exv10w8



 





Exhibit 10.8




Execution Copy

May 11, 2007




REDWOOD TRUST, INC.



Purchaser



and



WELLS FARGO BANK, N.A.



Company




 





SELLER’S WARRANTIES AND SERVICING AGREEMENT



Dated as of May 1, 2007




 





Adjustable Rate Mortgage Loans



WFHM 2007-W17 and WFHM 2007-W18




 









 








TABLE OF CONTENTS




	 	 	 	 	 
	ARTICLE I
	 	 	1	 
	 
	 	 	 	 
	DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II
	 	 	14	 
	 
	 	 	 	 
	CONVEYANCE OF MORTGAGE LOANS; POSSESSION OF MORTGAGE FILES;
BOOKS AND RECORDS; CUSTODIAL AGREEMENT; DELIVERY OF DOCUMENTS
	 	 	14	 
	 
	 	 	 	 
	ARTICLE III
	 	 	20	 
	 
	 	 	 	 
	REPRESENTATIONS AND WARRANTIES REMEDIES AND BREACH
	 	 	20	 
	 
	 	 	 	 
	ARTICLE IV
	 	 	42	 
	 
	 	 	 	 
	ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
	 	 	42	 
	 
	 	 	 	 
	ARTICLE V
	 	 	60	 
	 
	 	 	 	 
	PAYMENTS TO PURCHASER
	 	 	60	 
	 
	 	 	 	 
	ARTICLE VI
	 	 	61	 
	 
	 	 	 	 
	GENERAL SERVICING PROCEDURES
	 	 	61	 
	 
	 	 	 	 
	ARTICLE VII
	 	 	66	 
	 
	 	 	 	 
	COMPANY TO COOPERATE
	 	 	66	 
	 
	 	 	 	 
	ARTICLE VIII
	 	 	67	 
	 
	 	 	 	 
	THE COMPANY
	 	 	67	 
	 
	 	 	 	 
	ARTICLE IX
	 	 	68	 
	 
	 	 	 	 
	REMOVAL OF MORTGAGE LOANS FROM AGREEMENT
	 	 	69	 






i









 






	 	 	 	 	 
	ARTICLE X
	 	 	79	 
	 
	 	 	 	 
	DEFAULT
	 	 	79	 
	 
	 	 	 	 
	ARTICLE XI
	 	 	81	 
	 
	 	 	 	 
	TERMINATION
	 	 	81	 
	 
	 	 	 	 
	ARTICLE XII
	 	 	82	 
	 
	 	 	 	 
	MISCELLANEOUS PROVISIONS
	 	 	82	 






EXHIBITS




	 	 	 
	Exhibit A
	 	Mortgage Loan Schedule
	 
	 	(WFHM 2007-W17)
	 
	 	 
	Exhibit A-1
	 	Mortgage Loan Schedule
	 
	 	(WFHM 2007-W18)
	 
	 	 
	Exhibit B
	 	Custodial Agreement
	 
	 	 
	Exhibit C
	 	Contents of Each Custodial Mortgage File; Retained Mortgage File and Servicing File
	 
	 	 
	Exhibit D
	 	Data File Elements
	 
	 	 
	Exhibit E
	 	Form of Opinion of Counsel
	 
	 	 
	Exhibit F
	 	Servicing Criteria
	 
	 	 
	Exhibit G
	 	Sarbanes Certification
	 
	 	 
	Exhibit H
	 	Form of Assignment, Assumption and Recognition Agreement






ii









 






     This is a Seller’s Warranties and Servicing Agreement for adjustable rate residential first
lien mortgage loans, dated and effective as of May 1, 2007, and is executed between Redwood Trust
Inc., as purchaser (the “Purchaser”), and Wells Fargo Bank, N.A., as seller and servicer (the
“Company”).



W I T N E S S E T H 




     WHEREAS, the Purchaser has agreed to purchase from the Company and the Company has agreed to
sell to the Purchaser certain pools of first lien, adjustable rate mortgage loans (each a “Pool”
and collectively, the “Mortgage Loans”) which have an aggregate outstanding principal balance as of
the close of business on the Cut-off Date, after deduction of payments due on or before such date,
whether or not received, as indicated on the related Mortgage Loan Schedule, which are annexed
hereto as Exhibit A and Exhibit A-1;



     WHEREAS, each of the Mortgage Loans is secured by a mortgage, deed of trust or other security
instrument creating a first lien on a residential dwelling located in the jurisdiction indicated on
the related Mortgage Loan Schedule; and



     WHEREAS, the Purchaser and the Company wish to prescribe the manner of purchase of the
Mortgage Loans and the conveyance, servicing and control of the Mortgage Loans.



     NOW, THEREFORE, in consideration of the mutual agreements hereinafter set forth, and for other
good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the
Purchaser and the Company agree as follows:



ARTICLE I



DEFINITIONS




     Whenever used herein, the following words and phrases, unless the content otherwise requires,
shall have the following meanings:



     Accepted Servicing Practices: With respect to any Mortgage Loan, those mortgage
servicing practices of prudent mortgage lending institutions which service mortgage loans of the
same type as the Mortgage Loans in the jurisdiction where the related Mortgaged Property is
located.



     Adjustable Rate Mortgage Loan: A Mortgage Loan which provides for the adjustment of
the Mortgage Interest Rate payable in respect thereto.



1









 





     Adjustment Date: As to each Adjustable Rate Mortgage Loan, the date on which the
Mortgage Interest Rate is adjusted in accordance with the terms of the related Mortgage Note and
Mortgage.



     Agency/Agencies: Fannie Mae or Freddie Mac, or any of them as applicable.



     Agency Transfer: Any sale or transfer of some or all of the Mortgage Loans by the
Purchaser to an Agency which sale or transfer is not a Securitization Transaction or Whole Loan
Transfer.



     Agreement: This Seller’s Warranties and Servicing Agreement and all exhibits,
amendments and supplements hereto.



     ALTA: The American Land Title Association or any successor thereto.



     Appraised Value: With respect to any Mortgage Loan, the lesser of (i) the value set
forth on the appraisal made in connection with the origination of the related Mortgage Loan as the
value of the related Mortgaged Property, or (ii) the purchase price paid for the Mortgaged
Property, provided, however, that in the case of a refinanced Mortgage Loan, such value shall be
based solely on the appraisal made in connection with the origination of such Mortgage Loan.



     Assignment of Mortgage: An assignment of the Mortgage, notice of transfer or
equivalent instrument in recordable form, sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect the sale of the Mortgage to the Purchaser, or if
the related Mortgage has been recorded in the name of MERS or its designee, such actions as are
necessary to cause the Purchaser to be shown as the owner of the related Mortgage on the records of
MERS for purposes of the system of recording transfers of beneficial ownership of mortgages
maintained by MERS.



     Assignment of Mortgage Note and Pledge Agreement: With respect to a Cooperative Loan,
an assignment of the Mortgage Note and Pledge Agreement.



     Assignment of Proprietary Lease: With respect to a Cooperative Loan, an assignment of
the Proprietary Lease sufficient under the laws of the jurisdiction wherein the related Cooperative
Apartment is located to effect the assignment of such Proprietary Lease.



     Business Day: Any day other than (i) a Saturday or Sunday, or (ii) a day on which
banking and savings and loan institutions in the states where the parties are located are
authorized or obligated by law or executive order to be closed.



     Buydown Agreement: An agreement between the Company and a Mortgagor, or an agreement
among the Company, a Mortgagor and a seller of a Mortgaged Property or a third party with respect
to a Mortgage Loan which provides for the application of Buydown Funds.



     Buydown Funds: In respect of any Buydown Mortgage Loan, any amount contributed by the
seller of a Mortgaged Property subject to a Buydown Mortgage Loan, the buyer of such



2









 




property, the Company or any other source, plus any interest earned thereon, in order to enable the
Mortgagor to reduce the payments required to be made from the Mortgagor’s funds during the Buydown
Period.




     Buydown Mortgage Loan: Any Mortgage Loan in respect of which, pursuant to a Buydown
Agreement, (i) the Mortgagor pays less than the full monthly payments specified in the Mortgage
Note for a specified period, and (ii) the difference between the payments required under such
Buydown Agreement and the Mortgage Note is provided from Buydown Funds.



     Buydown Period: The period of time when a Buydown Agreement is in effect with respect
to a related Buydown Mortgage Loan.



     Closing Date: May 24, 2007.



     Code: The Internal Revenue Code of 1986, as it may be amended from time to time or any
successor statute thereto, and applicable U.S. Department of the Treasury regulations issued
pursuant thereto.



     Commission: The United States Securities and Exchange Commission.



     Commitment Letter: That certain letter agreement (i) dated as of April 12, 2007,
relating to the WFHM 2007-W17 Pool and (ii) dated as of April 12, 2007, relating to the WFHM
2007-W18 Pool, each between the Company and the Purchaser.



     Company: Wells Fargo Bank, N.A., or its successor in interest or assigns, or any
successor to the Company under this Agreement appointed as herein provided.



     Company Information: As defined in Section 9.01(e)(i)(A).



     Company Mortgage Loan: A Mortgage Loan that has been underwritten in accordance with
the Company Underwriting Guidelines.



     Company Underwriting Guidelines: The underwriting guidelines of the Company,
applicable to the Company Mortgage Loans, as provided to Purchaser by the Company.



     Condemnation Proceeds: All awards or settlements in respect of a Mortgaged Property,
whether permanent or temporary, partial or entire, by exercise of the power of eminent domain or
condemnation, to the extent not required to be released to a Mortgagor in accordance with the terms
of the related Mortgage Loan Documents.



     Cooperative: The entity that holds title (fee or an acceptable leasehold estate) to
all of the real property that the Project comprises, including the land, separate dwelling units
and all common areas.



     Cooperative Apartment: The specific dwelling unit relating to a Cooperative Loan.



3









 





     Cooperative Lien Search: A search for (a) federal tax liens, mechanics’ liens, lis
pendens, judgments of record or otherwise against (i) the Cooperative, (ii) the seller of the
Cooperative Apartment and (iii) the Mortgagor if the Cooperative Loan is a refinanced Mortgage
Loan, (b) filings of financing statements and (c) the deed of the Project into the Cooperative.



     Cooperative Loan: A Mortgage Loan that is secured by Cooperative Shares and a
Proprietary Lease granting exclusive rights to occupy the related Cooperative Apartment.



     Cooperative Shares: The shares of stock issued by a Cooperative, owned by the
Mortgagor, and allocated to a Cooperative Apartment.



     Covered Loan: A Mortgage Loan categorized as “Covered” pursuant to the Standard &
Poor’s LEVELS® Glossary, Appendix E, in effect on the Closing Date.



     Custodial Account: The separate account or accounts created and maintained pursuant to
Section 4.04.



     Custodial Agreement: The agreement governing the retention of the originals of each
Mortgage Note, Assignment of Mortgage and other applicable Mortgage Loan Documents, which is
annexed hereto as Exhibit B.



     Custodial Mortgage File: With respect to each Mortgage Loan, the file consisting of
the Mortgage Loan Documents listed as items 1 through 5 of Exhibit C attached hereto, which have
been delivered to the Custodian as of the Closing Date.



     Custodian: The custodian under the Custodial Agreement, or its successor in interest
or assigns, or any successor to the Custodian under the Custodial Agreement as provided therein.



     Cut-off Date: May 1, 2007.



     Data File: For each Pool, the electronic data file prepared by the Company and
delivered to the Purchaser which includes the data fields set forth on Exhibit D, with respect to
the Mortgage Loans.



     Deleted Mortgage Loan: A Mortgage Loan which is repurchased by the Company in
accordance with the terms of this Agreement and which is, in the case of a substitution pursuant to
Section 3.03, replaced or to be replaced with a Qualified Substitute Mortgage Loan.



     Depositor: The depositor, as such term is defined in Regulation AB, with respect to
any Securitization Transaction.



     Determination Date: The Business Day immediately preceding the related Remittance
Date.



     Document Transfer Event: The day on which (i) the Company or any successor
thereto is no longer the servicer of any of the Mortgage Loans, (ii) the senior, unsecured
long-term debt



4









 




rating of Wells Fargo & Company is less than “BBB-“ by Fitch, Inc. or (iii) any Rating Agency
requires the Company to deliver the Retained Mortgage Files to the Custodian.




     Due Date: The first day of the month on which the Monthly Payment is due on a
Mortgage Loan, exclusive of any days of grace.



     Due Period: With respect to each Remittance Date, the period commencing on the second
day of the month preceding the month of the Remittance Date and ending on the first day of the
month of the Remittance Date.



     Errors and Omissions Insurance Policy: An errors and omissions insurance policy to be
maintained by the Company pursuant to Section 4.12.



     Escrow Account: The separate account or accounts created and maintained pursuant to
Section 4.06.



     Escrow Payments: With respect to any Mortgage Loan, the amounts constituting ground
rents, taxes, assessments, water rates, sewer rents, municipal charges, mortgage insurance
premiums, fire and hazard insurance premiums, condominium charges, and any other payments required
to be escrowed by the Mortgagor with the mortgagee pursuant to the Mortgage or any other related
document.



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



     Exception Mortgage Loan: A Mortgage Loan that has been underwritten in accordance with
the Company Underwriting Guidelines, but for which one or more exceptions to those guidelines have
been allowed.



     Exchange Act: The Securities and Exchange Act of 1934, as amended.



     Fannie Mae: The Federal National Mortgage Association, or any successor thereto.



     FDIC: The Federal Deposit Insurance Corporation, or any successor thereto.



     Fidelity Bond: A fidelity bond to be maintained by the Company pursuant to Section
4.12.



     First Remittance Date: June 18, 2007.



     Freddie Mac: The Federal Home Loan Mortgage Corporation, or any successor thereto.



     Gross Margin: With respect to each Adjustable Rate Mortgage Loan, the fixed
percentage amount, as indicated on the related Mortgage Loan Schedule, set forth in the related
Mortgage Note which is added to the Index in order to determine the related Mortgage Interest Rate.



5









 





     High Cost Loan: A Mortgage Loan classified as (a) a “high cost” loan under the Home
Ownership and Equity Protection Act of 1994, (b) a “high cost home,” “threshold,” “covered,” “high
risk home,” “predatory” or similar loan under any other applicable state, federal or local law or
(c) categorized as “High Cost” pursuant to the Standard & Poor’s LEVELS® Glossary, Appendix E, in
effect on the Closing Date.



     Index: With respect to any Adjustable Rate Mortgage Loan, the index identified on the
related Data File and set forth in the related Mortgage Note for the purpose of calculating the
interest thereon.



     Insurance Proceeds: With respect to each Mortgage Loan, proceeds of insurance policies
insuring the Mortgage Loan or the related Mortgaged Property.



     Interest Only Mortgage Loan: A Mortgage Loan for which an interest-only payment
feature is allowed during the interest-only period set forth in the related Mortgage Note.



     Lender Paid Mortgage Insurance Policy or LPMI Policy: A PMI Policy for which the
Purchaser or the Company pays all premiums from its own funds, without reimbursement therefor.



     Letter of Credit: With respect to a Pledged Asset Mortgage Loan, a guaranty issued to
the Company by the Pledge Holder for the Pledged Value Amount.



     Liquidation Proceeds: Amounts received in connection with the partial or complete
liquidation of a defaulted Mortgage Loan, whether through the sale or assignment of such Mortgage
Loan, trustee’s sale, foreclosure sale or otherwise, or the sale of the related Mortgaged Property
if the Mortgaged Property is acquired in satisfaction of the Mortgage Loan.



     Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the ratio of the
original loan amount of the Mortgage Loan at its origination (unless otherwise indicated) to the
Appraised Value of the Mortgaged Property.



     Maximum Mortgage Interest Rate: With respect to each Adjustable Rate Mortgage Loan, a
rate that is set forth on the related Mortgage Loan Schedule and in the related Mortgage Note which
is the maximum interest rate to which the Mortgage Interest Rate on such Mortgage Loan may be
increased on any Adjustment Date.



     MERS: Mortgage Electronic Registration Systems, Inc., a Delaware corporation, or any
successor in interest thereto.



     MERS Mortgage Loan: Any Mortgage Loan as to which the related Mortgage or Assignment
of Mortgage has been registered with MERS on the MERS System.



     MERS System: The system of recording transfers of mortgages electronically maintained
by MERS.



6









 





     MIN: The Mortgage Identification Number used to identify mortgage loans registered
under MERS.



     Minimum Mortgage Interest Rate: With respect to each Adjustable Rate Mortgage Loan, a
rate that is set forth in the related Mortgage Note which is the minimum interest rate to which the
Mortgage Interest Rate on such Mortgage Loan may be decreased on any Adjustment Date.



     Monthly Advance: The portion of each Monthly Payment that is delinquent with respect
to each Mortgage Loan at the close of business on the Determination Date required to be advanced by
the Company pursuant to Section 5.03 on the Business Day immediately preceding the Remittance Date
of the related month.



     Monthly Payment: The scheduled monthly payment of principal and interest, or in the
case of an Interest Only Mortgage Loan, payments of (i) interest or (ii) principal and interest, as
applicable, on a Mortgage Loan.



     Mortgage: The mortgage, deed of trust or other instrument securing a Mortgage Note,
which creates a first lien on an unsubordinated estate in fee simple in real property securing the
Mortgage Note or the Pledge Agreement securing the Mortgage Note for a Cooperative Loan.



     Mortgage Impairment Insurance Policy: A mortgage impairment or blanket hazard
insurance policy as described in Section 4.11.



     Mortgage Interest Rate: The annual rate at which interest accrues on a Mortgage Note
from time to time, in accordance with the provisions of the Mortgage Note.



     Mortgage Loan: An individual mortgage loan which is the subject of this Agreement,
each Mortgage Loan originally sold and subject to this Agreement being identified on the related
Mortgage Loan Schedule, which Mortgage Loan includes without limitation the Retained Mortgage File,
the Custodial Mortgage File, the Monthly Payments, Principal Prepayments, Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds, REO Disposition Proceeds and all other rights, benefits,
proceeds and obligations arising from or in connection with such Mortgage Loan. The Mortgage Loans
shall include the Company Mortgage Loans, Exception Mortgage Loans and Third-Party Mortgage Loans.



     Mortgage Loan Documents: With respect to a Mortgage Loan, the documents listed on
Exhibit C attached hereto.



     Mortgage Loan Remittance Rate: With respect to each Mortgage Loan, the annual rate of
interest remitted to the Purchaser, which shall be equal to the related Mortgage Interest Rate
minus the Servicing Fee Rate.



     Mortgage Loan Schedule: For each Pool, a schedule of Mortgage Loans annexed hereto as
Exhibit A and Exhibit A-1, such schedule setting forth the following information with respect to
each Mortgage Loan: (1) the Company’s Mortgage Loan
number; (2) the city, state and zip



7









 




code of the Mortgaged Property; (3) a code indicating whether the Mortgaged Property is a single
family residence, two-family residence, three-family residence, four-family residence, a
Cooperative Apartment, planned unit development or condominium; (4) the Mortgage Interest Rate as
of the Cut-off Date; (5) the Mortgage Loan Remittance Rate as of the Cut-off Date; (6) the Monthly
Payment as of the Cut-off Date; (7) the Gross Margin; (8) the original term to maturity; (9) the
scheduled maturity date; (10) the principal balance of the Mortgage Loan as of the Cut-off Date
after deduction of payments of principal due on or before the Cut-off Date whether or not
collected; (11) the Loan-to-Value Ratio; (12) the next Adjustment Date immediately following the
Cut-off Date; (13) the lifetime Periodic Interest Rate Cap; (14) the type of Adjustable Rate
Mortgage Loan; (15) the Maximum Mortgage Interest Rate; (16) the first Adjustment Date immediately
following origination; (17) whether the Mortgage Loan is convertible or not; (18) a code indicating
the mortgage guaranty insurance company; and (19) the Servicing Fee Rate.




     Mortgage Note: The note or other evidence of the indebtedness of a Mortgagor secured
by a Mortgage and riders thereto.



     Mortgaged Property: The real property securing repayment of the debt evidenced by a
Mortgage Note, or with respect to a Cooperative Loan, the Cooperative Apartment.



     Mortgagor: The obligor on a Mortgage Note.



     Non-Assigned Letter of Credit: A Letter of Credit in which the named beneficiary is
the Company.



     Officer’s Certificate: A certificate signed by the Chairman of the Board or the Vice
Chairman of the Board or the President or a Vice President or an Assistant Vice President and
certified by the Treasurer or the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of the Company, and delivered to the Purchaser as required by this Agreement.



     Opinion of Counsel: A written opinion of counsel, who may be an employee of the
Company, reasonably acceptable to the Purchaser.



     Periodic Interest Rate Cap: As to each Adjustable Rate Mortgage Loan, the maximum
increase or decrease in the Mortgage Interest Rate on any Adjustment Date pursuant to the terms of
the Mortgage Note.



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



     Pledge Account: With respect to a Pledged Asset Mortgage Loan, an account that is
managed by the Pledge Holder to secure a Letter of Credit.



     Pledge Agreement: With respect to a Cooperative Loan, the specific agreement creating
a first lien on and pledge of the Cooperative Shares and the appurtenant
Proprietary Lease.



8









 





     Pledge Holder: With respect to a Pledged Asset Mortgage Loan, the entity that holds the
Pledge Account, manages the Pledge Account and provides the Letter of Credit.



     Pledge Instruments: With respect to a Cooperative Loan, the Stock Power, the
Assignment of the Proprietary Lease and the Assignment of the Mortgage Note and Pledge Agreement.



     Pledged Asset Mortgage Loan: A Mortgage Loan for which the Mortgagor has pledged
financial assets as partial collateral for the Mortgage Loan, in lieu of a cash down payment.



     Pledged Value Amount: With respect to a Pledged Asset Mortgage Loan, a minimum of 20%
of the lower of the Purchase Price or Appraised Value of a Mortgaged Property.



     PMI Policy: A policy of primary mortgage guaranty insurance evidenced by an
electronic form and certificate number issued by a Qualified Insurer, as required by this Agreement
with respect to certain Mortgage Loans. The premiums on a PMI Policy may be paid (i) by the
Mortgagor or (ii) by the Company from its own funds, without reimbursement, in the case of an LPMI
Policy.



     Prepayment Penalty: Payments penalties, fees or charges calculated pursuant to the
Mortgage Note and due pursuant to the terms of the Mortgage Loan as the result of a Principal
Prepayment of the Mortgage Loan, not otherwise due thereon in respect of principal or interest.



     Prime Rate: The prime rate announced to be in effect from time to time, as published
as the average rate in The Wall Street Journal.



     Principal Prepayment: Any payment or other recovery of principal on a Mortgage Loan
which is received in advance of its scheduled Due Date, including any Prepayment Penalty or premium
thereon and which is not accompanied by an amount of interest representing scheduled interest due
on any date or dates in any month or months subsequent to the month of prepayment.



     Principal Prepayment Period: The calendar month preceding the month in which the
related Remittance Date occurs.



     Project: With respect to a Cooperative Loan, all real property owned by the related
Cooperative including the land, separate dwelling units and all common areas.



     Proprietary Lease: With respect to a Cooperative Loan, a lease on a Cooperative
Apartment evidencing the possessory interest of the Mortgagor in such Cooperative Apartment.



     Purchase Price: The purchase price percentage for the Mortgage Loans as specified in
the related Commitment Letter, and as may be adjusted pursuant to such related Commitment Letter.



9









 





     Purchaser: Redwood Trust, Inc., or its successor in interest or any successor to the
Purchaser under this Agreement as herein provided.



     Qualified Correspondent: Any Person from which the Company purchased Mortgage Loans,
provided that the following conditions are satisfied: (i) such Mortgage Loans were originated
pursuant to an agreement between the Company and such Person that contemplated that such Person
would underwrite mortgage loans from time to time, for sale to the Company, in accordance with
underwriting guidelines designated by the Company (“Designated Guidelines”) or guidelines that do
not vary materially from such Designated Guidelines; (ii) such Mortgage Loans were in fact
underwritten as described in clause (i) above and were acquired by the Company within 180 days
after origination; (iii) either (x) the Designated Guidelines were, at the time such Mortgage Loans
were originated, used by the Company in origination of mortgage loans of the same type as the
Mortgage Loans for the Company’s own account or (y) the Designated Guidelines were, at the time
such Mortgage Loans were underwritten, designated by the Company on a consistent basis for use by
lenders in originating mortgage loans to be purchased by the Company; and (iv) the Company
employed, at the time such Mortgage Loans were acquired by the Company, pre-purchase or
post-purchase quality assurance procedures (which may involve, among other things, review of a
sample of mortgage loans purchased during a particular time period or through particular channels)
designed to ensure that Persons from which it purchased mortgage loans properly applied the
underwriting criteria designated by the Company. The Designated Guidelines are the Company
Underwriting Guidelines.



     Qualified Depository: A deposit account or accounts maintained with a federal or state
chartered depository institution the deposits in which are insured by the FDIC to the applicable
limits and the short-term unsecured debt obligations of which (or, in the case of a depository
institution that is a subsidiary of a holding company, the short-term unsecured debt obligations of
such holding company) are rated A-1 by Standard & Poor’s Ratings Services or Prime-1 by Moody’s
Investors Service, Inc. (or a comparable rating if another rating agency is specified by the
Purchaser by written notice to the Company) at the time any deposits are held on deposit therein.



     Qualified Insurer: A mortgage guaranty insurance company duly authorized and licensed
where required by law to transact mortgage guaranty insurance business and approved as an insurer
by Fannie Mae or Freddie Mac.



     Qualified Substitute Mortgage Loan: A mortgage loan eligible to be substituted by the
Company for a Deleted Mortgage Loan which must, on the date of such substitution, (i) have an
outstanding principal balance, after deduction of all scheduled payments due in the month of
substitution (or in the case of a substitution of more than one mortgage loan for a Deleted
Mortgage Loan, an aggregate principal balance), not in excess of the Stated Principal Balance of
the Deleted Mortgage Loan; (ii) have a Mortgage Loan Remittance Rate not less than, and not more
than two percent (2%) greater, than the Mortgage Loan Remittance Rate of the Deleted Mortgage Loan;
(iii) have a remaining term to maturity not greater than and not more than one year less than
that of the Deleted Mortgage Loan; (iv) be of the same type as the Deleted Mortgage Loan and (v)
comply with each representation and warranty set forth in Sections 3.01 and 3.02.



10









 





     Rating Agency: Each of Fitch, Inc., Moody’s Investors Service, Inc., Standard & Poor’s
Ratings Services and DBRS, Inc., or any successor thereto.



     Recognition Agreement: An agreement whereby a Cooperative and a lender with respect to
a Cooperative Loan (i) acknowledge that such lender may make, or intends to make, such Cooperative
Loan, and (ii) make certain agreements with respect to such Cooperative Loan.



     Reconstitution: Any Securitization Transaction, Agency Transfer or Whole Loan
Transfer.



     Reconstitution Agreement: The agreement or agreements entered into by the Company and
the Purchaser and/or certain third parties on the Reconstitution Date or Dates with respect to any
or all of the Mortgage Loans serviced hereunder, in connection with a Whole Loan Transfer, Agency
Transfer or Securitization Transaction.



     Reconstitution Date: The date on which any or all of the Mortgage Loans serviced under
this Agreement shall be reconstituted as part of an Agency Transfer, Securitization Transaction or
Whole Loan Transfer pursuant to Section 9.01 hereof. The Reconstitution Date shall be such date
which the Purchaser shall designate.



     Regulation AB: Subpart 229.1100 — Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to such clarification
and interpretation as have been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the
staff of the Commission, or as may be provided by the Commission or its staff from time to time.



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



     REMIC Provisions: Provisions of the federal income tax law relating to a REMIC, which
appear at Section 860A through 860G of Subchapter M of Chapter 1, Subtitle A of the Code, and
related provisions, regulations, rulings or pronouncements promulgated thereunder, as the foregoing
may be in effect from time to time.



     Remittance Date: The 18th day (or if such 18th day is not a Business Day, the first
Business Day immediately preceding) of any month, beginning with the First Remittance Date.



     REO Disposition: The final sale by the Company of any REO Property.



     REO Disposition Proceeds: All amounts received with respect to an REO Disposition
pursuant to Section 4.16.



     REO Property: A Mortgaged Property acquired by the Company on behalf of the Purchaser
through foreclosure or by deed in lieu of foreclosure, as described in Section 4.16.



11









 





     Repurchase Price: A price equal to (i) the Stated Principal Balance of the Mortgage
Loan as of the date on which such repurchase takes place, plus (ii) interest on such Stated
Principal Balance at the Mortgage Loan Remittance Rate from the date on which interest has last
been paid and distributed to the Purchaser through the last day of the month in which such
repurchase takes place, less amounts received or advanced in respect of such repurchased Mortgage
Loan which are being held in the Custodial Account for distribution in the month of repurchase.



     Retained Mortgage File: With respect to each Mortgage Loan, the file consisting of the
Mortgage Loan Documents listed as items 6 through 12 of Exhibit C attached hereto.



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



     Securitization Transaction: Any transaction involving either (a) a sale or other
transfer of some or all of the Mortgage Loans directly or indirectly to an issuing entity in
connection with an issuance of publicly offered or privately placed, rated or unrated
mortgage-backed securities or (b) an issuance of publicly offered or privately placed, rated or
unrated mortgage-backed securities, the payments on which are determined primarily by reference to
one or more portfolios of residential mortgage loans consisting, in whole or in part, of some or
all of the Mortgage Loans.



     Servicer: As defined in Section 9.01(e)(iii).



     Servicing Advances: All customary, reasonable and necessary “out of pocket” costs and
expenses other than Monthly Advances (including reasonable attorney’s fees and disbursements)
incurred in the performance by the Company of its servicing obligations, including, but not limited
to, the cost of (a) the preservation, restoration and protection of the Mortgaged Property, (b) any
enforcement or judicial proceedings, including foreclosures, (c) the management and liquidation of
any REO Property and (d) compliance with the obligations under Section 4.08 (excluding the
Company’s obligation to pay the premiums on LPMI Policies) and Section 4.10.



