securities Legend.

         Section 5.07 ERISA RESTRICTIONS. (a) Subject to the provisions of
subsections (b) and (c), no Residual Certificates or Subordinate Certificates
may be acquired directly or indirectly by, or on behalf of, an employee benefit
plan or other retirement arrangement which is subject to Title I of ERISA and
Section 4975 of the Code, unless the proposed transferee provides either (i) the
Trustee with an Opinion of Counsel addressed to the Trustee, the Master Servicer
and the Securities Administrator (upon which they may rely) which is
satisfactory to the Trustee, which opinion will not be at the expense of the
Trustee, the Master Servicer or the Securities Administrator, that the purchase
of such Certificates by or on behalf of such Plan is permissible under
applicable law, will not constitute or result in a nonexempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Trustee, the Master Servicer or the Securities Administrator to any obligation
in addition to those undertaken in the Agreement or (ii) (a) in the case of the
Class I-B1,




                                      -91-
<PAGE>


Class I-B2, Class I-B3, Class I-B4, Class I-B5, Class II-B1, Class II-B2, Class
II-B3, Class II-B4 and Class II-B5 Certificates, a representation or
certification to the Trustee (upon which the Trustee is authorized to rely) to
the effect that either (i) it is not a Plan or investing with "Plan Assets",
(ii) (1) it is an insurance company, (2) the source of funds used to acquire or
hold the certificate or interest therein is an "insurance company general
account," as such term is defined in Prohibited Transaction Class Exemption
("PTCE") 95-60, and (3) the conditions in Sections I and III of PTCE 95-60 have
been satisfied and (b) in the case of the Class I-B6 Certificates and Class
II-B6 Certificates, a representation or certification to the Trustee (upon which
the Trustee is authorized to rely) to the effect that the proposed transfer and
holding of such a Certificate and the servicing, management and operation of the
Trust: (I) will not result in a non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code, (II) will not subject the Seller, the
Securities Administrator, the Master Servicer or the Trustee to any obligation
in addition to those undertaken in the Agreement and (III) is permissible under
applicable law.

         (b) Any Person acquiring an interest in a Global Certificate which is a
Class I-B6 Certificate or Class II-B6 Certificate, by acquisition of such
Certificate, shall be deemed to have represented to the Trustee that, either:
(i) it is not acquiring an interest in such Certificate directly or indirectly
by, or on behalf of, an employee benefit plan or other retirement arrangement
which is subject to Title I of ERISA and Section 4975 of the Code, or (ii) the
transfer and holding of an interest in such Certificate to that Person and the
subsequent servicing, management and operation of the Trust and its assets: (I)
will not result in any non-exempt prohibited transaction and (II) will not
subject the Seller, the Securities Administrator, the Master Servicer or the
Trustee to any obligation in addition to those undertaken in the Agreement and
(III) is permissible under applicable law.

         (c) Each beneficial owner of a Class I-B1, Class I-B2, Class I-B3,
Class I-B4, Class I-B5, Class II-B1, Class II-B2, Class II-B3, Class II-B4 or
Class II-B5 Certificate or any interest therein shall be deemed to have
represented, by virtue of its acquisition or holding of that certificate or
interest therein, that either (i) it is not a Plan or investing with "Plan
Assets", (ii) (1) it is an insurance company, (2) the source of funds used to
acquire or hold the certificate or interest therein is an "insurance company
general account," as such term is defined in Prohibited Transaction Class
Exemption ("PTCE") 95-60, and (3) the conditions in Sections I and III of PTCE
95-60 have been satisfied.

         (d) Neither the Trustee, the Master Servicer nor the Securities
Administrator will be required to monitor, determine or inquire as to compliance
with the transfer restrictions with respect to the Global Certificates. Any
attempted or purported transfer of any Certificate in violation of the
provisions of Subsections (a) or (b) above shall be void ab initio and such
Certificate shall be considered to have been held continuously by the prior
permitted Certificateholder. Any transferor of any Certificate in violation of
such provisions, shall indemnify and hold harmless the Trustee, the Securities
Administrator and the Master Servicer from and against any and all liabilities,
claims, costs or expenses incurred by the Trustee, the Securities Administrator
or the Master Servicer as a result of such attempted or purported transfer. The
Trustee shall have no liability for transfer of any such Global Certificates in
or through book-entry facilities of any Depository or between or among
Depository Participants or Certificate Owners made in violation of the transfer
restrictions set forth herein.




                                      -92-
<PAGE>


         Section 5.08 RULE 144A INFORMATION. For so long as any Certificates are
outstanding and are "restricted securities" within the meaning of Rule 144(a)(3)
of the Securities Act, (1) the Seller 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 Seller 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 available for resales of such
Certificates conducted in accordance with Rule 144A.




                                      -93-
<PAGE>



                                   ARTICLE VI
                         Payments to Certificateholders

         Section 6.01 DISTRIBUTIONS ON THE CERTIFICATES.

         (a) Distributions on the Certificates.

                  (i) Interest and principal (as applicable) on the Group I
         Certificates will be distributed monthly on each Distribution Date,
         commencing in July 2003, in an amount equal to the Group I Available
         Funds on deposit in the Distribution Account for such Distribution
         Date. In addition, on the first Distribution Date, the $50 deposited by
         the Seller into the Distribution Account on the Closing Date for the
         Class R-I Certificate (the "Class R-I Deposit") will be distributed to
         the Class R-I Certificate, in reduction of its Current Principal
         Amount, until its Current Principal Amount has been reduced to zero.

                  (A) On each Distribution Date, the Group 1 Available Funds
                  (and solely in the case of the Class R-I Certificate, the
                  Class R-I Deposit) will be distributed to the Group I Senior
                  Certificates as follows:

                           FIRST, (i) from the Group I-1 Available Funds to the
                           Group I-1 Senior Certificates, on a pro rata basis,
                           the Accrued Certificate Interest on such Classes for
                           such Distribution Date and (ii) from the Group I-2
                           Available Funds to the Group I-2 Senior Certificates
                           (other than the Class R-I Certificate), on a pro rata
                           basis, the Accrued Certificate Interest on such
                           Classes for such Distribution Date. As described
                           below, Accrued Certificate Interest on the Group I-1
                           Senior Certificates and Group I-2 Senior Certificates
                           is subject to reduction in the event of certain Net
                           Interest Shortfalls allocable thereto;

                           SECOND, (i) from the Group I-1 Available Funds to the
                           Group I-1 Senior Certificates, on a pro rata basis,
                           any Accrued Certificate Interest thereon remaining
                           undistributed from previous Distribution Dates, to
                           the extent of remaining Group I-1 Available Funds and
                           (ii) from the Group I-2 Available Funds to the Group
                           I-2 Senior Certificates (other than the Class R-I
                           Certificate), on a pro rata basis, any Accrued
                           Certificate Interest thereon remaining undistributed
                           from previous Distribution Dates, to the extent of
                           remaining Group I-2 Available Funds;

                           THIRD, subject to Clause (C) below, from the Group I
                           Available Funds to the Class I-I1 Certificates and
                           Class I-I2 Certificates, on a pro rata basis, the
                           Accrued Certificate Interest on such Classes for such
                           Distribution Date. As described below, Accrued
                           Certificate Interest on the Class I-I1 Certificates
                           and Class I-I2 Certificates is subject to reduction
                           in the event of certain Net Interest Shortfalls
                           allocable thereto;




                                      -94-
<PAGE>



                           FOURTH, subject to Clause (D), from the Group I
                           Available Funds to the Class I-I1 Certificates and
                           Class I-I2 Certificates, on a pro rata basis, any
                           Accrued Certificate Interest thereon remaining
                           undistributed from previous Distribution Dates, to
                           the extent of remaining Group I Available Funds;

                           FIFTH, (i) from the Group I-1 Available Funds to the
                           Class I-F1 Certificates, in reduction of the Current
                           Principal Amount thereof, the Group I-1 Senior
                           Optimal Principal Amount for such Distribution Date
                           to the extent of remaining Group I-1 Available Funds,
                           until the Current Principal Amount of such Class has
                           been reduced to zero, (ii) from the Group I-2
                           Available Funds to the Class I-F2 Certificates, in
                           reduction of the Current Principal Amount thereof,
                           the Group I-2 Senior Optimal Principal Amount for
                           such Distribution Date to the extent of remaining
                           Group I-2 Available Funds and (iii) from the Class
                           R-I Deposit to the Class R-I Certificate, in each
                           case, until the Current Principal Amount of each such
                           Class has been reduced to zero;

                           SIXTH, from the Group I Available Funds to the Class
                           I-PO Certificates, in reduction of the Current
                           Principal Amount thereof, the Class I-PO Certificate
                           Principal Distribution Amount for such Distribution
                           Date to the extent of remaining Group I Available
                           Funds, until the Current Principal Amount of such
                           Class has been reduced to zero; and

                           SEVENTH, from the Group I Available Funds to the
                           Class I-PO Certificates, the Class I-PO Certificate
                           Deferred Amount, provided, that (i) on any
                           Distribution Date, distributions pursuant to this
                           priority SEVENTH shall not exceed the excess, if any,
                           of (x) Group I Available Funds remaining after giving
                           effect to distributions pursuant to priority FIRST
                           through SIXTH above over (y) the sum of the amount of
                           Accrued Certificate Interest for such Distribution
                           Date and Accrued Certificate Interest remaining
                           undistributed from previous Distribution Dates on all
                           classes of Group I Subordinate Certificates then
                           outstanding, (ii) such distributions shall not reduce
                           the Current Principal Amount of the Class I-PO
                           Certificates and (iii) no distribution will be made
                           in respect of the Class I-PO Certificate Deferred
                           Amount on or after the Group I Cross-Over Date.

                  (B) Except as provided in (E) and (F) below, on each
                  Distribution Date prior to the Group I Cross-Over Date, an
                  amount equal to any remaining Group I Available Funds after
                  the distributions in clause (A) above will be distributed
                  sequentially, in the following order, to the Class I-B1, Class
                  I-B2, Class I-B3, Class I-B4, Class I-B5 and Class I-B6
                  Certificates, in each case up to an amount equal to and in the
                  following order: (1) the Accrued Certificate Interest thereon
                  for such Distribution Date, (2) any Accrued Certificate
                  Interest thereon remaining undistributed from previous
                  Distribution Dates and (3) such Class's Allocable Share for
                  such Distribution Date, in each case, to the extent of the
                  remaining Group I Available Funds.




                                      -95-
<PAGE>



                  (C) Amounts distributed in respect of the Class I-I1
                  Certificates pursuant to clauses THIRD and FOURTH of clause
                  (A) above shall be deemed distributed (1) from the Group I-1
                  Available Funds to the extent of the amount that would be
                  determined under the definition of Accrued Certificate
                  Interest in respect of such Class if the Notional Balance
                  thereof were equal to the aggregate Scheduled Principal
                  Balance of the Group I-1 Mortgage Loans and the Pass-Through
                  Rate thereof were equal to the weighted average, for each
                  Group I-1 Mortgage Loan, of the greater of (x) the excess of
                  (a) the Net Rate of such Group I-1 Mortgage Loan over (b)
                  8.00% and (y) zero, and (ii) from the Group I-2 Available
                  Funds to the extent of the amount that would be determined
                  under the definition of Accrued Certificate Interest in
                  respect of such Class if the Notional Balance thereof were
                  equal to the aggregate Scheduled Principal Balance of the
                  Group I-2 Mortgage Loans and the Pass-Through Rate thereof
                  were equal to the weighted average, for each Group I-2
                  Mortgage Loan, of the greater of (x) the excess of (a) the Net
                  Rate of such Group I-2 Mortgage Loan over (b) 7.50% and (y)
                  zero.

                  (D) Amounts distributed in respect of the Class I-I2
                  Certificates pursuant to clauses THIRD and FOURTH of clause
                  (A) shall be deemed distributed (i) from the Group I-1
                  Available Funds to the extent of the amount that would be
                  determined under the definition of Accrued Certificate
                  Interest in respect of such Class if the Notional Balance
                  thereof were equal to the product of (x) the Subordinate
                  Percentage relating to Loan Group I-1 and (y) the aggregate
                  Scheduled Principal Balance of the Group I-1 Mortgage Loans as
                  of the beginning of the related Due Period and (z) a fraction,
                  the numerator of which is the aggregate current principal
                  amount of the Group I Offered Subordinate Certificates and the
                  denominator of which is the aggregate current principal amount
                  the Group I Subordinate Certificates, and the Pass-Through
                  Rate thereof were equal to 3.0%, and (ii) from the Group I-2
                  Available Funds to the extent of the amount that would be
                  determined under the definition of Accrued Certificate
                  Interest in respect of such Class if the Notional Balance
                  thereof were equal to the product of (x) the Subordinate
                  Percentage relating to Loan Group I-2 and (y) the aggregate
                  Scheduled Principal Balance of the Group I-2 Mortgage Loans as
                  of the beginning of the related Due Period and (z) a fraction,
                  the numerator of which is the aggregate current principal
                  amount of the Group I Offered Subordinate Certificates and the
                  denominator of which is the aggregate current principal amount
                  the Group I Subordinate Certificates, and the Pass-Through
                  Rate thereof were equal to 2.5%.

                  (E) On each Distribution Date prior to the Group I Cross-Over
                  Date, but after the reduction of the Current Principal Amount
                  of either of the Class I-F1 Certificates or Class I-F2
                  Certificates to zero, the remaining Class of Group I Senior
                  Certificates (other than the Interest Only Certificates and
                  the Principal Only Certificates) will be entitled to receive
                  in reduction of its Current Principal Amount, in addition to
                  any Principal Prepayments related to such remaining Group I
                  Senior Certificates' respective Loan Group allocated to such
                  Group I Senior Certificate, 100% of the Non-PO Percentage of
                  Principal Prepayments on any Mortgage Loan in the Loan



                                      -96-
<PAGE>


                  Group relating to the fully repaid Class of Group I Senior
                  Certificates; provided, however, that if (A) the weighted
                  average of the Subordinate Percentages of the Group I
                  Subordinate Certificates on such Distribution Date equals or
                  exceeds two times the initial weighted average of the
                  Subordinate Percentages of the Group I Subordinate
                  Certificates and (B) the aggregate Scheduled Principal Balance
                  of the Group I Mortgage Loans delinquent 60 days or more
                  (including for this purpose any such Group I Mortgage Loans in
                  foreclosure and Group I Mortgage Loans with respect to which
                  the related Mortgaged Property has been acquired by the
                  Trust), averaged over the last six months, as a percentage of
                  the sum of the aggregate Current Principal Amount of the Group
                  I Subordinate Certificates does not exceed 100%, then the
                  additional allocation of Principal Prepayments to the Group I
                  Senior Certificates in accordance with this clause (E) will
                  not be made and 100% of the Non-PO Percentage of the Principal
                  Prepayments on any Mortgage Loan in the Loan Group relating to
                  the fully repaid Class of Group I Senior Certificates will be
                  allocated to the Group I Subordinate Certificates.

                  (F) If on any Distribution Date on which the aggregate Current
                  Principal Amount of any Class or Classes of Group I Senior
                  Certificates (other than the Interest Only Certificates and
                  Principal Only Certificates) would be greater than the
                  aggregate Scheduled Principal Balance of the Mortgage Loans in
                  the related Loan Group (other than the PO Percentage of the
                  Discount Mortgage Loans) and any Group I Subordinate
                  Certificates are still outstanding, in each case after giving
                  effect to distributions to be made on such Distribution Date,
                  (A) 100% of amounts otherwise allocable to the Group I
                  Subordinate Certificates in respect of principal will be
                  distributed to such Class or Classes of Group I Senior
                  Certificates in reduction of the Current Principal Amounts
                  thereof, until the aggregate Current Principal Amount of such
                  Class or Classes of Group I Senior Certificates is an amount
                  equal to the aggregate Scheduled Principal Balance of the
                  Mortgage Loans in its related Loan Group (other than the PO
                  Percentage of the Discount Mortgage Loans), and (B) the
                  Accrued Certificate Interest otherwise allocable to the Group
                  I Subordinate Certificates on such Distribution Date will be
                  reduced, if necessary, and distributed to such Class or
                  Classes of Senior Certificates in an amount equal to the
                  Accrued Certificate Interest for such Distribution Date on the
                  excess of (x) the aggregate Current Principal Balance of such
                  Class or Classes of Group I Senior Certificates over (y) the
                  aggregate Scheduled Principal Balance of the Mortgage Loans in
                  the related Loan Group (other than the PO Percentage of the
                  Discount Mortgage Loans). Any such reduction in the Accrued
                  Certificate Interest on the Group I Subordinate Certificates
                  will be allocated in reverse order of the Group I Subordinate
                  Certificates numerical designations, commencing with the Class
                  I-B6 Certificates.

                  (G) If, after distributions have been made pursuant to
                  priorities FIRST, SECOND, THIRD AND FOURTH of clauses (A)
                  above, on any Distribution Date, the remaining Group I
                  Available Funds are less than the sum of the Group I-1 Senior
                  Optimal Principal Amount, the Group I-2 Senior Optimal
                  Principal Amount and the Class I-PO Principal Distribution
                  Amount, such amounts shall be reduced, and such



                                      -97-
<PAGE>


                  remaining funds will be distributed on the Group I Senior
                  Certificates (other than the Interest Only Certificates) on
                  the basis of such reduced amount. Notwithstanding any
                  reduction in principal distributable to the Class I-PO
                  Certificates pursuant to this paragraph, the Current Principal
                  Amount of the Class I-PO Certificates shall be reduced not
                  only by principal so distributed but also by the difference
                  between (i) principal distributable to the Class I-PO
                  Certificates in accordance with the priority SIXTH under
                  clause (A) above and (ii) principal actually distributed to
                  the Class I-PO Certificate after giving effect to this
                  paragraph (such difference, the "Class I-PO Certificate Cash
                  Shortfall"). The Class I-PO Certificate Cash Shortfall with
                  respect to any Distribution Date will be added to the Class
                  I-PO Certificate Deferred Amount.

                  (ii) Interest and principal on the Group II Certificates will
         be distributed monthly on each Distribution Date, commencing in July
         2003, in an amount equal to the Group II Available Funds on deposit in
         the Distribution Account for such Distribution Date. In addition, on
         the first Distribution Date, the $150 deposited by the Seller into the
         Distribution Account on the Closing Date for the Class R-II, Class
         R-III and Class R-IV Certificates (the "Class R Deposit") will be
         distributed to the Class R-II, Class R-III and Class R-IV Certificates,
         in reduction of its Current Principal Amount, until its Current
         Principal Amount has been reduced to zero.

                  (A) On each Distribution Date, the Group II Available Funds
                  (and solely in the case of the Class R-II, Class R-III and
                  Class R-IV Certificates, the Class R Deposit) will be
                  distributed to the Group II Senior Certificates as follows:

                           FIRST, to the Group II Senior Certificates (other
                           than the Class R-II, Class R-III and Class R-IV
                           Certificates), on a pro rata basis, the Accrued
                           Certificate Interest on such Classes for such
                           Distribution Date. As described below, Accrued
                           Certificate Interest on the Group II Senior
                           Certificates is subject to reduction in the event of
                           certain Net Interest Shortfalls allocable thereto;

                           SECOND, to the Group II Senior Certificates (other
                           than the Class R-II, Class R-III and Class R-IV
                           Certificates), on a pro rata basis, any Accrued
                           Certificate Interest thereon remaining undistributed
                           from previous Distribution Dates, to the extent of
                           remaining Group II Available Funds; and

                           THIRD, (i) from the Group II Available Funds, to the
                           Class II-A1 Certificates, in reduction of the Current
                           Principal Amounts thereof, the Group II Senior
                           Optimal Principal Amount for such Distribution Date
                           to the extent of remaining Group II Available Funds
                           and (ii) from the Class R Deposit, to the Class R-II,
                           Class R-III and Class R-IV Certificates, in each
                           case, until the Current Principal Amount of each such
                           Class has been reduced to zero;

                  (B) On each Distribution Date on or prior to the Group II
                  Cross-Over Date, an amount equal to any remaining Group II
                  Available Funds after the distributions in clause (A) above
                  will be distributed sequentially, in the following order, to
                  the Class



                                      -98-
<PAGE>


                  II-B1, Class II-B2, Class II-B3, Class II-B4, Class II-B5 and
                  Class II-B6 Certificates, in each case up to an amount equal
                  to and in the following order: (A) the Accrued Certificate
                  Interest thereon for such Distribution Date, (B) any Accrued
                  Certificate Interest thereon remaining undistributed from
                  previous Distribution Dates and (C) such Class's Allocable
                  Share for such Distribution Date, in each case, to the extent
                  of the remaining Group II Available Funds.

                  (C) If, after distributions have been made pursuant to
                  priorities FIRST, and SECOND of clause (ii)(A) above, on any
                  Distribution Date, the remaining Group II Available Funds are
                  less than the Group II Senior Optimal Principal Amount, such
                  amount shall be reduced, and such remaining funds will be
                  distributed on the Group II Senior Certificates on the basis
                  of such reduced amount.

         (b) "Pro rata" distributions among Classes of Certificates will be made
in proportion to the then Current Principal Amount of such Classes.

         (c) On each Distribution Date, any Available Funds remaining after
payment of interest and principal to the Classes of Certificates entitled
thereto, as described above, will be distributed to the Class R-IV Certificates;
provided that solely in the case of Group I, if on any Distribution Date there
are any Group I-1 Available Funds or Group I-2 Available Funds remaining after
payment of interest and principal to a Class or Classes of Group I Certificates
entitled thereto, such amounts will be distributed to the other Classes of Group
I Senior Certificates, pro rata, based upon their Current Principal Amounts,
until all amounts due to all Classes of Group I Senior Certificates have been
paid in full, before any amounts are distributed to the Class R-IV Certificates.

         (d) No Accrued Certificate Interest will be payable with respect to any
Class of Certificates after the Distribution Date on which the Current Principal
Amount of such Certificate has been reduced to zero.

         (e) If on any Distribution Date the Available Funds for the Senior
Certificates in any Certificate Group is less than the Accrued Certificate
Interest on the related Senior Certificates for such Distribution Date prior to
reduction for Net Interest Shortfalls and the interest portion of Realized
Losses, the shortfall will be allocated among the holders of each Class of
Senior Certificates in such Certificate Group in proportion to the respective
amounts of Accrued Certificate Interest that would have been allocated thereto
in the absence of such Net Interest Shortfalls and/or Realized Losses for such
Distribution Date. In addition, the amount of any interest shortfalls will
constitute unpaid Accrued Certificate Interest and will be distributable to
holders of the Certificates of the related Classes entitled to such amounts on
subsequent Distribution Dates, to the extent of the applicable Available Funds
after current interest distributions as required herein. Any such amounts so
carried forward will not bear interest. Shortfalls in interest payments will not
be offset by a reduction in the servicing compensation of the Master Servicer or
otherwise, except to the extent of applicable Compensating Interest Payments.

         (f) On each Distribution Date, the aggregate amount of Deferred
Interest, if any, that is



                                      -99-
<PAGE>


added to the principal balance of the Group II Mortgage Loans on the Due Date
occurring in the month in which such Distribution Date occurs will be allocated
to each class of Group II Certificates as an Interest Shortfall as described in
clause (e) above, on a pro rata basis based on a fraction, the numerator of
which is the Current Principal Amount of each such Class and the denominator of
which is the aggregate Current Principal Amount of such Classes of Certificates,
in each case immediately prior to such Distribution Date. Deferred Interest
allocated to any Group II Certificate on any Distribution Date will be added to
the Current Principal Amount thereof on such Distribution Date and will
thereafter bear interest at the then applicable adjustable Pass-Through Rate.

         (g) The expenses and fees of the Trust shall be paid by each of the
REMICs, to the extent that such expenses relate to the assets of each of such
respective REMICs, and all other expenses and fees of the Trust shall be paid
pro rata by each of the REMICs.

         Section 6.02 ALLOCATION OF LOSSES. (a) On or prior to each
Determination Date, the Master Servicer shall determine the amount of any
Realized Loss in respect of each Mortgage Loan that occurred during the
immediately preceding calendar month.

         (b) REALIZED LOSSES ON THE GROUP I MORTGAGE LOANS. Realized Losses with
respect to a Group I Mortgage Loan will be allocated on a pro rata basis between
the applicable PO Percentage of the Scheduled Principal Balance of such Mortgage
Loan and the applicable Non-PO Percentage of such Scheduled Principal Balance.

                  (i) On each Distribution Date, the applicable PO Percentage of
         the principal portion of any Realized Loss on a Discount Mortgage Loan
         and any Class I-PO Certificate Cash Shortfall shall be allocated to the
         Class I-PO Certificates until the Current Principal Amount thereof has
         been reduced to zero.

                  (ii) On each Distribution Date, the applicable Non-PO
         Percentage of the principal portion of any Realized Loss on a Group I
         Mortgage Loan shall be allocated as follows:

                  first, to the Class I-B6 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  second, to the Class I-B5 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  third, to the Class I-B4 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  fourth, to the Class I-B3 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  fifth, to the Class I-B2 Certificates until the Current
         Principal Amount thereof has been reduced to zero;




                                     -100-
<PAGE>


                  sixth, to the Class I-B1 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  seventh, (x) if such loss is on a Group I-1 Mortgage Loan, to
         the Class I-F1 Certificates and (y) if such loss is on a Group I-2
         Mortgage Loan, to the Class I-F2 Certificates, in each case until the
         Current Principal Amount thereof has been reduced to zero; and

                  eighth, to the Group I Senior Certificates (other than the
         Interest Only Certificates and the Principal Only Certificates), on a
         pro rata basis.

