Document:

STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.,
                                    DEPOSITOR

                         U.S. BANK NATIONAL ASSOCIATION,
                                     TRUSTEE

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

                                       and

                            EMC MORTGAGE CORPORATION
                               SELLER AND COMPANY

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

                         POOLING AND SERVICING AGREEMENT

                          Dated as of December 1, 2003

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

                  Structured Asset Mortgage Investments II Inc.
            Prime Mortgage Trust, Mortgage Pass-Through Certificates

                                  Series 2003-3

<PAGE>

<TABLE>
<CAPTION>
                                                 TABLE OF CONTENTS

                                                                                                               Page
<S>                                                                                                            <C>
                                                     ARTICLE I
                                                    Definitions

                                                    ARTICLE II
                                           Conveyance of Mortgage Loans;
                                         Original Issuance of Certificates
         Section 2.01      CONVEYANCE OF MORTGAGE LOANS TO TRUSTEE...............................................37
         Section 2.02      ACCEPTANCE OF MORTGAGE LOANS BY TRUSTEE...............................................40
         Section 2.03      ASSIGNMENT OF INTEREST IN THE MORTGAGE LOAN PURCHASE AGREEMENT........................42
         Section 2.04      SUBSTITUTION OF MORTGAGE LOANS........................................................43
         Section 2.05      ISSUANCE OF CERTIFICATES..............................................................44
         Section 2.06      REPRESENTATIONS AND WARRANTIES CONCERNING THE DEPOSITOR...............................44

                                                    ARTICLE III
                                  Administration and Servicing of Mortgage Loans
         Section 3.01      MASTER SERVICER.......................................................................47
         Section 3.02      REMIC-RELATED COVENANTS...............................................................48
         Section 3.03      MONITORING OF SERVICERS...............................................................48
         Section 3.04      FIDELITY BOND.........................................................................49
         Section 3.05      POWER TO ACT; PROCEDURES..............................................................49
         Section 3.06      DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS............................................50
         Section 3.07      RELEASE OF MORTGAGE FILES.............................................................50
         Section 3.08      DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER SERVICER TO BE HELD
                           FOR TRUSTEE...........................................................................51
         Section 3.09      STANDARD HAZARD INSURANCE AND FLOOD INSURANCE POLICIES................................52
         Section 3.10      PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS......................................52
         Section 3.11      MAINTENANCE OF THE PRIMARY MORTGAGE INSURANCE POLICIES................................52
         Section 3.12      TRUSTEE TO RETAIN POSSESSION OF CERTAIN INSURANCE POLICIES AND DOCUMENTS..............53
         Section 3.13      REALIZATION UPON DEFAULTED MORTGAGE LOANS.............................................53
         Section 3.14      COMPENSATION FOR THE MASTER SERVICER..................................................53
         Section 3.15      REO PROPERTY..........................................................................54
         Section 3.16      ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.........................................54
         Section 3.17      ANNUAL INDEPENDENT ACCOUNTANT'S SERVICING REPORT......................................55
         Section 3.18      REPORTS FILED WITH SECURITIES AND EXCHANGE COMMISSION.................................55
         Section 3.19      THE COMPANY...........................................................................56
         Section 3.20      UCC...................................................................................56
         Section 3.21      OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS.........................................56

                                                    ARTICLE IV
                                                     Accounts
         Section 4.01      PROTECTED ACCOUNTS....................................................................58

                                                        -i-

<PAGE>

         Section 4.02      MASTER SERVICER COLLECTION ACCOUNT....................................................59
         Section 4.03      PERMITTED WITHDRAWALS AND TRANSFERS FROM THE MASTER SERVICER COLLECTION ACCOUNT.......60
         Section 4.04      DISTRIBUTION ACCOUNT..................................................................61
         Section 4.05      PERMITTED WITHDRAWALS AND TRANSFERS FROM THE DISTRIBUTION ACCOUNT.....................61

                                                     ARTICLE V
                                                   Certificates
         Section 5.01      CERTIFICATES..........................................................................64
         Section 5.02      REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.................................70
         Section 5.03      MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.....................................73
         Section 5.04      PERSONS DEEMED OWNERS.................................................................74
         Section 5.05      TRANSFER RESTRICTIONS ON RESIDUAL CERTIFICATES........................................74
         Section 5.06      RESTRICTIONS ON TRANSFERABILITY OF CERTIFICATES.......................................75
         Section 5.07      ERISA RESTRICTIONS....................................................................75
         Section 5.08      RULE 144A INFORMATION.................................................................77

                                                    ARTICLE VI
                                          Payments to Certificateholders
         Section 6.01      DISTRIBUTIONS ON THE CERTIFICATES.....................................................78
         Section 6.02      ALLOCATION OF LOSSES..................................................................84
         Section 6.03      PAYMENTS..............................................................................86
         Section 6.04      STATEMENTS TO CERTIFICATEHOLDERS......................................................86
         Section 6.05      MONTHLY ADVANCES......................................................................89
         Section 6.06      COMPENSATING INTEREST PAYMENTS........................................................89
         Section 6.07      POLICY MATTERS........................................................................89
         Section 6.08      RESERVE FUND..........................................................................92
         Section 6.09      ROUNDING ACCOUNT......................................................................93
         Section 6.10      PRINCIPAL DISTRIBUTIONS ON THE INSURED CERTIFICATES...................................93

                                                    ARTICLE VII
                                                The Master Servicer
         Section 7.01      LIABILITIES OF THE MASTER SERVICER....................................................98
         Section 7.02      MERGER OR CONSOLIDATION OF THE MASTER SERVICER........................................98
         Section 7.03      INDEMNIFICATION OF THE TRUSTEE, THE MASTER SERVICER AND THE SECURITIES ADMINISTRATOR..98
         Section 7.04      LIMITATIONS ON LIABILITY OF THE MASTER SERVICER AND OTHERS............................98
         Section 7.05      MASTER SERVICER NOT TO RESIGN........................................................100
         Section 7.06      SUCCESSOR MASTER SERVICER............................................................100
         Section 7.07      SALE AND ASSIGNMENT OF MASTER SERVICING..............................................100

                                                   ARTICLE VIII
                                                      Default
         Section 8.01      EVENTS OF DEFAULT....................................................................102
         Section 8.02      TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.............................................103
         Section 8.03      NOTIFICATION TO CERTIFICATEHOLDERS...................................................104

                                                       -ii-

<PAGE>

         Section 8.04      WAIVER OF DEFAULTS...................................................................104
         Section 8.05      LIST OF CERTIFICATEHOLDERS...........................................................105

                                                    ARTICLE IX
                              Concerning the Trustee and the Securities Administrator
         Section 9.01      DUTIES OF TRUSTEE....................................................................106
         Section 9.02      CERTAIN MATTERS AFFECTING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR...............108
         Section 9.03      TRUSTEE AND SECURITIES ADMINISTRATOR NOT LIABLE FOR CERTIFICATES OR MORTGAGE LOANS...109
         Section 9.04      TRUSTEE AND SECURITIES ADMINISTRATOR MAY OWN CERTIFICATES............................110
         Section 9.05      TRUSTEE'S AND SECURITIES ADMINISTRATOR'S FEES AND EXPENSES...........................110
         Section 9.06      ELIGIBILITY REQUIREMENTS FOR TRUSTEE AND SECURITIES ADMINISTRATOR....................110
         Section 9.07      INSURANCE............................................................................111
         Section 9.08      RESIGNATION AND REMOVAL OF THE TRUSTEE AND SECURITIES ADMINISTRATOR..................111
         Section 9.09      SUCCESSOR TRUSTEE AND SUCCESSOR SECURITIES ADMINISTRATOR.............................112
         Section 9.10      MERGER OR CONSOLIDATION OF TRUSTEE OR SECURITIES ADMINISTRATOR.......................112
         Section 9.11      APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE........................................113
         Section 9.12      FEDERAL INFORMATION RETURNS AND REPORTS TO CERTIFICATEHOLDERS; REMIC ADMINISTRATION..114

                                                     ARTICLE X
                                                    Termination
         Section 10.01     TERMINATION UPON REPURCHASE BY THE DEPOSITOR OR ITS DESIGNEE OR LIQUIDATION
                           OF THE MORTGAGE LOANS................................................................116
         Section 10.02     ADDITIONAL TERMINATION REQUIREMENTS..................................................118

                                                    ARTICLE XI
                                             Miscellaneous Provisions
         Section 11.01     INTENT OF PARTIES....................................................................120
         Section 11.02     AMENDMENT............................................................................120
         Section 11.03     RECORDATION OF AGREEMENT.............................................................121
         Section 11.04     LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS...........................................121
         Section 11.05     ACTS OF CERTIFICATEHOLDERS...........................................................122
         Section 11.06     GOVERNING LAW........................................................................123
         Section 11.07     NOTICES..............................................................................123
         Section 11.08     SEVERABILITY OF PROVISIONS...........................................................123
         Section 11.09     SUCCESSORS AND ASSIGNS...............................................................123
         Section 11.10     ARTICLE AND SECTION HEADINGS.........................................................124
         Section 11.11     COUNTERPARTS.........................................................................124
         Section 11.12     NOTICE TO RATING AGENCIES............................................................124
         Section 11.13     MBIA RIGHTS..........................................................................124
</TABLE>

                                                       -iii-

<PAGE>

                                    EXHIBITS

Exhibit A-1               -    Form of Class A Certificates
Exhibit A-2               -    Form of Class B Certificates
Exhibit A-3               -    Form of Class R Certificates
Exhibit B                 -    Mortgage Loan Schedule
Exhibit C                 -    [Reserved]
Exhibit D                 -    Request for Release of Documents
Exhibit E                 -    Form of Affidavit pursuant to Section 860E(e)(4)
Exhibit F-1               -    Form of Investment Letter
Exhibit F-2               -    Form of Rule 144A and Related Matters Certificate
Exhibit G                 -    Form of Custodial Agreement
Exhibit H-1 to H-5        -    Servicing Agreements
Exhibit I                 -    Assignment Agreements
Exhibit J                 -    Mortgage Loan Purchase Agreement
Exhibit K                 -    Certificate Guaranty Insurance Policy

                                      -iv-

<PAGE>

                         POOLING AND SERVICING AGREEMENT
                         -------------------------------

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

                              PRELIMINARY STATEMENT

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

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

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

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

         The Mortgage Loans will have an Outstanding Principal Balance as of the
Cut-off Date, after deducting all Scheduled Principal due on or before the
Cut-off Date, of $424,352,215. The initial principal amount of the Certificates
will not exceed such Outstanding Principal Balance.

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

<PAGE>

                                    ARTICLE I
                                   Definitions

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

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

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

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

         ADJUSTABLE RATE CERTIFICATES: The Class A-3, Class A-4, Class A-7 and
Class A-8 Certificates.

         ADJUSTMENT AMOUNT: The amount, if any, by which the Special Hazard Loss
Amount (without giving effect to the deduction of the Adjustment Amount for such
anniversary) exceeds the lesser of (A) an amount calculated by the Seller and
approved by the related Rating Agencies, which amount shall not be less than
$500,000, and (B) the greater of (x) 1.0% (or if greater than 1.0%, the highest
percentage of Mortgage Loans by principal balance secured by Mortgaged
Properties in any California zip code) of the outstanding principal balance of
all the Mortgage Loans on the Distribution Date immediately preceding such
anniversary and (y) twice the outstanding principal balance of the Mortgage Loan
which has the largest outstanding principal balance on the Distribution Date
immediately preceding such anniversary.

         AFFILIATE: As to any Person, any other Person controlling, controlled
by or under common control with such Person. "Control" means the power to direct
the management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise. "Controlled" and
"Controlling" have meanings correlative to the foregoing. The Trustee

                                       -2-

<PAGE>

may conclusively presume that a Person is not an Affiliate of another Person
unless a Responsible Officer of the Trustee has actual knowledge to the
contrary.

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

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

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

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

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

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

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

                                       -3-

<PAGE>

         ASSIGNMENT AGREEMENTS: The agreements attached hereto as Exhibit I,
whereby the Servicing Agreements were assigned to the Trustee for the benefit of
the Certificateholders.

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

         ASSUMED FINAL DISTRIBUTION DATE: January 25, 2034, or if such day is
not a Business Day, the next succeeding Business Day.

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

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

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

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

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

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

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

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

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

                                       -4-

<PAGE>

                  (ix) any expenses or other amounts reimbursable to the
Trustee, the Securities Administrator and the Custodian pursuant to Section
7.04(c) or Section 9.05.

         AVERAGE LOSS SEVERITY PERCENTAGE: With respect to any Distribution
Date, the percentage equivalent of a fraction, the numerator of which is the sum
of the Loss Severity Percentages for each Mortgage Loan which had a Realized
Loss and the denominator of which is the number of Mortgage Loans which had
Realized Losses.

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

         BANKRUPTCY COVERAGE TERMINATION DATE: The Distribution Date upon which
the Bankruptcy Loss Amount has been reduced to zero or a negative number (or the
Cross-Over Date, if earlier).

         BANKRUPTCY LOSS AMOUNT: $100,000, minus the aggregate amount of
previous Bankruptcy Losses.

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

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

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

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

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

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

         CERTIFICATE REGISTER: The register maintained pursuant to Section 5.02.

         CERTIFICATEHOLDER: A Holder of a Certificate.

         CLASS: With respect to the Certificates, A-1, A-2, A-3, A-4, A-5, A-6,
A-7, A-8, A-9, PO, R-I, R-II, R-III, B-1, B-2, B-3, B-4, B-5 and B-6.

                                       -5-

<PAGE>

         CLASS PO CERTIFICATE CASH SHORTFALL: For any Distribution Date, the
difference between (i) principal distributable to the Class PO Certificates in
accordance with priority FIFTH of clause (i) under subsection 6.01(a), and (ii)
principal actually distributed to the Class PO Certificates after giving effect
to clause (iii) under subsection 6.01(a).

         CLASS PO CERTIFICATE DEFERRED AMOUNT: As to each Distribution Date
through the Cross-Over Date, the aggregate of all amounts allocable on such
dates to the Class PO Certificates in respect of the principal portion of
Realized Losses in respect of Discount Mortgage Loans in Subgroup 1 and the
Class PO Certificate Cash Shortfall and all amounts previously allocated in
respect of such losses and such shortfalls to the Class PO Certificates, and not
distributed on prior Distribution Dates.

         CLASS PO CERTIFICATE PRINCIPAL DISTRIBUTION AMOUNT: The Class PO
Certificates shall be entitled to distributions from Subgroup 1. For each Class
of Class PO Certificates with respect to each Distribution Date will be an
amount equal to the sum of:

                  (i) the PO Percentage of all scheduled payments of principal
         due on each Discount Mortgage Loan in Subgroup 1 on the related Due
         Date as specified in the amortization schedule at the time applicable
         thereto (after adjustment for previous principal prepayments but before
         any adjustment to such amortization schedule by reason of any
         bankruptcy or similar proceeding or any moratorium or similar waiver or
         grace period);

                  (ii) the PO Percentage of the Scheduled Principal Balance of
         each Discount Mortgage Loan in Subgroup 1 which was the subject of a
         prepayment in full received by the related Master Servicer during the
         applicable Prepayment Period;

                  (iii) the PO Percentage of all partial prepayments of
         principal of each Discount Mortgage Loan in the related Subgroup
         received during the applicable Prepayment Period;

                  (iv) the lesser of (a) the PO Percentage of the sum of (A) all
         Net Liquidation Proceeds allocable to principal on each Discount
         Mortgage Loan in Subgroup 1 which became a Liquidated Mortgage Loan
         during the related Prepayment Period (other than a Discount Mortgage
         Loan described in clause (B)) and (B) the Scheduled Principal Balance
         of each such Discount Mortgage Loan in Subgroup 1 purchased by an
         insurer from the Trustee during the related Prepayment Period pursuant
         to the related Primary Mortgage Insurance Policy, if any, or otherwise;
         and (b) the PO Percentage of the sum of (A) the Scheduled Principal
         Balance of each Discount Mortgage Loan in Subgroup 1 which became a
         Liquidated Mortgage Loan during the related Prepayment Period (other
         than a Discount Mortgage Loan described in clause (B)) and (B) the
         Scheduled Principal Balance of each such Mortgage Loan in Subgroup 1
         that was purchased by an insurer from the Trustee during the related
         Prepayment Period pursuant to the related Primary Mortgage Insurance
         Policy, if any, or otherwise; and

                  (v) the PO Percentage of the sum of (a) the Scheduled
         Principal Balance of each Discount Mortgage Loan in Subgroup 1 which
         was repurchased by the Seller in connection with such Distribution Date
         and (b) the difference, if any, between the Scheduled Principal Balance
         of a Discount Mortgage Loan in Subgroup 1 that has been replaced by the
         Seller

                                       -6-

<PAGE>

         with a substitute Discount Mortgage Loan pursuant to the Agreement in
         connection with such Distribution Date and the Scheduled Principal
         Balance of such substitute Discount Mortgage Loan.

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

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

         CLOSING DATE: December 23, 2003.

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

         COMPENSATING INTEREST PAYMENT: As defined in Section 6.06.

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

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

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

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

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

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

                                       -7-

<PAGE>

         CORRESPONDING CERTIFICATES: With respect to each REMIC II Regular
Interest, the Class with the same designation.

         CORPORATE TRUST OFFICE: The office of the Trustee at which at any
particular time its corporate trust business is administered, which office, at
the date of the execution of this Agreement, is located at US Bank Corporate
Trust Services, One Federal Street, 3rd Floor, Boston, Massachusetts 02110,
Attention: Corporate Trust Services/PRIME 2003-3. For purposes of registration
and transfer and exchange only, the Corporate Trust Office shall be located at
U.S. Bank National Association, 60 Livingston Avenue, Bond Drop Window, St.
Paul, Minnesota 55107.

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

         CURRENT PRINCIPAL AMOUNT: With respect to any Certificate (other than
an Interest Only Certificate) as of any Distribution Date, the initial principal
amount of such Certificate, and reduced by (i) all amounts distributed on
previous Distribution Dates on such Certificate with respect to principal, (ii)
the principal portion of all Realized Losses allocated prior to such
Distribution Date to such Certificate, taking account of the Loss Allocation
Limitation and (iii) in the case of a Subordinate Certificate, such
Certificate's pro rata share, if any, of the applicable Subordinate Certificate
Writedown Amount for previous Distribution Dates. With respect to any Class of
Certificates (other than an Interest Only Certificate), the Current Principal
Amount thereof will equal the sum of the Current Principal Amounts of all
Certificates in such Class. Notwithstanding the foregoing, solely for purposes
of giving consents, directions, waivers, approvals, requests and notices, the
Class R-I, Class R-II and Class R-III Certificates after the Distribution Date
on which they each receive the distribution of the last dollar of their
respective original principal amount shall be deemed to have Current Principal
Amounts equal to their respective Current Principal Amounts on the day
immediately preceding such Distribution Date. Exclusively for the purpose of
determining any subrogation rights of MBIA arising under Section 6.07 hereof,
the Current Principal Amount of the Class A-6 Certificates shall not be reduced
by the amount of any payments made by MBIA in respect of principal on such
Certificates under the Policy, except to the extent such payment shall have been
reimbursed to MBIA pursuant to the provisions of this Agreement.

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

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

         CUT-OFF DATE: December 1, 2003.

         CUT-OFF DATE BALANCE: $424,352,215.

                                       -8-

<PAGE>

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

         DECEASED HOLDER: A Certificate Owner of an Insured Certificate who was
a natural person living at the time such interest was acquired and whose
authorized personal representative, surviving tenant by the entirety, surviving
joint tenant or surviving tenant in common or other person empowered to act on
behalf of a deceased Certificate Owner causes to be furnished to the Depository
Participant evidence of death satisfactory to the Depository Participant and any
tax waivers requested by the Depository Participant.

         DEFICIENCY AMOUNT: As of any Distribution Date, an amount equal to the
sum of:

                  (a) any interest shortfall allocated to the Class A-6
                  Certificates, except for any Net Interest Shortfalls allocated
                  to the Class A-6 Certificates;

                  (b) the principal portion of any Realized Losses allocated to
                  the Class A-6 Certificates; and

                  (c) the Current Principal Amount of the Class A-6 Certificates
                  to the extent unpaid on the Assumed Final Distribution Date
                  (after taking into account all distributions on that date).

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

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

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

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

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

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

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

                                       -9-

<PAGE>

         DISCOUNT MORTGAGE LOAN: Any Mortgage Loan with a Net Mortgage Rate less
than 5.500% per annum.

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

         DISTRIBUTION ACCOUNT: The trust account or accounts created and
maintained pursuant to Section 4.04, which shall be denominated "U.S. Bank
National Association, as Trustee f/b/o holders of Structured Asset Mortgage
Investments II Inc., Prime Mortgage Trust, Mortgage Pass-Through Certificates,
Series 2003-3 - Distribution Account." The Distribution Account shall be an
Eligible Account.

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

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

         DTC CUSTODIAN: U.S. Bank National Association, or its successors in
interest as custodian for the Depository.

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

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

                                      -10-

<PAGE>

         ELIGIBLE ACCOUNT: Any of (i) a segregated account maintained with a
federal or state chartered depository institution (A) the short-term obligations
of which are rated A-1 or better by Standard & Poor's and P-1 by Moody's at the
time of any deposit therein or (B) insured by the FDIC (to the limits
established by such Corporation), the uninsured deposits in which account are
otherwise secured such that, as evidenced by an Opinion of Counsel (obtained by
the Person requesting that the account be held pursuant to this clause (i))
delivered to the Trustee prior to the establishment of such account, the
Certificateholders will have a claim with respect to the funds in such account
and a perfected first priority security interest against any collateral (which
shall be limited to Permitted Investments, each of which shall mature not later
than the Business Day immediately preceding the Distribution Date next following
the date of investment in such collateral or the Distribution Date if such
Permitted Investment is an obligation of the institution that maintains the
Distribution Account) securing such funds that is superior to claims of any
other depositors or general creditors of the depository institution with which
such account is maintained, (ii) a segregated trust account or accounts
maintained with a federal or state chartered depository institution or trust
company with trust powers acting in its fiduciary capacity or (iii) a segregated
account or accounts of a depository institution acceptable to the Rating
Agencies (as evidenced in writing by the Rating Agencies that use of any such
account as the Distribution Account will not have an adverse effect on the then-
current ratings assigned to the Classes of Certificates then rated by the Rating
Agencies determined without regard to the Policy). Eligible Accounts may bear
interest.

         EMC: EMC Mortgage Corporation.

         EMC SERVICING AGREEMENT: With respect to Mortgage Loans originated by
Wachovia, the Servicing Agreement dated as of December 1, 2003, between the
Depositor and EMC, as attached hereto as Exhibit H-1 as modified by the related
Assignment Agreement.

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

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

         EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion thereof (i)
occurring after the Bankruptcy Coverage Termination Date or (ii) if on or prior
to such date, in excess of the then- applicable Bankruptcy Loss Amount.

         EXCESS FRAUD LOSS: Any Fraud Loss or portion thereof (i) occurring
after the Fraud Coverage Termination Date with respect thereto or (ii) if on or
prior to such date, in excess of the then- applicable Fraud Loss Amount.

         EXCESS LOSS: Any Excess Fraud Loss, Excess Bankruptcy Loss, Excess
Special Hazard Loss or Extraordinary Loss.

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

                                      -11-

<PAGE>

day of the month in which the related Liquidation Date occurs, plus (ii) related
Liquidation Expenses.

         EXCESS SPECIAL HAZARD LOSS: Any Special Hazard Loss occurring after the
Special Hazard Termination Date.

         EXTRAORDINARY LOSS : Any Realized Loss resulting from damage to a
mortgaged property that was occasioned by war, civil insurrection, certain
governmental actions, nuclear reaction and certain other risks.

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

         FITCH RATINGS: Fitch, Inc.

         FDIC: Federal Deposit Insurance Corporation or any successor thereto.

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

         FRACTIONAL UNDIVIDED INTEREST: With respect to any Class of
Certificates, the fractional undivided interest evidenced by any Certificate of
such Class the numerator of which is the Current Principal Amount, or Notional
Amount in the case of the Interest Only Certificates, of such Certificate and
the denominator of which is the Current Principal Amount, or Notional Amount in
the case of the Interest Only Certificates, of such Class. With respect to the
Certificates in the aggregate, the fractional undivided interest evidenced by
(i) each class of Residual Certificates will be deemed to equal 0.25%, (ii) each
Class of Interest Only Certificates will be deemed to equal 1.0% multiplied by a
fraction, the numerator of which is the Notional Amount of such Certificate and
the denominator of which is the aggregate Notional Amount of its respective
Class and (iii) a Certificate of any other Class will be deemed to equal 97.25%
multiplied by a fraction, the numerator of which is the Current Principal Amount
of such Certificate and the denominator of which is the aggregate Current
Principal Amount of all the Certificates; provided, however, the percentage in
clause (iii) above shall be increased by 1.0% upon the retirement of each Class
of Interest Only Certificates.

         FRAUD COVERAGE TERMINATION DATE: The Distribution Date upon which the
Fraud Loss Amount has been reduced to zero or a negative number (or the
Cross-Over Date, if earlier).

         FRAUD LOSS: Any Realized Loss attributable to fraud in the origination
of the related Mortgage Loan, as reported by the applicable Servicer to the
Master Servicer.

         FRAUD LOSS AMOUNT: Upon the initial issuance of the Certificates, 2.00%
of the aggregate Scheduled Principal Balances of the Mortgage Loans. As of any
Distribution Date prior to the first anniversary of the Cut-off Date, the
initial Fraud Loss Amount minus the aggregate amount of Fraud Losses that would
have been allocated to the Subordinate Certificates in the absence of the Loss
Allocation Limit since the Cut-off Date. As of any Distribution Date from the
second and through the fifth anniversary of the Cut-off Date, (1) the lesser of
(a) the applicable Fraud Loss Amount as of the most recent anniversary of the
Cut-off Date and (b) 1.00% of the aggregate outstanding

                                      -12-

<PAGE>

principal balance of all Mortgage Loans as of the most recent anniversary of the
Cut-off Date minus (2) the Fraud Losses that would have been allocated to the
Subordinate Certificates in the absence of the Loss Allocation Limit since the
most recent anniversary of the Cut-off Date. After the fifth anniversary of the
Cut-off Date, the Fraud Loss Amount shall be zero.

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

         GMAC: GMAC Mortgage Company.

         GMAC SERVICING AGREEMENT: The Servicing Agreement, dated as of May 1,
2001, between the Seller and GMAC, attached hereto as Exhibit H-2, as modified
by the related Assignment Agreement.

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

         HOLDER: The Person in whose name a Certificate is registered in the
Certificate Register, except that, subject to Subsections 11.02(b) and 11.05(e),
solely for the purpose of giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Depositor, the Master Servicer or the
Trustee or any Affiliate thereof shall be deemed not to be outstanding and the
Fractional Undivided Interest evidenced thereby shall not be taken into account
in determining whether the requisite percentage of Fractional Undivided
Interests necessary to effect any such consent has been obtained. With respect
to the Class A-6 Certificates, MBIA to the extent of any MBIA Reimbursement
Amount.

         HSBC: HSBC Mortgage Corporation (USA), or its successor in interest.

         HSBC SERVICING AGREEMENT: With respect to the Mortgage Loans originated
by HSBC, the Purchase, Warranties and Servicing Agreement dated as of May 1,
2002 between the Seller and HSBC, attached hereto as Exhibit H-3 as modified by
the related Assignment Agreement.

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

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

                                      -13-

<PAGE>

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

         INDIVIDUAL INSURED CERTIFICATE: An Insured Certificate that evidences
$1,000 initial Current Principal Amount.

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

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

         INSURANCE AGREEMENT: The Insurance Agreement dated as of December 1,
2003, among the Insurer, the Depositor, the Seller and the Trustee.

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

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

         INSURED CERTIFICATES: The Class A-6 Certificates.

         INSURED PAYMENT: (a) As of any Distribution Date, any Deficiency Amount
and (b) any Preference Amount.

         INSURER:  MBIA Insurance Corporation.

         INTEREST ACCRUAL PERIOD: With respect to each Distribution Date, for
each Class of Certificates, the calendar month preceding the month in which such
Distribution Date occurs, except for the Class A-3, Class A-4, Class A-7 and
Class A-8 Certificates which have an interest accrual period beginning on the
25th day of the month preceding the month in which the Distribution Date occurs
and ending on the 24th day of the month in which the Distribution Date occurs,
in each case commencing in December 2003.

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

         INTEREST ONLY CERTIFICATES: The Class A-4 Certificates and Class A-8
Certificates.

         INTEREST SHORTFALL: With respect to any Distribution Date and each
Mortgage Loan that during the related Prepayment Period was the subject of a
Principal Prepayment or constitutes a Relief Act Mortgage Loan, an amount
determined as follows:

                                      -14-

<PAGE>

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

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

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

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

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

         LATE PAYMENT RATE: As defined in the Insurance Agreement.

         LENDER-PAID PMI RATE: With respect to each Mortgage Loan covered by a
lender-paid primary mortgage insurance policy, the amount payable to the related
insurer, as stated in the Mortgage Loan Schedule.

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

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

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

                                      -15-

<PAGE>

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

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

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

         LIVING OWNER: A Certificate Owner of an Insured Certificate other than
a Deceased Holder.

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

         LOCKOUT CERTIFICATES: The Class A-9 Certificates.

         LOCKOUT PERCENTAGE: On any Distribution Date occurring during the
periods set forth below will be as follows:

         Period (dates inclusive)                  Lockout Prepayment Percentage
         ------------------------                  -----------------------------

         January 25, 2004 - December 25, 2008                0%
         January 25, 2009 - December 25, 2009                30%
         January 25, 2010 - December 25, 2010                40%
         January 25, 2011 - December 25, 2011                60%
         January 25, 2012 - December 25, 2012                80%
         January 25, 2013 and thereafter                     100%

         LOCKOUT PRINCIPAL AMOUNT: For any Distribution Date, an amount equal to
the Lockout Percentage multiplied by the Lockout Pro Rata Optimal Principal
Amount.

         LOCKOUT PRO RATA OPTIMAL PRINCIPAL AMOUNT: For any Distribution Date,
shall be an amount equal to the product of (x) the Subgroup 1 Principal
Distribution Amount for such Distribution Date (without regard to the Subgroup 1
Senior Percentage or the Subgroup 1 Senior Prepayment Percentage) multiplied by
(y) a fraction, the numerator of which is the Current Principal Amount of the
Class A-9 Certificates immediately prior to such Distribution Date and the
denominator of which is the sum of the Non-PO Percentages of the Scheduled
Principal Balances of the Mortgage Loans in Subgroup 1.

                                      -16-

<PAGE>

         LOSS ALLOCATION LIMIT: The meaning specified in Section 6.02(e) hereof.

         LOSS SEVERITY PERCENTAGE: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the amount of
Realized Losses incurred on a Mortgage Loan and the denominator of which is the
Scheduled Principal Balance of such Mortgage Loan immediately prior to the
liquidation of such Mortgage Loan.

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

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

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

         MASTER SERVICER COLLECTION ACCOUNT: The trust account or accounts
created and maintained pursuant to Section 4.02, which shall be denominated
"U.S. Bank National Association, as Trustee f/b/o holders of Structured Asset
Mortgage Investments II Inc., Prime Mortgage Trust, Mortgage Pass-Through
Certificates, Series 2003-3 - Master Servicer Collection Account." The Master
Servicer Collection Account shall be an Eligible Account.

         MASTER SERVICING COMPENSATION: The meaning specified in Section 3.14.

         MATERIAL DEFECT: The meaning specified in Section 2.02(a).

         MBIA: MBIA Insurance Corporation, a subsidiary of MBIA Inc., organized
and created under the laws of the State of New York, or any successor thereto.

         MBIA CONTACT PERSON: The officer designated by the Master Servicer to
provide information to MBIA pursuant to Section 6.07(i).

                                      -17-

<PAGE>

         MBIA DEFAULT: As defined in Section 6.07(l).

         MBIA REIMBURSEMENT AMOUNT: Shall mean the sum of (a) the aggregate
unreimbursed amount of any payments made by MBIA under the Policy, together with
interest on such amount from the date of payment by MBIA until paid in full at a
rate of interest equal to the Late Payment Rate, (b) all costs and expenses of
MBIA in connection with any action, proceeding or investigation affecting the
Trust Fund or the rights or obligations of MBIA under this Agreement or under
the Policy, including any judgment or settlement entered into affecting MBIA or
MBIA's interests, together with interest thereon at a rate equal to the Late
Payment Rate and (c) any other amounts owed to MBIA under this Agreement or the
Insurance Agreement, together with interest thereon at a rate equal to the Late
Payment Rate.

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

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

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

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

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

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

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

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

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

                                      -18-

<PAGE>

Mortgage and Mortgage File and all rights appertaining thereto), including a
mortgage loan the property securing which has become an REO Property.

         MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement
dated as of December 23, 2003, between EMC Mortgage Corporation, as seller, and
Structured Asset Mortgage Investments II Inc., as purchaser, and all amendments
thereof and supplements thereto, attached as Exhibit J.

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

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

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

         MORTGAGOR: The obligor on a Mortgage Note.

         NATIONAL CITY: National City Mortgage Company.

         NATIONAL CITY SERVICING AGREEMENT: The Purchase, Warranties and
Servicing Agreement, dated as of October 1, 2001, between the Seller and
National City, attached hereto as Exhibit H-4, as modified by the related
Assignment Agreement.

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

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

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

         NON-DISCOUNT MORTGAGE LOAN: Any Mortgage Loan with a Net Mortgage Rate
higher than 5.500% per annum.

         NON-OFFERED SUBORDINATE CERTIFICATES: The Class B-4, Class B-5 and
Class B-6 Certificates.

                                      -19-

<PAGE>

         NON-PO PERCENTAGE: With respect to any Mortgage Loan with a Net
Mortgage Rate less than 5.500% per annum, a fraction, expressed as a percentage,
(x) the numerator of which is equal to the related Net Mortgage Rate, and (y)
the denominator of which is equal to 5.500% per annum.

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

         NOTIONAL AMOUNT: The Notional Amount of the Class A-4 Certificates, as
of any date of determination, is equal to the Current Principal Amount of the
Class A-3 Certificates. The Notional Amount of the Class A-8 Certificates, as of
any date of determination, is equal to the Current Principal Amount of the Class
A-7 Certificates. For federal income tax purposes, however, the notional amount
of the Class A-4 Certificates is the Uncertificated Principal Balance of REMIC
II Regular Interest A-3. For federal income tax purposes, however, the notional
amount of the Class A-8 Certificates is the Uncertificated Principal Balance of
REMIC II Regular Interest A-7.

         OFFERED CERTIFICATES: The Senior Certificates and Offered Subordinate
Certificates.

         OFFERED SUBORDINATE CERTIFICATES: The Class B-l, Class B-2 and Class
B-3 Certificates.

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

         OPINION OF COUNSEL: A written opinion of counsel who is or are
acceptable to the Trustee or MBIA, or the Master Servicer, as applicable, and
who, unless required to be Independent (an "Opinion of Independent Counsel"),
may be internal counsel for the Company, the Master Servicer or the Depositor.

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

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

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

                                      -20-

<PAGE>

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

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

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

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

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

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

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

                                      -21-

<PAGE>

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

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

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

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

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

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

         PHYSICAL CERTIFICATES: The Residual Certificates and the Private
Certificates.

         POLICY: The irrevocable Certificate Guaranty Insurance Policy, No.
43092, including any endorsements thereto, issued by MBIA with respect to the
Class A-6 Certificates, in the form attached hereto as Exhibit K.

         PO PERCENTAGE: With respect to any Discount Mortgage Loan, a fraction
expressed as a percentage, (x) the numerator of which is equal to 5.500% minus
the related Net Mortgage Rate, and (y) the denominator of which is equal to
5.500% per annum.

         PREFERENCE AMOUNT: Any amount previously distributed to Holders of the
Class A-6 Certificates that is recoverable and sought to be recovered as a
voidable preference by a trustee in bankruptcy pursuant to the United States
Bankruptcy Code (11 U.S.C.), as amended from time to time, in accordance with a
final nonappealable order of a court having competent jurisdiction.

         PREPAYMENT CHARGE: With respect to any Mortgage Loan, the charges or
premiums, if any, due in connection with a full or partial prepayment of such
Mortgage Loan in accordance with the terms thereof.

                                      -22-

<PAGE>

         PREPAYMENT INTEREST SHORTFALL: With respect to any Distribution Date,
the aggregate shortfall, if any, in collections of interest (adjusted to the
related Net Mortgage Rates) on Mortgage Loans resulting from (a) prepayments in
full received during the related Prepayment Period and (b) the partial
prepayments received during the related Prepayment Period to the extent applied
prior to the Due Date in the month of the Distribution Date.

         PREPAYMENT PERIOD: With respect to any Distribution Date is the period
commencing on the 16th day of the month prior to the month in which the related
Distribution Date occurs and ending on the 15th day of the month in which such
Distribution Date occurs in the case of the Mortgage Loans for which EMC is the
Servicer and such period as is provided in the related Servicing Agreement with
respect to the other Servicers.

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

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

         PRIVATE CERTIFICATES: The Class B-4, Class B-5 and Class B-6
Certificates.

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

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

         QUALIFIED INSURER: Any insurance company duly qualified as such under
the laws of the state or states in which the related Mortgaged Property or
Mortgaged Properties is or are located, duly authorized and licensed in such
state or states to transact the type of insurance business in which it is
engaged and approved as an insurer by the Master Servicer, so long as the claims
paying ability of which is acceptable to the Rating Agencies for pass-through
certificates having the same rating as the Certificates rated by the Rating
Agencies as of the Closing Date.

         RANDOM LOT: With respect to any Distribution Date, the method by which
the Depository will determine which Insured Certificates will be paid, using its
established random lot procedures or, if the Insured Certificates are no longer
represented by a Book-Entry Certificate, using the Trustee's procedures.

         RATING AGENCIES: Moody's and S&P.

                                      -23-

<PAGE>

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

         RECORD DATE: With respect to any Distribution Date, the close of
business on the last Business Day of the month immediately preceding the month
of such Distribution Date, except for the Class A-3, Class A-4, Class A-7 and
Class A-8 Certificates which have a record date of the Business Day prior to the
Distribution Date

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

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

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

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

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

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

         REMIC I REGULAR INTERESTS: REMIC I Regular Interests 1-A, 2-A, PO,
1-ZZZ and 2-ZZZ.

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

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

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

         REMIC II REGULAR INTERESTS: REMIC II Regular Interests A-1, A-2, A-3,
A-5, A-6, A-7, A-9, PO, R-III, B-1, B-2, B-3, B-4, B-5 and B-6.

                                      -24-

<PAGE>

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

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

         REMIC III REGULAR CERTIFICATES: The Class A-1, Class A-2, Class A-3,
Class A-4 , Class A-5, Class A-6, Class A-7, Class A-8, Class A-9, Class PO,
Class B-1, Class B-2, Class B-3 , Class B-4, Class B-5 and Class B-6
Certificates.

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

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

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

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

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

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

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

         RESERVE FUND: A fund established at the time of the issuance of the
Certificates solely for the benefit of the Class A-6 Certificates by an initial
deposit into the Reserve Fund of $20,000 by Bear, Stearns & Co. Inc.

                                      -25-

<PAGE>

         RESIDUAL CERTIFICATES: Any of the Class R Certificates.

         RESPONSIBLE OFFICER: Any officer assigned to the Corporate Trust Office
(or any successor thereto), including any Vice President, Assistant Vice
President, Trust Officer, any Assistant Secretary, any trust officer or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and having direct
responsibility for the administration of this Agreement, and any other officer
of the Trustee to whom a matter arising hereunder may be referred.

         ROUNDING ACCOUNT: With respect to the Insured Certificates, the account
created and maintained for such Insured Certificates pursuant to Section 6.09.

         ROUNDING AMOUNT: With respect to the Rounding Account, the amount of
funds, if any, needed to be withdrawn and used to round the amount of any
distributions in reduction of the Current Principal Amount of the Insured
Certificates upward to the next higher integral multiple of $1,000.

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

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

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

         SCHEDULED PRINCIPAL: The principal portion of any Scheduled Payment.

         SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan on any
Distribution Date, (i) the unpaid principal balance of such Mortgage Loan as of
the close of business on the related Due Date (i.e., taking account of the
principal payment to be made on such Due Date and irrespective of any
delinquency in its payment), as specified in the amortization schedule at the
time relating thereto (before any adjustment to such amortization schedule by
reason of any bankruptcy or similar proceeding occurring after the Cut-off Date
(other than a Deficient Valuation) or any moratorium or similar waiver or grace
period) and less (ii) any Principal Prepayments (including the principal portion
of Net Liquidation Proceeds) received during or prior to the related Prepayment
Period; provided that the Scheduled Principal Balance of a Liquidated Mortgage
Loan is zero.

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

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

                                      -26-

<PAGE>

         SECURITIES LEGEND: "THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3)
IN CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE
MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT
OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS
PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN
THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY
OTHER APPLICABLE JURISDICTION. THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR
INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED [in the case of a Residual Certificate or a Private
Certificate] UNLESS THE OPINION OF COUNSEL REQUIRED BY SECTION 5.07 OF THE
POOLING AND SERVICING AGREEMENT IS PROVIDED [in the case of the Class B-4, Class
B-5 and Class B-6 Certificates]:, UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS
THAT THE PROPOSED TRANSFER AND HOLDING OF A CERTIFICATE AND THE SERVICING,
MANAGEMENT AND OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY
PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS
PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED
TRANSACTION EXEMPTION ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60 OR PTE 96-23
AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON THE PART OF
THE DEPOSITOR, THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER, ANY SERVICER
OR THE TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY
CERTIFICATE OR A GLOBAL CERTIFICATE AND WILL BE EVIDENCED BY A REPRESENTATION OR
AN OPINION OF COUNSEL TO SUCH EFFECT BY OR ON BEHALF OF AN INSTITUTIONAL
ACCREDITED INVESTOR."

                                      -27-

<PAGE>

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

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

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

         SENIOR CERTIFICATES: The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7, Class A-8, Class A-9, Class PO, Class R-I,
Class R-II and Class R-III Certificates.

         SERVICER: With respect to each Mortgage Loan, EMC, U.S. Central, HSBC,
GMAC, National City or Union Federal.

         SERVICER REMITTANCE DATE: With respect to each Mortgage Loan, the date
set forth in the related Servicing Agreement.

         SERVICING AGREEMENTS: The EMC Servicing Agreement, HSBC Servicing
Agreement, National City Servicing Agreement, U.S. Central Servicing Agreement,
GMAC Servicing Agreement and Union Federal Servicing Agreement.

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

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

         SERVICING OFFICER: Any officer of the related Servicer or Master
Servicer involved in or responsible for the administration and servicing or
master servicing, as applicable, of the Mortgage Loans as to which officer
evidence, reasonably acceptable to the Trustee, of due authorization of such
officer, by such Servicer or Master Servicer has been furnished from time to
time to the Trustee and MBIA.

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

         SPECIAL HAZARD LOSS AMOUNT: Upon the initial issuance of the
Certificates, $4,243,522. As of any Distribution Date, the Special Hazard Loss
Amount will equal the initial Special Hazard Loss Amount, minus the sum of (i)
the aggregate amount of Special Hazard Losses that would have been

                                      -28-

<PAGE>

previously allocated to the Subordinate Certificates in the absence of the Loss
Allocation Limit and (ii) the Adjustment Amount.

         SPECIAL HAZARD TERMINATION DATE: The Distribution Date upon which the
Special Hazard Loss Amount has been reduced to zero or a negative number (or the
Cross-Over Date, if earlier).

         STARTUP DAY: December 23, 2003.

         SUBGROUP: Any of Subgroup 1 and Subgroup 2.

         SUBGROUP 1: All of the Mortgage Loans with a Net Mortgage Rate of less
than or equal to 5.500% per annum, plus the Subgroup 1 Fraction of the principal
balance of any Mortgage Loan with a Net Mortgage Rate greater than 5.500% per
annum and less than 8.000% per annum.

         SUBGROUP 1 CERTIFICATES: The Class A-1, Class A-2, Class A-3, Class
A-5, Class A-6, Class A-9, Class R-I, Class R-II and Class R-III Certificates.

         SUBGROUP 1 FRACTION: With respect to any Mortgage Loan with a Net
Mortgage Rate of greater than 5.500% per annum and less than 8.000% per annum, a
fraction, (x) the numerator of which is equal to 8.000% minus the Net Mortgage
Rate of such Mortgage Loan, and (y) the denominator of which is equal to 2.500%
per annum.

         SUBGROUP 2: All of the Mortgage Loans with a Net Mortgage Rate equal to
8.000% per annum plus the Subgroup 2 Fraction of the principal balance of any
Mortgage Loan with a Net Mortgage Rate of greater than 5.500% per annum and less
than 8.000% per annum.

         SUBGROUP 2 CERTIFICATES: The Class A-7 Certificates.

         SUBGROUP 2 FRACTION: With respect to any Mortgage Loan with a Net
Mortgage Rate of greater than 5.500% per annum and less than 8.000% per annum, a
fraction, (x) the numerator of which is equal to the Net Mortgage Rate of such
Mortgage Loan minus 5.500% per annum, and (y) the denominator of which is equal
to 2.500% per annum.

         SUBGROUP PRINCIPAL DISTRIBUTION AMOUNT: With respect to each
Distribution Date and each of Subgroup 1 and Subgroup 2 Certificates, an amount
equal to the sum, without duplication, of the following (but in no event greater
than the aggregate Current Principal Amounts of the Subgroup 1 and Subgroup 2
Certificates, as applicable, immediately prior to such Distribution Date):

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

                                      -29-

<PAGE>

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

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

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

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

         SUBGROUP SENIOR PERCENTAGE: The initial Subgroup Senior Percentage for
each Subgroup will be equal to approximately 96.47%. With respect to each
Subgroup on any Distribution Date, the lesser of (i) 100% and (ii) the
percentage (carried to six places rounded up) obtained by dividing the aggregate
Current Principal Amount of the Senior Certificates of such Subgroup immediately
preceding such Distribution Date by the aggregate Scheduled Principal Balance of
the Mortgage Loans in the related Subgroup (other than the PO Percentage thereof
with respect to the related Discount Mortgage Loans) of the beginning of the
related Due Period.

         SUBGROUP SENIOR PREPAYMENT PERCENTAGE: The Subgroup Senior Prepayment
Percentage for the Subgroup 1 and Subgroup 2 Certificates on any Distribution
Date occurring during the periods set forth below, as follows:

<TABLE>
<CAPTION>
Period (dates inclusive)                              Subgroup Senior Prepayment Percentage
----------------------------------------------------- -------------------------------------
<S>                                                   <C>
January 25, 2004 - December 25, 2008                  100%

                                      -30-

<PAGE>

January 2009 - December 25, 2009                      Subgroup Senior Percentage for the related
                                                      Subgroup Certificates plus 70% of the related
                                                      Subordinate Percentage

January 2010 - December 25, 2010                      Subgroup Senior Percentage for the related
                                                      Subgroup Certificates plus 60% of the related
                                                      Subordinate Percentage

January 25, 2011 - December 25, 2011                  Subgroup Senior Percentage for the related
                                                      Subgroup Certificates plus 40% of the related
                                                      Subordinate Percentage

January 25, 2012 - December 25, 2012                  Subgroup Senior Percentage for the related
                                                      Subgroup Certificates plus 20% of the related
                                                      Subordinate Percentage

January 25, 2013 and thereafter                       Subgroup Senior Percentage for the related
                                                      Subgroup Certificates
</TABLE>

         In addition, no reduction of the Subgroup Senior Prepayment Percentage
for the Subgroup 1 and Subgroup 2 Certificates shall occur on any Distribution
Date unless, as of the last day of the month preceding such Distribution Date,
(A) the aggregate Scheduled Principal Balance of the Mortgage Loans delinquent
60 days or more (including for this purpose any such Mortgage Loans in
foreclosure and Mortgage Loans with respect to which the related Mortgaged
Property has been acquired by the Trust), averaged over the last six months, as
a percentage of the sum of the aggregate Current Principal Amount of the
Subordinate Certificates does not exceed 50%; and (B) cumulative Realized Losses
on the Mortgage Loans do not exceed (a) 30% of the Original Subordinate
Principal Balance if such Distribution Date occurs between and including January
2009 and December 2009, (b) 35% of the Original Subordinate Principal Balance if
such Distribution Date occurs between and including January 2010 and December
2010, (c) 40% of the Original Subordinate Principal Balance if such Distribution
Date occurs between and including January 2011 and December 2011, (d) 45% of the
Original Subordinate Principal Balance if such Distribution Date occurs between
and including January 2012 and December 2012, and (e) 50% of the Original
Subordinate Principal Balance if such Distribution Date occurs during or after
January 2013.

         Notwithstanding the foregoing, if on any Distribution Date, the
percentage for Subgroup 1 or Subgroup 2, the numerator of which is the aggregate
Current Principal Amount of the Senior Certificates of such Subgroup immediately
preceding such Distribution Date, and the denominator of which is the Scheduled
Principal Balance of the Mortgage Loans in such Subgroup (other than the PO
Percentage thereof with respect to the related Discount Mortgage Loans) as of
the beginning of the related Due Period, exceeds such percentage as of the
Cut-off Date, then the Subgroup Senior Prepayment Percentage with respect to the
Senior Certificates of each Subgroup for each Distribution Date will equal 100%.

         SUBORDINATE CERTIFICATES: The Class B-1, Class B-2, Class B-3, Class
B-4, Class B-5 and Class B-6 Certificates.

         SUBORDINATE CERTIFICATE WRITEDOWN AMOUNT: As to any Distribution Date,
the amount by which (a) the sum of the Current Principal Amounts of all the
Certificates (after giving effect to the

                                      -31-

<PAGE>

distribution of principal and the allocation of applicable Realized Losses in
reduction of the Current Principal Amounts of the Certificates on such
Distribution Date) exceeds (b) the aggregate Scheduled Principal Balances of the
Mortgage Loans on the Due Date related to such Distribution Date.

         SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: As to any Distribution Date, an
amount equal to the sum, without duplication, of the following from each
Subgroup (but in no event greater than the aggregate Current Principal Amount of
the Subordinate Certificates immediately prior to such Distribution Date):

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

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

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

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

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

                  (vi) on the Distribution Date on which the Current Principal
                  Amounts of the related Senior Certificates (other than the
                  Interest Only Certificates and Class PO Certificates), have
                  all been reduced to zero, 100% of the related Subgroup
                  Principal

                                      -32-

<PAGE>

                  Distribution Amount. After the aggregate Current Principal
                  Amount of the Subordinate Certificates has been reduced to
                  zero, the Subordinate Optimal Principal Amount shall be zero.

         SUBORDINATE PERCENTAGE: As of any Distribution Date and with respect to
any Subgroup, 100% minus the related Subgroup Senior Percentage for the Senior
Certificates related to such Subgroup. The initial Subordinate Percentage for
each Subgroup will be equal to approximately 3.53%.

         SUBORDINATE PREPAYMENT PERCENTAGE: As of any Distribution Date and with
respect to any Subgroup, 100% minus the related Subgroup Senior Prepayment
Percentage for such Subgroup, except that on any Distribution Date after the
Current Principal Amount of each class of Senior Certificates have each been
reduced to zero, the Subordinate Prepayment Percentage for the Subordinate
Certificates with respect to such Subgroup will equal 100%.

         SUBSTITUTE MORTGAGE LOAN: A mortgage loan tendered to the Trustee
pursuant to the related Servicing Agreement, the Mortgage Loan Purchase
Agreement or Section 2.04 of this Agreement, as applicable, in each case, (i)
which has an Outstanding Principal Balance not greater nor materially less than
the Mortgage Loan for which it is to be substituted; (ii) which has a Mortgage
Interest Rate and Net Rate not less than, and not materially greater than, such
Mortgage Loan; (iii) which has a maturity date not materially earlier or later
than such Mortgage Loan and not later than the latest maturity date of any
Mortgage Loan; (iv) which is of the same property type and occupancy type as
such Mortgage Loan; (v) which has a Loan-to-Value Ratio not greater than the
Loan-to-Value Ratio of such Mortgage Loan; (vi) which is current in payment of
principal and interest as of the date of substitution; and (vii) as to which the
payment terms do not vary in any material respect from the payment terms of the
Mortgage Loan for which it is to be substituted.

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

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

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

         TRUSTEE: U.S. Bank National Association, or its successor in interest,
or any successor trustee appointed as herein provided.

         UNCERTIFICATED PRINCIPAL BALANCE: With respect to any REMIC I Regular
Interest or REMIC II Regular Interest as of any Distribution Date, the initial
principal amount of such Regular Interest, reduced by (i) all amounts
distributed on previous Distribution Dates on such Regular Interest with respect
to principal, and (ii) the principal portion of all Realized Losses allocated
prior to such Distribution Date to such Regular Interest, taking account of the
Loss Allocation Limit.

                                      -33-

<PAGE>

         UNDERLYING SELLER: With respect to each Mortgage Loan, EMC, HSBC,
National City, U.S. Central, Waterfield or GMAC, as indicated on the Mortgage
Loan Schedule.

         UNION FEDERAL: Union Federal Bank of Indianapolis, or its successor in
interest.

         UNION FEDERAL SERVICING AGREEMENT: With respect to the Mortgage Loans
originated by Waterfield, the Amended and Restated Forward Commitment Flow
Mortgage Loan Purchase and Servicing Agreement dated as of March 4, 2003 between
the Seller and Union Federal, attached hereto as Exhibit H-8 as modified by the
related Assignment Agreement.

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

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

         U.S. CENTRAL: U.S. Central Credit Union.

         U.S. CENTRAL SERVICING AGREEMENT: The Purchase, Warranties and
Servicing Agreement, dated as of June 1, 2002, between the Seller and U.S.
Central, as amended by Amendment No. 1 to the Purchase, Warranties and Servicing
Agreement dated as of January 13, 2003 and the Letter Agreement dated as of
November 13, 2003 between U.S. Central and EMC attached hereto as Exhibit H-5,
as modified by the related Assignment Agreement.

         WATERFIELD: Waterfield Mortgage Company, or its successor in interest.

                                      -34-

<PAGE>

         Section 1.02. CALCULATION OF LIBOR.

         LIBOR applicable to the calculation of the Pass-Through Rate on the
Adjustable Rate Certificates for any Interest Accrual Period will be determined
on each Interest Determination Date. On each Interest Determination Date, LIBOR
shall be established by the Securities Administrator and, as to any Interest
Accrual Period, will equal the rate for one month United States dollar deposits
that appears on the Telerate Screen Page 3750 as of 11:00 a.m., London" time, on
such Interest Determination Date. "Telerate Screen Page 3750" means the display
designated as page 3750 on the Telerate Service (or such other page as may
replace page 3750 on that service for the purpose of displaying London interbank
offered rates of major banks). If such rate does not appear on such page (or
such other page as may replace that page on that service, or if such service is
no longer offered, LIBOR shall be so established by use of such other service
for displaying LIBOR or comparable rates as may be reasonably selected by the
Securities Administrator), the rate will be the Reference Bank Rate. The
"Reference Bank Rate" will be determined on the basis of the rates at which
deposits in U.S. Dollars are offered by the reference banks (which shall be any
three major banks that are engaged in transactions in the London interbank
market, selected by the Securities Administrator) as of 11:00 a.m., London time,
on the Interest Determination Date to prime banks in the London interbank market
for a period of one month in amounts approximately equal to the aggregate
Current Principal Amount of the Adjustable Rate Certificates then outstanding.
The Securities Administrator will request the principal London office of each of
the reference banks to provide a quotation of its rate. If at least two such
quotations are provided, the rate will be the arithmetic mean of the quotations
rounded up to the nearest whole multiple of 0.03125%. If on such date fewer than
two quotations are provided as requested, the rate will be the arithmetic mean
of the rates quoted by one or more major banks in New York City, selected by the
Securities Administrator, as of 11:00 a.m., New York City time, on such date for
loans in U.S. Dollars to leading European banks for a period of one month in
amounts approximately equal to the aggregate Current Principal Amount of the
Adjustable Rate Certificates then outstanding. If no such quotations can be
obtained, the rate will be LIBOR for the prior Distribution Date; PROVIDED
HOWEVER, if, under the priorities described above, LIBOR for a Distribution Date
would be based on LIBOR for the previous Distribution Date for the third
consecutive Distribution Date, the Securities Administrator shall select an
alternative comparable index (over which the Securities Administrator e has no
control), used for determining one-month Eurodollar lending rates that is
calculated and published (or otherwise made available) by an independent party.
The establishment of LIBOR by the Securities Administrator on any Interest
Determination Date and the Securities Administrator's subsequent calculation of
the Pass-Through Rate applicable to the Adjustable Rate Certificates for the
relevant Interest Accrual Period, in the absence of manifest error, will be
final and binding. Promptly following each Interest Determination Date the
Securities Administrator shall supply the Master Servicer with the results of
its determination of LIBOR on such date.

                                      -35-

<PAGE>

                                   ARTICLE II
                          Conveyance of Mortgage Loans;
                        Original Issuance of Certificates

         Section 2.01 CONVEYANCE OF MORTGAGE LOANS TO TRUSTEE. (a) The Depositor
concurrently with the execution and delivery of this Agreement, sells, transfers
and assigns to the Trust without recourse all its right, title and interest in
and to (i) the Mortgage Loans identified in the Mortgage Loan Schedule,
including all interest and principal due with respect to the Mortgage Loans
after the Cut-off Date, but excluding any payments of principal and interest due
on or prior to the Cut-off Date; (ii) such assets as shall from time to time be
credited or are required by the terms of this Agreement to be credited to the
Master Servicer Collection Account, (iii) such assets relating to the Mortgage
Loans as from time to time may be held by the Servicers in Protected Accounts,
the Master Servicer in the Master Servicer Collection Account and the Trustee in
the Distribution Account, (iv) any REO Property, (v) the Required Insurance
Policies and any amounts paid or payable by the insurer under any Insurance
Policy (to the extent the mortgagee has a claim thereto), (vi) the Mortgage Loan
Purchase Agreement to the extent provided in Subsection 2.03(a), (vii) the
rights with respect to the Servicing Agreements as assigned to the Trustee on
behalf of the Certificateholders by the Assignment Agreements, (viii) the
Policy, the Class A-6 Policy Payments Account, the Rounding Account and the
Reserve Fund and (ix) any proceeds of the foregoing. Although it is the intent
of the parties to this Agreement that the conveyance of the Depositor's right,
title and interest in and to the Mortgage Loans and other assets in the Trust
Fund pursuant to this Agreement shall constitute a purchase and sale and not a
loan, in the event that such conveyance is deemed to be a loan, it is the intent
of the parties to this Agreement that the Depositor shall be deemed to have
granted to the Trustee a first priority perfected security interest in all of
the Depositor's right, title and interest in, to and under the Mortgage Loans
and other assets in the Trust Fund, and that this Agreement shall constitute a
security agreement under applicable law.

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

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

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

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

                                      -36-

<PAGE>

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

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

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

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

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

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

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

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

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

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

                  (v) The Security Agreement;

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

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

                                      -37-

<PAGE>

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

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

PROVIDED, HOWEVER, that in lieu of the foregoing, the Depositor may deliver to
the Custodian, as agent of the Trustee, the following documents, under the
circumstances set forth below: (w) in lieu of the original Security Instrument,
assignments to the Trustee or intervening assignments thereof which have been
delivered, are being delivered or will, upon receipt of recording information
relating to the Security Instrument required to be included thereon, be
delivered to recording offices for recording and have not been returned to the
Depositor in time to permit their delivery as specified above, the Depositor may
deliver a true copy thereof with a certification by the Depositor, on the face
of such copy, substantially as follows: "Certified to be a true and correct copy
of the original, which has been transmitted for recording"; (x) in lieu of the
Security Instrument, assignment to the Trustee or intervening assignments
thereof, if the applicable jurisdiction retains the originals of such documents
(as evidenced by a certification from the Depositor to such effect) the
Depositor may deliver photocopies of such documents containing an original
certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; (y) in lieu of the Mortgage
Notes relating to the Mortgage Loans identified on Exhibit 5 to the Mortgage
Loan Purchase Agreement, the Depositor may deliver lost note affidavits from the
Seller; and (z) the Depositor shall not be required to deliver intervening
assignments or Mortgage Note endorsements between the related Underlying Seller
and the Seller, between the Seller and the Depositor, and between the Depositor
and the Trustee; and provided, further, however, that in the case of Mortgage
Loans which have been prepaid in full after the Cut-off Date and prior to the
Closing Date, the Depositor, in lieu of delivering the above documents, may
deliver to the Trustee or the Custodian, as its agent, a certification to such
effect and shall deposit all amounts paid in respect of such Mortgage Loans in
the Master Servicer Collection Account on the Closing Date. The Depositor shall
deliver such original documents (including any original documents as to which
certified copies had previously been delivered) to the Trustee or the Custodian,
as its agent, promptly after they are received. The Depositor shall cause the
Seller, at its expense, to cause each assignment of the Security Instrument to
the Trustee to be recorded not later than 180 days after the Closing Date,
unless (a) such recordation is not required by the Rating Agencies or an Opinion
of Counsel addressed to the Trustee and MBIA has been provided to the Trustee
(with a copy to the Custodian) and MBIA which states that recordation of such
Security Instrument is not required to protect the interests of the
Certificateholders in the related Mortgage Loans or (b) MERS is identified on
the Mortgage or on a properly recorded assignment of the Mortgage as the
mortgagee of record solely as nominee for the Seller and its successor and
assigns; provided, however, notwithstanding the foregoing, each assignment shall
be submitted for recording by the Seller in the manner described above, at no
expense to the Trust or the Trustee or the Custodian, as its agent, upon the
earliest to occur of: (i) reasonable direction by the Holders of Certificates
evidencing Fractional Undivided Interests aggregating not less than 25% of the
Trust, (ii) the occurrence of an Event of Default, (iii) the occurrence of a
bankruptcy, insolvency or foreclosure relating to the Seller and (iv) the
occurrence of a servicing transfer as described in Section 8.02 hereof.
Notwithstanding the foregoing, if the Seller fails to pay the cost of recording
the assignments, such expense will be paid

                                      -38-

<PAGE>

by the Trustee and the Trustee shall be reimbursed for such expenses by the
Trust in accordance with Section 9.05.

         (c) [reserved]

         Section 2.02 ACCEPTANCE OF MORTGAGE LOANS BY TRUSTEE. (a) The Trustee
acknowledges the sale, transfer and assignment of the Trust Fund to it by the
Depositor and receipt of, subject to further review and the exceptions which may
be noted pursuant to the procedures described below, and declares that it holds,
the documents (or certified copies thereof) delivered to the Custodian, as its
agent, pursuant to Section 2.01, and declares that it will continue to hold
those documents and any amendments, replacements or supplements thereto and all
other assets of the Trust Fund delivered to it as Trustee in trust for the use
and benefit of all present and future Holders of the Certificates and MBIA. On
the Closing Date, the Custodian, with respect to the Mortgage Loans, shall
acknowledge with respect to each Mortgage Loan by delivery to the Depositor,
MBIA and the Trustee of an Initial Certification receipt of the Mortgage File,
but without review of such Mortgage File, except to the extent necessary to
confirm that such Mortgage File contains the related Mortgage Note or lost note
affidavit. No later than 90 days after the Closing Date (or, with respect to any
Substitute Mortgage Loan, within five Business Days after the receipt by the
Trustee or Custodian thereof), the Trustee agrees, for the benefit of the
Certificateholders and MBIA, to review or cause to be reviewed by the Custodian
on its behalf (under the Custodial Agreement), each Mortgage File delivered to
it and to execute and deliver, or cause to be executed and delivered, to the
Depositor, MBIA and the Trustee an Interim Certification. In conducting such
review, the Trustee or Custodian will ascertain whether all required documents
have been executed and received, and based on the Mortgage Loan Schedule,
whether those documents relate, determined on the basis of the Mortgagor name,
original principal balance and loan number, to the Mortgage Loans it has
received, as identified in the Mortgage Loan Schedule. In performing any such
review, the Trustee or the Custodian, as its agent, may conclusively rely on the
purported due execution and genuineness of any such document and on the
purported genuineness of any signature thereon. If the Trustee or the Custodian,
as its agent, finds any document constituting part of the Mortgage File has not
been executed or received, or to be unrelated, determined on the basis of the
Mortgagor name, original principal balance and loan number, to the Mortgage
Loans identified in Exhibit B or to appear defective on its face (a "Material
Defect"), the Trustee or the Custodian, as its agent, shall promptly notify the
Seller. In accordance with the Mortgage Loan Purchase Agreement, the Seller
shall correct or cure any such defect within ninety (90) days from the date of
notice from the Trustee or the Custodian, as its agent, of the defect and if the
Seller fails to correct or cure the defect within such period, and such defect
materially and adversely affects the interests of the Certificateholders in the
related Mortgage Loan, the Trustee shall enforce the Seller's obligation under
the Mortgage Loan Purchase Agreement to, within 90 days from the Trustee's or
the Custodian's notification, provide a Substitute Mortgage Loan (if within two
years of the Closing Date) or purchase such Mortgage Loan at the Repurchase
Price; provided that, if such defect would cause the Mortgage Loan to be other
than a "qualified mortgage" as defined in Section 860G(a)(3) of the Code, any
such cure or repurchase must occur within 90 days from the date such breach was
discovered; provided, however, that if such defect relates solely to the
inability of the Seller to deliver the original Security Instrument or
intervening assignments thereof, or a certified copy because the originals of
such documents, or a certified copy have not been returned by the applicable
jurisdiction, the Seller shall not be required to purchase such Mortgage Loan if
the Seller delivers such original documents or

                                      -39-

<PAGE>

certified copy promptly upon receipt, but in no event later than 360 days after
the Closing Date. The foregoing repurchase obligation shall not apply in the
event that the Seller cannot deliver such original or copy of any document
submitted for recording to the appropriate recording office in the applicable
jurisdiction because such document has not been returned by such office;
provided that the Seller shall instead deliver a recording receipt of such
recording office or, if such receipt is not available, a certificate confirming
that such documents have been accepted for recording, and delivery to the
Trustee or the Custodian, as its agent, shall be effected by the Seller within
thirty days of its receipt of the original recorded document.

         (b) No later than 180 days after the Closing Date, the Trustee or the
Custodian, as its agent, will review, for the benefit of the Certificateholders
and MBIA, the Mortgage Files delivered to it and will execute and deliver or
cause to be executed and delivered to the Depositor, MBIA and the Trustee a
Final Certification. In conducting such review, the Trustee or the Custodian, as
its agent, will ascertain whether an original of each document required to be
recorded has been returned from the recording office with evidence of recording
thereon or a certified copy has been obtained from the recording office. If the
Trustee or the Custodian, as its agent, finds a Material Defect, the Trustee or
the Custodian, as its agent, shall promptly notify the Seller (provided,
however, that with respect to those documents described in subsections
(b)(I)(iv), (v), (vii) and (viii)(2) and (3) of Section 2.01 and subsection
(b)(II)(ix) of Section 2.01, the Trustee's and Custodian's obligations shall
extend only to the documents actually delivered to the Custodian pursuant to
such subsections). In accordance with the Mortgage Loan Purchase Agreement, the
Seller shall correct or cure any such defect within 90 days from the date of
notice from the Trustee or the Custodian, as its agent, of the Material Defect
and if the Seller is unable to cure such defect within such period, and if such
defect materially and adversely affects the interests of the Certificateholders
in the related Mortgage Loan, the Trustee shall enforce the Seller's obligation
under the Mortgage Loan Purchase Agreement to, within 90 days from the Trustee's
or Custodian's notification, provide a Substitute Mortgage Loan (if within two
years of the Closing Date) or purchase such Mortgage Loan at the Repurchase
Price, provided that, if such defect would cause the Mortgage Loan to be other
than a "qualified mortgage" as defined in Section 860G(a)(3) of the Code, any
such cure, repurchase or substitution must occur within 90 days from the date
such breach was discovered, provided, however, that if such defect relates
solely to the inability of the Seller to deliver the original Security
Instrument or intervening assignments thereof, or a certified copy, because the
originals of such documents or a certified copy, have not been returned by the
applicable jurisdiction, the Seller shall not be required to purchase such
Mortgage Loan, if the Seller delivers such original documents or certified copy
promptly upon receipt, but in no event later than 360 days after the Closing
Date. The foregoing repurchase obligation shall not apply in the event that the
Seller cannot deliver such original or copy of any document submitted for
recording to the appropriate recording office in the applicable jurisdiction
because such document has not been returned by such office; provided that the
Seller shall instead deliver a recording receipt of such recording office or, if
such receipt is not available, a certificate confirming that such documents have
been accepted for recording, and delivery to the Trustee or the Custodian, as
its agent, shall be effected by the Seller within thirty days of its receipt of
the original recorded document.

         (c) In the event that a Mortgage Loan is purchased by the Seller in
accordance with Subsections 2.02(a) or (b) above, the Seller shall remit to the
Master Servicer the Repurchase Price for deposit in the Master Servicer
Collection Account and the Seller shall provide to the Securities

                                      -40-

<PAGE>

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

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

         (b) If the Depositor, the Securities Administrator or the Trustee
discovers a breach of any of the representations and warranties set forth in the
Mortgage Loan Purchase Agreement, which breach materially and adversely affects
the value of the interests of Certificateholders or the Trustee in the related
Mortgage Loan, the party discovering the breach shall give prompt written notice
of the breach to the other parties. The Seller, within 90 days of its discovery
or receipt of notice that such breach has occurred (whichever occurs earlier),
shall cure the breach in all material respects or, subject to the Mortgage Loan
Purchase Agreement or Section 2.04 of this Agreement, as applicable, shall
purchase the Mortgage Loan or any property acquired with respect thereto from
the Trustee; provided, however, that if there is a breach of any representation
set forth in the Mortgage Loan Purchase Agreement or Section 2.04 of this
Agreement, as applicable, and the Mortgage Loan or the related property acquired
with respect thereto has been sold, then the Seller shall pay, in lieu of the
Repurchase Price, any excess of the Repurchase Price over the Net Liquidation
Proceeds received upon such sale. If the Net Liquidation Proceeds exceed the
Repurchase Price, any excess shall be paid to the Seller to the extent not
required by law to be paid to the borrower. Any such purchase by the Seller
shall be made by providing an amount equal to the Repurchase Price to the Master
Servicer for deposit in the Master Servicer Collection Account and written
notification detailing the components of such Repurchase Price. The Depositor
shall notify the Trustee and submit to the

                                      -41-

<PAGE>

Custodian, as agent for the Trustee, a Request for Release, and the Custodian
shall release, or the Trustee shall cause the Custodian to release, to the
Seller the related Mortgage File and the Trustee shall execute and deliver all
instruments of transfer or assignment furnished to it by the Seller, without
recourse, representation or warranty as are necessary to vest in the Seller
title to and rights under the Mortgage Loan or any property acquired with
respect thereto. Such purchase shall be deemed to have occurred on the date on
which the Repurchase Price in available funds is received by the Trustee. The
Master Servicer shall amend the Mortgage Loan Schedule to reflect such
repurchase and shall promptly notify the Trustee, MBIA and the Rating Agencies
of such amendment. Enforcement of the obligation of the Seller to purchase (or
substitute a Substitute Mortgage Loan for) any Mortgage Loan or any property
acquired with respect thereto (or pay the Repurchase Price as set forth in the
above proviso) as to which a breach has occurred and is continuing shall
constitute the sole remedy respecting such breach available to the
Certificateholders or the Trustee on their behalf.

         Section 2.04 SUBSTITUTION OF MORTGAGE LOANS. Notwithstanding anything
to the contrary in this Agreement, in lieu of purchasing a Mortgage Loan
pursuant to the Mortgage Loan Purchase Agreement or Sections 2.02 or 2.03 of
this Agreement, the Seller may, no later than the date by which such purchase by
the Seller would otherwise be required, tender to the Trustee a Substitute
Mortgage Loan accompanied by a certificate of an authorized officer of the
Seller that such Substitute Mortgage Loan conforms to the requirements set forth
in the definition of "Substitute Mortgage Loan" in this Agreement; provided,
however, that substitution pursuant to the Mortgage Loan Purchase Agreement or
Section 2.04 of this Agreement, as applicable, in lieu of purchase shall not be
permitted after the termination of the two-year period beginning on the Startup
Day; provided, further, that if the breach would cause the Mortgage Loan to be
other than a "qualified mortgage" as defined in Section 860G(a)(3) of the Code,
any such cure or substitution must occur within 90 days from the date the breach
was discovered. The Custodian, as agent for the Trustee, shall examine the
Mortgage File for any Substitute Mortgage Loan in the manner set forth in
Section 2.02(a) and the Trustee or the Custodian, as its agent, shall notify the
Seller, in writing, within five Business Days after receipt, whether or not the
documents relating to the Substitute Mortgage Loan satisfy the requirements of
the fifth sentence of Subsection 2.02(a). Within two Business Days after such
notification, the Seller shall provide to the Trustee for deposit in the
Distribution Account the amount, if any, by which the Outstanding Principal
Balance as of the next preceding Due Date of the Mortgage Loan for which
substitution is being made, after giving effect to the Scheduled Principal due
on such date, exceeds the Outstanding Principal Balance as of such date of the
Substitute Mortgage Loan, after giving effect to Scheduled Principal due on such
date, which amount shall be treated for the purposes of this Agreement as if it
were the payment by the Seller of the Repurchase Price for the purchase of a
Mortgage Loan by the Seller. After such notification to the Seller and, if any
such excess exists, upon receipt of such deposit, the Trustee shall accept such
Substitute Mortgage Loan which shall thereafter be deemed to be a Mortgage Loan
hereunder. In the event of such a substitution, accrued interest on the
Substitute Mortgage Loan for the month in which the substitution occurs and any
Principal Prepayments made thereon during such month shall be the property of
the Trust Fund and accrued interest for such month on the Mortgage Loan for
which the substitution is made and any Principal Prepayments made thereon during
such month shall be the property of the Seller. The Scheduled Principal on a
Substitute Mortgage Loan due on the Due Date in the month of substitution shall
be the property of the Seller and the Scheduled Principal on the Mortgage Loan
for which the substitution is made due on such Due Date shall be the property of
the

                                      -42-

<PAGE>

Trust Fund. Upon acceptance of the Substitute Mortgage Loan (and delivery to the
Custodian of a Request for Release for such Mortgage Loan), the Custodian, as
agent for the Trustee, shall release to the Seller the related Mortgage File
related to any Mortgage Loan released pursuant to the Mortgage Loan Purchase
Agreement or Section 2.04 of this Agreement, as applicable, and shall execute
and deliver all instruments of transfer or assignment, without recourse,
representation or warranty in form as provided to it as are necessary to vest in
the Seller title to and rights under any Mortgage Loan released pursuant to the
Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable. The Seller shall deliver to the Custodian the documents related to
the Substitute Mortgage Loan in accordance with the provisions of the Mortgage
Loan Purchase Agreement or Subsections 2.01(b) and 2.02(b) of this Agreement, as
applicable, with the date of acceptance of the Substitute Mortgage Loan deemed
to be the Closing Date for purposes of the time periods set forth in those
Subsections. The representations and warranties set forth in the Mortgage Loan
Purchase Agreement shall be deemed to have been made by the Seller with respect
to each Substitute Mortgage Loan as of the date of acceptance of such Mortgage
Loan by the Trustee. The Master Servicer shall amend the Mortgage Loan Schedule
to reflect such substitution and shall provide a copy of such amended Mortgage
Loan Schedule to the Trustee, MBIA and the Rating Agencies.

         Section 2.05 ISSUANCE OF CERTIFICATES.

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

         (b) The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Depositor in
and to the REMIC I Regular Interests, and the other assets of REMIC II for the
benefit of the holders of the REMIC II Interests. The Trustee acknowledges
receipt of the REMIC I Regular Interests (which are uncertificated) and the
other assets of REMIC II and declares that it holds and will hold the same in
trust for the exclusive use and benefit of the holders of the REMIC II
Interests.

         (c) The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Depositor in
and to the REMIC II Regular Interests, and the other assets of REMIC III for the
benefit of the holders of the REMIC III Certificates. The Trustee acknowledges
receipt of the REMIC II Regular Interests (which are uncertificated) and the
other assets of REMIC III and declares that it holds and will hold the same in
trust for the exclusive use and benefit of the holders of the REMIC III
Certificates.

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

                                      -43-

<PAGE>

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

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

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

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

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

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

                  (vii) immediately prior to the transfer and assignment to the
Trustee, each Mortgage Note and each Mortgage were not subject to an assignment
or pledge, and the Depositor had good and marketable title to and was the sole
owner thereof and had full right to transfer and sell

                                      -44-

<PAGE>

such Mortgage Loan to the Trustee free and clear of any encumbrance, equity,
lien, pledge, charge, claim or security interest.

                                      -45-

<PAGE>

                                   ARTICLE III
                 Administration and Servicing of Mortgage Loans

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

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

         The Trustee shall provide access to the records and documentation in
possession of the Trustee regarding the related Mortgage Loans and REO Property
and the servicing thereof to the Certificateholders, MBIA the FDIC, and the
supervisory agents and examiners of the FDIC, such access being afforded only
upon reasonable prior written request and during normal business hours at the
office of the Trustee; provided, however, that, unless otherwise required by
law, the Trustee shall not be required to provide access to such records and
documentation if the provision thereof would violate the legal right to privacy
of any Mortgagor. The Trustee shall allow representatives of the above entities
to photocopy any of the records and documentation and shall provide equipment
for that purpose at a charge that covers the Trustee's actual costs.

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

                                      -46-

<PAGE>

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

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

         (b) The Master Servicer, for the benefit of the Trustee, the
Certificateholders and MBIA, shall enforce the obligations of each Servicer
under the related Servicing Agreement, and shall, in the event that a Servicer
fails to perform its obligations in accordance with the related Servicing
Agreement, subject to the preceding paragraph, terminate the rights and
obligations of such Servicer thereunder and act as servicer of the related
Mortgage Loans or to cause the Trustee to enter in to a new Servicing Agreement
with a successor Servicer selected by the Master Servicer; provided, however, it
is understood and acknowledged by the parties hereto that there will be a period
of transition (not to exceed 90 days) before the actual servicing functions can
be fully transferred to such successor Servicer. Such enforcement, including,
without limitation, the legal prosecution of claims, termination of Servicing
Agreements and the pursuit of other appropriate remedies, shall be in such form
and carried out to such an extent and at such time as the Master Servicer, in
its good faith business judgment, would require were it the owner of the related
Mortgage Loans. The Master Servicer shall pay the costs of such enforcement at
its own expense, provided that the Master Servicer shall not be required to
prosecute or defend any legal action except to the extent that the Master
Servicer shall have received reasonable indemnity for its costs and expenses in
pursuing such action.

         (c) To the extent that the costs and expenses of the Master Servicer
related to any termination of a Servicer, appointment of a successor Servicer or
the transfer and assumption of servicing by the Master Servicer with respect to
any Servicing Agreement (including, without limitation, (i) all legal costs and
expenses and all due diligence costs and expenses associated with an evaluation
of the potential termination of the Servicer as a result of an event of default
by such Servicer and (ii) all costs and expenses associated with the complete
transfer of servicing, including

                                      -47-

<PAGE>

all servicing files and all servicing data and the completion, correction or
manipulation of such servicing data as may be required by the successor servicer
to correct any errors or insufficiencies in the servicing data or otherwise to
enable the successor service to service the Mortgage Loans in accordance with
the related Servicing Agreement) are not fully and timely reimbursed by the
terminated Servicer, the Master Servicer shall be entitled to reimbursement of
such costs and expenses from the Master Servicer Collection Account.

         (d) The Master Servicer shall require each Servicer to comply with the
remittance requirements and other obligations set forth in the related Servicing
Agreement.

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

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

         Section 3.05 POWER TO ACT; PROCEDURES. The Master Servicer shall master
service the Mortgage Loans and shall have full power and authority, subject to
the REMIC Provisions and the provisions of Article X hereof, to do any and all
things that it may deem necessary or desirable in connection with the master
servicing and administration of the Mortgage Loans, including but not limited to
the power and authority (i) to execute and deliver, on behalf of the
Certificateholders and the Trustee, customary consents or waivers and other
instruments and documents, (ii) to consent to transfers of any Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages, (iii) to
collect any Insurance Proceeds and Liquidation Proceeds, and (iv) to effectuate
foreclosure or other conversion of the ownership of the Mortgaged Property
securing any Mortgage Loan, in each case, in accordance with the provisions of
this Agreement and the related Servicing Agreement, as applicable; provided,
however, that the Master Servicer shall not (and, consistent with its
responsibilities under Section 3.03, shall not permit any Servicer to) knowingly
or intentionally take any action, or fail to take (or fail to cause to be taken)
any action reasonably within its control and the scope of duties more
specifically set forth herein, that, under the REMIC Provisions, if taken or not
taken, as the case may be, would cause any REMIC to fail to qualify as a REMIC
or result in the imposition of a tax upon the Trust Fund (including but not
limited to the tax on prohibited transactions as defined in Section 860F(a)(2)
of the Code and the tax on contributions to a REMIC set forth in Section 860G(d)
of the Code) unless the Master Servicer and MBIA have received an Opinion of
Counsel (but not at the expense of the Master Servicer) to the effect that the
contemplated action would not cause any REMIC to fail to qualify as a REMIC or
result in the imposition of a tax upon any REMIC. The Trustee shall furnish the
Master Servicer, upon written request from a Servicing Officer, with any powers
of attorney empowering the Master Servicer or any Servicer to execute and
deliver instruments of satisfaction or cancellation, or of partial or full
release or discharge, and to foreclose upon or otherwise liquidate Mortgaged
Property, and to appeal, prosecute or defend in any court action relating to the
Mortgage Loans or the Mortgaged Property, in accordance with the applicable
Servicing Agreement and this Agreement, and the Trustee shall

                                      -48-

<PAGE>

execute and deliver such other documents, as the Master Servicer may request, to
enable the Master Servicer to master service and administer the Mortgage Loans
and carry out its duties hereunder, in each case in accordance with Accepted
Master Servicing Practices (and the Trustee shall have no liability for misuse
of any such powers of attorney by the Master Servicer or any Servicer). If the
Master Servicer or the Trustee has been advised that it is likely that the laws
of the state in which action is to be taken prohibit such action if taken in the
name of the Trustee or that the Trustee would be adversely affected under the
"doing business" or tax laws of such state if such action is taken in its name,
the Master Servicer shall join with the Trustee in the appointment of a
co-trustee pursuant to Section 9.11 hereof. In the performance of its duties
hereunder, the Master Servicer shall be an independent contractor and shall not,
except in those instances where it is taking action in the name of the Trustee,
be deemed to be the agent of the Trustee.

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

         Section 3.07 RELEASE OF MORTGAGE FILES. (a) Upon becoming aware of the
payment in full of any Mortgage Loan, or the receipt by any Servicer of a
notification that payment in full has been escrowed in a manner customary for
such purposes for payment to Certificateholders on the next Distribution Date,
the Servicer will, if required under the applicable Servicing Agreement (or if
the Servicer does not, the Master Servicer may), promptly furnish to the
Custodian, on behalf of the Trustee, two copies of a certification substantially
in the form of Exhibit D hereto signed by a Servicing Officer or in a mutually
agreeable electronic format which will, in lieu of a signature on its face,
originate from a Servicing Officer (which certification shall include a
statement to the effect that all amounts received in connection with such
payment that are required to be deposited in the Protected Account maintained by
the applicable Servicer pursuant to Section 4.01 or by the applicable Servicer
pursuant to its Servicing Agreement have been or will be so deposited) and shall
request that the Custodian, on behalf of the Trustee, deliver to the applicable
Servicer the related Mortgage File. Upon receipt of such certification and
request, the Custodian, on behalf of the Trustee, shall promptly release the
related Mortgage File to the applicable Servicer and the Trustee and Custodian
shall have no further responsibility with regard to such Mortgage File. Upon any
such payment in full, each Servicer is authorized, to give, as agent for the
Trustee, as the mortgagee under the Mortgage that secured the Mortgage Loan, an
instrument of satisfaction (or assignment of mortgage without recourse)
regarding the Mortgaged Property subject to the Mortgage, which instrument of
satisfaction or assignment, as the case may be, shall be delivered to the Person
or Persons entitled thereto against receipt therefor of such payment, it being
understood and agreed that no expenses incurred in connection with such
instrument of satisfaction or assignment, as the case may be, shall be
chargeable to the Protected Account.

         (b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with the applicable Servicing
Agreement, the Trustee shall execute such documents as shall be prepared and
furnished to the Trustee by a Servicer or the Master Servicer (in

                                      -49-

<PAGE>

form reasonably acceptable to the Trustee) and as are necessary to the
prosecution of any such proceedings. The Custodian, on behalf of the Trustee,
shall, upon the request of a Servicer or the Master Servicer, and delivery to
the Custodian, on behalf of the Trustee, of two copies of a request for release
signed by a Servicing Officer substantially in the form of Exhibit D (or in a
mutually agreeable electronic format which will, in lieu of a signature on its
face, originate from a Servicing Officer), release the related Mortgage File
held in its possession or control to the Servicer or the Master Servicer, as
applicable. Such trust receipt shall obligate the Servicer or the Master
Servicer to return the Mortgage File to the Custodian on behalf of the Trustee,
when the need therefor by the Servicer or the Master Servicer no longer exists
unless the Mortgage Loan shall be liquidated, in which case, upon receipt of a
certificate of a Servicing Officer similar to that hereinabove specified, the
Mortgage File shall be released by the Custodian, on behalf of the Trustee, to
the Servicer or the Master Servicer.

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

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

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

                                      -50-

<PAGE>

and payable to the Master Servicer or such Servicer under this Agreement or the
applicable Servicing Agreement.

         Section 3.09 STANDARD HAZARD INSURANCE AND FLOOD INSURANCE POLICIES.

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

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

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

         Section 3.11 MAINTENANCE OF THE PRIMARY MORTGAGE INSURANCE POLICIES.

         (a) The Master Servicer shall not take, or permit any Servicer (to the
extent such action is prohibited under the applicable Servicing Agreement) to
take, any action that would result in noncoverage under any applicable Primary
Mortgage Insurance Policy of any loss which, but for the actions of the Master
Servicer or such Servicer, would have been covered thereunder. The Master
Servicer shall use its best reasonable efforts to cause each Servicer (to the
extent required under the related Servicing Agreement) to keep in force and
effect (to the extent that the Mortgage Loan

                                      -51-

<PAGE>

requires the Mortgagor to maintain such insurance), primary mortgage insurance
applicable to each Mortgage Loan in accordance with the provisions of this
Agreement and the related Servicing Agreement, as applicable. The Master
Servicer shall not, and shall not permit any Servicer (to the extent required
under the related Servicing Agreement) to, cancel or refuse to renew any such
Primary Mortgage Insurance Policy that is in effect at the date of the initial
issuance of the Mortgage Note and is required to be kept in force hereunder
except in accordance with the provisions of this Agreement and the related
Servicing Agreement, as applicable.

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

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

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

         Section 3.13 REALIZATION UPON DEFAULTED MORTGAGE LOANS. The Master
Servicer shall cause each Servicer (to the extent required under the related
Servicing Agreement) to foreclose upon, repossess or otherwise comparably
convert the ownership of Mortgaged Properties securing such of the Mortgage
Loans as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments, all in
accordance with the applicable Servicing Agreement.

         Section 3.14 COMPENSATION FOR THE MASTER SERVICER.

         The Master Servicer will be entitled to all income and gain realized
from any investment of funds in the Distribution Account and the Master Servicer
Collection Account, pursuant to Article IV, for the performance of its
activities hereunder. Servicing compensation in the form of assumption fees, if
any, late payment charges, as collected, if any, or otherwise (but not including
any prepayment premium or penalty) shall be retained by the applicable Servicer
and shall not be

                                      -52-

<PAGE>

deposited in the Protected Account. The Master Servicer shall be required to pay
all expenses incurred by it in connection with its activities hereunder and
shall not be entitled to reimbursement therefor except as provided in this
Agreement.

         Section 3.15 REO PROPERTY.

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

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

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

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

         Section 3.16 ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.

         (a) The Master Servicer shall deliver to the Trustee, MBIA and the
Rating Agencies on or before March 1 of each year, commencing on March 1, 2004,
an Officer's Certificate, certifying that with respect to the period ending
December 31 of the prior year: (i) such Servicing Officer has reviewed the
activities of such Master Servicer during the preceding calendar year or portion
thereof and its performance under this Agreement, (ii) to the best of such
Servicing Officer's knowledge, based on such review, such Master Servicer has
performed and fulfilled its duties, responsibilities and obligations under this
Agreement in all material respects throughout such year, or, if there has

                                      -53-

<PAGE>

been a default in the fulfillment of any such duties, responsibilities or
obligations, specifying each such default known to such Servicing Officer and
the nature and status thereof, (iii) nothing has come to the attention of such
Servicing Officer to lead such Servicing Officer to believe that any Servicer
has failed to perform any of its duties, responsibilities and obligations under
its Servicing Agreement in all material respects throughout such year, or, if
there has been a material default in the performance or fulfillment of any such
duties, responsibilities or obligations, specifying each such default known to
such Servicing Officer and the nature and status thereof.

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

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

         Section 3.18 REPORTS FILED WITH SECURITIES AND EXCHANGE COMMISSION.
Within 15 days after each Distribution Date, the Securities Administrator shall,
in accordance with industry standards, file with the Commission via the
Electronic Data Gathering and Retrieval System ("EDGAR"), a Form 8-K with a copy
of the statement to the Certificateholders for such Distribution Date as an
exhibit thereto. Prior to January 30 in any year, the Securities Administrator
shall, in accordance with industry standards and only if instructed by the
Depositor, file a Form 15 Suspension Notice with respect to the Trust Fund, if
applicable. Prior to (i) March 15, 2004 and (ii) unless and until a Form 15
Suspension Notice shall have been filed, prior to March 15 of each year
thereafter, the Master Servicer shall provide the Securities Administrator with
a Master Servicer Certification, together with a copy of the annual independent
accountant's servicing report of each Servicer (or, in the case of U.S. Central,
its sub-servicers) and annual statement of compliance of each Servicer (and, in
the

                                      -54-

<PAGE>

case of U.S. Central, its sub-servicers), in each case, required to be delivered
pursuant to the related Servicing Agreement, and, if applicable, the annual
independent accountant's servicing report and annual statement of compliance to
be delivered by the Master Servicer pursuant to Sections 3.16 and 3.17. Prior to
(i) March 31, 2004, or such earlier filing date as may be required by the
Commission, and (ii) unless and until a Form 15 Suspension Notice shall have
been filed, March 31 of each year thereafter, or such earlier filing date as may
be required by the Commission, the Securities Administrator shall file a Form
10-K, in substance conforming to industry standards, with respect to the Trust.
Such Form 10-K shall include the Master Servicer Certification and other
documentation provided by the Master Servicer pursuant to the second preceding
sentence. The Depositor hereby grants to the Securities Administrator a limited
power of attorney to execute and file each such document on behalf of the
Depositor. Such power of attorney shall continue until either the earlier of (i)
receipt by the Securities Administrator from the Depositor of written
termination of such power of attorney and (ii) the termination of the Trust
Fund. The Depositor agrees to promptly furnish to the Securities Administrator,
from time to time upon request, such further information, reports and financial
statements within its control related to this Agreement and the Mortgage Loans
as the Securities Administrator reasonably deems appropriate to prepare and file
all necessary reports with the Commission. The Securities Administrator shall
have no responsibility to file any items other than those specified in this
Section 3.18; provided, however, the Securities Administrator will cooperate
with the Depositor in connection with any additional filings with respect to the
Trust Fund as the Depositor deems necessary under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). Fees and expenses incurred by the
Securities Administrator in connection with this Section 3.18 shall not be
reimbursable from the Trust Fund.

         Section 3.19 THE COMPANY. On the Closing Date, the Company will receive
from the Depositor a payment of $5,000.

         Section 3.20 UCC. The Depositor shall inform the Trustee in writing of
any Uniform Commercial Code financing statements that were filed on the Closing
Date in connection with the Trust with stamped recorded copies of such financing
statements to be delivered to the Trustee promptly upon receipt by the
Depositor. The Trustee agrees to monitor and notify the Depositor if any
continuation statements for such Uniform Commercial Code financing statements
need to be filed. If directed by the Depositor in writing, the Trustee will file
any such continuation statements solely at the expense of the Depositor. The
Depositor shall file any financing statements or amendments thereto required by
any change in the Uniform Commercial Code.