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



     Servicing Fee: With respect to each Mortgage Loan, the amount of the annual fee the
Purchaser shall pay to the Company, which shall, for a period of one full month, be equal to
one-twelfth of the product of (a) the Servicing Fee Rate and (b) the unpaid principal balance of
such Mortgage Loan. Such fee shall be payable monthly, computed on the basis of the same principal
amount and period respecting which any related interest payment on a Mortgage Loan is received.
The obligation of the Purchaser to pay the Servicing Fee is limited to, and the Servicing Fee is
payable solely from, the interest portion (including recoveries with respect to interest from
Liquidation Proceeds, to the extent permitted by Section 4.05) of such Monthly Payment collected by
the Company, or as otherwise provided under Section 4.05.



     Servicing Fee Rate: 0.250% per annum per Mortgage Loan.



12









 





     Servicing File: With respect to each Mortgage Loan, the file consisting of the
Mortgage Loan Documents listed as items 13 through 28 of Exhibit C attached hereto plus copies of
all Mortgage Loan Documents contained in the Custodial Mortgage File and the Retained Mortgage
File, which are retained by the Company.



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



     Stated Principal Balance: As to each Mortgage Loan and as of any date of
determination, (i) the principal balance of the Mortgage Loan at the Cut-off Date after giving
effect to payments of principal due on or before such date, whether or not received, minus (ii) all
amounts previously distributed to the Purchaser with respect to the related Mortgage Loan
representing payments or recoveries of principal or advances in lieu thereof.



     Static Pool Information: Static pool information as described in Item 1105(a)(1)-(3)
and 1105(c) of Regulation AB.



     Stock Certificate: With respect to a Cooperative Loan, a certificate evidencing
ownership of the Cooperative Shares issued by the Cooperative.



     Stock Power: With respect to a Cooperative Loan, an assignment of the Stock
Certificate or an assignment of the Cooperative Shares issued by the Cooperative.



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



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



     Subsidy Account: An account maintained by the Company specifically to hold all
Subsidy Funds to be applied to individual Subsidy Loans.



     Subsidy Funds: With respect to any Subsidy Loans, funds contributed by the employer of
a Mortgagor in order to reduce the payments required from the Mortgagor for a specified period in
specified amounts.



     Subsidy Loan: Any Mortgage Loan subject to a temporary interest subsidy agreement
pursuant to which the monthly interest payments made by the related
Mortgagor will be less than



13









 




the scheduled monthly interest payments on such Mortgage Loan, with the resulting difference in
interest payments being provided by the employer of the Mortgagor. Each Subsidy Loan will be
identified as such in the related Data File.




     Third-Party Mortgage Loans: A Mortgage Loan that has been underwritten in accordance
with the related Third-Party Underwriting Guidelines.



     Third-Party Originator: Each Person, other than a Qualified Correspondent, that
originated Mortgage Loans acquired by the Company.



     Third-Party Underwriting Guidelines: The underwriting guidelines of a Third-Party
Originator, as amended from time to time, applicable to the related Third-Party Mortgage Loans, as
provided to the Purchaser by the Company.



     Time$aver® Mortgage Loan: A Mortgage Loan which has been refinanced pursuant to a
Company program that allows a rate/term refinance of an existing Company serviced loan with minimal
documentation.



     Unverified Information: With respect to the Mortgage Loans listed on the related Data
File, information regarding the Mortgagor’s income, source of income, or assets that is stated on
the loan application by the Mortgagor but not verified in the origination process, pursuant to the
applicable Company Underwriting Guidelines (other than the exception identified for Exception
Mortgage Loans) or the Third-Party Underwriting Guidelines, as applicable.



     Whole Loan Transfer: Any sale or transfer of some or all of the Mortgage Loans other
than a Securitization Transaction or Agency Transfer.



ARTICLE II




CONVEYANCE OF MORTGAGE LOANS; POSSESSION OF CUSTODIAL

MORTGAGE FILES; BOOKS AND RECORDS; CUSTODIAL AGREEMENT;

DELIVERY OF DOCUMENTS





			
	Section 2.01	 	Conveyance of Mortgage Loans; Possession of Custodial Mortgage Files; Maintenance of Retained Mortgage File and Servicing Files.





     The Company, simultaneously with the execution and delivery of this Agreement, does hereby
sell, transfer, assign, set over and convey to the Purchaser, without recourse, but subject to the
terms of this Agreement, all the right, title and interest of the Company in and to the Mortgage
Loans, together with the Retained Mortgage Files and Custodial Mortgage Files and all rights and
obligations arising under the documents contained therein. Pursuant to Section 2.03, the Company
has delivered the Custodial Mortgage File for each Mortgage Loan to the Custodian.



14









 





     The contents of each Retained Mortgage File not delivered to the Custodian are and shall be
held in trust by the Company for the benefit of the Purchaser as the owner thereof. Additionally
and separate to the Retained Mortgage File, the Company shall maintain a Servicing File consisting
of a copy of the contents of each Custodial Mortgage File and the Retained Mortgage File. The
possession of each Servicing File and Retained Mortgage File by the Company is at the will of the
Purchaser for the sole purpose of servicing the related Mortgage Loan, and such retention and
possession by the Company is in a custodial capacity only. Upon the sale of the Mortgage Loans the
ownership of each Mortgage Note, the related Mortgage and the related Custodial Mortgage File,
Retained Mortgage File and Servicing File shall vest immediately in the Purchaser, and the
ownership of all records and documents with respect to the related Mortgage Loan prepared by or
which come into the possession of the Company shall vest immediately in the Purchaser and shall be
retained and maintained by the Company, in trust, at the will of the Purchaser and only in such
custodial capacity. The Company shall release its custody of the contents of any Retained Mortgage
File and Servicing File only in accordance with written instructions from the Purchaser or within
sixty (60) days of the occurrence of a Document Transfer Event, unless such release is required as
incidental to the Company’s servicing of the Mortgage Loans or is in connection with a repurchase
of any Mortgage Loan pursuant to Section 3.03 or 6.02. Company shall not be responsible for any
such costs associated with the release, transfer and re-delivery of any Custodial Mortgage Files,
Retained Mortgage Files and/or Servicing Files between the parties unless the Company is releasing,
transferring or re-delivering such Custodial Mortgage Files, Retained Mortgage Files and/or
Servicing Files in connection with the repurchase of such Mortgage Loan pursuant to Section 3.03 or
6.02.



     In addition, in connection with the assignment of any MERS Mortgage Loan, the Company agrees
that it will cause the MERS System to indicate that such Mortgage Loan has been assigned by the
Company to the Purchaser in accordance with this Agreement by including (or deleting, in the case
of a Mortgage Loan repurchased in accordance with this Agreement) in such computer files the
information required by the MERS System to identify the Purchaser as the beneficial owner of such
Mortgage Loan.



Section 2.02 Books and Records; Transfers of Mortgage Loans.




     From and after the sale of the Mortgage Loans to the Purchaser all rights arising out of the
Mortgage Loans, including, but not limited to, all funds received on or in connection with the
Mortgage Loans, shall be received and held by the Company in trust for the benefit of the Purchaser
as owner of the Mortgage Loans, and the Company shall retain record title to the related Mortgages
for the sole purpose of facilitating the servicing and the supervision of the servicing of the
Mortgage Loans.



     The sale of each Mortgage Loan shall be reflected on the Company’s balance sheet and other
financial statements as a sale of assets by the Company. The Company shall be responsible for
maintaining, and shall maintain, a complete set of books and records for each Mortgage Loan which
shall be marked clearly to reflect the ownership of each Mortgage Loan by the Purchaser. In
particular, the Company shall maintain in its
possession, available for inspection by the Purchaser, or its designee, and shall deliver to the
Purchaser upon demand, evidence of



15









 




compliance with all federal, state and local laws, rules and regulations, and requirements of
Fannie Mae or Freddie Mac, including but not limited to documentation as to the method used in
determining the applicability of the provisions of the Flood Disaster Protection Act of 1973, as
amended, to the Mortgaged Property, documentation evidencing insurance coverage and eligibility of
any condominium project for approval by Fannie Mae or Freddie Mac and records of periodic
inspections as required by Section 4.13. To the extent that original documents are not required for
purposes of realization of Liquidation Proceeds or Insurance Proceeds, documents maintained by the
Company may be in the form of microfilm or microfiche or such other reliable means of recreating
original documents, including but not limited to, optical imagery techniques so long as the Company
complies with the requirements of the Fannie Mae or Freddie Mac Selling and Servicing Guide, as
amended from time to time.




     The Company shall maintain with respect to each Mortgage Loan and shall make available for
inspection by the Purchaser or its designee the related Retained Mortgage File and Servicing File
during the time the Purchaser retains ownership of a Mortgage Loan and thereafter in accordance
with applicable laws and regulations.



     The Company shall keep at its servicing office books and records in which, subject to such
reasonable regulations as it may prescribe, the Company shall note transfers of Mortgage Loans. No
transferee of a Mortgage Loan shall be recognized by the Company hereunder unless such transfer is
in compliance with the terms hereof. For the purposes of this Agreement, the Company shall be under
no obligation to deal with any Person with respect to this Agreement or the Mortgage Loans unless
the books and records show such Person as the owner of the Mortgage Loan. The Purchaser may,
subject to the terms of this Agreement, sell and transfer one or more of the Mortgage Loans. The
Purchaser shall advise the Company of the transfer. Upon receipt of notice of the transfer, the
Company shall mark its books and records to reflect the ownership of the Mortgage Loans of such
assignee, and shall release the previous Purchaser from its obligations hereunder with respect to
the Mortgage Loans sold or transferred. Such notification of a transfer shall include a final loan
schedule which shall be received by the Company no fewer than five (5) Business Days before the
last Business Day of the month. If such notification is not received as specified above, the
Company’s duties to remit and report as required by Section 5 shall begin with the next Due Period.



     Upon request from the Purchaser, at the Purchaser’s expense, the Company shall deliver no
later than thirty (30) Business Days after such request any Retained Mortgage File or document
therein, or copies thereof, to the Purchaser at the direction of the Purchaser. An extension of
this date may be requested from the Purchaser, which consent shall not be unreasonably withheld.
The Purchaser shall return any Retained Mortgage File or document therein delivered pursuant to
this Section 2.02 no later than ten (10) Business Days after receipt thereof. In the event that
the Company fails to make delivery of the requested Retained Mortgage File or document therein, or
copies thereof, as required under this Section 2.02, the Company shall repurchase, in accordance
with this Agreement, the related Mortgage Loan within thirty (30) Business Days of a request to do
so by the Purchaser.



Section 2.03 Custodial Agreement; Delivery of Documents.




16









 








     The Company has delivered to the Custodian those Mortgage Loan Documents as contained in the Custodial Mortgage File pursuant to this Agreement with respect to each Mortgage Loan.



     The Custodian has certified its receipt of all such Mortgage Loan Documents in each Custodial Mortgage File required to be delivered pursuant to this Agreement, as evidenced by the trust receipt or initial certification of the Custodian in the form annexed to the Custodial Agreement. The Purchaser will be responsible for the fees and expenses of the Custodian.



     The Company shall forward to the Custodian original documents evidencing an assumption, modification, consolidation or extension of any Mortgage Loan entered into in accordance with Section 4.01 or 6.01 within one (1) week of their execution, provided, however, that the Company shall provide the Custodian with a certified true copy of any such document submitted for recordation within ten (10) days of its
 execution, and shall provide the original of any document submitted for recordation or a copy of such document certified by the appropriate public recording office to be a true and complete copy of the original within sixty (60) days of its submission for recordation.



     In the event the public recording office is delayed in returning any original document, the Company shall deliver to the Custodian within 240 days of its submission for recordation, a copy of such document and an Officer’s Certificate, which shall (i) identify the recorded document; (ii) state that the recorded document has not been delivered to the Custodian due solely to a delay by the
 public recording office, (iii) state the amount of time generally required by the applicable recording office to record and return a document submitted for recordation, and (iv) specify the date the applicable recorded document will be delivered to the Custodian. The Company will be required to deliver the document to the Custodian by the date specified in (iv) above. An extension of the date specified in (iv) above may be requested from the Purchaser, which consent shall not be
 unreasonably withheld.



     Prior to Company’s receipt of the Purchase Price, the Purchaser shall cause the Custodian to act as bailee for the sole and exclusive benefit of the Company pursuant to the Custodial Agreement and act only in accordance with Company’s instructions. Upon the Company’s receipt of the Purchase Price, the Company shall provide notification to the Custodian to release the ownership of the Mortgage
 Loan Documents contained in the Custodial Mortgage File. Such notification shall be in a form of a written notice by facsimile or other electronic media, with a copy sent to the Purchaser. Subsequent to such release, such Mortgage Loan Documents shall be retained by the Custodian for the benefit of the Purchaser. All Mortgage Loan Documents related to Mortgage Loans not purchased by the Purchaser on the Closing Date shall be maintained by the Custodian for the benefit of the Company and shall be returned to the Company
 within two (2) Business Days after the Closing Date.



     In the event that new, replacement, substitute or additional Stock Certificates are issued with respect to existing Cooperative Shares, the Company immediately shall deliver to the Custodian the new Stock Certificates, together with the related Stock Powers in blank. Such new Stock Certificates shall be subject to the related Pledge Instruments and shall be subject to all of the terms, covenants and
conditions of this Agreement.



17









 





Section 2.04 Examination of Mortgage Files.




     Prior to the Closing Date, the Company shall (a) deliver to the Purchaser in escrow, for
examination, the Custodial Mortgage File for each Mortgage Loan, including the Assignment of
Mortgage, pertaining to each Mortgage Loan, and (b) make the Servicing Files and Retained Mortgage
Files available to the Purchaser for examination at the Company’s offices or such other location as
shall otherwise be agreed upon by the Purchaser and the Company. Such examination may be made by
the Purchaser at any time before or after the Closing Date or by any prospective purchaser of the
Mortgage Loans from the Purchaser, at any time after the Closing Date upon prior reasonable notice
to the Company. The fact that the Purchaser or any prospective purchaser of the Mortgage Loans has
conducted or has failed to conduct any partial or complete examination of the Custodial Mortgage
Files, Servicing Files or Retained Mortgage Files shall not affect the Purchaser’s (or any of its
successor’s) rights to demand repurchase, substitution or other relief or remedy as provided under
this Agreement.



Section 2.05 Representations, Warranties and Agreements of Company.




     The Company agrees and acknowledges that it shall, as a condition to the consummation of the
transactions contemplated hereby, make the representations and warranties specified in Section 3.01
and 3.02 of this Agreement, as of the Closing Date. The Company, without conceding that the
Mortgage Loans are securities, hereby makes the following additional representations, warranties
and agreements which shall be deemed to have been made as of the Closing Date:




	 	(a)	 	neither the Company nor anyone acting on its behalf has offered, transferred, pledged, sold or
otherwise disposed of any Mortgage Loans, any interest in any Mortgage Loans or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or other disposition of any
Mortgage Loans, any interest in any Mortgage Loans or any other similar security from, or otherwise
approached or negotiated with respect to any Mortgage Loans, any interest in any Mortgage Loans or
any other similar security with, any Person in any manner, or made any general solicitation by
means of general advertising or in any other manner, or taken any other action which would
constitute a distribution of the Mortgage Loans under the Securities Act or which would render the
disposition of any Mortgage Loans a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will it act, nor has it authorized or will it authorize any
Person to act, in such manner with respect to the Mortgage Loans; and
	 
	 	(b)	 	the Company has not dealt with any broker or agent or anyone else who might be entitled to a
fee or commission in connection with this transaction other than the Purchaser.





Section 2.06 Representation, Warranties and Agreement of Purchaser.




18









 








     The Purchaser, without conceding that the Mortgage Loans are securities, hereby makes the
following representations, warranties and agreements, which shall have been deemed to have been
made as of the Closing Date.




	 	(a)	 	the Purchaser understands that the Mortgage Loans have not been registered under the Securities
Act or the securities laws of any state;
	 
	 	(b)	 	the Purchaser is acquiring the Mortgage Loans for its own account only and not for any other
Person;
	 
	 	(c)	 	the Purchaser considers itself a substantial, sophisticated institutional investor having such
knowledge and experience in financial and business matters that it is capable of evaluating the
merits and risks of investment in the Mortgage Loans;
	 
	 	(d)	 	the Purchaser has been furnished with all information regarding the Mortgage Loans which it has
requested from the Seller; and
	 
	 	(e)	 	neither the Purchaser nor anyone acting on its behalf offered, transferred, pledged, sold or
otherwise disposed of any Mortgage Loan, any interest in any Mortgage Loan or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or other disposition of any
Mortgage Loan, any interest in any Mortgage Loan or any other similar security from, or otherwise
approached or negotiated with respect to any Mortgage Loan, any interest in any Mortgage Loan or
any other similar security with, any Person in any manner, or made any general solicitation by
means of general advertising or in any other manner, or taken any other action which would
constitute a distribution of the Mortgage Loans under the Securities Act or which would render the
disposition of any Mortgage Loan a violation of Section 5 of the Securities Act or require
registration pursuant thereto, nor will it act, nor has it authorized or will it authorize any
Person to act, in such manner with respect to the Mortgage Loans.





Section 2.07 Closing.




     The closing for the purchase and sale of the Mortgage Loans, shall take place on the Closing
Date. At the Purchaser’s option, the closing shall be either: by telephone, confirmed by letter or
wire as the parties shall agree; or conducted in Person, at such place as the parties shall agree.



     The closing shall be subject to each of the following conditions:




	 	(a)	 	all of the representations and warranties of the Company under this Agreement shall be
true and correct as of the Closing Date and no event shall have occurred which, with notice
or the passage of time, would constitute an Event of Default under this Agreement;




19









 






	 	(b)	 	the Purchaser shall have received, or the Purchaser’s attorneys shall have received in
escrow, all closing documents, in such forms as are agreed upon and acceptable to the
Purchaser, duly executed by all signatories other than the Purchaser as required pursuant
to the respective terms thereof;
	 
	 	(c)	 	the Company shall have delivered to the Custodian under this Agreement all documents
required pursuant to this Agreement; and
	 
	 	(d)	 	all other terms and conditions of this Agreement shall have been complied with.





     Subject to the foregoing conditions, the Purchaser shall pay to the Company on the Closing
Date the Purchase Price by wire transfer of immediately available funds to the account designated
by the Company.



Section 2.08 Closing Documents.




     With respect to the Mortgage Loans, the closing documents shall consist of fully executed
originals of the following documents:




	 	(a)	 	this Agreement, dated as of the Cut-off Date, in two counterparts;
	 
	 	(b)	 	the Custodial Agreement, attached as Exhibit B to this Agreement;
	 
	 	(c)	 	the Mortgage Loan Schedules, a copy of each to be attached to each counterpart of this
Agreement;
	 
	 	(d)	 	a trust receipt and certification, as required under the Custodial Agreement;
	 
	 	(e)	 	an
Opinion of Counsel of the Seller, in the form of Exhibit E hereto; and
	 
	 	(f)	 	the Commitment
Letters.





ARTICLE III



REPRESENTATIONS AND WARRANTIES REMEDIES AND BREACH




Section 3.01 Company Representations and Warranties.




     The Company hereby represents and warrants to the Purchaser that, as of the Closing Date:




	 	(a)	 	Due Organization and Authority.




20









 






	 	 	 	The Company is a national banking association duly organized, validly existing and in good
standing under the laws of the United States and has all licenses necessary to carry on
its business as now being conducted and is licensed, qualified and in good standing in
each state where a Mortgaged Property is located if the laws of such state require
licensing or qualification in order to conduct business of the type conducted by the
Company, and in any event the Company is in compliance with the laws of any such state to
the extent necessary to ensure the enforceability of the related Mortgage Loan and the
servicing of such Mortgage Loan in accordance with the terms of this Agreement; the
Company has the full power and authority to execute and deliver this Agreement and to
perform in accordance herewith; the execution, delivery and performance of this Agreement
(including all instruments of transfer to be delivered pursuant to this Agreement) by the
Company and the consummation of the transactions contemplated hereby have been duly and
validly authorized; this Agreement evidences the valid, binding and enforceable obligation
of the Company; and all requisite action has been taken by the Company to make this
Agreement valid and binding upon the Company in accordance with its terms;






	 	(b)	 	Ordinary Course of Business.
	 
	 	 	 	The consummation of the transactions contemplated by this Agreement are in the ordinary course
of business of the Company, who is in the business of selling and servicing loans, and the
transfer, assignment and conveyance of the Mortgage Notes and the Mortgages by the Company pursuant
to this Agreement are not subject to the bulk transfer or any similar statutory provisions in
effect in any applicable jurisdiction;
	 
	 	(c)	 	No Conflicts.
	 
	 	 	 	Neither the execution and delivery of this Agreement, the acquisition of the Mortgage Loans by
the Company, the sale of the Mortgage Loans to the Purchaser or the transactions contemplated
hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement will
conflict with or result in a breach of any of the terms, articles of incorporation or by-laws or
any legal restriction or any agreement or instrument to which the Company is now a party or by
which it is bound, or constitute a default or result in the violation of any law, rule, regulation,
order, judgment or decree to which the Company or its property is subject, or impair the ability of
the Purchaser to realize on the Mortgage Loans, or impair the value of the Mortgage Loans;
	 
	 	(d)	 	Ability to Service.
	 
	 	 	 	The Company is an approved seller/servicer of conventional residential mortgage loans for Fannie
Mae or Freddie Mac, with the facilities, procedures, and experienced personnel necessary for the
sound servicing of mortgage loans of the same type as the Mortgage Loans. The Company is a HUD
approved mortgagee




21









 






	 	 	 	and is in good standing to sell mortgage loans to and service mortgage loans for Fannie Mae or
Freddie Mac, and no event has occurred, including but not limited to a change in insurance
coverage, which would make the Company unable to comply with Fannie Mae or Freddie Mac eligibility
requirements or which would require notification to either Fannie Mae or Freddie Mac;






	 	(e)	 	Reasonable Servicing Fee.
	 
	 	 	 	The Company acknowledges and agrees that the Servicing Fee represents reasonable compensation
for performing such services and that the entire Servicing Fee shall be treated by the Company, for
accounting and tax purposes, as compensation for the servicing and administration of the Mortgage
Loans pursuant to this Agreement;
	 
	 	(f)	 	Ability to Perform.
	 
	 	 	 	The Company does not believe, nor does it have any reason or cause to believe, that it cannot
perform each and every covenant contained in this Agreement. The Company is solvent and the sale of
the Mortgage Loans will not cause the Company to become insolvent. The sale of the Mortgage Loans
is not undertaken to hinder, delay or defraud any of the Company’s creditors;
	 
	 	(g)	 	No Litigation Pending.
	 
	 	 	 	There is no action, suit, proceeding or investigation pending or threatened against the
Company which, either in any one instance or in the aggregate, may result in any material adverse
change in the business, operations, financial condition, properties or assets of the Company, or in
any material impairment of the right or ability of the Company to carry on its business
substantially as now conducted, or in any material liability on the part of the Company, or which
would draw into question the validity of this Agreement or the Mortgage Loans or of any action
taken or to be contemplated herein, or which would be likely to impair materially the ability of
the Company to perform under the terms of this Agreement;
	 
	 	(h)	 	No Consent Required.
	 
	 	 	 	No consent, approval, authorization or order of any court or governmental agency or body is
required for the execution, delivery and performance by the Company of or compliance by the Company
with this Agreement or the sale of the Mortgage Loans as evidenced by the consummation of the
transactions contemplated by this Agreement, or if required, such approval has been obtained prior
to the Closing Date;
	 
	 	(i)	 	Selection Process.




22









 






	 	 	 	The Mortgage Loans were selected from among the outstanding adjustable rate one- to
four-family mortgage loans in the Company’s mortgage banking portfolio at the Closing Date
as to which the representations and warranties set forth in Section 3.02 could be made and
such selection was not made in a manner so as to affect adversely the interests of the
Purchaser;






	 	(j)	 	No Untrue Information.
	 
	 	 	 	Neither this Agreement nor any statement, report or other document furnished or to be
furnished pursuant to this Agreement or in connection with the transactions contemplated hereby
contains any untrue statement of fact or omits to state a fact necessary to make the statements
contained therein not misleading;
	 
	 	(k)	 	Sale Treatment.
	 
	 	 	 	The Company has determined that the disposition of the Mortgage Loans pursuant to this
Agreement will be afforded sale treatment for accounting and tax purposes;
	 
	 	(l)	 	No Material Change.
	 
	 	 	 	There has been no material adverse change in the business, operations, financial condition or
assets of the Company since the date of the Company’s most recent financial statements;
	 
	 	(m)	 	No Brokers’ Fees.
	 
	 	 	 	The Company has not dealt with any broker, investment banker, agent or other Person that may
be entitled to any commission or compensation in the connection with the sale of the Mortgage
Loans; and
	 
	 	(n)	 	MERS.
	 
	 	 	 	The Company is a member of MERS in good standing.





Section 3.02 Representations and Warranties Regarding Individual Mortgage Loans.




     As to each Mortgage Loan, the Company hereby represents and warrants to the Purchaser that as
of the Closing Date:




	 	(a)	 	Mortgage Loans as Described.
	 
	 	 	 	The information set forth in the Mortgage Loan Schedules attached hereto as Exhibit
A and Exhibit A-1 and the information contained on the respective Data Files delivered to
the Purchaser are true and correct; provided that the Company makes no representation or
warranty as to the accuracy of Unverified Information;




23









 












	 	(b)	 	Payments Current.
	 
	 	 	 	All payments required to be made up to the Cut-off Date for the Mortgage Loan under the terms
of the Mortgage Note have been made and credited. No payment under any Mortgage Loan has been
thirty (30) days delinquent more than one (1) time within twelve (12) months prior to the Closing
Date;
	 
	 	(c)	 	No Outstanding Charges.
	 
	 	 	 	There are no defaults in complying with the terms of the Mortgages, and all taxes,
governmental assessments, insurance premiums, leasehold payments, water, sewer and municipal
charges, which previously became due and owing have been paid, or an escrow of funds has been
established in an amount sufficient to pay for every such item which remains unpaid and which has
been assessed but is not yet due and payable. The Company has not advanced funds, or induced, or
solicited directly or indirectly, the payment of any amount required under the Mortgage Loan,
except for interest accruing from the date of the Mortgage Note or date of disbursement of the
Mortgage Loan proceeds, whichever is later, to the day which precedes by one month the Due Date of
the first installment of principal and interest;
	 
	 	(d)	 	Original Terms Unmodified.
	 
	 	 	 	The terms of the Mortgage Note and Mortgage have not been impaired, waived, altered or
modified in any respect, except by a written instrument which has been recorded or registered with
the MERS System, if necessary, to protect the interests of the Purchaser and is retained by the
Company in the Retained Mortgage File; and the related Mortgage Note which has been delivered to
the Custodian. The substance of any such waiver, alteration or modification has been approved by
the issuer of any related PMI Policy and the title insurer, to the extent required by the policy,
and its terms are reflected on the related Mortgage Loan Schedule. No Mortgagor has been released,
in whole or in part, except in connection with an assumption agreement approved by the issuer of
any related PMI Policy and the title insurer, to the extent required by the policy, and which
assumption agreement is part of the Custodial Mortgage File delivered to the Custodian and the
terms of which are reflected in the related Mortgage Loan Schedule;
	 
	 	(e)	 	No Defenses.
	 
	 	 	 	The Mortgage Loan is not subject to any right of rescission, set-off, counterclaim or defense,
including without limitation the defense of usury, nor will the operation of any of the terms of
the Mortgage Note or the Mortgage, or the exercise of any right thereunder, render either the
Mortgage Note or the Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including without limitation the defense of usury,
and no




24









 






	 	 	 	such right of rescission, set-off, counterclaim or defense has been asserted with respect
thereto;






	 	(f)	 	No Satisfaction of Mortgage.
	 
	 	 	 	The Mortgage has not been satisfied, canceled, subordinated or rescinded, in whole or in part,
and the Mortgaged Property has not been released from the lien of the Mortgage, in whole or in
part, nor has any instrument been executed that would effect any such satisfaction, release,
cancellation, subordination or rescission;
	 
	 	(g)	 	Validity of Mortgage Documents.
	 
	 	 	 	The Mortgage Note and the Mortgage and related documents are genuine, and each is the legal,
valid and binding obligation of the maker thereof enforceable in accordance with its terms. All
parties to the Mortgage Note and the Mortgage had legal capacity to enter into the Mortgage Loan
and to execute and deliver the Mortgage Note and the Mortgage, and the Mortgage Note and the
Mortgage have been duly and properly executed by such parties. The Company has reviewed all
documents constituting the Retained Mortgage File and Custodial Mortgage File and has made such
inquiries as it deems necessary to make and confirm the accuracy of the representations set forth
herein;
	 
	 	 	 	With respect to each Cooperative Loan, the Mortgage Note, the Mortgage, the Pledge
Agreement, and related documents are genuine, and each is the legal, valid and binding
obligation of the maker thereof enforceable in accordance with its terms. All parties to
the Mortgage Note, the Mortgage, the Pledge Agreement, the Proprietary Lease, the Stock
Power, Recognition Agreement and the Assignment of Proprietary Lease had legal capacity to
enter into the Mortgage Loan and to execute and deliver such documents, and such documents
have been duly and properly executed by such parties;
	 
	 	(h)	 	No Fraud.
	 
	 	 	 	No error, omission, misrepresentation, negligence, fraud or similar occurrence with respect to
a Mortgage Loan has taken place on the part of the Company, or the Mortgagor (except with respect
to the accuracy of Unverified Information), or to the best of the Company’s knowledge, any
appraiser, any builder, or any developer, or any other party involved in the origination of the
Mortgage Loan or in the application of any insurance in relation to such Mortgage Loan;
	 
	 	(i)	 	Compliance with Applicable Laws.
	 
	 	 	 	Any and all requirements of any federal, state or local law including, without limitation,
usury, truth-in-lending, real estate settlement procedures, consumer credit protection and privacy,
equal credit opportunity, disclosure or predatory




25









 






	 	 	 	and abusive lending laws applicable to the Mortgage Loan have been complied with. All inspections,
licenses and certificates required to be made or issued with respect to all occupied portions of
the Mortgaged Property and, with respect to the use and occupancy of the same, including, but not
limited to, certificates of occupancy and fire underwriting certificates, have been made or
obtained from the appropriate authorities;






	 	(j)	 	Location and Type of Mortgaged Property.
	 
