Document:

EX-10.1

Exhibit 10.1

MASTER LOAN AND SECURITY AGREEMENT

MASTER LOAN AND SECURITY AGREEMENT, dated as of November 15, 2005 (as amended, restated,
supplemented or otherwise modified and in effect from time to time, this “Loan Agreement”),
by and among NC CAPITAL CORPORATION, a California corporation (“NC Capital”), NEW CENTURY
MORTGAGE CORPORATION, a California corporation (“New Century”), NC RESIDUAL II CORPORATION,
a Delaware corporation (“NC Residual”), NEW CENTURY CREDIT CORPORATION, a California
corporation (“NC Credit”, together with NC Capital, New Century and NC Residual,
collectively, the “Borrowers”, each, a “Borrower”), and MORGAN STANLEY MORTGAGE
CAPITAL INC., a New York corporation, as a Lender and agent for the Lender (in such capacity, the
“Agent”).

RECITALS

The Borrowers have requested that the Lender from time to time make revolving credit loans to
the Borrowers finance certain residential mortgage loans owned by the Borrowers and the Lender is
prepared to make such loans upon the terms and subject to the conditions of this Loan Agreement.

NOW, THEREFORE, the Borrowers, the Lender and the Agent hereby agree, in consideration of the
mutual premises and mutual obligations set forth herein, the receipt and sufficiency of which is
hereby acknowledged, as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING MATTERS.

Section 1.01 Certain Defined Terms. As used herein, the following terms shall have
the following meanings (all terms defined in this Section 1.1 or in other provisions of this Loan
Agreement in the singular to have the same meanings when used in the plural and vice versa):

“Affiliate” shall mean with respect to any Person, any “affiliate” of such Person, as
such term is defined in the Bankruptcy Code.

“Agent” shall have the meaning provided in the introductory paragraph hereof.

“Alternate ‘A’ Mortgage Loan” shall mean an Eligible Mortgage Loan having an LTV that
is not greater than 95%, having a minimum FICO Score of 660 and satisfying New Century’s
Underwriting Guidelines applicable to “Alternate ‘A’ Mortgage Loans”.

“Applicable Collateral Percentage” shall mean, except as may be reduced pursuant to
Section 11.15 hereof, for any date of determination and each type of Eligible Mortgage Loan, the
applicable collateral percentage specified in the table below:

	 	 	 	 	 
	Type of Eligible Mortgage Loan
	 	Applicable Collateral Percentage

	 
	 	 	 	 
	Unseasoned Mortgage Loan
	 	 	98	%
	Second Lien Mortgage Loan
	 	 	98	%
	30+ Delinquent Mortgage Loan
	 	 	85	%
	60+ Delinquent Mortgage Loan
	 	 	75	%
	Wet-Ink Mortgage Loan
	 	 	98	%
	Defaulted Mortgage Loan
	 	the applicable BPO Percentage

	Discretionary Mortgage Loan
	 	the applicable percentage

	 
	 	specified by the Agent one (1)

	 
	 	Business Day prior to the

	 
	 	applicable Funding Date

“Applicable Loan Rate” shall mean the Eurodollar Loan Rate in effect from time to
time, unless an event set forth in Section 2.05 shall occur, in which case the Applicable Loan Rate
from and after the date of such event shall mean the Federal Loan Rate.

“Applicable Margin” shall mean the sum of the weighted average of the applicable rates
per annum for each type of Eligible Mortgage Loan for each day that Loans shall be secured by such
Eligible Mortgage Loans. For each type of Eligible Mortgage Loan, the applicable rate shall be
equal to the product of (x) a fraction equal to (1) the Collateral Value of all Eligible Mortgage
Loans of such type, divided by (2) the Collateral Value of all Eligible Mortgage Loans, and (y) the
applicable margin specified in the table below:

	 	 	 	 	 
	Type of Eligible Mortgage Loan
	 	Applicable Margin

	 
	 	 	 	 
	Unseasoned Mortgage Loan
	 	 	0.50	%
	Second Lien Mortgage Loan
	 	 	0.50	%
	30+ Delinquent Mortgage Loan
	 	 	1.00	%
	60+ Delinquent Mortgage Loan
	 	 	1.00	%
	Defaulted Mortgage Loan
	 	 	1.45	%
	Wet-Ink Mortgage Loan
	 	 	0.50	%
	Discretionary Mortgage Loan
	 	the applicable percentage

	 
	 	specified by the Agent one (1)

	 
	 	Business Day prior to the

	 
	 	applicable Funding Date

“Approved Escrow Holdback” shall be the total amount which was included in the sales
price and appraised value of an Escrow Eligible Property with respect to Specific Eligible Upgrades
that were not completed as of the origination of the related Mortgage Loan and which amount is held
in escrow by the related title or closing agent in accordance with the Underwriting Guidelines to
secure the completion of such Specific Eligible Upgrades.

“Bankruptcy Code” shall mean the United States Bankruptcy Code, 11 U.S.C. § 101 et.
seq., as amended from time to time.

“Board Report” shall mean the documentation delivered to the Board of Directors of the
Guarantor pursuant to Section 7.01(b), which shall include, but is not limited to (i) financial
overview, (ii) consolidated financial statements and (iii) any additional financial information
included in such report from time to time.

“Borrower” and “Borrowers” shall have the meanings provided in the heading
hereof.

“Borrowing Base” shall mean the aggregate Collateral Value of all Eligible Mortgage
Loans.

“Borrowing Base Deficiency” shall have the meaning provided in Section 2.07 hereof.

“BPO Percentage” shall mean (i) with respect to any Defaulted Mortgage Loan for which
a Broker Price Opinion has not been obtained, 50% and (ii) with respect to any Defaulted Mortgage
Loan for which a Broker Price Opinion has been obtained, 65%.

“Broker Price Opinion” shall mean, with respect to a Mortgage Loan or an REO Property,
a broker’s price opinion prepared by a duly licensed real estate broker who has no interest, direct
or indirect, in the Mortgage Loan or REO Property or in the Borrowers or any Affiliate of the
Borrowers and whose compensation is not affected by the results of the broker’s price opinion, and
which valuation (i) indicates the expected proceeds for a sale of the related Mortgaged Property or
REO Property and, (ii) with respect to any condominium development or planned unit development that
was not Federal National Mortgage Association or Federal Home Loan Mortgage Corporation approved,
the amount, if any, by which the valuation was decreased as a result of such lack of approval, and
(iii) includes certain assumptions, including those as to the condition of the exterior and
interior of the applicable Mortgaged Property or REO property and carrying costs and expenses
during marketing time.

“Business Day” shall mean any day other than (i) a Saturday or Sunday or (ii) a day on
which the New York Stock Exchange, the Federal Reserve Bank of New York or the Custodian is
authorized or obligated by law or executive order to be closed.

“Capital Lease Obligations” shall mean, for any Person, all obligations of such Person
to pay rent or other amounts under a lease of (or other agreement conveying the right to use)
Property to the extent such obligations are required to be classified and accounted for as a
capital lease on a balance sheet of such Person under GAAP, and, for purposes of this Loan
Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP.

“Capital Stock” shall mean any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all similar ownership
interests in a Person (other than a corporation) and any and all warrants or options to purchase
any of the foregoing.

“Closing Agent” shall mean, with respect to any Loan, the entity reasonably
satisfactory to the Agent (which may be a title company, escrow company or attorney in accordance
with local law and practice in the jurisdiction where the related Wet-Ink Mortgage Loan is being
originated) to which the proceeds of such Loan are to be wired pursuant to the instructions of the
Borrowers.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

“Collateral” shall have the meaning provided in Section 4.01(b) hereof.

“Collateral Value” shall mean, with respect to each Eligible Mortgage Loan, the lesser
of (x) the product of (i) the Market Value of such Eligible Mortgage Loan, and (ii) the Applicable
Collateral Percentage for such Eligible Mortgage Loan, and (y) 100% of the unpaid principal balance
of such Eligible Mortgage Loan; provided,

(a) that the following additional limitations shall apply:

(i) the aggregate unpaid principal balance of Mortgage Loans secured by a first
mortgage lien on the Mortgaged Property that has a LTV greater than 85% shall not
exceed $180,000,000;

(ii) the aggregate unpaid principal balance of the Mortgage Loans that are
secured by Mortgaged Properties which are non-owner occupied shall at no time exceed
6% of the Maximum Credit;

(iii) the aggregate unpaid principal balance of the Second Lien Mortgage Loans
shall at no time exceed 8.5% of the Maximum Credit;

(iv) the aggregate unpaid principal balance of the Mortgage Loans that are
secured by Mortgaged Properties consisting of condominiums shall at no time exceed
6% of the Maximum Credit;

(v) the aggregate unpaid principal balance of the Mortgage Loans that are
secured by Mortgaged Properties consisting of Qualified Manufactured Housing (as
defined in Part III of Schedule 1 hereto) shall at no time exceed 2% of the
Maximum Credit;

(vi) the aggregate unpaid principal balance of Mortgage Loans secured by
Mortgaged Property located within a single zip code shall not exceed $60,000,000;

(vii) the aggregate unpaid principal balance of the 30+ Delinquent Mortgage
Loans shall at no time exceed 2% of the Maximum Credit;

(viii) the aggregate unpaid principal balance of the 60+ Delinquent Mortgage
Loans shall at no time exceed 1% of the Maximum Credit;

(ix) the aggregate unpaid principal balance of the Mortgage Loans with respect
to which the related Mortgagor has received a credit rating of “C” or “C-”, as
determined in accordance with New Century’s Underwriting Guidelines, shall not
exceed $40,000,000;

(x) the aggregate unpaid principal balance of the HELOC Mortgage Loans shall at
no time exceed 7% of the Maximum Credit;

(xi) the aggregate unpaid principal balance of the Defaulted Mortgage Loans
shall not exceed $4,000,000;

(xii) the aggregate unpaid principal balance of the Discretionary Mortgage
Loans shall not exceed 10% of the Maximum Credit;

(xiii) the aggregate unpaid principal balance of the Wet-Ink Mortgage Loans
included shall not exceed $40,000,000;

(xiv) the aggregate unpaid principal balance of all Mortgage Loans secured by a
first mortgage lien on a Mortgaged Property that has an LTV greater than 95% and
equal to or less than 100% shall at no time exceed 3% of the Maximum Credit; and

(xv) the aggregate unpaid principal balance of all Escrow Holdback Loans shall not exceed
$10,000,000; and

(b) that the Collateral Value shall be deemed to be zero with respect to each Mortgage
Loan:

(i) in respect of which there is a breach of any representation or warranty set
forth on Schedule 1 hereto (assuming each representation and warranty is
made as of the date the Collateral Value thereof is determined);

(ii) which ceases to be an Eligible Mortgage Loan for any reason;

(iii) which is a Nine-Day Aged Wet-Ink Mortgage Loan;

(iv) with respect to each Mortgage Loan, for so long as such Mortgage Loan is a
Wet-Ink Mortgage Loan, as to which the Agent or the Custodian shall have notified
the Borrowers that the Custodian shall have transferred an amount greater than
$1,000,000 to a single settlement location on a Funding Date, unless consented to by
the Agent;

(v) for which any Mortgage Loan Documents have been released from the
possession of the Custodian under the Custodial Agreement for a period in excess of
15 days;

(vi) which is secured by a first mortgage lien on a Mortgaged Property that has
an LTV greater than 95% and equal to or less than 100% and has a FICO score less
than 600;

(vii) which has been pledged to the Agent under the Loan Agreement in excess of
180 calendar days;

(viii) which exceeds any limitation set forth in clause (a) above.

“Collection Account” shall mean one or more accounts established by the Servicer
subject to a security interest in favor of the Agent, for the benefit of the Lender, into which all
Collections shall be deposited by the Servicer.

“Collections” shall mean, collectively, all collections and proceeds on, or in respect
of the Mortgage Loans, excluding collections required to be paid to the Servicer or a mortgagor on
the Mortgage Loans.

“Commitment” shall mean, as to the Lender, the obligation of the Lender to make Loans
to the Borrowers pursuant to Section 2.01 hereunder in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite the Lender’s name on Schedule
4 under the caption “Commitment” or in an Assignment and Acceptance, as such amount may be
reduced from time to time in accordance with the provisions of this Loan Agreement. The aggregate
Commitments of the Lender shall equal the Maximum Credit.

“Commitment Percentage” shall mean as to the Lender at any time, the percentage which
the Lender’s Commitment then constitutes of the aggregate Commitments (or, at any time after the
Commitments shall have expired or terminated, the percentage which the aggregate principal amount
of the Lender’s Loans then outstanding constitutes of the aggregate principal amount of the Loans
then outstanding).

“Control Agreement” shall mean an Account Control Agreement, substantially in the form
of Exhibit J hereto, executed and delivered by a duly authorized officer of each of the
parties thereto, as the same may be amended, restated, supplemented or otherwise modified and in
effect from time to time.

“Controlled Accounts” shall mean collectively, the Collection Account and the Wet
Funding Account.

“Credit Exposure” shall mean, as to the Lender at any time, its Commitment (or, if the
Commitments shall have expired or been terminated, the aggregate unpaid principal amount of its
Loans).

“Credit Exposure Percentage” shall mean, as to the Lender at any time, the fraction
(expressed as a percentage), the numerator of which is the Credit Exposure of the Lender at such
time and the denominator of which is the aggregate Credit Exposures of the Lender at such time.

“Custodial Agreement” shall mean a Custodial Agreement, substantially in the form of
Exhibit B hereto, executed and delivered by a duly authorized officer of each of the
parties thereto, as the same may be amended, restated, supplemented or otherwise modified and in
effect from time to time.

“Custodian” shall mean Deutsche Bank National Trust Company, as custodian under the
Custodial Agreement, and its successors and permitted assigns thereunder.

“Default” shall mean an Event of Default or an event that with notice or lapse of time
or both would become an Event of Default.

“Defaulted Mortgage Loan” shall mean, as of any date of determination, an Eligible
Mortgage Loan which is 90 days or more Delinquent and/or is subject to a foreclosure proceeding.

“Delinquent” shall mean that a Monthly Payment (as defined in Part III of Schedule
1 hereto) has not been made by the close of business on the related Due Date (as defined in
Part III of Schedule 1 hereto).

“Disbursement Agent” shall mean Deutsche Bank National Trust Company, as disbursement
agent for the Agent pursuant to the Custodial Agreement.

“Discretionary Mortgage Loan” shall mean a Mortgage Loan which does not specifically
meet the parameters of an Eligible Mortgage Loan as described herein.

“Dollars” and “$” shall mean lawful money of the United States of America.

“Due Diligence Review” shall mean the performance by the Agent of any or all of the
reviews permitted under Section 11.15 hereof with respect to any or all of the Mortgage Loans, as
desired by the Agent from time to time.

“Effective Date” shall mean the date upon which the conditions precedent set forth in
Section 5.01 shall have been satisfied.

“Eligible Mortgage Loan” shall mean a Mortgage Loan originated by any Borrower or any
Affiliate of any Borrower, secured by a first or second mortgage Lien on a one-to-four family
residential property, as to which the representations, and warranties in Section 6.10 and Part I
and Part II of Schedule 1 hereof are correct; provided, however, that, in no event
shall any Eligible Mortgage Loan be a security for purposes of any securities or blue-sky laws; and
provided, further, that the following Mortgage Loans shall not be an Eligible
Mortgage Loan: (1) a Mortgage Loan for which the related obligor is subject to a voluntary or
involuntary bankruptcy proceeding or for which the related Mortgaged Property has been acquired
through foreclosure, acceptance of a deed-in-lieu of foreclosure or otherwise in accordance with
applicable law in connection with the default of such Mortgage Loan, (2) a Defaulted Mortgage Loan
for which a Broker Price Opinion can not be obtained, (3) a Mortgage Loan that is listed on the
Exception Report, and (4) a Mortgage Loan which shall have been pledged to the Agent, for the
benefit of the Lender hereunder, for more than 180 days.

“Equity Proceeds” shall mean with respect to the Guarantor, an amount equal to the net
proceeds from the issuance of any securities of the Guarantor or the net proceeds to the Guarantor
from contributions to capital or otherwise by another Person.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“ERISA Affiliate” shall mean any corporation or trade or business that is a member of
any group of organizations (i) described in Section 414(b) or (c) of the Code of which any Borrower
is a member and (ii) solely for purposes of potential liability under Section 302(c)(11) of ERISA
and Section 412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and Section
412(n) of the Code, described in Section 414(m) or (o) of the Code of which any Borrower is a
member.

“Escrow Eligible Property” shall mean a newly constructed Mortgaged Property that (i)
is habitable, (ii) was constructed and is being completed by a builder that is an approved builder
under the Underwriting Guidelines, (iii) is a single family residence or a detached unit in a
planned unit development (PUD), (iv) is not a condominium, (v) is owner-occupied and (vi) is not
subject to any HELOC Mortgage Loan.

“Escrow Holdback Loan” shall mean a Mortgage Loan that was made in connection with the
initial retail sale of an Escrow Eligible Property and which is subject to an Approved Escrow
Holdback.

“Eurodollar Loan Rate” shall mean a rate per annum equal to the sum of the Eurodollar
Rate plus the Applicable Margin.

“Eurodollar Rate” shall mean, with respect to each day a Loan is outstanding, the rate
per annum based on the rate appearing at page 5 of the Telerate Screen as one-month LIBOR on such
date (and if such date is not a Business Day, the Eurodollar Rate in effect on the Business Day
immediately preceding such date), and if such rate shall not be so quoted, the rate per annum at
which a money-center bank designated by the Agent is offered Dollar deposits at or about 10:00
A.M., New York City time, on such date by prime banks in the interbank eurodollar market where the
eurodollar and foreign currency exchange operations in respect of its Loans are then being
conducted for delivery on such day for a period of 30 days and in an amount comparable to the
amount of the Loans to be outstanding on such day.

“Exception” shall have the meaning specified in the Custodial Agreement.

“Exception Report” shall mean the portion of the Mortgage Loan Schedule and Exception
Report detailing Exceptions in respect of each Mortgage Loan.

“Excess Proceeds” shall have the meaning provided in Section 2.07(d) hereof.

“Expense Claims” shall have the meaning provided in Section 11.22 hereof.

“Event of Default” shall have the meaning provided in Article VIII hereof.

“Federal Funds Rate” shall mean, for any day, the weighted average of the rates on
overnight federal funds transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New
York, or, if such rate is not so published for any day which is a Business Day, the average of the
quotations for the day of such transactions received by a money-center bank designated by the Agent
from three federal funds brokers of recognized standing selected by it.

“Federal Loan Rate” shall mean a rate per annum equal to the sum of (x) the Federal
Funds Rate plus 1.00% and (y) the Applicable Margin.

“Funding Date” shall mean the date on which a Loan is made hereunder.

“GAAP” shall mean generally accepted accounting principles as in effect from time to
time in the United States.

“Governmental Authority” shall mean any nation or government, any state or other
political subdivision thereof, any entity exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government and any court or arbitrator having
jurisdiction over any Borrower or any of their Affiliates or Property.

“Guarantee” shall mean, as to any Person, any obligation of such Person directly or
indirectly guaranteeing any Indebtedness of any other Person or in any manner providing for the
payment of any Indebtedness of any other Person or otherwise protecting the holder of such
Indebtedness against loss (whether by virtue of partnership arrangements, by agreement to keep
well, to purchase assets, goods, securities or services, or to take-or-pay or otherwise);
provided, that the term “Guarantee” shall not include (i) endorsements for collection or
deposit in the ordinary course of business or (ii) obligations to make servicing advances for
delinquent taxes and insurance or other obligations in respect of a Mortgaged Property. The amount
of any Guarantee of a Person shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as determined by such
Person in good faith. The terms “Guarantee” and “Guaranteed” used as verbs shall have correlative
meanings.

“Guarantor” shall mean New Century Financial Corporation, a Maryland corporation.

“HELOC Mortgage Loan” shall mean a revolving line of credit that is a first or second
lien Mortgage Loan made by any Borrower to a Mortgagor, which is underwritten substantially in
accordance with the Underwriting Guidelines for Mortgage Loans that are home equity lines of
credit.

“Indebtedness” shall mean, for any Person: (a) obligations created, issued or incurred
by such Person for borrowed money (whether by loan, the issuance and sale of debt securities or the
sale of Property to another Person subject to an understanding or agreement, contingent or
otherwise, to repurchase such Property from such Person); (b) obligations of such Person to pay the
deferred purchase or acquisition price of Property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses incurred, in the ordinary course of
business so long as such trade accounts payable are payable within 90 days of the date the
respective goods are delivered or the respective services are rendered; (c) Indebtedness of others
secured by a Lien on the Property of such Person, whether or not the respective Indebtedness so
secured has been assumed by such Person; (d) obligations (contingent or otherwise) of such Person
in respect of letters of credit or similar instruments issued or accepted by banks and other
financial institutions for account of such Person; (e) Capital Lease Obligations of such Person;
(f) obligations of such Person under repurchase agreements, sale/buy-back agreements or like
arrangements; (g) Indebtedness of others Guaranteed by such Person; (h) all obligations of such
Person incurred in connection with the acquisition or carrying of fixed assets by such Person; and
(i) Indebtedness of general partnerships of which such Person is a general partner.

“Initial Servicer” shall have the meaning provided in Section 11.14(a) hereof.

“Intangible Assets” shall mean the excess of the cost over book value of assets
acquired, patents, trademarks, copyrights, franchises and other intangible assets (excluding, in
any event, the value of any residual securities and the value of any owned or purchased mortgage
servicing rights).

“Interest Rate Protection Agreement” shall mean, with respect to any or all of the
Mortgage Loans, any short sale of US Treasury Securities, futures contract, mortgage related
security, Eurodollar futures contract, options related contract, interest rate swap, cap or collar
agreement or similar arrangement providing for protection against fluctuations in interest rates or
the exchange of nominal interest obligations, either generally or under specific contingencies,
entered into by a Borrower and an Affiliate of the Agent, and acceptable to the Lender.

“Lender” shall have the meaning provided in the heading hereto.

“Lien” shall mean any mortgage, lien, pledge, charge, security interest or similar
encumbrance.

“Loan” shall have the meaning provided in Section 2.01(a) hereof.

“Loan Agreement” shall have the meaning provided in the heading hereto.

“Loan Documents” shall mean, collectively, this Loan Agreement, each Note, the
Custodial Agreement, the Control Agreement and the New Century Guaranty.

“Loan-to-Value Ratio” or “LTV” shall mean with respect to any Mortgage Loan,
the ratio of the original outstanding principal amount of such Mortgage Loan to the lesser of (a)
the appraised Value of the related Mortgaged Property at the time of origination and (b) if the
related Mortgaged Property was purchased within 12 months of the origination of the Mortgage Loan,
the purchase price of the Mortgaged Property.