         Section 3.21 OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS.

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

                                      -55-

<PAGE>

in which case the option shall again become exercisable as of the first day of
the related Calendar Quarter.

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

                                      -56-

<PAGE>

                                   ARTICLE IV
                                    Accounts

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

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

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

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

                                      -57-

<PAGE>

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

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

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

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

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

                  (i) Any amounts withdrawn from a Protected Account;

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

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

                  (iv) The Repurchase Price with respect to any Mortgage Loans
purchased by the Seller pursuant to the Mortgage Loan Purchase Agreement or
Sections 2.02 or 2.03 hereof, any amounts which are to be treated pursuant to
Section 2.04 of this Agreement as the payment of a Repurchase Price in
connection with the tender of a Substitute Mortgage Loan by the Seller, the
Repurchase Price with respect to any Mortgage Loans purchased by the Company
pursuant to Section 3.21, and all proceeds of any Mortgage Loans or property
acquired with respect thereto repurchased by the Depositor or its designee
pursuant to Section 10.01;

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

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

                                      -58-

<PAGE>

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

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

         Section 4.03 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE MASTER
SERVICER COLLECTION ACCOUNT. (a) The Master Servicer will, from time to time on
demand of a Servicer or the Securities Administrator, make or cause to be made
such withdrawals or transfers from the Master Servicer Collection Account as the
Master Servicer has designated for such transfer or withdrawal pursuant to this
Agreement and the related Servicing Agreement. The Master Servicer may clear and
terminate the Master Servicer Collection Account pursuant to Section 10.01 and
remove amounts from time to time deposited in error.

         (b) On an ongoing basis, the Master Servicer shall withdraw from the
Master Servicer Collection Account (i) any expenses, costs and liabilities
recoverable by the Trustee, the Master Servicer or the Securities Administrator
or the Custodian pursuant to Sections 3.03, 7.04 and 9.05 and (ii) any amounts
payable to the Master Servicer as set forth in Section 3.14; provided however,
that the Master Servicer shall be obligated to pay from its own funds any
amounts which it is required to pay under Section 7.03(a).

                                      -59-

<PAGE>

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

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

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

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

         (c) The Distribution Account shall constitute a trust account of the
Trust Fund segregated on the books of the Trustee and held by the Trustee in
trust in its Corporate Trust Office, and the Distribution Account and the funds
deposited therein shall not be subject to, and shall be protected from, all
claims, liens, and encumbrances of any creditors or depositors of the Trustee or
the Master Servicer (whether made directly, or indirectly through a liquidator
or receiver of the Trustee or the Master Servicer). The Distribution Account
shall be an Eligible Account. The amount at any time credited to the
Distribution Account shall be (i) held in cash and fully insured by the FDIC to
the maximum coverage provided thereby or (ii) invested in the name of the
Trustee, in such Permitted Investments as may be selected by the Master Servicer
or deposited in demand deposits with such depository institutions as may be
selected by the Master Servicer, provided that time deposits of such depository
institutions would be a Permitted Investment. All Permitted Investments shall
mature or be subject to redemption or withdrawal on or before, and shall be held
until, the next succeeding Distribution Date if the obligor for such Permitted
Investment is the Trustee or, if such obligor is any other Person, the Business
Day preceding such Distribution Date. All investment earnings on amounts on
deposit in the Distribution Account or benefit from funds uninvested therein
from time to time shall be for the account of the Master Servicer. The Master
Servicer shall be permitted to withdraw or receive distribution of any and all
investment earnings from the Distribution Account on each Distribution Date. If
there is any loss on a Permitted Investment or demand deposit, the Master
Servicer shall remit the amount of the loss to the Trustee who shall deposit
such amount in the Distribution Account. With respect to the Distribution
Account and the funds deposited therein, the Master Servicer shall take such
action as may be necessary to ensure that the Certificateholders shall be
entitled to the priorities afforded to such a trust account (in addition to a
claim against the estate of the Trustee) as provided by 12 U.S.C. ss. 92a(e),
and applicable regulations pursuant thereto, if applicable, or any applicable
comparable state statute applicable to state chartered banking corporations.

         Section 4.05 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE DISTRIBUTION
ACCOUNT. (a) The Trustee will, from time to time on demand of the Master
Servicer or the Securities Administrator, make or cause to be made such
withdrawals or transfers from the Distribution Account as the Master

                                      -60-

<PAGE>

Servicer has designated for such transfer or withdrawal pursuant to this
Agreement and the Servicing Agreements or as the Securities Administrator has
instructed hereunder for the following purposes (limited in the case of amounts
due the Master Servicer to those not withdrawn from the Master Servicer
Collection Account in accordance with the terms of this Agreement):

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

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

                  (iii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds relating to a particular Mortgage Loan for insured expenses
incurred with respect to such Mortgage Loan and to reimburse the Master Servicer
or such Servicer from Liquidation Proceeds from a particular Mortgage Loan for
Liquidation Expenses incurred with respect to such Mortgage Loan; provided that
the Master Servicer shall not be entitled to reimbursement for Liquidation
Expenses with respect to a Mortgage Loan to the extent that (i) any amounts with
respect to such Mortgage Loan were paid as Excess Liquidation Proceeds pursuant
to clause (xi) of this Subsection 4.03 (a) to the Master Servicer; and (ii) such
Liquidation Expenses were not included in the computation of such Excess
Liquidation Proceeds;

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

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

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

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

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

                                      -61-

<PAGE>

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

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

                  (xi) to remove amounts deposited in error; and

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

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

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

                                      -62-

<PAGE>

                                    ARTICLE V
                                  Certificates

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

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

         All transfers by Certificate Owners of such respective Classes of
Book-Entry Certificates and any Global Certificates shall be made in accordance
with the procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer Book-Entry Certificates of Certificate Owners it represents or of
brokerage firms for which it acts as agent in accordance with the Depository's
normal procedures.

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

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

                                      -63-

<PAGE>

  REMIC I Interest    Initial Balance     Pass-Through Rate    Related Subgroup

        1-A            $      12,682.81         5.50%             Subgroup 1
        2-A            $       2,170.40         8.00%             Subgroup 2
         PO            $   3,191,802.14         0.00%             Subgroup 1
       1-ZZZ           $ 359,606,249.05         5.50%             Subgroup 1
       2-ZZZ           $  61,539,261.01         8.00%             Subgroup 2
        R-I            $          50.00         5.50%             Subgroup 1

      Distributions of principal shall be deemed to be made to the REMIC I
Regular Interests, in each case from the related Subgroup, first, to each REMIC
I Regular Interest ending with the designation "A," so that the Uncertificated
Principal Balance of each such REMIC I Regular Interest is equal to 0.1% of the
excess of (x) the aggregate Scheduled Principal Balance of the Mortgage Loans in
the related Subgroup over (y) the Current Principal Amount of the Senior
Certificate in such Subgroup (except that if any such excess is a larger number
than in the preceding distribution period, the least amount of principal shall
be distributed to such REMIC I Regular Interests such that the REMIC I
Subordinated Balance Ratio is maintained); and second, any remaining principal
in each Subgroup to the related REMIC I Regular Interest ending with the
designation ZZZ (provided that a portion of the remaining principal equal to the
Class PO Certificate Principal Distribution Amount attributable to the Discount
Mortgage Loans will be distributed to REMIC I Regular Interest PO). Realized
Losses from each Subgroup shall be applied after all distributions have been
made on each Distribution Date, first, to the related REMIC I Regular Interest
ending with the designation "A," so that the Uncertificated Principal Balance of
each such REMIC I Regular Interest is equal to 0.1% of the excess of (x) the
aggregate Scheduled Principal Balance of the Mortgage Loans in the related
Subgroup over (y) the Current Principal Amount of the Senior Certificate in the
related Subgroup (except that if any such excess is a larger number than in the
preceding distribution period, the least amount of Realized Losses shall be
applied to such REMIC I Regular Interests such that the REMIC I Subordinated
Balance Ratio is maintained); and second, any remaining Realized Losses from
each Subgroup shall be allocated to the related REMIC I Regular Interests ending
with the designation ZZZ (except that if a Realized Loss is recognized with
respect to a Discount Mortgage Loan, the applicable portion of such Realized
Loss will be allocated to REMIC I Regular Interest PO).

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

                                      -64-

<PAGE>

<TABLE>
<CAPTION>
 REMIC II Interest        Initial Balance        Pass-Through Rate                  Related Subgroup
 -----------------        ---------------        -----------------                  ----------------
<S>                      <C>                           <C>                             <C>
        A-1              $ 203,317,273.00              5.25%                           Subgroup 1
        A-2               $ 40,000,000.00              5.50%                           Subgroup 1
        A-3               $ 20,331,727.00              8.00%                           Subgroup 1
        A-5               $ 31,287,019.00              5.50%                           Subgroup 1
        A-6               $ 17,000,000.00              5.50%                           Subgroup 1
        A-7               $ 59,371,027.04              8.00%                           Subgroup 2
        A-9               $ 35,000,000.00              5.50%                           Subgroup 1
         PO               $ 3,191,802.14               0.00%                           Subgroup 1
        R-II                  $ 50.00                  5.50%                           Subgroup 1
       R-III                  $ 50.00                  5.50%                           Subgroup 1
        B-1               $ 6,578,000.00                (1)                               N/A
        B-2               $ 3,182,000.00                (1)                               N/A
         B-3              $ 1,698,000.00                (1)                               N/A
        B-4               $ 1,485,000.00                (1)                               N/A
        B-5               $ 1,061,000.00                (1)                               N/A
        B-6                $ 849,217.23                 (1)                               N/A
</TABLE>

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

(1) The Pass-Through Rate on the Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates will be a per annum rate equal to the
weighted average of the Pass-Through Rates on REMIC I Regular Interest 1-A and
REMIC I Regular Interest 2-A, weighted on the basis of the Uncertificated
Principal Balance of each such REMIC I Regular Interest.

      Interest shall be payable to the REMIC II Regular Interests at the
applicable Pass-Through Rate on the related Uncertificated Principal Balance.
Principal shall be payable to, and shortfalls, losses and prepayments are
allocable to, the REMIC II Regular Interests as such amounts are payable and
allocable to the Corresponding Certificates.

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

           DESIGNATION              INITIAL PRINCIPAL       PASS-THROUGH RATE
           -----------                  AMOUNT              -----------------
                                        ------
               A-1                $      203,317,273             5.2500%
               A-2                $       40,000,000             5.5000%
               A-3                $       20,331,727               (1)
               A-4                $              (2)               (3)
               A-5                $       31,287,019             5.5000%
               A-6                $       17,000,000             5.5000%
               A-7                $       59,371,027               (4)
               A-8                $              (5)               (6)
               A-9                $       35,000,000             5.5000%
               PO                 $        3,191,802             0.0000%
               R-I                $               50             5.5000%
              R-II                $               50             5.5000%
              R-III               $               50             5.5000%
               B-1                $        6,578,000               (7)
               B-2                $        3,182,000               (7)
               B-3                $        1,698,000               (7)
               B-4                $        1,485,000               (7)

                                      -65-

<PAGE>

               B-5                $        1,061,000               (7)
               B-6                $          849,217               (7)

         (1)      The Class A-3 Certificates will bear interest at a
                  Pass-Through Rate equal to approximately 1.6700% per annum for
                  the first Distribution Date, and thereafter at an adjustable
                  Pass-Through Rate equal to 0.5500% per annum plus LIBOR,
                  subject to a minimum rate of 0.5500% per annum and a maximum
                  rate equal to 8.0000% per annum.

         (2)      The Class A-4 Certificates do not have an initial Current
                  Principal Amount. The Class A-4 Certificates have an initial
                  Notional Amount of $20,331,727. For federal income tax
                  purposes, the Class A-4 Certificates will have a Notional
                  Amount equal to REMIC II Regular Interest A-3.

         (3)      The Class A-4 Certificates will bear interest at a
                  Pass-Through Rate equal to approximately 6.3300% per annum for
                  the first Distribution Date, and thereafter at an adjustable
                  Pass-Through Rate equal to 7.4500% per annum minus LIBOR,
                  subject to a minimum rate of 0.0000% per annum and a maximum
                  rate equal to 7.4500% per annum.

         (4)      The Class A-7 Certificates will bear interest at a
                  Pass-Through Rate equal to approximately 1.7200% per annum for
                  the first Distribution Date, and thereafter at an adjustable
                  Pass-Through Rate equal to 0.6000% per annum plus LIBOR,
                  subject to a minimum rate of 0.6000% per annum and a maximum
                  rate equal to 8.0000% per annum.

         (5)      The Class A-8 Certificates will bear interest at a
                  Pass-Through Rate equal to approximately 6.2800% per annum for
                  the first Distribution Date, and thereafter at an adjustable
                  Pass-Through Rate equal to 7.4000% per annum minus LIBOR,
                  subject to a minimum rate of 0.0000% per annum and a maximum
                  rate equal to 7.4000% per annum.

         (6)      The Class A-8 Certificates do not have an initial Current
                  Principal Amount. The Class A-8 Certificates have an initial
                  Notional Amount of $59,371,027. For federal income tax
                  purposes, the Class A-7 Certificates will have a Notional
                  Amount equal to REMIC II Regular Interest A-7.

         (7)      The Class B Certificates will each bear interest at a variable
                  pass-through rate equal to the weighted average of 5.500% and
                  8.000% per annum, weighted on the basis of the aggregate
                  Scheduled Principal Balance of the Mortgage Loans included in
                  Subgroup 1 and Subgroup 2, respectively (other than the PO
                  Percentage of the Scheduled Principal Balance of such Mortgage
                  Loans), minus the aggregate Current Principal Amount of the
                  Subgroup 1 and Subgroup 2 Certificates, respectively. The
                  Pass- Through Rate for the initial Interest Accrual Period is
                  approximately 5.8653% per annum. For federal income tax
                  purposes, however, the Class B Certificates will bear interest
                  at a variable Pass-Through Rate equal to the weighted average
                  of the Pass-Through Rates on REMIC II Regular Interests B-1,
                  B- 2, B-3, B-4, B-5 and B-6, weighted on the basis of the
                  Uncertificated Principal Balance of each such REMIC I Regular
                  Interest immediately preceding the related Distribution Date.

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

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

                                      -66-

<PAGE>

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

         (g) Each Class of Book-Entry Certificates will be registered as a
single Certificate of such Class held by a nominee of the Depository or the DTC
Custodian, and beneficial interests will be held by investors through the
book-entry facilities of the Depository in minimum denominations of (i) in the
case of the Senior Certificates (other than the Residual Certificates), $1,000
and in each case increments of $1.00 in excess thereof, and (ii) in the case of
the Offered Subordinate Certificates, $25,000 and increments of $1.00 in excess
thereof, except that one Certificate of each such Class may be issued in a
different amount so that the sum of the denominations of all outstanding
Certificates of such Class shall equal the Current Principal Amount of such
Class on the Closing Date. On the Closing Date, the Trustee shall execute and
countersign Physical Certificates all in an aggregate principal amount that
shall equal the Current Principal Amount of such Class on the Closing Date. The
Private Certificates shall be issued in certificated fully-registered form in
minimum dollar denominations of $25,000 and integral multiples of $1.00 in
excess thereof, except that one Private Certificate of each Class may be issued
in a different amount so that the sum of the denominations of all outstanding
Private Certificates of such Class shall equal the Current Principal Amount of
such Class on the Closing Date. The Class R-I, Class R-II and Class R-III
Certificate shall each be issued in certificated fully-registered form, each, in
the denomination of $50. Each Class of Global Certificates, if any, shall be
issued in fully registered form in minimum dollar denominations of $50,000 and
integral multiples of $1.00 in excess thereof, except that one Certificate of
each Class may be in a different denomination so that the sum of the
denominations of all outstanding Certificates of such Class shall equal the
Current Principal Amount of such Class on the Closing Date. On the Closing Date,
the Trustee shall execute and countersign (i) in the case of each Class of
Offered Certificates, the Certificate in the entire Current Principal Amount of
the respective Class and (ii) in the case of each Class of Private Certificates,
Individual Certificates all in an aggregate principal amount that shall equal
the Current Principal Amount of each such respective Class on the Closing Date.
The Certificates referred to in clause (i) and if at any time there are to be
Global Certificates, the Global Certificates shall be delivered by the Depositor
to the Depository or pursuant to the Depository's instructions, shall be
delivered by the Depositor on behalf of the Depository to and deposited with the
DTC Custodian. The Trustee shall sign the Certificates

                                      -67-

<PAGE>

by facsimile or manual signature and countersign them by manual signature on
behalf of the Trustee by one or more authorized signatories, each of whom shall
be Responsible Officers of the Trustee or its agent. A Certificate bearing the
manual and facsimile signatures of individuals who were the authorized
signatories of the Trustee or its agent at the time of issuance shall bind the
Trustee, notwithstanding that such individuals or any of them have ceased to
hold such positions prior to the delivery of such Certificate.

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

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

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

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

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

                  THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY
         BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
         ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
         INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE
         INTERNAL REVENUE CODE OF 1986, AS AMENDED, UNLESS THE PROPOSED
         TRANSFEREE PROVIDES THE TRUSTEE WITH AN OPINION OF COUNSEL ADDRESSED TO
         THE DEPOSITOR, TRUSTEE, MASTER SERVICER AND SECURITIES ADMINISTRATOR
         AND ON WHICH THEY MAY RELY THAT IS SATISFACTORY TO THE TRUSTEE THAT THE
         PURCHASE OF CERTIFICATES ON BEHALF OF SUCH PERSON WILL NOT RESULT IN OR
         CONSTITUTE A NONEXEMPT PROHIBITED TRANSACTION, IS PERMISSIBLE UNDER
         APPLICABLE LAW AND WILL NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON
         THE PART OF THE DEPOSITOR, THE MASTER SERVICER, THE SECURITIES
         ADMINISTRATOR OR THE TRUSTEE.

                                      -68-

<PAGE>

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

         THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE PROPOSED TRANSFER AND
HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND OPERATION OF THE
TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH IS
NOT COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION,
INCLUDING, BUT NOT LIMITED TO, PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14,
PTE 91-38, PTE 90-1, PTE 95-60 OR PTE 96-23 AND (II) WILL NOT GIVE RISE TO ANY
ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE SECURITIES
ADMINISTRATOR, THE MASTER SERVICER OR THE TRUSTEE, WHICH WILL BE DEEMED
REPRESENTED BY AN OWNER OF A BOOK- ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE OR
UNLESS THE OPINION SPECIFIED IN SECTION 5.07 OF THE AGREEMENT IS PROVIDED.

         Section 5.02 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES. (a)
The Trustee shall maintain at its Corporate Trust Office a Certificate Register
in which, subject to such reasonable regulations as it may prescribe, the
Trustee shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided.

         (b) Subject to Subsection 5.01(a) and, in the case of any Global
Certificate or Physical Certificate upon the satisfaction of the conditions set
forth below, upon surrender for registration of transfer of any Certificate at
any office or agency of the Trustee maintained for such purpose, the Trustee
shall sign, countersign and shall deliver, in the name of the designated
transferee or transferees, a new Certificate of a like Class and aggregate
Fractional Undivided Interest, but bearing a different number.

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

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

                  (ii) The Trustee shall register the transfer of any Individual
Certificate if (x) the transferor has advised the Trustee in writing that the
Certificate is being transferred to an

                                      -69-

<PAGE>

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

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

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

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

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

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

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

                                      -70-

<PAGE>

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

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

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

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

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

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

         (h) Subject to the restrictions on transfer and exchange set forth in
this Section 5.02, the holder of any Individual Certificate may transfer or
exchange the same in whole or in part (in an initial certificate balance equal
to the minimum authorized denomination set forth in Section 5.01(g) above or any
integral multiple of $1.00 in excess thereof) by surrendering such Certificate
at the Corporate Trust Office, or at the office of any transfer agent, together
with an executed instrument of assignment and transfer satisfactory in form and
substance to the Trustee in the case of transfer and a written request for
exchange in the case of exchange. The holder of a beneficial interest in a
Global Certificate may, subject to the rules and procedures of the Depository,
cause the Depository (or its nominee) to notify the Trustee in writing of a
request for transfer or exchange of such beneficial interest for an Individual
Certificate or Certificates. Following a proper request for transfer or
exchange, the Trustee shall, within five Business Days of such request made at
the Corporate Trust Office, sign, countersign and deliver at the Corporate Trust
Office, to the transferee (in the case of transfer) or holder (in the case of
exchange) or send by first class mail at the risk of the transferee (in the case
of transfer) or holder (in the case of exchange) to such address as the
transferee or

                                      -71-

<PAGE>

holder, as applicable, may request, an Individual Certificate or Certificates,
as the case may require, for a like aggregate Fractional Undivided Interest and
in such authorized denomination or denominations as may be requested. The
presentation for transfer or exchange of any Individual Certificate shall not be
valid unless made at the Corporate Trust Office by the registered holder in
person, or by a duly authorized attorney-in-fact.

         (i) At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized denominations of a like Class and
aggregate Fractional Undivided Interest, upon surrender of the Certificates to
be exchanged at the Corporate Trust Office; provided, however, that no
Certificate may be exchanged for new Certificates unless the original Fractional
Undivided Interest represented by each such new Certificate (i) is at least
equal to the minimum authorized denomination or (ii) is acceptable to the
Depositor as indicated to the Trustee in writing. Whenever any Certificates are
so surrendered for exchange, the Trustee shall sign and countersign and the
Trustee shall deliver the Certificates which the Certificateholder making the
exchange is entitled to receive.

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

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

         (l) The Trustee shall cancel all Certificates surrendered for transfer
or exchange but shall retain such Certificates in accordance with its standard
retention policy or for such further time as is required by the record retention
requirements of the Securities Exchange Act of 1934, as amended, and thereafter
may destroy such Certificates.

         Section 5.03 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. (a) If
(i) any mutilated Certificate is surrendered to the Trustee, or the Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (ii) there is delivered to the Trustee (and with respect to any
Class A-6 Certificates, to MBIA) such security or indemnity as it may require to
save it harmless, and (iii) the Trustee has not received notice that such
Certificate has been acquired by a third Person, the Trustee shall sign,
countersign and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like tenor and
Fractional Undivided Interest but in each case bearing a different number. The
mutilated, destroyed, lost or stolen Certificate shall thereupon be canceled of
record by the Trustee and shall be of no further effect and evidence no rights.

         (b) Upon the issuance of any new Certificate under this Section 5.03,
the Trustee may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Any duplicate Certificate issued pursuant to this Section 5.03 shall constitute

                                      -72-

<PAGE>

complete and indefeasible evidence of ownership in the Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.

         Section 5.04 PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Depositor, the Trustee or MBIA and
any agent of the Depositor, the Trustee or MBIA may treat the Person in whose
name any Certificate is registered as the owner of such Certificate for the
purpose of receiving distributions pursuant to Section 6.01 and for all other
purposes whatsoever. None of the Depositor, the Trustee, MBIA or any agent of
the Depositor, the Trustee or MBIA shall be affected by notice to the contrary.
No Certificate shall be deemed duly presented for a transfer effective on any
Record Date unless the Certificate to be transferred is presented no later than
the close of business on the third Business Day preceding such Record Date.

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

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

                                      -73-

<PAGE>

Certificates are not transferred to any Person who is not a Permitted Transferee
and that any transfer of such Residual Certificates will not cause the
imposition of a tax upon the Trust or cause any REMIC to fail to qualify as a
REMIC.

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

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

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

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

         Section 5.07 ERISA RESTRICTIONS. (a) Subject to the provisions of
subsection (b), no Residual Certificates or Private Certificates may be acquired
directly or indirectly by, or on behalf of, an employee benefit plan or other
retirement arrangement which is subject to Title I of ERISA or Section 4975 of
the Code, unless the proposed transferee provides either (i) the Trustee, with
an Opinion of Counsel addressed to the Depositor, the Trustee, the Master
Servicer and the Securities Administrator (upon which they may rely) which is
satisfactory to the Trustee, which opinion will not be at the expense of the
Depositor, the Trustee, the Master Servicer or the Securities Administrator,
that the purchase of such Certificates by or on behalf of such Plan is
permissible under applicable law, will not constitute or result in a nonexempt
prohibited transaction under ERISA or Section 4975 of the Code and will not
subject the Depositor, the Master Servicer, the Securities Administrator or the
Trustee to any obligation in addition to those undertaken in the Agreement or
(ii) in the case of the Class B-4, Class B-5 and Class B-6 Certificates, a
representation or certification to the Trustee (upon which the Trustee is
authorized to rely) to the effect that the proposed transfer and holding of such
a Certificate and the servicing, management and operation of the Trust: (I) will
not result in a prohibited transaction under Section 406 of ERISA or Section
4975 of the Code which is not covered under an individual or class prohibited
transaction exemption

                                      -74-

<PAGE>

including but not limited to Department of Labor Prohibited Transaction
Exemption ("PTE") 84-14 (Class Exemption for Plan Asset Transactions Determined
by Independent Qualified Professional Asset Managers); PTE 91-38 (Class
Exemption for Certain Transactions Involving Bank Collective Investment Funds);
PTE 90-1 (Class Exemption for Certain Transactions Involving Insurance Company
Pooled Separate Accounts), PTE 95-60 (Class Exemption for Certain Transactions
Involving Insurance Company General Accounts), and PTCE 96-23 (Class Exemption
for Plan Asset Transactions Determined by In-House Asset Managers and (II) will
not subject the Depositor, the Securities Administrator, the Master Servicer or
the Trustee to any obligation in addition to those undertaken in the Agreement.

         (b) Any Person acquiring an interest in a Global Certificate which is a
Private Certificate, by acquisition of such Certificate, shall be deemed to have
represented to the Trustee that in the case of the Class B-4, Class B-5 and
Class B-6 Certificates, either: (i) it is not acquiring an interest in such
Certificate directly or indirectly by, or on behalf of, an employee benefit plan
or other retirement arrangement which is subject to Title I of ERISA or Section
4975 of the Code, or (ii) the transfer and holding of an interest in such
Certificate to that Person and the subsequent servicing, management and
operation of the Trust and its assets: (I) will not result in any prohibited
transaction which is not covered under an individual or class prohibited
transaction exemption, including, but not limited to, PTE 84-14, PTE 91-38, PTE
90-1, PTE 95-60 or PTE 96-23 and (II) will not subject the Depositor, the
Securities Administrator, the Master Servicer or the Trustee to any obligation
in addition to those undertaken in the Agreement.

         (c) Each beneficial owner of a Class B-1, Class B-2 or Class B-3
Certificate or any interest therein shall be deemed to have represented, by
virtue of its acquisition or holding of that certificate or interest therein,
that either (i) it is not a Plan or investing with "Plan Assets", (ii) it has
acquired and is holding such certificate in reliance on Prohibited Transaction
Exemption 90-30, as amended from time to time (the "Exemption"), and that it
understands that there are certain conditions to the availability of the
Exemption, including that the certificate must be rated, at the time of
purchase, not lower than "BBB-" (or its equivalent) by S&P, Fitch Ratings or
Moody's Investors Service, Inc., and the certificate is so rated or (iii) (1) it
is an insurance company, (2) the source of funds used to acquire or hold the
certificate or interest therein is an "insurance company general account," as
such term is defined in Prohibited Transaction Class Exemption ("PTCE") 95-60,
and (3) the conditions in Sections I and III of PTCE 95-60 have been satisfied.

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

                                      -75-

<PAGE>

         Section 5.08 RULE 144A INFORMATION. For so long as any Certificates are
outstanding and are "restricted securities" within the meaning of Rule 144(a)(3)
of the Securities Act, (1) the Depositor will provide or cause to be provided to
any holder of such Certificates and any prospective purchaser thereof designated
by such a holder, upon the request of such holder or prospective purchaser, the
information required to be provided to such holder or prospective purchaser by
Rule 144A(d)(4) under the Securities Act; and (2) the Depositor shall update
such information from time to time in order to prevent such information from
becoming false and misleading and will take such other actions as are necessary
to ensure that the safe harbor exemption from the registration requirements of
the Securities Act under Rule 144A is and will be available for resales of such
Certificates conducted in accordance with Rule 144A.

                                      -76-

<PAGE>

                                   ARTICLE VI
                         Payments to Certificateholders

         Section 6.01 DISTRIBUTIONS ON THE CERTIFICATES. (a) Interest and
principal (as applicable) on the Certificates will be distributed monthly on
each Distribution Date, commencing in November 2003, in an amount equal to the
Available Funds on deposit in the Distribution Account for such Distribution
Date. On each Distribution Date, the Available Funds on deposit in the
Distribution Account shall be distributed as follows:

                  (i) on each Distribution Date, the Group I Available Funds
will be distributed to the Group I Senior Certificates as follows:

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

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

                  THIRD, concurrently as follows:

                           (I)      to the extent of the remaining Available
                                    Funds related to Subgroup 1, to the Class
                                    A-1, Class A-2, Class A-3, Class A-5, Class
                                    A-6, Class A-9, Class R-I, Class R-II and
                                    Class R-III Certificates, as principal, the
                                    Subgroup 1 Principal Distribution Amount in
                                    the order set forth in Section 6.01(h)
                                    below; and

                           (II)     to the extent of the remaining Available
                                    Funds related to Subgroup 2, to the Class
                                    A-7 Certificates, as principal, the Subgroup
                                    2 Principal Distribution Amount, in
                                    reduction of the Current Principal Amount,
                                    until the Current Principal Amount thereof
                                    has been reduced to zero.

                  FOURTH, to the Class PO Certificates, the Class PO Certificate
         Principal Distribution Amount for such Distribution Date to the extent
         of the remaining Available Funds, until the Current Principal Amount
         thereof has been reduced to zero;

                  FIFTH, to the Class PO Certificates, the Class PO Certificate
         Deferred Amount, provided, that (i) on any Distribution Date,
         distributions pursuant to this priority FIFTH shall not exceed the
         excess, if any, of (x) Available Funds remaining after giving effect to
         distributions pursuant to priority FIRST through FOURTH above over (y)
         the sum of the amount of Accrued Certificate Interest for such
         Distribution Date and Accrued Certificate Interest remaining
         undistributed from previous Distribution Dates on all classes of
         Subordinate Certificates then outstanding, (ii) such distributions
         shall not reduce the Current Principal

                                      -77-

<PAGE>

         Amount of the Class PO Certificates and (iii) no distribution will be
         made in respect of the Class PO Certificate Deferred Amount on or after
         the Cross-Over Date; and

                  SIXTH, to the Insurer, the MBIA Reimbursement Amount;

                  (ii) On each Distribution Date on or prior to the Cross-Over
Date, an amount equal to the remaining Available Funds after the distributions
in (i) above will be distributed sequentially in the following order, to the
Class B-1, Class B-2, Class B-3, Class B-4, Class B-5 and Class B-6
Certificates, in each case up to an amount equal to and in the following order:
(a) the Accrued Certificate Interest thereon for such Distribution Date, (b) any
Accrued Certificate Interest thereon remaining undistributed from previous
Distribution Dates and (c) such class's Allocable Share for such Distribution
Date, in each case, to the extent of the remaining Available Funds.

                  (iii) If, after distributions have been made pursuant to
priorities FIRST and SECOND of clause (i) above on any Distribution Date, the
remaining Available Funds related to Subgroup 1 is less than the sum of the
Subgroup 1 and Class PO Principal Distribution Amount, or the remaining
Available Funds related to Subgroup 2 is less than the Subgroup 2 Principal
Distribution Amount, such amounts shall be reduced, and such remaining funds
will be distributed to the related Senior Certificates (other than the Interest
Only Certificates) on the basis of such reduced amounts. Notwithstanding any
reduction in principal distributable to the Class PO Certificates pursuant to
this paragraph, the principal balance of the Class PO Certificates shall be
reduced not only by principal so distributed but also by the difference between
(i) principal distributable to the Class PO Certificates in accordance with
priority FIFTH of clause (i) above, and (ii) principal actually distributed to
the Class PO Certificates after giving effect to this paragraph. The Class PO
Certificate Cash Shortfall for the Class PO Certificates with respect to any
Distribution Date will be added to the Class PO Certificate Deferred Amount.

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

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

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

         (e) If on any Distribution Date the Available Funds for the Senior
Certificates is less than the Accrued Certificate Interest on the related Senior
Certificates for such Distribution Date prior

                                      -78-

<PAGE>

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

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

         (g) Notwithstanding the priorities relating to distributions of
principal among the Insured Certificates described above, on any Distribution
Date, distributions in respect of principal on the Insured Certificates will be
allocated among the Holders of the Insured Certificates as set forth in Section
6.10. On each Distribution Date on which amounts are available for distributions
in reduction of the Current Principal Amount of the Insured Certificates
(including, for purposes of this paragraph, the portion of any Insured Payment
allocable to principal) the aggregate amount available for such distributions
will be rounded upward by the Rounding Amount. Such rounding will be
accomplished on the first Distribution Date on which distributions in reduction
of the Current Principal Amount of the Insured Certificates are made by
withdrawing from the Rounding Account the Rounding Amount for deposit into the
Distribution Account, and such Rounding Amount will be added to the amount that
is available for distributions in reduction of the Current Principal Amount of
the Insured Certificates. On each succeeding Distribution Date on which
distributions in reduction of the Current Principal Amount of the Insured
Certificates are made, first, the aggregate amount available for distribution in
reduction of the Current Principal Amount of the Insured Certificates will be
applied to repay the Rounding Amount withdrawn from the Rounding Account on the
prior Distribution Date and then, the remainder of such allocable amount, if
any, will be similarly rounded upward through another withdrawal from the
Rounding Account and such determined Rounding Amount will be added to the amount
that is available for distribution in reduction of the Current Principal Amount
of the Insured Certificates. Any funds remaining in the Rounding Account after
the Current Principal Amount of the Insured Certificates is reduced to zero
shall be distributed to the Class R-III Certificateholders.

         (h) On each Distribution Date before the Cross-Over Date, an amount, up
to the amount of the Subgroup 1 Principal Distribution Amount for that
Distribution Date, will be distributed as principal as follows:

                  (1)      sequentially to the Class R-I, Class R-II and Class
                           R-III Certificates, in reduction of the Current
                           Principal Amount thereof, in each case until the
                           Current Principal Amount thereof has been reduced to
                           zero;

                                      -79-

<PAGE>

                  (2)      to the Class A-9 Certificates, in reduction of the
                           Current Principal Amount thereof, until the Current
                           Principal Amount thereof has been reduced to zero, in
                           an amount equal to the Lockout Principal Amount;

                  (3)      up to an amount of $17,000, to the Class A-6
                           Certificates, commencing on the Distribution Date in
                           January 2007, in reduction of the Current Principal
                           Amount thereof, until the Current Principal Amount
                           thereof has been reduced to zero:

                  (4)      to the Class A-1, Class A-2 and Class A-3
                           Certificates, concurrently on a pro rata basis, in
                           reduction of the Current Principal Amounts thereof,
                           until the Current Principal Amounts thereof have been
                           reduced to zero;

                  (5)      to the Class A-5 Certificates, in reduction of the
                           Current Principal Amount thereof, until the Current
                           Principal Amount thereof has been reduced to zero;

                  (6)      to the Class A-6 Certificates, in reduction of the
                           Current Principal Amount thereof, until the Current
                           Principal Amount thereof has been reduced to zero;
                           and

                  (7)      to the Class A-9 Certificates, in reduction of the
                           Current Principal Amount thereof, until the Current
                           Principal Amount thereof has been reduced to zero.

         (i) On each Distribution Date after the Cross-Over Date, an amount, up
to the amount of the Subgroup 1 Principal Distribution Amount for that
Distribution Date, will be distributed to the Class A-1, Class A-2, Class A-3,
Class A-5, Class A-6 and Class A-9 Certificates on a pro rata basis, based on
the Current Principal Amounts thereof, until the Current Principal Amounts
thereof have been reduced to zero.

         (j) On each Distribution Date, an amount, up to the amount of the
Subgroup 2 Principal Distribution Amount for that Distribution Date, will be
distributed as principal, to the Class A-7 Certificates, in reduction of the
Current Principal Amount thereof, until the Current Principal Amount thereof has
been reduced to zero.

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

         (b) Realized Losses with respect to a Mortgage Loan will be allocated
on a pro rata basis between the PO Percentage of the Scheduled Principal Balance
of such Mortgage Loan and the Non-PO Percentage of such Scheduled Principal
Balance.

         (c) On each Distribution Date, the PO Percentage of the principal
portion of any Realized Loss on a Discount Mortgage Loan and any Class PO
Certificate Cash Shortfall will be allocated to the Principal Only Certificates
until the Current Principal Amount of those Principal Only

                                      -80-

<PAGE>

Certificates is reduced to zero. With respect to any Distribution Date through
the Cross-Over Date, the aggregate of all amounts so allocable to a class of
Principal Only Certificates on such date in respect of any Realized Losses and
any related Class PO Certificate Cash Shortfall and all amounts previously
allocated in respect of such Realized Losses or Class PO Certificate Cash
Shortfall and not distributed on prior Distribution Dates will be the "Class PO
Certificate Deferred Amount." To the extent funds are available therefor on any
Distribution Date through the Cross-Over Date, distributions in respect of the
Class PO Certificate Deferred Amount for the Class PO Certificates will be made
in accordance with priority FIFTH of Section 6.01(a)(i). No interest will accrue
on the Class PO Certificate Deferred Amount. On each Distribution Date through
the Cross-Over Date, the Current Principal Amount of the lowest ranking Class of
Subordinate Certificates then outstanding will be reduced by the amount of any
distributions in respect of any Class PO Certificate Deferred Amount on such
Distribution Date in accordance with the priorities set forth above, through the
operation of the Subordinate Certificate Writedown Amount. After the Cross-Over
Date, no more distributions will be made in respect of, and applicable Realized
Losses and Class PO Certificate Cash Shortfalls allocable to the Principal Only
Certificates will not be added to, the Class PO Certificate Deferred Amount.

         (d) The Non-PO Percentage of the principal portion of Realized Losses
on the Mortgage Loans will be allocated on any Distribution Date as follows:
first, to the Class B-6 Certificates; second, to the Class B-5 Certificates;
third, to the Class B-4 Certificates; fourth, to the Class B-3 Certificates;
fifth, to the Class B-2 Certificates; and sixth, to the Class B-1 Certificates,
in each case until the Current Principal Amount of such class has been reduced
to zero. The applicable Non-PO Percentage of the principal portion of any Excess
Loss for any Distribution Date will be allocated pro rata among all outstanding
Classes of Certificates (other than the Principal Only Certificates and the
Interest Only Certificates) based on their Current Principal Amounts. Once the
Subordinate Certificates have been reduced to zero, the principal portion of
Realized Losses on the Mortgage Loans (if any) will be allocated on a pro rata
basis to the remaining Senior Certificates (other than the Interest Only
Certificates).

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

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

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

                                      -81-

<PAGE>

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

         (i) Any Net Interest Shortfall will be allocated among the Classes of
Certificates in proportion to the respective amounts of Accrued Certificate
Interest that would have been allocated thereto in the absence of such Net
Interest Shortfall for such Distribution Date. The interest portion of any
Realized Losses with respect to the Mortgage Loans occurring on or prior to the
Cross-Over Date will not be allocated among any Certificates, but will reduce
the amount of Available Funds on the related Distribution Date. As a result of
the subordination of the Subordinate Certificates in right of distribution, such
Realized Losses on the Mortgage Loans will be borne by the Subordinate
Certificates, in inverse order of their numerical Class designations. Following
the Cross- Over Date, the interest portion of Realized Losses on the Mortgage
Loans will be allocated to the Senior Certificates to the extent not covered,
with respect to the Class A-6 Certificates, by the Reserve Fund.

         (j) Any Deficient Valuation will on each Distribution Date be allocated
solely to the Subordinate Certificates until the Bankruptcy Coverage Termination
Date. The Bankruptcy Loss Amount and the related coverage levels may be reduced
or modified upon written confirmation from the related Rating Agencies that such
reduction or modification will not adversely affect the then current ratings of
the Senior Certificates by the related Rating Agencies (determined without
regard to the Policy). Such reduction may adversely affect the coverage provided
by subordination with respect to Bankruptcy Losses. Any Fraud Loss will on each
Distribution Date be allocated solely to the Subordinate Certificates until the
Fraud Coverage Termination Date. Any Special Hazard Loss will on each
Distribution Date be allocated solely to the outstanding Subordinate
Certificates until the Special Hazard Termination Date.

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

                                      -82-

<PAGE>

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

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

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

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

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

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

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

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

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

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

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

                                      -83-

<PAGE>

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

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

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

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

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

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

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

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

                  (xviii) the Average Loss Severity Percentage;

                  (xix) the amount of Special Hazard Losses, Fraud Losses,
Bankruptcy Losses and Extraordinary Losses on such Distribution Date and in the
aggregate for all prior Distribution Dates; and

                                      -84-

<PAGE>

                  (xx) the then applicable Subgroup Senior Percentage, Subgroup
Senior Prepayment Percentage, Subordinate Percentage and Subordinate Prepayment
Percentage for each Subgroup.

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

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

         To the extent timely received from the Securities Administrator, the
Trustee will also make monthly statements available each month to
Certificateholders and MBIA via the Trustee's internet website. The Trustee's
internet website will initially be located at
"https://trustinvestorreporting.usbank.com". Assistance in using the Trustee's
website service can be obtained by calling the Trustee's customer service desk
at (800) 934-6802.

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

         Section 6.05 MONTHLY ADVANCES. If the Scheduled Payment on a Mortgage
Loan that was due on a related Due Date is delinquent other than as a result of
application of the Relief Act and for which the related Servicer was required to
make an advance pursuant to the related Servicing Agreement exceeds the amount
deposited in the Master Servicer Collection Account which will be used for an
advance with respect to such Mortgage Loan, the Master Servicer will deposit in
the Master Servicer Collection Account not later than the Distribution Account
Deposit Date immediately preceding the related Distribution Date an amount equal
to such deficiency, net of the Servicing Fee for such Mortgage Loan except to
the extent the Master Servicer determines any such advance to be a
Nonrecoverable Advance. Subject to the foregoing, the Master Servicer shall
continue to make such advances through the date that the related Servicer is
required to do so under its Servicing Agreement. If the Master Servicer deems an
advance to be a Nonrecoverable Advance,

                                      -85-

<PAGE>

on the Distribution Account Deposit Date, the Master Servicer shall present an
Officer's Certificate to the Trustee and MBIA (i) stating that the Master
Servicer elects not to make a Monthly Advance in a stated amount and (ii)
detailing the reason it deems the advance to be a Nonrecoverable Advance.

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

         Section 6.07 POLICY MATTERS.

                  (a) If, on the third Business Day before any Distribution
Date, the Securities Administrator notifies the Trustee that a Deficiency Amount
exists on such Distribution Date, the Trustee shall give notice to MBIA and the
Fiscal Agent (as defined in the Policy), if any, by telephone or telecopy of the
amount of such Deficiency Amount, confirmed in writing by notice substantially
in the form of Exhibit A to the Policy by 12:00 noon, New York City time on such
third Business Day. The Trustee's responsibility for delivering the notice to
MBIA as provided in the preceding sentence is contingent upon its receipt of
available, timely and accurate information from the Master Servicer.

                  (b) In the event the Trustee receives a certified copy of an
order of the appropriate court regarding any Preference Amount (as defined in
the Policy), the Trustee shall (i) promptly notify MBIA and the Fiscal Agent, if
any, and (ii) comply with the provisions of the Policy to obtain payment by MBIA
of such Preference Amount. In addition, the Trustee shall mail notice to all
Holders of the Class A-6 Certificates so affected that, in the event that any
such Holder's scheduled payment is a Preference Amount, such Holder will be
entitled to payment pursuant to the terms of the Policy, a copy of which shall
be made available to such Holders by the Trustee. The Trustee shall furnish to
MBIA and the Fiscal Agent, if any, its records listing the payments on the
affected Class A-6 Certificates, if any, that have been made by the Trustee and
subsequently recovered from the affected Holders, and the dates on which such
payments were made by the Trustee.

                  (c) At the time of the execution hereof, and for the purposes
hereof, the Trustee shall establish a separate special purpose trust account in
the name of the Trustee for the benefit of Holders of the Class A-6 Certificates
(the "Class A-6 Policy Payments Account") over which the Trustee shall have
exclusive control and sole right of withdrawal. The Class A-6 Policy Payments
Account shall be an Eligible Account. The Trustee shall deposit any amount paid
under the Policy into the Class A-6 Policy Payments Account and distribute such
amount only for the purposes of making the payments to Holders of the Class A-6
Certificates in respect of the Insured Payment for which the related claim was
made under the Policy. Such amounts shall be allocated by the Trustee to Holders
of Class A-6 Certificates affected by such shortfalls in the same manner as
interest and principal payments are to be allocated with respect to such
Certificates pursuant to Section 6.01. It

                                      -86-

<PAGE>

shall not be necessary for such payments to be made by checks or wire transfers
separate from the checks or wire transfers used to make regular payments
hereunder with funds withdrawn from the Distribution Account. However, any
payments made on the Class A-6 Certificates from funds in the Policy Payments
Account shall be noted as provided in subsection (e) below. Funds held in the
Class A-6 Policy Payments Account shall not be invested by the Trustee.

                  (d) Any funds received from MBIA for deposit into the Class
A-6 Policy Payments Account pursuant to the Policy in respect of a Distribution
Date or otherwise as a result of any claim under the Policy shall be applied by
the Trustee directly to the payment in full (i) of the Deficiency Amount due on
such Distribution Date on the Class A-6 Certificates, or (ii) of other amounts
payable under the Policy. Funds received by the Trustee as a result of any claim
under the Policy shall be used solely for payment to the Holders of the Class
A-6 Certificates and may not be applied for any other purpose, including,
without limitation, satisfaction of any costs, expenses or liabilities of the
Trustee, the Depositor, the Seller, any Servicer, the Securities Administrator,
the Master Servicer or the Trust Fund. Any funds remaining in the Class A-6
Policy Payments Account on the first Business Day after each Distribution Date
shall be remitted promptly to MBIA pursuant to the written instruction of MBIA.

                  (e) The Trustee shall keep complete and accurate records in
respect of (i) all funds remitted to it by MBIA and deposited into the Class A-6
Policy Payments Account and (ii) the allocation of such funds to (A) payments of
interest on and principal in respect of any Class A-6 Certificates and (B) the
amount of funds available to make distributions on the Class A-6 Certificates
pursuant to Section 6.01. MBIA shall have the right to inspect such records at
reasonable times during normal business hours upon three Business Days' prior
notice to the Trustee.

                  (f) The Trustee acknowledges, and each Holder of a Class A-6
Certificate by its acceptance of the Class A-6 Certificate agrees, that, without
the need for any further action on the part of MBIA or the Trustee to the extent
MBIA makes payments, directly or indirectly, on account of principal of or
interest on any Class A-6 Certificates, MBIA will be fully subrogated to the
rights of the Holders of such Class A-6 Certificates to receive such principal
and interest from the Trust Fund. The Holders of the Class A-6 Certificates, by
acceptance of the Class A-6 Certificates, assign their rights as Holders of the
Class A-6 Certificates to the extent of MBIA's interest with respect to amounts
paid under the Policy. Anything herein to the contrary notwithstanding, solely
for purposes of determining MBIA's rights, as applicable, as subrogee for
payments distributable pursuant to Section 6.01, any payment with respect to
distributions to the Class A-6 Certificates which is made with funds received
pursuant to the terms of the Policy, shall not be considered payment of the
Class A-6 Certificates from the Trust Fund and shall not result in the
distribution or the provision for the distribution in reduction of the Current
Principal Amount of the Class A-6 Certificates as described in this Article VI.

         The Trustee, the Seller, the Depositor and the Master Servicer shall
cooperate in all respects with any reasonable request by MBIA for action to
preserve or enforce MBIA's rights or interests under this Agreement without
limiting the rights or affecting the interests of the Holders as otherwise set
forth herein.

                                      -87-

<PAGE>

                  (g) Upon a Responsible Officer of the Trustee becoming aware
of the occurrence of an Event of Default, the Trustee shall promptly notify MBIA
of such Event of Default.

                  (h) The Trustee shall promptly notify MBIA of either of the
following as to which a Responsible Officer has actual knowledge: (A) the
commencement of any proceeding by or against the Seller commenced under the
United States bankruptcy code or any other applicable bankruptcy, insolvency,
receivership, rehabilitation or similar law (an "Insolvency Proceeding") and (B)
the making of any claim in connection with any proceeding seeking the avoidance
as a preferential transfer (a "Preference Claim") of any distribution made with
respect to the Class A-6 Certificates as to which it has actual knowledge. Each
Holder of a Class A-6 Certificate, by its purchase of Class A-6 Certificates,
and the Trustee hereby agrees that MBIA (so long as no MBIA Default exists) may
at any time during the continuation of any proceeding relating to a Preference
Claim direct all matters relating to such Preference Claim, including, without
limitation, (i) the direction of any appeal of any order relating to any
Preference Claim and (ii) the posting of any surety, supersedeas or performance
bond pending any such appeal. In addition and without limitation of the
foregoing, MBIA shall be subrogated to the rights of the Trustee and each Holder
of a Class A-6 Certificate in the conduct of any Preference Claim, including,
without limitation, all rights of any party to an adversary proceeding action
with respect to any court order issued in connection with any such Preference
Claim.

                  (i) The Master Servicer shall designate an MBIA Contact Person
who shall be available to MBIA to provide reasonable access to information
regarding the Mortgage Loans. The initial MBIA Contact Person is to the
attention of Secondary Marketing.

                  (j) The Trustee shall promptly surrender the Policy to MBIA
for cancellation upon the reduction of the Current Principal Amount of the Class
A-6 Certificates to zero.

                  (k) The Trustee shall send to MBIA any statements or
communications sent by the Trustee to Holders of the Class A-6 Certificates, in
each case at the same time such reports, statements and communications are
otherwise sent.

                  (l) For so long as there is not a continuing default by MBIA
under its obligations under the Policy (an "MBIA Default"), each Holder of a
Class A-6 Certificate agrees that MBIA shall be treated by the Seller, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee as
if MBIA were the Holder of all Class A-6 Certificates for the purpose (and
solely for the purpose) of the giving of any consent, the making of any
direction or the exercise of any voting or other control rights otherwise given
the Holders of the Class A-6 Certificates hereunder without any further consent
of the Holders of the Class A-6 Certificates and such holders shall not exercise
such rights without the prior written consent of MBIA.

         With respect to this Section 6.07, (i) the terms "Receipt" and
"Received" shall mean actual delivery to MBIA and MBIA's Fiscal Agent, if any,
received prior to 12:00 noon, New York City time, on a Business Day; delivery
either on a day that is not a Business Day or after 12:00 noon, New York City
time, shall be deemed to be Received on the next succeeding Business Day. If any
notice or certificate given under the Policy by the Trustee is not in proper
form or is not properly completed, executed or delivered, it shall be deemed not
to have been Received. MBIA or its Fiscal

                                      -88-

<PAGE>

Agent, if any, shall promptly so advise the Trustee and the Trustee may submit
an amended notice and (ii) "Business Day" means any day other than (A) a
Saturday or Sunday, (B) a day on which MBIA is closed or (C) a day on which
banking institutions in the City of New York, New York, or in which the
Corporate Trust Office of the Trustee is located, are authorized or obligated by
law or executive order to be closed.

                  (m) Unless otherwise designated in writing by the President or
a Managing Director of MBIA to the Trustee, the MBIA Premium Amount to be paid
pursuant to clause first of Section 6.01(a)(A) shall be paid by the Trustee to
MBIA by wire transfer with the following details specifically stated in the wire
transfer:

         Account Name:              MBIA Insurance Corporation
         Account Number:            910-2-721728
         Bank:                      JPMorgan Chase Bank
                                    4 Chase Metro Tech Center
                                    Brooklyn, NY 11245
         ABA Number:                021-000-021
         Policy No.:                43092

         Section 6.08 RESERVE FUND. The Reserve Fund will be maintained by the
Trustee in a separate account. The Reserve Fund will be beneficially owned by
Bear, Stearns & Co. Inc. and will not be an asset of the REMICs. The Trustee
shall make a withdrawal on each Distribution Date from amounts on deposit in the
Reserve Fund, to the extent funds are available therein, to cover any Prepayment
Interest Shortfalls allocated to the Class A-6 Certificates that were not offset
by Compensating Interest Payments and any Interest Shortfalls relating to the
application of the Relief Act allocated to the Insured Certificates. The Trustee
shall distribute such amounts withdrawn from the Reserve Fund to the Class A-6
Certificateholders on such Distribution Date in the same manner as interest
payments are to be allocated with respect to the Class A-6 Certificates pursuant
to Section 6.01. The balance of any amount remaining in the Reserve Fund on the
Distribution Date on which the Current Principal Amount of the Class A-6
Certificates has been reduced to zero will be distributed to Bear, Stearns & Co.
Inc.

         Section 6.09 ROUNDING ACCOUNT.

         (a) No later than the Closing Date, the Trustee will establish and
maintain with itself a segregated trust account that is an Eligible Account,
which shall be titled "Rounding Account, U.S. Bank National Association, as
trustee for the registered holders of Prime Mortgage Trust 2003-3, Mortgage
Pass-Through Certificates, Series 2003-3, Class A-6." On the Closing Date, Bear,
Stearns & Co. Inc. shall deposit with the Trustee, and the Trustee shall deposit
into the Rounding Account, cash in an amount equal to $999.99.

         (b) The Trustee on each Distribution Date shall, based upon information
provided to it by the Master Servicer for the related Distribution Date,
withdraw funds from the Rounding Account to pay the Rounding Amount to the
Certificate Owners of the Insured Certificates pursuant to Section 6.01(g). In
addition, the Trustee on each Distribution Date shall, based upon information
provided to it by the Master Servicer for the related Distribution Date,
withdraw funds from the

                                      -89-

<PAGE>

Distribution Account to repay to the Rounding Account the Rounding Amount from
the prior Distribution Date as contemplated in Section 6.01(g).

         Section 6.10 PRINCIPAL DISTRIBUTIONS ON THE INSURED CERTIFICATES.
Distributions in reduction of the Current Principal Amount of the Insured
Certificates will be made in integral multiples of $1,000 at the request of the
appropriate representatives of Deceased Holders of such Insured Certificates and
at the request of Living Owners of such Insured Certificates or by mandatory
distributions by Random Lot, pursuant to clauses (a) and (d) below, or on a pro
rata basis pursuant to clause (e) below.

         (a) On each Distribution Date on which distributions in reduction of
the Current Principal Amount of the Insured Certificates are made , such
distributions will be made in the following priority among the Certificate
Owners of the Insured Certificates:

                  (i) any request by the personal representatives of a Deceased
Holder or by a surviving tenant by the entirety, by a surviving joint tenant or
by a surviving tenant in common, but not exceeding an aggregate amount of
$100,000 per request; and

                  (ii) any request by a Living Owner, but not exceeding an
aggregate amount of $10,000 per request.

         Thereafter, distributions will be made, with respect to the Insured
Certificates, as provided in clauses (i) and (ii) above up to a second $100,000
and $10,000, respectively. This sequence of priorities will be repeated for each
request for principal distributions made by the Certificate Owners of the
Insured Certificates until all such requests have been honored.

         Requests for distributions in reduction of the Current Principal Amount
of the Insured Certificates presented on behalf of Deceased Holders in
accordance with the provisions of clause (i) above will be accepted in order of
their receipt by the Depository. Requests for distributions in reduction of the
Current Principal Amount of the Insured Certificate presented in accordance with
the provisions of clause (ii) above will be accepted in the order of their
receipt by the Depository after all requests presented in accordance with clause
(i) above have been honored. All requests for distributions in reduction of the
Current Principal Amount of the Insured Certificates will be accepted in
accordance with the provisions set forth in Section 6.10(c). All requests for
distributions in reduction of the Current Principal Amount of the Insured
Certificates with respect to any Distribution Date must be received by the
Depository and on the Depository's "participant terminal system" and received by
the Trustee no later than the close of business on the related Record Date.
Requests for distributions that are on the Depository's participant terminal
system and received by the Trustee after the related Record Date and requests,
in either case, for distributions not accepted with respect to any Distribution
Date, will be treated as requests for distributions in reduction of the Current
Principal Amount of Insured Certificates on the next succeeding Distribution
Date, and each succeeding Distribution Date thereafter, until such request is
accepted or is withdrawn as provided in Section 6.10(c). Such requests as are
not so withdrawn shall retain their order of priority without the need for any
further action on the part of the appropriate Certificate Owner of the related
Insured Certificate, all in accordance with the procedures of the Depository and
the Trustee. Upon the transfer of the beneficial ownership of the Insured
Certificate, any distribution request previously

                                      -90-

<PAGE>

submitted with respect to such Certificate will be deemed to have been withdrawn
only upon the receipt by the Trustee on or before the Record Date for such
Distribution Date of notification of such withdrawal in the manner set forth in
Section 6.10(c) on the Depository's participant terminal system.

         Distributions in reduction of the Current Principal Amount of the
Insured Certificates will be applied in an amount equal to the Subgroup
Principal Distribution Amount allocable to such Class pursuant to Section
6.01(h), plus, with respect to the Insured Certificates, any amounts available
for distribution from the Rounding Account established as provided in Section
6.09, provided that the aggregate distribution in reduction of the Current
Principal Amount of the Insured Certificates on any Distribution Date shall be
made in an integral multiple of $1,000.

         To the extent that the portion of the Subgroup Principal Distribution
Amount allocable to distributions in reduction of the Current Principal Amount
of the Insured Certificates on any Distribution Date exceeds the aggregate
Current Principal Amount of the Insured Certificates with respect to which
distribution requests, as set forth above, have been received (plus any amounts
required to be distributed pursuant to the Rounding Account with respect to the
Insured Certificates), distributions in reduction of the Current Principal
Amount of the Insured Certificates will be made by mandatory distribution
pursuant to Section 6.10(d).

         (b) An Insured Certificate shall be deemed to be held by a Deceased
Holder for purposes of this Section 6.10 if the death of the Certificate Owner
thereof is deemed to have occurred. Insured Certificates beneficially owned by
tenants by the entirety, joint tenants or tenants in common will be considered
to be beneficially owned by a single owner. The death of a tenant by the
entirety, joint tenant or tenant in common will be deemed to be the death of the
Certificate Owner, and the Insured Certificates so beneficially owned will be
eligible for priority with respect to distributions in reduction of the Current
Principal Amount thereof, subject to the limitations stated above. Insured
Certificates beneficially owned by a trust will be considered to be beneficially
owned by each beneficiary of the trust to the extent of such beneficiary's
beneficial interest therein, but in no event will a trust's beneficiaries
collectively be deemed to be Certificate Owners of a number of Individual
Insured Certificates of which such trust is the owner. The death of a
beneficiary of a trust will be deemed to be the death of a Certificate Owner of
the Insured Certificates, as applicable, owned by the trust to the extent of
such beneficiary's beneficial interest in such trust. The death of an individual
who was a tenant by the entirety, joint tenant or tenant in common in a tenancy
which is the beneficiary of a trust will be deemed to be the death of the
beneficiary of such trust. The death of a person who, during his or her
lifetime, was entitled to substantially all of the beneficial ownership
interests in Individual Insured Certificates will be deemed to be the death of
the Certificate Owner of the Insured Certificates regardless of the registration
of ownership, if such beneficial interest can be established to the satisfaction
of the Depository Participant. Such beneficial interest will be deemed to exist
in typical cases of street name or nominee ownership, ownership by a trustee,
ownership under the Uniform Gifts to Minors Act and community property or other
joint ownership arrangements between a husband and wife. Certificate beneficial
interests shall include the power to sell, transfer or otherwise dispose of an
Insured Certificate and the right to receive the proceeds therefrom, as well as
interest and distributions in reduction of the Current Principal Amount of the
Insured Certificates, as applicable, payable with respect thereto. The Trustee
shall not be under any duty to determine independently the occurrence of the
death of any deceased Certificate

                                      -91-

<PAGE>

Owner. The Trustee may rely entirely upon documentation delivered to it pursuant
to Section 6.10(c) in establishing the eligibility of any Certificate Owner to
receive the priority accorded Deceased Holders in Section 6.10(a).

         (c) Requests for distributions in reduction of the Current Principal
Amount of Insured Certificates must be made by delivering a written request
therefor to the Depository Participant or Indirect Depository Participant that
maintains the account evidencing such Certificate Owner's interest in Insured
Certificates. In the case of a request on behalf of a Deceased Holder,
appropriate evidence of death and any tax waivers are required to be forwarded
to the Depository Participant under separate cover. The Depository Participant
shall forward a certification, satisfactory to the Trustee, certifying the death
of the Deceased Holder and the receipt of the appropriate death and tax waivers.
The Depository Participant should in turn make the request of the Depository
(or, in the case of an Indirect Depository Participant, such Indirect Depository
Participant must notify the related Depository Participant of such request,
which Depository Participant should make the request of the Depository) on the
Depository's participant terminal system. The Depository may establish such
procedures as it deems fair and equitable to establish the order of receipt of
requests for such distributions received by it on the same day. None of the
Depositor, the Seller, the Master Servicer, MBIA or the Trustee shall be liable
for any delay in delivery of requests for distributions or withdrawals of such
requests by the Depository, a Depository Participant or any Indirect Depository
Participant.

         The Depository shall maintain a list of those Depository Participants
representing the appropriate Certificate Owners of Insured Certificates that
have submitted requests for distributions in reduction of the Current Principal
Amount of Insured Certificates, together with the order of receipt and the
amounts of such requests on the Depository's participant terminal system. The
Depository will honor requests for distributions in the order of their receipt
(subject to the priorities described in Section 6.10(a) above). The Trustee
shall notify the Depository as to which requests should be honored on each
Distribution Date at least two Business Days prior to such Distribution Date
based on the report received by the Trustee pursuant to Section 4.05(c) and
shall notify the Depository as to the amount of the Subgroup Principal
Distribution Amount to be distributed to the Insured Certificates by Random Lot
pursuant to Section 6.10(d). Requests shall be honored by the Depository in
accordance with the procedures, and subject to the priorities and limitations,
described in this Section 6.10. The exact procedures to be followed by the
Trustee and the Depository for purposes of determining such priorities and
limitations will be those established from time to time by the Trustee or the
Depository, as the case may be. The decisions of the Trustee and the Depository
concerning such matters will be final and binding on all affected persons.

         Individual Insured Certificates that have been accepted for a
distribution shall be due and payable on the applicable Distribution Date. Such
Certificates shall cease to bear interest after the last day of the month
preceding the month in which such Distribution Date occurs.

         Any Certificate Owner of an Insured Certificate that has requested a
distribution may withdraw its request by so notifying in writing the Depository
Participant or Indirect Depository Participant that maintains such Certificate
Owner's account. In the event that such account is maintained by an Indirect
Depository Participant, such Indirect Depository Participant must notify the
related Depository Participant which in turn must forward the withdrawal of such
request on the

                                      -92-

<PAGE>

Depository's participant terminal system. If such withdrawal of a request for
distribution has not been received on the Depository's participant terminal
system on or before the Record Date for the next Distribution Date, the
previously made request for distribution will be irrevocable with respect to the
making of distributions in reduction of the Current Principal Amount of the
Insured Certificates on such Distribution Date.

         In the event any requests for distributions in reduction of the Current
Principal Amount of the Insured Certificates are rejected by the Trustee for
failure to comply with the requirements of this Section 6.10, the Trustee shall
return such request to the appropriate Depository Participant with a copy to the
Depository with an explanation as to the reason for such rejection.

         (d) To the extent, if any, that distributions in reduction of the
Current Principal Amount of the Insured Certificates on a Distribution Date
exceed the outstanding Current Principal Amount of the Insured Certificates with
respect to which distribution requests have been received by the related Record
Date, as provided in Section 6.10(a) above, the additional distributions in
reduction of the Current Principal Amount of the Insured Certificates will be
made by mandatory distributions in reduction thereof. Such mandatory
distributions on Individual Insured Certificates will be made by Random Lot in
accordance with the then-applicable Random Lot procedures of the Depository, the
Depository Participants and the Indirect Depository Participants representing
the Certificate Owners. The Trustee shall notify the Depository of the aggregate
amount of the mandatory distribution in reduction of the Current Principal
Amount of the Insured Certificates to be made on any such Distribution Date. The
Depository shall then allocate such aggregate amount among its Depository
Participants on a Random Lot basis. Each Depository Participant and, in turn,
each Indirect Depository Participant will then select, in accordance with its
own procedures, Individual Insured Certificates from among those held in its
accounts to receive mandatory distributions in reduction of the Current
Principal Amount of the Insured Certificates, such that the total amount so
selected is equal to the aggregate amount of such mandatory distributions
allocated to such Depository Participant by the Depository and to such Indirect
Depository Participant by its related Depository Participant, as the case may
be. Depository Participants and Indirect Depository Participants that hold
Insured Certificates selected for mandatory distributions in reduction of the
Current Principal Amount thereof are required to provide notice of such
mandatory distributions to the affected Certificate Owners. The Master Servicer
agrees to notify the Trustee of the amount of distributions in reduction of the
Current Principal Amount of the Insured Certificates to be made on each
Distribution Date in a timely manner such that the Trustee may fulfill its
obligations pursuant to the letter of representations dated the Closing Date
among the Company, the Trustee and the Depository.

         (e) Notwithstanding any provisions herein to the contrary, on any
Distribution Date on which (i) any Realized Losses are allocated to the Insured
Certificates and (ii) a MBIA Default has occurred and/or is continuing,
distributions in reduction of the Current Principal Amount of the Insured
Certificates will be made pro rata on the basis of their respective percentage
interests with the respect to the Insured Certificates among the Certificate
Owners of the Insured Certificates and will not be made in integral multiples of
$1,000 nor pursuant to requests for distribution as permitted by this Section
6.10 or mandatory distributions by Random Lot.

                                      -93-

<PAGE>

         (f) In the event that Definitive Certificates representing the Insured
Certificates are issued pursuant to Section 5.01, an amendment to this
Agreement, which may be approved without the consent of any Certificateholders,
shall establish procedures relating to the manner in which distributions in
reduction of the Current Principal Amount of such Insured Certificates are to be
made; provided that such procedures shall be consistent, to the extent
practicable and customary for certificates similar to the Insured Certificates,
with the provisions of this Section 6.10.

                                      -94-

<PAGE>

                                   ARTICLE VII
                               The Master Servicer

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

         Section 7.02 MERGER OR CONSOLIDATION OF THE MASTER SERVICER.

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

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

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

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

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

                                      -95-

<PAGE>

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

         (b) The Master Servicer and any director, officer, employee or agent of
the Master Servicer may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder.

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

         (d) The Master Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its duties under
this Agreement and that in its opinion may involve it in any expense or
liability; provided, however, the Master Servicer may in its discretion, with
the consent of the Trustee (which consent shall not be unreasonably withheld),
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto and the
interests of the Certificateholders hereunder. In such event, the legal expenses
and costs of such action and any liability resulting therefrom shall be
expenses, costs and liabilities of the Trust Fund, and the Master Servicer shall
be entitled to be reimbursed therefor out of the Master Servicer Collection
Account as provided by Section 4.03. Nothing in this Subsection 7.04(d) shall
affect the Master Servicer's obligation to supervise, or to take such actions as
are necessary to ensure, the servicing and administration of the Mortgage Loans
pursuant to Subsection 3.01(a).

         (e) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be required to investigate or make recommendations
concerning potential liabilities which the Trust might incur

                                      -96-

<PAGE>

as a result of such course of action by reason of the condition of the Mortgaged
Properties but shall give notice to the Trustee if it has notice of such
potential liabilities.

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

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

         Section 7.06 SUCCESSOR MASTER SERVICER. In connection with the
appointment of any successor master servicer or the assumption of the duties of
the Master Servicer, the Company or the Trustee may make such arrangements for
the compensation of such successor master servicer out of payments on the
Mortgage Loans as the Company or the Trustee and such successor master servicer
shall agree. If the successor master servicer does not agree that such market
value is a fair price, such successor master servicer shall obtain two
quotations of market value from third parties actively engaged in the servicing
of single-family mortgage loans. Notwithstanding the foregoing, the compensation
payable to a successor master servicer may not exceed the compensation which the
Master Servicer would have been entitled to retain if the Master Servicer had
continued to act as Master Servicer hereunder.

         Section 7.07 SALE AND ASSIGNMENT OF MASTER SERVICING. The Master
Servicer may sell and assign its rights and delegate its duties and obligations
in its entirety as Master Servicer under this Agreement and the Company may
terminate the Master Servicer without cause and select a new Master Servicer;
provided, however, that: (i) the purchaser or transferee accepting such
assignment and delegation (a) shall be a Person which shall be qualified to
service mortgage loans for Fannie Mae or Freddie Mac; (b) shall have a net worth
of not less than $10,000,000 (unless otherwise approved by each Rating Agency
pursuant to clause (ii) below); (c) shall be reasonably satisfactory to the
Trustee (as evidenced in a writing signed by the Trustee); and (d) shall execute
and deliver to the Trustee an agreement, in form and substance reasonably
satisfactory to the Trustee, which contains an assumption by such Person of the
due and punctual performance and observance of each covenant and condition to be
performed or observed by it as master servicer under this Agreement, any
custodial agreement from and after the effective date of such agreement; (ii)
each Rating Agency and MBIA shall be given prior written notice of the identity
of the proposed successor to the Master Servicer and each Rating Agency's rating
of the Certificates (determined without regard to the Policy) in effect
immediately prior to such assignment, sale and delegation will not be
downgraded, qualified or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect delivered to the Master
Servicer and the Trustee; (iii) the Master Servicer assigning and selling the
master servicing shall deliver to the Trustee and MBIA an Officer's Certificate
and

                                      -97-

<PAGE>

an Opinion of Independent Counsel addressed to the Trustee and MBIA, each
stating that all conditions precedent to such action under this Agreement have
been completed and such action is permitted by and complies with the terms of
this Agreement; and (iv) in the event the Master Servicer is terminated without
cause by the Company, the Company shall pay the terminated Master Servicer a
termination fee equal to 0.25% of the aggregate Scheduled Principal Balance of
the Mortgage Loans at the time the master servicing of the Mortgage Loans is
transferred to the successor Master Servicer. No such assignment or delegation
shall affect any liability of the Master Servicer arising prior to the effective
date thereof.

                                      -98-

<PAGE>

                                  ARTICLE VIII
                                     Default

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

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

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

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

                  (iv) The Master Servicer consents to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or relating to
the Master Servicer or substantially all of its property; or the Master Servicer
admits in writing its inability to pay its debts generally as they become due,
files a petition to take advantage of any applicable insolvency or
reorganization statute, makes an assignment for the benefit of its creditors, or
voluntarily suspends payment of its obligations;

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

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

                                      -99-

<PAGE>

In each and every such case, so long as such Event of Default with respect to
the Master Servicer shall not have been remedied, either the Trustee or the
Holders of Certificates evidencing Fractional Undivided Interests aggregating
not less than 51% of the principal of the Trust Fund, by notice in writing to
the Master Servicer (and to the Trustee if given by such Certificateholders),
with a copy to the Rating Agencies and MBIA, and with the consent of the
Company, may terminate all of the rights and obligations (but not the
liabilities) of the Master Servicer under this Agreement and in and to the
Mortgage Loans and/or the REO Property serviced by the Master Servicer and the
proceeds thereof. Upon the receipt by the Master Servicer of the written notice,
all authority and power of the Master Servicer under this Agreement, whether
with respect to the Certificates, the Mortgage Loans, REO Property or under any
other related agreements (but only to the extent that such other agreements
relate to the Mortgage Loans or related REO Property) shall, subject to Section
8.02, automatically and without further action pass to and be vested in the
Trustee pursuant to this Section 8.01; and, without limitation, the Trustee is
hereby authorized and empowered to execute and deliver, on behalf of the Master
Servicer as attorney-in-fact or otherwise, any and all documents and other
instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents, or otherwise. The Master Servicer agrees to cooperate with
the Trustee in effecting the termination of the Master Servicer's rights and
obligations hereunder, including, without limitation, the transfer to the
Trustee of (i) the property and amounts which are then or should be part of the
Trust or which thereafter become part of the Trust; and (ii) originals or copies
of all documents of the Master Servicer reasonably requested by the Trustee to
enable it to assume the Master Servicer's duties thereunder. In addition to any
other amounts which are then, or, notwithstanding the termination of its
activities under this Agreement, may become payable to the Master Servicer under
this Agreement, the Master Servicer shall be entitled to receive, out of any
amount received on account of a Mortgage Loan or related REO Property, that
portion of such payments which it would have received as reimbursement under
this Agreement if notice of termination had not been given. The termination of
the rights and obligations of the Master Servicer shall not affect any
obligations incurred by the Master Servicer prior to such termination.

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

         Section 8.02 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR. (a) Upon the
receipt by the Master Servicer of a notice of termination pursuant to Section
8.01 or an Opinion of Independent Counsel pursuant to Section 7.05 to the effect
that the Master Servicer is legally unable to act or to delegate its duties to a
Person which is legally able to act, the Trustee shall automatically become the
successor in all respects to the Master Servicer in its capacity under this
Agreement and the

                                      -100-

<PAGE>

transactions set forth or provided for herein and shall thereafter be subject to
all the responsibilities, duties, liabilities and limitations on liabilities
relating thereto placed on the Master Servicer by the terms and provisions
hereof (including the requirement to make Monthly Advances pursuant to Section
6.05); provided, however, that the Company shall have the right to either (a)
immediately assume the duties of the Master Servicer or (b) select a successor
Master Servicer; provided further, however, that the Trustee shall have no
obligation whatsoever with respect to any liability (other than advances deemed
recoverable and not previously made) incurred by the Master Servicer at or prior
to the time of termination. As compensation therefor, but subject to Section
7.06, the Trustee shall be entitled to compensation which the Master Servicer
would have been entitled to retain if the Master Servicer had continued to act
hereunder, except for those amounts due the Master Servicer as reimbursement
permitted under this Agreement for advances previously made or expenses
previously incurred. Notwithstanding the above, the Trustee may, if it shall be
unwilling so to act, or shall, if it is legally unable so to act, appoint or
petition a court of competent jurisdiction to appoint, any established housing
and home finance institution which is a Fannie Mae- or Freddie Mac-approved
servicer, and with respect to a successor to the Master Servicer only, having a
net worth of not less than $10,000,000, as the successor to the Master Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Master Servicer hereunder; provided, that the Trustee
shall obtain a letter from each Rating Agency that the ratings, if any, on each
of the Certificates (determined without regard to the Policy) will not be
lowered as a result of the selection of the successor to the Master Servicer.
Pending appointment of a successor to the Master Servicer hereunder, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on the Mortgage Loans as it and
such successor shall agree; provided, however, that the provisions of Section
7.06 shall apply, the compensation shall not be in excess of that which the
Master Servicer would have been entitled to if the Master Servicer had continued
to act hereunder, and that such successor shall undertake and assume the
obligations of the Trustee to pay compensation to any third Person acting as an
agent or independent contractor in the performance of master servicing
responsibilities hereunder. The Trustee and such successor shall take such
action, consistent with this Agreement, as shall be necessary to effectuate any
such succession.

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

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

         Section 8.04 WAIVER OF DEFAULTS. The Trustee shall transmit by mail to
all Certificateholders, within 60 days after the occurrence of any Event of
Default actually known to a Responsible Officer of the Trustee, unless such
Event of Default shall have been cured, notice of

                                      -101-

<PAGE>

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

         Section 8.05 LIST OF CERTIFICATEHOLDERS. Upon written request of three
or more Certificateholders of record, for purposes of communicating with other
Certificateholders with respect to their rights under this Agreement, the
Trustee will afford such Certificateholders access during business hours to the
most recent list of Certificateholders held by the Trustee.

                                      -102-

<PAGE>

                                   ARTICLE IX
             Concerning the Trustee and the Securities Administrator

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

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

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

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

                  (i) Prior to the occurrence of an Event of Default, and after
the curing or waiver of all such Events of Default which may have occurred, the
duties and obligations of the Trustee and the Securities Administrator shall be
determined solely by the express provisions of this Agreement, neither the
Trustee nor the Securities Administrator shall be liable except for the
performance of their respective duties and obligations as are specifically set
forth in this Agreement, no implied covenants or obligations shall be read into
this Agreement against the Trustee or the Securities Administrator and, in the
absence of bad faith on the part of the Trustee or the Securities Administrator,
respectively, the Trustee or the Securities Administrator, respectively, may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished to the
Trustee or the Securities Administrator, respectively, and conforming to the
requirements of this Agreement;

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

                                      -103-

<PAGE>

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

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

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

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

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

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

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

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

                                      -104-

<PAGE>

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

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

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

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

                  (iii) Neither the Trustee nor the Securities Administrator
shall be under any obligation to exercise any of the trusts or powers vested in
it by this Agreement, other than its obligation to give notices pursuant to this
Agreement, or to institute, conduct or defend any litigation hereunder or in
relation hereto at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby. Nothing contained herein shall, however, relieve the Trustee
of the obligation, upon the occurrence of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge (which has not been
cured or waived), to exercise such of the rights and powers vested in it by this
Agreement, and to use the same degree of care and skill in their exercise, as a
prudent person would exercise under the circumstances in the conduct of his own
affairs;

                  (iv) Prior to the occurrence of an Event of Default hereunder
and after the curing or waiver of all Events of Default which may have occurred,
neither the Trustee nor the Securities Administrator shall be liable in its
individual capacity for any action taken, suffered or omitted by it in good
faith and believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Agreement;

                  (v) Neither the Trustee nor the Securities Administrator shall
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless
requested in writing to do so by Holders of Certificates evidencing Fractional
Undivided Interests aggregating not less than 25% of the Trust Fund and provided
that the payment within a reasonable time to the Trustee or the Securities
Administrator, as applicable, of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion of the
Trustee or the Securities Administrator, as applicable, reasonably assured to
the Trustee or the Securities Administrator, as applicable, by the security
afforded to it by the terms of this Agreement. The

                                      -105-

<PAGE>

Trustee or the Securities Administrator may require reasonable indemnity against
such expense or liability as a condition to taking any such action. The
reasonable expense of every such examination shall be paid by the
Certificateholders requesting the investigation;

                  (vi) The Trustee and the Securities Administrator may execute
any of the trusts or powers hereunder or perform any duties hereunder either
directly or through Affiliates, agents or attorneys; provided, however, that the
Trustee may not appoint any agent to perform its custodial functions with
respect to the Mortgage Files or paying agent functions under this Agreement
without the express written consent of the Master Servicer, which consent will
not be unreasonably withheld. Neither the Trustee nor the Securities
Administrator shall be liable or responsible for the misconduct or negligence of
any of the Trustee's or the Securities Administrator's agents or attorneys or a
custodian or paying agent appointed hereunder by the Trustee or the Securities
Administrator with due care and, when required, with the consent of the Master
Servicer;

                  (vii) Should the Trustee or the Securities Administrator deem
the nature of any action required on its part, other than a payment or transfer
under Subsection 4.01(b) or Section 4.02, to be unclear, the Trustee or the
Securities Administrator, respectively, may require prior to such action that it
be provided by the Depositor with reasonable further instructions;

                  (viii) The right of the Trustee or the Securities
Administrator to perform any discretionary act enumerated in this Agreement
shall not be construed as a duty, and neither the Trustee nor the Securities
Administrator shall be accountable for other than its negligence or willful
misconduct in the performance of any such act;

                  (ix) Neither the Trustee nor the Securities Administrator
shall be required to give any bond or surety with respect to the execution of
the trust created hereby or the powers granted hereunder, except as provided in
Subsection 9.07; and

                  (x) Neither the Trustee nor the Securities Administrator shall
have any duty to conduct any affirmative investigation as to the occurrence of
any condition requiring the repurchase of any Mortgage Loan by the Seller
pursuant to this Agreement or the Mortgage Loan Purchase Agreement, as
applicable, or the eligibility of any Mortgage Loan for purposes of this
Agreement.

         Section 9.03 TRUSTEE AND SECURITIES ADMINISTRATOR NOT LIABLE FOR
CERTIFICATES OR MORTGAGE LOANS. The recitals contained herein and in the
Certificates (other than the signature and countersignature of the Trustee on
the Certificates) shall be taken as the statements of the Depositor, and neither
the Trustee, or the Custodian on its behalf, nor the Securities Administrator
shall have any responsibility for their correctness. Neither the Trustee nor the
Securities Administrator makes any representation as to the validity or
sufficiency of the Certificates (other than the signature and countersignature
of the Trustee on the Certificates) or of any Mortgage Loan except as expressly
provided in Sections 2.02 and 2.05 hereof; provided, however, that the foregoing
shall not relieve the Trustee, or the Custodian on its behalf, of the obligation
to review the Mortgage Files pursuant to Sections 2.02 and 2.04. The Trustee's
signature and countersignature (or countersignature of its agent) on the
Certificates shall be solely in its capacity as Trustee and shall not constitute
the Certificates an obligation of the Trustee in any other capacity. Neither the
Trustee or the Securities Administrator shall be accountable for the use or
application by the Depositor of any of the

                                      -106-

<PAGE>

Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor with respect to the Mortgage
Loans. Neither the Trustee nor the Securities Administrator shall be responsible
for the legality or validity of this Agreement or any document or instrument
relating to this Agreement, the validity of the execution of this Agreement or
of any supplement hereto or instrument of further assurance, or the validity,
priority, perfection or sufficiency of the security for the Certificates issued
hereunder or intended to be issued hereunder. Neither the Trustee nor the
Securities Administrator shall at any time have any responsibility or liability
for or with respect to the legality, validity and enforceability of any Mortgage
or any Mortgage Loan, or the perfection and priority of any Mortgage or the
maintenance of any such perfection and priority, or for or with respect to the
sufficiency of the Trust Fund or its ability to generate the payments to be
distributed to Certificateholders, under this Agreement. Neither the Trustee nor
the Securities Administrator shall have any responsibility for filing any
financing statement or continuation statement in any public office at any time
or to otherwise perfect or maintain the perfection of any security interest or
lien granted to it hereunder or to record this Agreement.

         Section 9.04 TRUSTEE AND SECURITIES ADMINISTRATOR MAY OWN CERTIFICATES.
The Trustee and the Securities Administrator in its individual capacity or in
any capacity other than as Trustee hereunder may become the owner or pledgee of
any Certificates with the same rights it would have if it were not Trustee or
the Securities Administrator, as applicable, and may otherwise deal with the
parties hereto.

         Section 9.05 TRUSTEE'S AND SECURITIES ADMINISTRATOR'S FEES AND
EXPENSES. The fees and expenses of the Trustee and the Securities Administrator
shall be paid in accordance with a side letter agreement between the Trustee and
the Master Servicer. In addition, the Trustee and the Securities Administrator
will be entitled to recover from the Master Servicer Collection Account pursuant
to Section 4.03(b) all reasonable out-of-pocket expenses, disbursements and
advances and the expenses of the Trustee and the Securities Administrator,
respectively, in connection with any Event of Default, any breach of this
Agreement or any claim or legal action (including any pending or threatened
claim or legal action) incurred or made by the Trustee or the Securities
Administrator, respectively, in the administration of the trusts hereunder
(including the reasonable compensation, expenses and disbursements of its
counsel) except any such expense, disbursement or advance as may arise from its
negligence or intentional misconduct or which is the responsibility of the
Certificateholders. If funds in the Master Servicer Collection Account are
insufficient therefor, the Trustee and the Securities Administrator shall
recover such expenses from the Depositor and the Depositor hereby agrees to pay
such expenses, disbursements or advances upon demand. Such compensation and
reimbursement obligation shall not be limited by any provision of law in regard
to the compensation of a trustee of an express trust.

         Section 9.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE AND SECURITIES
ADMINISTRATOR. The Trustee and any successor Trustee and the Securities
Administrator and any successor Securities Administrator shall during the entire
duration of this Agreement be a state bank or trust company or a national
banking association organized and doing business under the laws of such state or
the United States of America, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus and undivided profits of at
least $40,000,000 or, in the case of a successor Trustee, $50,000,000, subject
to supervision or examination by federal or state authority

                                      -107-

<PAGE>

and, in the case of the Trustee, rated "BBB" or higher by S&P or Fitch Ratings
with respect to their long-term rating and rated "BBB" or higher by S&P or Fitch
Ratings and "Baa2" or higher by Moody's with respect to any outstanding
long-term unsecured unsubordinated debt, and, in the case of a successor Trustee
or successor Securities Administrator other than pursuant to Section 9.10, rated
in one of the two highest long-term debt categories of, or otherwise acceptable
to, each of the Rating Agencies. If the Trustee publishes reports of condition
at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section 9.06
the combined capital and surplus of such corporation shall be deemed to be its
total equity capital (combined capital and surplus) as set forth in its most
recent report of condition so published. In case at any time the Trustee or the
Securities Administrator shall cease to be eligible in accordance with the
provisions of this Section 9.06, the Trustee or the Securities Administrator
shall resign immediately in the manner and with the effect specified in Section
9.08.

         Section 9.07 INSURANCE. The Trustee and the Securities Administrator,
at their own expense, shall at all times maintain and keep in full force and
effect: (i) fidelity insurance, (ii) theft of documents insurance and (iii)
forgery insurance (which may be collectively satisfied by a "Financial
Institution Bond" and/or a "Bankers' Blanket Bond"). All such insurance shall be
in amounts, with standard coverage and subject to deductibles, as are customary
for insurance typically maintained by banks or their affiliates which act as
custodians for investor-owned mortgage pools. A certificate of an officer of the
Trustee or the Securities Administrator as to the Trustee's or the Securities
Administrator's, respectively, compliance with this Section 9.07 shall be
furnished to any Certificateholder upon reasonable written request.

         Section 9.08 RESIGNATION AND REMOVAL OF THE TRUSTEE AND SECURITIES
ADMINISTRATOR. (a) The Trustee and the Securities Administrator may at any time
resign and be discharged from the Trust hereby created by giving written notice
thereof to the Depositor and the Master Servicer, with a copy to the Rating
Agencies. Upon receiving such notice of resignation, the Depositor shall
promptly appoint a successor Trustee or successor Securities Administrator, as
applicable, by written instrument, in triplicate, one copy of which instrument
shall be delivered to each of the resigning Trustee or Securities Administrator,
as applicable, the successor Trustee or Securities Administrator, as applicable.
If no successor Trustee or Securities Administrator shall have been so appointed
and have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator may petition any
court of competent jurisdiction for the appointment of a successor Trustee or
Securities Administrator.

         (b) If at any time the Trustee or the Securities Administrator shall
cease to be eligible in accordance with the provisions of Section 9.06 and shall
fail to resign after written request therefor by the Depositor or if at any time
the Trustee or the Securities Administrator shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or the
Securities Administrator, as applicable, or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or the
Securities Administrator, as applicable, or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then the Depositor shall
promptly remove the Trustee, or shall be entitled to remove the Securities
Administrator, as applicable, and appoint a successor Trustee or Securities
Administrator, as applicable, by written instrument, in triplicate, one copy of
which instrument shall be delivered to each of the Trustee or

                                      -108-

<PAGE>

Securities Administrator, as applicable, so removed, the successor Trustee or
Securities Administrator, as applicable.

         (c) The Holders of Certificates evidencing Fractional Undivided
Interests aggregating not less than 51% of the Trust Fund may at any time remove
the Trustee or the Securities Administrator and appoint a successor Trustee or
Securities Administrator by written instrument or instruments, in quadruplicate,
signed by such Holders or their attorneys-in-fact duly authorized, one complete
set of which instruments shall be delivered to the Depositor, the Master
Servicer, the Securities Administrator (if the Trustee is removed), the Trustee
(if the Securities Administrator is removed), and the Trustee or Securities
Administrator so removed and the successor so appointed. In the event that the
Trustee or Securities Administrator is removed by the Holders of Certificates in
accordance with this Section 9.08(c), the Holders of such Certificates shall be
responsible for paying any compensation payable to a successor Trustee or
successor Securities Administrator, in excess of the amount paid to the
predecessor Trustee or predecessor Securities Administrator, as applicable.

         (d) No resignation or removal of the Trustee or the Securities
Administrator and appointment of a successor Trustee or Securities Administrator
pursuant to any of the provisions of this Section 9.08 shall become effective
except upon appointment of and acceptance of such appointment by the successor
Trustee or Securities Administrator as provided in Section 9.09.

         Section 9.09 SUCCESSOR TRUSTEE AND SUCCESSOR SECURITIES ADMINISTRATOR.
(a) Any successor Trustee or Securities Administrator appointed as provided in
Section 9.08 shall execute, acknowledge and deliver to the Depositor and to its
predecessor Trustee or Securities Administrator an instrument accepting such
appointment hereunder. The resignation or removal of the predecessor Trustee or
Securities Administrator shall then become effective and such successor Trustee
or Securities Administrator, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as Trustee or
Securities Administrator herein. The predecessor Trustee or Securities
Administrator shall after payment of its outstanding fees and expenses promptly
deliver to the successor Trustee or Securities Administrator, as applicable, all
assets and records of the Trust held by it hereunder, and the Depositor and the
predecessor Trustee or Securities Administrator, as applicable, shall execute
and deliver such instruments and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in the successor
Trustee or Securities Administrator, as applicable, all such rights, powers,
duties and obligations.

         (b) No successor Trustee or Securities Administrator shall accept
appointment as provided in this Section 9.09 unless at the time of such
acceptance such successor Trustee or Securities Administrator shall be eligible
under the provisions of Section 9.06.

         (c) Upon acceptance of appointment by a successor Trustee or Securities
Administrator as provided in this Section 9.09, the successor Trustee or
Securities Administrator shall mail notice of the succession of such Trustee or
Securities Administrator hereunder to all Certificateholders at their addresses
as shown in the Certificate Register and to the Rating Agencies and MBIA. The
Company shall pay the cost of any mailing by the successor Trustee or Securities
Administrator.

                                      -109-

<PAGE>

         Section 9.10 MERGER OR CONSOLIDATION OF TRUSTEE OR SECURITIES
ADMINISTRATOR. Any state bank or trust company or national banking association
into which the Trustee or the Securities Administrator may be merged or
converted or with which it may be consolidated or any state bank or trust
company or national banking association resulting from any merger, conversion or
consolidation to which the Trustee or the Securities Administrator,
respectively, shall be a party, or any state bank or trust company or national
banking association succeeding to all or substantially all of the corporate
trust business of the Trustee or the Securities Administrator, respectively,
shall be the successor of the Trustee or the Securities Administrator,
respectively, hereunder, provided such state bank or trust company or national
banking association shall be eligible under the provisions of Section 9.06. Such
succession shall be valid without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.

         Section 9.11 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. (a)
Notwithstanding any other provisions hereof, at any time, for the purpose of
meeting any legal requirements of any jurisdiction in which any part of the
Trust or property constituting the same may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee and the Depositor to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 9.11, such powers, duties, obligations, rights and trusts as the
Depositor and the Trustee may consider necessary or desirable.

         (b) If the Depositor shall not have joined in such appointment within
15 days after the receipt by it of a written request so to do, the Trustee shall
have the power to make such appointment without the Depositor.

         (c) No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor Trustee under Section 9.06
hereunder and no notice to Certificateholders of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.

         (d) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee and required to be conferred on such
co-trustee shall be conferred or imposed upon and exercised or performed by the
Trustee and such separate trustee or co-trustee jointly, except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed (whether as Trustee hereunder or as successor to the Master
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee at the direction of the Trustee.

         (e) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article IX. Each separate trustee and co-trustee, upon its acceptance of
the trusts

                                      -110-

<PAGE>

conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Trustee or separately, as may
be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.

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

         (g) No trustee under this Agreement shall be personally liable by
reason of any act or omission of another trustee under this Agreement. The
Depositor and the Trustee acting jointly may at any time accept the resignation
of or remove any separate trustee or co-trustee.

         Section 9.12 FEDERAL INFORMATION RETURNS AND REPORTS TO
CERTIFICATEHOLDERS; REMIC ADMINISTRATION. (a) For federal income tax purposes,
the taxable year of each REMIC shall be a calendar year and the Securities
Administrator shall maintain or cause the maintenance of the books of each such
REMIC on the accrual method of accounting.