	 	 	 	The Mortgaged Property is located in the state identified in the related Mortgage Loan
Schedule and consists of a contiguous parcel of real property with a detached single family
residence erected thereon, or a two- to four-family dwelling, or an individual condominium
unit in a condominium project, or a Cooperative Apartment, or an individual unit in a
planned unit development or a townhouse, provided, however, that any condominium project or
planned unit development shall conform to the applicable Fannie Mae or Freddie Mac
requirements, the Company Underwriting Guidelines (other than the exception identified for
Exception Mortgage Loans) or the Third-Party Underwriting Guidelines, as applicable,
regarding such dwellings, and no residence or dwelling is a mobile home or manufactured
dwelling. As of the respective appraisal date for each Mortgaged Property, any Mortgaged
Property being used for commercial purposes conforms to the Company Underwriting Guidelines
(other than the exception identified for Exception Mortgage Loans) or the Third-Party
Underwriting Guidelines, as applicable and, to the best of the Company’s knowledge, since
the date of such appraisal, no portion of the Mortgaged Property was being used for
commercial purposes outside of the Company Underwriting Guidelines (other than the
exception identified for Exception Mortgage Loans) or the Third-Party Underwriting
Guidelines, as applicable;
	 
	 	(k)	 	Valid First Lien.
	 
	 	 	 	The Mortgage is a valid, subsisting and enforceable first lien on the Mortgaged Property,
including all buildings on the Mortgaged Property and all installations and mechanical, electrical,
plumbing, heating and air conditioning systems located in or annexed to such buildings, and all
additions, alterations and replacements made at any time with respect to the foregoing. The lien
of the Mortgage is subject only to:






	 	(1)	 	the lien of current real property taxes and assessments not yet due and payable;
	 
	 	(2)	 	covenants, conditions and restrictions, rights of way, easements and other matters of
the public record as of the date of recording acceptable to mortgage lending institutions
generally and specifically referred to in the lender’s title insurance policy delivered to
the originator of the Mortgage Loan and (i) referred to or otherwise considered in the
appraisal made for




26









 






	 	 	 	the originator of the Mortgage Loan and (ii) which do not adversely affect the
Appraised Value of the Mortgaged Property set forth in such appraisal; and






	 	(3)	 	other matters to which like properties are commonly subject which do not materially
interfere with the benefits of the security intended to be provided by the mortgage or the
use, enjoyment, value or marketability of the related Mortgaged Property.






	 	 	 	Any security agreement, chattel mortgage or equivalent document related to and delivered in
connection with the Mortgage Loan establishes and creates a valid, subsisting and
enforceable first lien and first priority security interest on the property described
therein and the Company has full right to sell and assign the same to the Purchaser;
	 
	 	 	 	With respect to each Cooperative Loan, each Pledge Agreement creates a valid, enforceable
and subsisting first security interest in the Cooperative Shares and Proprietary Lease,
subject only to (i) the lien of the related Cooperative for unpaid assessments representing
the Mortgagor’s pro rata share of the Cooperative’s payments for its blanket mortgage,
current and future real property taxes, insurance premiums, maintenance fees and other
assessments to which like collateral is commonly subject and (ii) other matters to which
like collateral is commonly subject which do not materially interfere with the benefits of
the security intended to be provided by the Pledge Agreement; provided, however, that the
appurtenant Proprietary Lease may be subordinated or otherwise subject to the lien of any
mortgage on the Project;






	 	(l)	 	Full Disbursement of Proceeds.
	 
	 	 	 	The proceeds of the Mortgage Loan have been fully disbursed, except for escrows established or
created due to seasonal weather conditions, and there is no requirement for future advances
thereunder. All costs, fees and expenses incurred in making or closing the Mortgage Loan and the
recording of the Mortgage were paid, and the Mortgagor is not entitled to any refund of any amounts
paid or due under the Mortgage Note or Mortgage;
	 
	 	(m)	 	Consolidation of Future Advances.
	 
	 	 	 	Any future advances made prior to the Cut-off Date, have been consolidated with the
outstanding principal amount secured by the Mortgage, and the secured principal amount, as
consolidated, bears a single interest rate and single repayment term reflected on the related
Mortgage Loan Schedule. The lien of the Mortgage securing the consolidated principal amount is
expressly insured as having first lien priority by a title insurance policy, an endorsement to the
policy insuring the mortgagee’s consolidated interest or by other title evidence acceptable to
Fannie Mae or Freddie Mac; the consolidated principal amount does




27









 






	 	 	 	not exceed the original principal amount of the Mortgage Loan; the Company shall not make
future advances after the Cut-off Date;






	 	(n)	 	Ownership.
	 
	 	 	 	The Company is the sole owner of record and holder of the Mortgage Loan and the related
Mortgage Note and the Mortgage are not assigned or pledged, and the Company has good and marketable
title thereto and has full right and authority to transfer and sell the Mortgage Loan to the
Purchaser. The Company is transferring the Mortgage Loan free and clear of any and all
encumbrances, liens, pledges, equities, participation interests, claims, charges or security
interests of any nature encumbering such Mortgage Loan;
	 
	 	(o)	 	Origination/Doing Business.
	 
	 	 	 	The Mortgage Loan was originated by a savings and loan association, a savings bank, a
commercial bank, a credit union, an insurance company, or similar institution that is supervised
and examined by a federal or state authority or by a mortgagee approved by the Secretary of Housing
and Urban Development pursuant to Sections 203 and 211 of the National Housing Act. All parties
which have had any interest in the Mortgage Loan, whether as mortgagee, assignee, pledgee or
otherwise, are (or, during the period in which they held and disposed of such interest, were) (1)
in compliance with any and all applicable licensing requirements of the laws of the state wherein
the Mortgaged Property is located, and (2) organized under the laws of such state, or (3) qualified
to do business in such state, or (4) federal savings and loan associations or national banks having
principal offices in such state, or (5) not doing business in such state;
	 
	 	(p)	 	LTV, PMI Policy.
	 
	 	 	 	No Mortgage Loan has an LTV greater than 95%. Except as set forth on the related Data File,
each Mortgage Loan with an LTV greater than 80% at the time of origination, a portion of the unpaid
principal balance of the Mortgage Loan is and will be insured as to payment defaults by a PMI
Policy. If the Mortgage Loan is insured by a PMI Policy which is not an LPMI Policy, the coverage
will remain in place until (i) the LTV decreases to 78% or (ii) the PMI Policy is otherwise
terminated pursuant to the Homeowners Protection Act of 1998, 12 USC §4901, et seq. All provisions
of such PMI Policy or LPMI Policy have been and are being complied with, such policy is in full
force and effect, and all premiums due thereunder have been paid. The Qualified Insurer has a
claims paying ability acceptable to Fannie Mae or Freddie Mac. Any Mortgage Loan subject to a PMI
Policy or LPMI Policy obligates the Mortgagor or the Company to maintain the PMI Policy or LPMI
Policy, as applicable, and to pay all premiums and charges in connection therewith. The Mortgage
Interest Rate for the Mortgage Loan as set forth on the related Mortgage Loan Schedule is net of
any such insurance premium;




28









 












	 	(q)	 	Title Insurance.
	 
	 	 	 	The Mortgage Loan is covered by an ALTA lender’s title insurance policy (or in the case of any
Mortgage Loan secured by a Mortgaged Property located in a jurisdiction where such policies are
generally not available, an opinion of counsel of the type customarily rendered in such
jurisdiction in lieu of title insurance) or other generally acceptable form of policy of insurance
acceptable to Fannie Mae or Freddie Mac, issued by a title insurer acceptable to Fannie Mae or
Freddie Mac and qualified to do business in the jurisdiction where the Mortgaged Property is
located, insuring the Company, its successors and assigns, as to the first priority lien of the
Mortgage in the original principal amount of the Mortgage Loan, subject only to the exceptions
contained in clauses (1), (2) and (3) of subclause (k) of this Section 3.02, and against any loss
by reason of the invalidity or unenforceability of the lien resulting from the provisions of the
Mortgage providing for adjustment to the Mortgage Interest Rate and Monthly Payment. The Company is
the sole insured of such lender’s title insurance policy, and such lender’s title insurance policy
is in full force and effect and will be in force and effect upon the consummation of the
transactions contemplated by this Agreement. No claims have been made under such lender’s title
insurance policy, and no prior holder of the Mortgage, including the Company, has done, by act or
omission, anything which would impair the coverage of such lender’s title insurance policy;
	 
	 	(r)	 	No Defaults.
	 
	 	 	 	There is no default, breach, violation or event of acceleration existing under the Mortgage or
the Mortgage Note and no event which, with the passage of time or with notice and the expiration of
any grace or cure period, would constitute a default, breach, violation or event of acceleration,
and neither the Company nor its predecessors have waived any default, breach, violation or event of
acceleration;
	 
	 	(s)	 	No Mechanics’ Liens.
	 
	 	 	 	There are no mechanics’ or similar liens or claims which have been filed for work, labor or
material (and no rights are outstanding that under the law could give rise to such liens) affecting
the related Mortgaged Property which are or may be liens prior to, or equal or coordinate with, the
lien of the related Mortgage which are not insured against by the title insurance policy referenced
in subclause (q) of this Section 3.02;
	 
	 	(t)	 	Location of Improvements; No Encroachments.
	 
	 	 	 	Except as insured against by the title insurance policy referenced in subclause (q) of this
Section 3.02, all improvements which were considered in determining the




29









 






	 	 	 	Appraised Value of the Mortgaged Property lay wholly within the boundaries and building
restriction lines of the Mortgaged Property and no improvements on adjoining properties
encroach upon the Mortgaged Property. No improvement located on or being part of the
Mortgaged Property is in violation of any applicable zoning law or regulation;






	 	(u)	 	Payment Terms.
	 
	 	 	 	Except with respect to the Interest Only Mortgage Loans, principal payments commenced no more
than sixty (60) days after the funds were disbursed to the Mortgagor in connection with the
Mortgage Loan. Except with respect to the Interest Only Mortgage Loans, each Mortgage Loan is
payable in equal monthly installments of principal and interest, with interest calculated and
payable in arrears, sufficient to amortize the Mortgage Loan fully by the stated maturity date set
forth in the Mortgage Note over an original term to maturity of not more than thirty (30) years. As
to each Adjustable Rate Mortgage Loan on each applicable Adjustment Date, the Mortgage Interest
Rate will be adjusted to equal the sum of the Index plus the applicable Gross Margin, rounded up or
down to the nearest multiple of 0.125% indicated by the Mortgage Note; provided that the Mortgage
Interest Rate will not increase or decrease by more than the Periodic Interest Rate Cap on any
Adjustment Date, and will in no event exceed the Maximum Mortgage Interest Rate or be lower than
the Minimum Mortgage Interest Rate listed on the Mortgage Note for such Mortgage Loan. As to each
Adjustable Rate Mortgage Loan that is not an Interest Only Mortgage Loan, each Mortgage Note
requires a monthly payment which is sufficient, during the period prior to the first adjustment to
the Mortgage Interest Rate, to fully amortize the outstanding principal balance as of the first day
of such period over the then remaining term of such Mortgage Note and to pay interest at the
related Mortgage Interest Rate. With respect to each Interest Only Mortgage Loan, the interest-only
period shall not exceed fifteen (15) years (or such other period specified on the related Data
File) and following the expiration of such interest-only period, the remaining Monthly Payments
shall be sufficient to fully amortize the original principal balance over the remaining term of the
Mortgage Loan and to pay interest at the related Mortgage Interest Rate. As to each Adjustable Rate
Mortgage Loan, if the related Mortgage Interest Rate changes on an Adjustment Date or, with respect
to an Interest Only Mortgage Loan, on an Adjustment Date following the related interest-only
period, the then outstanding principal balance will be reamortized over the remaining life of such
Mortgage Loan. No Adjustable Rate Mortgage Loan contains terms or provisions which would result in
negative amortization;
	 
	 	(v)	 	Customary Provisions.
	 
	 	 	 	The Mortgage and related Mortgage Note contain customary and enforceable provisions such as to
render the rights and remedies of the holder thereof adequate for the realization against the
Mortgaged Property of the benefits of the security provided thereby, including, (i) in the case of
a Mortgage designated as a




30









 






	 	 	 	deed of trust, by trustee’s sale, and (ii) otherwise by judicial foreclosure. There is no homestead
or other exemption available to a Mortgagor which would interfere with the right to sell the
Mortgaged Property at a trustee’s sale or the right to foreclose the Mortgage;






	 	(w)	 	Occupancy of the Mortgaged Property.
	 
	 	 	 	As of the date of origination, the Mortgaged Property was lawfully occupied under applicable
law;
	 
	 	(x)	 	No Additional Collateral.
	 
	 	 	 	Except in the case of a Pledged Asset Mortgage Loan and as indicated on the related Data File,
the Mortgage Note is not and has not been secured by any collateral, pledged account or other
security except the lien of the corresponding Mortgage and the security interest of any applicable
security agreement or chattel mortgage referred to in subclause (k) of this Section 3.02;
	 
	 	(y)	 	Deeds of Trust.
	 
	 	 	 	In the event the Mortgage constitutes a deed of trust, a trustee, duly qualified under
applicable law to serve as such, has been properly designated and currently so serves and is named
in the Mortgage, and no fees or expenses are or will become payable by the mortgagee to the trustee
under the deed of trust, except in connection with a trustee’s sale after default by the Mortgagor;
	 
	 	(z)	 	Acceptable Investment.
	 
	 	 	 	The Company has no knowledge of any circumstances or conditions with respect to the Mortgage
Loan, the Mortgaged Property, the Mortgagor or the Mortgagor’s credit standing that can reasonably
be expected to cause private institutional investors to regard the Mortgage Loan as an unacceptable
investment, cause the Mortgage Loan to become delinquent, or adversely affect the value or
marketability of the Mortgage Loan;
	 
	 	(aa)	 	Transfer of Mortgage Loans.
	 
	 	 	 	If the Mortgage Loan is not a MERS Mortgage Loan, the Assignment of Mortgage, upon the
insertion of the name of the assignee and recording information, is in recordable form and is
acceptable for recording under the laws of the jurisdiction in which the Mortgaged Property is
located;
	 
	 	(bb)	 	Mortgaged Property Undamaged.
	 
	 	 	 	The Mortgaged Property is undamaged by waste, fire, earthquake or earth movement, windstorm,
flood, tornado or other casualty so as to affect adversely




31









 






	 	 	 	the value of the Mortgaged Property as security for the Mortgage Loan or the use for which the
premises were intended;






	 	(cc)	 	Collection Practices; Escrow Deposits.
	 
	 	 	 	The origination, servicing and collection practices used with respect to the Mortgage Loan
have been in accordance with Accepted Servicing Practices, and have been in all material respects
legal and proper. With respect to escrow deposits and Escrow Payments, all such payments are in
the possession of the Company and there exist no deficiencies in connection therewith for which
customary arrangements for repayment thereof have not been made. All Escrow Payments have been
collected in full compliance with state and federal law. No escrow deposits or Escrow Payments or
other charges or payments due the Company have been capitalized under the Mortgage Note;
	 
	 	(dd)	 	No Condemnation.
	 
	 	 	 	There is no proceeding pending or to the best of the Company’s knowledge threatened for the
total or partial condemnation of the related Mortgaged Property;
	 
	 	(ee)	 	The Appraisal.
	 
	 	 	 	The Servicing File for each Mortgage Loan includes an appraisal of the related Mortgaged
Property. As to each Time$aver® Mortgage Loan, the appraisal may be from the original of the
existing Company-serviced loan, which was refinanced via such Time$aver® Mortgage Loan. The
appraisal was conducted by an appraiser who had no interest, direct or indirect, in the Mortgaged
Property or in any loan made on the security thereof; and whose compensation is not affected by the
approval or disapproval of the Mortgage Loan, and the appraisal and the appraiser both satisfy the
applicable requirements of Title XI of the Financial Institution Reform, Recovery, and Enforcement
Act of 1989 and the regulations promulgated thereunder, all as in effect on the date the Mortgage
Loan was originated;
	 
	 	(ff)	 	Insurance.
	 
	 	 	 	The Mortgaged Property securing each Mortgage Loan is insured by an insurer acceptable to
Fannie Mae or Freddie Mac against loss by fire and such hazards as are covered under a standard
extended coverage endorsement and such other hazards as are customary in the area where the
Mortgaged Property is located pursuant to insurance policies conforming to the requirements of
Section 4.10, in an amount which is at least equal to the lesser of (i) 100% of the insurable
value, on a replacement cost basis, of the improvements on the related Mortgaged Property and (ii)
the greater of (a) the outstanding principal balance of the Mortgage Loan or (b) an amount such
that the proceeds of such insurance shall be




32









 






	 	 	 	sufficient to prevent the application to the Mortgagor or the loss payee of any coinsurance clause
under the policy. If the Mortgaged Property is a condominium unit, it is included under the
coverage afforded by a blanket policy for the project. If the improvements on the Mortgaged
Property are in an area identified in the Federal Register by the Federal Emergency Management
Agency as having special flood hazards, a flood insurance policy meeting the requirements of the
current guidelines of the Federal Insurance Administration is in effect with a generally acceptable
insurance carrier, in an amount representing coverage not less than the least of (A) the
outstanding principal balance of the Mortgage Loan, (B) the full insurable value and (C) the
maximum amount of insurance which was available under the Flood Disaster Protection Act of 1973, as
amended. All individual insurance policies contain a standard mortgagee clause naming the Company
and its successors and assigns as mortgagee, and all premiums thereon have been paid. The Mortgage
obligates the Mortgagor thereunder to maintain a hazard insurance policy at the Mortgagor’s cost
and expense, and on the Mortgagor’s failure to do so, authorizes the holder of the Mortgage to
obtain and maintain such insurance at such Mortgagor’s cost and expense, and to seek reimbursement
therefor from the Mortgagor. The hazard insurance policy is the valid and binding obligation of the
insurer, is in full force and effect, and will be in full force and effect and inure to the benefit
of the Purchaser upon the consummation of the transactions contemplated by this Agreement. The
Company has not acted or failed to act so as to impair the coverage of any such insurance policy or
the validity, binding effect and enforceability thereof;






	 	(gg)	 	Servicemembers Civil Relief Act.
	 
	 	 	 	The Mortgagor has not notified the Company, and the Company has no knowledge of any relief
requested or allowed to the Mortgagor under the Servicemembers Civil Relief Act, as amended;
	 
	 	(hh)	 	No Balloon Payments, Graduated Payments or Contingent Interests.
	 
	 	 	 	The Mortgage Loan is not a graduated payment mortgage loan and the Mortgage Loan does not have
a shared appreciation or other contingent interest feature. No Mortgage Loan has a balloon payment
feature;
	 
	 	(ii)	 	No Construction Loans.
	 
	 	 	 	No Mortgage Loan was made in connection with (i) the construction or rehabilitation of a
Mortgage Property or (ii) facilitating the trade-in or exchange of a Mortgaged Property other than
a construction-to-permanent loan which has converted to a permanent Mortgage Loan;
	 
	 	(jj)	 	Underwriting.




33









 












	 	(i)	 	Each Company Mortgage Loan was underwritten in accordance with the Company Underwriting
Guidelines;
	 
	 	(ii)	 	Each Third-Party Mortgage Loan was underwritten in accordance with the Third-Party
Underwriting Guidelines;
	 
	 	(iii)	 	Each Exception Mortgage Loan was underwritten in accordance with the Company
Underwriting Guidelines; and
	 
	 	(iv)	 	Each Mortgage Note and Mortgage are on forms acceptable to Freddie Mac or Fannie Mae;






	 	(kk)	 	No Bankruptcy.
	 
	 	 	 	No Mortgagor was a debtor in any state or federal bankruptcy or insolvency proceeding at
the time the Mortgage Loan was originated and as of the Closing Date, the Company has not
received notice that any Mortgagor is a debtor under any state or federal bankruptcy or
insolvency proceeding;
	 
	 	(ll)	 	The Mortgagor.
	 
	 	 	 	The Mortgagor is one or more natural Persons and/or an Illinois land trust or a “living trust”
and such “living trust” is in compliance with the Company Underwriting Guidelines (other than the
exception identified for Exception Mortgage Loans) or the Third-Party Underwriting Guidelines, as
applicable;
	 
	 	(mm)	 	Interest Calculation.
	 
	 	 	 	Interest on each Mortgage Loan is calculated on the basis of a 360-day year consisting of
twelve 30-day months;
	 
	 	(nn)	 	Environmental Status.
	 
	 	 	 	There is no pending action or proceeding directly involving the Mortgaged Property of which
the Company is aware in which compliance with any environmental law, rule or regulation is an
issue; and to the best of the Company’s knowledge, nothing further remains to be done to satisfy in
full all requirements of each such law, rule or regulation constituting a prerequisite to the use
and enjoyment of the Mortgaged Property;
	 
	 	(oo)	 	No High Cost Loans.
	 
	 	 	 	No Mortgage Loan is a High Cost Loan or Covered Loan;
	 
	 	(pp)	 	Anti-Money Laundering Laws.




34









 






	 	 	 	The Company has complied with all applicable anti-money laundering laws and regulations, including
without limitation the USA Patriot ACT of 2001 (collectively, the “Anti-Money Laundering Laws”);
the Company has established an anti-money laundering compliance program as required by the
Anti-Money Laundering Laws, has conducted the requisite due diligence in connection with the
origination of each Mortgage Loan for purposes of the Anti-Money Laundering Laws, including with
respect to the indentity of the applicable Mortgagor and the origin of assets used by the said
Mortgagor to purchase the related Mortgaged Property, and maintains sufficient information to
identify the applicable Mortgagor for purposes of the Anti-Money Laundering Laws;






	 	(qq)	 	Single Premium Credit Life Insurance.
	 
	 	 	 	No Mortgagor was required to purchase any single premium credit insurance policy (e.g.
life, disability, accident, unemployment or health insurance product) or debt cancellation
agreement as a condition of obtaining the extension of credit. No Mortgagor obtained a
prepaid single premium credit insurance policy (e.g. life, disability, accident,
unemployment or health insurance product) as part of the origination of the Mortgage Loan.
No proceeds from any Mortgage Loan were used to purchase single premium credit insurance
policies or debt cancellation agreements as part of the origination of, or as a condition
to closing, such Mortgage Loan;
	 
	 	(rr)	 	Buydown Mortgage Loans.
	 
	 	 	 	With respect to each Mortgage Loan that is a Buydown Mortgage Loan:






	 	(i)	 	On or before the date of origination of such Mortgage Loan, the Company and the
Mortgagor, or the Company, the Mortgagor and the seller of the Mortgaged Property or a
third party entered into a Buydown Agreement. The Buydown Agreement provides that the
seller of the Mortgaged Property (or third party) shall deliver to the Company temporary
Buydown Funds in an amount equal to the aggregate undiscounted amount of payments that,
when added to the amount the Mortgagor on such Mortgage Loan is obligated to pay on each
Due Date in accordance with the terms of the Buydown Agreement, is equal to the full
scheduled Monthly Payment due on such Mortgage Loan. The temporary Buydown Funds enable the
Mortgagor to qualify for the Buydown Mortgage Loan. The effective interest rate of a
Buydown Mortgage Loan if less than the interest rate set forth in the related Mortgage Note
will increase within the Buydown Period as provided in the related Buydown Agreement so
that the effective interest rate will be equal to the interest rate as set forth in the
related Mortgage Note. The Buydown Mortgage Loan satisfies the requirements of the Company
Underwriting Guidelines (other than the exception identified for Exception Mortgage Loans)
or the Third-Party Underwriting Guidelines, as applicable;




35









 






	 	(ii)	 	The Mortgage and Mortgage Note reflect the permanent payment terms rather than the payment
terms of the Buydown Agreement. The Buydown Agreement provides for the payment by the Mortgagor of
the full amount of the Monthly Payment on any Due Date that the Buydown Funds are available. The
Buydown Funds were not used to reduce the original principal balance of the Mortgage Loan or to
increase the Appraised Value of the Mortgage Property when calculating the Loan-to-Value Ratios for
purposes of the Agreement and, if the Buydown Funds were provided by the Company and if required
under the Company Underwriting Guidelines (other than the exception identified for Exception
Mortgage Loans) or the Third-Party Underwriting Guidelines, as applicable, the terms of the Buydown
Agreement were disclosed to the appraiser of the Mortgaged Property;
	 
	 	(iii)	 	The Buydown Funds may not be refunded to the Mortgagor unless the Mortgagor makes a
principal payment for the outstanding balance of the Mortgage Loan;
	 
	 	(iv)	 	As of the date of origination of the Mortgage Loan, the provisions of the related
Buydown Agreement complied with the requirements of the Company Underwriting Guidelines
(other than the exception identified for Exception Mortgage Loans) or the Third-Party
Underwriting Guidelines, as applicable, regarding buydown agreements;






	 	(ss)	 	Cooperative Loans.
	 
	 	 	 	With respect to each Cooperative Loan






	 	(i)	 	The Cooperative Shares are held by a Person as a tenant-stockholder in a Cooperative.
Each original UCC financing statement, continuation statement or other governmental filing
or recordation necessary to create or preserve the perfection and priority of the first
lien and security interest in the Cooperative Loan and Proprietary Lease has been timely
and properly made. Any security agreement, chattel mortgage or equivalent document
related to the Cooperative Loan and delivered to Purchaser or its designee establishes in
Purchaser a valid and subsisting perfected first lien on and security interest in the
Mortgaged Property described therein, and Purchaser has full right to sell and assign the
same. The Proprietary Lease term expires no less than five years after the Mortgage Loan
term or such other term acceptable to Fannie Mae, Freddie Mac, the Company Underwriting
Guidelines (other than the exception identified for Exception Mortgage Loans) or the
Third-Party Underwriting Guidelines, as applicable;




36









 






	 	(ii)	 	A Cooperative Lien Search has been made by a company competent to make the same which
company is acceptable to Fannie Mae or Freddie Mac and qualified to do business in the
jurisdiction where the Cooperative is located;
	 
	 	(iii)	 	(a) The term of the related Proprietary Lease is not less than the terms of the
Cooperative Loan; (b) there is no provision in any Proprietary Lease which requires the
Mortgagor to offer for sale the Cooperative Shares owned by such Mortgagor first to the
Cooperative; (c) there is no prohibition in any Proprietary Lease against pledging the
Cooperative Shares or assigning the Proprietary Lease; (d) the Cooperative has been created
and exists in full compliance with the requirements for residential cooperatives in the
jurisdiction in which the Project is located and qualifies as a cooperative housing
corporation under Section 216 of the Code; (e) the Recognition Agreement is on a form
published by Aztech Document Services, Inc. or includes similar provisions; and (f) the
Cooperative has good and marketable title to the Project, and owns the Project either in
fee simple or under a leasehold that complies with the requirements of the Fannie Mae
guidelines, Freddie Mac guidelines, the Company Underwriting Guidelines (other than the
exception identified for Exception Mortgage Loans) or the Third-Party Underwriting
Guidelines, as applicable; such title is free and clear of any adverse liens or
encumbrances, except the lien of any blanket mortgage;
	 
	 	(iv)	 	The Company has the right under the terms of the Mortgage Note, Pledge Agreement and
Recognition Agreement to pay any maintenance charges or assessments owed by the Mortgagor;
and
	 
	 	(v)	 	Each Stock Power (i) has all signatures guaranteed or (ii) if all signatures are not
guaranteed, then such Cooperative Shares will be transferred by the stock transfer agent of
the Cooperative if the Company undertakes to convert the ownership of the collateral
securing the related Cooperative Loan;






	 	(tt)	 	Delivery of Custodial Mortgage Files.
	 
	 	 	 	The Mortgage Note, Assignment of Mortgage and any other documents required to be delivered
by the Company have been delivered to the Custodian in accordance with this Agreement. The
Company is in possession of a complete, true and accurate Retained Mortgage File in
compliance with Exhibit C, except for such documents the originals of which have been
delivered to the Custodian or for such documents where the originals of which have been
sent for recordation;
	 
	 	(uu)	 	Credit Reporting.




37









 






	 	 	 	With respect to each Mortgage Loan, the Company has furnished complete information on the related
borrower credit files to Equifax, Experian and Trans Union Credit Information Company, in
accordance with the Fair Credit Reporting Act and its implementing regulations;






	 	(vv)	 	Contents of Retained Mortgage File.
	 
	 	 	 	The Retained Mortgage File contains the Mortgage Loan Documents listed as items 6 through
12 of Exhibit C attached hereto, except for such documents where the originals of which
have been sent for recordation;
	 
	 	(ww)	 	Pledged Asset Mortgage Loan.
	 
	 	 	 	With respect to a Pledged Asset Mortgage Loan:






	 	(i)	 	The Pledge Holder has a rating of at least “AA” (or the equivalent) or better from at
least two Rating Agencies and the Pledge Holder is obligated to give the beneficiary of
each Letter of Credit at least sixty (60) days notice of any non-renewal of any Letter of
Credit;
	 
	 	(ii)	 	With respect to each Pledged Asset Mortgage Loan, the Company is the named beneficiary
and no Person has drawn any funds against such Letter of Credit;
	 
	 	(iii)	 	Each Letter of Credit is for an amount at least equal to an LTV of 20% of the lower
of the purchase price or the Appraised Value of the related Mortgaged Property;
	 
	 	(iv)	 	As of the Closing Date, the Company has complied with all the requirements of any
Letter of Credit, and each Letter of Credit is a valid and enforceable obligation of the
Pledge Holder;
	 
	 	(v)	 	The Company has the right to draw on each Letter of Credit if the related Pledged Asset
Mortgage Loan becomes ninety (90) days or more delinquent and to apply such proceeds as a
partial prepayment thereon;
	 
	 	(vi)	 	The Company has not received notice of any non-renewal of any Letter of Credit;
	 
	 	(vii)	 	Upon a default by the Pledge Holder, the Company will have a perfected first priority
security interest in the assets pledged to secure the Letter of Credit and has the right to
obtain possession thereof and the right to liquidate such assets and apply the proceeds
thereof to prepay the related Pledged Asset Mortgage Loan; and




38









 






	 	(viii)	 	The Letter of Credit is required to be in effect (either for its original term or
through renewal) until such time as all amounts owed under the related Pledged Asset
Mortgage Loan by the related Mortgagor are less than 80% of the lesser of the Purchase
Price or the Appraised Value of the related Mortgaged Property;






	 	(xx)	 	Indiana.
	 