“Market Value” shall mean, as of any date in respect of an Eligible Mortgage Loan, the
value determined by the Agent in good faith and in its sole discretion.

“Material Adverse Effect” shall mean a material adverse effect on (a) the Property,
business, operations, financial condition or prospects of any Borrower or any of its Material
Affiliates, (b) the ability of any Borrower or any of its Material Affiliates to perform its
obligations under any of the Loan Documents to which it is a party, (c) the validity or
enforceability of any of the Loan Documents, (d) the rights and remedies of the Agent or the Lender
under any of the Loan Documents, (e) the timely payment of the principal of or interest on the
Loans or other amounts payable in connection therewith or (f) the Collateral as a whole.

“Material Affiliate” shall mean New Century Financial Corporation and its successors
and assigns.

“Maximum Credit” shall mean, at any time, an amount equal to $400,000,000, as such
amount may be reduced in accordance with Section 2.01 hereof.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Mortgage” shall mean the mortgage, deed of trust or other instrument securing a
Mortgage Note, which creates a first or second Lien on the fee in real property securing the
Mortgage Note.

“Mortgage File” shall have the meaning assigned thereto in the Custodial Agreement.

“Mortgage Loan” shall mean a mortgage loan which the Custodian has been instructed to
hold for the Agent on behalf of the Lender pursuant to the Custodial Agreement, and which Mortgage
Loan includes, without limitation, a Mortgage Note and related Mortgage.

“Mortgage Loan Data File” shall mean a computer-readable file containing information
with respect to each Mortgage Loan, to be delivered by any Borrower to the Agent pursuant to
Section 2.03(a) hereof which fields are identified on Annex I to the Custodial Agreement.

“Mortgage Loan Documents” shall mean, with respect to a Mortgage Loan, the documents
comprising the Mortgage File for such Mortgage Loan.

“Mortgage Loan Schedule” shall have the meaning assigned thereto in the Custodial
Agreement.

“Mortgage Loan Schedule and Exception Report” shall mean the mortgage loan schedule
and exception report prepared by the Custodian pursuant to the Custodial Agreement.

“Mortgage Note” shall mean the original executed promissory note or other evidence of
the indebtedness of a mortgagor/borrower with respect to a Mortgage Loan.

“Mortgaged Property” shall mean the real property (including all improvements,
buildings, fixtures, building equipment and personal property thereon and all additions,
alterations and replacements made at any time with respect to the foregoing) and all other
collateral securing repayment of the debt evidenced by a Mortgage Note.

“Mortgagor” shall mean the obligor on a Mortgage Note.

“MS & Co.” shall mean Morgan Stanley & Co. Incorporated, a registered broker-dealer.

“MS Indebtedness” shall mean any indebtedness of a Borrower hereunder and under any
other arrangement (other than this Loan Agreement) between a Borrower on the one hand and the
Lender (or any Affiliate of the Lender) on the other hand (including, without limitation, any
Loans, interest due and default interest, termination payments, hedging costs, structuring or other
facility fees and expenses).

“Multiemployer Plan” shall mean a multiemployer plan defined as such in Section 3(37)
of ERISA to which contributions have been or are required to be made by any Borrower or any ERISA
Affiliate and that is covered by Title IV of ERISA.

“Net Income” shall mean, for any period, the net income of the Guarantor for such
period as determined in accordance with GAAP.

“New Century Guaranty” shall mean the Guaranty, made by the Guarantor, substantially
in the form of Exhibit H hereto, as the same may be amended, restated, supplemented or
otherwise modified and in effect from time to time.

“Nine-Day Aged Wet-Ink Mortgage Loan” shall mean a Wet-Ink Mortgage Loan with respect
to which the related Mortgage File has not been received by the Custodian and the Custodian has not
issued a Trust Receipt by the ninth (9th) Business Day following the applicable Funding
Date.

“1934 Act” shall mean the Securities and Exchange Act of 1934, as amended.

“Note” shall have the meaning provided in Section 2.02(a) hereof.

“PBGC” shall mean the Pension Benefit Guaranty Corporation or any entity succeeding to
any or all of its functions under ERISA.

“Person” shall mean any individual, corporation, company, voluntary association,
partnership, joint venture, limited liability company, trust, unincorporated association or
government (or any agency, instrumentality or political subdivision thereof).

“Plan” shall mean an employee benefit or other plan established or maintained by any
Borrower or any ERISA Affiliate and covered by Title IV of ERISA, other than a Multiemployer Plan.

“Post-Default Rate” shall mean, in respect of any principal of any Loan or any other
amount under this Loan Agreement, the Notes or any other Loan Document that is not paid when due to
the Lender or the Agent (whether at stated maturity, by acceleration, by optional or mandatory
prepayment or otherwise), a rate per annum during the period from and including the due date to but
excluding the date on which such amount is paid in full equal to 4% per annum plus the Prime Rate
in effect on such due date and from time to time thereafter until such amount is paid in full.

“Predatory Lending Practices” means any and all underwriting and lending policies,
procedures and practices defined or enumerated in any local or municipal ordinance or regulation or
any state or federal regulation or statute prohibiting, limiting or otherwise relating to the
protection of consumers from such policies, procedures and practices. Such policies, practices and
procedures may include, without limitation, charging excessive loan, broker, and closing fees,
charging excessive rates of loan interest, making loans without regard to a consumer’s ability to
re-pay the loan, refinancing loans with no material benefit to the consumer, charging fees for
services not actually performed, discriminating against consumers on the basis of race, gender, or
age, failing to make proper disclosures to the consumer of the consumer’s rights under federal and
state law, and any other predatory lending policy, practice or procedure as defined by ordinance,
regulation or statute.

“Prescribed Laws” shall mean, collectively, (a) the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law
107-56) (The USA PATRIOT Act), (b) Executive Order No. 13224 on Terrorist Financing, effective
September 24, 2001, and relating to Blocking Property and Prohibiting Transactions With Persons Who
Commit, Threaten to Commit, or Support Terrorism, (c) the International Emergency Economic Power
Act, 50 U.S.C. §1701 et. seq. and (d) all other Requirements of Law relating to money laundering or
terrorism.

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

“Property” shall mean any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible.

“Purchase Advice” shall have the meaning provided in Section 2.07(d) hereof.

“Purchase Advice Deficiency” shall have the meaning provided in Section 2.07(d)
hereof.

“Regulations T, U and X” shall mean Regulations T, U and X of the Board of Governors
of the Federal Reserve System (or any successor), as the same may be modified and supplemented and
in effect from time to time.

“REIT Borrower” shall mean any Borrower which has REIT Status as of the Effective
Date.

“REIT Distribution Requirement” shall mean distributions reasonably necessary for each
REIT Borrower to maintain its REIT Status and not be subject to corporate level tax based on income
or to excise tax under Section 4981 of the Code.

“REIT Status” shall mean with respect to any Person, such Person’s status as a real
estate investment trust, as defined in Section 856(a) of the Code, that satisfies the conditions
and limitations set forth in Section 856(b) and 856(c) of the Code.

“Remittance Amount” shall have the meaning provided in Section 2.07(d) hereof.

“Remittance Date” shall mean the 5th Business Day of each month. For purposes of this
definition, “Business Day” shall mean any day other than (a) a Saturday or Sunday or (b) a day on
which banking and savings and loan institutions in the States of Florida and California are
authorized or obligated by law or executive order to be closed.

“Responsible Officer” shall mean, as to any Person, the chief executive officer or,
with respect to financial matters, the chief financial officer of such Person.

“Requirement of Law” shall mean as to any Person, the certificate of incorporation and
by-laws or other organizational or governing documents of such Person, and any law (including,
without limitation, Prescribed Laws), treaty, rule or regulation or determination of an arbitrator
or a court or other Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is subject.

“S&P” shall mean Standard and Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc.

“Second Lien Mortgage Loan” shall mean an Eligible Mortgage Loan which is secured by a
second Lien on the related Mortgaged Property.

“Secured Obligations” shall have the meaning provided in Section 4.01(c) hereof.

“Servicer” shall mean the Initial Servicer or a Third Party Servicer, as the context
requires.

“Servicer Notice” shall have the meaning provided in Section 11.14(c) hereof.

“Servicing Agreement” shall have the meaning provided in Section 11.14(c) hereof.

“Servicing Records” shall have the meaning provided in Section 11.14(b) hereof.

“60+ Delinquent Mortgage Loan” shall mean, as of any date of determination, an
Eligible Mortgage Loan which is between 60 days and 89 days (inclusive) Delinquent.

“Specific Eligible Upgrades” shall mean certain upgrades to an Escrow Eligible
Property, including interior upgrades (such as carpet/floor coverings, crown molding, cabinets and
shutters), landscaping (such as sod, shrubs, irrigation and fencing), hardscaping (such as concrete
patios, walkways, driveways, and swimming pools) and such other upgrades as the Lender shall deem
acceptable in its sole discretion, but excluding, in any event, (a) anything which if not completed
or completed improperly could adversely affect the habitability of the Mortgaged Property,
including, without limitation, heating, cooling, water, sewer, electricity, etc., and (b) any
upgrade which is not completed (i) solely with respect to any weather dependent exterior upgrade,
within ninety (90) calendar days after origination of the related Mortgage Loan and (ii) with
respect to all other upgrades, including all interior and non-weather dependent exterior upgrades,
within thirty (30) calendar days after origination of the related Mortgage Loan.

“Subsidiary” shall mean, with respect to any Person, any corporation, partnership or
other entity of which at least a majority of the securities or other ownership interests having by
the terms thereof ordinary voting power to elect a majority of the board of directors or other
persons performing similar functions of such corporation, partnership or other entity (irrespective
of whether or not at the time securities or other ownership interests of any other class or classes
of such corporation, partnership or other entity shall have or might have voting power by reason of
the happening of any contingency) is at the time directly or indirectly owned or controlled by such
Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.

“System” shall mean all hardware or software, or any system consisting of one or more
thereof, including, without limitation, any and all enhancements, upgrades, customizations,
modifications and the like utilized by any Person for the benefit of such Person to perform its
obligations and to administer and track, store, process, provide, and where appropriate, insert,
true and accurate dates and calculations for dates and time spans with respect to the Mortgage
Loans.

“Takeout Commitment” shall mean a trade confirmation from a Takeout Investor to the
Borrowers confirming the details of a forward trade between the Takeout Investor (as buyer) and the
Borrowers (as seller) constituting a valid, binding and enforceable mandatory delivery commitment
by such Takeout Investor to purchase on or before a specified date, and at a given Takeout Price,
the Mortgage Loans described therein.

“Takeout Investor” shall mean a securities broker-dealer or other institution,
acceptable to the Agent, which has made a Takeout Commitment.

“Takeout Price” shall mean as to each Takeout Commitment the purchase price (expressed
as a percentage of par) set forth therein.

“Takeout Proceeds” shall mean as to each Mortgage Loan pledged to the Agent for the
benefit of the Lender hereunder which is subject to a Takeout Commitment, the actual amount of
proceeds delivered to the Agent pursuant to Section 2.07(d) by the applicable Takeout Investor for
the purchase of such Mortgage Loans.

“Takeout Proceeds Identification Letter” shall mean a takeout proceeds identification
letter, substantially in the form of Exhibit K hereto.

“Tangible Net Worth” shall mean, as of any date of determination, all amounts which
would be included under capital on a balance sheet of the Guarantor at such date, determined in
accordance with GAAP, less (i) amounts owing to the Guarantor from Affiliates and (ii) Intangible
Assets.

“Tangible Net Worth Trigger Event” shall have occurred (based on the Borrowers’ most
recent monthly financials) if the Tangible Net Worth of the Guarantor is less than the sum of (i)
$750,000,000 and (ii) an amount equal to 50% of any Equity Proceeds received by the Guarantor from
and after March 31, 2005.

“Termination Date” shall mean December 31, 2005, as such date may be extended in
accordance with Section 2.08 hereof, or such earlier date on which this Loan Agreement shall
terminate in accordance with the provisions hereof or by operation of law.

“Third Party Servicer” shall have the meaning provided in Section 11.14(c) hereof.

“30+ Delinquent Mortgage Loan” shall mean, as of any date of determination, an
Eligible Mortgage Loan which is between 30 days and 59 days (inclusive) Delinquent.

“Total Indebtedness” shall mean, for any period, the aggregate Indebtedness of the
Guarantor during such period maintained in accordance with GAAP less the aggregate amount of any
such Indebtedness that is reflected on the balance sheet of the Guarantor in respect of obligations
incurred pursuant to a securitization transaction, solely to the extent such obligations are
secured by the assets securitized thereby and are non-recourse to the Guarantor. In the event that
any Indebtedness would be excluded from the calculation of Total Indebtedness but for the existence
of recourse, the Guarantor shall be entitled nonetheless to exclude the amount of such Indebtedness
that is not subject to recourse. The amount of any recourse shall be the stated or determinable
amount thereof or, if not stated or determinable, the maximum reasonably anticipated liability in
respect thereof as determined by the Guarantor in good faith.

“Trust Receipt” shall have the meaning assigned thereto in the Custodial Agreement.

“Underwriting Guidelines” shall mean the underwriting guidelines attached as
Exhibit F hereto, as the same may be revised from time to time in accordance with the terms
hereof.

“Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect from
time to time in the State of New York; provided, that if by reason of mandatory provisions of law,
the perfection or the effect of perfection or non-perfection of the security interest or the
renewal or enforcement thereof in any Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than New York, “Uniform Commercial Code” shall mean the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof
relating to such perfection or effect of perfection or non-perfection.

“Unseasoned Mortgage Loan” shall mean, as of any date of determination, an Eligible
Mortgage Loan (provided, that notwithstanding the definition of the term “Eligible Mortgage Loan,”
an Unseasoned Mortgage Loan must have a first Lien status with respect to the related Mortgaged
Property) which has been originated 120 days or less prior to the related Funding Date.

“Wet-Ink Mortgage Loan” shall mean a Mortgage Loan originated by any Borrower in a
transaction table-funded by the Lender, which origination or table funding is financed in part or
in whole with proceeds of Loans and as to which the Custodian has not yet received the related
Mortgage File. A Mortgage Loan shall cease to be a Wet-Ink Mortgage Loan on the date on which the
Agent has received a Mortgage Loan Schedule and Exception Report from the Custodian with respect to
such Mortgage Loan confirming that the Custodian has physical possession of the related Mortgage
File and that there are no Exceptions (as defined in the Custodial Agreement) with respect to such
Mortgage Loan.

“Wet-Ink Transaction” shall mean a borrowing in connection with which Wet-Ink Mortgage
Loans are included in the Borrowing Base. A Wet-Ink Transaction shall cease to be a Wet-Ink
Transaction on the date that the underlying Wet-Ink Mortgage Loan ceases to be a Wet-Ink Mortgage
Loan (in accordance with the definition thereof).

“Wet-Ink Aged Report” shall have the meaning specified in Section 3(a) of the
Custodial Agreement.

“Wet Funding Account” shall have the meaning specified in Section 4(i) of the
Custodial Agreement.

Section 1.02 Accounting Terms and Determinations. Except as otherwise expressly
provided herein, all accounting terms used herein shall be interpreted, and all financial
statements and certificates and reports as to financial matters required to be delivered to the
Agent hereunder shall be prepared, in accordance with GAAP.

ARTICLE II

LOANS, NOTE AND PREPAYMENTS.

Section 2.01 Loans.

(a) The Lender agrees to make on the terms and subject to the conditions of this Loan
Agreement, loans (individually, a “Loan” and, collectively, the “Loans”) to the
Borrowers in Dollars, from and including the Effective Date to but not including the Termination
Date in an aggregate principal amount at any one time outstanding up to but not exceeding the
lesser of (i) the Lender’s Commitment as then in effect and (ii) the Lender’s Commitment Percentage
of the Borrowing Base as in effect from time to time.

(b) Subject to the terms and conditions of this Loan Agreement, during such period the
Borrowers may borrow, repay and reborrow hereunder; provided, that notwithstanding the foregoing,
the Lender shall not have any obligation to make Loans to the Borrowers in excess of the lesser of
(i) the Maximum Credit and (ii) the Borrowing Base and, if a Tangible Net Worth Trigger Event shall
have occurred or in the event the obligation of the Lender to make Loans to the Borrowers shall
otherwise be terminated as permitted hereunder, the Lender shall not have any further obligation to
make additional Loans hereunder.

Section 2.02 Notes.

(a) The Loans made by the Lender shall be evidenced by a single promissory note of the
Borrowers substantially in the form of Exhibit A hereto (each, a “Note”,
collectively, the “Notes”), dated the date hereof, payable to the order of the Lender in a
principal amount equal to the lesser of (i) the amount of the Commitment of the Lender and (ii) the
aggregate unpaid principal amount of all Loans made by the Lender and otherwise duly completed.
The Lender shall have the right to have its Note subdivided, by exchange for promissory notes of
lesser denominations or otherwise.

(b) The date, amount and interest rate of each Loan made by the Lender to the Borrowers, and
each payment made on account of the principal thereof, shall be recorded by the Lender on its books
and, prior to any transfer of its Note, endorsed by the Lender on the schedule attached to its Note
or any continuation thereof; provided, that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrowers to make a payment when
due of any amount owing hereunder or under its Note in respect of the Loans made by the Lender.

Section 2.03 Procedure for Borrowing (Loans other than Wet-Ink Transactions).

(a) The Borrowers may request a borrowing hereunder that is not a Wet-Ink Transaction on any
Business Day during the period from and including the Effective Date to and including the
Termination Date, by delivering to the Agent, with a copy to the Custodian, a written request for
borrowing, substantially in the form of Exhibit D attached hereto, which request must be
received by the Agent prior to 12:00 p.m., New York City time, at least one (1) Business Day prior
to the requested Funding Date. Such request for borrowing shall (i) attach a schedule identifying
the Eligible Mortgage Loans that the Borrowers propose to pledge to the Agent, for the benefit of
the Lender, and which are to be included in the Borrowing Base in connection with such borrowing,
(ii) specify the requested Funding Date and the amount requested to be borrowed, (iii) be
accompanied by a Mortgage Loan Data File containing information with respect to the Eligible
Mortgage Loans that the Borrowers propose to pledge to the Agent, for the benefit of the Lender,
and to be included in the Borrowing Base in connection with such borrowing, and (iv) attach an
officer’s certificate signed by a Responsible Officer of each applicable Borrower as required by
Section 5.02(b) hereof.

(b) Upon the Borrowers’ request for a borrowing pursuant to Section 2.03(a), the Lender shall,
subject to the limitations set forth in Section 2.01(a) hereof and upon satisfaction of all
conditions precedent set forth in Sections 5.01 and 5.02 hereof, make a Loan to the Borrowers on
the requested Funding Date, in the amount so requested; provided, however, that if the
Mortgage Loan Data File includes Discretionary Mortgage Loans, which the Borrowers propose to
pledge to the Agent for the benefit of the Lender and which are to be included in the Borrowing
Base in connection with such borrowing, the Lender’s obligation to fund such Discretionary Mortgage
Loans shall be in its sole and absolute discretion. The Borrowers acknowledge that the Agent may
retain for the account of the Lender an amount equal to $100 per Defaulted Mortgage Loan to cover
the costs of obtaining Broker Price Opinions.

(c) The Borrowers shall release to the Custodian no later than 1:30 p.m. New York time, one
(1) Business Day prior to any Funding Date (in the case of the first 150 Eligible Mortgage Loans
delivered in connection with any Funding Date) plus one (1) additional Business Day prior to any
Funding Date (for each additional 100 Eligible Mortgage Loans in excess thereof delivered in
connection with any Funding Date), the Mortgage File pertaining to each Eligible Mortgage Loan to
be pledged to the Agent, for the benefit of the Lender, and included in the Borrowing Base on such
requested Funding Date, in accordance with the terms and conditions of the Custodial Agreement.

(d) Pursuant to the Custodial Agreement, the Custodian shall deliver to the Agent and the
Borrowers, no later than 1:00 p.m., New York City time on a Funding Date, a Trust Receipt (as
defined in the Custodial Agreement) in respect of all Mortgage Loans pledged to the Agent, for the
benefit of the Lender, on such Funding Date, and a Mortgage Loan Schedule and Exception Report.
The Borrowers acknowledge that Mortgage Loans listed in the Exception Report are not Eligible
Mortgage Loans and no Lender is required to advance funds in respect of such Mortgage Loans and
such Mortgage Loans listed in the Exception Report shall not be subject to the Lien of this Loan
Agreement.

(e) Subject to Article V hereof, such borrowing will then be made available to the Borrowers
by the Agent transferring, via wire transfer, to the following account of the Borrowers: ABA #
021001033, Account #01419663, Attn: New Century, in the aggregate amount of such borrowing in funds
immediately available to the Borrowers.

(f) Unless the Agent shall have been notified in writing by the Lender prior to a Funding Date
for Loans hereunder that the Lender will not make the amount that would constitute its share of the
Loans being made on such date available to the Agent, the Agent may, in reliance upon such
assumption make available to the Borrowers a corresponding amount. If such amount is not made
available to the Agent on the Funding Date therefor, the Lender shall pay to the Agent, on demand,
such amount with interest thereon at a rate per annum equal to the rate specified in the first
sentence of Section 2.06(b) for the period until the Lender makes such amount immediately available
to the Agent. A certificate of the Agent submitted to the Lender with respect to any amounts owing
under this Section shall be conclusive in the absence of manifest error. If the Lender’s pro rata
share of such borrowing is not made available to the Agent by the Lender within one (1) Business
Day after such Funding Date, the Agent shall also be entitled to recover such amount with interest
thereon at a rate per annum equal to the rate specified in the first sentence of Section 2.06(b),
on demand, from the Borrowers.

Section 2.04 Procedure For Borrowing (Wet-Ink Transactions).

(a) With respect to each Wet-Ink Transaction, the Borrowers may request a borrowing hereunder,
on any Business Day during the period from and including the Effective Date to and excluding the
Termination Date (provided that no Borrowing Base Deficiency exists due to the inclusion of
Nine-Day Aged Wet-Ink Mortgage Loans in the Borrowing Base on such date), by delivering to the
Agent, an estimate of the amount required to fund Wet-Ink Transactions the following Business Day,
which estimate must be received by the Agent prior to 5:00 p.m., New York City time, one (1)
Business Day prior to the requested Funding Date.