         (c) REALIZED LOSSES ON THE GROUP II MORTGAGE LOANS. On each
Distribution Date, the principal portion of any Realized Loss on a Group II
Mortgage Loan shall be allocated as follows:

                  first, to the Class II-B6 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  second, to the Class II-B5 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  third, to the Class II-B4 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  fourth, to the Class II-B3 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  fifth, to the Class II-B2 Certificates until the Current
         Principal Amount thereof has been reduced to zero;

                  sixth, to the Class II-B1 Certificates until the Current
         Principal Amount thereof has been reduced to zero; and

                  seventh, to the Class II-A1 Certificates until the Current
         Principal Amount thereof has been reduced to zero.

         (d) Notwithstanding (x) the foregoing clause (b), no such allocation of
any Realized Loss shall be made on a Distribution Date to any Class of Group I
Certificates to the extent that such allocation would result in the reduction of
the aggregate Current Principal Amounts of all the Group I Certificates as of
such Distribution Date, after giving effect to all distributions and prior
allocations of Realized Losses on the Group I Mortgage Loans on such date, to an
amount less than the aggregate Scheduled Principal Balance of all of the Group I
Mortgage Loans as of the first day of the month of such Distribution Date (such
limitation, the "Group I Loss Allocation Limitation") and (y) the foregoing
clause (c), no such allocation of any Realized Loss shall be made on a
Distribution Date to any Class of Group II Certificates to the extent that such
allocation would result in the reduction of the aggregate Current Principal
Amounts of all the Group II Certificates as of such Distribution Date, after
giving effect to all distributions and prior allocations of Realized



                                     -101-
<PAGE>


Losses on the Group II Mortgage Loans on such date, to an amount less than the
aggregate Scheduled Principal Balance of all of the Group II Mortgage Loans as
of the first day of the month of such Distribution Date (such limitation, the
"Group 2 Loss Allocation Limitation").

         (e) Notwithstanding the foregoing clauses (b) and (c), any Special
Hazard Loss allocable to the Group I Senior Certificates or Group II Senior
Certificates pursuant to clauses (b) or (c) above after the Group I Cross-Over
Date or Group II Cross-Over Date, respectively, shall be allocated to such
Senior Certificates and the most subordinate Class or Classes of Group II
Subordinate Certificates and Group I Subordinate Certificates, respectively, on
a pro rata basis, based on the Current Principal Amounts of such Certificates,
in reduction of the Current Principal Amounts thereof until reduced to zero,
with any such loss allocable to such Subordinate Certificates allocated in the
order described in clause (b) or (c) above, as applicable.

         (f) Any Realized Losses allocated to a Class of Certificates shall be
allocated among the Certificates of such Class (other than the Interest Only
Certificates) in proportion to their respective Current Principal Amounts. Any
allocation of Realized Losses shall be accomplished by reducing the Current
Principal Amount of the related Certificates on the related Distribution Date.

         (g) Realized Losses shall be allocated on the Distribution Date in the
month following the month in which such loss was incurred and, in the case of
the principal portion thereof, after giving effect to distributions made on such
Distribution Date.

         (h) On each Distribution Date, the Securities Administrator shall
determine and notify the Trustee of the Group I Subordinate Certificate
Writedown Amount and the Group II Subordinate Certificate Writedown Amount. Any
Group I Subordinate Certificate Writedown Amount shall effect a corresponding
reduction in the Current Principal Amount of (i) if prior to the Group I
Cross-Over Date, the Current Principal Amounts of the Group I Subordinate
Certificates, in the reverse order of their numerical Class designations and
(ii) from and after the Group I Cross-Over Date, the Group I Senior
Certificates, in accordance with priorities set forth in clause (b) above, which
reduction shall occur on such Distribution Date after giving effect to
distributions made on such Distribution Date. Any Group II Subordinate
Certificate Writedown Amount shall effect a corresponding reduction in the
Current Principal Amount of (i) if prior to the Group II Cross-Over Date, the
Current Principal Amounts of the Group II Subordinate Certificates, in the
reverse order of their numerical Class designations and (ii) from and after the
Group II Cross-Over Date, the Group II Senior Certificates, which reduction
shall occur on such Distribution Date after giving effect to distributions made
on such Distribution Date.

         (i) On each Distribution Date, on or prior to the Group I Cross-Over
Date the Securities Administrator shall determine the Class I-PO Certificate
Deferred Payment Writedown Amount with respect to the Class I-PO Certificates,
if any. Any such Class I-PO Certificate Deferred Payment Writedown Amount with
respect to the I-Class PO Certificates shall effect a corresponding reduction in
the Current Principal Amount of the Group I Subordinate Certificates in the
order described in clause (b) above.

         (j) Any Net Interest Shortfall will be allocated among the Classes of
Certificates in proportion to the respective amounts of Accrued Certificate
Interest that would have been allocated



                                     -102-
<PAGE>


thereto in the absence of such Net Interest Shortfall for such Distribution
Date. The interest portion of any Realized Losses with respect to the Group I
Mortgage Loans occurring on or prior to the Group I Cross-Over Date will not be
allocated among any Certificates, but will reduce the amount of Group I
Available Funds on the related Distribution Date. As a result of the
subordination of the Group I Subordinate Certificates in right of distribution,
such Realized Losses will be borne by the Group I Subordinate Certificates in
inverse order of their numerical Class designations. Following the Group I
Cross-Over Date, the interest portion of Realized Losses on the Group I Mortgage
Loans will be allocated to the related Group I Senior Certificates (other than
the Principal Only Certificates). The interest portion of any Realized Losses
with respect to the Group II Mortgage Loans occurring on or prior to the Group
II Cross-Over Date will not be allocated among any Certificates, but will reduce
the amount of Group II Available Funds on the related Distribution Date. As a
result of the subordination of the Group II Subordinate Certificates in right of
distribution, such Realized Losses will be borne by the Group II Subordinate
Certificates in inverse order of their numerical Class designations. Following
the Group II Cross-Over Date, the interest portion of Realized Losses on the
Group II Mortgage Loans will be allocated to the Group II Senior Certificates.

         Section 6.03 PAYMENTS. (a) On each Distribution Date, other than the
final Distribution Date, the Trustee shall distribute to each Certificateholder
of record as of the immediately preceding Record Date the Certificateholder's
pro rata share of its Class (based on the aggregate Fractional Undivided
Interest represented by such Holder's Certificates) of all amounts required to
be distributed on such Distribution Date to such Class, based on information
provided to the Trustee by the Securities Administrator. The Securities
Administrator shall calculate the amount to be distributed to each Class and,
based on such amounts, the Securities Administrator shall determine the amount
to be distributed to each Certificateholder. All of the Securities
Administrator's calculations of payments shall be based solely on information
provided to the Securities Administrator by the Master Servicer. Neither the
Securities Administrator nor the Trustee shall be required to confirm, verify or
recompute any such information but shall be entitled to rely conclusively on
such information.

         (b) Payment of the above amounts to each Certificateholder shall be
made (i) by check mailed to each Certificateholder entitled thereto at the
address appearing in the Certificate Register or (ii) upon receipt by the
Trustee on or before the fifth Business Day preceding the Record Date of written
instructions from a Certificateholder by wire transfer to a United States dollar
account maintained by the payee at any United States depository institution with
appropriate facilities for receiving such a wire transfer; provided, however,
that the final payment in respect of each Class of Certificates will be made
only upon presentation and surrender of such respective Certificates at the
office or agency of the Trustee specified in the notice to Certificateholders of
such final payment.



                                     -103-
<PAGE>


         Section 6.04 STATEMENTS TO CERTIFICATEHOLDERS. (a) Concurrently with
each distribution to Certificateholders, the Securities Administrator shall make
available to the parties hereto and each Certificateholder via the Securities
Administrator's internet website as set forth below, the following information,
expressed with respect to clauses (i) through (vii) in the aggregate and as a
Fractional Undivided Interest representing an initial Current Principal Amount
of $1,000, or in the case of each of the Class R-I, Class R-II, Class R-III and
Class R-IV Certificates, an initial Current Principal Amount of $50:

                  (i) the Current Principal Amount or Notional Amount of each
         Class of Certificates immediately prior to such Distribution Date;

                  (ii) the amount of the distribution allocable to principal on
         each applicable Class of Certificates;

                  (iii) the aggregate amount of interest accrued at the related
         Pass-Through Rate with respect to each Class during the related
         Interest Accrual Period;

                  (iv) the Net Interest Shortfall and any other adjustments to
         interest at the related Pass-Through Rate necessary to account for any
         difference between interest accrued and aggregate interest distributed
         with respect to each Class of Certificates;

                  (v) the amount of the distribution allocable to interest on
         each Class of Certificates;

                  (vi) the Pass-Through Rates for each Class of Certificates
         with respect to such Distribution Date;

                  (vii) the Current Principal Amount or Notional Amount of each
         Class of Certificates after such Distribution Date;

                  (viii) the amount of any Monthly Advances, Compensating
         Interest Payments and outstanding unreimbursed advances by the Master
         Servicer or the Servicer included in such distribution separately
         stated for each Loan Group;

                  (ix) the aggregate amount of any Realized Losses (listed
         separately for each category of Realized Loss and for each Loan Group)
         during the related Prepayment Period and cumulatively since the Cut-off
         Date and the amount and source (separately identified) of any
         distribution in respect thereof included in such distribution;

                  (x) with respect to each Mortgage Loan which incurred a
         Realized Loss during the related Prepayment Period, (i) the loan
         number, (ii) the Scheduled Principal Balance of such Mortgage Loan as
         of the Cut-off Date, (ii) the Scheduled Principal Balance of such
         Mortgage Loan as of the beginning of the related Due Period, (iii) the
         Net Liquidation Proceeds with respect to such Mortgage Loan and (iv)
         the amount of the Realized Loss with respect to such Mortgage Loan;



                                     -104-
<PAGE>


                  (xi) with respect to each Loan Group, the amount of Scheduled
         Principal and Principal Prepayments, (including but separately
         identifying the principal amount of Principal Prepayments, Insurance
         Proceeds, the purchase price in connection with the purchase of
         Mortgage Loans, cash deposits in connection with substitutions of
         Mortgage Loans and Net Liquidation Proceeds) and the number and
         principal balance of Mortgage Loans purchased or substituted for during
         the relevant period and cumulatively since the Cut- off Date;

                  (xii) the number of Mortgage Loans (excluding REO Property) in
         each Loan Group remaining in the Trust Fund as of the end of the
         related Prepayment Period;

                  (xiii) information for each Loan Group and in the aggregate
         regarding any Mortgage Loan delinquencies as of the end of the related
         Prepayment Period, including the aggregate number and aggregate
         Outstanding Principal Balance of Mortgage Loans (a) delinquent 30 to 59
         days on a contractual basis, (b) delinquent 60 to 89 days on a
         contractual basis, and (c) delinquent 90 or more days on a contractual
         basis, in each case as of the close of business on the last Business
         Day of the immediately preceding month;

                  (xiv) for each Loan Group, the number of Mortgage Loans in the
         foreclosure process as of the end of the related Due Period and the
         aggregate Outstanding Principal Balance of such Mortgage Loans;

                  (xv) for each Loan Group, the number and aggregate Outstanding
         Principal Balance of all Mortgage Loans as to which the Mortgaged
         Property was REO Property as of the end of the related Due Period;

                  (xvi) the book value (the sum of (A) the Outstanding Principal
         Balance of the Mortgage Loan, (B) accrued interest through the date of
         foreclosure and (C) foreclosure expenses) of any REO Property in each
         Loan Group; provided that, in the event that such information is not
         available to the Securities Administrator on the Distribution Date,
         such information shall be furnished promptly after it becomes
         available;

                  (xvii) the amount of Realized Losses allocated to each Class
         of Certificates since the prior Distribution Date and in the aggregate
         for all prior Distribution Dates;

                  (xviii) the Average Loss Severity for the prior calendar month
         for each Loan Group;

                  (xix) the then applicable Group 1, Group 2 and Group 3 Senior
         Percentage, Group 1, Group 2 and Group 3 Senior Prepayment Percentage,
         Group 1, Group 2 and Group 3 Subordinate Percentage and Group 1, Group
         2 and Group 3 Subordinate Prepayment Percentage;

                  (xx) the amount of Deferred Interest; and

                  (xxi) any Diverted Amount for such Distribution Date.



                                     -105-
<PAGE>


         The information set forth above shall be calculated or reported, as the
case may be, by the Securities Administrator and the Trustee, based solely on,
and to the extent of, information provided to the Securities Administrator by
the Master Servicer. The Securities Administrator and the Trustee may
conclusively rely on such information and shall not be required to confirm,
verify or recalculate any such information.

         The Securities Administrator may make available each month, to any
interested party , the monthly statement to Certificateholders via the
Securities Administrator's website initially located at "www.ctslink.com."
Assistance in using the website can be obtained by calling the Securities
Administrator's customer service desk at (301) 815-6600. Parties that are unable
to use the above distribution option are entitled to have a paper copy mailed to
them via first class mail by calling the Securities Administrator's customer
service desk and indicating such. The Securities Administrator shall have the
right to change the way such reports are distributed in order to make such
distribution more convenient and/or more accessible to the parties, and the
Securities Administrator shall provide timely and adequate notification to all
parties regarding any such change.

         To the extent timely received from the Securities Administrator, the
Trustee will also make monthly statements available each month to
Certificateholders via the Trustee's internet website. The Trustee's internet
website will initially be located at https://www.corporatetrust.db.com/invr.
Assistance in using the Trustee's website service can be obtained by calling the
Trustee's investor relations desk at (800) 735-7777. The Trustee shall have the
right to change the way such reports are distributed in order to make such
distribution more convenient and/or more accessible to the parties, and the
Trustee shall provide timely and adequate notification to all parties regarding
any such change.

         (b) By April 30 of each year beginning in 2004, the Trustee will
furnish such report, as prepared by the Securities Administrator, to each Holder
of the Certificates of record at any time during the prior calendar year as to
the aggregate of amounts reported pursuant to subclauses (a)(ii) and (a)(v)
above with respect to the Certificates, plus information with respect to the
amount of servicing compensation and such other customary information as the
Securities Administrator may determine and advises the Trustee to be necessary
and/or to be required by the Internal Revenue Service or by a federal or state
law or rules or regulations to enable such Holders to prepare their tax returns
for such calendar year. Such obligations shall be deemed to have been satisfied
to the extent that substantially comparable information shall be provided by the
Securities Administrator or the Trustee pursuant to the requirements of the
Code.

         Section 6.05 MONTHLY ADVANCES. If the Scheduled Payment on a Mortgage
Loan that was due on a related Due Date and is delinquent other than as a result
of application of the Relief Act and for which the related WF Servicer or
Sub-Master Servicer was required to make an advance pursuant to the related
Servicing Agreement or Sub-Master Servicing Agreement exceeds the amount
deposited in the Master Servicer Collection Account which will be used for an
advance with respect to such Mortgage Loan, the Master Servicer will deposit in
the Master Servicer Collection Account not later than the Distribution Account
Deposit Date immediately preceding the related Distribution Date an amount equal
to such deficiency, net of the Servicing Fee and Sub-Master



                                     -106-
<PAGE>


Servicing Fee, if applicable, for such Mortgage Loan except to the extent the
Master Servicer determines any such advance to be a Nonrecoverable Advance.
Subject to the foregoing, the Master Servicer shall continue to make such
advances through the date that the related WF Servicer or Sub-Master Servicer is
required to do so under its Servicing Agreement or Sub-Master Servicing
Agreement, as applicable. If the Master Servicer deems an advance to be a
Nonrecoverable Advance, on the Distribution Account Deposit Date, the Master
Servicer shall present an Officer's Certificate to the Trustee (i) stating that
the Master Servicer elects not to make a Monthly Advance in a stated amount and
(ii) detailing the reason it deems the advance to be a Nonrecoverable Advance.

         Section 6.06 COMPENSATING INTEREST PAYMENTS. The Master Servicer shall
deposit in the Master Servicer Collection Account not later than each
Distribution Account Deposit Date an amount equal to the lesser of (i) the sum
of the aggregate amounts required to be paid by the WF Servicers and Sub-Master
Servicers under the Servicing Agreements and Sub-Master Servicing Agreements
with respect to subclauses (a) and (b) of the definition of Interest Shortfall
with respect to the Mortgage Loans for the related Distribution Date, and not so
paid by the related WF Servicers or Sub-Master Servicers and (ii) the Master
Servicer Compensation for such Distribution Date (such amount, the "Compensating
Interest Payment"). The Master Servicer shall not be entitled to any
reimbursement of any Compensating Interest Payment.



                                     -107-
<PAGE>



                                   ARTICLE VII
                               The Master Servicer

         Section 7.01 LIABILITIES OF THE MASTER SERVICER. The Master Servicer
shall be liable in accordance herewith only to the extent of the obligations
specifically imposed upon and undertaken by it herein.

         Section 7.02 MERGER OR CONSOLIDATION OF THE MASTER SERVICER.

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

         (b) Any Person into which the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation to
which the Master Servicer shall be a party, or any Person succeeding to the
business of the Master Servicer, shall be the successor of the Master Servicer
hereunder, without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.

         Section 7.03 INDEMNIFICATION OF THE TRUSTEE, THE MASTER SERVICER AND
THE SECURITIES ADMINISTRATOR. (a) The Master Servicer agrees to indemnify the
Indemnified Persons for, and to hold them harmless against, any loss, liability
or expense (including reasonable legal fees and disbursements of counsel)
incurred on their part that may be sustained in connection with, arising out of,
or relating to, any claim or legal action (including any pending or threatened
claim or legal action) relating to this Agreement, the Servicing Agreements, the
Sub-Master Servicing Agreements, the Assignment Agreements or the Certificates
or the powers of attorney delivered by the Trustee hereunder (i) related to the
Master Servicer's failure to perform its duties in compliance with this
Agreement (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement) or (ii) incurred by reason of the
Master Servicer's willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder, provided, in each case, that with respect to
any such claim or legal action (or pending or threatened claim or legal action),
the Trustee shall have given the Master Servicer and the Seller written notice
thereof promptly after the Trustee shall have with respect to such claim or
legal action knowledge thereof. The Master Servicer's failure to receive any
such notice shall not affect the Trustee's right to indemnification hereunder,
except to the extent the Master Servicer is materially prejudiced by such
failure to give notice. This indemnity shall survive the resignation or removal
of the Trustee, Master Servicer or the Securities Administrator and the
termination of this Agreement.

         (b) The Seller will indemnify any Indemnified Person for any loss,
liability or expense of any Indemnified Person not otherwise covered by the
Master Servicer's indemnification pursuant to Subsection (a) above.




                                     -108-
<PAGE>



         Section 7.04 LIMITATIONS ON LIABILITY OF THE MASTER SERVICER AND
OTHERS. Subject to the obligation of the Master Servicer to indemnify the
Indemnified Persons pursuant to Section 7.03:

         (a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Indemnified Persons, the Seller, the Trust Fund or the Certificateholders for
taking any action or for refraining from taking any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Master Servicer or any such Person against
any breach of warranties or representations made herein or any liability which
would otherwise be imposed by reason of such Person's willful misfeasance, bad
faith or gross negligence in the performance of duties or by reason of reckless
disregard of obligations and duties hereunder.

         (b) The Master Servicer and any director, officer, employee or agent of
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.

         (c) The Master Servicer, the Custodian and any director, officer,
employee or agent of the Master Servicer or the Custodian shall be indemnified
by the Trust and held harmless thereby against any loss, liability or expense
(including reasonable legal fees and disbursements of counsel) incurred on their
part that may be sustained in connection with, arising out of, or related to,
any claim or legal action (including any pending or threatened claim or legal
action) relating to this Agreement, the Certificates, any Sub-Master Servicing
Agreement (except to the extent that the Master Servicer is indemnified by the
Sub-Master Servicer thereunder) or any Servicing Agreement (except to the extent
that the Master Servicer is indemnified by the Servicer thereunder), other than
(i) any such loss, liability or expense related to the Master Servicer's failure
to perform its duties in compliance with this Agreement (except as any such
loss, liability or expense shall be otherwise reimbursable pursuant to this
Agreement), or to the Custodian's failure to perform its duties under the
Custodial Agreement, respectively, or (ii) any such loss, liability or expense
incurred by reason of the Master Servicer's or the Custodian's willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder or under the Custodial Agreement, as applicable, or by reason of
reckless disregard of obligations and duties hereunder or under the Custodial
Agreement, as applicable.

         (d) The Master Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its duties under
this Agreement and that in its opinion may involve it in any expense or
liability; provided, however, the Master Servicer may in its discretion, with
prior notice to the Trustee, 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 shall be expenses, costs and liabilities of the Trust Fund,
and the Master Servicer shall be entitled to be reimbursed therefor out of the
Master Servicer Collection Account as provided by Section 4.03. Nothing in this
Subsection 7.04(d) shall affect the Master Servicer's obligation to supervise,
or to take such actions as are necessary to ensure, the servicing and
administration of the Mortgage Loans pursuant to Subsection 3.01(a).




                                     -109-
<PAGE>


         (e) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be required to investigate or make recommendations
concerning potential liabilities which the Trust might incur as a result of such
course of action by reason of the condition of the Mortgaged Properties but
shall give notice to the Trustee if it has notice of such potential liabilities.

         (f) The Master Servicer shall not be liable for any acts or omissions
of any Servicer or any Sub-Master Servicer, except as otherwise expressly
provided herein.

         Section 7.05 MASTER SERVICER NOT TO RESIGN. Except as provided in
Section 7.07, the Master Servicer shall not resign from the obligations and
duties hereby imposed on it except upon a determination that any such duties
hereunder are no longer permissible under applicable law and such
impermissibility cannot be cured. Any such determination permitting the
resignation of the Master Servicer shall be evidenced by an Opinion of
Independent Counsel addressed to the Trustee to such effect delivered to the
Trustee. No such resignation by the Master Servicer shall become effective until
EMC or the Trustee or a successor to the Master Servicer reasonably satisfactory
to the Trustee shall have assumed the responsibilities and obligations of the
Master Servicer in accordance with Section 8.02 hereof. The Trustee shall notify
the Rating Agencies of the resignation of the Master Servicer.

         Section 7.06 SUCCESSOR MASTER SERVICER. In connection with the
appointment of any successor master servicer or the assumption of the duties of
the Master Servicer, EMC or the Trustee may make such arrangements for the
compensation of such successor master servicer out of payments on the Mortgage
Loans as EMC and such successor master servicer shall agree. Notwithstanding the
foregoing, the compensation payable to a successor master servicer may not
exceed the compensation which the Master Servicer would have been entitled to
retain if the Master Servicer had continued to act as Master Servicer hereunder.

         Section 7.07 SALE AND ASSIGNMENT OF MASTER SERVICING. The Master
Servicer may sell and assign its rights and delegate its duties and obligations
in its entirety as Master Servicer under this Agreement and EMC may terminate
the Master Servicer without cause and select a new Master Servicer; provided,
however, that: (i) the purchaser or transferee accepting such assignment and
delegation (a) shall be a Person which shall be qualified to service mortgage
loans for Fannie Mae or Freddie Mac; (b) shall 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); and (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, 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, qualified or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect delivered to the Master
Servicer and the Trustee; (iii) the Master Servicer assigning and selling the
master servicing shall deliver to the Trustee an Officer's Certificate and an
Opinion of Independent Counsel addressed to



                                     -110-
<PAGE>


the Trustee, 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; and (iv) in the event the Master Servicer is
terminated without cause by EMC, EMC shall pay the terminated Master Servicer a
termination fee equal to 0.25% of the aggregate Scheduled Principal Balance of
the Mortgage Loans at the time the master servicing of the Mortgage Loans is
transferred to the successor Master Servicer. No such assignment or delegation
shall affect any liability of the Master Servicer arising prior to the effective
date thereof.