	 	 	 	There is no Mortgage Loan that was originated on or after January 1, 2005, which is a “high
cost home loan” as defined under the Indiana Home Loan Practices Act (I.C. 24-9); and
	 
	 	(yy)	 	Leasehold Estate.
	 
	 	 	 	With respect to each Mortgage Loan secured in whole or in part by the interest of the
Mortgagor as a lessee under a ground lease of the related Mortgaged Property (a “Ground
Lease”) and not by a fee interest in such Mortgaged Property:






(i) The Mortgagor is the owner of a valid and subsisting interest as tenant under the
Ground Lease;




(ii) The Ground Lease is in full force and effect;




(iii) The Mortgagor is not in default under any provision of the lease;




(iv) The lessor under the Ground Lease is not in default under any of the terms or provisions thereof on the part of the lessor to be observed or performed;




(v) The term of the Ground Lease exceeds the maturity date of the related Mortgage Loan by
at least five (5) years;




(vi) The Mortgagee under the Mortgage Loan is given at least sixty (60) days’ notice of
any default and an opportunity to cure any defaults under the Ground Lease or to take over
the Mortgagor’s rights under the Ground Lease;




(vii) The Ground Lease does not contain any default provisions that could result in
forfeiture or termination of the Ground Lease except for non-payment of the Ground Lease
or a court order;




(viii) The Ground Lease provides that the leasehold can be transferred, mortgaged and
sublet an unlimited number of times either without restriction or on payment of a
reasonable fee and delivery of reasonable documentation to the lessor;




(ix) The Ground Lease or a memorandum thereof has been recorded and by its terms permits
the leasehold estate to be mortgaged; and



39









 






(x) The execution, delivery and performance of the Mortgage do not require consent
(other than those consents which have been obtained and are in full force and
effect) under, and will not contravene any provision of or cause a default under,
the Ground Lease.



Section 3.03 Repurchase.




     It is understood and agreed that the representations and warranties set forth in Sections 3.01
and 3.02 shall survive the sale of the Mortgage Loans to the Purchaser and the delivery of the
applicable Mortgage Loan Documents to the Custodian and shall inure to the benefit of the
Purchaser, notwithstanding any restrictive or qualified endorsement on any Mortgage Note or
Assignment of Mortgage or the examination or failure to examine any Custodial Mortgage File or
Retained Mortgage File. Upon discovery by either the Company or the Purchaser of a breach of any of
the foregoing representations and warranties which materially and adversely affects the value of
the Mortgage Loans or the interest of the Purchaser (or which materially and adversely affects the
interests of Purchaser in the related Mortgage Loan in the case of a representation and warranty
relating to a particular Mortgage Loan), the party discovering such breach shall give prompt
written notice to the other.



     Within ninety (90) days of the earlier of either discovery by or notice to the Company of any
breach of a representation or warranty which materially and adversely affects the value of the
Mortgage Loans, the Company shall use its best efforts promptly to cure such breach in all material
respects and, if such breach cannot be cured, the Company shall, at the Purchaser’s option,
repurchase such Mortgage Loan at the Repurchase Price. In the event that a breach shall involve any
representation or warranty set forth in Section 3.01, and such breach cannot be cured within ninety
(90) days of the earlier of either discovery by or notice to the Company of such breach, all of the
Mortgage Loans shall, at the Purchaser’s option, be repurchased by the Company at the Repurchase
Price. However, if the breach shall involve a representation or warranty set forth in Section 3.02
and the Company discovers or receives notice of any such breach within 120 days of the Closing
Date, the Company shall, if the breach cannot be cured, at the Purchaser’s option and provided that
the Company has a Qualified Substitute Mortgage Loan, rather than repurchase the Mortgage Loan as
provided above, remove such Mortgage Loan (a “Deleted Mortgage Loan”) and substitute in its place a
Qualified Substitute Mortgage Loan or Loans, provided that any such substitution shall be effected
not later than 120 days after the Closing Date. If the Company has no Qualified Substitute Mortgage
Loan, it shall repurchase the deficient Mortgage Loan within ninety (90) days of the written notice
of the breach or the failure to cure, whichever is later. Any repurchase of a Mortgage Loan or
Loans pursuant to the foregoing provisions of this Section 3.03 shall be accomplished by deposit in
the Custodial Account of the amount of the Repurchase Price for distribution to Purchaser on the
Remittance Date immediately following the Principal Prepayment Period in which such Repurchase
Price is received, after deducting therefrom any amount received in respect of such repurchased
Mortgage Loan or Loans and being held in the Custodial Account for future distribution.



     At the time of repurchase or substitution, the Purchaser and the Company shall arrange for the
reassignment of the Deleted Mortgage Loan to the Company and the delivery to the



40









 




Company of any documents held by the Custodian relating to the Deleted Mortgage Loan. If the
Company repurchases a Mortgage Loan that is a MERS Mortgage Loan, the Company shall cause MERS to
designate on the MERS System to remove the Purchaser as the beneficial holder with respect to such
Mortgage Loan. In the event of a repurchase or substitution, the Company shall, simultaneously with
such reassignment, give written notice to the Purchaser that such repurchase or substitution has
taken place, amend the respective Mortgage Loan Schedule to reflect the withdrawal of the Deleted
Mortgage Loan from this Agreement, and, in the case of substitution, identify a Qualified
Substitute Mortgage Loan and amend the respective Mortgage Loan Schedule to reflect the addition of
such Qualified Substitute Mortgage Loan to this Agreement. In connection with any such
substitution, the Company shall be deemed to have made as to such Qualified Substitute Mortgage
Loan the representations and warranties set forth in this Agreement except that all such
representations and warranties set forth in this Agreement shall be deemed made as of the date of
such substitution. The Company shall effect such substitution by delivering to the Custodian for
such Qualified Substitute Mortgage Loan the documents required by Section 2.03, with the Mortgage
Note endorsed as required by Section 2.03. No substitution will be made in any calendar month after
the Determination Date for such month. The Company shall deposit in the Custodial Account the
Monthly Payment less the Servicing Fee due on such Qualified Substitute Mortgage Loan or Loans in
the month following the date of such substitution. Monthly Payments due with respect to Qualified
Substitute Mortgage Loans in the month of substitution shall be retained by the Company. With
respect to any Deleted Mortgage Loan, distributions to Purchaser shall include the Monthly Payment
due on any Deleted Mortgage Loan in the month of substitution, and the Company shall thereafter be
entitled to retain all amounts subsequently received by the Company in respect of such Deleted
Mortgage Loan.




     For any month in which the Company substitutes a Qualified Substitute Mortgage Loan for a
Deleted Mortgage Loan, the Company shall determine the amount (if any) by which the aggregate
principal balance of all Qualified Substitute Mortgage Loans as of the date of substitution is less
than the aggregate Stated Principal Balance of all Deleted Mortgage Loans (after application of
scheduled principal payments due in the month of substitution). The amount of such shortfall shall
be distributed by the Company in the month of substitution pursuant to Section 5.01. Accordingly,
on the date of such substitution, the Company shall deposit from its own funds into the Custodial
Account an amount equal to the amount of such shortfall.



     In addition to such repurchase or substitution obligation, the Company shall indemnify the
Purchaser and hold it harmless against any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments, and other costs and expenses
resulting from any claim, demand, defense or assertion based on or grounded upon, or resulting
from, a breach of the representations and warranties contained in this Agreement. It is understood
and agreed that the obligations of the Company set forth in this Section 3.03 to cure, substitute
for or repurchase a defective Mortgage Loan and to indemnify the Purchaser as provided in this
Section 3.03 constitute the sole remedies of the Purchaser respecting a breach of the foregoing
representations and warranties.



     Any cause of action against the Company relating to or arising out of the breach of any
representations and warranties made in Sections 3.01 and 3.02 shall accrue as to any Mortgage



41









 




Loan upon (i) discovery of such breach by the Purchaser or notice thereof by the Company to the
Purchaser, (ii) failures by the Company to cure such breach or repurchase such Mortgage Loan as
specified above, and (iii) demand upon the Company by the Purchaser for compliance with this
Agreement.




ARTICLE IV



ADMINISTRATION AND SERVICING OF MORTGAGE LOANS




Section 4.01 Company to Act as Servicer.




     The Company, as an independent contractor, shall service and administer the Mortgage Loans and
shall have full power and authority, acting alone or through the utilization of a Subservicer or a
Subcontractor, to do any and all things in connection with such servicing and administration which
the Company may deem necessary or desirable, consistent with the terms of this Agreement and with
Accepted Servicing Practices. The Company shall be responsible for any and all acts of a
Subservicer and a Subcontractor, and the Company’s utilization of a Subservicer or a Subcontractor
shall in no way relieve the liability of the Company under this Agreement.



     Consistent with the terms of this Agreement, the Company may waive, modify or vary any term of
any Mortgage Loan or consent to the postponement of strict compliance with any such term or in any
manner grant indulgence to any Mortgagor if in the Company’s reasonable and prudent determination
such waiver, modification, postponement or indulgence is not materially adverse to the Purchaser,
provided, however, the Company shall not make any future advances, other than Servicing Advances,
with respect to a Mortgage Loan; and provided further, that the Company shall not, unless it has
first obtained the consent of the Purchaser, permit any modification with respect to any Mortgage
Loan that would change the Mortgage Interest Rate, defer or forgive the payment of principal
(except for actual payments of principal), reduce or increase the outstanding principal balance
(except for reductions resulting from actual payments of principal), accept a deed in lieu of
foreclosure or change the final maturity date on such Mortgage Loan or accept substitution of
additional collateral or release any collateral for a Mortgage Loan. The Company shall request
written consent from the Purchaser to permit such a modification and the Purchaser shall provide
written consent or notify the Company of its objection to such modification within three (3)
Business Days of its receipt of the Company’s request. In the event of any such modification which
permits the deferral of interest or principal payments on any Mortgage Loan, the Company shall, on
the Business Day immediately preceding the Remittance Date in any month in which any such principal
or interest payment has been deferred, deposit in the Custodial Account from its own funds, in
accordance with Section 5.03, the difference between (a) such month’s principal and one month’s
interest at the Mortgage Loan Remittance Rate on the unpaid principal balance of such Mortgage Loan
and (b) the amount paid by the Mortgagor. The Company shall be entitled to reimbursement for such
advances to the same extent as for all other advances made pursuant to Section 5.03. Without
limiting the generality of the foregoing, the Company shall continue, and is
hereby authorized



42









 




and empowered, to execute and deliver on behalf of itself and the Purchaser, all instruments of
satisfaction or cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and with respect to the Mortgaged Properties. If
reasonably required by the Company, the Purchaser shall furnish the Company with any powers of
attorney and other documents necessary or appropriate to enable the Company to carry out its
servicing and administrative duties under this Agreement.




     The Company is authorized and empowered by the Purchaser, in its own name, when the Company
believes it appropriate in its reasonable judgment to register any Mortgage Loan on the MERS
System, or cause the removal from MERS registration of any Mortgage Loan on the MERS System, to
execute and deliver, on behalf of the Purchaser, any and all instruments of assignment and other
comparable instruments with respect to such assignment or re-recording of a Mortgage in the name of
MERS, solely as nominee for the Purchaser and its successors and assigns.



     In servicing and administering the Mortgage Loans, the Company shall employ procedures
(including collection procedures) and exercise the same care that it customarily employs and
exercises in servicing and administering mortgage loans for its own account, giving due
consideration to Accepted Servicing Practices where such practices do not conflict with the
requirements of this Agreement, and the Purchaser’s reliance on the Company.



     The Company shall cause to be maintained for each Cooperative Loan a copy of the financing
statements and shall file and such financing statements and continuation statements as necessary,
in accordance with the Uniform Commercial Code applicable in the jurisdiction in which the related
Cooperative Apartment is located, to perfect and protect the security interest and lien of the
Purchaser.



Section 4.02 Liquidation of Mortgage Loans.




     In the event that any payment due under any Mortgage Loan and not postponed pursuant to
Section 4.01 is not paid when the same becomes due and payable, or in the event the Mortgagor fails
to perform any other covenant or obligation under the Mortgage Loan and such failure continues
beyond any applicable grace period, the Company shall take such action as (1) the Company would
take under similar circumstances with respect to a similar mortgage loan held for its own account
for investment, (2) shall be consistent with Accepted Servicing Practices, (3) the Company shall
determine prudently to be in the best interest of Purchaser, and (4) is consistent with any related
PMI Policy. In the event that any payment due under any Mortgage Loan is not postponed pursuant to
Section 4.01 and remains delinquent for a period of 90 days or any other default continues for a
period of ninety (90) days beyond the expiration of any grace or cure period, the Company shall (a)
act in the best interests of the Purchaser, (b) commence foreclosure proceedings, provided that the
Company shall not commence foreclosure proceedings if it receives a written notice from the
Purchaser objecting to such action, no later than the third Business Day prior to such commencement
and (c)
respond to reasonable inquiries of the Purchaser with respect to the Mortgage Loan or related REO
Property. Furthermore, the Purchaser may instruct the Company to commence foreclosure proceedings
on any Mortgage Loan for which any payment remains delinquent for a period of 120 days or more and
shall



43









 




periodically advise the Purchaser, upon receipt of written request, of the status of such
foreclosure proceedings and shall follow the Purchaser’s instruction in connection therewith. In
the event the Purchaser objects to such foreclosure action, the Company shall cease foreclosure
actions and shall not be required to make Monthly Advances with respect to such Mortgage Loan,
pursuant to Section 5.03, and the Company’s obligation to make such Monthly Advances shall
terminate on the 90th day referred to above. In such connection, the Company shall from its own
funds make all necessary and proper Servicing Advances, provided, however, that the Company shall
not be required to expend its own funds in connection with any foreclosure or towards the
restoration or preservation of any Mortgaged Property, unless it shall determine (a) that such
preservation, restoration and/or foreclosure will increase the proceeds of liquidation of the
Mortgage Loan to Purchaser after reimbursement to itself for such expenses and (b) that such
expenses will be recoverable by it either through Liquidation Proceeds (respecting which it shall
have priority for purposes of withdrawals from the Custodial Account pursuant to Section 4.05) or
through Insurance Proceeds (respecting which it shall have similar priority).




     Notwithstanding anything to the contrary contained herein, in connection with a foreclosure or
acceptance of a deed in lieu of foreclosure, in the event the Company has reasonable cause to
believe that a Mortgaged Property is contaminated by hazardous or toxic substances or wastes, or if
the Purchaser otherwise requests an environmental inspection or review of such Mortgaged Property,
such an inspection or review is to be conducted by a qualified inspector. The cost for such
inspection or review shall be borne by the Purchaser. Upon completion of the inspection or review,
the Company shall promptly provide the Purchaser with a written report of the environmental
inspection.



     After reviewing the environmental inspection report, the Purchaser shall determine how the
Company shall proceed with respect to the Mortgaged Property. In the event (a) the environmental
inspection report indicates that the Mortgaged Property is contaminated by hazardous or toxic
substances or wastes and (b) the Purchaser directs the Company to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Company shall be reimbursed for all reasonable
costs associated with such foreclosure or acceptance of a deed in lieu of foreclosure and any
related environmental clean up costs, as applicable, from the related Liquidation Proceeds, or if
the Liquidation Proceeds are insufficient to fully reimburse the Company, the Company shall be
entitled to be reimbursed from amounts in the Custodial Account pursuant to Section 4.05 hereof. In
the event the Purchaser directs the Company not to proceed with foreclosure or acceptance of a deed
in lieu of foreclosure, the Company shall be reimbursed for all Servicing Advances made with
respect to the related Mortgaged Property from the Custodial Account pursuant to Section 4.05
hereof.



Section 4.03 Collection of Mortgage Loan Payments.




     Continuously from the date hereof until the principal and interest on all Mortgage Loans are
paid in full, the Company shall proceed diligently to collect all payments due under each of the
Mortgage Loans when the same shall become due and payable and
shall take special care in ascertaining and estimating Escrow Payments and all other charges that
will become due and payable with respect to the Mortgage Loan and the Mortgaged Property, to the
end that the



44









 




installments payable by the Mortgagors will be sufficient to pay such charges as and when they
become due and payable.




Section 4.04 Establishment of and Deposits to Custodial Account.




     The Company shall segregate and hold all funds collected and received in connection with a
Mortgage Loan separate and apart from any of its own funds and general assets and shall establish
and maintain one or more Custodial Accounts, in the form of time deposit or demand accounts, titled
“Wells Fargo Bank, N.A., in trust for the Purchaser and/or subsequent purchasers of Mortgage Loans
- P & I.” The Custodial Account shall be established with a Qualified Depository. Upon request of
the Purchaser and within ten (10) days thereof, the Company shall provide the Purchaser with
written confirmation of the existence of such Custodial Account. The Custodial Account shall at all
times be insured to the fullest extent allowed by applicable law. Funds deposited in the Custodial
Account may be drawn on by the Company in accordance with Section 4.05.



     The Company shall deposit in the Custodial Account within two (2) Business Days of Company’s
receipt, and retain therein, the following collections received by the Company and payments made by
the Company after the Cut-off Date, other than payments of principal and interest due on or before
the Cut-off Date, or received by the Company prior to the Cut-off Date but allocable to a period
subsequent thereto:




	 	(i)	 	all payments on account of principal on the Mortgage Loans, including all Principal
Prepayments;
	 
	 	(ii)	 	all payments on account of interest on the Mortgage Loans adjusted to the Mortgage Loan
Remittance Rate;
	 
	 	(iii)	 	all Liquidation Proceeds;
	 
	 	(iv)	 	all Insurance Proceeds including amounts required to be deposited pursuant to Section 4.10
(other than proceeds to be held in the Escrow Account and applied to the restoration or repair of
the Mortgaged Property or released to the Mortgagor in accordance with Section 4.14), Section 4.11
and Section 4.15;
	 
	 	(v)	 	all Condemnation Proceeds which are not applied to the restoration or repair of the Mortgaged
Property or released to the Mortgagor in accordance with Section 4.14;
	 
	 	(vi)	 	any amount required to be deposited in the Custodial Account pursuant to Section 4.01, 5.03,
6.01 or 6.02;
	 
	 	(vii)	 	any amounts payable in connection with the repurchase of any Mortgage Loan pursuant to
Section 3.03 and all amounts required to be deposited by the Company in connection with a shortfall
in principal amount of any Qualified Substitute Mortgage
Loan pursuant to Section 3.03;




45









 












	 	(viii)	 	with respect to each Principal Prepayment an amount (to be paid by the Company out of its
funds) which, when added to all amounts allocable to interest received in connection with the
Principal Prepayment, equals one month’s interest on the amount of principal so prepaid at the
Mortgage Loan Remittance Rate;
	 
	 	(ix)	 	any amounts required to be deposited by the Company pursuant to Section 4.11 in connection
with the deductible clause in any blanket hazard insurance policy;
	 
	 	(x)	 	any amounts received with respect to or related to any REO Property and all REO
Disposition Proceeds pursuant to Section 4.16;
	 
	 	(xi)	 	with respect to Buydown Mortgage Loans and Subsidy Loans, an amount from the Escrow Account
that when added to the amount received from the Mortgagor for such month, equal the full Monthly
Payment due under the related Mortgage Note; and
	 
	 	(xii)	 	with respect to Pledged Asset Mortgage Loans, any amount required to be deposited pursuant to
Section 4.26 of this Agreement.





     The foregoing requirements for deposit into the Custodial Account shall be exclusive, it being
understood and agreed that, without limiting the generality of the foregoing, payments in the
nature of late payment charges and assumption fees, to the extent permitted by Section 6.01, need
not be deposited by the Company into the Custodial Account. Any interest paid on funds deposited in
the Custodial Account by the depository institution shall accrue to the benefit of the Company and
the Company shall be entitled to retain and withdraw such interest from the Custodial Account
pursuant to Section 4.05.



Section 4.05 Permitted Withdrawals From Custodial Account.




     The Company shall, from time to time, withdraw funds from the Custodial Account for the
following purposes:




	 	(i)	 	to make payments to the Purchaser in the amounts and in the manner provided for in Section
5.01;
	 
	 	(ii)	 	to reimburse itself for Monthly Advances of the Company’s funds made pursuant to Section 5.03,
the Company’s right to reimburse itself pursuant to this sub clause (ii) being limited to amounts
received on the related Mortgage Loan which represent late Monthly Payments, Liquidation Proceeds,
Condemnation Proceeds, Insurance Proceeds and such other amounts as may be collected by the Company
respecting which any such advance was made, it being understood that, in the case of any such
reimbursement, the Company’s right thereto shall be prior to the rights of Purchaser, except that,
where the Company is required to repurchase a Mortgage Loan pursuant to Section 3.03 or 6.02, the
Company’s right to such reimbursement shall be subsequent to the payment to the Purchaser of the




46









 






	 	 	 	Repurchase Price pursuant to such sections and all other amounts required to be paid to the
Purchaser with respect to such Mortgage Loan;






	 	(iii)	 	to reimburse itself for unreimbursed Servicing Advances, and for any unpaid Servicing Fees,
the Company’s right to reimburse itself pursuant to this sub clause (iii) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds, Condemnation Proceeds, Insurance
Proceeds and such other amounts as may be collected by the Company from the Mortgagor or otherwise
relating to the Mortgage Loan, it being understood that, in the case of any such reimbursement, the
Company’s right thereto shall be prior to the rights of Purchaser, except that where the Company is
required to repurchase a Mortgage Loan pursuant to Section 3.03 or 6.02, in which case the
Company’s right to such reimbursement shall be subsequent to the payment to the Purchaser of the
Repurchase Price pursuant to such sections and all other amounts required to be paid to the
Purchaser with respect to such Mortgage Loan;
	 
	 	(iv)	 	to pay itself interest on funds deposited in the Custodial Account;
	 
	 	(v)	 	to reimburse itself for expenses incurred and reimbursable to it pursuant to Section 8.01;
	 
	 	(vi)	 	to pay any amount required to be paid pursuant to Section 4.16 related to any REO Property, it
being understood that, in the case of any such expenditure or withdrawal related to a particular
REO Property, the amount of such expenditure or withdrawal from the Custodial Account shall be
limited to amounts on deposit in the Custodial Account with respect to the related REO Property;
	 
	 	(vii)	 	to reimburse itself for any Servicing Advances or REO expenses after liquidation of the
Mortgaged Property not otherwise reimbursed above;
	 
	 	(viii)	 	to remove funds inadvertently placed in the Custodial Account by the Company; and
	 
	 	(ix)	 	to clear and terminate the Custodial Account upon the termination of this Agreement.





     In the event that the Custodial Account is interest bearing, on each Remittance Date, the
Company shall withdraw all funds from the Custodial Account except for those amounts which,
pursuant to Section 5.01, the Company is not obligated to remit on such Remittance Date. The
Company may use such withdrawn funds only for the purposes described in this Section 4.05.



Section 4.06 Establishment of and Deposits to Escrow Account.




     The Company shall segregate and hold all funds collected and received pursuant to a Mortgage
Loan constituting Escrow Payments separate and apart from any of its own funds and general assets
and shall establish and maintain one or more Escrow Accounts, in the form of time



47









 




deposit or demand accounts, titled, “Wells Fargo Bank, N.A., in trust for the Purchaser and/or
subsequent purchasers of Residential Mortgage Loans, and various Mortgagors — T & I.” The Escrow
Accounts shall be established with a Qualified Depository, in a manner which shall provide maximum
available insurance thereunder. Upon request of the Purchaser and within ten (10) days thereof, the
Company shall provide the Purchaser with written confirmation of the existence of such Escrow
Account. Funds deposited in the Escrow Account may be drawn on by the Company in accordance with
Section 4.07.




     The Company shall deposit in the Escrow Account or Accounts within two (2) Business Days of
Company’s receipt, and retain therein:




	 	(i)	 	all Escrow Payments collected on account of the Mortgage Loans, for the purpose of effecting
timely payment of any such items as required under the terms of this Agreement;
	 
	 	(ii)	 	all amounts representing Insurance Proceeds or Condemnation Proceeds which are to be applied
to the restoration or repair of any Mortgaged Property;
	 
	 	(iii)	 	all payments on account of Buydown Funds; and
	 
	 	(iv)	 	all Servicing Advances for Mortgagors whose Escrow Payments are insufficient to cover escrow
disbursements.





     The Company shall make withdrawals from the Escrow Account only to effect such payments as are
required under this Agreement, as set forth in Section 4.07. The Company shall be entitled to
retain any interest paid on funds deposited in the Escrow Account by the depository institution,
other than interest on escrowed funds required by law to be paid to the Mortgagor. To the extent
required by law, the Company shall pay interest on escrowed funds to the Mortgagor notwithstanding
that the Escrow Account may be non-interest bearing or that interest paid thereon is insufficient
for such purposes.



Section 4.07 Permitted Withdrawals From Escrow Account.




     Withdrawals from the Escrow Account or Accounts may be made by the Company only:




	 	(i)	 	to effect timely payments of ground rents, taxes, assessments, water rates, mortgage insurance
premiums, condominium charges, fire and hazard insurance premiums or other items constituting
Escrow Payments for the related Mortgage;
	 
	 	(ii)	 	to reimburse the Company for any Servicing Advances made by the Company pursuant to Section
4.08 with respect to a related Mortgage Loan, but only from amounts received on the related
Mortgage Loan which represent late collections of Escrow Payments thereunder;
	 
	 	(iii)	 	to refund to any Mortgagor any funds found to be in excess of the amounts required under the
terms of the related Mortgage Loan;




48









 






	 	(iv)	 	for transfer to the Custodial Account and application to reduce the principal balance of the
Mortgage Loan in accordance with the terms of the related Mortgage and Mortgage Note;
	 
	 	(v)	 	for application to the restoration or repair of the Mortgaged Property in accordance with the
procedures outlined in Section 4.14;
	 
	 	(vi)	 	to pay to the Company, or any Mortgagor to the extent required by law, any interest paid on
the funds deposited in the Escrow Account;
	 
	 	(vii)	 	to remove funds inadvertently placed in the Escrow Account by the Company;
	 
	 	(viii)	 	to transfer payment on account of Buydown Funds and/or Subsidy Funds to the
Custodial Account, as applicable; and
	 
	 	(ix)	 	to clear and terminate the Escrow Account on the termination of this Agreement.





Section 4.08 Payment of Taxes, Insurance and Other Charges.




     With respect to each Mortgage Loan, the Company shall maintain accurate records reflecting the
status of ground rents, taxes, assessments, water rates, sewer rents, and other charges which are
or may become a lien upon the Mortgaged Property and the status of PMI Policy premiums and fire and
hazard insurance coverage and shall obtain, from time to time, all bills for the payment of such
charges (including renewal premiums) and shall effect payment thereof prior to the applicable
penalty or termination date, employing for such purpose deposits of the Mortgagor in the Escrow
Account which shall have been estimated and accumulated by the Company in amounts sufficient for
such purposes, as allowed under the terms of the Mortgage. The Company assumes full responsibility
for the timely payment of all such bills and shall effect timely payment of all such charges
irrespective of each Mortgagor’s faithful performance in the payment of same or the making of the
Escrow Payments, and the Company shall make advances from its own funds to effect such payments.



Section 4.09 Protection of Accounts.




     The Company may transfer the Custodial Account, Subsidy Account or the Escrow Account to a
different Qualified Depository from time to time, provided that the Company shall give notice to
the Purchaser of such transfer.



Section 4.10 Maintenance of Hazard Insurance.




     The Company shall cause to be maintained for each Mortgage Loan hazard insurance such that
all buildings upon the Mortgaged Property are insured by an insurer acceptable to Fannie Mae or
Freddie Mac against loss by fire, hazards of extended coverage and such other hazards as are
customary in the area where the Mortgaged Property is located, in an amount which is at least equal
to the lesser of (i) 100% of the insurable value, on a replacement cost



49









 




basis, of the improvements on the related Mortgaged Property and (ii) the greater of (a) the
outstanding principal balance of the Mortgage Loan or (b) an amount such that the proceeds of such
insurance shall be sufficient to prevent the application to the Mortgagor or the loss payee of any
coinsurance clause under the policy. In the event a hazard insurance policy shall be in danger of
being terminated, or in the event the insurer shall cease to be acceptable to Fannie Mae or Freddie
Mac, the Company shall notify the Purchaser and the related Mortgagor, and shall use its best
efforts, as permitted by applicable law, to obtain from another qualified insurer a replacement
hazard insurance policy substantially and materially similar in all respects to the original
policy. In no event, however, shall a Mortgage Loan be without a hazard insurance policy at any
time, subject only to Section 4.11 hereof.




     If the related Mortgaged Property is located in an area identified by the Federal Emergency
Management Agency as having special flood hazards (and such flood insurance has been made
available) a flood insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable insurance carrier
acceptable to Fannie Mae or Freddie Mac in an amount representing coverage equal to the lesser of
(i) the minimum amount required, under the terms of coverage, to compensate for any damage or loss
on a replacement cost basis (or the unpaid balance of the mortgage if replacement cost coverage is
not available for the type of building insured) and (ii) the maximum amount of insurance which is
available under the Flood Disaster Protection Act of 1973, as amended. If at any time during the
term of the Mortgage Loan, the Company determines in accordance with the applicable law and
pursuant to the Fannie Mae or Freddie Mac guide, that the Mortgaged Property is located in a
special flood hazard area and is not covered by flood insurance or is covered in an amount less
than the amount required by the Flood Disaster Protection Act of 1973, as amended, the Company
shall notify the related Mortgagor that the Mortgagor must obtain such flood insurance coverage,
and if the Mortgagor fails to obtain the required flood insurance coverage within forty-five (45)
days after such notification, the Company shall force place the required flood insurance on the
Mortgagor’s behalf.