         (b) The Securities Administrator shall prepare and file or cause to be
filed with the Internal Revenue Service, and the Trustee shall sign, Federal tax
information returns or elections required to be made hereunder with respect to
each REMIC, the Trust Fund, if applicable, and the Certificates containing such
information and at the times and in the manner as may be required by the Code or
applicable Treasury regulations, and shall furnish to each Holder of
Certificates at any time during the calendar year for which such returns or
reports are made such statements or information at the times and in the manner
as may be required thereby, including, without limitation, reports relating to
interest, original issue discount and market discount or premium (using a
constant prepayment assumption of 250% PSA). The Securities Administrator will
apply for an Employee Identification Number from the IRS under Form SS-4 or any
other acceptable method for all tax entities. In connection with the foregoing,
the Securities Administrator shall timely prepare and file, and the Trustee
shall sign, IRS Form 8811, which shall provide the name and address of the
person who can be contacted to obtain information required to be reported to the
holders of regular interests in each REMIC (the "REMIC Reporting Agent"). The
Trustee shall make elections to treat each REMIC as a REMIC (which elections
shall apply to the taxable period ending December 31, 2003 and each calendar
year thereafter) in such manner as the Code or applicable Treasury regulations
may prescribe, and as described by the Securities Administrator. The Trustee
shall sign all tax information returns filed pursuant to this Section and any
other returns as may be required by the Code. The Holder of the Class R-I
Certificate is hereby designated as the "Tax Matters Person" (within the meaning
of Treas. Reg. ss.ss.1.860F-4(d)) for REMIC I, the Holder of the Class R-II
Certificate is hereby designated as the "Tax Matters Person" for REMIC II and
the Holder of the Class R-III Certificate is hereby designated as the "Tax
Matters Person" for REMIC III. The Securities Administrator is hereby designated
and appointed as the agent of each such Tax Matters Person. Any Holder of a
Residual Certificate will by acceptance thereof appoint the Securities
Administrator as

                                      -111-

<PAGE>

agent and attorney-in-fact for the purpose of acting as Tax Matters Person for
each REMIC during such time as the Securities Administrator does not own any
such Residual Certificate. In the event that the Code or applicable Treasury
regulations prohibit the Trustee from signing tax or information returns or
other statements, or the Securities Administrator from acting as agent for the
Tax Matters Person, the Trustee and the Securities Administrator shall take
whatever action that in its sole good faith judgment is necessary for the proper
filing of such information returns or for the provision of a tax matters person,
including designation of the Holder of a Residual Certificate to sign such
returns or act as tax matters person. Each Holder of a Residual Certificate
shall be bound by this Section.

         (c) The Securities Administrator shall provide upon request and receipt
of reasonable compensation, such information as required in Section
860D(a)(6)(B) of the Code to the Internal Revenue Service, to any Person
purporting to transfer a Residual Certificate to a Person other than a
transferee permitted by Section 5.05(b), and to any regulated investment
company, real estate investment trust, common trust fund, partnership, trust,
estate, organization described in Section 1381 of the Code, or nominee holding
an interest in a pass-through entity described in Section 860E(e)(6) of the
Code, any record holder of which is not a transferee permitted by Section
5.05(b) (or which is deemed by statute to be an entity with a disqualified
member).

         (d) The Securities Administrator shall prepare and file or cause to be
filed, and the Trustee shall sign, any state income tax returns required under
Applicable State Law with respect to each REMIC or the Trust Fund.

         (e) Notwithstanding any other provision of this Agreement, the Trustee
and the Securities Administrator shall comply with all federal withholding
requirements respecting payments to Certificateholders of interest or original
issue discount on the Mortgage Loans, that the Trustee or the Securities
Administrator reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee or the Securities Administrator withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee or the Securities
Administrator shall, together with its monthly report to such
Certificateholders, indicate such amount withheld.

         (f) The Trustee and the Securities Administrator agree to indemnify the
Trust Fund and the Depositor for any taxes and costs including, without
limitation, any reasonable attorneys fees imposed on or incurred by the Trust
Fund, the Depositor or the Master Servicer, as a result of a breach of the
Trustee's covenants and the Securities Administrator's covenants, respectively,
set forth in this Section 9.12; provided, however, such liability and obligation
to indemnify in this paragraph shall not be joint and several and neither the
Trustee nor the Securities Administrator shall be liable or be obligated to
indemnify the Trust Fund for the failure by the other to perform any duty under
this Agreement or the breach by the other of any covenant in this Agreement.

                                      -112-

<PAGE>

                                    ARTICLE X
                                   Termination

         Section 10.01 TERMINATION UPON REPURCHASE BY THE DEPOSITOR OR ITS
DESIGNEE OR LIQUIDATION OF THE MORTGAGE LOANS.

         (a) Subject to Section 10.02, the respective obligations and
responsibilities of the Depositor, the Trustee, the Master Servicer and the
Securities Administrator created hereby, other than the obligation of the
Trustee to make payments to Certificateholders as hereinafter set forth shall
terminate upon:

                  (i) the repurchase by or at the direction of the Depositor or
its designee of all of the Mortgage Loans and all related REO Property remaining
in the Trust at a price (in each case, the "Termination Purchase Price") equal
to the sum of (a) 100% of the Outstanding Principal Balance of each Mortgage
Loan (other than a Mortgage Loan related to REO Property) as of the date of
repurchase, net of the principal portion of any unreimbursed Monthly Advances
made by the purchaser, together with interest at the applicable Mortgage
Interest Rate accrued but unpaid to, but not including, the first day of the
month of repurchase, (b) the appraised value of any related REO Property, less
the good faith estimate of the Depositor of liquidation expenses to be incurred
in connection with its disposal thereof (but not more than the Outstanding
Principal Balance of the related Mortgage Loan, together with interest at the
applicable Mortgage Interest Rate accrued on that balance but unpaid to, but not
including, the first day of the month of repurchase), such appraisal to be
calculated by an appraiser mutually agreed upon by the Depositor and the Trustee
at the expense of the Depositor plus payment due MBIA of all MBIA Reimbursement
Amounts, (c) unreimbursed out-of pocket costs of the Master Servicer, including
unreimbursed servicing advances and the principal portion of any unreimbursed
Monthly Advances, made on the Mortgage Loans prior to the exercise of such
repurchase right and (d) any unreimbursed costs and expenses of the Trustee and
the Securities Administrator payable pursuant to Section 9.05; or

                  (ii) the later of the making of the final payment or other
liquidation, or any advance with respect thereto, of the last Mortgage Loan
remaining in the Trust Fund or the disposition of all property acquired with
respect to any Mortgage Loan; provided, however, that in the event that an
advance has been made, but not yet recovered, at the time of such termination,
the Person having made such advance shall be entitled to receive,
notwithstanding such termination, any payments received subsequent thereto with
respect to which such advance was made; or

                  (iii) the payment to the Certificateholders and MBIA of all
amounts required to be paid to them pursuant to this Agreement.

         (b) In no event, however, shall the Trust created hereby continue
beyond the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late Ambassador of the United States to
the Court of St. James's, living on the date of this Agreement.

         (c) The right of the Depositor or its designee to repurchase all the
assets of the Trust Fund as described in Subsection 10.01(a)(i) above shall be
exercisable only if (i) the aggregate Scheduled Principal Balance of the
Mortgage Loans at the time of any such repurchase is less than

                                      -113-

<PAGE>

10% of the Cut-Off Date Balance, or (ii) the Depositor, based upon an Opinion of
Counsel addressed to the Depositor, the Trustee and the Securities
Administrator, has determined that the REMIC status of REMIC I, REMIC II or
REMIC III has been lost or that a substantial risk exists that such REMIC status
will be lost for the then-current taxable year. At any time thereafter, in the
case of (i) or (ii) above, the Depositor may elect to terminate REMIC I, REMIC
II and REMIC III at any time, and upon such election, the Depositor or its
designee, shall repurchase all the assets of the Trust Fund described in
Subsection 10.01(a)(i) above.

         (d) The Trustee shall give notice of any termination to the
Certificateholders, with a copy to the Master Servicer, the Securities
Administrator, MBIA and the Rating Agencies, upon which the Certificateholders
shall surrender their Certificates to the Trustee for payment of the final
distribution and cancellation. Such notice shall be given by letter, mailed not
earlier than the l5th day and not later than the 25th day of the month next
preceding the month of such final distribution, and shall specify (i) the
Distribution Date upon which final payment of the Certificates will be made upon
presentation and surrender of the Certificates at the office of the Trustee
therein designated, (ii) the amount of any such final payment and (iii) that the
Record Date otherwise applicable to such Distribution Date is not applicable,
payments being made only upon presentation and surrender of the Certificates at
the office of the Trustee therein specified.

         (e) If the option of the Depositor to repurchase or cause the
repurchase of all the assets in the Trust Fund as described in Subsection
10.01(a)(i) above, is exercised, the Depositor and/or its designee shall deliver
to the Trustee for deposit in the Distribution Account, by the Business Day
prior to the applicable Distribution Date, an amount equal to the Termination
Purchase Price. Upon presentation and surrender of the Certificates by the
Certificateholders, the Trustee shall distribute to such Certificateholders as
directed by the Securities Administrator in writing an amount determined as
follows: with respect to each Certificate (other than the Interest Only
Certificates and the Class R Certificates), the outstanding Current Principal
Amount, plus with respect to each Certificate (other than the Class R
Certificates), one month's interest thereon at the applicable Pass- Through
Rate; and with respect to the Class R Certificates, the percentage interest
evidenced thereby multiplied by the difference, if any, between the above
described repurchase price and the aggregate amount to be distributed to the
Holders of the Certificates (other than the Class R Certificates). If the
proceeds with respect to the Mortgage Loans are not sufficient to pay all of the
Senior Certificates in full, any such deficiency shall be allocated first, to
the Subordinate Certificates, in inverse order of their numerical designations
and then to the Senior Certificates on a pro rata basis. Upon deposit of the
Termination Purchase Price and following such final Distribution Date, the
Trustee shall release promptly to the Depositor and/or its designee the Mortgage
Files for the remaining Mortgage Loans, and the Accounts with respect thereto
shall terminate, subject to the Trustee's obligation to hold any amounts payable
to the Certificateholders in trust without interest pending final distributions
pursuant to Subsection 10.01(g). Any other amounts remaining in the Accounts
will belong to the Depositor.

         (f) In the event that this Agreement is terminated by reason of the
payment or liquidation of all Mortgage Loans or the disposition of all property
acquired with respect to all Mortgage Loans under Subsection 10.01(a)(ii) above,
the Master Servicer shall deliver to the Trustee for deposit in the Distribution
Account all distributable amounts remaining in the Master Servicer Collection
Account. Upon the presentation and surrender of the Certificates, the Trustee
shall distribute to the

                                      -114-

<PAGE>

remaining Certificateholders, pursuant to the written direction of the
Securities Administrator and in accordance with their respective interests, all
distributable amounts remaining in the Distribution Account. Upon deposit by the
Master Servicer of such distributable amounts, and following such final
Distribution Date, the Trustee shall release promptly to the Depositor or its
designee the Mortgage Files for the remaining Mortgage Loans, and the Master
Servicer Collection Account and the Distribution Account shall terminate,
subject to the Trustee's obligation to hold any amounts payable to the
Certificateholders in trust without interest pending final distributions
pursuant to this Subsection 10.01(f).

         (g) If not all of the Certificateholders shall surrender their
Certificates for cancellation within six months after the time specified in the
above-mentioned written notice, the Trustee shall give a second written notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
six months after the second notice, not all the Certificates shall have been
surrendered for cancellation, the Trustee may take appropriate steps, or appoint
any agent to take appropriate steps, to contact the remaining Certificateholders
concerning surrender of their Certificates, and the cost thereof shall be paid
out of the funds and other assets which remain subject to this Agreement.

         Section 10.02 ADDITIONAL TERMINATION REQUIREMENTS. (a) If the option of
the Depositor to repurchase all of the Mortgage Loans under Subsection
10.01(a)(i) above is exercised, the Trust Fund and each REMIC shall be
terminated in accordance with the following additional requirements, unless the
Trustee and MBIA have been furnished with an Opinion of Counsel addressed to the
Trustee and MBIA to the effect that the failure of the Trust to comply with the
requirements of this Section 10.02 will not (i) result in the imposition of
taxes on "prohibited transactions" as defined in Section 860F of the Code on any
REMIC or (ii) cause any REMIC to fail to qualify as a REMIC at any time that any
Regular Certificates are outstanding:

                  (i) within 90 days prior to the final Distribution Date, at
the written direction of the Depositor, the Trustee, as agent for the respective
Tax Matters Persons, shall adopt a plan of complete liquidation of each REMIC in
the case of a termination under Subsection 10.01(a)(i), provided to it by the
Depositor, which meets the requirements of a "qualified liquidation" under
Section 860F of the Code and any regulations thereunder;

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

                  (iii) at or after the time of adoption of such a plan of
complete liquidation of each REMIC, and at or prior to the final Distribution
Date relating thereto, the Trustee shall sell for cash all of the assets of the
Trust to or at the direction of the Depositor, and each REMIC shall terminate at
such time.

         (b) By their acceptance of the Residual Certificates, the Holders
thereof hereby (i) agree to adopt such a plan of complete liquidation of the
related REMIC upon the written request of the Depositor, and to take such action
in connection therewith as may be reasonably requested by the

                                      -115-

<PAGE>

Depositor and (ii) appoint the Depositor as their attorney-in-fact, with full
power of substitution, for purposes of adopting such a plan of complete
liquidation. The Trustee shall adopt such plan of liquidation by filing the
appropriate statement on the final tax return of each REMIC. Upon complete
liquidation or final distribution of all of the assets of the Trust Fund, the
Trust Fund and each REMIC shall terminate.

                                      -116-

<PAGE>

                                   ARTICLE XI
                            Miscellaneous Provisions

         Section 11.01 INTENT OF PARTIES. The parties intend that each of REMIC
I, REMIC II and REMIC III shall be treated as a REMIC for federal income tax
purposes and that the provisions of this Agreement should be construed in
furtherance of this intent.

         Section 11.02 AMENDMENT. (a) This Agreement may be amended from time to
time by the Company, the Depositor, the Master Servicer, the Securities
Administrator and the Trustee, with the consent of MBIA but without notice to or
the consent of any of the Certificateholders, to cure any ambiguity, to correct
or supplement any provisions herein or therein that may be defective or
inconsistent with any other provisions herein or therein, to comply with any
changes in the Code or to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be inconsistent with the
provisions of this Agreement; provided, however, that such action shall not, as
evidenced by an Opinion of Independent Counsel, addressed to the Trustee and
MBIA, adversely affect in any material respect the interests of any
Certificateholder (determined without regard to the Policy).

         (b) This Agreement may also be amended from time to time by the
Company, the Master Servicer, the Depositor, the Securities Administrator and
the Trustee, with the consent of MBIA and the Holders of Certificates evidencing
Fractional Undivided Interests aggregating not less than 51% of the Trust Fund
or of the applicable Class or Classes, if such amendment affects only such Class
or Classes, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Certificateholders; provided, however, that no such
amendment shall (i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) reduce
the aforesaid percentage of Certificates the Holders of which are required to
consent to any such amendment, without the consent of the Holders of all
Certificates then outstanding, or (iii) cause any REMIC to fail to qualify as a
REMIC for federal income tax purposes, as evidenced by an Opinion of Independent
Counsel addressed to the Trustee and MBIA which shall be provided to the Trustee
and MBIA other than at the Trustee's expense or MBIA's expense. Notwithstanding
any other provision of this Agreement, for purposes of the giving or withholding
of consents pursuant to this Section 11.02(b), Certificates registered in the
name of or held for the benefit of the Depositor, the Securities Administrator,
the Master Servicer, or the Trustee or any Affiliate thereof shall be entitled
to vote their Fractional Undivided Interests with respect to matters affecting
such Certificates.

         (c) Promptly after the execution of any such amendment, the Trustee
shall furnish a copy of such amendment or written notification of the substance
of such amendment to each Certificateholder, with a copy to the Rating Agencies
and MBIA.

         (d) In the case of an amendment under Subsection 11.02(b) above, it
shall not be necessary for the Certificateholders to approve the particular form
of such an amendment. Rather, it shall be sufficient if the Certificateholders
approve the substance of the amendment. The manner of obtaining such consents
and of evidencing the authorization of the execution thereof by
Certificateholders shall be subject to such reasonable regulations as the
Trustee may prescribe.

                                      -117-

<PAGE>

         (e) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel
addressed to the Trustee stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee and the Securities
Administrator may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's or the Securities Administrator's own respective
rights, duties or immunities under this Agreement.

         Section 11.03 RECORDATION OF AGREEMENT. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the Mortgaged Properties are situated, and
in any other appropriate public recording office or elsewhere. The Depositor
shall effect such recordation, at the expense of the Trust upon the request in
writing of a Certificateholder, but only if such direction is accompanied by an
Opinion of Counsel (provided at the expense of the Certificateholder requesting
recordation) to the effect that such recordation would materially and
beneficially affect the interests of the Certificateholders or is required by
law.

         Section 11.04 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. (a) The death
or incapacity of any Certificateholder shall not terminate this Agreement or the
Trust, nor entitle such Certificateholder's legal representatives or heirs to
claim an accounting or to take any action or proceeding in any court for a
partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.

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

         (c) No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon, under or with respect to this Agreement against the
Depositor, the Securities Administrator, the Master Servicer or any successor to
any such parties unless (i) such Certificateholder previously shall have given
to the Trustee a written notice of a continuing default, as herein provided,
(ii) the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust Fund shall have made written request
upon the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs and expenses and liabilities to be
incurred therein or thereby, and (iii) the Trustee, for 60 days after its
receipt of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding.

         (d) No one or more Certificateholders shall have any right by virtue of
any provision of this Agreement to affect the rights of any other
Certificateholders or to obtain or seek to obtain priority or preference over
any other such Certificateholder, or to enforce any right under this Agreement,
except in the manner herein provided and for the equal, ratable and common
benefit of

                                      -118-

<PAGE>

all Certificateholders. For the protection and enforcement of the provisions of
this Section 11.04, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.

         Section 11.05 ACTS OF CERTIFICATEHOLDERS. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Agreement to be given or taken by Certificateholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Certificateholders in person or by an agent duly appointed in writing.
Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and,
where it is expressly required, to the Depositor. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and conclusive in favor of the Trustee and the
Depositor, if made in the manner provided in this Section 11.05.

         (b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the individual executing the same,
may also be proved in any other manner which the Trustee deems sufficient.

         (c) The ownership of Certificates (notwithstanding any notation of
ownership or other writing on such Certificates, except an endorsement in
accordance with Section 5.02 made on a Certificate presented in accordance with
Section 5.04) shall be proved by the Certificate Register, and neither the
Trustee, the Securities Administrator, the Depositor, the Master Servicer nor
any successor to any such parties shall be affected by any notice to the
contrary.

         (d) Any request, demand, authorization, direction, notice, consent,
waiver or other action of the holder of any Certificate shall bind every future
holder of the same Certificate and the holder of every Certificate issued upon
the registration of transfer or exchange thereof, if applicable, or in lieu
thereof with respect to anything done, omitted or suffered to be done by the
Trustee, the Securities Administrator, the Depositor, the Master Servicer or any
successor to any such party in reliance thereon, whether or not notation of such
action is made upon such Certificates.

         (e) In determining whether the Holders of the requisite percentage of
Certificates evidencing Fractional Undivided Interests have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
Certificates owned by the Trustee, the Securities Administrator, the Depositor,
the Master Servicer or any Affiliate thereof shall be disregarded, except as
otherwise provided in Section 11.02(b) and except that, in determining whether
the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates which a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Certificates which have been pledged in good faith to the Trustee,
the Securities Administrator, the Depositor, the Master Servicer or any
Affiliate thereof may be regarded as outstanding if the pledgor establishes to
the satisfaction of the Trustee the pledgor's right to act with

                                      -119-

<PAGE>

respect to such Certificates and that the pledgor is not an Affiliate of the
Trustee, the Securities Administrator, the Depositor, or the Master Servicer, as
the case may be.

         Section 11.06 GOVERNING LAW. THIS AGREEMENT AND THE CERTIFICATES SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO ITS CONFLICT OF LAWS RULES (OTHER THAN SECTION 5- 1401 OF THE
GENERAL OBLIGATIONS LAW, WHICH THE PARTIES HERETO EXPRESSLY RELY UPON IN THE
CHOICE OF SUCH LAW AS THE GOVERNING LAW HEREUNDER) AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.

         Section 11.07 NOTICES. All demands and notices hereunder shall be in
writing and shall be deemed given when delivered at (including delivery by
facsimile) or mailed by registered mail, return receipt requested, postage
prepaid, or by recognized overnight courier, to (i) in the case of the
Depositor, 383 Madison Avenue, New York, New York 10179, Attention: Vice
President-Servicing, telecopier number: (212) 272-5591, or to such other address
as may hereafter be furnished to the other parties hereto in writing; (ii) in
the case of the Trustee, at its Corporate Trust Office, or such other address as
may hereafter be furnished to the other parties hereto in writing; (iii) in the
case of the Company, 383 Madison Avenue, New York, New York 10179, Attention:
Vice President- Servicing, telecopier number: (212) 272-5591, or to such other
address as may hereafter be furnished to the other parties hereto in writing;
(iv) in the case of the Master Servicer or Securities Administrator, Wells Fargo
Bank Minnesota, National Association, P.O. Box 98, Columbia Maryland 21046 (or,
in the case of overnight deliveries, 9062 Old Annapolis Road, Columbia, Maryland
21045) (Attention: Corporate Trust Services - Prime 2003-3), facsimile no.:
(410) 715- 2380, or such other address as may hereafter be furnished to the
other parties hereto in writing; (v) in the case of the Rating Agencies, Moody's
Investors Service, Inc., Residential Mortgage Monitoring Department, 99 Church
Street, New York, New York 10007 and Standard & Poor's, a division of The
McGraw-Hill Companies, Inc., 55 Water Street, New York, New York 10041, or (vi)
in the case of MBIA, MBIA Insurance Corporation, 113 King Street, Armonk, New
York 10504, Attention: Insured Portfolio Management - Structured Finance (Prime
Mortgage Trust 2003-3) or such other address as hereafter may be furnished to
the other parties in writing. Any notice delivered to the Depositor, the Master
Servicer, the Securities Administrator or the Trustee under this Agreement shall
be effective only upon receipt. Any notice required or permitted to be mailed to
a Certificateholder, unless otherwise provided herein, shall be given by
first-class mail, postage prepaid, at the address of such Certificateholder as
shown in the Certificate Register. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given when mailed, whether or not the Certificateholder receives such notice.

         Section 11.08 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severed from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.

                                      -120-

<PAGE>

         Section 11.09 SUCCESSORS AND ASSIGNS. The provisions of this Agreement
shall be binding upon and inure to the benefit of the respective successors and
assigns of the parties hereto.

         Section 11.10 ARTICLE AND SECTION HEADINGS. The article and section
headings herein are for convenience of reference only, and shall not limit or
otherwise affect the meaning hereof.

         Section 11.11 COUNTERPARTS. This Agreement may be executed in two or
more counterparts each of which when so executed and delivered shall be an
original but all of which together shall constitute one and the same instrument.

         Section 11.12 NOTICE TO RATING AGENCIES. The article and section
headings herein are for convenience of reference only, and shall not limited or
otherwise affect the meaning hereof. The Trustee shall promptly provide notice
to each Rating Agency and MBIA with respect to each of the following of which a
Responsible Officer of the Trustee has actual knowledge:

                  1. Any material change or amendment to this Agreement or the
         Servicing Agreements;

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

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

                  4. The repurchase or substitution of Mortgage Loans;

                  5. The final payment to Certificateholders; and

                  6. Any change in the location of the Master Servicer
         Collection Account or the Distribution Account.

         Section 11.13 MBIA RIGHTS.

                  (a) All notices, statements, reports, certificates, lists or
opinions required by this Agreement to be sent to the parties hereto, the Rating
Agencies or the Class A-6 Certificateholders shall also be sent at such time to
MBIA at the notice address set forth in Section 11.07.

                  (b) MBIA shall be an express third party beneficiary of this
Agreement for the purpose of enforcing the provisions hereof to the extent of
MBIA's rights explicitly specified herein as if a party hereto.

                  (c) All references herein to the ratings assigned to the
Certificates and to the interests of any Certificateholders shall be without
regard to the Policy.

                                      -121-

<PAGE>

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

                                        STRUCTURED ASSET MORTGAGE
                                        INVESTMENTS II INC., as Depositor

                                        By: /s/ Baron Silverstein
                                           -------------------------------------
                                        Name:   Baron Silverstein
                                        Title:  Vice President

                                        U.S. BANK NATIONAL ASSOCIATION, as
                                        Trustee

                                        By: /s/ Veneta I. Bernard
                                           -------------------------------------
                                        Name:   Veneta I. Bernard
                                        Title:  Vice President

                                        WELLS FARGO BANK MINNESOTA,
                                        NATIONAL ASSOCIATION, as Master
                                        Servicer

                                        By: /s/ Stacey Taylor
                                           -------------------------------------
                                        Name:   Stacey Taylor
                                        Title:  Assistant Vice President

                                        WELLS FARGO BANK MINNESOTA,
                                        NATIONAL ASSOCIATION, as Securities
                                        Administrator

                                        By: /s/ Stacey Taylor
                                           -------------------------------------
                                        Name:   Stacey Taylor
                                        Title:  Assistant Vice President

<PAGE>

                                        EMC MORTGAGE CORPORATION

                                        By: /s/ Sherri Lauritsen
                                           -------------------------------------
                                        Name:   Sherri Lauritsen
                                        Title:  Executive Vice President

Accepted and Agreed as to
Sections 2.01, 2.02, 2.03, 2.04 and 9.09(c)
in its capacity as Seller

EMC MORTGAGE CORPORATION

By: /s/ Sherri Lauritsen
   ------------------------------
Name:   Sherri Lauritsen
Title:  Executive Vice President

<PAGE>

STATE OF NEW YORK                   )
                                    ) ss.:
COUNTY OF NEW YORK                  )

         On the 23rd day of December, 2003 before me, a notary public in and for
said State, personally appeared Baron Silverstein, known to me to be a(n) Vice
President of Structured Asset Mortgage Investments II Inc., the corporation that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

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

                                                ________________________________
                                                           Notary Public

[Notarial Seal]

<PAGE>

STATE OF MASSACHUSETTS          )
                                ) ss.:
COUNTY OF SUFFOLK               )

         On the 23rd day of December, 2003 before me, a notary public in and for
said State, personally appeared Vaneta I Bernard, known to me to be a Vice
President of U.S. Bank National Association, the entity that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said entity, and acknowledged to me that such entity executed the within
instrument.

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

                                                ________________________________
                                                           Notary Public

[Notarial Seal]

<PAGE>

STATE OF MARYLAND       )
                        ) ss.:
COUNTY OF HOWARD        )

         On the 23rd day of December, 2003 before me, a notary public in and for
said State, personally appeared Stacey Taylor, known to me to be an Assistant
Vice President of Wells Fargo Bank Minnesota, National Association, the entity
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said entity, and acknowledged to me that such entity
executed the within instrument.

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

                                                ________________________________
                                                           Notary Public

[Notarial Seal]

<PAGE>

STATE OF MARYLAND           )
                            ) ss.:
COUNTY OF HOWARD            )

         On the 23rd day of December, 2003 before me, a notary public in and for
said State, personally appeared Stacey Taylor, known to me to be a(n) Assistant
Vice President of Wells Fargo Bank Minnesota, National Association, the entity
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said entity, and acknowledged to me that such entity
executed the within instrument.

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

                                                ________________________________
                                                           Notary Public

[Notarial Seal]

<PAGE>

STATE OF TEXAS          )
                        ) ss.:
COUNTY OF DALLAS        )

         On the 23rd day of December, 2003 before me, a notary public in and for
said State, personally appeared Sherri Lauritsen, known to me to be Executive
Vice President of EMC Mortgage Corporation, the corporation that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.

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

                                                ________________________________
                                                           Notary Public

[Notarial Seal]

<PAGE>

STATE OF TEXAS          )
                        ) ss.:
COUNTY OF DALLAS        )

         On the 23rd day of December, 2003 before me, a notary public in and for
said State, personally appeared Sherri Lauritsen, known to me to be Executive
Vice President of EMC Mortgage Corporation, the corporation that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.

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

                                                ________________________________
                                                           Notary Public

[Notarial Seal]

<PAGE>

                                                                     EXHIBIT A-1

                  FORM OF CLASS [_-[A]-[_][IO][PO] CERTIFICATE

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

                  [THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.]

                  UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUSTEE OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED WILL
BE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT WILL
BE MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.

                                      A-1-1

<PAGE>

<TABLE>
<CAPTION>
<S>                                                       <C>
Certificate No.1                                          [Variable][Adjustable][Fixed] Pass-Through
                                                          Rate

Class [_-[A]-[_][IO][PO] Senior

Date of Pooling and Servicing Agreement and               Aggregate Initial [Current Principal][Notional]
Cut-off Date:                                             Amount of this Senior Certificate as of the
December 1, 2003                                          Cut-off Date:
                                                          $[_____________]

First Distribution Date:                                  Initial [Current Principal][Notional] Amount of
January 26, 2003                                          this Senior Certificate as of the Cut-off Date:
                                                          $[_____________]

Master Servicer:
Wells Fargo Bank Minnesota, National
Association                                               CUSIP: [____________]

Assumed Final Distribution Date:
January 25, 2034
</TABLE>

                           PRIME MORTGAGE TRUST 2003-3
                        MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2003-3

         evidencing a fractional undivided interest in the distributions
         allocable to the Class [_-[A]-[_][IO][PO] Certificates with respect to
         a Trust Fund consisting primarily of a pool of fixed rate mortgage
         loans secured by first liens on one-to-four family residential
         properties sold by STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.

                  This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any
governmental entity or by Structured Asset Mortgage Investments II Inc., the
Master Servicer or the Trustee or any of their affiliates or any other person.
None of Structured Asset Mortgage Investments II Inc., the Master Servicer or
any of their affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.

                  This certifies that Cede & Co. is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") primarily consisting of fixed rate mortgage loans secured by first
liens on one- to four- family residential properties (collectively, the
"Mortgage Loans") sold by

                                      A-1-2

<PAGE>

Structured Asset Mortgage Investments II Inc. ("SAMI II"). The Mortgage Loans
were sold by EMC Mortgage Corporation ("EMC") to SAMI II. Wells Fargo Bank
Minnesota, National Association ("Wells Fargo") will act as master servicer of
the Mortgage Loans (the "Master Servicer", which term includes any successors
thereto under the Agreement referred to below). The Trust Fund was created
pursuant to the Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the "Agreement"), among EMC Mortgage Corporation, as seller and
company (the "Seller"), SAMI II, as depositor (the "Depositor"), Wells Fargo
Bank Minnesota, National Association as master servicer and securities
administrator (in such capacity, the "Securities Administrator") and U.S. Bank
National Association, as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound.

                  [Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the [Current Principal][Notional] Amount hereof at a per annum rate equal to
the Pass-Through Rate set forth above and as further described in the Agreement.
The Trustee will distribute on the 25th day of each month, or, if such 25th day
is not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount [(of interest
and] principal[, if any)] required to be distributed to the Holders of
Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the Distribution Date in the month immediately following
the month of the latest scheduled maturity date of any Mortgage Loan and is not
likely to be the date on which the [Current Principal][Notional] Amount of this
Class of Certificates will be reduced to zero.]

                  [Interest on this Certificate will accrue from and including
the 25th day of the calendar month preceding the month in which a Distribution
Date (as hereinafter defined) occurs (or, with respect to the first accrual
period, the Closing Date) to and including the 24th day of the calendar month in
which that Distribution Date occurs on the Current Principal Amount hereof at a
per annum rate equal to the Pass-Through Rate set forth above and as further
described in the Agreement. The Trustee will distribute on the 25th day of each
month, or, if such 25th day is not a Business Day, the immediately following
Business Day (each, a "Distribution Date"), commencing on the First Distribution
Date specified above, to the Person in whose name this Certificate is registered
at the close of business on the Business Day immediately preceding such
Distribution Date, an amount equal to the product of the Fractional Undivided
Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of
the same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.]

                                      A-1-3

<PAGE>

                  Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register or, if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The Initial [Current Principal][Notional] Amount of this
Certificate is set forth above. [The Current Principal Amount hereof will be
reduced to the extent of distributions allocable to principal hereon and any
Realized Losses allocable hereto.]

                  This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates"),
issued in nineteen Classes. The Certificates, in the aggregate, evidence the
entire beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

                  The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

                  This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the parties
thereto with the consent of the Holders of Certificates, evidencing Fractional
Undivided Interests aggregating not less than 51% of the Trust Fund (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the Trustee upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee for such purposes, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.

                  The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject

                                      A-1-4

<PAGE>

to certain limitations therein set forth, this Certificate is exchangeable for
one or more new Certificates evidencing the same Class and in the same aggregate
Fractional Undivided Interest, as requested by the Holder surrendering the same.

                  No service charge will be made to the Certificateholders for
any such registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the expiration of 21
years after the death of certain persons identified in the Agreement.

                  Unless this Certificate has been countersigned by an
authorized signatory of the Trustee by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any purpose.

                                      A-1-5

<PAGE>

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

Dated: __________, 20__                      U.S. BANK NATIONAL ASSOCIATION
                                             Not in its individual capacity but
                                             solely as Trustee

                                             By:________________________________
                                                      Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

                  This is one of the Class [_-[A]-[_][IO][PO] Certificates
referred to in the within- mentioned Agreement.

                                             U.S. BANK NATIONAL ASSOCIATION
                                             Authorized signatory of U.S. Bank
                                             National Association, not in its
                                             individual capacity but solely as
                                             Trustee

                                             By:________________________________
                                                     Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

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

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

Dated:                                  ________________________________________
                                          Signature by or on behalf of assignor

                                        ________________________________________
                                                Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

                  This information is provided by __________________, the
assignee named above, or ________________________, as its agent.

                                      A-1-7

<PAGE>

                                                                     EXHIBIT A-2

                         FORM OF CLASS [B-_] CERTIFICATE

                  THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO
THE SENIOR CERTIFICATES, [AND THE CLASS B-[_] CERTIFICATES] , AS
DESCRIBED IN THE AGREEMENT (AS DEFINED BELOW).

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

                  THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND ANY REALIZED LOSSES ALLOCABLE
HERETO. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE
CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE
DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS
CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.

                  [FOR CLASS B-1, CLASS B-2 AND CLASS B-3] [UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, ANY CERTIFICATE ISSUED WILL BE REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT WILL BE MADE TO
CEDE & CO. ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.]

                  [FOR CLASS B-1, CLASS B-2 AND CLASS B-3] [EACH BENEFICIAL
OWNER OF THIS CERTIFICATE OR ANY INTEREST HEREIN SHALL BE DEEMED TO HAVE
REPRESENTED, BY VIRTUE OF ITS ACQUISITION OR HOLDING OF THIS CERTIFICATE OR
INTEREST HEREIN, THAT EITHER (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED OR SECTION 4975
OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED ("PLAN"), OR INVESTING WITH
ASSETS OF A PLAN OR (II) IT HAS ACQUIRED AND IS HOLDING SUCH CERTIFICATE IN
RELIANCE ON PROHIBITED TRANSACTION EXEMPTION 90-30, AS AMENDED FROM TIME TO TIME
("EXEMPTION"), AND THAT IT UNDERSTANDS THAT THERE ARE CERTAIN CONDITIONS TO THE
AVAILABILITY OF THE EXEMPTION, INCLUDING THAT THE CERTIFICATE MUST BE RATED, AT
THE TIME OF PURCHASE, NOT LOWER THAN "BBB-" (OR ITS EQUIVALENT) BY STANDARD &
POOR'S, FITCH, INC. OR MOODY'S

                                      A-2-1

<PAGE>

INVESTORS SERVICE, INC., AND THE CERTIFICATE IS SO RATED OR (III) (1) IT IS AN
INSURANCE COMPANY, (2) THE SOURCE OF FUNDS USED TO ACQUIRE OR HOLD THE
CERTIFICATE OR INTEREST HEREIN IS AN "INSURANCE COMPANY GENERAL ACCOUNT", AS
SUCH TERM IS DEFINED IN PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 95-60,
AND (3) THE CONDITIONS IN SECTIONS I AND III OF PTCE 95-60 HAVE BEEN SATISFIED.]

         [FOR CLASS B-4, CLASS B-5 AND CLASS B-6][THIS CERTIFICATE HAS NOT BEEN
AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY
PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED,
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES
ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"),
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB,
WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR
OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR"
WITHIN THE MEANING THEREOF IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH
PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT,
SUBJECT TO (A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM
PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER
EVIDENCE ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER
IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND
ANY OTHER APPLICABLE JURISDICTION.]

         [FOR CLASS B-4, CLASS B-5 AND CLASS B-6] [THIS CERTIFICATE MAY NOT BE
ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, UNLESS THE TRANSFEREE CERTIFIES OR
REPRESENTS THAT THE PROPOSED TRANSFER AND HOLDING OF A CERTIFICATE AND THE
SERVICING, MANAGEMENT AND OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT
RESULT IN ANY PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR
CLASS PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO,
PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60
OR PTE 96-23 AND (II) WILL NOT GIVE RISE TO ANY

                                      A-2-2

<PAGE>

ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE SECURITIES
ADMINISTRATOR, THE MASTER SERVICER OR THE TRUSTEE, WHICH WILL BE DEEMED
REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE OR
UNLESS THE OPINION SPECIFIED IN SECTION 5.07 OF THE AGREEMENT IS PROVIDED.]

                                      A-2-3

<PAGE>

<TABLE>
<CAPTION>
<S>                                                       <C>
Certificate No.1                                          Pass-Through Rate: ____%

Class [B-_] Subordinate

Date of Pooling and Servicing Agreement and               Aggregate Initial Current Principal Amount of
Cut-off Date: December 1, 2003                            this Subordinate Certificate as of the Cut-off
                                                          Date: $[_________]

First Distribution Date:                                  Initial Current Principal Amount of this
January 26, 2003                                          Subordinate Certificate as of the Cut-off Date:
                                                          $[_________]

Master Servicer:
Wells Fargo Bank Minnesota, National
Association                                               CUSIP: [____________]

Assumed Final Distribution Date:
January 25, 2034
</TABLE>

                           PRIME MORTGAGE TRUST 2003-3
                        MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2003-3

         evidencing a fractional undivided interest in the distributions
         allocable to the Class [B-_] Certificates with respect to a Trust Fund
         consisting primarily of a pool of fixed rate mortgage loans secured by
         first liens on one-to-four family residential properties sold by
         STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.

                  This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any
governmental entity or by Structured Asset Mortgage Investments II Inc., the
Master Servicer or the Trustee or any of their affiliates or any other person.
None of Structured Asset Mortgage Investments II Inc., the Master Servicer or
any of their affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.

                  This certifies that [_______] is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a trust (the
"Trust Fund") primarily consisting of fixed rate mortgage loans secured by first
liens on one- to four- family residential properties (collectively, the
"Mortgage Loans") sold by Structured Asset Mortgage Investments II Inc. ("SAMI
II"). The Mortgage Loans were sold by EMC Mortgage Corporation ("EMC") to SAMI
II. Wells Fargo Bank Minnesota, National Association ("Wells Fargo") will act as
master servicer of the Mortgage Loans (the "Master Servicer", which

                                      A-2-4

<PAGE>

term includes any successors thereto under the Agreement referred to below). The
Trust Fund was created pursuant to the Pooling and Servicing Agreement dated as
of the Cut-off Date specified above (the "Agreement"), among EMC as seller and
company (the "Seller"), SAMI II, as depositor (the "Depositor"), Wells Fargo
Bank Minnesota, National Association as master servicer and securities
administrator (in such capacity, the "Securities Administrator"), and U.S. Bank
National Association, as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound.

                  Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Current Principal Amount hereof at a per annum rate equal to the
Pass-Through Rate set forth above and as further described in the Agreement. The
Trustee will distribute on the 25th day of each month, or, if such 25th day is
not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of
the same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.

                  Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register or, if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The Initial Current Principal Amount of this Certificate is set
forth above. The Current Principal Amount hereof will be reduced to the extent
of distributions allocable to principal hereon and any Realized Losses allocable
hereto.

                  [For Class B-4, Class B-5 and Class B-6][No transfer of this
Class [B-_] Certificate will be made unless such transfer is (i) exempt from the
registration requirements of the Securities act of 1933, as amended, and any
applicable state securities laws or is made in accordance with said Act and laws
and (ii) made in accordance with Section 5.02 of the Agreement. In the event
that such transfer is to be made the Trustee shall register such transfer if,
(i) made to a transferee who has provided the Trustee with evidence as to its
QIB status; or (ii) (A) the transferor has advised the Trustee in writing that
the Certificate is being transferred to an Institutional Accredited Investor and
(B) prior to such transfer the transferee furnishes to the Trustee an Investment
Letter; provided that if based upon an Opinion of Counsel to the effect that (A)
and (B) above are met sufficient to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and other applicable laws.]

                                      A-2-5

<PAGE>

                  [For Class B-1, Class B-2 and Class B-3] [Each beneficial
owner of this Certificate or any interest herein shall be deemed to have
represented, by virtue of its acquisition or holding of this certificate or
interest herein, that either (i) it is not an employee benefit plan subject to
the Employee Retirement Income Security Act of 1974, as amended or section 4975
of the Internal Revenue Code of 1986, as amended ("Plan"), or investing with
assets of a Plan or (ii) it has acquired and is holding such certificate in
reliance on Prohibited Transaction Exemption 90-30, as amended from time to time
("Exemption"), and that it understands that there are certain conditions to the
availability of the Exemption, including that the certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by Standard &
Poor's, Fitch, Inc. or Moody's Investors Service, Inc., and the certificate is
so rated or (iii) (1) it is an insurance company, (2) the source of funds used
to acquire or hold the certificate or interest therein is an "insurance company
general account", as such term is defined in Prohibited Transaction Class
Exemption ("PTCE") 95-60, and (3) the conditions in Sections I and III of PTCE
95-60 have been satisfied.]

         [For Class B-4, Class B-5 and Class B-6] [This Certificate may not be
acquired directly or indirectly by, or on behalf of, an employee benefit plan or
other retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, or Section 4975 of the
Internal Revenue Code of 1986, as amended, unless the transferee certifies or
represents that the proposed transfer and holding of a Certificate and the
servicing, management and operation of the trust and its assets: (i) will not
result in any prohibited transaction which is not covered under an individual or
class prohibited transaction exemption, including, but not limited to,
Prohibited Transaction Exemption ("PTE") 84-14, PTE 91-38, PTE 90-1, PTE 95-60
or PTE 96-23 and (ii) will not give rise to any additional obligations on the
part of the Depositor, the Securities Administrator, the Master Servicer or the
Trustee, which will be deemed represented by an owner of a Book-Entry
Certificate or a Global Certificate or unless the opinion specified in section
5.07 of the Agreement is provided.]

                  This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates"),
issued in nineteen Classes. The Certificates, in the aggregate, evidence the
entire beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

                  The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

                  This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the parties
thereto with the consent of the Holders of Certificates, evidencing Fractional
Undivided Interests aggregating not less than 51% of the Trust Fund (or in
certain cases, Holders of Certificates

                                      A-2-6

<PAGE>

of affected Classes evidencing such percentage of the Fractional Undivided
Interests thereof). Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the Trustee upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee for such purposes, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.

                  The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.

                  No service charge will be made to the Certificateholders for
any such registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the expiration of 21
years after the death of certain persons identified in the Agreement.

                  Unless this Certificate has been countersigned by an
authorized signatory of the Trustee by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any purpose.

                                      A-2-7

<PAGE>

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

Dated: __________, 20__                      U.S. BANK NATIONAL ASSOCIATION
                                             Not in its individual capacity but
                                             solely as Trustee

                                             By:________________________________
                                                      Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

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

                                             U.S. BANK NATIONAL ASSOCIATION
                                             Authorized signatory of U.S. Bank
                                             National Association, not in its
                                             individual capacity but solely as
                                             Trustee

                                             By:________________________________
                                                     Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

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

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

Dated:                                  ________________________________________
                                          Signature by or on behalf of assignor

                                        ________________________________________
                                                Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

                  This information is provided by __________________, the
assignee named above, or ________________________, as its agent.

                                                       A-2-9

<PAGE>

                                                                     EXHIBIT A-3

                         FORM OF CLASS R-[_] CERTIFICATE

                  THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A
NON-UNITED STATES PERSON, A PUBLICLY TRADED PARTNERSHIP OR A
DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).

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

                  THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY
BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, UNLESS THE PROPOSED TRANSFEREE PROVIDES THE TRUSTEE WITH AN OPINION OF
COUNSEL ADDRESSED TO THE TRUSTEE, DEPOSITOR, MASTER SERVICER AND SECURITIES
ADMINISTRATOR AND ON WHICH THEY MAY RELY THAT IS SATISFACTORY TO THE TRUSTEE
THAT THE PURCHASE OF CERTIFICATES ON BEHALF OF SUCH PERSON WILL NOT RESULT IN OR
CONSTITUTE A NONEXEMPT PROHIBITED TRANSACTION, IS PERMISSIBLE UNDER APPLICABLE
LAW AND WILL NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE PART OF THE
DEPOSITOR, THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR OR THE TRUSTEE.

                  ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE OBTAINS THE PRIOR WRITTEN CONSENT OF
STRUCTURED ASSET MORTGAGE INVESTMENTS II INC. AND THE SECURITIES ADMINISTRATOR
AND PROVIDES A TRANSFER AFFIDAVIT TO STRUCTURED ASSET MORTGAGE INVESTMENTS II
INC., THE SECURITIES ADMINISTRATOR AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS
NOT (A) THE UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY
FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A
COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX
IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX
IMPOSED BY SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION
1381(A)(2)(C) OF THE CODE, (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES
(A), (B) OR (C) BEING HEREIN REFERRED TO AS A "DISQUALIFIED ORGANIZATION") OR
(D) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER IS
TO

                                      A-3-1

<PAGE>

IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.

                                      A-3-2

<PAGE>

<TABLE>
<CAPTION>
<S>                                                       <C>
Certificate No.1                                          Pass-Through Rate: _____%

Class R-[_]

Date of Pooling and Servicing Agreement and               Aggregate Initial Current Principal Amount of
Cut-off Date: December 1, 2003                            this Certificate as of the Cut-off Date:
                                                          $___________

First Distribution Date:                                  Initial Current Principal Amount of this
January 26, 2003                                          Certificate as of the Cut-off Date: $_________

Master Servicer:
Wells Fargo Bank Minnesota, National
Association                                               CUSIP: [_____________]

Assumed Final Distribution Date:
January 25, 2034
</TABLE>

                           PRIME MORTGAGE TRUST 2003-3
                        MORTGAGE PASS-THROUGH CERTIFICATE
                                  SERIES 2003-3

         evidencing a fractional undivided interest in the distributions
         allocable to the Class R-[_] Certificates with respect to a Trust Fund
         consisting primarily of a pool of fixed rate mortgage loans secured by
         first liens on one-to-four family residential properties sold by
         STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.

                  This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any
governmental entity or by Structured Asset Mortgage Investments II Inc., the
Master Servicer or the Trustee or any of their affiliates or any other person.
None of Structured Asset Mortgage Investments II Inc., the Master Servicer or
any of their affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.

                  This certifies that Bear, Stearns Securities Corp. is the
registered owner of the Fractional Undivided Interest evidenced hereby in the
beneficial ownership interest of Certificates of the same Class as this
Certificate in a trust (the "Trust Fund") primarily consisting of fixed rate
mortgages loans secured by first liens on one- to four- family residential
properties (collectively, the "Mortgage Loans") sold by Structured Asset
Mortgage Investments II Inc. ("SAMI II"). The Mortgage Loans were sold by EMC
Mortgage Corporation ("EMC") to SAMI II. Wells Fargo Bank Minnesota, National
Association ("Wells Fargo") will act as master servicer of the Mortgage Loans
(the "Master Servicer", which term includes any successors thereto under the
Agreement referred

                                      A-3-3

<PAGE>

to below). The Trust Fund was created pursuant to the Pooling and Servicing
Agreement dated as of the Cut-off Date specified above (the "Agreement'), among
EMC Mortgage Corporation as seller and company (the "Seller"), SAMI II, as
depositor(the "Depositor"), Wells Fargo Bank Minnesota, National Association as
master servicer and securities administrator (in such capacity, the "Securities
Administrator"), and U.S. Bank National Association, as trustee (the "Trustee"),
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, capitalized terms used herein shall
have the meaning ascribed to them in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of its acceptance
hereof assents and by which such Holder is bound.

                  Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Current Principal Amount hereof at a per annum rate equal to the
Pass-Through Rate set forth above and as further described in the Agreement The
Trustee will distribute on the 25th day of each month, or, if such 25th day is
not a Business Day, the immediately following Business Day (each, a
"Distribution Date"), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close of
business on the last Business Day of the calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of
the same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.

                  Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register, or if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The Initial Current Principal Amount of this Certificate is set
forth above. The Current Principal Amount hereof will be reduced to the extent
of distributions allocable to principal hereon and any Realized Losses allocable
hereto.

                  Each Holder of this Certificate will be deemed to have agreed
to be bound by the restrictions set forth in the Agreement to the effect that
(i) each person holding or acquiring any Ownership Interest in this Certificate
must be a United States Person and a Permitted Transferee, (ii) the transfer of
any Ownership Interest in this Certificate will be conditioned upon the delivery
to SAMI II, the Trustee and the Securities Administrator of, among other things,
an affidavit to the effect that it is a United States Person and Permitted
Transferee, (iii) any attempted or purported transfer of any Ownership Interest
in this Certificate in violation of such restrictions will be absolutely null
and void and will vest no rights in the purported transferee, and (iv) if any
person other than a United States Person and a Permitted Transferee acquires any
Ownership Interest in this Certificate in violation of such restrictions, then
the Depositor will have the right, in its sole discretion and without notice to
the Holder of this Certificate, to sell this Certificate to a purchaser

                                      A-3-4

<PAGE>

selected by the Depositor, which purchaser may be the Depositor, or any
affiliate of the Depositor, on such terms and conditions as the Depositor may
choose.

                  This certificate may not be acquired directly or indirectly
by, or on behalf of, an employee benefit plan or other retirement arrangement
which is subject to title I of the Employee Retirement Income Security Act of
1974, as amended, and/or section 4975 of the Internal Revenue Code of 1986, as
amended, unless the proposed transferee provides the Trustee with an opinion of
counsel addressed to the Trustee, Master Servicer and the Securities
Administrator and on which they may rely (which shall not be at the expense of
the Trustee, Master Servicer or the Securities Administrator) which is
acceptable to the Trustee, that the purchase of this Certificate will not result
in or constitute a nonexempt prohibited transaction, is permissible under
applicable law and will not give rise to any additional fiduciary obligations on
the part of the Depositor, the Master Servicer or the Trustee.

                  This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates"),
issued in nineteen Classes. The Certificates, in the aggregate, evidence the
entire beneficial ownership interest in the Trust Fund formed pursuant to the
Agreement.

                  The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.

                  This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.

                  The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the parties
thereto with the consent of the Holders of Certificates, evidencing Fractional
Undivided Interests aggregating not less than 51% of the Trust Fund (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). Any such consent by
the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.

                  As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the Trustee upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee for such purposes, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and

                                      A-3-5

<PAGE>

thereupon one or more new Certificates in authorized denominations representing
a like aggregate Fractional Undivided Interest will be issued to the designated
transferee.

                  The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.

                  No service charge will be made to the Certificateholders for
any such registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, the Trustee and any agent of any
of them may treat the Person in whose name this Certificate is registered as the
owner hereof for all purposes, and none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.

                  The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the expiration of 21
years after the death of certain persons identified in the Agreement.

                  Unless this Certificate has been countersigned by an
authorized signatory of the Trustee by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any purpose.

                                      A-3-6

<PAGE>

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

Dated: __________, 20__                      U.S. BANK NATIONAL ASSOCIATION
                                             Not in its individual capacity but
                                             solely as Trustee

                                             By:________________________________
                                                      Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION
                          -----------------------------

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

                                             U.S. BANK NATIONAL ASSOCIATION
                                             Authorized signatory of U.S. Bank
                                             National Association, not in its
                                             individual capacity but solely as
                                             Trustee

                                             By:________________________________
                                                     Authorized Signatory

<PAGE>

                                   ASSIGNMENT
                                   ----------

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

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

Dated:                                  ________________________________________
                                          Signature by or on behalf of assignor

                                        ________________________________________
                                                Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

                  The assignee should include the following for purposes of
distribution:

                  Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________.

                  This information is provided by __________________, the
assignee named above, or ________________________, as its agent.

                                                       A-3-8

<PAGE>

                                                                       EXHIBIT B

                             MORTGAGE LOAN SCHEDULE
                             ----------------------

                  The Preliminary and Final Mortgage Loan Schedules shall set
forth the following information with respect to each Mortgage Loan:

(a) the loan number;

(b) the Mortgagor's name;

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

(d) the property type;

(e) the Mortgage Rate;

(f) the Servicer;

(g) the Servicing Rate;

(h) the Net Rate;

(i) the original term;

(j) the maturity date;

(k) the stated remaining term to maturity;

(l) the original principal balance;

(m) the first payment date;

(n) the principal and interest payment in effect as of the Cut-off Date;

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

(p) the Loan-to-Value Ratio at origination;

(q) paid-through date;

(r) the insurer of any Primary Mortgage Insurance Policy;

(s) the Gross Margin, if applicable;

(t) the Maximum Lifetime Mortgage Rate, if applicable;

                                       B-1

<PAGE>

(u) the Minimum Lifetime Mortgage Rate, if applicable;

(v) the Periodic Rate Cap, if applicable;

(w) the number of days delinquent, if any;

(x) which Mortgage Loans adjust after an initial fixed-rate period of three,
five, seven or ten years;

(y) The Loan Group; and

(z) The Prepayment Charge Loans.

Such schedule also shall set forth for all of the Mortgage Loans, the total
number of Mortgage Loans, the total of each of the amounts described under (k)
and (n) above, the weighted average by principal balance as of the Cut-off Date
of each of the rates described under (e), (f) and (g) above, and the weighted
average remaining term to maturity by unpaid principal balance as of the Cut-off
Date.

                                       B-2

<PAGE>

                                                                       EXHIBIT C

                                   [RESERVED]

                                       C-1

<PAGE>

                                                                       EXHIBIT D

                        REQUEST FOR RELEASE OF DOCUMENTS

To:      U.S. Bank National Association
         One Federal Street, 3rd Floor
         Boston, Massachusetts 02110

RE:      Pooling and Servicing Agreement dated as of
         December 1, 2003, among SAMI II,
         Wells Fargo Bank Minnesota,
         National Association, as Master Servicer
          and Securities Administrator,
         EMC Mortgage Corporation, as Seller
         and company and U.S. Bank National Association, as Trustee

         In connection with the administration of the Mortgage Loans held by you
pursuant to the above-captioned Pooling and Servicing Agreement, we request the
release, and hereby acknowledge receipt, of the Mortgage File for the Mortgage
Loan described below, for the reason indicated.

Mortgage Loan Number:
--------------------

Mortgagor Name, Address & Zip Code:
----------------------------------

Reason for Requesting Documents (check one):
-------------------------------------------

_____             1.       Mortgage Paid in Full and proceeds have been
                           deposited into the Custodial Account

_____             2.       Foreclosure

_____             3.       Substitution

_____             4.       Other Liquidation

_____             5.       Nonliquidation         Reason:_______________________

_____             6.       California Mortgage Loan paid in full

                                          By:_______________________________
                                                   (authorized signer)

                                          Issuer:___________________________
                                          Address:__________________________
                                          Date:_____________________________

                                       D-1

<PAGE>

                                                                       EXHIBIT E

                                FORM OF AFFIDAVIT

                                              Affidavit pursuant to Section
                                              860E(e)(4) of the Internal Revenue
                                              Code of 1986, as amended, and for
                                              other purposes

STATE OF                   )
                           ) ss:
COUNTY OF                  )

         [NAME OF OFFICER], being first duly sworn, deposes and says:

         1. That he is [Title of Officer] of [Name of Investor] (the
"Investor"), a [savings institution] [corporation] duly organized and existing
under the laws of [the State of ] [the United States], on behalf of which he
makes this affidavit.

         2. That (i) the Investor is not a "disqualified organization" as
defined in Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended
(the "Code"), and will not be a disqualified organization as of [Closing Date]
[date of purchase]; (ii) it is not acquiring the Structured Asset Mortgage
Investments II Inc., Prime Mortgage Trust, Mortgage Pass-Through Certificates,
Series 2003-3 Class R-I, Class R-II, and R-III Certificates (the "Residual
Certificates") for the account of a disqualified organization; (iii) it consents
to any amendment of the Pooling and Servicing Agreement that shall be deemed
necessary by Structured Asset Mortgage Investments II Inc. (upon advice of
counsel) to constitute a reasonable arrangement to ensure that the Residual
Certificates will not be owned directly or indirectly by a disqualified
organization; and (iv) it will not transfer such Residual Certificates unless
(a) it has received from the transferee an affidavit in substantially the same
form as this affidavit containing these same four representations and (b) as of
the time of the transfer, it does not have actual knowledge that such affidavit
is false.

         3. That the Investor is one of the following: (i) a citizen or resident
of the United States, (ii) a corporation or partnership (including an entity
treated as a corporation or partnership for federal income tax purposes) created
or organized in, or under the laws of, the United States or any state thereof or
the District of Columbia (except, in the case of a partnership, to the extent
provided in regulations), provided that no partnership or other entity treated
as a partnership for United States federal income tax purposes shall be treated
as a United States Person unless all persons that own an interest in such
partnership either directly or through any entity that is not a corporation for
United States federal income tax purposes are United States Persons, (iii) an
estate whose income is subject to United States federal income tax regardless of
its source, or (iv) a trust other than a "foreign trust," as defined in Section
7701 (a)(31) of the Code.

         4. That the Investor's taxpayer identification number is _____________.

                                       E-1

<PAGE>

         5. That no purpose of the acquisition of the Residual Certificates is
to avoid or impede the assessment or collection of tax.

         6. That the Investor understands that, as the holder of the Residual
Certificates, the Investor may incur tax liabilities in excess of any cash flows
generated by such Residual Certificates.

         7. That the Investor intends to pay taxes associated with holding the
Residual Certificates as they become due.

         IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
[Title of Officer] this ____ day of _________, 20__.

                                      [NAME OF INVESTOR]

                                      By:________________________
                                         [Name of Officer]
                                         [Title of Officer]
                                         [Address of Investor for receipt of
                                         distributions]

                                         Address of Investor for receipt of tax
                                         information:

                                       E-2

<PAGE>

         Personally appeared before me the above-named [Name of Officer], known
or proved to me to be the same person who executed the foregoing instrument and
to be the [Title of Officer] of the Investor, and acknowledged to me that he
executed the same as his free act and deed and the free act and deed of the
Investor.

         Subscribed and sworn before me this ___ day of _________, 20___.

NOTARY PUBLIC

COUNTY OF

STATE OF

My commission expires the ___ day of ___________________, 20___.

                                       E-3

<PAGE>

                                                                     EXHIBIT F-1

                            FORM OF INVESTMENT LETTER

                                                                          [Date]
[SELLER]

U.S. Bank National Association
One Federal Street, 3rd Floor
Boston, Massachusetts 02110

Structured Asset Mortgage Investments II Inc.
383 Madison Avenue
New York, New York 10179

         Re:      Structured Asset Mortgage Investments II Inc., Prime Mortgage
                  Trust, Series 2003-3 Mortgage Pass-Through Certificates (the
                  "Certificates"), including the Class B-4, Class B-5 and Class
                  B-6 Certificates (the "Privately Offered Certificates")
                  -------------------------------------------------------------

Dear Ladies and Gentlemen:

         In connection with our purchase of Privately Offered Certificates, we
confirm that:

                  (i)      we understand that the Privately Offered Certificates
                           are not being registered under the Securities Act of
                           1933, as amended (the "Act") or any applicable state
                           securities or "Blue Sky" laws, and are being sold to
                           us in a transaction that is exempt from the
                           registration requirements of such laws;

                  (ii)     any information we desired concerning the
                           Certificates, including the Privately Offered
                           Certificates, the trust in which the Certificates
                           represent the entire beneficial ownership interest
                           (the "Trust") or any other matter we deemed relevant
                           to our decision to purchase Privately Offered
                           Certificates has been made available to us;

                  (iii)    we are able to bear the economic risk of investment
                           in Privately Offered Certificates; we are an
                           institutional "accredited investor" as defined in
                           Section 501(a) of Regulation D promulgated under the
                           Act and a sophisticated institutional investor;

                  (iv)     we are acquiring Privately Offered Certificates for
                           our own account, not as nominee for any other person,
                           and not with a present view to any distribution or
                           other disposition of the Privately Offered
                           Certificates;

                  (v)      we agree the Privately Offered Certificates must be
                           held indefinitely by us (and may not be sold,
                           pledged, hypothecated or in any way disposed of)

                                      F-1-1

<PAGE>

                           unless subsequently registered under the Act and any
                           applicable state securities or "Blue Sky" laws or an
                           exemption from the registration requirements of the
                           Act and any applicable state securities or "Blue Sky"
                           laws is available;

                  (vi)     we agree that in the event that at some future time
                           we wish to dispose of or exchange any of the
                           Privately Offered Certificates (such disposition or
                           exchange not being currently foreseen or
                           contemplated), we will not transfer or exchange any
                           of the Privately Offered Certificates unless:

                                    (A) (1) the sale is to an Eligible Purchaser
                           (as defined below), (2) if required by the Pooling
                           and Servicing Agreement (as defined below) a letter
                           to substantially the same effect as either this
                           letter or, if the Eligible Purchaser is a Qualified
                           Institutional Buyer as defined under Rule 144A of the
                           Act, the Rule 144A and Related Matters Certificate in
                           the form attached to the Pooling and Servicing
                           Agreement (as defined below) (or such other
                           documentation as may be acceptable to the Trustee) is
                           executed promptly by the purchaser and delivered to
                           the addressees hereof and (3) all offers or
                           solicitations in connection with the sale, whether
                           directly or through any agent acting on our behalf,
                           are limited only to Eligible Purchasers and are not
                           made by means of any form of general solicitation or
                           general advertising whatsoever; and

                                    (B) if the Privately Offered Certificate is
                           not registered under the Act (as to which we
                           acknowledge you have no obligation), the Privately
                           Offered Certificate is sold in a transaction that
                           does not require registration under the Act and any
                           applicable state securities or "blue sky" laws and,
                           if U.S. Bank National Association (the "Trustee") so
                           requests, a satisfactory Opinion of Counsel is
                           furnished to such effect, which Opinion of Counsel
                           shall be an expense of the transferor or the
                           transferee;

                  (vii)    we agree to be bound by all of the terms (including
                           those relating to restrictions on transfer) of the
                           Pooling and Servicing, pursuant to which the Trust
                           was formed; we have reviewed carefully and understand
                           the terms of the Pooling and Servicing Agreement;

                  (viii)   we either: (i) are not acquiring the Privately
                           Offered Certificate directly or indirectly by, or on
                           behalf of, an employee benefit plan or other
                           retirement arrangement which is subject to Title I of
                           the Employee Retirement Income Security Act of 1974,
                           as amended, or section 4975 of the Internal Revenue
                           Code of 1986, as amended, or (ii) are providing a
                           representation to the effect that the proposed
                           transfer and holding of a Privately Offered
                           Certificate and the servicing, management and
                           operation of the Trust and its assets: (I) will not
                           result in any prohibited transaction which is not
                           covered under an individual or class prohibited
                           transaction exemption, including, but not limited to,
                           Prohibited Transaction Exemption ("PTE") 84-14, PTE
                           91-38,

                                      F-1-2

<PAGE>

                           PTE 90-1, PTE 95-60, or PTE 96-23 and (II) will not
                           give rise to any additional obligations on the part
                           of the Depositor, the Master Servicer, the Securities
                           Administrator or the Trustee or (iii) have attached
                           hereto the opinion specified in Section 5.07 of the
                           Agreement.

                  (ix)     We understand that each of the Privately Offered
                           Certificates bears, and will continue to bear, a
                           legend to substantiate the following effect: "THIS
                           CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED
                           UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
                           "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES
                           LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
                           CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE
                           REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
                           ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
                           APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A
                           UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON
                           THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
                           INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
                           (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
                           PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
                           HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
                           PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
                           RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
                           REGISTRATION PROVIDED BY RULE 144 UNDER THE
                           SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED
                           FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN
                           THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or
                           (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN
                           WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH
                           PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN
                           VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE
                           RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN
                           THE FORM PROVIDED IN THE AGREEMENT AND (B) THE
                           RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
                           ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE,
                           PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
                           SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH
                           CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
                           LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
                           JURISDICTION. THIS CERTIFICATE MAY NOT BE ACQUIRED
                           DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN
                           EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
                           WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE
                           RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED,
                           OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
                           AS AMENDED, UNLESS THE PROPOSED TRANSFER AND HOLDING
                           OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND
                           OPERATION OF THE TRUST AND ITS ASSETS:

                                      F-1-3

<PAGE>

                           (1) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION
                           WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS
                           PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT
                           LIMITED TO, PROHIBITED TRANSACTION EXEMPTION ("PTE")
                           84-14, PTE 91-38, PTE 90-1, PTE 95-60 OR PTE 96-23
                           AND (II) WILL NOT GIVE RISE TO ANY ADDITIONAL
                           OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE MASTER
                           SERVICER, THE SECURITIES ADMINISTRATOR OR THE
                           TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER
                           OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE
                           OR UNLESS THE OPINION PROVIDED IN SECTION 5.07 OF THE
                           AGREEMENT IS PROVIDED."

         "ELIGIBLE PURCHASER" means a corporation, partnership or other entity
which we have reasonable grounds to believe and do believe (i) can make
representations with respect to itself to substantially the same effect as the
representations set forth herein, and (ii) is either a Qualified Institutional
Buyer as defined under Rule 144A of the Act or an institutional "Accredited
Investor" as defined under Rule 501 of the Act.

         Terms not otherwise defined herein shall have the meanings assigned to
them in the Pooling and Servicing Agreement, dated as of December 1, 2003, among
Structured Asset Mortgage Investments II Inc., Wells Fargo Bank Minnesota,
National Association as master servicer and securities administrator, EMC
Mortgage Corporation, as seller and company and U.S. Bank National Association,
as Trustee (the "Pooling and Servicing Agreement').

         If the Purchaser proposes that its Certificates be registered in the
name of a nominee on its behalf, the Purchaser has identified such nominee
below, and has caused such nominee to complete the Nominee Acknowledgment at the
end of this letter.

Name of Nominee (if any):____________________

                                      F-1-4

<PAGE>

         IN WITNESS WHEREOF, this document has been executed by the undersigned
who is duly authorized to do so on behalf of the undersigned Eligible Purchaser
on the ___ day of ________, 20___.

                                               Very truly yours,

                                               [PURCHASER]

                                               By:______________________________
                                                        (Authorized Officer)

                                               [By:_____________________________
                                                        Attorney-in-fact]

                                      F-1-5

<PAGE>

                             Nominee Acknowledgment

         The undersigned hereby acknowledges and agrees that as to the
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Purchaser identified above, for whom the undersigned is acting
as nominee.

                                             [NAME OF NOMINEE]

                                             By:________________________________
                                                      (Authorized Officer)

                                             [By:_______________________________
                                                      Attorney-in-fact]

                                      F-1-6

<PAGE>

                                                                       EXHIBIT G

                           FORM OF CUSTODIAL AGREEMENT

                  THIS CUSTODIAL AGREEMENT (as amended and supplemented from
time to time, the "Agreement'), dated as of December 23, 2003, by and among U.S.
BANK NATIONAL ASSOCIATION, not individually but solely as trustee under the
Pooling and Servicing Agreement defined below (including its successors under
the Pooling and Servicing Agreement defined below, the "Trustee"), STRUCTURED
ASSET MORTGAGE INVESTMENTS II INC., as depositor (together with any successor in
interest, the "Depositor"), WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as
master servicer and securities administrator (together with any successor in
interest or successor under the Pooling and Servicing Agreement referred to
below, the "Master Servicer") and WELLS FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, as custodian (together with any successor in interest or any
successor appointed hereunder, the "Custodian").

                                WITNESSETH THAT:
                                ----------------

                  WHEREAS, the Depositor, the Master Servicer, the Trustee and
EMC Mortgage Corporation (the "Seller") have entered into a Pooling and
Servicing Agreement, dated as of December 1, 2003, relating to the issuance of
Prime Mortgage Trust 2003-3, Mortgage Pass-Through Certificates, Series 2003-2
(as in effect on the date of this agreement, the "Original Pooling and Servicing
Agreement," and as amended and supplemented from time to time, the "Pooling and
Servicing Agreement'); and

                  WHEREAS, the Custodian has agreed to act as agent for the
Trustee for the purposes of receiving and holding certain documents and other
instruments delivered by the Depositor or the Master Servicer under the Pooling
and Servicing Agreement and the Servicers under their respective Servicing
Agreements, all upon the terms and conditions and subject to the limitations
hereinafter set forth;

                  NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements hereinafter set forth, the Trustee, the
Depositor, the Master Servicer and the Custodian hereby agree as follows:

                                   ARTICLE I.
                                   DEFINITIONS

                  Capitalized terms used in this Agreement and not defined
herein shall have the meanings assigned in the Original Pooling and Servicing
Agreement, unless otherwise required by the context herein.

                                       G-1

<PAGE>

                                   ARTICLE II.
                          CUSTODY OF MORTGAGE DOCUMENTS

                  Section 2.1. Custodian to Act as Agent: Acceptance of Mortgage
Files. The Custodian, as the duly appointed custodial agent of the Trustee for
these purposes, acknowledges (subject to any exceptions noted in the Initial
Certification referred to in Section 2.3(a)), receipt of the Mortgage Files
relating to the Mortgage Loans identified on the schedule attached hereto (the
"Mortgage Files") and declares that it holds and will hold such Mortgage Files
as agent for the Trustee, in trust, for the use and benefit of all present and
future Certificateholders and MBIA Insurance Corporation.

                  Section 2.2. Recordation of Assignments. If any Mortgage File
includes one or more assignments of Mortgage to the Trustee in a state which is
specifically excluded from the Opinion of Counsel delivered by the Seller to the
Trustee and the Custodian pursuant to the provisions of Section 2.01 of the
Pooling and Servicing Agreement, each such assignment shall be delivered by the
Custodian to the Depositor for the purpose of recording it in the appropriate
public office for real property records, and the Depositor, at no expense to the
Custodian, shall promptly cause to be recorded in the appropriate public office
for real property records each such assignment of Mortgage and, upon receipt
thereof from such public office, shall return each such assignment of Mortgage
to the Custodian.

                  Section 2.3. Review of Mortgage Files.

                  (a) On or prior to the Closing Date, in accordance with
Section 2.02 of the Pooling and Servicing Agreement, the Custodian shall deliver
to the Trustee an Initial Certification in the form annexed hereto as Exhibit
One evidencing receipt (subject to any exceptions noted therein) of a Mortgage
File for each of the Mortgage Loans listed on the Schedule attached hereto (the
"Mortgage Loan Schedule").

                  (b) Within 90 days of the Closing Date, the Custodian agrees,
for the benefit of Certificateholders and MBIA Insurance Corporation, to review,
in accordance with the provisions of Section 2.02 of the Pooling and Servicing
Agreement, each such document, and shall deliver to the Depositor and the
Trustee an Interim Certification in the form annexed hereto as Exhibit Two to
the effect that all such documents have been executed and received and that such
documents relate to the Mortgage Loans identified on the Mortgage Loan Schedule,
except for any exceptions listed on Schedule A attached to such Interim
Certification. The Custodian shall be under no duty or obligation to inspect,
review or examine said documents, instruments, certificates or other papers to
determine that the same are genuine, enforceable, or appropriate for the
represented purpose or that they have actually been recorded or that they are
other than what they purport to be on their face.

                  (c) Not later than 180 days after the Closing Date, the
Custodian shall review the Mortgage Files as provided in Section 2.02 of the
Pooling and Servicing Agreement and deliver to the Depositor and the Trustee a
Final Certification in the form annexed hereto as Exhibit Three evidencing the
completeness of the Mortgage Files.

                                       G-2

<PAGE>

                  (d) In reviewing the Mortgage Files as provided herein and in
the Pooling and Servicing Agreement, the Custodian shall make no representation
as to and shall not be responsible to verify (i) the validity, legality,
enforceability, due authorization, recordability, sufficiency or genuineness of
any of the documents included in any Mortgage File or (ii) the collectibility,
insurability, effectiveness or suitability of any of the documents in any
Mortgage File.

         Upon receipt of written request from the Trustee, the Custodian shall
as soon as practicable supply the Trustee with a list of all of the documents
relating to the Mortgage Loans missing from the Mortgage Files.

                  Section 2.4. Notification of Breaches of Representations and
Warranties. Upon discovery by the Custodian of a breach of any representation or
warranty made by the Depositor as set forth in the Pooling and Servicing
Agreement with respect to a Mortgage Loan relating to a Mortgage File, the
Custodian shall give prompt written notice to the Depositor, the related
Servicer and the Trustee.

                  Section 2.5. Custodian to Cooperate: Release of Mortgage
Files. Upon receipt of written notice from the Trustee that the Seller has
repurchased a Mortgage Loan pursuant to Article II of the Pooling and Servicing
Agreement, and that the purchase price therefore has been deposited in the
Master Servicer Collection Account or the Distribution Account, then the
Custodian agrees to promptly release to the Seller the related Mortgage File.

                  Upon the Custodian's receipt of a request for release (a
"Request for Release") substantially in the form of Exhibit D to the Pooling and
Servicing Agreement signed by a Servicing Officer of the related Servicer
stating that it has received payment in full of a Mortgage Loan or that payment
in full will be escrowed in a manner customary for such purposes, the Custodian
agrees promptly to release to the related Servicer the related Mortgage File.
The Depositor shall deliver to the Custodian and the Custodian agrees to accept
the Mortgage Note and other documents constituting the Mortgage File with
respect to any Substitute Mortgage Loan.

                  From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any Primary Insurance Policy, the related Servicer (or if the Servicer does not,
the Master Servicer) shall deliver to the Custodian a Request for Release signed
by a Servicing Officer requesting that possession of all of the Mortgage File be
released to the related Servicer and certifying as to the reason for such
release and that such release will not invalidate any insurance coverage
provided in respect of the Mortgage Loan under any of the Insurance Policies.
Upon receipt of the foregoing, the Custodian shall deliver the Mortgage File to
the related Servicer. The related Servicer shall cause each Mortgage File or any
document therein so released to be returned to the Custodian when the need
therefore by the related Servicer no longer exists, unless (i) the Mortgage Loan
has been liquidated and the Liquidation Proceeds relating to the Mortgage Loan
have been deposited in the Master Servicer Collection Account or the
Distribution Account or (ii) the Mortgage File or such document has been
delivered to an attorney, or to a public trustee or other public official as
required by law, for purposes of initiating or pursuing legal action or other
proceedings for the foreclosure of the Mortgaged Property either judicially or
non-judicially, and the related Servicer has delivered to the Custodian a
certificate of a Servicing Officer certifying

                                       G-3

<PAGE>

as to the name and address of the Person to which such Mortgage File or such
document was delivered and the purpose or purposes of such delivery.

                  At any time that a Servicer is required to deliver to the
Custodian a Request for Release, the Servicer shall deliver two copies of the
Request for Release if delivered in hard copy or the Servicer may furnish such
Request for Release electronically to the Custodian, in which event the
Servicing Officer transmitting the same shall be deemed to have signed the
Request for Release. In connection with any Request for Release of a Mortgage
File because of a repurchase of a Mortgage Loan, such Request for Release shall
be followed by an assignment of mortgage, without recourse, representation or
warranty from the Trustee to the Seller and the related Mortgage Note shall be
endorsed without recourse by the Trustee and be returned to the Seller. In
connection with any Request for Release of a Mortgage File because of the
payment in full of a Mortgage Loan, such Request for Release shall be
accompanied by a certificate of satisfaction or other similar instrument to be
executed by or on behalf of the Trustee and returned to the related Servicer.

                  Section 2.6. Assumption Agreements. In the event that any
assumption agreement, substitution of liability agreement or sale of servicing
agreement is entered into with respect to any Mortgage Loan subject to this
Agreement in accordance with the terms and provisions of the Pooling and
Servicing Agreement, the Master Servicer, to the extent provided in the related
Servicing Agreement, shall cause the related Servicer to notify the Custodian
that such assumption or substitution agreement has been completed by forwarding
to the Custodian the original of such assumption or substitution agreement,
which shall be added to the related Mortgage File and, for all purposes, shall
be considered a part of such Mortgage File to the same extent as all other
documents and instruments constituting parts thereof.

                                  ARTICLE III.
                            CONCERNING THE CUSTODIAN

                  Section 3.1. Custodian as Bailee and Agent of the Trustee.
With respect to each Mortgage Note, Mortgage and other documents constituting
each Mortgage File which are delivered to the Custodian, the Custodian is
exclusively the bailee and custodial agent of the Trustee and has no
instructions to hold any Mortgage Note or Mortgage for the benefit of any person
other than the Trustee, MBIA Insurance Corporation and the Certificateholders
and undertakes to perform such duties and only such duties as are specifically
set forth in this Agreement and in the Pooling and Servicing Agreement. Except
upon compliance with the provisions of Section 2.5 of this Agreement, no
Mortgage Note, Mortgage or Mortgage File shall be delivered by the Custodian to
the Depositor, the Servicers or the Master Servicer or otherwise released from
the possession of the Custodian.

                  Section 3.2. Reserved.

                  Section 3.3. Custodian May Own Certificates. The Custodian in
its individual or any other capacity may become the owner or pledgee of
Certificates with the same rights it would have if it were not Custodian.

                  Section 3.4. Master Servicer to Pay Custodian's Fees and
Expenses. The Master Servicer covenants and agrees to pay to the Custodian from
time to time, and the Custodian shall be

                                       G-4

<PAGE>

entitled to, reasonable compensation for all services rendered by it in the
exercise and performance of any of the powers and duties hereunder of the
Custodian, and the Master Servicer will pay or reimburse the Custodian upon its
request for all reasonable expenses, disbursements and advances incurred or made
by the Custodian in accordance with any of the provisions of this Agreement
(including the reasonable compensation and the expenses and disbursements of its
counsel and of all persons not regularly in its employ), except any such
expense, disbursement or advance as may arise from its negligence or bad faith
or to the extent that such cost or expense is indemnified by the Depositor
pursuant to the Pooling and Servicing Agreement.

                  Section 3.5. Custodian May Resign; Trustee May Remove
Custodian. The Custodian may resign from the obligations and duties hereby
imposed upon it as such obligations and duties relate to its acting as Custodian
of the Mortgage Loans. Upon receiving such written notice of resignation, the
Trustee shall either take custody of the Mortgage Files itself and give prompt
written notice thereof to the Depositor, the Master Servicer, MBIA Insurance
Corporation and the Custodian, or promptly appoint a successor Custodian by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Custodian and one copy to the successor Custodian. If
the Trustee shall not have taken custody of the Mortgage Files and no successor
Custodian shall have been so appointed and have accepted appointment within 30
days after the giving of such written notice of resignation, the resigning
Custodian may petition any court of competent jurisdiction for the appointment
of a successor Custodian.

                  The Trustee may remove the Custodian at any time with the
consent of the Master Servicer. In such event, the Trustee shall appoint, or
petition a court of competent jurisdiction to appoint, a successor Custodian
hereunder. Any successor Custodian shall be a depository institution subject to
supervision or examination by federal or state authority, shall be able to
satisfy the other requirements contained in Section 3.7 and shall be
unaffiliated with the Servicer or the Depositor.

                  Any resignation or removal of the Custodian and appointment of
a successor Custodian pursuant to any of the provisions of this Section 3.5
shall become effective upon acceptance of appointment by the successor
Custodian. The Trustee shall give prompt notice to the Depositor, MBIA Insurance
Corporation and the Master Servicer of the appointment of any successor
Custodian. No successor Custodian shall be appointed by the Trustee without the
prior approval of the Depositor and the Master Servicer.

                  Section 3.6. Merger or Consolidation of Custodian. Any Person
into which the Custodian may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Custodian shall be a party, or any Person succeeding
to the business of the Custodian, shall be the successor of the Custodian
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding.

                  Section 3.7. Representations of the Custodian. The Custodian
hereby represents that it is a depository institution subject to supervision or
examination by a federal or state authority, has a combined capital and surplus
of at least $15,000,000 and is qualified to do business in the jurisdictions in
which it will hold any Mortgage File.

                                       G-5

<PAGE>

                                   ARTICLE IV.
                            MISCELLANEOUS PROVISIONS

                  Section 4.1. Notices. All notices, requests, consents and
demands and other communications required under this Agreement or pursuant to
any other instrument or document delivered hereunder shall be in writing and,
unless otherwise specifically provided, may be delivered personally, by telegram
or telex, or by registered or certified mail, postage prepaid, return receipt
requested, at the addresses specified on the signature page hereof (unless
changed by the particular party whose address is stated herein by similar notice
in writing), or in the case of MBIA Insurance Corporation, to 113 King Street,
Armonk, New York 10504, in which case the notice will be deemed delivered when
received.

                  Section 4.2. Amendments. No modification or amendment of or
supplement to this Agreement shall be valid or effective unless the same is in
writing and signed by all parties hereto, and neither the Depositor, the Master
Servicer nor the Trustee shall enter into any amendment hereof except as
permitted by the Pooling and Servicing Agreement. The Trustee shall give prompt
notice to the Custodian of any amendment or supplement to the Pooling and
Servicing Agreement and furnish the Custodian with written copies thereof.

                  Section 4.3. GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED A
CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

                  Section 4.4. Recordation of Agreement. To the extent permitted
by applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Depositor and at the Trust's expense, but
only upon direction accompanied by an Opinion of Counsel reasonably satisfactory
to the Depositor to the effect that the failure to effect such recordation is
likely to materially and adversely affect the interests of the
Certificateholders.

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

                  Section 4.5. Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.

                                       G-6

<PAGE>

                  IN WITNESS WHEREOF, this Agreement is executed as of the date
first above written.

Address:                                  U.S. BANK NATIONAL ASSOCIATION,
                                          not individually but solely as Trustee
One Federal Street, 3rd Floor
Boston, Massachusetts 02110
                                          By:
                                             -----------------------------------
Attention:                                Name:  Vaneta I. Bernard
Telecopy:                                 Title: Vice President
Confirmation:
Address:                                  STRUCTURED ASSET MORTGAGE
                                          INVESTMENTS II INC.
383 Madison Avenue
New York, New York 10179
                                          By:
                                             -----------------------------------
                                          Name:    Baron Silverstein
                                          Title:   Vice President

Address:                                  WELLS FARGO BANK MINNESOTA,
                                          NATIONAL ASSOCIATION, as Master
9062 Old Annapolis Road                   Servicer
Columbia, Maryland 21045

                                          By:
                                             -----------------------------------
                                          Name: Stacey Taylor
                                          Title:   Assistant Vice President

Address:                                  WELLS FARGO BANK MINNESOTA,
                                          NATIONAL ASSOCIATION, as Custodian
9062 Old Annapolis Road
Columbia, Maryland 21045                  By:
                                             -----------------------------------
                                          Name:    Stacey Taylor
                                          Title:   Assistant Vice President

                                       G-7

<PAGE>

STATE OF MASSACHUSETTS          )
                                )ss.:
COUNTY OF BOSTON                )

                  On the 23rd day of December 2003 before me, a notary public in
and for said State, personally appeared Vaneta I. Bernard, known to me to be a
Vice President of U.S. Bank National Association, a national banking association
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation and acknowledged to me that such
corporation executed the within instrument.

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

                                                __________________________
                                                       Notary Public

[SEAL]

                                       G-8

<PAGE>

STATE OF MARYLAND                   )
                                    ) ss.:
COUNTY OF HOWARD                    )

                  On the 23rd day of December 2003 before me, a notary public in
and for said State, personally appeared Stacey Taylor, known to me to be an
Assistant Vice President of Wells Fargo Bank Minnesota, National Association, a
national banking association that executed the within instrument, and also known
to me to be the person who executed it on behalf of said national banking
association, and acknowledged to me that such national banking association
executed the within instrument.

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

                                                __________________________
                                                       Notary Public
[SEAL]

                                       G-9

<PAGE>

STATE OF NEW YORK                   )
                                    )ss.:
COUNTY OF NEW YORK                  )

                  On the 23rd day of December 2003 before me, a notary public in
and for said State, personally appeared Baron Silverstein, known to me to be a
Vice President of Structured Asset Mortgage Investments II Inc., one of the
corporations that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.

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

                                                __________________________
                                                       Notary Public
[Notarial Seal]

                                      G-10

<PAGE>

STATE OF MARYLAND                   )
                                    )ss.:
COUNTY OF HOWARD                    )

                  On the 23rd day of December 2003 before me, a notary public in
and for said State, personally appeared Stacey Taylor, known to me to be an
Assistant Vice President of Wells Fargo Bank Minnesota, National Association,
one of the corporations that executed the within instrument, and also known to
me to be the person who executed it on behalf of said corporation, and
acknowledged to me that such corporation executed the within instrument.

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

                                                __________________________
                                                       Notary Public
[Notarial Seal]

                                      G-11

<PAGE>

                                   EXHIBIT ONE

                     FORM OF CUSTODIAN INITIAL CERTIFICATION

                                                 December __, 2003

U.S. Bank National Association Structured Asset Mortgage Investments II Inc. One
Federal Street, 3rd Floor 383 Madison Avenue Boston, Massachusetts 02110 New
York, New York 10179 MBIA Insurance Corporation 113 King Street
Armonk, New York 10504

Attention: Structured Asset Mortgage Investments II Inc.
Prime Mortgage Trust 2003-3, Mortgage Pass-Through Certificates, Series 2003-2

         Re:      Custodial Agreement, dated as of December 23, 2003, by and
                  among U.S. Bank National Association, Structured Asset
                  Mortgage Investments II Inc. and Wells Fargo Bank Minnesota,
                  National Association relating to Prime Mortgage Trust 2003-3,
                  Mortgage Pass-Through Certificates, Series 2003-3 Ladies and
                  Gentlemen:
                  -------------------------------------------------------------

                  In accordance with Section 2.3 of the above-captioned
Custodial Agreement, and subject to Section 2.02 of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File (which contains an original Mortgage Note or lost note
affidavit) to the extent required in Section 2.01 of the Pooling and Servicing
Agreement with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, with any exceptions listed on Schedule A attached hereto.

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Custodial Agreement.

                                                     WELLS FARGO BANK MINNESOTA,
                                                     NATIONAL ASSOCIATION

                                                     By:________________________
                                                     Name:
                                                     Title:

                                       -1-

<PAGE>

                                   EXHIBIT TWO

                     FORM OF CUSTODIAN INTERIM CERTIFICATION

                                                 ___________, 20__

U.S. Bank National Association Structured Asset Mortgage Investments II Inc. One
Federal Street, 3rd Floor 383 Madison Avenue Boston, Massachusetts 02110 New
York, New York 10179 MBIA Insurance Corporation 113 King Street
Armonk, New York 10504

Attention:  Structured Asset Mortgage Investments II Inc.
Prime Mortgage Trust 2003-3, Mortgage Pass-Through Certificates, Series 2003-2

         Re:      Custodial Agreement, dated as of December 23, 2003, by and
                  among U.S. Bank National Association, Structured Asset
                  Mortgage Investments II Inc. and Wells Fargo Bank Minnesota,
                  National Association relating to Prime Mortgage Trust 2003-3,
                  Mortgage Pass-Through Certificates, Series 2003-3
                  -------------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.3 of the above-captioned
Custodial Agreement, the undersigned, as Custodian, hereby certifies that it has
received a Mortgage File to the extent required pursuant to Section 2.01 of the
Pooling and Servicing Agreement with respect to each Mortgage Loan listed in the
Mortgage Loan Schedule, and it has reviewed the Mortgage File and the Mortgage
Loan Schedule and has determined that: all required documents have been executed
and received and that such documents related to the Mortgage Loans identified on
the Mortgage Loan Schedule, with any exceptions listed on Schedule A attached
hereto.

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Custodial Agreement.

                                                     WELLS FARGO BANK MINNESOTA,
                                                     NATIONAL ASSOCIATION

                                                     By:________________________
                                                     Name:______________________
                                                     Title:_____________________

                                       -1-

<PAGE>

                                  EXHIBIT THREE

                      FORM OF CUSTODIAN FINAL CERTIFICATION

                                                   _______, 20__

U.S. Bank National Association          Structured Asset Mortgage Investments
One Federal Street, 3rd Floor           II Inc.
Boston, Massachusetts 02110             383 Madison Avenue
                                        New New York 10179

MBIA Insurance Corporation
113 King Street
Armonk, New York 10504

Attention: Structured Asset Mortgage Investments II Inc.
Prime Mortgage Trust 2003-3, Mortgage Pass-Through Certificates, Series 2003-3

         Re:      Custodial Agreement, dated as of December 23, 2003, by and
                  among U.S. Bank National Association, Structured Asset
                  Mortgage Investments II Inc. and Wells Fargo Bank Minnesota,
                  National Association relating to Prime Mortgage Trust 2003-3,
                  Mortgage Pass-Through Certificates, Series 2003-3
                  -------------------------------------------------------------

Ladies and Gentlemen:

                  In accordance with Section 2.3 of the above-captioned
Custodial Agreement and subject to Section 2.02(b) of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule containing (I) with respect to each Mortgage Loan (other than a
Cooperative Loan):

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

                  (ii) The original Mortgage and, if the related Mortgage Loan
         is a MOM Loan, noting the presence of the MIN and language indicating
         that such Mortgage Loan is a MOM Loan, which shall have been recorded
         (or if the original is not available, a copy), with evidence of such
         recording indicated thereon (or if the original is not available, a
         copy), with evidence of such recording indicated thereon (or if the
         original Security Instrument, assignments to the

                                       -1-

<PAGE>

         Trustee or intervening assignments thereof which have been delivered,
         are being delivered or will, upon receipt of recording information
         relating to the Security Instrument required to be included thereon, be
         delivered to recording offices for recording and have not been returned
         to the Seller in time to permit their recording as specified in Section
         2.01(b) of the Pooling and Servicing Agreement, shall be in recordable
         form);

                  (iii) unless the Mortgage Loan is a MOM Loan, a certified copy
         of the assignment (which may be in the form of a blanket assignment if
         permitted in the jurisdiction in which the Mortgaged Property is
         located) to "U.S. Bank National Association, as Trustee", with evidence
         of recording with respect to each Mortgage Loan in the name of the
         Trustee thereon (or if (A) the original Security Instrument,
         assignments to the Trustee or intervening assignments thereof which
         have been delivered, are being delivered or will, upon receipt of
         recording information relating to the Security Instrument required to
         be included thereon, be delivered to recording offices for recording
         and have not been returned to the Seller in time to permit their
         delivery as specified in Section 2.01(b) of the Pooling and Servicing
         Agreement, a true copy thereof with a certification by the Seller, on
         the face of such copy, substantially as follows: "Certified to be a
         true and correct copy of the original, which has been transmitted for
         recording" or (B) the related Mortgaged Property is located in a state
         other than Maryland and an Opinion of Counsel has been provided as set
         forth in Section 2.01(b), shall be in recordable form);

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

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

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

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

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

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

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

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

                                       -2-

<PAGE>

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

                  (v) The Security Agreement;

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

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

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

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

                  Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Custodial Agreement
or in the Pooling and Servicing Agreement, as applicable.

                                                      WELLS FARGO BANK
                                                      MINNESOTA, NATIONAL
                                                      ASSOCIATION

                                                      By:_______________________
                                                      Name:_____________________
                                                      Title:____________________

                                       -3-

<PAGE>

                                                                     EXHIBIT H-1

                               SERVICING AGREEMENT

                                   COUNTRYWIDE

                             [provided upon request]

                                      H-1-1

<PAGE>

                                                                     EXHIBIT H-2

                               SERVICING AGREEMENT

                                       EMC

                             [provided upon request]

                                      H-2-1

<PAGE>

                                                                     EXHIBIT H-3

                               SERVICING AGREEMENT

                                      HSBC

                             [provided upon request]

                                      H-3-1

<PAGE>

                                                                     EXHIBIT H-4

                               SERVICING AGREEMENT

                                    SUNTRUST

                             [provided upon request]

                                      H-4-1

<PAGE>

                                                                     EXHIBIT H-5

                               SERVICING AGREEMENT

                                  UNION FEDERAL

                             [provided upon request]

                                      H-5-1

<PAGE>

                                                                       EXHIBIT I

                              ASSIGNMENT AGREEMENTS

                             [provided upon request]

                                       I-1

<PAGE>

                                                                       EXHIBIT J

                    FORM OF MORTGAGE LOAN PURCHASE AGREEMENT

                  MORTGAGE LOAN PURCHASE AGREEMENT, dated as of December 23,
2003, as amended and supplemented by any and all amendments hereto
(collectively, the "Agreement"), by and between EMC MORTGAGE CORPORATION, a
Delaware corporation (the "Mortgage Loan Seller"), and STRUCTURED ASSET MORTGAGE
INVESTMENTS II INC., a Delaware corporation (the "Purchaser").

                  Upon the terms and subject to the conditions of this
Agreement, the Mortgage Loan Seller agrees to sell, and the Purchaser agrees to
purchase, certain conventional, first lien mortgage loans secured primarily by
one- to four-family residential properties, [an interest in shares issued by a
cooperative apartment corporation and the related proprietary lease and
individual condominium units] (collectively, the "Mortgage Loans") as described
herein. The Purchaser intends to deposit the Mortgage Loans into a trust fund
(the "Trust Fund") and create Prime Mortgage Trust 2003-3, Mortgage Pass-Through
Certificates, Series 2003-3 (the "Certificates"), under a pooling and servicing
agreement, to be dated as of December 1, 2003 (the "Pooling and Servicing
Agreement"), among the Purchaser, as depositor, Wells Fargo Bank Minnesota,
National Association, as master servicer and securities administrator, U.S. Bank
National Association, as trustee (the "Trustee") and EMC Mortgage Corporation,
as seller and company.

                  The Purchaser has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (Number
333-106323) relating to its Mortgage Pass-Through Certificates and the offering
of certain series thereof (including certain classes of the Certificates) from
time to time in accordance with Rule 415 under the Securities Act of 1933, as
amended, and the rules and regulations of the Commission promulgated thereunder
(the "Securities Act"). Such registration statement, when it became effective
under the Securities Act, and the prospectus relating to the public offering of
certain classes of the Certificates by the Purchaser (the "Public Offering"), as
each may be amended or supplemented from time to time pursuant to the Securities
Act or otherwise, are referred to herein as the "Registration Statement" and the
"Prospectus," respectively. The "Prospectus Supplement" shall mean that
supplement, dated December [ ], 2003 to the Prospectus, dated September 29,
2003, relating to certain classes of the Certificates. With respect to the
Public Offering of certain classes of the Certificates, the Purchaser and Bear,
Stearns & Co. Inc. ("Bear Stearns") have entered into a terms agreement dated as
of December [ ], 2003 to an underwriting agreement dated July 29, 2003, between
the Purchaser and Bear Stearns (collectively, the "Underwriting Agreement").

                  Now, therefore, in consideration of the premises and the
mutual agreements set forth herein, the parties hereto agree as follows:

                                       J-1

<PAGE>

                                   ARTICLE I.

Definitions. Certain terms are defined herein. Capitalized terms used herein but
not defined herein shall have the meanings specified in the Pooling and
Servicing Agreement. The following other terms are defined as follows:

                  Acquisition Price: Cash in an amount equal to $______ (plus
$______ in accrued interest)1.

                  Bear Stearns: Bear, Stearns & Co. Inc.

                  Closing Date: December 23, 2003.

                  Cut-off Date: December 1, 2003.

                  Cut-off Date Balance: $315,392,475.

                  Deleted Mortgage Loan: A Mortgage Loan replaced or to be
replaced by a Substitute Mortgage Loan.

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

                  Master Servicer: Wells Fargo Bank Minnesota, National
Association.

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

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

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

                  Mortgage: The mortgage or deed of trust creating a first lien
on an interest in real property securing a Mortgage Note.

                  Mortgage File: The items referred to in Exhibit 1 pertaining
to a particular Mortgage Loan and any additional documents required to be added
to such documents pursuant to this Agreement.

                  Mortgage Interest Rate: The annual rate of interest borne by a
Mortgage Note as stated therein.

--------

         1Please contact Bear, Stearns & Co. Inc. for Purchase Price.

                                       J-2

<PAGE>

                  Mortgagor: The obligor(s) on a Mortgage Note.

                  Net Rate: For each Mortgage Loan, the Mortgage Interest Rate
for such Mortgage Loan less the Servicing Fee Rate and the Lender-Paid PMI Rate
(if applicable).

                  Opinion of Counsel: A written opinion of counsel, who may be
counsel for the Mortgage Loan Seller or the Purchaser, reasonably acceptable to
the Trustee.

                  Person: Any legal person, including any individual,
corporation, partnership, joint venture, association, joint stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.

                  Purchase Price: With respect to any Mortgage Loan (or any
property acquired with respect thereto) required to be repurchased by the
Mortgage Loan Seller pursuant to this Agreement or Article II of the Pooling and
Servicing Agreement, an amount equal to the sum of (i)(a) 100% of the
Outstanding Principal Balance of such Mortgage Loan as of the date of repurchase
(or if the related Mortgaged Property was acquired with respect thereto, 100% of
the Outstanding Principal Balance at the date of the acquisition), plus (b)
accrued but unpaid interest on the Outstanding Principal Balance at the related
Mortgage Interest Rate, through and including the last day of the month of
repurchase, plus (c) any unreimbursed Monthly Advances and servicing advances
payable to the Servicer of the Mortgage Loan and (ii) any costs and damages (if
any) incurred by the Trust in connection with any violation of such Mortgage
Loan of any predatory lending laws.

                  Rating Agencies: Standard & Poor's and Fitch, each a "Rating
Agency."

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

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

                  Servicing Agreements: Shall have the meaning assigned to such
term in the Pooling and Servicing Agreement.

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

                  Substitute Mortgage Loan: A mortgage loan substituted for a
Deleted Mortgage Loan which must meet on the date of such substitution the
requirements stated herein and in the Pooling and Servicing Agreement; upon such
substitution, such mortgage loan shall be a "Mortgage Loan" hereunder.

                  Value: The value of the Mortgaged Property at the time of
origination of the related Mortgage Loan, such value being the lesser of (i) the
value of such property set forth in an appraisal accepted by the applicable
originator of the Mortgage Loan or (ii) the sales price of such property at the
time of origination.

                                       J-3

<PAGE>

                                   ARTICLE II.

Purchase and Sale of the Mortgage Loans and Related Rights. 2.1. Upon
satisfaction of the conditions set forth in Section 10 hereof, the Mortgage Loan
Seller agrees to sell, and the Purchaser agrees to purchase Mortgage Loans
having an aggregate outstanding principal balance as of the Cut- off Date equal
to the Cut-off Date Balance.

                  Section 2.2. The closing for the purchase and sale of the
Mortgage Loans and the closing for the issuance of the Certificates will take
place on the Closing Date at the office of the Purchaser's counsel in New York,
New York or such other place as the parties shall agree.

                  Section 2.3. Upon the satisfaction of the conditions set forth
in Section 10 hereof, on the Closing Date, the Purchaser shall pay to the
Mortgage Loan Seller the Acquisition Price for the Mortgage Loans in immediately
available funds by wire transfer to such account or accounts as shall be
designated by the Mortgage Loan Seller.

                  Section 2.4. In addition to the foregoing, on the Closing Date
the Mortgage Loan Seller assigns to the Purchaser all of its right, title and
interest in the Servicing Agreements (other than its right to enforce the
representations and warranties set forth therein).

                                  ARTICLE III.

Mortgage Loan Schedules. The Mortgage Loan Seller agrees to provide to the
Purchaser as of the date hereof a preliminary listing of the Mortgage Loans (the
"Preliminary Mortgage Loan Schedule") setting forth the information listed on
Exhibit 2 to this Agreement with respect to each of the Mortgage Loans being
sold by the Mortgage Loan Seller. If there are changes to the Preliminary
Mortgage Loan Schedule, the Mortgage Loan Seller shall provide to the Purchaser
as of the Closing Date a final schedule (the "Final Mortgage Loan Schedule")
setting forth the information listed on Exhibit 2 to this Agreement with respect
to each of the Mortgage Loans being sold by the Mortgage Loan Seller to the
Purchaser. The Final Mortgage Loan Schedule shall be delivered to the Purchaser
on the Closing Date, shall be attached to an amendment to this Agreement to be
executed on the Closing Date by the parties hereto and shall be in form and
substance mutually agreed to by the Mortgage Loan Seller and the Purchaser (the
"Amendment"). If there are no changes to the Preliminary Mortgage Loan Schedule,
the Preliminary Mortgage Loan Schedule shall be the Final Mortgage Loan Schedule
for all purposes hereof.

                                   ARTICLE IV.

Mortgage Loan Transfer.

                  Section 4.1. The Purchaser will be entitled to all scheduled
payments of principal and interest on the Mortgage Loans due after the Cut-off
Date (regardless of when actually collected) and all payments thereon, other
than scheduled principal and interest due on or before the Cut-off Date but
received after the Cut-off Date. The Mortgage Loan Seller will be entitled to
all scheduled payments of principal and interest on the Mortgage Loans due on or
before the Cut-off Date (including payments collected after the Cut-off Date)
and all payments thereon, other than scheduled principal and interest due after
the Cut-off Date but received on or before the Cut-off Date. Such principal
amounts and any interest thereon belonging to the Mortgage Loan Seller as
described above

                                       J-4

<PAGE>

will not be included in the aggregate outstanding principal balance of the
Mortgage Loans as of the Cut-off Date as set forth on the Final Mortgage Loan
Schedule.

                  Section 4.2. Pursuant to various conveyancing documents to be
executed on the Closing Date and pursuant to the Pooling and Servicing
Agreement, the Purchaser will assign on the Closing Date all of its right, title
and interest in and to the Mortgage Loans to the Trustee for the benefit of the
Certificateholders and MBIA Insurance Corporation. In connection with the
transfer and assignment of the Mortgage Loans, the Mortgage Loan Seller has
delivered or will deliver or cause to be delivered to the Trustee by the Closing
Date or such later date as is agreed to by the Purchaser and the Mortgage Loan
Seller (each of the Closing Date and such later date is referred to as a
"Mortgage File Delivery Date"), the items of each Mortgage File, provided,
however, that in lieu of the foregoing, the Mortgage Loan Seller may deliver the
following documents, under the circumstances set forth below: (w) in lieu of the
original Security Instrument, assignments to the Trustee or intervening
assignments thereof which have been delivered, are being delivered or will, upon
receipt of recording information relating to the Security Instrument required to
be included thereon, be delivered to recording offices for recording and have
not been returned to the Mortgage Loan Seller in time to permit their delivery
as specified above, the Mortgage Loan Seller may deliver a true copy thereof
with a certification by the Mortgage Loan Seller, on the face of such copy,
substantially as follows: "Certified to be a true and correct copy of the
original, which has been transmitted for recording"; (x) in lieu of the Security
Instrument, assignments to the Trustee or intervening assignments thereof, if
the applicable jurisdiction retains the originals of such documents (as
evidenced by a certification from the Mortgage Loan Seller to such effect) the
Mortgage Loan Seller may deliver photocopies of such documents containing an
original certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; (y) in lieu of the Mortgage
Notes relating to the Mortgage Loans, each identified in the list delivered by
the Purchaser to the Trustee on the Closing Date and attached hereto as Exhibit
5, the Mortgage Loan Seller may deliver lost note affidavits and indemnities of
the Mortgage Loan Seller; and (z) the Mortgage Loan Seller shall not be required
to deliver intervening assignments or Mortgage Note endorsements between the
related Underlying Seller and the Mortgage Loan Seller, between the Mortgage
Loan Seller and the Depositor, and between the Depositor and the Trustee; and
provided further, however, that in the case of Mortgage Loans which have been
prepaid in full after the Cut- off Date and prior to the Closing Date, the
Mortgage Loan Seller, in lieu of delivering the above documents, may deliver to
the Trustee a certification by the Mortgage Loan Seller or the Master Servicer
to such effect and shall deposit all amounts paid in respect of such Mortgage
Loans in the Master Servicer Collection Account on the Closing Date. The
Mortgage Loan Seller shall deliver such original documents (including any
original documents as to which certified copies had previously been delivered)
or such certified copies to the Trustee promptly after they are received. The
Mortgage Loan Seller shall cause the Mortgage and intervening assignments, if
any, and the assignment of the Security Instrument to be recorded not later than
180 days after the Closing Date, unless such assignment is not required to be
recorded under the terms set forth in Section 6(a) hereof.

                  Section 4.3. In connection with the assignment of any Mortgage
Loan registered on the MERS(R) System, the Mortgage Loan Seller further agrees
that it will cause, at the Mortgage Loan Seller's own expense, within 30 days
after the Closing Date, the MERS(R) System to indicate that such Mortgage Loans
have been assigned by the Mortgage Loan Seller to the Purchaser and by the

                                       J-5

<PAGE>

Purchaser to the Trustee in accordance with this Agreement for the benefit of
the Certificateholders by including (or deleting, in the case of Mortgage Loans
which are repurchased in accordance with this Agreement) in such computer files
(a) the code in the field which identifies the specific Trustee and (b) the code
in the field "Pool Field" which identifies the series of the Certificates issued
in connection with such Mortgage Loans. The Mortgage Loan Seller further agrees
that it will not, and will not permit any Servicer or the Master Servicer to,
and the Master Servicer agrees that it will not, alter the codes referenced in
this paragraph with respect to any Mortgage Loan during the term of the Pooling
and Servicing Agreement unless and until such Mortgage Loan is repurchased in
accordance with the terms of the Pooling and Servicing Agreement.

                  Section 4.4. The Mortgage Loan Seller and the Purchaser
acknowledge hereunder that all of the Mortgage Loans and the related servicing
will ultimately be assigned to U.S. Bank National Association, as Trustee for
the Certificateholders, on the date hereof.

                                   ARTICLE V.

Examination of Mortgage Files.
-----------------------------

                  Section 5.1. On or before the Mortgage File Delivery Date, the
Mortgage Loan Seller will have made the Mortgage Files available to the
Purchaser or its agent for examination which may be at the offices of the
Trustee or the Mortgage Loan Seller and/or the Mortgage Loan Seller's custodian.
The fact that the Purchaser or its agent has conducted or has failed to conduct
any partial or complete examination of the Mortgage Files shall not affect the
Purchaser's rights to demand cure, repurchase, substitution or other relief as
provided in this Agreement. In furtherance of the foregoing, the Mortgage Loan
Seller shall make the Mortgage Files available to the Purchaser or its agent
from time to time so as to permit the Purchaser to confirm the Mortgage Loan
Seller's compliance with the delivery and recordation requirements of this
Agreement and the Pooling and Servicing Agreement. In addition, upon request of
the Purchaser, the Mortgage Loan Seller agrees to provide to the Purchaser, Bear
Stearns and to any investors or prospective investors in the Certificates
information regarding the Mortgage Loans and their servicing, to make the
Mortgage Files available to the Purchaser, Bear Stearns and to such investors or
prospective investors (which may be at the offices of the Mortgage Loan Seller
and/or the Mortgage Loan Seller's custodian) and to make available personnel
knowledgeable about the Mortgage Loans for discussions with the Purchaser, Bear
Stearns and such investors or prospective investors, upon reasonable request
during regular business hours, sufficient to permit the Purchaser, Bear Stearns
and such investors or potential investors to conduct such due diligence as any
such party reasonably believes is appropriate.

                  Section 5.2. Pursuant to the Pooling and Servicing Agreement,
on the Closing Date the Custodian, on behalf of the Trustee, for the benefit of
the Certificateholders and MBIA Insurance Corporation, will acknowledge receipt
of each Mortgage Loan, by delivery to the Mortgage Loan Seller, the Purchaser
and the Trustee of an initial certification in the form attached as Exhibit One
to the Custodial Agreement.

                  Section 5.3. Pursuant to the Pooling and Servicing Agreement,
within 90 days of the Closing Date (or, with respect to any Substitute Mortgage
Loan, within five Business Days after the receipt by the Trustee or Custodian
thereof), the Trustee will review or shall cause the Custodian to review items
of the Mortgage Files as set forth on Exhibit 1 and will deliver to the Mortgage
Loan

                                       J-6

<PAGE>

Seller, the Purchaser and the Trustee an interim certification substantially in
the form of Exhibit Two to the Custodial Agreement. If the Trustee or Custodian,
as its agent, finds any document listed on Exhibit 1 not to have been executed
or received, or to be unrelated, determined on the basis of the Mortgagor name,
original principal balance and loan number, to the Mortgage Loans identified in
the Final Mortgage Loan Schedule or to appear defective on its face (a "Material
Defect"), the Trustee or the Custodian, as its agent, shall promptly notify the
Mortgage Loan Seller of such Material Defect. The Mortgage Loan Seller shall
correct or cure any such Material Defect within 90 days from the date of notice
from the Trustee or the Custodian, as its agent, of the Material Defect and if
the Mortgage Loan Seller fails to correct or cure such Material Defect within
such period and such defect materially and adversely affects the interests of
the Certificateholders in the related Mortgage Loan, the Mortgage Loan Seller
will, in accordance with the terms of the Pooling and Servicing Agreement,
within 90 days of the date of notice, provide the Trustee with a Substitute
Mortgage Loan (if within two years of the Closing Date) or purchase the related
Mortgage Loan at the applicable Purchase Price; provided that, if such defect
would cause the Mortgage Loan to be other than a "qualified mortgage" as defined
in Section 860G(a)(3) of the Code, any such cure, repurchase or substitution
must occur within 90 days from the date such breach was discovered; provided,
however, that if such defect relates solely to the inability of the Mortgage
Loan Seller to deliver the original Security Instrument or intervening
assignments thereof, or a certified copy because the originals of such
documents, or a certified copy, have not been returned by the applicable
jurisdiction, the Mortgage Loan Seller shall not be required to purchase such
Mortgage Loan if the Mortgage Loan Seller delivers such original documents or
certified copy promptly upon receipt, but in no event later than 360 days after
the Closing Date. The foregoing repurchase obligation shall not apply in the
event that the Mortgage Loan Seller cannot deliver such original or copy of any
document submitted for recording to the appropriate recording office in the
applicable jurisdiction because such document has not been returned by such
office; provided that the Mortgage Loan Seller shall instead deliver a recording
receipt of such recording office or, if such receipt is not available, a
certificate confirming that such documents have been accepted for recording, and
delivery to the Trustee or the Custodian, as its agent, shall be effected by the
Mortgage Loan Seller within thirty days of its receipt of the original recorded
document.

                  Section 5.4. Pursuant to the Pooling and Servicing Agreement,
within 180 days of the Closing Date (or, with respect to any Substitute Mortgage
Loan, within five Business Days after the receipt by the Trustee or Custodian
thereof) the Trustee will review or cause the Custodian to review items of the
Mortgage Files as set forth on Exhibit 1 and will deliver to the Mortgage Loan
Seller, the Purchaser and the Trustee a final certification substantially in the
form of Exhibit Three to the Custodial Agreement. If the Trustee or Custodian,
as its agent, finds a Material Defect, the Trustee or the Custodian, as its
agent, shall promptly notify the Mortgage Loan Seller of such Material Defect.
The Mortgage Loan Seller shall correct or cure any such Material Defect within
90 days from the date of notice from the Trustee or the Custodian, as its agent,
of the Material Defect and if the Mortgage Loan Seller fails to correct or cure
such Material Defect within such period and such defect materially and adversely
affects the interests of the Certificateholders in the related Mortgage Loan,
the Mortgage Loan Seller will, in accordance with the terms of the Pooling and
Servicing Agreement, within 90 days of the date of notice, provide the Trustee
with a Substitute Mortgage Loan (if within two years of the Closing Date) or
purchase the related Mortgage Loan at the applicable Purchase Price; provided
that, if such defect would cause the Mortgage Loan to be other than a "qualified
mortgage" as defined in Section 860G(a)(3) of the Code, any such cure,

                                       J-7

<PAGE>

repurchase or substitution must occur within 90 days from the date such breach
was discovered; provided, however, that if such defect relates solely to the
inability of the Mortgage Loan Seller to deliver the original Security
Instrument or intervening assignments thereof, or a certified copy because the
originals of such documents, or a certified copy, have not been returned by the
applicable jurisdiction, the Mortgage Loan Seller shall not be required to
purchase such Mortgage Loan if the Mortgage Loan Seller delivers such original
documents or certified copy promptly upon receipt, but in no event later than
360 days after the Closing Date. The foregoing repurchase obligation shall not
apply in the event that the Mortgage Loan Seller cannot deliver such original or
copy of any document submitted for recording to the appropriate recording office
in the applicable jurisdiction because such document has not been returned by
such office; provided that the Mortgage Loan Seller shall instead deliver a
recording receipt of such recording office or, if such receipt is not available,
a certificate confirming that such documents have been accepted for recording,
and delivery to the Trustee or the Custodian, as its agent, shall be effected by
the Mortgage Loan Seller within thirty days of its receipt of the original
recorded document.

                  Section 5.5. At the time of any substitution, the Mortgage
Loan Seller shall deliver or cause to be delivered the Substitute Mortgage Loan,
the related Mortgage File and any other documents and payments required to be
delivered in connection with a substitution pursuant to the Pooling and
Servicing Agreement. At the time of any purchase or substitution, the Trustee in
accordance with the terms of the Pooling and Servicing Agreement shall (i)
assign to the Mortgage Loan Seller and cause the Custodian to release the
documents (including, but not limited to, the Mortgage, Mortgage Note and other
contents of the Mortgage File) in the possession of the Custodian relating to
the Deleted Mortgage Loan and (ii) execute and deliver such instruments of
transfer or assignment, in each case without recourse, as shall be necessary to
vest in the Mortgage Loan Seller title to such Deleted Mortgage Loan.

                                   ARTICLE VI.

Recordation of Assignments of Mortgage.
--------------------------------------

                  Section 6.1. The Mortgage Loan Seller shall cause each
assignment of the Security Instrument from the Mortgage Loan Seller to the
Trustee to be recorded not later than 180 days after the Closing Date, unless
(a) such recordation is not required by the Rating Agencies or an Opinion of
Counsel has been provided to the Trustee (with a copy to the Custodian) which
states that the recordation of such assignments is not necessary to protect the
interests of the Certificateholders in the related Mortgage Loans or (b) MERS is
identified on the Mortgage or a properly recorded assignment of the Mortgage, as
the Mortgagee of record solely as nominee for the Mortgage Loan Seller and its
successors and assigns; provided, however, notwithstanding the foregoing, each
assignment shall be submitted for recording by the Mortgage Loan Seller in the
manner described above, at no expense to the Trust or Trustee, upon the earliest
to occur of (i) reasonable direction by the Holders of Certificates evidencing
Fractional Undivided Interests aggregating not less than 25% of the Trust, (ii)
the occurrence of a Event of Default, (iii) the occurrence of a bankruptcy,
insolvency or foreclosure relating to the Mortgage Loan Seller and (iv) the
occurrence of a servicing transfer as described in Section 8.02 of the Pooling
and Servicing Agreement.

                  While each such Mortgage or assignment is being recorded, if
necessary, the Mortgage Loan Seller shall leave or cause to be left with the
Trustee a certified copy of such

                                       J-8

<PAGE>

Mortgage or assignment. All customary recording fees and reasonable expenses
relating to the recordation of the assignments of mortgage to the Trustee or the
Opinion of Counsel, as the case may be, shall be borne by the Mortgage Loan
Seller.

                  Section 6.2. It is the express intent of the parties hereto
that the conveyance of the Mortgage Loans by the Mortgage Loan Seller to the
Purchaser, as contemplated by this Agreement be, and be treated as, a sale. It
is, further, not the intention of the parties that such conveyance be deemed a
pledge of the Mortgage Loans by the Mortgage Loan Seller to the Purchaser to
secure a debt or other obligation of the Mortgage Loan Seller. However, in the
event that, notwithstanding the intent of the parties, the Mortgage Loans are
held by a court to continue to be property of the Mortgage Loan Seller, then (a)
this Agreement shall also be deemed to be a security agreement within the
meaning of Articles 8 and 9 of the applicable Uniform Commercial Code; (b) the
transfer of the Mortgage Loans provided for herein shall be deemed to be a grant
by the Mortgage Loan Seller to the Purchaser of a security interest in all of
the Mortgage Loan Seller's right, title and interest in and to the Mortgage
Loans and all amounts payable to the holders of the Mortgage Loans in accordance
with the terms thereof and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property, to the extent the Purchaser would otherwise be entitled to own such
Mortgage Loans and proceeds pursuant to Section 4 hereof, including all amounts,
other than investment earnings, from time to time held or invested in any
accounts created pursuant to the Pooling and Servicing Agreement, whether in the
form of cash, instruments, securities or other property; (c) the possession by
the Purchaser or the Trustee of Mortgage Notes and such other items of property
as constitute instruments, money, negotiable documents or chattel paper shall be
deemed to be "possession by the secured party" for purposes of perfecting the
security interest pursuant to Section 9-313 (or comparable provision) of the
applicable Uniform Commercial Code; and (d) notifications to persons holding
such property, and acknowledgments, receipts or confirmations from persons
holding such property, shall be deemed notifications to, or acknowledgments,
receipts or confirmations from, financial intermediaries, bailees or agents (as
applicable) of the Purchaser for the purpose of perfecting such security
interest under applicable law. Any assignment of the interest of the Purchaser
pursuant to any provision hereof or pursuant to the Pooling and Servicing
Agreement shall also be deemed to be an assignment of any security interest
created hereby. The Mortgage Loan Seller and the Purchaser shall, to the extent
consistent with this Agreement, take such actions as may be reasonably necessary
to ensure that, if this Agreement were deemed to create a security interest in
the Mortgage Loans, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of the Pooling and Servicing Agreement.

                                  ARTICLE VII.

Representations and Warranties of Mortgage Loan Seller Concerning the Mortgage
Loans. The Mortgage Loan Seller hereby represents and warrants to the Purchaser
as of the Closing Date or such other date as may be specified below with respect
to each Mortgage Loan being sold by it:

                  (i) the information set forth in the Mortgage Loan Schedule
         hereto is true and correct in all material respects and the information
         provided to the Rating Agencies, including the Mortgage Loan level
         detail, is true and correct according to the Rating Agency
         requirements;

                                       J-9

<PAGE>

                  (ii) immediately prior to the transfer to the Purchaser, the
         Mortgage Loan Seller was the sole owner of beneficial title and holder
         of each Mortgage and Mortgage Note relating to the Mortgage Loans and
         is conveying the same free and clear of any and all liens, claims,
         encumbrances, participation interests, equities, pledges, charges or
         security interests of any nature and the Mortgage Loan Seller has full
         right and authority to sell or assign the same pursuant to this
         Agreement;

                  (iii) Each Mortgage Loan at the time it was made complied in
         all material respects with all applicable laws and regulations,
         including, without limitation, usury, equal credit opportunity,
         disclosure and recording laws and all predatory lending laws; and each
         Mortgage Loan has been serviced in all material respects in accordance
         with all applicable laws and regulations, including, without
         limitation, usury, equal credit opportunity, disclosure and recording
         laws and all predatory lending laws and the terms of the related
         Mortgage Note, the Mortgage and other loan documents;

                  (iv) there is no monetary default existing under any Mortgage
         or the related Mortgage Note and there is no material event which, with
         the passage of time or with notice and the expiration of any grace or
         cure period, would constitute a default, breach or event of
         acceleration; and neither the Mortgage Loan Seller, any of its
         affiliates nor any servicer of any related Mortgage Loan has taken any
         action to waive any default, breach or event of acceleration; no
         foreclosure action is threatened or has been commenced with respect to
         the Mortgage Loan;

                  (v) the terms of the Mortgage Note and the Mortgage have not
         been impaired, waived, altered or modified in any respect, except by
         written instruments, (i) if required by law in the jurisdiction where
         the Mortgaged Property is located, or (ii) to protect the interests of
         the Trustee on behalf of the Certificateholders;

                  (vi) no selection procedure reasonably believed by the
         Mortgage Loan Seller to be adverse to the interests of the
         Certificateholders was utilized in selecting the Mortgage Loans;

                  (vii) each Mortgage is a valid and enforceable first lien on
         the property securing the related Mortgage Note and each Mortgaged
         Property is owned by the Mortgagor in fee simple (except with respect
         to common areas in the case of condominiums, PUDs and de minimis PUDs)
         or by leasehold for a term longer than the term of the related
         Mortgage, subject only to (i) the lien of current real property taxes
         and assessments, (ii) covenants, conditions and restrictions, rights of
         way, easements and other matters of public record as of the date of
         recording of such Mortgage, such exceptions being acceptable to
         mortgage lending institutions generally or specifically reflected in
         the appraisal obtained in connection with the origination of the
         related Mortgage Loan or referred to in the lender's title insurance
         policy delivered to the originator of the related Mortgage Loan and
         (iii) other matters to which like properties are commonly subject which
         do not materially interfere with the benefits of the security intended
         to be provided by such Mortgage;

                                      J-10

<PAGE>

                  (viii) there is no mechanics' lien or claim for work, labor or
         material affecting the premises subject to any Mortgage which is or may
         be a lien prior to, or equal with, the lien of such Mortgage except
         those which are insured against by the title insurance policy referred
         to in (xiiii) below;

                  (ix) as of the Cut-off Date, to the best of the Mortgage Loan
         Seller's knowledge, there was no delinquent tax or assessment lien
         against the property subject to any Mortgage, except where such lien
         was being contested in good faith and a stay had been granted against
         levying on the property;

                  (x) there is no valid offset, defense or counterclaim to any
         Mortgage Note or Mortgage, including the obligation of the Mortgagor to
         pay the unpaid principal and interest on such Mortgage Note;

                  (xi) to the best of the Mortgage Loan Seller's knowledge,
         except to the extent insurance is in place which will cover such
         damage, the physical property subject to any Mortgage is free of
         material damage and is in good repair and there is no proceeding
         pending or threatened for the total or partial condemnation of any
         Mortgaged Property;

                  (xii) to the best of the Mortgage Loan Seller's knowledge, the
         Mortgaged Property and all improvements thereon comply with all
         requirements of any applicable zoning and subdivision laws and
         ordinances;

                  (xiii) a lender's title insurance policy (on an ALTA or CLTA
         form) or binder, or other assurance of title customary in the relevant
         jurisdiction therefor in a form acceptable to Fannie Mae or Freddie
         Mac, was issued on the date that each Mortgage Loan was created by a
         title insurance company which, to the best of the Mortgage Loan
         Seller's knowledge, was qualified to do business in the jurisdiction
         where the related Mortgaged Property is located, insuring the Mortgage
         Loan Seller and its successors and assigns that the Mortgage is a first
         priority lien on the related Mortgaged Property in the original
         principal amount of the Mortgage Loan. The Mortgage Loan Seller is the
         sole insured under such lender's title insurance policy, and such
         policy, binder or assurance is valid and remains in full force and
         effect, and each such policy, binder or assurance shall contain all
         applicable endorsements including a negative amortization endorsement,
         if applicable;

                  (xiv) at the time of origination, each Mortgaged Property was
         the subject of an appraisal which conformed to the underwriting
         requirements of the originator of the Mortgage Loan;

                  (xv) as of the Closing Date, the improvements on each
         Mortgaged Property securing a Mortgage Loan is insured (by an insurer
         which is acceptable to the Mortgage Loan Seller) against loss by fire
         and such hazards as are covered under a standard extended coverage
         endorsement in the locale in which the Mortgaged Property is located,
         in an amount which is not less than the lesser of the maximum insurable
         value of the improvements securing such Mortgage Loan or the
         outstanding principal balance of the Mortgage Loan, but in no event in
         an amount less than an amount that is required to prevent the Mortgagor
         from

                                      J-11

<PAGE>

         being deemed to be a co-insurer thereunder; if the improvement on the
         Mortgaged Property is a condominium unit, it is included under the
         coverage afforded by a blanket policy for the condominium project; if
         upon origination of the related Mortgage Loan, the improvements on the
         Mortgaged Property were in an area identified as a federally designated
         flood area, a flood insurance policy is in effect in an amount
         representing coverage not less than the least of (i) the outstanding
         principal balance of the Mortgage Loan, (ii) the restorable cost of
         improvements located on such Mortgaged Property or (iii) the maximum
         coverage available under federal law; and each Mortgage obligates the
         Mortgagor thereunder to maintain the insurance referred to above at the
         Mortgagor's cost and expense;

                  (xvi) each Mortgage Loan constitutes a "qualified mortgage"
         under Section 860G(a)(3)(A) of the Code and Treasury Regulation Section
         1.860G-2(a)(1);

                  (xvii) each Mortgage Loan was originated or funded by (a) a
         savings and loan association, savings bank, commercial bank, credit
         union, insurance company or similar institution which is supervised and
         examined by a federal or state authority (or originated by (i) a
         subsidiary of any of the foregoing institutions which subsidiary is
         actually supervised and examined by applicable regulatory authorities
         or (ii) a mortgage loan correspondent of any of the foregoing and that
         was originated pursuant to the criteria established by any of the
         foregoing) or (b) a mortgagee approved by the Secretary of Housing and
         Urban Development pursuant to sections 203 and 211 of the National
         Housing Act, as amended;

                  (xviii) none of the Mortgage Loans are (a) loans subject to 12
         CFR Part 226.31, 12 CFR Part 226.32 or 12 CFR Part 226.34 of Regulation
         Z, the regulation implementing TILA, which implements the Home
         Ownership and Equity Protection Act of 1994, as amended or (b)
         classified and/or defined as a "high cost home loan" under any federal,
         state or local law, including, but not limited to, the States of
         Georgia or North Carolina; and

                  (xxix) the information set forth in Schedule A of the
         Prospectus Supplement with respect to the Mortgage Loans is true and
         correct in all material respects.

                  It is understood and agreed that the representations and
warranties set forth in this Section 7 will inure to the benefit of the
Purchaser, its successors and assigns, notwithstanding any restrictive or
qualified endorsement on any Mortgage Note or assignment of Mortgage or the
examination of any Mortgage File. Upon any substitution for a Mortgage Loan, the
representations and warranties set forth above shall be deemed to be made by the
Mortgage Loan Seller as to any Substitute Mortgage Loan as of the date of
substitution.

                  Upon discovery or receipt of notice by the Mortgage Loan
Seller, the Purchaser or the Trustee of a breach of any representation or
warranty of the Mortgage Loan Seller set forth in this Section 7 which
materially and adversely affects the value of the interests of the Purchaser,
the Certificateholders or the Trustee in any of the Mortgage Loans delivered to
the Purchaser pursuant to this Agreement, the party discovering or receiving
notice of such breach shall give prompt written notice to the others. In the
case of any such breach of a representation or warranty set forth in this
Section 7, within 90 days from the date of discovery by the Mortgage Loan
Seller, or the date the Mortgage Loan Seller is notified by the party
discovering or receiving notice of such breach

                                      J-12

<PAGE>

(whichever occurs earlier), the Mortgage Loan Seller will (i) cure such breach
in all material respects, (ii) purchase the affected Mortgage Loan at the
applicable Purchase Price or (iii) if within two years of the Closing Date,
substitute a qualifying Substitute Mortgage Loan in exchange for such Mortgage
Loan. The obligations of the Mortgage Loan Seller to cure, purchase or
substitute a qualifying Substitute Mortgage Loan shall constitute the
Purchaser's, the Trustee's and the Certificateholder's sole and exclusive remedy
under this Agreement or otherwise respecting a breach of representations or
warranties hereunder with respect to the Mortgage Loans, except for the
obligation of the Mortgage Loan Seller to indemnify the Purchaser for such
breach as set forth in and limited by Section 13 hereof.

                  Any cause of action against the Mortgage Loan Seller or
relating to or arising out of a breach by the Mortgage Loan Seller of any
representations and warranties made in this Section 7 shall accrue as to any
Mortgage Loan upon (i) discovery of such breach by the Mortgage Loan Seller or
notice thereof by the party discovering such breach and (ii) failure by the
Mortgage Loan Seller to cure such breach, purchase such Mortgage Loan or
substitute a qualifying Substitute Mortgage Loan pursuant to the terms hereof.

                                  ARTICLE VIII.

Representations and Warranties Concerning the Mortgage Loan Seller. As of the
date hereof and as of the Closing Date, the Mortgage Loan Seller represents and
warrants to the Purchaser as to itself in the capacity indicated as follows:

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

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

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

                  (d) the execution, delivery and performance by the Mortgage
Loan Seller of this Agreement and the consummation of the transactions
contemplated hereby do not require the consent or approval of, the giving of
notice to, the registration with, or the taking of any other action in respect
of, any state, federal or other governmental authority or agency, except those
consents,

                                      J-13

<PAGE>

approvals, notices, registrations or other actions as have already been
obtained, given or made and, in connection with the recordation of the
Mortgages, powers of attorney or assignments of Mortgages not yet completed;

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

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

                  (g) the Mortgage Loan Seller's Information (as defined in
Section 13(a) hereof) does not include any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements made,
in light of the circumstances under which they were made, not misleading.

                                   ARTICLE IX.

Representations and Warranties Concerning the Purchaser. As of the date hereof
and as of the Closing Date, the Purchaser represents and warrants to the
Mortgage Loan Seller as follows:

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

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

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

                                      J-14

<PAGE>

have a material adverse effect on the Purchaser's ability to enter into this
Agreement and to consummate the transactions contemplated hereby;

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

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

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

                  (g) the Purchaser's Information (as defined in Section 13(b)
hereof) does not include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading.

                                   ARTICLE X.

Conditions to Closing.

                  (a) The obligations of the Purchaser under this Agreement will
be subject to the satisfaction, on or prior to the Closing Date, of the
following conditions:

                           a. Each of the obligations of the Mortgage Loan
                  Seller required to be performed at or prior to the Closing
                  Date pursuant to the terms of this Agreement shall have been
                  duly performed and complied with in all material respects; all
                  of the representations and warranties of the Mortgage Loan
                  Seller under this Agreement shall be true and correct as of
                  the date or dates specified in all material respects; and no
                  event shall have occurred which, with notice or the passage of
                  time, would constitute a default under this Agreement, or the
                  Pooling and Servicing Agreement; and the Purchaser shall have
                  received certificates to that effect signed by authorized
                  officers of the Mortgage Loan Seller.

                                      J-15

<PAGE>

                           b. The Purchaser shall have received all of the
         following closing documents, in such forms as are agreed upon and
         reasonably acceptable to the Purchaser, duly executed by all
         signatories (other than the Purchaser) as required pursuant to the
         respective terms thereof:

                           (i) If required pursuant to Section 3 hereof, the
         Amendment dated as of the Closing Date and any documents referred to
         therein;

                           (ii) If required pursuant to Section 3 hereof, the
         Final Mortgage Loan Schedule containing the information set forth on
         Exhibit 2 hereto, one copy to be attached to each counterpart of the
         Amendment;

                           (iii) The Pooling and Servicing Agreement, in form
         and substance reasonably satisfactory to the Trustee and the Purchaser,
         and all documents required thereby duly executed by all signatories;

                           (iv) A certificate of an officer of the Mortgage Loan
         Seller dated as of the Closing Date, in a form reasonably acceptable to
         the Purchaser, and attached thereto the resolutions of the Mortgage
         Loan Seller authorizing the transactions contemplated by this
         Agreement, together with copies of the charter and by-laws of the
         Mortgage Loan Seller;

                           (v) One or more opinions of counsel from the Mortgage
         Loan Seller's counsel otherwise in form and substance reasonably
         satisfactory to the Purchaser, the Trustee and each Rating Agency;

                           (vi) A letter from each of the Rating Agencies giving
         each Class of Certificates set forth on Schedule A the rating set forth
         on Schedule A; and

                           (vii) Such other documents, certificates (including
         additional representations and warranties) and opinions as may be
         reasonably necessary to secure the intended ratings from each Rating
         Agency for the Certificates.

                        c. The Certificates to be sold to Bear Stearns pursuant
         to the Underwriting Agreement and the Purchase Agreement shall have
         been issued and sold to Bear Stearns.

                        d. The Mortgage Loan Seller shall have furnished to the
         Purchaser such other certificates of its officers or others and such
         other documents and opinions of counsel to evidence fulfillment of the
         conditions set forth in this Agreement and the transactions
         contemplated hereby as the Purchaser and its counsel may reasonably
         request.

                  (b) The obligations of the Mortgage Loan Seller under this
Agreement shall be subject to the satisfaction, on or prior to the Closing Date,
of the following conditions:

                        a. The obligations of the Purchaser required to be
         performed by it on or prior to the Closing Date pursuant to the terms
         of this Agreement shall have been duly performed and complied with in
         all material respects, and all of the representations and warranties of
         the

                                      J-16

<PAGE>

         Purchaser under this Agreement shall be true and correct in all
         material respects as of the date hereof and as of the Closing Date, and
         no event shall have occurred which would constitute a breach by it of
         the terms of this Agreement, and the Mortgage Loan Seller shall have
         received a certificate to that effect signed by an authorized officer
         of the Purchaser.

                        b. The Mortgage Loan Seller shall have received copies
         of all of the following closing documents, in such forms as are agreed
         upon and reasonably acceptable to the Mortgage Loan Seller, duly
         executed by all signatories other than the Mortgage Loan Seller as
         required pursuant to the respective terms thereof:

                           (i) If required pursuant to Section 3 hereof, the
         Amendment dated as of the Closing Date and any documents referred to
         therein;

                           (ii) The Pooling and Servicing Agreement, in form and
         substance reasonably satisfactory to the Mortgage Loan Seller, and all
         documents required thereby duly executed by all signatories;

                           (iii) A certificate of an officer of the Purchaser
         dated as of the Closing Date, in a form reasonably acceptable to the
         Mortgage Loan Seller, and attached thereto the resolutions of the
         Purchaser authorizing the transactions contemplated by this Agreement
         and the Pooling and Servicing Agreement, together with copies of the
         Purchaser's articles of incorporation, and evidence as to the good
         standing of the Purchaser dated as of a recent date;

                           (iv) One or more opinions of counsel from the
         Purchaser's counsel in form and substance reasonably satisfactory to
         the Mortgage Loan Seller;

                           (v) Such other documents, certificates (including
         additional representations and warranties) and opinions as may be
         reasonably necessary to secure the intended rating from each Rating
         Agency for the Certificates;

                                   ARTICLE XI.

Fees and Expenses. Subject to Section 16 hereof, the Mortgage Loan Seller shall
pay on the Closing Date or such later date as may be agreed to by the Purchaser
(i) the fees and expenses of the Mortgage Loan Seller's attorneys and the
reasonable fees and expenses of the Purchaser's attorneys, (ii) the fees and
expenses of Deloitte & Touche LLP, (iii) the fee for the use of Purchaser's
Registration Statement based on the aggregate original principal amount of the
Certificates and the filing fee of the Commission as in effect on the date on
which the Registration Statement was declared effective, (iv) the fees and
expenses including counsel's fees and expenses in connection with any "blue sky"
and legal investment matters, (v) the fees and expenses of the Trustee which
shall include without limitation the fees and expenses of the Trustee (and the
fees and disbursements of its counsel) with respect to (A) legal and document
review of this Agreement, the Pooling and Servicing Agreement, the Certificates
and related agreements, (B) attendance at the Closing and (C) review of the
Mortgage Loans to be performed by the Custodian, (vi) the expenses for printing
or otherwise reproducing the Certificates, the Prospectus and the Prospectus
Supplement, (vii) the fees and expenses of each Rating Agency (both initial and
ongoing), (viii) the fees and expenses relating

                                      J-17

<PAGE>

to the preparation and recordation of mortgage assignments (including
intervening assignments, if any and if available, to evidence a complete chain
of title from the originator to the Trustee) from the Mortgage Loan Seller to
the Trustee or the expenses relating to the Opinion of Counsel referred to in
Section 6(a) hereof, as the case may be, and (ix) Mortgage File due diligence
expenses and other out-of-pocket expenses incurred by the Purchaser in
connection with the purchase of the Mortgage Loans and by Bear Stearns in
connection with the sale of the Certificates. The Mortgage Loan Seller
additionally agrees to pay directly to any third party on a timely basis the
fees provided for above which are charged by such third party and which are
billed periodically.

                                  ARTICLE XII.

Accountants' Letters.

                  (a) Deloitte & Touche LLP will review the characteristics of a
sample of the Mortgage Loans described in the Final Mortgage Loan Schedule and
will compare those characteristics to the description of the Mortgage Loans
contained in the Prospectus Supplement under the captions "Summary of Prospectus
Supplement - The Mortgage Loans", "The Mortgage Pool" and "Certain
Characteristics of the Mortgage Loans" in Schedule A thereto. The Mortgage Loan
Seller will cooperate with the Purchaser in making available all information and
taking all steps reasonably necessary to permit such accountants to complete the
review and to deliver the letters required of them under the Underwriting
Agreement. Deloitte & Touche LLP will also confirm certain calculations as set
forth under the caption "Yield On The Certificates" in the Prospectus
Supplement.

                  (b) To the extent statistical information with respect to the
Master Servicer's or a Servicer's servicing portfolio is included in the
Prospectus Supplement under the caption "The Master Servicer and the Servicers,"
a letter from the certified public accountant for the Master Servicer and such
Servicer or Servicers will be delivered to the Purchaser dated the date of the
Prospectus Supplement, in the form previously agreed to by the Mortgage Loan
Seller and the Purchaser, with respect to such statistical information.

                                  ARTICLE XIII.

Indemnification.

                  (a) The Mortgage Loan Seller shall indemnify and hold harmless
the Purchaser and its directors, officers and controlling persons (as defined in
Section 15 of the Securities Act) from and against any loss, claim, damage or
liability or action in respect thereof, to which they or any of them may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon (i) any untrue
statement of a material fact contained in the Mortgage Loan Seller's Information
as identified in Exhibit 3, the omission to state in the Prospectus Supplement
or Prospectus (or any amendment thereof or supplement thereto approved by the
Mortgage Loan Seller and in which additional Mortgage Loan Seller's Information
is identified), in reliance upon and in conformity with Mortgage Loan Seller's
Information a material fact required to be stated therein or necessary to make
the statements therein in light of the circumstances in which they were made,
not misleading, (ii) any representation or warranty assigned or made by the
Mortgage Loan Seller in Section 7 or Section 8 hereof being, or alleged to be,
untrue or incorrect, or (iii) any failure by the Mortgage Loan Seller to perform
its obligations under this

                                      J-18

<PAGE>

Agreement; and the Mortgage Loan Seller shall reimburse the Purchaser and each
other indemnified party for any legal and other expenses reasonably incurred by
them in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action.

         The foregoing indemnity agreement is in addition to any liability which
the Mortgage Loan Seller otherwise may have to the Purchaser or any other such
indemnified party.

                  (b) The Purchaser shall indemnify and hold harmless the
Mortgage Loan Seller and its respective directors, officers and controlling
persons (as defined in Section 15 of the Securities Act) from and against any
loss, claim, damage or liability or action in respect thereof, to which they or
any of them may become subject, under the Securities Act or otherwise, insofar
as such loss, claim, damage, liability or action arises out of, or is based upon
(i) any untrue statement of a material fact contained in the Purchaser's
Information as identified in Exhibit 4, the omission to state in the Prospectus
Supplement or Prospectus (or any amendment thereof or supplement thereto
approved by the Purchaser and in which additional Purchaser's Information is
identified), in reliance upon and in conformity with the Purchaser's
Information, a material fact required to be stated therein or necessary to make
the statements therein in light of the circumstances in which they were made,
not misleading, (ii) any representation or warranty made by the Purchaser in
Section 9 hereof being, or alleged to be, untrue or incorrect, or (iii) any
failure by the Purchaser to perform its obligations under this Agreement; and
the Purchaser shall reimburse the Mortgage Loan Seller, and each other
indemnified party for any legal and other expenses reasonably incurred by them
in connection with investigating or defending or preparing to defend any such
loss, claim, damage, liability or action. The foregoing indemnity agreement is
in addition to any liability which the Purchaser otherwise may have to the
Mortgage Loan Seller, or any other such indemnified party,

                  (c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 13 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent it may elect by written notice delivered to the
indemnified party promptly (but, in any event, within 30 days) after receiving
the aforesaid notice from such indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party. Notwithstanding
the foregoing, the indemnified party or parties shall have the right to employ
its or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless (i)
the employment of such counsel shall have been authorized in writing by one of
the indemnifying parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to have charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) such indemnified party or parties shall have reasonably
concluded that there is a conflict of interest between itself or themselves and
the indemnifying party in the conduct of the defense of any claim or that the
interests of the indemnified party or parties are not substantially co-extensive
with those of the indemnifying party (in which case the indemnifying

                                      J-19

<PAGE>

parties shall not have the right to direct the defense of such action on behalf
of the indemnified party or parties), in any of which events such fees and
expenses shall be borne by the indemnifying parties (provided, however, that the
indemnifying party shall be liable only for the fees and expenses of one counsel
in addition to one local counsel in the jurisdiction involved. Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall not be
liable for any settlement or any claim or action effected without its written
consent; provided, however, that such consent was not unreasonably withheld.

                  (d) If the indemnification provided for in paragraphs (a) and
(b) of this Section 13 shall for any reason be unavailable to an indemnified
party in respect of any loss, claim, damage or liability, or any action in
respect thereof, referred to in Section 13, then the indemnifying party shall in
lieu of indemnifying the indemnified party contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage or
liability, or action in respect thereof, in such proportion as shall be
appropriate to reflect the relative benefits received by the Mortgage Loan
Seller on the one hand and the Purchaser on the other from the purchase and sale
of the Mortgage Loans, the offering of the Certificates and the other
transactions contemplated hereunder. No person found liable for a fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who is not also found liable
for such fraudulent misrepresentation.

                  (e) The parties hereto agree that reliance by an indemnified
party on any publicly available information or any information or directions
furnished by an indemnifying party shall not constitute negligence, bad faith or
willful misconduct by such indemnified party.

                                  ARTICLE XIV.

Notices. All demands, notices and communications hereunder shall be in writing
but may be delivered by facsimile transmission subsequently confirmed in
writing. Notices to the Mortgage Loan Seller shall be directed to EMC Mortgage
Corporation, Mac Arthur Ridge II, 909 Hidden Ridge Drive, Suite 200, Irving,
Texas 75038 (Telecopy: (972-444-2880)), and notices to the Purchaser shall be
directed to Structured Asset Mortgage Investments II Inc., 383 Madison Avenue,
New York, New York 10179 (Telecopy: (212-272-7206)), Attention: Baron
Silverstein; or to any other address as may hereafter be furnished by one party
to the other party by like notice. Any such demand, notice or communication
hereunder shall be deemed to have been received on the date received at the
premises of the addressee (as evidenced, in the case of registered or certified
mail, by the date noted on the return receipt) provided that it is received on a
business day during normal business hours and, if received after normal business
hours, then it shall be deemed to be received on the next business day.

                                   ARTICLE XV.

Transfer of Mortgage Loans. The Purchaser retains the right to assign the
Mortgage Loans and any or all of its interest under this Agreement to the
Trustee without the consent of the Mortgage Loan Seller, and, upon such
assignment, the Trustee shall succeed to the applicable rights and obligations
of the Purchaser hereunder; provided, however, the Purchaser shall remain
entitled to the benefits set forth in Sections 11, 13 and 17 hereto and as
provided in Section 2(a). Notwithstanding the foregoing, the sole and exclusive
right and remedy of the Trustee with respect to a breach of

                                      J-20

<PAGE>

representation or warranty of the Mortgage Loan Seller shall be the purchase or
substitution obligations of the Mortgage Loan Seller contained in Sections 5 and
7 hereof.

                                  ARTICLE XVI.

Termination. This Agreement may be terminated (a) by the mutual consent of the
parties hereto prior to the Closing Date, (b) by the Purchaser, if the
conditions to the Purchaser's obligation to close set forth under Section 10(a)
hereof are not fulfilled as and when required to be fulfilled or (c) by the
Mortgage Loan Seller, if the conditions to the Mortgage Loan Seller's obligation
to close set forth under Section 10(b) hereof are not fulfilled as and when
required to be fulfilled. In the event of termination pursuant to clause (b),
the Mortgage Loan Seller shall pay, and in the event of termination pursuant to
clause (c), the Purchaser shall pay, all reasonable out-of-pocket expenses
incurred by the other in connection with the transactions contemplated by this
Agreement. In the event of a termination pursuant to clause (a), each party
shall be responsible for its own expenses.

                                 ARTICLE XVII.

Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Mortgage Loan Seller submitted
pursuant hereto, shall remain operative and in full force and effect and shall
survive delivery of the Mortgage Loans to the Purchaser (and by the Purchaser to
the Trustee). Subsequent to the delivery of the Mortgage Loans to the Purchaser,
the Mortgage Loan Seller's representations and warranties contained herein with
respect to the Mortgage Loans shall be deemed to relate to the Mortgage Loans
actually delivered to the Purchaser and included in the Final Mortgage Loan
Schedule and any Substitute Mortgage Loan and not to those Mortgage Loans
deleted from the Preliminary Mortgage Loan Schedule pursuant to Section 3 hereof
prior to the Closing.

                                 ARTICLE XVIII.

Severability. If any provision of this Agreement shall be prohibited or invalid
under applicable law, the Agreement shall be ineffective only to such extent,
without invalidating the remainder of this Agreement.

                                  ARTICLE XIX.

Counterparts. This Agreement may be executed in counterparts, each of which will
be an original, but which together shall constitute one and the same agreement.

                                   ARTICLE XX.

Amendment. This Agreement cannot be amended or modified in any manner without
the prior written consent of each party.

                                  ARTICLE XXI.

GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE AND PERFORMED IN
THE STATE OF NEW YORK AND SHALL BE INTERPRETED IN ACCORDANCE WITH THE LAWS OF
SUCH STATE, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OF SUCH STATE.

                                      J-21

<PAGE>

                                  ARTICLE XXII.

Further Assurances. Each of the parties agrees to execute and deliver such
instruments and take such actions as another party may, from time to time,
reasonably request in order to effectuate the purpose and to carry out the terms
of this Agreement including any amendments hereto which may be required by
either Rating Agency.

                                 ARTICLE XXIII.

Successors and Assigns.

         This Agreement shall bind and inure to the benefit of and be
enforceable by the Mortgage Loan Seller and the Purchaser and their permitted
successors and assigns and, to the extent specified in Section 13 hereof, Bear
Stearns, and their directors, officers and controlling persons (within the
meaning of federal securities laws). The Mortgage Loan Seller acknowledges and
agrees that the Purchaser may assign its rights under this Agreement (including,
without limitation, with respect to the Mortgage Loan Seller's representations
and warranties respecting the Mortgage Loans) to the Trustee. Any person into
which the Mortgage Loan Seller may be merged or consolidated (or any person
resulting from any merger or consolidation involving the Mortgage Loan Seller),
any person resulting from a change in form of the Mortgage Loan Seller or any
person succeeding to the business of the Mortgage Loan Seller, shall be
considered the "successor" of the Mortgage Loan Seller hereunder and shall be
considered a party hereto without the execution or filing of any paper or any
further act or consent on the part of any party hereto. Except as provided in
the two preceding sentences, this Agreement cannot be assigned, pledged or
hypothecated by either party hereto without the written consent of the other
parties to this Agreement and any such assignment or purported assignment shall
be deemed null and void.

                                  ARTICLE XXIV.

The Mortgage Loan Seller. The Mortgage Loan Seller will keep in full effect all
rights as are necessary to perform their respective obligations under this
Agreement.

                                  ARTICLE XXV.

Entire Agreement. This Agreement contains the entire agreement and understanding
between the parties with respect to the subject matter hereof, and supersedes
all prior and contemporaneous agreements, understandings, inducements and
conditions, express or implied, oral or written, of any nature whatsoever with
respect to the subject matter hereof.

                                  ARTICLE XXVI.

No Partnership. Nothing herein contained shall be deemed or construed to create
a partnership or joint venture between the parties hereto.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      J-22

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective duly authorized officers as of the date first
above written.

                                        EMC MORTGAGE CORPORATION

                                        By:______________________________
                                        Name:    Sherri Lauritsen
                                        Title:   Executive Vice President

                                        STRUCTURED ASSET MORTGAGE
                                        INVESTMENTS II INC.

                                        By:_____________________________
                                        Name:    Baron Silverstein
                                        Title:   Vice President

                                      J-23

<PAGE>

                                    EXHIBIT 1
                                    ---------
                            CONTENTS OF MORTGAGE FILE
                            -------------------------

         With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Purchaser or its designee, and which shall be delivered to the Purchaser or its
designee pursuant to the terms of the Agreement.

         (a) with respect to each Mortgage Loan (other than a Cooperative Loan):

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

                  (ii) The original Mortgage and, if the related Mortgage Loan
         is a MOM Loan, noting the presence of the MIN and language indicating
         that such Mortgage Loan is a MOM Loan, which shall have been recorded
         (or if the original is not available, a copy), with evidence of such
         recording indicated thereon (or if the original is not available, a
         copy), with evidence of such recording indicated thereon (or if the
         original Security Instrument, assignments to the Trustee or intervening
         assignments thereof which have been delivered, are being delivered or
         will, upon receipt of recording information relating to the Security
         Instrument required to be included thereon, be delivered to recording
         offices for recording and have not been returned to the Seller in time
         to permit their recording as specified in Section 2.01(b) of the
         Pooling and Servicing Agreement, shall be in recordable form);

                  (iii) unless the Mortgage Loan is a MOM Loan, a certified copy
         of the assignment (which may be in the form of a blanket assignment if
         permitted in the jurisdiction in which the Mortgaged Property is
         located) to "U.S. Bank National Association, as Trustee", with evidence
         of recording with respect to each Mortgage Loan in the name of the
         Trustee thereon (or if (A) the original Security Instrument,
         assignments to the Trustee or intervening assignments thereof which
         have been delivered, are being delivered or will, upon receipt of
         recording information relating to the Security Instrument required to
         be included thereon, be delivered to recording offices for recording
         and have not been returned to the Seller in time to permit their
         delivery as specified in Section 2.01(b) of the Pooling and Servicing
         Agreement, the Seller may deliver a true copy thereof with a
         certification by the Seller, on the face of such copy, substantially as
         follows: "Certified to be a true and correct copy of the original,
         which has been transmitted for recording" or (B) the related Mortgaged
         Property is located in a state other than Maryland and an Opinion of
         Counsel has been provided as set forth in Section 2.01(b) of the
         Pooling and Servicing Agreement, shall be in recordable form);

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

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

                                      J-24

<PAGE>

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

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

         (b) with respect to each Cooperative Loan so assigned:

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

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

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

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

                  (v) The Security Agreement;

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

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

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

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

                                      J-25

<PAGE>

                                    EXHIBIT 2
                                    ---------

                       MORTGAGE LOAN SCHEDULE INFORMATION
                       ----------------------------------

         The Preliminary and Final Mortgage Loan Schedules shall set forth the
following information with respect to each Mortgage Loan:

(a) the loan number;

(b) the Mortgagor's name;

(c) the city, state and zip code of the Mortgaged Property;

(d) the property type;

(e) the Mortgage Interest Rate;

(f) the Servicing Rate;

(g) the Net Rate;

(h) the original term;

(i) the maturity date;

(j) the stated remaining term to maturity;

(k) the original principal balance;

(1) the first payment date;

(m) the principal and interest payment in effect as of the Cut-off Date;

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

(o) the Loan-to-Value Ratio at origination;

(p) paid-through date;

(q) the insurer of any Primary Mortgage Insurance Policy;

(r) the Gross Margin, if applicable;

(s) the Maximum Lifetime Mortgage Rate, if applicable;

(t) the Minimum Lifetime Mortgage Rate, if applicable;

                                      J-26

<PAGE>

(u) the Periodic Rate Cap, if applicable;

(v) the number of days delinquent, if any;

(w) which Mortgage Loans adjust after an initial fixed-rate period of three,
    five, seven or ten years;

(x) the Loan Group;

(y) the Prepayment Charge Loans; and

(z) the Servicer.

Such schedule also shall set forth for all of the Mortgage Loans, the total
number of Mortgage Loans, the total of each of the amounts described under (k)
and (n) above, the weighted average by principal balance as of the Cut-off Date
of each of the rates described under (e), (f) and (g) above, and the weighted
average remaining term to maturity by unpaid principal balance as of the Cut-off
Date.

                                      J-27

<PAGE>

                                    EXHIBIT 3
                                    ---------

                       MORTGAGE LOAN SELLER'S INFORMATION
                       ----------------------------------

         All information in the Prospectus Supplement described under the
following Sections: "SUMMARY OF PROSPECTUS SUPPLEMENT -- The Mortgage Loans,"
"THE MORTGAGE POOL" and "SCHEDULE A -- CERTAIN CHARACTERISTICS OF THE MORTGAGE
LOANS."

                                      J-28

<PAGE>

                                    EXHIBIT 4
                                    ---------

                             PURCHASER'S INFORMATION
                             -----------------------

         All information in the Prospectus Supplement and the Prospectus, except
the Mortgage Loan Seller's Information.

                                      J-29

<PAGE>

                                    EXHIBIT 5
                                    ---------

                             SCHEDULE OF LOST NOTES
                             ----------------------

                             Available Upon Request

                                      J-30

<PAGE>

                                   SCHEDULE A
                                   ----------

                 REQUIRED RATINGS FOR EACH CLASS OF CERTIFICATES
                 -----------------------------------------------

                               Public Certificates
                               -------------------

                 Class                            S&P                 Moody's
                 -----                            ---                 -------

Class A-1..............................           AAA                   Aaa
Class A-2..............................           AAA                   Aaa
Class A-3..............................           AAA                   Aaa
Class A-4..............................           AAA                   Aaa
Class A-5..............................           AAA                   Aaa
Class A-6..............................           AAA                   Aaa
Class A-7..............................           AAA                   Aaa
Class A-8..............................           AAA                   Aaa
Class A-9..............................           AAA                   Aaa
Class PO...............................           AAA                   Aaa
Class R-I..............................           AAA                   NR
Class R-II.............................           AAA                   NR
Class R-III............................           AAA                   NR
Class B-1..............................           AA                    NR
Class B-2..............................            A                    NR
Class B-3..............................           BBB                   NR

None of the above ratings has been lowered since the respective dates of such
letters.

                              Private Certificates
                              --------------------

                 Class                            S&P                 Moody's
                 -----                            ---                 -------
Class B-4..............................           BB                    NR
Class B-5..............................            B                    NR
Class B-6..............................           NR                    NR

None of the above ratings has been lowered since the respective dates of such
letters.

                                      J-31

<PAGE>

                                   SCHEDULE B
                                   ----------

                             MORTGAGE LOAN SCHEDULE
                             ----------------------

                             [Provided upon request]

                                      J-32================================================================================

                          ABN AMRO MORTGAGE CORPORATION

                                    Depositor

                                       and

                   WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.

                               Seller and Servicer

                                       and

                         U.S. BANK NATIONAL ASSOCIATION

                              Trustee and Custodian

                         POOLING AND SERVICING AGREEMENT

                          Dated as of December 1, 2003

                                  $354,678,057

                       Mortgage Pass-Through Certificates

                                 SERIES 2003-13

================================================================================

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                                        <C>
                                    ARTICLE I

                                   DEFINITIONS

                                   ARTICLE II

                            CONVEYANCE OF TRUST FUND;
                        ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.1   Conveyance of Trust Fund ................................................................    33
Section 2.2   Acceptance by Custodian .................................................................    36
Section 2.3   Representations and Warranties of the Depositor with respect to the Loans ...............    39
Section 2.4   Authentication and Delivery of Certificates; Designation of Certificates as REMIC Regular
                and Residual Interests ................................................................    43
Section 2.5   Designation of Startup Day ..............................................................    43
Section 2.6   No Contributions ........................................................................    43
Section 2.7   Representations and Warranties of the Servicer ..........................................    43

                                   ARTICLE III

                      ADMINISTRATION AND SERVICING OF LOANS
Section 3.1   Servicer to Act as Servicer; Administration of the Loans ................................    45
Section 3.2   Collection of Certain Loan Payments; Custodial Account for P&I ..........................    48
Section 3.3   Permitted Withdrawals from the Custodial Account for P&I ................................    50
Section 3.4   Taxes, Assessments and Similar Items; Escrow Accounts ...................................    52
Section 3.5   Maintenance of Insurance ................................................................    53
Section 3.6   Enforcement of Due-on-Sale Clauses; Assumption and Substitution Agreements ..............    54
Section 3.7   Realization upon Defaulted Loans ........................................................    55
Section 3.8   Trustee to Cooperate; Release of Mortgage Files .........................................    57
Section 3.9   Servicing Compensation ..................................................................    58
Section 3.10  Reports to the Trustee ..................................................................    58
Section 3.11  Annual Statement as to Compliance .......................................................    59
Section 3.12  Annual Independent Public Accountants' Servicing Report .................................    59
Section 3.13  Access to Certain Documentation and Information Regarding the Loans .....................    60
Section 3.14  [Reserved] ..............................................................................    60
Section 3.15  Sale of Defaulted Loans and REO Properties ..............................................    60
Section 3.16  Delegation of Duties ....................................................................    61
Section 3.17  [Reserved] ..............................................................................    62
</TABLE>

                                       i
<PAGE>

<TABLE>
<S>                                                                                                        <C>
Section 3.18  [Reserved] ..............................................................................    62
Section 3.19  Appointment of a Special Servicer .......................................................    62
Section 3.20  Allocation of Realized Losses ...........................................................    62

                                   ARTICLE IV

                    PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
                             STATEMENTS AND REPORTS
Section 4.1   Distributions to Certificateholders .....................................................    64
Section 4.2   Statements to Certificateholders ........................................................    65
Section 4.3   Advances by the Servicer; Distribution Reports to the Trustee ...........................    67
Section 4.4   Nonrecoverable Advances .................................................................    68
Section 4.5   Foreclosure Reports .....................................................................    69
Section 4.6   Adjustment of Servicing Fees with Respect to Payoffs ....................................    69
Section 4.7   Prohibited Transactions Taxes and Other Taxes ...........................................    69
Section 4.8   Tax Administration ......................................................................    70
Section 4.9   Equal Status of Servicing Fee ...........................................................    70
Section 4.10  Appointment of Paying Agent .............................................................    70

                                    ARTICLE V

                                THE CERTIFICATES
Section 5.1   The Certificates ........................................................................    71
Section 5.2   Certificates Issuable in Classes; Distributions of Principal and Interest; Authorized
                Denominations .........................................................................    78
Section 5.3   Registration of Transfer and Exchange of Certificates ...................................    78
Section 5.4   Mutilated, Destroyed, Lost or Stolen Certificates .......................................    79
Section 5.5   Persons Deemed Owners ...................................................................    80
Section 5.6   Temporary Certificates ..................................................................    80
Section 5.7   Book-Entry for Book-Entry Certificates ..................................................    80
Section 5.8   Notices to Clearing Agency ..............................................................    81
Section 5.9   Definitive Certificates .................................................................    82
Section 5.10  Office for Transfer of Certificates .....................................................    82

                                   ARTICLE VI

                         THE DEPOSITOR AND THE SERVICER
Section 6.1   Liability of the Depositor and the Servicer .............................................    83
Section 6.2   Merger or Consolidation of the Depositor or the Servicer ................................    83
Section 6.3   Limitation on Liability of the Servicer and Others ......................................    83
Section 6.4   Servicer Not to Resign ..................................................................    84
</TABLE>

                                       ii
<PAGE>

<TABLE>
<S>                                                                                                       <C>
Section 6.5   Trustee Access ..........................................................................    84

                                   ARTICLE VII

                                     DEFAULT
Section 7.1   Events of Default .......................................................................    85
Section 7.2   Other Remedies of Trustee ...............................................................    87
Section 7.3   Directions by Certificateholders and Duties of Trustee During Event of Default ..........    87
Section 7.4   Action upon Certain Failures of Servicer and upon Event of Default ......................    87
Section 7.5   Appointment of Successor Servicer .......................................................    88
Section 7.6   Notification to Certificateholders ......................................................    89

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE
Section 8.1   Duties of Trustee .......................................................................    90
Section 8.2   Certain Matters Affecting Trustee. Except as otherwise provided in Section 8.1 ..........    92
Section 8.3   Trustee Not Required to Make Investigation ..............................................    93
Section 8.4   Trustee Not Liable for Certificates or Loans ............................................    93
Section 8.5   Trustee May Own Certificates ............................................................    94
Section 8.6   Servicer to Pay Trustee's Fees and Expenses .............................................    94
Section 8.7   Eligibility Requirements for Trustee ....................................................    95
Section 8.8   Resignation and Removal of Trustee ......................................................    95
Section 8.9   Successor Trustee .......................................................................    96
Section 8.10  Merger or Consolidation of Trustee ......................................................    96
Section 8.11  Appointment of Co-Trustee or Separate Trustee ...........................................    97
Section 8.12  Authenticating Agent ....................................................................    98
Section 8.13  Bloomberg ...............................................................................    99
Section 8.14  The Custodian ...........................................................................    99

                                   ARTICLE IX

                                   TERMINATION
Section 9.1   Termination upon Purchase by the Servicer or Liquidation of All Loans ...................   100
Section 9.2   Trusts Irrevocable ......................................................................   101
Section 9.3   Additional Termination Requirements .....................................................   101
</TABLE>

                                      iii
<PAGE>

<TABLE>
<S>                                                                                                       <C>
                                    ARTICLE X

                            MISCELLANEOUS PROVISIONS
Section 10.1  Amendment ...............................................................................   103
Section 10.2  Recordation of Agreement ................................................................   104
Section 10.3  Limitation on Rights of Certificateholders ..............................................   104
Section 10.4  Governing Law; Jurisdiction .............................................................   105
Section 10.5  Notices .................................................................................   105
Section 10.6  Severability of Provisions ..............................................................   106
</TABLE>

                                       iv
<PAGE>

EXHIBITS

Exhibit A     -   Forms of Certificates
Exhibit B     -   Form of Residual Certificate
Exhibit C-1   -   Form of Custodian's Initial Certification
Exhibit C-2   -   Form of Custodian's Interim Certification
Exhibit C-3   -   Form of Final Certification
Exhibit D     -   Schedule of Loans
Exhibit E     -   Fields of Loan Information
Exhibit F     -   Form of Transferor Certificate for Privately Offered
                  Certificates
Exhibit G     -   Form of Transferee's Certificate for Privately Offered
                  Certificates
Exhibit H     -   [Reserved]
Exhibit I     -   Form of Transferor Certificate
Exhibit J     -   Form of Transferee Affidavit and Agreement
Exhibit K     -   Form of Additional Matter Incorporated into the Form of the
                  Certificates
Exhibit L     -   Form of Rule 144A Investment Representation
Exhibit M     -   Scheduled Principal Balance
Exhibit N     -   [Reserved]
Exhibit O     -   [Reserved]
Exhibit P     -   [Reserved]
Exhibit Q     -   Bloomberg Data
Exhibit R     -   Form of Special Servicing Agreement
Exhibit S     -   Form of Form 10-K Certificate
Exhibit T     -   Form of Back-up Certification to Form 10-K Certificate

                                        v
<PAGE>

      This Pooling and Servicing Agreement, dated and effective as of December
1, 2003 (this "Agreement"), is executed by and among ABN AMRO Mortgage
Corporation, as depositor (the "Depositor"), Washington Mutual Mortgage
Securities Corp., as seller and servicer (the "Servicer"), and U.S. Bank
National Association, as trustee (the "Trustee"). Capitalized terms used in this
Agreement and not otherwise defined have the meanings ascribed to such terms in
Article I hereof.

                              PRELIMINARY STATEMENT

      The Depositor at the Closing Date is the owner of the Loans and the other
property being conveyed by it to the Trustee for inclusion in the Trust Fund. On
the Closing Date, the Depositor will acquire the Certificates from the Trust
Fund as consideration for its transfer to the Trust Fund of the Loans and
certain other assets and will be the owner of the Certificates. The Depositor
has duly authorized the execution and delivery of this Agreement to provide for
the conveyance to the Trustee of the Loans and the issuance to the Depositor of
the Certificates representing in the aggregate the entire beneficial ownership
of the Trust Fund. All covenants and agreements made by the Depositor, the
Servicer and the Trustee herein with respect to the Loans and the other property
constituting the Trust Fund are for the benefit of the Holders from time to time
of the Certificates. The Depositor and the Servicer are entering into this
Agreement, and the Trustee is accepting the trust created hereby, for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged.

      The Certificates issued hereunder, other than the Class B-3, Class B-4 and
Class B-5 Certificates have been offered for sale pursuant to a Prospectus,
dated January 23, 2003, and a Prospectus Supplement, dated December 22, 2003 of
the Depositor (together, the "Prospectus"). The Class B-3, Class B-4 and Class
B-5 Certificates have been offered for sale pursuant to a Private Placement
Memorandum dated December 23, 2003. The Trust Fund created hereunder is intended
to be the "Trust" as described in the Prospectus and the Private Placement
Memorandum and the Certificates are intended to be the "Certificates" described
therein.

      As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the Loans and other related assets in the Trust Fund
subject to this Agreement as a REMIC for federal income tax purposes, and such
segregated pool of assets will be designated as "REMIC I." Component R-1 of the
Class R Certificate will represent the sole class of "residual interests" in
REMIC I for purposes of the REMIC Provisions under federal income tax law.

      As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC I Regular Interests as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated as "REMIC
II." Component R-2 of the Class R Certificate will represent the sole class of
"residual interests" in REMIC II for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designations, the Remittance Rate and initial Class Principal Balance or
Notional Balance for each Class of Certificates which, together with the Class
R-2 Component, constitute the entire beneficial interests in REMIC II.
Determined solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the REMIC I
Regular Interests and for each Class of Certificates shall be the first
Distribution Date that is at least two years after the

<PAGE>

end of the remaining amortization schedule of the Loan in the Mortgage Pool that
has, as of the Closing Date, the longest remaining amortization schedule,
irrespective of its scheduled maturity. The following table sets forth the
designation, Remittance Rate, initial Class Principal Balance, and Last
Scheduled Distribution Date for each Class of Certificates comprising the
beneficial interests in REMIC II and the Class R Certificate:

<TABLE>
<CAPTION>
                                         Initial Class Principal or     Last Scheduled Distribution
Designation      Remittance Rate(1)           Notional Balance                     Date*
-----------      ------------------      --------------------------     --------------------------
<S>                   <C>                     <C>                            <C>
Class A-1             5.50%(2)                $ 40,000,000.00                 January 25, 2034
Class A-2             5.50%(3)                $ 28,373,000.00                February 25, 2018
Class A-3             5.50%(3)                $ 24,249,000.00                 January 25, 2034
Class A-4             5.50%(4)                $ 29,323,850.00                 January 25, 2034
Class A-5             5.50%(2)                $  2,210,139.00                 January 25, 2034
Class A-6             5.50%                   $207,487,020.00                 January 25, 2034
Class A-7             5.50%(4)                $  4,878,279.00                 January 25, 2034
Class A-8             5.25%                   $  5,000,000.00                 January 25, 2034
Class A-9                  (5)                $    500,000.00                 January 25, 2034
Class A-10                 (6)                $    500,000.00                 January 25, 2034
Class A-X             5.50%(7)                $    236,623.75                 January 25, 2034
Class A-P             0.00%(8)                $  2,193,666.68                 January 25, 2034
Class M               5.50%                   $  5,497,510.00                 January 25, 2034
Class B-1             5.50%                   $  2,128,068.00                 January 25, 2034
Class B-2             5.50%                   $  1,064,034.00                 January 25, 2034
Class B-3             5.50%                   $    709,356.00                 January 25, 2034
Class B-4             5.50%                   $    532,017.00                 January 25, 2034
Class B-5             5.50%                   $    532,018.07                 January 25, 2034
Class R+              5.50%                   $        100.00(9)              January 25, 2034
</TABLE>

----------
*     The Distribution Date in the month after the maturity date for the latest
      maturing Loan, except in the case of the Class A-2 Certificates.

+     The Class R Certificate is entitled to receive the Residual Distribution
      Amount and Excess Liquidation Proceeds.

(1)   Interest distributed to the Certificates (other than the Principal Only
      Certificates) on each Distribution Date will have accrued during the
      related Interest Accrual Period (as defined herein) at the applicable per
      annum Remittance Rate.

(2)   On each Distribution Date prior to the Class A-5 Accretion Termination
      Date (as defined herein), an amount equal to the Class A-5 Accrual Amount
      (as defined herein) will be added to the Class A-5 Class Principal
      Balance and such amount will be distributed as principal to the Class A-1
      Certificates and Class A-5 Certificates as described herein and will not
      be distributed as interest to the Class A-5 Certificates.

(3)   On each Distribution Date prior to the Class A-3 Accretion Termination
      Date (as defined herein), an amount equal to the Class A-3 Accrual Amount
      (as defined herein) will be added to the Class A-3 Class Principal

                                       2
<PAGE>

      Balance and such amount will be distributed as principal to the Class A-2
      Certificates as described herein and will not be distributed as interest
      to the Class A-3 Certificates.

(4)   The Class A-4 Certificates and Class A-7 Certificates will generally not
      be entitled to receive any distributions of principal, Principal
      Prepayments or Liquidation Proceeds until the Distribution Date in January
      2009.

(5)   Interest will accrue on the Class A-9 Certificates at a fixed rate equal
      to 1.55% per annum and after the first Distribution Date at a rate per
      annum of LIBOR plus 0.45%, determined monthly as described herein, subject
      to a maximum rate of 8.00% and a minimum rate of 0.45%.

(6)   Interest will accrue on the Class A-10 Certificates at a fixed rate equal
      to 6.45% per annum and after the first Distribution Date at a rate per
      annum of 7.55% minus LIBOR, determined monthly as described herein,
      subject to a maximum rate of 7.55% and a minimum rate of 0.00%.

(7)   The Class A-X Certificates will accrue interest on the Class A-X Notional
      Amount (as defined herein).

(8)   The Class A-P Certificates will not be entitled to distributions of
      interest and will receive principal only in respect of the Loans with
      Pass-Through Rates that are less than 5.50% per annum.

(9)   The Class R Certificate will be comprised of two components, component
      R-1, which represents the sole residual interest in REMIC I (as defined
      herein), and component R-2, which represents the sole residual interest in
      REMIC II (as defined herein).

                                       3
<PAGE>

                               W I T N E S S E T H

      In consideration of the mutual agreements herein contained, the Depositor,
the Servicer and the Trustee agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

      Whenever used herein, the following words and phrases, unless the context
otherwise requires, shall have the meanings specified in this Article:

      Accretion Directed Certificates: The Class A-1 Certificates and Class A-2
Certificates.

      Accrual Certificates: The Class A-3 Certificates and Class A-5
Certificates.

      Adjustable Rate Certificates: The Class A-9 Certificates and Class A-10
Certificates.

      Advance: An Advance made by the Servicer pursuant to Section 4.3.

      Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. The Trustee may obtain
and rely on an Officer's Certificate of the Servicer or the Depositor to
determine whether any Person is an Affiliate of such party.

      Aggregate Certificate Principal Balance: At any given time, the sum of the
then current Class Principal Balances of all Classes of Certificates.

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

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

      Anniversary: Each anniversary of the Cut-off Date.

      Appraised Value: The amount set forth in an appraisal made by or for the
mortgage originator in connection with its origination of each Loan.

      Assignment: An assignment of the Mortgage, notice of transfer or
equivalent instrument, in recordable form, sufficient under the laws of the
jurisdiction where the related Mortgaged Property

                                       4
<PAGE>

is located to reflect of record the sale and assignment of the Loan to the
Trustee, which assignment, notice of transfer or equivalent instrument may, if
permitted by law, be in the form of one or more blanket assignments covering
Mortgages secured by Mortgaged Properties located in the same county.

      Authenticating Agent: Any authenticating agent appointed by the Trustee
pursuant to Section 8.12.

      Authorized Denomination: With respect to the Senior Certificates (other
than the Class A-10, Class A-X and Class R Certificate) and the Senior
Subordinate Certificates, an initial Certificate Principal Balance equal to
$25,000 each and integral multiples of $1 in excess thereof. With respect to the
Class A-10 Certificates, an initial Class Notional Amount equal to $500,000 each
and integral multiples of $1 in excess thereof. With respect to the Class A-X
Certificates, an initial Class Notional Amount equal to $100,000 each and
integral multiples of $1 in excess thereof. With respect to the Class R
Certificate, one Certificate with a Percentage Interest equal to 100%. With
respect to the Junior Subordinate Certificates, an Initial Certificate Principal
Balance equal to $100,000 each and integral multiples of $1 in excess thereof,
except with respect to the Class B-5 Certificates, which may be issued in a
different amount that is not a multiple of $1.

      Available Distribution Amount: For any Distribution Date, the sum of the
following amounts:

            (1) the total amount of all cash received by or on behalf of the
      Servicer with respect to the Loans by the Determination Date for such
      Distribution Date and not previously distributed (including Liquidation
      Proceeds and Insurance Proceeds), except:

                  (a) all Prepaid Monthly Payments;

                  (b) all Curtailments received after the applicable Prepayment
            Period (together with any interest payment received with such
            prepayments to the extent that it represents the payment of interest
            accrued on a related Loan subsequent to the applicable Prepayment
            Period);

                  (c) all Payoffs received after the Payoff Period immediately
            preceding such Distribution Date (together with any interest payment
            received with such Payoffs to the extent that it represents the
            payment of interest accrued on such Loan for the period subsequent
            to the calendar month preceding such Distribution Date);

                  (d) all interest payments received on Payoffs received on or
            after the first calendar day through and including the 14th calendar
            day of the month of such Distribution Date, which interest shall not
            be included in the calculation of Available Distribution Amount for
            any Distribution Date;

                                       5
<PAGE>

                  (e) Insurance Proceeds and Liquidation Proceeds on such Loans
            received after the applicable Prepayment Period;

                  (f) all amounts in the Custodial Account for P & I which are
            due and reimbursable to the Servicer pursuant to the terms of this
            Agreement;

                  (g) the Servicing Fee for each such Loan; and

                  (h) Excess Liquidation Proceeds;

            (2) to the extent advanced by the Servicer and not previously
      distributed, the amount of any Advance made by the Servicer to the Trustee
      with respect to such Distribution Date;

            (3) to the extent advanced by the Servicer and not previously
      distributed, any amount payable as Compensating Interest by the Servicer
      on such Distribution Date; and

            (4) the total amount, to the extent not previously distributed, of
      all cash received by the Distribution Date by the Trustee or the Servicer,
      in respect of a Purchase Obligation under Section 2.2 and Section 2.3 or
      any permitted repurchase of a Loan.

      Bankruptcy Coverage: As of the Cut-Off Date, $50,000, and thereafter, the
initial Bankruptcy Coverage, amount less (a) any scheduled or permissible
reduction in the amount of Bankruptcy Coverage pursuant to this definition and
(b) Bankruptcy Losses allocated to the Certificates. The Bankruptcy Coverage may
be reduced upon written confirmation from each Rating Agency that such reduction
will not adversely affect the then current ratings assigned to the Certificates
by each Rating Agency.

      Bankruptcy Loss: A loss on a Loan arising out of (i) a reduction in the
scheduled Monthly Payment for such Loan by a court of competent jurisdiction in
a case under the United States Bankruptcy Code, other than any such reduction
that arises out of clause (ii) of this definition of "Bankruptcy Loss,"
including, without limitation, any such reduction that results in a permanent
forgiveness of principal, or (ii) with respect to any Loan, a valuation, by a
court of competent jurisdiction in a case under such Bankruptcy Code, of the
related Mortgaged Property in an amount less than the then outstanding Principal
Balance of such Loan.

      Beneficial Holder: A Person holding a beneficial interest in any
Book-Entry Certificate as or through a DTC Participant or an Indirect DTC
Participant or a Person holding a beneficial interest in any Definitive
Certificate.

      Book-Entry Certificates: The Class A Certificates, the Class M
Certificates, the Class B-1 Certificates and the Class B-2 Certificates
beneficial ownership and transfers of which shall be made through book entries
as described in Section 5.7.

                                       6
<PAGE>

      Business Day: Any day other than a Saturday, a Sunday, or a day on which
banking institutions in Chicago, Illinois, Boston, Massachusetts, New York, New
York, St. Paul, Minnesota or the state in which the office of the Servicer is
located, are authorized or obligated by law or executive order to be closed.

      Certificate: Any one of the Certificates issued pursuant to this
Agreement, executed by the Trustee and authenticated by or on behalf of the
Trustee hereunder in substantially one of the forms set forth in Exhibits A and
B hereto. The additional matter appearing in Exhibit K shall be deemed
incorporated into Exhibits A and B as though set forth at the end of Exhibit A
and at the end of Exhibit B, as applicable.

      Certificate Account: The separate trust account created and maintained
with the Trustee or any other bank or trust company acceptable to each Rating
Agency which is incorporated or organized under the laws of the United States or
any state thereof, which account shall bear a designation clearly indicating
that the funds deposited therein are held in trust for the benefit of the
Trustee on behalf of the Certificateholders or any other account serving a
similar function acceptable to each Rating Agency. Funds in the Certificate
Account in respect of the Loans and amounts withdrawn from the Certificate
Account attributable to the Loans shall be accounted for separately. Funds on
deposit in the Certificate Account may be invested in Eligible Investments and
reinvestment earnings thereon shall be paid to the Servicer as additional
compensation. Funds deposited in the Certificate Account (exclusive of the
Servicing Fee) shall be held in trust for the Certificateholders and for the
uses and purposes set forth in Section 3.2, Section 3.3 and Section 4.1.

      Certificate Distribution Amount: (I) For any Distribution Date prior to
the Credit Support Depletion Date, the Available Distribution Amount shall be
distributed to the Certificates in the following amounts and priority:

      (a) with respect to the Senior Certificates:

            (i) first, to the Class A-P Certificates, the sum of the Discount
      Fractional Principal Amounts for such Distribution Date;

            (ii) second, to the Senior Certificates entitled to receive
      interest, previously unpaid and then current Interest Distribution
      Amounts; provided, however, that interest accrued on the Class A-3
      Certificates and Class A-5 Certificates shall be distributed in the
      following manner:

                  (a)   with respect to the Class A-1 Certificates and Class A-5
                        Certificates, until the Class A-5 Accretion Termination
                        Date, the Class A-5 Accrual Amount shall be payable as
                        principal in the following manner and order of priority:

                                       7
<PAGE>

                              (i) first, to the Class A-1 Certificates, if the
                        aggregate principal balance of the Loans as of the
                        related Due Date (after taking into account any
                        reductions in the principal balance of the Loans on such
                        Due Date and any reductions by any Payoff received until
                        and including the 14th day of the month of such
                        Distribution Date) is greater than the Scheduled
                        Principal Balance set forth in Exhibit M for such
                        Distribution Date, until the Class Principal Balance
                        thereof has been reduced to zero; and

                              (ii) second, to the Class A-5 Certificates, until
                        the Class Principal Balance thereof has been reduced to
                        zero; and

                  (b)   with respect to the Class A-2 Certificates and Class A-3
                        Certificates, until the Class A-2 Accretion Termination
                        Date, the Class A-3 Accrual Amount shall be payable as
                        principal to the Class A-2 Certificates until the Class
                        Principal Balance of the Class A-2 Certificates has been
                        reduced to zero;

            (iii) third, the Senior Principal Amount to the Senior Certificates
      then entitled to principal (other than the Class A-P Certificates), in the
      following manner and order of priority:

                  (a)   first, to the Class R Certificate, until its Class
                        Principal Balance has been reduced to zero;

                  (b)   second, to the Class A-4 Certificates and Class A-7
                        Certificates, pro rata, up to the Lockout Principal
                        Amount for such Distribution Date, until their
                        respective Class Principal Balances have been reduced to
                        zero;

                  (c)   third, concurrently as follows:

                              (i) 16.5402072521% of the Senior Principal Amount
                        distributable under clause (iii)(c) shall be distributed
                        in the following manner and order of priority:

                                    (a) first, if the aggregate principal
                              balance of the Loans as of the related Due Date
                              (after taking into account any reductions in the
                              principal balance of the Loans on such Due Date
                              and any reductions by any Payoff received until
                              and including the 14th day of the month of such
                              Distribution Date) is greater than the Scheduled
                              Principal Balance set forth in Exhibit M for such
                              Distribution Date, to the Class A-1

                                       8
<PAGE>

                              Certificates, until the Class Principal Balance
                              thereof has been reduced to zero;

                                    (b) second, to the Class A-5 Certificates,
                              until the Class Principal Balance thereof has been
                              reduced to zero; and

                                    (c) third, to the Class A-1 Certificates,
                              until the Class Principal Balance thereof has been
                              reduced to zero; and

                              (i) 83.4597927479% of the Senior Principal Amount
                        distributable under clause (iii)(c) shall be distributed
                        to the Class A-6, Class A-8 and Class A-9 Certificates,
                        pro rata, until their respective Class Principal
                        Balances have been reduced to zero;

                  (d)   fourth, to the Class A-2 Certificates, until its Class
                        Principal Balance has been reduced to zero;

                  (e)   fifth, to the Class A-3 Certificates, until its Class
                        Principal Balance has been reduced to zero;

                  (f)   sixth, to the Class A-4 Certificates and Class A-7
                        Certificates, pro rata, until their respective Class
                        Principal Balances have been reduced to zero;

            (iv) fourth, to the Class A-P Certificates, up to the Subordinate
      Principal Amount (determined without regard to the proviso of such
      definition) for such Distribution Date, the sum of the Discount Fractional
      Principal Shortfalls payable to the Class A-P Certificates on previous
      Distribution Dates pursuant to clause (I)(a)(v) of this definition of
      "Certificate Distribution Amount" and remaining unpaid from such previous
      Distribution Dates; and

            (v) fifth, to the Class A-P Certificates, up to the Subordinate
      Principal Amount (determined without regard to the proviso of such
      definition) for such Distribution Date (less any amounts distributed to
      the Class A-P Certificates pursuant to paragraph (I)(a)(iv)), the sum of
      the Discount Fractional Principal Shortfalls for such Distribution Date;
      provided that any amounts distributed in respect of the Discount
      Fractional Principal Shortfall pursuant to paragraph (I)(a)(iv) or this
      paragraph (I)(a)(v) of this definition of "Certificate Distribution
      Amount" shall not cause a further reduction of the Class A-P Class
      Principal Balance.

      (b)   with respect to the Senior Certificates and Subordinate
            Certificates, on any Distribution Date prior to the Credit Support
            Depletion Date, to the extent of the Available Distribution Amount
            remaining:

                                       9
<PAGE>

            (i) first, to the Class M, Class B-1, Class B-2, Class B-3, Class
      B-4 and Class B-5 Certificates, in their order of seniority, the
      following:

                  (a)   their respective amounts of previously unpaid and then
                        current Interest Distribution Amounts;

                  (b)   their pro rata share, according to their respective
                        Class Principal Balances, of the applicable Subordinate
                        Principal Amount allocable pursuant to the definition of
                        "Subordinate Principal Amount" herein, until their Class
                        Principal Balances have been reduced to zero;

            (ii) second, to the Senior Certificates and Subordinate Certificates
      in their order of seniority, the amount of unreimbursed Realized Losses
      previously allocated to such Class, if any, provided, that any amounts
      distributed in respect of losses pursuant to this paragraph (I)(B)(ii) of
      this definition of "Certificate Distribution Amount" shall not cause a
      further reduction in the Class Principal Balances of the Senior
      Certificates or Subordinate Certificates; and

            (iii) third, to the Class R Certificate, the Residual Distribution
      Amount;

      (II) for any Distribution Date on or after the Credit Support Depletion
Date, the Available Distribution Amount remaining, shall be distributed to the
outstanding Senior Certificates in the following amounts and priority:

      (a) first, to the Class A-P Certificates, the sum of the Discount
Fractional Principal Amounts for such Distribution Date;

      (b) second, to the Senior Certificates then entitled to interest
previously unpaid and then current Interest Distribution Amounts, pro rata,
according to such amount payable to the extent of amounts available;

      (c) third, to the Senior Certificates (other than the Interest Only
Certificates and Class A-P Certificates), the Senior Principal Amount, pro rata,
according to their respective Class Principal Balances;

      (d) fourth, to the Senior Certificates, pro rata, according to their
respective Class Principal Balances, the amount of unreimbursed Realized Losses
previously allocated to each such Class; and

      (e) fifth, to the Class R Certificate, the Residual Distribution Amount
for such Distribution Date.

                                       10
<PAGE>

      Certificate Principal Balance: For each Certificate of any Class, the
portion of the related Class Principal Balance, if any, represented by such
Certificate.

      Certificate Register and Certificate Registrar: The register maintained
and the registrar appointed, respectively, pursuant to Section 5.3. Initially,
the Certificate Registrar shall be the Trustee.

      Certificateholder or Holder: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purposes of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor, the Servicer or any Affiliate thereof shall be deemed not
to be outstanding and the Percentage Interest evidenced thereby shall not be
taken into account in determining whether the requisite percentage of Percentage
Interests necessary to effect any such consent has been obtained; provided, that
the Trustee, the Certificate Registrar and the Paying Agent may conclusively
rely upon an Officer's Certificate to determine whether any Person is an
Affiliate of the Depositor or the Servicer.

      Certificateholders' Report: As defined in Section 4.2(a).

      Class: All Certificates having the same priority and rights to payments
from the Available Distribution Amount, designated as a separate Class, as set
forth in the forms of Certificates attached hereto as Exhibits A and B.

      Class A Certificates: The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7, Class A-8, Class A-9, Class A-10, Class A-X and
Class A-P Certificates, collectively, and designated as such on the face thereof
in substantially the form attached hereto as Exhibit A-1.

      Class A-3 Accretion Termination Date: The Distribution Date on which the
Class Principal Balance of the Class A-2 Certificates is reduced to zero.

      Class A-3 Accrual Amount: For any Distribution Date prior to the Class A-3
Accretion Termination Date, an amount equal to the accrued interest that would
otherwise be distributable in respect of the Class A-3 Certificates on such
Distribution Date and which will be added to the Class A-3 Class Principal
Balance.

      Class A-5 Accretion Termination Date: The earlier to occur of (i) the
Distribution Date on which the Class Principal Balance of the Class A-1
Certificates is reduced to zero and (ii) the Distribution Date on which the
Class Principal Balance of the Class A-5 Certificates is reduced to zero.

      Class A-5 Accrual Amount: For any Distribution Date prior to the Class A-5
Accretion Termination Date, an amount equal to the accrued interest that would
otherwise be distributable in respect of the Class A-5 Certificates on such
Distribution Date and which will be added to the Class A-5 Class Principal
Balance.

                                       11
<PAGE>

      Class A-9 Interest Rate: With respect to the initial Distribution Date,
1.55% per annum, and as to any Distribution Date thereafter, will be a per annum
rate equal to LIBOR plus 0.45% (subject to a maximum rate of 8.00% per annum and
a minimum rate of 0.45% per annum).

      Class A-10 Interest Rate: With respect to the initial Distribution Date,
6.45% per annum, and as to any Distribution Date thereafter, will be a per annum
rate equal to 7.55% minus LIBOR (subject to a maximum rate of 7.55% per annum
and a minimum rate of 0.00% per annum).

      Class A-10 Notional Amount: As of the Closing Date, $500,000 and
thereafter, with respect to any Distribution Date, will be equal to the Class
Principal Balance of the Class A-9 Certificates.

      Class A-X Notional Amount: As of the Closing Date $236,623.75, and
thereafter, with respect to any Distribution Date will equal the total Principal
Balance, as of the first day of the month preceding such Distribution Date
(after giving effect to all payments scheduled to be made on such Distribution
Date whether or not received and as reduced by any Payoff received until and
including the 14th day of such prior month), of the Premium Loans multiplied by
the following fraction:

              the weighted average of the Pass-Through Rates of the
           Premium Loans as of the first day of such month minus 5.50%
           -----------------------------------------------------------
                                      5.50%

      Class Notional Amount: With respect to the Class A-10 Certificates and
Class A-X Certificates, the Class A-10 Notional Amount and Class A-X Notional
Amount, respectively.

      Class Principal Balance: For any Class of Certificates (other than the
Interest Only Certificates), the applicable initial Class Principal Balance set
forth in the Preliminary Statement hereto, corresponding to the rights of such
Class in payments of principal due to be passed through to Certificateholders
from principal payments on the Loans, as reduced from time to time by (x)
distributions of principal to Certificateholders of such Class and (y) the
portion of Realized Losses allocated to the Class Principal Balance of such
Class pursuant to Section 3.20 with respect to a given Distribution Date. For
any Distribution Date, the reduction of the Class Principal Balance of any Class
of Certificates pursuant to Section 3.20 shall be deemed effective prior to the
determination and distribution of principal on such Class pursuant to the
definition of "Certificate Distribution Amount". Notwithstanding the foregoing,
the Class Principal Balance of the most subordinate Class of Certificates
outstanding at any time shall be equal to the aggregate Scheduled Principal
Balance of all of the Loans less the Class Principal Balance of all other
Classes of Certificates. The Class Principal Balance for the Class A-1
Certificates shall be referred to as the "Class A-1 Principal Balance", the
Class Principal Balance for the Class A-2 Certificates shall be referred to as
the "Class A-2 Principal Balance" and so on. The Class Principal Balances of the
Interest Only Certificates shall be zero.

      Class R Certificate: The Certificate designated as "Class R" on the face
thereof in substantially the form attached hereto as Exhibit B, that is composed
of Components R-1 and R-2

                                       12
<PAGE>

each of which has been designated as the sole class of "residual interests" in
REMIC I and REMIC II, respectively, pursuant to Section 2.1.

      Class R Certificateholder: The registered Holder of the Class R
Certificate.

      Clearing Agency: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities and Exchange Act of 1934, as amended,
which initially shall be DTC.

      Closing Date: December 23, 2003.

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

      Compensating Interest: For any Distribution Date, the lesser of (i) the
sum of (a) one-twelfth of 0.03% of the aggregate outstanding Principal Balance
of each Loan as of the second Due Date preceding such Distribution Date, (b) the
aggregate Payoff Earnings for such Distribution Date and (c) the aggregate
Payoff Interest for such Distribution Date and (ii) the aggregate Uncollected
Interest.

      Corporate Trust Office: The corporate trust office of the Trustee, at
which at any particular time its corporate trust business with respect to this
Agreement shall be administered, which office at the date of the execution of
this Agreement has an address of 1 Federal Street, 3rd Floor, Boston, MA 02110
Attention: Corporate Trust Services, ABN AMRO 2003-13.

      Credit Support Depletion Date: The first Distribution Date on which the
aggregate of the Class Principal Balances of the Subordinate Certificates has
been or will be reduced to zero as a result of principal distributions thereon
and the allocation of Realized Losses on such Distribution Date.

      Curtailment: Any payment of principal on a Loan, made by or on behalf of
the related Mortgagor, other than a Monthly Payment, a Prepaid Monthly Payment
or a Payoff, which is applied to reduce the outstanding Principal Balance of the
Loan.

      Curtailment Shortfall: With respect to any Curtailment applied with a
Monthly Payment, an amount equal to one month's interest on such Curtailment at
the applicable Pass-Through Rate on such Loan.

      Custodial Account for P&I: The custodial account for principal and
interest established and maintained by, or at the direction of, the Servicer and
caused by the Servicer to be established and maintained pursuant to Section
3.2(b) (i) with the corporate trust department of the Trustee or another
financial institution approved by the Servicer such that the rights of such
Servicer, the Trustee and the Certificateholders thereto shall be fully
protected against the claims of any creditors of the Servicer and of
any creditors or depositors of the institution in which such account is
maintained, (ii) within FDIC insured accounts (or other accounts with comparable
insurance

                                       13
<PAGE>

coverage acceptable to each Rating Agency) created and maintained, by or at the
direction of the Servicer, and monitored by the Servicer or (iii) in a separate
non-trust account without FDIC or other insurance in an Eligible Institution. In
the event that a Custodial Account for P&I is established pursuant to clause
(ii) of the preceding sentence, amounts held in such Custodial Account for P&I
shall not exceed the level of deposit insurance coverage on such account;
accordingly, more than one Custodial Account for P&I may be established.

      Custodian: A custodian which shall initially be U.S. Bank National
Association. Any Custodian so appointed shall act as agent on behalf of the
Trustee. The Trustee shall remain at all times responsible under the terms of
this Agreement, notwithstanding the fact that certain duties have been assigned
to the Custodian.

      Cut-Off Date: December 1, 2003.

      Data: As defined in Section 8.13.

      Defaulted Loan: As of any Determination Date, any Loan for which any
payment of principal of or interest on such Loan is more than 89 days past due,
determined without giving effect to any grace period permitted by the related
Mortgage or Mortgage Note or any other document in the Mortgage File.

      Definitive Certificates: As defined in Section 5.7.

      Denomination: The amount specified on a Certificate as representing the
aggregate Principal Balance of the Loans as of the Cut-Off Date evidenced by
such Certificate.

      Depositor: ABN AMRO Mortgage Corporation, a Delaware corporation, or its
successor-in-interest.

      Depository: DTC or any successor thereto.

      Depository Agreement: The Letter of Representations, dated December 23,
2003 by and among DTC, the Depositor and the Trustee.

      Determination Date: A day not later than the 10th day (or, if such 10th
day is not a Business Day, the Business Day immediately succeeding such 10th
day) preceding a related Distribution Date in the month in which such
Distribution Date occurs, as determined by the Servicer.

      Discount Fraction: For any Discount Loan, the following fraction:

               5.50% - the Pass-Through Rate on such Discount Loan
               ---------------------------------------------------
                                      5.50%

                                       14
<PAGE>

      Discount Fractional Principal Amount: On each Distribution Date, an amount
equal to the product of the Discount Fraction multiplied by the sum of (i)
scheduled payments of principal on each Discount Loan due on or before the
related Due Date in respect of which no distribution has been made on any
previous Distribution Date and which were received by the Determination Date, or
which have been advanced as part of an Advance with respect to such Distribution
Date, (ii) the principal portion received in respect of each Discount Loan
during the Prepayment Period of (a) Curtailments, (b) Insurance Proceeds, (c)
the amount, if any, of the principal portion of the Purchase Price pursuant to a
Purchase Obligation or any repurchase of a Discount Loan permitted hereunder and
(d) Liquidation Proceeds and (iii) the principal portion of Payoffs received in
respect of each Discount Loan during the applicable Payoff Period.

      Discount Fractional Principal Shortfall: For any Distribution Date, an
amount equal to the Discount Fraction of any Realized Loss on a Discount Loan,
other than a Special Hazard Loss, Fraud Loss or Bankruptcy Loss in excess of the
Special Hazard Coverage, Fraud Coverage or Bankruptcy Coverage, as applicable.

      Discount Loan: The Loans having Pass-Through Rates of less than 5.50%.

      Disqualified Organization: A "disqualified organization" as defined in
Section 860E(e)(5) of the Code, and, for purposes of Section 5.1 herein, as
defined in Section 5.1(b).

      Distribution Date: With respect to distributions on the Certificates, the
25th day (or, if such 25th day is not a Business Day, the Business Day
immediately succeeding such 25th day) of each month, with the first such date
being January 26, 2004. The "related Due Date" for any Distribution Date is the
Due Date immediately preceding such Distribution Date.

      DTC: The Depository Trust Company.

      DTC Participant: A broker, dealer, bank, other financial institution or
other Person for whom DTC effects book-entry transfers and pledges of securities
deposited with DTC.

      Due Date: The first day of each calendar month, which is the day on which
the Monthly Payment for each Loan is due.

      Eligible Account: Any account or accounts held and established by the
Servicer or the Trustee in trust for the Certificateholders at any Eligible
Institution.

      Eligible Institution: An institution having (i) the highest short-term
debt rating, and one of the two highest long-term debt ratings of each Rating
Agency, (ii) with respect to any Custodial Account for P&I, an unsecured
long-term debt rating of at least one of the two highest unsecured long-term
debt ratings of each Rating Agency, or (iii) the approval of each Rating Agency.
Notwithstanding the foregoing, Washington Mutual Bank, FA shall be an "Eligible
Institution" if the following conditions are satisfied: (i) Washington Mutual
Bank, FA is acting as Servicer, (ii) if

                                       15
<PAGE>

S&P is a Rating Agency as defined herein, the long-term unsecured debt
obligations of Washington Mutual Bank, FA are rated no lower than "A-" by S&P
and the short-term unsecured debt obligations of Washington Mutual Bank, FA are
rated no lower than "A-2" by S&P, (iii) if Fitch is the Rating Agency as defined
herein, the long-term unsecured debt obligations of Washington Mutual Bank, FA
are rated no lower than "A" by Fitch and the short-term unsecured debt
obligations of Washington Mutual Bank, FA are rated no lower than "F1" by Fitch
and (iv) if Moody's is a Rating Agency as defined herein, the long-term
unsecured debt obligations of Washington Mutual Bank, FA are rated no lower than
"A2" by Moody's and the short-term unsecured debt obligations of Washington
Mutual Bank, FA are rated no lower than "P-1" by Moody's; provided, that if the
long- term or short-term unsecured debt obligations of Washington Mutual Bank,
FA are downgraded by any of the Rating Agencies to a rating lower than the
applicable rating specified in this sentence, Washington Mutual Bank, FA shall
cease to be an "Eligible Institution" ten Business Days after notification of
such downgrade.

      Eligible Investments: Any one or more of the following obligations or
securities payable on demand or having a scheduled maturity on or before the
Business Day preceding the following Distribution Date, (or with regard to the
Certificate Account maintained with the Trustee or the Servicer, having a
scheduled maturity on or before the following Distribution Date; provided that,
such Eligible Investments shall be managed by, or be an obligation of, the
institution that maintains the Certificate Account if such Eligible Investments
mature on the Distribution Date) regardless of whether issued by the Depositor,
the Servicer, the Trustee or any of their respective Affiliates and having at
the time of purchase, or at such other time as may be specified, the required
ratings, if any, provided for in this definition:

            (a) direct obligations of, or guaranteed as to full and timely
      payment of principal and interest by, the United States or any agency or
      instrumentality thereof, provided, that such obligations are backed by the
      full faith and credit of the United States of America;

            (b) direct obligations of, or guaranteed as to timely payment of
      principal and interest by, FHLMC, FNMA or the Federal Farm Credit System,
      provided, that any such obligation, at the time of purchase or contractual
      commitment providing for the purchase thereof, is qualified by each Rating
      Agency as an investment of funds backing securities rated "Aaa" in the
      case of Moody's and "AAA" in the case of Fitch and S&P (the initial rating
      of the Class A Certificates);

            (c) demand and time deposits in or certificates of deposit of, or
      bankers' acceptances issued by, any bank or trust company, savings and
      loan association or savings bank, provided, that the short-term deposit
      ratings and/or long-term unsecured debt obligations of such depository
      institution or trust company (or in the case of the principal depository
      institutions in a holding company system, the commercial paper or
      long-term unsecured debt obligations of such holding
      company) have, in the case of commercial paper, the highest short-term
      rating available for such securities by each Rating Agency and, in the
      case of long-term unsecured debt obligations, one of the two highest
      ratings available for

                                       16
<PAGE>

      such securities by each Rating Agency, or in each case such lower rating
      as will not result in the downgrading or withdrawal of the rating or
      ratings then assigned to any Class of Certificates by any Rating Agency
      but in no event less than the initial rating of the Senior Certificates;

            (d) general obligations of or obligations guaranteed by any state of
      the United States or the District of Columbia receiving one of the two
      highest long-term debt ratings available for such securities by each
      Rating Agency, or such lower rating as will not result in the downgrading
      or withdrawal of the rating or ratings then assigned to any Class of
      Certificates by any Rating Agency;

            (e) commercial or finance company paper (including both
      non-interest-bearing discount obligations and interest-bearing obligations
      payable on demand or on a specified date not more than one year after the
      date of issuance thereof) that is rated by each Rating Agency in its
      highest short-term unsecured rating category at the time of such
      investment or contractual commitment providing for such investment, and is
      issued by a corporation the outstanding senior long-term debt obligations
      of which are then rated by each Rating Agency in one of its two highest
      long-term unsecured rating categories, or such lower rating as will not
      result in the downgrading or withdrawal of the rating or ratings then
      assigned to any Class of Certificates by any Rating Agency but in no event
      less than the initial rating of the Senior Certificates;

            (f) guaranteed reinvestment agreements issued by any bank, insurance
      company or other corporation rated in one of the two highest rating levels
      available to such issuers by each Rating Agency at the time of such
      investment, provided, that any such agreement must by its terms provide
      that it is terminable by the purchaser without penalty in the event any
      such rating is at any time lower than such level;

            (g) repurchase obligations with respect to any security described in
      clause (a) or (b) above entered into with a depository institution or
      trust company (acting as principal) meeting the rating standards described
      in (c) above;

            (h) securities bearing interest or sold at a discount that are
      issued by any corporation incorporated under the laws of the United States
      of America or any State thereof and rated by each Rating Agency in one of
      its two highest long-term unsecured rating categories at the time of such
      investment or contractual commitment providing for such investment;
      provided, however, that securities issued by any such corporation will not
      be Eligible Investments to the extent that investment therein would cause
      the outstanding principal amount of securities issued by such corporation
      that are then held as part of the Certificate Account to exceed 20% of the
      aggregate principal amount of all Eligible Investments then held in the
      Certificate Account;

                                       17
<PAGE>

            (i) units of taxable money market funds (including those for which
      the Trustee or any affiliate thereof receives compensation with respect to
      such investment) which funds have been rated by each Rating Agency in its
      highest rating category or which have been designated in writing by each
      Rating Agency as Eligible Investments with respect to this definition;

            (j) if previously confirmed in writing to the Trustee, any other
      demand, money market or time deposit, or any other obligation, security or
      investment, as may be acceptable to each Rating Agency as a permitted
      investment of funds backing securities having ratings equivalent to the
      initial rating of the Class A Certificates; and

            (k) such other obligations as are acceptable as Eligible Investments
      to each Rating Agency;

provided, however, that such instrument continues to qualify as a "cash flow
investment" pursuant to Code Section 860G(a)(6) and that no instrument or
security shall be an Eligible Investment if (i) such instrument or security
evidences a right to receive only interest payments or (ii) the right to receive
principal and interest payments derived from the underlying investment provides
a yield to maturity in excess of 120% of the yield to maturity at par of such
underlying investment.

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

      Escrow Account: As defined in Section 3.4.

      Escrow Payment: Any payment received by the Servicer for the account of
any Mortgagor for application toward the payment of taxes, insurance premiums,
assessments and similar items in respect of the related Mortgaged Property.

      Event of Default: Any event of default as specified in Section 7.1.

      Excess Liquidation Proceeds: With respect to any Distribution Date, the
excess, if any, of aggregate Liquidation Proceeds in the applicable Prepayment
Period over the amount that would have been received if Payoffs had been made
with respect to such Loans on the dates such Liquidation Proceeds were received.

      Excess Loss: A Special Hazard Loss incurred on a Loan in excess of the
Special Hazard Coverage, a Fraud Loss incurred on a Loan in excess of the Fraud
Coverage and a Bankruptcy Loss incurred on a Loan in excess of the Bankruptcy
Coverage.

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

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

                                       18
<PAGE>

      Federal Funds Rate: means, for any day, the rate set forth in the weekly
statistical release designated as H.15(519), or any successor publication,
published by the Federal Reserve Bank of New York on the preceding Business Day
opposite the caption "Federal Funds (Effective)"; or, if for any relevant day
such rate is not so published on any such preceding Business Day, the rate for
such day will be the arithmetic mean as determined by the Trustee of the rates
for the last transaction in overnight Federal funds arranged before 9:00 a.m.
(New York City time) on that day by each of three leading brokers of Federal
funds transactions in New York City selected by the Trustee.

      FHA: Federal Housing Administration, or any successor thereto.

      FHLMC: Federal Home Loan Mortgage Corporation, or any successor thereto.

      Final Certification: The certification substantially in the form of
Exhibit C-3 attached hereto.

      Fitch: Fitch Ratings, provided, that at anytime it is a Rating Agency.

      FNMA: Fannie Mae, or any successor thereto.

      Fraud Coverage: As of the Cut-Off Date approximately $3,546,780, and
thereafter, the Fraud Coverage will generally be equal to (1) prior to the third
Anniversary, an amount equal to (a) 1.00% of the aggregate Principal Balance of
all Loans as of the Cut-Off Date minus (b) the aggregate amounts allocated to
the Certificates with respect to Fraud Losses on the Loans up to such date of
determination; (2) from the third to the fifth Anniversary, an amount equal to
(a) 0.50% of the aggregate Principal Balance of all of the Loans as of the most
recent Anniversary minus (b) the aggregate amounts allocated to the Certificates
with respect to Fraud Losses on the Loans since the most recent Anniversary up
to such date of determination; and (3) on and after the fifth Anniversary, the
Fraud Coverage will be zero. The Fraud Coverage may be reduced upon written
confirmation from each Rating Agency that such reduction will not adversely
affect the then current ratings assigned to the Certificates by each Rating
Agency.

      Fraud Loss: The occurrence of a loss on a Loan arising from any action,
event or state of facts with respect to such Loan which, because it involved or
arose out of any dishonest, fraudulent, criminal, negligent or knowingly
wrongful act, error or omission by the Mortgagor, originator (or assignee
thereof) of such Loan, Lender, or the Servicer, would result in an exclusion
from, denial of, or defense to coverage which otherwise would be provided by an
insurance policy previously issued with respect to such Loan.

      Independent: When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor and the Servicer, (ii)
does not have any direct financial interest or any material indirect financial
interest in the Depositor or the Servicer or any Affiliate of either and (iii)
is not connected with the Depositor or the Servicer as an officer, employee,
promoter, underwriter, trustee, partner, director or person performing similar
functions.

                                       19
<PAGE>

      Indirect DTC Participants: Entities such as banks, brokers, dealers or
trust companies that clear through or maintain a custodial relationship with a
DTC Participant, either directly or indirectly.

      Initial Certification: The certification substantially in the form of
Exhibit C-1 attached hereto.

      Insurance Proceeds: Amounts paid or payable by the insurer under any
insurance policy (including any replacement policy permitted under this
Agreement), covering any Loan or Mortgaged Property, including, without
limitation, any flood insurance policy, primary mortgage insurance policy or
hazard insurance policy required pursuant to Section 3.5, any title insurance
policy required pursuant to Section 2.3, and any FHA insurance policy or VA
guaranty.

      Interest Accrual Period: For all Classes of Certificates (other than the
Adjustable Rate Certificates), the calendar month preceding the month in which
the Distribution Date occurs. The Interest Accrual Period for the Adjustable
Rate Certificates for each Distribution Date is the period from the 25th day of
the month before the month in which a Distribution Date occurs (or the Closing
Date, in the case of the first Distribution Date) through the 24th day of the
month in which that Distribution Date occurs.

      Interest Distribution Amount: On any Distribution Date, for any Class of
Certificates (other than the Principal Only Certificates), the amount of
interest accrued on the respective Class Principal Balance or Class Notional
Amount, as applicable, at 1/12th of the related Remittance Rate for such Class
during the applicable Interest Accrual Period, before giving effect to
allocations of Realized Losses in connection with such Distribution Date or
distributions to be made on such Distribution Date, reduced by Uncompensated
Interest Shortfall and the interest portion of Realized Losses allocated to such
Class pursuant to the definition of "Uncompensated Interest Shortfall" and
Section 3.20.

      Interest Only Certificates: The Class A-10 Certificates and Class A-X
Certificates.

      Interested Person: The Depositor, the Servicer, any Holder of a
Certificate, or any Affiliate of any such Person.

      Interim Certification: The certification substantially in the form of
Exhibit C-2 attached hereto.

      Junior Subordinate Certificates: The Class B-3, Class B-4 and Class B-5
Certificates, collectively.

      LIBOR: The per annum rate established by the Servicer in accordance with
Section 8.16.

                                       20
<PAGE>

      LIBOR Business Day: Any day on which dealings in United States dollars are
transacted in the London interbank market.

      LIBOR Determination Date: The second LIBOR Business Day before the first
day of the related Interest Accrual Period.

      Liquidated Loan: A Loan as to which the Servicer has determined in
accordance with its customary servicing practices that all amounts which it
expects to recover from or on account of such Loan, whether from Insurance
Proceeds, Liquidation Proceeds or otherwise, have been recovered. For purposes
of this definition, acquisition of a Mortgaged Property by the Trust Fund shall
not constitute final liquidation of the related Loan.

      Liquidation Expenses: Reasonable out of pocket expenses incurred by the
Servicer in connection with the liquidation of any Defaulted Loan or property
acquired in respect thereof, including, without limitation, legal fees and
expenses, any unreimbursed amount expended by the Servicer pursuant to Section
3.7 respecting the related Loan and any unreimbursed expenditures for real
property taxes or for property restoration or preservation relating to the
Mortgaged Property that secured such Loan.

      Liquidation Principal: The principal portion of Liquidation Proceeds
received with respect to each Loan which became a Liquidated Loan (but not in
excess of the Principal Balance thereof) during the applicable Prepayment
Period, exclusive of the Discount Fraction of Liquidation Proceeds received with
respect to each Discount Loan, if any.

      Liquidation Proceeds: Amounts after deduction of amounts reimbursable
under Section 3.7 received and retained in connection with the liquidation of
Defaulted Loans (including the disposition of REO Property), whether through
foreclosure or otherwise, other than Insurance Proceeds.

      Loans: The Mortgages and the related Mortgage Notes, each transferred and
assigned to the Trustee pursuant to the provisions hereof as from time to time
are held as part of the Trust Fund, as so identified in the Loan Schedule.

      Each of the Loans is referred to individually in this Agreement as a
"Loan."

      Loan Schedule: The schedule, as amended from time to time, of Loans
attached hereto as Exhibit D, which shall set forth as to each Loan the
following, among other things:

      (i)   the loan number of the Loan;

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

      (iii) the Mortgage Interest Rate as of the Cut-Off Date;

                                       21
<PAGE>

      (iv)  the original term and maturity date of the related Mortgage Note;

      (v)   the original Principal Balance;

      (vi)  the first payment date;

      (vii) the Monthly Payment in effect as of the Cut-Off Date;

     (viii) the date of the last paid installment of interest;

      (ix)  the unpaid Principal Balance as of the close of business on the
            Cut-Off Date;

      (x)   the Loan-to-Value ratio at origination;

      (xi)  the type of property and the Original Value of the Mortgaged
            Property;

      (xii) whether a primary mortgage insurance policy is in effect as of the
            Cut-Off Date;

     (xiii) the nature of occupancy at origination;

      (xiv) the servicing fee (which may be disclosed in two parts identified as
            the servicing fee and master servicing fee or the "Lending Fee" and
            "Management Fee");

      (xv)  the county in which Mortgaged Property is located, if available; and

      (xvi) the closing date.

      Loan-to-Value Ratio: The original principal amount of a Loan divided by
the Original Value; however, references to "current Loan-to-Value Ratio" shall
mean the then current Principal Balance of a Loan divided by the Original Value.

      Lockout Percentage: For any Distribution Date, will equal (i) the sum of
(x) the Class A-4 Class Principal Balance and (y) the Class A-7 Class Principal
Balance; divided by (ii) the aggregate Scheduled Principal Balance of all the
Loans immediately preceding the Distribution Date (exclusive of the Discount
Fraction of the Discount Loans).

      Lockout Principal Amount: For any Distribution Date will equal the sum of
(i) the product of (a) 0% for any Distribution Date prior to the Distribution
Date in January 2009, and thereafter, the Lockout Percentage and (b) the
Principal Payment Amount (exclusive of the portion thereof attributable to the
Discount Fractional Principal Amount); and (ii) the product of: (a) the Lockout
Percentage; (b) the Step Down Percentage; and (c) the sum of the following
amounts with respect to the Loans: (1) the Principal Prepayment Amount
(exclusive of the portion thereof attributable to the Discount Fractional
Principal Amount); and (2) the Liquidation Principal.

                                       22
<PAGE>

      Monthly Payment: The scheduled payment of principal and interest on a Loan
which is due on the related Due Date for such Loan after giving effect to any
reduction in the amount of interest collectible from any Mortgagor pursuant to
the Relief Act.

      Moody's: Moody's Investors Service, Inc. provided, that at any time it is
a Rating Agency.

      Mortgage: The mortgage, deed of trust or other instrument securing a
Mortgage Note.

      Mortgage File: As defined in Section 2.1.

      Mortgage Interest Rate: For any Loan, the per annum rate at which interest
accrues on such Loan pursuant to the terms of the related Mortgage Note without
regard to any reduction thereof as a result of the Relief Act.

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

      Mortgage Pool: All of the Loans.

      Mortgaged Property: With respect to any Loan, the real property, together
with improvements thereto, securing the indebtedness of the Mortgagor under the
related Loan.

      Mortgagor: The obligor on a Mortgage Note.

      Nonrecoverable Advance: With respect to any Loan, any Advance which the
Servicer shall have determined to be a Nonrecoverable Advance pursuant to
Section 4.4 and which was, or is proposed to be, made by such Servicer.

      Non-U.S. Person: A Person that is not a U.S. Person.

      Officer's Certificate: With respect to any Person, a certificate signed by
the Chairman of the Board, the President or a Vice-President of such Person (or,
in the case of a Person which is not a corporation, signed by the person or
persons having like responsibilities), and delivered to the Trustee.

      Opinion of Counsel: A written opinion of counsel, who may be outside or
salaried counsel for the Depositor or the Servicer, or any Affiliate of the
Depositor or the Servicer, acceptable to the Trustee; provided, that with
respect to REMIC matters, matters relating to the determination of Eligible
Accounts or matters relating to transfers of Certificates, such counsel shall be
Independent.

      Original Value: With respect to any Loan other than a Loan originated for
the purpose of refinancing an existing mortgage debt, the lesser of (a) the
Appraised Value (if any) of the Mortgaged Property at the time the Loan was
originated or (b) the purchase price paid for the

                                       23
<PAGE>

Mortgaged Property by the Mortgagor. With respect to a Loan originated for the
purpose of refinancing existing mortgage debt, the Original Value shall be equal
to the Appraised Value of the Mortgaged Property at the time the Loan was
originated or the appraised value at the time the refinanced mortgage debt was
incurred.

      OTS: The Office of Thrift Supervision, or any successor thereto.

      Ownership Interest: As defined in Section 5.1(b).

      Pass-Through Entity: As defined in Section 5.1(b).

      Pass-Through Rate: For each Loan and for any date of determination, a per
annum rate equal to the Mortgage Interest Rate for such Loan less the applicable
per annum percentage rate of the Servicing Fee. For each Loan, any calculation
of monthly interest at such rate shall be based upon annual interest at such
rate (computed on the basis of a 360-day year of twelve 30-day months) on the
unpaid Principal Balance of the related Loan divided by twelve, and any
calculation of interest at such rate by reason of a Payoff shall be based upon
annual interest at such rate on the outstanding Principal Balance of the related
Loan multiplied by a fraction, the numerator of which is the number of days
elapsed from the Due Date of the last scheduled payment of principal and
interest to, but not including, the date of such Payoff, and the denominator of
which is (a) for Payoffs received on a Due Date, 360, and (b) for all other
Payoffs, 365.

      Paying Agent: As defined in Section 4.10.

      Payoff: Any Mortgagor payment of principal on a Loan equal to the entire
outstanding Principal Balance of such Loan, if received in advance of the last
scheduled Due Date for such Loan and accompanied by an amount of interest equal
to accrued unpaid interest on the Loan to the date of such payment-in-full.

      Payoff Earnings: For any Distribution Date with respect to each Loan on
which a Payoff was received by the Servicer during the Payoff Period, the
aggregate of the interest earned by Servicer from investment of each such Payoff
from the date of receipt of such Payoff until the Business Day immediately
preceding the Distribution Date (net of investment losses).

      Payoff Interest: For any Distribution Date with respect to a Loan for
which a Payoff was received on or after the first day of the calendar month of
such Distribution Date and through and including the 14th day of such calendar
month, an amount of interest thereon at the applicable Pass-Through Rate from
the first day of the calendar month of distribution through the day of receipt
thereof; to the extent (together with Payoff Earnings and the portion of the
Servicing Fee described in clause (i)(a) of the definition of Compensating
Interest) not required to be distributed as Compensating Interest on such
Distribution Date. Payoff Interest shall be payable to the Servicer as
additional servicing compensation.

                                       24
<PAGE>

      Payoff Period: For the first Distribution Date, the period from the
Cut-Off Date through January 14, 2004, inclusive; and for any Distribution Date
thereafter, the period from the 15th day of the applicable calendar month
preceding such Distribution Date through the 14th day of the calendar month of
such Distribution Date, inclusive.

      Percentage Interest: (a) With respect to the right of each Certificate of
a particular Class in the distributions allocated to such Class, "Percentage
Interest" shall mean the percentage undivided beneficial ownership interest
evidenced by such Certificate of such Class, which percentage shall equal:

            (i) with respect to any Regular Interest Certificate (other than the
      Interest Only Certificates), its Certificate Principal Balance divided by
      the applicable Class Principal Balance;

            (ii) with respect to the Interest Only Certificates, the portion of
      the respective Class Notional Amount evidenced by such Certificate divided
      by the respective Class Notional Balance; and

            (iii) with respect to the Class R Certificate, the percentage set
      forth on the face of each such Certificate.

      (b) With respect to the rights of each Certificate in connection with
Sections 5.9, 7.1, 7.3, 8.3 and 10.1, "Percentage Interest" shall mean the
percentage undivided beneficial interest evidenced by such Certificate in the
Trust Fund, which for purposes of such rights only shall equal:

            (i) with respect to any Certificate (other than the Interest Only
      Certificates), the product of (x) 98.00% and (y) the percentage calculated
      by dividing its Certificate Principal Balance by the Aggregate Certificate
      Principal Balance; provided, however, that the product in (x) above shall
      be increased by one percent (1%) upon each retirement of an Interest Only
      Certificate;

            (ii) with respect to each Interest Only Certificate, one percent
      (1%) of such Certificate Percentage Interest as calculated by paragraph
      (a)(ii) of this definition; and

            (iii) with respect to the Class R Certificate, zero.

      Permitted Transferee: With respect to the holding or ownership of any
Residual Certificate, any Person other than (i) the United States, a State or
any political subdivision thereof, or any agency or instrumentality of any of
the foregoing, (ii) a foreign government or International Organization, or any
agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers' cooperatives described in Code Section 521) which is
exempt from the taxes imposed by Chapter 1 of the Code (unless such organization
is subject to the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described

                                       25
<PAGE>

in Code Section 1381(a)(2)(C), (v) any electing large partnership under Section
775 of the Code, (vi) any Person from whom the Trustee or the Certificate
Registrar has not received an affidavit to the effect that it is not a
"disqualified organization" within the meaning of Section 860E(e)(5) of the
Code, and (vii) any other Person so designated by the Depositor based upon an
Opinion of Counsel that the transfer of an Ownership Interest in a Residual
Certificate to such Person may cause the Trust Fund to fail to qualify as a
REMIC at any time that the Certificates are outstanding. The terms "United
States," "State" and "International Organization" shall have the meanings set
forth in Code Section 7701 or successor provisions. A corporation shall not be
treated as an instrumentality of the United States or of any State or political
subdivision thereof if all of its activities are subject to tax, and, with the
exception of the FHLMC, a majority of its board of directors is not selected by
such governmental unit.

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

      Plan: As defined in Section 5.1(d).

      Premium Loans: The Loans having Pass-Through Rates in excess of 5.50% per
annum.

      Prepaid Monthly Payment: Any Monthly Payment received prior to its
scheduled Due Date, which is intended to be applied to a Loan on its scheduled
Due Date and held in the related Custodial Account for P&I until the Withdrawal
Date following its scheduled Due Date.

      Prepayment Period: The calendar month immediately preceding any
Distribution Date.

      Principal Balance: At the time of any determination, the principal balance
of a Loan remaining to be paid at the close of business on the Cut-Off Date,
after deduction of all principal payments due on or before the Cut-Off Date
whether or not paid, reduced by all amounts distributed or to be distributed to
Certificateholders through the Distribution Date in the month of determination
that are reported as allocable to principal of such Loan.

      In the case of a Substitute Loan, "Principal Balance" shall mean, at the
time of any determination, the principal balance of such Substitute Loan
transferred to the Trust Fund on the date of substitution, reduced by all
amounts distributed or to be distributed to Certificateholders through the
Distribution Date in the month of determination that are reported as allocable
to principal of such Substitute Loan.

      The Principal Balance of a Loan (including a Substitute Loan) shall not be
adjusted solely by reason of any bankruptcy or similar proceeding or any
moratorium or similar waiver or grace period. Whenever a Realized Loss has been
incurred with respect to a Loan during a calendar month, the Principal Balance
of such Loan shall be reduced by the amount of such Realized Loss as of the

                                       26
<PAGE>

Distribution Date next following the end of such calendar month after giving
effect to the allocation of Realized Losses and distributions of principal to
the Certificates.

      Principal Only Certificates: The Class A-P Certificates.

      Principal Payment: Any payment of principal on a Loan other than a
Principal Prepayment.

      Principal Payment Amount: On any Distribution Date, the sum of (i) the
scheduled principal payments on the Loans due on the related Due Date, (ii) the
principal portion of repurchase proceeds received with respect to any Loan which
was repurchased by the Depositor pursuant to a Purchase Obligation or as
permitted by this Agreement prior to such Distribution Date, and (iii) any other
unscheduled payments of principal which were received with respect to any Loan
during the applicable Prepayment Period, other than Payoffs, Curtailments and
Liquidation Principal.

      Principal Prepayment: Any payment of principal on a Loan which constitutes
a Payoff or a Curtailment.

      Principal Prepayment Amount: On any Distribution Date, the sum of (i)
Curtailments received during the applicable Prepayment Period and (ii) Payoffs
received during the applicable Payoff Period.

      Pro Rata Allocation: The allocation of the principal portion of certain
losses relating to a Loan to the Senior Certificates (other than the Class A-P
Certificates and the Interest Only Certificates) and/or to the Subordinate
Certificates, as applicable, pro rata according to their respective Certificate
Principal Balances or, in the case of the Accrual Certificates, the Certificate
Principal Balance of those Accrual Certificates on the Closing Date, if lower,
in reduction thereof (except (1) if the loss is recognized with respect to a
Discount Loan, in which event the Discount Fraction of such loss will be
allocated to the Class A-P Certificates, and the remainder of such loss will be
allocated as described above in this definition without regard to this
parenthetical and (2)(a) all Realized Losses, except Excess Losses, otherwise
allocable to the Class A-1 Certificates will be allocated to the Class A-7
Certificates up to an amount equal to 33.209% of the Class Principal Balance of
the Class A-7 Certificates for such Distribution Date and up to a maximum
aggregate amount of $1,620,028 and (b) all Realized Losses, except Excess
Losses, otherwise allocable to the Class A-4 Certificates will be allocated to
the Class A-7 Certificates up to an amount equal to 66.791% of the Class
Principal Balance of the Class A-7 Certificates for such Distribution Date and
up to a maximum aggregate amount of $3,258,251, in each case until the Class
Principal Balance of the Class A-7 Certificates has been reduced to zero) in
reduction thereof, and the allocation of the interest portion of such losses to
the Certificates (other than the Class A-P Certificates), pro rata according to
the amount of interest accrued but unpaid on each such Class in reduction
thereof.

      Purchase Obligation: An obligation of the Depositor to repurchase Loans
under the circumstances and in the manner provided in Section 2.2 or Section
2.3.

                                       27
<PAGE>

      Purchase Price: With respect to any Loan to be purchased pursuant to a
Purchase Obligation, or any Loan to be purchased or repurchased relating to an
REO Property, an amount equal to the sum of the Principal Balance thereof, plus
accrued and unpaid interest thereon, if any, to the last day of the calendar
month in which the date of repurchase occurs at a rate equal to the applicable
Mortgage Interest Rate; provided, however, that no Loan shall be purchased or
required to be purchased pursuant to Section 2.3, or more than two years after
the Closing Date under Section 2.2, unless (a) the Loan to be purchased is in
default, or default is in the judgment of the Depositor reasonably imminent, or
(b) the Depositor, at its expense, delivers to the Trustee an Opinion of Counsel
to the effect that the purchase of such Loan will not give rise to a tax on a
prohibited transaction, as defined in Section 860F(a) of the Code; provided,
further, that in the case of clause (b) above, the Depositor will use its
reasonable efforts to obtain such Opinion of Counsel if such opinion is
obtainable.

      Rating Agency: Initially, each of Moody's and Fitch; thereafter, each
nationally recognized statistical rating organization that has rated the
Certificates at the request of the Depositor, or their respective successors in
interest.

      Ratings: As of any date of determination, the ratings, if any, of the
Certificates as assigned by each Rating Agency.

      Realized Loss: For any Distribution Date, with respect to any Loan which
became a Liquidated Loan during the related applicable Prepayment Period, the
sum of (i) the principal balance of such Loan remaining outstanding and the
principal portion of Nonrecoverable Advances actually reimbursed with respect to
such Loan (the principal portion of such Realized Loss), and (ii) the accrued
interest on such Loan remaining unpaid and the interest portion of
Nonrecoverable Advances actually reimbursed with respect to such Loan (the
interest portion of such Realized Loss). For any Distribution Date, with respect
to any Loan which is not a Liquidated Loan, the amount of the Bankruptcy Loss
incurred with respect to such Loan as of the related Due Date will be treated as
a Realized Loss.

      Record Date: With respect to each Distribution Date and each Class of
Certificates (other than the Adjustable Rate Certificates that are Book-Entry
Certificates), the close of business on the last Business Day of the month
immediately preceding the month of the related Distribution Date. With respect
to each Distribution Date and the Adjustable Rate Certificates so long as such
Certificates are Book-Entry Certificates, the Business Day immediately preceding
such Distribution Date.

      Regular Interest Certificates: The Certificates, other than the Class R
Certificate.

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

                                       28
<PAGE>

      Relief Act Interest Shortfall: With respect to any Distribution Date and
Loan, any reduction in the amount of interest collectible on such Loan for the
most recently ended calendar month immediately preceding such Distribution Date
as a result of the application of the Relief Act.

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

      REMIC I: The pool of assets (other than any Escrow Account or Accounts)
consisting of the Trust Fund.

      REMIC I Regular Interests: The regular interests in REMIC I as described
in Section 2.4 of this Agreement.

      REMIC II: The pool of assets consisting of the REMIC I Regular Interests
and all payments of principal or interest on or with respect to the REMIC I
Regular Interests after the Cut-Off Date.

      REMIC Provisions: Sections 860A through 860G of the Code, related Code
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.

      Remittance Rate: For each Class of interest bearing Certificates, the per
annum rate set forth as the Remittance Rate for such Class in the Preliminary
Statement hereto.

      REO Property: A Mortgaged Property, title to which has been acquired by
the Servicer on behalf of the Trust Fund through foreclosure, deed in lieu of
foreclosure or otherwise.

      Residual Certificates: The Class R Certificate, which is being issued in a
single class. Components R-1 and R-2 of the Class R Certificate is hereby
designated the sole Class of "residual interests" in REMIC I and REMIC II,
respectively, for purposes of Section 860G(a)(2) of the Code.

      Residual Distribution Amount: On any Distribution Date, any portion of the
Available Distribution Amount remaining after all distributions to the
Certificates pursuant to the definition of Certificate Distribution Amount
(including the Class R Certificate only to the extent of any distributions to
the Class R Certificate pursuant to clause (I)(a)(iv) of such definition). Upon
termination of the obligations created by this Agreement and the Trust Fund
created hereby, the amounts which remain on deposit in the Certificate Account
after payment to the Certificateholders of the amounts set forth in Section 9.1
of this Agreement, and subject to the conditions set forth therein.

      Responsible Officer: When used with respect to the Trustee, any officer
assigned to and working in its Corporate Trust Department or similar group, and
also, with respect to a particular matter, any other officer to whom such matter
is referred because of such officer's knowledge of and familiarity with the
particular subject. When used with respect to the Servicer or the Seller, the
Chairman or Vice-Chairman of the Board of Directors, the Chairman or
Vice-Chairman of the

                                       29
<PAGE>

Executive or Standing Committee of the Board of Directors, the President, any
Vice-President, the Secretary, any Assistant Secretary, the Treasurer, any
Assistant Treasurer, the Controller and any Assistant Controller or any other
officer of the Servicer customarily performing functions similar to those
performed by any of the above-designated officers, and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge of and familiarity with the particular subject. When
used with respect to the Servicer, the Chairman or Vice-Chairman of the Board of
Directors or Trustees, the Chairman or Vice-Chairman of the Executive or
Standing Committee of the Board of Directors or Trustees, the President, any
Vice-President, the Secretary, any Assistant Secretary, the Treasurer, any
Assistant Treasurer, the Controller and any Assistant Controller or any other
officer of the Servicer customarily performing functions similar to those
performed by any of the above-designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge of and familiarity with the particular subject. When
used with respect to the Depositor or any other Person, the Chairman or
Vice-Chairman of the Board of Directors, the Chairman or Vice-Chairman of any
executive committee of the Board of Directors, the President, any
Vice-President, the Secretary, any Assistant Secretary, the Treasurer, any
Assistant Treasurer, or any other officer of the Depositor customarily
performing functions similar to those performed by any of the above-designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.

      S&P: Standard & Poor's, a division of The McGraw-Hill Companies, Inc.,
provided, that at any time it is a Rating Agency.

      Scheduled Principal Balance: With respect to any Loan as of any
Distribution Date, the unpaid principal balance of such Loan as specified in the
amortization schedule at the time relating thereto (before any adjustment to
such schedule by reason of bankruptcy or similar proceeding or any moratorium or
similar waiver or grace period) as of the first day of the calendar month
preceding the month of such Distribution Date, after giving effect to any
previously applied Curtailments, the payment of principal due on such first day
of the calendar month and any reduction of the Scheduled Principal Balance of
such Loan by a bankruptcy court, irrespective of any delinquency in payment by
the related Mortgagor.

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

      Seller: Washington Mutual Mortgage Securities Corp.

      Senior Certificates: The Class A Certificates and the Class R Certificate,
collectively.

      Senior Liquidation Amount: The aggregate, for each Loan which became a
Liquidated Loan during the applicable Prepayment Period, of the lesser of: (i)
the Senior Percentage of the Principal Balance of such Loan (exclusive of the
Discount Fraction thereof, if applicable), and (ii) the Senior Prepayment
Percentage of the Liquidation Principal with respect to such Loan.

                                       30
<PAGE>

      Senior Percentage: As of the Closing Date 97.03%, and thereafter, with
respect to any Distribution Date, the sum of the Class Principal Balances of the
Senior Certificates (other than the Class A-P Certificates) divided by aggregate
Scheduled Principal Balance of all Loans (reduced by the Discount Fraction of
the Discount Loans), in each case immediately prior to such Distribution Date.

      Senior Prepayment Percentage: (i) On any Distribution Date occurring
before the Distribution Date in the month of January 2009, 100%; (ii) on any
other Distribution Date on which the Senior Percentage for such Distribution
Date exceeds the initial Senior Percentage as of the Cut-Off Date, 100%; and
(iii) on any other Distribution Date in each of the months of January 2009 and
thereafter, 100%, unless:

      (a) the mean aggregate Principal Balance of the Loans which are 60 or more
days delinquent (including loans in foreclosure and property held by the Trust
Fund) for each of the immediately preceding six calendar months is less than or
equal to 50% of the Subordinate Amount as of such Distribution Date, and

      (b) cumulative Realized Losses on the Loans allocated to the Subordinate
Certificates are less than or equal to the following amounts:

<TABLE>
<CAPTION>
                                                                     Percentage of the Subordinate
                   Distribution Date Occurring In                    Amount as of the Cut-Off Date
      ----------------------------------------------------------     -----------------------------
<S>                                                                               <C>
      January 2009 through December 2009........................                  30%
      January 2010 through December 2010........................                  35%
      January 2011 through December 2011........................                  40%
      January 2012 through December 2012........................                  45%
      January 2013 and thereafter...............................                  50%
</TABLE>

            in which case, the Senior Prepayment Percentage shall be as follows:

<TABLE>
<CAPTION>
      Distribution Date Occurring In                         Senior Prepayment Percentage
---------------------------------------------    -------------------------------------------------
<S>                                              <C>
January 2004 through December 2009...........    100%
January 2010 through September 2010..........    Senior Percentage + 70% of Subordinate Percentage
January 2011 through September 2011..........    Senior Percentage + 60% of Subordinate Percentage
January 2012 through September 2012..........    Senior Percentage + 40% of Subordinate Percentage
January 2013 through September 2013..........    Senior Percentage + 20% of Subordinate Percentage
January 2014 and thereafter..................    Senior Percentage
</TABLE>

      If on any Distribution Date the allocation to the Senior Certificates
(other than the Class A-P Certificates) of Principal Prepayments in the
percentage required would reduce the sum of the Class Principal Balances of the
Senior Certificates (other than the Class A-P Certificates) below zero, the
Senior Prepayment Percentage for such Distribution Date shall be limited to the
percentage necessary to reduce such sum to zero. Notwithstanding the foregoing,
however, on each Distribution Date, the

                                       31
<PAGE>

Class A-P Certificates will receive the Discount Fraction of all principal
payments, including, without limitation, Principal Prepayments, received in
respect of each Discount Loan.

      Senior Principal Amount: For any Distribution Date, an amount equal to the
sum of (a) the Senior Percentage of the Principal Payment Amount for the Loans
(exclusive of the portion thereof included in the sum of the Discount Fractional
Principal Amounts for such Distribution Date), (b) the Senior Prepayment
Percentage of the Principal Prepayment Amount for the Loans (exclusive of the
portion thereof included in the sum of the Discount Fractional Principal Amounts
for such Distribution Date) and (c) the Senior Liquidation Amount.

      Senior Subordinate Certificates: The Class M, Class B-1 and Class B-2
Certificates, collectively.

      Servicer: Washington Mutual Mortgage Securities Corp., a Delaware
corporation, or any successor thereto appointed as provided pursuant to Section
7.5, acting to service and administer such Loans pursuant to Section 3.1.

      Servicer's Section 3.10 Report: A report delivered by the Servicer to the
Trustee pursuant to Section 3.10.

      Servicing Fee: For each Loan in the Loan Schedule, the fee paid to the
Servicer to perform primary servicing functions with respect to such Loan as
specified on the Loan Schedule.

      Servicing Officer: Any individual involved in, or responsible for, the
administration and servicing of the Loans whose name and specimen signature
appear on a list of servicing officers furnished to the Trustee on the Closing
Date by the Servicer in the form of an Officer's Certificate, as such list may
from time to time be amended.

      Special Hazard Coverage: As of the Cut-Off Date $2,057,133, and thereafter
on each Anniversary, the Special Hazard Coverage shall be reduced, but not
increased, to an amount equal to the lesser of (1) the greatest of (a) the
aggregate Principal Balance of the Loans located in the single California zip
code area containing the largest aggregate Principal Balance of the Loans, (b)
1% of the aggregate unpaid Principal Balance of the Loans and (c) twice the
unpaid Principal Balance of the largest single Loan, in each case calculated as
of the Due Date in the immediately preceding month, and (2) the initial Special
Hazard Coverage as of the Cut-Off Date as reduced by the Special Hazard Losses
allocated to the Certificates since the Cut-Off Date. Special Hazard Coverage
may be reduced upon written confirmation from each Rating Agency that such
reduction will not adversely affect the then current ratings assigned to the
Certificates by each Rating Agency.

      Special Hazard Loss: The occurrence of any direct physical loss or damage
to a Mortgaged Property which is caused by or results from any cause except (i)
physical loss or damage covered by a standard fire and hazard maintenance policy
with extended coverage, except to the extent of that portion of the loss which
was uninsured because of the application of a co-insurance clause; (ii)

                                       32
<PAGE>

normal wear and tear, gradual deterioration, inherent vice or inadequate
maintenance of all or part thereof; (iii) errors in design, faulty workmanship
or materials, unless the collapse of the property or a part thereof ensues and
then only for the ensuing loss; (iv) nuclear reaction or nuclear radiation or
radioactive contamination, all whether controlled or uncontrolled and whether
such loss be direct or indirect, proximate or remote or be in whole or in part
caused by, contributed to or aggravated by a peril covered by this definition of
Special Hazard Loss; (v) hostile or warlike action in time of peace or war,
including action in hindering, combating or defending against an actual,
impending or expected attack (a) by any government or sovereign power (dejure or
defacto), or by an authority maintaining or using military, naval or air forces,
(b) by military, naval or air forces, or (c) by an agent of any such government,
power, authority or forces; (vi) any weapon of war employing atomic fission or
radioactive force whether in time of peace or war; (vii) insurrection,
rebellion, revolution, civil war, usurped power or action taken by governmental
authority in hindering, combating or defending against such occurrence; or
(viii) seizure or destruction under quarantine or customs regulations, or
confiscation by order of any government or public authority.

      Step Down Percentage: For any Distribution Date will be the percentage
indicated below:

                 Distribution Date Occurring In            Step Down Percentage
      --------------------------------------------------   ---------------------
      January 2004 through December 2008................             0%
      January 2009 through December 2009................            30%
      January 2010 through December 2010................            40%
      January 2011 through December 2011................            60%
      January 2012 through December 2012................            80%
      January 2013 and thereafter.......................           100%

      Subordinate Amount: The excess of the aggregate Scheduled Principal
Balance of the Loans over the sum of the Certificate Principal Balances of the
Senior Certificates.

      Subordinate Certificates: The Class M, Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates, collectively, and designated as such on
the face thereof in substantially the form attached hereto as Exhibit A-2 and
for purposes of this Agreement, the "order of seniority" from highest to lowest
of such certificates shall be the order designated in the beginning of this
definition.

      Subordinate Liquidation Amount: The excess, if any, of the aggregate of
Liquidation Principal for all the Loans which became Liquidated Loans during the
applicable Prepayment Period, over the related Senior Liquidation Amount for
such Distribution Date.

      Subordinate Percentage: As of the Closing Date 2.97%, and thereafter, with
respect to any Distribution Date, the excess of 100% over the Senior Percentage
for such date.

      Subordinate Prepayment Percentage: As of the Closing Date 0%, and
thereafter, with respect to any Distribution Date, the excess of 100% over the
Senior Prepayment Percentage.

      Subordinate Principal Amount: On any Distribution Date, will be equal to
the sum of:

                                       33
<PAGE>

            (1) the Subordinate Percentage of the Principal Payment Amount
      (exclusive of the portion thereof attributable to the sum of the Discount
      Fractional Principal Amounts for such Distribution Date);

            (2) the Subordinate Principal Prepayment Amount; and

            (3) the Subordinate Liquidation Amount;

provided, however, that the Subordinate Principal Amount shall be reduced by the
amounts required to be distributed to the Principal Only Certificates with
respect to the Discount Fractional Principal Shortfall on such Distribution
Date.

      Any reduction in the Subordinate Principal Amount pursuant to the proviso
above shall offset the amount calculated pursuant to clause (1), clause (3) and
clause (2), in such order of priority. On any Distribution Date, the Subordinate
Principal Amount shall be allocated pro rata, by Class Principal Balance, among
the Classes of Subordinate Certificates and paid in the order of distribution to
such Classes pursuant to clause (I)(b) of the definition of "Certificate
Distribution Amount" herein, except as otherwise stated in such definition.
Notwithstanding the foregoing, on any Distribution Date prior to distributions
on such date, if the Subordination Level for any Class of Subordinate
Certificates is less than such percentage as of the Closing Date, the pro rata
portion of the Subordinate Principal Prepayment Amount otherwise allocable to
the Class or Classes junior to such Class will be distributed to the most senior
Class of the Subordinate Certificates for which the Subordination Level is less
than such percentage as of the Closing Date, and to the Classes of Subordinate
Certificates senior thereto, pro rata according to the Class Principal Balances
of such Classes.

      Subordinate Principal Prepayment Amount: On any Distribution Date, the
Subordinate Prepayment Percentage of the Principal Prepayment Amount for the
Loans (exclusive of the portion thereof attributable to the sum of the Discount
Fractional Principal Amounts for such Distribution Date).

      Subordination Level: On any specified date, with respect to any Class of
Subordinate Certificates, the percentage obtained by dividing: (1) the sum of
the Class Principal Balances of all Classes of Certificates which are
subordinate in right of payment to such Class as of such date before giving
effect to distributions or allocations of Realized Losses on the Loans on such
date; by (2) the sum of the Class Principal Balances of all Classes of
Certificates as of such date before giving effect to distributions or
allocations of Realized Losses on the Loans on such date.

      Substitute Loan: As defined in Section 2.2.

      Tax Matters Person: The Holder of the Class R Certificate issued hereunder
or any Permitted Transferee of such Class R Certificateholder shall be the
initial "tax matters person" for REMIC I and REMIC II within the meaning of
Section 6231(a)(7) of the Code. For tax years commencing

                                       34
<PAGE>

after any transfer of the Class R Certificate, the holder of the greatest
Percentage Interest in the Class R Certificate at year end shall be designated
as the Tax Matters Person with respect to that year. If the Tax Matters Person
becomes a Disqualified Organization, the last preceding Holder of such
Authorized Denomination of the Class R Certificate that is not a Disqualified
Organization shall be Tax Matters Person pursuant to Section 5.1(c). If any
Person is appointed as tax matters person by the Internal Revenue Service
pursuant to the Code, such Person shall be Tax Matters Person.

      Transfer: As defined in Section 5.1(b).

      Transferee: As defined in Section 5.1(b).

      Transferee Affidavit and Agreement: As defined in Section 5.1(c)(i)(B).

      Trust Fund: The corpus of the trust created pursuant to Section 2.1 of
this Agreement. The Trust Fund consists of (i) the Loans and all rights
pertaining thereto; (ii) such assets as from time to time may be held by the
Trustee (except amounts representing the Servicing Fee and amounts on deposit in
Escrow Accounts); (iii) such assets as from time to time may be held by the
Servicer in a Custodial Account for P&I related to the Loans (except amounts
representing the Servicing Fee); (iv) property which secured a Loan and which
has been acquired by foreclosure or deed in lieu of foreclosure after the
Cut-Off Date; (v) amounts paid or payable by the insurer under any FHA insurance
policy and proceeds of any VA guaranty and any other insurance policy related to
any Loan or the Mortgage Pool; and (vi) the rights and remedies of the Depositor
contained in Section 8 under the Mortgage Loan Purchase Agreement dated as of
the Closing Date, between the Seller and the Depositor.

      Trustee: U.S. Bank National Association, a national banking association,
or its successor-in-interest as provided in Section 8.9, or any successor
trustee appointed as herein provided.

      Uncollected Interest: With respect to any Distribution Date for any Loan
on which a Payoff was made by a Mortgagor during the related Payoff Period,
except for Payoffs received during the period from the first through the 14th
day of the month of such Distribution Date, an amount equal to one month's
interest at the applicable Pass-Through Rate on such Loan less the amount of
interest actually paid by the Mortgagor with respect to such Payoff.

      Uncompensated Interest Shortfall: With respect to any Distribution Date,
the excess, if any, of (i) the sum of (a) aggregate Uncollected Interest and (b)
aggregate Curtailment Shortfall and (c) any shortfall in interest collections in
the calendar month immediately preceding such Distribution Date resulting from a
Relief Act Interest Shortfall over (ii) Compensating Interest, which excess
shall be allocated to each Class of Certificates pro rata according to the
amount of interest accrued thereon in reduction thereof.

      Underwriters: Credit Suisse First Boston LLC and ABN AMRO Financial
Services, Inc.

                                       35
<PAGE>

      U.S. Person: A citizen or resident of the United States, a corporation or
partnership (including an entity treated as a corporation or partnership for
federal income tax purposes) created or organized in, or under the laws of, the
United States or any state thereof or the District of Columbia (except, in the
case of a partnership, to the extent provided in regulations) or an estate whose
income is subject to United States federal income tax regardless of its source,
or a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more such U.S.
Persons have the authority to control all substantial decisions of the trust. To
the extent prescribed in regulations by the Secretary of the Treasury, a trust
which was in existence on August 20, 1996 (other than a trust treated as owned
by the grantor under subpart E of part 1 of subchapter J of chapter 1 of the
Code), and which was treated as a U.S. Person on August 20, 1996 may elect to
continue to be treated as a U.S. Person notwithstanding the previous sentence.

      VA: The Department of Veterans Affairs, formerly known as the Veterans
Administration, or any successor thereto.

      Withdrawal Date: The Business Day immediately preceding the related
Distribution Date.

      All references to the origination date or original date in the Loan
Schedule with respect to a Loan shall refer to the date upon which the related
Mortgage Note was originated or modified, whichever is later.

                                       36
<PAGE>

                                   ARTICLE II

                            CONVEYANCE OF TRUST FUND;
                        ORIGINAL ISSUANCE OF CERTIFICATES

      Section 2.1 Conveyance of Trust Fund.

      The Depositor, concurrently with the execution and delivery hereof, does
hereby irrevocably sell, convey and assign to the Trustee and REMIC I without
recourse all the right, title and interest of the Depositor in and to the Trust
Fund and to REMIC II without recourse all the right, title and interest of the
Depositor in and to the REMIC I Regular Interests, for the benefit respectively
of REMIC II and the Certificateholders, including all interest and principal
received by the Depositor with respect to the Loans after the Cut-Off Date (and
including without limitation scheduled payments of principal and interest due
after the Cut-Off Date but received by the Depositor on or before the Cut-Off
Date, but not including payments of principal and interest due on the Loans on
or before the Cut-Off Date). The Depositor, at its own expense, shall file or
cause to be filed protective Form UCC-1 financing statements with respect to the
Loans in the State of Delaware or other applicable jurisdiction, listing itself
as "Debtor" under such financing statement and listing the Trustee, for the
benefit of the Certificateholders, as "Secured Party" under such financing
statement.

      In connection with such assignment, the Depositor does hereby deliver to,
and deposit with, the Trustee or the Custodian, as its agent, for the benefit of
the Certificateholders the following documents or instruments with respect to
each Loan so assigned:

            (i) The original Mortgage Note (or, if the original Mortgage Note
      has been lost or destroyed, a lost note affidavit and indemnity) bearing
      all intervening endorsements endorsed, "Pay to the order of U.S. Bank
      National Association, as Trustee, for the benefit of the
      Certificateholders of ABN AMRO Mortgage Corporation Series 2003-13,
      without recourse" and signed in the name of the last endorsee thereof
      showing an unbroken chain of title from the originator thereof to the
      person endorsing;

            (ii) (a) The original Mortgage with evidence of recording thereon,
      and if the Mortgage was executed pursuant to a power of attorney, a
      certified true copy of the power of attorney certified by the recorder's
      office, with evidence of recording thereon, or certified by a title
      insurance company or escrow company to be a true copy thereof; provided,
      that if such original Mortgage or power of attorney cannot be delivered
      with evidence of recording thereon on or prior to the Closing Date because
      of a delay caused by the public recording office where such original
      Mortgage has been delivered for recordation or because such original
      Mortgage has been lost, the Depositor shall deliver or cause to be
      delivered to the Trustee or the Custodian a true and correct copy of such
      Mortgage, together with (1) in the case of a delay caused by the public
      recording office, an Officer's Certificate signed by a Responsible Officer
      of the Seller stating that such original Mortgage has been dispatched to

                                       37
<PAGE>

      the appropriate public recording official for recordation or (2) in the
      case of an original Mortgage that has been lost, a certificate by the
      appropriate county recording office where such Mortgage is recorded or
      from a title insurance company or escrow company indicating that such
      original was lost and the copy of the original mortgage is a true and
      correct copy;

            (b) The original Assignment to "U.S. Bank National Association, as
      custodian/trustee," which assignment shall be in form and substance
      acceptable for recording, or a copy certified by the Seller or the
      originator of the related Loan as a true and correct copy of the original
      Assignment which has been sent for recordation. Subject to the foregoing,
      such assignments may, if permitted by law, be by blanket assignments for
      Loans covering Mortgaged Properties situated within the same county. If
      the Assignment is in blanket form, a copy of the Assignment shall be
      included in the related individual Mortgage File.

            (iii) The originals of any and all instruments that modify the terms
      and conditions of the Mortgage Note, including but not limited to
      modification, consolidation, extension and assumption agreements including
      any adjustable rate mortgage (ARM) rider, if any,

            (iv) The originals of all required intervening assignments, if any,
      with evidence of recording thereon, and if such assignment was executed
      pursuant to a power of attorney, a certified true copy of the power of
      attorney certified by the recorder's office, with evidence of recording
      thereon, or certified by a title insurance company or escrow company to be
      a true copy thereof; provided, that if such original assignment or power
      of attorney cannot be delivered with evidence of recording thereon on or
      prior to the Closing Date because of a delay caused by the public
      recording office where such original assignment has been delivered for
      recordation or because such original Assignment has been lost, the
      Depositor shall deliver or cause to be delivered to the Trustee or the
      Custodian a true and correct copy of such Assignment, together with (a) in
      the case of a delay caused by the public recording office, an Officer's
      Certificate signed by a Responsible Officer of the Seller stating that
      such original assignment has been dispatched to the appropriate public
      recording official for recordation or (b) in the case of an original
      assignment that has been lost, a certificate by the appropriate county
      recording office where such assignment is recorded or from a title
      insurance company or escrow company indicating that such original was lost
      and the copy of the original assignment is a true and correct copy; and

            (v) The original mortgagee policy of title insurance (including, if
      applicable, the endorsement relating to the negative amortization of the
      Loans) or in the event such original title policy is unavailable, any one
      of an original title binder, an original preliminary title report or an
      original title commitment or a copy thereof certified by the title company
      with the original policy of title insurance to follow within 180 days of
      the Closing Date.

      The documents and instruments set forth in clauses (i) - (v) above shall
be called, collectively, the "Mortgage File".

                                       38
<PAGE>

      If the Depositor cannot deliver the original Mortgage with evidence of
recording thereon concurrently with the execution and delivery of this Agreement
because of a delay caused by the public recording office where such original
Mortgage has been delivered for recordation, the Depositor shall deliver to the
Trustee or the Custodian an Officer's Certificate, with a photocopy of such
Mortgage attached thereto, stating that such original Mortgage has been
delivered to the appropriate public recording official for recordation. The
Depositor shall promptly deliver to the Trustee or the Custodian such original
Mortgage with evidence of recording indicated thereon upon receipt thereof from
the public recording official.

      The Depositor shall, at its own expense, promptly record or cause to be
recorded in the appropriate public real property or other records each
Assignment referred to in Section 2.1(ii), unless the Depositor delivers to the
Trustee an Independent opinion of counsel to the effect that such recordation is
not necessary to protect the Trustee's and Certificateholder's interest in the
related Mortgage Loans, in which case such Assignments shall be delivered to the
Trustee or the Custodian for the benefit of the Certificateholders in recordable
form. If the Depositor cannot deliver the original Assignment concurrently with
the execution and delivery of this Agreement solely because it is in the process
of being prepared and recorded or because of a delay caused by the public
recording office where such original Assignment has been delivered for
recordation, the Depositor shall deliver a blanket Officer's Certificate
covering all such Assignments stating that such original Assignment is in the
process of being prepared and recorded or it has been delivered to the
appropriate public recording official for recordation. Any such original
recorded Assignment shall be delivered to the Trustee or the Custodian within
180 days following the execution of this Agreement.

      If the Depositor cannot deliver the original title insurance policy
concurrently with the execution and delivery of this Agreement, the Depositor
shall promptly deliver each such original title insurance policy as soon as such
policy becomes available but in no event later than 120 days following the
execution of this Agreement.

      All rights arising out of Loans including, without limitation, all funds
received on or in connection with a Loan shall be held by the Depositor in trust
for the benefit of the Certificateholders. The Depositor shall maintain a
complete set of books and records for each Loan which shall be clearly marked to
reflect the ownership of each Loan by the Certificateholders.

      It is the express intent of this Agreement that the conveyance of the
Loans by the Depositor to the Trustee (directly or through the Custodian) as
provided in this Section 2.1 be, and be construed as, a sale of the Loans by the
Depositor to the Trustee and that the sale of the Certificates to the
Certificateholders, if they are sold, be, and be construed as, a sale of a 100%
interest in the Loans and the Trust Fund to such Certificateholders. It is,
further, not the intention of this Agreement that such conveyance be deemed a
pledge of the Loans by the Depositor to the Trustee to secure a debt or other
obligation of the Depositor. However, in the event that, notwithstanding the
intent of this Agreement, the Loans are held to be property of the Depositor, or
if for any other reason this Agreement is held or deemed to create a security
interest in the Loans, then (a) this Agreement shall

                                       39
<PAGE>

also be deemed to be a security agreement within the meaning of Articles 8 and 9
of the New York Uniform Commercial Code; (b) the conveyance provided for in this
Section 2.1 shall be deemed to be a grant by the Depositor to the Trustee for
the benefit of the Certificateholders of a security interest in all of the
Depositor's right, title and interest in and to the Loans and all amounts
payable to the holders of the Loans in accordance with the terms thereof and all
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property, including without limitation
all amounts, other than investment earnings, from time to time held or invested
in the Certificate Account, whether in the form of cash, instruments, securities
or other property; (c) the possession by the Trustee or any Custodian of
Mortgage Notes and such other items of property as constitute instruments,
money, negotiable documents or chattel paper shall be deemed to be "in
possession by the secured party" for purposes of perfecting the security
interest pursuant to Section 9-305 of the New York Uniform Commercial Code; and
(d) notifications to persons holding such property, and acknowledgments,
receipts or confirmations from persons holding such property, shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Trustee for the benefit
of the Certificateholders for the purpose of perfecting such security interest
under applicable law (except that nothing in this clause (d) shall cause any
person to be deemed to be an agent of the Trustee for any purpose other than for
perfection of such security interest unless, and then only to the extent,
expressly appointed and authorized by the Trustee in writing). The Depositor and
the Trustee, upon directions from the Depositor, shall, to the extent consistent
with this Agreement, take such actions as may be necessary to ensure that, if
this Agreement were deemed to create a perfected security interest in Loans,
such security interest would be deemed to be a perfected security interest of
first priority under applicable law and will be maintained as such throughout
the term of this Agreement.

      The Depositor initially appoints U.S. Bank National Association as
Custodian, and the Servicer consents to such appointment. In acting as Custodian
for the Mortgage Files, the Custodian may act through its duly authorized
officers, employees and agents; provided that the Custodian may not employ any
sub-agents without the written consent of the Depositor and the Servicer. The
Servicer shall pay any and all fees and expenses of the Custodian; provided
that, so long as U.S. Bank National Association is the Trustee and Custodian
hereunder, such fees and expenses of the Custodian, if any, shall be paid by the
Trustee. Any sub-custodian may be removed by the Custodian with the approval of
the Servicer and the Depositor, and a successor sub-custodian shall be appointed
by the Servicer as set forth in the related sub- custodial agreement.

      Section 2.2 Acceptance by Custodian.

      (a) The Custodian acknowledges, subject to the provisions of Section 2.1
and to any document exceptions reported pursuant to the Custodian's reviews as
described below, receipt on behalf of the Trustee of the Mortgage Notes (or lost
note affidavits and indemnities), the Mortgages, the assignments of the
Mortgages and the Officer's Certificates referred to in Section 2.1 above, and
declares that it holds and will hold such documents and the other documents
constituting a part of the Mortgage Files delivered to it as Custodian for the
benefit of the Trustee who holds such property in trust, upon the trusts herein
set forth, for the use and benefit of all present and future

                                       40
<PAGE>

Certificateholders. The Custodian acknowledges that, as of the date of the
execution of this Agreement, the Mortgage Files have been delivered to the
Custodian, and the Custodian has conducted a preliminary review of the Mortgage
Files. The Custodian further acknowledges that such review included a review of
the Mortgage Notes (or lost note affidavits and indemnities) to determine that
the appropriate Mortgage Notes (or lost note affidavits and indemnities) have
been delivered and endorsed in the manner set forth in Section 2.1(i). In
connection with such review, on or prior to the Closing Date, the Custodian
shall have delivered an exceptions report as to the Mortgage Files that the
Custodian has in its possession indicating any discrepancies relating to such
review and shall execute and deliver, or cause to be executed and delivered to
the Depositor and the Trustee an Initial Certification, substantially in the
form attached hereto as Exhibit C-1.

      (b) No later than 90 days after the Closing Date, the Custodian agrees,
for the benefit of the Certificateholders, to review each Mortgage File
delivered to it and to execute and deliver, or cause to be executed and
delivered, to the Depositor and the Trustee an Interim Certification
substantially in the form attached hereto as Exhibit C-2. In conducting such
review, the Custodian agrees to ascertain that all required documents set forth
in items (i), (ii), (iii), (iv) and (v) of Section 2.1, to the extent delivered
to the Custodian have been executed and received, and that such documents relate
to the Loans identified in Exhibit D annexed hereto, and in so doing the
Custodian may rely on the purported due execution and genuineness of any such
document and on the purported genuineness of any signature thereon. The
Custodian shall have no duty to verify or determine whether any Mortgage File
should contain documents described in Sections 2.1(iii) and (iv). The Custodian
shall be under no duty or obligation to inspect, review or make any independent
examination of any documents contained in each Mortgage File beyond the review
specifically required herein. The Custodian makes no representations as to (i)
the validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each Mortgage File or any of the Loans identified on the
Loan Schedule, or (ii) the collectability, insurability, effectiveness or
suitability of any such Loan. If at the conclusion of such 90-day period the
Custodian finds that any document constituting a part of a Mortgage File not to
have been executed or received or to be unrelated to the Loans identified in
said Exhibit D (each such finding, a "material defect"), the Custodian shall
promptly notify the Depositor which shall have a period of 90 days after the
Depositor has received notice to correct or cure any such material defect;
provided, however, that if the Custodian shall not have received a document by
reason of the fact that such document shall not have been returned by the
appropriate recording office then the Depositor shall have until a date one year
later from the Cut-Off Date to correct or cure such defect.

      The Depositor hereby covenants and agrees that, if any such material
defect as defined above is not corrected or cured, the Depositor will, within 90
days of the REMIC having received notice, either (i) repurchase the related Loan
at a price equal to 100% of the Principal Balance of such Loan (or any property
acquired in respect thereof) plus accrued interest on such Principal Balance at
the applicable Mortgage Interest Rate to the next scheduled Due Date of such
Loan or (ii) substitute for any Loan to which such material defect relates a
different mortgage loan (a "Substitute Loan") maturing no later than and not
more than two years earlier than the Loan being substituted for and having a
principal balance equal to or less than the loan being substituted for and a
Mortgage Interest

                                       41
<PAGE>

Rate equal to or greater than the Mortgage Interest Rate of the Loan being
substituted for, a Loan-to-Value Ratio equal to or less than the Loan-to-Value
Ratio of the Loan being substituted for and otherwise having such
characteristics so that the representations and warranties of the Depositor set
forth in Section 2.3 hereof would not have been incorrect had such Substitute
Loan originally been a Loan; provided, however, that if the Principal Balance of
the original Loan exceeds the principal balance of the Substitute Loan, an
amount equal to that difference shall be deposited by the Depositor in the
Certificate Account; provided, further, that if the defect would cause the Loan
to be other than a "qualified mortgage loan" as defined in Section 860(G)(a)(3)
of the Code such cure, repurchase or substitution must occur within 90 days from
the date such material defect was discovered, unless the Trustee shall have
received from the Depositor an Opinion of Counsel to the effect that such cure,
repurchase or substitution will not adversely affect the REMIC status of REMIC I
or REMIC II or constitute a prohibited transaction or substitution under the
REMIC provisions of the Code, and, if applicable, within the meaning of the
REMIC Provisions of the particular State, if any, which would impose a tax on
the Trust Fund.

      (c) In addition, the Custodian agrees, for the benefit of
Certificateholders, to review each Mortgage File delivered to it within 180 days
after the Closing Date, or with respect to assignments which must be recorded,
within 180 days, after execution of this Agreement and to execute and deliver,
or cause to be executed and delivered, to the Depositor and the Trustee a Final
Certification substantially in the form attached hereto as Exhibit C-3. In
conducting such review, the Custodian agrees that if at the conclusion of such
180-day period the Custodian finds a material defect, the Custodian shall
promptly notify the Depositor, which shall have a period of 90 days after the
REMIC has received such notice to correct or cure any such material defect. The
Depositor hereby covenants and agrees that, if any such material defect as
defined above is not corrected or cured, the Depositor will, within 90 days of
the REMIC having received such notice, either repurchase the related Loan or
substitute for any Loan to which such material defect relates in accordance with
this Agreement.

      Monthly Payments due with respect to Substitute Loans in the month of
substitution are not a part of the Trust Fund and will be retained by the
Seller. The Depositor shall notify each Rating Agency of any such substitution.
For the month of substitution, distributions to Certificateholders will include
the Monthly Payment due on the Loan being substituted for in such month. The
purchase price for the repurchased Loan or property shall be deposited by the
Depositor in the Certificate Account and in the case of a Substitute Loan, the
Mortgage File relating thereto shall be delivered to the Custodian. Upon receipt
by the Custodian of written notification of such deposit signed by a Servicing
Officer or the new Mortgage File, as the case may be, and an Officer's
Certificate that such repurchase or substitution is in accordance with this
Agreement, the Custodian shall release or cause to be released to the Depositor
the related Mortgage File for the Loan being repurchased or substituted for, as
the case may be, and shall execute and deliver or cause to be executed and
delivered such instrument of transfer or assignment presented to it by the
Depositor, in each case without recourse, as shall be necessary to transfer to
the Depositor the Custodian's interest in such original or repurchased Loan or
property and the Custodian shall have no further responsibility with regard to
such Loan. It is understood and agreed that the obligation of the Depositor to
substitute a new Loan for or repurchase any Loan or property as to which such a
material defect in a constituent

                                       42
<PAGE>

document exists shall constitute the sole remedy respecting such defect
available to Certificateholders or the Trustee on behalf of Certificateholders,
but such obligation shall survive termination of this Agreement. Neither the
Trustee nor the Custodian shall be responsible for determining whether any
assignment or mortgage delivered pursuant to Section 2.1(ii) is in recordable
form or, if recorded, has been properly recorded.

      Section 2.3 Representations and Warranties of the Depositor with respect
to the Loans.

      The Depositor hereby represents and warrants to the Trustee as of the
Closing Date:

            (i) that the information set forth in the Loan Schedule appearing as
      an exhibit to this Agreement is true and correct in all material respects
      at the date or dates respecting which such information is furnished as
      specified therein;

            (ii) that as of the date of the transfer of the Loans to the
      Trustee, the Depositor is the sole owner and holder of each Loan free and
      clear of all liens, pledges, charges or security interests of any nature
      and has full right and authority, subject to no interest or participation
      of, or agreement with, any other party, to sell and assign the same;

            (iii) that as of the date of initial issuance of the Certificates,
      no payment of principal of or interest on or in respect of any Loan is 30
      days or more past due from the Due Date of such Loan;

            (iv) that to the best of the Depositor's knowledge, as of the date
      of the transfer of the Loans to the Trustee, there is no valid offset,
      defense or counterclaim to any Mortgage Note or Mortgage;

            (v) that as of the date of the initial issuance of the Certificates,
      there is no proceeding pending, or to the best of the Depositor's
      knowledge, threatened for the total or partial condemnation of any of the
      Mortgaged Property and, to the best of the Depositor's knowledge, the
      Mortgaged Property is free of material damage and is in good repair and
      neither the Mortgaged Property nor any improvement located on or being
      part of the Mortgaged Property is in violation of any applicable zoning
      law or regulation;

            (vi) that each Loan complies in all material respects with
      applicable state or federal laws, regulations and other requirements,
      pertaining to usury, equal credit opportunity and disclosure laws, and
      each Loan was not usurious at the time of origination;

            (vii) that to the best of the Depositor's knowledge, as of the date
      of the initial issuance of the Certificates, all insurance premiums
      previously due and owing with respect to the Mortgaged Property have been
      paid and all taxes and governmental assessments previously due and owing,
      and which may become a lien against the Mortgaged Property, with respect
      to the Mortgaged Property have been paid;

                                       43
<PAGE>

            (viii) that each Mortgage Note and the related Mortgage are genuine
      and each is the legal, valid and binding obligation of the maker thereof,
      enforceable in accordance with its terms except as such enforcement may be
      limited by bankruptcy, insolvency, reorganization or other similar laws
      affecting the enforcement of creditors' rights generally and by general
      equity principles (regardless of whether such enforcement is considered in
      a proceeding in equity or at law); all parties to the Mortgage Note and
      the Mortgage had legal capacity to execute the Mortgage Note and the
      Mortgage; and each Mortgage Note and Mortgage have been duly and properly
      executed by the Mortgagor;

            (ix) that each Mortgage is a valid and enforceable first lien on the
      property securing the related Mortgage Note, and that each Loan is covered
      by an ALTA mortgagee title insurance policy or other form of policy or
      insurance generally acceptable to FNMA or FHLMC, issued by, and is a valid
      and binding obligation of, a title insurer acceptable to FNMA or FHLMC
      insuring the originator, its successor and assigns, as to the lien of the
      Mortgage in the original principal amount of the Loan subject only to (a)
      the lien of current real property taxes and assessments not yet due and
      payable, (b) covenants, conditions and restrictions, rights of way,
      easements and other matters of public record as of the date of recording
      of such Mortgage acceptable to mortgage lending institutions in the area
      in which the Mortgaged Property is located or specifically referred to in
      the appraisal performed in connection with the origination of the related
      Loan and (c) such other matters to which like properties are commonly
      subject which do not individually, or in the aggregate, materially
      interfere with the benefits of the security intended to be provided by the
      Mortgage;

            (x) that as of the initial issuance of the Certificates, neither the
      Depositor nor any prior holder of any Mortgage has, except as the Mortgage
      File may reflect, modified the Mortgage in any material respect;
      satisfied, canceled or subordinated such Mortgage in whole or part;
      released such Mortgaged Property in whole or in part from the lien of the
      Mortgage; or executed any instrument of release, cancellation,
      modification or satisfaction;

            (xi) that each Mortgaged Property consists of a fee simple estate or
      a condominium form of ownership in real property;

            (xii) no foreclosure action is threatened or has been commenced
      (except for the filing of any notice of default) with respect to the Loan;
      and except for payment delinquencies not in excess of 30 days, to the best
      of the Depositor's knowledge, there is no default, breach, violation or
      event of acceleration existing under the Mortgage or the related Mortgage
      Note and no event which, with the passage of time or with notice and the
      expiration of any grace or cure period, would constitute a default,
      breach, violation or event of acceleration; and the Depositor has not
      waived any default, breach, violation or event of acceleration;

                                       44
<PAGE>

            (xiii) that each Loan was originated on FNMA or FHLMC uniform
      instruments for the state in which the Mortgaged Property is located;

            (xiv) that based upon a representation by each Mortgagor at the time
      of origination or assumption of the applicable Mortgage Loan,
      approximately 93.95% of the Mortgage Loans measured by principal balance
      were to be secured by owner-occupied residences and approximately 6.05% of
      the Mortgage Loans measured by principal balance were secured by
      owner-occupied second home residences;

            (xv) that an appraisal of each Mortgaged Property was conducted at
      the time of origination of the related Loan, and that each such appraisal
      was conducted in accordance with FNMA or FHLMC criteria, on FNMA or FHLMC
      forms and comparables on at least three properties were obtained;

            (xvi) that no Loan had a Loan-to-Value Ratio at origination in
      excess of 95%;

            (xvii) the Loans were not selected in manner to adversely affect the
      interests of the Certificateholders and the Depositor knows of no
      conditions which reasonably would cause it to expect any Loan to become
      delinquent or otherwise lose value;

            (xviii) each Loan was either (A) originated directly by or closed in
      the name of either: (i) a savings and loan association, savings bank,
      commercial bank, credit union, insurance company, or similar institution
      which is supervised and examined by a federal or state authority or (ii) a
      mortgagee approved by the Secretary of Housing and Urban Development
      pursuant to Sections 203 and 211 of the National Housing Act or (B)
      originated or underwritten by an entity employing underwriting standards
      consistent with the underwriting standards of an institution as described
      in subclause (A)(i) or (A)(ii) above;

            (xix) each Loan is a "qualified mortgage" within the meaning of
      Section 860G of the Code without regard to ss. 1.860G-2(f) of the REMIC
      Provisions or any similar rule;

            (xx) each Loan that has a Loan-to-Value Ratio in excess of 80% is
      covered by a primary mortgage insurance policy;

            (xxi) that no Loan permits negative amortization or the deferral of
      accrued interest;

            (xxii) no Loan is a "high-cost home loan" as defined in the Georgia
      Fair Lending Act, as amended, or in the New York Predatory Lending Law,
      codified as N.Y. Banking Law Section 6-l, N.Y. Gen. Bus. Law Section
      771-a, and N.Y. Real Prop. Acts Law Section 1302, the Arkansas Home Loan
      Protection Act, as amended, the Kentucky Revised Statutes Section 360.100,
      as amended, or the Florida Home Loan Protection Act ss.494.007 (the
      "Florida Act"); no Loan is a "covered loan" as defined in the District of
      Columbia Home Loan Protection Act ss.26-1151.01 (the "D.C. Act"); no Loan
      is a "high-rate, high-fee mortgage"

                                       45
<PAGE>

      as defined in Maine Consumer Credit Code -- Truth In Lending ss.8-103 (the
      "Maine Act"); and no Loan is a "home loan" as defined in Nevada Revised
      Statutes title 52, as amended by Assembly Bill No. 284, 72nd Session
      (Nevada 2003) (the "Nevada Act"); and

            (xxiii) no Loan is subject to the Home Ownership and Equity
      Protection Act of 1994, as amended.

      It is understood and agreed that the representations and warranties set
forth in this Section 2.3 shall survive delivery of the respective Mortgage
Files to the Trustee, or to a Custodian, as the case may be. Upon discovery by
the Depositor, Servicer, the Trustee or any Custodian of a breach of any of the
foregoing representations and warranties (referred to herein as a "breach"),
without regard to any limitation set forth in such representation or warranty
concerning the knowledge of the Depositor as to the facts stated therein, which
breach materially and adversely affects the interests of the Certificateholders
in the related Loan, the party discovering such breach shall give prompt written
notice to the others and to each Rating Agency.

      Within 90 days of its discovery or its receipt of notice of breach, the
Depositor shall cure or shall cause such breach to be cured in all material
respects or shall repurchase the Loan or any property acquired in respect
thereof from the Trustee at a repurchase price equal to 100% of the Principal
Balance of such Loan plus accrued interest on such Principal Balance at the
Mortgage Interest Rate to the next scheduled Due Date of such Loan or remove
such Loan from the Trust Fund and substitute in its place a Substitute Loan or
Loans with the characteristics set forth in Section 2.2 above for Substitute
Loans; provided, however, that if such breach would cause the Loan to be other
than a "qualified mortgage" as defined in Section 860G(a)(3) of the Code, any
such cure, repurchase or substitution must occur within 90 days from the date
such breach was discovered; provided, further, that no substitution (or cure
which would constitute a loan modification for federal income tax purposes) may
be effected any later than two years after the Closing Date; provided, further,
that as a pre-condition to any substitution (or cure which would constitute a
loan modification for federal income tax purposes) to be effected later than 90
days after the Closing Date (and within two years of the Closing Date), the
Trustee shall receive from the Depositor an Opinion of Counsel to the effect
that such substitution (or cure which would constitute a loan modification for
federal income tax purposes) will not adversely affect the REMIC status of REMIC
I or REMIC II or constitute a prohibited transaction under the REMIC Provisions
of the Code and, if applicable, the REMIC provisions of the relevant State.
Except as expressly set forth herein, neither the Trustee nor the Servicer is
under any obligation to discover any breach of the above mentioned
representations and warranties. It is understood and agreed that the obligation
of the Depositor to repurchase or substitute any Loan or property as to which a
breach has occurred and is continuing shall constitute the sole remedy
respecting such breach available to Certificateholders or the Trustee on behalf
of Certificateholders, and such obligation shall survive as the obligation of
the Depositor, or its respective successors.

                                       46
<PAGE>

      Section 2.4 Authentication and Delivery of Certificates; Designation of
Certificates as REMIC Regular and Residual Interests.

      (a) The Trustee acknowledges the transfer to the extent provided herein
and assignment to it of the Trust Fund and, concurrently with such transfer and
assignment, has caused to be authenticated and delivered to or upon the order of
the Depositor, in exchange for the Trust Fund, Certificates evidencing the
entire ownership of the Trust Fund.

      (b) This Agreement shall be construed so as to carry out the intention of
the parties that each of REMIC I and REMIC II be treated as a REMIC at all times
prior to the date on which the Trust Fund is terminated. The "regular interests"
(within the meaning of Section 860G(a)(1) of the Code) in REMIC II shall consist
of the Class A Certificates and the Subordinate Certificates. The "residual
interest" (within the meaning of Section 860G(a)(2) of the Code) in REMIC II
shall consist of Component R-2 of the Class R Certificate. The "regular
interests" (within the meaning of Section 860G(a)(1) of the Code) of REMIC I
shall consist of Class A-1 Regular Interest, the Class A-2 Regular Interest, the
Class A-3 Regular Interest, the Class A-4 Regular Interest, the Class A-5
Regular Interest, the Class A-6 Regular Interest, the Class A-7 Regular
Interest, the Class A-8 Regular Interest, the Class A-9 Regular Interest, the
Class A-X Regular Interest, the Class A-P Regular Interest, the Class M Regular
Interest, the Class B-1 Regular Interest, the Class B-2 Regular Interest, the
Class B-3 Regular Interest, the Class B-4 Regular Interest and the Class B-5
Regular Interest. The "residual interest" (within the meaning of Section
860(G)(a)(2) of the Code) of REMIC I shall consist of Component R-1 of the Class
R Certificate.

      (c) All payments with respect to each of the Class A-1, Class A-2, Class
A-3, Class A-4, Class A-5, Class A-6, Class A-7, Class A-8, Class A-9, Class
A-X, Class A-P, Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class
B-5 Certificates shall each be considered to have been made solely from the
Regular Interest of REMIC I having the same designation. All principal payments
with respect to each such Class of Certificates (other than the Class A-10
Certificates and Class A-X Certificates) shall be considered to have been made
solely from the principal payments of the corresponding Regular Interests of
REMIC I, and the Class Principal Balance of each such Class of Certificate
(other than the Class A-X Certificates) shall be equal at all times to the
principal balance of each such corresponding Regular Interest of REMIC I. All
interest payments with respect to the Class A-10 Certificates shall be
considered to have been made solely from the interest payments of the Class A-9
Regular Interest of REMIC I. All interest payments with respect to the Class A-X
Certificates shall be considered to have been made solely from the interest
payments of the Class A-X Regular Interest of REMIC I. The interest rate of each
REMIC I Regular Interest Class A-1, Class A-2, Class A-3, Class A-4, Class A-5,
Class A-6, Class A-7, Class M, Class B-1, Class B-2, Class B-3, Class B-4 and
Class B-5 shall be 5.50%. The interest rate of each REMIC I Regular Interest
Class A-8 and Class A-9 shall be 5.25% and 8.00%, respectively. The Class A-P
Regular Interest Class shall not bear interest, but will receive principal only
in respect of the Loans.

      (d) The Class A-10 Certificates shall be considered for federal income tax
purposes to have a notional principal amount which is equal to the principal
balance of the Class A-9 Regular

                                       47
<PAGE>

Interest, bearing interest at 7.55% per annum minus LIBOR with a minimum rate of
0.00% per annum and a maximum rate of 7.55% per annum.

      (e) The Class A-X Certificates shall be considered for federal income tax
purposes to have a notional principal amount which is equal to the total
Principal Balance of the Premium Loans.

      Section 2.5 Designation of Startup Day.

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

      Section 2.6 No Contributions.

      The Trustee shall not accept or make any contribution of cash to the Trust
Fund after 90 days of the Closing Date, and shall not accept or make any
contribution of other assets to the Trust Fund unless, in either case, it shall
have received an Opinion of Counsel to the effect that the inclusion of such
assets in the Trust Fund will not cause REMIC I or REMIC II to fail to qualify
as a REMIC at any time that any Class A or Subordinate Certificates are
outstanding or subject the Trust Fund to any tax on contributions to the REMIC
under Section 860G(d) of the Code.

      Section 2.7 Representations and Warranties of the Servicer.