                                     -111-
<PAGE>



                                  ARTICLE VIII
                                     Default

         Section 8.01 EVENTS OF DEFAULT. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) and
only with respect to the defaulting Master Servicer:

                  (i) The Master Servicer fails to cause to be deposited in the
         Distribution Account any amount so required to be deposited pursuant to
         this Agreement (other than a Monthly Advance), and such failure
         continues unremedied for a period of three Business Days after the date
         upon which written notice of such failure, requiring the same to be
         remedied, shall have been given to the Master Servicer; or

                  (ii) The Master Servicer fails to observe or perform in any
         material respect any other material covenants and agreements set forth
         in this Agreement to be performed by it, which covenants and agreements
         materially affect the rights of Certificateholders, and such failure
         continues unremedied for a period of 60 days after the date on which
         written notice of such failure, properly 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 evidencing Fractional Undivided Interests aggregating not
         less than 25% of the Trust Fund; or

                  (iii) There is entered against the Master Servicer a decree or
         order by a court or agency or supervisory authority having jurisdiction
         in the premises for the appointment of a conservator, receiver or
         liquidator in any insolvency, readjustment of debt, marshaling of
         assets and liabilities or similar proceedings, or for the winding up or
         liquidation of its affairs, and the continuance of any such decree or
         order is unstayed and in effect for a period of 60 consecutive days, or
         an involuntary case is commenced against the Master Servicer under any
         applicable insolvency or reorganization statute and the petition is not
         dismissed within 60 days after the commencement of the case; or

                  (iv) The Master Servicer consents 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 substantially all of its
         property; or the Master Servicer admits in writing its inability to pay
         its debts generally as they become due, files a petition to take
         advantage of any applicable insolvency or reorganization statute, makes
         an assignment for the benefit of its creditors, or voluntarily suspends
         payment of its obligations;

                  (v) The Master Servicer assigns or delegates its duties or
         rights under this Agreement in contravention of the provisions
         permitting such assignment or delegation under Sections 7.05 or 7.07;
         or




                                     -112-
<PAGE>



                  (vi) The Master Servicer fails to deposit, or cause to be
         deposited, in the Distribution Account any Monthly Advance (other than
         a Nonrecoverable Advance) by 5:00 p.m. New York City time on the
         Distribution Account Deposit Date.

In each and every such case, so long as such Event of Default with respect to
the Master Servicer shall not have been remedied, the Trustee may, and if
directed by Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the principal of the Trust Fund, by notice in
writing to the Master Servicer (and to the Trustee if given by such
Certificateholders), with a copy to the Rating Agencies, and with the consent of
EMC, terminate all of the rights and obligations (but not the liabilities) of
the Master Servicer under this Agreement and in and to the Mortgage Loans and/or
the REO Property serviced by the Master Servicer and the proceeds thereof. Upon
the receipt by the Master Servicer of the written notice, all authority and
power of the Master Servicer under this Agreement, whether with respect to the
Certificates, the Mortgage Loans, REO Property or under any other related
agreements (but only to the extent that such other agreements relate to the
Mortgage Loans or related REO Property) shall, subject to Section 8.02,
automatically and without further action pass to and be vested in the Trustee
pursuant to this Section 8.01; 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. The Master Servicer agrees to cooperate with
the Trustee in effecting the termination of the Master Servicer's rights and
obligations hereunder, including, without limitation, the transfer to the
Trustee of (i) the property and amounts which are then or should be part of the
Trust or which thereafter become part of the Trust; and (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. In addition to any
other amounts which are then, or, notwithstanding the termination of its
activities under this Agreement, may become payable to the Master Servicer under
this Agreement, the Master Servicer shall be entitled to receive, out of any
amount received on account of a Mortgage Loan or related REO Property, that
portion of such payments which it would have received as reimbursement under
this Agreement if notice of termination had not been given. The termination of
the rights and obligations of the Master Servicer shall not affect any
obligations incurred by the Master Servicer prior to such termination.

         Notwithstanding the foregoing, if an Event of Default described in
clause (vi) of this Section 8.01 shall occur, the Trustee shall (without the
consent of EMC), by notice in writing to the Master Servicer, which may be
delivered by telecopy, immediately terminate all of the rights and obligations
of the Master Servicer thereafter arising under this Agreement, but without
prejudice to any rights it may have as a Certificateholder or to reimbursement
of Monthly Advances and other advances of its own funds, and the Trustee shall
act as provided in Section 8.02 to carry out the duties of the Master Servicer,
including the obligation to make any Monthly Advance the nonpayment of which was
an Event of Default described in clause (vi) of this Section 8.01. Any such
action taken by the Trustee must be prior to the distribution on the relevant
Distribution Date.





                                     -113-
<PAGE>



         Section 8.02 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR. (a) Upon the
receipt by the Master Servicer of a notice of termination pursuant to Section
8.01 or an Opinion of Independent Counsel pursuant to Section 7.05 to the effect
that the Master Servicer is legally unable to act or to delegate its duties to a
Person which is legally able to act, the Trustee shall automatically become the
successor in all respects to the Master Servicer in its capacity under this
Agreement and the transactions set forth or provided for herein and shall
thereafter be subject to all the responsibilities, duties, liabilities and
limitations on liabilities relating thereto placed on the Master Servicer by the
terms and provisions hereof; provided, however, that EMC shall have the right to
either (a) immediately assume the duties of the Master Servicer or (b) select a
successor Master Servicer; provided further, however, that the Trustee shall
have no obligation whatsoever with respect to any liability incurred by the
Master Servicer prior to the time of termination. Notwithstanding the foregoing,
if the Master Servicer is terminated pursuant to clause (vi) of Section 8.01,
the Trustee in its capacity as successor Master Servicer shall be required to
make such Monthly Advances, as set forth in Section 8.01. As compensation
therefor, but subject to Section 7.06, the Trustee shall be entitled to
compensation which the Master Servicer would have been entitled to retain if the
Master Servicer had continued to act hereunder, except for those amounts due the
Master Servicer as reimbursement permitted under this Agreement for advances
previously made or expenses previously incurred. Notwithstanding the above, the
Trustee may, if it shall be unwilling so to act, or shall, if it is legally
unable so to act, appoint or petition a court of competent jurisdiction to
appoint, any established housing and home finance institution which is a Fannie
Mae- or Freddie Mac-approved servicer, and with respect to a successor to the
Master Servicer only, 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;
provided, that the Trustee shall obtain a letter from each Rating Agency that
the ratings, if any, on each of the Certificates will not be lowered as a result
of the selection of the successor to the Master Servicer. Pending appointment of
a successor to the Master Servicer hereunder, the Trustee shall act in such
capacity as hereinabove provided. In connection with such appointment and
assumption, the successor Master Servicer shall receive compensation out of
payments on the Mortgage Loans; provided, however, that the provisions of
Section 7.06 shall apply and the compensation shall not be in excess of that
which the Master Servicer would have been entitled to if the Master Servicer had
continued to act hereunder. Such successor Master Servicer shall undertake and
assume the obligations to pay compensation to any third Person acting as an
agent or independent contractor in the performance of master servicing
responsibilities hereunder. The Trustee and such successor shall take such
action, consistent with this Agreement, as shall be necessary to effectuate any
such succession. Any costs incurred by a successor Master Servicer or the
Trustee in transitioning the master servicing duties and assuming the duties of
the Master Servicer hereunder shall be payable by the terminated Master
Servicer. In addition, if the Trustee is required to act as successor Master
Servicer following an Event of Default under Section 8.01(vi) and the Trustee
subsequently transitions the master servicing duties to a successor Master
Servicer within 90 days of assuming such master servicing duties, the terminated
Master Servicer (rather than the Trustee as interim successor Master Servicer)
shall be responsible for the costs incurred by the Trustee in transitioning the
master servicing duties to a successor Master Servicer. Any costs or expenses
incurred by the Trustee in transitioning the master servicing duties to a
successor Master Servicer, to the extent not required to be covered by the
terminated Master Servicer in accordance with this Section 8.02, shall be
reimbursable to the Trustee from the Trust Fund.




                                     -114-
<PAGE>



         (b) If the Trustee shall succeed to any duties of the Master Servicer
respecting the Mortgage Loans as provided herein, it shall do so in a separate
capacity and not in its capacity as Trustee and, accordingly, the provisions of
Article IX shall be inapplicable to the Trustee in its duties as the successor
to the Master Servicer in the servicing of the Mortgage Loans (although such
provisions shall continue to apply to the Trustee in its capacity as Trustee);
the provisions of Article VII, however, shall apply to it in its capacity as
successor master servicer.

         Section 8.03 NOTIFICATION TO CERTIFICATEHOLDERS. Upon any termination
or appointment of a successor to the Master Servicer, the Trustee shall give
prompt written notice thereof to Certificateholders at their respective
addresses appearing in the Certificate Register and to the Rating Agencies.

         Section 8.04 WAIVER OF DEFAULTS. The Trustee shall transmit by mail to
all Certificateholders, within 60 days after the occurrence of any Event of
Default actually known to a Responsible Officer of the Trustee, unless such
Event of Default shall have been cured, notice of each such Event of Default.
The Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust Fund may, on behalf of all
Certificateholders, waive any default by the Master Servicer in the performance
of its obligations hereunder and the consequences thereof, except a default in
the making of or the causing to be made any required distribution on the
Certificates, which default may only be waived by Holders of Certificates
evidencing Fractional Undivided Interests aggregating 100% of the Trust Fund.
Upon any such waiver of a past default, such default shall be deemed to cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
timely remedied for every purpose of this Agreement. No such waiver shall extend
to any subsequent or other default or impair any right consequent thereon except
to the extent expressly so waived. The Trustee shall give notice of any such
waiver to the Rating Agencies.

         Section 8.05 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 at such requesting
Certificateholder's expense.



                                     -115-
<PAGE>



                                   ARTICLE IX
             Concerning the Trustee and the Securities Administrator

         Section 9.01 DUTIES OF TRUSTEE. (a) 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, and the Securities Administrator each
undertake to perform such duties and only such duties as are specifically set
forth in this Agreement as duties of the Trustee and the Securities
Administrator, respectively. If an Event of Default has occurred and has not
been cured or waived, the Trustee shall exercise such of the rights and powers
vested in it by this Agreement, and subject to Section 8.02(b) use the same
degree of care and skill in their exercise, as a prudent person would exercise
under the circumstances in the conduct of his own affairs.

         (b) Upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments which are specifically
required to be furnished to the Trustee and the Securities Administrator
pursuant to any provision of this Agreement, the Trustee and the Securities
Administrator, respectively, shall examine them to determine whether they are on
their face in the form required by this Agreement; provided, however, that
neither the Trustee nor the Securities Administrator shall be responsible for
the accuracy or content of any resolution, certificate, statement, opinion,
report, document, order or other instrument furnished hereunder; provided,
further, that neither the Trustee nor the Securities Administrator shall be
responsible for the accuracy or verification of any calculation provided to it
pursuant to this Agreement.

         (c) On each Distribution Date, the Trustee shall make monthly
distributions and the final distribution to the Certificateholders from funds in
the Distribution Account as provided in Sections 6.01 and 10.01 herein based
solely on the report of the Securities Administrator.

         (d) No provision of this Agreement shall be construed to relieve the
Trustee or the Securities Administrator 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 and the Securities
         Administrator shall be determined solely by the express provisions of
         this Agreement, neither the Trustee nor the Securities Administrator
         shall be liable except for the performance of their respective duties
         and obligations as are specifically set forth in this Agreement, no
         implied covenants or obligations shall be read into this Agreement
         against the Trustee or the Securities Administrator and, in the absence
         of bad faith on the part of the Trustee or the Securities
         Administrator, respectively, the Trustee or the Securities
         Administrator, respectively, may conclusively rely, as to the truth of
         the statements and the correctness of the opinions expressed therein,
         upon any certificates or opinions furnished to the Trustee or the
         Securities Administrator, respectively, and conforming to the
         requirements of this Agreement;

                  (ii) Neither the Trustee nor the Securities Administrator
         shall be liable in its individual capacity for an error of judgment
         made in good faith by a Responsible Officer or Responsible Officers of
         the Trustee or an officer of the Securities Administrator,



                                     -116-
<PAGE>



         respectively, unless it shall be proved that the Trustee or the
         Securities Administrator, respectively, was negligent in ascertaining
         the pertinent facts;

                  (iii) Neither the Trustee nor the Securities Administrator
         shall be liable with respect to any action taken, suffered or omitted
         to be taken by it in good faith in accordance with the directions of
         the Holders of Certificates evidencing Fractional Undivided Interests
         aggregating not less than 25% of the Trust Fund, if such action or
         non-action relates to the time, method and place of conducting any
         proceeding for any remedy available to the Trustee or the Securities
         Administrator, respectively, or exercising any trust or other power
         conferred upon the Trustee or the Securities Administrator,
         respectively, under this Agreement;

                  (iv) The Trustee shall not be required to take notice or be
         deemed to have notice or knowledge of any default or Event of Default
         unless a Responsible Officer of the Trustee's Corporate Trust Office
         shall have actual knowledge thereof. In the absence of such notice, the
         Trustee may conclusively assume there is no such default or Event of
         Default;

                  (v) The Trustee shall not in any way be liable by reason of
         any insufficiency in any Account held by or in the name of Trustee
         unless it is determined by a court of competent jurisdiction that the
         Trustee's gross negligence or willful misconduct was the primary cause
         of such insufficiency (except to the extent that the Trustee is obligor
         and has defaulted thereon);

                  (vi) Anything in this Agreement to the contrary
         notwithstanding, in no event shall the Trustee or the Securities
         Administrator be liable for special, indirect or consequential loss or
         damage of any kind whatsoever (including but not limited to lost
         profits), even if the Trustee or the Securities Administrator,
         respectively, has been advised of the likelihood of such loss or damage
         and regardless of the form of action;

                  (vii) None of the Securities Administrator, the Seller, EMC or
         the Trustee shall be responsible for the acts or omissions of the
         other, it being understood that this Agreement shall not be construed
         to render them partners, joint venturers or agents of one another and

                  (viii) Neither the Trustee nor the Securities Administrator
         shall be required to expend or risk its own funds or otherwise incur
         financial liability in the performance of any of its duties hereunder,
         or in the exercise of any of its rights or powers, if there is
         reasonable ground for believing that the repayment of such funds or
         indemnity reasonably satisfactory to it against such risk or liability
         is not reasonably assured to it, and none of the provisions contained
         in this Agreement shall in any event require the Trustee or the
         Securities Administrator to perform, or be responsible for the manner
         of performance of, any of the obligations of the Master Servicer under
         the Servicing Agreements, except during such time, if any, as the
         Trustee shall be the successor to, and be vested with the rights,
         duties, powers and privileges of, the Master Servicer in accordance
         with the terms of this Agreement.



                                     -117-
<PAGE>


         (e) All funds received by the Master Servicer and the Trustee and
required to be deposited in the Master Servicer Collection Account or
Distribution Account pursuant to this Agreement will be promptly so deposited by
the Master Servicer and the Trustee, respectively.

         (f) Except for those actions that the Trustee or the Securities
Administrator is required to take hereunder, neither the Trustee nor the
Securities Administrator shall have any obligation or liability to take any
action or to refrain from taking any action hereunder in the absence of written
direction as provided hereunder.

         Section 9.02 CERTAIN MATTERS AFFECTING THE TRUSTEE AND THE SECURITIES
ADMINISTRATOR. Except as otherwise provided in Section 9.01:

                  (i) The Trustee and the Securities Administrator may rely and
         shall be protected in acting or refraining from acting in reliance on
         any resolution, certificate of the Seller, the Master Servicer or a
         Servicer, certificate of auditors or any other certificate, statement,
         instrument, opinion, report, notice, request, consent, order,
         appraisal, bond or other paper or document believed by it to be genuine
         and to have been signed or presented by the proper party or parties;

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

                  (iii) Neither the Trustee nor the Securities Administrator
         shall be under any obligation to exercise any of the trusts or powers
         vested in it by this Agreement, other than its obligation to give
         notices 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 reasonable security or indemnity 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 Officer of the Trustee has actual knowledge (which has not
         been cured or waived), to exercise such of the rights and powers vested
         in it by this Agreement, and to use the same degree of care and skill
         in their exercise, as a prudent person would exercise under the
         circumstances in the conduct of his own affairs;

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

                  (v) Neither the Trustee nor the Securities Administrator shall
         be bound to make any investigation into the facts or matters stated in
         any resolution, certificate, statement, instrument, opinion, report,
         notice, request, consent, order, approval, bond or other paper



                                     -118-
<PAGE>


         or document, unless requested in writing to do so by Holders of
         Certificates evidencing Fractional Undivided Interests aggregating not
         less than 25% of the Trust Fund and provided that the payment within a
         reasonable time to the Trustee or the Securities Administrator, as
         applicable, of the costs, expenses or liabilities likely to be incurred
         by it in the making of such investigation is, in the opinion of the
         Trustee or the Securities Administrator, as applicable, reasonably
         assured to the Trustee or the Securities Administrator, as applicable,
         by the security afforded to it by the terms of this Agreement. The
         Trustee or the Securities Administrator may require indemnity
         reasonably satisfactory to it against such expense or liability as a
         condition to taking any such action. The reasonable expense of every
         such examination shall be paid by the Certificateholders requesting the
         investigation;

                  (vi) The Trustee and the Securities Administrator may execute
         any of the trusts or powers hereunder or perform any duties hereunder
         either directly or through Affiliates, agents or attorneys; provided,
         however, that the Trustee may not appoint any agent to perform its
         custodial functions with respect to the Mortgage Files or paying agent
         functions under this Agreement without the express written consent of
         the Master Servicer, which consent will not be unreasonably withheld.
         Neither the Trustee nor the Securities Administrator shall be liable or
         responsible for the misconduct or negligence of any of the Trustee's or
         the Securities Administrator's agents or attorneys or a custodian or
         paying agent appointed hereunder by the Trustee or the Securities
         Administrator with due care and, when required, with the consent of the
         Master Servicer. Notwithstanding, any provision to the contrary, the
         Trustee shall not be liable or responsible for any act or omission of
         the Custodian (notwithstanding its specified capacity as agent of the
         Trustee).

                  (vii) Should the Trustee or the Securities Administrator deem
         the nature of any action required on its part, other than a payment or
         transfer under Subsection 4.01(b) or Section 4.02, to be unclear, the
         Trustee or the Securities Administrator, respectively, may require
         prior to such action that it be provided by the Seller with reasonable
         further instructions;

                  (viii) The right of the Trustee or the Securities
         Administrator to perform any discretionary act enumerated in this
         Agreement shall not be construed as a duty, and neither the Trustee nor
         the Securities Administrator shall be accountable for other than its
         negligence or willful misconduct in the performance of any such act;

                  (ix) Neither the Trustee nor the Securities Administrator
         shall be required to give any bond or surety with respect to the
         execution of the trust created hereby or the powers granted hereunder,
         except as provided in Subsection 9.07; and

                  (x) Neither the Trustee nor the Securities Administrator shall
         have any duty to conduct any affirmative investigation as to the
         occurrence of any condition requiring the repurchase of any Mortgage
         Loan by the Mortgage Loan Seller pursuant to this Agreement or the
         Mortgage Loan Purchase Agreement, as applicable, or the eligibility of
         any Mortgage Loan for purposes of this Agreement.




                                     -119-
<PAGE>



         Section 9.03 TRUSTEE AND SECURITIES ADMINISTRATOR NOT LIABLE FOR
CERTIFICATES OR MORTGAGE LOANS. The recitals contained herein and in the
Certificates (other than the signature and countersignature of the Trustee on
the Certificates) shall be taken as the statements of the Seller, and neither
the Trustee nor the Securities Administrator shall have any responsibility for
their correctness. Neither the Trustee nor the Securities Administrator makes
any representation as to the validity or sufficiency of the Certificates (other
than the signature and countersignature of the Trustee on the Certificates) or
of any Mortgage Loan except as expressly provided in Sections 2.02 and 2.05
hereof; provided, however, that the foregoing shall not relieve the Custodian of
the obligation to review the Mortgage Files pursuant to Sections 2.02 and 2.04.
The Trustee's execution and authentication of the Certificates shall be solely
in its capacity as Trustee and shall not constitute the Certificates an
obligation of the Trustee in any other capacity. Neither the Trustee or the
Securities Administrator shall be accountable for the use or application by the
Seller of any of the Certificates or of the proceeds of such Certificates, or
for the use or application of any funds paid to the Seller with respect to the
Mortgage Loans. Subject to the provisions of Section 2.05, neither the Trustee
nor the Securities Administrator shall not be responsible for the legality or
validity of this Agreement or any document or instrument relating to this
Agreement, the validity of the execution of this Agreement or of any supplement
hereto or instrument of further assurance, or the validity, priority, perfection
or sufficiency of the security for the Certificates issued hereunder or intended
to be issued hereunder. Neither the Trustee nor the Securities Administrator
shall at any time have any responsibility or liability for or with respect to
the legality, validity and enforceability of any Mortgage or any Mortgage Loan,
or the perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
Fund or its ability to generate the payments to be distributed to
Certificateholders, under this Agreement. Neither the Trustee nor the Securities
Administrator shall have any responsibility for filing any financing or
continuation statement in any public office at any time or to otherwise perfect
or maintain the perfection of any security interest or lien granted to it
hereunder or to record this Agreement.

         Section 9.04 TRUSTEE AND SECURITIES ADMINISTRATOR MAY OWN CERTIFICATES.
The Trustee and the Securities Administrator in its individual capacity or in
any capacity other than as Trustee hereunder may become the owner or pledgee of
any Certificates with the same rights it would have if it were not Trustee or
the Securities Administrator, as applicable, and may otherwise deal with the
parties hereto.

         Section 9.05 TRUSTEE'S AND SECURITIES ADMINISTRATOR'S FEES AND
EXPENSES. The fees and expenses of the Trustee and the Securities Administrator
shall be paid in accordance with a side letter agreement between the Trustee and
the Master Servicer. In addition, the Trustee and the Securities Administrator
will be entitled to recover from the Master Servicer Collection Account pursuant
to Section 4.03(b) all reasonable out-of-pocket expenses, disbursements and
advances and the expenses of the Trustee and the Securities Administrator,
respectively, 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) incurred or made by the Trustee or the Securities
Administrator, respectively, in the administration of the trusts hereunder
(including the reasonable compensation, expenses and disbursements of its
counsel) except any such expense, disbursement or advance as may arise from its
negligence or intentional misconduct or which is the responsibility of the
Certificateholders. If funds in the Master Servicer Collection Account are
insufficient therefor, the



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Trustee and the Securities Administrator shall recover such expenses from the
Seller. Such compensation and reimbursement obligation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust. Additionally, the Trustee and any director, officer, employee or agent of
the Trustee shall be indemnified by the Trust and held harmless against any
loss, liability or expense (including reasonable attorney's fees and expenses)
incurred in the administration of this Agreement (other than its ordinary out of
pocket expenses incurred hereunder) or in connection with any claim or legal
action relating to (a) this Agreement or (b) the Certificates, other than any
loss, liability or expense incurred by reason of its negligence or intentional
misconduct, or which is the responsibility of the Certificateholders. Such
indemnity shall survive the termination of this Agreement or the resignation or
removal of the Trustee hereunder.

         Section 9.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE AND SECURITIES
ADMINISTRATOR. The Trustee and any successor Trustee and the Securities
Administrator and any successor Securities Administrator shall during the entire
duration of this Agreement be a state bank or trust company or a national
banking association organized and doing business under the laws of such state or
the United States of America, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus and undivided profits of at
least $40,000,000 or, in the case of a successor Trustee, $50,000,000, subject
to supervision or examination by federal or state authority and, in the case of
the Trustee, rated "BBB" or higher by S&P with respect to their long-term rating
and rated "BBB" or higher by S&P and "Baa2" or higher by Moody's with respect to
any outstanding long-term unsecured unsubordinated debt, and, in the case of a
successor Trustee or successor Securities Administrator other than pursuant to
Section 9.10, rated in one of the two highest long- term debt categories of, or
otherwise acceptable to, each of the Rating Agencies. If the Trustee 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 9.06 the combined capital and surplus of such corporation shall be
deemed to be its total equity capital (combined capital and surplus) as set
forth in its most recent report of condition so published. In case at any time
the Trustee or the Securities Administrator shall cease to be eligible in
accordance with the provisions of this Section 9.06, the Trustee or the
Securities Administrator shall resign immediately in the manner and with the
effect specified in Section 9.08.

         Section 9.07 INSURANCE. The Trustee and the Securities Administrator,
at their own expense, shall at all times maintain and keep in full force and
effect: (i) fidelity insurance, (ii) theft of documents insurance and (iii)
forgery insurance (which may be collectively satisfied by a "Financial
Institution Bond" and/or a "Bankers' Blanket Bond"). All such insurance shall be
in amounts, with standard coverage and subject to deductibles, as are customary
for insurance typically maintained by banks or their affiliates which act as
custodians for investor-owned mortgage pools. A certificate of an officer of the
Trustee or the Securities Administrator as to the Trustee's or the Securities
Administrator's, respectively, compliance with this Section 9.07 shall be
furnished to any Certificateholder upon reasonable written request.




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         Section 9.08 RESIGNATION AND REMOVAL OF THE TRUSTEE AND SECURITIES
ADMINISTRATOR. (a) The Trustee and the Securities Administrator may at any time
resign and be discharged from the Trust hereby created by giving written notice
thereof to the Seller and the Master Servicer, with a copy to the Rating
Agencies. Upon receiving such notice of resignation, the Seller shall promptly
appoint a successor Trustee or successor Securities Administrator, as
applicable, by written instrument, in triplicate, one copy of which instrument
shall be delivered to each of the resigning Trustee or Securities Administrator,
as applicable, the successor Trustee or Securities Administrator, as applicable.
If no successor Trustee or Securities Administrator shall have been so appointed
and have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator may petition any
court of competent jurisdiction for the appointment of a successor Trustee or
Securities Administrator.

         (b) If at any time the Trustee or the Securities Administrator shall
cease to be eligible in accordance with the provisions of Section 9.06 and shall
fail to resign after written request therefor by the Seller or if at any time
the Trustee or the Securities Administrator shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or the
Securities Administrator, as applicable, or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or the
Securities Administrator, as applicable, or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then the Seller shall
promptly remove the Trustee, or shall be entitled to remove the Securities
Administrator, as applicable, and appoint a successor Trustee or Securities
Administrator, as applicable, by written instrument, in triplicate, one copy of
which instrument shall be delivered to each of the Trustee or Securities
Administrator, as applicable, so removed, the successor Trustee or Securities
Administrator, as applicable.