     If a Mortgage is secured by a unit in a condominium project, the Company shall verify that the
coverage required of the owner’s association, including hazard, flood, liability, and fidelity
coverage, is being maintained in accordance with then current Fannie Mae requirements, and secure
from the owner’s association its agreement to notify the Company promptly of any change in the
insurance coverage or of any condemnation or casualty loss that may have a material effect on the
value of the Mortgaged Property as security.



     In the event that any Purchaser or the Company shall determine that the Mortgaged Property
should be insured against loss or damage by hazards and risks not covered by the insurance required
to be maintained by the Mortgagor pursuant to the terms of the Mortgage, the Company shall
communicate and consult with the Mortgagor with respect to the need for such insurance and bring to
the Mortgagor’s attention the desirability of protection of the Mortgaged Property.



     All policies required hereunder shall name the Company as loss payee and shall be endorsed
with standard or union mortgagee clauses, without contribution, which shall provide



50









 




for at least thirty (30) days prior written notice of any cancellation, reduction in amount or
material change in coverage.




     The Company shall not interfere with the Mortgagor’s freedom of choice in selecting either his
insurance carrier or agent, provided, however, that the Company shall not accept any such insurance
policies from insurance companies unless such companies are acceptable to Fannie Mae and Freddie
Mac and are licensed to do business in the jurisdiction in which the Mortgaged Property is located.
The Company shall determine that such policies provide sufficient risk coverage and amounts, that
they insure the property owner, and that they properly describe the property address.



     Pursuant to Section 4.04, any amounts collected by the Company under any such policies (other
than amounts to be deposited in the Escrow Account and applied to the restoration or repair of the
related Mortgaged Property, or property acquired in liquidation of the Mortgage Loan, or to be
released to the Mortgagor, in accordance with the Company’s normal servicing procedures as
specified in Section 4.14) shall be deposited in the Custodial Account subject to withdrawal
pursuant to Section 4.05.



Section 4.11 Maintenance of Mortgage Impairment Insurance.




     In the event that the Company shall obtain and maintain a blanket policy insuring against
losses arising from fire and hazards covered under extended coverage on all of the Mortgage Loans,
then, to the extent such policy provides coverage in an amount equal to the amount required
pursuant to Section 4.10 and otherwise complies with all other requirements of Section 4.10, it
shall conclusively be deemed to have satisfied its obligations as set forth in Section 4.10. The
Company shall prepare and make any claims on the blanket policy as deemed necessary by the Company
in accordance with Accepted Servicing Practices. Any amounts collected by the Company under any
such policy relating to a Mortgage Loan shall be deposited in the Custodial Account subject to
withdrawal pursuant to Section 4.05. Such policy may contain a deductible clause, in which case, in
the event that there shall not have been maintained on the related Mortgaged Property a policy
complying with Section 4.10, and there shall have been a loss which would have been covered by such
policy, the Company shall deposit in the Custodial Account at the time of such loss the amount not
otherwise payable under the blanket policy because of such deductible clause, such amount to be
deposited from the Company’s funds, without reimbursement therefor. Upon request of the Purchaser,
the Company shall cause to be delivered to such Purchaser a certificate of insurance and a
statement from the insurer thereunder that such policy shall in no event be terminated or
materially modified without thirty (30) days’ prior written notice to such Purchaser.



Section 4.12 Maintenance of Fidelity Bond and Errors and Omissions Insurance.




     The Company shall maintain with responsible companies, at its own expense, a blanket
Fidelity Bond and an Errors and Omissions Insurance Policy, with broad coverage on all officers,
employees or other Persons acting in any capacity requiring such Persons to handle funds, money,
documents or papers relating to the Mortgage Loans (“Company Employees”). Any such Fidelity Bond
and Errors and Omissions Insurance Policy shall be in the form of the



51









 




Mortgage Banker’s Blanket Bond and shall protect and insure the Company against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and negligent acts of such
Company Employees. Such Fidelity Bond and Errors and Omissions Insurance Policy also shall protect
and insure the Company against losses in connection with the release or satisfaction of a Mortgage
Loan without having obtained payment in full of the indebtedness secured thereby. No provision of
this Section 4.12 requiring such Fidelity Bond and Errors and Omissions Insurance Policy shall
diminish or relieve the Company from its duties and obligations as set forth in this Agreement. The
minimum coverage under any such Fidelity Bond and Errors and Omissions Insurance Policy shall be
acceptable to Fannie Mae or Freddie Mac. Upon the request of any Purchaser, the Company shall
cause to be delivered to such Purchaser a certificate of insurance for such Fidelity Bond and
Errors and Omissions Insurance Policy and a statement from the surety and the insurer that such
Fidelity Bond and Errors and Omissions Insurance Policy shall in no event be terminated or
materially modified without thirty (30) days’ prior written notice to the Purchaser.




Section 4.13 Inspections.




     If any Mortgage Loan is more than sixty (60) days delinquent and the Company has not entered
into any temporary alternative repayment arrangements with the related Mortgagor, the Company or
its agent shall inspect the Mortgaged Property in accordance with Accepted Servicing Practices or
as may be required by the primary mortgage guaranty insurer, to assure that the value of the
Mortgaged Property is being preserved. The Company shall keep a record of each such inspection and,
upon request, shall provide the Purchaser with an electronic report of each such inspection.



Section 4.14 Restoration of Mortgaged Property.




     The Company need not obtain the approval of the Purchaser prior to releasing any Insurance
Proceeds or Condemnation Proceeds to the Mortgagor to be applied to the restoration or repair of
the Mortgaged Property if such release is in accordance with Accepted Servicing Practices. For
claims greater than $15,000, at a minimum the Company shall comply with the following conditions in
connection with any such release of Insurance Proceeds or Condemnation Proceeds:




(i) the Company shall receive satisfactory independent verification of completion of
repairs and issuance of any required approvals with respect thereto;




(ii) the Company shall take all steps necessary to preserve the priority of the lien of the
Mortgage, including, but not limited to requiring waivers with respect to mechanics’ and
materialmen’s liens;




(iii) the Company shall verify that the Mortgage Loan is not in default; and




(iv) pending repairs or restoration, the Company shall place the Insurance Proceeds or Condemnation
Proceeds in the Escrow Account.



52









 





     If the Purchaser is named as an additional loss payee, the Company is hereby empowered to
endorse any loss draft issued in respect of such a claim in the name of the Purchaser.



Section 4.15 Maintenance of PMI Policy; Claims.




     Except as indicated on the related Data File, for each Mortgage Loan with an LTV in excess of
80% at the time of origination, the Company shall, without any cost to the Purchaser maintain or
cause the Mortgagor to maintain in full force and effect a PMI Policy insuring the portion of the
unpaid principal balance of the Mortgage Loan as to payment defaults. If the Mortgage Loan is
insured by a PMI Policy for which the Mortgagor pays all premiums, the coverage will remain in
place until (i) the LTV decreases to 78% or (ii) the PMI Policy is otherwise terminated pursuant to
the Homeowners Protection Act of 1998, 12 USC §4901, et seq. In the event that such PMI Policy
shall be terminated other than as required by law, the Company shall obtain from another Qualified
Insurer a comparable replacement policy, with a total coverage equal to the remaining coverage of
such terminated PMI Policy. If the insurer shall cease to be a Qualified Insurer, the Company shall
determine whether recoveries under the PMI Policy are jeopardized for reasons related to the
financial condition of such insurer, it being understood that the Company shall in no event have
any responsibility or liability for any failure to recover under the PMI Policy for such reason. If
the Company determines that recoveries are so jeopardized, it shall notify the Purchaser and the
Mortgagor, if required, and obtain from another Qualified Insurer a replacement insurance policy.
The Company shall not take any action which would result in noncoverage under any applicable PMI
Policy of any loss which, but for the actions of the Company would have been covered thereunder. In
connection with any assumption or substitution agreement entered into or to be entered into
pursuant to Section 6.01, the Company shall promptly notify the insurer under the related PMI
Policy, if any, of such assumption or substitution of liability in accordance with the terms of
such PMI Policy and shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under such PMI Policy. If such PMI Policy is terminated as a result
of such assumption or substitution of liability, the Company shall obtain a replacement PMI Policy
as provided above.



     In connection with its activities as servicer, the Company agrees to prepare and present, on
behalf of itself and the Purchaser, claims to the insurer under any PMI Policy in a timely fashion
in accordance with the terms of such PMI Policy and, in this regard, to take such action as shall
be necessary to permit recovery under any PMI Policy respecting a defaulted Mortgage Loan. Pursuant
to Section 4.04, any amounts collected by the Company under any PMI Policy shall be deposited in
the Custodial Account, subject to withdrawal pursuant to Section 4.05.



Section 4.16 Title, Management and Disposition of REO Property.




     Subject to Section 4.02, in the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale shall be taken in
the name of the Purchaser or the Purchaser’s designee, or in the event the Purchaser is not
authorized or permitted to hold title to real property in the state where
the REO Property is located, or would be adversely affected under the “doing business” or tax laws
of such state by so holding title, the deed or certificate of sale shall be taken in the name of
such Person or Persons as shall



53









 




be consistent with an Opinion of Counsel obtained by the Company from any attorney duly licensed to
practice law in the state where the REO Property is located. The Person or Persons holding such
title other than the Purchaser shall acknowledge in writing that such title is being held as
nominee for the Purchaser.




     The Company shall manage, conserve, protect and operate each REO Property for the Purchaser
solely for the purpose of its prompt disposition and sale. The Company, either itself or through an
agent selected by the Company, shall manage, conserve, protect and operate the REO Property in the
same manner that it manages, conserves, protects and operates other foreclosed property for its own
account, and in the same manner that similar property in the same locality as the REO Property is
managed. The Company shall attempt to sell the same (and may temporarily rent the same for a period
not greater than one year, except as otherwise provided below) on such terms and conditions as the
Company deems to be in the best interest of the Purchaser.



     The Company shall use its best efforts to dispose of the REO Property as soon as possible and
shall sell such REO Property in any event prior to the close of the third calendar year beginning
after the year in which title has been taken to such REO Property, unless (i) a REMIC election has
not been made with respect to the arrangement under which the Mortgage Loans and the REO Property
are held, and (ii) the Company determines that a longer period is necessary for the orderly
liquidation of such REO Property. If a period longer than three years is permitted under the
foregoing sentence, (i) the Company shall report monthly to the Purchaser as to the progress being
made in selling such REO Property and (ii) if a purchase money mortgage is taken in connection with
such sale, such purchase money mortgage (1) shall name the Company as mortgagee, and (2) shall not
be held pursuant to this Agreement.



     The Company shall also maintain on each REO Property fire and hazard insurance with extended
coverage in amount which is at least equal to the maximum insurable value of the improvements which
are a part of such property, liability insurance and, to the extent required and available under
the Flood Disaster Protection Act of 1973, as amended, flood insurance in the amount required
above.



     The disposition of REO Property shall be carried out by the Company at such price, and upon
such terms and conditions, as the Company deems to be in the best interests of the Purchaser;
provided, however, that the Company, prior to any such disposition, shall notify the Purchaser in
writing of such price, terms and conditions and shall proceed with such disposition only if the
Company is not otherwise directed by the Purchaser, in a writing delivered to the Company, not
later than the second Business Day following the Company’s delivery of such notice to the
Purchaser. The proceeds of sale of the REO Property shall be promptly deposited in the Custodial
Account. As soon as practical thereafter the expenses of such sale shall be paid and the Company
shall reimburse itself for any related unreimbursed Servicing Advances, unpaid Servicing Fees and
unreimbursed advances made pursuant to Section 5.03. On the Remittance Date immediately following
the Principal Prepayment Period in which such sale proceeds are received the net cash proceeds of
such sale remaining in the Custodial Account shall be
distributed to the Purchaser.




54









 





     The Company shall withdraw from the Custodial Account funds necessary for the proper
operation management and maintenance of the REO Property, including the cost of maintaining any
hazard insurance pursuant to Section 4.10 and the fees of any managing agent of the Company, or the
Company itself. The Company shall make monthly distributions on each Remittance Date to the
Purchaser of the net cash flow from the REO Property (which shall equal the revenues from such REO
Property net of the expenses described in this Section 4.16 and of any reserves reasonably required
from time to time to be maintained to satisfy anticipated liabilities for such expenses).



Section 4.17 Real Estate Owned Reports.




     Together with the statement furnished pursuant to Section 5.02, the Company shall furnish to
the Purchaser on or before the Remittance Date each month a statement with respect to any REO
Property covering the operation of such REO Property for the previous month and the Company’s
efforts in connection with the sale of such REO Property and any rental of such REO Property
incidental to the sale thereof for the previous month. That statement shall be accompanied by such
other information available to the Company as the Purchaser shall reasonably request.



Section 4.18 Liquidation Reports.



     Upon the foreclosure sale of any Mortgaged Property or the acquisition thereof by the
Purchaser pursuant to a deed in lieu of foreclosure, the Company shall submit to the Purchaser a
liquidation report with respect to such Mortgaged Property.



Section 4.19 Reports of Foreclosures and Abandonments of Mortgaged Property.



     Following the foreclosure sale or abandonment of any Mortgaged Property, the Company shall
report such foreclosure or abandonment as required pursuant to Section 6050J of the Code. The
Company shall file information reports with respect to the receipt of mortgage interest received in
a trade or business and information returns relating to cancellation of indebtedness income with
respect to any Mortgaged Property as required by the Code. Such reports shall be in form and
substance sufficient to meet the reporting requirements imposed by the Code.



Section 4.20 Application of Buydown Funds.



     With respect to each Buydown Mortgage Loan, the Company shall have deposited into the Escrow
Account, no later than the last day of the month, Buydown Funds in an amount equal to the aggregate
undiscounted amount of payments that, when added to the amount the Mortgagor on such Mortgage Loan
is obligated to pay on all Due Dates in accordance with the terms of the Buydown Agreement, is
equal to the full scheduled Monthly Payments which are required to be paid by the Mortgagor under
the terms of the related Mortgage Note (without regard to the related Buydown Agreement as if the
Mortgage Loan were not subject to the terms of the Buydown Agreement). With respect to each Buydown
Mortgage Loan, the Company will distribute to the Purchaser on each Remittance Date an amount of
Buydown Funds equal to the amount that, when added to the amount required to be paid on such date
by the related



55









 







Mortgagor, pursuant to and in accordance with the related Buydown Agreement, equals the full
Monthly Payment that would otherwise be required to be paid on such Mortgage Loan by the related
Mortgagor under the terms of the related Mortgage Note (as if the Mortgage Loan were not a Buydown
Mortgage Loan and without regard to the related Buydown Agreement).



     If the Mortgagor on a Buydown Mortgage Loan defaults on such Mortgage Loan during the Buydown
Period and the Mortgaged Property securing such Buydown Mortgage Loan is sold in the liquidation
thereof (either by the Company or the insurer under any related Primary Insurance Policy) the
Company shall, on the Remittance Date following the date upon which Liquidation Proceeds or REO
Disposition proceeds are received with respect to any such Buydown Mortgage Loan, distribute to the
Purchaser all remaining Buydown Funds for such Mortgage Loan then remaining in the Escrow Account.
Pursuant to the terms of each Buydown Agreement, any amounts distributed to the Purchaser in
accordance with the preceding sentence will be applied to reduce the outstanding principal balance
of the related Buydown Mortgage Loan. If a Mortgagor on a Buydown Mortgage Loan prepays such
Mortgage Loan in its entirety during the related Buydown Period, the Company shall be required to
withdraw from the Escrow Account any Buydown Funds remaining in the Escrow Account with respect to
such Buydown Mortgage Loan in accordance with the related Buydown Agreement. If a principal
prepayment by a Mortgagor on a Buydown Mortgage Loan during the related Buydown Period, together
with any Buydown Funds then remaining in the Escrow Account related to such Buydown Mortgage Loan,
would result in a principal prepayment of the entire unpaid principal balance of the Buydown
Mortgage Loan, the Company shall distribute to the Purchaser on the Remittance Date occurring in
the month immediately succeeding the month in which such Principal Prepayment is received, all
Buydown Funds related to such Mortgage Loan so remaining in the Escrow Account, together with any
amounts required to be deposited into the Custodial Account.



Section 4.21 Notification of Adjustments.




     With respect to each Adjustable Rate Mortgage Loan, the Company shall adjust the Mortgage
Interest Rate on the related Adjustment Date in compliance with the requirements of applicable law
and the related Mortgage and Mortgage Note. The Company shall execute and deliver any and all
necessary notices required under applicable law and the terms of the related Mortgage Note and
Mortgage regarding the Mortgage Interest Rate adjustments. Upon the discovery by the Company or
the receipt of notice from the Purchaser that the Company has failed to adjust a Mortgage Interest
Rate in accordance with the terms of the related Mortgage Note, the Company shall immediately
deposit in the Custodial Account from its own funds the amount of any interest loss or deferral
caused the Purchaser thereby.



Section 4.22 Confidentiality/Protection of Customer Information.




     The Company shall keep confidential and shall not divulge to any party, without the
Purchaser’s prior written consent, the price paid by the Purchaser for the Mortgage Loans, except
to the extent that it is reasonable and necessary for the Company to do so in working with legal
counsel, auditors, taxing authorities or other governmental agencies. Each party agrees that it
shall comply with all applicable laws and regulations regarding the privacy or security of Customer
Information and shall maintain appropriate administrative, technical and physical



56









 







safeguards to protect the security, confidentiality and integrity of Customer Information,
including maintaining security measures designed to meet the objectives of the Interagency
Guidelines Establishing Standards for Safeguarding Customer Information, 66 Fed. Reg. 8616 (the
“Interagency Guidelines”). For purposes of this Section, the term “Customer Information” shall have
the meaning assigned to it in the Interagency Guidelines.



Section 4.23 Fair Credit Reporting Act




     The Company, in its capacity as servicer for each Mortgage Loan, agrees to fully furnish, in
accordance with the Fair Credit Reporting Act and its implementing regulations, accurate and
complete information (e.g., favorable and unfavorable) on its borrower credit files to Equifax,
Experian and Trans Union Credit Information Company (three of the credit repositories), on a
monthly basis.



Section 4.24 Establishment of and Deposits to Subsidy Account.




     The Company shall segregate and hold all Subsidy Funds collected and received pursuant to the
Subsidy Loans separate and apart from any of its own funds and general assets and shall establish
and maintain one or more Subsidy Accounts, in the form of time deposit or demand accounts, titled
“Wells Fargo Bank, N.A., in trust for the Purchaser, its successors or assigns, and/or subsequent
purchasers of Residential Mortgage Loans, and various Mortgagors.” The Subsidy Account shall be an
eligible deposit account established with an eligible institution.



     The Company shall, from time to time, withdraw funds from the Subsidy Account for the
following purposes:




     (i) to deposit in the Custodial Account in the amounts and in the manner provided for
in Section 4.04(xi);




     (ii) to transfer funds to another eligible institution in accordance with Section 4.09
hereof;




     (iii) to withdraw funds deposited in error; and




     (iv) to clear and terminate the Subsidy Account upon the termination of this Agreement.



     Notwithstanding anything to the contrary elsewhere in this Agreement, the Company may employ
the Escrow Account as the Subsidy Account to the extent that the Company can separately identify
any Subsidy Funds deposited therein.



57









 





Section 4.25 Letter of Credit Compliance.




     Notwithstanding any other provision of this Agreement, the Company shall comply with all the
requirements of any Letter of Credit so as to assure the full benefit of such Letter of Credit to
the Purchaser.



Section 4.26 Letter of Credit Draws.




     The Company shall take all steps necessary to make draws under any Letter of Credit in
accordance with the provisions thereof and shall draw on each Letter of Credit all amounts payable
thereunder within the time frame required by the Letter of Credit or such shorter time within which
the Company can effect such draw (not to exceed thirty (30) calendar days) of (i) the date the
related Pledged Asset Mortgage Loan becomes ninety (90) days or more delinquent and (ii) the
receipt of notice of non-renewal from the Pledge Holder at any time prior to the date that all
amounts owed under the related Pledged Asset Mortgage Loan are less than or equal to 80% of the
Appraised Value of the related Mortgaged Property. The Company shall notify the Purchaser promptly
in writing upon receipt of notice from the Pledge Holder of non-renewal of any Letter of Credit.
Upon receipt of any amounts as a result of a draw on a Letter of Credit because of the non-renewal
of such Letter of Credit or as a result of the Pledged Asset Mortgage Loan continuing in default
for ninety (90) or more days, the Company shall deposit such amounts in the Custodial Account and
such amount shall be treated as a payment of principal.



Section 4.27 Assignment of the Letter of Credit.




     Notwithstanding anything to the contrary in this Agreement (including, without limitation, the
termination or transfer of the servicing rights and/or obligations of the Company pursuant to
Articles X and XI hereof), the Company, as beneficiary under any Non-Assigned Letters of Credit,
shall transfer and assign, at no cost to the Purchaser, each Non-Assigned Letter of Credit to the
Purchaser in accordance with the provisions thereof within ten (10) days of such termination or
transfer. In addition, the Company shall forward within one (1) Business Day of receipt any notice
received of non-renewal of any Letter of Credit. Any funds received by the Company from draws on
the Non-Assigned Letters of Credit after the Company is no longer the servicer hereunder shall be
remitted by the Company to the successor servicer for deposit into the Custodial Account.



     Within thirty (30) days of the related Closing Date, the Company, as beneficiary under any
Letter of Credit, shall assign each Letter of Credit in blank and then deliver each such Letter of
Credit to the Custodian.



Section 4.28 Pledge Holder Defaults.




     Upon a default under the Letter of Credit by the Pledge Holder, the Company shall take
possession of the assets securing the Letter of Credit and shall deposit such assets or the
proceeds thereof in the Custodial Account and apply them as a prepayment of the related Pledged
Asset Mortgage Loan. If such default described in the prior sentence occurs at any time



58









 







that the Company is no longer the servicer of the related Pledged Asset Mortgage Loan, the Company
shall, upon knowledge of such default or notice from the successor servicer of such default with
respect to any Non-Assigned Letter of Credit forward such proceeds to the successor servicer for
deposit into the Custodial Account.



Section 4.29 Use of Subservicers and Subcontractors.



     The Company shall not hire or otherwise utilize the services of any Subservicer to fulfill any
of the obligations of the Company under this Agreement or any Reconstitution Agreement unless the
Company complies with the provisions of paragraph (a) of this Section 4.29. The Company shall not
hire or otherwise utilize the services of any Subcontractor, and shall not permit any Subservicer
to hire or otherwise utilize the services of any Subcontractor, to fulfill any of the obligations
of the Company under this Agreement or any Reconstitution Agreement unless the Company complies
with the provisions of paragraph (b) of this Section 4.29.




(a) It shall not be necessary for the Company to seek the consent of the Purchaser or any
Depositor to the utilization of any Subservicer. The Company shall cause any Subservicer
used by the Company (or by any Subservicer) for the benefit of the Purchaser and any
Depositor to comply with the provisions of this Section 4.29 and with Sections 6.04, 6.06,
9.01(d)(iii), 9.01(d)(v), 9.01(d)(vii), 9.01(d)(viii) and 9.01(e) of this Agreement to the
same extent as if such Subservicer were the Company, and to provide the information
required with respect to such Subservicer under Section 9.01(d)(iv) of this Agreement. The
Company shall be responsible for obtaining from each Subservicer and delivering to the
Purchaser and any Depositor any servicer compliance statement required to be delivered by
such Subservicer under Section 6.04 and any assessment of compliance and attestation
required to be delivered by such Subservicer under Section 6.06 and any certification
required to be delivered to the Person that will be responsible for signing the Sarbanes
Certification under Section 6.06 as and when required to be delivered.




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



     As a condition to the utilization of any Subcontractor determined to be “participating in the
servicing function” within the meaning of Item 1122 of Regulation AB, the Company shall cause any
such Subcontractor used by the Company (or by any Subservicer) for the benefit of the Purchaser and
any Depositor to comply with the provisions of Sections 6.06 and 9.01(e) of this Agreement to the
same extent as if such Subcontractor were the Company. The Company shall



59









 







be responsible for obtaining from each Subcontractor and delivering to the Purchaser and any
Depositor any assessment of compliance and attestation and other certifications required to be
delivered by such Subcontractor under Section 6.06, in each case as and when required to be
delivered.



ARTICLE V




PAYMENTS TO PURCHASER




Section 5.01 Remittances.




     On each Remittance Date the Company shall remit by wire transfer of immediately available
funds to the Purchaser (a) all amounts deposited in the Custodial Account as of the close of
business on the Determination Date (net of charges against or withdrawals from the Custodial
Account pursuant to Section 4.05), plus (b) all amounts, if any, which the Company is obligated to
distribute pursuant to Section 5.03, minus (c) any amounts attributable to Principal Prepayments
received after the applicable Principal Prepayment Period which amounts shall be remitted on the
following Remittance Date, together with any additional interest required to be deposited in the
Custodial Account in connection with such Principal Prepayment in accordance with Section
4.04(viii); minus (d) any amounts attributable to Monthly Payments collected but due on a Due Date
or Dates subsequent to the first day of the month of the Remittance Date, and minus (e) any amounts
attributable to Buydown Funds being held in the Custodial Account, which amounts shall be remitted
on the Remittance Date next succeeding the Due Period for such amounts.



     With respect to any remittance received by the Purchaser after the second Business Day
following the Business Day on which such payment was due, the Company shall pay to the Purchaser
interest on any such late payment at an annual rate equal to the Prime Rate, adjusted as of the
date of each change, plus three percentage points, but in no event greater than the maximum amount
permitted by applicable law. Such interest shall be deposited in the Custodial Account by the
Company on the date such late payment is made and shall cover the period commencing with the day
following such second Business Day and ending with the Business Day on which such payment is made,
both inclusive. Such interest shall be remitted along with the distribution payable on the next
succeeding Remittance Date. The payment by the Company of any such interest shall not be deemed an
extension of time for payment or a waiver of any Event of Default by the Company.



Section 5.02 Statements to Purchaser.




     Not later than the Remittance Date, the Company shall furnish to the Purchaser in either
written or electronic format, a delinquency report and a monthly remittance advice, each in a form
mutually acceptable to the Company and the Purchaser, as to the remittance period ending on the
last day of the preceding month.



60









 





Section 5.03 Monthly Advances by Company.




     On the Business Day immediately preceding each Remittance Date, the Company shall deposit in
the Custodial Account from its own funds or from amounts held for future distribution an amount
equal to all Monthly Payments (with interest adjusted to the Mortgage Loan Remittance Rate) which
were due on the Mortgage Loans during the applicable Due Period and which were delinquent at the
close of business on the immediately preceding Determination Date or which were deferred pursuant
to Section 4.01. Any amounts held for future distribution and so used shall be replaced by the
Company by deposit in the Custodial Account on or before any future Remittance Date if funds in the
Custodial Account on such Remittance Date shall be less than payments to the Purchaser required to
be made on such Remittance Date. The Company’s obligation to make such Monthly Advances as to any
Mortgage Loan will continue through the last Monthly Payment due prior to the payment in full of
the Mortgage Loan, or through the last Remittance Date prior to the Remittance Date for the
distribution of all Liquidation Proceeds and other payments or recoveries (including REO
Disposition Proceeds, Insurance Proceeds and Condemnation
Proceeds) with respect to the Mortgage Loan; provided, however, that such obligation shall cease if
the Company determines, in its sole reasonable opinion, that advances with respect to such Mortgage
Loan are non-recoverable by the Company from Liquidation Proceeds, REO Disposition Proceeds,
Insurance Proceeds, Condemnation Proceeds, or otherwise with respect to a particular Mortgage Loan.
In the event that the Company determines that any such advances are non-recoverable, the Company
shall provide the Purchaser with a certificate signed by two officers of the Company evidencing
such determination. The Company shall not have an obligation to make such Monthly Advances as to
any Mortgage Loan with respect to shortfalls relating to the Servicemembers Civil Relief Act or
similar state and local laws.



ARTICLE VI




GENERAL SERVICING PROCEDURES




Section 6.01 Transfers of Mortgaged Property.




     The Company shall use its best efforts to enforce any “due-on-sale” provision contained in any
Mortgage or Mortgage Note and to deny assumption by the Person to whom the Mortgaged Property has
been or is about to be sold whether by absolute conveyance or by contract of sale, and whether or
not the Mortgagor remains liable on the Mortgage and the Mortgage Note. When the Mortgaged
Property has been conveyed by the Mortgagor, the Company shall, to the extent it has knowledge of
such conveyance, exercise its rights to accelerate the maturity of such Mortgage Loan under the
“due-on-sale” clause applicable thereto, provided, however, that the Company shall not exercise
such rights if prohibited by law from doing so or if the exercise of such rights would impair or
threaten to impair any recovery under the related PMI Policy, if any.



     If the Company reasonably believes it is unable under applicable law to enforce such
“due-on-sale” clause, the Company shall enter into (i) an assumption and modification agreement
with the Person to whom such property has been conveyed, pursuant to which such Person becomes
liable under the Mortgage Note and the original Mortgagor remains liable thereon or



61









 




(ii) in the event the Company is unable under applicable law to require that the original Mortgagor
remain liable under the Mortgage Note and the Company has the prior consent of the primary mortgage
guaranty insurer, a substitution of liability agreement with the purchaser of the Mortgaged
Property pursuant to which the original Mortgagor is released from liability and the purchaser of
the Mortgaged Property is substituted as Mortgagor and becomes liable under the Mortgage Note. If
an assumption fee is collected by the Company for entering into an assumption agreement the fee
will be retained by the Company as additional servicing compensation. In connection with any such
assumption, neither the Mortgage Interest Rate borne by the related Mortgage Note, the term of the
Mortgage Loan, the outstanding principal amount of the Mortgage Loan nor any other material terms
shall be changed without Purchaser’s consent.




     To the extent that any Mortgage Loan is assumable, the Company shall inquire diligently into
the credit worthiness of the proposed transferee, and shall use the underwriting criteria for
approving the credit of the proposed transferee which are used with respect to underwriting
mortgage loans of the same type as the Mortgage Loan. If the credit worthiness of the proposed
transferee does not meet such underwriting criteria, the Company diligently shall, to the extent
permitted by the Mortgage or the Mortgage Note and by applicable law, accelerate the maturity of
the Mortgage Loan.