(b) On the requested Funding Date, the Borrowers may deliver to the Agent, with a copy to the
Custodian, no more than an aggregate total of three (3) transmissions, which transmissions shall
(i) attach a written request for borrowing, substantially in the form of Exhibit D attached
hereto, (ii) attach a schedule identifying the Eligible Mortgage Loans that the Borrowers propose
to pledge to the Agent for the benefit of the Lender hereunder, and to be included in the Borrowing
Base in connection with such borrowing, (iii) specify the amount requested to be borrowed, (iv)
attach a schedule identifying the amount and wiring instructions with respect to the settlement
location of each wire transfer on such date and (v) attach an officer’s certificate signed by a
Responsible Officer of each applicable Borrower as required by Section 5.02(b) hereof. Pursuant to
the Custodial Agreement, the Custodian shall deliver to the Agent and the Borrowers, in connection
with each transmission, a Mortgage Loan Schedule in respect of all Mortgage Loans pledged to the
Agent, for the benefit of the Lender, on such Funding Date. The latest transmission must be
received by the Agent no later than 4:00 p.m., New York City time, on such Funding Date. Such
request for borrowing shall specify the requested Funding Date.

(c) The Borrowers shall deliver (or cause to be delivered) and release to the Custodian the
Mortgage File pertaining to such Wet-Ink Mortgage Loan on the next Business Day following receipt
of such Mortgage File by the applicable Borrower, but in any event no later than eight (8) Business
Days following the applicable Funding Date in accordance with the terms and conditions of the
Custodial Agreement. On the applicable Funding Date and on each Business Day following the
applicable Funding Date, no later than 8:00 p.m., New York City time, pursuant to the Custodial
Agreement, the Custodian shall deliver to the Agent a schedule listing each Wet-Ink Mortgage Loan
with respect to which the complete Mortgage File has not been received by the Custodian (the
“Wet-Ink Aged Report”). On the applicable Funding Date, the Agent shall confirm that the
information in the Wet-Ink Aged Report is consistent with the information provided to the Agent
pursuant to Section 2.04(b).

(d) Upon the Borrowers’ request for a borrowing pursuant to Section 2.04(a), the Agent shall
promptly notify the Lender thereof. The Lender shall thereupon, upon satisfaction of all
conditions precedent set forth in Sections 5.01, 5.02 and 5.03 hereof, make its Commitment
Percentage of the amount of such Borrowing available to the Agent for the account of the Borrowers
at the office of the Agent specified in Section 11.02, on the Funding Date requested by the
Borrowers in funds immediately available to the Agent.

(e) Subject to Article V hereof, such borrowing will be made available by the Agent
transferring the amount of such borrowing to the Wet Funding Account. In accordance with the
Custodial Agreement, the Custodian shall then transfer, at the direction of the Agent, via wire
transfer, the amount of such borrowing from the Wet Funding Account to the account of the
designated Closing Agent pursuant to disbursement instructions provided by the Borrowers on the
electronic system maintained by the Custodian; provided, however, that (i) the
Agent shall approve, in its sole discretion, each wiring location, (ii) the Custodian shall not, in
any event, (A) transfer funds to any Borrower or (B) transfer funds in excess of the original
principal balance of the related Wet-Ink Mortgage Loan. Pursuant to the Custodial Agreement, the
Custodian shall deliver to the Wet Funding Account and the Borrowers, no later than 6:00 p.m., New
York City time, on each Funding Date with respect to a Wet-Ink Transaction, a report identifying
the wire transfer amount and the settlement location of each wire transfer made on such date. Upon
notice from the Closing Agent to the Borrowers that the related Wet-Ink Mortgage Loan was not
originated, the Wet-Ink Mortgage Loan shall be removed from the list of Eligible Mortgage Loans and
the Closing Agent shall immediately return the funds via wire transfer to the Wet Funding Account.
The Borrowers shall notify the Agent if a Wet-Ink Mortgage Loan was not originated and has been
removed from the list of Eligible Mortgage Loans.

(f) With respect to transmissions delivered pursuant to Section 2.04(b) which are received by
the Agent no later than 4:00 p.m., New York City time, on each Funding Date, the Agent shall
transfer to the account of the Borrowers identified in Section 2.03(e), no later than 5:00 p.m.,
New York City time, the difference, if any, between (i) the aggregate Collateral Value of the
Wet-Ink Mortgage Loans pledged to the Agent, for the benefit of the Lender, and included in the
Borrowing Base on such date and (ii) the aggregate amount transferred by the Custodian to the
accounts of designated Closing Agents with respect to such Wet-Ink Mortgage Loans on such date.

(g) Unless the Agent shall have been notified in writing by the Lender prior to a Funding Date
for Loans hereunder that the Lender will not make the amount that would constitute its share of the
Loans being made on such date available to the Agent, the Agent may, in reliance upon such
assumption make available to the Borrowers a corresponding amount. If such amount is not made
available to the Agent on the Funding Date therefor, the Lender shall pay to the Agent, on demand,
such amount with interest thereon at a rate per annum equal to the rate specified in the first
sentence of Section 2.06(b) for the period until the Lender makes such amount immediately available
to the Agent. A certificate of the Agent submitted to the Lender with respect to any amounts owing
under this Section shall be conclusive in the absence of manifest error. If the Lender’s pro rata
share of such borrowing is not made available to the Agent by the Lender within one (1) Business
Day after such Funding Date, the Agent shall also be entitled to recover such amount with interest
thereon at a rate per annum equal to the rate specified in the first sentence of Section 2.06(b),
on demand, from the Borrowers.

Section 2.05 Limitation on Types of Loans; Illegality. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of any Eurodollar Rate:

(a) the Agent determines, which determination shall be conclusive, that quotations of interest
rates for the relevant deposits referred to in the definition of “Eurodollar Rate” in Section 1.01
hereof are not being provided in the relevant amounts or for the relevant maturities for purposes
of determining rates of interest for Loans as provided herein; or

(b) the Lender determines, which determination shall be conclusive, that the relevant rate of
interest referred to in the definition of “Eurodollar Rate” in Section 1.01 hereof upon the basis
of which the rate of interest for Loans is to be determined is not likely adequately to cover the
cost to the Lender of making or maintaining Loans; or

(c) it becomes unlawful for the Lender to honor its obligation to make or maintain Loans
hereunder using a Eurodollar Rate;

then the Agent or the Lender, as the case may be, shall give the Borrowers prompt notice thereof
and, so long as such condition remains in effect, the Lender shall be under no obligation to make
additional Loans, and each Borrower shall, at its sole option and discretion, either prepay all
such Loans as may be outstanding or pay interest on such Loans at a rate per annum equal to the
Federal Loan Rate; provided, that if the Lender determines not to make any additional
Loans, then the Borrowers shall be reimbursed a pro rata portion of the fees paid pursuant to
Section 3.04, the amount of any such reimbursement shall be based (i) if the determination not to
make any additional Loans is made prior to the one year anniversary of the Effective Date, upon the
number of days elapsed from the Effective Date to date of such determination solely with respect to
the amount of the commitment and structuring fees received by the Agent pursuant to Section 3.04(a)
or (ii) if the determination not to make any additional Loans is made on or after the one year
anniversary of the Effective Date, upon the number of days elapsed from the one year anniversary of
the Effective Date to date of such determination solely with respect to the amount of the
structuring fee received by the Agent pursuant to Section 3.04(b).

Section 2.06 Repayment of Loans; Interest.

(a) The Borrowers hereby promise, jointly and severally, to repay in full in Dollars on the
Termination Date, the aggregate principal amount of the Loans then outstanding.

(b) The Borrowers hereby promise, jointly and severally, to pay to the Agent for the account
of the Lender interest on the unpaid principal amount of each Loan for the period from and
including the date of such Loan to, but excluding, the date such Loan shall be paid in full, at a
rate per annum equal to the Applicable Loan Rate. Notwithstanding the foregoing, the Borrowers
hereby promise to pay to the Agent for the account of the Lender interest at the applicable
Post-Default Rate on any principal of any Loan and on any other amount payable by the Borrowers
hereunder or under any Note that shall not be paid in full when due (whether at stated maturity, by
acceleration or by mandatory prepayment or otherwise) for the period from and including the due
date thereof to but excluding the date the same is paid in full. Interest shall accrue on the
unpaid principal balance of each Loan on a daily basis. Accrued interest on each Loan shall be
payable monthly in arrears on the first (1st) Business Day of each month and for the
last month of the Loan Agreement on the first (1st) Business Day of such last month and
on the Termination Date; provided, that the Agent may, in its sole discretion, require
accrued interest to be paid simultaneously with any prepayment of principal made by the Borrowers
on account of any of the Loans outstanding. Interest payable at the Post-Default Rate shall accrue
daily and shall be payable in accordance with the foregoing.

(c) It is understood and agreed that, unless and until a Default shall have occurred and be
continuing, the Borrowers shall be entitled to the proceeds of the Mortgage Loans pledged to the
Agent, for the benefit of the Lender hereunder.

Section 2.07 Mandatory prepayments or Pledge.

(a) If at any time the aggregate outstanding principal amount of Loans exceeds the Borrowing
Base (a “Borrowing Base Deficiency”), as determined by the Agent and notified to the
Borrowers on any Business Day, the Borrowers shall no later than one (1) Business Day after receipt
of such notice, either prepay the Loans in part or in whole or pledge additional Eligible Mortgage
Loans (which Collateral shall be in all respects acceptable to the Agent in its sole discretion) to
the Agent for the account of the Lender, such that after giving effect to such prepayment or pledge
of additional Eligible Mortgage Loans a Borrowing Base Deficiency shall no longer exist.

(b) If at any time the aggregate outstanding principal amount of Loans exceeds the Maximum
Credit then in effect, the Borrowers shall at such time prepay the Loans such that, after giving
effect to such prepayment, the aggregate outstanding principal amount of Loans shall not exceed the
Maximum Credit then in effect.

(c) If at any time MS & Co.’s corporate bond rating has been lowered or downgraded to a rating
below A- by S&P or A3 by Moody’s, the Borrowers shall repay all amounts owing to the Lender under
this Loan Agreement, the Notes and the other Loan Documents within ninety (90) days following
receipt of notice of such downgrade and request for repayment.

(d) With respect to each Mortgage Loan subject to a Takeout Commitment, the Borrowers shall
instruct the related Takeout Investor to remit directly to the Agent no later than 3:00 p.m., New
York City time, on a Business Day all Takeout Proceeds in an amount equal to the payoff amount
under this Loan Agreement for such Mortgage Loan. Simultaneously, the Borrowers shall deliver to
the Agent via facsimile or electronic mail a purchase advice (the “Purchase Advice”) and
shall indicate on such Purchase Advice the Mortgage Loan identification number which identified the
applicable Mortgage Loan when it was financed by the Lender hereunder. A portion of the Takeout
Proceeds in an amount equal to the Collateral Value of such Mortgage Loan shall be applied to the
prepayment of principal outstanding on the Loans. Upon receipt by the Agent of payment of all
amounts owing hereunder in respect of such Mortgage Loan, the Agent shall release and remit to the
Borrowers the amount of any Takeout Proceeds in excess of the Collateral Value of such Mortgage
Loans (the “Remittance Amount”); provided, that, both immediately before and after
giving effect to such release and remittance, (i) there is no Default or Event of Default under
this Loan Agreement or any other Loan Document and (ii) there is no Borrowing Base Deficiency. To
the extent that a Borrowing Base Deficiency exists or would be created by the release of the
Remittance Amount or an Event of Default has occurred and is continuing, the Agent shall be
entitled to retain the Remittance Amount, and the Borrowers thereupon shall have no further rights,
title, or interest in and to such Remittance Amount. In the event that the Purchase Advice
indicates that some of the proceeds forwarded to the Agent do not belong to the Agent, the Lender
hereunder or the Borrowers (such amount, the “Excess Proceeds”), then (i) the Borrowers
shall provide the Agent with a takeout proceeds identification letter in the form of Exhibit
K hereto, and (ii) upon confirmation by the Agent that the information set forth in the
Purchase Advice matches the information that the Agent has in its possession with respect to the
Mortgage Loans, the Agent shall promptly remit by wire transfer the Excess Proceeds in accordance
with the Borrowers’ instructions. If funds are received before 3:00 p.m., New York City time on a
Business Day, but either (A) no Purchase Advice is received or (B) such funds are not properly
identified on the related Purchase Advice (a “Purchase Advice Deficiency”), then such funds
shall be retained by the Agent, and the Loans made in respect of the related Mortgage Loans shall
continue to accrue interest under this Loan Agreement, until such Purchase Advice Deficiency is
remedied, and the Mortgage Loan subject to such Purchase Advice shall not be released until such
Purchase Advice Deficiency is remedied. In no event shall such Purchase Advice be back-dated to
the date of its issuance. Neither the Agent nor the Lender shall be liable to the Borrowers or any
other Person to the extent that the Agent follows instructions given to it by the Borrowers in a
takeout proceeds identification letter in the form of Exhibit K hereto.

Section 2.08 Extension of Termination Date.

At the request of the Borrowers made at least thirty (30) days, but in no event earlier than
ninety (90) days, prior to the then current Termination Date, the Agent may, at the direction of
the Lender, extend the Termination Date for a period to be determined by the Lender in their sole
discretion by giving written notice of such extension to the Borrowers no later than twenty (20)
days, but in no event earlier than thirty (30) days, prior to the then current Termination Date.
Any failure by the Agent to deliver such notice of extension shall be deemed to be the Agent’s
determination not to extend the then current Termination Date.

ARTICLE III

PAYMENTS; COMPUTATIONS; ETC.

Section 3.01 Payments.

(a) Except to the extent otherwise provided herein, all payments of principal, interest and
other amounts to be made by the Borrowers under this Loan Agreement and the Notes, shall be made in
Dollars, in immediately available funds, without deduction, set-off or counterclaim, to the Agent
at the following account maintained by the Agent: Citibank, N.A., Account No. 40615114, ABA No.
021000089, Attn: Whole Loan Operations, not later than 1:00 p.m., New York City time, on the date
on which such payment shall become due (and each such payment made after such time on such due date
shall be deemed to have been made on the next succeeding Business Day). Each Borrower acknowledges
that it has no rights of withdrawal from the foregoing account. The Agent shall promptly provide
to the Lender (via facsimile or other transmission) the amount of such payment to be distributed to
such Lender along with the outstanding Loans then held by the Lender, after giving effect to such
payment.

(b) Except to the extent otherwise expressly provided herein, if the due date of any payment
under this Loan Agreement or any Note would otherwise fall on a day that is not a Business Day,
such date shall be extended to the next succeeding Business Day, and interest shall be payable for
any principal so extended for the period of such extension.

Section 3.02 Computations. Interest on the Loans shall be computed on the basis of a
360-day year for the actual number of days elapsed (including the first day but excluding the last
day) occurring in the period for which payable.

Section 3.03 Requirements of Law.

(a) If any Requirement of Law (other than with respect to any amendment made to any Lender’s
certificate of incorporation and by-laws or other organizational or governing documents) or any
change in the interpretation or application thereof or compliance by any Lender with any request or
directive (whether or not having the force of law) from any central bank or other Governmental
Authority made subsequent to the date hereof:

(i) shall subject the Lender to any tax of any kind whatsoever with respect to this
Loan Agreement, its Note or any Loan made by it (excluding taxes on the Lender’s net income)
or change the basis of taxation of payments to the Lender in respect thereof;

(ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory
Loan or similar requirement against assets held by, deposits or other liabilities in or for
the account of, advances, Loans or other extensions of credit by, or any other acquisition
of funds by, any office of the Lender which is not otherwise included in the determination
of the Eurodollar Rate hereunder; or

(iii) shall impose on the Lender any other condition;

and the result of any of the foregoing is to increase the cost to the Lender, by an amount which
the Lender deems to be material, of making, participating in, continuing or maintaining any Loan or
to reduce any amount due or owing hereunder in respect thereof, then, in any such case, the
Borrowers shall promptly pay the Lender such additional amount or amounts as will compensate the
Lender for such increased cost or reduced amount receivable.

(b) If the Lender shall have determined that the adoption of or any change in any Requirement
of Law (other than with respect to any amendment made to the Lender’s certificate of incorporation
and by-laws or other organizational or governing documents) regarding capital adequacy or in the
interpretation or application thereof or compliance by the Lender or any corporation controlling
the Lender with any request or directive regarding capital adequacy (whether or not having the
force of law) from any Governmental Authority made subsequent to the date hereof shall have the
effect of reducing the rate of return on the Lender’s or such corporation’s capital as a
consequence of its obligations hereunder to a level below that which the Lender or such corporation
would have achieved but for such adoption, change or compliance (taking into consideration the
Lender’s or such corporation’s policies with respect to capital adequacy) by an amount deemed by
the Lender to be material, then from time to time, each Borrower shall either (i) promptly pay to
the Lender such additional amount or amounts as will compensate the Lender for such reduction or
(ii) at its sole option and discretion, prepay all Loans as may be outstanding and terminate this
Loan Agreement. If the Borrowers prepay all outstanding Loans and terminate this Loan Agreement as
provided in (ii) of the prior sentence, then the Borrowers shall be reimbursed a pro rata portion
of the fees paid pursuant to Section 3.04, the amount of any such reimbursement shall be based (x)
if such prepayment and termination is made prior to the one year anniversary of the Effective Date,
upon the number of days elapsed from the Effective Date to date of such determination solely with
respect to the amount of the commitment and structuring fees received by the Agent, respectively,
pursuant to Section 3.04(a) or (y) if such prepayment and termination is made on or after the one
year anniversary of the Effective Date, upon the number of days elapsed from the one year
anniversary of the Effective Date to date of such determination solely with respect to the amount
of the structuring fee received by the Agent pursuant to Section 3.04(b).

(c) If the Lender becomes entitled to claim any additional amounts pursuant to this Article,
it shall promptly notify the Borrowers of the event by reason of which it has become so entitled. A
certificate as to any additional amounts payable pursuant to this Section submitted by the Lender
to the Borrowers shall be conclusive in the absence of manifest error.

Section 3.04 Facility Fees. The Borrowers agree to pay a structuring fee in amount
equal to 0.05% (5 basis points) of the Maximum Credit on or before December 31, 2005, such payment
to be made in Dollars, in immediately available funds, without deduction, set-off or counterclaim,
to the account of the Agent set forth in Section 3.01(a) hereof. In the event that MS & Co.’s
corporate bond rating shall have been lowered or downgraded to a rating below A- by S&P or A3 by
Moody’s and the Agent shall have notified the Borrowers pursuant to Section 2.07(c) of this Loan
Agreement that the Borrowers are required to repay all amounts owing to the Lender under this Loan
Agreement, the Notes and the other Loan Documents within ninety (90) days following receipt of such
notice, (i) from and after the date of any such notification, the Borrowers shall have no
obligation to make any further payments in respect of the fees described above in this Section
3.04.

ARTICLE IV

COLLATERAL SECURITY.

Section 4.01 Collateral; Security Interest.

(a) Pursuant to the Custodial Agreement, the Custodian shall hold the Mortgage Loan Documents
as exclusive bailee and agent for the Agent on behalf of the Lender pursuant to terms of the
Custodial Agreement and shall deliver Trust Receipts (as defined in the Custodial Agreement) to the
Agent, each to the effect that it has reviewed such Mortgage Loan Documents in the manner and to
the extent required by the Custodial Agreement and identifying any deficiencies in such Mortgage
Loan Documents as so reviewed.

(b) All of each Borrower’s right, title and interest in, to and under each of the following
items of property, whether now owned or hereafter acquired, now existing or hereafter created and
wherever located, is hereinafter referred to as the “Collateral”:

(i) all Mortgage Loans;

(ii) all Mortgage Loan Documents, including, without limitation, all promissory notes
and all Servicing Records, Servicing Agreements and any other collateral pledged or
otherwise relating to such Mortgage Loans, together with all files, documents, instruments,
surveys, certificates, correspondence, appraisals, computer programs (subject to any
restrictions on transfer under any related licensing agreement), accounting records and
other books and records relating thereto, including electronic records;

(iii) all mortgage guaranties and insurance (issued by governmental agencies or
otherwise) and any mortgage insurance certificate or other document evidencing such mortgage
guaranties or insurance relating to any Mortgage Loan and all claims and payments
thereunder;

(iv) all other insurance policies and insurance proceeds relating to any Mortgage Loan
or the related Mortgaged Property;

(v) all Takeout Commitments now existing or hereafter arising, covering any part of the
foregoing Collateral, all rights to deliver such Mortgage Loans to Takeout Investors or to
permanent investors and other purchasers pursuant thereto and all proceeds resulting from
the disposition of such Collateral pursuant thereto, including the Borrowers’ right and
entitlement to receive the entire Takeout Price specified in each Takeout Commitment with
respect to the Mortgage Loans pledged hereunder;

(vi) all Interest Rate Protection Agreements, relating to or constituting any and all
of the foregoing;

(vii) the Controlled Accounts and all monies from time to time on deposit in the
Controlled Accounts;

(viii) all collateral, however defined, under any other agreement between a Borrower or
any of its Affiliates on the one hand and the Lender or any of its Affiliates on the other
hand;

(ix) all “general intangibles”, “accounts” and “chattel paper” as defined in the
Uniform Commercial Code relating to or constituting any and all of the foregoing; and

(x) any and all replacements, substitutions, distributions on or proceeds of any and
all of the foregoing.

(c) Each Borrower hereby assigns, pledges and grants a security interest in all of its right,
title and interest in, to and under the Collateral to the Agent, for the benefit of the Lender, to
secure the MS Indebtedness including, without limitation, the repayment of principal of and
interest on all Loans and all other amounts owing to the Lender hereunder, under the Notes and
under the other Loan Documents (collectively, the “Secured Obligations”). Each Borrower
agrees to mark its computer records and tapes to evidence the interests granted hereunder to the
Agent, for the benefit of the Lender.

Section 4.02 Further Documentation. At any time and from time to time, upon the
written request of the Agent, and at the sole expense of the Borrowers, the Borrowers will promptly
and duly execute and deliver, or will promptly cause to be executed and delivered, such further
instruments and documents and take such further action as the Agent may reasonably request for the
purpose of obtaining or preserving the full benefits of this Loan Agreement and of the rights and
powers herein granted, including, without limitation, the filing of any financing or continuation
statements under the Uniform Commercial Code in effect in any jurisdiction with respect to the
Liens created hereby. Each Borrower also hereby authorizes the Agent to file any such financing or
continuation statement without the signature of any Borrower to the extent permitted by applicable
law. A photographic or other reproduction of this Loan Agreement shall be sufficient as a
financing statement for filing in any jurisdiction.

Section 4.03 Changes in Locations, Names, etc. The Borrowers shall not (i) change the
location of its chief executive office/chief place of business from that specified in Article VI
hereof, (ii) change its name, identity or corporate structure (or the equivalent), or change the
location where it maintains its records with respect to the Collateral or (iii) reincorporate or
reorganize under the laws of another jurisdiction unless it shall have given the Agent at least 30
days prior written notice thereof and shall have delivered to the Agent all Uniform Commercial Code
financing statements and amendments thereto as the Agent shall request and taken all other actions
deemed necessary by the Agent to continue its perfected status in the Collateral with the same or
better priority. Each Borrower’s federal tax identification number and its organizational
identification number is as set forth on Schedule 5 hereto. The Borrowers will promptly
notify the Lender of any change in any such identification number.