         (c) The Holders of Certificates evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust Fund may at any time remove
the Trustee or the Securities Administrator and simultaneously appoint a
successor Trustee or Securities Administrator by written instrument or
instruments, in quadruplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to the
Seller, the Master Servicer, the Securities Administrator (if the Trustee is
removed), the Trustee (if the Securities Administrator is removed), and the
Trustee or Securities Administrator so removed and the successor so appointed.
In the event that the Trustee or Securities Administrator is removed by the
Holders of Certificates in accordance with this Section 9.08(c), the Holders of
such Certificates shall be responsible for paying any compensation payable to a
successor Trustee or successor Securities Administrator, in excess of the amount
paid to the predecessor Trustee or predecessor Securities Administrator, as
applicable.

         (d) No resignation or removal of the Trustee or the Securities
Administrator and appointment of a successor Trustee or Securities Administrator
pursuant to any of the provisions of this Section 9.08 shall become effective
except upon appointment of and acceptance of such appointment by the successor
Trustee or Securities Administrator as provided in Section 9.09.




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         Section 9.09 SUCCESSOR TRUSTEE AND SUCCESSOR SECURITIES ADMINISTRATOR.
(a) Any successor Trustee or Securities Administrator appointed as provided in
Section 9.08 shall execute, acknowledge and deliver to the Seller and to its
predecessor Trustee or Securities Administrator an instrument accepting such
appointment hereunder. The resignation or removal of the predecessor Trustee or
Securities Administrator shall then become effective and such successor Trustee
or Securities Administrator, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as Trustee or
Securities Administrator herein. The predecessor Trustee or Securities
Administrator shall after payment of its outstanding fees and expenses promptly
deliver to the successor Trustee or Securities Administrator, as applicable, all
assets and records of the Trust held by it hereunder, and the Seller and the
predecessor Trustee or Securities Administrator, as applicable, shall execute
and deliver such instruments and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in the successor
Trustee or Securities Administrator, as applicable, all such rights, powers,
duties and obligations.

         (b) No successor Trustee or Securities Administrator shall accept
appointment as provided in this Section 9.09 unless at the time of such
acceptance such successor Trustee or Securities Administrator shall be eligible
under the provisions of Section 9.06.

         (c) Upon acceptance of appointment by a successor Trustee or Securities
Administrator as provided in this Section 9.09, the successor Trustee or
Securities Administrator shall mail notice of the succession of such Trustee or
Securities Administrator hereunder to all Certificateholders at their addresses
as shown in the Certificate Register and to the Rating Agencies. EMC shall pay
the cost of any mailing by the successor Trustee or Securities Administrator.

         Section 9.10 MERGER OR CONSOLIDATION OF TRUSTEE OR SECURITIES
ADMINISTRATOR. Any state bank or trust company or national banking association
into which the Trustee or the Securities Administrator 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 or the Securities Administrator,
respectively, shall be a party, or any state bank or trust company or national
banking association succeeding to all or substantially all of the corporate
trust business of the Trustee or the Securities Administrator, respectively,
shall be the successor of the Trustee or the Securities Administrator,
respectively, hereunder, provided such state bank or trust company or national
banking association shall be eligible under the provisions of Section 9.06. Such
succession shall be valid without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.

         Section 9.11 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. (a)
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 or property constituting the same may at the time be located, the Seller
and the Trustee acting jointly, at the expense of the Trust, shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee and the Seller 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, and to vest in such Person or Persons, in such
capacity, such title to the Trust, or any part thereof, and, subject to the
other provisions of this



                                     -123-
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Section 9.11, such powers, duties, obligations, rights and trusts as the Seller
and the Trustee may consider necessary or desirable.

         (b) If the Seller shall not have joined in such appointment within 15
days after the receipt by it of a written request so to do, the Trustee shall
have the power to make such appointment without the Seller.

         (c) No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor Trustee under Section 9.06
hereunder and no notice to Certificateholders of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.

         (d) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee and required to be conferred on 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 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.

         (e) 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 IX. 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.

         (f) To the extent not prohibited by law, any separate trustee or
co-trustee may, at any time, request the Trustee, its agent or attorney-in-fact,
with full power and authority, to do any lawful act under or with respect to
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.

         (g) No trustee under this Agreement shall be personally liable by
reason of any act or omission of another trustee under this Agreement. The
Seller and the Trustee acting jointly may at any time accept the resignation of
or remove any separate trustee or co-trustee.




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         Section 9.12 FEDERAL INFORMATION RETURNS AND REPORTS TO
CERTIFICATEHOLDERS; REMIC ADMINISTRATION. (a) For federal income tax purposes,
the taxable year of each REMIC shall be a calendar year and the Securities
Administrator shall maintain or cause the maintenance of the books of each such
REMIC on the accrual method of accounting.

         (b) The Securities Administrator shall prepare and file or cause to be
filed with the Internal Revenue Service, and the Trustee shall sign, Federal tax
information returns or elections required to be made hereunder with respect to
each REMIC, the Trust Fund, if applicable, and the Certificates containing such
information and at the times and in the manner as may be required by the Code or
applicable Treasury regulations, and shall furnish to each Holder of
Certificates at any time during the calendar year for which such returns or
reports are made such statements or information at the times and in the manner
as may be required thereby, including, without limitation, reports relating to
interest, original issue discount and market discount or premium (using a
constant prepayment assumption of 25% CPR). The Securities Administrator will
apply for an Employee Identification Number from the IRS under Form SS-4 or any
other acceptable method for all tax entities. In connection with the foregoing,
the Securities Administrator shall timely prepare and file, and the Trustee
shall sign, IRS Form 8811, which shall provide the name and address of the
person who can be contacted to obtain information required to be reported to the
holders of regular interests in each REMIC (the "REMIC Reporting Agent"). The
Trustee is hereby directed to make elections to treat each REMIC as a REMIC
(which elections shall apply to the taxable period ending December 31, 2003 and
each calendar year thereafter) in such manner as the Code or applicable Treasury
regulations may prescribe, and as described by the Securities Administrator. The
Trustee shall sign all tax information returns to be filed pursuant to this
Section and any other returns as may be required by the Code and prepared by the
Securities Administrator. The Holder of the Class R-I Certificate is hereby
designated as the "Tax Matters Person" (within the meaning of Treas. Reg.
ss.ss.1.860F-4(d)) for REMIC I, the Holder of the Class R-II Certificate is
hereby designated as the "Tax Matters Person" for REMIC II, the Holder of the
Class R-III Certificate is hereby designated as the "Tax Matters Person" for
REMIC III and the Holder of the Class R-IV Certificate is hereby designated as
the "Tax Matters Person" for REMIC IV. The Securities Administrator is hereby
designated and appointed as the agent of each such Tax Matters Person. Any
Holder of a Residual Certificate will by acceptance thereof appoint the
Securities Administrator as agent and attorney-in- fact for the purpose of
acting as Tax Matters Person for each REMIC during such time as the Securities
Administrator does not own any such Residual Certificate. In the event that the
Code or applicable Treasury regulations prohibit the Trustee from signing tax or
information returns or other statements, or the Securities Administrator from
acting as agent for the Tax Matters Person, the Trustee and the Securities
Administrator shall take whatever action that in its sole good faith judgment is
necessary for the proper filing of such information returns or for the provision
of a tax matters person, including designation of the Holder of a Residual
Certificate to sign such returns or act as tax matters person. Each Holder of a
Residual Certificate shall be bound by this Section.

         (c) The Securities Administrator shall provide upon request and receipt
of reasonable compensation, such information as required in Section
860D(a)(6)(B) of the Code to the Internal Revenue Service, to any Person
purporting to transfer a Residual Certificate to a Person other than a
transferee permitted by Section 5.05(b), and to any regulated investment
company, real estate investment trust, common trust fund, partnership, trust,
estate, organization described in Section 1381 of the Code, or nominee holding
an interest in a pass-through entity described in Section



                                     -125-
<PAGE>



860E(e)(6) of the Code, any record holder of which is not a transferee permitted
by Section 5.05(b) (or which is deemed by statute to be an entity with a
disqualified member).

         (d) The Securities Administrator shall prepare and file or cause to be
filed, and the Trustee shall sign, any state income tax returns required under
Applicable State Law with respect to each REMIC or the Trust Fund.

         (e) Notwithstanding any other provision of this Agreement, the Trustee
and the Securities Administrator shall comply with all federal withholding
requirements respecting payments to Certificateholders of interest or original
issue discount on the Mortgage Loans, that the Trustee or the Securities
Administrator reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee or the Securities Administrator withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee or the Securities
Administrator shall, together with its monthly report to such
Certificateholders, indicate such amount withheld.

         (f) The Trustee and the Securities Administrator agree to indemnify the
Trust Fund and the Seller for any taxes and costs including, without limitation,
any reasonable attorneys fees imposed on or incurred by the Trust Fund, the
Seller or the Master Servicer, as a result of a breach of the Trustee's
covenants and the Securities Administrator's covenants, respectively, set forth
in this Section 9.12; provided, however, such liability and obligation to
indemnify in this paragraph shall not be joint and several and neither the
Trustee nor the Securities Administrator shall be liable or be obligated to
indemnify the Trust Fund for the failure by the other to perform any duty under
this Agreement or the breach by the other of any covenant in this Agreement.



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                                    ARTICLE X
                                   Termination

         Section 10.01 TERMINATION UPON REPURCHASE BY THE SELLER OR ITS DESIGNEE
OR LIQUIDATION OF THE MORTGAGE LOANS.

         (a) Subject to Section 10.02, the respective obligations and
responsibilities of the Seller, the Trustee, the Master Servicer and the
Securities Administrator created hereby, other than the obligation of the
Trustee to make payments to Certificateholders as hereinafter set forth shall
terminate upon:

                  (i) the repurchase by or at the direction of the Seller or its
         designee of all of the Group I Mortgage Loans and all related REO
         Property remaining in the Trust relating to such Group I Mortgage Loans
         and/or all of the Group II Mortgage Loans and all related REO Property
         remaining in the Trust relating to such Group II Mortgage Loans at a
         price (in each case, the "Termination Purchase Price") equal to the sum
         of (a) 100% of the Outstanding Principal Balance of each Mortgage Loan
         (other than a Mortgage Loan related to REO Property) as of the date of
         repurchase, net of the principal portion of any unreimbursed Monthly
         Advances made by the purchaser, together with interest at the
         applicable Mortgage Interest Rate accrued but unpaid to, but not
         including, the first day of the month of repurchase, (b) the appraised
         value of any related REO Property, less the good faith estimate of the
         Seller of liquidation expenses to be incurred in connection with its
         disposal thereof (but not more than the Outstanding Principal Balance
         of the related Mortgage Loan, together with interest at the applicable
         Mortgage Interest Rate accrued on that balance but unpaid to, but not
         including, the first day of the month of repurchase), such appraisal to
         be calculated by an appraiser mutually agreed upon by the Seller and
         the Securities Administrator at the expense of the Seller, (c)
         unreimbursed out-of pocket costs of the Master Servicer, including
         unreimbursed servicing advances and the principal portion of any
         unreimbursed Monthly Advances, made on the Mortgage Loans prior to the
         exercise of such repurchase right and (d) any unreimbursed costs and
         expenses of the Trustee and the Securities Administrator payable
         pursuant to Section 9.05; or

                  (ii) the later of the making of the final payment or other
         liquidation, or any advance with respect thereto, of the last Group I
         Mortgage Loan or Group II Mortgage Loan, as applicable, remaining in
         the Trust Fund or the disposition of all property acquired with respect
         to any Group I Mortgage Loan or Group II Mortgage Loan; provided,
         however, that in the event that an advance has been made, but not yet
         recovered, at the time of such termination, the Person having made such
         advance shall be entitled to receive, notwithstanding such termination,
         any payments received subsequent thereto with respect to which such
         advance was made; or

                  (iii) the payment to Certificateholders of all amounts
         required to be paid to them pursuant to this Agreement.




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         (b) In no event, however, shall the Trust created hereby continue
beyond the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late Ambassador of the United States to
the Court of St. James's, living on the date of this Agreement.

         (c) (i) The right of the Seller or its designee to repurchase all the
assets of the Trust Fund relating to Loan Group I Mortgage Loans, as described
in Subsection 10.01(a)(i) above is conditioned upon the date of such purchase
occurring after the Group I Optional Termination Date. The Seller or its
designee may repurchase all the assets of the Trust Fund relating to the Group I
Mortgage Loans if the Seller, based upon an Opinion of Counsel addressed to the
Seller, the Trustee and the Securities Administrator, has determined that the
REMIC status of REMIC I has been lost or that a substantial risk exists that
such REMIC status will be lost for the then-current taxable year. (ii) The right
of the Seller or its designee to repurchase all the assets of the Trust Fund
relating to the Group II Mortgage Loans described in Subsection 10.01(a)(i)
above is conditioned upon the date of such purchase occurring on or after the
Group II Optional Termination Date. The Seller or its designee may repurchase
all the assets of the Trust Fund relating to the Group II Mortgage Loans if the
Seller, based upon an Opinion of Counsel addressed to the Seller, the Trustee
and the Securities Administrator, has determined that the REMIC status of REMIC
II has been lost or that a substantial risk exists that such REMIC status will
be lost for the then-current taxable year. (iii) At any time thereafter, in the
case of a repurchase as described in this Subsection 10.01(c), the Seller may
elect to terminate REMIC I, REMIC II, REMIC III and REMIC IV at any time, and
upon such election, the Seller or its designee, shall repurchase all the assets
of the Trust Fund described in Subsection 10.01(a)(i) above.

         (d) The Trustee shall give notice of any termination to the
Certificateholders, with a copy to the Master Servicer, the Securities
Administrator and the Rating Agencies, upon which the Certificateholders shall
surrender their Certificates to the Trustee for payment of the final
distribution and cancellation. Such notice shall be given by letter, mailed not
earlier than the l5th day and not later than the 25th day of the month next
preceding the month of such final distribution, and shall specify (i) the
Distribution Date upon which final payment of the Certificates will be made upon
presentation and surrender of the Certificates at the office of the Trustee
therein designated, (ii) the amount of any such final payment 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.

         (e) If the option of the Seller to repurchase or cause the repurchase
of all the assets in the Trust Fund relating to either Loan Group I or Loan
Group II, as described in Subsection 10.01(a)(i), above is exercised, the Seller
and/or its designee shall deliver to the Trustee for deposit in the Distribution
Account, by the Business Day prior to the applicable Distribution Date, an
amount equal to the Termination Purchase Price for the Mortgage Loans being
purchased by it and all property acquired with respect to such Mortgage Loans
being purchased by it and all property acquired with respect to such Mortgage
Loans remaining in REMIC I or REMIC II, as applicable. Upon presentation and
surrender of the Certificates by the Certificateholders, the Trustee shall
distribute to the Certificateholders as directed by the Securities Administrator
in writing an amount determined as follows: with respect to each Certificate
(other than the Class R Certificates), the outstanding Current Principal Amount,
plus with respect to each Certificate (other than the Class R Certificates and
the Principal Only Certificates), one month's interest thereon at the applicable


                                     -128-
<PAGE>


Pass-Through Rate; 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 Certificates (other than the Class R Certificates).If the
proceeds with respect to the Group I Mortgage Loans are not sufficient to pay
all of the Group I Senior Certificates in full, any such deficiency will be
allocated first, to the Group I Subordinate Certificates, in inverse order of
their numerical designation and then to the Group I Senior Certificates on a pro
rata basis. If the proceeds with respect to the Group II Mortgage Loans are not
sufficient to pay all of the Group II Senior Certificates in full, any such
deficiency will be allocated first, to the Group II Subordinate Certificates, in
inverse order of their numerical designation and then to the Group II Senior
Certificates on a pro rata basis. Upon deposit of the required repurchase price
and following such final Distribution Date, the Trustee shall release promptly
to the Seller and/or its designee the Mortgage Files for the remaining
applicable Mortgage Loans of the related Mortgage Loan Group, and the Accounts
with respect thereto shall terminate, subject to the Trustee's obligation to
hold any amounts payable to Certificateholders in trust without interest pending
final distributions pursuant to Subsection 10.01(g). Any other amounts remaining
in the Accounts will belong to the Seller. Upon deposit of the Termination
Purchase Price and following such final Distribution Date, the Trustee shall
release promptly to the Seller and/or its designee, as the case may be, the
Mortgage Files for the remaining Mortgage Loans, and the Accounts with respect
thereto shall terminate, subject to the Trustee's obligation to hold any amounts
payable to Certificateholders in trust without interest pending final
distributions pursuant to Subsection 10.01(g).

         (f) In the event that this Agreement is terminated by reason of the
payment or liquidation of all Mortgage Loans or the disposition of all property
acquired with respect to all Mortgage Loans under Subsection 10.01(a)(ii) above,
the Master Servicer shall deliver to the Trustee for deposit in the Distribution
Account all distributable amounts remaining in the Master Servicer Collection
Account. Upon the presentation and surrender of the Certificates, the Trustee
shall distribute to the remaining Certificateholders, pursuant to the written
direction of the Securities Administrator and in accordance with their
respective interests, all distributable amounts remaining in the Distribution
Account. Upon deposit by the Master Servicer of such distributable amounts, and
following such final Distribution Date, the Trustee shall release promptly to
the Seller or its designee the Mortgage Files for the remaining Mortgage Loans,
and the Master Servicer Collection Account and the Distribution Account shall
terminate, subject to the Trustee's obligation to hold any amounts payable to
the Certificateholders in trust without interest pending final distributions
pursuant to this Subsection 10.01(f).

         (g) If not all of the Certificateholders shall surrender their
Certificates for cancellation within six months after the time specified in the
above-mentioned written notice, the Trustee shall give a second written 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, not all the Certificates shall have been
surrendered for cancellation, the Trustee may take appropriate steps, or appoint
any agent to take appropriate 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 to this Agreement.




                                     -129-
<PAGE>



         Section 10.02 ADDITIONAL TERMINATION REQUIREMENTS. (a) If the option of
the Seller to repurchase (i) all the Group I Mortgage Loans and REMIC I, (ii)
all of the Group II Mortgage Loans and REMIC II or (iii) all of the Mortgage
Loans under Subsection 10.01(a)(i) above is exercised, (i) REMIC I, (ii) REMIC
II, or (iii) the Trust Fund and each of REMIC I, REMIC II , REMIC III and REMIC
IV shall be terminated in accordance with the following additional requirements,
unless the Trustee has been furnished with an Opinion of Counsel to the effect
that the failure of the Trust to comply with the requirements of this Section
10.02 will not (i) result in the imposition of taxes on "prohibited
transactions" as defined in Section 860F of the Code on REMIC I, REMIC II, REMIC
III or REMIC IV or (ii) cause any REMIC to fail to qualify as a REMIC at any
time that any Regular Certificates are outstanding:

                  (i) within 90 days prior to the final Distribution Date, at
         the written direction of the Seller, the Trustee, as agent for the
         respective Tax Matters Persons, shall adopt a plan of complete
         liquidation of each REMIC in the case of a termination of Loan Group I
         and Loan Group II under Subsection 10.01(a)(i), or a plan of complete
         liquidation of REMIC I in the case of a termination of Loan Group I
         under Subsection 10.01(a)(i), or a plan of complete liquidation of
         REMIC II in the case of a termination of Loan Group II under Subsection
         10.01(a)(ii), provided to it by the Seller, which the Seller has
         determined meets the requirements of a "qualified liquidation" under
         Section 860F of the Code and any regulations thereunder.

                  (ii) the Seller 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
         as directed by the Seller in accordance with the terms hereof; and

                  (iii) at or after the time of adoption of such a plan of
         complete liquidation of each REMIC, of REMIC I or of REMIC II, as
         applicable, and at or prior to the final Distribution Date relating
         thereto, the Trustee shall sell for cash all of the assets of the Trust
         or REMIC I or REMIC II, as applicable, to or at the direction of the
         Seller, and each of REMIC I, REMIC II, REMIC III and REMIC IV, as
         applicable, shall terminate at such time.

         (b) By their acceptance of the Residual Certificates, the Holders
thereof hereby (i) agree to adopt such a plan of complete liquidation of the
related REMIC upon the written request of the Seller, and to take such action in
connection therewith as may be reasonably requested by the Seller and (ii)
appoint the Seller as their attorney-in-fact, with full power of substitution,
for purposes of adopting such a plan of complete liquidation. The Securities
Administrator, in accordance with its duties under Section 9.12(d), will attach
a statement to each REMIC's final tax return specifying the first day in the
90-day liquidation period, pursuant to Treasury Regulations Section 1.860F-1.
Upon complete liquidation or final distribution of all of the assets of the
Trust Fund, the Trust Fund and each REMIC shall terminate.




                                     -130-
<PAGE>



                                   ARTICLE XI
                            Miscellaneous Provisions

         Section 11.01 INTENT OF PARTIES. The parties intend that each of REMIC
I, REMIC II, REMIC III and REMIC IV shall be treated as a REMIC for federal
income tax purposes and that the provisions of this Agreement should be
construed in furtherance of this intent.

         Section 11.02 AMENDMENT. (a) This Agreement may be amended from time to
time by EMC, the Seller, the Master Servicer, the Securities Administrator and
the Trustee, and the Servicing Agreements and Sub-Master Servicing Agreements
may be amended from time to time by EMC, the Master Servicer and the Trustee,
without notice to or the consent of any of the Certificateholders, to cure any
ambiguity, to correct or supplement any provisions herein or therein that may be
defective or inconsistent with any other provisions herein or therein, to comply
with any changes in the Code or to make any other provisions with respect to
matters or questions arising under this Agreement which shall not be
inconsistent with the provisions of this Agreement; provided, however, that such
action shall not, as evidenced by an Opinion of Independent Counsel, addressed
to the Trustee, adversely affect in any material respect the interests of any
Certificateholder.

         (b) This Agreement may also be amended from time to time by EMC, the
Master Servicer, the Seller, the Securities Administrator and the Trustee, and
the Servicing Agreements and Sub-Master Servicing Agreements may also be amended
from time to time by the Master Servicer and the Trustee, with the consent of
the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust Fund or of the applicable Class or
Classes, if such amendment affects only such Class or Classes, 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
Certificateholders; 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) 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, or (iii) cause any REMIC to fail to qualify as a REMIC for federal
income tax purposes, as evidenced by an Opinion of Independent Counsel addressed
to the Trustee which shall be provided to the Trustee other than at the
Trustee's expense. Notwithstanding any other provision of this Agreement, for
purposes of the giving or withholding of consents pursuant to this Section
11.02(b), Certificates registered in the name of or held for the benefit of the
Seller, the Securities Administrator, the Master Servicer, or the Trustee or any
Affiliate thereof shall be entitled to vote their Fractional Undivided Interests
with respect to matters affecting such Certificates.

         (c) Promptly after the execution of any such amendment, the Trustee
shall furnish a copy of such amendment or written notification of the substance
of such amendment to each Certificateholder, with a copy to the Rating Agencies.

         (d) In the case of an amendment under Subsection 11.02(b) above, it
shall not be necessary for the Certificateholders to approve the particular form
of such an amendment. Rather, it shall be sufficient if the Certificateholders
approve the substance of the amendment. The manner



                                     -131-
<PAGE>



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.

         (e) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel
addressed to the Trustee stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee and the Securities
Administrator may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's or the Securities Administrator's own respective
rights, duties or immunities under this Agreement.

         Section 11.03 RECORDATION OF AGREEMENT. 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 Mortgaged Properties are situated, and
in any other appropriate public recording office or elsewhere. The Seller shall
effect such recordation, at the expense of the Trust upon the request in writing
of a Certificateholder, but only if such direction is accompanied by an Opinion
of Counsel (provided at the expense of the Certificateholder requesting
recordation) to the effect that such recordation would materially and
beneficially affect the interests of the Certificateholders or is required by
law.

         Section 11.04 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. (a) The death
or incapacity of any Certificateholder shall not terminate this Agreement or the
Trust, nor entitle such Certificateholder's legal representatives or heirs to
claim an accounting or to take any action or proceeding in any court for a
partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.

         (b) Except as expressly provided in this Agreement, no
Certificateholders shall have any right to vote or in any manner otherwise
control the operation and management of the Trust, 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 establish the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholders be under any liability to any third Person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.

         (c) 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, under or with respect to this Agreement against the
Seller, the Securities Administrator, the Master Servicer or any successor to
any such parties unless (i) such Certificateholder previously shall have given
to the Trustee a written notice of a continuing default, as herein provided,
(ii) the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust Fund 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 and expenses and liabilities to be
incurred therein or thereby, and (iii) 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.



                                     -132-
<PAGE>


         (d) No one or more Certificateholders shall have any right by virtue of
any provision of this Agreement to affect the rights of any other
Certificateholders or to obtain or seek to obtain priority or preference over
any other such Certificateholder, 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 11.04, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.

         Section 11.05 ACTS OF CERTIFICATEHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Agreement to be given or taken by Certificateholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Certificateholders in person or by an agent duly appointed in writing.
Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is expressly required, to the Seller. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and conclusive in favor of the Trustee and the Seller,
if made in the manner provided in this Section 11.05.

         (b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the individual executing the same,
may also be proved in any other manner which the Trustee deems sufficient.

         (c) The ownership of Certificates (notwithstanding any notation of
ownership or other writing on such Certificates, except an endorsement in
accordance with Section 5.02 made on a Certificate presented in accordance with
Section 5.04) shall be proved by the Certificate Register, and neither the
Trustee, the Securities Administrator, the Seller, the Master Servicer nor any
successor to any such parties shall be affected by any notice to the contrary.

         (d) Any request, demand, authorization, direction, notice, consent,
waiver or other action of the holder of any Certificate shall bind every future
holder of the same Certificate and the holder of every Certificate issued upon
the registration of transfer or exchange thereof, if applicable, or in lieu
thereof with respect to anything done, omitted or suffered to be done by the
Trustee, the Securities Administrator, the Seller, the Master Servicer or any
successor to any such party in reliance thereon, whether or not notation of such
action is made upon such Certificates.

         (e) In determining whether the Holders of the requisite percentage of
Certificates evidencing Fractional Undivided Interests have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
Certificates owned by the Trustee, the Securities Administrator, the Seller, the
Master Servicer or any Affiliate thereof shall be disregarded, except as
otherwise provided in Section 11.02(b) and except that, in determining whether
the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or



                                     -133-
<PAGE>


waiver, only Certificates which a Responsible Officer of the Trustee actually
knows to be so owned shall be so disregarded. Certificates which have been
pledged in good faith to the Trustee, the Securities Administrator, the Seller,
the Master Servicer or any Affiliate thereof may be regarded as outstanding if
the pledgor establishes to the satisfaction of the Trustee the pledgor's right
to act with respect to such Certificates and that the pledgor is not an
Affiliate of the Trustee, the Securities Administrator, the Seller, or the
Master Servicer, as the case may be.

         Section 11.06 GOVERNING LAW. THIS AGREEMENT AND THE CERTIFICATES SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO ITS CONFLICT OF LAWS RULES (OTHER THAN SECTION 5- 1401 OF THE
GENERAL OBLIGATIONS LAW, WHICH THE PARTIES HERETO EXPRESSLY RELY UPON IN THE
CHOICE OF SUCH LAW AS THE GOVERNING LAW HEREUNDER) AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.

         Section 11.07 NOTICES. All demands and notices hereunder shall be in
writing and shall be deemed given when delivered at (including delivery by
facsimile) or mailed by registered mail, return receipt requested, postage
prepaid, or by recognized overnight courier, to (i) in the case of the Seller,
383 Madison Avenue, New York, New York 10179, Attention: Vice
President-Servicing, telecopier number: (212) 272-5591, or to such other address
as may hereafter be furnished to the other parties hereto in writing; (ii) in
the case of the Trustee, at its Corporate Trust Office, or such other address as
may hereafter be furnished to the other parties hereto in writing; (iii) in the
case of the EMC, 383 Madison Avenue, New York, New York 10179, Attention: Vice
President-Servicing, telecopier number: (212) 272-5591, or to such other address
as may hereafter be furnished to the other parties hereto in writing; (iv) in
the case of the Master Servicer or Securities Administrator, Wells Fargo Bank
Minnesota, National Association, P.O. Box 98, Columbia Maryland 21046 (or, in
the case of overnight deliveries, 9062 Old Annapolis Road, Columbia, Maryland
21045) (Attention: Corporate Trust Services - BART 2003-4), facsimile no.: (410)
715-2380, or such other address as may hereafter be furnished to the other
parties hereto in writing; or (v) in the case of the Rating Agencies, Moody's
Investors Service, Inc., 99 Church Street, New York, New York 10007 and Standard
& Poor's, a division of The McGraw-Hill Companies, Inc., 55 Water Street, New
York, New York 10041. Any notice delivered to the Seller, the Master Servicer,
the Securities Administrator or the Trustee under this Agreement shall be
effective only upon receipt. Any notice required or permitted to be mailed to a
Certificateholder, unless otherwise provided herein, shall be given by
first-class mail, postage prepaid, at the address of such Certificateholder as
shown in the Certificate Register. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given when mailed, whether or not the Certificateholder receives such notice.

         Section 11.08 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 severed 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.




                                     -134-
<PAGE>



         Section 11.09 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.

         Section 11.10 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 11.11 COUNTERPARTS. This Agreement may be executed in two or
more counterparts each of which when so executed and delivered shall be an
original but all of which together shall constitute one and the same instrument.

         Section 11.12 NOTICE TO RATING AGENCIES. The article and section
headings herein are for convenience of reference only, and shall not limited or
otherwise affect the meaning hereof. The Trustee shall promptly provide notice
to each Rating Agency with respect to each of the following of which a
Responsible Officer of the Trustee has actual knowledge:

         1. Any material change or amendment to this Agreement or the Servicing
Agreements;

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

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

         4. The repurchase or substitution of Mortgage Loans;

         5. The final payment to Certificateholders; and

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





                                     -135-
<PAGE>



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

                                            STRUCTURED ASSET MORTGAGE
                                            INVESTMENTS INC., as Seller


                                            By:/s/ Baron Silverstein
                                               ----------------------------
                                            Name: Baron Silverstein
                                            Title: Vice President


                                            DEUTSCHE BANK NATIONAL TRUST
                                            COMPANY, as Trustee


                                            By: /s/ Barbera Campbell
                                               ----------------------------
                                            Name: Barbera Campbell
                                            Title: Assistant Vice President

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

                                            WELLS FARGO BANK MINNESOTA,
                                            NATIONAL ASSOCIATION, as Master
                                            Servicer


                                            By: /s/ Stacey Wainwright
                                               ----------------------------
                                            Name: Stacey Wainwright
                                            Title: Assistant Vice President


                                            WELLS FARGO BANK MINNESOTA,
                                            NATIONAL ASSOCIATION, as Securities
                                            Administrator


                                            By:/s/ Stacey Wainwright
                                               ----------------------------
                                            Name: Stacey Wainwright
                                            Title: Assistant Vice President



<PAGE>


                                            EMC MORTGAGE CORPORATION


                                            By:/s/ Sherri Lauritson
                                               ----------------------------
                                            Name: Sherri Lauritson
                                            Title: Executive Vice President

Accepted and Agreed as to
Sections 2.01, 2.02, 2.03, 2.04
and 9.09(c) in its capacity as
Mortgage Loan Seller

EMC MORTGAGE CORPORATION


By:/s/ Sherri Lauritson
   ----------------------------
Name: Sherri Lauritson
Title: Executive Vice President





<PAGE>



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

         On the 30th day of June, 2003 before me, a notary public in and for
said State, personally appeared Baron Silverstein, known to me to be a(n) Vice
President of Structured Asset Mortgage Investments Inc., 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>



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

         On the 30th day of June, 2003 before me, a notary public in and for
said State, personally appeared __________________, known to me to be a(n)
____________________ of Deutsche Bank National Trust Company, the entity that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said entity, and acknowledged to me that such entity
executed the within instrument.

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


                                            ____________________________________

                                            Notary Public

[Notarial Seal]




<PAGE>



STATE OF MARYLAND   )
                    ) ss.:
COUNTY OF HOWARD    )

         On the 30th day of June, 2003 before me, a notary public in and for
said State, personally appeared Stacey Wainwright, known to me to be an
Assistant Vice President of Wells Fargo Bank Minnesota, National Association,
the entity that executed the within instrument, and also known to me to be the
person who executed it on behalf of said entity, and acknowledged to me that
such entity executed the within instrument.

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


                                            ____________________________________

                                            Notary Public

[Notarial Seal]




<PAGE>



STATE OF MARYLAND  )
                   ) ss.:
COUNTY OF  HOWARD  )

         On the 30th day of June, 2003 before me, a notary public in and for
said State, personally appeared Stacey Wainwright, known to me to be a(n)
Assistant Vice President of Wells Fargo Bank Minnesota, National Association,
the entity that executed the within instrument, and also known to me to be the
person who executed it on behalf of said entity, and acknowledged to me that
such entity executed the within instrument.

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


                                            ____________________________________

                                            Notary Public

[Notarial Seal]




<PAGE>



STATE OF TEXAS     )
                   ) ss.:
COUNTY OF DALLAS   )

         On the 30th day of June, 2003 before me, a notary public in and for
said State, personally appeared Sherri Lauritson, known to me to be Executive
Vice President of EMC Mortgage Corporation, 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>


STATE OF TEXAS      )
                    ) ss.:
COUNTY OF DALLAS    )

         On the 30th day of June, 2003 before me, a notary public in and for
said State, personally appeared__________________, known to me to
be______________________ of EMC Mortgage Corporation, 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

<PAGE>


                                                                     EXHIBIT A-1

              FORM OF CLASS [I-F_][I-S_][I-I_][II-A1] 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").

          [THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY
THE PRINCIPAL PAYMENTS HEREON [AND REALIZED LOSSES ALLOCABLE HERETO].
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.]

          UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED WILL BE REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT WILL BE MADE TO
CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY
OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS
AN INTEREST HEREIN.


                                       A-1

<PAGE>

<TABLE>
<CAPTION>

<S>                                                       <C>
Certificate No.1                                          Variable Pass-Through Rate

Class [I-F_][I-S_][I-I_][II-A1] Senior

Date of Pooling and Servicing Agreement and               Aggregate Initial Current [Principal] [Notional]
Cut-off Date:                                             Amount of this Senior Certificate as of the
June 1, 2003                                              Cut-off Date:
                                                          $[_____________]

First Distribution Date:                                  Initial Current [Principal][Notional] Amount of
July 25, 2003                                             this Senior Certificate as of the Cut-off Date:
                                                          $[_____________]

Master Servicer:
Wells Fargo Bank Minnesota, National
Association                                               CUSIP: [____________]

Assumed Final Distribution Date:
July 25, 2032
</TABLE>

              STRUCTURED ASSET MORTGAGE INVESTMENTS TRUST 2003-CL1
                        MORTGAGE PASS-THROUGH CERTIFICATE
                                 SERIES 2003-CL1

     evidencing a fractional undivided interest in the distributions allocable
     to the Class [I-F_][I-S_][I-I_][II-A1] Certificates with respect to a Trust
     Fund consisting primarily of a pool of seasoned fixed rate and adjustable
     rate mortgage loans secured by first liens on one-to-four family
     residential properties and sold by STRUCTURED ASSET MORTGAGE INVESTMENTS
     INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer or the Trustee referred to below or any of
their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity
or by Structured Asset Mortgage Investments Inc., the Master Servicer or the
Trustee or any of their affiliates or any other person. None of Structured Asset
Mortgage Investments Inc., 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
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") primarily consisting of seasoned adjustable rate and fixed rate
mortgage loans secured by first liens on one- to four- family residential
properties (collectively, the "Mortgage Loans") sold by Structured Asset
Mortgage Investments Inc. ("SAMI"). The


                                       A-2

<PAGE>



Mortgage Loans were sold by EMC Mortgage Corporation ("EMC") to SAMI. Wells
Fargo Bank Minnesota, National Association ("Wells Fargo") will act as master
servicer of the Mortgage Loans (the "Master Servicer," which term includes any
successors thereto under the Agreement referred to below). The Trust Fund was
created pursuant to the Pooling and Servicing Agreement dated as of the Cut-off
Date specified above (the "Agreement"), among SAMI, as seller (the "Seller"),
Wells Fargo Bank Minnesota, National Association as master servicer and
securities administrator, EMC Mortgage Corporation and Deutsche Bank National
Trust Company, as trustee (the "Trustee"), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
capitalized terms used herein shall have the meaning ascribed to them 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 its acceptance hereof assents and by which such
Holder is bound.

          Interest on this Certificate will accrue [In the case of the Class
[I-F_]and [I-S_]: beginning on the 25th day of the month preceding the month in
which the Distribution Date occurs and ending on the 24th day of the month in
which the Distribution Date] [In the case of the Class [I- I_] and [II-A1]:
during the month prior to the month in which a Distribution Date (as hereinafter
defined) occurs] on the Current Principal Amount hereof at a per annum rate
equal to the Pass- Through Rate set forth above and as further described in the
Agreement. The Trustee will distribute on the 25th day of each month, or, if
such 25th day is not a Business Day, the immediately following Business Day
(each, a "Distribution Date"), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered at
the close of business [In the case of the Class [I-I_] and [II-A1]: on the last
Business Day of the calendar month preceding the month of such Distribution
Date][In the case of the Class [I-F_]and [I-S_]: on the Business Day immediately
preceding such Distribution Date], an amount equal to the product of the
Fractional Undivided Interest evidenced by this Certificate and the amount (of
interest and principal, if any) required to be distributed to the Holders of
Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the Distribution Date in the month immediately following
the month of the latest scheduled maturity date of any Mortgage Loan and is not
likely to be the date on which the [Current Principal][Notional] Amount of this
Class of Certificates will be reduced to zero.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and designated in such notice. The
Initial [Current Principal][Notional] Amount of this Certificate is set forth
above. [The Current Principal Amount hereof will be reduced to the extent of
distributions allocable to principal hereon and any Realized Losses allocable
hereto.]

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
twenty-four Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.



                                       A-3

<PAGE>



          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

          The Agreement permits, with certain exceptions therein provided: (i)
the amendment thereof and the modification of the rights and obligations of the
Seller, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement from time to time by the parties thereto
with the consent of the Holders of Certificates, evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust Fund (or in certain cases,
Holders of Certificates of affected Classes evidencing such percentage of the
Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such consent is made upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Fractional Undivided Interest will
be issued to the designated transferee.

          The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Seller, the Master Servicer, the Trustee and any agent of any of
them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Seller, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of the (A) final payment or other liquidation (or Advance with
respect thereto) of the last Mortgage Loan remaining in the Trust Fund


                                       A-4

<PAGE>



and (B) disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan and the remittance of all funds due under the
Agreement, or (ii) the optional repurchase by the party named in the Agreement
of all the Mortgage Loans and other assets of the Trust Fund in accordance with
the terms of the Agreement. Such optional repurchase may be made only on or
after the Distribution Date on which the aggregate unpaid principal balance of
the Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the expiration of 21 years after the death of certain persons
identified in the Agreement.

          Unless this Certificate has been authenticated by an authorized
signatory of 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: June ___, 2003            DEUTSCHE BANK NATIONAL TRUST
                                 COMPANY
                                 Not in its individual capacity but solely as
                                 Trustee


                                 By:_________________________________________
                                          Authorized Signatory


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

          This is one of the Class [I-F_][I-S_][I-I_][II-A1] Certificates
referred to in the within- mentioned Agreement.

                                 DEUTSCHE BANK NATIONAL TRUST COMPANY
                                 Authorized signatory of Deutsche Bank National
                                 Trust Company, not in its individual capacity
                                 but solely as Trustee

                                 By:____________________________________________
                                              Authorized Signatory





<PAGE>



                                   ASSIGNMENT
                                   ----------

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Fractional Undivided
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




                            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.







<PAGE>



                                                                     EXHIBIT A-2

                        FORM OF CLASS [_-B_] CERTIFICATE

          THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR
CERTIFICATES, [AND THE 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").

          THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DECREASED BY
THE PRINCIPAL PAYMENTS HEREON AND ANY REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.

          UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, ANY CERTIFICATE ISSUED WILL BE REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT WILL BE MADE TO
CEDE & CO. ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.

          [FOR CLASS I-B4, CLASS I-B5, CLASS I-B6, CLASS II-B4, CLASS II-B5 AND
CLASS II-B6 CERTIFICATES][THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE




<PAGE>



SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN "INSTITUTIONAL
ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE 501(A)(1), (2), (3) OR
(7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY
OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION
OF THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY THE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE
TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER,
RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE JURISDICTION.]

     [FOR CLASS I-B1, CLASS I-B2, CLASS I-B3, CLASS I-B4, CLASS I-B5,CLASS
II-B1, CLASS II-B2, CLASS II-B3, CLASS II-B4 AND CLASS II-B5 CERTIFICATES] [THIS
CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE
I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION
4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, UNLESS THE PROPOSED
TRANSFEREE CERTIFIES OR REPRESENTS THAT ONE OF THE FOLLOWING STATEMENTS IS TRUE
(I) IT IS NOT A PLAN OR INVESTING WITH "PLAN ASSETS" OR (II) (1) IT IS AN
INSURANCE COMPANY, (2) THE SOURCE OF FUNDS USED TO ACQUIRE OR HOLD THIS
CERTIFICATE OR INTEREST HEREIN IS AN "INSURANCE COMPANY GENERAL ACCOUNT," AS
SUCH TERM IS DEFINED IN PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 95-60,
AND (3) THE CONDITIONS IN SECTIONS I AND III OF PTCE 95-60 HAVE BEEN SATISFIED,
WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A BOOK- ENTRY CERTIFICATE OR A
GLOBAL CERTIFICATE, OR UNLESS THE OPINION SPECIFIED IN SECTION 5.07 OF THE
AGREEMENT IS PROVIDED. ]

     [FOR CLASS I-B6 AND CLASS II-B6 CERTIFICATES][THIS CERTIFICATE MAY NOT BE
ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, UNLESS THE PROPOSED TRANSFEREE
CERTIFIES OR REPRESENTS THAT THE PROPOSED TRANSFER AND HOLDING OF A CERTIFICATE
AND THE SERVICING, MANAGEMENT AND OPERATION OF THE TRUST AND ITS ASSETS: (I)
WILL NOT RESULT IN ANY NON-EXEMPT PROHIBITED TRANSACTION AND (II) WILL NOT GIVE
RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON THE PART OF THE SELLER, THE
SECURITIES ADMINISTRATOR, THE MASTER SERVICER, ANY SUB-MASTER SERVICER, ANY
SERVICER OR THE TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A
BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE OR UNLESS THE OPINION SPECIFIED
IN SECTION 5.07 OF THE AGREEMENT IS PROVIDED.]


                                      A-2-2

<PAGE>

<TABLE>
<CAPTION>


<S>                                                       <C>
Certificate No.1                                          [Variable Pass-Through Rate][5.00%]

Class [_-B_] Subordinate

Date of Pooling and Servicing Agreement and               Aggregate Initial Current Principal Amount of
Cut-off Date: June 1, 2003                                this Subordinate Certificate as of the Cut-off
                                                          Date: $[_________]

First Distribution Date:                                  Initial Current Principal Amount of this
July 25, 2003                                             Subordinate Certificate as of the Cut-off Date:
                                                          $[_________]

Master Servicer:
Wells Fargo Bank Minnesota, National
Association                                               CUSIP: [____________]

Assumed Final Distribution Date:
July 25, 2032
</TABLE>

              STRUCTURED ASSET MORTGAGE INVESTMENTS TRUST 2003-CL1
                        MORTGAGE PASS-THROUGH CERTIFICATE
                                 SERIES 2003-CL1

     evidencing a fractional undivided interest in the distributions allocable
     to the Class [_-B_] Certificates with respect to a Trust Fund consisting
     primarily of a pool of seasoned fixed rate and adjustable rate mortgage
     loans secured by first liens on one- to-four family residential properties
     and sold by STRUCTURED ASSET MORTGAGE INVESTMENTS INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer or the Trustee referred to below or any of
their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity
or by Structured Asset Mortgage Investments Inc., the Master Servicer or the
Trustee or any of their affiliates or any other person. None of Structured Asset
Mortgage Investments Inc., 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.][Bear, Stearns Securities Corp.] is
the registered owner of the Fractional Undivided Interest evidenced hereby in
the beneficial ownership interest of Certificates of the same Class as this
Certificate in a trust (the "Trust Fund") primarily consisting of seasoned
adjustable rate and fixed rate mortgage loans secured by first liens on one- to
four- family residential properties (collectively, the "Mortgage Loans") sold by
Structured Asset Mortgage Investments Inc. ("SAMI"). The Mortgage Loans were
sold by EMC Mortgage Corporation


                                        2

<PAGE>



("EMC") to SAMI. Wells Fargo Bank Minnesota, National Association ("Wells
Fargo") will act as master servicer of the Mortgage Loans (the "Master
Servicer," which term includes any successors thereto under the Agreement
referred to below). The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement"), among SAMI, as seller (the "Seller"), Wells Fargo Bank Minnesota,
National Association as master servicer and securities administrator, EMC
Mortgage Corporation and Deutsche Bank National Trust Company, as trustee (the
"Trustee") , a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, capitalized terms used herein
shall have the meaning ascribed to them 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 its
acceptance hereof assents and by which such Holder is bound.

          Interest on this Certificate will accrue during the month prior to the
month in which a Distribution Date (as hereinafter defined) occurs on the
Current Principal Amount hereof at a per annum rate equal to the Pass-Through
Rate set forth above and as further described in the Agreement. The Trustee will
distribute on the 25th day of each month, or, if such 25th day is not a Business
Day, the immediately following Business Day (each, a "Distribution Date"),
commencing on the First Distribution Date specified above, to the Person in
whose name this Certificate is registered at the close of business on the last
Business Day of the calendar month preceding the month of such Distribution
Date, an amount equal to the product of the Fractional Undivided Interest
evidenced by this Certificate and the amount (of interest and principal, if any)
required to be distributed to the Holders of Certificates of the same Class as
this Certificate. The Assumed Final Distribution Date is the Distribution Date
in the month immediately following the month of the latest scheduled maturity
date of any Mortgage Loan and is not likely to be the date on which the Current
Principal Amount of this Class of Certificates will be reduced to zero.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register or, if such Person so requests by
notifying the Trustee in writing as specified in the Agreement by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and designated in such notice. The
Initial Current Principal Amount of this Certificate is set forth above. The
Current Principal Amount hereof will be reduced to the extent of distributions
allocable to principal hereon and any Realized Losses allocable hereto.

     [No transfer of this Class [_-B_] Certificate will be made unless such
transfer is (i) exempt from the registration requirements of the Securities Act
of 1933, as amended, and any applicable state securities laws or is made in
accordance with said Act and laws and (ii) made in accordance with Section 5.02
of the Agreement. In the event that such transfer is to be made the Trustee
shall register such transfer if, (i) made to a transferee who has provided the
Trustee with evidence as to its QIB status; or (ii) (A) the transferor has
advised the Trustee in writing that the Certificate is being transferred to an
Institutional Accredited Investor and (B) prior to such transfer the transferee
furnishes to the Trustee an Investment Letter; provided that if based upon an
Opinion of Counsel to the effect that (A) and (B) above are met sufficient to
confirm that such transfer is being made


                                        3

<PAGE>



pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and other applicable laws.]

     [For Class I-B1, Class I-B2, Class I-B3, Class I-B4, Class I-B5,Class
II-B1, Class II-B2, Class II-B3, Class II-B4 and Class II-B5 Certificates] [This
Certificate may not be acquired directly or indirectly by, or on behalf of, an
employee benefit plan or other retirement arrangement which is subject to Title
I of the Employee Retirement Income Security Act of 1974, as amended, or Section
4975 of the Internal Revenue Code of 1986, as amended, unless the proposed
transferee certifies or represents that one of the following statements is true
(i) it is not a Plan or investing with "Plan Assets" or (ii) (1) it is an
Insurance Company, (2) the source of funds used to acquire or hold this
Certificate or interest herein is an "Insurance Company General Account," as
such term is defined in Prohibited Transaction Class Exemption ("PTCE") 95-60,
and (3) the conditions in sections I and III of PTCE 95-60 have been satisfied,
which will be deemed represented by an owner of a Book- Entry Certificate or a
Global Certificate, or unless the opinion specified in section 5.07 of the
Agreement is provided.]

     [For Class I-B6 and Class II-B6 Certificates][This Certificate may not be
acquired directly or indirectly by, or on behalf of, an employee benefit plan or
other retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, or Section 4975 of the
Internal Revenue Code of 1986, as amended, unless the transferee certifies or
represents that the proposed transfer and holding of a Certificate and the
servicing, management and operation of the trust and its assets: (i) will not
result in any non-exempt prohibited transaction and (ii) will not give rise to
any additional obligations on the part of the Seller, the Securities
Administrator, the Master Servicer, any Sub-Master Servicer, any Servicer or the
Trustee, which will be deemed represented by an owner of a Book-Entry
Certificate or a Global Certificate or unless the opinion specified in section
5.07 of the Agreement is provided.]

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
twenty-four Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

          The Agreement permits, with certain exceptions therein provided: (i)
the amendment thereof and the modification of the rights and obligations of the
Seller, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement from time to time by the parties thereto
with the consent of the Holders of Certificates, evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust Fund (or in certain cases,
Holders of Certificates of


                                        4

<PAGE>



affected Classes evidencing such percentage of the Fractional Undivided
Interests thereof). 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 lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Fractional Undivided Interest will
be issued to the designated transferee.

          The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Seller, the Master Servicer, the Trustee and any agent of any of
them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Seller, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of the (A) final payment or other liquidation (or Advance with
respect thereto) of the last Mortgage Loan remaining in the Trust Fund and (B)
disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan and the remittance of all funds due under the
Agreement, or (ii) the optional repurchase by the party named in the Agreement
of all the Mortgage Loans and other assets of the Trust Fund in accordance with
the terms of the Agreement. Such optional repurchase may be made only on or
after the Distribution Date on which the aggregate unpaid principal balance of
the Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the expiration of 21 years after the death of certain persons
identified in the Agreement.