Section 6.02 Satisfaction of Mortgages and Release of Retained Mortgage Files.




     Upon the payment in full of any Mortgage Loan, or the receipt by the Company of a notification
that payment in full will be escrowed in a manner customary for such purposes, the Company shall
notify the Purchaser in the monthly remittance advice as provided in Section 5.02, and may request
the release of any Mortgage Loan Documents.



     If the Company satisfies or releases the lien of the Mortgage without first having obtained
payment in full of the indebtedness secured by the Mortgage (other than as a result of a
modification of the Mortgage pursuant to the terms of this Agreement or liquidation of the
Mortgaged Property pursuant to the terms of this Agreement) or should the Company otherwise
prejudice any rights the Purchaser may have under the mortgage instruments, upon written demand of
the Purchaser, the Company shall repurchase the related Mortgage Loan at the Repurchase Price by
deposit thereof in the Custodial Account within two (2) Business Days of receipt of such demand by
the Purchaser. The Company shall maintain the Fidelity Bond and Errors and Omissions Insurance
Policy as provided for in Section 4.12 insuring the Company against any loss it may sustain with
respect to any Mortgage Loan not satisfied in accordance with the procedures set forth herein.



Section 6.03 Servicing Compensation.




     As compensation for its services hereunder, the Company shall be entitled to withdraw from the
Custodial Account the amount of its Servicing Fee. The Servicing Fee shall be payable monthly and
shall be computed on the basis of the unpaid principal balance and for the period respecting which
any related interest payment on a Mortgage Loan is received. The obligation of the Purchaser to pay
the Servicing Fee is limited to, and payable solely from, the interest



62









 







portion (including recoveries with respect to interest from Liquidation Proceeds, to the extent
permitted by Section 4.05) of such Monthly Payments.



     Additional servicing compensation in the form of assumption fees, to the extent provided in
Section 6.01, and late payment charges shall be retained by the Company to the extent not required
to be deposited in the Custodial Account. The Company shall be required to pay all expenses
incurred by it in connection with its servicing activities hereunder and shall not be entitled to
reimbursement thereof except as specifically provided for herein.



Section 6.04 Annual Statements as to Compliance.




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



Section 6.05 [Reserved]




Section 6.06 Report on Assessment of Compliance and Attestation.




     On or before March 1 of each calendar year, the Company shall:




	 	(i)	 	deliver to the Purchaser and any Depositor a report (in form and substance reasonably
satisfactory to the Purchaser and such Depositor) regarding the Company’s assessment of compliance
with the Servicing Criteria during the immediately preceding calendar year, as required under Rules
13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such report shall be
addressed to the Purchaser and such Depositor and signed by an authorized officer of the Company
and shall address each of the “Applicable Servicing Criteria” specified on Exhibit F hereto;
	 
	 	(ii)	 	deliver to the Purchaser and any Depositor a report of a registered public accounting firm
reasonably acceptable to the Purchaser and such Depositor that attests to, and reports on, the
assessment of compliance made by the Company and delivered pursuant to the preceding paragraph.
Such attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under
the Securities Act and the Exchange Act;





63









 






	 	(iii)	 	cause each Subservicer and each Subcontractor, determined by the Company pursuant to Section
4.29(b) to be “participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, to deliver to the Purchaser and such Depositor an assessment of compliance and
accountants’ attestation as and when provided in paragraphs (i) and (ii) of this Section 6.06; and
	 
	 	(iv)	 	if requested by the Purchaser and any Depositor not later than February 1 of the calendar year
in which such certification is to be delivered, deliver to the Purchaser, any Depositor and any
other Person that will be responsible for signing the certification (a “Sarbanes Certification”)
required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act (pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002) on behalf of an asset-backed issuer with respect to a Securitization
Transaction a certification in the form attached hereto as Exhibit G.





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



     Each assessment of compliance provided by a Subservicer pursuant to Section 6.06(i) shall
address each of the Servicing Criteria specified on Exhibit F hereto or, in the case of a
Subservicer subsequently appointed as such, on or prior to the date of such appointment. An
assessment of compliance provided by a Subcontractor pursuant to Section 6.06(iii) need not address
any elements of the Servicing Criteria other than those specified by the Company pursuant to
Section 4.29.



Section 6.07 Remedies.




     (i) Any failure by the Company, any Subservicer, any Subcontractor or any Third-Party
Originator to deliver any information, report, certification, accountants’ letter or other material
when and as required under Article IX, Section 4.29, Section 6.04 or Section 6.06, or any breach by
the Company of a representation or warranty set forth in Section 9.01(d)(vi)(A), or in a writing
furnished pursuant to Section 9.01(d)(vi)(B) and made as of a date prior to the closing date of the
related Securitization Transaction, to the extent that such breach is not cured by such closing
date, or any breach by the Company of a representation or warranty in a writing furnished pursuant
to Section 9.01(d)(vi)(B) to the extent made as of a date subsequent to such closing date, shall,
except as provided in sub-clause (ii) of this Section, immediately and automatically, without
notice or grace period, constitute an Event of Default with respect to the Company under this
Agreement and any applicable Reconstitution Agreement, and shall entitle the Purchaser or any
Depositor, as applicable, in its sole discretion to terminate the rights and obligations of the
Company as servicer under this Agreement and/or any applicable Reconstitution Agreement without
payment (notwithstanding anything in this Agreement or any applicable Reconstitution Agreement to
the contrary) of any compensation to the Company; provided, that to the extent that any provision
of this Agreement and/or any applicable



64









 




Reconstitution Agreement expressly provides for the survival of certain rights or obligations
following termination of the Company as servicer, such provision shall be given effect.




     (ii) Any failure by the Company, any Subservicer or any Subcontractor to deliver any
information, report, certification or accountants’ letter when and as required under Section 6.04
or Section 6.06, including (except as provided below) any failure by the Company to identify any
Subcontractor “participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, which continues unremedied for ten (10) calendar days after the date on which such
information, report, certification or accountants’ letter was required to be delivered shall
constitute an Event of Default with respect to the Company under this Agreement and any applicable
Reconstitution Agreement, and shall entitle the Purchaser or any Depositor, as applicable, in its
sole discretion to terminate the rights and obligations of the Company under this Agreement and/or
any applicable Reconstitution Agreement without payment (notwithstanding anything in this Agreement
to the contrary) of any compensation to the Company; provided that to the extent that any provision
of this Agreement and/or any applicable Reconstitution Agreement expressly provides for the
survival of certain rights or obligations following termination of the Company as servicer, such
provision shall be given effect.



     Neither the Purchaser nor any Depositor shall be entitled to terminate the rights and
obligations of the Company pursuant to this Section 6.07(ii) if a failure of the Company to
identify a Subcontractor “participating in the servicing function” within the meaning of Item 1122
of Regulation AB was attributable solely to the role or function of such Subcontractor with respect
to mortgage loans other than the Mortgage Loans.



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



Section 6.08 Right to Examine Company Records.




     The Purchaser, or its designee, shall have the right to examine and audit any and all of the
books, records, or other information of the Company, whether held by the Company or by another on
its behalf, with respect to or concerning this Agreement or the Mortgage Loans, during business
hours or at such other times as may be reasonable under applicable circumstances, upon reasonable
advance notice. The Purchaser shall pay its own expenses associated with such examination.



Section 6.09 Compliance with REMIC Provisions.




     If a REMIC election has been made with respect to the arrangement under which the Mortgage
Loans and REO Property are held, the Company shall not take any action, cause the



65









 




REMIC to take any action or fail to take any action that, under the REMIC Provisions, if taken or
not taken, as the case may be, could (i) endanger the status of the REMIC as a REMIC or (ii) result
in the imposition of a tax upon the REMIC (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 Company has received an Opinion of
Counsel (at the expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such REMIC status or result in the imposition of any such
tax.




ARTICLE VII




COMPANY TO COOPERATE




Section 7.01 Provision of Information.




     During the term of this Agreement, the Company shall furnish to the Purchaser such periodic,
special, or other reports or information, and copies or originals of any documents contained in the
Servicing File for each Mortgage Loan provided for herein. All other special reports or information
not provided for herein as shall be necessary, reasonable, or appropriate with respect to the
Purchaser or any regulatory agency will be provided at the Purchaser’s expense. All such reports,
documents or information shall be provided by and in accordance with all reasonable instructions
and directions which the Purchaser may give.



     The Company shall execute and deliver all such instruments and take all such action as the
Purchaser may reasonably request from time to time, in order to effectuate the purposes and to
carry out the terms of this Agreement.



Section 7.02 Financial Statements; Servicing Facility.




     In connection with marketing the Mortgage Loans, the Purchaser may make available to a
prospective purchaser a Consolidated Statement of Operations of the Company for the most recently
completed two (2) fiscal years for which such a statement is available, as well as a Consolidated
Statement of Condition at the end of the last two (2) fiscal years covered by such Consolidated
Statement of Operations. The Company, upon request, also shall make available any comparable
interim statements to the extent any such statements have been prepared by or on behalf of the
Company (and are available upon request to members or stockholders of the Company or to the public
at large).



     The Company also shall make available to Purchaser or prospective purchasers a knowledgeable
financial or accounting officer for the purpose of answering questions respecting recent
developments affecting the Company or the financial statements of the Company, and to permit any
prospective purchaser
to inspect the Company’s servicing facilities for the purpose of satisfying such prospective
purchaser that the Company has the ability to service the Mortgage Loans as provided in this
Agreement.



66









 





ARTICLE VIII




THE COMPANY




Section 8.01 Indemnification; Third Party Claims.




     The Company shall indemnify the Purchaser and hold it harmless against any and all claims,
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and any other costs, fees and expenses that the Purchaser may sustain in any way
related to the failure of the Company to perform its duties and service the Mortgage Loans in
strict compliance with the terms of this Agreement. The Company immediately shall notify the
Purchaser if a claim is made by a third party with respect to this Agreement or the Mortgage Loans,
assume (with the prior written consent of the Purchaser) the defense of any such claim and pay all
expenses in connection therewith, including counsel fees, and promptly pay, discharge and satisfy
any judgment or decree which may be entered against it or the Purchaser in respect of such claim.
The Company shall follow any written instructions received from the Purchaser in connection with
such claim. The Purchaser promptly shall reimburse the Company for all amounts advanced by it
pursuant to the preceding sentence except when the claim is in any way related to the Company’s
indemnification pursuant to Section 3.03, or the failure of the Company to service and administer
the Mortgage Loans in strict compliance with the terms of this Agreement.



Section 8.02 Merger or Consolidation of the Company.




     The Company shall keep in full effect its existence, rights and franchises, and shall obtain
and preserve its qualification to do business in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of this Agreement or any of the
Mortgage Loans and to perform its duties under this Agreement.



     Any Person into which the Company may be merged or consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Company shall be a party, or any Person
succeeding to the business of the Company, shall be the successor of the Company hereunder, without
the execution or filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding, provided, however, that the successor or surviving
Person shall be an institution which is a Fannie Mae/Freddie Mac-approved seller/servicer in good
standing. Furthermore, in the event the Company transfers or otherwise disposes of all or
substantially all of its assets to an affiliate of the Company, such affiliate shall satisfy the
condition above, and shall also be fully liable to the Purchaser for all of the Company’s
obligations and liabilities hereunder.



Section 8.03 Limitation on Liability of Company and Others.




     Neither the Company nor any of the directors, officers, employees or agents of the Company
shall be under any liability to the Purchaser for any action taken or for refraining from the
taking of any action in good faith pursuant to this Agreement, or for errors in judgment, provided,
however, that this provision shall not protect the Company or any such Person against



67









 




any breach of warranties or representations made herein, or failure to perform its obligations in
strict compliance with any standard of care set forth in this Agreement or any other liability
which would otherwise be imposed under this Agreement. The Company and any director, officer,
employee or agent of the Company may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising hereunder. The Company
shall not be under any obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Mortgage Loans in accordance with this Agreement and which
in its opinion may involve it in any expense or liability, provided, however, that the Company may,
with the consent of the Purchaser,
undertake any such action which it may deem necessary or desirable in respect to this Agreement and
the rights and duties of the parties hereto. In such event, the Company shall be entitled to
reimbursement from the Purchaser of the reasonable legal expenses and costs of such action.




Section 8.04 Limitation on Resignation and Assignment by Company.




     The Purchaser has entered into this Agreement with the Company and subsequent purchasers will
purchase the Mortgage Loans in reliance upon the independent status of the Company, and the
representations as to the adequacy of its servicing facilities, personnel, records and procedures,
its integrity, reputation and financial standing, and the continuance thereof. Therefore, the
Company shall neither assign this Agreement or the servicing rights hereunder or delegate its
rights or duties hereunder (other than pursuant to Section 4.01) or any portion hereof or sell or
otherwise dispose of all of its property or assets without the prior written consent of the
Purchaser, which consent shall not be unreasonably withheld.



     The Company shall not resign from the obligations and duties hereby imposed on it except by
mutual consent of the Company and the Purchaser or upon the determination that its duties hereunder
are no longer permissible under applicable law and such incapacity cannot be cured by the Company.
Any such determination permitting the resignation of the Company shall be evidenced by an Opinion
of Counsel to such effect delivered to the Purchaser which Opinion of Counsel shall be in form and
substance acceptable to the Purchaser. No such resignation shall become effective until a successor
shall have assumed the Company’s responsibilities and obligations hereunder in the manner provided
in Section 12.01.



     Without in any way limiting the generality of this Section 8.04, in the event that the Company
either shall assign this Agreement or the servicing responsibilities hereunder or delegate its
rights or duties hereunder (other than pursuant to Section 4.01) or any portion hereof or sell or
otherwise dispose of all or substantially all of its property or assets, without the prior written
consent of the Purchaser, then the Purchaser shall have the right to terminate this Agreement upon
notice given as set forth in Section 10.01, without any payment of any penalty or damages and
without any liability whatsoever to the Purchaser or any third party.



68









 





ARTICLE IX




AGENCY TRANSFERS, SECURITIZATION TRANSACTIONS AND WHOLE LOAN



TRANSFERS




Section 9.01 Agency Transfers, Securitization Transactions and Whole Loan Transfers




     The Purchaser and the Company agree that with respect to some or all of the Mortgage Loans,
the Purchaser, at its sole option, may effect Whole Loan Transfers, Agency Transfers or
Securitization Transactions, retaining the Company as the servicer thereof or subservicer if a
master servicer is employed, or as applicable the “seller/servicer.” On the Reconstitution Date,
the Mortgage Loans transferred may cease to be covered by this Agreement; provided, however, that,
in the event that any Mortgage Loan transferred pursuant to this Section 9.01 is rejected by the
transferee, the Company shall continue to service such rejected Mortgage Loan on behalf of the
Purchaser in accordance with the terms and provisions of this Agreement.



     The Company shall cooperate with the Purchaser in connection with each Whole Loan Transfer,
Agency Transfer or Securitization Transaction in accordance with this Section 9.01. In connection
therewith:




	 	(a)	 	The Company shall make all representations and warranties made herein with respect to the
Mortgage Loans as of the Closing Date and all representations and warranties made herein with
respect to the Company itself as of the closing date of each Whole Loan Transfer, Agency Transfer
or Securitization Transaction;
	 
	 	(b)	 	The Company shall negotiate in good faith and execute any (i) seller/servicer agreements
required to effectuate the foregoing provided such agreements create no greater obligation or cost
on the part of the Company than otherwise set forth in this Agreement or (ii) an assignment,
assumption and recognition agreement, in the form attached hereto as Exhibit H, or a pooling and
servicing agreement in form and substance reasonably acceptable to the Purchaser and the Company,
which shall not create any greater obligation upon the Company.
	 
	 	(c)	 	The Company shall execute any seller/servicer agreements required within a reasonable period of
time after receipt of such seller/servicer agreements which time shall be sufficient for the
Company and Company’s counsel to review such seller/servicer agreements. Under this Agreement, the
Company shall retain a Servicing Fee for each Mortgage Loan at the Servicing Fee Rate; and
	 
	 	(d)	 	In connection with any Securitization Transaction, the Company shall (1) within five (5)
Business Days following request by the Purchaser or any Depositor, provide to the Purchaser and
such Depositor (or, as applicable, cause each Third-Party Originator and each Subservicer to
provide), in writing and in form and substance reasonably satisfactory to the Purchaser and such
Depositor, the information and materials specified in paragraphs (i), (ii), (iii) and (vii) of this
subsection (d), and (2) as promptly as practicable following notice to or discovery by the Company,
provide to the Purchaser and any Depositor (in writing and in form and substance reasonably
satisfactory to the Purchaser and such Depositor) the information specified in paragraph (iv) of
this subsection (d).





69









 






(i) If so requested by the Purchaser or any Depositor, the Company shall provide such
information regarding (1) the Company, as originator of the Mortgage Loans (including as
an acquirer of Mortgage Loans from a Qualified Correspondent), or (2) each Third-Party
Originator, and (3) as applicable, each Subservicer, as is requested for the purpose of
compliance with Items 1103(a)(1), 1105, 1110, 1117 and 1119 of Regulation AB. Such
information shall include, at a minimum:




	 	(A)	 	the originator’s form of organization;
	 
	 	(B)	 	a description of the originator’s origination program and how long the originator has been
engaged in originating residential mortgage loans, which description shall include a discussion of
the originator’s experience in originating mortgage loans of a similar type as the Mortgage Loans;
information regarding the size and composition of the originator’s origination portfolio; and
information that may be material, in the good faith judgment of the Purchaser or any Depositor, to
an analysis of the performance of the Mortgage Loans, including the originators’ credit-granting or
underwriting criteria for mortgage loans of similar type(s) as the Mortgage Loans and such other
information as the Purchaser or any Depositor may reasonably request for the purpose of compliance
with Item 1110(b)(2) of Regulation AB;
	 
	 	(C)	 	a description of any material legal or governmental proceedings pending (or known to be
contemplated) against the Company, each Third-Party Originator and each Subservicer; and
	 
	 	(D)	 	a description of any affiliation or relationship (of a type described in Item 1119 of
Regulation AB) between the Company, each Third-Party Originator, each Subservicer and any of the
following parties to a Securitization Transaction, as such parties are identified to the Company by
the Purchaser or any Depositor in writing in advance of a Securitization Transaction:






	 	(1)	 	the sponsor;
	 
	 	(2)	 	the depositor;
	 
	 	(3)	 	the issuing entity;
	 
	 	(4)	 	any servicer;
	 
	 	(5)	 	any trustee;
	 
	 	(6)	 	any originator;
	 
	 	(7)	 	any significant obligor;
	 
	 	(8)	 	any enhancement or support provider; and
	 
	 	(9)	 	any other material transaction party.





70









 






	 	(ii)	 	If so requested by the Purchaser or any Depositor, the Company shall provide (or, as
applicable, cause each Third-Party Originator to provide) Static Pool Information with
respect to the mortgage loans (of a similar type as the Mortgage Loans, as reasonably
identified by the Purchaser as provided below) originated by (1) the Company, if the
Company is an originator of Mortgage Loans (including as an acquirer of Mortgage Loans
from a Qualified Correspondent), and/or (2) each Third-Party
Originator. Such Static Pool Information shall be prepared by the Company (or Third-Party
Originator) on the basis of its reasonable, good faith interpretation of the
requirements of Item 1105(a)(1)-(3) of Regulation AB. To the extent that there is
reasonably available to the Company (or Third-Party Originator) Static Pool
Information with respect to more than one mortgage loan type, the Purchaser or any
Depositor shall be entitled to specify whether some or all of such information
shall be provided pursuant to this paragraph. The content of such Static Pool
Information may be in the form customarily provided by the Company, and need not
be customized for the Purchaser or any Depositor. Such Static Pool Information for
each vintage origination year or prior securitized pool, as applicable, shall be
presented in increments no less frequently than quarterly over the life of the
mortgage loans included in the vintage origination year or prior securitized pool.
The most recent periodic increment must be as of a date no later than 135 days
prior to the date of the prospectus or other offering document in which the Static
Pool Information is to be included or incorporated by reference. The Static Pool
Information shall be provided in an electronic format that provides a permanent
record of the information provided, such as a portable document format (pdf) file,
or other such electronic format reasonably required by the Purchaser or the
Depositor, as applicable.
	 
	 	 	 	Promptly following notice or discovery of a material error in Static Pool
Information provided pursuant to the immediately preceding paragraph (including an
omission to include therein information required to be provided pursuant to such
paragraph), the Company shall provide corrected Static Pool Information to the
Purchaser or any Depositor, as applicable, in the same format in which Static Pool
Information was previously provided to such party by the Company.
	 
	 	 	 	If so requested by the Purchaser or any Depositor, the Company shall provide (or,
as applicable, cause each Third-Party Originator to provide), at the expense of
the requesting party (to the extent of any additional incremental expense
associated with delivery pursuant to this Agreement), such agreed-upon procedures
letters of certified public accountants reasonably acceptable to the Purchaser or
Depositor, as applicable, pertaining to Static Pool Information relating to prior
securitized pools for securitizations closed on or after January 1, 2006 or, in
the case of Static Pool Information with respect to the Company’s or Third-Party




71









 






	 	 	 	Originator’s originations or purchases, to calendar months commencing January 1,
2006, as the Purchaser or such Depositor shall reasonably request. Such letters
shall be addressed to and be for the benefit of such parties as the Purchaser or
such Depositor shall designate, which may include, by way of example, any sponsor,
any Depositor and any broker dealer acting as underwriter, placement agent or
initial purchaser with respect to a Securitization Transaction. Any such statement
or letter may take the form of a standard, generally applicable document
accompanied by a reliance letter authorizing reliance by the addressees designated
by the Purchaser or such Depositor.






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






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






	 	(1)	 	whether any prior securitizations of mortgage loans of a type similar
to the Mortgage Loans involving the Servicer have defaulted or experienced
an early amortization or other performance triggering event because of
servicing during the three-year period immediately preceding the related
Securitization Transaction;
	 
	 	(2)	 	the extent of outsourcing the Servicer utilizes;
	 
	 	(3)	 	whether there has been previous disclosure of material noncompliance
with the applicable Servicing Criteria with respect to other
securitizations of residential mortgage




72









 






	 	 	 	loans involving the Servicer as a servicer during the three-year
period immediately preceding the related Securitization
Transaction;






	 	(4)	 	whether the Servicer has been terminated as servicer in a residential
mortgage loan securitization, either due to a servicing default or to
application of a servicing performance test or trigger; and
	 
	 	(5)	 	such other information as the Purchaser or any Depositor may
reasonably request for the purpose of compliance with Item 1108(b)(2) of
Regulation AB;






	 	(C)	 	a description of any material changes during the three-year period immediately
preceding the related Securitization Transaction to the Servicer’s policies or
procedures with respect to the servicing function it will perform under this
Agreement and any Reconstitution Agreements for mortgage loans of a type similar
to the Mortgage Loans;
	 
	 	(D)	 	information regarding the Servicer’s financial condition, to the extent that
there is a material risk that an adverse financial event or circumstance involving
the Servicer could have a material adverse effect on the performance by the
Company of its servicing obligations under this Agreement or any Reconstitution
Agreement;
	 
	 	(E)	 	information regarding advances made by the Servicer on the Mortgage Loans and
the Servicer’s overall servicing portfolio of residential mortgage loans for the
three-year period immediately preceding the related Securitization Transaction,
which may be limited to a statement by an authorized officer of the Servicer to
the effect that the Servicer has made all advances required to be made on
residential mortgage loans serviced by it during such period, or, if such
statement would not be accurate, information regarding the percentage and type of
advances not made as required, and the
reasons for such failure to advance;
	 
	 	(F)	 	a description of the Servicer’s processes and procedures designed to address
any special or unique factors involved in servicing loans of a similar type as the
Mortgage Loans;
	 
	 	(G)	 	a description of the Servicer’s processes for handling delinquencies, losses,
bankruptcies and recoveries, such as through liquidation of mortgaged properties,
sale of defaulted mortgage loans or workouts;





73









 






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






	 	(iv)	 	If so requested by the Purchaser or any Depositor for the purpose of satisfying the
reporting obligation under the Exchange Act with respect to any class of asset-backed
securities, the Company shall (or shall cause each Subservicer and Third-Party Originator
to) (1) notify the Purchaser and any Depositor in writing of (A) any material litigation
or governmental proceedings involving the Company, any Subservicer or any Third-Party
Originator and (B) any affiliations or relationships that develop following the closing
date of a Securitization Transaction between the Company, any Subservicer or any
Third-Party Originator and any of the parties specified in Section 9.01(d)(i)(D) (and any
other parties identified in writing by the requesting party) with respect to such
Securitization Transaction, and (2) provide to the Purchaser and any Depositor a
description of such proceedings, affiliations or relationships.
	 
	 	(v)	 	As a condition to the succession to the Company or any Subservicer as servicer or
Subservicer under this Agreement or any Reconstitution Agreement by any Person (i) into
which the Company or such Subservicer may be merged or consolidated, or (ii) which may be
appointed as a successor to the Company or any Subservicer, the Company shall provide to
the Purchaser and any Depositor, at least fifteen (15) calendar days prior to the
effective date of such succession or appointment, (x) written notice to the Purchaser and
any Depositor of such succession or appointment and (y) in writing and in form and
substance reasonably satisfactory to the Purchaser and such Depositor, all information
reasonably requested by the Purchaser or any Depositor in order to comply with its
reporting obligation under Item 6.02 of Form 8-K with respect to any class of asset-backed
securities.
	 
	 	(vi)	 	(A) The Company shall be deemed to represent to the Purchaser and to any Depositor,
as of the date on which information is first provided to the Purchaser or any Depositor
under this Section 9.01(d) that, except as disclosed in writing to the Purchaser or such
Depositor prior to such date: (1) the Company is not aware and has not received notice
that any default, early amortization or other performance triggering event has occurred as
to any other securitization due to any act or failure to act of the Company; (2) the
Company has not been terminated as servicer in a residential mortgage loan securitization,
either due to a servicing default or to application of a servicing performance test or
trigger; (3) no material noncompliance with the applicable Servicing Criteria with respect
to other securitizations of residential mortgage loans involving the Company as





74









 






	 	 	 	servicer has been disclosed or reported by the Company; (4) no material changes to
the Company’s policies or procedures with respect to the servicing function it
will perform under this Agreement and any Reconstitution Agreement for mortgage
loans of a type similar to the Mortgage Loans have occurred during the three-year
period immediately
preceding the related Securitization Transaction; (5) there are no aspects of the
Company’s financial condition that could have a material adverse effect on the
performance by the Company of its servicing obligations under this Agreement or
any Reconstitution Agreement; (6) there are no material legal or governmental
proceedings pending (or known to be contemplated) against the Company, any
Subservicer or any Third-Party Originator; and (7) there are no affiliations,
relationships or transactions relating to the Company, any Subservicer or any
Third-Party Originator with respect to any Securitization Transaction and any
party thereto identified by the related Depositor of a type described in Item 1119
of Regulation AB.
	 
	 	 	 	(B) If so requested by the Purchaser or any Depositor on any date following the
date on which information is first provided to the Purchaser or any Depositor
under this Section 9.01(d), the Company shall, within five (5) Business Days
following such request, confirm in writing the accuracy of the representations and
warranties set forth in sub clause (A) above or, if any such representation and
warranty is not accurate as of the date of such request, provide reasonably
adequate disclosure of the pertinent facts, in writing, to the requesting party.
	 
	 	(vii)	 	In addition to such information as the Company, as servicer, is obligated to provide
pursuant to other provisions of this Agreement, if so requested by the Purchaser or any
Depositor, the Company shall provide such information regarding the performance or
servicing of the Mortgage Loans as is reasonably required to facilitate preparation of
distribution reports in accordance with Item 1121 of Regulation AB. Such information shall
be provided concurrently with the monthly reports otherwise required to be delivered by the
servicer under this Agreement, commencing with the first such report due not less than ten
(10) Business Days following such request.






	(e)	 	The Company shall indemnify the Purchaser, each affiliate of the Purchaser, and each of the
following parties participating in a Securitization Transaction: each sponsor and issuing entity;
each Person responsible for the preparation, execution or filing of any report required to be filed
with the Commission with respect to such Securitization Transaction, or for execution of a
certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the Exchange Act with respect to
such Securitization Transaction; each broker dealer acting as underwriter, placement agent or
initial purchaser, each Person who controls any of such parties or the Depositor (within the
meaning of Section 15 of the Securities Act and Section 20





75









 






of the Exchange Act); and the respective present and former directors, officers, employees
and agents of each of the foregoing and of the Depositor (each, an “Indemnified Party”),
and shall hold each of them harmless from and against any losses, damages, penalties,
fines, forfeitures, legal fees and expenses and related costs, judgments, and any other
costs, fees and expenses that any of them may sustain arising out of or based upon:




	 	(i)	 	(A) any untrue statement of a material fact contained or alleged to be contained in
any information, report, certification, accountants’ letter or other material provided in
written or electronic form under Sections 4.29, 6.04, 6.06, 9.01(d) and (e) by or on
behalf of the Company, or provided under Sections 4.29, 6.04, 6.06, 9.01(d) and (e) by or
on behalf of any Subservicer, Subcontractor or Third-Party Originator (collectively, the
“Company Information”), or (B) the omission or alleged omission to state in the Company
Information a material fact required to be stated in the Company Information or necessary
in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, by way of clarification, that clause (B) of this
paragraph shall be construed solely by reference to the Company Information and not to any
other information communicated in connection with a sale or purchase of securities,
without regard to whether the Company Information or any portion thereof is presented
together with or separately from such other information;
	 
	 	(ii)	 	any breach by the Company of its obligations under this Section 9.01(e), including
particularly any failure by the Company, any Subservicer, any Subcontractor or any
Third-Party Originator to deliver any information, report, certification, accountants’
letter or other material
when and as required under Sections 4.29, 6.04, 6.06 and 9.01(d), including any failure by
the Company to identify any Subcontractor “participating in the servicing function” within
the meaning of Item 1122 of Regulation AB; or
	 
	 	(iii)	 	any breach by the Company of a representation or warranty set forth in Section
9.01(d)(vi)(A) or in a writing furnished pursuant to Section 9.01(d)(vi)(B) and made as
of a date prior to the closing date of the related Securitization Transaction, to the
extent that such breach is not cured by such closing date, or any breach by the Company
of a representation or warranty in a writing furnished pursuant to Section 9.01(d)(vi)(B)
to the extent made as of a date subsequent to such closing date.