Section 4.04 Agent’s Appointment as Attorney-in-Fact.

(a) Each Borrower hereby irrevocably constitutes and appoints the Agent and any officer or
agent thereof, with full power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of such Borrower and in the name of such
Borrower or in its own name, from time to time in the Agent’s discretion, for the purpose of
carrying out the terms of this Loan Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or desirable to accomplish the
purposes of this Loan Agreement, and, without limiting the generality of the foregoing, such
Borrower hereby gives the Agent the power and right, on behalf of such Borrower, without assent by,
but with notice to such Borrower, if an Event of Default shall have occurred and be continuing, to
do the following:

(i) in the name of such Borrower or its own name, or otherwise, to take possession of
and endorse and collect any checks, drafts, notes, acceptances or other instruments for the
payment of moneys due under any mortgage insurance or with respect to any other Collateral
and to file any claim or to take any other action or proceeding in any court of law or
equity or otherwise deemed appropriate by the Agent for the purpose of collecting any and
all such moneys due under any such mortgage insurance or with respect to any other
Collateral whenever payable;

(ii) to pay or discharge taxes and Liens levied or placed on or threatened against the
Collateral; and

(iii) (A) to direct any party liable for any payment under any Collateral to make
payment of any and all moneys due or to become due thereunder directly to the Agent or as
the Agent shall direct; (B) to ask or demand for, collect, receive payment of and receipt
for, any and all moneys, claims and other amounts due or to become due at any time in
respect of or arising out of any Collateral; (C) to sign and endorse any invoices,
assignments, verifications, notices and other documents in connection with any of the
Collateral; (D) to commence and prosecute any suits, actions or proceedings at law or in
equity in any court of competent jurisdiction to collect the Collateral or any portion
thereof and to enforce any other right in respect of any Collateral; (E) to defend any suit,
action or proceeding brought against such Borrower with respect to any Collateral; (F) to
settle, compromise or adjust any suit, action or proceeding described in clause (E) above
and, in connection therewith, to give such discharges or releases as the Agent may deem
appropriate; and (G) generally, to sell, transfer, pledge and make any agreement with
respect to or otherwise deal with any of the Collateral as fully and completely as though
the Agent were the absolute owner thereof for all purposes, and to do, at the Agent’s option
and such Borrower’s expense, at any time, and from time to time, all acts and things which
the Agent deems necessary to protect, preserve or realize upon the Collateral and the
Agent’s Liens thereon and to effect the intent of this Loan Agreement, all as fully and
effectively as such Borrower might do.

Each Borrower hereby ratifies all that said attorneys shall lawfully do or cause to be done by
virtue hereof. This power of attorney is a power coupled with an interest and shall be
irrevocable.

(b) Each Borrower also authorizes the Agent, at any time and from time to time, to execute, in
connection with any sale provided for in Section 4.07 hereof, any endorsements, assignments or
other instruments of conveyance or transfer with respect to the Collateral and to file any initial
financing statements, amendments thereto and continuation statements with or without the signature
of any Borrower as authorized by applicable law, as applicable to all or any part of the
Collateral.

(c) The powers conferred on the Agent pursuant to this Section 4.04 are solely to protect the
Lender’s interests in the Collateral and shall not impose any duty upon the Agent to exercise any
such powers. The Agent shall be accountable only for amounts that it actually receives as a result
of the exercise of such powers, and neither the Agent nor any of its officers, directors, or
employees shall be responsible to the Borrowers for any act or failure to act hereunder, except for
its own gross negligence, bad faith or willful misconduct.

Section 4.05 Performance by Agent of Borrowers’ Obligations. If any Borrower fails to
perform or comply with any of its agreements contained in the Loan Documents (except with respect
to the payment of any amounts, whether in respect of any principal, interest or otherwise, owing to
the Lender under this Loan Agreement or any other Loan Document) and the Agent itself performs or
complies, or otherwise causes performance or compliance, with such agreement, the expenses of the
Agent incurred in connection with such performance or compliance, together with interest thereon at
a rate per annum equal to the Post-Default Rate, shall be payable by the Borrowers to the Agent on
demand and shall constitute Secured Obligations.

Section 4.06 Proceeds. If an Event of Default shall occur and be continuing, (a) all
proceeds of Collateral received by the Borrowers consisting of cash, checks and other near-cash
items shall be held by the Borrowers in trust for the Agent for the benefit of the Lender,
segregated from other funds of the Borrowers, and shall forthwith upon receipt by the Borrowers be
turned over to the Agent in the exact form received by the Borrowers (duly endorsed by the
Borrowers to the Agent, if required) and (b) any and all such proceeds received by the Agent
(whether from the Borrowers or otherwise) may, in the sole discretion of the Agent, be held by the
Agent as collateral security for, and/or then or at any time thereafter may be applied by the Agent
against, the Secured Obligations (whether matured or unmatured), such application to be in such
order as the Agent shall elect. Any balance of such proceeds remaining after the Secured
Obligations shall have been paid in full and this Loan Agreement shall have been terminated shall
be paid over to the Borrowers or to whomsoever may be lawfully entitled to receive the same. For
purposes hereof, proceeds shall include, but not be limited to, all principal and interest
payments, all prepayments and payoffs, insurance claims, condemnation awards, sale proceeds, real
estate owned rents and any other income and all other amounts received with respect to the
Collateral.

Section 4.07 Remedies. If a Default shall occur and be continuing, the Agent may, at
its option and at the Borrowers’ expense, enter into one or more Interest Rate Protection
Agreements covering all or a portion of the Mortgage Loans pledged to the Agent, for the benefit of
the Lender hereunder, and the Borrowers shall be responsible for all damages, judgments, costs and
expenses of any kind which may be imposed on, incurred by or asserted against the Agent relating to
or arising out of such Interest Rate Protection Agreements; including, without limitation, any
losses resulting from such Interest Rate Protection Agreements. If an Event of Default shall occur
and be continuing, the Agent may exercise, in addition to all other rights and remedies granted to
it in this Loan Agreement and in any other instrument or agreement securing, evidencing or relating
to the Secured Obligations, all rights and remedies of a secured party under the Uniform Commercial
Code. Without limiting the generality of the foregoing, the Agent without demand of performance or
other demand, presentment, protest, advertisement or notice of any kind (except any notice required
by law referred to below) to or upon the Borrowers or any other Person (each and all of which
demands, presentments, protests, advertisements and notices are hereby waived), may in such
circumstances forthwith collect, receive, appropriate and realize upon the Collateral, or any part
thereof, and/or may forthwith sell, lease, assign, give option or options to purchase, or otherwise
dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing),
in one or more parcels or as an entirety at public or private sale or sales, at any exchange,
broker’s board or office of the Agent or elsewhere upon such terms and conditions and at such
prices as it may deem best in its good faith judgment, for cash or on credit or for future delivery
without assumption of any credit risk. The Agent shall have the right upon any such public sale or
sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of redemption in the
Borrowers, which right or equity is hereby waived or released. The Borrowers further agree, at the
Agent’s request, to assemble the Collateral and make it available to the Agent at places that the
Agent shall reasonably select, whether at the Borrowers’ premises or elsewhere. The Agent shall
apply the net proceeds of any such collection, recovery, receipt, appropriation, realization or
sale, after deducting all reasonable costs and expenses of every kind incurred therein or
incidental to the care or safekeeping of any of the Collateral or in any way relating to the
Collateral or the rights of the Agent hereunder, including, without limitation, reasonable
attorneys’ fees and disbursements, to the payment in whole or in part of the Secured Obligations,
in such order as the Agent may elect, and only after such application and after the payment by the
Agent of any other amount required or permitted by any provision of law, including, without
limitation, Section 9-608(a)(l)(c) of the Uniform Commercial Code, need the Agent account for the
surplus, if any, to the Borrowers. To the extent permitted by applicable law, each Borrower waives
all claims, damages and demands it may acquire against the Agent or the Lender arising out of the
exercise by the Agent or the Lender of any of its rights hereunder, other than those claims,
damages and demands arising from the gross negligence, bad faith or willful misconduct of the Agent
or the Lender. If any notice of a proposed sale or other disposition of Collateral shall be
required by law, such notice shall be deemed reasonable and proper if given at least ten (10) days
before such sale or other disposition. The Borrowers shall remain liable for any deficiency (plus
accrued interest thereon as contemplated pursuant to Section 2.06(b) hereof) if the proceeds of any
sale or other disposition of the Collateral are insufficient to pay the Secured Obligations and the
fees and disbursements of any attorneys employed by the Agent to collect such deficiency.

Section 4.08 Limitation on Duties Regarding Preservation of Collateral. The Agent’s
duty with respect to the custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the Uniform Commercial Code or otherwise, shall be to deal with
it in the same manner as the Agent deals with similar property for its own account. Neither the
Agent, the Lender nor any of their respective directors, officers or employees shall be liable for
failure to demand, collect or realize upon all or any part of the Collateral or for any delay in
doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the
request of the Borrowers or otherwise.

Section 4.09 Powers Coupled with an Interest. All authorizations and agencies herein
contained with respect to the Collateral are irrevocable and powers coupled with an interest.

Section 4.10 Release of Security Interest. Upon termination of this Loan Agreement
and repayment to the Lender of all Secured Obligations and the performance of all obligations under
the Loan Documents, the Agent shall release its security interest in any remaining Collateral.

ARTICLE V

CONDITIONS PRECEDENT.

Section 5.01 Conditions to Effective Date. The obligation of the Lender to make any
Loans hereunder is subject to the satisfaction of all of the following conditions precedent:

(a) The Agent shall have received all of the following items, each of which shall be
satisfactory to the Agent and its counsel in form and substance:

(i) Loan Agreement. This Loan Agreement, executed and delivered by a duly
authorized officer of each of the Borrowers and the Guarantor.

(ii) Notes. For the Lender, a Note, executed and delivered by a duly
authorized officer of each of the Borrowers.

(iii) Custodial Agreement. The Custodial Agreement, substantially in the form
of Exhibit B hereto, executed and delivered by a duly authorized officer of each of
the Borrowers and the Custodian.

(iv) Control Agreement. A Control Agreement, substantially in the form of
Exhibit J hereto, executed and delivered by a duly authorized officer of each of the
parties thereto.

(v) New Century Guaranty. The New Century Guaranty, executed and delivered by
a duly authorized officer of the Guarantor.

(vi) Organizational Documents. A good standing certificate and certified
copies of the charter and by-laws (or equivalent documents) of each Borrower and the
Guarantor and of all corporate or other authority for each Borrower and the Guarantor with
respect to the execution, delivery and performance of the Loan Documents to which it is a
party, and each other document to be delivered by the Borrowers and the Guarantor from time
to time in connection with the Loan Documents (and the Lender may conclusively rely on such
certificate until it receives notice in writing from the Borrowers or the Guarantor to the
contrary).

(vii) Trust Receipt and Mortgage Loan Schedule and Exception Report. A Trust
Receipt, substantially in the form of Annex 2 of the Custodial Agreement, dated the
Effective Date, from the Custodian, duly completed, with a Mortgage Loan Schedule and
Exception Report attached thereto.

(viii) Servicing Agreement(s). Each Servicing Agreement, if any, certified as
a true, correct and complete copy of the original, together with a fully executed Servicer
Notice and, if the Servicer is an Affiliate of a Borrower, a letter from such Servicer
consenting to termination of the applicable Servicing Agreement, without charge, upon the
occurrence of any Event of Default.

(ix) Financial Statements. The financial statements referenced in Section
6.02.

(x) Underwriting Guidelines. A certified copy of the Underwriting Guidelines.

(xi) Consents, Licenses, Approvals, etc. Copies certified by the Borrowers of
all consents, licenses and approvals, if any, required in connection with the execution,
delivery and performance by the Borrowers of, and the validity and enforceability of, the
Loan Documents, which consents, licenses and approvals shall be in full force and effect.

(xii) Other Documents. Such other documents as the Agent or the Lender may
reasonably request.

(b) Lien Searches and Actions to Perfect Liens. The Agent shall have received the
results of a recent search conducted by a Person satisfactory to the Agent with respect to any
liens which may have been filed against any of the Collateral, and the results of such search shall
be satisfactory to the Agent. The Borrowers shall have taken all such action as the Agent shall
deem necessary or advisable (including, without limitation, the authorization and execution of
Uniform Commercial Code financing, continuation or amendment statements) to perfect, continue or
otherwise ensure perfection of the security interests granted in favor of the Agent under the Loan
Documents.

Section 5.02 Initial and Subsequent Loans. The making of each Loan to the Borrowers
(including the initial Loan) on any Business Day is subject to the satisfaction of the following
further conditions precedent, both immediately prior to the making of such Loan and also after
giving effect thereto and to the intended use thereof:

(a) No Default. No Default or Event of Default shall have occurred and be continuing.

(b) Representations and Warranties. Both immediately prior to the making of such Loan
and also after giving effect thereto and to the intended use thereof, the representations and
warranties made by the Borrowers in Article VI and Schedules 1 and 2 hereof, and
elsewhere in each of the Loan Documents, shall be true, correct and complete on and as of the date
of the making of such Loan in all material respects (in the case of the representations and
warranties in Section 6.10 and Schedules 1 and 2, solely with respect to Mortgage
Loans included in the Borrowing Base) with the same force and effect as if made on and as of such
date (or, if any such representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date). The Agent shall have received an officer’s certificate
signed by a Responsible Officer of each Borrower certifying as to the truth, accuracy and
completeness of the above, which certificate shall specifically include a statement that each
Borrower is in compliance with all governmental licenses and authorizations and is qualified to do
business and in good standing in all required jurisdictions.

(c) Borrowing Base. The aggregate outstanding principal amount of the Loans shall not
exceed the Borrowing Base.

(d) Due Diligence. Subject to the Agent’s right to perform one or more Due Diligence
Reviews pursuant to Section 11.15 hereof, the Agent shall have completed its due diligence review
of the Mortgage Loan Documents for each Loan and such other documents, records, agreements,
instruments, mortgaged properties or information relating to such Mortgage Loans as the Agent in
its sole discretion deems appropriate to review and such review shall be satisfactory to the Agent
in its sole discretion.

(e) Mortgage Loan Schedule and Exception Report. The Agent shall have received from
the Custodian a Mortgage Loan Schedule and Exception Report with Exceptions as are acceptable to
the Agent in its sole discretion in respect of Eligible Mortgage Loans to be pledged hereunder on
such Business Day.

(f) Release Letter. If applicable, the Agent shall have received from the applicable
Borrower a Warehouse Lender’s Release Letter substantially in the form of Exhibit E-2
hereto (or such other form acceptable to the Agent) or a Seller’s Release Letter substantially in
the form of Exhibit E-1 hereto (or such other form acceptable to the Agent) covering each
Mortgage Loan to be pledged to the Agent, for the benefit of the Lender.

(g) Fees and Expenses. The Agent shall have received all fees and expenses of counsel
to the Agent as contemplated by Section 11.03, which amount, at the Agent’s option, may be netted
from any Loan advanced under this Agreement.

(h) No Market Events. None of the following shall have occurred and/or be continuing:

(i) an event or events shall have occurred resulting in the effective absence of a
“repo market” or comparable “lending market” for financing debt obligations secured by
mortgage loans or securities or an event or events shall have occurred resulting in the
Lender not being able to finance any Mortgage Loans through the “repo market” or “lending
market” with traditional counterparties at rates which would have been reasonable prior to
the occurrence of such event or events;

(ii) an event or events shall have occurred resulting in the effective absence of a
“securities market” for securities backed by mortgage loans or an event or events shall have
occurred resulting in the Lender not being able to sell securities backed by mortgage loans
at prices which would have been reasonable prior to such event or events; or

(iii) there shall have occurred a material adverse change in the financial condition of
the Lender which affects (or can reasonably be expected to affect) materially and adversely
the ability of the Lender to fund its obligations under this Loan Agreement;

provided, however, that if any such events shall have occurred or be continuing and the
Lender shall have determined, in its sole discretion, to not make any additional Loans, then the
Borrowers shall be reimbursed a pro rata portion of the fees paid pursuant to Section 3.04, the
amount of any such reimbursement shall be based if the determination not to make any additional
Loans is made prior to the one year anniversary of the Effective Date, upon the number of days
elapsed from the Effective Date to date of such determination solely with respect to the amount of
the structuring fees received by the Agent pursuant to Section 3.04.

(i) No Morgan Stanley Downgrade. Morgan Stanley & Co.’s unsecured long-term debt
rating, as calculated by S&P or Moody’s, has not been lowered or downgraded to a rating below “A-”,
as indicated by S&P, or below “A3”, as indicated by Moody’s.

(j) Filings, Registrations, Recordings. Any documents (including, without limitation,
financing statements) required to be filed, registered or recorded in order to create, in favor of
the Agent, for the benefit of the Lender, a perfected, first-priority security interest in the
Collateral, subject to no Liens other than those created hereunder, shall have been properly
prepared and executed for filing (including the applicable county(ies) if the Agent determines such
filings are necessary in its sole discretion), registration or recording in each office in each
jurisdiction in which such filings, registrations and recordations are required to perfect such
first-priority security interest; provided, that assignments of the Mortgages securing or related
to the Mortgage Loans shall not be required to be recorded prior to the occurrence of an Event of
Default.

(k) Discretionary Mortgage Loans. At least three (3) Business Days prior to a Funding
Date, the Borrowers shall have provided to the Agent a certification as to the reason why a
Discretionary Mortgage Loan has not been previously disposed of by the Borrowers and the Agent
shall have approved of the inclusion of such Discretionary Mortgage Loan in the Mortgage Loan
Schedule and Exception Report to be pledged hereunder on such Funding Date.

(l) No Adverse Litigation. Neither the Agent nor the Lender shall have determined in
good faith that there is any action, proceeding or investigation by or before any Governmental
Authority affecting any of the Borrowers, or any of their Affiliates or Property (including,
without limitation, any Mortgage Loan pledged to the Agent for the benefit of the Lender
hereunder), which, in the good faith judgment of the Agent or the Lender, as the case may be, is
reasonably likely to be adversely determined and which, in the good faith judgment of the Agent or
the Lender, as the case may be, if decided adversely, would have a reasonable likelihood of having
a Material Adverse Effect.

Each request for a borrowing under this Loan Agreement shall constitute a certification by the
Borrowers that all of the conditions set forth in this Article V (other than Sections 5.02(h)-(j)
have been satisfied (both as of the date of such request and as of the date of borrowing).

Section 5.03 Wet-Ink TransactionsThe funding of each Wet-Ink Transaction on any
Business Day is subject to the following further conditions precedent:

(a) Wet-Ink Aged Report. The Agent shall have received from the Custodian a Wet-Ink
Aged Report in form and substance satisfactory to the Agent; and

(b) Wet Aging. A Borrowing Base Deficiency shall not have occurred and be continuing
because of the inclusion of Nine-Day Aged Wet-Ink Mortgage Loans in the Borrowing Base.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES.

Each Borrower represents and warrants to the Agent and the Lender that throughout the term of
this Loan Agreement:

Section 6.01 Existence. Each Borrower (a) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization, (b) has all
requisite corporate or other power, and has all governmental licenses, authorizations, consents and
approvals necessary to own its assets and carry on its business as now being or as proposed to be
conducted, except where the lack of such licenses, authorizations, consents and approvals would not
be reasonably likely to have a Material Adverse Effect, and (c) is qualified to do business and is
in good standing in all other jurisdictions in which the nature of the business conducted by it
makes such qualification necessary, except where failure so to qualify would not be reasonably
likely (either individually or in the aggregate) to have a Material Adverse Effect.

Section 6.02 Financial Condition. Each of the Borrowers and the Guarantor has
heretofore furnished to the Agent a copy of (i) its consolidated balance sheet and the consolidated
balance sheets of its consolidated Subsidiaries for the fiscal year of the Borrowers ended December
31, 2003 and the related consolidated statements of income and retained earnings and of cash flows
for the Borrowers, the Guarantor and their consolidated Subsidiaries for such fiscal year, setting
forth in each case in comparative form the figures for the previous year, with the opinion thereon
of KPMG, LLC and (ii) its consolidated balance sheet and the consolidated balance sheets of its
consolidated Subsidiaries for the three most recently ended quarterly fiscal periods of the
Borrowers and the related consolidated statements of income and retained earnings and of cash flows
for the Borrowers, the Guarantor and their consolidated Subsidiaries for such quarterly fiscal
periods, setting forth in each case in comparative form the figures for the previous year. All such
financial statements fairly present, in all material respects, the consolidated financial condition
of the Borrowers, the Guarantor and their Subsidiaries and the consolidated results of their
operations as at such dates and for such fiscal periods, all in accordance with GAAP applied on a
consistent basis. Since the date of the most recently delivered financials, there has been no
material adverse change in the consolidated business, operations or financial condition of the
Borrowers, the Guarantor and their consolidated Subsidiaries taken as a whole from that set forth
in said financial statements.

Section 6.03 Litigation. Except as otherwise disclosed to the Agent in writing prior
to the date of this Agreement, there is no action, proceeding or investigation by or before any
Governmental Authority affecting any of the Borrowers, or any of their Affiliates or Property
(including, without limitation, any Mortgage Loan pledged to the Agent for the benefit of the
Lender hereunder), which is reasonably likely to be adversely determined and which, if decided
adversely, would have a reasonable likelihood of having a Material Adverse Effect.

Section 6.04 No Breach. Neither (a) the execution and delivery of the Loan Documents
nor (b) the consummation of the transactions therein contemplated in compliance with the terms and
provisions thereof will conflict with or result in a breach of the charter or by-laws of any
Borrower, or any applicable law, rule or regulation, or any order, writ, injunction or decree of
any Governmental Authority, or any Servicing Agreement or other material agreement or instrument to
which any Borrower or any of its Affiliates is a party or by which any of them or any of their
Property is bound or to which any of them is subject, or constitute a default under any such
material agreement or instrument or result in the creation or imposition of any Lien (except for
the Liens created pursuant to this Loan Agreement) upon any Property of any Borrower or any of its
Subsidiaries pursuant to the terms of any such agreement or instrument.

Section 6.05 Action. Each Borrower has all necessary corporate or other power,
authority and legal right to execute, deliver and perform its obligations under each of the Loan
Documents to which it is a party; the execution, delivery and performance by each Borrower of each
of the Loan Documents to which it is a party have been duly authorized by all necessary corporate
or other action on its part; and each Loan Document has been duly and validly executed and
delivered by the Borrowers and constitutes a legal, valid and binding obligation of the Borrowers,
enforceable against the Borrowers in accordance with its terms.