          Unless this Certificate has been authenticated by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.


                                        5

<PAGE>


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

Dated: June ___, 2003              DEUTSCHE BANK NATIONAL TRUST
                                   COMPANY
                                   Not in its individual capacity but solely as
                                   Trustee


                                   By:_________________________________________
                                            Authorized Signatory


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

          This is one of the Class [_-B_] Certificates referred to in the
within-mentioned Agreement.

                                 DEUTSCHE BANK NATIONAL TRUST COMPANY
                                 Authorized signatory of Deutsche Bank National
                                 Trust Company, not in its individual capacity
                                 but solely as Trustee

                                 By:__________________________________________
                                        Authorized Signatory





<PAGE>



                                   ASSIGNMENT
                                   ----------

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Fractional Undivided
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




                            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.







<PAGE>



                                                                     EXHIBIT A-3

                         FORM OF CLASS R-[_] CERTIFICATE

          THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED
STATES PERSON, A PUBLICLY TRADED PARTNERSHIP 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").

          THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
UNLESS THE PROPOSED TRANSFEREE PROVIDES THE TRUSTEE WITH AN OPINION OF COUNSEL
ADDRESSED TO THE TRUSTEE, MASTER SERVICER AND SECURITIES ADMINISTRATOR AND ON
WHICH THEY MAY RELY THAT IS SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE OF
CERTIFICATES ON BEHALF OF SUCH PERSON WILL NOT RESULT IN OR CONSTITUTE A
NONEXEMPT PROHIBITED TRANSACTION, IS PERMISSIBLE UNDER APPLICABLE LAW AND WILL
NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE PART OF THE SELLER, THE
MASTER SERVICER, THE SECURITIES ADMINISTRATOR OR THE TRUSTEE.

          ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
MADE ONLY IF THE PROPOSED TRANSFEREE OBTAINS THE PRIOR WRITTEN CONSENT OF
STRUCTURED ASSET MORTGAGE INVESTMENTS INC. AND THE SECURITIES ADMINISTRATOR AND
PROVIDES A TRANSFER AFFIDAVIT TO STRUCTURED ASSET MORTGAGE INVESTMENTS INC., THE
SECURITIES ADMINISTRATOR 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
DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER IS TO


                                      A-3-1

<PAGE>



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.




                                      A-3-2

<PAGE>


<TABLE>
<CAPTION>

<S>                                                      <C>
Certificate No.1

Class R-[_]

Date of Pooling and Servicing Agreement and               Aggregate Initial Current Principal Amount of
Cut-off Date: June 1, 2003                                this Certificate as of the Cut-off Date:
                                                          $___________

First Distribution Date:                                  Initial Current Principal Amount of this
July 27, 2003                                             Certificate as of the Cut-off Date: $_________

Master Servicer:
Wells Fargo Bank Minnesota, National
Association                                               CUSIP: [_____________]

Assumed Final Distribution Date:
July 25, 2032
</TABLE>

              STRUCTURED ASSET MORTGAGE INVESTMENTS TRUST 2003-CL1
                        MORTGAGE PASS-THROUGH CERTIFICATE
                                 SERIES 2003-CL1

     evidencing a fractional undivided interest in the distributions allocable
     to the Class R-[_] Certificates with respect to a Trust Fund consisting
     primarily of a pool of seasoned fixed rate and adjustable rate mortgage
     loans secured by first liens on one- to-four family residential properties
     and individual condominium units sold by STRUCTURED ASSET MORTGAGE
     INVESTMENTS INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer or the Trustee referred to below or any of
their affiliates or any other person. Neither this Certificate nor the
underlying Mortgage Loans are guaranteed or insured by any governmental entity
or by Structured Asset Mortgage Investments Inc., the Master Servicer or the
Trustee or any of their affiliates or any other person. None of Structured Asset
Mortgage Investments Inc., 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 Bear, Stearns Securities Corp. is the registered
owner of the Fractional Undivided Interest evidenced hereby in the beneficial
ownership interest of Certificates of the same Class as this Certificate in a
trust (the "Trust Fund") primarily consisting of adjustable rate mortgages loans
secured by first liens on one- to four- family residential properties
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments Inc. ("SAMI"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to SAMI. Wells Fargo Bank Minnesota, National Association
("Wells Fargo") will act as master servicer of the Mortgage Loans


                                        3

<PAGE>



(the "Master Servicer," which term includes any successors thereto under the
Agreement referred to below). The Trust Fund was created pursuant to the Pooling
and Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement'), among SAMI, as seller (the "Seller"), Wells Fargo Bank Minnesota,
National Association as master servicer and securities administrator, EMC
Mortgage Corporation and Deutsche Bank National Trust Company, as trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, capitalized terms used herein
shall have the meaning ascribed to them 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 its
acceptance hereof assents and by which such Holder is bound.

          The Trustee will distribute on the 25th day of each month, or, if such
25th day is not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount (of principal,
if any) required to be distributed to the Holders of Certificates of the same
Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.

          Distributions on this Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto as such name and address
shall appear on the Certificate Register, or if such Person so requests by
notifying the Trustee in writing as specified in the Agreement by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and designated in such notice. The
Initial Current Principal Amount of this Certificate is set forth above. The
Current Principal Amount hereof will be reduced to the extent of distributions
allocable to principal hereon and any Realized Losses allocable hereto.

          Each Holder of this Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
United States Person and a Permitted Transferee, (ii) the transfer of any
Ownership Interest in this Certificate will be conditioned upon the delivery to
SAMI, the Trustee and the Securities Administrator of, among other things, an
affidavit to the effect that it is a United States Person and Permitted
Transferee, (iii) 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, and (iv) if any
person other than a United States Person and a Permitted Transferee acquires any
Ownership Interest in this Certificate in violation of such restrictions, then
the Seller will have the right, in its sole discretion and without notice to the
Holder of this Certificate, to sell this Certificate to a purchaser selected by
the Seller, which purchaser may be the Seller, or any affiliate of the Seller,
on such terms and conditions as the Seller may choose.



                                        4

<PAGE>



          This certificate may not be acquired directly or indirectly by, or on
behalf of, an employee benefit plan or other retirement arrangement which is
subject to title I of the Employee Retirement Income Security Act of 1974, as
amended, and/or section 4975 of the Internal Revenue Code of 1986, as amended,
unless the proposed transferee provides the Trustee with an opinion of counsel
addressed to the Trustee, Master Servicer and the Securities Administrator and
on which they may rely(which shall not be at the expense of the Trustee, Master
Servicer or the Securities Administrator) which is acceptable to the Trustee,
that the purchase of this Certificate will not result in or constitute a
nonexempt prohibited transaction, is permissible under applicable law and will
not give rise to any additional fiduciary obligations on the part of the Seller,
the Master Servicer or the Trustee.

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
twenty-four Classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

          The Agreement permits, with certain exceptions therein provided: (i)
the amendment thereof and the modification of the rights and obligations of the
Seller, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement from time to time by the parties thereto
with the consent of the Holders of Certificates, evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust Fund (or in certain cases,
Holders of Certificates of affected Classes evidencing such percentage of the
Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such consent is made upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Fractional Undivided Interest will
be issued to the designated transferee.



                                        5

<PAGE>



          The Certificates are issuable only as registered Certificates without
coupons in the Classes and denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, this
Certificate is exchangeable for one or more new Certificates evidencing the same
Class and in the same aggregate Fractional Undivided Interest, as requested by
the Holder surrendering the same.

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Seller, the Master Servicer, the Trustee and any agent of any of
them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Seller, the Master Servicer, the
Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of the (A) final payment or other liquidation (or Advance with
respect thereto) of the last Mortgage Loan remaining in the Trust Fund and (B)
disposition of all property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan and the remittance of all funds due under the
Agreement, or (ii) the optional repurchase by the party named in the Agreement
of all the Mortgage Loans and other assets of the Trust Fund in accordance with
the terms of the Agreement. Such optional repurchase may be made only on or
after the Distribution Date on which the aggregate unpaid principal balance of
the Mortgage Loans is less than the percentage of the aggregate Outstanding
Principal Balance specified in the Agreement of the Mortgage Loans at the
Cut-off Date. The exercise of such right will effect the early retirement of the
Certificates. In no event, however, will the Trust Fund created by the Agreement
continue beyond the expiration of 21 years after the death of certain persons
identified in the Agreement.

          Unless this Certificate has been authenticated by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.



                                        6

<PAGE>



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

Dated: June ___, 2003              DEUTSCHE BANK NATIONAL TRUST
                                   COMPANY
                                   Not in its individual capacity but solely as
                                   Trustee


                                   By:_________________________________________
                                            Authorized Signatory


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

          This is one of the Class R-[_] Certificates referred to in the
within-mentioned Agreement.

                                 DEUTSCHE BANK NATIONAL TRUST COMPANY
                                 Authorized signatory of Deutsche Bank National
                                 Trust Company, not in its individual capacity
                                 but solely as Trustee

                                 By:___________________________________________
                                           Authorized Signatory





<PAGE>



                                   ASSIGNMENT
                                   ----------

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Fractional Undivided
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




                            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.









<PAGE>



                                                                     EXHIBIT A-4

                         FORM OF CLASS I-PO 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").

          THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE
PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE
PRINCIPAL BALANCE BY INQUIRY OF THE TRUSTEE NAMED HEREIN.

          UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.




<PAGE>

<TABLE>
<CAPTION>


<S>                                                       <C>
Certificate No.1                                          Pass-Through Rate: 0.00%

Class I-PO Senior

Date of Pooling and Servicing Agreement and               Aggregate Initial Current Principal Amount of
Cut-off Date:                                             this Certificate as of the Cut-off Date:
June 1, 2003                                              [____________]

First Distribution Date:                                  Initial Current Principal Amount of this
July 25, 2003                                             Certificate as of the Cut-off Date:
                                                          [____________]

Master Servicer:
Wells Fargo Bank Minnesota, National
Association                                               CUSIP: [____________]

Assumed Final Distribution Date:
July 25, 2032
</TABLE>

              STRUCTURED ASSET MORTGAGE INVESTMENTS TRUST 2003-CL1
                        MORTGAGE PASS-THROUGH CERTIFICATE
                                 SERIES 2003-CL1

     evidencing a fractional undivided interest in the distributions allocable
     to the Class I-PO Certificates with respect to a Trust Fund consisting
     primarily of a pool of seasoned fixed rate and adjustable rate mortgage
     loans secured by first liens on one- to-four family residential properties
     sold by STRUCTURED ASSET MORTGAGE INVESTMENTS INC.

          This Certificate is payable solely from the assets of the Trust Fund,
and does not represent an obligation of or interest in Structured Asset Mortgage
Investments Inc., the Master Servicer, the Trustee or the Securities
Administrator referred to below or any of their affiliates or any other person.
Neither this Certificate nor the underlying Mortgage Loans are guaranteed or
insured by any governmental entity or by Structured Asset Mortgage Investments,
Inc., the Master Servicer, the Trustee or the Securities Administrator or any of
their affiliates or any other person. None of Structured Asset Mortgage
Investments, Inc., 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
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") primarily consisting of seasoned adjustable rate and fixed rate
mortgage loans secured by first liens on one- to four- family residential
properties (collectively, the "Mortgage Loans") sold by Structured Asset
Mortgage Investments Inc. ("SAMI"). The




<PAGE>



Mortgage Loans were sold by EMC Mortgage Corporation ("EMC") to SAMI. Wells
Fargo Bank Minnesota, National Association will act as master servicer of the
Mortgage Loans (the "Master Servicer," which term includes any successors
thereto under the Agreement referred to below). The Trust Fund was created
pursuant to the Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement"), among SAMI, as depositor (the "Depositor"),
EMC Mortgage Corporation as seller and company, Wells Fargo Bank Minnesota,
National Association, as Master Servicer and securities administrator (the
"Securities Administrator") and Deutsche Bank National Trust Company as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms used
herein shall have the meaning ascribed to them 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 its acceptance hereof assents and by which such Holder is bound.

          The Trustee will distribute on the 25th day of each month, or, if such
25th day is not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last day (or if such last day is not a Business Day, the
Business Day immediately preceding such last day) of the calendar month
preceding the month of such Distribution Date, an amount equal to the product of
the Fractional Undivided Interest evidenced by this Certificate and the amount
of principal required to be distributed to the Holders of Certificates of the
same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month following the latest scheduled maturity date of
any Mortgage Loan and is not likely to be the date on which the Certificate
Principal Balance of this Class of Certificates will be reduced to zero.

                  Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register or, if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The initial Certificate Principal Balance of this Certificate is
set forth above. The Certificate Principal Balance hereof will be reduced to the
extent of distributions allocable to principal hereon and any Realized Losses
allocable hereto.

          This Certificate is one of a duly authorized issue of Certificates
designated as set forth on the face hereof (the "Certificates"), issued in
twenty-four classes. The Certificates, in the aggregate, evidence the entire
beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

          The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the Trust Fund for payment hereunder and that the
Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.



                                      A-4-3

<PAGE>



          This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for the interests, rights and limitations of
rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

          The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Seller, the Master Servicer and the Trustee and the rights of the
Certificateholders under the Agreement from time to time by the parties thereto
with the consent of the Holders of Certificates, evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust Fund (or in certain cases,
Holders of Certificates of affected Classes evidencing such percentage of the
Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such consent is made upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the Holders of any of the
Certificates.

          As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable with the
Trustee upon surrender of this Certificate for registration of transfer at the
offices or agencies maintained by the Trustee for such purposes, duly endorsed
by, or accompanied by a written instrument of transfer in form satisfactory to
the Trustee duly executed by the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates in authorized
denominations representing a like aggregate Percentage Interest will be issued
to the designated transferee.

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

          No service charge will be made to the Certificateholders for any such
registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.

          The obligations created by the Agreement and the Trust Fund created
thereby (other than the obligations to make payments to Certificateholders with
respect to the termination of the Agreement) shall terminate upon the earlier of
(i) the later of (A) the maturity or other liquidation (or Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund and disposition
of all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement, or
(ii) the optional repurchase by the party named in the Agreement of all the
Mortgage Loans and other assets of the Trust Fund in accordance with the terms
of the Agreement. Such optional repurchase may be made only on or after the
Distribution Date on which the aggregate Stated Principal Balance of the
Mortgage Loans is less


                                      A-4-4

<PAGE>



than the percentage of the aggregate Stated Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the expiration of 21
years after the death of certain persons identified in the Agreement.

          Unless this Certificate has been authenticated by an authorized
signatory of the Trustee by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement, or be valid for any purpose.



                                      A-4-5

<PAGE>



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

Dated: June __, 2003               DEUTSCHE BANK NATIONAL TRUST
                                   COMPANY
                                   Not in its individual capacity but solely as
                                   Trustee


                                   By:_________________________________________
                                            Authorized Signatory


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

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

                                 DEUTSCHE BANK NATIONAL TRUST COMPANY
                                 Authorized signatory of Deutsche Bank National
                                 Trust Company, not in its individual capacity
                                 but solely as Trustee

                                 By:___________________________________________
                                           Authorized Signatory





<PAGE>



                                   ASSIGNMENT
                                   ----------

          FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto __________________________________ (Please print or typewrite
name and address including postal zip code of assignee) a Fractional Undivided
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




                            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.







<PAGE>





                                                                       EXHIBIT B

                             MORTGAGE LOAN SCHEDULE

          The Preliminary and Final Mortgage Loan Schedules shall set forth the
following information with respect to each Mortgage Loan:

(a)  the loan number;

(b)  the Mortgagor's name;

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

(d)  the property type;

(e)  the Mortgage Rate;

(f)  the Servicing Rate;

(g)  the Net Rate;

(h)  the original term;

(i)  the maturity date;

(j)  the stated remaining term to maturity;

(k)  the original principal balance;

(1)  the first payment date;

(m)  the principal and interest payment in effect as of the Cut-off Date;

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

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

(p)  paid-through date;

(q)  the insurer of any Primary Mortgage Insurance Policy;

(r)  the Gross Margin, if applicable;

(s)  the Maximum Lifetime Mortgage Rate, if applicable;



                                       B-1

<PAGE>



(t)  the Minimum Lifetime Mortgage Rate, if applicable;

(u)  the Periodic Rate Cap, if applicable;

(v)  the number of days delinquent, if any;

(w)  which Mortgage Loans adjust after an initial fixed-rate period of five,
     seven or ten years;

(x)  The Loan Group; and

(y)  The Prepayment Charge Loans.

Such schedule also shall set forth for all of the Mortgage Loans, the total
number of Mortgage Loans, the total of each of the amounts described under (k)
and (n) above, the weighted average by principal balance as of the Cut-off Date
of each of the rates described under (e), (f) and (g) above, and the weighted
average remaining term to maturity by unpaid principal balance as of the Cut-off
Date.





                                       B-2

<PAGE>



                                                                       EXHIBIT C

                                   [RESERVED]



                                       C-1

<PAGE>



                                                                       EXHIBIT D

                        REQUEST FOR RELEASE OF DOCUMENTS

To:      Deutsche Bank National Trust Company
         1761 East St. Andrew Place
         Santa Ana, CA 92705

RE:      Pooling and Servicing Agreement dated as of
         June 1, 2003, among SAMI,
         Wells Fargo Bank Minnesota,
         National Association, as master servicer
          and securities administrator,
         EMC Mortgage Corporation and
         Deutsche Bank National Trust Company, as Trustee

         In connection with the administration of the Mortgage Loans held by you
pursuant to the above-captioned Pooling and Servicing Agreement, we request the
release, and hereby acknowledge receipt, of the Mortgage File for the Mortgage
Loan described below, for the reason indicated.

Mortgage Loan Number:
---------------------

Mortgagor Name, Address & Zip Code:
-----------------------------------

Reason for Requesting Documents (check one):
--------------------------------------------

_____ 1. Mortgage Paid in Full and proceeds have been deposited into the
     Custodial Account

_____ 2. Foreclosure

_____ 3. Substitution

_____ 4. Other Liquidation

_____ 5. Nonliquidation                             Reason:____________________

_____ 6. California Mortgage Loan paid in full


                                                 By:___________________________
                                                          (authorized signer)

                                                 Issuer:_______________________
                                                 Address:______________________
                                                 Date:_________________________


                                       D-1

<PAGE>



                                                                       EXHIBIT E

                                FORM OF AFFIDAVIT

                                            Affidavit pursuant to Section
                                            860E(e)(4) of the Internal Revenue
                                            Code of 1986, as amended, and for
                                            other purposes

STATE OF          )
                  ) ss:
COUNTY OF         )

     [NAME OF OFFICER], being first duly sworn, deposes and says:

     1. That he is [Title of Officer] of [Name of Investor] (the "Investor"), a
[savings institution] [corporation] duly organized and existing under the laws
of [the State of ] [the United States], on behalf of which he makes this
affidavit.

     2. That (i) the Investor is not a "disqualified organization" as defined in
Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended (the
"Code"), and will not be a disqualified organization as of [Closing Date] [date
of purchase]; (ii) it is not acquiring the Structured Asset Mortgage Investments
Inc., Structured Asset Mortgage Investments Trust, Mortgage Pass-Through
Certificates, Series 2003-CL1 Class R-I, Class R-II, Class R-III and Class R-IV
Certificates (the "Residual Certificates") for the account of a disqualified
organization; (iii) it consents to any amendment of the Pooling and Servicing
Agreement that shall be deemed necessary by Structured Asset Mortgage
Investments Inc. (upon advice of counsel) to constitute a reasonable arrangement
to ensure that the Residual Certificates will not be owned directly or
indirectly by a disqualified organization; and (iv) it will not transfer such
Residual Certificates unless (a) it has received from the transferee an
affidavit in substantially the same form as this affidavit containing these same
four representations and (b) as of the time of the transfer, it does not have
actual knowledge that such affidavit is false.

     3. That the Investor is one of the following: (i) a citizen or resident of
the United States, (ii) a corporation or partnership (including an entity
treated as a corporation or partnership for 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 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 United States Persons, (iii) an
estate whose income is subject to United States federal income tax regardless of
its source, or (iv) a trust other than a "foreign trust," as defined in Section
7701 (a)(31) of the Code.

     4. That the Investor's taxpayer identification number is
______________________.



                                       E-1

<PAGE>



     5. That no purpose of the acquisition of the Residual Certificates is to
avoid or impede the assessment or collection of tax.

     6. That the Investor understands that, as the holder of the Residual
Certificates, the Investor may incur tax liabilities in excess of any cash flows
generated by such Residual Certificates.

     7. That the Investor intends to pay taxes associated with holding the
Residual Certificates as they become due.

     IN WITNESS WHEREOF, the Investor has caused this instrument to be executed
on its behalf, pursuant to authority of its Board of Directors, by its [Title of
Officer] this ____ day of _________, 20__.


                                  [NAME OF INVESTOR]


                                  By:______________________________________
                                        [Name of Officer]
                                        [Title of Officer]
                                        [Address of Investor for receipt of
                                        distributions]

                                        Address of Investor
                                        for receipt of tax
                                        information:



                                       E-2

<PAGE>



         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 Investor, and acknowledged to me that he
executed the same as his free act and deed and the free act and deed of the
Investor.

         Subscribed and sworn before me this ___ day of _________, 20___.

NOTARY PUBLIC

COUNTY OF

STATE OF


My commission expires the ___ day of ___________________, 20___.




                                       E-3

<PAGE>



                                                                     EXHIBIT F-1

                            FORM OF INVESTMENT LETTER

                                                                          [Date]
[SELLER]

Deutsche Bank National Trust Company
1761 East St. Andrew Place
Santa Ana, CA 92705

Structured Asset Mortgage Investments Inc.
383 Madison Avenue
New York, New York 10179

     Re:  Structured Asset Mortgage Investments Inc., Structured Asset Mortgage
          Investments Trust, Series 2003-CL1 Mortgage Pass-Through Certificates
          (the "Certificates"), including the Class I-B4, Class I-B5, Class
          I-B6, Class II-B4, Class II-B5 and Class II-B6 Certificates (the
          "Privately Offered Certificates")
          ---------------------------------------------------------------------

Dear Ladies and Gentlemen:

         In connection with our purchase of Privately Offered Certificates, we
confirm that:

                  (i)      we understand that the Privately Offered Certificates
                           are not being registered under the Securities Act of
                           1933, as amended (the "Act") or any applicable state
                           securities or "Blue Sky" laws, and are being sold to
                           us in a transaction that is exempt from the
                           registration requirements of such laws;

                  (ii)     any information we desired concerning the
                           Certificates, including the Privately Offered
                           Certificates, the trust in which the Certificates
                           represent the entire beneficial ownership interest
                           (the "Trust") or any other matter we deemed relevant
                           to our decision to purchase Privately Offered
                           Certificates has been made available to us;

                  (iii)    we are able to bear the economic risk of investment
                           in Privately Offered Certificates; we are an
                           institutional "accredited investor" as defined in
                           Section 501(a) of Regulation D promulgated under the
                           Act and a sophisticated institutional investor;

                  (iv)     we are acquiring Privately Offered Certificates for
                           our own account, not as nominee for any other person,
                           and not with a present view to any distribution or
                           other disposition of the Privately Offered
                           Certificates;



                                      F-1-1

<PAGE>



                  (v)      we agree the Privately Offered Certificates must be
                           held indefinitely by us (and may not be sold,
                           pledged, hypothecated or in any way disposed of)
                           unless subsequently registered under the Act and any
                           applicable state securities or "Blue Sky" laws or an
                           exemption from the registration requirements of the
                           Act and any applicable state securities or "Blue Sky"
                           laws is available;

                  (vi)     we agree that in the event that at some future time
                           we wish to dispose of or exchange any of the
                           Privately Offered Certificates (such disposition or
                           exchange not being currently foreseen or
                           contemplated), we will not transfer or exchange any
                           of the Privately Offered Certificates unless:

                                    (A) (1) the sale is to an Eligible Purchaser
                           (as defined below), (2) if required by the Pooling
                           and Servicing Agreement (as defined below) a letter
                           to substantially the same effect as either this
                           letter or, if the Eligible Purchaser is a Qualified
                           Institutional Buyer as defined under Rule 144A of the
                           Act, the Rule 144A and Related Matters Certificate in
                           the form attached to the Pooling and Servicing
                           Agreement (as defined below) (or such other
                           documentation as may be acceptable to the Trustee) is
                           executed promptly by the purchaser and delivered to
                           the addressees hereof and (3) all offers or
                           solicitations in connection with the sale, whether
                           directly or through any agent acting on our behalf,
                           are limited only to Eligible Purchasers and are not
                           made by means of any form of general solicitation or
                           general advertising whatsoever; and

                                    (B) if the Privately Offered Certificate is
                           not registered under the Act (as to which we
                           acknowledge you have no obligation), the Privately
                           Offered Certificate is sold in a transaction that
                           does not require registration under the Act and any
                           applicable state securities or "blue sky" laws and,
                           if Deutsche Bank National Trust Company (the
                           "Trustee") so requests, a satisfactory Opinion of
                           Counsel is furnished to such effect, which Opinion of
                           Counsel shall be an expense of the transferor or the
                           transferee;

                  (vii)    we agree to be bound by all of the terms (including
                           those relating to restrictions on transfer) of the
                           Pooling and Servicing, pursuant to which the Trust
                           was formed; we have reviewed carefully and understand
                           the terms of the Pooling and Servicing Agreement;

                  (viii)   we either: (i) are not acquiring the Privately
                           Offered Certificate directly or indirectly by, or on
                           behalf of, an employee benefit plan or other
                           retirement arrangement which is subject to Title I of
                           the Employee Retirement Income Security Act of 1974,
                           as amended, or section 4975 of the Internal Revenue
                           Code of 1986, as amended, or (ii) (a) in the case of
                           the Class I-B4, Class I- B5, Class II-B4 and Class
                           II-B5 Certificates, are providing a representation
                           stating that one of the following statements is true
                           (1) we are not a Plan or investing with "Plan Assets"
                           or (2) (A) we are an Insurance Company, (B) the


                                      F-1-2

<PAGE>



                           source of funds used to acquire or hold the
                           Certificate or interest therein is an "Insurance
                           Company General Account," as such term is defined in
                           Prohibited Transaction Class Exemption ("PTCE")
                           95-60, and (C) the conditions in sections I and III
                           of PTCE 95-60 have been satisfied or (b) in the case
                           of the Class I-B6 Certificates and Class II-B6
                           Certificates, are providing a representation that the
                           transfer and holding of the Certificate and the
                           servicing, management and operation of the trust and
                           its assets: (1) will not result in any non-exempt
                           prohibited transaction and (2) will not give rise to
                           any additional obligations on the part of the Seller,
                           the Securities Administrator, the Master Servicer,
                           any Sub-Master Servicer, any Servicer or the Trustee
                           or (iii) unless the opinion specified in section 5.07
                           of the Agreement is provided.

                  (ix)     We understand that each of the Class I-B4, Class
                           I-B5, Class I-B6, Class II- B4, Class II-B5 and Class
                           II-B6 Certificates bears, and will continue to bear,
                           a legend to substantiate the following effect: "THIS
                           CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED
                           UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
                           "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES
                           LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
                           CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE
                           REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
                           ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
                           APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A
                           UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON
                           THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
                           INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
                           (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
                           PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
                           HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
                           PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
                           RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
                           REGISTRATION PROVIDED BY RULE 144 UNDER THE
                           SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED
                           FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN
                           THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or
                           (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN
                           WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH
                           PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN
                           VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE
                           RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN
                           THE FORM PROVIDED IN THE AGREEMENT AND (B) THE
                           RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
                           ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE,
                           PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
                           SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH
                           CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
                           LAWS OF THE UNITED STATES AND ANY OTHER


                                      F-1-3

<PAGE>



                           APPLICABLE JURISDICTION. THIS CERTIFICATE MAY NOT BE
                           ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF,
                           AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
                           ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE
                           EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
                           AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE
                           OF 1986, AS AMENDED UNLESS THE OPINION OF COUNSEL
                           REQUIRED BY SECTION 5.07 OF THE POOLING AND SERVICING
                           AGREEMENT IS PROVIDED OR [in the case of the Class
                           I-B6 Certificates and Class II-B6 Certificates]:,
                           UNLESS THE PROPOSED TRANSFER AND HOLDING OF A
                           CERTIFICATE AND THE SERVICING, MANAGEMENT AND
                           OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT
                           RESULT IN ANY NON-EXEMPT PROHIBITED TRANSACTION AND
                           (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY
                           DUTIES ON THE PART OF THE SELLER, THE SECURITIES
                           ADMINISTRATOR, THE MASTER SERVICER, ANY SUB-MASTER
                           SERVICER, ANY SERVICER OR THE TRUSTEE, WHICH WILL BE
                           DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY
                           CERTIFICATE OR A GLOBAL CERTIFICATE AND WILL BE
                           EVIDENCED BY A REPRESENTATION OR AN OPINION OF
                           COUNSEL TO SUCH EFFECT BY OR ON BEHALF OF AN
                           INSTITUTIONAL ACCREDITED INVESTOR [in the case of the
                           Class I- B1, Class I-B2, Class I-B3, Class I-B4,
                           Class I-B5, Class II-B1, Class II-B2, Class II-B3,
                           Class II-B4 and Class II-B5 Certificates] UNLESS
                           EITHER (I) IT IS NOT A PLAN OR INVESTING WITH "PLAN
                           ASSETS", (II) (1) IT IS AN INSURANCE COMPANY, (2)THE
                           SOURCE OF FUNDS USED TO ACQUIRE OR HOLD THE
                           CERTIFICATE OR INTEREST THEREIN IS AN "INSURANCE
                           COMPANY GENERAL ACCOUNT," AS SUCH TERM IS DEFINED IN
                           PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE")
                           95-60, AND (3) THE CONDITIONS IN SECTIONS I AND III
                           OF PTCE 95-60 HAVE BEEN SATISFIED."

         "Eligible Purchaser" means a corporation, partnership or other entity
which we have reasonable grounds to believe and do believe (i) can make
representations with respect to itself to substantially the same effect as the
representations set forth herein, and (ii) is either a Qualified Institutional
Buyer as defined under Rule 144A of the Act or an institutional "Accredited
Investor" as defined under Rule 501 of the Act.

         Terms not otherwise defined herein shall have the meanings assigned to
them in the Pooling and Servicing Agreement, dated as of June 1, 2003, among
Structured Asset Mortgage Investments Inc., Wells Fargo Bank Minnesota, National
Association as master servicer and securities administrator, EMC Mortgage
Corporation and Deutsche Bank National Trust Company, as Trustee (the "Pooling
and Servicing Agreement').



                                      F-1-4

<PAGE>



         If the Purchaser proposes that its Certificates be registered in the
name of a nominee on its behalf, the Purchaser has identified such nominee
below, and has caused such nominee to complete the Nominee Acknowledgment at the
end of this letter.


Name of Nominee (if any):_______________



                                      F-1-5

<PAGE>



          IN WITNESS WHEREOF, this document has been executed by the undersigned
who is duly authorized to do so on behalf of the undersigned Eligible Purchaser
on the ___ day of ________, 20___.

                                              Very truly yours,

                                              [PURCHASER]

                                              By:______________________________
                                                       (Authorized Officer)

                                              [By:_____________________________
                                                       Attorney-in-fact]



                                      F-1-6

<PAGE>



                             Nominee Acknowledgment

          The undersigned hereby acknowledges and agrees that as to the
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Purchaser identified above, for whom the undersigned is acting
as nominee.

                                               [NAME OF NOMINEE]

                                               By:_____________________________
                                                        (Authorized Officer)


                                               [By:____________________________
                                                        Attorney-in-fact]



                                      F-1-7

<PAGE>



                                                                     EXHIBIT F-2

                  FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE

[SELLER]                                                                  [Date]


Deutsche Bank National Trust Company
1761 East St. Andrew Place
Santa Ana, CA 92705

Structured Asset Mortgage Investments Inc.
383 Madison Avenue
New York, New York 10179

     Re:  Structured Asset Mortgage Investments Inc., Structured Asset Mortgage
          Investments Trust, Series 2003-CL1 Mortgage Pass-Through Certificates,
          Class I-B4, Class I-B5, Class I-B6, Class II-B4, Class II-B5 and Class
          II- B6 Certificates (the "Privately Offered Certificates")
          ----------------------------------------------------------------------

Dear Ladies and Gentlemen:

         In connection with our purchase of Privately Offered Certificates, the
undersigned certifies to each of the parties to whom this letter is addressed
that it is a qualified institutional buyer (as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Act")) as follows:

1.       It owned and/or invested on a discretionary basis eligible securities
         (excluding affiliate's securities, bank deposit notes and CD's, loan
         participations, repurchase agreements, securities owned but subject to
         a repurchase agreement and swaps), as described below:

         Date: ______________, 20__ (must be on or after the close of its most
         recent fiscal year)

         Amount: $ _____________________; and

2. The dollar amount set forth above is:

     a.   greater than $100 million and the undersigned is one of the following
          entities:

                  (x) |_| an insurance company as defined in Section 2(13) of
                          the Act1; or

--------
1    A purchase by an insurance company for one or more of its separate
     accounts, as defined by Section 2(a)(37) of the Investment Company Act of
     1940, which are neither registered nor required to be registered
     thereunder, shall be deemed to be a purchase for the account of such
     insurance company.



                                      F-2-1

<PAGE>



                  (y) |_| an investment company registered under the Investment
                          Company Act or any business development company as
                          defined in Section 2(a)(48) of the Investment Company
                          Act of 1940; or

                  (z) |_| 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; or

                  (aa)|_| a plan (i) established and maintained by a state, its
                          political subdivisions, or any agency or
                          instrumentality of a state or its political
                          subdivisions, the laws of which permit the purchase of
                          securities of this type, for the benefit of its
                          employees and (ii) the governing investment guidelines
                          of which permit the purchase of securities of this
                          type; or

                  (bb)|_| a business development company as defined in Section
                          202(a)(22) of the Investment Advisers Act of 1940; or

                  (cc)|_| a corporation (other than a U.S. bank, savings and
                          loan association or equivalent foreign institution),
                          partnership, Massachusetts or similar business trust,
                          or an organization described in Section 501(c)(3) of
                          the Internal Revenue Code; or

                  (dd)|_| a U.S. bank, savings and loan association or
                          equivalent foreign institution, which has an audited
                          net worth of at least $25 million as demonstrated in
                          its latest annual financial statements; or

                  (ee)|_| an investment adviser registered under the Investment
                          Advisers Act; or

         b.  |_|    greater than $10 million, and the undersigned is a
                    broker-dealer registered with the SEC; or

         c.  |_|    less than $ 10 million, and the undersigned is a
                    broker-dealer registered with the SEC and will only purchase
                    Rule 144A securities in transactions in which it acts as a
                    riskless principal (as defined in Rule 144A); or

         d.  |_|    less than $100 million, and the undersigned is an investment
                    company registered under the Investment Company Act of 1940,
                    which, together with one or more registered investment
                    companies having the same or an affiliated investment
                    adviser, owns at least $100 million of eligible securities;
                    or

         e.  |_|    less than $100 million, and the undersigned is an entity,
                    all the equity owners of which are qualified institutional
                    buyers.



                                      F-2-2

<PAGE>



         The undersigned further certifies that it is purchasing a Privately
Offered Certificate for its own account or for the account of others that
independently qualify as "Qualified Institutional Buyers" as defined in Rule
144A. It is aware that the sale of the Privately Offered Certificates is being
made in reliance on its continued compliance with Rule 144A. It is aware that
the transferor may rely on the exemption from the provisions of Section 5 of the
Act provided by Rule 144A. The undersigned understands that the Privately
Offered Certificates may be resold, pledged or transferred only to (i) 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 in Rule
144A, or (ii) an institutional "accredited investor," as such term is defined
under Rule 501 of the Act in a transaction that otherwise does not constitute a
public offering.

         The undersigned agrees that if at some future time it wishes to dispose
of or exchange any of the Privately Offered Certificates, it will not transfer
or exchange any of the Privately Offered Certificates to a Qualified
Institutional Buyer without first obtaining a Rule 144A and Related Matters
Certificate in the form hereof from the transferee and delivering such
certificate to the addressees hereof. Prior to making any transfer of Privately
Offered Certificates, if the proposed Transferee is an institutional "accredited
investor," the transferor shall obtain from the transferee and deliver to the
addressees hereof an Investment Letter in the form attached to the Pooling and
Servicing Agreement, dated as of June 1, 2003, among Structured Asset Mortgage
Investments Inc., Wells Fargo Bank Minnesota, National Association, EMC Mortgage
Corporation and Deutsche Bank National Trust Company, as Trustee, pursuant to
Certificates were issued.

         The undersigned certifies that either: (i) it is not acquiring the
Privately Offered Certificate directly or indirectly by, or on behalf of, an
employee benefit plan or other retirement arrangement which is subject to Title
I of the Employee Retirement Income Security Act of 1974, as amended, or section
4975 of the Internal Revenue Code of 1986, as amended, or (ii) (a) in the case
of the Class I-B4, Class I-B5, Class II-B4 and Class II-B5 Certificates, is
providing a representation stating that one of the following statements is true
(1) it are not a Plan or investing with "Plan Assets" or (2) (A) it is an
Insurance Company, (B) the source of funds used to acquire or hold the
Certificate or interest therein is an "Insurance Company General Account," as
such term is defined in Prohibited Transaction Class Exemption ("PTCE") 95-60,
and (C) the conditions in sections I and III of PTCE 95-60 have been satisfied
or (b) in the case of the Class I-B6 Certificates and Class II-B6 Certificates,
is providing a representation that the transfer and holding of the Certificate
and the servicing, management and operation of the trust and its assets: (1)
will not result in any non-exempt prohibited transaction and (2) will not give
rise to any additional obligations on the part of the Seller, the Securities
Administrator, the Master Servicer, any Sub-Master Servicer, any Servicer or the
Trustee or (iii) unless the opinion specified in section 5.07 of the Agreement
is provided.

         If the Purchaser proposes that its Certificates be registered in the
name of a nominee on its behalf, the Purchaser has identified such nominee
below, and has caused such nominee to complete the Nominee Acknowledgment at the
end of this letter.




                                      F-2-3

<PAGE>



Name of Nominee (if any):

IN WITNESS WHEREOF, this document has been executed by the undersigned who is
duly authorized to do so on behalf of the undersigned Eligible Purchaser on the
____ day of ___________, 20___.

                                                 Very truly yours,

                                                 [PURCHASER]


                                                 By:___________________________
                                                       (Authorized Officer)

                                                 [By:__________________________
                                                          Attorney-in-fact]




                                      F-2-4

<PAGE>



                                              Nominee Acknowledgment

         The undersigned hereby acknowledges and agrees that as to the
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Purchaser identified above, for whom the undersigned is acting
as nominee.

                                                 [NAME OF NOMINEE]

                                                 By:___________________________
                                                        (Authorized Officer)

                                                 [By:__________________________
                                                          Attorney-in-fact]



                                      F-2-5

<PAGE>



                                                                       EXHIBIT G

                           FORM OF CUSTODIAL AGREEMENT
                           ---------------------------


                  THIS CUSTODIAL AGREEMENT (as amended and supplemented from
time to time, the "Agreement'), dated as of June 30, 2003, by and among DEUTSCHE
BANK NATIONAL TRUST COMPANY, as trustee (including its successors under the
Pooling and Servicing Agreement defined below, the "Trustee"), STRUCTURED ASSET
MORTGAGE INVESTMENTS INC., as company (together with any successor in interest,
the "Company"), WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as master
servicer and securities administrator (together with any successor in interest
or successor under the Pooling and Servicing Agreement referred to below, the
"Master Servicer") and WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as
custodian (together with any successor in interest or any successor appointed
hereunder, the "Custodian").


                                WITNESSETH THAT:
                                ----------------

                  WHEREAS, the Company, the Master Servicer and the Trustee have
entered into a Pooling and Servicing Agreement, dated as of June 1, 2003,
relating to the issuance of Structured Asset Mortgage Investments Trust
2003-CL1, Mortgage Pass-Through Certificates, Series 2003-CL1 (as in effect on
the date of this agreement, the "Original Pooling and Servicing Agreement," and
as amended and supplemented from time to time, the "Pooling and Servicing
Agreement'); and

                  WHEREAS, the Custodian has agreed to act as agent for the
Trustee for the purposes of receiving and holding certain documents and other
instruments delivered by the Company or the Master Servicer under the Pooling
and Servicing Agreement and the Servicers under their respective Servicing
Agreements, all upon the terms and conditions and subject to the limitations
hereinafter set forth;

                  NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements hereinafter set forth, the Trustee, the Company,
the Master Servicer and the Custodian hereby agree as follows:

                                   ARTICLE I.
                                   DEFINITIONS

                  Capitalized terms used in this Agreement and not defined
herein shall have the meanings assigned in the Original Pooling and Servicing
Agreement, unless otherwise required by the context herein.

                                   ARTICLE II.
                          CUSTODY OF MORTGAGE DOCUMENTS





<PAGE>



                  Section 2.1. Custodian to Act as Agent: Acceptance of Mortgage
Files. The Custodian, as the duly appointed agent of the Trustee for these
purposes, acknowledges (subject to any exceptions noted in the Initial
Certification referred to in Section 2.3(a) receipt of the Mortgage Files
relating to the Mortgage Loans identified on the schedule attached hereto (the
"Mortgage Files") and declares that it holds and will hold such Mortgage Files
as agent for the Trustee, in trust, for the use and benefit of all present and
future Certificateholders.

                  Section 2.2. Recordation of Assignments. If any Mortgage File
includes one or more assignments of Mortgage to the Trustee in a state which is
specifically excluded from the Opinion of Counsel delivered by the Seller to the
Trustee (with a copy to the Custodian) pursuant to the provisions of Section
2.01 of the Pooling and Servicing Agreement, each such assignment shall be
delivered by the Custodian to the Company for the purpose of recording it in the
appropriate public office for real property records, and the Company, at no
expense to the Custodian, shall promptly cause to be recorded in the appropriate
public office for real property records each such assignment of Mortgage and,
upon receipt thereof from such public office, shall return each such assignment
of Mortgage to the Custodian.

                  Section 2.3.   Review of Mortgage Files.

                  (a) On or prior to the Closing Date, in accordance with
Section 2.02 of the Pooling and Servicing Agreement, the Custodian shall deliver
to the Trustee an Initial Certification in the form annexed hereto as Exhibit
One evidencing receipt (subject to any exceptions noted therein) of a Mortgage
File for each of the Mortgage Loans listed on the Schedule attached hereto (the
"Mortgage Loan Schedule").

                  (b) Within 180 days of the Closing Date, the Custodian agrees,
for the benefit of Certificateholders, to review, in accordance with the
provisions of Section 2.02 of the Pooling and Servicing Agreement, each such
document, and shall deliver to the Seller and the Trustee an Interim
Certification in the form annexed hereto as Exhibit Two to the effect that all
such documents have been executed and received and that such documents relate to
the Mortgage Loans identified on the Mortgage Loan Schedule, except for any
exceptions listed on Schedule A attached to such Interim Certification. The
Custodian shall be under no 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 that they are other than what they
purport to be on their face.

                  (c) Not later than 270 days after the Closing Date, the
Custodian shall review the Mortgage Files as provided in Section 2.02 of the
Pooling and Servicing Agreement and deliver to the Seller and the Trustee a
Final Certification in the form annexed hereto as Exhibit Three evidencing the
completeness of the Mortgage Files.

                  (d) In reviewing the Mortgage Files as provided herein and in
the Pooling and Servicing Agreement, the Custodian shall make no representation
as to and shall not be responsible to verify (i) the validity, legality,
enforceability, due authorization, recordability, sufficiency or genuineness of
any of the documents included in any Mortgage File or (ii) the


                                       G-2

<PAGE>



collectibility, insurability, effectiveness or suitability of any of the
documents in any Mortgage File.

         Upon receipt of written request from the Trustee, the Custodian shall
as soon as practicable supply the Trustee with a list of all of the documents
relating to the Mortgage Loans missing from the Mortgage Files.

                  Section 2.4. Notification of Breaches of Representations and
Warranties. Upon discovery by the Custodian of a breach of any representation or
warranty made by the Company as set forth in the Pooling and Servicing Agreement
with respect to a Mortgage Loan relating to a Mortgage File, the Custodian shall
give prompt written notice to the Company, the related Servicer and the Trustee.

                  Section 2.5. Custodian to Cooperate: Release of Mortgage
Files. Upon the repurchase of a Mortgage Loan by the Mortgage Loan Seller
pursuant to Article II of the Pooling and Servicing Agreement, and notice from
the Master Servicer or Securities Administrator that the purchase price
therefore has been deposited in the Master Servicer Collection Account or the
Distribution Account, then the Custodian agrees to promptly release to the
Mortgage Loan Seller the related Mortgage File.

                  Upon the Custodian's receipt of a request for release (a
"Request for Release") substantially in the form of Exhibit D to the Pooling and
Servicing Agreement signed by a Servicing Officer of the related Servicer
stating that it has received payment in full of a Mortgage Loan or that payment
in full will be escrowed in a manner customary for such purposes (or, if the
Servicer does not make such request, upon receipt of a Request for Release
signed on behalf of the Master Servicer), the Custodian agrees promptly to
release to the related Servicer the related Mortgage File. The Company shall
deliver to the Custodian and the Custodian agrees to accept the Mortgage Note
and other documents constituting the Mortgage File with respect to any
Substitute Mortgage Loan.

                  From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any Primary Insurance Policy, the related Servicer shall deliver to the
Custodian a Request for Release signed by a Servicing Officer requesting that
possession of all of the Mortgage File be released to the related Servicer and
certifying as to the reason for such release and that such release will not
invalidate any insurance coverage provided in respect of the Mortgage Loan under
any of the Insurance Policies. Upon receipt of the foregoing, the Custodian
shall deliver the Mortgage File to the related Servicer. The related Servicer
shall cause each Mortgage File or any document therein so released to be
returned to the Custodian when the need therefore by the related Servicer no
longer exists, unless (i) the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Master Servicer Collection Account or the Distribution Account or (ii) the
Mortgage File or such document has been delivered to an attorney, or to a public
trustee or other public official as required by law, for purposes of initiating
or pursuing legal action or other proceedings for the foreclosure of the
Mortgaged Property either judicially or non-judicially, and the related Servicer
has delivered to the Custodian a certificate of a Servicing Officer certifying
as to the name and address of the Person


                                       G-3

<PAGE>



to which such Mortgage File or such document was delivered and the purpose or
purposes of such delivery.

                  At any time that a Servicer is required to deliver to the
Custodian a Request for Release, the Servicer shall deliver two copies of the
Request for Release if delivered in hard copy or the Servicer may furnish such
Request for Release electronically to the Custodian, in which event the
Servicing Officer transmitting the same shall be deemed to have signed the
Request for Release. In connection with any Request for Release of a Mortgage
File because of a repurchase of a Mortgage Loan, such Request for Release shall
be followed by an assignment of mortgage (provided to the Trustee or the
Custodian, as its agent, for execution), without recourse, representation or
warranty from the Trustee to the Mortgage Loan Seller and the related Mortgage
Note shall be endorsed without recourse by the Trustee and be returned to the
Mortgage Loan Seller. In connection with any Request for Release of a Mortgage
File because of the payment in full of a Mortgage Loan, such Request for Release
shall be accompanied by a certificate of satisfaction or other similar
instrument to be executed by or on behalf of the Trustee and returned to the
related Servicer.

                  Section 2.6. Assumption Agreements. In the event that any
assumption agreement, substitution of liability agreement or sale of servicing
agreement is entered into with respect to any Mortgage Loan subject to this
Agreement in accordance with the terms and provisions of the Pooling and
Servicing Agreement, the Master Servicer, to the extent provided in the related
Servicing Agreement, shall cause the related Servicer to notify the Custodian
that such assumption or substitution agreement has been completed by forwarding
to the Custodian the original of such assumption or substitution agreement,
which shall be added to the related Mortgage File and, for all purposes, shall
be considered a part of such Mortgage File to the same extent as all other
documents and instruments constituting parts thereof.

                                  ARTICLE III.
                            CONCERNING THE CUSTODIAN

                  Section 3.1. Custodian as Bailee and Agent of the Trustee.
With respect to each Mortgage Note, Mortgage and other documents constituting
each Mortgage File which are delivered to the Custodian, the Custodian is
exclusively the bailee and agent of the Trustee and has no instructions to hold
any Mortgage Note or Mortgage for the benefit of any person other than the
Trustee and the Certificateholders and undertakes to perform such duties and
only such duties as are specifically set forth in this Agreement. Except upon
compliance with the provisions of Section 2.5 of this Agreement, no Mortgage
Note, Mortgage or Mortgage File shall be delivered by the Custodian to the
Company, the Servicers or the Master Servicer or otherwise released from the
possession of the Custodian.

                  Section 3.2.   Reserved.

                  Section 3.3. Custodian May Own Certificates. The Custodian in
its individual or any other capacity may become the owner or pledgee of
Certificates with the same rights it would have if it were not Custodian.



                                       G-4

<PAGE>



                  Section 3.4. Master Servicer to Pay Custodian's Fees and
Expenses. The Master Servicer covenants and agrees to pay to the Custodian from
time to time, and the Custodian shall be entitled to, reasonable compensation
for all services rendered by it in the exercise and performance of any of the
powers and duties hereunder of the Custodian, and the Master Servicer will pay
or reimburse the Custodian upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Custodian in accordance with
any of the provisions of this Agreement (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ), except any such expense, disbursement or advance as
may arise from its negligence or bad faith or to the extent that such cost or
expense is indemnified by the Company pursuant to the Pooling and Servicing
Agreement.

                  Section 3.5. Custodian May Resign Trustee May Remove
Custodian. The Custodian may resign from the obligations and duties hereby
imposed upon it as such obligations and duties relate to its acting as Custodian
of the Mortgage Loans. Upon receiving such notice of resignation, the Trustee
shall either take custody of the Mortgage Files itself and give prompt notice
thereof to the Company, the Master Servicer and the Custodian, or promptly
appoint a successor Custodian by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Custodian and one copy to
the successor Custodian. If the Trustee shall not have taken custody of the
Mortgage Files and no successor Custodian shall have been so appointed and have
accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Custodian may petition any court of competent
jurisdiction for the appointment of a successor Custodian.

                  The Trustee may remove the Custodian at any time with the
consent of the Master Servicer. In such event, the Trustee shall appoint, or
petition a court of competent jurisdiction to appoint, a successor Custodian
hereunder. Any successor Custodian shall be a depository institution subject to
supervision or examination by federal or state authority, shall be able to
satisfy the other requirements contained in Section 3.7 and shall be
unaffiliated with the Servicer or the Company.

                  Any resignation or removal of the Custodian and appointment of
a successor Custodian pursuant to any of the provisions of this Section 3.5
shall become effective upon acceptance of appointment by the successor
Custodian. The Trustee shall give prompt notice to the Company and the Master
Servicer of the appointment of any successor Custodian. No successor Custodian
shall be appointed by the Trustee without the prior approval of the Company and
the Master Servicer.

                  Section 3.6. Merger or Consolidation of Custodian. Any Person
into which the Custodian may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Custodian shall be a party, or any Person succeeding
to the business of the Custodian, shall be the successor of the Custodian
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding.

                  Section 3.7. Representations of the Custodian. The Custodian
hereby represents that it is a depository institution subject to supervision or
examination by a federal or state


                                       G-5

<PAGE>



authority, has a combined capital and surplus of at least $15,000,000 and is
qualified to do business in the jurisdictions in which it will hold any Mortgage
File.

                                   ARTICLE IV.
                            MISCELLANEOUS PROVISIONS

                  Section 4.1. Notices. All notices, requests, consents and
demands and other communications required under this Agreement or pursuant to
any other instrument or document delivered hereunder shall be in writing and,
unless otherwise specifically provided, may be delivered personally, by telegram
or telex, or by registered or certified mail, postage prepaid, return receipt
requested, at the addresses specified on the signature page hereof (unless
changed by the particular party whose address is stated herein by similar notice
in writing), in which case the notice will be deemed delivered when received.

                  Section 4.2. Amendments. No modification or amendment of or
supplement to this Agreement shall be valid or effective unless the same is in
writing and signed by all parties hereto, and neither the Company, the Master
Servicer nor the Trustee shall enter into any amendment hereof except as
permitted by the Pooling and Servicing Agreement. The Trustee shall give prompt
notice to the Custodian of any amendment or supplement to the Pooling and
Servicing Agreement and furnish the Custodian with written copies thereof.

                  Section 4.3. GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED A
CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

                  Section 4.4. Recordation of Agreement. 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 Company and at the Trust's expense, but
only upon direction accompanied by an Opinion of Counsel reasonably satisfactory
to the Company to the effect that the failure to effect such recordation is
likely to materially and adversely affect 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 4.5. 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.


                                       G-6

<PAGE>




          IN WITNESS WHEREOF, this Agreement is executed as of the date first
above written.



Address:                                     DEUTSCHE BANK NATIONAL TRUST
                                             COMPANY, as Trustee
1761 East St. Andrew Place
Santa Ana, California  92705
                                             By:_______________________________
Attention:                                   Name:
Telecopy:                                    Title:
Confirmation:
Address:                                     STRUCTURED ASSET MORTGAGE
                                             INVESTMENTS INC.
383 Madison Avenue
New York, New York 10179
                                             By:_______________________________
                                             Name:    Baron Silverstein
                                             Title:   Vice President

Address:                                     WELLS FARGO BANK MINNESOTA,
                                             NATIONAL ASSOCIATION, as Master
9062 Old Annapolis Road                      Servicer
Columbia, Maryland 21045

                                             By:_______________________________
                                             Name: Stacey Taylor
                                             Title:   Assistant Vice President

Address:                                     WELLS FARGO BANK MINNESOTA,
                                             NATIONAL ASSOCIATION, as Custodian
9062 Old Annapolis Road
Columbia, Maryland 21045                     By:_______________________________
                                             Name:    Stacey Taylor
                                             Title:   Assistant Vice President





<PAGE>



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

          On the 30th day of June 2003 before me, a notary public in and for
said State, personally appeared _______________, known to me to be a
_________________of Deutsche Bank National Trust Company, a national banking
association 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


[SEAL]






<PAGE>



STATE OF MARYLAND         )
                          ) ss.:
COUNTY OF HOWARD          )

                  On the 30th day of June 2003 before me, a notary public in and
for said State, personally appeared Stacey Taylor, known to me to be an
Assistant Vice President of Wells Fargo Bank Minnesota, National Association, a
national banking association that executed the within instrument, and also known
to me to be the person who executed it on behalf of said national banking
association, and acknowledged to me that such national banking association
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

[SEAL]





<PAGE>



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

                  On the 30th day of June 2003 before me, a notary public in and
for said State, personally appeared Baron Silverstein, known to me to be a Vice
President of Structured Asset Mortgage Investments Inc., one of the corporations
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

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



                                                   ____________________________
                                                           Notary Public

[Notarial Seal]







<PAGE>



STATE OF MARYLAND           )
                            )ss.:
 COUNTY OF HOWARD           )


                  On the 30th day of June 2003 before me, a notary public in and
for said State, personally appeared Stacey Taylor, known to me to be an
Assistant Vice President of Wells Fargo Bank Minnesota, National Association,
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>



                                   EXHIBIT ONE

                     FORM OF CUSTODIAN INITIAL CERTIFICATION


                                                        June __, 20__



Deutsche Bank National Trust Company  Structured Asset Mortgage Investments Inc.
1761 East St. Andrew Place            383 Madison Avenue
Santa Ana, California 92705           New York, New York 10179



Attention: Structured Asset Mortgage Investments Inc. Structured Asset Mortgage
Investments Trust 2003-CL1, Mortgage Pass-Through Certificates, Series 2003-CL1

          Re:  Custodial Agreement, dated as of June 30, 2003, by and among
               Deutsche Bank National Trust Company, Structured Asset Mortgage
               Investments Inc. and Wells Fargo Bank Minnesota, National
               Association relating to Structured Asset Mortgage Investments
               Trust 2003-CL1, Mortgage Pass-Through Certificates, Series
               2003-CL1
               ----------------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.3 of the above-captioned
Custodial Agreement, and subject to Section 2.02 of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File (which contains an original Mortgage Note or lost note
affidavit) to the extent required in Section 2.01 of the Pooling and Servicing
Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, with any exceptions listed on Schedule A attached hereto.

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Custodial Agreement.

                                                    WELLS FARGO BANK MINNESOTA,
                                                    NATIONAL ASSOCIATION


                                                    By:________________________
                                                    Name:
                                                    Title:



                                                        G-6

<PAGE>



                                   EXHIBIT TWO

                     FORM OF CUSTODIAN INTERIM CERTIFICATION

                                                             __, 20__


Deutsche Bank National Trust Company               Structured Asset Mortgage
1761 East St. Andrew Place                         Investments Inc.
Santa Ana, California 92705                        383 Madison Avenue
                                                   New York, New York 10179



Attention: Structured Asset Mortgage Investments Inc. Structured Asset Mortgage
Investments Trust 2003-CL1, Mortgage Pass-Through Certificates, Series 2003-CL1

          Re:  Custodial Agreement, dated as of June 30, 2003, by and among
               Deutsche Bank National Trust Company, Structured Asset Mortgage
               Investments Inc. and Wells Fargo Bank Minnesota, National
               Association relating to Structured Asset Mortgage Investments
               Trust 2003-CL1, Mortgage Pass-Through Certificates, Series
               2003-CL1
               ----------------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.3 of the above-captioned
Custodial Agreement, the undersigned, as Custodian, hereby certifies that it has
received a Mortgage File to the extent required pursuant to Section 2.01 of the
Pooling and Servicing Agreement with respect to each Mortgage Loan listed in the
Mortgage Loan Schedule, and it has reviewed the Mortgage File and the Mortgage
Loan Schedule and has determined that: all required documents have been executed
and received and that such documents related to the Mortgage Loans identified on
the Mortgage Loan Schedule, with any exceptions listed on Schedule A attached
hereto.

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Custodial Agreement.

                                                     WELLS FARGO BANK MINNESOTA,
                                                     NATIONAL ASSOCIATION


                                                     By:_______________________
                                                     Name:_____________________
                                                     Title:____________________






<PAGE>



                                  EXHIBIT THREE

                      FORM OF CUSTODIAN FINAL CERTIFICATION



                                                            _______, 20__



Deutsche Bank National Trust Company                  Structured Asset Mortgage
1761 East St. Andrew Place                            Investments Inc.
Santa Ana, California 92705                           383 Madison Avenue
                                                      New York, New York 10179


Attention: Structured Asset Mortgage Investments Inc. Structured Asset Mortgage
Investments Trust 2003-CL1, Mortgage Pass-Through Certificates, Series 2003-CL1

          Re:  Custodial Agreement, dated as of June 30, 2003, by and among
               Deutsche Bank National Trust Company, Structured Asset Mortgage
               Investments Inc. and Wells Fargo Bank Minnesota, National
               Association relating to Structured Asset Mortgage Investments
               Trust 2003-CL1, Mortgage Pass-Through Certificates, Series
               2003-CL1
               ----------------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.3 of the above-captioned
Custodial Agreement and subject to Section 2.02(b) of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule containing with respect to (I) each Mortgage Loan (other than a
Cooperative Loan):

                  (i) The original Mortgage Note, endorsed without recourse to
         the order of the Trustee and showing an unbroken chain of endorsements
         from the originator thereof to the Person endorsing it to the Trustee,
         or a lost note affidavit together with a copy of the related Mortgage
         Note;

                  (ii) The original Mortgage and, if the related Mortgage Loan
         is a MOM Loan, noting the presence of the MIN and language indicating
         that such Mortgage Loan is a MOM Loan, which shall have been recorded
         (or if the original is not available, a copy), with evidence of such
         recording indicated thereon (or if the original is not available, a
         copy), with evidence of such recording indicated thereon (or if the
         original Security Instrument, assignments to the Trustee or intervening
         assignments thereof which have been delivered, are being delivered or
         will, upon receipt of recording information relating to the Security
         Instrument required to be included thereon, be delivered to recording
         offices for recording and have not been




<PAGE>



         returned to the Seller in time to permit their recording as specified
         in Section 2.01(b) of the Pooling and Servicing Agreement, shall be in
         recordable form);

                  (iii) unless the Mortgage Loan is a MOM Loan, a certified copy
         of the assignment (which may be in the form of a blanket assignment if
         permitted in the jurisdiction in which the Mortgaged Property is
         located) to "Deutsche Bank National Trust Company, as Trustee", with
         evidence of recording with respect to each Mortgage Loan in the name of
         the Trustee thereon (or if (A) the original Security Instrument,
         assignments to the Trustee or intervening assignments thereof which
         have been delivered, are being delivered or will, upon receipt of
         recording information relating to the Security Instrument required to
         be included thereon, be delivered to recording offices for recording
         and have not been returned to the Seller in time to permit their
         delivery as specified in Section 2.01(b) of the Pooling and Servicing
         Agreement, a true copy thereof with a certification by the Seller, on
         the face of such copy, substantially as follows: "Certified to be a
         true and correct copy of the original, which has been transmitted for
         recording" or (B) the related Mortgaged Property is located in a state
         other than Maryland and an Opinion of Counsel has been provided as set
         forth in Section 2.01(b), shall be in recordable form);

                  (iv) all intervening assignments of the Security Instrument,
         if applicable and only to the extent available to the Seller with
         evidence of recording thereon;

                  (v) the original or a copy of the policy or certificate of
         primary mortgage guaranty insurance, to the extent available, if any;

                  (vi) the original policy of title insurance or mortgagee's
         certificate of title insurance or commitment or binder for title
         insurance; and

                  (vii) originals of all modification agreements, if applicable
         and available.

         and (II) with respect to each Cooperative Loan so assigned:

                  (i) The original Mortgage Note, endorsed without recourse to
         the order of the Trustee and showing an unbroken chain of endorsements
         from the originator thereof to the Person endorsing it to the Trustee,
         or lost note affidavit, together with a copy of the related Mortgage
         Note;

                  (ii) A counterpart of the Cooperative Lease and the Assignment
         of Proprietary Lease to the originator of the Cooperative Loan with
         intervening assignments showing an unbroken chain of title from such
         originator to the Trustee;

                  (iii) The related Cooperative Stock Certificate, representing
         the related Cooperative Stock pledged with respect to such Cooperative
         Loan, together with an undated stock power (or other similar
         instrument) executed in blank;

                  (iv) The original recognition agreement by the Cooperative of
         the interests of the mortgagee with respect to the related Cooperative
         Loan;


                                       G-6

<PAGE>



                  (v) The Security Agreement;

                  (vi) Copies of the original UCC-1 financing statement, and any
         continuation statements, filed by the originator of such Cooperative
         Loan as secured party, each with evidence of recording thereof,
         evidencing the interest of the originator under the Security Agreement
         and the Assignment of Proprietary Lease;

                  (vii) Copies of the filed UCC-3 assignments of the security
         interest referenced in clause (vi) above showing an unbroken chain of
         title from the originator to the Trustee, each with evidence of
         recording thereof, evidencing the interest of the originator under the
         Security Agreement and the Assignment of Proprietary Lease;

                  (viii) An executed assignment of the interest of the
         originator in the Security Agreement and Assignment of Proprietary
         Lease referenced in clause (iv) above, showing an unbroken chain of
         title from the originator to the Trustee; and

                  (ix) The original of each modification, assumption agreement
         or preferred loan agreement, if any, relating to such Cooperative Loan.

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Custodial Agreement
or in the Pooling and Servicing Agreement, as applicable.

                                                    WELLS FARGO BANK
                                                    MINNESOTA, NATIONAL
                                                    ASSOCIATION



                                                    By:________________________
                                                    Name:______________________
                                                    Title:_____________________



                                       G-6

<PAGE>




                                                                     EXHIBIT H-1

                               SERVICING AGREEMENT

                                    ABN AMRO

                             [provided upon request]






                                       H-1

<PAGE>



                                                                     EXHIBIT H-2

                               SERVICING AGREEMENT

                                    Alliance

                             [provided upon request]




                                       H-2

<PAGE>



                                                                     EXHIBIT H-3

                              SERVICING AGREEMENTS

                                      BofA

                             [provided upon request]



                                       H-3

<PAGE>



                                                                     EXHIBIT H-4


                               SERVICING AGREEMENT

                                       EMC

                             [provided upon request]






















                                       H-4

<PAGE>



                                                                     EXHIBIT H-5


                               SERVICING AGREEMENT

                                   GE Capital

                             [provided upon request]




























                                       H-5

<PAGE>



                                                                     EXHIBIT H-6


                               SERVICING AGREEMENT

                                   GreenPoint

                             [provided upon request]




                                       H-6

<PAGE>



                                                                     EXHIBIT H-7


                               SERVICING AGREEMENT

                                      Impac

                             [provided upon request]




                                       H-7

<PAGE>



                                                                     EXHIBIT H-8


                               SERVICING AGREEMENT

                                     Liberty

                             [provided upon request]






                                      H-8

<PAGE>



                                                                     EXHIBIT H-9


                               SERVICING AGREEMENT

                                       MFB

                             [provided upon request]








                                       H-9

<PAGE>



                                                                    EXHIBIT H-10


                               SERVICING AGREEMENT

                                    Sky Bank

                             [provided upon request]








                                      H-10

<PAGE>



                                                                    EXHIBIT H-11


                               SERVICING AGREEMENT

                                 Union Planters

                             [provided upon request]









                                      H-11

<PAGE>



                                                                    EXHIBIT H-12


                               SERVICING AGREEMENT

                                    Universal

                             [provided upon request]










                                      H-12

<PAGE>



                                                                    EXHIBIT H-13


                               SERVICING AGREEMENT

                                      WMBFA

                             [provided upon request]










                                      H-13

<PAGE>



                                                                    EXHIBIT H-14


                               SERVICING AGREEMENT

                                      WFHM

                             [provided upon request]




                                      H-14

<PAGE>



                                                                       EXHIBIT J

                    FORM OF MORTGAGE LOAN PURCHASE AGREEMENT

                             [provided upon request]




                                       J-1

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                          EXHIBIT K

                                                    Foreclosure Restricted Loans

                                                                               Stated                                    Current
                                        AM               First Pay   Stated   Original             Original     Current   Gross
Loan ID        Pool 1      Servicer    Type   Note Date    Date        MAT      Term     Payment    Balance     Balance   Coupon
-------        ------      --------    ----   ---------    ----        ---      ----     -------    -------     -------   ------
<S>            <C>         <C>         <C>     <C>        <C>        <C>         <C>      <C>       <C>         <C>        <C>
438046         B.92-18     Alliance    Fixed   19760524   19760601   20060501    360      335.65    43650.00    11110.46   8.500
433655         B.92-18     Alliance    Fixed   19741001   19750101   20041201    360      117.04    13900.00     1704.94   9.500
434140         B.92-18     Alliance    Fixed   19751230   19760201   20060101    360      314.80    38250.00     8951.77   9.250
435372         D.93-2P     Alliance    Fixed   19780217   19780401   20080301    360      353.71    46000.00    16764.98   8.500
435634         D.93-2P     Alliance    Fixed   19780511   19780601   20080501    360      238.58    29000.00    10583.32   9.250
433931         D.93-2P     Alliance    Fixed   19841031   19841201   20141101    360     1246.18   185250.00   127589.55   5.250
433933         D.93-2P     Alliance    Fixed   19841201   19850201   20150101    360     1494.87   230000.00   157592.77   5.000
108370768    H.RTC 91-11   Alliance    Fixed   19780601   19780601   20080501    360      305.24    38800.00    14395.55   8.750
108374802    H.RTC 91-11   Alliance    Fixed   19790901   19790901   20090801    360      211.45    21350.00    10913.98  11.500
                           Cenlar/
8945016        C.93-1P     Alliance    Fixed              19930101   20221201    360      442.19    49400.00    32521.16  10.250
                           Cenlar/
8962102        C.93-1P     Alliance    Fixed              19930101   20221201    360      647.30    72000.00    55855.93  10.365
70447651     Q.HEADLANDS   Headlands   Fixed              19970801   20120701    180      542.70    54300.00    40467.54   8.750
70488770     Q.HEADLANDS   Headlands   Fixed              19971001   20270901    360      746.68    96000.00    90646.13   8.625
70356704     Q.HEADLANDS   Headlands   Fixed              19970401   20270301    360     2135.91   268450.00   252818.82   8.875
</TABLE>

<TABLE>
<CAPTION>
                                         Current                          Current
                       WACH                Net   Stated                  Appraised     BPO       Statistical
Loan ID      MSFEE    MSFEE   SFEE       Coupon   REM      Amort           Value      Value         Value
-------      -----    -----   ----       ------   ---      -----           -----      -----         -----
<S>          <C>      <C>     <C>         <C>     <C>  <C>                <C>           <C>      <C>
438046       0.010    0.000   0.250       8.240   35   Fully Amortizing   43650.00      0.00         0.00
433655       0.010    0.000   0.250       9.240   18   Fully Amortizing       0.00      0.00     69000.00
434140       0.010    0.000   0.250       8.990   31   Fully Amortizing   42500.00      0.00         0.00
435372       0.010    0.000   0.250       8.240   57   Fully Amortizing       0.00      0.00         0.00
435634       0.010    0.000   0.250       8.990   59   Fully Amortizing   37500.00      0.00         0.00
433931       0.010    0.000   0.250       4.990  137   Fully Amortizing  195000.00 200000.00         0.00
433933       0.010    0.000   0.250       4.740  139   Fully Amortizing       0.00 388000.00    408000.00
108370768    0.010    0.000   0.250       8.490   59   Fully Amortizing       0.00      0.00         0.00
108374802    0.010    0.000   0.250      11.240   74   Fully Amortizing   22500.00      0.00         0.00
8945016      0.010    0.000   0.250       9.990  234   Fully Amortizing   53004.29      0.00         0.00
8962102      0.010    0.000   0.250      10.105  234   Fully Amortizing   80000.00 120000.00         0.00
70447651     0.010    0.000   0.250       8.490  109   Fully Amortizing   95000.00      0.00         0.00
70488770     0.010    0.000   0.250       8.365  291   Fully Amortizing  120000.00      0.00         0.00
70356704     0.010    0.000   0.250       8.615  285   Fully Amortizing  383500.00      0.00         0.00
</TABLE>


                                       K-1

<PAGE>

<TABLE>
<CAPTION>
                                                                                                                           EXHIBIT L

                                                         Section 3.13 Loans

                                                                                    Stated                                   Current
                                                AM               First Pay Stated  Original             Original   Current    Gross
Loan ID          Pool 1           Servicer     Type   Note Date    Date      MAT     Term     Payment    Balance   Balance    Coupon
-------          ------           --------     ----   ---------    ----      ---     ----     -------    -------   -------    ------
<S>         <C>                 <C>            <C>    <C>        <C>        <C>       <C>      <C>      <C>      <C>           <C>
176616746   A.HANOVER1998-B     Homeside (TX)  Fixed             19741001   2E+07     348      166.09   20500.00    214.51     9.000
1100050187     O.BSMSI 96-4         IMPAC      Fixed  19960909   19961001   2E+07     360     1013.54  123200.00 115536.56     9.250
1100027971     O.BSMSI 96-4         IMPAC      Fixed  19960606   19960701   2E+07     360      638.78   76800.00  71903.93     9.375
1100034870     O.BSMSI 96-4         IMPAC      Fixed  19960701   19960801   2E+07     360      788.30   93750.00  87451.00     9.500
1100075316     P.BSMSI 96-9         IMPAC      Fixed  19961121   19961201   2E+07     360      863.80  109800.00 103083.07     8.750
1100072556     P.BSMSI 96-9         IMPAC      Fixed  19961018   19961201   2E+07     360      605.42   72000.00  67792.43     9.500
503678         N.BSMSI 93-4        Wachovia    Fixed             19930201   2E+07     360      756.35   94000.00  83351.75     9.000
</TABLE>

<TABLE>
<CAPTION>
                                   Current                                             Current
                                     Net      Stated   WACH                           Appraised     BPO   Statistical
Loan ID        MSFEE    SFEE       Coupon      REM     MSFEE              Amort         Value      Value     Value
-------        -----    ----       ------      ---     -----              -----         -----      -----     -----
<S>            <C>      <C>         <C>          <C>   <C>          <C>                <C>         <C>       <C>
176616746      0.010    0.250       8.740        3     0.000        Fully Amortizing   20500.00    0.00      0.00
1100050187     0.010    0.280       8.960      279     0.000        Fully Amortizing  154000.00    0.00      0.00
1100027971     0.010    0.280       9.085      276     0.000        Fully Amortizing   96000.00    0.00      0.00
1100034870     0.010    0.280       9.210      277     0.000        Fully Amortizing  125000.00    0.00      0.00
1100075316     0.010    0.280       8.460      281     0.000        Fully Amortizing  122000.00    0.00      0.00
1100072556     0.010    0.280       9.210      281     0.000        Fully Amortizing  134000.00    0.00      0.00
503678         0.010    0.250       8.650      235     0.090        Fully Amortizing       0.00    0.00 198000.00
</TABLE>

<TABLE>
<CAPTION>
                       BPO                      FICO                                            Loan                        MTG
Loan ID       CLTV     LTV       BPO Source     Score      Type              Doc Type           Purp      OCC Type          Type
-------       ----     ---       ----------     -----      ----              --------           ----      --------          ----
<S>           <C>      <C>     <C>               <C>    <C>             <C>                   <C>       <C>              <C>
176616746     1.05     1.05    Original Value    552    Single Family   Full Documentation    Purchase  Owner Occupied   CONV W/O MI

1100050187   75.02     75.02   Original Value    621    Single Family   Full Documentation    Purchase  Owner Occupied   CONV W/O MI

1100027971   74.90     74.90   Original Value    619    Single Family   Full Documentation    Purchase  Owner Occupied   CONV W/O MI
1100034870   69.96     69.96   Original Value    763    Single Family   Full Documentation    Purchase  Owner Occupied   CONV W/O MI
1100075316   84.49     84.49   Original Value    641    PUD             Full Documentation    Purchase  Owner Occupied   CONV W/O MI
1100072556   50.59     50.59   Original Value    654    Single Family   Full Documentation    Purchase  Owner Occupied   CONV W/O MI
503678        0.00     42.10   Original Value    0      Single Family   Full Documentation    Purchase  Owner Occupied   CONV W/O MI
</TABLE>

                                                                         Zip
Loan ID      Paid To    Delinquency   DQ Hist      City         State    Code
-------      -------    -----------   -------      ----         -----    ----
176616746    20030301     60 DAYS    4 - 3+ x 30   Kearny        AZ     85237

1100050187   20030301     60 DAYS    1 - 0 x 30    Raleigh       NC     27613
                                                   Pembroke
1100027971   20030301     60 DAYS    1 0 0 x 30    PI            FL     33026
1100034870   20030301     60 DAYS    1 - 0 x 30    Roosevelt     NY     11575
1100075316   20030301     60 DAYS    1 - 0 x 30    Lake Mary     FL     32746
1100072556   20030301     60 DAYS    1 - 0 x 30    Tavernier     FL     33070
503678       20030301     60 DAYS    1 - 0 x 30    Sacramento    CA     95821