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




76









 












	 	 	 	In the case of any failure of performance described in sub-clause (ii) of this Section
9.01(e), the Company shall promptly reimburse the Purchaser, any Depositor, as applicable,
and each Person responsible for the preparation, execution or filing of any report
required to be filed with the Commission with respect to such Securitization Transaction,
or for execution of a certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the
Exchange Act with respect to such Securitization Transaction, for all costs reasonably
incurred by each such party in order to obtain the information, report, certification,
accountants’ letter or other material not delivered as required by the Company, any
Subservicer, any Subcontractor or any Third-Party Originator.
	 
	 	 	 	This indemnification shall survive the termination of this Agreement or the termination of
any party to this Agreement.
	 
	 	(f)	 	The Purchaser and a credit-worthy parent of the Purchaser, reasonably acceptable to the Company
shall indemnify the Company, each affiliate of the Company, each Person who controls any of such
parties or the Company (within the meaning of Section 15 of the Securities Act and Section 20 of
the Exchange Act) and the respective present and former directors, officers, employees and agents
of each of the foregoing and of the Company, and shall hold each of them harmless from and against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses and related costs,
judgments, and any other costs, fees and expenses that any of them may sustain arising out of or
based upon:






	 	(i)	 	any untrue statement of a material fact contained or alleged to be contained in any
offering materials related to a Securitization Transaction, including without limitation
the registration statement, prospectus, prospectus supplement, any private placement
memorandum, any free writing prospectuses, any ABS informational and computational
material, and any amendments or supplements to the foregoing (collectively, the
“Securitization Materials”) or
	 
	 	(ii)	 	the omission or alleged omission to state in the Securitization Materials a material
fact required to be stated in the Securitization Materials or necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not
misleading,






	 	 	 	but only to the extent that such untrue statement or alleged untrue statement or omission
or alleged omission is other than a statement or omission arising out of, resulting from,
or based upon the Company Information.
	 
	 	 	 	If the indemnification provided for herein is unavailable or insufficient to hold harmless
an Indemnified Party, then the Purchaser agrees that it shall contribute to the amount
paid or payable by such Indemnified Party as a result of any claims, losses, damages or
liabilities incurred by such Indemnified Party in such




77









 






	 	 	 	proportion as is appropriate to reflect the relative fault of such Indemnified Party on
the one hand and the Purchaser on the other.






	 	 	 	This indemnification shall survive the termination of this Agreement or the termination of
any party to this Agreement.
	 
	 	(g)	 	The Company shall at any time as required by any Rating Agency, and in accordance with Section
2.02, provide such additional documents from the related Retained Mortgage File to the Custodian.
	 
	 	(h)	 	In connection with an Agency Transfer, the Purchaser shall provide the Company with a list of
the Mortgage Loans, including the preliminary scheduled principal balance of each Mortgage Loan, to
be included in such Agency Transfer. Upon receipt of such Mortgage Loan list, the Company shall
provide the Purchaser with the seller/servicer number to be used by the Company to deliver such
Mortgage Loans to the related Agency. The Purchaser shall be responsible for providing accurate
information, as specified above, to the related Agency. If the Purchaser fails to provide accurate
information, the Purchaser shall reimburse the Company for any and all penalties assessed by such
related Agency and any reasonable expenses incurred as a result of such inaccurate information.





     The Purchaser and the Company acknowledge and agree that the purpose of Sections
4.29, 6.04, 6.06 and 9.01(d) is to facilitate compliance by the Purchaser and any
Depositor with the provisions of Regulation AB and related rules and regulations of the
Commission. Although Regulation AB is applicable by its terms only to offerings of
asset-backed securities that are registered under the Securities Act, the Company
acknowledges that investors in privately offered securities may require that the
Purchaser or any Depositor provide comparable disclosure in unregistered offerings.
References in this Agreement to compliance with Regulation AB include provisions of
comparable disclosure in private offerings.



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



78









 







Mortgage Loans, or the servicing of the Mortgage Loans, reasonably believed by the Purchaser or any
Depositor to be necessary in order to effect such compliance.



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



     In the event the Purchaser has elected to have the Company hold record title to the Mortgages,
prior to the Reconstitution Date the Company shall prepare an Assignment of Mortgage in blank or to
the trustee from the Company acceptable to the trustee for each Mortgage Loan that is part of the
Whole Loan Transfers, Agency Transfers or Securitization Transactions. The Purchaser shall pay all
preparation and recording costs associated therewith, if such Assignments of Mortgage have been
previously prepared and recorded in the name of the Purchaser or its designee. The Company shall
execute each Assignment of Mortgage, track such Assignments of Mortgage to ensure they have been
recorded and deliver them as required by the trustee upon the Company’s receipt thereof.
Additionally, the Company shall prepare and execute, at the direction of the Purchaser, any note
endorsements in connection with any and all seller/servicer agreements.



     All Mortgage Loans (i) not sold or transferred pursuant to Whole Loan Transfers, Agency
Transfers or Securitization Transactions or (ii) that are subject to a Securitization Transaction
for which the related trust is terminated for any reason, shall remain subject to this Agreement
and shall continue to be serviced in accordance with the terms of this Agreement and with respect
thereto this Agreement shall remain in full force and effect.



ARTICLE X




DEFAULT




Section 10.01 Events of Default.




     Each of the following shall constitute an Event of Default on the part of the Company:




	 	(i)	 	any failure by the Company to remit to the Purchaser any payment required to be made under the
terms of this Agreement which continues unremedied for a period of five (5) Business Days after the
date upon which written notice of such failure, requiring the same to be remedied, shall have been
given to the Company by the Purchaser; or
	 
	 	(ii)	 	failure by the Company duly to observe or perform in any material respect any other of the
covenants or agreements on the part of the Company set forth in this Agreement or in the Custodial
Agreement which continues unremedied for a period of ninety (90) days after the date on which
written notice of such failure,




79









 






	 	 	 	requiring the same to be remedied, shall have been given to the Company by the Purchaser
or by the Custodian; or






	 	(iii)	 	failure by the Company to maintain its license to do business in any jurisdiction where the
Mortgaged Property is located if such license is required; or
	 
	 	(iv)	 	a decree or order of a court or agency or supervisory authority having jurisdiction for the
appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt,
including bankruptcy, marshaling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs,
shall have been entered against the Company and such decree or order shall have remained in force
undischarged or unstayed for a period of sixty (60) days; or
	 
	 	(v)	 	the Company shall consent to the appointment of a conservator or receiver or liquidator in any
insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or
relating to the Company or of or relating to all or substantially all of its property; or
	 
	 	(vi)	 	the Company shall admit in writing its inability to pay its debts generally as they become
due, file a petition to take advantage of any applicable insolvency, bankruptcy or reorganization
statute, make an assignment for the benefit of its creditors, voluntarily suspend payment of its
obligations or cease its normal business operations for three (3) Business Days; or
	 
	 	(vii)	 	the Company ceases to meet the qualifications of a Fannie Mae/Freddie Mac servicer; or
	 
	 	(viii)	 	the Company attempts to assign its right to servicing compensation
hereunder or to assign this Agreement or the servicing responsibilities
hereunder or to delegate its duties hereunder or any portion thereof in
violation of Section 8.04; or
	 
	 	(ix)	 	an Event of Default as defined in Section 6.07.





     In each and every such case, so long as an Event of Default shall not have been
remedied, in addition to whatever rights the Purchaser may have at law or equity to
damages, including injunctive relief and specific performance, the Purchaser, by notice
in writing to the Company, may terminate all the rights and obligations of the Company
under this Agreement and in and to the Mortgage Loans and the proceeds thereof.



     Upon receipt by the Company of such written notice, all authority and power of the
Company under this Agreement, whether with respect to the Mortgage Loans or otherwise,
shall pass to and be vested in the successor appointed pursuant to Section 12.01. Upon
written request from any Purchaser, the Company shall prepare, execute and deliver to
the successor entity designated by the Purchaser any and all documents and other
instruments, place in such successor’s possession all Retained Mortgage Files, and do
or cause to be done all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, including but



80









 




not limited to the transfer and endorsement or assignment of the Mortgage Loans and
related documents, at the Company’s sole expense. The Company shall cooperate with the
Purchaser and such successor in effecting the termination of the Company’s
responsibilities and rights hereunder, including without limitation, the transfer to
such successor for administration by it of all cash amounts which shall at the time be
credited by the Company to the Custodial Account, Subsidy Account or Escrow Account or
thereafter received with respect to the Mortgage Loans.




Section 10.02 Waiver of Defaults.




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



ARTICLE XI




TERMINATION




Section 11.01 Termination.




     This Agreement shall terminate upon: (i) the later of the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan or the
disposition of any REO Property with respect to the last Mortgage Loan and the
remittance of all funds due hereunder; (ii) mutual consent of the Company and the
Purchaser in writing; or (iii) as provided in Section 10.01 of this Agreement.



Section 11.02 Termination Without Cause.




     The Purchaser may terminate, at its sole option, any rights the Company may have
hereunder, without cause as provided in this Section 11.02. Any such notice of
termination shall be in writing and delivered to the Company by registered mail as
provided in Section 12.05.



     The Company shall be entitled to receive, as such liquidated damages, upon the
transfer of the servicing rights, an amount equal to: (i) 2.75% of the aggregate
outstanding principal amount of the Mortgage Loans as of the termination date paid by
the Purchaser to the Company with respect to all of the Mortgage Loans for which a
servicing fee rate of .25% is paid per annum, (ii) 3.25% of the aggregate outstanding
principal amount of the Mortgage Loans as of the termination date paid by the Purchaser
to the Company with respect to all of the Mortgage Loans for which a servicing fee rate
of .375% is paid per annum, and (iii) 3.75% of the aggregate outstanding principal
amount of the Mortgage Loans as of the termination date paid by the Purchaser to the
Company with respect to all of the Mortgage Loans for which a servicing fee rate of .44% or greater is paid per annum.



81









 





ARTICLE XII




MISCELLANEOUS PROVISIONS




Section 12.01 Successor to Company.




     Prior to termination of the Company’s responsibilities and duties under this
Agreement pursuant to Sections 8.04, 10.01, 11.01 (ii) or pursuant to Section 11.02 the
Purchaser shall, (i) succeed to and assume all of the Company’s responsibilities,
rights, duties and obligations under this Agreement, or (ii) appoint a successor having
the characteristics set forth in Section 8.02 and which shall succeed to all rights and
assume all of the responsibilities, duties and liabilities of the Company under this
Agreement prior to the termination of Company’s responsibilities, duties and
liabilities under this Agreement. In connection with such appointment and assumption,
the Purchaser may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree. In the event that the
Company’s duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to the aforementioned sections, the Company shall discharge such
duties and responsibilities during the period from the date it acquires knowledge of
such termination until the effective date thereof with the same degree of diligence and
prudence which it is obligated to exercise under this Agreement, and shall take no
action whatsoever that might impair or prejudice the rights or financial condition of
its successor. The resignation or removal of the Company pursuant to the aforementioned
sections shall not become effective until a successor shall be appointed pursuant to
this Section 12.01 and shall in no event relieve the Company of the representations and
warranties
made pursuant to Sections 3.01 and 3.02 and the remedies available to the Purchaser
under Sections 3.03 and 8.01, it being understood and agreed that the provisions of
such Sections 3.01, 3.02, 3.03 and 8.01 shall be applicable to the Company
notwithstanding any such sale, assignment, resignation or termination of the Company,
or the termination of this Agreement.



     Any successor appointed as provided herein shall execute, acknowledge and deliver
to the Company and to the Purchaser an instrument accepting such appointment, wherein
the successor shall make the representations and warranties set forth in Section 3.01,
except for subsection (h) with respect to the sale of the Mortgage Loans and
subsections (i) and (k) thereof, whereupon such successor shall become fully vested
with all the rights, powers, duties, responsibilities, obligations and liabilities of
the Company, with like effect as if originally named as a party to this Agreement. Any
termination or resignation of the Company or termination of this Agreement pursuant to
Section 8.04, 10.01, 11.01 or 11.02 shall not affect any claims that any Purchaser may
have against the Company arising out of the Company’s actions or failure to act prior
to any such termination or resignation.



     The Company shall deliver promptly to the successor servicer the funds in the
Custodial Account, Subsidy Account and Escrow Account and all Retained Mortgage Files
and related documents and statements held by it hereunder and the Company shall account
for all funds and shall execute and deliver such instruments and do such other things
as may reasonably be required to more fully and definitively vest in the successor all
such rights, powers, duties, responsibilities, obligations and liabilities of the
Company.



82









 





     Upon a successor’s acceptance of appointment as such, the Company shall notify by mail the
Purchaser of such appointment in accordance with the procedures set forth in Section 12.05.



Section 12.02 Amendment.




     This Agreement may be amended from time to time by written agreement signed by the Company and
the Purchaser.



Section 12.03 Governing Law.




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



     Each of the Company and the Purchaser hereby knowingly, voluntarily and intentionally waives
any and all rights it may have to a trial by jury in respect or any litigation based on, or arising
out of, under, or in connection with, this Agreement, or any other documents and instruments
executed in connection herewith, or any course of conduct, course of dealing, statements (whether
oral or written), or actions of the Company or the Purchaser. This provision is a material
inducement for the Purchaser to enter into this Agreement.



Section 12.04 Duration of Agreement.




     This Agreement shall continue in existence and effect until terminated as herein provided.
This Agreement shall continue notwithstanding transfers of the Mortgage Loans by the Purchaser.



Section 12.05 Notices.




     All demands, notices and communications hereunder shall be in writing and shall be deemed to
have been duly given if personally delivered at or mailed by registered mail, postage prepaid,
addressed as follows:




	 	(i)	 	if to the Company with respect to servicing issues:




Wells Fargo Bank, N.A. 

1 Home Campus




83









 







Des Moines, IA 50328-0001

Attention: John B. Brown, MAC X2302-033 

Fax: 515/324-3118





	 	(ii)	 	if to the Company with respect to all other issues:




Wells Fargo Bank, N.A.

7430 New Technology Way 

Frederick, MD 21703

Attention: Structured Finance Manager, MAC X3906-012

Fax: 301/846-8152




     In each instance, with a copy to:


Wells Fargo Bank, N.A.

1 Home Campus

Des Moines, Iowa 50328-0001

Attention: General Counsel MAC X2401-06T



or such other address as may hereafter be furnished to the Purchaser in writing by the Company;





	 	(ii)	 	if to Purchaser:




Redwood Trust, Inc.

One Belvedere Place, Suite 300

Mill Valley, California 94904

Attention: Dan Koch



or such other address as may hereafter be furnished to the Company in writing by the Purchaser;




Section 12.06 Severability of Provisions.




     If any one or more of the covenants, agreements, provisions or terms of this
Agreement shall be held invalid for any reason whatsoever, 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.



Section 12.07 Relationship of Parties.




     Nothing herein contained shall be deemed or construed to create a partnership or
joint venture between the parties hereto and the services of the Company shall be
rendered as an
independent contractor and not as agent for the Purchaser.



84









 





Section 12.08 Execution; Successors and Assigns.




     This Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts, each of which, when so executed, shall be
deemed to be an original; such counterparts, together, shall constitute one and the
same agreement. Subject to Section 8.04, this Agreement shall inure to the benefit of
and be binding upon the Company and the Purchaser and their respective successors and
assigns. The parties agree that this Agreement and signature pages thereof may be
transmitted between them by facsimile and that faxed signatures may constitute original
signatures and that a faxed signature page containing the signature (faxed or original)
is binding on the parties.



Section 12.09 Recordation of Assignments of Mortgage.




     To the extent permitted by applicable law, each of the Assignments of Mortgage 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, such recordation to be effected at the Company’s expense in the event
recordation is either necessary under applicable law or requested by the Purchaser at
its sole option.



Section 12.10 Assignment by Purchaser.




     The Purchaser shall have the right, without the consent of the Company to assign,
in whole or in part, its interest under this Agreement with respect to some or all of
the Mortgage Loans, and designate any Person to exercise any rights of the Purchaser
hereunder, by executing an Assignment, Assumption and Recognition Agreement
substantially in the form attached as Exhibit H, and the assignee or designee shall
accede to the rights and obligations hereunder of the Purchaser with respect to such
Mortgage Loans. All references to the Purchaser in this Agreement shall be deemed to
include its assignee or designee.



Section 12.11 Solicitation of Mortgagor.




     Neither party shall, after the Closing Date, take any action to solicit the
refinancing of any Mortgage Loan. It is understood and agreed that neither (i)
promotions undertaken by either party or any affiliate of either party which are
directed to the general public at large, including, without limitation, mass mailings
based upon commercially acquired mailing lists, newspaper, radio, television
advertisements nor (ii) serving the refinancing needs of a Mortgagor who, without
solicitation, contacts either party in connection with the refinance of such Mortgage
or Mortgage Loan, shall constitute solicitation under this Section.



Section 12.12 Further Agreements.




     The Purchaser and the Company each agree to execute and deliver to the other such
additional documents, instruments or agreements as may be necessary or appropriate to
effectuate the purposes of this Agreement.



85









 





Section 12.13 General Interpretive Principles.




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




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




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




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




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




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




(vi) the term “include” or “including” shall mean without limitation by reason of enumeration.



[Intentionally Blank — Next Page Signature Page]




86









 








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



	 	 	 	 	 	 	 	 	 	 	 
	REDWOOD TRUST, INC.

Purchaser	 	 	 	WELLS FARGO BANK, N.A.

Company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	Name:

	 	 	 	 	 	Name:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	Title:

	 	 	 	 	 	Title:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 






87









 





	 	 	 	 	 	 	 
	STATE OF

	 	 	)	 	 	 
	 

	 	 	)	 	 	ss:
	COUNTY OF                     

	 	 	)	 	 	 






     On the ___ day of                     , 20 ___ before me, a Notary Public in and for said State,
personally appeared ___, known to me to be                      of Wells Fargo Bank, N.A., the national
banking association that executed the within instrument and also known to me to be the person who
executed it on behalf of said bank, and acknowledged to me that such bank executed the within
instrument.



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



	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Notary Public	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	My Commission expires
	 	 

	 	 
	 

	 	 
	 	 

	 	 






88









 





	 	 	 	 	 	 	 
	STATE OF

	 	 	)	 	 	 
	 

	 	 	)	 	 	ss:
	COUNTY OF

	 	 	)	 	 	 






     On the ___ day of                     , 20___ before me, a Notary Public in and for said State,
personally appeared                     , known to me to be the                      of
                    , 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 affixed my office seal the day and year in
this certificate first above written.



	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Notary Public	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	My Commission expires
	 	 

	 	 
	 

	 	 
	 	 

	 	 






89









 





EXHIBIT A




MORTGAGE LOAN SCHEDULE

(WFHM 2007-W17)




 









 





EXHIBIT A-1




MORTGAGE LOAN SCHEDULE

(WFHM 2007-W18)




 









 





EXHIBIT B




CUSTODIAL AGREEMENT




 









 





EXHIBIT C




CONTENTS OF EACH RETAINED MORTGAGE FILE, CUSTODIAL



MORTGAGE FILE AND SERVICING FILE




     With respect to each Mortgage Loan, the Retained Mortgage File, Servicing File and Custodial
Mortgage File shall include each of the following items, which shall be available for inspection by
the Purchaser prior to or after the Closing Date and any prospective purchaser after the Closing
Date, and which shall be either retained by the Company in the Retained Mortgage File or Servicing
File, or delivered to the Custodian pursuant to Sections 2.01 and 2.03 of the Seller’s Warranties
and Servicing Agreement to which this Exhibit is attached (the “Agreement”):



With respect to each Custodial Mortgage File:





	 	1.	 	The original Mortgage Note bearing all intervening endorsements, endorsed “Pay to the order
of without recourse” and signed in the name of the Company by an authorized officer (in the
event that the Mortgage Loan was acquired by the Company in a merger, the signature must be in
the following form: “[Company], successor by merger to [name of predecessor]”; and in the
event that the Mortgage Loan was acquired or originated by the Company while doing business
under another name, the signature must be in the following form: “[Company], formerly known
as [previous name]”).
	 
	 	2.	 	The originals or certified true copies of any document sent for recordation of all
assumption, modification, consolidation or extension agreements, with evidence of recording
thereon.
	 
	 	3.	 	Except in the case of MERS Mortgage Loans, the original Assignment of Mortgage for each
Mortgage Loan, in form and substance acceptable for recording (except for the insertion of the
name of the assignee and recording information). The Assignment of Mortgage must be duly
recorded only if recordation is either necessary under applicable law or commonly required by
private institutional mortgage investors in the area where the Mortgaged Property is located
or on direction of the Purchaser. If the Assignment of Mortgage is to be recorded, the
Mortgage shall be assigned to the Purchaser. If the Assignment of Mortgage is not to be
recorded, the Assignment of Mortgage shall be delivered in blank. If the Mortgage Loan was
acquired by the Company in a merger, the Assignment of Mortgage must be made by “[Company],
successor by merger to [name of predecessor].” If the Mortgage Loan was acquired or
originated by the Company while doing business under another name, the Assignment of Mortgage
must be by “[Company], formerly know as [previous name].”
	 
	 	4.	 	The original of any guarantee executed in connection with the Mortgage Note.
	 
	 	5.	 	Original or copy of power of attorney, if applicable.





With respect to each Retained Mortgage File:





	 	6.	 	Except with respect to a MERS Mortgage Loan, the original Mortgage, with evidence of
recording thereon or a certified true and correct copy of the Mortgage sent for recordation.
If in connection with any Mortgage Loan, the Company cannot deliver or cause to be delivered
the original Mortgage with evidence of recording thereon on or prior to the Closing Date
because of a delay caused by the public recording office where such Mortgage has been
delivered for




 









 






	 	 	 	recordation or because such Mortgage has been lost or because such public recording office retains
the original recorded Mortgage, the Company shall deliver or cause to be delivered to the
Custodian, a photocopy of such Mortgage, together with (i) in the case of a delay caused by the
public recording office, an Officer’s Certificate of the Company stating that such Mortgage has
been dispatched to the appropriate public recording office for recordation and that the original
recorded Mortgage or a copy of such Mortgage certified by such public recording office to be a true
and complete copy of the original recorded Mortgage will be promptly delivered to the Custodian
upon receipt thereof by the Company; or (ii) in the case of a Mortgage where a public recording
office retains the original recorded Mortgage or in the case where a Mortgage is lost after
recordation in a public recording office, a copy of such Mortgage certified by such public
recording office or by the title insurance company that issued the title policy to be a true and
complete copy of the original recorded Mortgage.






	 	 	 	For each MERS Mortgage Loan, the original Mortgage, noting the presence of the MIN for that
Mortgage Loan and either language indicating that the Mortgage Loan was originated in the name of
MERS, or if the Mortgage Loan was not originated in the name of MERS, the original Mortgage and the
assignment to MERS, with evidence of recording thereon. Further, with respect to MERS Mortgage
Loans, (a) the Mortgage names MERS as the Mortgagee and (b) the requirements set forth in the
Electronic Tracking Agreement have been satisfied, with a conformed recorded copy to follow as soon
as the same is received by the Company.
	 
	 	7.	 	Except with respect to a MERS Mortgage Loan, originals or certified true copies of documents
sent for recordation of all intervening assignments of the Mortgage with evidence of recording
thereon, or if any such intervening assignment has not been returned from the applicable
recording office or has been lost or if such public recording office retains the original
recorded assignments of mortgage, the Company shall deliver or cause to be delivered to the
Custodian, a photocopy of such intervening assignment, together with (i) in the case of a
delay caused by the public recording office, an Officer’s Certificate of the Company stating
that such intervening assignment of mortgage has been dispatched to the appropriate public
recording office for recordation and that such original recorded intervening assignment of
mortgage or a copy of such intervening assignment of mortgage certified by the appropriate
public recording office or by the title insurance company that issued the title policy to be a
true and complete copy of the original recorded intervening assignment of mortgage will be
promptly delivered to the Custodian upon receipt thereof by the Company; or (ii) in the case
of an intervening assignment where a public recording office retains the original recorded
intervening assignment or in the case where an intervening assignment is lost after
recordation in a public recording office, a copy of such intervening assignment certified by
such public recording office to be a true and complete copy of the original recorded
intervening assignment.
	 
	 	8.	 	The electronic form of PMI Policy as identified by certificate number.
	 
	 	9.	 	The original mortgagee policy of title insurance or other evidence of title such as a copy of
the title commitment or copy of the preliminary title commitment.
	 
	 	10.	 	Any security agreement, chattel mortgage or equivalent executed in connection with the
Mortgage.
	 
	 	11.	 	For each Cooperative Loan, the original or a copy of the following:





 









 






	 	 	 	The Pledge Agreement entered into by the Mortgagor with respect to such Cooperative Loan;
	 
	 	 	 	UCC-3
assignment in blank (or equivalent instrument), sufficient under the laws of the jurisdiction where
the related Cooperative Apartment is located to reflect of record the sale and assignment of the
Cooperative Loan to the Purchaser;
	 
	 	 	 	Assignment of Pledge Agreement in blank showing a complete chain
of assignment
from the originator of the related Cooperative Loan to the Company;
	 
	 	 	 	Form UCC-1 and any continuation
statements with evidence of filing thereon with respect to such Cooperative Loan;
	 
	 	 	 	Cooperative
Shares with a Stock Certificate in blank attached; 

Proprietary Lease;
	 
	 	 	 	Assignment of Proprietary
Lease, in blank, and all intervening assignments thereof;
	 
	 	 	 	Recognition agreement of the interests of
the mortgagee with respect to the Cooperative Loan by the Cooperative, the stock of which was
pledged by the related Mortgagor to the originator of such Cooperative Loan; and
	 
	 	 	 	Any assumption,
consolidation or modification agreements relating to any of the items specified above.
	 
	 	12.	 	For each Pledged Asset Mortgage Loan, an Assigned Letter of Credit, in accordance with Section
4.27.




With respect to each Mortgage Loan, the Servicing File shall include each of the following items to
the extent in the possession of the Company or in the possession of the Company’s agent(s):





	 	13.	 	The original hazard insurance policy and, if required by law, flood insurance policy, in
accordance with Section 4.10 of the Agreement.
	 
	 	14.	 	Residential loan application.
	 
	 	15.	 	Mortgage Loan closing statement.
	 
	 	16.	 	Verification of employment and income, unless originated under the Company’s Limited
Documentation program, Fannie Mae Timesaver Plus.
	 
	 	17.	 	Verification of acceptable evidence of source and amount of down payment, including any related
asset verification, if applicable.
	 
	 	18.	 	Credit report on the Mortgagor.
	 
	 	19.	 	Residential appraisal report, including the related completion certificate, if applicable.
	 
	 	20.	 	Photograph of the Mortgaged Property.
	 
	 	21.	 	Survey of the Mortgage property, if required by the title company or applicable law.




 









 












	 	22.	 	Copy of each instrument necessary to complete identification of any exception set forth in the
exception schedule in the title policy, i.e. map or plat, restrictions, easements, sewer
agreements, home association declarations, etc.
	 
	 	23.	 	All required disclosure statements.
	 
	 	24.	 	If available, termite report, structural engineer’s report, water potability and septic
certification.
	 
	 	25.	 	Sales contract, if applicable.
	 
	 	26.	 	Evidence of payment of taxes and insurance premiums, insurance claim files, correspondence,
current and historical computerized data files, and all other processing, underwriting and closing
papers and records which are customarily contained in a mortgage loan file and which are required
to document the Mortgage Loan or to service the Mortgage Loan.
	 
	 	27.	 	Amortization schedule, if available.
	 
	 	28.	 	Payment history for any Mortgage Loan that has been closed for more than 90 days.





     In the event an Officer’s Certificate of the Company is delivered to the Custodian because of
a delay caused by the public recording office in returning any recorded document, the Company shall
deliver to the Custodian, within 240 days of the Closing Date, an Officer’s Certificate which shall
(i) identify the recorded document, (ii) state that the recorded document has not been delivered to
the Custodian due solely to a delay caused by the public recording office, (iii) state the amount
of time generally required by the applicable recording office to record and return a document
submitted for recordation, and (iv) specify the date the applicable recorded document will be
delivered to the Custodian. The Company shall be required to deliver to the Custodian the
applicable recorded document by the date specified in (iv) above. An extension of the date
specified in (iv) above may be requested from the Purchaser, which consent shall not be
unreasonably withheld.



     Notwithstanding Paragraphs 1 and 3 above, the Purchaser acknowledges that the Company may
deliver (i) a Mortgage Note for which the chain of endorsements is not identical to that of the
intervening Assignments with respect to such Mortgage Note, which shall not affect the
enforceability of such Mortgage Note, and/or (ii) intervening Assignments which are not identical
to the chain of endorsements with respect to such Mortgage Note, which shall not affect the
validity of such intervening Assignments; provided, however, that such acknowledgment shall in no
way operate to negate the Purchaser’s remedies for the Company’s breach of the representations and
warranties under this Agreement.