Section 6.06 Approvals. No authorizations, approvals or consents of, and no filings
or registrations with, any Governmental Authority or any securities exchange are necessary for the
execution, delivery or performance by the Borrowers of the Loan Documents or for the legality,
validity or enforceability thereof, except for filings and recordings in respect of the Liens
created pursuant to this Loan Agreement.

Section 6.07 Margin Regulations. Neither the making of any Loan hereunder, nor the
use of the proceeds thereof, will violate or be inconsistent with the provisions of Regulations T,
U or X.

Section 6.08 Taxes. Each Borrower and its Subsidiaries have filed all Federal income
tax returns and all other material tax returns that are required to be filed by them and have paid
all taxes due pursuant to such returns or pursuant to any assessment received by any of them,
except for any such taxes as are being appropriately contested in good faith by appropriate
proceedings diligently conducted and with respect to which adequate reserves have been provided.
The charges, accruals and reserves on the books of each Borrower and its Subsidiaries in respect of
taxes and other governmental charges are, in the opinion of each Borrower, adequate.

Section 6.09 Investment Company Act. No Borrower nor any of its Subsidiaries is an
“investment company”, or a company “controlled” by an “investment company” within the meaning of
the Investment Company Act of 1940, as amended.

Section 6.10 Collateral; Collateral Security.

(a) No Borrower has assigned, pledged, or otherwise conveyed or encumbered any Mortgage Loan
or other Collateral to any other Person, and immediately prior to the pledge of each Mortgage Loan
or any other Collateral to the Agent, a Borrower was the sole owner of such Mortgage Loan or such
other Collateral and had good and marketable title thereto, free and clear of all Liens, in each
case except for Liens to be released simultaneously with the Liens granted in favor of the Agent,
for the benefit of the Lender hereunder.

(b) The provisions of this Loan Agreement are effective to create in favor of the Agent, for
the benefit of the Lender, a valid security interest in all right, title and interest of each
Borrower in, to and under the Collateral.

(c) Upon receipt by the Custodian of each Mortgage Note, endorsed in blank by a duly
authorized officer of the relevant Borrower, the Agent shall have a fully perfected first priority
security interest therein, in the Mortgage Loan evidenced thereby and in the relevant Borrower’s
interest in the related Mortgaged Property.

(d) Upon the filing of financing statements on Form UCC-1 naming the Agent as “Secured Party”
and each Borrower as “Debtor” and describing the Collateral in the jurisdictions and recording
offices listed on Schedule 2 attached hereto, the security interests granted hereunder in
the Collateral will continue to constitute fully perfected first priority security interests under
the Uniform Commercial Code in all right, title and interest of the Borrowers in, to and under such
Collateral which can be perfected by filing under the Uniform Commercial Code.

Section 6.11 Chief Executive Office/Jurisdiction of Organization. On the Effective
Date, and during the four months immediately preceding the Effective Date, each Borrower’s chief
executive office, is, and has been, located at 18400 Von Karman, Suite 1000, Irvine, California
92612. On the Effective Date, the jurisdiction of organization of each Borrower is as set forth on
Schedule 5 hereto.

Section 6.12 Location of Books and Records. The location where each Borrower keeps
its books and records, including all computer tapes and records relating to the Collateral is its
chief executive office.

Section 6.13 True and Complete Disclosure. The information, reports, financial
statements, exhibits and schedules furnished in writing by or on behalf of each Borrower to the
Agent in connection with the negotiation, preparation or delivery of this Loan Agreement and the
other Loan Documents or included herein or therein or delivered pursuant hereto or thereto, when
taken as a whole, do not contain any untrue statement of material fact or omit to state any
material fact necessary to make the statements herein or therein, in light of the circumstances
under which they were made, not misleading. All written information furnished after the date hereof
by or on behalf of each Borrower to the Agent in connection with this Loan Agreement and the other
Loan Documents and the transactions contemplated hereby and thereby will be true, complete and
accurate in every material respect, or (in the case of projections) based on reasonable estimates,
on the date as of which such information is stated or certified. There is no fact known to a
Responsible Officer of each Borrower, after due inquiry, that could reasonably be expected to have
a Material Adverse Effect that has not been disclosed herein, in the other Loan Documents or in a
report, financial statement, exhibit, schedule, disclosure letter or other writing, furnished to
the Agent for use in connection with the transactions contemplated hereby or thereby.

Section 6.14 [Reserved]

Section 6.15 ERISA. Each Plan to which each Borrower or its Subsidiaries make direct
contributions, and, to the knowledge of each Borrower, each other Plan and each Multiemployer Plan
is in compliance in all material respects with, and has been administered in all material respects
in compliance with, the applicable provisions of ERISA, the Code and any other Federal or State
law. No event or condition has occurred and is continuing as to which the Borrowers would be under
an obligation to furnish a report to the Agent under Section 7.01(d) hereof.

Section 6.16 Subsidiaries. Schedule 3 sets forth the name of each direct or
indirect Subsidiary of each Borrower and of the holders of Capital Stock of each Borrower, its form
of organization, its jurisdiction of organization, the total number of issued and outstanding
shares or other interests of Capital Stock thereof, the classes and number of issued and
outstanding shares or other interests of Capital Stock of each such class, the name of each holder
of Capital Stock thereof and the number of shares or other interests of such Capital Stock held by
each such holder and the percentage of all outstanding shares or other interests of such class of
Capital Stock held by such holders.

Section 6.17 Solvency. After giving effect to each Loan (i) the amount of the
“present fair saleable value” of the assets of each Borrower and of such Borrower and its
Subsidiaries, taken as a whole, will, as of such date, exceed the amount of all “liabilities of
such Borrower and of such Borrower and its Subsidiaries, taken as a whole, contingent or
otherwise”, as of such date, as such quoted terms are determined in accordance with applicable
federal and state laws governing determinations of the insolvency of debtors, (ii) the present fair
saleable value of the assets of each Borrower and of such Borrower and its Subsidiaries, taken as a
whole, will, as of such date, be greater than the amount that will be required to pay the
liabilities of such Borrower and of such Borrower and its Subsidiaries, taken as a whole, on their
respective debts as such debts become absolute and matured, (iii) no Borrower, nor any Borrower and
its Subsidiaries, taken as a whole, will have, as of such date, an unreasonably small amount of
capital with which to conduct their respective businesses, and (iv) each Borrower and such Borrower
and its Subsidiaries, taken as a whole, will be able to pay their respective debts as they mature.
For purposes of this Section 6.18, “debt” means “liability on a claim”, “claim” means any (x) right
to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured, and
(y) right to an equitable remedy for breach of performance if such breach gives rise to a right to
payment, whether or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

Section 6.18 Regulatory Status. No Borrower is a “bank holding company” or a direct
or indirect subsidiary of a “bank holding company” as defined in the Bank Holding Company Act of
1956, as amended, and Regulation Y thereunder of the Board of Governors of the Federal Reserve
System or will become a “bank holding company” or a direct or indirect subsidiary of a “bank
holding company” unless it shall have provided the Agent written notice thirty (30) days prior to
such change.

Section 6.19 Real Estate Investment Trust. No REIT Borrower has engaged in any
material “prohibited transactions” as defined in Section 857(b)(6)(B)(iii) and (C) of the Code.
Each REIT Borrower for its current “tax year” (as defined in the Code) is and for all prior tax
years subsequent to its election to be a real estate investment trust has been entitled to a
dividends paid deduction under the requirements of Section 857 of the Code with respect to any
dividends paid by it with respect to each such year for which it claims a deduction in its Form
1120-REIT filed with the United States Internal Revenue Service for such year.

ARTICLE VII

COVENANTS OF THE BORROWERS.

The Borrowers covenant and agree with the Agent and the Lender that, so long as any Loan is
outstanding, and until payment in full of all Secured Obligations:

Section 7.01 Financial Statements. The Borrowers shall deliver to the Agent:

(a) as soon as available and in any event within 90 days after the end of each fiscal year of
the Guarantor, the consolidated balance sheets of the Guarantor and its consolidated Subsidiaries
as at the end of such fiscal year and the related consolidated statements of income and retained
earnings and of cash flows for the Guarantor and its consolidated Subsidiaries for such year,
setting forth in each case in comparative form the figures for the previous year, accompanied by an
opinion thereon of independent certified public accountants of recognized national standing, which
opinion shall not be qualified as to scope of audit or going concern and shall state that said
consolidated financial statements fairly present the consolidated financial condition and results
of operations of the Guarantor and its consolidated Subsidiaries as at the end of, and for, such
fiscal year in accordance with GAAP, and a certificate of such accountants stating that, in making,
the examination necessary for their opinion, they obtained no knowledge, except as specifically
stated, of any Default or Event of Default;

(b) as soon as available and in any event within 30 days after the end of each calendar month,
the unaudited consolidated balance sheets of the Guarantor and its consolidated Subsidiaries as at
the end of such month and the related unaudited consolidated statements of income and retained
earnings and of cash flows of the Guarantor and its consolidated Subsidiaries for such month and
the portion of the fiscal year through the end of such month, setting forth in each case in
comparative form the figures for the previous year, accompanied by (i) a certificate of a
Responsible Officer of the Guarantor, which certificate shall state that said consolidated
financial statement fairly represents the consolidated financial condition and results of operation
of the Guarantor and its consolidated Subsidiaries in accordance with GAAP, consistently applied,
as of the end of, and for, such month (subject to normal year-end audit adjustments) and (ii) the
Board Report.

(c) from time to time such other information regarding the financial condition, operations, or
business of each Borrower or the Guarantor as the Agent may reasonably request; and

(d) as soon as reasonably possible, and in any event within thirty (30) days after a
Responsible Officer of any Borrower knows, or with respect to any Plan or Multiemployer Plan to
which any Borrower or any of its Subsidiaries makes direct contributions, has reason to believe,
that any of the events or conditions specified below with respect to any Plan or Multiemployer Plan
has occurred or exists, a statement signed by a senior financial officer of any Borrower setting
forth details respecting such event or condition and the action, if any, that any Borrower or its
ERISA Affiliate proposes to take with respect thereto (and a copy of any report or notice required
to be filed with or given to PBGC by each Borrower or an ERISA Affiliate with respect to such event
or condition):

(i) any reportable event, as defined in Section 4043(c) of ERISA and the regulations
issued thereunder, with respect to a Plan, as to which PBGC has not by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within thirty (30) days of the
occurrence of such event (provided, that a failure to meet the minimum funding standard of
Section 412 of the Code or Section 302 of ERISA, including, without limitation, the failure
to make on or before its due date a required installment under Section 412(m) of the Code or
Section 302(e) of ERISA, shall be a reportable event regardless of the issuance of any
waivers in accordance with Section 412(d) of the Code); and any request for a waiver under
Section 412(d) of the Code for any Plan;

(ii) the distribution under Section 4041(c) of ERISA of a notice of intent to terminate
any Plan or any action taken by any Borrower or an ERISA Affiliate to terminate any Plan;

(iii) the institution by PBGC of proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan, or the receipt by
any Borrower or any ERISA Affiliate of a notice from a Multiemployer Plan that such action
has been taken by PBGC with respect to such Multiemployer Plan;

(iv) the complete or partial withdrawal from a Multiemployer Plan by any Borrower or
any ERISA Affiliate that results in liability under Section 4201 or 4204 of ERISA (including
the obligation to satisfy secondary liability as a result of a purchaser default) or the
receipt by any Borrower or any ERISA Affiliate of notice from a Multiemployer Plan that it
is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA or that it
intends to terminate or has terminated under Section 4041A of ERISA;

(v) the institution of a proceeding by a fiduciary of any Multiemployer Plan against
any Borrower or any ERISA Affiliate to enforce Section 515 of ERISA, which proceeding is not
dismissed within 30 days; and

(vi) the adoption of an amendment to any Plan that would result in the loss of
tax-exempt status of the Plan and trust of which such Plan is a part if any Borrower or an
ERISA Affiliate fails to provide timely security to such Plan if and as required by the
provisions of Section 401(a)(29) of the Code or Section 307 of ERISA.

Each Borrower will furnish to the Agent, at the time it furnishes each set of financial statements
pursuant to paragraphs (a) and (b) above, a certificate of a Responsible Officer of such Borrower
to the effect that, to the best of such Responsible Officer’s knowledge, such Borrower during such
fiscal period or year has observed or performed all of its covenants and other agreements, and
satisfied every condition, contained in this Loan Agreement and the other Loan Documents to be
observed, performed or satisfied by it, and that such Responsible Officer has obtained no knowledge
of any Default or Event of Default except as specified in such certificate (and, if any Default or
Event of Default has occurred and is continuing, describing, the same in reasonable detail and
describing the action such Borrower has taken or proposes to take with respect thereto).

Section 7.02 Litigation. The Borrowers will, contemporaneous with the delivery of
each certificate furnished pursuant to Section 7.01(b) above, deliver to the Agent a current
“noteworthy litigation report”, which shall in any event include a report of all litigation,
actions, suits, arbitrations, investigations (including, without limitation, any of the foregoing
which are pending or threatened) or other legal or arbitrable proceedings affecting any of the
Borrowers, or any of their Affiliates or Property (including, without limitation, any Mortgage Loan
pledged to the Agent for the benefit of the Lender hereunder), before any Governmental Authority
(collectively, “Litigation Matters”) that (i) makes a claim or claims in an aggregate
amount greater than $5,000,000, (ii) is styled as a class action, (iii) individually or in the
aggregate, if adversely determined, could be reasonably likely to have a Material Adverse Effect or
(iv) requires filing with the Securities and Exchange Commission in accordance with the 1934 Act or
any rules thereunder. In addition, the Borrowers shall promptly, and in any event within ten (10)
days after service of process on any of the Borrowers or any of their Affiliates, give to the Agent
notice of any Litigation Matter that questions or challenges the validity or enforceability of any
of the Loan Documents or any action to be taken in connection with the transactions contemplated
hereby.

Section 7.03 Existence, etc. Each Borrower will:

(a) preserve and maintain its legal existence and all of its material rights, privileges,
licenses and franchises (provided, that nothing in this Section 7.03(a) shall prohibit any
transaction expressly permitted under Section 7.04 hereof);

(b) comply with the requirements of all applicable laws, rules, regulations and orders of
Governmental Authorities (including, without limitation, all Prescribed Laws, environmental laws
and all laws with respect to unfair and deceptive lending practices and Predatory Lending
Practices) if failure to comply with such requirements would be reasonably likely (either
individually or in the aggregate) to have a Material Adverse Effect;

(c) keep adequate records and books of account, in which complete entries will be made in
accordance with GAAP consistently applied;

(d) not change its jurisdiction of organization from the jurisdiction referred to in Section
6.11, unless it shall have provided the Agent 30 days’ prior written notice of such change;

(e) pay and discharge all taxes, assessments and governmental charges or levies imposed on it
or on its income or profits or on any of its Property prior to the date on which penalties attach
thereto, except for any such tax, assessment, charge or levy, the payment of which is being
contested in good faith and by proper proceedings and against which adequate reserves are being
maintained; and

(f) permit representatives of the Agent, during normal business hours, to examine, copy and
make extracts from its books and records, to inspect any of its Properties, and to discuss its
business and affairs with its officers, all to the extent reasonably requested by the Agent.

Section 7.04 Prohibition of Fundamental Changes. No Borrower shall enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up or dissolve itself
(or suffer any liquidation, winding up or dissolution) or sell all or substantially all of its
assets; provided, that each Borrower may merge or consolidate with (a) any wholly owned subsidiary
of such Borrower or (b) any other Person if such Borrower is the surviving corporation and such
Borrower’s Net Worth would not be affected by such merger or consolidation and provided further,
that if after giving effect thereto, no Default would exist hereunder.

Section 7.05 Borrowing Base Deficiency. If at any time there exists a Borrowing Base
Deficiency the Borrowers shall cure same in accordance with Section 2.07 hereof.

Section 7.06 Notices. The Borrowers shall give notice to the Agent:

(a) promptly upon receipt of notice or knowledge of the occurrence of any Default or Event of
Default;

(b) with respect to any Mortgage Loan pledged to the Agent, for the benefit of the Lender
hereunder, immediately upon receipt of any principal prepayment (in full or partial) of such
pledged Mortgage Loan;

(c) with respect to any Mortgage Loan pledged to the Agent, for the benefit of the Lender
hereunder, immediately upon receipt of notice or knowledge that the underlying Mortgaged Property
has been damaged by waste, fire, earthquake or earth movement, windstorm, flood, tornado or other
casualty, or otherwise damaged so as to affect adversely the Collateral Value of such pledged
Mortgage Loan;

(d) promptly upon receipt of notice or knowledge of (i) any default related to any Collateral,
(ii) any Lien or security interest (other than security interests created hereby or by the other
Loan Documents) on, or claim asserted against, any of the Collateral or (iii) any event or change
in circumstances which could reasonably be expected to have a Material Adverse Effect; and

(e) promptly upon any material change in the market value of any or all of each Borrower’s
assets.

Each notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer
of each Borrower setting forth details of the occurrence referred to therein and stating what
action the Borrowers have taken or propose to take with respect thereto.

Section 7.07 Reports. The Borrowers shall provide the Agent with a quarterly report,
which report shall include, among other items, (a) a summary of each Borrower’s delinquency and
loss experience with respect to mortgage loans serviced by any Borrower, any Servicer or any
designee of either, plus any such additional reports as the Agent may reasonably request with
respect to any Borrower’s or any Servicer’s servicing portfolio or pending originations of mortgage
loans and (b) a mark to market summary of any residual and/or subordinate securities held by any
Borrower.

Section 7.08 Underwriting Guidelines. Without the prior written consent of the
Lender, the Borrowers shall not materially amend or otherwise modify the Underwriting Guidelines
with respect to Mortgage Loans pledged under this Loan Agreement. Notwithstanding the preceding
sentence, in the event that any Borrower makes any amendment or modification to the Underwriting
Guidelines, (i) such Borrower shall promptly deliver to the Agent a complete copy of the amended or
modified Underwriting Guidelines and (ii) the Lender may, at its sole option and discretion,
refrain from funding any additional borrowings under Section 2.03 hereof with respect to Mortgage
Loans originated under the amended or modified Underwriting Guidelines, but not with respect to
Mortgage Loans that comply with the Underwriting Guidelines approved hereunder.

Section 7.09 Transactions with Affiliates. No Borrower will enter into any
transaction, including, without limitation, any purchase, sale, lease or exchange of property or
the rendering of any service, with any Affiliate unless such transaction is (a) otherwise permitted
under this Loan Agreement, (b) in the ordinary course of such Borrower’s business and (c) upon fair
and reasonable terms no less favorable to such Borrower than it would obtain in a comparable arm’s
length transaction with a Person which is not an Affiliate, or make a payment that is not otherwise
permitted by this Section 7.09 to any Affiliate. In no event shall any Borrower pledge to the
Agent, for the benefit of the Lender hereunder, any Mortgage Loan acquired by any Borrower from an
Affiliate of a Borrower.

Section 7.10 Limitation on Liens. The Borrowers will defend the Collateral against,
and will take such other action as is necessary to remove, any Lien, security interest or claim on
or to the Collateral, other than the security interests created under this Loan Agreement, and the
Borrowers will defend the right, title and interest of the Agent and the Lender in and to any of
the Collateral against the claims and demands of all persons whomsoever.

Section 7.11 Limitation on Guarantees. The Borrowers shall not create, incur, assume
or suffer to exist any Guarantees (provided that acting as a co-borrower with respect to credit
facilities entered into as the ordinary course of business shall not be deemed Guarantees.)

Section 7.12 Limitation on Distributions. After the occurrence and during the
continuation of any Default, no Borrower shall make any payment on account of, or set apart assets
for, a sinking or other analogous fund for the purchase, redemption, defeasance, retirement or
other acquisition of any equity or partnership interest of such Borrower, whether now or hereafter
outstanding, or make any other distribution in respect of any of the foregoing or to any
shareholder or equity owner of such Borrower, either directly or indirectly, whether in cash or
property or in obligations of such Borrower or any of such Borrower’s consolidated Subsidiaries,
except distributions in cash or other property to the extent required to satisfy the REIT
Distribution Requirement.

Section 7.13 Servicer; Servicing Tape. The Borrowers shall provide to the Agent on
the tenth (10th) Business Day of each month a computer readable file containing
servicing information, including, without limitation, those fields specified by the Agent from time
to time, on a loan-by-loan basis and in the aggregate, with respect to the Mortgage Loans serviced
hereunder by the Borrowers or any Servicer. The Borrowers shall not cause the Mortgage Loans to be
serviced by any servicer other than a servicer expressly approved in writing by the Agent.

Section 7.14 Required Filings. The Borrowers shall promptly provide the Agent with
copies of all documents which the Borrowers or any Affiliates of the Borrowers are required to file
with the Securities and Exchange Commission in accordance with the 1934 Act or any rules
thereunder.

Section 7.15 No Adverse Selection. The Borrowers have not selected the Collateral in
a manner so as to adversely affect the Lender’s interests.

Section 7.16 Remittance of Prepayments. The Borrowers shall remit, with sufficient
detail to enable the Agent to appropriately identify the Mortgage Loan to which any amount remitted
applies, to the Agent on each Remittance Date all principal prepayments that the Borrowers have
received since the prior Remittance Date.

ARTICLE VIII

EVENTS OF DEFAULT.

Section 8.01 Events of Default.

Each of the following events shall constitute an event of default (an “Event of
Default”) hereunder:

(a) any Borrower shall default in the payment of any principal of or interest on any Loan when
due (whether at stated maturity, upon acceleration or at mandatory or optional prepayment); or

(b) any Borrower shall default in the payment of any other amount payable by it hereunder or
under any other Loan Document after notification by the Agent of such default, and such default
shall have continued unremedied for five (5) Business Days; or

(c) any representation, warranty or certification made or deemed made herein or in any other
Loan Document by the Borrowers or any certificate furnished to the Agent pursuant to the provisions
hereof or thereof shall prove to have been false or misleading in any material respect as of the
time made or furnished (other than the representations and warranties set forth in Schedule
1, which shall be considered solely for the purpose of determining the Collateral Value of the
Mortgage Loans; unless (i) the Borrowers shall have made any such representations and warranties
with knowledge that they were materially false or-misleading at the time made or (ii) any such
representations and warranties have been determined by the Agent in its sole discretion to be
materially false or misleading on a regular basis); or

(d) any Borrower shall fail to comply with the requirements of Section 7.03(a), Section 7.04,
Section 7.05, Section 7.06, or Sections 7.09 through 7.16 hereof; or any Borrower shall otherwise
fail to comply with the requirements of Sections 7.03, 7.07 and 7.08 hereof and such default shall
continue unremedied for a period of five (5) Business Days; or the Borrowers shall fail to observe
or perform any other covenant or agreement contained in this Loan Agreement or any other Loan
Document and such failure to observe or perform shall continue unremedied for a period of seven (7)
Business Days; or

(e) a final judgment or judgments for the payment of money in excess of $1,500,000 in the
aggregate shall be rendered against any Borrower or any of its Material Affiliates by one or more
courts, administrative tribunals or other bodies having jurisdiction and the same shall not be
satisfied, discharged (or provision shall not be made for such discharge) or bonded, or a stay of
execution thereof shall not be procured, within thirty (30) days from the date of entry thereof,
and any Borrower or any such Material Affiliate shall not, within said period of thirty (30) days,
or such longer period during which execution of the same shall have been stayed or bonded, appeal
therefrom and cause the execution thereof to be stayed during such appeal; or

(f) any Borrower or any of its Material Affiliates shall admit in writing its inability to pay
its debts as such debts become due; or

(g) any Borrower or any of its Material Affiliates shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian, trustee, examiner or
liquidator or the like of itself or of all or a substantial part of its property, (ii) make a
general assignment for the benefit of its creditors, (iii) commence a voluntary case under the
Bankruptcy Code, (iv) file a petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, liquidation, dissolution, arrangement or winding-up, or
composition or readjustment of debts, (v) fail to controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition filed against it in an involuntary case under the Bankruptcy
Code or (vi) take any corporate or other action for the purpose of effecting any of the foregoing;
or

(h) a proceeding or case shall be commenced, without the application or consent of any
Borrower or any of its Material Affiliates, in any court of competent jurisdiction, seeking (i) its
reorganization, liquidation, dissolution, arrangement or winding-up, or the composition or
readjustment of its debts, (ii) the appointment of, or the taking of possession by, a receiver,
custodian, trustee, examiner, liquidator or the like of any Borrower or any such Affiliate or of
all or any substantial part of its property or (iii) similar relief in respect of any Borrower or
any such Affiliate under any law relating to bankruptcy, insolvency, reorganization, liquidation,
dissolution, arrangement or winding-up, or composition or adjustment of debts, and such proceeding
or case shall continue undismissed, or an order, judgment or decree approving or ordering any of
the foregoing shall be entered and continue unstayed and in effect, for a period of 30 or more
days; or an order for relief against any Borrower or any such Affiliate shall be entered in an
involuntary case under the Bankruptcy Code; or

(i) the Custodial Agreement or any Loan Document shall for whatever reason be terminated or
cease to be in full force and effect, or the enforceability thereof shall be contested by any
Borrower; or

(j) any Borrower shall grant, or suffer to exist, any Lien on any Collateral except the Liens
contemplated hereby; or the Liens contemplated hereby shall cease to be first priority perfected
Liens on the Collateral in favor of the Agent, for the benefit of the Lender, or shall be Liens in
favor of any Person other than the Agent; or

(k) any Borrower or any of any Borrower’s Material Affiliates shall be in default under any
note, indenture, loan agreement, guaranty, swap agreement or any other contract to which it is a
party in excess of $10,000,000, including, without limitation, any MS Indebtedness, which default
(i) involves the failure to pay a matured obligation or (ii) permits the acceleration of the
maturity of obligations by any other party to or beneficiary of such note, indenture, loan
agreement, guaranty, swap agreement or other contract; or

(l) any materially adverse change in the Property, business, financial condition or prospects
of any Borrower or any of its Material Affiliates shall occur, in each case as determined by the
Agent or the Lender in their sole discretion, or any other condition shall exist which, in the
Agent’s or the Lender’s sole discretion, constitutes a material impairment of any Borrower’s
ability to perform its obligations under this Loan Agreement, any Note or any other Loan Document;
or

(m) MS & Co.’s unsecured long-term debt rating has been lowered or downgraded to a rating
below “A-” by S&P or “A3” by Moody’s and any Borrower shall have failed to repay all amounts owing
to the Lender under this Agreement, the Notes and the other Loan Documents within ninety (90) days
following such downgrade; or

(n) the discovery by the Agent or the Lender of a condition or event which existed at or prior
to the execution hereof and which the Agent or the Lender in their sole discretion, determines
materially and adversely affects: (i) the condition (financial or otherwise) of any Borrower and
the Guarantor, their Subsidiaries or Affiliates; or (ii) the ability of any Borrower to fulfill
their respective obligations under this Loan Agreement; or

(o) any representation, warranty or certification made or deemed made in the New Century
Guaranty by the Guarantor shall prove to have been false or misleading in any material respect as
of the time made or furnished; or

(p) the Guarantor shall fail to observe or perform any covenant or agreement contained in
Section 11 of the New Century Guaranty; or

(q) any “Event of Default” shall have occurred under any other loan, repurchase or other
similar agreement involving $1,000,000 or more between any Borrower (or any Affiliate of any
Borrower) on the one hand and the Lender (or any Affiliate of the Lender) on the other hand.

ARTICLE IX

REMEDIES UPON DEFAULT.

Section 9.01 Remedies.

(a) An Event of Default shall be deemed to be continuing unless expressly waived in writing by
the Agent at the direction of the Lender. Upon the occurrence of one or more Events of Default
hereunder, the obligation of the Lender to make additional Loans to the Borrowers shall
automatically terminate without further action by any Person. Upon the occurrence of one or more
Events of Default other than those referred to in Sections (f), (g) and (h) of Article VIII, the
Agent may, at the direction of the Lender, immediately declare the principal amount of the Loans
then outstanding under the Notes to be immediately due and payable, together with all accrued and
unpaid interest thereon and fees and expenses accruing under this Loan Agreement. Upon the
occurrence of an Event of Default referred to in Sections (f), (g) and (h) of Article VIII, such
amounts shall immediately and automatically become due and payable without any further action by
any Person. Upon such declaration or such automatic acceleration, the balance then outstanding on
the Notes shall become immediately due and payable, without presentment, demand, protest or other
formalities of any kind, all of which are hereby expressly waived by the Borrowers.

(b) Upon the occurrence of a Default, the Agent and the Lender shall have the right to obtain,
and the Borrowers shall deliver or cause to be delivered, on demand, physical possession of the
Servicing Records and all other files of the Borrowers relating to the Collateral and all documents
relating to the Collateral which are then or may thereafter come in to the possession of the
Borrowers or any third parties acting for the Borrowers and the Borrowers shall deliver to the
Agent such assignments as the Agent shall request. The Agent and the Lender shall be entitled to
specific performance of all agreements of the Borrowers contained in this Loan Agreement.

ARTICLE X

THE AGENT.

Section 10.01 Appointment. The Lender hereby irrevocably designates and appoints
Morgan Stanley Mortgage Capital Inc., and Morgan Stanley Mortgage Capital Inc. hereby accepts such
designation and appointment, as the Agent of the Lender under this Loan Agreement and the other
Loan Documents, and the Lender irrevocably authorizes the Agent, in such capacity, to take such
action on its behalf under the provisions of this Loan Agreement and the other Loan Documents and
to exercise such powers and perform such duties as are expressly delegated to the Agent by the
terms of this Loan Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this
Loan Agreement, the Agent shall not have any duties or responsibilities, except those expressly set
forth herein, or any fiduciary relationship with the Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this Loan Agreement or any
other Loan Document or otherwise exist against the Agent.

Section 10.02 Delegation of Duties. The Agent may execute any of its duties under
this Agreement and the other Loan Documents by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties. The Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by
it with reasonable care.

Section 10.03 Exculpatory Provisions. Neither the Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates shall be (i) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in connection with this Loan
Agreement or any other Loan Document (except for its or such Person’s own gross negligence or
willful misconduct) or (ii) responsible in any manner to the Lender for any recitals, statements,
representations or warranties made by any Borrower or any officer thereof contained in this Loan
Agreement or any other Loan Document or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agent under or in connection with, this Loan
Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Loan Agreement or any other Loan Document or for any failure
of any Borrower to perform its obligations hereunder or thereunder. The Agent shall not be under
any obligation to the Lender to ascertain or to inquire as to the observance or performance of any
of the agreements contained in, or conditions of, this Loan Agreement or any other Loan Document,
or to inspect the properties, books or records of the Borrowers.

Section 10.04 Reliance by Agent. The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any Note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to each Borrower), independent accountants and other
experts selected by the Agent. The Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof
shall have been filed with the Agent. As between the Agent and the Lender, the Agent shall be
fully justified in failing or refusing to take any action under this Loan Agreement or any other
Loan Document unless it shall first receive such advice or concurrence of the Lender as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lender against any and all
liability and expense which may be incurred by it by reason of taking or continuing to take any
such action. As between the Agent and the Lender, the Agent shall in all cases be fully protected
in acting, or in refraining from acting, under this Loan Agreement and the other Loan Documents in
accordance with a request of the Lender, and such request and any action taken or failure to act
pursuant thereto shall be binding upon the Lender and all future holders of the Loans.

Section 10.05 Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder (other than under Section
8.01 hereof) unless the Agent has received notice from the Lender or any Borrower referring to this
Loan Agreement, describing such Default or Event of Default and stating that such notice is a
“notice of default”. In the event that the Agent receives such a notice, the Agent shall give
notice thereof to the Lender. The Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Lender; provided that unless and until the
Agent shall have received such directions, the Agent may (but shall not be obligated to) take such
action, or refrain from taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Lender.

Section 10.06 Non-Reliance on Agent and Lender. The Lender expressly acknowledges
that neither the Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by the Agent
hereinafter taken, including any review of the affairs of the Borrowers, shall be deemed to
constitute any representation or warranty by the Agent to the Lender. The Lender represents to the
Agent that it has, independently and without reliance upon the Agent, and based on such documents
and information as it has deemed appropriate, made its own appraisal of and investigation into the
business, operations, property, financial and other condition and creditworthiness of the Borrowers
and made its own decision to make its Loans hereunder and enter into this Loan Agreement. The
Lender also represents that it will, independently and without reliance upon the Agent, and based
on such documents and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action under this Loan
Agreement and the other Loan Documents, and to make such investigation as it deems necessary to
inform itself as to the business, operations, property, financial and other condition and
creditworthiness of any Borrower. Except for notices, reports and other documents expressly
required to be furnished by each Borrower to the Agent hereunder or under the other Loan Documents,
which the Agent must distribute promptly to the Lender, the Agent shall not have any duty or
responsibility to provide the Lender with any credit or other information concerning the business,
operations, property, condition (financial or otherwise), prospects or creditworthiness of any
Borrower which may come into the possession of the Agent or any of its officers, directors,
employees, attorneys-in-fact or Affiliates.

Section 10.07 Indemnification. The Lender agrees to indemnify the Agent in its
capacity as such (to the extent not reimbursed by the Borrowers and without limiting the obligation
of the Borrowers to do so), ratably according to its respective Credit Exposure Percentages in
effect on the date on which indemnification is sought, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time (including, without limitation, at any
time following the payment of the Loans) be imposed on, incurred by or asserted against the Agent
in any way relating to or arising out of, the Commitments, this Loan Agreement, any of the other
Loan Documents or any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by the Agent under or in
connection with any of the foregoing; provided that the Lender shall not be liable for the payment
of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting solely from the Agent’s gross negligence or
willful misconduct. The agreements in this Section shall survive the payment of the Loans and all
other amounts payable hereunder.

Section 10.08 Agent in Its Individual Capacity. The Agent and its Affiliates may make
loans to, accept deposits from and generally engage in any kind of business with the Borrowers as
though the Agent were not the Agent hereunder and under the other Loan Documents. With respect to
the Loans made by it, the Agent shall have the same rights, powers and obligations under this Loan
Agreement and the other Loan Documents as the Lender and may exercise the same as though it were
not the Agent, and the term “Lender” shall include the Agent in its individual capacity.

Section 10.09 Successor Agent. The Agent may resign as Agent upon forty-two (42)
days’ notice to the Lender and to the Borrowers. If the Agent shall resign as Agent under this
Loan Agreement and the other Loan Documents, then the Lender shall appoint a successor Agent for
the Lender, which successor Agent shall be approved by the Borrowers (unless an Event of Default
has occurred and is continuing), and any such successor Agent shall succeed to the rights, powers
and duties of the Agent, and the term “Agent” shall mean such successor Agent effective upon such
appointment and approval, and the former Agent’s rights, powers and duties as Agent shall be
terminated, without any other or further act or deed on the part of such former Agent or any of the
parties to this Loan Agreement or any holders of the Loans and Notes. If no successor Agent has
been appointed and shall have accepted such appointment within 30 days after the retiring Agent’s
giving notice of its resignation, then the retiring Agent, on behalf of the Lender, may appoint an
Agent which shall (unless an Event of Default has occurred and is continuing) be reasonably
acceptable to the Borrowers. Upon the acceptance of any appointment as the Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations, under this Loan Agreement and the other Loan Documents.
After any retiring Agent’s resignation as Agent, the provisions of this Article X shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Loan
Agreement and the other Loan Documents.

ARTICLE XI

MISCELLANEOUS.

Section 11.01 Waiver. No failure on the part of the Agent or the Lender to exercise
and no delay in exercising, and no course of dealing with respect to, any right, power or privilege
under any Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise
of any right, power or privilege under any Loan Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.

Section 11.02 Notices. Except as otherwise expressly permitted by this Loan
Agreement, all notices, requests and other communications provided for herein and under the
Custodial Agreement (including without limitation any modifications of, or waivers, requests or
consents under, this Loan Agreement) shall be given or made in writing (including without
limitation by telex or telecopy) delivered to the intended recipient at the “Address for Notices”
specified below its name on the signature pages hereof or thereof); or, as to any party, at such
other address as shall be designated by such party in a written notice to each other party
provided, that a copy of all notices given under Section 7.01 shall simultaneously be delivered to
Credit Department, Morgan Stanley, 1221 Avenue of the Americas, 35th Floor, Attention: Patrick
Romaine. Except as otherwise provided in this Loan Agreement and except for notices given under
Article II (which shall be effective only on receipt), all such communications shall be deemed to
have been duly given when transmitted by telex or telecopy or personally delivered or, in the case
of a mailed notice, upon receipt, in each case given or addressed as aforesaid.

In addition to the notices and communications provided for in the Loan Agreement, the Agent
shall (i) receive from the Borrowers and transmit to the Lender all notices and communications
required to be delivered by the Borrowers under any Loan Document, including without limitation,
all communications relating to requests for amendments, terminations, borrowing requests, waivers,
Defaults, Events of Default, required reporting, suits or proceedings, breaches of any
representations or warranties and delegation of duties and (ii) receive from the Lender and
transmit to the Borrowers all notices and communications required to be delivered by the Lender
under any Loan Document, including without limitation, all communications relating to requests for
amendments, terminations, borrowing requests, waivers, Defaults, Events of Default, required
reporting, suits or proceedings, breaches of any representations or warranties and delegation of
duties. Furthermore, the Borrowers shall copy the Lender on all communications and notices
directed to the Agent and shall copy the Agent on all communications and notices directed to the
Lender.

Section 11.03 Indemnification and Expenses. The Borrowers agree to hold the Agent,
the Lender and each of their respective Affiliates and their officers, directors, employees, agents
and advisors (each an “Indemnified Party”) harmless from and indemnify any Indemnified
Party against all liabilities, losses, damages, judgments, costs and expenses of any kind which may
be imposed on, incurred by or asserted against such Indemnified Party (collectively, the
“Costs”) relating to or arising out of this Loan Agreement, any Note, any other Loan
Document or any transaction contemplated hereby or thereby, or any amendment, supplement or
modification of, or any waiver or consent under or in respect of, this Loan Agreement, any Note,
any other Loan Document or any transaction contemplated hereby or thereby (including, without
limitation, any Takeout Proceeds Identification Letter), that, in each case, results from anything,
other than any Indemnified Party’s gross negligence, bad faith or willful misconduct. Without
limiting the generality of the foregoing, the Borrowers agree to hold any Indemnified Party
harmless from and indemnify such Indemnified Party against all Costs with respect to all Mortgage
Loans relating to or arising, out of any violation or alleged violation of any environmental law,
rule or regulation or any consumer credit laws, including without limitation, laws with respect to
unfair or deceptive lending practices or Predatory Lending Practices, the Truth in Lending Act
and/or the Real Estate Settlement Procedures Act, that, in each case, results from anything other
than such Indemnified Party’s gross negligence, bad faith or willful misconduct. In any suit,
proceeding or action brought by an Indemnified Party in connection with any Mortgage Loan for any
sum owing thereunder, or to enforce any provisions of any Mortgage Loan, the Borrowers will save,
indemnify and hold such Indemnified Party harmless from and against all expense, loss or damage
suffered by reason of any defense, set-off, counterclaim, recoupment or reduction or liability
whatsoever of the account debtor or obligor thereunder, arising out of a breach by the Borrowers of
any obligation thereunder or arising out of any other agreement, indebtedness or liability at any
time owing to or in favor of such account debtor or obligor or its successors from the Borrowers.
The Borrowers also agree to reimburse an Indemnified Party as and when billed by such Indemnified
Party for all such Indemnified Party’s costs and expenses incurred in connection with the
enforcement or the preservation of such Indemnified Party’s rights under this Loan Agreement, any
Note, any other Loan Document or any transaction contemplated hereby or thereby, including, without
limitation, the reasonable fees and disbursements of its counsel. The Borrowers hereby acknowledge
that, notwithstanding the fact that each Note is secured by the Collateral, the obligation of the
Borrowers under the Notes is a recourse obligation of the Borrowers.

The Borrowers agree to pay as and when billed by the Agent all of the out-of-pocket costs and
expenses incurred by the Agent in connection with the development, preparation and execution of,
and any amendment, supplement or modification to, this Loan Agreement, the Notes, any other Loan
Document or any other documents prepared in connection herewith or therewith, including the New
Century Guaranty. The Borrowers agree to pay as and when billed by the Agent all of the
out-of-pocket costs and expenses incurred in connection with the consummation and administration of
the transactions contemplated hereby and thereby including, without limitation, (i) all the
reasonable and documented fees, disbursements and expenses of counsel to the Agent, (ii) all the
due diligence, inspection, testing and review costs and expenses incurred by the Agent with respect
to Collateral under this Loan Agreement, including, but not limited to, those costs and expenses
incurred by the Agent pursuant to Sections 11.03, 11.14 and 11.15 hereof and (iii) except to the
extent amounts in respect thereof have previously paid pursuant to Section 2.03, the costs of
Broker Price Opinions in respect of Defaulted Mortgage Loans.

Section 11.04 Amendments and Waivers. Neither this Loan Agreement nor any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or modified except in
accordance with the provisions of this Section 11.04. The Lender may, or, with the written consent
of the Lender, the Agent may, from time to time, (a) enter into with the Borrowers written
amendments, supplements or modifications hereto and to the other Loan Documents for the purpose of
adding any provisions to this Loan Agreement or the other Loan Documents or changing in any manner
the rights of the Lender or of the Borrowers hereunder or thereunder or (b) waive, on such terms
and conditions as the Lender or the Agent, as the case may be, may specify in such instrument, any
of the requirements of this Loan Agreement or the other Loan Documents or any Default or Event of
Default and its consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall:

(i) reduce the amount or extend the scheduled date of maturity of any Loan or of any
installment thereof, or reduce the stated rate of any interest or fee payable hereunder or extend
the scheduled date of any payment thereof or increase the amount or extend the expiration date of
the Lender’s Commitment, in each case without the consent of the Lender, or

(ii) amend, modify or waive any provision of this Section 11.04 or consent to the assignment
or transfer by any Borrower of any of its rights and obligations under this Loan Agreement and the
other Loan Documents or release all or substantially all of the Collateral (except in accordance
with this Loan Agreement upon repayment of all amounts owing under the Loan Documents in respect of
such Collateral) or release the Guarantor from its obligations under the New Century Guaranty, in
each case without the written consent of the Lender directly affected thereby, or

(iii) amend, modify or waive any provision of Article X without the written consent of the
then Agent;

provided, that any waiver, amendment, supplement or modification shall apply equally
to the Lender and shall be binding upon the Borrowers, the Lender, the Agent and all future holders
of the Loans and, in the case of any waiver, the Borrowers, the Lender and the Agent shall be
restored to their former positions and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not continuing, but no such
waiver shall extend to any subsequent or other Default or Event of Default or impair any right
consequent thereon.

Section 11.05 Assignments and Participations. (a) Subject to the approval of the
Borrowers, which approval shall not be unreasonably withheld (provided that such approval
shall not be required with respect to an assignment to any Affiliate of the Lender, any sale,
assignment or transfer pursuant to Section 11.05(f), or if any Event of Default shall have
occurred and is continuing) the Lender may assign and delegate to one or more Persons all or a
portion of its rights and obligations under this Loan Agreement; provided,
further, that none of the costs incurred by the assigning Lender or its assignee in
connection therewith shall be borne by the Borrowers and the parties to each such assignment
shall execute and deliver an Assignment and Acceptance substantially in the form of Exhibit
I, with appropriate completions (an “Assignment and Acceptance”), along with
replacement Notes executed and delivered by the Borrowers.

(b) Upon such execution and delivery, from and after the effective date specified in such
Assignment and Acceptance, (i) the assignee thereunder shall be a party hereto and, to the extent
that rights and obligations hereunder have been assigned and delegated to it pursuant to such
Assignment and Acceptance, have the rights and obligations of the Lender hereunder, and (ii) the
Lender assignor thereunder shall, to the extent that any rights and obligations hereunder have been
assigned and delegated by it, and accepted and assumed by the assignee pursuant to such Assignment
and Acceptance, relinquish its rights and be released from its obligations under this Loan
Agreement.

(c) The Lender may sell participations to one or more Persons in or to all or a portion of its
rights and obligations under this Loan Agreement; provided, however, that (i) the
Lender’s obligations under this Loan Agreement shall remain unchanged, (ii) the Lender shall remain
solely responsible to the other parties hereto for the performance of such obligations, (iii) the
Lender shall remain the holder of any such Note for all purposes of this Loan Agreement; and (iv)
the Borrowers shall, to the extent otherwise required by this Loan Agreement, continue to deal
solely and directly with the Lender in connection with the Lender’s rights and obligations under
and in respect of this Loan Agreement and the other Loan Documents. Notwithstanding the terms of
Section 3.03, each participant of the Lender shall be entitled to the additional compensation and
other rights and protections afforded the Lender under Section 3.03 to the same extent as the
Lender would have been entitled to receive them with respect to the participation sold to such
participant.

(d) The Lender may, in connection with any assignment or participation or proposed assignment
or participation pursuant to this Section 11.05, disclose to the assignee or participant or
proposed assignee or participant, as the case may be, any information relating to the Borrowers or
any of their Subsidiaries or to any aspect of the Loans that has been furnished to the Lender by or
on behalf of the Borrowers or any of their Subsidiaries; provided that such assignee or
participant agrees to hold such information confidential pursuant to a written agreement
substantially similar to the existing agreement between the Lender and the Borrowers and provided
that such proposed assignee or participant is not a competitor of any Borrower.

(e) The Lender may at any time create a security interest in all or any portion of its rights
under this Loan Agreement (including, without limitation, the Loans owing to it and the Note held
by it) in favor of any Federal Reserve Bank in accordance with Regulation A of the Board of
Governors of the Federal Reserve System and any Operating Circular issued by such Federal Reserve
Bank. No such assignment shall release the assigning Lender from its obligations hereunder.

Section 11.06 Survival. The obligations of the Borrowers under Sections 3.03 and
11.03 hereof shall survive the repayment of the Loans and the termination of this Loan Agreement.
In addition, each representation and warranty made or deemed to be made by a request for a
borrowing, herein or pursuant hereto shall survive the making of such representation and warranty,
and the Lender shall not be deemed to have waived, by reason of making, any Loan, any Default that
may arise because any such representation or warranty shall have proved to be false or misleading,
notwithstanding that the Lender may have had notice or knowledge or reason to believe that such
representation or warranty was false or misleading at the time such Loan was made.

Section 11.07 Captions. The table of contents and captions and section headings
appearing herein are included solely for convenience of reference and are not intended to affect
the interpretation of any provision of this Loan Agreement.

Section 11.08 Counterparts. This Loan Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same instrument, and any of
the parties hereto may execute this Loan Agreement by signing any such counterpart.

Section 11.09 Loan Agreement Constitutes Security Agreement; Governing LawThis Loan
Agreement shall be governed by, and construed and interpreted in accordance with, the laws of the
State of New York, and shall constitute a security agreement within the meaning of the Uniform
Commercial Code.

Section 11.10 Submission To Jurisdiction; Waivers. Each Borrower hereby irrevocably
and unconditionally:

SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS LOAN
AGREEMENT, THE NOTES AND THE OTHER LOAN DOCUMENTS, OR FOR RECOGNITION AND ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW
YORK, AND APPELLATE COURTS FROM ANY THEREOF;

CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO THE EXTENT
PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN
INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME;

AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY MAILING A
COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE
PREPAID, TO ITS ADDRESS SET FORTH UNDER ITS SIGNATURE BELOW OR AT SUCH OTHER ADDRESS OF WHICH THE
AGENT SHALL HAVE BEEN NOTIFIED; AND

AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION.

Section 11.11 WAIVER OF JURY TRIAL. EACH OF THE LENDER, THE BORROWERS AND THE AGENT
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS LOAN AGREEMENT, ANY OTHER
LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

Section 11.12 Acknowledgments. Each Borrower hereby acknowledges that:

(a) it has been advised by counsel in the negotiation, execution and delivery of this Loan
Agreement, the Notes and the other Loan Documents;

(b) the Lender does not have any fiduciary relationship to any Borrower, and the relationship
between each Borrower and the Lender is solely that of debtor and creditor; and

(c) no joint venture exists between the Lender and any Borrower.

Section 11.13 Hypothecation or Pledge of Loans. The Agent, acting at the direction of
the Lender, shall have free and unrestricted use of all Collateral and nothing in this Loan
Agreement shall preclude the Agent from engaging in repurchase transactions with the Collateral or
otherwise pledging, repledging, transferring, hypothecating, or rehypothecating the Collateral.
Nothing contained in this Loan Agreement shall obligate the Agent to segregate any Collateral
delivered to the Agent by the Borrowers.

Section 11.14 Servicing.

(a) Each Borrower covenants to maintain or cause the servicing of the Mortgage Loans to be
maintained in conformity with accepted and prudent servicing practices in the industry for the same
type of mortgage loans as the Mortgage Loans and in a manner at least equal in quality to the
servicing such Borrower provides for mortgage loans which it owns. In the event that the preceding
language is interpreted as constituting one or more servicing contracts, each such servicing
contract shall terminate automatically upon the earliest of (i) an Event of Default, (ii) the date
on which all the Secured Obligations have been paid in full or (iii) the transfer of servicing
approved by the Agent in writing. The Agent hereby approves New Century as the initial servicer
(the “Initial Servicer”) of the Mortgage Loans.

(b) If the Mortgage Loans are serviced by New Century, (i) New Century agrees that the Agent
is the collateral assignee of all servicing records, including, but not limited to, any and all
servicing agreements, files, documents, records, data bases, computer tapes, copies of computer
tapes, proof of insurance coverage, insurance policies, appraisals, other closing documentation,
payment history records, and any other records relating to or evidencing the servicing of Mortgage
Loans (the “Servicing Records”), and (ii) New Century grants the Agent, for the benefit of
the Lender, a security interest in all servicing fees and rights relating to the Mortgage Loans and
all Servicing Records to secure the obligation of New Century or its designee to service in
conformity with this Section and any other obligation of New Century to the Lender. New Century
covenants to safeguard such Servicing Records and to deliver them promptly to the Agent or its
designee (including the Custodian) at the Agent’s request.

(c) If the Mortgage Loans are serviced by a third party servicer (such third party servicer,
the “Third Party Servicer”) the Borrowers (i) shall provide a copy of the servicing
agreement to the Agent, which shall be in form and substance acceptable to the Agent (the
“Servicing Agreement”), and (ii) shall provide a Servicer Notice to the Third Party
Servicer substantially in the form of Exhibit G hereto (a “Servicer Notice”) and
shall cause such Third Party Servicer to acknowledge and agree to the same. Any successor or
assignee of a Third Party Servicer shall be approved in writing by the Agent and shall acknowledge
and agree to a Servicer Notice prior to such successor’s assumption of servicing obligations with
respect to the Mortgage Loans.

(d) If the Servicer of the Mortgage Loans is a Borrower or an Affiliate of a Borrower, such
Borrower shall provide to the Agent a letter to the effect that upon the occurrence of an Event of
Default, the Agent may terminate any Servicing Agreement and in any event transfer servicing to the
Agent’s designee, at no cost or expense to the Agent, it being agreed that such Borrower will pay
any and all fees required to terminate the Servicing Agreement and to effectuate the transfer of
servicing to the designee of the Agent.

(e) After the Funding Date, until the pledge of any Mortgage Loan is relinquished by the
Custodian, (i) the Borrowers shall give prior written notice to the Agent of any proposed
modification or alteration to the terms of any such Mortgage Loan and unless the Borrowers shall
have received the Agent’s written approval of such modification or alteration within five (5)
Business Days thereafter, in the event the Borrowers nevertheless make such modification or
alteration to the terms of such Mortgage Loan thereafter, such Mortgage Loan shall thereupon have a
Collateral Value equal to zero, and (ii) the Borrowers will have no obligation or right to
repossess such Mortgage Loan or substitute another Mortgage Loan, except as provided in the
Custodial Agreement.

(f) In the event any Borrower or its Affiliate is servicing the Mortgage Loans, such Borrower
shall permit the Agent from time to time during business hours and upon prior reasonable notice
(provided, that if a Default shall have occurred and be continuing, no such notice shall be
required) to inspect the Borrower’s or its Affiliate’s servicing facilities, as the case may be,
for the purpose of satisfying the Agent that such Borrower or its Affiliate, as the case may be,
has the ability to service the Mortgage Loans as provided in this Loan Agreement.

Section 11.15 Due Diligence Review.

(a) Mortgage Loans. The Borrowers acknowledge that the Agent has the right to perform
continuing due diligence reviews with respect to the Mortgage Loans, for purposes of verifying
compliance with the representations, warranties and specifications made hereunder or otherwise, and
the Borrowers agree that upon reasonable (but no less than one (1) Business Day’s) prior notice to
the Borrowers or the Servicer, as the case may be, the Agent or its authorized representatives will
be permitted during normal business hours to examine, inspect, and make copies and extracts of, the
Mortgage Files and Servicing Records and any and all documents, records, agreements, instruments or
information relating to such Mortgage Loans in the possession or under the control of the
Borrowers, the Servicer and/or the Custodian. The Borrowers also shall make available to the Agent
a knowledgeable financial or accounting, officer for the purpose of answering questions respecting
the Mortgage Files and the Mortgage Loans. Without limiting the generality of the foregoing, the
Borrowers acknowledge that the Agent may make Loans to the Borrowers based solely upon the
information provided by the Borrowers to the Agent in the Mortgage Loan Data File and the
representations, warranties and covenants contained herein, and that the Agent, at its option, has
the right at any time to conduct a partial or complete due diligence review on some or all of the
Mortgage Loans securing such Loan, including without limitation ordering new credit reports and new
appraisals on the related Mortgaged Properties and otherwise re-generating the information used to
originate such Mortgage Loan. The Agent may underwrite such Mortgage Loans itself or engage a
mutually agreed upon third party underwriter to perform such underwriting. The Borrowers agree to
cooperate with the Agent and any third party underwriter in connection with such underwriting,
including, but not limited to, providing the Agent and any third party underwriter with access to
any and all documents, records, agreements, instruments or information relating to such Mortgage
Loans in the possession, or under the control, of any Borrower.

(b) Borrowers. Each Borrower acknowledges that the Agent has the right to perform
quarterly due diligence reviews of each Borrower’s operations, including, but not limited to, a
review of (1) the financial condition of the Borrowers, (2) loan origination and servicing
guidelines, and (3) other corporate due diligence matters at the discretion of the Agent. In
connection therewith, the Borrowers agree that upon reasonable (but no less than two (2) Business
Day’s) prior notice to the Borrowers (provided, that if a Default has occurred and is continuing,
no such notice shall be required), the Agent or its authorized representatives will be permitted
during normal business hours to examine, inspect, and make copies and extracts of all documents,
records, agreements, instruments or information relating to the Borrowers which are in possession
or under the control of the Borrowers, as the Agent may reasonably request. The Borrowers shall
also make available to the Agent a knowledgeable financial or accounting officer for the purpose of
answering questions respecting the financial condition of the Borrowers and make available to the
Agent an officer of each Borrower for the purpose of answering questions respecting other corporate
due diligence matters.

(c) Fees and Expenses of Due Diligence Review. The Borrowers further agree that the
Borrowers shall reimburse the Agent and the Lender for any and all out-of-pocket costs and expenses
incurred by the Agent or the Lender in connection with the Agent’s or the Lender’s activities
pursuant to this Section 11.15, subject to the limitation set forth in Section 11.03.

Section 11.16 Set-Off. In addition to any rights and remedies of the Lender provided
by this Loan Agreement and by law, the Lender shall have the right, without prior notice to the
Borrowers, any such notice being expressly waived by the Borrowers to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrowers hereunder (whether at the
stated maturity, by acceleration or otherwise) to set-off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by the
Lender or any Affiliate thereof to or for the credit or the account of any Borrower. The Lender
agrees promptly to notify the Borrowers after any such set-off and application made by the Lender;
provided, that the failure to give such notice shall not affect the validity of such set-off and
application.

Section 11.17 Intent. The parties recognize that each Loan is a “securities contract”
as that term is defined in Section 741 of Title 11 of the United States Code, as amended.

Section 11.18 Joint and Several LiabilityEach Borrower hereby acknowledges and agrees
that such Borrower shall be jointly and severally liable to the Lender to the maximum extent
permitted by applicable law for all representations, warranties, covenants, obligations and
indemnities of the Borrowers hereunder.

Section 11.19 Replacement by Repurchase Agreement. Each Borrower hereby acknowledges
and agrees that this Loan Agreement may, at any time and without any further cost to the Borrowers,
in the discretion of the Agent (with the consent of the Lender), be replaced by a repurchase
facility with substantially similar terms as those contained in this Loan Agreement. Each Borrower
hereby agrees to take such action and execute such documents and instruments as is necessary to
effectuate such conversion.

Section 11.20 Treatment of Certain Information. Notwithstanding anything to the
contrary contained herein or in any other Loan Document, all Persons may disclose to any and all
Persons, without limitation of any kind, the federal income tax treatment of the Loans or any of
the transactions contemplated by this Agreement or any other Loan Document (collectively, the
“Transactions”), any fact relevant to understanding the federal tax treatment of the
Transactions and all materials of any kind (including opinions or other tax analyses) relating to
such federal income tax treatment; provided, that, except as otherwise required by law,
rule or regulation, no Person may disclose the name of or identifying information with respect to
any party identified herein or in any other Loan Document or any pricing terms (including, without
limitation, the Applicable Margin and any structuring or other fees) or other nonpublic business or
financial information (including Collateral Value and financial covenants) that is unrelated to the
purported or claimed federal income tax treatment of the Transactions and is not relevant to
understanding the purported or claimed federal income tax treatment of the transaction, without the
prior consent of the Agent.

Section 11.21 Successors and Assigns. This Loan Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and permitted assigns.

[SIGNATURES FOLLOW]

1

IN WITNESS WHEREOF, the parties hereto have caused this Loan
Agreement to be duly executed and delivered as of the day and year first above written.

	 	 	 	NC
CAPITAL CORPORATION, as a Borrower

	 	 	 	By:
/s/ Kevin Cloyd

Name: Kevin Cloyd

Title: President

	 	 	 	Address for Notices:

18400 Von Karman, Suite 1000

Irvine, California 92612

Attention: Ralph Flick

Telecopier No.: (949) 440-7033

Telephone No.: (949) 225-7817

	 	 	 	NEW
CENTURY MORTGAGE CORPORATION, as a Borrower

	 	 	 	By:
/s/ Kevin Cloyd

Name: Kevin Cloyd

Title: Executive Vice President

	 	 	 	Address for Notices:

18400 Von Karman, Suite 1000

Irvine, California 92612

Attention: Ralph Flick

Telecopier No.: (949) 440-7033

Telephone No.: (949) 225-7817

2

	 	 	 	NC
RESIDUAL II CORPORATION, as a Borrower

	 	 	 	By:
/s/ Kevin Cloyd

Name: Kevin Cloyd

Title: Executive Vice President

	 	 	 	Address for Notices:

18400 Von Karman, Suite 1000

Irvine, California 92612

Attention: Ralph Flick

Telecopier No.: (949) 440-7033

Telephone No.: (949) 225-7817

	 	 	 	NEW
CENTURY CREDIT CORPORATION, as a Borrower

	 	 	 	By:
/s/ Kevin Cloyd

Name: Kevin Cloyd

Title: Executive Vice President

	 	 	 	Address for Notices:

18400 Von Karman, Suite 1000

Irvine, California 92612

Attention: Ralph Flick

Telecopier No.: (949) 440-7033

Telephone No.: (949) 225-7817

3

	 	 	 	MORGAN STANLEY MORTGAGE CAPITAL INC., as Lender
and Agent

	 	 	 	By:
/s/ Paul J. Najarian

Name: Paul J. Najarian

Title: Vice President

	 	 	 	Address for Notices:

1221 Avenue of the Americas

27th Floor

New York, New York 10020

Attention: Andy Neuberger

Telecopier No.: (212) 762-9495

Telephone No.: (212) 762-6401

4EX-10.2

Exhibit 10.2

GUARANTY

GUARANTY, dated as of November 15, 2005 (as amended, restated, supplemented or otherwise
modified and in effect from time to time, this “Guaranty”), is made and entered upon the
terms hereinafter set forth by NEW CENTURY FINANCIAL CORPORATION, a corporation duly incorporated
and in good standing in the State of Maryland (the “Guarantor”), in favor of MORGAN STANLEY
MORTGAGE CAPITAL INC. (the “Lender” and the “Beneficiary”), pursuant to that
certain Master Loan and Security Agreement, dated as of November 15, 2005 (as amended, restated,
supplemented or otherwise modified and in effect from time to time, the “Loan Agreement”),
by and among NC Capital Corporation (“NC Capital”), New Century Mortgage Corporation
(“New Century”), NC Residual II Corporation (“NC Residual”), New Century Credit
Corporation (“NC Credit”, together with NC Capital, New Century and NC Residual,
collectively, the “Borrowers”, each, a “Borrower”), the Lender and MORGAN STANLEY
MORTGAGE CAPITAL INC., as agent (in such capacity, the “Agent”).

RECITALS

WHEREAS, the Borrowers, the Lender and the Agent are parties to the Loan Agreement;

WHEREAS, the Borrowers are members of an affiliated group of entities that includes the
Guarantor; and

WHEREAS, it is a condition precedent to the making of the initial Loan to NC Credit under the
Loan Agreement that the Guarantor shall have executed and delivered this Guaranty.

NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration,
the receipt and sufficiency of which hereby are acknowledged by the Guarantor, the Guarantor hereby
agrees as follows:

Section 1. Definitions. Capitalized terms used but not defined herein shall have the
meanings specified in the Loan Agreement.

Section 2. Guarantee. The Guarantor hereby unconditionally and absolutely guarantees
to the Beneficiary and their respective successors and assigns the full and prompt payment of all
amounts due and owing by the Borrowers under the Loan Agreement, as and when they shall become due
thereunder (the “Guaranteed Obligations”). This is a guaranty of payment and not of
collection. The liability of the Guarantor hereunder shall be direct and immediate and not
conditional or contingent upon the occurrence of any event.

If at any time any amounts that shall have become due and payable under the Loan Agreement
(including but not limited to, (i) interest, default interest and principal payments required under
Section 2.06 thereof, (ii) the amount required to cure a Borrowing Base Deficiency under Section
2.07 thereof, (iii) any Minimum Usage Fee due pursuant to Section 7.18 thereof, and (iv)
indemnification payments and out-of-pocket expenses incurred pursuant to Section 11.03 and Section
11.15 thereof) and the Borrowers shall not have delivered full and timely payment to the
Beneficiary as required by the Loan Agreement, such Beneficiary, or the Agent on behalf of the
Beneficiary, shall notify the Guarantor in writing (which may be by telecopy confirmed by a
telephone call as described below) of the amounts that remain due and unpaid (the “Shortfall
Amount”). The Guarantor shall deliver the Shortfall Amount to the Agent, for the benefit of
the applicable Beneficiary, in immediately available funds no later than one (1) Business Day after
such notice is received.

Section 3. Obligations Unconditional. The obligations of the Guarantor under Section
2 hereof are absolute and unconditional irrespective of the value, genuineness, validity,
regularity or enforceability of the Loan Agreement or any other agreement or instrument referred to
herein or therein, or any substitution, release or exchange of any other guarantee of the
Guaranteed Obligations, and, to the fullest extent permitted by applicable law, irrespective of any
other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or
defense of a surety or guarantor (other than any payments made by the Borrowers, but subject to the
provisions of Section 4). Without limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or impair the liability of the
Guarantor hereunder which shall remain absolute and unconditional as described above:

(i) at any time or from time to time, without notice to the Guarantor, the time for any
performance of or the compliance with any of the Guaranteed Obligations shall be extended, or such
performance or compliance shall be waived;

(ii) any of the acts mentioned in any of the provisions of the Loan Agreement or any other
agreement or instrument referred to herein or therein shall be done or omitted (other than any
payments made by the Borrowers, but subject to the provisions of Section 4);

(iii) the maturity of any of the Guaranteed Obligations shall be accelerated, or any
Guaranteed Obligations due and unpaid shall be modified, supplemented or amended in any respect, or
any right under the Loan Agreement or any other agreement or instrument referred to herein or
therein shall be waived or any other guarantee of any of the obligations hereunder or any security
therefor shall be released or exchanged in whole or in part or otherwise dealt with; or

(iv) any lien or security interest granted to, or in favor of the Agent for the benefit of the
Lender or the Custodian, as the case may be, as security for any of the Guaranteed Obligations
shall fail to be perfected.

The Guarantor hereby expressly waives diligence, presentment, demand of payment and protest
whatsoever, and any requirement that the Beneficiary exhaust any right, power or remedy or proceed
against any Borrower under the Loan Agreement or any other agreement or instrument referred to
herein or therein, or against any other Person under any other guarantee of any of the obligations
guaranteed hereunder.

Section 4. Reinstatement. The obligations of the Guarantor shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf of any Borrower in
respect of the Guaranteed Obligations is rescinded or must be otherwise restored by any holder of
any of the Guaranteed Obligations, whether as a result of any proceeding under the Bankruptcy Code
or similar law (“Debtor Relief Law”) and the Guarantor agrees that it will indemnify each
of the Beneficiaries on demand for all reasonable costs and expenses (including, without
limitation, fees of counsel) incurred by any Beneficiary in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against any claim alleging
that such payment constituted a preference, fraudulent transfer or similar payment under a Debtor
Relief Law.

Section 5. Subrogation. Until such time as the Note is paid in full, the Guarantor
hereby waives all rights of subrogation or contribution, whether arising by contract or operation
of law (including, without limitation, any such right arising under a Debtor Relief Law) by reason
of any payment by it pursuant to the provisions of this Guaranty.

Section 6. Remedies. The Guarantor agrees that, as between the Guarantor and each of
the Beneficiary, the obligations of the Borrowers under the Loan Agreement may be declared to be
forthwith due and payable as provided therein (and shall be deemed to have become automatically due
and payable pursuant thereto) for purposes of Section 2 hereof, notwithstanding any stay,
injunction or other prohibition preventing such declaration (or such obligations from becoming
automatically due and payable) as against any Borrower and that, in the event of such declaration
(or such obligations being deemed to have become automatically due and payable), such obligations
(whether or not due and payable by the Borrowers) shall forthwith become due and payable by the
Guarantor.

Section 7. Instrument for the Payment of Money. To the extent permitted by applicable
law, the Guarantor hereby acknowledges that the guaranty provided herein constitutes an instrument
for the payment of money, and consents and agrees that each Beneficiary, at such Beneficiary’s sole
option, in the event of a dispute by the Guarantor in the payment of any moneys due hereunder,
shall have the right to bring motion-action under New York CPLR Section 3213.

Section 8. Continuing Guarantee. The guarantee provided herein is a continuing
guarantee, and shall apply to all Guaranteed Obligations whenever or however arising and shall
survive the termination of the Loan Agreement.

Section 9. General Limitation on Guaranteed Obligations. In any action or proceeding
involving any state, corporate law, or any state or Federal bankruptcy, insolvency, reorganization
or other law affecting the rights of creditors generally, if the Guaranteed Obligations would
otherwise be held or determined to be void, invalid or unenforceable, or subordinated to the claims
of any other creditors, on account of the amount of its liability hereunder, then, notwithstanding
any other provision hereof to the contrary, the amount of such liability shall, without any further
action by the Guarantor or any other Person, be automatically limited and reduced to the highest
amount that is valid and enforceable and not subordinated to the claims of other creditors as
determined in such action or proceeding.

Section 10. Representations and Warranties.

(i) Existence. The Guarantor (a) is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization, (b) has all requisite
corporate or other power, and has all governmental licenses, authorizations, consents and approvals
necessary to own its assets and carry on its business as now being or as proposed to be conducted,
except where the lack of such licenses, authorizations, consents and approvals would not be
reasonably likely to have a Material Adverse Effect, and (c) is qualified to do business and is in
good standing in all other jurisdictions in which the nature of the business conducted by it makes
such qualification necessary, except where failure so to qualify would not be reasonably likely
(either individually or in the aggregate) to have a Material Adverse Effect.

(ii) Financial Condition. The Guarantor has heretofore furnished to the Agent a copy
of its consolidated balance sheet and the consolidated balance sheets of its consolidated
Subsidiaries for the fiscal year of the Guarantor ended December 31, 2004 and the related
consolidated statements of income and retained earnings and of cash flows for the Guarantor and its
consolidated Subsidiaries for such fiscal year, setting forth in each case in comparative form the
figures for the previous year, with the opinion thereon of KPMG, LLC. All such financial
statements fairly present, in all material respects, the consolidated financial condition of the
Guarantor and its Subsidiaries and the consolidated results of their operations as at such dates
and for such fiscal periods, all in accordance with GAAP applied on a consistent basis. Since
December 31, 2004, there has been no material adverse change in the consolidated business,
operations or financial condition of the Guarantor and its consolidated Subsidiaries taken as a
whole from that set forth in said financial statements.

(iii) Litigation. Except as otherwise disclosed to the Agent in writing prior to the
date of this Guaranty, there is no action, proceeding or investigation by or before any
Governmental Authority affecting the Guarantor or any of its Affiliates or affecting any of the
Property of any of them, which is reasonably likely to be adversely determined and which, if
decided adversely, would have a reasonable likelihood of having a Material Adverse Effect.

(iv) No Breach. Neither (a) the execution and delivery of this Guaranty nor (b) the
consummation of the transactions herein contemplated in compliance with the terms and provisions
hereof will conflict with or result in a breach of the charter or by-laws of the Guarantor, or any
applicable law, rule or regulation, or any order, writ, injunction or decree of any Governmental
Authority, or other material agreement or instrument to which the Guarantor or any of its
Affiliates is a party or by which any of them or any of their Property is bound or to which any of
them is subject, or constitute a default under any such material agreement or instrument or result
in the creation or imposition of any Lien upon any Property of the Guarantor or any of its
Subsidiaries pursuant to the terms of any such agreement or instrument.

(v) Action. The Guarantor has all necessary corporate or other power, authority and
legal right to execute, deliver and perform its obligations hereunder; the execution, delivery and
performance by the Guarantor of this Guaranty has been duly authorized by all necessary corporate
or other action on its part and this Guaranty has been duly and validly executed and delivered by
the Guarantor and constitutes a legal, valid and binding obligation of the Guarantor, enforceable
against the Guarantor in accordance with its terms.

(vi) Approvals. No authorizations, approvals or consents of, and no filings or
registrations with, any Governmental Authority or any securities exchange are necessary for the
execution, delivery or performance by the Guarantor hereunder or for the legality, validity or
enforceability hereof.

(vii) Taxes. The Guarantor and its Subsidiaries have filed all Federal income tax
returns and all other material tax returns that are required to be filed by them and have paid all
taxes due pursuant to such returns or pursuant to any assessment received by any of them, except
for any such taxes as are being appropriately contested in good faith by appropriate proceedings
diligently conducted and with respect to which adequate reserves have been provided. The charges,
accruals and reserves on the books of the Guarantor and its Subsidiaries in respect of taxes and
other governmental charges are, in the opinion of the Guarantor, adequate.

(viii) Investment Company Act. Neither the Guarantor nor any of its Subsidiaries is
an “investment company”, or a company “controlled” by an “investment company” within the meaning of
the Investment Company Act of 1940, as amended.

(ix) True and Complete Disclosure. The information, reports, financial statements,
exhibits and schedules furnished in writing by or on behalf of the Guarantor to any Beneficiary in
connection with the negotiation, preparation or delivery of this Guaranty and the other Loan
Documents or included herein or therein or delivered pursuant hereto or thereto, when taken as a
whole, do not contain any untrue statement of material fact or omit to state any material fact
necessary to make the statements herein or therein, in light of the circumstances under which they
were made, not misleading. All written information furnished after the date hereof by or on behalf
of the Guarantor to any Beneficiary in connection with this Guaranty and the other Loan Documents
and the transactions contemplated hereby and thereby will be true, complete and accurate in every
material respect, or (in the case of projections) based on reasonable estimates, on the date as of
which such information is stated or certified. There is no fact known to a Responsible Officer of
the Guarantor, after due inquiry, that could reasonably be expected to have a Material Adverse
Effect that has not been disclosed herein, in the other Loan Documents or in a report, financial
statement, exhibit, schedule, disclosure letter or other writing furnished to Agent or any the
Lender for use in connection with the transactions contemplated hereby or thereby.

(x) Tangible Net Worth. On the date hereof, the Tangible Net Worth of the Guarantor
is not less than $750,000,000.

(xi) ERISA. Each Plan to which the Guarantor or its Subsidiaries make direct
contributions, and, to the knowledge of the Guarantor, each other Plan and each Multiemployer Plan
is in compliance in all material respects with, and has been administered in all material respects
in compliance with, the applicable provisions of ERISA, the Code and any other Federal or state
law.

Section 11. Covenants.

(i) Financial Statements. The Guarantor shall deliver to the Agent:

(a) as soon as available and in any event within 90 days after the end of each fiscal
year of the Guarantor, the consolidated balance sheets of the Guarantor and its consolidated
Subsidiaries as at the end of such fiscal year and the related consolidated statements of
income and retained earnings and of cash flows for the Guarantor and its consolidated
Subsidiaries for such year, setting forth in each case in comparative form the figures for
the previous year, accompanied by an opinion thereon of independent certified public
accountants of recognized national standing, which opinion shall not be qualified as to
scope of audit or going concern and shall state that said consolidated financial statements
fairly present the consolidated financial condition and results of operations of the
Guarantor and its consolidated Subsidiaries as at the end of, and for, such fiscal year in
accordance with GAAP, and a certificate of such accountants stating that, in making the
examination necessary for their opinion, they obtained no knowledge, except as specifically
stated, of any Default or Event of Default under the Loan Agreement;

(b) as soon as available and in any event within 30 days after the end of each month,
the unaudited consolidated balance sheets of the Guarantor and its consolidated Subsidiaries
as at the end of such month and the related unaudited consolidated statements of income and
retained earnings and of cash flows of the Guarantor and its consolidated Subsidiaries for
such month and the portion of the fiscal year through the end of such month, setting forth
in each case in comparative form the figures for the previous year, accompanied by a
certificate of a Responsible Officer of the Guarantor, which certificate shall state that
said consolidated financial statement fairly represents the consolidated financial condition
and results of operation of the Guarantor and its consolidated Subsidiaries in accordance
with GAAP, consistently applied, as of the end of, and for, such month (subject to normal
year-end audit adjustments);

(c) from time to time such other information regarding the financial condition,
operations, or business of the Guarantor as the Agent may reasonably request; and

(d) as soon as reasonably possible, and in any event within thirty (30) days after a
Responsible Officer of the Guarantor knows, or with respect to any Plan or Multiemployer
Plan to which the Guarantor or any of its Subsidiaries makes direct contributions, has
reason to believe, that any of the events or conditions specified below with respect to any
Plan or Multiemployer Plan has occurred or exists, a statement signed by a senior financial
officer of the Guarantor setting forth details respecting such event or condition and the
action, if any, that the Guarantor or its ERISA Affiliate proposes to take with respect
thereto (and a copy of any report or notice required to be filed with or given to PBGC by
the Guarantor or an ERISA Affiliate with respect to such event or condition): (i) any
reportable event, as defined in Section 4043(c) of ERISA and the regulations issued
thereunder, with respect to a Plan, as to which PBGC has not by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within thirty (30) days of the
occurrence of such event (provided that a failure to meet the minimum funding standard of
Section 412 of the Code or Section 302 of ERISA, including, without limitation, the failure
to make on or before its due date a required installment under Section 412(m) of the Code or
Section 302(e) of ERISA, shall be a reportable event regardless of the issuance of any
waivers in accordance with Section 412(d) of the Code); and any request for a waiver under
Section 412(d) of the Code for any Plan; (ii) the distribution under Section 4041(c) of
ERISA of a notice of intent to terminate any Plan or any action taken by the Guarantor or an
ERISA Affiliate to terminate any Plan; (iii) the institution by PBGC of proceedings under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer,
any Plan, or the receipt by the Guarantor or any ERISA Affiliate of a notice from a
Multiemployer Plan that such action has been taken by PBGC with respect to such
Multiemployer Plan; (iv) the complete or partial withdrawal from a Multiemployer Plan by the
Guarantor or any ERISA Affiliate that results in liability under Section 4201 or 4204 of
ERISA (including the obligation to satisfy secondary liability as a result of a purchaser
default) or the receipt by the Guarantor or any ERISA Affiliate of notice from a
Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or
4245 of ERISA or that it intends to terminate or has terminated under Section 4041A of
ERISA; (v) the institution of a proceeding by a fiduciary of any Multiemployer Plan against
the Guarantor or any ERISA Affiliate to enforce Section 515 of ERISA, which proceeding is
not dismissed within 30 days; and (vi) the adoption of an amendment to any Plan that would
result in the loss of tax-exempt status of the Plan and trust of which such Plan is a part
if the Guarantor or an ERISA Affiliate fails to provide timely security to such Plan if and
as required by the provisions of Section 401(a)(29) of the Code or Section 307 of ERISA.

The Guarantor will furnish to the Agent, at the time it furnishes each set of financial
statements pursuant to paragraphs (a) and (b) above, a certificate of a Responsible Officer
of the Guarantor (x) setting forth in reasonable detail, all calculations necessary to show
compliance with the requirements set forth in paragraphs (ix) through (xiii) of Section 11
as of the end of such period (or, if the Guarantor is not in compliance with such
paragraphs, (A) showing the extent of non-compliance, (B) specifying the period of
non-compliance and (C) setting forth what actions, if any, the Guarantor has taken, is
taking or proposes to take with respect thereto), and (y) to the effect that, to the best of
such Responsible Officer’s knowledge, the Guarantor during such fiscal period or year has
observed or performed all of its covenants and other agreements, and satisfied every
condition, contained in this Guaranty and the other Loan Documents to be observed, performed
or satisfied by it, and that such Responsible Officer has obtained no knowledge of any
Default or Event of Default except as specified in such certificate (and, if any Default or
Event of Default has occurred and is continuing, describing the same in reasonable detail
and describing the action the Borrowers have taken or proposes to take with respect
thereto).

(ii) Litigation. The Guarantor will promptly, and in any event within ten (10) days
after service of process on any of the following, give to the Agent notice of all litigation,
actions, suits, arbitrations, investigations (including, without limitation, any of the foregoing
which are pending or threatened) or other legal or arbitrable proceedings affecting the Guarantor
or any of its Subsidiaries or affecting any of the Property of any of them before any Governmental
Authority (collectively, “Litigation Matters”) that (i) makes a claim or claims in an
aggregate amount greater than $5,000,000, (ii) is styled as a class action, (iii) individually or
in the aggregate, if adversely determined, could be reasonably likely to have a Material Adverse
Effect or (iv) requires filing with the Securities and Exchange Commission in accordance with the
1934 Act or any rules thereunder. In addition, the Guarantor shall promptly, and in any event
within ten (10) days after service of process on the Guarantor or any of its Affiliates, give to
the Agent notice of any Litigation Matter that questions or challenges the validity or
enforceability of any of the Loan Documents or any action to be taken in connection with the
transactions contemplated hereby.

(iii) Existence, etc. The Guarantor will:

(a) preserve and maintain its legal existence and all of its material rights,
privileges, licenses and franchises;

(b) comply with the requirements of all applicable laws, rules, regulations and orders
of Governmental Authorities (including, without limitation, all environmental laws) if
failure to comply with such requirements would be reasonably likely (either individually or
in the aggregate) to have a Material Adverse Effect;

(c) keep adequate records and books of account, in which complete entries will be made
in accordance with GAAP consistently applied;

(d) pay and discharge all taxes, assessments and governmental charges or levies imposed
on it or on its income or profits or on any of its Property prior to the date on which
penalties attach thereto, except for any such tax, assessment, charge or levy the payment of
which is being contested in good faith and by proper proceedings and against which adequate
reserves are being maintained; and

(e) permit representatives of the Agent, during normal business hours, to examine, copy
and make extracts from its books and records, to inspect any of its Properties, and to
discuss its business and affairs with its officers, all to the extent reasonably requested
by the Agent.

(iv) Prohibition of Fundamental Changes. The Guarantor shall not enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up or dissolve itself
(or suffer any liquidation, winding up or dissolution) or sell all or substantially all of its
assets; provided, that the Guarantor may merge or consolidate with (a) any wholly owned subsidiary
of the Guarantor or (b) any other Person if the Guarantor is the surviving corporation and the
Guarantor’s Tangible Net Worth would not be adversely affected by such merger or consolidation; and
provided further, that if after giving effect thereto, no Default would exist under the Loan
Agreement.

(v) Payment of Shortfall Amounts. The Guarantor shall pay all Shortfall Amounts to or
at the direction of the Agent in immediately available funds no later than one Business Day of
notice from the Agent.

(vi) Notices. The Guarantor shall give notice to each Beneficiary (unless the
Borrowers have already given such notice under the Loan Agreement):

(a) promptly upon receipt of notice or knowledge other than from a Beneficiary of the
occurrence of any Default or Event of Default under the Loan Agreement;

(b) promptly upon receipt of notice other than from a Beneficiary or knowledge of the
occurrence of any breach of a representation or warranty or the failure to observe or
perform any covenant or agreement contained herein;

(c) promptly upon receipt of notice other than from a Beneficiary or knowledge of (A)
any default related to any Collateral, (B) any Lien or security interest (other than
security interests created by the Loan Agreement or other Loan Documents) on, or claim
assert against, any of the Collateral or (C) any event or change in circumstances which
could reasonably be expected to have a Material Adverse Effect; and

(d) promptly upon any material change in the market value of any or all of the
Guarantor’s assets.

Each notice pursuant to this provision shall be accompanied by a statement of a
Responsible Officer of the Guarantor setting forth details of the occurrence referred to
therein and stating what action the Guarantor has taken or proposes to take with respect
thereto.

(vii) Transactions with Affiliates. The Guarantor will not enter into any
transaction, including without limitation any purchase, sale, lease or exchange of property or the
rendering of any service, with any Affiliate unless such transaction is (a) not a violation of any
provision under this Guaranty or the Loan Agreement, as the case may be, (b) in the ordinary course
of the Guarantor’s business and (c) upon fair and reasonable terms no less favorable to the
Guarantor than it would obtain in a comparable arm’s length transaction with a Person which is not
an Affiliate, or make a payment that is not otherwise permitted by this clause (vii) to any
Affiliate.

(viii) Limitation on Distributions. After the occurrence and during the continuation
of any breach of a representation, warranty or covenant contained herein, the Guarantor shall not
make any payment on the account of, or set apart the assets for, a sinking or other analogous fund
for the purchase, redemption, defeasance retirement or other acquisition of any equity interest of
the Guarantor, whether now or hereafter outstanding, or make any other distribution in respect of
any of the foregoing or to any shareholder or equity owner of the Guarantor, either directly or
indirectly, whether in cash or property or in obligations of the Guarantor or any of the
Guarantor’s consolidated Subsidiaries, other than dividends paid by the Guarantor on its Series
1998A Convertible Preferred Stock and its Series 1999A Convertible Preferred Stock in an aggregate
amount not to exceed $3,000,000 per annum.

(ix) Maintenance of Tangible Net Worth. The Guarantor shall not permit its Tangible
Net Worth at any time to be less than the sum of (x) $750,000,000 and (y) an amount equal to 50% of
any Equity Proceeds received by the Guarantor from and after the Reorganization Effective Date.

(x) Maintenance of Ratio of Total Indebtedness to Tangible Net Worth. The Guarantor
shall not permit its ratio of Total Indebtedness to Tangible Net Worth at any time to be greater
than 12:1.

(xi) Minimum Liquidity. The Guarantor shall not permit its cash and pledgeable
collateral, at any time, to be less than 1.5% of its loan receivables held for sale (net allowance
for loan loss).

(xii) Maximum Residual Interest in Securitizations. The Guarantor shall not permit
its ratio of residual interests in securitizations to Tangible Net Worth at any time to be greater
than 1:1.

(xiii) Maintenance of Profitability. The Guarantor shall not permit, for any period
of two consecutive fiscal quarters (each such period, a “Test Period”), Net Income for such
Test Period, before income taxes for such Test Period and distributions made during such Test
Period, to be less than $1.00.

(xiv) Required Filings. The Guarantor shall promptly provide the Agent with copies of
all documents which the Guarantor or any Affiliate of the Guarantor is required to file with the
Securities and Exchange Commission in accordance with the 1934 Act or any rules thereunder.

Section 12. Limitation of Liability. The liability of the Guarantor hereunder shall
in no way be affected by (i) the release or discharge of any Borrower in any creditors’,
receivership, bankruptcy or other proceedings, (ii) the impairment, limitation or modification of
the liability of any Borrower in bankruptcy, or of any remedy for enforcement of any obligations of
the Agent or the Lender under the Loan Agreement resulting from the operation of any present or
future provision of the federal bankruptcy law or any other statute or the decision of any court,
(iii) the rejection or disaffirmance of any instrument, document or agreement evidencing any of the
Agent’s or the Lender’s rights or obligations under the Loan Agreement in any such proceedings,
(iv) the assignment or transfer of the Agent’s or the Lender’s obligations under the Loan Agreement
by the Agent the Lender or (v) the cessation from any cause whatsoever of the liability of the
Agent or the Lender with respect to any such party’s obligations under the Loan Agreement.

Section 13. No Waiver. No failure on the part of any Beneficiary to exercise and no
course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise by any Beneficiary of
any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. The remedies herein are cumulative and not exclusive of any
remedies provided by law.

Section 14. Notices. Notices sent to the Guarantor (including notices of Shortfall
Amounts) via telecopy and telephone shall be sent to the attention of Kevin Cloyd (or such other
person as may hereafter be prescribed by the Guarantor to the Agent in writing) to the telecopy
number of (949) 862-7749 (or such other telecopy number as may hereafter be prescribed by the
Guarantor to the Agent in writing).

Section 15. Expenses. The Guarantor agrees to indemnify each Beneficiary for all
reasonable costs and expenses of such Beneficiary (including, without limitation, the reasonable
fees and expenses of legal counsel) in connection with (i) any non-payment of Shortfall Amounts as
they shall become due and any enforcement or collection proceeding resulting therefrom, including,
without limitation, all manner of participation in or other involvement with (x) bankruptcy,
insolvency, receivership, foreclosure, winding up or liquidation proceeding, (y) judicial or
regulatory proceedings and (z) workout, restructuring or other negotiations or proceedings (whether
or not the workout, restructuring or transaction contemplated thereby is consummated) and (ii) the
enforcement of this Section 15.

Section 16. No Petition. The Guarantor hereby covenants and agrees that, prior to the
date which is one year and one day after the payment in full of all outstanding commercial paper,
extendible notes and any other debt securities of Concord, rated at the request of Concord by an
internationally recognized rating agency, it will not institute against, or join any other Person
in instituting against, Concord any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other similar proceeding under the laws of any jurisdiction. The
provisions of this Section 16 shall survive the termination of this Guaranty.

Section 17. Assignment. The Guarantor may not assign its obligations hereunder
without the prior written consent of each Beneficiary. Any Beneficiary may assign its rights under
this Guaranty to any successor to such Beneficiary under the Loan Agreement, and any assignment of
any Beneficiary’s obligations under the Loan Agreement or any portion thereof by such Beneficiary
shall operate to vest in the assignee, the rights and powers of the Beneficiary hereunder to the
extent of such assignment. This Guaranty shall be binding upon the Guarantor and the Guarantor’s
successors and assigns, and shall inure to the benefit of each Beneficiary and its respective
representatives, successors, successors-in-title and assigns.

Section 18. Governing Law. THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

Section 19. Submission To Jurisdiction; Waivers. The Guarantor hereby irrevocably and
unconditionally:

(i) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
GUARANTY, THE NOTE AND THE OTHER LOAN DOCUMENTS, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT
IN RESPECT THEREOF, TO THE NON EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW
YORK, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
APPELLATE COURTS FROM ANY THEREOF;

(ii) CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND, TO THE
EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY
SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN
INCONVENIENT COURT AND AGREES NOT TO PLEAD OR CLAIM THE SAME;

(iii) AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY
MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL),
POSTAGE PREPAID, TO ITS ADDRESS SET FORTH IN THE LOAN AGREEMENT OR AT SUCH OTHER ADDRESS OF WHICH
THE AGENT SHALL HAVE BEEN NOTIFIED; AND

(iv) AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION.

Section 20. WAIVER OF JURY TRIAL. EACH OF THE GUARANTOR AND EACH BENEFICIARY HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL
BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY, ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

Section 21. Amendments. No amendment or modification hereof shall be effective unless
evidenced by a writing signed by the Guarantor and each Beneficiary.

Section 22. Severability. If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other provisions hereof shall
remain in full force and effect in such jurisdiction and (ii) the invalidity or unenforceability of
any provisions hereof in any jurisdiction shall not affect the validity or enforceability of such
provision in any other jurisdiction.

Section 23. Counterparts. This Guaranty may be executed in any number of
counterparts, all of which taken together shall constitute one and the same instrument, and any of
the parties hereto may execute this Guaranty by signing any such counterpart.

[SIGNATURES FOLLOW]

1

IN WITNESS WHEREOF, the undersigned has executed this Guaranty, or has caused this
Guaranty to be executed by its duly authorized representative, as of the date first above written.

	 	 	 	NEW
CENTURY FINANCIAL CORPORATION, as Guarantor

	 	 	 	 	 	 	 
	
 
	 	 	 	By:
	 	/s/ Robert K. Cole
	
 
	 	 	 	 	 	 
	
 
	 	 	 	By:
	 	Name: Robert K. Cole

Title: CEO

/s/ Kevin Cloyd
	
 
	 	 	 	 	 	 
	
 
	 	 	 	 	 	Name: Kevin Cloyd

Title: Executive Vice President
	 
	 	 	 	 	 	 

2

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Accepted and Acknowledged:

	 	

	 	

	 	

	MORGAN STANLEY MORTGAGE

	 	

	 	

	 	

	 
	 	 	 	 	 	 
	CAPITAL, INC., as Beneficiary
	 	 	 	 
	 
	 	 	 	 	 	 
	By:

	 	/s/ Paul J. Najarian
	 	

	 	

	
 
	 	 
	 	

	 	

	
 
	 	Name: Paul J. Najarian

Title: Vice President
	 	

	 	

	 
	 	 	 	 	 	 

3

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