      The Servicer hereby represents, warrants and covenants to the Trustee for
the benefit of Certificateholders that, as of the date of execution of this
Agreement:

      (a) the Servicer is a corporation duly formed and validly existing under
the laws of the State of Delaware;

      (b) the execution and delivery of this Agreement by the Servicer and its
performance of and compliance with the terms of this Agreement will not violate
the Servicer's corporate charter or by-laws or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default) under,
or result in the breach of, any material contract, agreement or other instrument
to which the Servicer is a party or which may be applicable to the Servicer or
any of its assets;

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

                                       48
<PAGE>

      (d) the Servicer is not in default with respect to any order or decree of
any court or any order, regulation or demand of any federal, state, municipal or
governmental agency, which default might have consequences that would materially
and adversely affect the condition (financial or other) or operations of the
Servicer or its properties or might have consequences that would affect its
performance hereunder; and

      (e) no litigation is pending or, to the best of the Servicer's knowledge,
threatened against the Servicer which would prohibit its entering into this
Agreement or performing its obligations under this Agreement.

      It is understood and agreed that the representations and warranties set
forth in this Section 2.7 shall survive delivery of the respective Mortgage
Files to the Trustee, or to a Custodian, as the case may be.

                                       49
<PAGE>

                                   ARTICLE III

                      ADMINISTRATION AND SERVICING OF LOANS

      Section 3.1 Servicer to Act as Servicer; Administration of the Loans.

      (a) The Servicer shall service and administer the Loans on behalf of the
Trust Fund solely in the best interests of and for the benefit of the
Certificateholders (as determined by the Servicer in its reasonable judgment)
and the Trustee (as trustee for Certificateholders) in accordance with the terms
of this Agreement and the respective Loans and, to the extent consistent with
such terms, in the same manner in which, and with the same care, skill, prudence
and diligence with which, it services and administers similar mortgage loans for
other portfolios, giving due consideration to customary and usual standards of
practice of prudent institutional residential mortgage lenders and loan
servicers, and taking into account its other obligations hereunder, but without
regard to:

            (i) any relationship that the Servicer, any sub-servicer, any
      special servicer or any Affiliate of the Servicer, any sub-servicer or any
      special servicer may have with the related Mortgagor;

            (ii) the ownership of any Certificate by the Servicer, any special
      servicer or any Affiliate of the Servicer, any sub-servicer or any special
      servicer;

            (iii) the Servicer's, any sub-servicer's or any special servicer's
      right to receive compensation for its services hereunder or with respect
      to any particular transaction; or

            (iv) the ownership, or servicing or management for others, by the
      Servicer, any sub-servicer or any special servicer, of any other mortgage
      loans or property.

      In addition, the Servicer shall have full power and authority to do or
cause to be done any and all things in connection with such servicing and
administration which it may deem necessary or desirable, including, without
limitation, the power and authority to bring actions and defend the Trust Fund
on behalf of the Trustee in order to enforce the terms of the Mortgage Notes.
The Servicer may perform its servicing responsibilities through agents or
independent contractors, but shall not thereby be released from any of its
responsibilities hereunder and the Servicer shall diligently pursue all of its
rights against such agents or independent contractors.

      To the extent consistent with the foregoing and subject to any express
limitations set forth in this Agreement, the Servicer shall seek to maximize the
timely and complete recovery of principal and interest on the Mortgage Notes;
provided, however, that nothing herein contained shall be construed as an
express or implied guarantee by the Servicer of the collectability of the Loans.
Subject only to the above-described servicing standards and the terms of this
Agreement and of the respective Loans, the Servicer, as an independent
contractor, shall service and administer the Loans

                                       50
<PAGE>

and shall have full power and authority, acting alone or through one or more
subservicers, special servicers or agents (subject to paragraph (c) of this
Section 3.1), to do any and all things in connection with such servicing and
administration which it may deem necessary or desirable for the purpose of
conserving the assets of the Trust Fund. Without limiting the generality of the
foregoing, the Servicer shall and is hereby authorized and empowered by the
Trustee to continue to execute and deliver, on behalf of itself, the
Certificateholders and the Trustee or any of them, any and all financing
statements, continuation statements and other documents or instruments necessary
to maintain the lien on each Mortgaged Property and related collateral; and
modifications, waivers, consents or amendments to or with respect to any
documents contained in the related Mortgage File; and any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge,
assignments of Mortgages and endorsements of Notes in connection with
refinancings (in jurisdictions where such assignments are the customary and
usual standard of practice of mortgage lenders) and all other comparable
instruments, with respect to the Loans and with respect to the related Mortgaged
Properties. Notwithstanding the foregoing, the Servicer (whether acting alone or
through one or more subservicers, special servicers or agents) shall not modify,
amend, waive or otherwise consent to the change of the terms of any of the Loans
(including without limitation extending the stated maturity date of any Loan or
forgiving principal of or interest on any Loan), except as permitted by Section
3.2 hereof. The Servicer shall service and administer the Loans in accordance
with applicable law and shall provide to the Mortgagors any reports required to
be provided to them thereby. To enable the Servicer to carry out its servicing
and administrative duties hereunder, upon the Servicer's written request
accompanied by the forms of any documents requested, the Trustee shall execute
and deliver to the Servicer any powers of attorney and other documents necessary
or appropriate and the Trustee shall not be responsible for releasing such
powers of attorney. The Trustee shall not be responsible for, and the Servicer
shall indemnify the Trustee for, any action taken by the Servicer pursuant to
the application of any such power of attorney. The relationship of the Servicer
(and of any successor thereto) to the Trustee under this Agreement is intended
by the parties to be that of an independent contractor and not that of a joint
venturer, partner or agent.

      In connection with the servicing and administration of each Loan, the
Servicer and any affiliate of the Servicer (i) may perform services such as
appraisals, default management and brokerage services that are not customarily
provided by servicers of mortgage loans, and shall be entitled to reasonable
compensation therefor not in excess of market rates for such services and (ii)
may, at its own discretion and on behalf of the Trustee, obtain credit
information in the form of a "credit score" from a credit repository.

      (b) The Servicer, Trustee and Depositor intend that REMIC I and REMIC II
formed hereunder shall constitute, and that the Servicer shall perform its
duties and obligation hereunder so as to qualify each of them as, a "real estate
mortgage investment conduit" as defined in and in accordance with the REMIC
Provisions. The Tax Matters Person, or the Person acting as attorney-in-fact and
agent therefor, shall: (a) prepare and file, or cause to be prepared and filed,
federal tax returns (as well as any other federal and state information and
other returns) using a calendar year as the taxable year when and as required by
the REMIC Provisions; (b) make (or cause

                                       51
<PAGE>

to be made) an election, on behalf of each of REMIC I and REMIC II, to be
treated as a REMIC on the Federal tax return and any applicable state or local
returns for the first taxable year, in accordance with the REMIC Provisions; (c)
prepare and forward, or cause to be prepared and forwarded, to the
Certificateholders all information reports (including, without limitation, the
information required in connection with the computation of the present value of
anticipated excess inclusions as required by ss. 1.860E-2(a)(5) of the REMIC
Provisions) as and when required to be provided to them in accordance with the
REMIC Provisions; (d) conduct the affairs of the Trust Fund at all times that
REMIC I Regular Interests or REMIC II Certificates are outstanding so as to
maintain the status of each of REMIC I and REMIC II as a REMIC under the REMIC
Provisions; and (e) not knowingly or intentionally take any action or omit to
take any action that would cause the termination of the REMIC status of either
REMIC I or REMIC II.

      The Servicer may enter into sub-servicing agreements with third parties
with respect to any of its respective rights and obligations hereunder,
provided, that any such agreement shall be consistent with the provisions of
this Agreement. Any such sub-servicing agreement may permit the sub-servicer to
delegate its rights and duties to agents or subcontractors so long as the
related agreements or arrangements with such agents or subcontractors are
consistent with the provisions of Section 3.1(c). As long as the Servicer has
any obligations to service the Loans hereunder (and it has not assigned such
obligations pursuant to Section 3.1(c)), the Loans shall be serviced by a FNMA
approved lender or a FHLMC seller/servicer in good standing.

      Any sub-servicing agreement, and any other transactions or services
relating to the Loans involving a sub-servicer, including (if applicable) the
Depositor in its capacity as sub-servicer under a sub-servicing agreement and
not in its capacity as a party to this Agreement, shall be deemed to be between
the Servicer and such sub-servicer (including the Depositor) alone, and the
Trustee and the Certificateholders shall not be deemed parties thereto and shall
have no claims, rights, obligations, duties or liabilities with respect to the
sub-servicer, except as set forth in Section 3.1(d).

      In the event that the Trustee assumes the servicing obligations of the
Servicer (including by reason of an Event of Default which is not cured by the
Servicer within the time permitted hereunder), upon request of the Trustee, the
Servicer shall at its own expense deliver to the Trustee all documents and
records relating to any sub-servicing agreement and the Loans then being
serviced thereunder and an accounting of amounts collected and held by it, if
any, and will otherwise use its best efforts to effect the orderly and efficient
transfer of any sub-servicing agreement to the Trustee.

      (c) Costs incurred by the Servicer in effectuating the timely payment of
taxes and assessments on the Mortgaged Property securing a Mortgage Note shall
be recoverable by the Servicer pursuant to Section 3.3. The Servicer shall
ensure all such taxes and assessments are timely paid.

      The Servicer, as initial servicer, shall pay all of its costs and proven
damages incurred with respect to or arising out of any allegation of impropriety
in its servicing of the Loans. Further, the

                                       52
<PAGE>

Servicer shall not be entitled to reimbursement or indemnification from either
the Trust Fund or the Certificateholders with respect to any such costs, claims
and damages.

      (d) Notwithstanding any sub-servicing agreement, any of the provisions of
this Agreement relating to agreements or arrangements between the Servicer and
any Person (including the Depositor) acting as sub-servicer (or its agents or
subcontractors) or any reference to actions taken through any Person (including
the Depositor) acting as sub-servicer or otherwise, the Servicer shall remain
obligated and primarily liable to the Trustee and Certificateholders for the
servicing and administering of the Loans in accordance with the provisions of
this Agreement without diminution of such obligation or liability by virtue of
such sub-servicing agreements or arrangements or by virtue of indemnification
from the Depositor or any other Person acting as sub-servicer (or its agents or
subcontractors) to the same extent and under the same terms and conditions as if
the Servicer alone were servicing and administering the Loans. The Servicer
shall be entitled to enter into an agreement with any sub-servicer providing for
indemnification of the Servicer by such sub-servicer (including the Depositor
and the Trustee), and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification, but no such agreement for indemnification
shall be deemed to limit or modify this Agreement.

      Section 3.2 Collection of Certain Loan Payments; Custodial Account for
P&I.

      (a) The Servicer shall make reasonable efforts to collect all payments
called for under the terms and provisions of the Loans, and shall, to the extent
such procedures shall be consistent with this Agreement, follow such collection
procedures as it follows with respect to conventional mortgage loans it services
for itself and any of its Affiliates; provided, however, that the Servicer
agrees not to permit any modification with respect to any Loan that would change
the manner in which the Mortgage Interest Rate is computed, forgive any
principal or interest or change the term of such Loan. Consistent with the
foregoing, the Servicer may in its discretion (i) waive any assumption fee, late
payment charge or other charge in connection with a Loan, and (ii) arrange a
schedule, running for no more than 180 days after the scheduled Due Date, for
payment of any installment on any Mortgage Note or after the due date of any
other payment due under the related Mortgage Note for the liquidation of
delinquent items, provided, that the Servicer shall continue to be obligated to
make Advances in accordance with Section 4.3 during the continuance of such
period. With respect to any Loans which provide for the right of the holder
thereof to call for early repayment thereof at times specified therein, neither
the Trustee nor the Servicer shall exercise any such right, except that the
Trustee shall exercise such right at the written direction of the Servicer set
forth in an Officer's Certificate in connection with a default under the related
Note. Notwithstanding anything herein to the contrary, neither the Servicer nor
any other party may take any action that would cause a "significant
modification" of any Loan within the meaning of the REMIC Provisions that would
cause REMIC I or REMIC II to fail to qualify as a REMIC at any time or cause a
tax to be imposed on the Trust Fund under the REMIC Provisions.

      (b) The Servicer shall establish and maintain one or more separate
accounts as set forth in Article I (collectively, the "Custodial Account for
P&I"), and shall on the Closing Date credit any

                                       53
<PAGE>

amounts representing scheduled payments of principal and interest due after the
Cut-off Date but received by the Servicer on or before the Closing Date, and
thereafter on a daily basis the following payments and collections received or
made by it (other than in respect of principal of and interest on the Loans due
on or before the Cut-off Date):

            (i) All Mortgagor payments on account of principal, including
      Principal Prepayments on the Loans;

            (ii) All Mortgagor payments on account of interest on the Loans,
      which may be net of that portion thereof which the Servicer is entitled to
      retain as Servicing Fees (adjusted for any amounts related to Compensating
      Interest) or other servicing compensation (including any prepayment
      penalties) pursuant to Section 3.9, as adjusted pursuant to Section 4.6;

            (iii) All net Liquidation Proceeds;

            (iv) All Insurance Proceeds received by the Servicer, other than
      proceeds to be applied to the restoration or repair of the property
      subject to the related Mortgage or released to the Mortgagor in accordance
      with the Servicer's normal servicing procedures, and all amounts deposited
      by the Servicer with respect to the failure to maintain flood or fire and
      hazard insurance policies, pursuant to Section 3.5;

            (v) All repurchase proceeds from the repurchase of a Loan pursuant
      to a Purchase Obligation;

            (vi) any amounts required to be deposited pursuant to Section 3.2(c)
      in connection with net losses realized on Eligible Investments with
      respect to funds held in the Custodial Account for P&I;

            (vii) all income and gain realized from any investment of the funds
      in the Custodial Account for P&I in Eligible Investments;

            (viii) all net income from the renting of REO Property pursuant to
      Section 3.7(c); and

            (ix) All other amounts required to be deposited in the Custodial
      Account for P&I pursuant to this Agreement.

      (c) The Servicer may invest the funds in the Custodial Account for P&I in
Eligible Investments which shall mature not later than the Business Day
preceding the next Distribution Date unless the Custodial Account for P&I is
maintained with the Trustee in which case they may mature on the Distribution
Date. The Eligible Investments may not be sold or disposed of prior to their
maturity. All such Eligible Investments shall be made in the name of the
Servicer (in its capacity as

                                       54
<PAGE>

such) or its nominee. All income and gain realized from any such investment
shall be for the benefit of the Servicer, and shall be payable to the Servicer.
The amount of any losses incurred in respect of any such investments shall be
deposited in the Custodial Account for P&I by the Servicer, out of its own funds
immediately as realized without right to reimbursement therefor.

      (d) The foregoing requirements for deposit in the Custodial Account for
P&I shall be exclusive, it being understood and agreed that, without limiting
the generality of the foregoing, payments in the nature of those described in
the last paragraph of this Section 3.2 and payments in the nature of late
payment charges or assumption fees need not be deposited by the Servicer in the
Custodial Account for P&I. All funds deposited by the Servicer in the Custodial
Account for P&I shall be held by it in trust in the Custodial Account for P&I
until disbursed in accordance with Section 4.1 or withdrawn in accordance with
Section 3.3; provided, however, that the Servicer shall withdraw such funds and
deposit them in such manner as to not result in a downgrading or withdrawal of
the rating then assigned to the Certificates by each Rating Agency. If the
Servicer deposits in the Custodial Account for P&I any amount not required to be
deposited therein, it may at any time withdraw such amount from the Custodial
Account for P&I pursuant to Section 3.3(i) of this Agreement.

      Certain of the Loans may provide for payment by the Mortgagor of amounts
to be used for payment of taxes, assessments, hazard or other insurance premiums
or comparable items for the account of the Mortgagor. The Servicer may deal with
these amounts in accordance with its normal servicing procedures and pursuant to
Section 3.4 of this Agreement.

      Section 3.3 Permitted Withdrawals from the Custodial Account for P&I.

      The Servicer may, from time to time, make withdrawals from the Custodial
Account for P&I for the following purposes:

      (a) to reimburse itself for Advances made by or on behalf of it pursuant
to Section 3.4 or 4.3, the Servicer's right to reimburse itself pursuant to this
subclause (a) being limited to (i) amounts received on or in respect of
particular Loans (including, for this purpose, Liquidation Proceeds and
Insurance Proceeds which represent late recoveries of payments of principal
and/or interest respecting which any such Advance was made and any net income
received from the renting of REO Property pursuant to Section 3.7(c)) and (ii)
amounts in the Custodial Account for P&I held for future distribution or
withdrawal, such amounts referred to in clause (ii) of this subclause (a) to be
replaced by the Servicer to the extent that funds in the Custodial Account for
P&I on a future Withdrawal Date are less than the payment required to be made to
the Certificate Account therefrom as of such future Distribution Date;

      (b) (i) to reimburse itself from Liquidation Proceeds for Liquidation
Expenses, (ii) for amounts expended by it pursuant to Section 3.7 in good faith
in connection with the restoration of damaged property and (iii) to the extent
that Liquidation Proceeds after such reimbursement are in excess of the
Principal Balance of the related Loan together with accrued and unpaid interest
thereon

                                       55
<PAGE>

at the applicable Pass-Through Rate to the date of such liquidation, net of any
related Advances which were unreimbursed prior to the receipt of such
Liquidation Proceeds, to pay to itself any unpaid Servicing Fees, and any
assumption fees, late payment charges or other Mortgage charges on the related
Loan;

      (c) to pay to itself from any Mortgagor payment as to interest or other
recovery with respect to a particular Loan, to the extent permitted by this
Agreement, that portion of any payment as to interest in excess of interest at
the applicable Pass-Through Rate which the Servicer is entitled to retain as
Servicing Fees pursuant to Section 3.9 or otherwise;

      (d) to reimburse itself for expenses incurred by and recoverable by or
reimbursable to it pursuant to Section 3.1 or 3.5 after the related Mortgagor
has reimbursed the Trust Fund for such expenses or following liquidation of the
related Loan, or pursuant to Section 6.3;

      (e) to pay to itself with respect to each Loan or property acquired in
respect thereof that has been repurchased pursuant to Section 2.2 or 2.3 or
purchased by the Servicer pursuant to Section 9.1 all amounts received thereon
and not distributed as of the date on which the related Principal Balance is
determined;

      (f) to reimburse itself for any Nonrecoverable Advances;

      (g) to disburse to the Trustee in order that the Trustee may make payments
to Certificateholders in the amounts and in the manner provided for in Section
4.1;

      (h) to pay itself any net interest or other income earned and received on
or investment income received with respect to funds in the Custodial Account for
P&I; and

      (i) to make payments to itself or others pursuant to any provision of this
Agreement and to remove any amounts not required to be deposited therein and to
clear and terminate the Custodial Account for P&I pursuant to Section 9.1.

      Since in connection with withdrawals pursuant to subclauses (a), (b), (c)
and (e) the Servicer's entitlement thereto is limited to collections or other
recoveries on the related Loan, the Servicer shall keep and maintain a separate
accounting for each Loan for the purpose of justifying any withdrawal from the
Custodial Account for P&I pursuant to such subclauses.

      The Servicer shall make the withdrawal referred to in subclause (g) above
and shall deposit the amount so withdrawn into the Certificate Account prior to
4:00 P.M. New York City time on each related Withdrawal Date.

      The Servicer may establish, or cause to be established, two or more
Custodial Accounts for P&I into which funds collected by the Servicer or its
subservicers in connection with the Loans may be

                                       56
<PAGE>

deposited. Funds collected in connection with mortgage loans other than the
Loans may also be deposited in the Custodial Accounts for P&I and comingled with
collections on the Loans. The Servicer may, in its discretion, withdraw funds
from one Custodial Account for P&I and deposit such funds into another Custodial
Account for P&I prior to the date such funds must be deposited in the
Certificate Account.

      Section 3.4 Taxes, Assessments and Similar Items; Escrow Accounts.

      (a) The Servicer shall establish and maintain one or more accounts (each,
an "Escrow Account") into which all Escrow Payments shall be deposited and in
which all Escrow Payments shall be retained. Escrow Accounts shall be Eligible
Accounts, and funds in the Escrow Account may be invested in Eligible
Investments. Withdrawals of amounts from an Escrow Account may be made only to:
(i) effect payment of taxes, assessments, insurance premiums and comparable
items; (ii) refund to Mortgagors any sums that are determined to be overages;
(iii) reimbursement to the Servicer for any cost incurred in paying taxes,
insurance premiums and assessments or comparable items; (iv) pay interest, if
required and as described below, to Mortgagors on balances in the Escrow
Account; (v) withdraw interest or other income which may lawfully be retained by
the Trust Fund, for deposit into the Certificate Account; or (vi) clear and
terminate the Escrow Account at the termination of this Agreement in accordance
with Section 9.1. Unless otherwise required by applicable law, any interest
earned on funds in Escrow Accounts shall be remitted to the related Mortgagors
if required by the related Mortgage Note or otherwise to the Servicer as
additional servicing compensation.

      (b) With respect to each Loan, the Servicer shall maintain, or cause to be
maintained, accurate records with respect to each related Mortgaged Property
reflecting the status of taxes, assessments and other similar items that are or
may become a lien on the related Mortgaged Property and the status of insurance
premiums payable with respect thereto. The Servicer shall require that payments
for taxes, assessments, insurance premiums and other similar items be made by
the Mortgagor at the time they first become due. If a Mortgagor fails to make
any such payment on a timely basis, the Servicer shall advance, or cause to be
advanced, the amount of any shortfall unless the Servicer determines in its good
faith judgment that such advance would not be ultimately recoverable from future
payments and collections on the related Loan (including without limitation
Insurance Proceeds and Liquidation Proceeds), or otherwise. The Servicer shall
be entitled to reimbursement of advances made pursuant to the preceding
sentence, together with interest thereon at the Federal Funds Rate, from amounts
received on or in respect of the related Loan respecting which such advance was
made or if such advance has become nonrecoverable, in either case to the extent
permitted by Section 3.3 of this Agreement. No costs incurred by the Servicer in
effecting the payment of taxes and assessments on the Mortgaged Properties
shall, for the purpose of calculating distributions to Certificateholders, be
added to the amount owing under the related Loans, notwithstanding that the
terms of such Loans so permit.

      The Servicer may establish, or cause to be established, two or more Escrow
Accounts into which funds collected by the Servicer or its subservicers in
connection with the Loans may be deposited. Funds collected in connection with
mortgage loans other than the Loans may also be

                                       57
<PAGE>

deposited in the Escrow Accounts and comingled with collections on the Loans.
The Servicer may, in its discretion, withdraw funds from one Escrow Account and
deposit such funds into another Escrow Account prior to the date such funds must
be used to make Escrow Payments.

      Section 3.5 Maintenance of Insurance.

      The Servicer shall also cause to be maintained for each Loan fire and
hazard insurance with extended coverage as is customary in the area where the
Mortgaged Property is located in an amount which is at least equal to the lesser
of (i) the Principal Balance of such Loan or (ii) the replacement value costs of
improvements securing such Loan. The Servicer shall cause to be maintained fire
and hazard insurance with extended coverage on each REO Property in an amount
which is at least equal to the greater of (i) an amount not less than is
necessary to avoid the application of any co-insurance clause contained in the
related fire and hazard insurance policy or (ii) the replacement cost of the
improvements which are a part of such property. The Servicer shall also cause to
be maintained for each Loan with a Loan-to-Value Ratio greater than 80% a
primary mortgage insurance policy which will cover at least 75% of the original
fair market value of the related Mortgaged Property until such time as the
principal balance of such Loan is reduced to 80% of the current fair market
value or otherwise in accordance with applicable law. The Servicer on behalf of
the Trustee as Mortgagee shall maintain or cause the related Mortgagor to
maintain for each Loan such other insurance on the related Mortgaged Property as
may be required by the terms of the related Mortgage Note. If the Mortgaged
Property is in an area identified in the Federal Register by the Flood Emergency
Management Agency as having special flood hazards the Servicer will cause to be
maintained a flood insurance policy meeting the requirements of the current
guidelines of the Federal Insurance Administration with a generally acceptable
insurance carrier, in an amount representing coverage not less than the least of
(i) the full insurable value, (ii) the maximum amount of insurance which is
available under the Flood Disaster Protection Act of 1973, and (iii) the
Principal Balance of the related Loan. The Servicer shall also maintain fire and
hazard insurance with extended coverage and, if applicable, flood insurance on
property acquired upon foreclosure, or by deed in lieu of foreclosure, of any
Loan in an amount that is at least equal to the lesser of (i) the maximum
insurable value of the improvements which are a part of such property and (ii)
the principal balance owing on such Loan at the time of such foreclosure or
grant of deed in lieu of foreclosure plus accrued interest and related
Liquidation Expenses. If an REO Property was located at the time of origination
of the related Loan in a federally designated special flood hazard area, the
Servicer will obtain flood insurance in respect thereof providing substantially
the same coverage as described in the preceding sentence. If at any time during
the term of this Agreement a recovery under a flood or fire and hazard insurance
policy in respect of an REO Property is not available but would have been
available if such insurance were maintained thereon in accordance with the
standards applied to Mortgaged Properties described herein, the Servicer shall
either (i) immediately deposit into the Custodial Account for P&I from its own
funds the amount that would have been recovered or (ii) apply to the restoration
and repair of the property from its own funds the amount that would have been
recovered, if such application would be consistent with the servicing standard
set forth in Section 3.1. It is understood and agreed that such insurance shall
be with insurers approved by the Servicer and that no earthquake or other
additional insurance is to be required of any Mortgagor, other than pursuant to

                                       58
<PAGE>

such applicable laws and regulations or policies of the Servicer as shall at any
time be in force and as shall require such additional insurance. Pursuant to
Section 3.2, any amounts collected by the Servicer under any insurance policies
maintained pursuant to this Section 3.5 (other than amounts to be applied to the
restoration or repair of the property subject to the related Mortgage or
released to the Mortgagor in accordance with the Servicer's normal servicing
procedures) shall be deposited into the Custodial Account for P&I, subject to
withdrawal pursuant to Section 3.3. Any cost incurred by the Servicer in
maintaining any such insurance shall be recoverable by the Servicer pursuant to
Section 3.3. In the event that the Servicer shall obtain and maintain a blanket
policy issued by an insurer that qualifies under the guidelines set forth for
the Servicer by FNMA or FHLMC, insuring against hazard losses on all of the
Loans, then, to the extent such policy provides coverage in an amount equal to
the unpaid principal balance on the Loans without co-insurance and otherwise
complies with all other requirements set forth in the first paragraph of this
Section 3.5, it shall conclusively be deemed to have satisfied its obligation as
set forth in such first paragraph, it being understood and agreed that such
policy may contain a deductible clause, in which case the Servicer shall, in the
event that there shall not have been maintained on the related mortgaged or
acquired property an insurance policy complying with the first paragraph of this
Section 3.5 and there shall have been a loss which would have been covered by
such a policy had it been maintained, be required to deposit from its own funds
into the Custodial Account for P&I or apply to the restoration of the property
the amount not otherwise payable under the blanket policy because of such
deductible clause.

      The Servicer shall obtain and maintain at its own expense throughout the
term of this Agreement a blanket fidelity bond and an errors and omissions
insurance policy with broad coverage with responsible companies covering the
Servicer's officers and employees and other persons acting on behalf of the
Servicer in connection with its activities under this Agreement. Any such
fidelity bond and errors and omissions insurance shall provide an amount of
coverage and will maintain such coverage at a level which will permit the
Servicer to continue to be a FNMA or a FHLMC-qualified Servicer and shall
protect and insure the Servicer against losses, including forgery, theft,
embezzlement, fraud, errors and omissions and negligent acts of such persons. No
provision of this Section 3.5 requiring such fidelity bond and errors and
omissions insurance shall diminish or relieve the Servicer from its duties and
obligations as set forth in this Agreement.

      Section 3.6 Enforcement of Due-on-Sale Clauses; Assumption and
Substitution Agreements.

      In any case in which property subject to a Mortgage is conveyed by the
Mortgagor, the Servicer will enforce any due-on-sale clause contained in the
related Mortgage Note or Mortgage, to the extent permitted under applicable law
and governmental regulations, but only to the extent that such enforcement will
not adversely affect or jeopardize coverage under any related insurance policy
or result in legal action by the Mortgagor. Subject to the foregoing, the
Servicer is authorized to take or enter into an assumption or substitution
agreement from or with the Person to whom such property has been or is about to
be conveyed. The Servicer is also authorized to release the original Mortgagor
from liability upon the Loan and substitute the new Mortgagor as obligor
thereon. In connection with

                                       59
<PAGE>

such assumption or substitution, the Servicer shall apply such underwriting
standards and follow such practices and procedures as shall be normal and usual
and as it applies to mortgage loans owned solely by it or any of its Affiliates.
The Servicer shall notify the Trustee that any such assumption or substitution
agreement has been completed by forwarding to the Trustee the original copy of
such assumption or substitution agreement, which copy shall be added by the
Trustee to the related Mortgage File and shall, for all purposes, be considered
a part of such Mortgage File to the same extent as all other documents and
instruments constituting a part thereof. In connection with any such assumption
or substitution agreement, the interest rate of the related Mortgage Note shall
not be changed. Any fee collected by the Servicer for entering into an
assumption or substitution of liability agreement will be retained by the
Servicer as servicing compensation.

      Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any conveyance by the
Mortgagor of the Mortgaged Property or any assumption of a Loan by operation of
law which the Servicer in good faith determines it may be restricted by law from
preventing, for any reason whatsoever.

      Section 3.7 Realization upon Defaulted Loans.

      (a) Consistent with the servicing standard set forth in Section 3.1 and
with a view to the best economic interest of the Trust Fund, the Servicer shall
foreclose upon or otherwise comparably convert (which may include acquisition of
an REO Property) the Mortgaged Properties securing such of the Loans as come
into and continue in default and as to which no satisfactory arrangements can be
made for collection of delinquent payments pursuant to Section 3.2. In
connection with such foreclosure or other conversion, the Servicer shall follow
such practices and procedures as it shall deem necessary or advisable and as
shall be normal and usual in its general mortgage servicing activities. The
foregoing is subject to the proviso that the Servicer shall not be required to
expend its own funds in connection with any foreclosure or to restore any
damaged property unless it shall determine (i) that such foreclosure and/or
restoration expenses will increase the Liquidation Proceeds to
Certificateholders after reimbursement to itself for such expenses and (ii) that
such expenses will be recoverable to it through Liquidation Proceeds (respecting
which it shall have priority for purposes of withdrawal from the Custodial
Account for P&I pursuant to Section 3.3). Any gain on foreclosure or other
conversion of a Liquidated Loan shall be distributed to the Class R
Certificateholder, but only to the extent that such gain is not necessary to
make distributions to the Certificateholders of the other Classes of
Certificates. The Servicer shall be responsible for all other costs and expenses
incurred by it in any such proceedings; provided, however, that it shall be
entitled to reimbursement thereof (as well as any Servicing Fees and other
amounts due it, if any), to the extent, but only to the extent, that withdrawals
from the Custodial Account for P&I with respect thereto are permitted under
Section 3.3. Within 30 days after receipt of Liquidation Proceeds in respect of
a Liquidated Loan, the Servicer shall provide to the Trustee a statement of
accounting for the related Liquidated Loan, including without limitation (i) the
Loan number, (ii) the date the Loan was acquired in foreclosure or deed in lieu,
and the date the Loan became a Liquidated Loan, (iii) the gross sales price and
the related selling and other expenses, (iv) accrued interest calculated from

                                       60
<PAGE>

the foreclosure date to the liquidation date, and (v) such other information as
the Trustee may reasonably specify.

      (b) Prior to any such foreclosure, the Servicer may, at its option,
repurchase any Loan which is 90 days or more delinquent and which the Servicer
determines in good faith would otherwise become subject to foreclosure
proceedings or any Loan as to which the Mortgagor tenders a deed in lieu of
foreclosure at a price equal to the outstanding Principal Balance of the Loan
plus accrued interest at the applicable Pass-Through Rate to the next Due Date.
Any such repurchase shall be deemed a Principal Prepayment for purposes of this
Agreement and all amounts in respect thereof shall be deposited into the
Custodial Account for P&I pursuant to Section 3.2(b).

      (c) The Trust Fund shall not acquire any real property (or personal
property incident to such real property) except in connection with a default or
imminent default of a Loan. Based on a report prepared by an Independent Person
who regularly conducts environmental audits that the Mortgaged Property for
which foreclosure proceedings are contemplated is not in compliance with
applicable environmental laws, or there are circumstances present at such
Mortgaged Property relating to the use, management or disposal of any hazardous
materials, wastes, or petroleum based materials for which investigation,
testing, monitoring, containment, clean-up or remediation could be required
under any federal, state or local law or that it would not be in the best
economic interest of the Trust Fund to acquire title to such Mortgaged Property
and further to take such actions as would be necessary and appropriate to effect
such compliance and/or respond to such circumstances, the Servicer will not
conduct such foreclosure proceedings. If the Servicer otherwise becomes aware,
under its customary servicing procedures, of an environmental hazard with
respect to a Loan for which foreclosure proceedings are contemplated, the
Servicer will not conduct such foreclosure proceedings unless it determines in
good faith that the liability associated with the environmental hazard will be
less than the Liquidation Proceeds to be realized from the sale of the related
Mortgaged Property. In the event that the Trust Fund acquires any real property
(or personal property incident to such real property) in connection with a
default or imminent default of a Loan, such REO Property shall be disposed of by
the Trust Fund within three years after its acquisition by the Trust Fund unless
the Trustee shall have received from the Servicer an Opinion of Counsel to the
effect that the holding by the Trust Fund of such REO Property subsequent to
three years after its acquisition will not cause REMIC I or REMIC II to fail to
qualify as a REMIC under the REMIC Provisions at any time that any REMIC I
Regular Interests or Certificates are outstanding, in which case such REO
Property shall be disposed of as soon as possible by the Trust Fund but in no
event shall be held longer than the maximum period of time during which the
Trust Fund is then permitted to hold such REO Property and allow REMIC I and
REMIC II to remain qualified as REMICs under the REMIC Provisions. The Servicer
shall manage, conserve, protect and operate each such REO Property for the
Certificateholders solely for the purpose of its prompt disposition and sale in
a manner which does not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code.
Pursuant to its efforts to sell such REO Property, the Servicer shall either
itself or through an agent selected by the Servicer protect and conserve such
REO Property in the same manner and to such extent as is customary in the
locality where such property is located and may, incident to its conservation
and protection of the interests of the

                                       61
<PAGE>

Certificateholders, rent the same, or any part thereof, as the Servicer deems to
be in the best interest of the Servicer and the Certificateholders for the
period prior to the sale of such REO Property. All proceeds from the renting of
such REO Property shall, net of any costs or expenses of the Servicer in
connection therewith, be deposited into the Custodial Account for P&I pursuant
to Section 3.3(b)(ix).

      (d) In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be issued to the Trustee, or to its nominee on behalf of
Certificateholders. Notwithstanding any such acquisition of title and
cancellation of the related Loan, such Loan shall (except for purposes of
Section 9.1) be considered to be a Loan held in the Trust Fund until such time
as the related REO Property shall be sold by the Trust Fund and shall be reduced
only by collections net of expenses. Consistent with the foregoing, for purposes
of all calculations hereunder, so long as such Loan shall be considered to be an
outstanding Loan, it shall be assumed that, notwithstanding that the
indebtedness evidenced by the related Mortgage Note shall have been discharged,
such Mortgage Note and, for purposes of determining the Scheduled Principal
Balance thereof, the related amortization schedule in effect at the time of any
such acquisition of title remain in effect.

      (e) The Servicer shall not acquire for the benefit of the Trust Fund any
personal property pursuant to this Section 3.7 unless either:

            (i) such personal property is incident to real property (within the
      meaning of Section 856(e)(1) of the Code) so acquired by the Servicer for
      the benefit of the Trust Fund; or

            (ii) the Servicer shall have requested and received an Opinion of
      Counsel (which opinion shall be an expense of the Trust Fund) to the
      effect that the holding of such personal property by the Trust Fund will
      not cause the imposition of a tax on the Trust Fund under the REMIC
      Provisions or cause REMIC I or REMIC II to fail to qualify as a REMIC at
      any time that any Certificate is outstanding.

      Section 3.8 Trustee to Cooperate; Release of Mortgage Files.

      Upon the payment in full of any Loan, or the receipt by the Servicer of a
notification that the payment in full will be escrowed in a manner customary for
such purposes, the Servicer will immediately notify the Trustee and the
Custodian by an Officer's Certificate (which Officer's Certificate shall include
a statement to the effect that all amounts received in connection with such
payment which are required to be deposited in the Custodial Account for P&I
pursuant to Section 3.2 have been or will be so deposited) and shall by such
Officer's Certificate request delivery to it of the Mortgage File. Upon receipt
of such Officer's Certificate and request, the Trustee or the Custodian, as
applicable, shall, not later than the 5th succeeding Business Day, release or
cause to be released the related Mortgage File to the Servicer. Upon the
Trustee's or the Custodian's receipt of any release or reconveyance documents or
instruments relating to a Loan paid in full, the Trustee

                                       62
<PAGE>

or the Custodian, as the case may be, shall, not later than the 5th succeeding
Business Day, execute and return such documents and instruments to the Servicer.
From time to time and as appropriate for the servicing or foreclosure of any
Loan, the Custodian shall, upon written request of the Servicer and delivery to
the Custodian, as applicable, of a trust receipt signed by a Servicing Officer,
release or cause to be released, not later than the 5th succeeding Business Day,
the related Mortgage File to the Servicer and shall execute such documents
furnished to it as shall be necessary to the prosecution of any such
proceedings. Such trust receipt shall obligate the Servicer to return each and
every document previously requested from the Mortgage File to the Custodian, as
applicable, when the need therefor by the Servicer no longer exists unless the
Loan shall be liquidated, in which case, upon receipt of a certificate of a
Servicing Officer similar to that hereinabove specified, the trust receipt shall
be released by the Custodian to the Servicer by delivery to a Servicing Officer
and the Custodian shall have no further responsibility with respect to such
Mortgage Files.

      Section 3.9 Servicing Compensation.

      The Servicer shall be entitled to retain or, if not retained, to withdraw
from the Certificate Account or the Custodial Account for P&I as servicing
compensation its Servicing Fee out of each payment on account of interest on
each Loan, subject to adjustment as provided in Section 4.6. The Servicer shall
also be entitled to payment of unpaid Servicing Fees with respect to a
delinquent Loan out of Liquidation Proceeds with respect to such Loan, to the
extent permitted by Section 3.3(b). Servicing compensation in the form of
assumption fees, late payment charges or otherwise shall be retained by the
Servicer and need not be deposited in the Custodial Account for P&I. The
Servicer shall also be entitled to additional servicing compensation out of
Liquidation Proceeds to the extent provided in Section 3.3(b). The Servicer
shall be required to pay all expenses incurred by it in connection with its
servicing activities hereunder (including maintenance of the blanket fidelity
bond and errors and omissions policy required by Section 3.5) and shall not be
entitled to reimbursement therefor except as specifically provided in Sections
3.1, 3.3, 3.5 and 3.7.

      Section 3.10 Reports to the Trustee.

      On or before 12:00 noon (New York City time) on the second Business Day
prior to each Distribution Date, the Servicer shall deliver or cause to be
delivered to the Trustee or its designee a statement in electronic or written
form as may be agreed upon by the Servicer and the Trustee containing the
information described in Section 4.2 and such other information as may be
necessary for the Trustee to distribute the amounts to be distributed to the
Certificateholders by the Trustee (the "Servicer's Section 3.10 Report"). Not
later than 25 days after each Distribution Date, the Servicer shall forward or
cause to be forwarded to the Trustee a statement, certified by a Servicing
Officer, as to the Certificate Account as of the close of business on the
related Distribution Date, stating that all distributions into the Certificate
Account required to be made by this Agreement have been made for the period
covered by such statement (or if any required distribution has not been made,
specifying the nature and status thereof) and showing, for the period covered by
such statement, the aggregate of deposits into the Certificate Account and
withdrawals from the Custodial Account for P&I, for each category of deposit
specified in Section 3.2 and each category of withdrawal specified

                                       63
<PAGE>

in Section 3.3. Such statement shall also include information as to the
aggregate Principal Balance of all of the Loans as of the last day of the
calendar month immediately preceding such Distribution Date. Copies of such
statement shall be provided to any Certificateholder upon request by the
Servicer, or by the Trustee so long as the Trustee has received the report as
stipulated above at the Servicer's expense if the Servicer shall fail to provide
such copies.

      Section 3.11 Annual Statement as to Compliance.

      Not later than the earlier of (a) March 15 of each calendar year (other
than the calendar year during which the Closing Date occurs) or (b) with respect
to any calendar year during which the Depositor's annual report on Form 10-K is
required to be filed in accordance with the Exchange Act and the rules and
regulations of the Commission, 15 calendar days before the date on which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Commission (or, in
each case, if such day is not a Business Day, the immediately preceding Business
Day), the Servicer will deliver to the Trustee an Officer's Certificate stating
as to each signer thereof, that (i) a review of the activities of the Servicer
during the preceding calendar year and of performance under this Agreement has
been made under such officer's supervision, and (ii) to the best of such
officer's knowledge, based on such review, the Servicer has fulfilled all of its
obligations under this Agreement throughout such year, or if there has been a
default in the fulfillment of any such obligation, specifying each such default
known to such officer and the nature and status thereof. Copies of such
statement shall be provided to each Rating Agency and to any Certificateholder
upon request by the Servicer, or by the Trustee at the Servicer's expense.

      Section 3.12 Annual Independent Public Accountants' Servicing Report.

      Not later than the earlier of (a) March 15 of each calendar year (other
than the calendar year during which the Closing Date occurs) or (b) with respect
to any calendar year during which the Depositor's annual report on Form 10-K is
required to be filed in accordance with the Exchange Act and the rules and
regulations of the Commission, 15 calendar days before the date on which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Commission (or, in
each case, if such day is not a Business Day, the immediately preceding Business
Day), the Servicer, at its expense, shall cause a firm of independent public
accountants who are members of the American Institute of Certified Public
Accountants to furnish a statement to the Trustee to the effect that, in
connection with the firm's examination of the financial statements as of the
previous December 31 of the Servicer's parent corporation (which shall include a
limited examination of the Servicer's financial statements), nothing came to
their attention that indicated that the Servicer was not in compliance with
Section 3.02, Section 3.03, Section 3.04, Section 3.05, Section 3.11, Section
3.12 and Section 3.13 of this Agreement, except for (i) such exceptions as such
firm believes to be immaterial, and (ii) such other exceptions as are set forth
in such statement. Copies of such statement shall be provided to
Certificateholders upon request by the Servicer, or by the Trustee at the
Servicer's expense.

                                       64
<PAGE>

      Section 3.13 Access to Certain Documentation and Information Regarding the
Loans.

      The Servicer shall provide access to the Trustee or to its designees at
its request, and to Certificateholders which are savings and loan associations,
banks or insurance companies, the OTS, the FDIC and the supervisory agents and
examiners of the OTS and the FDIC or examiners of any other federal or state
banking or insurance regulatory authority to the documentation regarding the
Loans if so required by applicable regulations of the OTS or other regulatory
authority, such access to be afforded without charge but only upon reasonable
request and during normal business hours at the offices of the Servicer
designated by it. The Trustee or its designee may without charge copy any
document or electronic record maintained by the Servicer hereunder.

      Section 3.14 [Reserved].

      Section 3.15 Sale of Defaulted Loans and REO Properties.

      (a) With respect to any Defaulted Loan or REO Property which the Servicer
has determined to sell in accordance with the standards set forth in Section
3.7, the Servicer shall deliver to the Trustee an Officer's Certificate to the
effect that no satisfactory arrangements can be made for collection of
delinquent payments thereon pursuant to Section 3.2, and, consistent with the
servicing standard set forth in Section 3.1 and with a view to the best economic
interest of the Trust Fund, the Servicer has determined to sell such Defaulted
Loan or REO Property in accordance with this Section 3.15. The Servicer may then
offer to sell to any Person any Defaulted Loan or any REO Property or, subject
to the following sentence, purchase any such Defaulted Loan or REO Property (in
each case at the Purchase Price therefor), but shall in any event, so offer to
sell any REO Property no later than the time determined by the Servicer to be
sufficient to result in the sale of such REO Property within the period
specified in Section 3.7(c). The Servicer shall accept the highest bid received
from any Person for any Defaulted Loan or any REO Property in an amount at least
equal to the Purchase Price therefor or, at its option, if it has received no
bid at least equal to the Purchase Price therefor, purchase the Defaulted Loan
or REO Property at the Purchase Price.

      In the absence of any such bid or purchase by the Servicer, the Servicer
shall accept the highest bid received from any Person that is determined by the
Servicer to be a fair price for such Defaulted Loan or REO Property, if the
highest bidder is a Person other than an Interested Person, or is determined to
be such a price by the Trustee, if the highest bidder is an Interested Person.
Notwithstanding anything to the contrary herein, neither the Trustee, in its
individual capacity, nor any of its Affiliates may bid for or purchase any
Defaulted Loan or any REO Property pursuant hereto.

      The Servicer shall not be obligated by either of the foregoing paragraphs
or otherwise to accept the highest bid if the Servicer determines, in accordance
with the servicing standard stated in Section 3.1, that rejection of such bid
would be in the best interests of the Certificateholders. In addition, the
Servicer may accept a lower bid if it determines, in accordance with the
servicing standard stated in Section 3.1, that acceptance of such bid would be
in the best interests of the

                                       65
<PAGE>

Certificateholders (for example, if the prospective buyer making the lower bid
is more likely to perform its obligations, or the terms offered by the
prospective buyer making the lower bid are more favorable). In the event that
the Servicer determines with respect to any REO Property that the bids being
made with respect thereto are not in the best interests of the
Certificateholders and that the end of the period referred to in Section 3.7(c)
with respect to such REO Property is approaching, the Servicer shall seek an
extension of such period in the manner described in Section 3.7(c).

      (b) In determining whether any bid received from an Interested Person
represents a fair price for any Defaulted Loan or any REO Property, the Trustee
may conclusively rely on the opinion of an Independent appraiser or other expert
in real estate matters retained by the Servicer the expense of which shall be an
expense of the Trust Fund. In determining whether any bid constitutes a fair
price for any Defaulted Loan or any REO Property, the Servicer or the Trustee
(or, if applicable, such appraiser) shall take into account, and any appraiser
or other expert in real estate matters shall be instructed to take into account,
as applicable, among other factors, the period and amount of any delinquency on
the affected Defaulted Loan, the physical condition of the related Mortgaged
Property or such REO Property, the state of the local economy and the Trust
Fund's obligation to dispose of any REO Property within the time period
specified in Section 3.7(c).

      (c) The Servicer shall act on behalf of the Trust Fund in negotiating and
taking any other action reasonably necessary or appropriate in connection with
the sale of any Defaulted Loan or REO Property, including the collection of all
amounts payable in connection therewith. Any sale of a Defaulted Loan or any REO
Property shall be without recourse to, or representation or warranty by, the
Trustee, the Depositor, the Servicer or the Trust Fund (except that any contract
of sale and assignment and conveyance documents may contain customary warranties
of title, so long as the only recourse for breach thereof is to the Trust Fund),
and, if consummated in accordance with the terms of this Agreement, neither the
Servicer, the Depositor nor the Trustee shall have any liability to the Trust
Fund or any Certificateholder with respect to the purchase price therefor
accepted by the Servicer or the Trustee.

      (d) The proceeds of any sale after deduction of the expenses of such sale
incurred in connection therewith shall be promptly deposited in the Custodial
Account for P & I in accordance with Section 3.2(b).

      Section 3.16 Delegation of Duties.

      In the ordinary course of business, the Servicer or the Trustee may at any
time delegate any duties hereunder to any Person who agrees to conduct such
duties in accordance with the applicable terms of this Agreement. In case of
such delegation, the Servicer or the Trustee shall supervise, administer,
monitor and oversee the activities of such Person hereunder to insure that such
Person performs such duties in accordance herewith and shall be responsible for
the acts and omissions of such Person to the same extent as it is responsible
for its own actions or omissions hereunder. Any such delegations shall not
relieve the Servicer or the Trustee of its liability and responsibility with

                                       66
<PAGE>

respect to such duties, and shall not constitute a resignation within the
meaning of Section 6.4 hereof and shall be revocable by any successor Servicer
or the Trustee.

      Section 3.17 [Reserved].

      Section 3.18 [Reserved].

      Section 3.19 Appointment of a Special Servicer.

      The Servicer may enter into a special servicing agreement with an
unaffiliated holder of Subordinate Certificates or a holder of a class of
securities representing interests in such Class of Subordinate Certificates,
such agreement to be (i) substantially in the form of Exhibit R hereto or (ii)
subject to each Rating Agency's acknowledgment that the ratings of the
Certificates in effect immediately prior to the entering into of such agreement
would not be qualified, downgraded or withdrawn and the Certificates would not
be placed on credit review status (except for possible upgrading) as a result of
such agreement. Any such agreement may contain provisions whereby such holder
may instruct the Servicer to commence or delay foreclosure proceedings with
respect to delinquent Loans and may contain provisions for the deposit of cash
by the holder that would be available for distribution to Certificateholders if
Liquidation Proceeds are less than they otherwise may have been had the Servicer
acted in accordance with its normal procedures.

      Section 3.20 Allocation of Realized Losses.

      Prior to each Distribution Date, the Servicer shall determine the amount
of Realized Losses, if any, with respect to each Loan. All Realized Losses,
except for Excess Losses, will be allocated as follows: (i) for losses allocable
to principal (a) first, to the Subordinate Certificates in reverse order of
seniority until each of their Class Principal Balances have been reduced to zero
and (b) second, to the Senior Certificates (other than the Principal Only
Certificates), by Pro Rata Allocation, until the Certificate Principal Balances
thereof have been reduced to zero; provided, however, that prior to the Credit
Support Depletion Date if the loss is recognized with respect to a Discount
Loan, the Discount Fraction of such loss will first be allocated to the Class
A-P Certificates and the remainder of such loss will be allocated as described
above in this clause (i); and (ii) for losses allocable to interest (a) first,
to the Subordinate Certificates in reverse order of seniority, in reduction of
accrued but unpaid interest thereon and (b) second, to the Senior Certificates
(other than the Principal Only Certificates), by Pro Rata Allocation until the
amount of interest accrued on those Senior Certificates on such Distribution
Date has been reduced to zero.

      Excess Losses shall be allocated among the Senior Certificates and the
Subordinate Certificates by Pro Rata Allocation.

      On each Distribution Date, after giving effect to the principal
distributions and allocations and reimbursement of losses as provided in this
Agreement (without regard to this paragraph), if the Aggregate Certificate
Principal Balance of all outstanding Classes of Certificates exceeds the

                                       67
<PAGE>

aggregate principal balance of the Loans, after deduction of (i) all principal
payments due on or before the Cut-Off Date whether or not paid and (ii) all
amounts of principal in respect that have been received or advanced and included
in the Available Distribution Amount, and all losses that have been allocated to
the Senior and Subordinate Certificates, on such Distribution Date, including
any reductions in the Class Principal Balances for the Subordinate Certificates
as a result of any amounts paid in respect of Discount Fractional Principal
Shortfalls on that Distribution Date, then such excess will be deemed a
principal loss and will be allocated first to the Subordinate Certificates in
reverse order of seniority until each of their Class Principal Balances has been
reduced to zero, and second to the Senior Certificates, other than the Interest
Only Certificates, by Pro Rata Allocation, until the aggregate Class Principal
Balance thereof has been reduced to zero.

                                       68
<PAGE>

                                   ARTICLE IV

                    PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
                             STATEMENTS AND REPORTS

      Section 4.1 Distributions to Certificateholders.

      (a) The Trustee shall establish and maintain a separate account as set
forth in Article I (the "Certificate Account"), the purpose of which is to
accept deposits from the Servicer and to make distributions to the
Certificateholders of the amounts set forth in this Section 4.1.

      (b) On each Distribution Date, the Trustee or the Paying Agent, if any,
shall (i) withdraw from the Certificate Account the Available Distribution
Amount for such Distribution Date and shall distribute to each
Certificateholder, from the amount so withdrawn and to the extent of the
Available Distribution Amount, such Certificateholder's share (based on the
aggregate Percentage Interests represented by the Certificates of the applicable
Class held by such Certificateholder) of the amounts and in the order of
priority as set forth in the definition of "Certificate Distribution Amount",
and (ii) distribute Excess Liquidation Proceeds to the Class R
Certificateholder, by wire transfer in immediately available funds for the
account of the Certificateholder, or by any other means of payment acceptable to
each Certificateholder of record on the immediately preceding Record Date (other
than as provided in Section 9.1 respecting the final distribution), as specified
by each such Certificateholder and at the address of such Holder appearing in
the Certificate Register; provided, that such distributions in (i) and (ii)
above shall be made in accordance with written statements received from the
Servicer pursuant to Section 4.2.

      (c) All reductions in the Certificate Principal Balance of a Certificate
effected by distributions of principal or allocations of Realized Losses with
respect to Loans made on any Distribution Date shall be binding upon all Holders
of such Certificate and of any Certificate issued upon the registration of
transfer or exchange therefor or in lieu thereof, whether or not such
distribution is noted on such Certificate. The final distribution of principal
of each Certificate (and the final distribution with respect to the Class R
Certificate upon termination of the Trust Fund) shall be payable in the manner
provided above only upon presentation and surrender thereof on or after the
Distribution Date therefor at the office or agency of the Trustee specified in
the notice delivered pursuant to Section 4.1(d) or Section 9.1.

      (d) Whenever, on the basis of Curtailments, Payoffs and Monthly Payments
on the Loans and Insurance Proceeds and Liquidation Proceeds received and
expected to be received during the applicable Prepayment Period, the Trustee
believes, or the Servicer has notified the Trustee that it believes, that the
entire remaining unpaid Class Principal Balance of any Class of Certificates
will become distributable on the next Distribution Date, the Trustee shall, no
later than the Determination Date of the month of such Distribution Date, mail
or cause to be mailed to each Person in whose

                                       69
<PAGE>

name a Certificate to be so retired is registered at the close of business on
the Record Date, to the Underwriters and to each Rating Agency a notice to the
effect that:

            (i) it is expected that funds sufficient to make such final
      distribution will be available in the Certificate Account on such
      Distribution Date, and

            (ii) if such funds are available, (A) such final distribution will
      be payable on such Distribution Date, but only upon presentation and
      surrender of such Certificate at the office or agency of the Certificate
      Registrar maintained for such purpose (the address of which shall be set
      forth in such notice), and (B) no interest shall accrue on such
      Certificate after such Distribution Date.

      Section 4.2 Statements to Certificateholders.

      (a) Not later than 12:00 noon (New York City time) on the second Business
Day prior to each Distribution Date, the Servicer shall forward to the Trustee
the Servicer's Section 3.10 Report setting forth certain information with
respect to the Loans. With each distribution from the Certificate Account on a
Distribution Date, the Trustee shall make available to each Certificateholder,
through the Trustee's Corporate Trust home page on the world wide web which is
currently located at "www.trustinvestorreporting.usbank.com", a statement (each
a "Certificateholders' Report") prepared by the Servicer based on the
information set forth in the Servicer's Section 3.10 Report, setting forth, to
the extent applicable, the amount of the distribution payable to the applicable
Class that represents principal, separately identifying the aggregate amount of
any Principal prepayments included in such distribution, and the amount that
represents interest, and the applicable Class Principal Balance after giving
effect to such distribution.

      In addition, not later than each Distribution Date, the Trustee shall
forward to such Certificateholder and the Depositor an additional report which
sets forth with respect to the Loans:

            (i) The number and aggregate Principal Balance of the Loans
      delinquent one, two and three months or more;

            (ii) The (A) number and aggregate Principal Balance of Loans with
      respect to which foreclosure proceedings have been initiated, and (B) the
      number and aggregate book value of Mortgaged Properties acquired through
      foreclosure, deed in lieu of foreclosure or other exercise of rights
      respecting the Trustee's security interest in the Loans;

            (iii) The aggregate Principal Balance of the Loans as of the close
      of business on the last day of the related Prepayment Period;

            (iv) The amount of the Servicing Fee retained or withdrawn by the
      Servicer from the Certificate Account and the amount of any Excess
      Liquidation Proceeds received by the Servicer during the related
      Prepayment Period;

                                       70
<PAGE>

            (v) The amount of Special Hazard Coverage available to the Senior
      Certificates remaining as of the close of business on the applicable
      Determination Date;

            (vi) The amount of Bankruptcy Coverage available to the Senior
      Certificates remaining as of the close of business on the applicable
      Determination Date;

            (vii) The amount of Fraud Coverage available to the Senior
      Certificates remaining as of the close of business on the applicable
      Determination Date;

            (viii) The amount of Realized Losses allocable to the related
      Certificates on the related Distribution Date and the cumulative amount of
      Realized Losses incurred allocated to such Certificates since the Cut-Off
      Date;

            (ix) The amount of funds advanced by the Servicer on the related
      Withdrawal Date;

            (x) The total amount of Payoffs and Curtailments received during the
      related Prepayment Period; and

            (xi) The weighted average Pass-Through Rates as of the first day of
      the calendar month immediately preceding the month of the Distribution
      Date.

      Upon request by any Certificateholder, the Servicer, as soon as reasonably
practicable, shall provide the requesting Certificateholder with such
information as is necessary and appropriate, in Servicer's sole discretion, for
purposes of satisfying applicable reporting requirements under Rule 144A of the
Securities Act.

      The Servicer may make available any reports, statements or other
information to Certificateholders through the Servicer's home page on the world
wide web. Such web page is located at "www.wamumsc.com" and information is
available by clicking on "Investor Information."

      The Trustee may make available any reports, statements or other
information to Certificateholders through the Trustee's home page on the world
wide web. Such web page is currently located at
"www.trustinvestorreporting.usbank.com".

      (b) Upon request to the Trustee by any Certificateholder or Beneficial
Holder at the time of making such request (an "Eligible Certificateholder"), the
Servicer shall provide in electronic format loan by loan data with respect to
the payment experience of the Loans containing at least the fields of
information listed on Exhibit E hereto (based on information provided by the
Servicer). In addition, upon the written request of any Eligible
Certificateholder, the Trustee shall provide similar loan by loan data with
respect to any prior monthly remittance report to the Certificateholders
pursuant to this Agreement (as and when such information becomes available). The
expense of

                                       71
<PAGE>

providing any tape or disk pursuant to this subsection shall be an expense of
the Eligible Certificateholder.

      (c) The Servicer shall, on behalf of the Depositor and in respect of the
Trust Fund, prepare, sign and cause to be filed with the Commission any periodic
reports required to be filed under the provisions of the Exchange Act, and the
rules and regulations of the Commission thereunder. In connection with the
preparation and filing of such periodic reports, upon request from the Servicer,
the Depositor and the Trustee shall timely provide to the Servicer all material
information specifically and reasonably requested by the Servicer that is in the
possession of the Depositor or the Trustee, as the case may be, and is not, to
the best of the Depositor's or the Trustee's knowledge, in the possession of the
Servicer and which the Servicer has specifically identified as being required to
be included in such reports. The Servicer shall not have any liability with
respect to the Servicer's failure to properly prepare or file such periodic
reports resulting from or relating to the Servicer's inability or failure to
obtain any information not resulting from the Servicer's own negligence or
willful misconduct. Neither the Depositor nor the Trustee shall have any
liability for the Servicer's failure to properly prepare or file periodic
reports. Prior to January 30 of the first year in which the Servicer is able to
do so under applicable law, the Servicer shall file a Form 15 Suspension
Notification with respect to the Trust Fund. Any Form 10-K filed with the
Commission in connection with this clause (c) shall include a certification,
signed by the senior officer in charge of the servicing functions of the
Servicer, in the form attached as Exhibit S hereto or such other form as may be
required or permitted by the Commission (the "Form 10-K Certification"), in
compliance with Rule 13a-14 and 15d-14 under the Exchange Act and any additional
directives of the Commission. In connection with the Form 10-K Certification,
the Trustee shall provide the Servicer with a back-up certification
substantially in the form attached hereto as Exhibit T, but neither the
Depositor nor the Trustee shall have any responsibility with respect to the
preparation or filing of a Form 10-K or the related 10-K Certification. This
Section 4.2(c) may be amended in accordance with this Agreement without the
consent of the Certificateholders. The Servicer shall promptly forward copies of
all filings made pursuant to this Section 4.2(c) to the Depositor.

      Section 4.3 Advances by the Servicer; Distribution Reports to the Trustee.

      To the extent described below, the Servicer is obligated to advance its
own funds to the Certificate Account to cover any shortfall between (i) payments
scheduled to be received in respect of Loans serviced by such Servicer, and (ii)
the amounts actually deposited in the Certificate Account on account of such
payments. The Servicer's obligation to make any Advance or Advances described in
this Section 4.3 is effective only to the extent that such Advance is, in the
good faith judgment of the Servicer, reimbursable from Insurance Proceeds or
Liquidation Proceeds of the related Loans or recoverable as late Monthly
Payments with respect to the related Loans or otherwise.

      Prior to the close of business on the second Business Day prior to each
Distribution Date, the Servicer shall determine whether or not it will make an
Advance on the next Withdrawal Date and shall furnish a statement to the
Trustee, the Paying Agent, if any, and to any Certificateholder or

                                       72
<PAGE>

Beneficial Holder requesting the same, setting forth the aggregate amount to be
distributed on the next succeeding Distribution Date on account of principal and
interest in respect of the Loans, stated separately. In the event that full
scheduled amounts of principal and interest in respect of the related Loans
shall not have been received by or on behalf of the Servicer prior to the
Determination Date preceding such Distribution Date and the Servicer shall have
determined that an Advance shall be made in accordance with this Section 4.3,
the Servicer shall so specify and shall specify the aggregate amount of such
Advance.

      In the event that the Servicer shall be required to make an Advance, it
shall on the Business Day prior to the Distribution Date either (i) deposit in
the Certificate Account an amount equal to such Advance, (ii) direct the Trustee
to make an appropriate entry in the records of the Certificate Account, or the
Servicer shall make an appropriate entry in the records for the Custodial
Account for P&I, that funds in such account being held for future distribution
or withdrawal have been, as permitted by this Section 4.3, used by such Servicer
to make such Advance, or (iii) make advances in the form of any combination of
(i) and (ii) aggregating the amount of such Advance. Any funds being held for
future distribution to Certificateholders and so used shall be replaced by the
Servicer by deposit in the Certificate Account on any future Distribution Date
to the extent that funds in the Certificate Account on such Distribution Date
with respect to the related Loans shall be less than payments to
Certificateholders required to be made on such date with respect to such Loans.

      The Servicer shall be entitled to reimbursement for any Advance as
provided in Section 3.3 of this Agreement.

      Prior to 5:00 P.M. New York City time on the second Business Day prior to
each Distribution Date, the Servicer shall provide the Trustee with a statement
regarding the amount of principal and interest, the Residual Distribution Amount
and the Excess Liquidation Proceeds to be distributed to each Class of
Certificates on such Distribution Date (such amounts to be determined in
accordance with the definition of "Certificate Distribution Amount", Section 4.1
hereof and other related definitions set forth in Article I hereof).

      Section 4.4 Nonrecoverable Advances.

      Any Advance previously made by or on behalf of the Servicer with respect
to a Loan that the Servicer shall determine in its good faith judgment not to be
ultimately recoverable from Insurance Proceeds or Liquidation Proceeds or
otherwise with respect to such Loan or recoverable as late Monthly Payments with
respect to such Loan shall be a Nonrecoverable Advance. The determination by the
Servicer that it has made a Nonrecoverable Advance or that any advance would
constitute a Nonrecoverable Advance, shall be evidenced by an Officer's
Certificate of the Servicer delivered to the Trustee on the Determination Date
and detailing the reasons for such determination. Notwithstanding any other
provision of this Agreement, any insurance policy relating to the Loans, or any
other agreement relating to the Loans to which the Depositor or the Servicer is
a party, (a) the Servicer shall not be obligated to, and shall not, make any
advance that, after reasonable inquiry and in its sole discretion, it determines
would be a Nonrecoverable Advance, and (b) the Servicer shall

                                       73
<PAGE>

be entitled to reimbursement for any Nonrecoverable Advance as provided in
Section 3.3 of this Agreement.

      Section 4.5 Foreclosure Reports.

      Each year beginning in 2004 the Servicer shall make any reports of
foreclosures and abandonments of any Mortgaged Property required by Section
6050J of the Code. In order to facilitate this reporting process, the Servicer,
on or before February 28th of each year, commencing with 2004, shall provide to
the Internal Revenue Service and the Trustee reports relating to each instance
occurring during the previous calendar year in which the Servicer (i) on behalf
of the Trustee acquires an interest in a Mortgaged Property through foreclosure
or other comparable conversion in full or partial satisfaction of a Loan, or
(ii) knows or has reason to know that a Mortgaged Property has been abandoned.
The reports from the Servicer shall be in form and substance sufficient to meet
the reporting requirements imposed by such Section 6050J.

      Section 4.6 Adjustment of Servicing Fees with Respect to Payoffs.

      The aggregate amount of the Servicing Fee subject to retention from
deposit into or withdrawal from the Certificate Account by the Servicer, in any
month of distribution shall be decreased by any Compensating Interest due and
owing with respect to any Loan with respect to which a Payoff has occurred in
the related Prepayment Period. The Servicer shall include the amount of any such
Compensating Interest with the deposits into the Certificate Account on the
related Withdrawal Date. Notwithstanding the foregoing, the amount by which the
Servicing Fee may be reduced with respect to the related Prepayment Period
pursuant to this Section 4.6 shall not exceed an amount greater than the amount
described in clause (i) of the definition of Compensating Interest for all Loans
as to which Payoffs have occurred and the rights of the Certificateholders to
such portion of the Servicing Fee shall not be cumulative.

      Section 4.7 Prohibited Transactions Taxes and Other Taxes.

      In the event that any tax (including a tax on "prohibited transactions" as
defined in Section 860F(a)(2) of the Code and including any and all interest,
penalties, fines and additions to tax, as well as any and all reasonable counsel
fees and out-of-pocket expenses incurred in contesting the imposition of such
tax) is imposed on the Trust Fund and is not otherwise paid pursuant to Section
4.7(b) hereof, the Servicer shall pay such taxes when and as the same shall be
due and payable (but such obligation shall not prevent the Servicer, the Trustee
or any other appropriate Person from contesting any such tax in appropriate
proceedings and shall not prevent the Servicer from withholding payment of such
tax, if permitted by law, pending the outcome of such proceedings); provided,
that the Servicer shall be entitled to be indemnified for any such taxes
(excluding taxes referred to in Section 4.7(b)) to the extent set forth in
Section 6.3 hereof so long as the Servicer's failure to exercise reasonable care
with respect to the performance of its duties hereunder was not the primary
cause of the imposition of such taxes. If the Servicer is indemnified for such
taxes pursuant to this Section 4.7(a), such amount shall be first charged
against amounts otherwise

                                       74
<PAGE>

distributable to the Holders of Component R-1 of the Class R Certificate (or, if
the tax relates to REMIC II, Component R-2 of the Class R Certificate) on a pro
rata basis, then against amounts otherwise distributable with respect to the
REMIC I Regular Interests (or, if the tax relates to REMIC II, to the Holders of
the REMIC II Certificates) on a pro rata basis. The Trustee is hereby authorized
to retain from amounts otherwise distributable to the Certificateholders
sufficient funds to reimburse the Servicer for the payment of such tax for which
the Servicer is entitled to indemnification.

      Section 4.8 Tax Administration.

      The Servicer is hereby appointed as attorney-in-fact and agent for the
initial Tax Matters Person.

      Section 4.9 Equal Status of Servicing Fee.

      The right of the Servicer to receive its Servicing Fee will be equal and
not subordinate to the right of the Certificateholders to receive principal and
interest payments based on their interests as provided herein. The Servicer's
Servicing Fee may be collected from Monthly Payments as received pursuant to
Section 3.2 without deposit into the Certificate Account, whereas the
Certificateholders' distributions shall be made on a delayed basis as set forth
in the terms of the Certificates.

      Section 4.10 Appointment of Paying Agent.

      The Trustee may appoint an Eligible Institution to act as a paying agent
(the "Paying Agent") in order to delegate to such Eligible Institution any of
its duties under this Agreement to administer the issuance, transfer and
exchange of the Certificates, administer payments to Certificateholders or
prepare information related to the Certificates; provided, that the Trustee
shall remain primarily responsible for any duties so delegated; provided,
further, that the Trustee shall receive no additional compensation in connection
with such appointment and delegation.

      Initially, the Trustee will be the Paying Agent. If the Trustee ceases to
serve as Paying Agent, the Trustee shall send written notice to all
Certificateholders (i) indicating that it is no longer serving in such capacity
and (ii) setting forth its replacement, if any, appointed pursuant to this
Section 4.10.

                                       75
<PAGE>

                                    ARTICLE V

                                THE CERTIFICATES

      Section 5.1 The Certificates.

      (a) The Certificates shall be substantially in the forms set forth in
Exhibits A and B attached hereto, and shall be executed by the Trustee,
authenticated by the Trustee (or any duly appointed Authenticating Agent) and
delivered to or upon the order of the Depositor upon receipt by the Trustee of
the documents specified in Section 2.1. The Certificates shall be issuable in
Authorized Denominations evidencing Percentage Interests. Certificates shall be
executed by manual or facsimile signature on behalf of the Trust Fund by
authorized officers of the Trustee. Certificates bearing the manual or facsimile
signatures of individuals who were at the time of execution the proper officers
of the Trustee shall bind the Trust Fund, notwithstanding that such individuals
or any of them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by the Trustee or any Authenticating Agent by manual signature, and
such certificate upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.

      (b) The following definitions apply for purposes of this Section 5.1:
"Disqualified Organization" means any Person which is not a Permitted
Transferee, but does not include any "Pass-Through Entity" which owns or holds a
Residual Certificate and of which a Disqualified Organization, directly or
indirectly, may be a stockholder, partner or beneficiary; "Pass-Through Entity"
means any regulated investment company, real estate investment trust, common
trust fund, partnership, trust or estate, and any organization to which Section
1381 of the Code applies; "Ownership Interest" means, with respect to any
Residual Certificate, any ownership or security interest in such Residual
Certificate, including any interest in a Residual Certificate as the Holder
thereof and any other interest therein whether direct or indirect, legal or
beneficial, as owner or as pledgee; "Transfer" means any direct or indirect
transfer or sale of, or directly or indirectly transferring or selling, any
Ownership Interest in a Residual Certificate; and "Transferee" means any Person
who is acquiring by Transfer any Ownership Interest in a Residual Certificate.

      (c) Restrictions on Transfers of the Residual Certificate to Disqualified
Organizations are set forth in this Section 5.1(c).

            (i) Each Person who has or who acquires any Ownership Interest in a
      Residual Certificate shall be deemed by the acceptance or acquisition of
      such Ownership Interest to have agreed to be bound by the following
      provisions and to have irrevocably authorized the Trustee, the Servicer or
      the Paying Agent under clause (iii)(A) below to deliver payments

                                       76
<PAGE>

      to a Person other than such Person and to negotiate the terms of any
      mandatory sale under clause (iii)(B) below and to execute all instruments
      of transfer and to do all other things necessary in connection with any
      such sale. The rights of each Person acquiring any Ownership Interest in a
      Residual Certificate are expressly subject to the following provisions:

                  (A) Each Person holding or acquiring any Ownership Interest in
            a Residual Certificate shall be a Permitted Transferee and shall
            promptly notify the Trustee or the Certificate Registrar if not the
            same Person as the Trustee of any change or impending change in its
            status as a Permitted Transferee.

                  (B) In connection with any proposed Transfer of any Ownership
            Interest in a Residual Certificate to a U.S. Person, the Trustee or
            the Certificate Registrar if not the same Person as the Trustee
            shall require delivery to it, and shall not register the Transfer of
            any Residual Certificate until its receipt of (1) an affidavit and
            agreement (a "Transferee Affidavit and Agreement") attached hereto
            as Exhibit J from the proposed Transferee, in form and substance
            satisfactory to the Depositor, representing and warranting, among
            other things, that it is not a Non-U.S. Person, that such transferee
            is a Permitted Transferee, that it is not acquiring its Ownership
            Interest in the Residual Certificate that is the subject of the
            proposed Transfer as a nominee, trustee or agent for any Person who
            is not a Permitted Transferee, that for so long as it retains its
            Ownership Interest in a Residual Certificate, it will endeavor to
            remain a Permitted Transferee, and that it has reviewed the
            provisions of this Section 5.1(c) and agrees to be bound by them,
            and (2) a certificate, attached hereto as Exhibit I, from the Holder
            wishing to transfer the Residual Certificate, in form and substance
            satisfactory to the Depositor, representing and warranting, among
            other things, that no purpose of the proposed Transfer is to allow
            such Holder to impede the assessment or collection of tax.

                  (C) Notwithstanding the delivery of a Transferee Affidavit and
            Agreement by a proposed Transferee under clause (B) above, if the
            Trustee or the Certificate Registrar if not the same Person as the
            Trustee has actual knowledge that the proposed Transferee is not a
            Permitted Transferee, no Transfer of an Ownership Interest in a
            Residual Certificate to such proposed Transferee shall be effected.

                  (D) Each Person holding or acquiring any Ownership Interest in
            a Residual Certificate agrees by holding or acquiring such Ownership
            Interest (i) to require a Transferee Affidavit and Agreement from
            any other Person to whom such Person attempts to transfer its
            Ownership Interest and to provide a certificate to the Trustee or
            the Certificate Registrar if not the same Person as the Trustee in
            the form attached hereto as Exhibit J; (ii) to obtain the express
            written consent of the Depositor prior to any transfer of such
            Ownership Interest, which consent may be withheld in the Depositor's
            sole discretion; and (iii) to provide a certificate to the

                                       77
<PAGE>

            Trustee or the Certificate Registrar if not the same Person as the
            Trustee in the form attached hereto as Exhibit I.

            (ii) The Trustee or the Certificate Registrar if not the same Person
      as the Trustee shall register the Transfer of any Residual Certificate
      only if it shall have received the Transferee Affidavit and Agreement, a
      certificate of the Holder requesting such transfer in the form attached
      hereto as Exhibit J and all of such other documents as shall have been
      reasonably required by the Trustee or the Certificate Registrar if not the
      same Person as the Trustee as a condition to such registration.

            (iii) (A) If any Disqualified Organization shall become a Holder of
      a Residual Certificate, then the last preceding Permitted Transferee shall
      be restored, to the extent permitted by law, to all rights and obligations
      as Holder thereof retroactive to the date of registration of such Transfer
      of such Residual Certificate. If any Non-U.S. Person shall become a Holder
      of a Residual Certificate, then the last preceding Holder which is a U.S.
      Person shall be restored, to the extent permitted by law, to all rights
      and obligations as Holder thereof retroactive to the date of registration
      of the Transfer to such Non-U.S. Person of such Residual Certificate. If a
      transfer of a Residual Certificate is disregarded pursuant to the
      provisions of Treasury Regulations Section 1.860E-1 or Section 1.860G-3,
      then the last preceding Permitted Transferee shall be restored, to the
      extent permitted by law, to all rights and obligations as Holder thereof
      retroactive to the date of registration of such Transfer of such Residual
      Certificate. The Trustee, the Servicer, the Certificate Registrar and the
      Paying Agent shall be under no liability to any Person for any
      registration of Transfer of a Residual Certificate that is in fact not
      permitted by this Section 5.1(c) or for making any payments due on such
      Certificate to the Holder thereof or for taking any other action with
      respect to such Holder under the provisions of this Agreement.

                  (B) If any purported Transferee shall become a Holder of the
            Residual Certificate in violation of the restrictions in this
            Section 5.1(c) and to the extent that the retroactive restoration of
            the rights of the Holder of such Residual Certificate as described
            in clause (iii)(A) above shall be invalid, illegal or unenforceable,
            then the Depositor shall have the right, without notice to the
            Holder or any prior Holder of such Residual Certificate, to sell
            such Residual Certificate to a purchaser selected by the Depositor
            on such terms as the Depositor may choose. Such purported Transferee
            shall promptly endorse and deliver the Residual Certificate in
            accordance with the instructions of the Depositor. Such purchaser
            may be the Depositor itself or any affiliate of the Depositor. The
            proceeds of such sale, net of the commissions (which may include
            commissions payable to the Depositor or its affiliates), expenses
            and taxes due, if any, shall be remitted by the Depositor to such
            purported Transferee. The terms and conditions of any sale under
            this clause (iii)(B) shall be determined in the sole discretion of
            the Depositor, and the Depositor shall not be liable to any Person
            having an Ownership Interest in the Residual Certificate as a result
            of its exercise of such discretion.

                                       78
<PAGE>

            (iv) The Depositor, on behalf of the Trustee, shall make available,
      upon written request from the Trustee, or the Servicer all information
      necessary to compute any tax imposed (A) as a result of the Transfer of an
      Ownership Interest in the Residual Certificate to any Person who is not a
      Permitted Transferee, including the information regarding "excess
      inclusions" of such Residual Certificate required to be provided to the
      Internal Revenue Service and certain Persons as described in Treasury
      Regulation Section 1.860D-1(b)(5), and (B) as a result of any regulated
      investment company, real estate investment trust, common trust fund,
      partnership, trust, estate or organizations described in Section 1381 of
      the Code having as among its record holders at any time any Person who is
      not a Permitted Transferee. Reasonable compensation for providing such
      information may be required by the Depositor from such Person.

            (v) The provisions of this Section 5.1 set forth prior to this
      Section 5.1(c)(v) may be modified, added to or eliminated, provided, that
      there shall have been delivered to the Trustee and the Servicer the
      following:

                  (A) written notification from each Rating Agency to the effect
            that the modification, addition to or elimination of such provisions
            will not cause such Rating Agency to downgrade its then-current
            Ratings of the Certificates; and

                  (B) an Opinion of Counsel, in form and substance satisfactory
            to the Depositor (as evidenced by a certificate of the Depositor),
            to the effect that such modification, addition to or absence of such
            provisions will not cause any REMIC to cease to qualify as a REMIC
            and will not create a risk that (1) the Trust Fund may be subject to
            an entity-level tax caused by the Transfer of any Residual
            Certificate to a Person which is not a Permitted Transferee or (2) a
            Certificateholder or another Person will be subject to a
            REMIC-related tax caused by the Transfer of a Residual Certificate
            to a Person which is not a Permitted Transferee.

            (vi) The following legend shall appear on all Residual Certificates:

            ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE
            MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFEREE AFFIDAVIT
            AND AGREEMENT TO THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE
            REGISTRAR THAT (1) SUCH TRANSFEREE IS NOT EITHER (A) THE UNITED
            STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
            GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
            INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER
            THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS
            EXEMPT FROM THE TAX IMPOSED BY CHAPTER

                                       79
<PAGE>

            1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED
            BY SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN
            SECTION 1381(a)(2)(C) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE
            FOREGOING CLAUSES (A), (B), OR (C) BEING HEREINAFTER REFERRED TO AS
            A "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A DISQUALIFIED
            ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO ENABLE THE
            TRANSFEROR TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH
            AFFIDAVIT SHALL INCLUDE CERTAIN REPRESENTATIONS AS TO THE FINANCIAL
            CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE
            REGISTRATION IN THE CERTIFICATE REGISTER OF ANY TRANSFER, SALE OR
            OTHER DISPOSITION OF THIS CLASS R CERTIFICATE TO A DISQUALIFIED
            ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
            REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT
            WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
            CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER INCLUDING, BUT NOT
            LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH
            HOLDER OF THE CLASS R CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
            SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
            PARAGRAPH.

            IN THE CASE OF ANY CLASS R CERTIFICATE PRESENTED FOR REGISTRATION IN
            THE NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE
            PROHIBITED TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME
            SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE
            CODE (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A
            "PLAN"), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO IS
            USING "PLAN ASSETS" OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, THE
            TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO
            PROVIDE AN OPINION OF COUNSEL ACCEPTABLE TO AND IN FORM AND
            SUBSTANCE SATISFACTORY TO THE TRUSTEE, THE DEPOSITOR AND THE
            SERVICER TO THE EFFECT THAT THE PURCHASE OR HOLDING OF SUCH CLASS R
            CERTIFICATE IS PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT

                                       80
<PAGE>

            CONSTITUTE OR RESULT IN ANY NON-EXEMPT PROHIBITED TRANSACTION UNDER
            SECTION 406 OF ERISA, OR SECTION 4975 OF THE CODE (OR COMPARABLE
            PROVISIONS OF ANY SUBSEQUENT ENACTMENTS), AND WILL NOT SUBJECT THE
            TRUSTEE, THE DEPOSITOR OR THE SERVICER TO ANY OBLIGATION OR
            LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR
            SECTION 4975 OF THE CODE) IN ADDITION TO THOSE UNDERTAKEN IN THE
            AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE
            TRUSTEE, THE DEPOSITOR OR THE SERVICER. EACH PERSON WHO ACQUIRES
            THIS CERTIFICATE SHALL BE DEEMED TO CERTIFY THAT IT MEETS THE
            FOREGOING CONDITIONS, AND THAT IT WILL NOT TRANSFER SUCH CERTIFICATE
            IN VIOLATION OF THE FOREGOING.

            (vii) In the tax year following the initial Tax Matters Person's
      transfer of its Class R Certificate, the Class R Certificateholder with
      the largest Percentage Interest, while not a Disqualified Organization, is
      the Tax Matters Person.

      (d) (i) No purchase or transfer of a Senior Certificate or a Senior
Subordinate Certificate or any interest therein shall be made by or to any
"employee benefit plan" subject to ERISA or any "plan" described by Section
4975(e)(1) of the Code, or any entity deemed to hold plan assets of any of the
foregoing by reason of a plan's investment in such entity (each, a "Plan")
unless (A) in the case of any such Class of Certificates (other than the Class R
Certificate), such Plan qualifies as an accredited investor as defined in Rule
501(a)(1) of Regulation D under the Securities Act and either (1) at the time of
such transfer, the Certificates are rated in one of the top four rating
categories by at least one Rating Agency, or (2) the purchaser is an insurance
company general account that is eligible for, and satisfies all of the
requirements of, Sections I and III of Prohibited Transaction Class Exemption
95-60 ("PTCE 95-60") and (B) in the case of a Class R Certificate, the Trustee
receives an Opinion of Counsel, for the benefit of the Trustee, the Depositor
and the Servicer and on which they may rely acceptable to and in form and
substance satisfactory to the Trustee, the Depositor and the Servicer to the
effect that the purchase or holding of such Class R Certificate is permissible
under applicable law, will not constitute or result in any non-exempt prohibited
transaction under Section 406 of ERISA, or Section 4975 of the Code (or
comparable provisions of any subsequent enactments), and will not subject the
Trustee, the Depositor or the Servicer to any obligation or liability (including
obligations or liabilities under ERISA or Section 4975 of the Code) in addition
to those undertaken in this Agreement, which Opinion of Counsel shall not be an
expense of the Trustee, the Depositor or the Servicer. Each Person who acquires
a Senior Certificate or a Senior Subordinate Certificate shall be deemed to
certify that it meets the foregoing conditions, and that it will not transfer
such Certificate in violation of the foregoing.

                                       81
<PAGE>

      (ii) No purchase or transfer of a Junior Subordinate Certificate shall be
made by or to a Plan unless such purchaser or transferee is an "insurance
company general account" (within the meaning of PTCE 95-60) and is eligible for,
and satisfies all of the requirements for exemptive relief under Sections I and
III of PTCE 95-60. Each Person who acquires a Junior Subordinate Certificate or
any interest therein shall be deemed to certify and shall be required by the
Certificate Registrar to provide an Officer's Certificate (substantially in the
form of Exhibit L hereto) signed by a Responsible Officer of such Person, which
Officer's Certificate shall not be an expense of the Trustee, the Servicer, if
any, the Certificate Registrar or the Depositor) that it meets the foregoing
conditions, and that it will not transfer such Certificate in violation of the
foregoing.

      (e) No transfer, sale, pledge or other disposition of a Junior Subordinate
Certificate shall be made unless such transfer, sale, pledge or other
disposition is made in accordance with this Section 5.1(e) or Section 5.1(f).
Each Person who, at any time, acquires any ownership interest in any Junior
Subordinate Certificate shall be deemed by the acceptance or acquisition of such
ownership interest to have agreed to be bound by the following provisions of
this Section 5.1(e) and Section 5.1(f), as applicable. No transfer of a Junior
Subordinate Certificate shall be deemed to be made in accordance with this
Section 5.1(e) unless such transfer is made pursuant to an effective
registration statement under the Securities Act or unless the Trustee or the
Certificate Registrar, if not the same Person as the Trustee, is provided with
the certificates and an Opinion of Counsel, if required, on which the Trustee
and the Certificate Registrar may conclusively rely, which establishes or
establish to the Trustee's or the Certificate Registrar's, as applicable,
satisfaction that such transfer is exempt from the registration requirements
under the Securities Act, as follows: In the event that a transfer is to be made
in reliance upon an exemption from the Securities Act, the Trustee or the
Certificate Registrar, if not the same Person as the Trustee, shall require, in
order to assure compliance with the Securities Act, that the Certificateholder
desiring to effect such transfer certify to the Trustee and the Certificate
Registrar in writing, in substantially the form attached hereto as Exhibit F,
the facts surrounding the transfer, with such modifications to such Exhibit F as
may be appropriate to reflect the actual facts of the proposed transfer, and
that the Certificateholder's proposed transferee certify to the Trustee and the
Certificate Registrar in writing, in substantially the form attached hereto as
Exhibit G, the facts surrounding the transfer, with such modifications to such
Exhibit G as may be appropriate to reflect the actual facts of the proposed
transfer. If such certificate of the proposed transferee does not contain
substantially the substance of Exhibit G, the Trustee or the Certificate
Registrar, if not the same Person as the Trustee, shall require an Opinion of
Counsel satisfactory to it that such transfer may be made without registration,
which Opinion of Counsel shall not be obtained at the expense of the Trustee,
the Servicer, the Certificate Registrar, the Trust Fund or the Depositor. Such
Opinion of Counsel shall allow for the forwarding, and the Trustee shall
forward, a copy thereof to each Rating Agency. Notwithstanding the foregoing,
any Class of Junior Subordinate Certificates may be transferred, sold, pledged
or otherwise disposed of in accordance with the requirements set forth in
Section 5.1(f).

      (f) Transfers of the Junior Subordinate Certificates may be made in
accordance with this Section 5.1(f). To effectuate a Certificate transfer in
accordance with this Section 5.1(f), the proposed transferee of such Certificate
must provide the Trustee, the Certificate Registrar and the

                                       82
<PAGE>

Depositor with an investment letter substantially in the form of Exhibit L
attached hereto, which investment letter shall not be an expense of the Trustee,
the Servicer, the Certificate Registrar or the Depositor, and which investment
letter states that, among other things, such transferee (i) is a "qualified
institutional buyer" as defined under Rule 144A, acting for its own account or
the accounts of other "qualified institutional buyers" as defined under Rule
144A, and (ii) is aware that the proposed transferor intends to rely on the
exemption from registration requirements under the Securities Act provided by
Rule 144A. Notwithstanding the foregoing, the proposed transferee of such
Certificate shall not be required to provide the Trustee, the Certificate
Registrar or the Depositor with Annex 1 or Annex 2 to the form of Exhibit L
attached hereto if the Depositor so consents prior to each such transfer. Such
transfers shall be deemed to have complied with the requirements of this Section
5.1(f). The Holder of a Certificate desiring to effect such transfer does hereby
agree to indemnify the Trustee, the Servicer, if any, the Depositor, and the
Certificate Registrar against any liability that may result if transfer is not
made in accordance with this Agreement.

      (g) None of the Trustee, the Servicer, the Certificate Registrar or the
Paying Agent shall have any liability to the Trust Fund arising from a
registration or transfer of a Certificate in reliance upon a certification,
Officer's Certificate, affidavit, ruling or Opinion of Counsel described in this
Section 5.1.

      Section 5.2 Certificates Issuable in Classes; Distributions of Principal
and Interest; Authorized Denominations.

      The aggregate principal amount of Certificates that may be authenticated
and delivered under this Agreement is limited to the aggregate Principal Balance
of the Loans as of the Cut-Off Date, as specified in the Preliminary Statement
to this Agreement, except for Certificates authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Certificates pursuant to Section 5.3. Such aggregate principal amount shall be
allocated among one or more Classes having designations, types of interests,
initial per annum Remittance Rates, initial Class Principal Balances and last
scheduled Distribution Dates as specified in the Preliminary Statement to this
Agreement. The aggregate Percentage Interest of each Class of Certificates of
which the Class Principal Balance equals zero as of the Cut-Off Date that may be
authenticated and delivered under this Agreement is limited to 100%.
Certificates shall be issued in Authorized Denominations.

      Section 5.3 Registration of Transfer and Exchange of Certificates.

      The Trustee shall cause to be maintained at one of its offices or at its
designated Certificate Registrar, a Certificate Register in which there shall be
recorded the name and address of each Certificateholder. Subject to such
reasonable rules and regulations as the Trustee may prescribe, the Certificate
Register shall be amended from time to time by the Trustee or its agent to
reflect notice of any changes received by the Trustee or its agent pursuant to
Section 10.5. The Trustee hereby appoints itself as the initial Certificate
Registrar. The Trustee may appoint an Eligible Institution to

                                       83
<PAGE>

act as its agent in order to delegate to such Eligible Institution its duties as
Certificate Registrar under this Agreement.

      Upon surrender for registration of transfer of any Certificate to the
Trustee at its Corporate Trust Office or at the office of U.S. Bank National
Association, 100 Wall Street, Suite 1600, New York, New York 10005, or such
other address or agency as may hereafter be provided to the Servicer in writing
by the Trustee, the Trustee shall execute, and the Trustee or any Authenticating
Agent shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Certificates of Authorized Denominations of like
Percentage Interest. At the option of the Certificateholders, Certificates may
be exchanged for other Certificates in Authorized Denominations of like
Percentage Interest, upon surrender of the Certificates to be exchanged at any
such office or agency. Whenever any Certificates are so surrendered for
exchange, the Trustee shall execute, and the Trustee, or any Authenticating
Agent, shall authenticate and deliver, the Certificates which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer shall (if so required by the Trustee or
any Authenticating Agent) be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Trustee or any Authenticating
Agent and duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing.

      A reasonable service charge may be made for any such exchange or transfer
of Certificates, and the Trustee or an Authenticating Agent may require payment
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any exchange or transfer of Certificates.

      All Certificates surrendered for exchange or transfer shall be canceled by
the Trustee or any Authenticating Agent.

      Section 5.4 Mutilated, Destroyed, Lost or Stolen Certificates.

      If (i) any mutilated Certificate is surrendered to the Trustee or any
Authenticating Agent, or (ii) the Trustee or any Authenticating Agent receives
evidence to their satisfaction of the destruction, loss or theft of any
Certificate, and there is delivered to the Trustee or any Authenticating Agent
such security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Trustee or any Authenticating
Agent that such Certificate has been acquired by a bona fide purchaser, the
Trustee shall execute and the Trustee or any Authenticating Agent shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like Percentage
Interest. Upon the issuance of any new Certificate under this Section 5.4, the
Trustee or any Authenticating Agent may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee
or any Authenticating Agent) connected therewith. Any replacement Certificate
issued pursuant to this Section 5.4 shall constitute complete and indefeasible
evidence of ownership in the Trust Fund, as if originally issued, whether or not
the lost or stolen Certificate shall be found at any time.

                                       84
<PAGE>

      Section 5.5 Persons Deemed Owners.

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

      Section 5.6 Temporary Certificates.

      Upon the initial issuance of the Certificates, the Trustee may execute,
and the Trustee or any Authenticating Agent shall authenticate and deliver,
temporary Certificates which are printed, lithographed, typewritten or otherwise
produced, in any Authorized Denomination, of the tenor of the definitive
Certificates in lieu of which they are issued and with such variations in form
from the forms of the Certificates set forth as Exhibits A and B hereto as the
Trustee's officers executing such Certificates may determine, as evidenced by
their execution of the Certificates. Notwithstanding the foregoing, the
Certificates may remain in the form set forth in this Section.

      If temporary Certificates are issued, the Trustee shall cause definitive
Certificates to be prepared within ten Business Days of the Closing Date or as
soon as practicable thereafter. After preparation of definitive Certificates,
the temporary Certificates shall be exchangeable for definitive Certificates
upon surrender of the temporary Certificates at the office or agency of the
Trustee to be maintained as provided in Section 5.10 hereof, without charge to
the Holder. Any tax or governmental charge that may be imposed in connection
with any such exchange shall be borne by the Depositor. Upon surrender for
cancellation of any one or more temporary Certificates, the Trustee shall
execute and the Trustee or any Authenticating Agent shall authenticate and
deliver in exchange therefor a like principal amount of definitive Certificates
of Authorized Denominations. Until so exchanged, the temporary Certificates
shall in all respects be entitled to the same benefits under this Agreement as
definitive Certificates.

      Section 5.7 Book-Entry for Book-Entry Certificates.

      Notwithstanding the foregoing, the Book-Entry Certificates, upon original
issuance, shall be issued in the form of one or more typewritten Certificates of
Authorized Denomination representing the Book-Entry Certificates, to be
delivered to DTC, the initial Clearing Agency, by, or on behalf of, the
Depositor. The Book-Entry Certificates shall initially be registered on the
Certificate Register in the name of Cede & Co., the nominee of DTC, as the
initial Clearing Agency, and no Beneficial Holder shall receive a definitive
certificate representing such Beneficial Holder's interest in any Class of
Book-Entry Certificate, except as provided above and in Section 5.9. Each
Book-Entry Certificate shall bear the following legend:

      Unless this Certificate is presented by an authorized representative of
      The Depository Trust Company, a New York corporation ("DTC"), to the
      Trustee or its agent for

                                       85
<PAGE>

      registration of transfer, exchange, or payment, and any Certificate issued
      is registered in the name of Cede & Co. or such other name as is requested
      by an authorized representative of DTC (and any payment is made to Cede &
      Co. or to such other entity as is requested by an authorized
      representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
      OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
      owner hereof, Cede & Co., has an interest herein.

Unless and until definitive, fully registered Book-Entry Certificates (the
"Definitive Certificates") have been issued to the Beneficial Holders pursuant
to Section 5.9:

      (a) the provisions of this Section 5.7 shall be in full force and effect
with respect to the Book-Entry Certificates;

      (b) the Servicer and the Trustee may deal with the Clearing Agency for all
purposes with respect to the Book-Entry Certificates (including the making of
distributions on the Book-Entry Certificates) as the sole Certificateholder;

      (c) to the extent that the provisions of this Section 5.7 conflict with
any other provisions of this Agreement, the provisions of this Section 5.7 shall
control; and

      (d) the rights of the Beneficial Holders shall be exercised only through
the Clearing Agency and the DTC Participants and shall be limited to those
established by law and agreements between such Beneficial Holders and the
Clearing Agency and/or the DTC Participants. Pursuant to the Depositary
Agreement, unless and until Definitive Certificates are issued pursuant to
Section 5.9, the initial Clearing Agency will make book-entry transfers among
the DTC Participants and receive and transmit distributions of principal and
interest on the related Class of Book-Entry Certificates to such DTC
Participants.

      For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of Book-Entry
Certificates evidencing a specified Percentage Interest, such direction or
consent may be given by the Clearing Agency at the direction of Beneficial
Holders owning Book-Entry Certificates evidencing the requisite Percentage
Interest represented by the Book-Entry Certificates. The Clearing Agency may
take conflicting actions with respect to the Book-Entry Certificates to the
extent that such actions are taken on behalf of the Beneficial Holders.

      Section 5.8 Notices to Clearing Agency.

      Whenever notice or other communication to the Certificateholders is
required under this Agreement, unless and until Definitive Certificates shall
have been issued to the related Certificateholders pursuant to Section 5.9, the
Trustee shall give all such notices and communications specified herein to be
given to Holders of the Book-Entry Certificates to the

                                       86
<PAGE>

Clearing Agency which shall give such notices and communications to the related
DTC Participants in accordance with its applicable rules, regulations and
procedures.

      Section 5.9 Definitive Certificates.

      If (a) the Clearing Agency notifies the Trustee that it is no longer
willing or able to discharge properly its responsibilities under the Depositary
Agreement with respect to the Book-Entry Certificates and the Trustee is unable
to locate a qualified successor, (b) the Depositor, at its option, advises the
Trustee in writing that it elects to terminate the book-entry system with
respect to the Book-Entry Certificates through the Clearing Agency or (c) after
the occurrence of an Event of Default, Certificateholders holding Book-Entry
Certificates evidencing Percentage Interests aggregating not less than 66% of
the aggregate Class Principal Balance of such Certificates advise the Trustee
and the Clearing Agency through DTC Participants in writing that the
continuation of a book-entry system with respect to the Book-Entry Certificates
through the Clearing Agency is no longer in the best interests of the
Certificateholders with respect to such Certificates, the Trustee shall notify
or cause to be notified all Certificateholders of Book-Entry Certificates of the
occurrence of any such event and of the availability of Definitive Certificates.
Upon surrender to the Trustee of the Book-Entry Certificates by the Clearing
Agency, accompanied by registration instructions from the Clearing Agency for
registration, the Trustee shall execute and the Trustee or any Authenticating
Agent shall authenticate and deliver the Definitive Certificates. Neither the
Depositor, the Authenticating Agent nor the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such instructions. Upon the issuance of Definitive
Certificates for all of the Certificates all references herein to obligations
imposed upon or to be performed by the Clearing Agency shall be deemed to be
imposed upon and performed by the Trustee, and the Trustee, the Certificate
Registrar and the Paying Agent shall recognize the Holders of Definitive
Certificates as Certificateholders hereunder.

      Section 5.10 Office for Transfer of Certificates.

      The Trustee shall maintain in New York, New York, an office or agency
where Certificates may be surrendered for registration of transfer or exchange.
U.S. Bank National Association, 100 Wall Street, Suite 1600, New York, New York
10005, Attn: Corporate Trust Window, is initially designated for said purposes.
The Trustee will give prompt written notice to the Certificateholders of any
change in such location of any such office or agency.

                                       87
<PAGE>

                                   ARTICLE VI

                         THE DEPOSITOR AND THE SERVICER

      Section 6.1 Liability of the Depositor and the Servicer.

      The Depositor and the Servicer shall each be liable in accordance herewith
only to the extent of the obligations specifically imposed by this Agreement and
undertaken hereunder by the Depositor and the Servicer herein.

      Section 6.2 Merger or Consolidation of the Depositor or the Servicer.

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

      The Depositor or the Servicer may be merged or consolidated with or into
any Person, or transfer all or substantially all of its assets to any Person, in
which case any Person resulting from any merger or consolidation to which the
Depositor or Servicer shall be a party, or any Person succeeding to the business
of the Depositor or Servicer, shall be the successor of the Depositor or
Servicer hereunder, without the execution or filing of any paper or any further
act on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.

      Section 6.3 Limitation on Liability of the Servicer and Others.

      Neither the Servicer nor any of the directors, officers, employees or
agents of the Servicer shall be under any liability to the Trust Fund or the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect any director, officer,
employee or agent of the Servicer against any liability which would otherwise be
imposed by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties hereunder. The Servicer and any director, officer, employee or agent of
the Servicer may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. The Servicer and any director, officer, employee or agent of the
Servicer shall be indemnified by the Trust Fund and held harmless against any
loss, liability or expense incurred in connection with any legal action relating
to this Agreement or the Certificates, other than any loss, liability or
expense, in the case of the Servicer and any director, officer, employee or
agent of the Servicer, incurred by reason of willful misfeasance, bad faith or
gross negligence in the performance of duties hereunder or

                                       88
<PAGE>

by reason of reckless disregard of obligations and duties hereunder. The
Servicer shall not be under any obligation to appear in, prosecute or defend any
legal action which is not incidental to its duties to service the Loans in
accordance with this Agreement and which in its opinion may involve it in any
expense or liability; provided, however, that the Servicer may in its discretion
undertake any such action which it may deem necessary or desirable in respect of
this Agreement and the rights and duties of the parties hereto and the interests
of the Certificateholders hereunder. In such event, the legal expenses and costs
of such action and any liability resulting therefrom shall be expenses, costs
and liabilities of the Trust Fund, and the Servicer shall be entitled to be
reimbursed therefor out of the Certificate Account as provided by Section 3.3.

      Section 6.4 Servicer Not to Resign.

      The Servicer shall not resign from the obligations and duties hereby
imposed on it, except upon determination that its duties hereunder are no longer
permissible under applicable law. Any such determination permitting the
resignation of the Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. The Servicer shall notify each Rating Agency of
any such resignation. No such resignation shall become effective until a
successor servicer shall have assumed the Servicer's responsibilities and
obligations in accordance with Section 7.5 hereof.

      Section 6.5 Trustee Access.

      The Servicer shall afford the Depositor and the Trustee, upon reasonable
notice, during normal business hours access to all records maintained by the
Servicer, in respect of its rights and obligations hereunder and access to such
of its officers as are responsible for such obligations. Upon reasonable
request, the Servicer, shall furnish the Depositor and the Trustee with its most
recent financial statements (or, for so long as Washington Mutual Mortgage
Securities Corp. is Servicer hereunder, the most recent consolidated financial
statements of Washington Mutual, Inc., or the entity with whose financial
statements the financial statements of the Servicer are consolidated) and such
other information as it possesses, and which it is not prohibited by law or, to
the extent applicable, binding obligations to third parties with respect to
confidentiality from disclosing, regarding its business, affairs, property and
condition, financial or otherwise.

                                       89
<PAGE>

                                   ARTICLE VII

                                     DEFAULT

      Section 7.1 Events of Default.

      In case one or more of the following Events of Default by the Servicer
shall occur and be continuing, that is to say:

            (i) any failure by the Servicer to distribute or cause to be
      distributed to the Trustee or its delegate on the Withdrawal Date any
      payment required to be made to the Trustee under the terms of this
      Agreement which continues unremedied for a period of five days after the
      date upon which written notice of such failure, requiring the same to be
      remedied, shall have been given to the Servicer by the Trustee or to the
      Servicer and the Trustee by the Holders of Certificates evidencing
      Percentage Interests aggregating not less than 25% of the Trust Fund or
      51% of the aggregate Percentage Interests of any Class of Certificates;

            (ii) any failure on the part of the Servicer duly to observe or
      perform in any material respect any other of the covenants or agreements
      on the part of the Servicer in the Certificates or in this Agreement which
      continues unremedied for a period of 60 days after the date on which
      written notice of such failure, requiring the same to be remedied, shall
      have been given to the Servicer by the Trustee, or to the Servicer and the
      Trustee by the Holders of Certificates evidencing, in aggregate, not less
      than 25% of the Trust Fund or 51% of the aggregate Percentage Interests of
      any Class of Certificates;

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

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

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

                                       90
<PAGE>

            (vi) any failure of the Servicer to make any Advance required to be
      made from its own funds pursuant to Section 4.3 which continues unremedied
      for a period of one Business Day after the date upon which such Advance
      was to have been made;

then, if an Event of Default described in clauses (i)-(v) of this Section 7.1
shall occur, and in each and every such case, subject to applicable law, so long
as an Event of Default shall not have been remedied, either the Trustee or the
Holders of Certificates evidencing, in aggregate, not less than 25% of the Trust
Fund or 51% of the aggregate Percentage Interests of any Class of Certificates
by notice in writing to the Servicer (and to the Trustee if given by the
Certificateholders) may terminate all of the rights and obligations of the
Servicer under this Agreement, but without prejudice to any rights it may have
to reimbursement of expenses, Advances and other advances of its own funds as
Servicer to the extent permitted by this Agreement, other than the Depositor's
(or its successors') obligation to repurchase any Loans pursuant to Section 2.2
or 2.3 shall survive any such termination. If an Event of Default described in
clause (vi) hereof shall occur, the Trustee shall, by notice in writing to the
Servicer, which shall be telecopied to the Servicer, immediately terminate all
of the rights and obligations of the Servicer, under this Agreement and in and
to the Loans and the proceeds thereof. On or after the receipt by the Servicer
of such written notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Certificates or the Loans or otherwise,
shall pass to and be vested in the Trustee pursuant to and under this Section
7.1 (subject to the provisions of Section 7.5); and, without limitation, the
Trustee is hereby authorized and empowered to execute and deliver, on behalf of
the Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Loans and related
documents or otherwise at the expense of the Servicer. The Servicer agrees to
cooperate with the Trustee in effecting the termination of the Servicer's
responsibilities and rights hereunder and shall promptly provide the Trustee all
documents and records whether in written or electronic form reasonably requested
by it to enable it to assume the Servicer's functions hereunder and shall
promptly also transfer to the Trustee of this Agreement all amounts which then
have been or should have been deposited in the Custodial Account for P&I by the
Servicer or which are thereafter received with respect to the Loans as well as
any escrowed funds held by it or in connection with its servicing activities
hereunder. The Servicer and the Trustee shall give each Rating Agency notice of
any Event of Default. If the Servicer shall within two Business Days following
such suspension remit to the Trustee the amount of any Advance the nonpayment of
which by the Servicer was an Event of Default described in clause (vi) of this
Section 7.1, the Trustee, subject to the last sentence of this paragraph, shall
permit the Servicer to resume its rights and obligations as Servicer hereunder.
The Servicer agrees that it will reimburse the Trustee for actual, necessary and
reasonable costs incurred by the Trustee because of action taken pursuant to
clause (vi) of this Section 7.1. The Servicer agrees that if an Event of Default
as described in clause (vi) of this Section 7.1 shall occur more than two times
in any twelve month period, the Trustee shall be under no obligation to permit
the Servicer to resume its rights and obligations as Servicer hereunder.

                                       91
<PAGE>

      Section 7.2 Other Remedies of Trustee.

      During the continuance of any Event of Default, so long as such Event of
Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 7.1, shall have the right, in its own name as trustee of an
express trust, to take all actions now or hereafter existing at law, in equity
or by statute to enforce its rights and remedies, and to protect the interests,
and enforce the rights and remedies, of the Certificateholders (including the
institution and prosecution of all judicial, administrative and other
proceedings and the filing of proofs of claim and debt in connection therewith).
Except as otherwise expressly provided in this Agreement, no remedy provided for
by this Agreement shall be exclusive of any other remedy, and each and every
remedy shall be cumulative and in addition to any other remedy and no delay or
omission to exercise any right or remedy shall impair any such right or remedy
or shall be deemed to be a waiver of any Event of Default.

      Section 7.3 Directions by Certificateholders and Duties of Trustee During
Event of Default.

      During the continuance of any Event of Default, Holders of Certificates
evidencing, in aggregate, not less than 25% of the Trust Fund or 51% of the
aggregate Percentage Interests of any Class of Certificates may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee under this
Agreement; provided, however, that the Trustee shall be under no obligation to
pursue any such remedy, or to exercise any of the trusts or powers vested in it
by this Agreement (including, without limitation, (i) the conducting or
defending of any administrative action or litigation hereunder or in relation
hereto and (ii) the terminating of the Servicer or any successor servicer from
its rights and duties as servicer hereunder) at the request, order or direction
of any of the Certificateholders, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or thereby; and,
provided, further, that, subject to the provisions of Section 8.1, the Trustee
shall have the right to decline to follow any such direction if the Trustee, in
accordance with an Opinion of Counsel, determines that the action or proceeding
so directed may not lawfully be taken or if the Trustee in good faith determines
that the action or proceeding so directed would involve it in personal liability
or be unjustly prejudicial to the non-assenting Certificateholders or if the
Trustee has received contrary directions pursuant to this Section 7.3.

      Section 7.4 Action upon Certain Failures of Servicer and upon Event of
Default.

      In the event that the Trustee shall have knowledge of any failure of the
Servicer specified in Section 7.1(i) or (ii) which would become an Event of
Default upon the Servicer's failure to remedy the same after notice, the Trustee
shall give notice thereof to the Servicer. In the event that the Trustee shall
have knowledge of an Event of Default, the Trustee shall give prompt written
notice thereof to the Certificateholders and to each Rating Agency. For all
purposes of this Agreement, in the absence of actual knowledge by a Responsible
Officer of the Trustee, the Trustee shall not be deemed to have knowledge

                                       92
<PAGE>

of any failure of the Servicer as specified in Section 7.1(i) and (ii) or any
Event of Default unless notified thereof in writing by the Servicer or by a
Certificateholder.

      Section 7.5 Appointment of Successor Servicer.

      (a) When the Servicer receives a notice of termination pursuant to Section
7.1 or the Trustee receives the resignation of the Servicer evidenced by an
Opinion of Counsel pursuant to Section 6.4, the Trustee shall become the
successor in all respects to the Servicer in its capacity as Servicer under this
Agreement and the transactions set forth or provided for herein, provided,
however, that the Trustee's obligation to make any Advances shall be no greater
than set forth in Section 4.3 of this Agreement, and the Trustee shall have all
the rights and powers and be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof and in its capacity as such successor shall have the same limitation of
liability herein granted to the Servicer and provided, further, that the Trustee
shall not be required to make an Advance from its own funds if such Advance
would be prohibited by law. As compensation therefor, the Trustee shall be
entitled to receive monthly an amount not to exceed the Servicing Fee as agreed
by the Trustee and the Depositor, together with such other servicing
compensation in the form of assumption fees, late charges, prepayment fees or
otherwise provided in Section 3.9. If the agreed amount is less than the
Servicing Fee, the excess shall be paid to the Class R Certificateholder. If the
Trustee and the Depositor shall not agree on the amount of such compensation,
the Trustee shall solicit bids for a successor servicer as described in Section
7.5(b), provided, however, if no successor servicer is obtained through the
bidding process, the Trustee may act as such, or may pursuant to Section 7.5(b)
appoint a successor servicer to act as such, for the Servicing Fee together with
such other servicing compensation as provided in Section 3.9. In no event shall
the Trustee's assumption of or succession to the obligations of the Servicer
make the Trustee liable for any actions or omissions of the Servicer in its
capacity as Servicer.

      (b) Notwithstanding the above, the Trustee may and shall, if it is unable
(or unwilling due to disagreement on compensation as provided in Section 7.5
(a)) to act as Servicer, appoint, or petition a court of competent jurisdiction
to appoint, any established housing and home finance institution, bank or
mortgage servicing institution which is an approved FNMA or FHLMC servicer
having a net worth of not less than $15,000,000 and meeting such other standards
as are set forth in Section 6.4 hereof for a successor to the Servicer hereunder
in the assumption of all or any part of the responsibilities, duties or
liabilities of the Servicer hereunder (except the repurchase obligations set
forth in Sections 2.2 and 2.3 hereof, which shall remain obligations of the
Depositor); provided, however, that until such appointment and assumption, the
Trustee will continue to perform the servicing obligations pursuant to this
Agreement (and until such time shall be entitled to receive the Servicing Fees
pursuant to Section 3.9); provided, further, that prior to the appointment of
any successor servicer, the Rating Agencies confirm that the appointment of such
successor servicer would not result in the downgrade of the Rating assigned to
any Class of Certificates. The compensation of any successor servicer so
appointed shall be equal to the Servicing Fees specified in Section 3.9 together
with such other compensation as is provided in said Section 3.9. In the event
the Trustee is required to solicit bids as provided above, the Trustee shall
solicit,

                                       93
<PAGE>

by public announcement, bids from housing and home finance institutions, banks
and mortgage servicing institutions acceptable to the Trustee and meeting the
qualifications set forth above in this Section 7.5(b) for the purchase of the
servicing functions. Such public announcement shall specify that the successor
servicer shall be entitled to the full amount of the Servicing Fee on the
aggregate unpaid principal balance of the Loans as servicing compensation for
servicing the Loans, together with the other servicing compensation in the form
of assumption fees, late payment charges, prepayment fees or otherwise as
provided in Section 3.9. Within 45 days after any such public announcement, the
Trustee shall negotiate and effect the sale, transfer and assignment of the
servicing rights and responsibilities hereunder (except the repurchase
obligations set forth in Sections 2.2 and 2.3 hereof, which shall remain
obligations of the Depositor) to the qualified party submitting the highest
qualifying bid. The Trustee shall deduct all costs and expenses of any public
announcement and of any sale, transfer and assignment of the servicing rights
and responsibilities hereunder from any sum received by the Trustee from the
successor to the Servicer in respect of such sale, transfer and assignment.
After such deductions, the remainder of such sum shall be paid by the Trustee to
the Class R Certificateholder at the time of such sale, transfer and assignment
to the Servicer's successor.

      (c) In the event that the Servicer resigns or is terminated in accordance
with the terms of this Agreement, the Servicer agrees to cooperate with the
Trustee and any successor servicer in effecting the termination of the
Servicer's servicing responsibilities and rights hereunder and shall promptly
provide the Trustee or such successor servicer, as applicable, all documents and
records reasonably requested by it to enable it to assume the Servicer's
functions hereunder and shall promptly also transfer to the Trustee or such
successor servicer, as applicable, all amounts which then have been or should
have been deposited in the Custodial Account for P&I by the Servicer or which
are thereafter received with respect to the Loans. Neither the Trustee nor any
other successor servicer shall be deemed to be in default hereunder by reason of
any failure to make, or any delay in making, any distribution hereunder or any
portion thereof caused by the failure of the Servicer to deliver, or any delay
in delivering, cash, documents or records to it.

      Section 7.6 Notification to Certificateholders.

      Upon any termination of the Servicer or appointment of a successor to the
Servicer, in each case as provided herein, the Trustee shall as soon as
practicable give written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register and each Rating
Agency.

                                       94
<PAGE>

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE

      Section 8.1 Duties of Trustee.

      The Trustee, prior to the occurrence of an Event of Default and after the
curing of all Events of Default which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this
Agreement. In case an Event of Default has occurred (which has not been cured),
the Trustee, subject to the provisions of Sections 7.1, 7.3, 7.4 and 7.5, shall
exercise such of the rights and powers vested in it by this Agreement, and use
the same degree of care and skill in their exercise as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs. Any permissive right of the Trustee enumerated in this Agreement shall
not be construed as a duty.

      Subject to Sections 8.2(i), 8.3 and 8.4, the Trustee, upon receipt of all
resolutions, certificates, statements, opinions, reports, documents, orders or
other instruments furnished to the Trustee which are specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they are in the form required by this Agreement; provided,
however, that the Trustee shall not be responsible for the accuracy or content
of any resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by any party hereunder. If any such instrument is
found not to conform to the requirements of this Agreement in a material manner,
the Trustee shall take action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to the Trustee's reasonable
satisfaction, the Trustee will provide notice thereof to the Certificateholders
and each Rating Agency.

      No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct or in the event the Trustee is acting as successor
servicer pursuant to Section 7.5, to the standard imposed on the Servicer
pursuant to Section 6.3 of this Agreement; provided, however, that:

            (i) Prior to the occurrence of an Event of Default and after the
      curing of all such Events of Default which may have occurred, the duties
      and obligations of the Trustee shall be determined solely by the express
      provisions of this Agreement, the Trustee shall not be liable except for
      the performance of such duties and obligations as are specifically set
      forth in this Agreement, no implied covenants or obligations shall be read
      into this Agreement against the Trustee and, in the absence of bad faith
      on the part of the Trustee, the Trustee may conclusively rely, as to the
      truth of the statements and the correctness of the opinions expressed
      therein, upon any certificates or opinions furnished to the Trustee and
      conforming to the requirements of this Agreement;

                                       95
<PAGE>

            (ii) The Trustee shall not be personally liable with respect to any
      action taken, suffered or omitted to be taken by it in good faith in
      accordance with this Agreement or at the direction of Certificateholders
      holding Certificates which have an aggregate Certificate Principal Balance
      aggregating not less than 25% of the aggregate Certificate Principal
      Balance of all Certificates or 51% of the aggregate Certificate Principal
      Balance of any Class of Certificates relating to the time, method and
      place of conducting any proceeding for any remedy available to the
      Trustee, or exercising or omitting to exercise any trust or power
      conferred upon the Trustee, under this Agreement;

            (iii) The Trustee shall not be liable in its individual capacity for
      any error of judgment made in good faith by any Responsible Officer,
      unless it shall be proved that the Trustee or such Responsible Officer was
      negligent in ascertaining the pertinent facts;

            (iv) The Trustee shall not be liable for any act or omission of the
      Depositor or the Servicer (except for its own acts or omissions as
      Servicer hereunder) or for any but its own acts or omissions;

            (v) The Trustee shall not be deemed to take notice or be deemed to
      have knowledge of any matter, including without limitation any default or
      Event of Default, unless written notice thereof, referring to the
      Certificates, the Depositor, the Trust Fund or this Agreement is received
      by a Responsible Officer of the Trustee at its Corporate Trust Office;

            (vi) Subject to the other provisions of this Agreement and without
      limiting the generality of this Section 8.1, the Trustee shall have no
      duty (A) to see to any recording, filing, or depositing of this Agreement
      or any agreement referred to herein or any financing statement or
      continuation statement evidencing a security interest, or to see to the
      maintenance of any such recording or filing or depositing or to any
      rerecording, refiling or redepositing of any thereof, (B) to see any
      insurance, (C) to see to the payment or discharge of any tax, assessment,
      or other governmental charge or any lien or encumbrance of any kind owing
      with respect to, assessed or levied against, any part of the Trust Fund
      other than from funds available in the Certificate Account, and (D) to
      confirm or verify the contents of any reports or certificates of the
      Servicer delivered to the Trustee pursuant to this Agreement believed by
      the Trustee to be genuine and to have been signed or presented by the
      proper party or parties;

            (vii) No provision of this Agreement shall require the Trustee to
      expend or risk its own funds or otherwise incur any financial liability in
      the performance of its duties hereunder (except for the giving of required
      notices), or in the exercise of any of its rights and powers, if it shall
      have reasonable grounds for believing the repayment of such funds or
      adequate indemnity against such risk or liability is not reasonably
      assured to it; and

                                       96
<PAGE>

            (viii) When the Trustee is acting as the Servicer pursuant to
      Section 7.5, and to the extent permitted under applicable law, the Trustee
      is hereby authorized, in making or disposing of any investment permitted
      hereunder, to deal with itself (in its individual capacity) or with any
      one or more of its Affiliates, whether its Affiliate is acting as an agent
      of the Trustee or of any third person or dealing as principal for its own
      account.

      None of the provisions contained in this Agreement shall require the
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties as Trustee hereunder or in the exercise
of any of its rights or powers if there is reasonable ground for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee to perform, or be responsible
for the manner of performance of, any of the obligations of the Servicer under
this Agreement except during such time, if any, as the Trustee shall be the
successor to, and be vested with the rights, duties, powers and privileges of,
the Servicer in accordance with the terms of this Agreement.

      Section 8.2 Certain Matters Affecting Trustee. Except as otherwise
provided in Section 8.1:

            (i) Before acting or refraining from acting the Trustee may request
      or require an Officer's Certificate; the Trustee may rely and shall be
      protected in acting or refraining from acting upon any resolution,
      Officer's Certificate, opinion of counsel, certificate of auditors or any
      other certificate, statement, instrument, opinion, report, notice,
      request, consent, order, appraisal, bond or other paper or document
      believed by it to be genuine and to have been signed or presented by the
      proper party or parties;

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

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

            (iv) The right of the Trustee to perform any discretionary act
      enumerated in this Agreement shall not be construed as a duty, and the
      Trustee shall not be answerable for other than its negligence or willful
      misconduct in the performance of such act;

            (v) The Trustee shall not be required to give any bond or surety in
      respect of the execution of the Trust Fund created hereby or the powers
      granted hereunder; and

            (vi) The Trustee may execute any of the trusts or powers hereunder
      or perform any duties hereunder either directly or by or through agents,
      attorneys or custodians, and the Trustee

                                       97
<PAGE>

      shall not be responsible for any misconduct or negligence on the part of
      any such agent, attorney or custodian appointed by the Trustee with care.
      Any such agents, attorneys or custodians shall be entitled to all
      indemnities and protection afforded to the Trustee. Any designee of the
      Trustee shall be considered its "agent" hereunder whether performing
      certain functions as an independent contractor or otherwise.

      Section 8.3 Trustee Not Required to Make Investigation.

      Prior to the occurrence of an Event of Default hereunder and after the
curing of all Events of Default which may have occurred, the Trustee shall not
be bound to ascertain or inquire as to the performance or observance of any of
the terms, conditions, covenants or agreements herein or to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, Mortgage, Mortgage Note or other paper or document, unless
requested in writing so to do by Holders of Certificates having a Percentage
Interest not less than 51% of the Trust Fund; provided, however, that if the
payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such investigation is,
in the opinion of the Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this Agreement, the Trustee may require
reasonable indemnity against such expense or liability as a condition to such
proceeding. The reasonable expense of every such examination shall be paid by
the Depositor or, if paid by the Trustee, shall be repaid by the Depositor upon
demand.

      Section 8.4 Trustee Not Liable for Certificates or Loans.

      The recitals contained herein and in the Certificates (other than the
certificate of authentication on the Certificates) shall be taken as the
statements of the Depositor, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representations or warranties as
to the validity or sufficiency of this Agreement or of the Certificates or of
any Loan or related document. The Trustee shall not be accountable for the use
or application by the Depositor of any of the Certificates or of the proceeds of
such Certificates or for the use or application of any funds paid to the
Servicer in respect of the Loans or deposited in or withdrawn from the Custodial
Account for P&I by the Servicer or for investment of any such amounts. The
Trustee shall not be responsible for the legality or validity of this Agreement
or the validity, priority, perfection or sufficiency of the security for the
Certificates issued or intended to be issued hereunder. The Trustee shall have
no responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection of
any security interest or lien granted to it hereunder or to record this
Agreement.

      Neither the Trustee nor the Custodian nor any of the directors, officers,
employees or agents of the Trustee or the Custodian shall be under any liability
to the Trust Fund or the Certificateholders for any action taken or for
refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment while an Event of Default exists; provided,
however, that this provision shall not protect the Trustee or the Custodian or
any such person against any liability which would otherwise be imposed

                                       98
<PAGE>

by reason of willful misfeasance, bad faith or negligence in the performance of
duties. The Depositor hereby agrees to indemnify and hold harmless the Trustee
and the Custodian and any director, officer, employee or agent of the Trustee
and the Custodian against any loss, liability or expense, including reasonable
attorneys' fees, incurred in connection with or related to the Trustee's or the
Custodian's performance of its powers and duties under this Agreement
(including, without limitation, performance under Section 8.1 hereof), or any
action relating to this Agreement or the Certificates, or the performance of the
Trustee's or the Custodian's duties hereunder, other than any loss, liability or
expense incurred by any such Person by reason of willful misfeasance, bad faith
or negligence in the performance of duties. Any such losses, liabilities and
expenses resulting therefrom shall be losses, liabilities and expenses of the
Depositor. The indemnification provided hereunder shall survive termination of
this Agreement.

      Section 8.5 Trustee May Own Certificates.

      The Trustee and Affiliate or any agent of the Trustee in its individual or
any other capacity may become the owner of or a pledgee of the Certificates with
the same rights it would have if it were not Trustee or such agent, and may
otherwise deal with the parties hereto.

      Section 8.6 Servicer to Pay Trustee's Fees and Expenses.

      The Servicer covenants and agrees to pay to the Trustee and the Custodian
monthly (or as otherwise agreed), and the Trustee and the Custodian shall be
entitled to receive, reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust
or a custodian) for all services rendered by it in the execution of the trusts
hereby created and in the exercise and performance of any of the powers and
duties hereunder of the Trustee and the Custodian (including any custodial
services), and the Servicer shall pay or reimburse the Trustee and the Custodian
upon its request for all reasonable and usual expenses, disbursements and
advances, including reasonable attorneys' fees, incurred or made by the Trustee
and the Custodian in accordance with any of the provisions of this Agreement
(including the reasonable compensation and the expenses and disbursements of its
counsel and of all persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or bad faith. The Tax
Matters Person (or Person acting as its attorney-in-fact or agent) shall
indemnify the Trustee for any liability of or assessment against the Trustee
resulting from any error in any tax or tax information returns prepared or
caused to be prepared by such Person. In the event that (i) the Servicer does
not pay to the Trustee and the Custodian any compensation owed to the Trustee or
the Custodian pursuant to this Agreement or (ii) the Trustee or the Custodian is
not reimbursed for any expense, disbursement or advance incurred or made by the
Trustee or the Custodian pursuant to this Agreement, the Trustee on behalf of
itself and the Custodian shall be entitled to withdraw and retain such amount
from the Certificate Account. In the event the Trustee incurs expenses or
renders services in any proceedings which result from an Event of Default under
Section 7.1, subsections (iii), (iv) or (v) of this Agreement, or from any
default which, with the passage of time, would become an Event of Default, the
expenses so incurred and compensation for services so rendered are intended to
constitute expenses of administration under the United States Bankruptcy Code or
equivalent law.

                                       99
<PAGE>

      Section 8.7 Eligibility Requirements for Trustee.

      The Trustee hereunder shall at all times be a corporation or association
organized and doing business under the laws of any state of the United States of
America, authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $50,000,000 and subject to supervision
or examination by federal or state authority. The Trustee shall not control the
Servicer nor be a parent of or a subsidiary of the Servicer. If such corporation
or association publishes reports of condition at least annually, pursuant to law
or to the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section 8.7 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.7, the Trustee shall resign immediately in the
manner and with the effect specified in Section 8.8.

      Section 8.8 Resignation and Removal of Trustee.

      The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice of resignation to the Servicer. Such
notice shall also be furnished to each Rating Agency. Upon receiving such notice
of resignation, the Servicer shall promptly appoint a successor trustee by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor trustee. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor trustee at the expense of the Depositor.

      If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 8.7 and shall fail to resign after written request for
the Trustee's resignation by the Servicer, or if at any time the Trustee shall
become incapable of acting, or shall be adjudged bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then,
with or without cause, the Servicer may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee.

      The Holders of Certificates having a Percentage Interest aggregating not
less than 51% of the aggregate Denomination of all Certificates may at any time
remove the Trustee and appoint a successor trustee by written instrument or
instruments, in triplicate, signed by such holders or their attorneys-in-fact
duly authorized, one complete set of which instrument or instruments shall be
delivered to the Servicer, one complete set to the Trustee so removed and one
complete set to the successor trustee so appointed.

                                      100
<PAGE>

      Any resignation or removal of the Trustee and appointment of successor
trustee pursuant to any of the provisions of this Section 8.8 shall become
effective only upon acceptance of appointment by the successor trustee as
provided in Section 8.9.

      Section 8.9 Successor Trustee.

      Any successor trustee appointed as provided in Section 8.8 shall execute,
acknowledge and deliver to the Servicer and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee shall become effective, and such successor
trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as trustee herein. The
predecessor trustee shall deliver or cause to be delivered to the successor
trustee all Mortgage Files and related documents and statements held by it
hereunder (other than any Mortgage Files at the time held by the Custodian, if
it shall agree to become the agent of any successor trustee hereunder), and the
Servicer and the predecessor trustee shall execute and deliver such instruments
and do such other things as may reasonably be required for more fully and
certainly vesting and confirming in the successor trustee all such rights,
powers, duties and obligations.

      No successor trustee shall accept appointment as provided in this Section
8.9 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 8.7.

      Upon acceptance of appointment by a successor trustee as provided in this
Section 8.9, the Servicer shall mail notice of the succession of such trustee
hereunder to all holders of Certificates at their addresses as shown in the
Certificate Register and to each Rating Agency. If the Servicer fails to mail
such notice within ten days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the
expense of the Servicer.

      Section 8.10 Merger or Consolidation of Trustee.

      Any Person into which the Trustee may be merged or converted or with which
it may be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
all or substantially all of the corporate trust business of the Trustee, shall
be the successor of the Trustee and the Custodian hereunder, provided, that such
Person shall be eligible under the provisions of Section 8.7, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.

                                      101
<PAGE>

      Section 8.11 Appointment of Co-Trustee or Separate Trustee.

      Notwithstanding any other provisions hereof, at any time, for the purpose
of meeting any legal requirements of any jurisdiction in which any part of the
Trust Fund or property securing the same may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this Section
8.11, such powers, duties, obligations, rights and trusts as the Servicer and
the Trustee may consider necessary or desirable. If the Servicer shall not have
joined in such appointment within 15 days after the receipt by it of a request
so to do, or in case an Event of Default shall have occurred and be continuing,
the Trustee alone shall have the power to make such appointment. Each co-trustee
and separate trustee hereunder shall not be required to meet the terms of
eligibility as a successor trustee under Section 8.7 hereunder and no notice to
holders of Certificates of the appointment of co-trustee(s) or separate
trustee(s) shall be required under Section 8.9 hereof.

      In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Servicer hereunder), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Fund or a
portion thereof in any such jurisdiction) shall be exercised and performed by
such separate trustee or co-trustee at the direction of the Trustee.

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

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

                                      102
<PAGE>

      The Trustee may appoint one or more Eligible Institutions to act as its
agent or agents to perform any or all of its duties and obligations under this
Agreement. Each such agent shall be subject to all of the provisions of this
Agreement, specifically including every provision of this Agreement relating to
the conduct of, affecting the liability of, or affording protection to, the
Trustee.

      Section 8.12 Authenticating Agent.

      (a) The Trustee may appoint from time to time an authenticating agent (the
"Authenticating Agent") which shall be authorized to act on behalf of the
Trustee in authenticating Certificates. Wherever reference is made in this
Agreement to the authentication of Certificates by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication on behalf of the Trustee by the Authenticating Agent and a
certificate of authentication executed on behalf of the Trustee by the
Authenticating Agent. Any successor Authenticating Agent must be acceptable to
the Servicer and have a principal office and place of business in Boston,
Massachusetts, New York, New York or Chicago, Illinois, have a combined capital
and surplus of at least $50,000,000, and be authorized to do a trust business
and subject to supervision or examination by federal or state authorities.

      (b) Any corporation into which the Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate agency business of the Authenticating Agent, shall continue to be
the Authenticating Agent without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.

      (c) The Authenticating Agent may at any time resign by giving at least 30
days' advance written notice of resignation to the Trustee and to the Servicer.
The Trustee may at any time terminate the agency of the Authenticating Agent by
giving written notice of termination to the Authenticating Agent and to the
Servicer. Upon receiving a notice of resignation or upon such a termination, or
in case at any time the Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 8.12, the Trustee promptly shall
appoint a successor Authenticating Agent, shall give written notice of such
appointment to the Servicer and shall mail notice of such appointment to all
Certificateholders. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers, duties
and responsibilities of its predecessor hereunder, with like effect as if
originally named as Authenticating Agent herein. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section
8.12.

      (d) The Authenticating Agent shall have no responsibility or liability for
any action taken by it as such at the direction of the Trustee. Any reasonable
compensation paid to the Authenticating Agent shall be a reimbursable expense
under Section 8.6.

                                      103
<PAGE>

      Section 8.13 Bloomberg.

      As soon as practicable after the Closing Date, the Servicer will arrange
with Bloomberg to have the Depositor set up on Bloomberg to provide the
information set forth on Exhibit Q (the "Data") with respect to the Loans on a
monthly basis in a format acceptable to Bloomberg and acceptable to the
Underwriters. During the term of this Agreement, the Servicer will provide
updated Data to Bloomberg on or before each Distribution Date.

      Section 8.14 The Custodian.

      The rights, privileges, protections, immunities and benefits given to the
Trustee hereunder are extended to, and shall be enforceable by, the Custodian.
In exercising such rights and powers, the Custodian shall use the same degree of
care and skill as similarly situated financial institutions acting in a
comparable capacity. The Custodian's obligations hereunder shall be considered
ministerial in nature, and the Custodian shall have no fiduciary obligation to
the Certificateholders; provided however, this Section shall in no way alter the
fiduciary obligations of the Trustee hereunder.

      Section 8.15 Calculation of LIBOR.

      Until the Certificate Principal Balance of each of the Adjustable Rate
Certificates has been reduced to zero, LIBOR for the initial Interest Accrual
Period shall be 1.10%, and for any Interest Accrual Period thereafter, the
Trustee, if any, shall establish LIBOR on each LIBOR Determination Date as
follows:

      (a) If on such LIBOR Determination Date a rate for United States dollar
deposits for one month appears on the Dow Jones Telerate System, page 3750,
LIBOR for the next Interest Accrual Period shall be equal to such rate as of
11:00 a.m., London time;

      (b) If such rate does not appear on such page (or such other page as may
replace that page on that service, or if such service is no longer offered, such
other service for displaying LIBOR or comparable rates as may be selected by the
Servicer), the rate shall be determined as follows:

            (i) The Servicer on the LIBOR Determination Date will request the
      principal London offices of each of four major reference banks in the
      London interbank market, as selected by the Servicer, to provide the
      Servicer with its offered quotation for deposits in United States dollars
      for the upcoming one-month period, commencing on the second LIBOR Business
      Day immediately following such LIBOR Determination Date, to prime banks in
      the London interbank market at approximately 11:00 a.m. London time on
      such LIBOR Determination Date and in a principal amount that is
      representative for a single transaction in United States dollars in such
      market at such time. If at least two such quotations are provided, LIBOR
      determined on such LIBOR Determination Date will be the arithmetic mean of
      such quotations.

                                      104
<PAGE>

            (ii) If fewer than two quotations are provided, LIBOR determined on
      such LIBOR Determination Date will be the arithmetic mean of the rates
      quoted at approximately 11:00 a.m. in New York City on such LIBOR
      Determination Date by three major banks in New York City selected by the
      Trustee for one-month United States dollar loans to leading European
      banks, in a principal amount that is representative for a single
      transaction in United States dollars in such market at such time;
      provided, however, that if the banks so selected by the Servicer are not
      quoting as mentioned in this sentence, LIBOR determined on such LIBOR
      Determination Date will continue to be LIBOR as then currently in effect
      on such LIBOR Determination Date.

      (c) The establishment of LIBOR on each LIBOR Determination Date by the
Servicer, if any, and the Servicer's calculation of the rate of interest
applicable to the Adjustable Rate Certificates for the related Interest Accrual
Period shall (in the absence of manifest error) be final and binding.

                                      105
<PAGE>

                                   ARTICLE IX

                                   TERMINATION

      Section 9.1 Termination upon Purchase by the Servicer or Liquidation of
All Loans.

      The respective obligations and responsibilities of the Servicer and the
Trustee created hereby (other than the obligation to make payments to
Certificateholders as hereafter set forth in this Section 9.1 and obligations to
the Trustee in Sections 8.4 and 8.6) shall terminate upon the earlier of (i) the
later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Loan remaining in the Trust Fund and the disposition of all
property acquired in respect of any Loan or (ii) the purchase by the Servicer of
all Loans at a price equal to the sum of (a) the principal balance of each Loan
plus accrued interest thereon at the applicable Mortgage Interest Rate to the
next scheduled Due Date and (b) the fair market value of all acquired property
in respect of Loans such fair market value to be determined by an appraiser
selected by the Trustee; provided, however, that in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
last survivor of the descendants of Joseph P. Kennedy, the late ambassador of
the United States to the Court of St. James, living on the date hereof; and
provided, further, that a "plan of liquidation" of REMIC I and REMIC II in
accordance with Section 860F of the Code must be adopted in conjunction with any
termination effected pursuant to subclauses (i) or (ii) of this Section 9.1.

      The Servicer is hereby granted the right to purchase the Loans pursuant to
clause (ii) above, provided, however, that such right shall be conditioned upon
(a) the Principal Balances of such Loans, at the time of any such purchase,
aggregating an amount less than 5% of the aggregate Principal Balance of the
Loans on the Cut-off Date, after deduction of payments due on or before such
date, and (b) the aggregate price in clause (ii) above must be not greater than
the aggregate fair market value of the Loans and all such acquired property.

      Notice of any termination pursuant to clause (i) or (ii) above, specifying
the Distribution Date upon which all Certificateholders may surrender their
Certificates to the Trustee or its agent for payment and cancellation, shall be
given promptly by the Trustee or its agent (upon direction by the Servicer no
less than 10 days prior to the date such notice is to be mailed) by letter to
Certificateholders and each Rating Agency mailed by first class mail no later
than the 25th day of the month preceding the month of such final distribution
specifying (i) the Distribution Date upon which final payment on the
Certificates will be made upon presentation and surrender of Certificates at the
office or agency of the Trustee or the Certificate Registrar therein designated,
(ii) the amount of any such final payment and (iii) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments being
made only upon presentation and surrender of the Certificates at the office or
agency of the Trustee or the Certificate Registrar therein specified. The
Trustee or its agent shall give such notice to the Certificate Registrar and
each Rating Agency at the time such notice is given to the Certificateholders.
Upon any such termination,

                                      106
<PAGE>

the duties of the Certificate Registrar shall also terminate. In the event such
notice is given in connection with Servicer's election to purchase, the Servicer
shall deposit in the Certificate Account on the related Withdrawal Date an
amount equal to the above-described purchase price and upon such deposit
Certificateholders will be entitled to the amount of such purchase price but not
amounts in excess thereof, all as provided herein. With respect to the
Certificates, upon presentation and surrender of the Certificates pursuant to
any termination under this Section 9.1, the Trustee or Paying Agent shall cause
to be distributed to Certificateholders an amount equal to (a) the amount
otherwise distributable on such Distribution Date, if not in connection with a
purchase; or (b) if the Servicer elected to so purchase, the purchase price
calculated as above provided. Upon any termination pursuant to clause (ii)
above, or upon certification to the Trustee by a Servicing Officer following
such final deposit, the Trustee and any Custodian shall promptly release to the
Servicer the Mortgage Files for the remaining Loans, and the Trustee shall
execute all assignments, endorsements and other instruments necessary to
effectuate such transfer.

      In the event that all of the Certificateholders shall not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Trustee or its agent shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within three months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Trustee or its agent shall
take appropriate and reasonable steps as directed by the Servicer, to contact
the remaining Certificateholders concerning surrender of their Certificates, and
the cost thereof shall be paid out of the funds and other assets which remain in
trust hereunder.

      Section 9.2 Trusts Irrevocable.

      Except as expressly provided herein, all trusts created hereby are
irrevocable.

      Section 9.3 Additional Termination Requirements.

      (a) In the event the Servicer exercises its purchase option as provided in
Section 9.1, the Trust Fund shall be terminated in accordance with the following
additional requirements, unless the Trustee has received an Opinion of Counsel
to the effect that the failure of the Trust Fund to comply with the requirements
of this Section 9.3 will not (i) result in the imposition of taxes on
"prohibited transactions" of the Trust Fund as described in Section 860F(a)(2)
of the Code, or (ii) cause REMIC I or REMIC II to fail to qualify as a REMIC at
any time that any Certificates are outstanding:

            (A) Within 90 days prior to the final Distribution Date set forth in
      the notice given by the Depositor under Section 9.1, the Tax Matters
      Person shall prepare the documents associated with and shall adopt a plan
      of complete liquidation of REMIC I or REMIC II; and

            (B) At or after the time of adoption of such a plan of complete
      liquidation and at or prior to the final Distribution Date, the Servicer
      as agent of the Trustee shall sell all of the assets of

                                      107
<PAGE>

      the Trust Fund to the Depositor for cash in accordance with such plan of
      liquidation; provided, however, that in the event that a calendar quarter
      ends after the time of adoption of such a plan of complete liquidation but
      prior to the final Distribution Date, the Servicer shall not sell any of
      the assets of the Trust Fund prior to the close of that calendar quarter.

      (b) The Tax Matters Person hereby agrees to adopt such a plan of complete
liquidation and to take such other action in connection therewith as may be
reasonably requested by the Servicer.

                                      108
<PAGE>

                                    ARTICLE X

                            MISCELLANEOUS PROVISIONS

      Section 10.1 Amendment.

      This Agreement may be amended from time to time by the Depositor, Servicer
and the Trustee, without the consent of any of the Certificateholders, (a) to
cure any ambiguity, to correct or supplement any provision herein which may be
inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Agreement, (b) to
modify, eliminate or add to any provisions to such extent as shall be necessary
to maintain the qualification of each of REMIC I and REMIC II as a REMIC at all
times that any Class A or Subordinate Certificates are outstanding, provided,
that the Trustee has received an Opinion of Counsel to the effect that such
action is necessary or desirable to maintain such qualification, provided, that
such action under clauses (a) and (b) above shall not adversely affect in any
material respect the interests of any Certificateholder or (c) such amendment is
made to conform the terms of this Agreement to the terms described in the
Prospectus dated January 23, 2003, together with the Prospectus Supplement dated
December 22, 2003.

      This Agreement may also be amended from time to time by the Depositor,
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing, in aggregate, not less than 66-2/3% of each Class of Certificates
affected thereby for the purpose of adding any provisions or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Holders of Certificates of such Class; provided,
however, that no such amendment shall (a) reduce in any manner the amount of, or
delay the timing of, payments received on Loans which are required to be
distributed in respect of any Certificate without the consent of the Holder of
such Certificate; (b) adversely affect in any material respect the interest of
the Holders of the Class A Certificates in a manner other than as described in
(a) above without the consent of the Holders of Class A Certificates aggregating
not less than 66-2/3% of the aggregate Percentage Interest evidenced by all
Class A Certificates; (c) adversely affect in any material respect the interest
of the Holders of the Subordinate Certificates in a manner other than as
described in clause (a) above without the consent of the Holders of Subordinate
Certificates aggregating not less than 66-2/3% of the aggregate Percentage
Interest evidenced by all Subordinate Certificates; (d) adversely affect in any
material respect the interest of the Class R Certificateholder without the
consent of the Holder of the Class R Certificate; (e) change in any material
respect the rights and obligations of the Servicer or successor Servicer under
this Agreement without the prior written consent of such party; or (f) reduce
the aforesaid percentage of the Certificates the Holders of which are required
to consent to any such amendments without the consent of the Holders of all
Certificates then outstanding; provided, that for the purposes of this
Agreement, the Holder of the Class R Certificate shall have no right to vote at
all times that any Class A Certificates or Subordinate Certificates are
outstanding if such amendment relates to the modification, elimination or
addition of any provision necessary to maintain the qualification of each of
REMIC I and REMIC II as a REMIC.

                                      109
<PAGE>

      Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel to the effect that such amendment will not cause
either REMIC I or REMIC II to fail to qualify as a REMIC at any time that any
REMIC I Regular Interests or REMIC II Certificates are outstanding.

      As soon as practicable after the execution of any such amendment, the
Trustee shall furnish written notification of the substance of such amendment to
each Certificateholder and each Rating Agency.

      It shall not be necessary for the consent of the Certificateholders under
this Section 10.1 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.

      Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel stating that
the execution of such amendment is authorized or permitted by this Agreement.
The Trustee may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's own rights, duties or immunities under this
Agreement.

      Section 10.2 Recordation of Agreement.

      This Agreement (or an abstract hereof, if acceptable by the applicable
recording office) is subject to recordation in all appropriate public offices
for real property records in all the counties or other comparable jurisdictions
in which any or all of the properties subject to the Mortgages are situated, and
in any other appropriate public recording office or elsewhere, such recordation
to be effected by the Servicer at its expense, but only after the Depositor has
delivered to the Trustee an Opinion of Counsel to the effect that such
recordation materially and beneficially affects the interests of the
Certificateholders.

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

      Section 10.3 Limitation on Rights of Certificateholders.

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

                                      110
<PAGE>

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

      No Certificateholder, solely by virtue of its status as Certificateholder,
shall have any right by virtue or by availing of any provision of this Agreement
to institute any suit, action or proceeding in equity or at law upon or under or
with respect to this Agreement, unless such holder previously shall have given
to the Trustee a written notice of default and of the continuance thereof, as
hereinbefore provided, and unless all of the Holders of Certificates evidencing,
in aggregate, not less than 25% of the Trust Fund shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding; it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more holders of Certificates
shall have any right in any manner whatever by virtue or by availing of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the benefit
of all Certificateholders. For the protection and enforcement of the provisions
of this Section 10.3, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.

      Section 10.4 Governing Law; Jurisdiction.

      THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK (WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES), AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

      Section 10.5 Notices.

      All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered at or mailed by
certified or registered mail, return receipt requested (a) in the case of the
Depositor, to ABN AMRO Mortgage Corporation, 135 South LaSalle Street, Suite
925, Chicago, Illinois 60603, Attention: Maria Fregosi - Director - ABN AMRO
Mortgage Operations, with a copy to LaSalle Bank Corporation, 135 South LaSalle
Street, Chicago, Illinois 60603, Attention: Marlene Ellis - Associate General
Counsel, or such other address as may hereafter be furnished to the

                                      111
<PAGE>

Servicer and the Trustee in writing by the Depositor, (b) in the case of the
Servicer, to Washington Mutual Mortgage Securities Corp., 1201 Third Avenue,
WMT17, Seattle, Washington 98101, Attention: Legal Department, or such other
address as may hereafter be furnished to the Depositor and the Trustee in
writing by the Servicer, (c) in the case of the Trustee, to the Corporate Trust
Office, or such other address as may hereafter be furnished to the Depositor and
the Servicer in writing by the Trustee, in each case Attention: Corporate Trust
Department, (d) in the case of Moody's, to Moody's Investors Service, Inc., 99
Church Street, 4th Floor, New York, New York, 10007, Attention: Asset Backed
Monitoring, or such other address as may hereinafter be furnished to the
Depositor in writing by Moody's and (e) in the case of Fitch, to Fitch, Inc.,
One State Street Plaza, 32nd Floor, New York, New York 10004, Attention: Alla
Sirotic, Residential Mortgage, or such other address as may hereinafter be
furnished to the Depositor in writing by Fitch. Any notice required or permitted
to be mailed to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Certificate Register. Any
notice mailed or transmitted within the time prescribed in this Agreement shall
be conclusively presumed to have been duly given, whether or not the addressee
receives such notice; provided, that any demand, notice or communication to or
upon the Depositor, the Servicer or the Trustee shall not be effective until
received.

      Section 10.6 Severability of Provisions.

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

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      112
<PAGE>

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

                                        ABN AMRO MORTGAGE CORPORATION, as
                                        Depositor

                                        By: /s/ Daniel J. Fischer
                                            ------------------------------------
                                        Name:   Daniel J. Fischer
                                        Its:    Vice President

                                        U.S. BANK NATIONAL ASSOCIATION, as
                                        Trustee and Custodian

                                        By: /s/ Clare M. O'Brien
                                            ------------------------------------
                                        Name:   Clare M. O'Brien
                                        Its:    Vice President

                                        WASHINGTON MUTUAL MORTGAGE
                                        SECURITIES CORP., as Servicer

                                        By: /s/ Thomas G. Lehmann
                                            ------------------------------------
                                        Name:   Thomas G. Lehmann
                                        Its:    First Vice President

                                      113
<PAGE>

STATE OF FLORIDA     )
                          ) ss.
COUNTY OF            )

      On the 23rd day of December, 2003, before me, _________________________,
personally appeared Daniel J. Fischer, a Vice President of ABN AMRO Mortgage
Corporation, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument, and acknowledged to me that he executed the same in his authorized
capacity, and that by his signature on the instrument the person, or the entity
upon behalf of which the person acted, executed the instrument.

      WITNESS my hand and official seal:

                                        Signature ______________________________

                                        (SEAL)

                                      114
<PAGE>

STATE OF MASSACHUSETTS  )
                        ) ss.
COUNTY OF BOSTON        )

      On the 23rd day of December, 2003, before me, __________________________,
personally appeared Clare O'Brien, known to me to be a Vice President of U.S.
Bank National Association, one of the institutions that executed the within
instrument and also known to me to be the person who executed it on behalf of
said institution, and acknowledged to me that such institution executed the
within instrument.

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

                                        ________________________________________
                                        Notary Public

                                        [NOTARIAL SEAL]

                                      115
<PAGE>

STATE OF               )
                       ) ss.
COUNTY OF              )

      On the 23rd day of December, 2003, before me, _________________,
personally appeared _________________, known to me to be a _________________ of
Washington Mutual Mortgage Securities Corp., one of the corporations that
executed the within instrument and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.

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

                                        ________________________________________
                                        Notary Public

                                        [NOTARIAL SEAL]

                                      116
<PAGE>

                                   EXHIBIT A-1

                                                                  CUSIP ________

                FORM OF SENIOR AND SENIOR SUBORDINATE CERTIFICATE
                        MORTGAGE PASS-THROUGH CERTIFICATE

                            Class [A-[__], M, B-[__]]

Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by

                          ABN AMRO MORTGAGE CORPORATION

This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is December 23, 2003. [The rate at
which interest is payable as of the Issue Date with respect to this Certificate
is [___]% per annum.][Interest is not payable with respect to this Certificate.]

[Unless this Certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Trustee or its
agent for registration of transfer, exchange, or payment, and any Certificate
issued is registered in the name of Cede & Co. or such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]

[The Class [M, B-[__]] Certificates will be subordinate in right of payment to
and provide credit support to certain Classes of Certificates, as described in
the Pooling Agreement.

Series 20[__-__]                        Portion of the Class A-[__] [Principal
                                        Balance][Notional Amount] as of the
                                        Cut-Off Date evidenced by this
                                        Certificate:
                                        $________________

Class A-[__] Remittance Rate:      [___]%
Cut-Off Date:                           [__________]
First Distribution Date:           [__________]
Last Scheduled Distribution Date:       [__________]

Class A-[__] [Principal Balance][Notional Amount] as of the Cut-Off Date:
$______________

                                ----------------
                                Registered Owner              Certificate No.___

                                      A-1
<PAGE>

                                   EXHIBIT A-2

                                                                    CUSIP_______

                     FORM OF JUNIOR SUBORDINATE CERTIFICATE
                        MORTGAGE PASS-THROUGH CERTIFICATE

                                  Class B-[__]

Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by

                          ABN AMRO MORTGAGE CORPORATION

This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is December 23,
2003. The rate at which interest is payable as of the Issue Date with respect to
this Certificate is [___]% per annum.

IN THE CASE OF ANY CLASS B-[__] CERTIFICATE PRESENTED FOR REGISTRATION IN THE
NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED TRANSACTION
PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER
PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION,
THE TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN
OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING
THAT THE TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND III
OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN EXPENSE OF THE
TRUSTEE OR THE DEPOSITOR.

The Class B-[__] Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.

                                      A-2
<PAGE>

Series 20[__-__]                        Portion of the Class B-[__] Principal
                                        Balance as of the Cut-Off Date evidenced
                                        by this Certificate:
                                        $__________________

Class B-[__] Remittance Rate:      [____]%
Cut-Off Date:                           [___________]
First Distribution Date:           [____________]
Last Scheduled Distribution Date:       [____________]

Class B-[__] Principal Balance as of the Cut-Off Date: $________________

                                ----------------
                                Registered Owner              Certificate No.___

                                      A-3
<PAGE>

                                    EXHIBIT B

                          FORM OF RESIDUAL CERTIFICATE

                  MORTGAGE PASS-THROUGH CERTIFICATE CUSIP_____

                                     Class R

Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to-four family mortgage loans formed and administered by

                          ABN AMRO MORTGAGE CORPORATION

ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE DEPOSITOR AND
THE CERTIFICATE REGISTRAR THAT (1) SUCH TRANSFEREE IS NOT EITHER (A) THE UNITED
STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE CODE (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B), OR (C) BEING
HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A
DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO ENABLE THE
TRANSFER TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL
INCLUDE CERTAIN REPRESENTATIONS AS TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF A CLASS R CERTIFICATE BY ACCEPTANCE OF THIS
CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.

IN THE CASE OF ANY CLASS R CERTIFICATE PRESENTED FOR REGISTRATION IN THE NAME OF
AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED TRANSACTION
PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT

                                      B-4
<PAGE>

OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE
PROVISIONS OF ANY SUBSEQUENT ENACTMENTS) (A "PLAN"), OR A TRUSTEE OF ANY SUCH
PLAN, OR ANY OTHER PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH PLAN TO EFFECT
SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH
TRANSFEREE TO PROVIDE AN OPINION OF COUNSEL ACCEPTABLE TO AND IN FORM AND
SUBSTANCE SATISFACTORY TO THE TRUSTEE, THE DEPOSITOR AND THE SERVICER TO THE
EFFECT THAT THE PURCHASE OR HOLDING OF SUCH CLASS R CERTIFICATE IS PERMISSIBLE
UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN ANY NON-EXEMPT PROHIBITED
TRANSACTION UNDER SECTION 406 OF ERISA, OR SECTION 4975 OF THE CODE (OR
COMPARABLE PROVISIONS OF ANY SUBSEQUENT ENACTMENTS), AND WILL NOT SUBJECT THE
TRUSTEE, THE DEPOSITOR OR THE SERVICER TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE) IN ADDITION
TO THOSE UNDERTAKEN IN THE AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE TRUSTEE, THE DEPOSITOR OR THE SERVICER. EACH PERSON WHO ACQUIRES
THIS CERTIFICATE SHALL BE DEEMED TO CERTIFY THAT IT MEETS THE FOREGOING
CONDITIONS, AND THAT IT WILL NOT TRANSFER SUCH CERTIFICATE IN VIOLATION OF THE
FOREGOING.

Solely for U.S. federal income tax purposes, this Certificate represents
"residual interests" in "real estate mortgage investment conduits," as those
terms are defined in Sections 860G and 860D, respectively, of the Internal
Revenue Code of 1986, as amended.

Series 20[__-__] Percentage Interest evidenced by this Class R Certificate in
the distributions to be made with respect to the Class R Certificate: [____]%

Class R Remittance Rate: [___]% Additionally, the Class R Certificates are
entitled to Excess Liquidation Proceeds and the Residual Distribution Amount as
defined in the Pooling Agreement.

Cut-Off Date:                        [__________]

First Distribution Date:                    [__________]

Last Scheduled Distribution Date:           [___________]

Class R Principal Balance as of the Cut-Off Date: $100

                                ----------------
                                Registered Owner              Certificate No.___

                                      B-5
<PAGE>

                                   EXHIBIT C-1

                    FORM OF CUSTODIAN'S INITIAL CERTIFICATION

                                                        [Date]

ABN AMRO Mortgage Corporation
135 South LaSalle Street, Suite 925
Chicago, IL 60603

      Re:   Pooling and Servicing Agreement, dated as of December 1, 2003, among
            ABN AMRO Mortgage Corporation, Washington Mutual Mortgage Securities
            Corp. and U.S. Bank National Association, Multi-Class Mortgage
            Pass-Through Certificates, Series 2003-13

Ladies and Gentlemen:

            Pursuant to Section 2.1 of the Pooling and Servicing Agreement,
dated as of December 1, 2003, among ABN AMRO Mortgage Corporation as Depositor,
Washington Mutual Mortgage Securities Corp., as seller and servicer and U.S.
Bank National Association as trustee, we hereby acknowledge that as to each
Mortgage Loan listed in the Loan Schedule (other than any Mortgage Loan paid in
full or any Mortgage Loan specifically identified in the exception report
annexed thereto as not being covered by such certification), (i) the documents
constituting part of the Mortgage File described in Sections 2.1(i) and (ii)(b)
required to be delivered to it pursuant to this Agreement are in its possession
except as otherwise set forth in the Schedule hereto, (ii) such documents have
been reviewed by it and are not mutilated, torn or defaced unless initialed by
the related borrower and relate to such Mortgage Loan, and (iii) based on its
examination of the information set forth in the Loan Schedule accurately
reflects information set forth in such portions of the Mortgage File.

            The Custodian was under no duty or obligation (i) to inspect, review
or examine any such documents, instruments, certificates or other papers to
determine whether they are genuine, enforceable, or appropriate for the
represented purpose or whether they have actually been recorded or that they are
other than what they purport to be on their face or (ii) to determine whether
any Mortgage File should include any of the documents specified in clause (v) of
Section 2.1.

                                     C-1-1
<PAGE>

            Capitalized terms used but not defined herein shall have the
meanings assigned to them in the Pooling and Servicing Agreement.

                                        U.S. BANK NATIONAL ASSOCIATION, as
                                        Custodian

                                        By:__________________________________
                                        Name:
                                        Title:

                                     C-1-2
<PAGE>

                                   EXHIBIT C-2

                          FORM OF INTERIM CERTIFICATION

                                     [Date]

ABN AMRO Mortgage Corporation         U.S. Bank National Association, as Trustee
135 South LaSalle Street              1 Federal Street, 3rd Floor
Suite 925                             Boston, MA 02110
Chicago, Illinois 60603               Attn: Corporate Trust Services, ABN AMRO
                                      2003-13

Attention: ABN AMRO Mortgage Corporation, Multi-Class Mortgage Pass-Through
Certificates, Series 2003-13

      Re:   Pooling and Servicing Agreement, dated as of December 1, 2003, by
            and among ABN AMRO Mortgage Corporation, ABN Washington Mutual
            Mortgage Securities Corp. and U.S. Bank National Association
            relating to ABN AMRO Mortgage Corporation, Multi-Class Mortgage
            Pass-Through Certificates, Series 2003-13

Ladies and Gentlemen:

      In accordance with Section 2.3 of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Custodian, hereby certifies that it or
the sub-custodian has received a Mortgage File with respect to each Loan listed
in the Mortgage Loan Schedule containing with respect to each such Loan:

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

            ii. The original Mortgage with evidence of recording indicated
      thereon or a copy of the Mortgage certified by the public recording office
      in which such mortgage has been recorded;

                                      C-2-1
<PAGE>

            iii. An original Assignment of the Mortgage to the Trustee with
      evidence of recording indicated thereon or a copy of such assignment
      certified by the public recording office in which such assignment has been
      recorded;

            iv. With respect to each Mortgage Loan, to the extent available, the
      original recorded assignment or assignments of the Mortgage showing an
      unbroken chain of title from the originator thereof to the Person
      assigning it to the Trustee or a copy of such assignment or assignments of
      the Mortgage certified by the public recording office in which such
      assignment or assignments have been recorded; and

            v. The original of each modification, assumption, extension or
      guaranty agreement, if any, relating to such Loan or a copy of each
      modification, assumption, extension or guaranty agreement certified by the
      public recording office in which such document has been recorded.

            Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.

                                        U.S. BANK NATIONAL ASSOCIATION

                                        By: ____________________________________
                                        Name:
                                        Title:

                                     C-2-2
<PAGE>

                                   EXHIBIT C-3

                           FORM OF FINAL CERTIFICATION

                                            [Date]

ABN AMRO Mortgage Corporation         U.S. Bank National Association, as Trustee
135 South LaSalle Street              1 Federal Street, 3rd Floor
Suite 925                             Boston, MA 02110
Chicago, Illinois 60603               Attn: Corporate Trust Services, ABN AMRO
                                      2003-13

Attention: ABN AMRO Mortgage Corporation, Multi-Class Mortgage Pass-Through
Certificates, Series 2003-13

      Re:   Pooling and Servicing Agreement, dated as of December 1, 2003, by
            and among ABN AMRO Mortgage Corporation, Washington Mutual Mortgage
            Securities Corp. and U.S. Bank National Association relating to ABN
            AMRO Mortgage Corporation, Multi-Class Mortgage Pass-Through
            Certificates, Series 2003-13

Ladies and Gentlemen:

            In accordance with Section 2.3 of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Custodian, hereby certifies that it or
the sub-custodian has received a Mortgage File with respect to each Loan listed
in the Mortgage Loan Schedule containing with respect to each such Loan:

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

            ii. The original Mortgage with evidence of recording indicated
      thereon or a copy of the Mortgage certified by the public recording office
      in which such mortgage has been recorded;

            iii. An original Assignment of the Mortgage to the Trustee with
      evidence of recording indicated thereon or a copy of such assignment
      certified by the public recording office in which such assignment has been
      recorded;

                                     C-2-1
<PAGE>

            iv. With respect to each Mortgage Loan, to the extent available, the
      original recorded assignment or assignments of the Mortgage showing an
      unbroken chain of title from the originator thereof to the Person
      assigning it to the Trustee or a copy of such assignment or assignments of
      the Mortgage certified by the public recording office in which such
      assignment or assignments have been recorded; and

            v. The original of each modification, assumption, extension or
      guaranty agreement, if any, relating to such Loan or a copy of each
      modification, assumption, extension or guaranty agreement certified by the
      public recording office in which such document has been recorded.

            Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.

                                        U.S. BANK NATIONAL ASSOCIATION

                                        By: ____________________________________
                                        Name:
                                        Title:

                                      C-2-2
<PAGE>

                                    EXHIBIT D

                                SCHEDULE OF LOANS

                                       D-1
<PAGE>

                                    EXHIBIT E

                           FIELDS OF LOAN INFORMATION

Deal Name
Distribution Date
Loan Number
City
State
Zip Code
Property Type (SFR, CONDO, etc.)
Occupancy Status (Owner, Investor, etc.)
Loan Purpose (Purchase, Refi, etc.)
Loan Type Loan Status (Current, Foreclosure, REO, Bankruptcy)
Original Term of Loan
Amortization Term
First Payment of Loan
Maturity Date
Appraisal Value
Original LTV
Original Principal Balance
Previous Month's Balance
Current Principal Balance
Prepay Date
Prepay Status (Loan has been prepaid, liquidated or repurchased by the Servicer)
Original Scheduled P&I
Current Scheduled P&I
Scheduled Interest Amount
Scheduled Principal Amount
Curtailment
Note Rate
Paid to Date
Payment Date

                                       E-1
<PAGE>

                                    EXHIBIT F

                       FORM OF TRANSFEROR CERTIFICATE FOR
                         PRIVATELY OFFERED CERTIFICATES

[Date]

U.S. Bank National Association, as Trustee
1 Federal Street, 3rd Floor
Boston, MA 02110
Attn: Corporate Trust Services, ABN AMRO 2003-13

      Re:   Purchase of ABN AMRO Mortgage Corporation Mortgage Pass-Through
            Certificates Series 2003-13, Class [B-3] [B-4] [B-5] (the
            "Certificates")

Ladies and Gentlemen:

      In connection with our disposition of the above Certificates we certify
that (a) we understand the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act") and are being disposed by us in a
transaction that is exempt from the registration requirements of the Act, and
(b) we have not offered or sold any certificates to, or solicited offers to buy
any Certificates from, any person, or otherwise approached or negotiated with
any person with respect thereto, or taken any other action which would result in
a violation of Section 5 of the Act.

Very truly yours,

[Name of Transferor]

By: _______________________________
Authorized Officer

                                       F-1
<PAGE>

                                    EXHIBIT G

                      FORM OF TRANSFEREE'S CERTIFICATE FOR
                         PRIVATELY OFFERED CERTIFICATES

[Date]

U.S. Bank National Association
1 Federal Street, 3rd Floor
Boston, MA 02110
Attn: Corporate Trust Services, ABN AMRO 2003-13

ABN AMRO Mortgage Corporation
135 South LaSalle Street, Suite 925
Chicago, IL 60603

      The undersigned (the "Purchaser") proposes to purchase [Class B-3] [Class
B-4] [Class B-5] Certificates evidencing an undivided interest in ABN AMRO
Mortgage Corporation Mortgage Pass-Through Certificates, Series 2003-13 (the
"Purchased Certificates") in the principal amount of $__________. In doing so,
the Purchaser hereby acknowledges and agrees as follows:

      Section 1. Definitions. Each capitalized term used herein and not
otherwise defined herein shall have the meaning ascribed to it in the Pooling
and Servicing Agreement, dated as of December 1, 2003, between ABN AMRO Mortgage
Corporation ("AAMC"), Washington Mutual Mortgage Securities Corp., as servicer
(the "Servicer") and U.S. Bank National Association, as trustee (the "Trustee"),
of the ABN AMRO Mortgage Corporation Mortgage Pass-Through Certificates, Series
2003-13.

      Section 2. Representations and Warranties of the Purchaser. In connection
with the proposed transfer, the Purchaser represents and warrants to AAMC, the
Servicer, the Certificate Registrar and the Trustee that:

      (a) The Purchaser is duly organized, validly existing and in good standing
under the laws of the jurisdiction in which the Purchaser is organized, is
authorized to invest in the Purchased Certificates, and to enter into this
Agreement, and duly executed and delivered this Agreement;

      (b) The Purchaser is acquiring the Purchased Certificates for its own
account as principal and not with a view the distribution thereof, in whole or
in part;

      (c) The Purchaser is an "accredited investor" as such term is defined in
paragraph (a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) of Section 501 of Regulation
D under the Securities Act of 1933, as amended (the

                                       G-1
<PAGE>

"Act"), has knowledge of financial and business matters and is capable of
evaluating the merits and risks of an investment in the Purchased Certificates;
the Purchaser has sought such accounting, legal and tax advice as it has
considered necessary to make an informed investment decision; and the Purchaser
is able to bear the economic risk of an investment in the Purchased Certificates
and can afford a complete loss of such investment;

      (d) The Purchaser is not affiliated with the Trustee;

      (e) The Purchaser confirms that AAMC has made available to the Purchaser
the opportunity to ask questions of, and receive answers from AAMC concerning
the Trust, the purchase by the Purchaser of the Purchased Certificates and all
matters relating thereto that AAMC possesses or can acquire without unreasonable
effort or expense;

      (f) If applicable, the Purchaser has complied, and will continue to
comply, with the guidelines established by Thrift Bulletin 12 issued December
13, 1988, by the Office of Regulatory Activities of the Federal Home Loan Bank
System; and

      (g) The Purchaser will provide the Trustee and the Servicer with
affidavits substantially in the form of Exhibit A attached hereto.

      Section 3. Transfer of Purchased Certificates.

      (a) The Purchaser understands that the Purchased Certificates have not
been registered under the Act, or any state securities laws and that no transfer
may be made unless the Purchased Certificates are registered under the Act and
under applicable state law or unless an exemption from registration is
available. The Purchaser further understands that neither AAMC nor the Trust is
under any obligation to register the Purchased Certificates or make an exemption
available. In the event that such a transfer is to be made within two years from
the Closing Date without registration under the Act or applicable state
securities laws, (i) the Trustee or the Certificate Registrar shall require, in
order to assure compliance with such laws, that the Certificateholder's
prospective transferees each certify to AAMC, the Certificate Registrar and the
Trustee as to the factual basis for the registration or qualification exemption
relied upon, and (ii) the Trustee, the Certificate Registrar or AAMC may require
an Opinion of Counsel that such transfer may be made pursuant to an exemption
from the Act and state securities laws, which Opinion of Counsel shall not be an
expense of the Trustee, the Certificate Registrar or AAMC. Any such
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee and AAMC against any liability that may result if the
Transfer is not so exempt or is not made in accordance with such federal and
state laws.

      (b) No transfer of a Purchased Certificate shall be made unless the
transferee provides AAMC, the Certificate Registrar and the Trustee with (i) a
Transferee's Agreement, substantially in the form of this Agreement, and (ii) an
affidavit substantially in the form of Exhibit A hereto that the proposed
transferee

                                       G-2
<PAGE>

(x) is not an employee benefit plan or other plan or arrangement subject to the
prohibited transaction provisions of ERISA or Section 4975 of the Internal
Revenue Code of 1986, as amended, or comparable provisions of any subsequent
enactments (a "Plan"), a trustee of any Plan, or any other Person who is using
the "plan assets" of any Plan to effect such acquisition or (y) is an insurance
company, the source of funds to be used by it to purchase the Purchased
Certificates is an "insurance company general account" (within the meaning of
Department of Labor Prohibited Transaction Class Exemption ("PTCE") 95-60), and
is eligible for, and satisfies all the requirements for, exemptive relief under
Sections I and III of PTCE 95-60.

      (c) The Purchaser acknowledges that its Purchased Certificates bear a
legend setting forth the applicable restrictions on transfer.

      IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
validly executed by its duly authorized representative as of the day and the
year first above written.

[Purchaser]

By: __________________________
Its:

                                       G-3
<PAGE>

              Exhibit A to Form of Transferee Agreement (Exhibit G)

                             BENEFIT PLAN AFFIDAVIT

RE:   ABN AMRO Mortgage Corporation Mortgage Pass-through Certificates, Series
      2003-13 (The "Trust") [Class B-3] [Class B-4] [Class B-5] Certificates
      (The "Purchased Certificates")

      Under penalties of perjury, I, , declare that, to the best of my knowledge
and belief, the following representations are true, correct and complete; and

      1. That I am the of (the "Purchaser"), whose taxpayer identification
number is , and on behalf of which I have the authority to make this affidavit.

      2. That the Purchaser is acquiring a Purchased Certificate representing an
interest in Trust.

      3. That the Purchaser (i) is not an employee benefit plan or other plan or
arrangement subject to the prohibited transaction provisions of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or Section 4975 of
the Internal Revenue Code of 1986, as amended (the "Code"), or comparable
provisions of any subsequent enactments (a "Plan"), a trustee of any Plan, or
any other Person who is using the "plan assets" of any Plan to effect such
acquisition, or (ii) has provided an Officer's Certificate signed by a
Responsible Officer of the Purchaser satisfactory to ABN AMRO Mortgage
Corporation (the "Depositor"), the Certificate Registrar, and the Trustee of the
Trust stating that the Purchaser is an insurance company using assets of an
"insurance company general account" (within the meaning of Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) to effect such purchase
and is eligible for, and satisfies all of the requirements for exemptive relief
under Sections I and III of PTCE 95-60, which Officer's Certificate shall not be
an expense of the Depositor or the Trustee.

      IN WITNESS WHEREOF, the Purchaser has caused this instrument to be duly
executed on its behalf, by its duly authorized officer this ___ day of
__________, 20__.

                                        [Purchaser]

                                        By: ____________________________________
                                        Its:

                                       G-4
<PAGE>

      Personally appeared before me _____________________, known or proved to me
to be the same person who executed the foregoing instrument and to be a
__________________________ of the Purchaser, and acknowledged to me that (s)he
executed the same as his/her free act and deed and as the free act and deed of
the Purchaser.

      SUBSCRIBED and SWORN to before me this __ day of ______________, 20__.

                                        ________________________________________
                                                Notary Public

                                       G-5
<PAGE>

                                    EXHIBIT H
                                   [RESERVED]

                                       H-1
<PAGE>

                                    EXHIBIT I

                         FORM OF TRANSFEROR CERTIFICATE

[Date]

U.S. Bank National Association, as Certificate Registrar
1 Federal Street, 3rd Floor
Boston, MA 02110
Attn: Corporate Trust Services, ABN AMRO 2003-13

      RE:   ABN AMRO Mortgage Corporation Mortgage Pass-through Certificates,
            Series 2003-13 Class R

      This letter is delivered to you in connection with the sale by
____________ (the "Seller") to _____________________ (the "Purchaser") of
$________ initial Certificate Principal Balance of Mortgage Pass-Through
Certificates, Series 2003-13, Class R (the "Certificate"), pursuant to Section
5.1 of the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of December 1, 2003 among ABN AMRO Mortgage Corporation,
as depositor (the "Company"), Washington Mutual Mortgage Securities Corp., as
servicer (the "Servicer"), and U.S. Bank National Association, as trustee (the
"Trustee"). All terms used herein and not otherwise defined shall have the
meanings set forth in the Pooling and Servicing Agreement. The Seller hereby
certifies, represents and warrants to, and covenants with the Depositor, the
Servicer, the Certificate Registrar and the Trustee that:

      1. No purpose of the Seller relating to the sale of the Certificate by the
Seller to the Purchaser is or will be to enable the Seller to impede the
assessment or collection of tax.

      2. The Seller understands that the Purchaser has delivered to the Trustee,
the Servicer, the Certificate Registrar and the Depositor a transferee affidavit
and agreement in the form attached to the Pooling and Servicing Agreement as
Exhibit J. The Seller does not know or believe that any representation contained
therein is false.

      3. The Seller has no actual knowledge that the Proposed Transferee is not
a Permitted Transferee.

      4. The Seller has no actual knowledge that the Purchaser would be
unwilling or unable to pay taxes due on its share of the taxable income
attributable to the Certificates.

      5. At the time of this transfer (i) the Seller has conducted a reasonable
investigation of the financial condition of the Purchaser and, as a result of
the investigation, found that the Purchaser has historically paid its debts as
they came due, and found no significant evidence to indicate that the Purchaser
will not continue to pay its debts as they come due in the future, and (ii)
either (A) the Seller both (1) has determined all of

                                       I-1
<PAGE>

the following (I) at the time of the transfer, and at the close of each of the
Purchaser's two fiscal years preceding the year of transfer, the Purchaser's
gross assets for financial reporting purposes exceed $100 million and its net
assets for such purposes exceed $10 million (disregarding, for purposes of
determining gross or net assets, the obligation of any person related to the
Purchaser within the meaning of section 860L(g) of the Code or any other asset
if a principal purpose for holding or acquiring that asset is to permit the
Purchaser to satisfy this minimum gross asset or net asset requirement), (II)
the Purchaser is a domestic C corporation for United States federal income tax
purposes that is not for such purposes an exempt corporation, a regulated
investment company, a real estate investment trust, a REMIC, or a cooperative
organization to which part I of subchapter T of the Code applies, (III) there
are no facts or circumstances on or before the date of transfer (or anticipated)
which would reasonably indicate that the taxes associated with the Certificates
will not be paid, (IV) the Purchaser is not a foreign branch of a domestic
corporation, and (V) the transfer does not involve a transfer or assignment to a
foreign branch of a domestic corporation (or any other arrangement by which any
Certificate is at any time subject to net tax by a foreign country or U.S.
possession) and the Purchaser will not hereafter engage in any such transfer or
assignment (or any such arrangement), and (2) does not know or have reason to
know that the Purchaser will not honor the restrictions on subsequent transfers
of any Class R Certificate described in paragraph 12 and 13 of the Transferee's
Transfer Affidavit, or (B) the Seller has determined that the present value of
the anticipated tax liabilities associated with the holding of the Certificates
do not exceed the sum of (1) the present value of any consideration given to the
Purchaser to acquire the Certificates, (2) the present value of the expected
future distributions on the Certificates, and (3) the present value of the
anticipated tax savings associated with holding the Certificates as each REMIC
generates losses (having made such determination by (I) assuming that the
Purchaser pays tax at a rate equal to the highest rate of tax specified in
Section 11(b)(1) of the Code, and (II) utilizing a discount rate for present
valuation purposes equal to the applicable Federal rate prescribed by Section
1274(d) of the Code compounded semi-annually (or a lower discount rate based on
the Purchaser having demonstrated that it regularly borrows, in the course of
its trade or business, substantial funds at such lower rate from unrelated third
parties)).

      6. The Purchaser has represented to the Seller that, if the Certificates
constitute a noneconomic residual interest, it (i) understands that as holder of
a noneconomic residual interest it may incur tax liabilities in excess of any
cash flows generated by the interest, and (ii) intends to pay taxes associated
with its holding of the Certificates as they become due.

      7. The Seller understands that the transfer of the Certificates may not be
respected for United States income tax purposes (and the Seller may continue to
be liable for United States income taxes associated therewith) unless there is
compliance with the standards of paragraph 5 above as to any transfer.

                                        Very truly yours,

                                  [Seller]
                                  By: __________________________
                                  Name:
                                  Title:

                                       J-1
<PAGE>

                                    EXHIBIT J

                   FORM OF TRANSFEREE AFFIDAVIT AND AGREEMENT

STATE OF        )
                ) ss.
COUNTY OF       )

      [NAME OF OFFICER], being first duly sworn, deposes and says:

      1. That he is [Title of Officer] of [Name of Owner] (record or beneficial
owner of the Class R Certificate (the "Owner")), a [savings institution]
[corporation] duly organized and existing under the laws of [the State of ] [the
United States], on behalf of which he makes this affidavit and agreement.

      2. That the Owner (i) is not and will not be a "disqualified organization"
as of the [date of transfer] within the meaning of Section 860E(e)(5) of the
Internal Revenue Code of 1986, as amended (the "Code") and will endeavor to
remain other than a disqualified organization for so long as it retains its
ownership interest in the Class R Certificate, and (ii) is acquiring the Class R
Certificate for its own account or for the account of another Owner from which
it has received an affidavit and agreement in substantially the same form as
this affidavit and agreement. (For this purpose, a "disqualified organization"
means the United States, any state or political subdivision thereof, or any
agency or instrumentality of any of the foregoing (other than an instrumentality
all of the activities of which are subject to tax and, except for the Federal
Home Loan Mortgage Corporation, a majority of whose board of directors is not
selected by any such governmental entity, or any foreign government or
international organization, or any agency or instrumentality of such foreign
government or organization, any rural electric or telephone cooperative, or any
organization (other than certain farmers' cooperatives) that is generally exempt
from federal income tax unless such organization is subject to the tax on
unrelated business taxable income).

      3. That the Owner is aware (i) of the tax that would be imposed on
transfers of the Class R Certificate; (ii) that such tax would be on the
transferor, or, if such transfer is through an agent (which person includes a
broker, nominee or middleman) for a disqualified organization, on the agent;
(iii) that the person otherwise liable for the tax shall be relieved of
liability for the tax if the transferee furnished to such person an affidavit
that the transferee is not a disqualified organization and, at the time of
transfer, such person does not have actual knowledge that the affidavit is
false; and (iv) that the Class R Certificate may represent "noneconomic residual
interests" within the meaning of Treasury regulations promulgated pursuant to
the Code and that the transferor of a noneconomic residual interest will remain
liable for any taxes due with respect to the income on such residual interest,
if a significant purpose of the transfer was to enable the transferor to impede
the assessment or collection of tax.

      4. That the Owner is aware of the tax imposed on a "pass-through entity"
holding the Class R Certificate if at any time during the taxable year of the
pass-through entity a disqualified organization is the record holder of an
interest in such entity. (For this purpose, a "pass-through entity" includes a
regulated

                                       J-2
<PAGE>

investment company, a real estate investment trust or common trust fund, a
partnership, trust or estate, and certain cooperatives.)

      5. That the Owner is aware that the Trustee and the Certificate Registrar
will not register the transfer of the Class R Certificate unless the transferee,
or other transferee's agent, delivers to each of them an affidavit and
agreement, among other things, in substantially the same form as this affidavit
and agreement. The Owner expressly agrees that it will not consummate any such
transfer if it knows or believes that any of the representations contained in
such affidavit and agreement are false.

      6. That the Owner has reviewed the restrictions set forth on the face of
each Class R Certificate and the provisions of Section 5.1 of the Pooling and
Servicing Agreement under which the Class R Certificates was issued. The Owner
expressly agrees to be bound by and to comply with such restrictions and
provisions.

      7. That the Owner consents to any additional restrictions or arrangements
that shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that such Class R Certificate will only be owned, directly
or indirectly, by an Owner that is not a disqualified organization.

      8. The Owner's Taxpayer Identification Number is ____________ .

      9. That no purpose of the Owner relating to the purchase of the Class R
Certificate by the Owner is or will be to enable the transferor to impede the
assessment or collection of tax.

      10. That the Owner has no present knowledge or expectation that it will be
unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding.

      11. That the Owner has no present knowledge or expectation that it will
become insolvent or subject to a bankruptcy proceeding for so long as any of the
Certificates remain outstanding.

      12. The Owner will, in connection with any transfer that it makes of the
Class R Certificate, deliver to the Certificate Registrar a representation
letter substantially in the form of Exhibit I to the Pooling and Servicing
Agreement. [The Owner hereby agrees that it will not make any transfer of any
Class R Certificate unless (i) the transfer is to an entity which is a domestic
C corporation (other than an exempt corporation, a regulated investment company,
a real estate investment trust, a REMIC, or a cooperative organization to which
part I of Subchapter T of the Code applies) for federal income tax purposes, and
(ii) the transfer is in compliance with the conditions set forth in paragraph 5
of Exhibit I of the Pooling and Servicing Agreement.]

----------

      13. The Owner (i) is a citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for federal income tax purposes) created or

                                       J-3
<PAGE>

organized in, or under the laws of, the United States or any state thereof or
the District of Columbia (except, in the case of a partnership, to the extent
provided in regulations) or an estate whose income is subject to United States
federal income tax regardless of its source, or a trust if a court within the
United States is able to exercise primary supervision over the administration of
the trust and one or more such U.S. Persons have the authority to control all
substantial decisions of the trust, and (ii) if the Owner is a partnership for
U.S. federal income tax purposes, each person or entity which holds an interest
(directly or indirectly, through a pass-through entity) is a person or entity
described in (i). To the extent prescribed in regulations by the Secretary of
the Treasury, which have not yet been issued, a trust which was in existence on
August 20, 1996 (other than a trust treated as owned by the grantor under
subpart E of part 1 of subchapter J of chapter 1 of the Code), and which was
treated as a U.S. Person on August 20, 1996 may elect to continue to be treated
as a U.S. Person notwithstanding the previous sentence.

      14. The Owner hereby agrees to cooperate with the Depositor and to take
any action required of it by the Code or Treasury regulations thereunder
(whether now or hereafter promulgated) in order to create or maintain the REMIC
status of the REMIC I or the REMIC II.

      15. The Owner hereby agrees that it will not take any action that could
endanger the REMIC status of the REMIC I or the REMIC II, as applicable, or
result in the imposition of tax on the REMIC I or the REMIC II unless counsel
for, or acceptable to, the Depositor has provided an opinion that such action
will not result in the loss of such REMIC status or the imposition of such tax,
as applicable.

      16. The Owner as transferee of the Class R Certificate has represented to
their transferor that, if a Class R Certificate represents noneconomic residual
interests, the Owner (i) understands that as holder of a noneconomic residual
interest it may incur tax liabilities in excess of any cash flows generated by
the interest, and (ii) intends to pay taxes associated with its holding of the
Class R Certificate as they become due.

      [17. The Owner hereby represents to and for the benefit of the transferor
that (i) at the time of the transfer, and at the close of each of the Owners's
two fiscal years preceding the year of transfer, the Owners's gross assets for
financial reporting purposes exceed $100 million and its net assets for such
purposes exceed $10 million (disregarding, for purposes of determining gross or
net assets, the obligation of any person related to the Owner within the meaning
of section 860L(g) of the Code or any other asset if a principal purpose for
holding or acquiring that asset is to permit the Owner to satisfy this minimum
gross asset or net asset requirement), (ii) the Owner is a domestic C
corporation for United States federal income tax purposes that is not for such
purposes an exempt corporation, a regulated investment company, a real estate
investment trust, a REMIC, or a cooperative organization to which part I of
subchapter T of the Code applies, (iii) there are no facts or circumstances on
or before the date of transfer (or anticipated) which would reasonably indicate
that the taxes associated with the Class R Certificate will not be paid, and
(iv) the Owner is not a foreign branch of a domestic corporation, the transfer
does not involve a transfer or assignment to a foreign branch of a domestic
corporation (or any other arrangement by which any Class

                                       J-4
<PAGE>

R Certificate is at any time subject to net tax by a foreign country or U.S.
possession), and the Owner will not hereafter engage in any such transfer or
assignment (or any such arrangement).]

      IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on
its behalf, pursuant to the authority of its Board of Directors, by its [Title
of Officer] and its corporate seal to be hereunto attached, attested by its
[Assistant] Secretary, this ____ day of _________, 20__.

                                        [Name of Owner]

                                        By: ____________________________________
                                             [Name of Officer]
                                             [Title of Officer]

[Corporate Seal]

ATTEST:

[Assistant] Secretary

                                       J-5
<PAGE>

      Personally appeared before me the above-named [Name of Officer], known or
proved to me to be the same person who executed the foregoing instrument and to
be the [Title of Officer] of the Owner, and Acknowledged to me that he executed
the same as his free act and deed and free act and deed of the Owner.

      Subscribed and sworn before me this ____ day of _________________, 20__.

                                        NOTARY PUBLIC

                                   COUNTY OF
                                   STATE OF
                                   My Commission expires the       day
                                   of                , 20

                                       J-6
<PAGE>

                                    EXHIBIT K

                     FORM OF ADDITIONAL MATTER INCORPORATED
                        INTO THE FORM OF THE CERTIFICATES

      This Certificate does not represent an obligation of or interest in ABN
AMRO Mortgage Corporation or any of its affiliates. Neither this Certificate nor
the underlying Loans are guaranteed by any agency or instrumentality of the
United States.

      This certifies that the above-mentioned Registered Owner is the registered
owner of certain interests in a trust fund (the "Certificate Trust Fund") whose
assets consist of, among other things, of a pool (the "Mortgage Pool") of
conventional one- to four-family mortgage loans (the "Loans"), formed by ABN
AMRO Mortgage Corporation (the "Depositor"). The Loans were originated or
acquired by various financial institutions and subsequently acquired by the
Depositor. The Mortgage Pool was created pursuant to a Pooling and Servicing
Agreement, dated as of the Cut-Off Date stated above (the "Pooling Agreement"),
between the Depositor, Washington Mutual Mortgage Securities Corp., as Servicer
(the "Servicer"), and U.S. Bank National Association, as Trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Pooling Agreement. Nothing herein shall
be deemed inconsistent with such meanings, and in the event of any conflict
between the Pooling Agreement and the terms of this Certificate, the Pooling
Agreement shall control. This Certificate is issued under and is subject to the
terms, provisions and conditions of the Pooling Agreement, to which Pooling
Agreement the Holder of this Certificate, by virtue of the acceptance hereof,
assents and by which such Holder is bound.

      Distributions will be made, pursuant to the Pooling Agreement, on the 25th
day of each month or, if such 25th day is not a Business Day, the Business Day
immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the applicable Record Date (as defined
in the Pooling and Servicing Agreement), to the extent of such
Certificateholder's Percentage Interest represented by this Certificate in the
portion of the Certificate Distribution Amount for such Distribution Date then
distributable on the Certificates of this Class, as specified in Section 4.1 of
the Pooling Agreement.

      Distributions on this Certificate will be made by the Trustee or its
Paying Agent by wire transfer or by other means of payment acceptable to each
Certificateholder of record on the immediately preceding Record Date.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee or its Paying Agent of the pendency of such
distribution and only upon presentation and surrender of this Certificate to the
Certificate Registrar.

      Reference is hereby made to the further provisions of this Certificate set
forth below, which further provisions shall for all purposes have the same
effect as if set forth at this place.

                                       K-1
<PAGE>

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

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

                                        U.S. BANK NATIONAL ASSOCIATION, as
                                        Trustee

                                        By: ____________________________________

                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

       This is one of the Certificates referred to in the within-mentioned
Pooling Agreement.

U.S. BANK NATIONAL ASSOCIATION, as Trustee

By: _________________________
Dated:

                                       K-2
<PAGE>

                          ABN AMRO MORTGAGE CORPORATION

                        MORTGAGE PASS-THROUGH CERTIFICATE

      This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series and Class
specified hereon (herein called the "Certificates") and representing certain
interests in the Certificate Trust Fund.

      The Certificates do not represent an obligation of, or an interest in, the
Depositor or any of its affiliates and are not insured or guaranteed by any
governmental agency. The Certificates are limited in right of payment to certain
collections and recoveries respecting the Loans, all as more specifically set
forth herein and in the Pooling Agreement. To the extent described in the
Pooling Agreement, the Servicer is obligated to advance its own funds to cover
certain shortfalls with respect to payments on the Loans. In the event Servicer
funds are advanced with respect to any Loan, such advance is reimbursable to the
Servicer from the related recoveries on such Loan or from other cash deposited
in the Custodial Account for P&I to the extent that such advance is not
otherwise recoverable.

      As provided in the Pooling Agreement, withdrawals from the Custodial
Account for P&I may be made by the Servicer from time to time for purposes other
than distributions to Certificateholders, such purposes including reimbursement
to the Servicer of advances made, or certain expenses incurred, by it.

      The Pooling Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor and the Servicer, and the rights of the Certificateholders under the
Pooling Agreement at any time by the Depositor and the Trustee, with the consent
of the Holders of the Certificates aggregating not less than 66-2/3% of the
aggregate Percentage Interest evidenced by each Class of Certificates affected
thereby. For the purposes of such provision and except as provided below, voting
rights related to 100% of the Aggregate Certificate Principal Balance of any
Class will be allocated pro rata (by Certificate Principal Balance) among the
Certificates of such Class. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Pooling Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.

      As provided in the Pooling Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar or the office maintained by
the Trustee in the City and State of New York, duly endorsed by, or accompanied
by an assignment in the form below or other written instrument of transfer in
form satisfactory to the Trustee or any Authenticating Agent duly executed by,
the Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new

                                       K-3
<PAGE>

Certificates of Authorized Denominations evidencing the same Percentage Interest
set forth hereinabove will be issued to the designated transferee or
transferees.

      No transfer of a Certificate will be made unless such transfer is exempt
from or is made in accordance with the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act") and any applicable
state securities laws. No transfer, sale, pledge or other disposition of a
Junior Subordinate Certificate shall be made unless such transfer, sale, pledge
or other disposition is made in accordance with Section 5.1(e) or Section 5.1(f)
of the Pooling Agreement. Each Person who, at any time, acquires any ownership
interest in any Junior Subordinate Certificate shall be deemed by the acceptance
or acquisition of such ownership interest to have agreed to be bound by the
provisions of such Section 5.1(e) and Section 5.1(f), as applicable. No transfer
of a Junior Subordinate Certificate shall be deemed to be made in accordance
with such Section 5.1(e) unless such transfer is made pursuant to an effective
registration statement under the Securities Act or unless the Trustee and the
Certificate Registrar are provided with the certificates and an Opinion of
Counsel, if required, on which the Trustee and the Certificate Registrar may
conclusively rely, which establishes or establish to the Trustee's and the
Certificate Registrar's satisfaction that such transfer is exempt from the
registration requirements under the Securities Act, as follows: In the event
that a transfer is to be made in reliance upon an exemption from the Securities
Act, the Trustee and the Certificate Registrar shall require, in order to assure
compliance with the Securities Act, that the Certificateholder desiring to
effect such transfer certify to the Trustee and the Certificate Registrar in
writing, in substantially the form attached as Exhibit F to the Pooling
Agreement, the facts surrounding the transfer, with such modifications to such
Exhibit F as may be appropriate to reflect the actual facts of the proposed
transfer, and that the Certificateholder's proposed transferee certify to the
Trustee and the Certificate Registrar in writing, in substantially the form
attached as Exhibit G to the Pooling Agreement, the facts surrounding the
transfer, with such modifications to such Exhibit G as may be appropriate to
reflect the actual facts of the proposed transfer. If such certificate of the
proposed transferee does not contain substantially the substance of Exhibit G,
the Trustee and the Certificate Registrar shall require an Opinion of Counsel
satisfactory to it that such transfer may be made without registration, which
Opinion of Counsel shall not be obtained at the expense of the Trustee, the
Certificate Registrar, the Trust Fund or the Depositor.

      Transfers of the Junior Subordinate Certificates may also be made in
accordance with Section 5.1(f) of the Pooling Agreement. To effectuate a
Certificate transfer in accordance with such Section 5.1(f), the proposed
transferee of such Certificate must provide the Trustee, the Certificate
Registrar and the Depositor with an investment letter substantially in the form
of Exhibit L attached to the Pooling Agreement, which investment letter shall
not be an expense of the Trustee, the Certificate Registrar or the Depositor,
and which investment letter states that, among other things, such transferee (i)
is a "qualified institutional buyer" as defined under Rule 144A, acting for its
own account or the accounts of other "qualified institutional buyers" as defined
under Rule 144A, and (ii) is aware that the proposed transferor intends to rely
on the exemption from registration requirements under the Securities Act
provided by Rule 144A. Notwithstanding the foregoing, the proposed transferee of
such Certificate shall not be required to provide the Trustee, the Certificate
Registrar or the Depositor with Annex 1 or Annex 2 to the form of such Exhibit

                                       K-4
<PAGE>

L if the Depositor so consents prior to each such transfer. Such transfers shall
be deemed to have complied with the requirements of Section 5.1(f) of the
Pooling Agreement. The Holder of a Certificate desiring to effect such transfer
does hereby agree to indemnify the Trustee, and the Certificate Registrar, the
Depositor, and the Certificate Registrar against any liability that may result
if transfer is not made in accordance with the Pooling Agreement.

      The Certificates are issuable only as registered Certificates without
coupons in Authorized Denominations specified in the Pooling Agreement. As
provided in the Pooling Agreement and subject to certain limitations therein set
forth, Certificates are exchangeable for new Certificates of Authorized
Denominations evidencing the same aggregate interest in the portion of the
Available Distribution Amount distributable on this Class of Certificate, as
requested by the Holder surrendering the same.

      A reasonable service charge may be made for any such registration of
transfer or exchange, and the Trustee or the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.

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

      The respective obligations and responsibilities of the Servicer and the
Trustee created under the Pooling Agreement (other than the obligation to make
payments to Certificateholders as set forth therein) shall terminate upon the
earlier of (i) the later of the final payment or other liquidation (or any
Advance with respect thereto) of the last Loan remaining in the Trust Fund and
the disposition of all property acquired in respect of any Loan or (ii) the
purchase by the Class R Certificateholders of all Loans at a price established
pursuant to the Pooling Agreement; provided, however, that in no event shall the
trust created hereby continue beyond 21 years from the death of the survivor of
certain persons identified in the Pooling Agreement.

                                       K-5
<PAGE>

                                   ASSIGNMENT

      FOR VALUE RECEIVED the undersigned hereby sell(s) and assign(s) and
transfer(s) unto

      (Please print or typewrite name and address, including postal zip code of
assignee. Please insert social security or other identifying number of
assignee.) _____________________________________________________________________
the within Mortgage Pass-Through Certificate and hereby irrevocably constitutes
and appoints _______________________________________ Attorney to transfer said
Certificate on the Certificate Register, with full power of substitution in the
premises.

Dated: ___________________              ________________________________________
                                        Signature Guaranteed

                                     NOTICE:

      The signature to this assignment must correspond with the name as written
upon the face of the within instrument in every particular, without alteration
or enlargement or any change whatever.

                                       K-6
<PAGE>

                                    EXHIBIT L

                   FORM OF RULE 144A INVESTMENT REPRESENTATION

             Description of Rule 144A Securities, including numbers:

____________________________
____________________________
____________________________

The undersigned seller, as registered holder (the "Seller"), intends to transfer
the Rule 144A Securities described above to the undersigned buyer (the "Buyer").

      1. In connection with such transfer and in accordance with the agreements
pursuant to which the Rule 144A Securities were issued, the Seller hereby
certifies the following facts: Neither the Seller nor anyone acting on its
behalf has offered, transferred, pledged, sold or otherwise disposed of the Rule
144A Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge or any
disposition of the Rule 144A Securities, any interest in the Rule 144A
Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security with, any person in any manner, or
made any general solicitation by means of general advertising or in any other
manner, or taken any other action, that would constitute a distribution of the
Rule 144A Securities under the Securities Act of 1933, as amended (the "1933
Act"), or that would render the disposition of the Rule 144A Securities in
violation of Section 5 of the 1933 Act or require registration pursuant thereto,
and that the Seller has not offered the Rule 144A Securities to any person other
than the Buyer or another "qualified institutional buyer" as defined in Rule
144A under the 1933 Act.

      2. The Buyer warrants and represents to, and covenants with, the Seller,
the Trustee, the Certificate Registrar and the Servicer (as defined in the
Pooling and Servicing Agreement (the "Agreement") dated as of December 1, 2003
between ABN AMRO Mortgage Corporation, as Depositor, Washington Mutual Mortgage
Securities Corp., as Servicer, and U.S. Bank National Association, as Trustee
pursuant to Section 5.1(f) of the Agreement, as follows:

      (a) The Buyer understands that the Rule 144A Securities have not been
registered under the 1933 Act or the securities laws of any state.

      (b) The Buyer considers itself a substantial, sophisticated institutional
investor having such knowledge and experience in financial and business matters
that it is capable of evaluating the merits and risks of investment in the Rule
144A Securities.

                                      L-1
<PAGE>

      (c) The Buyer has received and reviewed the Private Placement Memorandum
dated as of December 23, 2003 relating to the Rule 144A Securities and has been
furnished with all information regarding the Rule 144A Securities that it has
requested from the Seller, the Trustee, the Depositor or the Servicer.

      (d) Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A Securities,
any interest in the Rule 144A Securities or any other similar security to, or
solicited any offer to buy or accept a transfer, pledge or other disposition of
the Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security from, or otherwise approached or negotiated with respect to the
Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken
any other action, that would constitute a distribution of the Rule 144A
Securities under the 1933 Act or that would render the disposition of the Rule
144A Securities a violation of Section 5 of the 1933 Act or require registration
pursuant thereto, nor will it act, nor has it authorized or will it authorize
any person to act, in such manner with respect to the Rule 144A Securities.

      (e) The Buyer is a "qualified institutional buyer" as that term is defined
in Rule 144A under the 1933 Act and has (1) completed either of the forms of
certification to that effect attached hereto as Annex 1 or Annex 2, or (2)
obtained the waiver of the Depositor with respect to Annex 1 and Annex 2
pursuant to Section 5.1(f) of the Agreement. The Buyer is aware that the sale to
it is being made in reliance on Rule 144A. The Buyer is acquiring the Rule 144A
Securities for its own account or the accounts of other qualified institutional
buyers, understands that such Rule 144A Securities may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the 1933 Act.

      (f) The Buyer is not affiliated with (i) the Trustee or (ii) any Rating
Agency that rated the Rule 144A Securities.

      (g) If applicable, the Buyer has complied, and will continue to comply,
with the guidelines established by Thrift Bulletin 12 issued December 13, 1988,
by the Office of Regulatory Activities of the Federal Home Loan Bank System.

      [Required only in the case of a transfer of a Class B-3, Class B-4, or
Class B-5 Certificate]:[3. The Buyer warrants and represents to, and covenants
with, the Seller, the Servicer, the Certificate Registrar and the Depositor that
(1) the Buyer is not an employee benefit plan (within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")), subject to the prohibited transaction provisions of ERISA ("Plan"),
or a plan (within the meaning of Section 4975(e)(1) of the Internal Revenue Code
of 1986 ("Code")) subject to Section 4975 of the Code (also a "Plan"), and the

                                      L-2
<PAGE>

Buyer is not directly or indirectly purchasing the Rule 144A Securities on
behalf of, as investment manager of, as named fiduciary of, as trustee of, or
with "plan assets" of any Plan, or (2) the Buyer has provided the Seller, the
Servicer, the Certificate Registrar and the Depositor with an Officer's
Certificate signed by a Responsible Officer of the Buyer stating that the Buyer
is an insurance company using assets of an "insurance company general account"
(within the meaning of Department of Labor Prohibited Transaction Class
Exemption ("PTCE") 95-60) to effect such purchase and is eligible for, and
satisfies all of the requirements for exemptive relief under Sections I and III
of PTCE 95-60, which Officer's Certificate shall not be an expense of the
Servicer or the Depositor.]

      3. This document may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same document.

      IN WITNESS WHEREOF, each of the parties has executed this document as of
the date set forth below.

__________________________________          ____________________________________
        Print Name of Seller                        Print Name of Seller

By:_______________________________          By:_________________________________
      Name:                                       Name:
      Title:                                      Title:

Taxpayer Identification                     Taxpayer Identification
No.:                                        No.:
Date:                                       Date:

                                      L-3
<PAGE>

                                                            Annex 1 to Exhibit L

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

             [For Buyers Other Than Registered Investment Companies]

      The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:

      1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice-President or other executive officer of the Buyer.

      2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or invested on a
discretionary basis $________(1) in securities (except for the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year (such amount being calculated in accordance with Rule 144A) and (ii) the
Buyer satisfies the criteria in the category marked below.

      ____ Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts or similar
business trust, partnership, or charitable organization described in Section
501(c)(3) of the Internal Revenue Code.

      ____ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of Columbia,
the business of which is substantially confined to banking and is supervised by
the State or territorial banking commission or similar official or is a foreign
bank or equivalent institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial statements, a copy of
which is attached hereto.

      ____ Savings and Loan. The Buyer (a) is a savings and loan association,
building and loan association, cooperative bank, homestead association or
similar institution, which is supervised and examined by a State or Federal
authority having supervision over any such institutions or is a foreign savings
and loan association or equivalent institution and (b) has an audited net worth
of at least $25,000,000 as demonstrated in its latest annual financial
statements.

      ____ Broker-Dealer. The Buyer is a dealer registered pursuant to Section
15 of the Securities Exchange Act of 1934.

----------
(1) Buyer must own and/or invest on a discretionary basis at least $100,000,000
in securities unless Buyer is a dealer, and, in that case, Buyer must own and/or
invest on a discretionary basis at least $10,000,000 in securities.

                                      L-4
<PAGE>

      ____ Insurance Company. The Buyer is an insurance company whose primary
and predominant business activity is the writing of insurance or the reinsuring
of risks underwritten by insurance companies and which is subject to supervision
by the insurance commissioner or a similar official or agency of a State or
territory or the District of Columbia.

      ____ State or Local Plan. The Buyer is a plan established and maintained
by a State, its political subdivisions, or any agency or instrumentality of the
State or its political subdivisions, for the benefit of its employees.

      ____ ERISA Plan. The Buyer is an employee benefit plan within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA") and is subject to the fiduciary responsibility provisions of
ERISA.

      ____ Investment Adviser. The Buyer is an investment adviser registered
under the Investment Advisers Act of 1940.

      ____ SBIC. The Buyer is a Small Business Investment Company licensed by
the U.S. Small Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958.

      ____ Business Development Company. The Buyer is a business development
company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.

      ____ Trust Fund. The Buyer is a trust fund whose trustee is a bank or
trust company and whose participants are exclusively (a) plans established and
maintained by a State, its political subdivision, or any agency or
instrumentality of the State or its political subdivision, for the benefit of
its employees, or (b) employee benefit plans within the meaning of Title I of
the Employee Retirement Income Security Act of 1974, but is not a trust fund
that includes as participants individual retirement accounts or H.R. 10 plans.

      3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part of an
unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) bank deposit notes and certificates of deposit, (iv) loan participations,
(v) repurchase agreements, (vi) securities owned but subject to a repurchase
agreement and (vii) currency, interest rate and commodity swaps.

      4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the cost
of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not included if the Buyer
is a majority-owned, consolidated subsidiary of

                                      L-5
<PAGE>

another enterprise and the Buyer is not itself a reporting company under the
Securities Exchange Act of 1934.

      5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.

      [____] [____] Will the Buyer be purchasing the Rule 144A Securities
      Yes No only for the Buyer's own account?

      6. If the answer to the foregoing question is "no", the Buyer agrees that,
in connection with any purchase of securities sold to the Buyer for the account
of a third party (including any separate account) in reliance on Rule 144A, the
Buyer will only purchase for the account of a third party that at the time is a
"qualified institutional buyer" within the meaning of Rule 144A. In addition,
the Buyer agrees that the Buyer will not purchase securities for a third party
unless the Buyer has obtained a current representation letter from such third
party or taken other appropriate steps contemplated by Rule 144A to conclude
that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.

      7. The Buyer will notify each of the parties to which this certification
is made of any changes in the information and conclusions herein. Until such
notice is given, the Buyer's purchase of Rule 144A Securities will constitute a
reaffirmation of this certification as of the date of such purchase.

                                              Print Name of Buyer

                                              By:_______________________________
                                              Name:
                                              Title:
                                              Date:

                                      L-6
<PAGE>

                                                            Annex 2 to Exhibit L

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

[For Buyers That Are Registered Investment Companies]

      The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:

      1. As indicated below, the undersigned is the President, Chief Financial
Officer or Senior Vice-President of the Buyer or, if the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933 ("Rule 144A") because Buyer is a part of a Family of Investment
Companies (as defined below), is such an officer the Adviser.

      2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, and (ii)
as marked below, the Buyer alone, or the Buyer's Family of Investment Companies,
owned at least $100,000,000 in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year. For
purposes of determining the amount of securities owned by the Buyer or the
Buyer's Family of Investment Companies, the cost of such securities was used.

      ___ The Buyer owned $_______ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year (such amount being calculated in accordance with Rule 144A).

      ___ The Buyer is part of a Family of Investment Companies which owned in
the aggregate $_______ in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal year (such
amount being calculated in accordance with Rule 144A).

      3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser in a majority owned subsidiary of the other).

      4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyer's Family of
Investment Companies, (ii) bank deposit notes and certificates of deposit, (iii)
loan participations, (iv) repurchase agreements, (v) securities owned but
subject to a repurchase agreement and (vi) currency, interest rate and commodity
swaps.

                                      L-7
<PAGE>

      5. The Buyer is familiar with Rule 144A and understands that each of the
parties to which this certification is made are relying and will continue to
rely on the statements made herein because one or more sales to the Buyer will
be reliance on Rule 144A. In addition, the Buyer will only purchase for the
Buyer's own account.

      6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Buyer's purchase of Rule 144A Securities will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.

                                             Print Name of Buyer

                                             By:________________________________
                                             Name:
                                             Title:
                                             Date:

                                             IF AN ADVISER

                                             Print Name of Buyer

                                             By:________________________________
                                             Name:
                                             Title:
                                             Date:

(SEAL)

                                      L-8
<PAGE>

                                    EXHIBIT M

                        Scheduled Principal Balance Table

           Distribution Date                           Principal Balance
           Initial Balance..................            $354,678,057.75
           January 25, 2004.................             351,867,699.41
           February 25, 2004................             349,077,502.09
           March 25, 2004...................             346,307,324.78
           April 25, 2004...................             343,557,027.46
           May 25, 2004.....................             340,826,471.08
           June 25, 2004....................             338,115,517.56
           July 25, 2004....................             335,424,029.77
           August 25, 2004..................             332,751,871.53
           September 25, 2004...............             330,098,907.63
           October 25, 2004.................             327,465,003.78
           November 25, 2004................             324,850,026.61
           December 25, 2004................             322,253,843.70
           January 25, 2005.................             319,676,323.54
           February 25, 2005................             317,117,335.53
           March 25, 2005...................             314,576,749.99
           April 25, 2005...................             312,054,438.12
           May 25, 2005.....................             309,550,272.03
           June 25, 2005....................             307,064,124.73
           July 25, 2005....................             304,595,870.07
           August 25, 2005..................             302,145,382.82
           September 25, 2005...............             299,712,538.60
           October 25, 2005.................             297,297,213.90
           November 25, 2005................             294,899,286.06
           December 25, 2005................             292,518,633.27
           January 25, 2006.................             290,155,134.58
           February 25, 2006................             287,808,669.88
           March 25, 2006...................             285,479,119.88
           April 25, 2006...................             283,166,366.12
           May 25, 2006.....................             280,870,290.98
           June 25, 2006....................             278,590,777.64
           July 25, 2006....................             276,327,710.10
           August 25, 2006..................             274,080,973.17
           September 25, 2006...............             271,850,452.44
           October 25, 2006.................             269,636,034.31
           November 25, 2006................             267,437,605.98
           December 25, 2006................             265,255,055.42
           January 25, 2007.................             263,088,271.37
           February 25, 2007................             260,937,143.36
           March 25, 2007...................             258,801,561.68
           April 25, 2007...................             256,681,417.38
           May 25, 2007.....................             254,576,602.27
           June 25, 2007....................             252,487,008.92
           July 25, 2007....................             250,412,530.63
           August 25, 2007..................             248,353,061.45

                                      M-1
<PAGE>

           Distribution Date                           Principal Balance
           September 25, 2007...............             246,308,496.17
           October 25, 2007.................             244,278,730.31
           November 25, 2007................            $242,263,660.10
           December 25, 2007................             240,263,182.52
           January 25, 2008.................             238,277,195.23
           February 25, 2008................             236,305,596.65
           March 25, 2008...................             234,348,285.85
           April 25, 2008...................             232,405,162.64
           May 25, 2008.....................             230,476,127.51
           June 25, 2008....................             228,561,081.66
           July 25, 2008....................             226,659,926.95
           August 25, 2008..................             224,772,565.93
           September 25, 2008...............             222,898,901.86
           October 25, 2008.................             221,038,838.61
           November 25, 2008................             219,192,280.78
           December 25, 2008................             217,359,133.59
           January 25, 2009.................             215,539,302.95
           February 25, 2009................             213,732,695.39
           March 25, 2009...................             211,939,218.13
           April 25, 2009...................             210,158,779.00
           May 25, 2009.....................             208,391,286.48
           June 25, 2009....................             206,636,649.70
           July 25, 2009....................             204,894,778.41
           August 25, 2009..................             203,165,583.00
           September 25, 2009...............             201,448,974.45
           October 25, 2009.................             199,744,864.40
           November 25, 2009................             198,053,165.08
           December 25, 2009................             196,373,789.34
           January 25, 2010.................             194,706,650.62
           February 25, 2010................             193,051,662.99
           March 25, 2010...................             191,408,741.09
           April 25, 2010...................             189,777,800.16
           May 25, 2010.....................             188,158,756.05
           June 25, 2010....................             186,551,525.17
           July 25, 2010....................             184,956,024.52
           August 25, 2010..................             183,372,171.68
           September 25, 2010...............             181,799,884.80
           October 25, 2010.................             180,239,082.60
           November 25, 2010................             178,689,684.36
           December 25, 2010................             177,151,609.94
           January 25, 2011.................             175,624,779.73
           February 25, 2011................             174,109,114.69
           March 25, 2011...................             172,604,536.33
           April 25, 2011...................             171,110,966.70
           May 25, 2011.....................             169,628,328.39
           June 25, 2011....................             168,156,544.55
           July 25, 2011....................             166,695,538.84
           August 25, 2011..................             165,245,235.45
           September 25, 2011...............             163,805,559.11
           October 25, 2011.................             162,376,435.08

                                      M-2
<PAGE>

           Distribution Date                          Principal Balance
           November 25, 2011................             160,957,789.12
           December 25, 2011................             159,549,547.51
           January 25, 2012.................             158,151,637.07
           February 25, 2012................            $156,763,985.08
           March 25, 2012...................             155,386,519.38
           April 25, 2012...................             154,019,168.27
           May 25, 2012.....................             152,661,860.56
           June 25, 2012....................             151,314,525.58
           July 25, 2012....................             149,977,093.11
           August 25, 2012..................             148,649,493.45
           September 25, 2012...............             147,331,657.37
           October 25, 2012.................             146,023,516.14
           November 25, 2012................             144,725,001.47
           December 25, 2012................             143,436,045.60
           January 25, 2013.................             142,156,581.18
           February 25, 2013................             140,886,541.39
           March 25, 2013...................             139,625,859.82
           April 25, 2013...................             138,374,470.56
           May 25, 2013.....................             137,132,308.14
           June 25, 2013....................             135,899,307.56
           July 25, 2013....................             134,675,404.25
           August 25, 2013..................             133,460,534.11
           September 25, 2013...............             132,254,633.48
           October 25, 2013.................             131,057,639.14
           November 25, 2013................             129,869,488.32
           December 25, 2013................             128,690,118.66
           January 25, 2014.................             127,519,468.27
           February 25, 2014................             126,357,475.67
           March 25, 2014...................             125,204,079.81
           April 25, 2014...................             124,059,220.06
           May 25, 2014.....................             122,922,836.23
           June 25, 2014....................             121,794,868.53
           July 25, 2014....................             120,675,257.60
           August 25, 2014..................             119,563,944.48
           September 25, 2014...............             118,460,870.62
           October 25, 2014.................             117,365,977.91
           November 25, 2014................             116,279,208.59
           December 25, 2014................             115,200,505.36
           January 25, 2015.................             114,129,811.27
           February 25, 2015................             113,067,069.79
           March 25, 2015...................             112,012,224.78
           April 25, 2015...................             110,965,220.51
           May 25, 2015.....................             109,926,001.59
           June 25, 2015....................             108,894,513.07
           July 25, 2015....................             107,870,700.35
           August 25, 2015..................             106,854,509.21
           September 25, 2015...............             105,845,885.82
           October 25, 2015.................             104,844,776.73
           November 25, 2015................             103,851,128.84
           December 25, 2015................             102,864,889.45

                                      M-3
<PAGE>
           Distribution Date                           Principal Balance
           January 25, 2016.................             101,886,006.18
           February 25, 2016................             100,914,427.07
           March 25, 2016...................              99,950,100.49
           April 25, 2016...................              98,992,975.18
           May 25, 2016.....................             $98,043,000.22
           June 25, 2016....................              97,100,125.06
           July 25, 2016....................              96,164,299.51
           August 25, 2016..................              95,235,473.72
           September 25, 2016...............              94,313,598.17
           October 25, 2016.................              93,398,623.72
           November 25, 2016................              92,490,501.54
           December 25, 2016................              91,589,183.17
           January 25, 2017.................              90,694,620.45
           February 25, 2017................              89,806,765.60
           March 25, 2017...................              88,925,571.13
           April 25, 2017...................              88,050,989.92
           May 25, 2017.....................              87,182,975.15
           June 25, 2017....................              86,321,480.33
           July 25, 2017....................              85,466,459.31
           August 25, 2017..................              84,617,866.24
           September 25, 2017...............              83,775,655.61
           October 25, 2017.................              82,939,782.22
           November 25, 2017................              82,110,201.17
           December 25, 2017................              81,286,867.90
           January 25, 2018.................              80,469,738.14
           February 25, 2018................              79,658,767.94
           March 25, 2018...................              78,853,913.64
           April 25, 2018...................              78,055,131.90
           May 25, 2018.....................              77,262,379.68
           June 25, 2018....................              76,475,614.24
           July 25, 2018....................              75,694,793.13
           August 25, 2018..................              74,919,874.21
           September 25, 2018...............              74,150,815.62
           October 25, 2018.................              73,387,575.79
           November 25, 2018................              72,630,113.46
           December 25, 2018................              71,878,387.64
           January 25, 2019.................              71,132,357.63
           February 25, 2019................              70,391,983.01
           March 25, 2019...................              69,657,223.64
           April 25, 2019...................              68,928,039.69
           May 25, 2019.....................              68,204,391.56
           June 25, 2019....................              67,486,239.97
           July 25, 2019....................              66,773,545.87
           August 25, 2019..................              66,066,270.53
           September 25, 2019...............              65,364,375.44
           October 25, 2019.................              64,667,822.41
           November 25, 2019................              63,976,573.49
           December 25, 2019................              63,290,590.97
           January 25, 2020.................              62,609,837.46
           February 25, 2020................              61,934,275.78

                                      M-4
<PAGE>

           Distribution Date                           Principal Balance
           March 25, 2020...................              61,263,869.03
           April 25, 2020...................              60,598,580.58
           May 25, 2020.....................              59,938,374.03
           June 25, 2020....................              59,283,213.25
           July 25, 2020....................              58,633,062.36
           August 25, 2020..................             $57,987,885.72
           September 25, 2020...............              57,347,647.96
           October 25, 2020.................              56,712,313.93
           November 25, 2020................              56,081,848.75
           December 25, 2020................              55,456,217.77
           January 25, 2021.................              54,835,386.59
           February 25, 2021................              54,219,321.03
           March 25, 2021...................              53,607,987.17
           April 25, 2021...................              53,001,351.32
           May 25, 2021.....................              52,399,380.03
           June 25, 2021....................              51,802,040.07
           July 25, 2021....................              51,209,298.46
           August 25, 2021..................              50,621,122.43
           September 25, 2021...............              50,037,479.45
           October 25, 2021.................              49,458,337.23
           November 25, 2021................              48,883,663.68
           December 25, 2021................              48,313,426.94
           January 25, 2022.................              47,747,595.39
           February 25, 2022................              47,186,137.62
           March 25, 2022...................              46,629,022.43
           April 25, 2022...................              46,076,218.85
           May 25, 2022.....................              45,527,696.12
           June 25, 2022....................              44,983,423.70
           July 25, 2022....................              44,443,371.26
           August 25, 2022..................              43,907,508.68
           September 25, 2022...............              43,375,806.06
           October 25, 2022.................              42,848,233.69
           November 25, 2022................              42,324,762.09
           December 25, 2022................              41,805,361.97
           January 25, 2023.................              41,290,004.25
           February 25, 2023................              40,778,660.06
           March 25, 2023...................              40,271,300.71
           April 25, 2023...................              39,767,897.73
           May 25, 2023.....................              39,268,422.85
           June 25, 2023....................              38,772,847.98
           July 25, 2023....................              38,281,145.25
           August 25, 2023..................              37,793,286.97
           September 25, 2023...............              37,309,245.64
           October 25, 2023.................              36,828,993.96
           November 25, 2023................              36,352,504.82
           December 25, 2023................              35,879,751.29
           January 25, 2024.................              35,410,706.66
           February 25, 2024................              34,945,344.35
           March 25, 2024...................              34,483,638.03
           April 25, 2024...................              34,025,561.50

                                      M-5
<PAGE>

           Distribution Date                             Principal Balance
           May 25, 2024.....................              33,571,088.77
           June 25, 2024....................              33,120,194.04
           July 25, 2024....................              32,672,851.67
           August 25, 2024..................              32,229,036.21
           September 25, 2024...............              31,788,722.38
           October 25, 2024.................              31,351,885.09
           November 25, 2024................             $30,918,499.41
           December 25, 2024................              30,488,540.59
           January 25, 2025.................              30,061,984.07
           February 25, 2025................              29,638,805.43
           March 25, 2025...................              29,218,980.44
           April 25, 2025...................              28,802,485.05
           May 25, 2025.....................              28,389,295.35
           June 25, 2025....................              27,979,387.62
           July 25, 2025....................              27,572,738.29
           August 25, 2025..................              27,169,323.98
           September 25, 2025...............              26,769,121.44
           October 25, 2025.................              26,372,107.61
           November 25, 2025................              25,978,259.57
           December 25, 2025................              25,587,554.58
           January 25, 2026.................              25,199,970.05
           February 25, 2026................              24,815,483.55
           March 25, 2026...................              24,434,072.80
           April 25, 2026...................              24,055,715.68
           May 25, 2026.....................              23,680,390.23
           June 25, 2026....................              23,308,074.64
           July 25, 2026....................              22,938,747.25
           August 25, 2026..................              22,572,386.55
           September 25, 2026...............              22,208,971.20
           October 25, 2026.................              21,848,479.98
           November 25, 2026................              21,490,891.83
           December 25, 2026................              21,136,185.85
           January 25, 2027.................              20,784,341.28
           February 25, 2027................              20,435,337.48
           March 25, 2027...................              20,089,154.00
           April 25, 2027...................              19,745,770.50
           May 25, 2027.....................              19,405,166.79
           June 25, 2027....................              19,067,322.82
           July 25, 2027....................              18,732,218.70
           August 25, 2027..................              18,399,834.64
           September 25, 2027...............              18,070,151.03
           October 25, 2027.................              17,743,148.37
           November 25, 2027................              17,418,807.31
           December 25, 2027................              17,097,108.63
           January 25, 2028.................              16,778,033.24
           February 25, 2028................              16,461,562.20
           March 25, 2028...................              16,147,676.68
           April 25, 2028...................              15,836,358.01
           May 25, 2028.....................              15,527,587.62
           June 25, 2028....................              15,221,347.10

                                      M-6
<PAGE>

           Distribution Date                            Principal Balance
           July 25, 2028....................              14,917,618.14
           August 25, 2028..................              14,616,382.58
           September 25, 2028...............              14,317,622.38
           October 25, 2028.................              14,021,319.63
           November 25, 2028................              13,727,456.53
           December 25, 2028................              13,436,015.43
           January 25, 2029.................              13,146,978.79
           February 25, 2029................             $12,860,329.18
           March 25, 2029...................              12,576,049.31
           April 25, 2029...................              12,294,122.02
           May 25, 2029.....................              12,014,530.25
           June 25, 2029....................              11,737,257.06
           July 25, 2029....................              11,462,285.65
           August 25, 2029..................              11,189,599.31
           September 25, 2029...............              10,919,181.47
           October 25, 2029.................              10,651,015.66
           November 25, 2029................              10,385,085.54
           December 25, 2029................              10,121,374.87
           January 25, 2030.................               9,859,867.54
           February 25, 2030................               9,600,547.54
           March 25, 2030...................               9,343,398.98
           April 25, 2030...................               9,088,406.07
           May 25, 2030.....................               8,835,553.14
           June 25, 2030....................               8,584,824.64
           July 25, 2030....................               8,336,205.11
           August 25, 2030..................               8,089,679.21
           September 25, 2030...............               7,845,231.70
           October 25, 2030.................               7,602,847.46
           November 25, 2030................               7,362,511.46
           December 25, 2030................               7,124,208.79
           January 25, 2031.................               6,887,924.62
           February 25, 2031................               6,653,644.27
           March 25, 2031...................               6,421,353.12
           April 25, 2031...................               6,191,036.66
           May 25, 2031.....................               5,962,680.50
           June 25, 2031....................               5,736,270.35
           July 25, 2031....................               5,511,791.99
           August 25, 2031..................               5,289,231.34
           September 25, 2031...............               5,068,574.39
           October 25, 2031.................               4,849,807.25
           November 25, 2031................               4,632,916.10
           December 25, 2031................               4,417,887.24
           January 25, 2032.................               4,204,707.06
           February 25, 2032................               3,993,362.05
           March 25, 2032...................               3,783,838.78
           April 25, 2032...................               3,576,123.94
           May 25, 2032.....................               3,370,204.29
           June 25, 2032....................               3,166,066.69
           July 25, 2032....................               2,963,698.09
           August 25, 2032..................               2,763,085.54

                                      M-7
<PAGE>

           Distribution Date                            Principal Balance
           September 25, 2032...............               2,564,216.19
           October 25, 2032.................               2,367,077.24
           November 25, 2032................               2,171,656.03
           December 25, 2032................               1,977,939.96
           January 25, 2033.................               1,785,916.52
           February 25, 2033................               1,595,573.30
           March 25, 2033...................               1,406,897.96
           April 25, 2033...................               1,219,878.27
           May 25, 2033.....................              $1,034,502.06
           June 25, 2033....................                 850,757.26
           July 25, 2033....................                 668,631.90
           August 25, 2033..................                 488,114.06
           September 25, 2033...............                 309,191.94
           October 25, 2033.................                 131,853.78
           November 25, 2033................              $        0.00

                                      M-8
<PAGE>

                                    EXHIBIT N

                                   [RESERVED]

                                      N-1
<PAGE>

                                    EXHIBIT O
                                   [Reserved]

                                       O-1
<PAGE>

                                    EXHIBIT P

                                   [RESERVED]

                                       P-1
<PAGE>

                                    EXHIBIT Q

                                 BLOOMBERG DATA

Loan Number
Property Type
Owner Occupied
Loan Purpose
Loan Type
Current Interest Rate
Original Balance
Current Balance
First Payment Date
Maturity Date
Current PNI
Servicing Fee
Loan Term
Foreclosure/REO
Loan to Value Ratio
State Code
Interest Paid to Date
Zip Code
PIF Data
Amortized Remaining Term

                                       Q-1
<PAGE>

                                    EXHIBIT R

                       FORM OF SPECIAL SERVICING AGREEMENT

      This SPECIAL SERVICING AGREEMENT (the "Agreement") is made and entered
into as of ____________ 1, 20__, between _______________, as seller and servicer
(the "Company"), _______________, as holder of the Class B Certificates
identified on Schedule I (the "Class B Holder") and _______________, [an
affiliate of the Class B Holder,] as special servicer (the "Special Servicer").

                              PRELIMINARY STATEMENT

      WHEREAS, the Class B Holder is the holder of at least 75% of each the
classes of Mortgage Pass-Through Certificates (each a "Class B Certificate") of
the series of issuances (each a "Series") issued by the Company identified on
Schedule I attached hereto (such Schedule I, as may be modified or amended to
reflect (i) the purchase from time to time by the Class B Holder of interests in
any class of Class B Certificates of a Series such that the Class B Holder owns
not less than 75% of the then outstanding Certificate Principal Balance of such
Class B Certificates and (ii) the sale from time to time of the Class B Holder
of interests in any class of Class B Certificates of a Series such that the
Class B Holder owns less than 75% of the then outstanding Certificate Principal
Balance of such Class B Certificates, the "Schedule I").

      WHEREAS, each of the Class B Certificates was issued by the Company
pursuant to the Pooling and Servicing Agreement or Agreements (each a "Pooling
and Servicing Agreement") identified on Schedule I and evidences an ownership
interest in a pool of Mortgage Loans.

      WHEREAS, the Company is the Servicer of the Mortgage Loans related to each
Series and the Mortgage Loans are serviced in accordance with the applicable
Pooling and Servicing Agreement [and the Company's [Servicer Guide] (the
"Servicer Guide")].

      WHEREAS, in connection with the purchase by Class B Holder of a Series of
Class B Certificates (whether owned by the Class B Holder on the date hereof or
purchased by the Class B Holder at any time in the future), the Class B Holder
and the Company have agreed that (i) the Class B Holder, if it owns 75% of the
most subordinate outstanding class of Class B Certificates of a Series
(calculated by dividing the then outstanding Certificate Principal Balance of
such Class B Certificates by the then outstanding Certificate Principal Balance
of all certificates of the same class) may elect to have certain Mortgage Loans
with respect to the related Series that become 90 or more days delinquent (each
such Mortgage Loan, a "Delinquent Mortgage Loan") serviced by the Special
Servicer (each such Delinquent Mortgage Loan, a "Specially Serviced Mortgage
Loan"), and (ii) with respect to Delinquent Mortgage Loans other than Specially
Serviced Mortgage Loans, the Company will provide to the Class B Holder such
information as is generated [pursuant to the terms of the Servicer Guide] by the
Company or a subservicer with respect to such Delinquent Loan.

                                      R-1
<PAGE>

      NOW THEREFORE, in consideration of the premises and mutual agreements
hereinafter set forth, the Company, the Class B Holder and the Special Servicer
hereby agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

      Section 1.01 Definitions Incorporated by Reference.

      Capitalized terms used but not otherwise defined in this Agreement shall
have the respective meaning ascribed thereto as set forth in the related Pooling
and Servicing Agreement [or the Servicer Guide, as the context may require].

                                   ARTICLE II

          DESIGNATION OF SPECIALLY SERVICED MORTGAGE LOANS AND SPECIAL

                              SERVICING PROCEDURES

      Section 2.01 [Approval of _______________ as an Approved Servicer under
the Servicer Guide.

      The Company hereby approves _______________ as an approved servicer for
all purposes under the terms of the Servicer Guide.]

      Section 2.02 Specially Serviced Mortgage Loans.

      To the extent and for so long as the Class B Certificates of a Series are
outstanding and the Class B Holder owns at least 75% of the most subordinate
outstanding class of the Class B Certificates of such Series (calculated by
dividing the then outstanding Certificate Principal Balance of such Class B
Certificates by the then outstanding Certificate Principal Balance of all
certificates of the same class), Delinquent Mortgage Loans of the related Series
may, at the option of the Class B Holder, be designated in writing by the Class
B Holder as Specially Serviced Mortgage Loans and transferred to the Special
Servicer for servicing. The Special Servicer shall service the Specially
Serviced Mortgage Loans in accordance with the terms of the related Pooling and
Servicing Agreement [and the Servicer Guide].

      Following the designation of a Delinquent Mortgage Loan as a Specially
Serviced Loan, the Company shall transfer servicing of such Delinquent Mortgage
Loan to the Special Servicer substantially in the manner set forth herein and in
Schedule II hereto. [The parties hereto agree that any fees resulting from the
transfer of the servicing of a Delinquent Mortgage Loan from the Company or a
subservicer to the Special Servicer (or any successor thereto) shall be the
obligation of the Company.]

                                      R-2
<PAGE>

      As of the Effective Date (as defined below) of each Specially Serviced
Mortgage Loan, the Special Servicer shall succeed to and undertake all rights,
duties and obligations of the prior servicer (including, without limitation, the
making of advances, any right to purchase such Specially Serviced Mortgage Loan
at the purchase price set forth in the related Pooling and Servicing Agreement
and the right to receive the servicing fee with respect to such Specially
Serviced Mortgage Loan) pursuant to and in accordance with the terms of the
related Pooling and Servicing Agreement [and the terms and conditions of the
Servicer Guide].

      With respect to each Specially Serviced Mortgage Loan, the effective date
(the "Effective Date") shall be the first day of the month immediately following
the month of designation of such Specially Serviced Mortgage Loan as such,
provided that such written designation is received by the Company on or prior to
the 15th calendar day of such month.

      Once a Delinquent Mortgage Loan becomes a Specially Serviced Mortgage
Loan, such Delinquent Mortgage Loan shall remain a Specially Serviced Mortgage
Loan, and shall continue to be serviced by the Special Servicer, until the
earlier of the liquidation or other disposition of such Specially Serviced
Mortgage Loan or the termination of this Agreement, regardless of delinquency
status, whether the related Mortgaged Property becomes an REO Property or
otherwise; provided, however, that if the Company exercises its right as
Servicer to purchase all of the Mortgage Loans in a Trust Fund pursuant to an
optional termination provision under the related Pooling and Servicing
Agreement, the servicing of any related Specially Serviced Mortgage Loans with
respect to which foreclosure proceedings have not been commenced shall be
transferred promptly by the Special Servicer in accordance with written
instructions from the Company.

      If the Class B Holder (i) transfers such percentage interest in any Class
B Certificates of a Series such that the Class B Holder owns less than 75% of
the then outstanding Certificate Principal Balance of such class, or (ii)
purchases such percentage interest in any Class B Certificates of a Series such
that the Class B Holder owns 75% or more of the then outstanding Certificate
Principal Balance of such class, the Class B Holder shall promptly notify the
Company and the Special Servicer in writing of any such transfer or acquisition.
Upon receipt of written notice from the Class B Holder, the Company or the Class
B Holder shall revise Schedule I hereto to reflect any such transfer or
acquisition and shall forward promptly a copy of such revised schedule to the
Company or the Class B Holder, as applicable, and the Special Servicer. With
respect to the purchase of at least 75% of the Class B Certificates of any
Series by the Class B Holder after the date hereof, this Agreement shall be
effective as of the date such written notice of acquisition is received by the
Company.

      If and to the extent the Company is permitted to purchase Delinquent
Mortgage Loans under the related Pooling and Servicing Agreement, the Class B
Holder may direct the Company to purchase any Specially Serviced Mortgage Loan
and to promptly resell such Mortgage Loan to the Class B Holder at the price and
on the terms set forth in such Pooling and Servicing Agreement. In the event the
Class B Holder directs the Company to purchase a Specially Serviced Mortgage
Loan as permitted under this Section, the Company shall promptly take all action
necessary under the terms of the related Pooling and

                                      R-3
<PAGE>

Servicing Agreement in order to accomplish such purchase (i.e. provide
notification to the Trustee and/or Custodian) and to resell such Specially
Serviced Mortgage Loan to the Class B Holder. The Class B Holder, and not the
Company, shall be required to remit the purchase price for such Specially
Serviced Mortgage Loan to the related Trustee. The Company will inform the
Trustee in writing of the purchase of such Specially Serviced Mortgage Loan by
the Class B Holder and further shall promptly take all actions necessary or
desirable to effect the conveyance of such Mortgage Loan and the related
servicing rights to the Class B Holder or its designee, time being of the
essence.

      Notwithstanding any provision herein to the contrary, the Special Servicer
shall (i) in no event be obligated to effect any cure or remedy in connection
with a deficiency in the documentation for any Specially Serviced Mortgage Loan
to the extent such deficiency existed at the time such Mortgage Loan became a
Specially Serviced Mortgage Loan or (ii) have any responsibility for any
obligations, duties, or liabilities of the Company with respect to the servicing
of a Specially Serviced Mortgage Loan that arose prior to the related Effective
Date for such Specially Serviced Mortgage Loan, other than those which would
customarily be assumed after the Effective Date.

      Section 2.03 Termination of Special Servicer for Default.

      The Company shall have the right, immediately upon written notice, to
terminate the Special Servicer's right and obligation to subservice all of the
Specially Serviced Mortgage Loans hereunder in the event (each such event, an
"Event of Default") of:

      (i) any failure by the Special Servicer to remit to the Company for
distribution to the Certificateholders of a Series any payment (including
without limitation, any failure to make any required Advance) required to be
made under the terms of this Agreement or the related Pooling and Servicing
Agreement which continues unremedied for a period of one day after the date upon
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Special Servicer by the Company; or

      (ii) any failure on the part of the Special Servicer duly to observe or
perform in any material respect any other of the covenants or agreements on the
part of the Special Sub-Servicer contained in this Agreement (including any
breach of the Special Servicer's representations and warranties contained in
Section 4.03 hereof, which materially and adversely affects the interests of the
Certificateholders of a Series) which continues unremedied for a period of 30
days after the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Special Servicer by the Company; or

      (iii) a decree or order of a court or agency or supervisory authority
having jurisdiction in an involuntary case under any present or future federal
or state bankruptcy, insolvency or similar law or the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have

                                      R-4
<PAGE>

been entered against the Special Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of 60 consecutive days;
or

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

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

      If an Event of Default shall occur, then, and in each and every such case,
upon receipt of written notice from the Company, the Special Servicer shall
immediately remit to the Company all amounts in the Collection Accounts and the
Escrow Accounts and all rights of the Special Servicer to service the Specially
Serviced Mortgage Loans shall terminate. Following the receipt of written notice
from the Company as provided above, all authority and power of the Special
Sub-Servicer to subservice all the Specially Serviced Mortgage Loans shall pass
to and be vested in the Company pursuant to and under this Section 2.03, and the
Special Servicer shall do all things necessary to effect a transfer of the
servicing rights back to the Company. In this regard, the Company is hereby
authorized and empowered to execute and deliver, on behalf of the Special
Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the affected Specially
Serviced Mortgage Loans and related documents, or otherwise. The Special
Servicer agrees to cooperate with the Company in implementing the termination of
the Special Servicer's responsibilities and rights hereunder, including, without
limitation, the transfer to the Company or its appointed agent for
administration by it of all amounts in the possession of the Special Servicer or
thereafter be received with respect to the Specially Serviced Mortgage Loans and
the transfer of the] servicing rights back to the Company.

      Section 2.04 Appointment of Successor Special Servicer.

      The Class B Holder shall have the right, upon 90 days prior written notice
to the Company and the Special Servicer appoint a successor special servicer
having the characteristics set forth in clauses (i), (ii) and (iii) below, and
which shall succeed to all rights and assume all of the responsibilities, duties
and liabilities of the Special Servicer under this Agreement simultaneously with
the termination of the Special Servicer's responsibilities, duties and
liabilities under this Agreement. In the event that the Special Servicer's
duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to the foregoing, the Special Servicer shall discharge such
duties and responsibilities during the period from the date it acquires
knowledge of such termination until the effective date thereof with the same
degree of diligence and prudence which it is obligated to exercise under this
Agreement, and shall take no action

                                      R-5
<PAGE>

whatsoever that might impair or prejudice the rights or financial condition of
its successor. The removal of the Special Servicer shall not become effective
until a successor shall be appointed pursuant to this Section and shall in no
event relieve the Special Servicer of the representations and warranties made
pursuant to Section 4.03 and the remedies available to the Class B Holder and/or
the Company under Sections 4.04 and 5.01, it being understood and agreed that
the provisions of such Sections 4.04 and 5.01 shall be applicable to the Special
Servicer notwithstanding any such termination of it, or the termination of this
Agreement.

      Any successor special servicer shall (i) [be an institution having a net
worth of not less than $1,000,000][meet the eligibility requirements of an
approved servicer under the Company's Servicer Guide], (ii) the appointment of
such successor servicer will not result in the downgrading in any rating by any
applicable rating agency of any security issued in connection with the
applicable Pooling and Servicing Agreements, and (iii) have and keep in full
effect its existence, rights and franchises as a corporation (or such other
corporate form), and shall obtain its qualification to do business as a foreign
corporation (or such other corporate form) in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement or any of the Specially Serviced Mortgage Loans
and to perform its duties under this Agreement. Any successor appointed as
provided herein shall execute, acknowledge and deliver to the Class B Holder and
the Company an instrument accepting such appointment, wherein the successor
shall make the representations and warranties set forth in Section 4.03,
whereupon such successor shall become fully vested with all the rights, powers,
duties, responsibilities, obligations and liabilities of the Special Servicer,
with like effect as if originally named as a party to this Agreement.

      Within 30 days of the appointment of a successor special servicer by the
Class B Holder, the Special Servicer shall prepare, execute and deliver to the
successor entity any and all documents and other instruments, place in such
successor's possession all servicing files related to the Specially Serviced
Mortgage Loans, and do or cause to be done all other acts or things necessary or
appropriate to effect the purposes of such notice of termination [, including
but not limited to the transfer and endorsement of the related Mortgage Notes
and other documents, and the Class B Holder shall do or cause to be done the
preparation and recordation of Assignments of Mortgage and Deeds at the Class B
Holder's sole expense].

      The Special Servicer shall cooperate with the Class B Holder and such
successor in effecting the termination of the Special Servicer's
responsibilities and rights hereunder and the transfer of servicing
responsibilities to the successor special servicer, including without
limitation, the transfer to such successor of all amounts received by it with
respect to the Specially Serviced Mortgage Loans. Further, the Special Servicer
shall execute and deliver such instruments and do such other things as may
reasonably be required to more fully and definitively vest in the successor all
such rights, powers, duties, responsibilities, obligations and liabilities of
the Special Servicer.

                                   ARTICLE III

                                      R-6
<PAGE>

             DELINQUENT MORTGAGE LOANS OTHER THAN SPECIALLY SERVICED

                                 MORTGAGE LOANS

      Section 3.01 Reporting of Delinquent Mortgage Loans.

      (a) To the extent and for so long as the Class B Certificates of a Series
are outstanding and any interest in such Class B Certificates is held by the
Class B Holder, the Company, as Servicer of the Mortgage Loans related to each
Series, hereby agrees to provide to the Class B Holder the following notices and
reports:

      Within three (3) Business Days after each Distribution Date (or included
in or with the monthly statements to Certificateholders pursuant to the related
Pooling and Servicing Agreement), the Company shall provide to the Class B
Holder a report, in tape format, containing the following information:

      (1) With respect to each Series, the number and aggregate Principal
Balance of the Mortgage Loans delinquent one, two and three months or more,
together with the Principal Balance of each Mortgage Loan delinquent, one, two
and three months or more;

      (2) With respect to each Series, the (i) number and aggregate Principal
Balance of Mortgage Loans with respect to which foreclosure proceedings have
been initiated, and (ii) the number and aggregate book value of Mortgaged
Properties acquired through foreclosure, deed in lieu of foreclosure or other
exercise of rights respecting the Trustee's security interest in the Mortgage
Loans, and with respect to each Mortgage Loan, the (i) Principal Balance of each
such Mortgage Loan with respect to which foreclosure proceedings have been
initiated, and (ii) the book value of each Mortgaged Property acquired through
foreclosure, deed in lieu of foreclosure or other exercise of rights respecting
the Trustee's security interest in the related Mortgage Loan; and

      (3) With respect to each Series, the amount of Realized Losses allocable
to the Certificates on the related Distribution Date and the cumulative amount
of Realized Losses allocated to such Certificates since the Cut-off Date, and
with respect to each Mortgage Loan, the amount of Realized Losses attributable
to such Mortgage Loan on the related Distribution Date and the cumulative amount
of Realized Losses attributable to such Mortgage Loan since the Cut-off Date.

      In addition, the Company, as Servicer of the Mortgage Loans, shall send,
or shall cause the related servicer to send, to the Class B Holder all other
written reports, documentation, instruments, certificates and correspondences
provided by a servicer under the terms of the Servicer Guide with respect to any
Mortgage Loan that becomes sixty (60) days or more delinquent.

      (b) If requested by the Class B Holder, the Company shall make its
servicing personnel available to respond to reasonable inquiries, by phone or in
writing by facsimile, electronic, or overnight

                                      R-7
<PAGE>

mail transmission, in connection with any Mortgage Loan identified in any report
or document provided pursuant to clause (a) above; provided, that the Company
shall only be required to provide information that is reasonably accessible to
its servicing personnel (or its subservicers).

      (c) In addition to the information described above, the Company shall
provide to the Class B Holder such information as the Class B Holder may
reasonably request; provided, however, that the Mortgage Loans are Delinquent
Mortgage Loans or the Mortgaged Property has been foreclosed upon. The Class B
Holder will reimburse the Company for any reasonable out-of-pocket expenses
incurred by it in providing such information.

      Section 3.02 Servicing of Delinquent Mortgage Loans.

      (a) Prior to the Commencement of Foreclosure of any Mortgage Loan, the
Company shall provide, or cause the related servicer to provide, the Class B
Holder with a notice (sent by telecopier) of such proposed and imminent
foreclosure, stating the loan number and the aggregate amount due under the
Mortgage Note.

      For purposes of this Agreement, "Commencement of Foreclosure" shall mean
the first official action required under local law in order to commence
foreclosure proceedings or to schedule a trustee's sale under a deed of trust,
including (i) in the case of a mortgage, any filing or service of process
necessary to commence an action to foreclosure, or (ii) in the case of a deed of
trust, posting, the publishing, filing or delivery of a notice of sale, but not
including in either case (x) any notice of default, notice of intent to
foreclose or sell or any other action prerequisite to the actions specified in
(i) or (ii) above, (y) the acceptance of a deed-in-lieu of foreclosure (whether
in connection with a sale of the related property or otherwise) or (z)
initiation and completion of a short pay-off.

      (b) In connection with any Delinquent Mortgage Loan with respect to which
a notice under clause (a) above has been delivered to the Class B Holder, the
Class B Holder shall provide the Company with written direction as to the action
to be taken with respect to such Delinquent Mortgage Loan, including, without
limitation, to proceed with foreclosure, to accept a deed-in-lieu of
foreclosure, to consent to a pre-foreclosure sale of Mortgaged Property at a
loss, or, if permitted under the terms of the related Pooling and Servicing
Agreement, to purchase Delinquent Mortgage Loans. Such written direction must be
received by the Company within two (2) Business Days of transmission of the
notice provided by the Company under clause (a) above. Such two (2) Business Day
period shall be extended for no longer than an additional three (3) Business
Days after the receipt of additional information requested if the Class B Holder
requests additional information related to such Delinquent Mortgage Loan;
provided, however that the Class B Holder will have at least one Business Day to
provide written direction after receipt of any requested additional information.
Any such additional information shall be provided only to the extent it is
obtainable by the Company from existing reports, certificates or statements or
otherwise be reasonably accessible to its servicing personnel (or subservicing
personnel). The Company shall as promptly as practicable carry out, or cause the
relevant servicer to carry out, the instruction of the Class B Holder in

                                      R-8
<PAGE>

the manner prescribed in such written direction. The Class B Holder agrees that
it has no right to negotiate directly with the Mortgagor during such period.

      In the event the Class B Holder fails to provide any written direction as
provided above, the Company may take any such action as would be consistent with
customary servicing practices of prudent mortgage loan servicers and the
Company's normal policies and practice.

      (c) With respect to any Delinquent Mortgage Loan for which the Company has
not provided a notice as contemplated in clause (a) above, the Class B Holder
may, at any time, provide the Company with written direction as to the action to
be taken with respect to such Delinquent Mortgage Loan, including, without
limitation, to commence foreclosure proceedings, to accept a deed-in-lieu of
foreclosure, to consent to a sale of Mortgaged Property at a loss, or, if
permitted under the terms of the related Pooling and Servicing Agreement, to
purchase Delinquent Mortgage Loans. To the extent such action is not
inconsistent with the terms of the related Pooling and Servicing Agreement or
the Company's duties thereunder as servicer, the Company shall as promptly as
practicable carry out, or cause the relevant servicer to carry out, the
instruction of the Class B Holder in the manner prescribed in such written
direction.

      (d) Any foreclosure of a Delinquent Mortgage Loan that has been initiated
in accordance with clauses (b) or (c) above may be discontinued if (i) the
Mortgage Loan has been brought current or if a refinancing or prepayment occurs
with respect to the Mortgage Loan (including by means of a short payoff approved
by the Class B Holder), (ii) the Company has agreed to the terms of a
forbearance agreement with the Mortgagor and such forbearance agreement has been
approved by the Class B Holder, or (iii) if and to the extent permitted under
the related Pooling and Servicing Agreement, Class B Holder directs the Company
to purchase such Delinquent Mortgage Loan at the price and on the terms set
forth in the related Pooling and Servicing Agreement.

      (e) In the event the Class B Holder directs the Company to purchase a
Delinquent Mortgage Loan as permitted under Sections 2.02 and 3.02 (b), (c) and
(d), the Class B Holder may direct the Company to purchase any Delinquent
Mortgage Loan and to promptly resell such Mortgage Loan to the Class B Holder at
the price and on the terms set forth in the applicable Pooling and Servicing
Agreement. In the event the Class B Holder directs the Company to purchase a
Delinquent Mortgage Loan as permitted under this Section, the Company shall
promptly take all action necessary under the terms of the related Pooling and
Servicing Agreement in order to accomplish such purchase (i.e. provide
notification to the Trustee and/or Custodian) and to resell such Delinquent
Mortgage Loan to the Class B Holder. The Class B Holder, and not the Company,
shall be required to remit the purchase price for such Delinquent Mortgage Loan
to the related Trustee. The Company will inform the Trustee in writing of the
purchase of such Delinquent Mortgage Loan by the Class B Holder and further
shall promptly take all actions necessary or desirable to effect the conveyance
of such Mortgage Loan and the related servicing rights to the Class B Holder or
its designee, time being of the essence. [The parties hereto agree that, in
connection with a purchase of a Delinquent Mortgage Loan as provided above, any
fees resulting from the transfer of the

                                      R-9
<PAGE>

servicing of such purchased Delinquent Mortgage Loan from the Company or a
subservicer to a servicer designated by the Class B Holder shall be the
obligation of the Company.]

      Section 3.03 Review of the Company's Procedures.

      The Company and the Class B Holder hereby agree that the Class B Holder
shall have the right, at its own expense and during normal business hours, to
review any and all of the books, records, or other information of the Company
which may be relevant to the Company's direct collection, loss mitigation
foreclosure and REO management procedures currently in place in order to confirm
that the procedures used by the Company and its subservicers are in accordance
with the customary servicing practices of prudent mortgage loan servicers. In
order to discuss such books, records or other information, the Company shall
make personnel available who are knowledgeable about such matters.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

      Section 4.01 Organizational and Other Related Warranties of the Class B
Holder. The Class B Holder hereby makes the following representations and
warranties to the Company and the Special Servicer:

      (i) Organization and Good Standing. The Class B Holder is an entity duly
organized, validly existing, and in good standing under the laws of its state of
incorporation or formation or the laws of the United States.

      (ii) No Violation. Neither the execution and delivery by the Class B
Holder of this Agreement, nor the consummation by the Class B Holder of the
transactions contemplated hereby, nor the performance of and compliance by the
Class B Holder with the provisions of this Agreement, will conflict with or
result in a breach or violation of, or constitute a default (or an event which,
with notice or the lapse of time, or both, would constitute a default) under,
the organizational documents (its articles of incorporation or charter or
by-laws) of the Class B Holder, or any of the provisions of any law, rule,
regulation, judgment, decree, demand, or order (of any federal, state, or local
governmental or regulatory authority or court) binding on the Class B Holder, or
any of its respective properties, or any of the provisions of any indenture,
mortgage, contract, instrument, or other document to which the Class B Holder is
a party or by which it is bound, or result in the creation or imposition of any
lien, charge, or encumbrance upon any of their respective properties pursuant to
the terms of any indenture, mortgage, contract, instrument, or other document.
The Class B Holder is not otherwise in violation of any law, rule, regulation,
judgment, decree, demand, or order (of any federal, state or local governmental
or regulatory authority or court), which violation, in the Class B Holder's,
good faith and reasonable judgment, is likely to affect materially and adversely
its ability to perform its obligations hereunder.

                                      R-10
<PAGE>

      (iii) Authorization and Enforceability. The execution and delivery by the
Class B Holder of this Agreement, the consummation of the transactions
contemplated hereby, and the performance and compliance by the Class B Holder
with the terms hereof are within the powers of the Class B Holder, and have been
duly authorized by all necessary action on the part of the Class B Holder. All
organizational resolutions and consents necessary for the Class B Holder to
enter into and consummate all transactions contemplated hereby have been
obtained. This Agreement has been duly executed and delivered by the Class B
Holder and constitutes the legal, valid and binding obligation of the Class B
Holder, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium, and other similar
laws affecting creditors' rights generally, and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in equity
or at law. The Class B Holder has not failed to obtain any consent, approval,
authorization, or order of, or failed to cause any registration or qualification
with, any court or regulatory authority or other governmental body having
jurisdiction over it, which consent, approval, authorization, order,
registration, or qualification is required for, and the absence of which would
materially adversely affect, the legal and valid execution, delivery, and
performance of this Agreement by the Class B Holder.

      (iv) No Litigation or Adverse Conditions. No litigation is pending or, to
the best of the Class B Holder's knowledge, threatened against it, which, if
determined adversely to the Class B Holder would prohibit the Class B Holder
from entering into this Agreement or, in the good faith and reasonable judgment
of the Class B Holder, is likely to materially and adversely affect either the
ability of the Class B Holder to perform its obligations hereunder.

      Section 4.02 Organizational and Other Related Warranties of the Company.
The Company hereby makes the following representations and warranties to the
Class B Holder and the Special Servicer:

      (i) Organization and Good Standing. The Company is an entity duly
organized, validly existing, and in good standing under the laws of its state of
incorporation or formation or the laws of the United States, and is in
compliance with the laws of each state in which any property is located to the
extent necessary to ensure the enforceability of each Mortgage Loan and to
perform its obligations hereunder and the Pooling and Servicing Agreement.

      (ii) No Violation. Neither the execution and delivery by Company of this
Agreement, nor the consummation by it of the transactions contemplated hereby,
nor the performance of and compliance by the Company with the provisions hereof
or of the Pooling and Servicing Agreement, will conflict with or result in a
breach or violation of, or constitute a default (or an event which, with notice
or the lapse of time, or both, would constitute a default) under, the
organizational documents (its articles of incorporation or charter or by-laws)
of the Company, or any of the provisions of any law, rule, regulation, judgment,
decree, demand, or order (of any federal, state, or local governmental or
regulatory authority or court) binding on the Company, or any of its properties,
or any of the provisions of any indenture, mortgage, contract, instrument, or
other document (including, without limitation, any Pooling and Servicing
Agreement) to which the Company is a party or by which it is bound, or result in
the creation or imposition of any lien, charge,

                                      R-11
<PAGE>

or encumbrance upon any of their respective properties pursuant to the terms of
any indenture, mortgage, contract, instrument, or other document. The Company is
not otherwise in violation of any law, rule, regulation, judgment, decree,
demand, or order (of any federal, state or local governmental or regulatory
authority or court), which violation, in the Company's good faith and reasonable
judgment, is likely to affect materially and adversely either its ability to
perform its obligations hereunder or under the Pooling and Servicing Agreements,
or the financial condition of the Company.

      (iii) Authorization and Enforceability. The execution and delivery by the
Company of this Agreement, the consummation of the transactions contemplated
hereby, and the performance and compliance by the Company with the terms hereof
and of the Pooling and Servicing Agreements are within the powers of the
Company, and have been duly authorized by all necessary action on the part of
the Company. All organizational resolutions and consents necessary for the
Company to enter into and consummate all transactions contemplated hereby have
been obtained. This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium, and other similar laws
affecting creditors' rights generally, and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in equity
or at law. The Company has not failed to obtain any consent, approval,
authorization, or order of, or failed to cause any registration or qualification
with, any court or regulatory authority or other governmental body having
jurisdiction over the Company, which consent, approval, authorization, order,
registration, or qualification is required for, and the absence of which would
materially adversely affect, the legal and valid execution, delivery, and
performance of this Agreement by the Company.

      (iv) Approvals and Permits. The Company possesses such certificates,
authorizations, licenses, and permits issued by the appropriate state, federal,
and foreign regulatory agencies or bodies necessary to conduct the business now
operated by it, and the Company has not received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization, or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling, or finding, would materially and adversely affect
the conduct of the business, operations, financial condition, or income of the
Company.

      (v) No Litigation or Adverse Conditions. No litigation is pending or, to
the best of the Company's knowledge, threatened against it, which, if determined
adversely to the Company would prohibit the Company from entering into this
Agreement or, in the good faith and reasonable judgment of the Company, is
likely to materially and adversely affect either its ability to perform its
obligations hereunder or under the Pooling and Servicing Agreements or the
financial condition of the Company. The Company has no knowledge of any recent
adverse financial condition or event with respect to itself that, in its good
faith and reasonable judgment, is likely to materially and adversely affect its
ability to perform its obligations hereunder or under the Pooling and Servicing
Agreements.

      (vi) Fidelity Bond: Errors and Omission Insurance. Each officer, director,
employee, consultant and advisor of the Company with responsibilities concerning
the servicing and administration of the

                                      R-12
<PAGE>

Mortgage Loans is covered by errors and omissions insurance and fidelity bond
insurance in the amounts and with the coverage required under the related
Pooling and Servicing Agreement for it to maintain. Neither the Company nor any
of its officers, directors, employees, consultants, or advisors involved in the
servicing or administration of the Mortgage Loans has been refused such coverage
or insurance.

      Section 4.03 Organizational and Other Related Warranties of the Special
Servicer. The Special Servicer hereby makes the following representations and
warranties to the Company and the Class B Holder:

      (i) Organization and Good Standing. The Special Servicer is an entity duly
organized, validly existing, and in good standing under the laws of its state of
incorporation or formation or the laws of the United States, and is in
compliance with the laws of each state in which any property is located to the
extent necessary to ensure the enforceability of each Mortgage Loan and to
perform its obligations hereunder.

      (ii) No Violation. Neither the execution and delivery by Special Servicer
of this Agreement, nor the consummation by it of the transactions contemplated
hereby, nor the performance of and compliance by the Special Servicer with the
provisions hereof , will conflict with or result in a breach or violation of, or
constitute a default (or an event which, with notice or the lapse of time, or
both, would constitute a default) under, the organizational documents (its
articles of incorporation or charter or by-laws) of the Special Servicer, or any
of the provisions of any law, rule, regulation, judgment, decree, demand, or
order (of any federal, state, or local governmental or regulatory authority or
court) binding on the Special Servicer, or any of its properties, or any of the
provisions of any indenture, mortgage, contract, instrument, or other document
to which the Special Servicer is a party or by which it is bound, or result in
the creation or imposition of any lien, charge, or encumbrance upon any of their
respective properties pursuant to the terms of any indenture, mortgage,
contract, instrument, or other document. The Special Servicer is not otherwise
in violation of any law, rule, regulation, judgment, decree, demand, or order
(of any federal, state or local governmental or regulatory authority or court),
which violation, in the Special Servicer's good faith and reasonable judgment,
is likely to affect materially and adversely either its ability to perform its
obligations hereunder, or the financial condition of the Special Servicer.

      (iii) Authorization and Enforceability. The execution and delivery by the
Special Servicer of this Agreement, the consummation of the transactions
contemplated hereby, and the performance and compliance by the Special Servicer
with the terms hereof are within the powers of the Special Servicer, and have
been duly authorized by all necessary action on the part of the Special
Servicer. All organizational resolutions and consents necessary for the Special
Servicer to enter into and consummate all transactions contemplated hereby have
been obtained. This Agreement has been duly executed and delivered by the
Special Servicer and constitutes the legal, valid and binding obligation of the
Special Servicer, enforceable against it in accordance with its terms, subject
to applicable bankruptcy, insolvency, reorganization, moratorium, and other
similar laws affecting creditors' rights generally, and to general principles of
equity, regardless of whether such enforcement is considered in a proceeding in
equity or at law. The Special Servicer has not failed to obtain any consent,
approval, authorization, or order of, or failed to cause any

                                      R-13
<PAGE>

registration or qualification with, any court or regulatory authority or other
governmental body having jurisdiction over the Special Servicer, which consent,
approval, authorization, order, registration, or qualification is required for,
and the absence of which would materially adversely affect, the legal and valid
execution, delivery, and performance of this Agreement by the Special Servicer.

      (iv) Approvals and Permits. The Special Servicer possesses such
certificates, authorizations, licenses, and permits issued by the appropriate
state, federal, and foreign regulatory agencies or bodies necessary to conduct
the business now operated by it, and its has not received any notice of
proceedings relating to the revocation or modification of any such certificate,
authorization, or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling, or finding, would materially and adversely affect
the conduct of the business, operations, financial condition, or income of the
Special Servicer.

      (v) No Litigation or Adverse Conditions. No litigation is pending or, to
the best of the Special Servicer's knowledge, threatened against it, which, if
determined adversely to the Special Servicer would prohibit the Special Servicer
from entering into this Agreement or, in the good faith and reasonable judgment
of the Special Servicer, is likely to materially and adversely affect either its
ability to perform its obligations hereunder or the financial condition of the
Special Servicer. The Special Servicer has no knowledge of any recent adverse
financial condition or event with respect to itself that, in its good faith and
reasonable judgment, is likely to materially and adversely affect its ability to
perform its obligations hereunder.

      (vi) Fidelity Bond, Errors and Omission Insurance. Each officer, director,
employee, consultant and advisor of the Special Servicer with responsibilities
concerning the servicing and administration of the Mortgage Loans is covered by
errors and omissions insurance and fidelity bond insurance in the amounts and
with the coverage required under the related Pooling and Servicing Agreement to
be maintained by the Company as servicer. Neither the Special Servicer nor any
of its officers, directors, employees, consultants, or advisors involved in the
servicing or administration of the Mortgage Loans has been refused such coverage
or insurance.

      (vii) Approved Seller/Servicer. The Special Servicer is approved as a
seller/servicer of single-family mortgage loans by the Department of Housing and
Urban Development.

      Section 4.04 Remedies for Breach of Representation and Warranty.

      Upon discovery by any of the Company, the Class B Holder or the Special
Servicer of a breach of any of the representations and warranties contained in
Article IV which materially and adversely affects the value of the Specially
Serviced Mortgage Loans or Delinquent Mortgage Loans, the party discovering such
breach shall give prompt written notice to the others.

      Each of the parties hereto shall indemnify the others and hold each of
them harmless against any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs,

                                      R-14
<PAGE>

judgments, and other costs and expenses resulting from any claim, demand,
defense or assertion based on or grounded upon, or resulting from, a breach of
such party's representations and warranties contained in Article IV. It is
understood and agreed that the obligations to indemnify as provided in this
Section 4.04 constitute the sole remedies of each of the Company, Class B Holder
and Special Servicer respecting a breach of any other party's representations
and warranties.

                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS

      Section 5.01 Indemnification.

      Each of the Company, the Class B Holder and the Special Servicer (each as
such, an "Indemnifying Party") shall indemnify the other parties hereto (each as
such, an "Indemnified Party") and hold them harmless against any and all claims,
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments, and any other costs, fees and expenses
(individually and collectively, the "Claims") that such Indemnified Party may
sustain in any way related to the failure of the Indemnifying Party to perform
its duties in compliance with the terms of this Agreement; provided, that none
of the Company, the Class B Holder or the Special Servicer or any of the
directors, officers, employees or agents of the Depositor or the Servicer shall
be liable for any action taken or for refraining from the taking of any action
in good faith pursuant to this Agreement, or for errors in judgment; provided,
however, that this provision shall not protect the Company, the Class B Holder
or the Special Servicer against any material breach of warranties,
representations or covenants made herein, or against any specific liability
imposed on such party pursuant hereto, or against any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder.

      Section 5.02 Amendment.

      This Agreement may be amended from time to time by written agreement
signed by each of the parties hereto.

      Section 5.03 Counterparts.

      This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original and
such counterparts shall constitute but one and the same instrument.

      Section 5.04 Governing Law.

                                      R-15
<PAGE>

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

      Section 5.05 Notices.

      All demands, notices and direction hereunder shall be in writing or by
telecopy and shall be deemed effective upon receipt to:

      (i)   in the case of the Company,

                                             Company

                                             Address:_________________________

                                             Attention:_______________________

                                             Telephone:_______________________

                                             Facsimile:_______________________

      or such other address as may hereafter be furnished to the Class B Holder
and the Special Servicer in writing.

      (ii)  in the case of the Class B Holder,

                                             Address:_________________________

                                             Attention:_______________________

                                             Telephone:_______________________

                                             Facsimile:_______________________

      or such other address as may hereafter be furnished to the Company in
writing.

      (iii) in the case of the Special Servicer,

                                             Address:_________________________

                                      R-16
<PAGE>

                                             Attention:_______________________

                                             Telephone:_______________________

                                             Facsimile:_______________________

      or such other address as may hereafter be furnished to the Company in
writing.

      Section 5.06 Termination.

      This Agreement shall terminate (i) at such time as the Principal Balance
of the Class B Certificates has been reduced to zero or (ii) if mutually agreed
to by the parties hereto.

      Section 5.07 Severability of Provisions.

      If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be held invalid for any reason whatsoever, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement. If the invalidity of any part, provision, representation or warranty
of this Agreement shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate in good faith to
develop a structure the economic effect of which is nearly as possible the same
as the economic effect of this Agreement without regard to such invalidity.

      Section 5.08 Successors and Assigns.

      This Agreement may not be assigned by any party hereto without the prior
written consent of each of the other parties hereto. The provisions of this
Agreement shall be binding upon and inure to the benefit of the respective
successors and assigns of the parties hereto.

      Section 5.09 Article and Section Headings.

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

      Section 5.10 Confidentiality.

      The Class B Holder agrees that all information supplied by or on behalf of
the Company pursuant to Sections 2.02 or 3.01, including individual account
information, is the property of the Company and the Class B Holder agrees to use
such information only for the purposes contemplated by this Agreement and

                                      R-17
<PAGE>

otherwise hold such information confidential and not to disclose such
information, except to the extent such information is made publicly available by
or on behalf of the Company or the relevant Trustee.

      Section 5.11 Publicly Registered Certificates.

      The Class B Holder agrees, that without the prior written consent of the
Company, so long as Class B Holder is a party to this Agreement and a holder of
any Class B Certificates of a Series, it will not purchase, sell or trade any
publicly registered Certificates of the same Series.

      Section 5.12 No Partnership.

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

      Section 5.13 Rights of the Class B Holder. Notwithstanding anything herein
to the contrary, it is agreed by the parties hereto that the rights of the Class
B Holder set forth under Article II and Section 3.02(e) of this Agreement shall
relate to, and be exercisable with respect to, the related Mortgage Loans of any
Series to the extent that and for so long as, the Class B Holder owns at least
75% of the most subordinate outstanding class of Class B Certificates of the
related Series (calculated by dividing the then outstanding Certificate
Principal Balance of such Class B Certificates by the then outstanding
Certificate Principal Balance of all certificates of the same class).

      IN WITNESS WHEREOF, each of the parties hereto have caused its name to be
signed hereto by its respective officer thereunto duly authorized, all as of the
day and year first above written.

      COMPANY

      By: _____________________________

      Name: ___________________________

      Title: __________________________

      By: _____________________________

      Name: ___________________________

      Title: __________________________

                                      R-18
<PAGE>

      By: _____________________________

      Name: ___________________________

      Title: ____________________________

                                      R-19
<PAGE>

                                                                      SCHEDULE I

Describe each Series of Class B Certificates and the related Pooling and
Servicing Agreement

                                      R-20
<PAGE>

                                                                     SCHEDULE II

                      SPECIAL SERVICING TRANSFER PROCEDURES

      Any transfer of servicing with respect to a Specially Serviced Mortgage
Loan shall be effected substantially in accordance with the following example.
All dates set forth below are for illustrative purposes only. Capitalized terms
used in this Exhibit shall have the meanings ascribed thereto in the Agreement.

      Timeline

      Last Business Day of Month One

      Mortgagor is 89 Days Delinquent.

      3rd Business Day of Month Two

      The Company receives an electronic file from its Collections Department on
all 90+delinquent loans.

      4th Business Day of Month Two

      The Company sends the electronic file to Class B Holder/Special Servicer
of all 90+ delinquent loans with information designating those loans where a
forbearance plan or workout is in progress and those loans where there is no
plan in place. The Company and the Special Servicer have a discussion. The loans
to be transferred are determined by the Class B Holder/Special Servicer.

      6th Business Day of Month Two

      The Special Servicer informs the Company of the loans designated as
Specially Serviced Mortgage Loans. The Company and the Special Servicer
coordinate the transfer of servicing of the Specially Serviced Mortgage Loans.
The Company prepares and mails the mortgagor notification no later than the 13th
calendar day of the month. If a loan reinstates to a current or less than 90
days delinquent status before the mortgagor notification (i.e., the "goodbye
letter") is sent, such loan will be removed from the transfer, and the Company
will notify the Special Servicer thereof. The borrower will be instructed to
send the payment due on the effective date of transfer and any past due payments
to the Special Servicer.

      7th Business Day of Month Two

                                      R-21
<PAGE>

      Relevant Trustee receives monthly electronic data file from the Company.
The subject loan is included in the Company's report as an active loan serviced
by the Company. The Company reports scheduled P&I on the subject loan.

      On or prior to 15th Calendar Day of Month Two

      The Company sends a foreclosure referral letter to the Special Servicer's
foreclosure counsel with a corresponding foreclosure package.

      18th Calendar Day (or Business day immediately preceding the 18th) of
Month Two

      The Company makes its monthly remittance, including advancing scheduled
P&I payment due for current month for the subject loan.

      Last business Day of Month Two

      Month-end cut-off.

      1st Business Day of Month Three

      Effective Date.

      On or Before 3rd Business Day of Month Three

      In accordance with the Servicing Transfer Instructions:

      Company sends Special Servicer final transfer data (e.g., trial balance,
loan files, current

      and previous 2 years' history records (if applicable), all default-related
correspondence, and all collection, foreclosure and bankruptcy files);

      Company provides Special Servicer with detailed reimbursement request
relating to advances; and

      Company sends Special Servicer a check or wire for the net escrow and
unapplied funds.

      On or before the 6th Business Day of Month Three

      In accordance with the Servicing Transfer Instructions, Special Service
reimburses Company for all outstanding advances, and the scheduled mortgage
payment due on the Effective Date.

      ______________________

                                      R-22
<PAGE>

      Note:

      1. If the loan has been transferred to Special Servicer and it cures,
Special Servicer continues to service the loan and report it to Company as
herein provided.

      2. If the Class B Certificates of the related Series are reduced to zero,
Special Servicer will continue to service the mortgage loans until they payoff
or are liquidated. No other Delinquent Mortgage Loans of a Series will be
transferred to Special Servicer after the Class B Certificates of such Series
are reduced to zero.

                                      R-23
<PAGE>

                         Servicing Transfer Instructions

      I. NOTIFICATION OF LOANS TO TRANSFER

      A. Company will coordinate and provide a listing of all loans past 90 days
delinquent. The list will be provided to Special Servicer for review and
discussion on the 4th Business day of each month.

      B. Class B Holder and Special Servicer to agree upon the loans to be
transferred at month-end. The list must be provided via Facsimile or E-mail by
the 6th business day of the month to:

      [COMPANY]

      [Address and contact]

      II. CONVERSION DATA

      Dependent upon the volume of loans transferring each month, the loans will
be transferred effective the first of each month based on the prior month-end
cut off by one of the following mutually agreed upon conversion methods.

      A. Manual conversion

      1. Company to provide a "master file data record" (COMPANY reference for
master file data record?) for each loan (accompanied by a listing of all code
definitions).

      2. Company to provide a trial balance containing all the loans.

      B. Electronic conversion

      1. Information will be provided in a Microsoft Excel spreadsheet (or such
other mutually agreeable format) containing mutually agreed upon fields.

      2. Company to provide a trial balance containing all the loans.

      Preliminary information for either a manual or electronic conversion will
be provided within 3 business days of receipt of the List of Loans to Transfer
to provide time for Special Servicer to verify and load the information, with
the exception of the specific data that is determined at the transfer date.

      III. HOMEOWNER NOTIFICATION

                                      R-24
<PAGE>

      A. Company will mail the mortgagor notification (good-bye letter) fifteen
days prior to the transfer date. Company will forward a copy of its good-bye
letter to Special Servicer c/o [Dept.] (fax number ___-___-____) for approval
prior to mailing.

      B. Copies of Company's mortgagor notification letters will be provided to
Special Servicer.

      C. Company to receive a sample of Special Servicer's mortgagor
notification (welcome letter) for approval prior to mailing.

      IV. HAZARD/FLOOD INSURANCE

      A. Company to prepare a change to the mortgagee clause as follows:

      Address:   _________________

      Attention: _________________

      Telephone: _________________

      Facsimile: _________________

      B. Copies of the mortgagee clause change requests will be provided to
Special Servicer.

      C. Any unpaid policies, expiration notices, cancellation notices, loans
with expired policies will be properly identified, sorted and marked for special
handling.

      D. Company to provide a list of loans under "force place coverage"
program. Force place hazard insurance policies with ASG will be canceled upon
transfer of the loans. WNC force place flood policy coverage will stay in place
after transfer until the expiration date.

      V. FHA LOANS

      A. Company to provide screen prints to include the following items on FHA
Loans with a monthly premium.

      1. Loan number

      2. FHA case number

      3. Anniversary date

                                      R-25
<PAGE>

      4. Annual premium

      5. Monthly amount

      6. Total MIP paid to date

      7. Next month the premium is due

      B. Company to provide screen prints to include the following items on FHA
loans that the full premium was paid up front.

      1. Loan number

      2. FHA case number

      3. Insuring date

      4. Amount of prepaid premium

      C. Company to prepare HUD Form 92080 with Special Servicer's HUD mortgagee
number (72313) and forward to HUD electronically. Proof of submission will be
forwarded to Special Servicer.

      VI. CONVENTIONAL LOANS

      A. Individual loan PMI certificates will be retained in the Servicing File

      B. Company to prepare notifications to the PMI companies requesting a
change of servicer to Special Servicer. Copies will be forwarded to Special
Servicer.

      C. Company to provide screen prints of all loans with PMI to include:

      1. Loan number

      2. PMI company

      3. PMI certificate number

      4. Next due date

      5. Last amount paid

                                      R-26
<PAGE>

      VII. REAL ESTATE TAXES

      A. Company to forward individual loan tax records showing payee, due
dates, frequency of payment, next due date, last paid date and last paid amount.

      B Company to provide copies of the notifications to the individual tax
authorities and the Tax Service requests for a change of servicer to Special
Servicer under the following contract numbers (Transamerica-2489 Pinnacle - 119)

      C. All property taxes due and payable will be paid prior to the transfer
date.

      D. All tax bills received after the transfer date will be forwarded to
Special Servicer for payment.

      E. Company to provide a listing of any loans with delinquent taxes
containing the pertinent information as of the transfer date.

      VIII. OPTIONAL INSURANCE

      A. Company to provide a list of loans with A&H, life insurance, accidental
death insurance, etc., which will include the following information.

      1. Loan number

      2. Insurance company

      3. Type of coverage

      4. Amount of monthly premium

      5. Last monthly premium paid

      B. Company to provide copies of the master and/or individual policies for
the insurance coverage.

      C. Company to provide copies of the notification sent to the insurance
companies.

                                      R-27
<PAGE>

      IX. INVESTOR REPORTS

      A. Company to provide a copy of the final remittance report to the
investor including a trial balance as of cutoff date.

      B. Company to provide ending loan scheduled balance at transfer date.

      C. Company to provide a report detailing advanced delinquent net interest
monthly by due date.

      D. Company to provide a report detailing advanced delinquent principal
monthly by due date.

      X. OTHER

      A. Company to provide hardcopies of the last 24 months history for each
loan accompanied by an explanation of transaction codes.

      B. Company to provide copies of the last escrow analysis for each loan
with an explanation of analysis method (cushion, etc.).

      C. Company to provide the loan servicing file in hardcopy or microfiche
format.

      D. Company to provide the currently active collection records and
pertinent information on delinquent loans.

      E. Net escrow and unapplied funds as of the transfer date will be sent to
Special Servicer via check or wire within three business days of the transfer,
accompanied by an explanation of

      Unapplied Funds codes.

      F. The advances (exclusive of escrow advances, which will be handled in
Section X (E) above) incurred by Company will be billed to Special Servicer
accompanied by appropriate documentation. Special Servicer to reimburse Company
via check or wire for all advances (exclusive of escrow advances, which will be
handled in Section X (E) above) on the subject loans within three business days
of receipt of billing.

      G. Company to provide a listing containing the mortgagor name,
co-mortgagor name, property address and mailing address for preparation of
Special Servicer's Notification Letters.

      H. Company to provide the following items, sorted and clearly marked for
special handling.

                                      R-28
<PAGE>

      1. Active foreclosure and bankruptcy files should have the status shown on
the front of each file.

      2. Insurance loss drafts should provide all documentation on the current
status.

      3. Unprocessed payoff funds should be accompanied by a copy of the payoff
quotation.

      4. Information should be furnished on any pending payoff or assumption.

      5. Information on any incomplete partial releases should be provided.

      I. Loan payments received after the cutoff will be endorsed to __________
and forwarded by overnight service to the following address within twenty-four
hours, properly identified with Company's loan number.

      [Address]

      Returned Items received after the transfer date will be forwarded to
Special Servicer for

      reimbursement. Special Servicer to reimburse Company within 10 business
days of receipt.

      J. Company to ship all loan files and documentation related to the
individual transfers by the 3rd business day after the cut-off. Any information,
such as preliminary trial balances, master file data records, delinquency
information, etc. will be furnished as early as possible prior to the transfer
date.

      All shipments to be sent to:

      [Address]

      K. Company to furnish all required IRS reporting statements for the
current year up to the transfer date, both to the mortgagors and to the
appropriate government agencies. Special Servicer to furnish all required
year-end reporting commencing on the effective date of transfer through the
year-end.

                                      R-29
<PAGE>

                                                        EXHIBIT A to Schedule II

                   LOAN INFORMATION TO BE PROVIDED TO COMPANY

                                      R-30
<PAGE>

                                    EXHIBIT S

                          FORM OF FORM 10-K CERTIFICATE

      I, [identify the certifying individual], certify that:

      1. I have reviewed the annual report on Form 10-K for the fiscal year
[___], and all reports on Form 8-K containing distribution or servicing reports
filed in respect of periods included in the year covered by that annual report,
of the trust (the "Trust") created pursuant to the Pooling and Servicing
Agreement dated December 1, 2003 (the "P&S Agreement") among ABN AMRO Mortgage
Corporation (the "Depositor"), Washington Mutual Mortgage Securities Corp. (the
"Servicer") and U.S. Bank National Association (the "Trustee");

      2. Based on my knowledge, the information in these reports, taken as a
whole, does not contain any untrue statement of a material fact or omit to state
a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
last day of the period covered by this annual report;

      3. Based on my knowledge, the servicing information required to be
provided to the Trustee by the Servicer under the P&S Agreement for inclusion in
these reports is included in these reports;

      4. I am responsible for reviewing the activities performed by the Servicer
under the P&S Agreement and based upon my knowledge and the annual compliance
review required under the P&S Agreement, and except as disclosed in the reports,
the Servicer has fulfilled its obligations under the P&S Agreement; and

      5. The reports disclose all significant deficiencies relating to the
Servicer's compliance with the minimum servicing standards based upon the report
provided by an independent public accountant, after conducting a review in
compliance with the Uniform Single Attestation Program for Mortgage Bankers as
set forth in the P&S Agreement, that is included in these reports.

Date:____________

_________________________________*
[Signature]
Name:
Title:

* - to be signed by the senior officer in charge of the servicing functions of
the Servicer.

                                       S-1
<PAGE>

                                    EXHIBIT T

             FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE

      The undersigned, [U.S. Bank National Association, solely in its capacity
as trustee (the "Trustee")] [ABN AMRO Mortgage Corporation as depositor (the
"Depositor")] under that certain Pooling and Servicing Agreement dated as of
December 1, 2003 ( the "Agreement") among ABN AMRO Mortgage Corporation,
Washington Mutual Securities Corp. and U.S. Bank National Association, certifies
that,

      1.    At the specific request of the Servicer pursuant to Section 4.2(c)
            of the Agreement ("Servicer's Request"), the [Depositor] [Trustee]
            has provided to the Servicer [describe report or other information
            being provided] (the "Information"), a copy of which Servicer's
            Request and Information is attached hereto.

      2.    Subject to paragraph 3 below and based on the knowledge of the
            officer of the [Depositor] [Trustee] signing this certification, the
            Information provided by the [Depositor] [Trustee] pursuant to the
            Servicer's Request, taken as a whole, accurately sets forth the
            information in the [Depositor's] [Trustee's] possession that has
            been specifically requested by the Servicer and does not contain any
            untrue statement of a material fact or omit to state a material fact
            necessary to make the Information provided not a misleading response
            to the Servicer's Request as of the last day of the period covered
            by the annual report to be prepared by the Servicer [for fiscal year
            ______] in accordance with Section 4.2(c) of the Agreement.

      3.    In compiling the Information and making the foregoing
            certifications, the [Depositor] [Trustee] has relied upon
            information provided to the [Depositor] [Trustee] by the Servicer,
            the [Depositor] [Trustee] and third parties, as applicable. The
            [Depositor] [Trustee] shall have no responsibility or liability for
            any inaccuracy in the Information provided resulting from
            information so provided to it by the Servicer, the [Depositor]
            [Trustee] or any other third party, as applicable.

      4.    For purposes of this certificate, an officer shall mean any officer
            of the [Depositor] [Trustee] with direct responsibility for the
            administration of the Agreement [and shall also mean, with respect
            to a particular corporate trust matter,] any other officer to whom
            such matter is referred because of his or her knowledge and
            familiarity with the particular subject.

      Capitalized terms used and not defined herein shall have the meanings
given such terms in the Agreement.

                                       T-1
<PAGE>

      IN WITNESS THEREOF, I have duly executed this certificate as of
____________, 20___

[U.S. Bank National Association, as Trustee]
[ABN AMRO Mortgage Corporation, as Depositor]

By:_______________________________
Name:_____________________________
Title:____________________________

                                       T-2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00059-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00059-of-00352.parquet"}]]