 









 





EXHIBIT D




DATA FILE ELEMENTS





	(1)	 	the Mortgage Loan number;
	 
	(2)	 	the street address of the Mortgaged Property including the city, state, county and zip code;
	 
	(3)	 	a code indicating whether the Mortgaged Property is a single family residence, a 2-4 family
dwelling, a PUD, a cooperative, a townhouse, manufactured housing or a unit in a condominium
project;
	 
	(4)	 	the Mortgage Interest Rate as of the Cut-off Date;
	 
	(5)	 	the current Monthly Payment;
	 
	(6)	 	the original loan term (in number of months);
	 
	(7)	 	the stated maturity date;
	 
	(8)	 	the Stated Principal Balance of the Mortgage Loan as of the close of business on the Cut-off
Date, after deduction of payments of principal due on or before the Cut-off Date;
	 
	(9)	 	the Loan-to-Value Ratio;
	 
	(10)	 	a code indicating whether the Mortgage Loan is an Interest Only Mortgage Loan;
	 
	(11)	 	a code indicating whether the Mortgage Loan is a temporary buydown (Y or N);
	 
	(12)	 	the Servicing Fee Rate;
	 
	(13)	 	a code indicating whether the Mortgage Loan is covered by lender-paid mortgage insurance (Y
or N);
	 
	(14)	 	a code indicating whether the Mortgage Loan is a Time$aver® Mortgage Loan (Y or N);
	 
	(15)	 	the Mortgagor’s first and last name;
	 
	(16)	 	a code indicating a Co-Borrower (Y or N);
	 
	(17)	 	the Co-Borrower’s first and last name, if applicable;
	 
	(18)	 	a code indicating whether the Mortgaged Property is owner-occupied, a second home or an
investment property;
	 
	(19)	 	the remaining months to maturity from the Cut-off Date, based on the original amortization
schedule;
	 
	(20)	 	the date on which the first Monthly Payment was due on the Mortgage Loan;




 









 












	(21)	 	the last Due Date on which a Monthly Payment was actually applied to the actual principal
balance;
	 
	(22)	 	the original principal amount of the Mortgage Loan;
	 
	(23)	 	a code indicating the purpose of the loan (i.e., purchase, financing, rate/term refinancing, cash-out refinancing);
	 
	(24)	 	the Mortgage Interest Rate at origination;
	 
	(25)	 	a code indicating the documentation style (i.e., full (providing two years employment
verification — 2 years W-2’s and current pay stub or 2 years 1040’s for self employed borrowers),
alternative or reduced);
	 
	(26)	 	a code indicating if the Mortgage Loan is subject to a PMI Policy;
	 
	(27)	 	the Appraised Value of the Mortgage Property;
	 
	(28)	 	the sale price of the Mortgaged Property, if applicable;
	 
	(29)	 	the Mortgagor’s underwriting FICO score;
	 
	(30)	 	term of Prepayment Penalty in years;
	 
	(31)	 	a code indicating the product type;
	 
	(32)	 	a code indicating the credit grade of the Mortgage Loan;
	 
	(33)	 	the unpaid balance of the Mortgage Loan as of the close of business on the Cut-off Date, after
deduction of all payments of principal;
	 
	(34)	 	the Mortgage Note date of the Mortgage Loan;
	 
	(35)	 	the mortgage insurance certificate number and percentage of coverage, if applicable;
	 
	(36)	 	the Mortgagor’s date of birth;
	 
	(37)	 	if the Mortgage Loan is a MERS Mortgage Loan, the MIN, if applicable;
	 
	(38)	 	employer name;
	 
	(39)	 	subsidy program code;
	 
	(40)	 	servicer name;
	 
	(41)	 	the combined Loan-to-Value Ratio at origination;
	 
	(42)	 	the total Loan-to-Value Ratio;





 









 






	(43)	 	whether the Mortgage Loan is convertible (Y or N);
	 
	(44)	 	a code indicating whether the Mortgage Loan is a relocation loan (Y or N);
	 
	(45)	 	a code
indicating whether the Mortgage Loan is a leasehold loan (Y or N); 
	 
	(46)	 	a code indicating
whether the Mortgage Loan is an Alt A loan (Y or N);
	 
	(47)	 	a code indicating whether the
Mortgage Loan is a no ratio loan (Y or N);
	 
	(48)	 	a code indicating whether the Mortgage Loan is a Pledged Asset Mortgage Loan (Y or N);
	 
	(49)	 	effective LTV percentage for Pledged Asset Mortgage Loan;
	 
	(50)	 	citizenship type code;
	 
	(51)	 	a code indicating whether the Mortgage Loan is a conforming or non-conforming loan, based on
the original loan balance;
	 
	(52)	 	the name of the client for which the Mortgage Loan was originated;
	 
	(53)	 	a code indicating amortization type (1= Full or 2=IO);
	 
	(54)	 	a code indicating interest-only terms in months for Interest Only Mortgage Loans;
	 
	(55)	 	the remaining interest-only term for Interest-Only Mortgage Loans;
	 
	(56)	 	a date when first full payment is due after interest-only period is over for Interest Only
Mortgage Loans;
	 
	(57)	 	the current monthly tax and insurance payment;
	 
	(58)	 	a code indicating whether the Mortgage Loan was originated through the correspondent, retail
or wholesale channel;
	 
	(59)	 	front end debt-to-income ratio;
	 
	(60)	 	back end debt-to-income ratio;
	 
	(61)	 	a code indicating borrower or lender verification of assets (B or L);
	 
	(62)	 	combined balance of the first lien and second lien mortgage loan balances, if applicable;
	 
	(63)	 	a code indicating age of Mortgage Loan in months;
	 
	(64)	 	a code indicating delinquency status for last twelve (12) months (rolling);
	 
	(65)	 	updated FICO score;





 









 






	(66)	 	a code indicating if borrower is self-employed (Y or N);
	 
	(67)	 	a policy number or certificate number of the physical document evidencing mortgage insurance;
	 
	(68)	 	a borrower’s prior rent or mortgage payment history (not associated with subject Mortgage
Loan);
	 
	(69)	 	the appraisal form used to document the Appraisal Value of the Mortgage Property;
	 
	(70)	 	documentation type translated to Moody’s definition;
	 
	(71)	 	type of asset verification utilized for decisioning the loan, translated to Moody’s definitions;
	 
	(72)	 	documentation type translated to Standard and Poor’s definition;
	 
	(73)	 	type of asset verification utilized for decisioning the loan, translated to Standard and Poor’s
definitions;
	 
	(74)	 	documentation type translated to Fitch’s definition;





The Company shall provide the following

For the Home Mortgage Disclosure Act (HMDA):





	(75)	 	the Mortgagor’s and co-Mortgagor’s (if applicable) ethnicity;
	 
	(76)	 	the Mortgagor’s and co-Mortgagor’s (if applicable) race;
	 
	(77)	 	lien status;
	 
	(78)	 	for cash-out refinance loans, the cash purpose;
	 
	(79)	 	the Mortgagor’s and co-Mortgagor’s (if applicable) gender;
	 
	(80)	 	the Mortgagor’s and co-Mortgagor’s (if applicable) social security numbers;
	 
	(81)	 	the number of units for the property;
	 
	(82)	 	the year in which the property was built;
	 
	(83)	 	the qualifying monthly income of the Mortgagor;
	 
	(84)	 	the number of bedrooms contained in the Mortgaged Property;
	 
	(85)	 	a code indicating first time buyer (Y or N);
	 
	(86)	 	the total rental income, if any;





The Seller shall provide the following




 









 





for the Adjustable Rate Mortgage Loans (if applicable):





	(87)	 	the maximum Mortgage Interest Rate under the terms of the Mortgage Note for Adjustable Rate
Mortgage Loans;
	 
	(88)	 	the Periodic Interest Rate Cap for Adjustable Rate Mortgage Loans;
	 
	(89)	 	the Index for Adjustable Rate Mortgage Loans;
	 
	(90)	 	the next Adjustment Date for Adjustable Rate Mortgage Loans;
	 
	(91)	 	the Gross Margin for Adjustable Rate Mortgage Loans;
	 
	(92)	 	the lifetime interest rate cap for Adjustable Rate Mortgage Loans;
	 
	(93)	 	the initial rate cap for Adjustable Rate Mortgage Loans;
	 
	(94)	 	the first adjustment cap for Adjustable Rate Mortgage Loans;
	 
	(95)	 	minimum interest rate allowed per Mortgage Note for Adjustable Rate Mortgage Loans;
	 
	(96)	 	look-back period for Adjustable Rate Mortgage Loans (to determine loan index);
	 
	(97)	 	minimum rate first adjustment period percent for Adjustable Rate Mortgage Loans;
	 
	(98)	 	maximum rate first adjustment period percent for Adjustable Rate Mortgage Loans.





 









 





EXHIBIT E




FORM OF OPINION OF COUNSEL




@

@

@

@





			
	Re:	 	Wells Fargo Bank, N.A.

Mortgage Loan Series @





Dear Sir/Madam:



I am @ of Wells Fargo Bank, N.A. and have acted as counsel to Wells Fargo Bank, N.A. (the
“Company”), with respect to certain matters in connection with the sale by the Company of the
mortgage loans designated as Mortgage Loan Series @ (the “Mortgage Loans”) pursuant to that certain
Seller’s Warranties and Servicing Agreement by and between the Company and @ (the “Purchaser”),
dated as of @, 20___, (the “Agreement”), which sale is in the form of whole Mortgage Loans.
Capitalized terms not otherwise defined herein have the meanings set forth in the Agreement.




I have examined the following documents:





	1.	 	the Seller’s Warranties and Servicing Agreement;
	 
	2.	 	the Custodial Agreement;
	 
	3.	 	the form of endorsement of the Mortgage Notes; and
	 
	4.	 	such other documents, records and papers as I have deemed necessary and relevant as a basis
for this opinion.




To the extent I have deemed necessary and proper, I have relied upon the representations and
warranties of the Company contained in the Agreement. I have assumed the authenticity of all
documents submitted to me as originals, the genuineness of all signatures, the legal capacity of
natural persons and the conformity to the originals of all documents.




Based upon the foregoing, it is my opinion that;





	1.	 	The Company is a national banking association duly organized, validly existing and in good
standing under the laws of the United States.
	 
	2.	 	The Company has the power to engage in the transactions contemplated by the Agreement, the
Custodial Agreement and all requisite power, authority and legal right to execute and deliver
the




 









 






	 	 	Agreement, the Custodial Agreement and the Mortgage Loans, and to perform and observe the terms and
conditions of such instruments.






	3.	 	Each person who, as an officer or attorney-in-fact of the Company, signed (a) the Agreements
and (b) any other document delivered prior hereto or on the date hereof in connection with the
sale and servicing of the Mortgage Loans in accordance with the Agreements was, at the
respective times of such signing and delivery, and is, as of the date hereof, duly elected or
appointed, qualified and acting as such officer or attorney-in-fact, and the signatures of
such persons appearing on such documents are their genuine signatures.
	 
	4.	 	Each of the Agreement, the Custodial Agreement, and the Mortgage Loans, has been duly
authorized, executed and delivered by the Company and is a legal, valid and binding agreement
enforceable in accordance with its terms, subject to the effect of insolvency, liquidation,
conservatorship and other similar laws administered by the Federal Deposit Insurance
Corporation affecting the enforcement of contract obligations of insured banks and subject to
the application of the rules of equity, including those respecting the availability of
specific performance, none of which will materially interfere with the realization of the
benefits provided thereunder or with the Purchaser’s ownership of the Mortgage Loans.
	 
	5.	 	The Company has been duly authorized to allow any of its officers to execute any and all
documents by original or facsimile signature in order to complete the transactions
contemplated by the Agreement and the Custodial Agreement and in order to execute the
endorsements to the Mortgage Notes and the assignments of the Mortgages, and the original or
facsimile signature of the officer at the Company executing the Agreement, the Custodial
Agreement, the endorsements to the Mortgage Notes and the assignments of the Mortgages
represents the legal and valid signature of said officer of the Company.
	 
	6.	 	Either (i) no consent, approval, authorization or order of any court or governmental agency
or body is required for the execution, delivery and performance by the Company of or
compliance by the Company with the Agreement, the Custodial Agreement or the sale and delivery
of the Mortgage Loans or the consummation of the transactions contemplated by the Agreement
and the Custodial Agreement; or (ii) any required consent, approval, authorization or order
has been obtained by the Company.
	 
	7.	 	Neither the consummation of the transactions contemplated by, nor the fulfillment of the
terms of the Agreement and the Custodial Agreement, will conflict with or results in or will
result in a breach of or constitutes or will constitute a default under the charter or by-laws
of the Company, the terms of any indenture or other agreement or instrument to which the
Company is a party or by which it is bound or to which it is subject, or violates any statute
or order, rule, regulations, writ, injunction or decree of any court, governmental authority
or regulatory body to which the Company is subject or by which it is bound.
	 
	8.	 	There is no action, suit, proceeding or investigation pending or, to the best of my
knowledge, threatened against the Company which, in my opinion, either in any one instance or
in the aggregate, may result in any material adverse change in the business, operations,
financial condition, properties or assets of the Company or in any material impairment of the
right or ability of the Company to carry on its business substantially as now conducted or in
any material liability on the part of the Company or which would draw into question the
validity of the Agreement, and the Custodial Agreement, or of any action taken or to be taken
in connection with the transactions contemplated thereby, or which would be likely to impair
materially the ability of the Company to perform under the terms of the Agreement and the
Custodial Agreement.




 









 












	9.	 	For purposes of the foregoing, I have not regarded any legal or governmental actions,
investigations or proceedings to be “threatened” unless the potential litigant or governmental
authority has manifested to the legal department of the Company or an employee of the Company
responsible for the receipt of process a present intention to initiate such proceedings; nor
have I regarded any legal or governmental actions, investigations or proceedings as including
those that are conducted by state or federal authorities in connection with their routine
regulatory activities. The sale of each Mortgage Note and Mortgage as and in the manner
contemplated by the Agreements is sufficient fully to transfer all right, title and interest
of the Company thereto as noteholder and mortgagee, apart from the rights to service the
Mortgage Loans pursuant to the Agreement.
	 
	10.	 	The form of endorsement that is to be used with respect to the Mortgage Loans is legally valid
and sufficient to duly endorse the Mortgage Notes to the Purchaser. Upon the completion of the
endorsement of the Mortgage Notes and the completion of the assignments of the Mortgages, and the
recording thereof, the endorsement of the Mortgage Notes, the delivery to the Custodian of the
completed assignments of the Mortgages, and the delivery of the original endorsed Mortgage Notes to
the Custodian would be sufficient to permit the entity to which such Mortgage Note is initially
endorsed at the Purchaser’s direction, and to whom such assignment of Mortgages is initially
assigned at the Purchaser’s direction, to avail itself of all protection available under applicable
law against the claims of any present or future creditors of the Company, and would be sufficient
to prevent any other sale, transfer, assignment, pledge or hypothecation of the Mortgages and the
Mortgage Notes by the Company from being enforceable.




This opinion is given to you for your sole benefit, and no other person or entity is entitled to
rely hereon except that the purchaser or purchasers to which you initially and directly resell the
Mortgage Loans may rely on this opinion as if it were addressed to them as of its date.




Sincerely,




@

@




@/@




 









 







EXHIBIT F




SERVICING CRITERIA TO BE ADDRESSED

IN ASSESSMENT OF COMPLIANCE



The assessment of compliance to be delivered by [the Company][Name of Subservicer] shall
address, as a minimum, the criteria identified below as “Applicable Servicing Criteria”




	 	 	 	 	 	 	 
	 	 	 	 	Applicable	 	Inapplicable
	Reg AB	 	 	 	Servicing	 	Servicing
	Reference	 	Servicing Criteria	 	Criteria	 	Criteria
	 

	 	General Servicing Considerations	 	 	 	 
	 
	1122(d)(1)(i)

	 	Policies and procedures are instituted to monitor any performance or other
triggers and events of default in accordance with the transaction agreements.
	 	X	 	 
	 
	1122(d)(1)(ii)

	 	If any material servicing activities are outsourced to third parties, policies
and procedures are instituted to monitor the third party’s performance and
compliance with such servicing activities.
	 	X	 	 
	 
	1122(d)(1)(iii)

	 	Any requirements in the transaction agreements to maintain a back-up
servicer for the mortgage loans are maintained.
	 	 	 	X
	 
	1122(d)(1)(iv)

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

	 	Cash Collection and Administration	 	 	 	 
	 
	1122(d)(2)(i)

	 	Payments on mortgage loans are deposited into the appropriate custodial
bank accounts and related bank clearing accounts no more than two business
days following receipt, or such other number of days specified in the
transaction agreements.
	 	X	 	 
	 
	1122(d)(2)(ii)

	 	Disbursements made via wire transfer on behalf of an obligor or to an
investor are made only by authorized personnel.
	 	X	 	 
	 
	1122(d)(2)(iii)

	 	Advances of funds or guarantees regarding collections, cash flows or
distributions, and any interest or other fees charged for such advances, are
made, reviewed and approved as specified in the transaction agreements.
	 	X	 	 
	 
	1122(d)(2)(iv)

	 	The related accounts for the transaction, such as cash reserve accounts or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth in the
transaction agreements.
	 	X	 	 
	 
	1122(d)(2)(v)

	 	Each custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes of this
criterion, “federally insured depository institution” with respect to a foreign
financial institution means a foreign financial institution that meets the
requirements of Rule 13k-1(b)(1) of the Securities Exchange Act.
	 	X	 	 
	 
	1122(d)(2)(vi)

	 	Unissued checks are safeguarded so as to prevent unauthorized access.
	 	X	 	 
	 
	1122(d)(2)(vii)

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

	 	Investor Remittances and Reporting	 	 	 	 
	 
	1122(d)(3)(i)

	 	Reports to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
	 	X	 	 






 









 






	 	 	 	 	 	 	 
	 	 	 	 	Applicable	 	Inapplicable
	Reg AB	 	 	 	Servicing	 	Servicing
	Reference	 	Servicing Criteria	 	Criteria	 	Criteria
	 

	 	Commission requirements. Specifically, such reports (A) are prepared in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with the terms
specified in the transaction agreements; (C) are filed with the Commission
as required by its rules and regulations; and (D) agree with investors’ or the
trustee’s records as to the total unpaid principal balance and number of
mortgage loans serviced by the Servicer.	 	 	 	 
	 
	1122(d)(3)(ii)

	 	Amounts due to investors are allocated and remitted in accordance with
timeframes, distribution priority and other terms set forth in the transaction
agreements.
	 	X	 	 
	 
	1122(d)(3)(iii)

	 	Disbursements made to an investor are posted within two business days to
the Servicer’s investor records, or such other number of days specified in
the transaction agreements.
	 	X	 	 
	 
	1122(d)(3)(iv)

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




Pool Asset Administration 

	 	X	 	 
	 
	1122(d)(4)(i)

	 	
Collateral or security on mortgage loans is maintained as required by the
transaction agreements or related mortgage loan documents.
	 	X	 	 
	 
	1122(d)(4)(ii)

	 	Mortgage loan and related documents are safeguarded as required by the
transaction agreements
	 	X	 	 
	 
	1122(d)(4)(iii)

	 	Any additions, removals or substitutions to the asset pool are made,
reviewed and approved in accordance with any conditions or requirements
in the transaction agreements.
	 	X	 	 
	 
	1122(d)(4)(iv)

	 	Payments on mortgage loans, including any payoffs, made in accordance
with the related mortgage loan documents are posted to the Servicer’s
obligor records maintained no more than two business days after receipt, or
such other number of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g., escrow) in accordance
with the related mortgage loan documents.
	 	X	 	 
	 
	1122(d)(4)(v)

	 	The Servicer’s records regarding the mortgage loans agree with the
Servicer’s records with respect to an obligor’s unpaid principal balance.
	 	X	 	 
	 
	1122(d)(4)(vi)

	 	Changes with respect to the terms or status of an obligor’s mortgage loans
(e.g., loan modifications or re-agings) are made, reviewed and approved by
authorized personnel in accordance with the transaction agreements and
related pool asset documents.
	 	X	 	 
	 
	1122(d)(4)(vii)

	 	Loss mitigation or recovery actions (e.g., forbearance plans, modifications
and deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance with the
timeframes or other requirements established by the transaction agreements.
	 	X	 	 
	 
	1122(d)(4)(viii)

	 	Records documenting collection efforts are maintained during the period a
mortgage loan is delinquent in accordance with the transaction agreements.
Such records are maintained on at least a monthly basis, or such other period
specified in the transaction agreements, and describe the entity’s activities in
monitoring delinquent mortgage loans including, for example, phone calls,
letters and payment rescheduling plans in cases where delinquency is
deemed temporary (e.g., illness or unemployment).
	 	X	 	 
	 
	1122(d)(4)(ix)

	 	Adjustments to interest rates or rates of return for mortgage loans with
variable rates are computed based on the related mortgage loan documents.
	 	X	 	 
	 
	1122(d)(4)(x)

	 	Regarding any funds held in trust for an obligor (such as escrow accounts):
(A) such funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified in the
transaction agreements; (B) interest on such funds is paid, or credited, to
obligors in accordance with applicable mortgage loan documents and state
laws; and (C) such funds are returned to the obligor within 30 calendar days
of full repayment of the related mortgage loans, or such other number of
days specified in the transaction agreements.
	 	X	 	 
	 
	1122(d)(4)(xi)

	 	Payments made on behalf of an obligor (such as tax or insurance payments)
are made on or before the related penalty or expiration dates, as indicated on
	 	X	 	 






 









 






	 	 	 	 	 	 	 
	 	 	 	 	Applicable	 	Inapplicable
	Reg AB	 	 	 	Servicing	 	Servicing
	Reference	 	Servicing Criteria	 	Criteria	 	Criteria
	 

	 	the appropriate bills or notices for such payments, provided that such
support has been received by the servicer at least 30 calendar days prior to
these dates, or such other number of days specified in the transaction
agreements.	 	 	 	 
	 
	1122(d)(4)(xii)

	 	Any late payment penalties in connection with any payment to be made on
behalf of an obligor are paid from the Servicer’s funds and not charged to
the obligor, unless the late payment was due to the obligor’s error or
omission.
	 	X	 	 
	 
	1122(d)(4)(xiii)

	 	Disbursements made on behalf of an obligor are posted within two business
days to the obligor’s records maintained by the servicer, or such other
number of days specified in the transaction agreements.
	 	X	 	 
	 
	1122(d)(4)(xiv)

	 	Delinquencies, charge-offs and uncollectible accounts are recognized and
recorded in accordance with the transaction agreements.
	 	X	 	 
	 
	1122(d)(4)(xv)

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






 









 






EXHIBIT G




SARBANES CERTIFICATION





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




I,                                         , the                               
           of [Name of Servicer] (the
“Servicer”), certify to [the Purchaser], [the Depositor], and the [Master Servicer] [Securities
Administrator] [Trustee], and their officers, with the knowledge and intent that they will rely
upon this certification, that:





(1) I have reviewed the servicer compliance statement of the Servicer provided in
accordance with Item 1123 of Regulation AB (the “Compliance Statement”), the report on
assessment of the Servicer’s compliance with the servicing criteria set forth in Item
1122(d) of Regulation AB (the “Servicing Criteria”), provided in accordance with Rules
13a-18 and 15d-18 under Securities Exchange Act of 1934, as amended (the “Exchange Act”)
and Item 1122 of Regulation AB (the “Servicing Assessment”), the registered public
accounting firm’s attestation report provided in accordance with Rules 13a-18 and 15d-18
under the Exchange Act and Section 1122(b) of Regulation AB (the “Attestation Report”), and
all servicing reports, officer’s certificates and other information relating to the
servicing of the Mortgage Loans by the Servicer during 200[ ] that were delivered by the
Servicer to the [Depositor] [Master Servicer] [Securities Administrator]
[Trustee] pursuant to the Agreement (collectively, the “Servicer Servicing Information”);




(2) Based on my knowledge, the Servicer Servicing Information, taken as a whole, does not
contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in the light of the circumstances under which such statements were made, not
misleading with respect to the period of time covered by the Servicer Servicing Information;




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




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




(5) The Compliance Statement required to be delivered by the Servicer pursuant to the Agreement,
and the Servicing Assessment and Attestation Report required to be provided by the Servicer and by
any Subservicer or Subcontractor pursuant to the Agreement have been provided to the [Depositor]
[Master Servicer]. Any material instances of noncompliance described in such reports have been
disclosed to the [Depositor] [Master Servicer]. Any material instance of noncompliance with the
Servicing Criteria has been disclosed in such reports.



	 	 	 	 	 	 	 
	 

	 	Date:	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 






 









 





EXHIBIT H




ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT




                    , 20__




     ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT, dated                     , 20___ between
                    , a                      corporation having an office at                     
(“Assignor”) and                     , having an office at                      (“Assignee”):



     For and in consideration of the sum of one dollar ($1.00) and other valuable consideration the
receipt and sufficiency of which are hereby acknowledge, and of the mutual covenants herein
contained, the parties hereto hereby agree as follows:



     1. The Assignor hereby grants, transfers and assigns to Assignee all of the right, title and
interest of Assignor, as Purchaser, in, to and under that certain Seller’s Warranties and Servicing
Agreement, (the “Seller’s Warranties and Servicing Agreement”), dated as of                     , by
and between                      (the “Purchaser”), and                      (the “Company”), and the
Mortgage Loans delivered thereunder by the Company to the Assignor, and that certain Custodial
Agreement, (the “Custodial Agreement”), dated as of                     , by and among the Company,
the Purchaser and                      (the “Custodian”).



     2. The Assignor warrants and represents to, and covenants with, the Assignee that:



          a. The Assignor is the lawful owner of the Mortgage Loans with the full right to transfer the
Mortgage Loans free from any and all claims and encumbrances whatsoever;




          b. The Assignor has not received notice of, and has no knowledge of, any offsets,
counterclaims or other defenses available to the Company with respect to the Seller’s Warranties
and Servicing Agreement or the Mortgage Loans;




          c. The Assignor has not waived or agreed to any waiver under, or agreed to any amendment or
other modification of, the Seller’s Warranties and Servicing Agreement, the Custodial Agreement or
the Mortgage Loans, including without limitation the transfer of the servicing obligations under
the Seller’s Warranties and Servicing Agreement. The Assignor has no knowledge of, and has not
received notice of, any waivers under or amendments or other modifications of, or assignments of
rights or obligations under, the Seller’s Warranties and Servicing Agreement or the Mortgage Loans;
and




          d. Neither the Assignor nor anyone acting on its behalf has offered, transferred, pledged,
sold or otherwise disposed of the Mortgage Loans, any interest in the Mortgage Loans or any other
similar security to, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Mortgage Loans, any interest in the Mortgage Loans or any other similar security
from, or otherwise approached or negotiated with respect to the Mortgage Loans, any interest in the
Mortgage Loans or any other similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken any other action
which would constitute a distribution of the Mortgage Loans under the Securities Act of 1933 (the
“33 Act”) or which would render the disposition of the Mortgage Loans a violation of Section 5 of
the 33 Act or require registration pursuant thereto.




 









 








     3. That Assignee warrants and represent to, and covenants with, the Assignor and the Company
pursuant to Section 12.10 of the Seller’s Warranties and Servicing Agreement that:



          a. The Assignee agrees to be bound, as Purchaser, by all of the terms, covenants and
conditions of the Seller’s Warranties and Servicing Agreement, the Mortgage Loans and the Custodial
Agreement, and from and after the date hereof, the Assignee assumes for the benefit of each of the
Company and the Assignor all of the Assignor’s obligations as purchaser thereunder;




          b. The Assignee understands that the Mortgage Loans have not been registered under the 33 Act
or the securities laws of any state;




          c. The purchase price being paid by the Assignee for the Mortgage Loans are in excess of
$250,000.00 and will be paid by cash remittance of the full purchase price within 60 days of the
sale;




          d. The Assignee is acquiring the Mortgage Loans for investment for its own account only and
not for any other person. In this connection, neither the Assignee nor any person authorized to act
therefor has offered to sell the Mortgage Loans by means of any general advertising or general
solicitation within the meaning of Rule 502(c) of US Securities and Exchange Commission Regulation
D, promulgated under the 1933 Act;




          e. The Assignee considers itself a substantial sophisticated institutional investor having
such knowledge and experience in financial and business matters that it is capable of evaluating
the merits and risks of investment in the Mortgage Loans;




          f. The Assignee has been furnished with all information regarding the Mortgage Loans that it
has requested from the Assignor or the Company;




          g. Neither the Assignee nor anyone acting on its behalf has offered, transferred, pledged,
sold or otherwise disposed of the Mortgage Loans, any interest in the Mortgage Loans or any other
similar security to, or solicited any offer to buy or accepted a transfer, pledge or other
disposition of the Mortgage Loans, any interest in the Mortgage Loans or any other similar security
from, or otherwise approached or negotiated with respect to the Mortgage Loans, any interest in the
Mortgage Loans or any other similar security with, any person in any manner which would constitute
a distribution of the Mortgage Loans under the 33 Act or which would render the disposition of the
Mortgage Loans a violation of Section 5 of the 33 Act or require registration pursuant thereto, nor
will it act, nor has it authorized or will it authorize any person to act, in such manner with
respect to the Mortgage Loans; and




          h. Either (1) the Assignee is not an employee benefit plan (“Plan”) within the meaning of
section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) or a plan
(also “Plan”) within the meaning of section 4975(e)(1) of the Internal Revenue Code of 1986
(“Code”), and the Assignee is not directly or indirectly purchasing the Mortgage Loans on behalf
of, investment manager of, as named fiduciary of, as Trustee of, or with assets of, a Plan; or (2)
the Assignee’s purchase of the Mortgage Loans will not result in a prohibited transaction under
section 406 of ERISA or section 4975 of the Code.




          i. The Assignee’s address for purposes of all notices and correspondence related to the
Mortgage Loans and the Seller’s Warranties and Servicing Agreements is:




 









 








	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Attention:	 	 	 	 
	 

	 	 	 	 	 	 





     The Assignee’s wire transfer instructions for purposes of all remittances and payments related
to the Mortgage Loans and the Seller’s Warranties and Servicing Agreement is:



	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Attention:	 	 	 	 
	 

	 	 	 	 	 	 






     4. From and after the date hereof, the Company shall note the transfer of the Mortgage Loans
to the Assignee in its books and records, the Company shall recognize the Assignee as the owner of
the Mortgage Loans and the Company shall service the Mortgage Loans for the benefit of the Assignee
pursuant to the Seller’s Warranties and Servicing Agreement, the terms of which are incorporated
herein by reference. It is the intention of the Assignor, the Company and the Assignee that the
Seller’s Warranties and Servicing Agreement shall be binding upon and inure to the benefit of the
Company and the Assignee and their respective successors and assigns.



[Signatures Follow]




 









 





     IN WITNESS WHEREOF, the parties have caused this Assignment and Assumption to be executed by their duly authorized officers as of the date first above written.



	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	Assignor	 	 	 	Assignee	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	Name:

	 	 	 	 	 	Name:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	Its:

	 	 	 	 	 	Its:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	Tax Payer Identification No.:	 	 	 	Tax Payer Identification No.: