Document:

EXHIBIT 4.3

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                             FORM OF TRUST AGREEMENT

                RESIDENTIAL FUNDING MORTGAGE SECURITIES II, INC.,

                                  as Depositor

                                       and

                           [_______________________],

                                as Owner Trustee

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

                      AMENDED AND RESTATED TRUST AGREEMENT

                     Dated as of [___________ ___], 20[___]

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

                         Home Loan-Backed Certificates,
                               Series 20[__]-[__]

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                                TABLE OF CONTENTS
                                                                            Page
                                                                            ----
ARTICLE I        DEFINITIONS...................................................1

    Section 1.01.   Definitions................................................1
    Section 1.02.   Other Definitional Provisions..............................1

ARTICLE II       ORGANIZATION..................................................2

    Section 2.01.   Name.......................................................2
    Section 2.02.   Office.....................................................2
    Section 2.03.   Purposes and Powers........................................2
    Section 2.04.   Appointment of Owner Trustee...............................3
    Section 2.05.   Initial Capital Contribution of Owner Trust Estate.........3
    Section 2.06.   Declaration of Trust.......................................3
    Section 2.07.   Liability of the Holders of the Certificates...............3
    Section 2.08.   Title to Trust Property....................................4
    Section 2.09.   Situs of Trust.............................................4
    Section 2.10.   Representations and Warranties of the Depositor............4
    Section 2.11.   Payment of Trust Fees......................................5

ARTICLE III      CONVEYANCE OF THE HOME LOANS; CERTIFICATES....................5

    Section 3.01.   Conveyance of the Home Loans...............................5
    Section 3.02.   Initial Ownership..........................................5
    Section 3.03.   The Certificates...........................................5
    Section 3.04.   Authentication of Certificates.............................6
    Section 3.05.   Registration of and Limitations on Transfer and
                    Exchange of Certificates...................................6
    Section 3.06.   Mutilated, Destroyed, Lost or Stolen Certificates..........9
    Section 3.07.   Persons Deemed Certificateholders..........................9
    Section 3.08.   Access to List of Certificateholders' Names
                    and Addresses..............................................9
    Section 3.09.   Maintenance of Office or Agency...........................10
    Section 3.10.   Certificate Paying Agent..................................10
    Section 3.11.   Cooperation...............................................11

ARTICLE IV       AUTHORITY AND DUTIES OF OWNER TRUSTEE........................11

    Section 4.01.   General Authority.........................................11

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                                TABLE OF CONTENTS
                                   (continued)
                                                                            Page
                                                                            ----
    Section 4.02.   General Duties............................................12
    Section 4.03.   Action upon Instruction...................................12
    Section 4.04.   No Duties Except as Specified under Specified
                    Documents or in Instructions..............................12
    Section 4.05.   Restrictions..............................................13
    Section 4.06.   Prior Notice to Certificateholders and the Credit
                    Enhancer with Respect to Certain Matters..................13
    Section 4.07.   Action by Certificateholders with Respect to
                    Certain Matters...........................................14
    Section 4.08.   Action by Certificateholders with Respect
                    to Bankruptcy.............................................14
    Section 4.09.   Restrictions on Certificateholders' Power.................14
    Section 4.10.   Majority Control..........................................14
    Section 4.11.   Doing Business in Other Jurisdictions.....................14

ARTICLE V        APPLICATION OF TRUST FUNDS...................................15

    Section 5.01.   Distributions.............................................15
    Section 5.02.   Method of Payment.........................................15
    Section 5.03.   Signature on Returns......................................16
    Section 5.04.   Statements to Certificateholders..........................16
    Section 5.05.   Tax Reporting.............................................16
    Section 5.06.   Derivative Contracts......................................16

ARTICLE VI       CONCERNING THE OWNER TRUSTEE.................................17

    Section 6.01.   Acceptance of Trusts and Duties...........................17
    Section 6.02.   Furnishing of Documents...................................18
    Section 6.03.   Representations and Warranties............................18
    Section 6.04.   Reliance; Advice of Counsel...............................19
    Section 6.05.   Not Acting in Individual Capacity.........................20
    Section 6.06.   Owner Trustee Not Liable for Certificates
                    or Related Documents......................................20
    Section 6.07.   Owner Trustee May Own Certificates and Notes..............20

ARTICLE VII      COMPENSATION OF OWNER TRUSTEE................................20

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                                TABLE OF CONTENTS
                                   (continued)
                                                                            Page
                                                                            ----
    Section 7.01.   Owner Trustee's Fees and Expenses.........................20
    Section 7.02.   Indemnification...........................................20

ARTICLE VIII     TERMINATION OF TRUST AGREEMENT...............................21

    Section 8.01.   Termination of Trust Agreement............................21

ARTICLE IX       SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES.......22

    Section 9.01.   Eligibility Requirements for Owner Trustee................22
    Section 9.02.   Replacement of Owner Trustee..............................22
    Section 9.03.   Successor Owner Trustee...................................23
    Section 9.04.   Merger or Consolidation of Owner Trustee..................23
    Section 9.05.   Appointment of Co-Trustee or Separate Trustee.............23

ARTICLE X          MISCELLANEOUS..............................................25

    Section 10.01.  Amendments................................................25
    Section 10.02.  No Legal Title to Owner Trust Estate......................27
    Section 10.03.  Limitations on Rights of Others...........................27
    Section 10.04.  Notices...................................................27
    Section 10.05.  Severability..............................................27
    Section 10.06.  Separate Counterparts.....................................28
    Section 10.07.  Successors and Assigns....................................28
    Section 10.08.  No Petition...............................................28
    Section 10.09.  No Recourse...............................................28
    Section 10.10.  Headings..................................................28
    Section 10.11.  GOVERNING LAW.............................................28
    Section 10.12.  Integration...............................................28
    Section 10.13.  Rights of Credit Enhancer to Exercise Rights
                    of Certificateholders.....................................28

ARTICLE XI            COMPLIANCE WITH REGULATION AB...........................29

    Section 11.01.  Intent of the Parties; Reasonableness.....................29

                                     -iii-
<PAGE>

                                TABLE OF CONTENTS
                                  (continued)
                                                                            Page
                                                                            ----
    Section 11.02.  Additional Representations and Warranties
                    of the Owner Trustee......................................29
    Section 11.03.  Information to Be Provided by the Owner Trustee...........30
    Section 11.04.  Indemnification; Remedies.................................32

Exhibit A         Form of Home Loan Backed Certificate
Exhibit B         Certificate of Trust of Home Loan Trust 20[__]-[__]
Exhibit C         Form of Rule 144A Investment Representation
Exhibit D         Form of Investor Representation Letter
Exhibit E         Form of Transferor Representation Letter
Exhibit F         Certificate of Non-Foreign Status
Exhibit G         Form of ERISA Representation Letter

                                      -iv-
<PAGE>

      This Amended and Restated Trust Agreement,  dated as of [___________ ___],
20[___]  (as  amended  from  time to  time,  this  "Trust  Agreement"),  between
RESIDENTIAL  FUNDING MORTGAGE  SECURITIES II, INC., a Delaware  corporation,  as
depositor (the  "Depositor") and  [_______________________],  a Delaware banking
corporation, as owner trustee (the "Owner Trustee"),

                                WITNESSETH THAT:

      WHEREAS,  the  Depositor  and  the  Owner  Trustee  entered  into a  trust
agreement dated as of [__________ __], 20[__],  in connection with the formation
of a Delaware statutory trust (the "Original Trust Agreement");

      WHEREAS, the Depositor and the Owner Trustee wish to amend and restate the
Original Trust Agreement;

      NOW,   THEREFORE,   in  consideration  of  the  mutual  agreements  herein
contained, the Depositor and the Owner Trustee agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

      Section  1.01.  Definitions.  For all  purposes  of this Trust  Agreement,
except as otherwise  expressly  provided herein or unless the context  otherwise
requires, capitalized terms not otherwise defined herein shall have the meanings
assigned to such terms in Appendix A to the Indenture dated  [___________  ___],
20[___] (the "Indenture"),  between Home Loan Trust 20[__]-[__],  as issuer, and
[_____________________],  as indenture trustee. All other capitalized terms used
herein shall have the meanings specified herein.

      Section 1.02. Other Definitional Provisions.

      (a) All terms  defined in this  Trust  Agreement  shall  have the  defined
meanings  when  used in any  certificate  or other  document  made or  delivered
pursuant hereto unless otherwise defined therein.

      (b) As  used in this  Trust  Agreement  and in any  certificate  or  other
document  made or delivered  pursuant  hereto or thereto,  accounting  terms not
defined in this Trust  Agreement or in any such  certificate or other  document,
and  accounting  terms  partly  defined in this Trust  Agreement  or in any such
certificate  or  other  document  to the  extent  not  defined,  shall  have the
respective   meanings  given  to  them  under  generally   accepted   accounting
principles. To the extent that the definitions of accounting terms in this Trust
Agreement or in any such certificate or other document are inconsistent with the
meanings of such terms  under  generally  accepted  accounting  principles,  the
definitions  contained  in this Trust  Agreement or in any such  certificate  or
other document shall control.

<PAGE>

      (c) The words "hereof," "herein,"  "hereunder" and words of similar import
when used in this Trust Agreement shall refer to this Trust Agreement as a whole
and not to any particular  provision of this Trust Agreement;  Article,  Section
and Exhibit  references  contained in this Trust  Agreement  are  references  to
Articles,  Sections and Exhibits in or to this Trust Agreement  unless otherwise
specified; and the term "including" shall mean "including without limitation".

      (d) The  definitions  contained in this Trust  Agreement are applicable to
the singular as well as the plural  forms of such terms and to the  masculine as
well as to the feminine and neuter genders of such terms.

      (e) Any agreement,  instrument or statute defined or referred to herein or
in any  instrument or  certificate  delivered in connection  herewith means such
agreement,  instrument  or statute  as from time to time  amended,  modified  or
supplemented and includes (in the case of agreements or instruments)  references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.

                                   ARTICLE II

                                  ORGANIZATION

      Section 2.01.  Name. The trust created hereby (the "Trust") shall be known
as "Home Loan Trust  20[__]-[__],"  in which name the Owner  Trustee may conduct
the business of the Trust,  make and execute  contracts and other instruments on
behalf of the Trust and sue and be sued.

      Section  2.02.  Office.  The  office of the Trust  shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address in Delaware
as the Owner Trustee may designate by written  notice to the  Certificateholders
and the Depositor.

      Section 2.03.  Purposes and Powers.  The purpose of the Trust is to engage
in the following activities:(i) to issue the Notes pursuant to the Indenture and
the Certificates  pursuant to this Trust Agreement and to sell the Notes and the
Certificates;  (ii) to  purchase  the Home Loans and to pay the  organizational,
start-up  and  transactional  expenses  of the Trust;  (iii) to  assign,  grant,
transfer,  pledge and convey the Home Loans  pursuant  to the  Indenture  and to
hold, manage and distribute to the  Certificateholders  pursuant to Section 5.01
any  portion of the Home Loans  released  from the Lien of, and  remitted to the
Trust pursuant to, the Indenture; (iv) to enter into and perform its obligations
under the Basic  Documents to which it is to be a party;  (v) to engage in those
activities,  including entering into agreements, that are necessary, suitable or
convenient to accomplish  the foregoing or are  incidental  thereto or connected
therewith,  including, without limitation, to accept additional contributions of
equity that are not subject to the Lien of the  Indenture;  and (vi)  subject to
compliance with the Basic  Documents,  to engage in such other activities as may
be required in connection  with  conservation of the Trust Estate and the making
of distributions  to the  Certificateholders  and the Noteholders.  The Trust is
hereby  authorized  to engage in the foregoing  activities.  The Trust shall not
engage in any activity other

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<PAGE>

than in connection with the foregoing or other than as required or authorized by
the  terms of this  Trust  Agreement  or the Basic  Documents  while any Note is
outstanding  without the consent of the Holders of a majority of the Certificate
Percentage Interest of the Certificates and the Indenture Trustee.

      Section 2.04.  Appointment of Owner Trustee. The Depositor hereby appoints
the Owner  Trustee as trustee of the Trust  effective as of the date hereof,  to
have all the rights, powers and duties set forth herein.

      Section 2.05.  Initial  Capital  Contribution  of Owner Trust Estate.  The
Depositor hereby sells, assigns, transfers,  conveys and sets over to the Trust,
as of the date  hereof,  the sum of $1. The Owner  Trustee  hereby  acknowledges
receipt in trust from the  Depositor,  as of the date hereof,  of the  foregoing
contribution,  which shall  constitute the initial corpus of the Trust and shall
be deposited in the  Certificate  Distribution  Account.  The Owner Trustee also
acknowledges on behalf of the Issuer, the receipt in trust of the Home Loans and
such other  collateral  assigned to the Trust  pursuant to Section  3.01,  which
shall constitute the Owner Trust Estate.

      Section 2.06. Declaration of Trust. The Owner Trustee hereby declares that
it shall hold the Owner Trust Estate in trust upon and subject to the conditions
set forth herein for the use and benefit of the  Certificateholders,  subject to
the obligations of the Trust under the Basic  Documents.  It is the intention of
the  parties  hereto  that the Trust  constitute  a  statutory  trust  under the
Statutory Trust Statute and that this Trust  Agreement  constitute the governing
instrument of such statutory trust.  Effective as of the date hereof,  the Owner
Trustee  shall have all  rights,  powers and duties set forth  herein and in the
Statutory Trust Statute with respect to accomplishing the purposes of the Trust.
For purposes of this  Declaration  of Trust,  "Statutory  Trust  Statute"  means
Chapter 38 of Title 12 of the Delaware  Code, 12 Del. C. ss.3801 et. Seq. as the
same may be amended or  supplemented  from time to time.  It is the intention of
the  parties  hereto  that,  solely  for  federal,  state and local  income  and
franchise tax purposes, the Trust shall be treated as an entity disregarded from
the sole holder of 100% of the Certificates,  which Certificates shall initially
be owned by the Depositor or an affiliate  thereof,  and the  provisions of this
Trust Agreement shall be interpreted to further this intention. If more than one
person owns the  Certificates  for federal  income tax purposes,  then it is the
intention of the parties hereto, that solely for federal, state and local income
and franchise  tax purposes the Trust shall be treated as a  partnership  (other
than a publicly traded  partnership),  with the assets of the partnership  being
the Trust Estate,  the partners of the partnership being the  Certificateholders
and the Notes being debt of the  partnership  and the  provisions  of this Trust
Agreement  shall be  interpreted  to further this  intention.  The parties agree
that,  unless  otherwise  required by  appropriate  tax  authorities,  the Owner
Trustee  will  file or cause  to be filed  annual  or other  necessary  returns,
reports and other forms consistent with the  characterization of the Trust as an
entity wholly owned by the Depositor or an affiliate thereof, or, if two or more
persons own the  Certificates,  as a partnership  (other than a publicly  traded
partnership) for such tax purposes.

      Section 2.07. Liability of the Holders of the Certificates. The Holders of
the  Certificates  shall be liable for any  entity  level  taxes  imposed on the
Trust.

                                      -3-
<PAGE>

      Section  2.08.  Title to Trust  Property.  Legal  title to the Owner Trust
Estate  shall be vested at all times in the  Trust as a  separate  legal  entity
except where  applicable law in any  jurisdiction  requires title to any part of
the Owner  Trust  Estate to be vested in a trustee  or  trustees,  in which case
title shall be deemed to be vested in the Owner Trustee,  a co-trustee  and/or a
separate trustee, as the case may be.

      Section 2.09.  Situs of Trust.  The Trust will be located and administered
in the State of Delaware.  All bank accounts  maintained by the Owner Trustee on
behalf of the Trust  shall be located in the State of  Delaware  or the State of
New  York.  The Trust  shall not have any  employees  in any  state  other  than
Delaware;  provided, however, that nothing herein shall restrict or prohibit the
Owner Trustee from having  employees  within or without the State of Delaware or
taking  actions  outside the State of  Delaware in order to comply with  Section
2.03.  Payments will be received by the Trust only in Delaware or New York,  and
payments  will be made by the Trust  only from  Delaware  or New York.  The only
office of the Trust will be at the Corporate Trust Office in Delaware.

      Section  2.10.  Representations  and  Warranties  of  the  Depositor.  The
Depositor hereby represents and warrants to the Owner Trustee that:

            (i) The  Depositor  is duly  organized  and  validly  existing  as a
      corporation in good standing under the laws of the State of Delaware, with
      power and authority to own its  properties  and to conduct its business as
      such  properties  are  currently  owned  and such  business  is  presently
      conducted.

            (ii) The  Depositor  is duly  qualified  to do business as a foreign
      corporation  in good standing and has obtained all necessary  licenses and
      approvals  in all  jurisdictions  in which the  ownership  or lease of its
      property or the conduct of its business shall require such  qualifications
      and in which the  failure  to so qualify  would  have a  material  adverse
      effect on the  business,  properties,  assets or condition  (financial  or
      other) of the  Depositor and the ability of the Depositor to perform under
      this Trust Agreement.

            (iii) The  Depositor  has the power and  authority  to  execute  and
      deliver this Trust Agreement and to carry out its terms; the Depositor has
      full power and  authority  to sell and assign the  property to be sold and
      assigned  to and  deposited  with the  Trust as part of the  Trust and the
      Depositor has duly  authorized such sale and assignment and deposit to the
      Trust by all necessary  corporate action; and the execution,  delivery and
      performance  of this  Trust  Agreement  have been duly  authorized  by the
      Depositor by all necessary corporate action.

            (iv) The consummation of the transactions contemplated by this Trust
      Agreement and the  fulfillment  of the terms hereof do not conflict  with,
      result in any breach of any of the terms and  provisions of, or constitute
      (with or without notice or lapse of time) a default under, the articles of
      incorporation or bylaws of the Depositor,  or any indenture,  agreement or
      other  instrument  to  which  the  Depositor  is a party or by which it is
      bound;  nor result in the creation or  imposition  of any Lien upon any of
      its properties  pursuant to the terms of any such indenture,  agreement or
      other instrument (other than

                                      -4-
<PAGE>

      pursuant to the Basic  Documents);  nor violate any law or, to the best of
      the Depositor's knowledge, any order, rule or regulation applicable to the
      Depositor  of any  court  or of any  federal  or  state  regulatory  body,
      administrative  agency  or  other  governmental   instrumentality   having
      jurisdiction over the Depositor or its properties.

      Section  2.11.  Payment of Trust  Fees.  The Owner  Trustee  shall pay the
Trust's  fees and  expenses  incurred  with  respect to the  performance  of the
Trust's duties under the Indenture.

                                  ARTICLE III

                   CONVEYANCE OF THE HOME LOANS; CERTIFICATES

      Section 3.01.  Conveyance of the Home Loans.  The Depositor,  concurrently
with the execution and delivery hereof,  does hereby transfer,  convey, sell and
assign to the Trust, on behalf of the Holders of the Notes and the  Certificates
and the Credit Enhancer,  without recourse, all its right, title and interest in
and to (i) the Home Loans, all interest  accruing thereon and all collections in
respect  thereof  received on or after the Cut-off  Date,  (ii)  property  which
secured a Home Loan and which has been acquired by  foreclosure  or deed in lieu
of foreclosure, (iii) the interest of the Depositor in any insurance policies in
respect of the Home Loans, and (iv) all proceeds of the foregoing. The Depositor
will also provide the Trust with the Credit Enhancement Instrument.

      The parties hereto intend that the  transaction set forth herein be a sale
by the Depositor to the Trust of all of its right,  title and interest in and to
the Home Loans. In the event that the transaction set forth herein is not deemed
to be a sale,  the Depositor  hereby grants to the Trust a security  interest in
all of its right,  title and interest  in, to and under (i) the Home Loans,  all
interest  accruing thereon and all collections in respect thereof received on or
after the Cut-off Date,  (ii)  property  which secured a Home Loan and which has
been acquired by foreclosure or deed in lieu of foreclosure,  (iii) the interest
of the  Depositor in any  insurance  policies in respect of the Home Loans,  and
(iv)  all  proceeds  of the  foregoing  and all  distributions  thereon  and all
proceeds thereof; and this Trust Agreement shall constitute a security agreement
under applicable law.

      Section 3.02.  Initial  Ownership.  Upon the formation of the Trust by the
contribution by the Depositor  pursuant to Section 2.05 and until the conveyance
of the Home Loans pursuant to Section 3.01 and the issuance of the Certificates,
the Depositor shall be the sole Certificateholder.

      Section 3.03.  The  Certificates.  The  Certificates  shall be issued in a
single denomination of a 100% Certificate Percentage Interest.

      The  Certificates  shall be  executed  on behalf of the Trust by manual or
facsimile   signature  of  an  authorized  officer  of  the  Owner  Trustee  and
authenticated in the manner provided in Section 3.04.  Certificates  bearing the
manual or facsimile  signatures of  individuals  who were, at the time when such
signatures  shall have been affixed,  authorized to sign on behalf of the Trust,
shall be validly  issued and  entitled to the  benefit of this Trust  Agreement,
notwithstanding that

                                      -5-
<PAGE>

such  individuals or any of them shall have ceased to be so authorized  prior to
the  authentication  and  delivery  of such  Certificates  or did not hold  such
offices at the date of  authentication  and  delivery  of such  Certificates.  A
Person shall become a Certificateholder  and shall be entitled to the rights and
subject to the obligations of a  Certificateholder  hereunder upon such Person's
acceptance of a Certificate  duly registered in such Person's name,  pursuant to
Section 3.05.

      A transferee of a Certificate shall become a  Certificateholder  and shall
be entitled to the rights and subject to the obligations of a  Certificateholder
hereunder upon such transferee's  acceptance of a Certificate duly registered in
such  transferee's  name pursuant to and upon satisfaction of the conditions set
forth in Section 3.05.

      Section  3.04.  Authentication  of  Certificates.  Concurrently  with  the
acquisition of the Home Loans by the Trust, the Owner Trustee or the Certificate
Paying Agent shall cause the Certificates in an initial  Certificate  Percentage
Interest  of 100% to be  executed  on behalf  of the  Trust,  authenticated  and
delivered to or upon the written order of the Depositor,  signed by its chairman
of the board,  its president or any vice president,  without  further  corporate
action by the  Depositor,  in authorized  denominations.  No  Certificate  shall
entitle its holder to any benefit under this Trust Agreement or be valid for any
purpose  unless  there  shall  appear  on  such  Certificate  a  certificate  of
authentication substantially in the form set forth in Exhibit A, executed by the
Owner  Trustee  or the  Certificate  Paying  Agent,  by manual  signature;  such
authentication shall constitute  conclusive evidence that such Certificate shall
have been duly authenticated and delivered hereunder.  All Certificates shall be
dated the date of their authentication.

      Section 3.05.  Registration of and Limitations on Transfer and Exchange of
Certificates.

      (a) The  Certificate  Registrar  shall  keep or cause  to be kept,  at the
office or agency maintained pursuant to Section 3.09, a Certificate  Register in
which,  subject  to  such  reasonable  regulations  as  it  may  prescribe,  the
Certificate  Registrar shall provide for the registration of Certificates and of
transfers  and  exchanges of  Certificates  as herein  provided.  The  Indenture
Trustee shall be the initial Certificate Registrar. If the Certificate Registrar
resigns or is removed,  the Owner Trustee shall appoint a successor  Certificate
Registrar.

      Subject to satisfaction of the conditions set forth below,  upon surrender
for  registration  of  transfer  of any  Certificate  at the  office  or  agency
maintained   pursuant  to  Section  3.09,   the  Owner  Trustee  shall  execute,
authenticate  and  deliver  (or shall  cause the  Certificate  Registrar  as its
authenticating agent to authenticate and deliver), in the name of the designated
transferee  or  transferees,   one  or  more  new   Certificates  in  authorized
denominations of a like aggregate amount dated the date of authentication by the
Owner Trustee or any authenticating agent. At the option of a Certificateholder,
Certificates may be exchanged for other Certificates of authorized denominations
of a like aggregate amount upon surrender of the Certificates to be exchanged at
the office or agency maintained pursuant to Section 3.09.

      Every Certificate presented or surrendered for registration of transfer or
exchange  shall be  accompanied  by a written  instrument  of  transfer  in form
satisfactory to the Certificate Registrar duly executed by the Certificateholder
or  such   Certificateholder's   attorney  duly  authorized  in  writing.   Each
Certificate surrendered for registration of transfer or exchange shall

                                      -6-
<PAGE>

be  cancelled  and  subsequently  disposed of by the  Certificate  Registrar  in
accordance with its customary practice.

      No  service  charge  shall be made for any  registration  of  transfer  or
exchange of Certificates, but the Owner Trustee or the Certificate Registrar 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.

      Except as  described  below,  no transfer of any  Certificate  or interest
therein  shall be made to any Person that is not a United  States  Person.  Each
Certificateholder  shall establish its  non-foreign  status by submitting to the
Certificate  Paying  Agent an IRS Form W-9 and the  Certificate  of  Non-Foreign
Status set forth in Exhibit F hereto.

      A  Certificate  may  be  transferred  to  a  Certificateholder  unable  to
establish its non-foreign status as described in the preceding paragraph only if
such Certificateholder  provides an Opinion of Counsel, which Opinion of Counsel
shall not be an  expense  of the  Trust,  the  Owner  Trustee,  the  Certificate
Registrar  or the  Depositor,  satisfactory  to the  Depositor  and  the  Credit
Enhancer, that such transfer (1) will not affect the tax status of the Trust and
(2) will not  adversely  affect  the  interests  of any  Certificateholder,  any
Noteholder or the Credit Enhancer, including, without limitation, as a result of
the  imposition  of any United  States  federal  withholding  taxes on the Trust
(except to the extent that such  withholding  taxes would be payable solely from
amounts   otherwise   distributable   to  the  Certificate  of  the  prospective
transferee).  If such transfer occurs and such foreign Certificateholder becomes
subject to such United States federal  withholding taxes, any such taxes will be
withheld by the  Certificate  Paying  Agent.  Each  Certificateholder  unable to
establish its non-foreign  status shall submit to the Certificate Paying Agent a
copy of its Form W-8BEN and shall resubmit such Form W-8BEN every three years.

      (b) (i) No transfer,  sale,  pledge or other  disposition of a Certificate
shall be made unless such transfer,  sale, pledge or other disposition is exempt
from the  registration  requirements  of the  Securities  Act and any applicable
state  securities  laws or is made in accordance  with said Act and laws. In the
event of any such transfer,  the  Certificate  Registrar or the Depositor  shall
prior to such  transfer  require  the  transferee  to execute  (A) either (i) an
investment  letter in substantially the form attached hereto as Exhibit C (or in
such form and substance reasonably satisfactory to the Certificate Registrar and
the Depositor)  which  investment  letters shall not be an expense of the Trust,
the Owner  Trustee,  the  Certificate  Registrar,  the  Master  Servicer  or the
Depositor  and which  investment  letter states that,  among other things,  such
transferee (a) 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 (b) is  aware  that  the  proposed
transferor intends to rely on the exemption from registration requirements under
the  Securities  Act,  provided  by Rule 144A or (ii) (a) a written  Opinion  of
Counsel acceptable to and in form and substance  satisfactory to the Certificate
Registrar  and the  Depositor  that such  transfer  may be made  pursuant  to an
exemption, describing the applicable exemption and the basis therefor, from said
Act and laws or is being made  pursuant to said Act and laws,  which  Opinion of
Counsel shall not be an expense of the Trust, the Owner Trustee, the Certificate
Registrar,  the Master Servicer or the Depositor and (b) the transferee executes
a representation letter, substantially in the form of Exhibit D hereto, and

                                      -7-
<PAGE>

the transferor  executes a representation  letter,  substantially in the form of
Exhibit E hereto,  each acceptable to and in form and substance  satisfactory to
the  Certificate  Registrar and the Depositor  certifying the facts  surrounding
such  transfer,  which  representation  letters  shall not be an  expense of the
Trust, the Owner Trustee, the Certificate Registrar,  the Master Servicer or the
Depositor and (B) the Certificate of Non-Foreign  Status (in  substantially  the
form  attached  hereto as Exhibit  F)  acceptable  to and in form and  substance
reasonably  satisfactory to the Certificate  Registrar and the Depositor,  which
certificate  shall  not be an  expense  of the  Trust,  the Owner  Trustee,  the
Certificate  Registrar or the Depositor.  If the  Certificateholder is unable to
provide a Certificate of Non-Foreign Status, the Certificateholder  must provide
an  Opinion  of  Counsel  as  described   in  the   preceding   paragraph.   The
Certificateholder  desiring to effect such transfer shall, and does hereby agree
to,  indemnify the Trust,  the Owner Trustee,  the  Certificate  Registrar,  the
Master  Servicer and the Depositor  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.

      (ii) No transfer of Certificates or any interest  therein shall be made to
any Person unless the Depositor,  the Owner Trustee,  the Certificate  Registrar
and the Master  Servicer are provided  with an Opinion of Counsel  acceptable to
and in form and substance satisfactory to the Depositor,  the Owner Trustee, the
Certificate  Registrar  and the Master  Servicer to the effect that the purchase
and holding of  Certificates  is  permissible  under  applicable  law,  will not
constitute or result in any prohibited  transaction  under ERISA or Section 4975
of the Code (or comparable provisions of any subsequent enactments) and will not
subject the  Depositor,  the Owner  Trustee,  the  Certificate  Registrar or the
Master  Servicer  to any  obligation  or  liability  (including  obligations  or
liabilities  under  ERISA or  Section  4975 of the  Code) in  addition  to those
undertaken  in this Trust  Agreement,  which  Opinion of Counsel shall not be an
expense of the Depositor,  the Owner Trustee,  the Certificate  Registrar or the
Master  Servicer.  In lieu of such Opinion of Counsel,  a Person  acquiring such
Certificates  may provide a certification in the form of Exhibit G to this Trust
Agreement, which the Depositor, the Owner Trustee, the Certificate Registrar and
the Master Servicer may rely upon without further inquiry or  investigation,  or
such other  certifications as the Depositor,  the Owner Trustee, the Certificate
Registrar  or the Master  Servicer  may deem  desirable or necessary in order to
establish that such Person is not an employee benefit plan or other plan subject
to the  prohibited  transaction  provisions of ERISA or Section 4975 of the Code
(each, a "Plan"),  or any Person (including,  without  limitation,  an insurance
company investing its general account,  an investment manager, a named fiduciary
or a trustee of any Plan) who is using "plan assets,"  within the meaning of the
U.S. Department of Labor regulation promulgated at 29 C.F.R. Section 2510.3-101,
as modified by Section 3(42) of ERISA, of any Plan (each, a "Plan  Investor") to
effect such acquisition.  Neither an Opinion of Counsel nor a certification will
be required in connection with the initial  transfer of any such  Certificate by
the Depositor to an affiliate of the Depositor (in which case,  the Depositor or
any affiliate thereof shall be deemed to have represented that such affiliate is
not a Plan or a Plan  Investor  and the  Owner  Trustee  shall  be  entitled  to
conclusively  rely upon a representation  (which,  upon the request of the Owner
Trustee, shall be a written  representation) from the Depositor of the status of
such transferee as an affiliate of the Depositor.

      (iii) In addition, no transfer of a Certificate shall be permitted, and no
such transfer shall be registered by the  Certificate  Registrar or be effective
hereunder,  unless  evidenced by an Opinion of Counsel,  which  establishes that
such transfer

                                      -8-
<PAGE>

or the  registration of such transfer would not cause the Trust to be classified
as a publicly traded  partnership,  an association  taxable as a corporation,  a
corporation or a taxable mortgage pool for federal and relevant state income tax
purposes,  which Opinion of Counsel  shall not be an expense of the  Certificate
Registrar  and shall be an expense  of the  proposed  transferee.  No Opinion of
Counsel  will be required  if such  transfer is made to a nominee of an existing
beneficial holder of a Certificate.

      (iv)  In  addition,  no  transfer,  sale,  assignment,   pledge  or  other
disposition  of a  Certificate  shall be made  unless  the  proposed  transferee
certifies,  in form and substance  reasonably  satisfactory  to the  Certificate
Registrar and the Depositor that (1) the transferee is acquiring the Certificate
for its own behalf and is not acting as agent or custodian  for any other person
or entity in connection  with such  acquisition  and (2) the transferee is not a
partnership, grantor trust or S corporation for federal income tax purposes.

      Section 3.06. Mutilated,  Destroyed,  Lost or Stolen Certificates.  If (a)
any mutilated Certificate shall be surrendered to the Certificate Registrar,  or
if the Certificate  Registrar shall receive  evidence to its satisfaction of the
destruction,  loss or theft of any  Certificate and (b) there shall be delivered
to the Certificate Registrar and the Owner Trustee such security or indemnity as
may be required  by them to save each of them and the Issuer from harm,  then in
the absence of notice to the  Certificate  Registrar  or the Owner  Trustee that
such  Certificate has been acquired by a bona fide purchaser,  the Owner Trustee
shall  execute on behalf of the Trust and the Owner  Trustee or the  Certificate
Paying  Agent,  as the Trust's  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  tenor  and  denomination.  In
connection with the issuance of any new Certificate under this Section 3.06, the
Owner  Trustee or the  Certificate  Registrar  may  require the payment of a sum
sufficient to cover any tax or other governmental  charge that may be imposed in
connection therewith.  Any duplicate Certificate issued pursuant to this Section
3.06 shall  constitute  conclusive  evidence of  ownership  in the Trust,  as if
originally  issued,  whether or not the lost,  stolen or  destroyed  Certificate
shall be found at any time.

      Section 3.07. Persons Deemed Certificateholders. Prior to due presentation
of  a  Certificate  for  registration  of  transfer,   the  Owner  Trustee,  the
Certificate  Registrar or any  Certificate  Paying Agent may treat the Person in
whose name any  Certificate  is  registered in the  Certificate  Register as the
owner of such Certificate for the purpose of receiving distributions pursuant to
Section 5.02 and for all other purposes  whatsoever,  and none of the Trust, the
Owner Trustee,  the Certificate  Registrar or any Paying Agent shall be bound by
any notice to the contrary.

      Section 3.08. Access to List of  Certificateholders'  Names and Addresses.
The  Certificate  Registrar  shall  furnish  or  cause  to be  furnished  to the
Depositor or the Owner Trustee,  within 15 days after receipt by the Certificate
Registrar of a written request therefor from the Depositor or the Owner Trustee,
a list, in such form as the Depositor or the Owner Trustee,  as the case may be,
may reasonably require, of the names and addresses of the  Certificateholders as
of the most  recent  Record  Date.  Each  Holder,  by  receiving  and  holding a
Certificate,  shall be deemed to have  agreed not to hold any of the Trust,  the
Depositor,  the Certificate Registrar or the Owner Trustee accountable by reason
of the  disclosure of its name and address,  regardless of the source from which
such information was derived.

                                      -9-
<PAGE>

      Section  3.09.  Maintenance  of Office or Agency.  The Owner  Trustee,  on
behalf of the Trust, shall maintain in St. Paul,  Minnesota an office or offices
or agency or agencies where  Certificates may be surrendered for registration of
transfer or exchange and where  notices and demands to or upon the Owner Trustee
in respect of the Certificates and the Basic Documents may be served.  The Owner
Trustee initially designates the Corporate Trust Office of the Indenture Trustee
as its office for such  purposes.  The Owner Trustee  shall give prompt  written
notice to the Depositor and the Certificateholders of any change in the location
of the Certificate Register or any such office or agency.

      Section 3.10.  Certificate  Paying Agent. (a) The Certificate Paying Agent
shall make distributions to Certificateholders from the Certificate Distribution
Account  on  behalf  of the  Trust  in  accordance  with the  provisions  of the
Certificates  and Section 5.01 hereof from payments  remitted to the Certificate
Paying Agent by the Indenture Trustee pursuant to Section 3.05 of the Indenture.
The Trust hereby appoints the Indenture Trustee as Certificate Paying Agent (the
"Certificate  Paying  Agent") and the  Indenture  Trustee  hereby  accepts  such
appointment  and further  agrees that it will be bound by the provisions of this
Trust Agreement relating to the Certificate Paying Agent and shall:

            (i) hold all sums held by it for the  payment  of  amounts  due with
      respect  to the  Certificates  in trust  for the  benefit  of the  Persons
      entitled  thereto  until  such  sums  shall  be paid to  such  Persons  or
      otherwise disposed of as herein provided;

            (ii) give the Owner  Trustee  notice of any  default by the Trust of
      which it has actual  knowledge in the making of any payment required to be
      made with respect to the Certificates;

            (iii) at any time during the  continuance of any such default,  upon
      the  written  request  of the Owner  Trustee,  forthwith  pay to the Owner
      Trustee  on  behalf  of the  Trust  all  sums  so held  in  trust  by such
      Certificate Paying Agent;

            (iv)  immediately  resign as Certificate  Paying Agent and forthwith
      pay to the  Owner  Trustee  on  behalf of the Trust all sums held by it in
      trust for the payment of Certificates if at any time it ceases to meet the
      standards  required to be met by the Certificate  Paying Agent at the time
      of its  appointment;  (v) comply  with all  requirements  of the Code with
      respect  to  the  withholding   from  any  payments  made  by  it  on  any
      Certificates of any applicable  withholding taxes imposed thereon and with
      respect to any applicable reporting  requirements in connection therewith;
      and

            (vi)  deliver  to  the  Owner  Trustee  a  copy  of  the  report  to
      Certificateholders  prepared  with  respect  to each  Payment  Date by the
      Master Servicer pursuant to Section 4.01 of the Servicing Agreement.

      (b) The Trust may revoke  such power and  remove  the  Certificate  Paying
Agent  if  the  Owner  Trustee  determines  in  its  sole  discretion  that  the
Certificate Paying Agent shall have failed to perform its obligations under this
Trust Agreement in any material respect. The

                                      -10-
<PAGE>

Indenture Trustee shall be permitted to resign as Certificate  Paying Agent upon
30 days' written notice to the Owner Trustee;  provided the Indenture Trustee is
also  resigning as Paying Agent under the  Indenture at such time.  In the event
that the Indenture Trustee shall no longer be the Certificate Paying Agent under
this Trust  Agreement  and Paying Agent under the  Indenture,  the Owner Trustee
shall appoint a successor to act as  Certificate  Paying Agent (which shall be a
bank or trust company) and which shall also be the successor  Paying Agent under
the Indenture.  The Owner Trustee shall cause such successor  Certificate Paying
Agent or any additional  Certificate Paying Agent appointed by the Owner Trustee
to execute  and  deliver to the Owner  Trustee an  instrument  to the effect set
forth in this Section 3.10 as it relates to the  Certificate  Paying Agent.  The
successor  Certificate Paying Agent shall covenant and agree that it will not at
any  time  institute  against  the  Depositor  or  the  Trust,  or  join  in any
institution  against the Depositor or the Trust of, any  bankruptcy  proceedings
under any United States federal or state bankruptcy or similar law in connection
with any obligations  with respect to any  Certificate,  this Trust Agreement or
any of the other Basic Documents.  The Certificate Paying Agent shall return all
unclaimed funds to the Trust and upon removal of a Certificate Paying Agent such
Certificate  Paying Agent shall also return all funds in its  possession  to the
Trust.  The provisions of Sections 6.01,  6.03, 6.04 and 7.01 shall apply to the
Certificate Paying Agent to the extent  applicable.  Any reference in this Trust
Agreement to the  Certificate  Paying Agent shall  include any  co-paying  agent
unless the context requires otherwise.

      (c) The Certificate  Paying Agent shall establish and maintain with itself
the Certificate Distribution Account in which the Certificate Paying Agent shall
deposit,  on the same day as it is received  from the  Indenture  Trustee,  each
remittance  received by the  Certificate  Paying  Agent with respect to payments
made  pursuant to the  Indenture.  The  Certificate  Paying Agent shall make all
distributions  of Certificate  Distribution  Amounts on the  Certificates,  from
moneys on deposit in the Certificate Distribution Account.

      Section  3.11.  Cooperation.  The Owner  Trustee  shall  cooperate  in all
respects  with any  reasonable  request  by the  Credit  Enhancer  for action to
preserve or enforce the Credit  Enhancer's  rights or interest  under this Trust
Agreement or the Insurance Agreement,  so long as such cooperation is consistent
with   this   Trust   Agreement   and  does  not   limit   the   rights  of  the
Certificateholders,  except  as  otherwise  expressly  set  forth in this  Trust
Agreement.

                                   ARTICLE IV

                      AUTHORITY AND DUTIES OF OWNER TRUSTEE

      Section 4.01.  General  Authority.  The Owner  Trustee is  authorized  and
directed to execute and deliver the Basic  Documents to which the Trust is to be
a party and each  certificate  or other  document  attached  as an exhibit to or
contemplated  by the Basic Documents to which the Trust is to be a party and any
amendment or other agreement or instrument  described  herein,  in each case, in
such form as the Owner Trustee shall approve,  as evidenced  conclusively by the
Owner  Trustee's  execution  thereof.  In addition to the  foregoing,  the Owner
Trustee is obligated to take all actions  required of the Trust  pursuant to the
Basic Documents.

                                      -11-
<PAGE>

      Section 4.02.  General  Duties.  The Owner Trustee shall be responsible to
administer the Trust pursuant to the terms of this Trust Agreement and the Basic
Documents   to  which  the  Trust  is  a  party  and  in  the  interest  of  the
Certificateholders,  subject to the Basic  Documents and in accordance  with the
provisions of this Trust Agreement.

      Section 4.03. Action upon Instruction.  (a) Subject to this Article IV and
in accordance with the terms of the Basic Documents,  the Certificateholders may
by written  instruction direct the Owner Trustee in the management of the Trust.
Such  direction  may be  exercised  at any time by  written  instruction  of the
Certificateholders pursuant to this Article IV.

      (b) Notwithstanding the foregoing, the Owner Trustee shall not be required
to take any action  hereunder or under any Basic  Document if the Owner  Trustee
shall have reasonably  determined,  or shall have been advised by counsel,  that
such action is likely to result in liability on the part of the Owner Trustee or
is  contrary  to the  terms  hereof  or of any Basic  Document  or is  otherwise
contrary to law.

      (c) Whenever  the Owner  Trustee is unable to decide  between  alternative
courses of action  permitted or required by the terms of this Trust Agreement or
under any Basic Document, or in the event that the Owner Trustee is unsure as to
the  application of any provision of this Trust  Agreement or any Basic Document
or any such provision is ambiguous as to its  application,  or is, or appears to
be, in conflict with any other applicable  provision,  or in the event that this
Trust Agreement  permits any  determination by the Owner Trustee or is silent or
is  incomplete  as to the course of action that the Owner Trustee is required to
take with respect to a particular set of facts, the Owner Trustee shall promptly
give notice (in such form as shall be appropriate  under the  circumstances)  to
the  Certificateholders   (with  a  copy  to  the  Credit  Enhancer)  requesting
instruction  as to the  course of action to be  adopted,  and to the  extent the
Owner  Trustee acts in good faith in  accordance  with any written  instructions
received from Holders of Certificates representing a majority of the Certificate
Percentage Interest thereof, the Owner Trustee shall not be liable on account of
such  action  to any  Person.  If the  Owner  Trustee  shall  not have  received
appropriate  instruction  within 10 days of such notice (or within such  shorter
period of time as reasonably may be specified in such notice or may be necessary
under the  circumstances) it may, but shall be under no duty to, take or refrain
from taking such action not inconsistent  with this Trust Agreement or the Basic
Documents,   as  it   shall   deem  to  be  in  the   best   interests   of  the
Certificateholders,  and the Owner Trustee shall have no liability to any Person
for such action or inaction.

      Section 4.04. No Duties Except as Specified under  Specified  Documents or
in  Instructions.  The Owner  Trustee  shall not have any duty or  obligation to
manage, make any payment with respect to, register, record, sell, dispose of, or
otherwise deal with the Owner Trust Estate, or to otherwise take or refrain from
taking any action under, or in connection with, any document contemplated hereby
to which the Owner  Trustee  is a party,  except as  expressly  provided  (i) in
accordance with the powers granted to and the authority conferred upon the Owner
Trustee  pursuant to this Trust  Agreement,  (ii) in  accordance  with the Basic
Documents and (iii) in accordance with any document or instruction  delivered to
the Owner Trustee pursuant to Section 4.03; and no implied duties or obligations
shall be read into this Trust Agreement or any Basic Document  against the Owner
Trustee. The Owner Trustee shall have no responsibility

                                      -12-
<PAGE>

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  prepare  or file any  Securities  and
Exchange  Commission  filing for the Trust or to record this Trust  Agreement or
any Basic Document.  The Owner Trustee  nevertheless agrees that it will, at its
own cost and expense,  promptly take all action as may be necessary to discharge
any liens on any part of the Trust Estate that result from actions by, or claims
against,  the  Owner  Trustee  that  are not  related  to the  ownership  or the
administration of the Owner Trust Estate.

      Section  4.05.  Restrictions.  (a) The  Owner  Trustee  shall not take any
action  (x) that is  inconsistent  with the  purposes  of the Trust set forth in
Section 2.03 or (y) that, to the actual  knowledge of the Owner  Trustee,  would
result in the Trust  becoming  taxable as a corporation  for federal  income tax
purposes.  The  Certificateholders  shall not direct  the Owner  Trustee to take
action that would violate the provisions of this Section 4.05.

      (b) The Owner  Trustee  shall not convey or  transfer  any of the  Trust's
properties  or assets,  including  those  included in the Trust  Estate,  to any
person  unless  (x) it shall have  received  an Opinion of Counsel to the effect
that such  transaction will not have any material adverse tax consequence to the
Trust or any  Certificateholder  and (y) such  conveyance or transfer  shall not
violate the provisions of Section 3.16(b) of the Indenture.

      Section 4.06. Prior Notice to  Certificateholders  and the Credit Enhancer
with Respect to Certain  Matters.  With respect to the  following  matters,  the
Owner Trustee shall not take action  unless,  at least 30 days before the taking
of such action, the Owner Trustee shall have notified the Certificateholders and
the  Credit   Enhancer  in  writing  of  the  proposed  action  and  Holders  of
Certificates  representing  a majority of the  Certificate  Percentage  Interest
thereof and the Credit  Enhancer  shall not have  notified the Owner  Trustee in
writing   prior  to  the  30th  day  after  such   notice  is  given  that  such
Certificateholders  and the Credit  Enhancer have  withheld  consent or provided
alternative direction:

            (a) the  initiation  of any claim or  lawsuit  by the Trust  (except
      claims or  lawsuits  brought in  connection  with the  collection  of cash
      distributions  due and owing under the Home Loans) and the  compromise  of
      any action,  claim or lawsuit brought by or against the Trust (except with
      respect to the  aforementioned  claims or lawsuits for  collection of cash
      distributions due and owing under the Home Loans);

            (b)  the  election  by  the  Trust  to  file  an  amendment  to  the
      Certificate  of Trust (unless such amendment is required to be filed under
      the Statutory Trust Statute);

            (c) the  amendment of the Indenture by a  supplemental  indenture in
      circumstances where the consent of any Noteholder is required;

            (d) the  amendment of the Indenture by a  supplemental  indenture in
      circumstances where the consent of any Noteholder is not required and such
      amendment    materially    adversely   affects   the   interest   of   the
      Certificateholders; and

                                      -13-
<PAGE>

            (e) the  appointment  pursuant to the Indenture of a successor  Note
      Registrar,  Paying  Agent or  Indenture  Trustee or pursuant to this Trust
      Agreement of a successor Certificate Registrar or Certificate Paying Agent
      or the consent to the  assignment  by the Note  Registrar,  Paying  Agent,
      Indenture  Trustee,  Certificate  Registrar or Certificate Paying Agent of
      its  obligations   under  the  Indenture  or  this  Trust  Agreement,   as
      applicable.

      Section  4.07.  Action  by  Certificateholders  with  Respect  to  Certain
Matters.  The Owner Trustee shall not have the power,  except upon the direction
of  Certificateholders  evidencing  not less than a majority of the  outstanding
Certificate Percentage Interest of the Certificates, and with the consent of the
Credit  Enhancer  (so long as no Credit  Enhancer  Default has  occurred  and is
continuing),  to (a) remove the Master  Servicer  under the Servicing  Agreement
pursuant  to Section  7.01  thereof or (b) except as  expressly  provided in the
Basic Documents, sell the Home Loans after the termination of the Indenture. The
Owner Trustee shall take the actions referred to in the preceding  sentence only
upon written instructions signed by Certificateholders  evidencing not less than
a  majority  of  the  outstanding   Certificate   Percentage   Interest  of  the
Certificates  and with the consent of the Credit  Enhancer (so long as no Credit
Enhancer Default has occurred and is continuing).

      Section 4.08. Action by Certificateholders with Respect to Bankruptcy. The
Owner  Trustee  shall not have the power to commence a voluntary  proceeding  in
bankruptcy  relating to the Trust  without the unanimous  prior  approval of all
Certificateholders  and with the consent of the Credit  Enhancer  (so long as no
Credit Enhancer  Default has occurred and is continuing) and the delivery to the
Owner Trustee by each such  Certificateholder  of a certificate  certifying that
such Certificateholder reasonably believes that the Trust is insolvent.

      Section   4.09.    Restrictions   on   Certificateholders'    Power.   The
Certificateholders shall not direct the Owner Trustee to take or to refrain from
taking any action if such action or inaction would be contrary to any obligation
of the Trust or the Owner Trustee under this Trust Agreement or any of the Basic
Documents or would be contrary to Section  2.03,  nor shall the Owner Trustee be
obligated to follow any such direction, if given.

      Section 4.10.  Majority Control.  Except as expressly provided herein, any
action that may be taken by the  Certificateholders  under this Trust  Agreement
may be taken by the  Certificateholders  evidencing  not less than a majority of
the outstanding  Certificate Percentage Interest of the Certificates.  Except as
expressly  provided  herein,  any  written  notice  of  the   Certificateholders
delivered  pursuant  to this Trust  Agreement  shall be  effective  if signed by
Certificateholders  evidencing  not  less  than a  majority  of the  outstanding
Certificate  Percentage Interest of the Certificates at the time of the delivery
of such notice.

      Section  4.11.  Doing  Business  in Other  Jurisdictions.  Notwithstanding
anything contained herein to the contrary, neither  [_____________________]  nor
the Owner Trustee shall be required to take any action in any jurisdiction other
than in the State of Delaware if the taking of such action will,  even after the
appointment of a co-trustee or separate  trustee in accordance with Section 9.05
hereof,  (i) require the consent or approval or authorization or order of or the
giving of notice to, or the registration  with or the taking of any other action
in respect of, any

                                      -14-
<PAGE>

state or other  governmental  authority or agency of any jurisdiction other than
the State of Delaware;  (ii) result in any fee, tax or other governmental charge
under   the   laws   of   the   State   of   Delaware    becoming   payable   by
[_______________________],   or  (iii)  subject   [_______________________]   to
personal  jurisdiction in any jurisdiction  other than the State of Delaware for
causes  of  action  arising  from  acts  unrelated  to the  consummation  of the
transactions by  [_______________________] or the Owner Trustee, as the case may
be, contemplated hereby.

                                   ARTICLE V

                           APPLICATION OF TRUST FUNDS

      Section 5.01.  Distributions.  (a) On each Payment Date,  the  Certificate
Paying Agent shall distribute to the  Certificateholders all funds on deposit in
the  Certificate  Distribution  Account and  available  therefor (as provided in
Section 3.05 of the Indenture),  as the Certificate Distribution Amount for such
Payment Date.  Upon  termination  of the Indenture in accordance  with the terms
thereof,  distributions to the Certificateholder shall continue to be determined
in  accordance  with the  provisions  for  distributions  in Section 3.05 of the
Indenture.  All distributions made pursuant to this Section shall be distributed
to  the  Certificateholders  on a  pro  rata  basis  based  on  the  Certificate
Percentage Interests thereof.

      (b) In the event that any withholding tax is imposed on the  distributions
(or  allocations  of income) to a  Certificateholder,  such tax shall reduce the
amount otherwise  distributable to the Certificateholder in accordance with this
Section 5.01. The Certificate  Paying Agent is hereby authorized and directed to
retain or cause to be  retained  from  amounts  otherwise  distributable  to the
Certificateholders  sufficient  funds for the payment of any tax that is legally
owed by the Trust (but such  authorization  shall not prevent the Owner  Trustee
from contesting any such tax in appropriate proceedings, and withholding payment
of such tax, if permitted by law, pending the outcome of such proceedings).  The
amount of any withholding tax imposed with respect to a Certificateholder  shall
be  treated  as cash  distributed  to such  Certificateholder  at the time it is
withheld by the Certificate  Paying Agent and remitted to the appropriate taxing
authority.  If there is a  possibility  that  withholding  tax is  payable  with
respect   to  a   distribution   (such   as  a   distribution   to  a   non-U.S.
Certificateholder),  the  Certificate  Paying  Agent may in its sole  discretion
withhold such amounts in accordance with this paragraph (b).

      (c)  Distributions  to  Certificateholders  shall be  subordinated  to the
creditors of the Trust, including the Noteholders.

      (d)  Allocations  of profits and losses,  as determined for federal income
tax purposes,  shall be made to the Certificateholders on a pro rata basis based
on the Certificate Percentage Interests thereof.

      Section 5.02. Method of Payment. Subject to Section 8.01(c), distributions
required  to be made to  Certificateholder  on any  Payment  Date as provided in
Section 5.01 shall be made to the  Certificateholder  of record on the preceding
Record Date either by wire transfer, in

                                      -15-
<PAGE>

immediately  available  funds,  to the account of such Holder at a bank or other
entity having appropriate  facilities therefor, if the  Certificateholder  shall
have provided to the Certificate  Registrar  appropriate written instructions at
least five (5)  Business  Days prior to such  Payment  Date or, if not, by check
mailed to such  Certificateholder  at the address of the Holder appearing in the
Certificate Register.

      Section  5.03.  Signature  on Returns.  To the extent  required and unless
otherwise  required by law, the Owner  Trustee shall sign on behalf of the Trust
the tax returns of the Trust.

      Section 5.04. Statements to Certificateholders.  On each Payment Date, the
Certificate    Paying   Agent   shall   make   available    electronically    at
www.[______________].com  the  statement  or  statements  provided  to the Owner
Trustee and the  Certificate  Paying  Agent by the Master  Servicer  pursuant to
Section 4.01 of the Servicing Agreement with respect to such Payment Date.

      Section 5.05. Tax Reporting.  So long as the Depositor or any affiliate of
the Depositor owns 100% of the Certificates (the "Original  Certificateholder"),
then no separate federal and state income tax returns and information returns or
statements  will be filed  with  respect  to the Trust  and a  federal  employer
identification  number  shall not be applied for from the IRS.  If the  Original
Certificateholder is no longer the sole  Certificateholder  and the Certificates
are held by the Original  Certificateholder  and one or more persons for federal
income  tax  purposes,  the  subsequent  holders  of the  Certificates  by their
acceptance  hereof,  agree to appoint the  Original  Certificateholder  as their
agent for the tax matters partner and the Original  Certificateholder,  as agent
for such  holders,  agrees to perform  (itself or through  its agent) all duties
necessary  to comply with federal and state  income tax laws  including  but not
limited to applying for a federal employer  identification number and filing tax
returns.

      Section 5.06.  Derivative  Contracts.  (a) The Owner Trustee shall, at the
direction  of the Master  Servicer,  on behalf of the Trust  Estate,  enter into
Derivative Contracts, solely for the benefit of the Certificateholder.  Any such
Derivative  Contract  shall  constitute a fully  prepaid  agreement.  The Master
Servicer  shall  determine,  in its  sole  discretion,  whether  any  Derivative
Contract   conforms  to  the  requirements  of  Section  5.06(b)  and  (c).  All
collections,  proceeds and other amounts in respect of the Derivative  Contracts
payable  by  the   Derivative   Counterparty   shall  be   distributed   to  the
Certificateholder  on the Payment Date  following  receipt  thereof by the Owner
Trustee.

      (b) Any  Derivative  Contract that provides for any payment  obligation on
the part of the Trust  Estate must (i) be without  recourse to the assets of the
Trust Estate, (ii) contain a non-petition covenant provision from the Derivative
Counterparty,  (iii) limit  payment  dates  thereunder to Payment Dates and (iv)
contain a provision limiting any cash payment due to the Derivative Counterparty
on any day under such Derivative  Contract solely to funds available therefor in
the Custodial Account available to make payment to the Certificateholder on such
Payment Date.

      (c) Each  Derivative  Contract must (i) provide for the direct  payment of
any amounts by the Derivative  Counterparty  thereunder to the Custodial Account
at least one (1) Business Day prior to the related Payment Date, (ii) contain an
assignment of all of the Trust Estate rights

                                      -16-
<PAGE>

(but  none of its  obligations)  under  such  Derivative  Contract  to the Owner
Trustee on behalf of the  Certificateholder and shall include an express consent
to the Derivative  Counterparty  to such  assignment,  (iii) provide that in the
event of the occurrence of a Servicer  Default,  such Derivative  Contract shall
terminate  upon the  direction  of a majority  Percentage  Interest of the Owner
Trust  Certificates,   and  (iv)  prohibit  the  Derivative   Counterparty  from
"setting-off"  or  "netting"  other  obligations  of the  Trust  Estate  and its
Affiliates   against  such   Derivative   Counterparty's   payment   obligations
thereunder.

      (d)  Notwithstanding the provisions of paragraphs (a), (b) and (c) of this
Section 5.06, no  Derivative  Contract  shall (i) provide for the payment of any
amounts that would otherwise be payable to the Holders of any Class of Notes, or
(ii) materially adversely affect the rights of the Holders of any Class of Notes
or the Credit Enhancer.

                                   ARTICLE VI

                          CONCERNING THE OWNER TRUSTEE

      Section 6.01.  Acceptance of Trusts and Duties.  The Owner Trustee accepts
the  trusts  hereby  created  and agrees to perform  its duties  hereunder  with
respect  to such  trusts but only upon the terms of this  Trust  Agreement.  The
Owner Trustee and the Certificate Paying Agent also agree to disburse all moneys
actually  received by it  constituting  part of the Owner Trust  Estate upon the
terms of the Basic Documents and this Trust  Agreement.  The Owner Trustee shall
not be answerable or accountable hereunder or under any Basic Document under any
circumstances,  except (i) for its own  willful  misconduct,  negligence  or bad
faith or negligent  failure to act or (ii) in the case of the  inaccuracy of any
representation or warranty contained in Section 6.03 expressly made by the Owner
Trustee.  In  particular,  but  not by way of  limitation  (and  subject  to the
exceptions set forth in the preceding sentence):

      (a) No  provision  of this Trust  Agreement  or any Basic  Document  shall
require  the  Owner  Trustee  to  expend or risk  funds or  otherwise  incur any
financial  liability in the  performance of any of its rights,  duties or powers
hereunder or under any Basic Document if the Owner Trustee shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured or provided to it;

      (b)  Under  no  circumstances  shall  the  Owner  Trustee  be  liable  for
indebtedness evidenced by or arising under any of the Basic Documents, including
the principal of and interest on the Notes;

      (c) The Owner  Trustee shall not be  responsible  for or in respect of the
validity or sufficiency of this Trust Agreement or for the due execution  hereof
by the Depositor or for the form, character, genuineness,  sufficiency, value or
validity of any of the Owner Trust Estate,  or for or in respect of the validity
or sufficiency of the Basic Documents,  the Notes, the Certificates,  other than
the certificate of authentication on the Certificates,  if executed by the Owner
Trustee and the Owner Trustee  shall in no event assume or incur any  liability,
duty, or obligation to any

                                      -17-
<PAGE>

Noteholder  or to any  Certificateholder,  other than as expressly  provided for
herein or expressly agreed to in the Basic Documents;

      (d) The execution, delivery,  authentication and performance by it of this
Trust Agreement will not require the authorization,  consent or approval of, the
giving of notice to, the filing or registration with, or the taking of any other
action with respect to, any governmental authority or agency;

      (e) The Owner Trustee shall not be liable for the default or misconduct of
the  Depositor,  the Indenture  Trustee or the Master  Servicer under any of the
Basic  Documents or otherwise  and the Owner Trustee shall have no obligation or
liability to perform the  obligations of the Trust under this Trust Agreement or
the Basic  Documents that are required to be performed by the Indenture  Trustee
under the Indenture or the Seller under the Home Loan Purchase Agreement; and

      (f) The Owner  Trustee shall be under no obligation to exercise any of the
rights or powers vested in it or duties imposed by this Trust  Agreement,  or to
institute,  conduct or defend any  litigation  under  this  Trust  Agreement  or
otherwise or in relation to this Trust Agreement or any Basic  Document,  at the
request,  order  or  direction  of any of the  Certificateholders,  unless  such
Certificateholders  have  offered to the Owner  Trustee  security  or  indemnity
satisfactory  to it against  the costs,  expenses  and  liabilities  that may be
incurred by the Owner Trustee therein or thereby. The right of the Owner Trustee
to perform any  discretionary  act enumerated in this Trust  Agreement or in any
Basic Document shall not be construed as a duty, and the Owner Trustee shall not
be answerable for other than its negligence,  bad faith or willful misconduct in
the performance of any such act.

      Section 6.02. Furnishing of Documents.  The Owner Trustee shall furnish to
the  Securityholders  promptly  upon  receipt  of a written  reasonable  request
therefor,  duplicates  or copies of all  reports,  notices,  requests,  demands,
certificates,  financial  statements and any other instruments  furnished to the
Trust under the Basic Documents.

      Section 6.03.  Representations  and  Warranties.  The Owner Trustee hereby
represents   and   warrants   to  the   Depositor,   for  the   benefit  of  the
Certificateholders, that:

            (a) It is a banking  corporation duly organized and validly existing
      in good  standing  under  the laws of the  State of  Delaware.  It has all
      requisite  corporate  power and authority to execute,  deliver and perform
      its obligations under this Trust Agreement;

            (b) It has taken all  corporate  action  necessary to authorize  the
      execution  and  delivery  by it of this  Trust  Agreement,  and this Trust
      Agreement  will be executed  and  delivered  by one of its officers who is
      duly authorized to execute and deliver this Trust Agreement on its behalf;

            (c)  Neither  the  execution  nor the  delivery  by it of this Trust
      Agreement,  nor the  consummation by it of the  transactions  contemplated
      hereby nor  compliance  by it with any of the terms or  provisions  hereof
      will  contravene  any  federal  or  Delaware  law,  governmental  rule  or
      regulation governing the banking or trust powers of the Owner

                                      -18-
<PAGE>

      Trustee or any judgment or order binding on it, or constitute  any default
      under  its  charter  documents  or  bylaws  or  any  indenture,  mortgage,
      contract,  agreement or  instrument to which it is a party or by which any
      of its properties may be bound;

            (d) This Trust Agreement, assuming due authorization,  execution and
      delivery by the Owner  Trustee  and the  Depositor,  constitutes  a valid,
      legal and binding obligation of the Owner Trustee,  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;

            (e) The Owner Trustee 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 Owner Trustee or its  properties
      or might have  consequences  that would  materially  adversely  affect its
      performance hereunder; and

            (f) No litigation is pending or, to the best of the Owner  Trustee's
      knowledge,  threatened  against the Owner Trustee which would prohibit its
      entering into this Trust  Agreement or performing  its  obligations  under
      this Trust Agreement.

      Section  6.04.  Reliance;  Advice of Counsel.  (a) The Owner Trustee shall
incur no liability to anyone in acting upon any signature,  instrument,  notice,
resolution,  request,  consent,  order,  certificate,  report, opinion, bond, or
other  document or paper  believed by it to be genuine and  believed by it to be
signed by the proper party or parties.  The Owner Trustee may accept a certified
copy of a resolution  of the board of directors or other  governing  body of any
corporate  party as  conclusive  evidence  that  such  resolution  has been duly
adopted  by such body and that the same is in full force and  effect.  As to any
fact or  matter  the  method  of  determination  of  which  is not  specifically
prescribed  herein,  the Owner  Trustee  may for all  purposes  hereof rely on a
certificate,  signed by the president or any vice  president or by the treasurer
or other  authorized  officers of the relevant  party, as to such fact or matter
and such  certificate  shall constitute full protection to the Owner Trustee for
any action taken or omitted to be taken by it in good faith in reliance thereon.

      (b) In the exercise or  administration  of the Trust  hereunder and in the
performance  of its duties and  obligations  under this Trust  Agreement  or the
Basic  Documents,  the Owner Trustee (i) may act directly or through its agents,
attorneys,  custodians or nominees  (including  persons  acting under a power of
attorney)  pursuant to agreements  entered into with any of them,  and the Owner
Trustee  shall not be liable  for the  conduct  or  misconduct  of such  agents,
attorneys,  custodians or nominees  (including  persons  acting under a power of
attorney)  if  such  persons  have  been  selected  by the  Owner  Trustee  with
reasonable  care,  and (ii) may  consult  with  counsel,  accountants  and other
skilled  persons to be selected with  reasonable  care and employed by it at the
expense of the Trust.  The Owner Trustee shall not be liable for anything  done,
suffered or omitted in good faith by it in accordance with the opinion or advice
of any such

                                      -19-
<PAGE>

counsel,  accountants  or other  such  Persons  and not  contrary  to this Trust
Agreement or any Basic Document.

      Section  6.05.  Not Acting in Individual  Capacity.  Except as provided in
this    Article    VI,    in    accepting    the    trusts    hereby     created
[_______________________]  acts solely as Owner Trustee hereunder and not in its
individual capacity,  and all Persons having any claim against the Owner Trustee
by reason of the transactions  contemplated by this Trust Agreement or any Basic
Document  shall look only to the Owner Trust Estate for payment or  satisfaction
thereof.

      Section  6.06.  Owner  Trustee  Not  Liable  for  Certificates  or Related
Documents. The recitals contained herein and in the Certificates (other than the
signatures  of the  Owner  Trustee  on the  Certificates)  shall be taken as the
statements of the Depositor, and the Owner Trustee assumes no responsibility for
the correctness  thereof.  The Owner Trustee makes no  representations as to the
validity or sufficiency of this Trust Agreement, of any Basic Document or of the
Certificates   (other  than  the   signatures   of  the  Owner  Trustee  on  the
Certificates) or the Notes, or of any Related Documents. The Owner Trustee shall
at no time have any  responsibility or liability with respect to the sufficiency
of the  Owner  Trust  Estate or its  ability  to  generate  the  payments  to be
distributed to Certificateholders  under this Trust Agreement or the Noteholders
under the  Indenture,  including,  the compliance by the Depositor or the Seller
with any  warranty  or  representation  made under any Basic  Document or in any
related document or the accuracy of any such warranty or representation,  or any
action  of the  Certificate  Paying  Agent,  the  Certificate  Registrar  or the
Indenture Trustee taken in the name of the Owner Trustee.

      Section 6.07.  Owner  Trustee May Own  Certificates  and Notes.  The Owner
Trustee in its  individual or any other capacity may become the owner or pledgee
of  Certificates  or Notes  and may deal with the  Depositor,  the  Seller,  the
Certificate Paying Agent, the Certificate Registrar and the Indenture Trustee in
transactions with the same rights as it would have if it were not Owner Trustee.

                                  ARTICLE VII

                          COMPENSATION OF OWNER TRUSTEE

      Section 7.01.  Owner Trustee's Fees and Expenses.  The Owner Trustee shall
receive  as  compensation  for its  services  hereunder  such  fees as have been
separately  agreed upon before the date hereof,  and the Owner  Trustee shall be
reimbursed for its reasonable  expenses hereunder and under the Basic Documents,
including  the  reasonable  compensation,  expenses  and  disbursements  of such
agents, representatives, experts and counsel as the Owner Trustee may reasonably
employ in  connection  with the exercise and  performance  of its rights and its
duties  hereunder  and under the Basic  Documents  which shall be payable by the
Master Servicer pursuant to Section 3.09 of the Servicing Agreement.

      Section 7.02. Indemnification. The Master Servicer shall indemnify, defend
and hold harmless the Owner Trustee as provided in Section 6.06 of the Servicing
Agreement.

                                      -20-
<PAGE>

                                  ARTICLE VIII

                         TERMINATION OF TRUST AGREEMENT

      Section 8.01.  Termination of Trust  Agreement.  (a) This Trust  Agreement
(other  than  this  Article  VIII) and the Trust  shall  terminate  and be of no
further force or effect upon the earliest of (i) the final  distribution  of all
moneys or other  property or proceeds  of the Owner Trust  Estate in  accordance
with the terms of the Indenture and this Trust Agreement,  (ii) the Payment Date
in [____________]  20[___],  or (iii) the purchase by the Master Servicer of all
Home  Loans  pursuant  to  Section  8.08(a)  of  the  Servicing  Agreement.  The
bankruptcy,    liquidation,    dissolution,   death   or   incapacity   of   any
Certificateholder shall not (x) operate to terminate this Trust Agreement or the
Trust or (y) 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 all or any part of the  Trust or the  Owner  Trust
Estate or (z) otherwise  affect the rights,  obligations  and liabilities of the
parties hereto.

      (b) Except as provided in Section  8.01(a),  neither the Depositor nor any
Certificateholder shall be entitled to revoke or terminate the Trust.

      (c) Notice of any  termination  of the Trust,  specifying the Payment Date
upon  which   Certificateholders  shall  surrender  their  Certificates  to  the
Certificate Paying Agent for payment of the final distribution and cancellation,
shall be given by the Certificate  Paying Agent by letter to  Certificateholders
and the Credit  Enhancer  mailed  within  five (5)  Business  Days of receipt of
notice of such termination from the Owner Trustee,  stating (i) the Payment Date
upon or with respect to which final  payment of the  Certificates  shall be made
upon  presentation  and  surrender  of the  Certificates  at the  office  of the
Certificate Paying Agent therein  designated,  (ii) the amount of any such final
payment and (iii) that the Record Date otherwise applicable to such Payment Date
is not applicable,  payments being made only upon  presentation and surrender of
the  Certificates  at  the  office  of  the  Certificate  Paying  Agent  therein
specified.  The  Certificate  Paying  Agent  shall give such notice to the Owner
Trustee  and the  Certificate  Registrar  at the time  such  notice  is given to
Certificateholders.  Upon  presentation and surrender of the  Certificates,  the
Certificate  Paying Agent shall cause to be  distributed  to  Certificateholders
amounts distributable on such Payment Date pursuant to Section 5.01.

      In the event that all of the Certificateholders  shall not surrender their
Certificates for cancellation  within six months after the date specified in the
above mentioned written notice, the Certificate Paying 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.  Subject to applicable laws with respect to escheat of funds, if within
one year  following the Payment Date on which final payment of the  Certificates
was to have been made pursuant to Section 3.10, all the  Certificates  shall not
have been surrendered for  cancellation,  the Certificate  Paying Agent may take
appropriate steps, or may appoint an 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  that  shall
remain subject to this Trust  Agreement.  Any funds remaining in the Certificate
Distribution Account after exhaustion of

                                      -21-
<PAGE>

such remedies shall be distributed by the Certificate Paying Agent to the holder
of the majority of the Certificate Percentage Interest of the Certificates.

      (d) Upon the  winding  up of the  Trust  and its  termination,  the  Owner
Trustee  shall  cause  the  Certificate  of Trust to be  cancelled  by  filing a
certificate of  cancellation  with the Secretary of State in accordance with the
provisions of Section 3810(c) of the Statutory Trust Statute.

                                   ARTICLE IX

             SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES

      Section  9.01.  Eligibility  Requirements  for  Owner  Trustee.  The Owner
Trustee shall at all times be a corporation satisfying the provisions of Section
3807(a) of the Statutory Trust Statute;  authorized 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  authorities;  and
having (or having a parent that has) long-term debt obligations with a rating of
at least A by  Moody's  and/or  Standard  & Poor's.  If such  corporation  shall
publish  reports  of  condition  at  least  annually  pursuant  to law or to the
requirements of the aforesaid  supervising or examining authority,  then for the
purpose of this Section,  the combined  capital and surplus of such  corporation
shall be deemed to be its combined  capital and surplus as set forth in its most
recent report of condition so  published.  In case at any time the Owner Trustee
shall cease to be eligible in  accordance  with the  provisions  of this Section
9.01,  the Owner  Trustee  shall resign  immediately  in the manner and with the
effect specified in Section 9.02.

      Section 9.02.  Replacement of Owner Trustee.  The Owner Trustee may at any
time resign and be discharged  from the trusts hereby created by giving 30 days'
prior written  notice  thereof to the Credit  Enhancer and the  Depositor.  Upon
receiving  such notice of  resignation,  the Indenture  Trustee  shall  promptly
appoint a  successor  Owner  Trustee  with the  written  consent  of the  Credit
Enhancer (so long as no Credit Enhancer Default has occurred and is continuing),
which consent shall not be  unreasonably  withheld,  by written  instrument,  in
duplicate,  one copy of which  instrument  shall be delivered  to the  resigning
Owner Trustee and one copy to the successor Owner Trustee. If no successor Owner
Trustee  shall have been so appointed and have  accepted  appointment  within 30
days after the giving of such notice of resignation, the resigning Owner Trustee
may  petition  any court of  competent  jurisdiction  for the  appointment  of a
successor Owner Trustee.

      If at any time the Owner  Trustee shall cease to be eligible in accordance
with the  provisions  of  Section  9.01 and shall fail to resign  after  written
request therefor by the Indenture  Trustee,  or if at any time the Owner Trustee
shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a
receiver of the Owner  Trustee or of its  property  shall be  appointed,  or any
public  officer  shall take  charge or  control  of the Owner  Trustee or of its
property  or  affairs  for  the  purpose  of  rehabilitation,   conservation  or
liquidation,  then the  Indenture  Trustee may with the  written  consent of the
Credit  Enhancer  (so long as no Credit  Enhancer  Default has  occurred  and is
continuing), which consent shall not be unreasonably withheld, and shall at the

                                      -22-
<PAGE>

written  direction  of the Credit  Enhancer,  remove the Owner  Trustee.  If the
Indenture  Trustee  shall remove the Owner  Trustee  under the  authority of the
immediately  preceding sentence,  the Indenture Trustee shall promptly appoint a
successor Owner Trustee acceptable to the Credit Enhancer by written instrument,
in duplicate,  one copy of which  instrument  shall be delivered to the outgoing
Owner Trustee so removed and one copy to the successor Owner Trustee,  and shall
pay all fees owed to the outgoing Owner Trustee.  Any  resignation or removal of
the Owner Trustee and appointment of a successor  Owner Trustee  pursuant to any
of the provisions of this Section shall not become effective until acceptance of
appointment by the successor Owner Trustee  pursuant to Section 9.03 and payment
of all fees and expenses owed to the outgoing Owner Trustee.

      Section  9.03.  Successor  Owner  Trustee.  Any  successor  Owner  Trustee
appointed pursuant to Section 9.02 shall execute, acknowledge and deliver to the
Indenture Trustee and to its predecessor  Owner Trustee an instrument  accepting
such appointment  under this Trust  Agreement,  and thereupon the resignation or
removal of the  predecessor  Owner  Trustee  shall  become  effective,  and such
successor  Owner  Trustee,  without any further act, deed or  conveyance,  shall
become fully vested with all the rights,  powers,  duties and obligations of its
predecessor under this Trust Agreement,  with like effect as if originally named
as Owner Trustee.  The predecessor  Owner Trustee shall upon payment of its fees
and expenses deliver to the successor Owner Trustee all documents and statements
and monies  held by it under this Trust  Agreement;  and the  predecessor  Owner
Trustee shall execute and deliver such  instruments  and do such other things as
may reasonably be required for fully and certainly vesting and confirming in the
successor Owner Trustee all such rights, powers, duties and obligations.

      No successor  Owner Trustee shall accept  appointment  as provided in this
Section 9.03 unless at the time of such  acceptance such successor Owner Trustee
shall be eligible pursuant to Section 9.01.

      Upon  acceptance of appointment by a successor  Owner Trustee  pursuant to
this  Section  9.03,  the  Indenture  Trustee  shall mail notice  thereof to all
Certificateholders,  the Noteholders and the Rating  Agencies.  If the Indenture
Trustee shall fail to mail such notice  within 10 days after  acceptance of such
appointment by the successor  Owner Trustee,  the successor  Owner Trustee shall
cause such notice to be mailed at the expense of the Issuer.

      Section 9.04.  Merger or Consolidation  of Owner Trustee.  Any Person into
which the Owner  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  Owner  Trustee  shall be a  party,  or any  Person
succeeding to all or  substantially  all of the corporate  trust business of the
Owner Trustee,  shall be the successor of the Owner Trustee  hereunder,  without
the execution or filing of any  instrument or any further act on the part of any
of  the  parties  hereto,  anything  herein  to  the  contrary  notwithstanding;
provided,  that such  Person  shall be eligible  pursuant  to Section  9.01 and,
provided,  further,  that the Owner  Trustee shall mail notice of such merger or
consolidation to the Rating Agencies.

      Section   9.05.   Appointment   of   Co-Trustee   or   Separate   Trustee.
Notwithstanding  any other provisions of this Trust Agreement,  at any time, for
the purpose of meeting any legal

                                      -23-
<PAGE>

requirements of any jurisdiction in which any part of the Owner Trust Estate may
at the time be located, the Owner Trustee shall have the power and shall execute
and deliver all instruments to appoint one or more Persons to act as co-trustee,
jointly with the Owner Trustee,  or as separate  trustee or trustees,  of all or
any  part of the  Owner  Trust  Estate,  and to vest  in  such  Person,  in such
capacity,  such title to the Trust or any part thereof and, subject to the other
provisions of this Section, such powers, duties, obligations,  rights and trusts
as the Owner  Trustee may consider  necessary or  desirable.  No  co-trustee  or
separate  trustee under this Trust Agreement shall be required to meet the terms
of  eligibility  as a successor  Owner  Trustee  pursuant to Section 9.01 and no
notice  of the  appointment  of any  co-trustee  or  separate  trustee  shall be
required pursuant to Section 9.03.

      Each separate  trustee and co-trustee  shall,  to the extent  permitted by
law, be appointed and act subject to the following provisions and conditions:

            (a) All rights,  powers, duties and obligations conferred or imposed
      upon the Owner Trustee shall be conferred  upon and exercised or performed
      by the Owner Trustee and such separate  trustee or co-trustee  jointly (it
      being   understood  that  such  separate  trustee  or  co-trustee  is  not
      authorized to act  separately  without the Owner  Trustee  joining in such
      act), except to the extent that under any law of any jurisdiction in which
      any particular act or acts are to be performed, the Owner 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  Owner  Trust  Estate  or any  portion  thereof  in any such
      jurisdiction)  shall be exercised  and  performed  singly by such separate
      trustee or co-trustee, but solely at the direction of the Owner Trustee;

            (b) No trustee under this Trust Agreement shall be personally liable
      by reason of any act or  omission  of any other  trustee  under this Trust
      Agreement;

            (c) The Owner Trustee may at any time accept the  resignation  of or
      remove any separate trustee or co-trustee; and

            (d) All  steps  have been  taken  prior to any such  appointment  to
      perfect any security interest granted pursuant to the Indenture.

      Any notice,  request or other  writing given to the Owner 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 Trust  Agreement  and the
conditions  of this  Article.  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 Owner
Trustee or separately, as may be provided therein, subject to all the provisions
of this Trust  Agreement,  specifically  including every provision of this Trust
Agreement  relating to the conduct of,  affecting the liability of, or affording
protection to, the Owner Trustee.  Each such instrument  shall be filed with the
Owner Trustee.

                                      -24-
<PAGE>

      Any  separate  trustee or  co-trustee  may at any time  appoint  the Owner
Trustee as 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
Trust  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 Owner  Trustee,  to the extent  permitted  by law,  without the
appointment of a new or successor co-trustee or separate trustee.

                                   ARTICLE X

                                  MISCELLANEOUS

      Section 10.01.  Amendments.  (a) This Trust  Agreement may be amended from
time to time by the parties hereto as specified in this Section 10.01,  provided
that any amendment, except as provided in subparagraph (e) below, be accompanied
by an Opinion of Counsel to the Owner Trustee to the effect that such  amendment
(i)  complies  with the  provisions  of this Section and (ii) will not cause the
Trust to be subject to an entity level tax.

      (b) If the purpose of the  amendment  (as detailed  therein) is to correct
any mistake,  eliminate any  inconsistency,  cure any ambiguity or deal with any
matter not covered (i.e., to give effect to the intent of the parties), it shall
not be  necessary to obtain the consent of any  Holders,  but the Owner  Trustee
shall be furnished with (A) a letter from the Rating Agencies that the amendment
will not result in the  downgrading or withdrawal of the rating then assigned to
any Security if determined without regard to the Credit  Enhancement  Instrument
and (B) an Opinion of Counsel to the effect that such action will not  adversely
affect in any material  respect the  interests of any Holders and the consent of
the Credit Enhancer (so long as no Credit  Enhancer  Default has occurred and is
continuing) shall be obtained.

      (c) If the purpose of the  amendment is to prevent the  imposition  of any
federal  or state  taxes at any time that any  Security  is  outstanding  (i.e.,
technical  in nature),  it shall not be  necessary  to obtain the consent of any
Holder, but the Owner Trustee shall be furnished with an Opinion of Counsel that
such  amendment is necessary or helpful to prevent the  imposition of such taxes
and is not  materially  adverse  to any  Holder  and the  consent  of the Credit
Enhancer (so long as no Credit Enhancer  Default has occurred and is continuing)
shall be obtained.

      (d) If the purpose of the  amendment  is to add or eliminate or change any
provision  of the Trust  Agreement  other  than as  contemplated  in (b) and (c)
above,  the amendment  shall require (A) the consent of the Credit  Enhancer (so
long as no Credit  Enhancer  Default  has  occurred  and is  continuing)  and an
Opinion of Counsel to the effect that such action will not  adversely  affect in
any  material  respect the  interests of any Holders and (B) either (a) a letter
from the Rating  Agencies that the amendment will not result in the  downgrading
or withdrawal of the rating then assigned to any Security if determined  without
regard to the Credit  Enhancement  Instrument  or (b) the  consent of Holders of
Certificates evidencing a majority of the Certificate Percentage Interest of the
Certificates  and  the  Indenture  Trustee;  provided,  however,  that  no  such
amendment shall (i) reduce in any manner the amount of, or delay the

                                      -25-
<PAGE>

timing  of,  payments  received  that  are  required  to be  distributed  on any
Certificate without the consent of the related  Certificateholder and the Credit
Enhancer, or (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 such Certificates then outstanding.

      (e) If the purpose of the  amendment  is to provide for the holding of any
of the  Certificates in book-entry form, it shall require the consent of Holders
of all such Certificates then outstanding; provided, that the Opinion of Counsel
specified in subparagraph (a) above shall not be required.

      (f) If the  purpose of the  amendment  is to provide  for the  issuance of
additional  certificates  representing an interest in the Trust, it shall not be
necessary to obtain the consent of any Holder,  but the Owner  Trustee  shall be
furnished with (A) an Opinion of Counsel to the effect that such action will not
adversely  affect in any material respect the interests of any Holders and (B) a
letter  from the  Rating  Agencies  that the  amendment  will not  result in the
downgrading  or  withdrawal  of the rating  then  assigned to any  Security,  if
determined without regard to the Credit  Enhancement  Instrument and the consent
of the Credit Enhancer (so long as no Credit  Enhancer  Default has occurred and
is continuing) shall be obtained.

      (g) Promptly  after the  execution of any such  amendment or consent,  the
Owner  Trustee  shall  furnish  written  notification  of the  substance of such
amendment  or consent to each  Certificateholder,  the  Indenture  Trustee,  the
Credit Enhancer and each of the Rating  Agencies.  It shall not be necessary for
the consent of  Certificateholders  or the  Indenture  Trustee  pursuant to this
Section  10.01 to approve  the  particular  form of any  proposed  amendment  or
consent,  but it shall be sufficient if such consent shall approve the substance
thereof.  The manner of  obtaining  such  consents  (and any other  consents  of
Certificateholders  provided  for in this Trust  Agreement or in any other Basic
Document)  and of  evidencing  the  authorization  of the  execution  thereof by
Certificateholders shall be subject to such reasonable requirements as the Owner
Trustee may prescribe.

      (h) In connection  with the execution of any amendment to any agreement to
which the Trust is a party,  other than this Trust Agreement,  the Owner Trustee
shall be entitled to receive and conclusively rely upon an Opinion of Counsel to
the effect that such  amendment is  authorized  or  permitted  by the  documents
subject  to such  amendment  and  that all  conditions  precedent  in the  Basic
Documents  for the  execution  and  delivery  thereof  by the Trust or the Owner
Trustee, as the case may be, have been satisfied.

      (i) Any amendment to this Trust Agreement affecting the rights, duties and
obligations of the Indenture Trustee,  Certificate  Registrar or the Certificate
Paying  Agent  shall be  consented  to by such party and such party  shall be an
addressee  on any Opinion of Counsel and receive any rating  letter  provided in
connection therewith.

      Promptly after the execution of any amendment to the Certificate of Trust,
the Owner Trustee shall cause the filing of such amendment with the Secretary of
State of the State of Delaware.

                                      -26-
<PAGE>

      Section   10.02.   No   Legal   Title   to   Owner   Trust   Estate.   The
Certificateholders  shall not have  legal  title to any part of the Owner  Trust
Estate. The  Certificateholders  shall be entitled to receive distributions with
respect to their undivided  beneficial  interest therein only in accordance with
Articles V and VIII.  No  transfer,  by operation  of law or  otherwise,  of any
right,  title or interest of the  Certificateholders  to and in their  ownership
interest  in the Owner  Trust  Estate  shall  operate  to  terminate  this Trust
Agreement or the trusts  hereunder or entitle any transferee to an accounting or
to the transfer to it of legal title to any part of the Owner Trust Estate.

      Section 10.03.  Limitations on Rights of Others.  Except for Section 2.07,
the  provisions of this Trust  Agreement are solely for the benefit of the Owner
Trustee, the Depositor, the Certificateholders,  the Credit Enhancer and, to the
extent expressly provided herein, the Indenture Trustee and the Noteholders, and
nothing in this Trust  Agreement  (other than Section 2.07),  whether express or
implied,  shall be  construed to give to any other Person any legal or equitable
right,  remedy or claim in the Owner Trust Estate or under or in respect of this
Trust Agreement or any covenants, conditions or provisions contained herein.

      Section  10.04.  Notices.  (a) Unless  otherwise  expressly  specified  or
permitted  by the terms  hereof,  all  notices  shall be in writing and shall be
deemed   given  upon   receipt,   if  to  the  Owner   Trustee,   addressed   to
[_______________________],   [_______________________],   [Address],  Attention:
Corporate  Trust  Administration;  if to the  Indenture  Trustee,  addressed  to
[_____________________],  [Address], Attention: Structured Finance/RFMSII - Home
Loan Trust 20[__]-[__],  if to the Depositor,  addressed to Residential  Funding
Mortgage  Securities  II,  Inc.,  8400  Normandale  Lake  Boulevard,  Suite 250,
Minneapolis,   Minnesota  55437;  if  to  the  Credit  Enhancer,   addressed  to
[_______________________], [Address], Attention: Structured Finance Surveillance
(Home Loan Trust 20[__]-[__]);  if to the Rating Agencies,  addressed to Moody's
Investors  Service,  Inc., 99 Church Street, 4th Floor, New York, New York 10001
and Standard & Poor's,  55 Water Street - 41st Floor,  New York, New York 10041,
Attention:  Structured  Finance  Department - MBS or, as to each party,  at such
other address as shall be  designated by such party in a written  notice to each
other party.

      (b) Any notice  required or permitted  to be given to a  Certificateholder
shall be given by  first-class  mail,  postage  prepaid,  at the address of such
Holder as shown in the  Certificate  Register.  Any notice so mailed  within the
time prescribed in this Trust  Agreement shall be conclusively  presumed to have
been duly given, whether or not the Certificateholder receives such notice.

      (c) A copy of any notice delivered to the Owner Trustee or the Trust shall
also be delivered to the Depositor.

      Section 10.05. Severability. Any provision of this Trust Agreement that is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

                                      -27-
<PAGE>

      Section 10.06. Separate Counterparts. This Trust Agreement may be executed
by the parties hereto in separate  counterparts,  each of which when so executed
and delivered  shall be an original,  but all such  counterparts  shall together
constitute but one and the same instrument.

      Section 10.07.  Successors and Assigns. All  representations,  warranties,
covenants and  agreements  contained  herein shall be binding upon, and inure to
the benefit of, each of the Depositor,  the Owner Trustee and its successors and
each  Certificateholder  and its successors and permitted assigns, all as herein
provided and the Credit  Enhancer.  Any  request,  notice,  direction,  consent,
waiver  or other  instrument  or action by a  Certificateholder  shall  bind the
successors and assigns of such Certificateholder.

      Section 10.08. No Petition. The Owner Trustee, by entering into this Trust
Agreement  and  each  Certificateholder,  by  accepting  a  Certificate,  hereby
covenant  and  agree  that  they  will not at any  time  institute  against  the
Depositor or the Trust, or join in any institution  against the Depositor or the
Trust of, any  bankruptcy  proceedings  under any United States federal or state
bankruptcy or similar law in connection with any obligations with respect to the
Certificates, the Notes, this Trust Agreement or any of the Basic Documents.

      Section  10.09.  No  Recourse.   Each  Certificateholder  by  accepting  a
Certificate  acknowledges that such  Certificateholder's  Certificates represent
beneficial  interests  in the Trust only and do not  represent  interests  in or
obligations  of the  Depositor,  the Seller,  the Owner  Trustee,  the Indenture
Trustee or any Affiliate thereof and no recourse may be had against such parties
or their assets,  except as may be expressly set forth or  contemplated  in this
Trust Agreement, the Certificates or the Basic Documents.

      Section 10.10. Headings. The headings of the various Articles and Sections
herein are for  convenience  of reference only and shall not define or limit any
of the terms or provisions hereof.

      Section 10.11.  GOVERNING LAW. THIS TRUST  AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE  WITH THE LAWS OF THE STATE OF  DELAWARE,  WITHOUT  REFERENCE  TO ITS
CONFLICT OF LAW  PROVISIONS,  AND THE  OBLIGATIONS,  RIGHTS AND  REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

      Section 10.12.  Integration.  This Trust Agreement  constitutes the entire
agreement  among the parties hereto  pertaining to the subject matter hereof and
supersedes all prior agreements and understanding pertaining thereto.

      Section  10.13.   Rights  of  Credit   Enhancer  to  Exercise   Rights  of
Certificateholders.

      (a) By  accepting  its  Certificate,  each  Certificateholder  agrees that
unless a Credit  Enhancer  Default  exists,  the Credit  Enhancer shall have the
right  to  exercise  all  rights  of the  Certificateholders  under  this  Trust
Agreement without any further consent of the Certificateholders. Nothing in this
Section, however, shall alter or modify in any way, the fiduciary obligations of
the Owner Trustee to the Certificateholders pursuant to this Trust

                                      -28-
<PAGE>

Agreement, or create any fiduciary obligation of the Owner Trustee to the Credit
Enhancer.  The Credit  Enhancer is an express  third-party  beneficiary  to this
Agreement.

      (b) From and after  the date on which the Notes are no longer  outstanding
under the Indenture and no amounts are owed to the Credit  Enhancer  pursuant to
the terms of the Insurance Agreement, including but not limited to, amounts owed
to the Credit  Enhancer  in  respect  of draws  made on the  Credit  Enhancement
Instrument and for unpaid premiums,  the Credit Enhancer shall have no rights or
benefits  hereunder  and all  references  to the Credit  Enhancer  in this Trust
Agreement shall be disregarded.

                                   ARTICLE XI

                          COMPLIANCE WITH REGULATION AB

      Section 11.01.  Intent of the Parties;  Reasonableness.  The Depositor and
the Owner Trustee  acknowledge  and agree that the purpose of this Article XI is
to facilitate  compliance by the Depositor  with the provisions of Regulation AB
and related rules and  regulations of the  Commission.  The Depositor  shall not
exercise its right to request delivery of information or other performance under
these provisions other than in good faith, or for purposes other than compliance
with the Securities  Act, the Exchange Act and the rules and  regulations of the
Commission  under the  Securities  Act and the Exchange  Act. The Owner  Trustee
acknowledges  that  interpretations  of the  requirements  of  Regulation AB may
change  over  time,  whether  due  to  interpretive  guidance  provided  by  the
Commission or its staff,  consensus among  participants  in the  mortgage-backed
securities markets,  advice of counsel, or otherwise,  and agrees to comply with
reasonable  requests  made  by the  Depositor  in good  faith  for  delivery  of
information under these provisions on the basis of evolving  interpretations  of
Regulation  AB.  The  Owner  Trustee  shall  cooperate  in good  faith  with any
reasonable request by the Depositor for information  regarding the Owner Trustee
that is necessary or required, in the reasonable good faith determination of the
Depositor,  to permit the Depositor to comply with the  provisions of Regulation
AB.

      Section  11.02.  Additional  Representations  and  Warranties of the Owner
Trustee.

      (a) The Owner  Trustee  shall be deemed to  represent  and  warrant to the
Depositor  as of the  date  hereof  and on each  date on  which  information  is
provided to the Depositor under Sections 11.01,  11.02(b) or 11.03 that,  except
as disclosed in writing to the Depositor prior to such date: (i) it is not aware
and has not  received  notice  that any  default,  early  amortization  or other
performance  triggering  event  has  occurred  as to  any  other  Securitization
Transaction  due to any default of the Owner Trustee;  (ii) there are no aspects
of its  financial  condition  that could have a material  adverse  effect on the
performance by it of its trustee  obligations  under this Trust Agreement or any
other Securitization  Transaction as to which it is the trustee; (iii) there are
no  material  legal  or  governmental   proceedings  pending  (or  known  to  be
contemplated)  against it that would be material to Noteholders;  (iv) there are
no relationships or transactions (as described in Item 1119(b) of Regulation AB)
relating to the Owner  Trustee  with  respect to the  Depositor  or any sponsor,
issuing entity, servicer, trustee, originator, significant obligor,

                                      -29-
<PAGE>

enhancement or support provider or other material  transaction party (as each of
such terms are used in Regulation AB) relating to the Securitization Transaction
contemplated  by this Trust  Agreement,  as  identified  by the Depositor to the
Owner Trustee in writing as of the Closing Date (each,  a  "Transaction  Party")
that are outside the ordinary course of business or on terms other than would be
obtained in an arm's length  transaction  with an unrelated  third party,  apart
from the  Securitization  Transaction,  and that are material to the  investors'
understanding  of the Notes;  and (v) the Owner  Trustee is not an affiliate (as
contemplated  by Item 1119(a) of Regulation AB) of any  Transaction  Party.  The
Depositor  shall  notify the Owner  Trustee of any change in the  identity  of a
Transaction  Party after the Closing Date at least five (5) Business  Days prior
to January 31 of each calendar year.

      (b) If so requested by the  Depositor  on any date  following  the Closing
Date,  the Owner Trustee  shall,  within five (5) Business Days  following  such
request,  confirm in writing the accuracy of the  representations and warranties
set forth in paragraph  (a) of this Section or, if any such  representation  and
warranty  is not  accurate  as of the  date of such  confirmation,  provide  the
pertinent  facts,  in  writing,  to the  Depositor.  Any such  request  from the
Depositor  shall not be given more than once each calendar  quarter,  unless the
Depositor  shall have a reasonable  basis for questioning the accuracy of any of
the representations and warranties.

      Section 11.03. Information to Be Provided by the Owner Trustee.

      (a)  For so  long  as the  Notes  are  outstanding,  for  the  purpose  of
satisfying  the  Depositor's  reporting  obligation  under the Exchange Act with
respect to any class of Notes,  the Owner Trustee shall provide to the Depositor
a written description of (i) the commencement of, a material  development in or,
if applicable,  the  termination of, any and all legal  proceedings  against the
Owner  Trustee or any and all  proceedings  of which any  property  of the Owner
Trustee is the subject, that would be material to Noteholders; and (ii) any such
proceedings  known to be contemplated by governmental  authorities that would be
material to Noteholders.  The Owner Trustee shall also notify the Depositor,  in
writing,  as promptly  as  practicable  following  notice to or  discovery  by a
Responsible  Officer of the Owner Trustee of any material changes to proceedings
described in the preceding sentence. In addition, the Owner Trustee will furnish
to the  Depositor,  in writing,  the  necessary  disclosure  regarding the Owner
Trustee describing such proceedings  required to be disclosed under Item 1117 of
Regulation  AB, for  inclusion in reports filed by or on behalf of the Depositor
pursuant to the Exchange  Act.  The  Depositor  will allow the Owner  Trustee to
review any disclosure  relating to material litigation against the Owner Trustee
prior to filing such  disclosure with the Commission to the extent the Depositor
changes the information provided by the Owner Trustee. Any descriptions required
with respect to legal  proceedings,  as well as updates to  previously  provided
descriptions,  under this Section 11.03(a) shall be given no later than five (5)
Business Days prior to the  Determination  Date following the month in which the
relevant event occurs.

      (b)  For so  long  as the  Notes  are  outstanding,  for  the  purpose  of
satisfying  the  Depositor's  reporting  obligation  under the Exchange Act with
respect to any class of Notes, the Owner Trustee shall, no later than January 31
of each calendar year, (i) provide to the Depositor such  information  regarding
the Owner Trustee as is required for the purpose of compliance with Item 1119 of
Regulation AB; provided, however, the Owner Trustee shall not be required to

                                      -30-
<PAGE>

provide  such  information  in the  event  that  there has been no change to the
information previously provided by the Owner Trustee to the Depositor;  and (ii)
as promptly as  practicable  following  notice to or discovery by a  Responsible
Officer of the Owner Trustee of any changes to such information,  provide to the
Depositor, in writing, such updated information. Such information shall include,
at a minimum, a description of any affiliation between the Owner Trustee and any
of the following parties to the Securitization  Transaction contemplated by this
Trust  Agreement,  as such parties and their  affiliates  are  identified to the
Owner  Trustee  by  the  Depositor  in  connection  with  the  closing  of  each
Securitization  Transaction or, if there has been a change in any such party, as
such  party is  identified  by the  Depositor  in a written  notice to the Owner
Trustee at least  five (5)  Business  Days prior to January 31 of each  calendar
year:

                  (i) the sponsor;

                  (ii) any depositor;

                  (iii) the issuing entity;

                  (iv) any servicer;

                  (v) any other trustee;

                  (vi) any originator;

                  (vii) any significant obligor;

                  (viii) any enhancement or support provider; and

                  (ix) any other material party related to any Securitization
                  Transaction.

      In addition,  the Owner Trustee  shall  provide a  description  of whether
there  is,  and if so the  general  character  of,  any  business  relationship,
agreement,  arrangement,  transaction or understanding between the Owner Trustee
and any  above-listed  party that is entered into outside the ordinary course of
business  or is on terms  other  than  would  be  obtained  in an  arm's  length
transaction  with an  unrelated  third  party,  apart  from  the  Securitization
Transaction contemplated by this Trust Agreement,  that currently exists or that
existed  during  the  past  two  years  and that is  material  to an  investor's
understanding of the Notes.

      (c) As of the  related  Payment  Date with  respect to each Report on Form
10-D with respect to the Notes filed by or on behalf of the Depositor, and as of
March 15  preceding  the date each Report on Form 10-K with respect to the Notes
is filed,  the Owner  Trustee  shall be deemed to represent and warrant that any
information  previously  provided by the Owner  Trustee under this Article XI is
materially  correct and does not have any  material  omissions  unless the Owner
Trustee has provided an update to such information.

                                      -31-
<PAGE>

      Section 11.04. Indemnification; Remedies.

      (a) The Owner Trustee shall indemnify the Depositor, each affiliate of the
Depositor,  the Master Servicer and each affiliate of the Master  Servicer,  and
the respective present and former directors,  officers,  employees and agents of
each of the foregoing, and shall hold each of them harmless from and against any
claims, losses,  liabilities (including penalties),  actions,  suits, judgments,
demands,  damages, costs and expenses (including reasonable fees and expenses of
attorneys or, as necessary,  consultants  and auditors and  reasonable  costs of
investigations) that any of them may sustain arising out of or based upon:

            (i) (A) any untrue statement of a material fact contained or alleged
      to be  contained  in  any  information,  report,  certification  or  other
      material  provided  under  this  Article  XI by or on  behalf of the Owner
      Trustee  (collectively,  the  "Owner  Trustee  Information"),  or (B)  the
      omission or alleged  omission to state in the Owner Trustee  Information a
      material fact required to be stated in the Owner  Trustee  Information  or
      necessary  in order to make the  statements  therein,  in the light of the
      circumstances under which they were made, not misleading; or

            (ii) any failure by the Owner  Trustee to deliver  any  information,
      report,  certification  or other  material when and as required under this
      Article XI.

      (b) In the case of any failure of performance  described in clause (ii) of
Section 11.04(a),  the Owner Trustee shall (i) promptly  reimburse the Depositor
for all costs  reasonably  incurred  by the  Depositor  in order to  obtain  the
information,  report, certification or other material not delivered by the Owner
Trustee as required  and (ii)  cooperate  with the  Depositor  to  mitigate  any
damages that may result from such failure.

      (c) The  Depositor  and the  Master  Servicer  shall  indemnify  the Owner
Trustee,  each  affiliate of the Owner  Trustee and the  respective  present and
former directors, officers, employees and agents of the Owner Trustee, and shall
hold each of them  harmless  from and against any  losses,  damages,  penalties,
fines,  forfeitures,  legal fees and expenses and related costs, judgments,  and
any other costs,  fees and expenses that any of them may sustain  arising out of
or based upon (i) any untrue  statement of a material fact  contained or alleged
to be contained in any information  provided under this Trust Agreement by or on
behalf of the Depositor or the Master Servicer for inclusion in any report filed
with Commission under the Exchange Act (collectively, the "RFC Information"), or
(ii) the omission or alleged omission to state in the RFC Information a material
fact required to be stated in the RFC  Information or necessary in order to make
the statements  therein, in the light of the circumstances under which they were
made, not misleading.

      (d)  Notwithstanding  any provision in this Section 11.04 to the contrary,
the parties  agree that none of the Owner  Trustee,  the Depositor or the Master
Servicer shall be liable to the other for any  consequential or punitive damages
whatsoever,   whether  in  contract,   tort  (including  negligence  and  strict
liability), or any other legal or equitable principle;  provided,  however, that
such limitation  shall not be applicable with respect to third party claims made
against a party.

                            [SIGNATURE PAGE FOLLOWS]

                                      -32-
<PAGE>

      IN WITNESS WHEREOF,  the Depositor and the Owner 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.

                                        RESIDENTIAL FUNDING MORTGAGE
                                        SECURITIES II, INC.

                                        By:
                                           -------------------------------------
                                        Name:
                                        Title:

                                        [_______________________], not in its
                                        individual capacity but solely as Owner
                                        Trustee, except with respect to the
                                        representations and warranties contained
                                        in Sections 6.03 and 11.02 hereof,

                                        By:
                                           -------------------------------------
                                        Name:
                                        Title:
Acknowledged and Agreed:
[_____________________]
as Indenture Trustee, Certificate
Registrar and Certificate Paying Agent

By:
  -------------------------------------
Name:
Title:

Acknowledged and Agreed
solely with respect to Article XI:
RESIDENTIAL FUNDING COMPANY, LLC

By:
  -------------------------------------
Name:
Title:

<PAGE>

                                    EXHIBIT A

                      FORM OF HOME LOAN BACKED CERTIFICATE

      THIS CERTIFICATE (THE  "CERTIFICATE")  IS SUBORDINATED IN RIGHT OF PAYMENT
TO THE NOTES AS DESCRIBED IN THE AGREEMENT (AS DEFINED HEREIN).

      THIS  CERTIFICATE  IS NOT  TRANSFERABLE  EXCEPT UPON  SATISFACTION  OF THE
CONDITIONS IN SECTION 3.05 OF THE AGREEMENT.

      THIS  CERTIFICATE  HAS NOT  BEEN  AND WILL  NOT BE  REGISTERED  UNDER  THE
SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR  TRANSFERRED  UNLESS IT IS REGISTERED  PURSUANT TO SUCH ACT AND
LAWS  OR  IS  SOLD  OR  TRANSFERRED  IN  TRANSACTIONS   WHICH  ARE  EXEMPT  FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 3.05 OF THE AMENDED AND RESTATED TRUST
AGREEMENT ("THE AGREEMENT").

      NO TRANSFER OF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) MAY BE MADE TO
ANY PERSON,  UNLESS THE TRANSFEREE PROVIDES THE COMPANY,  THE OWNER TRUSTEE, THE
CERTIFICATE REGISTRAR AND THE MASTER SERVICER WITH EITHER (A) A CERTIFICATION IN
THE FORM OF EXHIBIT G TO THE  AGREEMENT OR (B) AN OPINION OF COUNSEL  ACCEPTABLE
TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY, THE OWNER TRUSTEE, THE
CERTIFICATE  REGISTRAR  AND THE MASTER  SERVICER TO THE EFFECT THAT THE PURCHASE
AND HOLDING OF THIS  CERTIFICATE IS PERMISSIBLE  UNDER  APPLICABLE LAW, WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF
THE EMPLOYEE  RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED  ("ERISA"),  OR
SECTION 4975 OF THE INTERNAL  REVENUE CODE OF 1986,  AS AMENDED (THE "CODE") (OR
COMPARABLE  PROVISIONS OF ANY  SUBSEQUENT  ENACTMENTS)  AND WILL NOT SUBJECT THE
COMPANY, THE OWNER TRUSTEE, THE CERTIFICATE  REGISTRAR OR THE MASTER SERVICER TO
ANY OBLIGATION OR LIABILITY  (INCLUDING  OBLIGATIONS AND 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  COMPANY,  THE OWNER
TRUSTEE, THE CERTIFICATE REGISTRAR OR THE MASTER SERVICER.

                                      A-1
<PAGE>

      THIS  CERTIFICATE  DOES NOT  REPRESENT AN INTEREST IN OR OBLIGATION OF THE
SELLER, THE COMPANY,  THE MASTER SERVICER,  THE INDENTURE TRUSTEE,  OR THE OWNER
TRUSTEE OR ANY OF THEIR RESPECTIVE  AFFILIATES,  EXCEPT AS EXPRESSLY PROVIDED IN
THE AGREEMENT OR THE BASIC DOCUMENTS.

                                      A-2
<PAGE>

--------------------------------- -------- -------------------------------------
Certificate No.  ____                      Assumed Final Payment Date:
                                           [____________ ___], 20[___]
--------------------------------- -------- -------------------------------------

--------------------------------- -------- -------------------------------------
Cut-off Date:                              Certificate Percentage Interest of
[____________ ___], 20[___]                this Certificate: 100%
--------------------------------- -------- -------------------------------------

--------------------------------- -------- -------------------------------------
Date of Amended and
Restated Trust Agreement:
[____________ ___], 20[___]
--------------------------------- -------- -------------------------------------

--------------------------------- -------- -------------------------------------
First Payment Date:
[____________ ___], 20[___]
--------------------------------- -------- -------------------------------------

                          HOME LOAN-BACKED CERTIFICATE
                               SERIES 20[__]-[__]

      Evidencing  a 100%  interest in the Trust  Estate,  the  property of which
consists  primarily of the Home Loans,  created by RESIDENTIAL  FUNDING MORTGAGE
SECURITIES II, INC.  (hereinafter  called the "Company," which term includes any
successor entity under the Agreement referred to below).

      This  Certificate  is payable  solely from the assets of the Trust Estate,
and does not represent an obligation of or interest in the Company,  the Seller,
the Master Servicer,  the Indenture  Trustee,  the Owner Trustee or any of their
affiliates.  This Certificate,  is not guaranteed or insured by any governmental
agency or  instrumentality  or by the Company,  the Seller, the Master Servicer,
the Indenture Trustee, the Owner Trustee or any of their affiliates. None of the
Company,  the Seller,  the Master  Servicer,  the Indenture  Trustee,  the Owner
Trustee 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  [name of  Holder]  is the  registered  owner of the
Certificate  Percentage  Interest evidenced by this Certificate (as set forth on
the face  hereof) in certain  distributions  with  respect to the Trust  Estate,
consisting  primarily of the Home Loans, created by Residential Funding Mortgage
Securities  II,  Inc.  The Trust (as defined  herein) was created  pursuant to a
Trust  Agreement,  dated as of  [___________  __],  20[__]  and an  Amended  and
Restated Trust Agreement,  dated as specified above (as amended and supplemented
from   time   to   time,    the    "Agreement")    between   the   Company   and
[_______________________],  as owner  trustee (the "Owner  Trustee,"  which term
includes any successor entity under the Agreement),  a summary of certain of the
pertinent provisions of which is set forth hereafter.  To the extent not defined
herein,  the  capitalized  terms used herein have the  meanings  assigned in the
Agreement.  This  Certificate  is issued  under  and is  subject  to the  terms,
provisions  and conditions of the  Agreement,  to which  Agreement the Holder of
this  Certificate by virtue of the  acceptance  hereof assents and by which such
Holder is bound.

                                      A-3
<PAGE>

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business  Day, the Business
Day immediately following (the "Payment Date"),  commencing on the first Payment
Date specified above, to the Person in whose name this Certificate is registered
at the close of  business on the last day (or if such last day is not a Business
Day,  the  Business  Day  immediately  preceding  such  last  day) of the  month
immediately  preceding the month of such distribution (the "Record Date"), in an
amount equal to the pro rata portion evidenced by this Certificate (based on the
Certificate  Percentage  Interest  stated on the face hereon) of the Certificate
Distribution Amount, if any, required to be distributed to Holder of Certificate
on such Payment Date. Distributions on this Certificate will be made as provided
in the  Agreement  by the  Certificate  Paying  Agent by wire  transfer or check
mailed to the  Certificateholder  of record in the Certificate  Register without
the  presentation or surrender of this Certificate or the making of any notation
hereon.

      Except as otherwise  provided in the  Agreement  and  notwithstanding  the
above, the final  distribution on this Certificate will be made after due notice
by the Certificate  Paying Agent of the pendency of such  distribution  and only
upon  presentation  and  surrender of this  Certificate  at the office or agency
maintained by the  Certificate  Registrar for that purpose in the City and State
of New York.

      No transfer  of this  Certificate  will be made  unless  such  transfer is
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.  In the  event  that  such a  transfer  is to be  made,  the
Certificate  Registrar  or the Company  shall  require  either (i) an opinion of
counsel acceptable to and in form and substance  satisfactory to the Certificate
Registrar  and  the  Company  that  such  transfer  is  exempt  (describing  the
applicable  exemption and the basis  therefor) from or is being made pursuant to
the registration  requirements of the Securities Act of 1933, as amended, and of
any applicable statute of any state or (ii) an investment letter executed by the
Transferee in the form described in the Agreement and which investment letter or
Opinion of Counsel shall not be at the expense of the Trust,  the Owner Trustee,
the Indenture  Trustee,  the  Certificate  Registrar or the Company.  The Holder
hereof  desiring  to effect  such  transfer  shall,  and does  hereby  agree to,
indemnify the Trust, the Owner Trustee,  the Company,  the Master Servicer,  the
Indenture  Trustee and the Certificate  Registrar 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.

      As  described  above,  no transfer of this  Certificate  (or any  interest
herein)  shall be made unless the  transferee  provides the  Company,  the Owner
Trustee,  the  Certificate  Registrar and the Master  Servicer with either (a) a
certification  in the  form of  Exhibit  G to the  Agreement  stating  that  the
transferee  is not an  employee  benefit  plan  or  other  plan  subject  to the
prohibited  transaction provisions of ERISA or Section 4975 of the Code (each, a
"Plan"),  or any Person  (including,  without  limitation,  an insurance company
investing its general  account,  an investment  manager,  a named fiduciary or a
trustee of any Plan) who is using "plan assets,"  within the meaning of the U.S.
Department of Labor regulation  promulgated at 29 C.F.R. Section 2510.3-101,  as
modified by Section  3(42) of ERISA,  of any Plan (each,  a "Plan  Investor") to
effect such acquisition,  or (b) an opinion of counsel acceptable to and in form
and substance  satisfactory to the Company,  the Owner Trustee,  the Certificate
Registrar and the Master Servicer to the effect that the purchase and holding of
this Certificate is permissible under applicable law, will not

                                      A-4
<PAGE>

constitute or result in a 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  Company,  the  Owner  Trustee,  the
Certificate  Registrar  and the Master  Servicer to any  obligation or liability
(including  obligations or liabilities  under ERISA or Section 4975 of the Code)
in addition to those undertaken in the Agreement, which opinion of counsel shall
not be an expense of the Company, the Owner Trustee,  the Certificate  Registrar
or the Master Servicer.

      In addition, no transfer of a Certificate shall be permitted,  and no such
transfer  shall be  registered  by the  Certificate  Registrar  or be  effective
hereunder, unless evidenced by an Opinion of Counsel which establishes that such
transfer or the  registration  of such transfer  would not cause the Trust to be
classified  as a  publicly  traded  partnership,  an  association  taxable  as a
corporation,  a corporation or a taxable  mortgage pool for federal and relevant
state income tax  purposes,  which Opinion of Counsel shall not be an expense of
the Certificate Registrar and shall be an expense of the proposed transferee. No
Opinion of Counsel will be required if such  transfer is made to a nominee of an
existing beneficial holder of a Certificate.

      This  Certificate  is  issued  pursuant  to a  duly  authorized  issue  of
Certificate  designated as Home Loan-Backed  Certificate of the Series specified
hereon.  All terms used in this  Certificate  which are defined in the Agreement
shall have the meanings assigned to them in the Agreement.

      The Certificateholder,  by its acceptance of this Certificate, agrees that
it will look  solely to the funds on  deposit  in the  Certificate  Distribution
Account  that have been  released  from the Lien of the  Indenture  for  payment
hereunder and that neither the Owner Trustee in its individual  capacity nor the
Company is personally  liable to the  Certificateholder  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.

      The Holder of this Certificate  acknowledges and agrees that its rights to
receive  distributions  in respect of this  Certificate are  subordinated to the
rights  of  the  Noteholders  as  described  in  the  Indenture,   dated  as  of
[___________ ___], 20[___] between Home Loan Trust 20[__]-[__] (the "Trust") and
[_____________________], as Indenture Trustee (the "Indenture").

      The  Certificateholder,  by its acceptance of this Certificate,  covenants
and agrees that such  Certificateholder  will not at any time institute  against
the Company, or join in any institution against the Company or the Trust of, any
bankruptcy, reorganization,  arrangement, insolvency or liquidation proceedings,
or other  proceedings  under any United  States  federal or state  bankruptcy or
similar law in connection with any obligations relating to the Certificate,  the
Notes, the Agreement or any of the Basic Documents.

      The Agreement permits the amendment  thereof as specified below,  provided
that any amendment be accompanied by the consent of the Credit Enhancer (so long
as no Credit Enhancer  Default has occurred and is continuing) and an Opinion of
Counsel to the Owner Trustee to the effect that such amendment complies with the
provisions  of the  Agreement  and will not cause the Trust to be  subject to an
entity  level tax. If the purpose of the  amendment  is to correct any  mistake,
eliminate any inconsistency, cure any ambiguity or deal with any matter not

                                      A-5
<PAGE>

covered,  it shall not be necessary to obtain the consent of any Holder, but the
Owner Trustee shall be furnished with a letter from the Rating Agencies that the
amendment  will not result in the  downgrading  or withdrawal of the rating then
assigned to any Security if determined  without regard to the Credit Enhancement
Instrument and the consent of the Credit Enhancer (so long as no Credit Enhancer
Default has occurred and is continuing) shall be obtained. If the purpose of the
amendment is to prevent the imposition of any federal or state taxes at any time
that any  Security  is  outstanding,  it shall not be  necessary  to obtain  the
consent of the Holder,  but the Owner Trustee shall be furnished with an Opinion
of Counsel that such amendment is necessary or helpful to prevent the imposition
of such taxes and is not materially adverse to the Holder and the consent of the
Credit  Enhancer  (so long as no Credit  Enhancer  Default has  occurred  and is
continuing)  shall be  obtained.  If the purpose of the  amendment  is to add or
eliminate or change any provision of the  Agreement,  other than as specified in
the preceding  two  sentences,  the  amendment  shall require the consent of the
Credit  Enhancer  (so long as no Credit  Enhancer  Default has  occurred  and is
continuing),  an Opinion of counsel  to the  effect  that such  action  will not
adversely affect in any material respect the interests of any Holders and either
(a) a letter from the Rating  Agencies that the amendment will not result in the
downgrading  or  withdrawal  of the rating  then  assigned to any  Security,  if
determined  without  regard  to the  Credit  Enhancement  Instrument  or (b) the
consent of the Certificateholder and the Indenture Trustee;  provided,  however,
that no such  amendment  shall (i)  reduce in any manner the amount of, or delay
the time of,  payments  received  that are  required  to be  distributed  on the
Certificate without the consent of the Certificateholder and the Credit Enhancer
(so long as no Credit Enhancer Default has occurred and is continuing),  or (ii)
reduce the aforesaid  percentage of the  Certificate  without the consent of the
Holder of the Certificate.

      As provided in the  Agreement and subject to certain  limitations  therein
set forth,  the transfer of this  Certificate is registerable in the Certificate
Register upon surrender of this  Certificate for registration of transfer at the
offices or  agencies of the  Certificate  Registrar  maintained  in the City and
State of New York,  accompanied  by a written  instrument  of  transfer  in form
satisfactory to the Certificate  Registrar duly executed by the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of authorized denominations evidencing the same Class and aggregate
Certificate Percentage Interest will be issued to the designated transferee. The
initial  Certificate  Registrar  appointed  under the Agreement is the Indenture
Trustee.

      The  Certificate  is  issuable  only in  minimum  denominations  of a 100%
Certificate Percentage Interest.

      The Certificate is intended to be a certificated  security under Article 8
of the UCC of the State of New York and under the  corresponding  provisions  of
the UCC of any other State that may be applicable.

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

                                      A-6
<PAGE>

      The Owner Trustee, the Certificate Paying Agent, the Certificate Registrar
and any  agent of the  Owner  Trustee,  the  Certificate  Paying  Agent,  or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered as the owner hereof for all purposes,  and none of the Owner Trustee,
the Certificate Paying Agent, the Certificate  Registrar or any such agent shall
be affected by any notice to the contrary.

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

      The obligations created by the Agreement in respect of the Certificate and
the Trust  created  thereby shall  terminate  upon the earliest of (i) the final
distribution  of all moneys or other property or proceeds of the Trust Estate in
accordance  with the terms of the Indenture and the Agreement,  (ii) the Payment
Date in  [_______________]  20[___] or (iii) the purchase by the Master Servicer
of all the Home Loans pursuant to Section 8.08(a) of the Servicing Agreement.

      Unless the certificate of  authentication  hereon shall have been executed
by an authorized  officer of the Owner Trustee,  or an  authenticating  agent by
manual  signature,  this Certificate  shall not be entitled to any benefit under
the Agreement or be valid for any purpose.

                                      A-7
<PAGE>

      IN WITNESS WHEREOF,  the Owner Trustee,  on behalf of the Trust and not in
its individual capacity, has caused this Certificate to be duly executed.

                                HOME LOAN TRUST 20[__]-[__]

                                by       [_______________________],
                                         not in its individual capacity but
                                         solely as Owner Trustee

                                Dated:  __________________________________
                                           Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

This is the Certificate referred to in the within mentioned Agreement.

[_______________________],
not in its individual capacity
but solely as Owner Trustee

By: ____________________________________
    Authorized Signatory

or  ____________________________________,
    as Authenticating Agent of the Trust

By: ____________________________________
    Authorized Signatory

                                      A-8
<PAGE>

                                   ASSIGNMENT

      FOR VALUE  RECEIVED the  undersigned  hereby sells,  assigns and transfers
unto

PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE

________________________________________________________________________________
(Please print or type name and address, including postal zip code, of assignee)

________________________________________________________________________________
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing

________________________________________________________________________________
to transfer said Certificate on the books of the Certificate Registrar, with
full power of substitution in the premises.

Dated:

                                        _________________________________*/
                                        Signature Guaranteed:

                                        ____________________*/

_____________

*/ NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.

                                      A-9
<PAGE>

                            DISTRIBUTION INSTRUCTIONS

      The assignee  should  include the  following  for the  information  of the
Certificate Paying Agent:

      Distribution shall be made by wire transfer in immediately available funds
to
________________________________________________________________________________
for the  account  of  ________________________________________,  account  number
______________, or, if mailed by check, to ______________.

      Applicable statements should be mailed to __________________.

                                       ______________________________
                                       Signature of assignee or agent
                                       (for authorization of wire transfer only)

                                      A-10
<PAGE>

                                    EXHIBIT B

                             TO THE TRUST AGREEMENT

                              CERTIFICATE OF TRUST

                                       OF

                           HOME LOAN TRUST 20[__]-[__]

      THIS Certificate of Trust of Home Loan Trust  20[__]-[__] (the "Trust") is
being  duly  executed  and filed on behalf of the Trust by the  undersigned,  as
trustee,  to form a statutory  trust under the Delaware  Statutory Trust Act (12
Del. C. ss. 3801 et seq.) (the "Act").

      1. Name.  The name of the statutory  trust formed by this  Certificate  of
Trust is Home Loan Trust 20[__]-[__].

      2. Delaware  Trustee.  The name and business address of the trustee of the
Trust  in  the  State  of  Delaware  are  ________________,  __________________,
______________, Delaware ___________.

      3.  Effective  Date.  This  Certificate  of Trust shall be effective  upon
filing.

      IN WITNESS WHEREOF,  the undersigned has duly executed this Certificate of
Trust in accordance with Section 3811(a)(1) of the Act.

                                        [NAME OF OWNER TRUSTEE],
                                        not in its individual capacity
                                        but solely as Owner Trustee

                                        By:
                                           -------------------------------------
                                        Name:
                                        Title:

                                      B-1
<PAGE>

                                    EXHIBIT C

                  [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 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  Securities  Act of 1933, as amended (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,
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
Owner Trustee and the  Depositor  (as defined in the Amended and Restated  Trust
Agreement (the  "Agreement"),  dated as of  [___________  ___],  20[___] between
Residential   Funding   Mortgage   Securities   II,  Inc.,   as  Depositor   and
[_______________________]  as Owner  Trustee  pursuant  to  Section  3.05 of the
Agreement and [_____________________], as indenture trustee, as follows:

            a. The Buyer understands that the Rule 144A Securities have not been
      registered under the 1933 Act or the securities laws of any state.

            b.  The  Buyer   considers   itself  a  substantial,   sophisticated
      institutional  investor  having such knowledge and experience in financial
      and business matters that it is capable of evaluating the merits and risks
      of investment in the Rule 144A Securities.

                                      C-1
<PAGE>

            c. The Buyer has been furnished with all  information  regarding the
      Rule 144A Securities that it has requested from the Seller,  the Indenture
      Trustee, the Owner Trustee or the Master 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 Rule144A  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  Rule144A  under the 1933 Act and has  completed  either of the
      forms of  certification to that effect attached hereto as Annex 1 or Annex
      2. The Buyer is aware  that the sale to it is being  made in  reliance  on
      Rule 144A.  The Buyer is acquiring  the Rule 144A  Securities  for its own
      account  or  the  accounts  of  other  qualified   institutional   buyers,
      understands  that such  Rule144A  Securities  may be  resold,  pledged  or
      transferred  only (i) to a person  reasonably  believed  to be a qualified
      institutional  buyer that purchases for its own account or for the account
      of a  qualified  institutional  buyer to whom  notice  is  given  that the
      resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
      pursuant to another exemption from registration under the 1933 Act.

            3. The Buyer represents that:

(i) either (a) or (b) is satisfied, as marked below:

            ____ a. The  Buyer is not an  employee  benefit  plan or other  plan
subject to the prohibited transaction provisions of ERISA or Section 4975 of the
Code  (each,  a  "Plan"),  or any  Person  (including,  without  limitation,  an
insurance company investing its general account,  an investment manager, a named
fiduciary  or a trustee  of any Plan) who is using  "plan  assets,"  within  the
meaning of the U.S.  Department  of Labor  regulation  promulgated  at 29 C.F.R.
Section 2510.3-101,  as modified by Section 3(42) of ERISA, of any Plan (each, a
"Plan Investor") to effect such acquisition; or

            ____ b. The Buyer will provide the Depositor, the Owner Trustee, the
Certificate  Registrar  and the  Master  Servicer  with an  opinion  of  counsel
acceptable to and in form and substance satisfactory to the Depositor, the Owner
Trustee,  the  Certificate  Registrar and the Master Servicer to the effect that
the purchase and holding of this  Certificate  is permissible  under  applicable
law, will not constitute or result in a non-exempt prohibited

                                      C-2
<PAGE>

transaction  under  Section  406 of  ERISA  or  Section  4975  of the  Code  (or
comparable  provisions of any subsequent  enactments),  and will not subject the
Depositor,  the Owner Trustee, the Certificate Registrar and the Master Servicer
to any obligation or liability (including obligations or liabilities under ERISA
or Section 4975 of the Code) in addition to those  undertaken in the  Agreement,
which  opinion of counsel  shall not be an expense of the  Depositor,  the Owner
Trustee, the Certificate Registrar or the Master Servicer; and

            4. This document may be executed in one or more  counterparts and by
the different  parties hereto on separate  counterparts,  each of which, when so
executed, shall be deemed to be an original; such counterparts,  together, shall
constitute one and the same document.

      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 Buyer

By:_____________________________            By:_________________________________
   Name:                                       Name:
   Title:                                      Title:

Taxpayer Identification:                     Taxpayer Identification:

No.  ___________________________            No.  _______________________________
Date:___________________________            Date:_______________________________

                                      C-3
<PAGE>

                                                                      ANNEX 1 TO
                                                                       EXHIBIT C

            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 statutory 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.

      ___   State or Local Plan. The Buyer is a plan  established and maintained
            by  a  State,   its  political   subdivisions,   or  any  agency  or
            instrumentality of the State or its political subdivisions,  for the
            benefit of its employees.

      ___   ERISA Plan. The Buyer is an employee benefit plan within the meaning
            of Title I of the Employee Retirement Income Security Act of 1974.

----------
(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.

                                      C-4
<PAGE>

      ___   Investment  Adviser.  The Buyer is an investment  adviser registered
            under the Investment Advisers Act of 1940.

      ___   SBIC. The Buyer is a Small Business  Investment  Company licensed by
            the U.S. Small Business  Administration  under Section 301(c) or (d)
            of the Small Business Investment Act of 1958.

      ___   Business  Development  Company.  The Buyer is a business development
            company as defined in Section 202(a)(22) of the Investment  Advisers
            Act of 1940.

      ___   Trust  Fund.  The Buyer is a trust fund  whose  trustee is a bank or
            trust  company  and whose  participants  are  exclusively  (a) plans
            established and maintained by a State,  its political  subdivisions,
            or any  agency  or  instrumentality  of the  State or its  political
            subdivisions,  for the  benefit of its  employees,  or (b)  employee
            benefit  plans  within  the  meaning  of  Title  I of  the  Employee
            Retirement Income Security Act of 1974, but is not a trust fund that
            includes as participants  individual  retirement accounts or H.R. 10
            plans.

      3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer,  (ii) securities that are part of an
unsold  allotment  to or  subscription  by the Buyer,  if the Buyer is a dealer,
(iii) bank deposit notes and certificates of deposit,  (iv) loan participations,
(v) repurchase  agreements,  (vi)  securities  owned but subject to a repurchase
agreement and (vii) currency, interest rate and commodity swaps.

      4. For purposes of determining  the aggregate  amount of securities  owned
and/or invested on a discretionary  basis by the Buyer,  the Buyer used the cost
of such  securities  to the  Buyer  and did not  include  any of the  securities
referred to in the preceding  paragraph.  Further, in determining such aggregate
amount,  the Buyer may have included  securities  owned by  subsidiaries  of the
Buyer,  but only if such  subsidiaries  are  consolidated  with the Buyer in its
financial  statements  prepared in accordance with generally accepted accounting
principles  and if the  investments of such  subsidiaries  are managed under the
Buyer's direction.  However, such securities were not included if the Buyer is a
majority-owned,  consolidated  subsidiary of another enterprise and the Buyer is
not itself a reporting company under the Securities Exchange Act of 1934.

      5.  The  Buyer  acknowledges  that  it is  familiar  with  Rule  144A  and
understands  that the  seller to it and other  parties  related to the Rule 144A
Securities are relying and will continue to rely on the  statements  made herein
because one or more sales to the Buyer may be in reliance on Rule 144A.

___      ___      Will the Buyer be purchasing the Rule 144A
Yes      No       Securities only for the Buyer's own account?

                                      C-5
<PAGE>

      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:
                                             -----------------------------------

                                      C-6
<PAGE>

                                                                      ANNEX 2 TO
                                                                       EXHIBIT C

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

              [For Buyers That Are Registered Investment Companies]

      The  undersigned  hereby  certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:

      1. As indicated below,  the undersigned is the President,  Chief Financial
Officer or Senior Vice  President  of the Buyer or, if the Buyer is a "qualified
institutional  buyer" as that term is defined in Rule 144A under the  Securities
Act of 1933  ("Rule  144A")  because  Buyer  is part of a Family  of  Investment
Companies (as defined below), is such an officer of the Adviser.

      2. In  connection  with  purchases  by Buyer,  the  Buyer is a  "qualified
institutional  buyer" as  defined in SEC Rule 144A  because  (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, and (ii)
as marked below, the Buyer alone, or the Buyer's Family of Investment Companies,
owned at least  $100,000,000 in securities  (other than the excluded  securities
referred to below) as of the end of the Buyer's  most recent  fiscal  year.  For
purposes  of  determining  the  amount of  securities  owned by the Buyer or the
Buyer's Family of Investment Companies, the cost of such securities was used.

      ____  The Buyer owned  $___________________  in securities (other than the
            excluded  securities referred to below) as of the end of the Buyer's
            most recent fiscal year (such amount being  calculated in accordance
            with Rule 144A).

      ____  The Buyer is part of a Family of Investment Companies which owned in
            the aggregate $______________ in securities (other than the excluded
            securities  referred  to  below) as of the end of the  Buyer's  most
            recent fiscal year (such amount being  calculated in accordance with
            Rule 144A).

      3. The term "Family of  Investment  Companies" as used herein means two or
more  registered  investment  companies  (or series  thereof) that have the same
investment  adviser or  investment  advisers that are  affiliated  (by virtue of
being majority owned  subsidiaries  of the same parent or because one investment
adviser is a majority owned subsidiary of the other).

      4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated  with the Buyer or are part of the Buyer's Family of
Investment Companies, (ii) bank deposit notes and certificates of deposit, (iii)
loan  participations,  (iv)  repurchase  agreements,  (v)  securities  owned but
subject to a repurchase agreement and (vi) currency, interest rate and commodity
swaps.

                                      C-7
<PAGE>

      5. The Buyer is familiar with Rule 144A and  understands  that each of the
parties to which this  certification  is made are relying  and will  continue to
rely on the  statements  made herein because one or more sales to the Buyer will
be in reliance on Rule 144A.  In addition,  the Buyer will only purchase for the
Buyer's own account.

      6.  The  undersigned  will  notify  each  of the  parties  to  which  this
certification is made of any changes in the information and conclusions  herein.
Until such notice,  the Buyer's purchase of Rule 144A Securities will constitute
a reaffirmation of this  certification by the undersigned as of the date of such
purchase.

______________________________
Print Name of Buyer

By: __________________________
    Name:
    Title:

IF AN ADVISER:

_____________________________
Print Name of Buyer

Date: _______________________

                                      C-8
<PAGE>

                                    EXHIBIT D

                     FORM OF INVESTOR REPRESENTATION LETTER

                                ___________, 20__

Residential Funding Mortgage Securities II, Inc.
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, Minnesota 55437

[Indenture Trustee]
[Address]
Attention: Structured Finance

            Re:   Home Loan-Backed Certificates
                  Series 20[__]-[__]

Ladies and Gentlemen:

      __________________   (the  "Purchaser")  intends  to  purchase  from  (the
"Seller")  a ___%  Certificate  Percentage  Interest of  Certificates  of Series
20[__]-[__]  (the  "Certificates"),  issued pursuant to the Amended and Restated
Trust Agreement (the "Trust Agreement"),  dated as of [___________ ___], 20[___]
between  Residential  Funding  Mortgage  Securities  II, Inc. as depositor  (the
"Company")   and   [_______________________],   as  owner  trustee  (the  "Owner
Trustee"), as acknowledged and agreed by [_____________________], as Certificate
Registrar.  All terms  used  herein  and not  otherwise  defined  shall have the
meanings  set forth in the Trust  Agreement.  The  Purchaser  hereby  certifies,
represents and warrants to, and covenants  with, the Company and the Certificate
Registrar that:

            1. The Purchaser understands that (a) the Certificates have not been
      and will not be registered or qualified  under the Securities Act of 1933,
      as amended (the "Act") or any state securities law, (b) the Company is not
      required to so register or qualify the Certificates,  (c) the Certificates
      may be resold only if registered and qualified  pursuant to the provisions
      of the Act or any  state  securities  law,  or if an  exemption  from such
      registration  and  qualification  is  available,  (d) the Trust  Agreement
      contains  restrictions  regarding the transfer of the Certificates and (e)
      the Certificates will bear a legend to the foregoing effect.

            2. The Purchaser is acquiring the  Certificates  for its own account
      for investment  only and not with a view to or for sale in connection with
      any  distribution  thereof in any manner that would violate the Act or any
      applicable state securities laws.

            3. The Purchaser is (a) a substantial,  sophisticated  institutional
      investor  having such  knowledge and  experience in financial and business
      matters, and, in particular, in such matters related to securities similar
      to the Certificates, such that it is

                                      D-1
<PAGE>

      capable  of  evaluating   the  merits  and  risks  of  investment  in  the
      Certificates,  (b) able to bear the economic  risks of such an  investment
      and (c) an  "accredited  investor"  within  the  meaning  of  Rule  501(a)
      promulgated pursuant to the Act.

            4. The Purchaser has been furnished with, and has had an opportunity
      to  review  (a)  [a  copy  of  the  Private  Placement  Memorandum,  dated
      ___________,  20__,  relating to the Certificates (b)] a copy of the Trust
      Agreement and [b] [c] such other information  concerning the Certificates,
      the Home Loans and the Company as has been requested by the Purchaser from
      the Company or the Seller and is relevant to the  Purchaser's  decision to
      purchase the  Certificates.  The Purchaser  has had any questions  arising
      from such review answered by the Company or the Seller to the satisfaction
      of the Purchaser. [If the Purchaser did not purchase the Certificates from
      the Seller in connection with the initial distribution of the Certificates
      and was  provided  with a copy of the Private  Placement  Memorandum  (the
      "Memorandum")  relating to the original sale (the "Original  Sale") of the
      Certificates  by  the  Company,  the  Purchaser   acknowledges  that  such
      Memorandum  was  provided to it by the  Seller,  that the  Memorandum  was
      prepared by the Company  solely for use in  connection  with the  Original
      Sale and the Company did not  participate  in or facilitate in any way the
      purchase of the  Certificates  by the Purchaser  from the Seller,  and the
      Purchaser  agrees  that it will look  solely to the  Seller and not to the
      Company with respect to any damage,  liability,  claim or expense  arising
      out of,  resulting  from or in connection  with (a) error or omission,  or
      alleged  error  or  omission,  contained  in the  Memorandum,  or (b)  any
      information,   development   or  event  arising  after  the  date  of  the
      Memorandum.]

            5. The  Purchaser has not and will not nor has it authorized or will
      it  authorize  any  person  to (a)  offer,  pledge,  sell,  dispose  of or
      otherwise transfer any Certificate, any interest in any Certificate or any
      other similar security to any person in any manner,  (b) solicit any offer
      to buy or to  accept  a  pledge,  disposition  of  other  transfer  of any
      Certificate, any interest in any Certificate or any other similar security
      from any person in any manner,  (c) otherwise  approach or negotiate  with
      respect to any  Certificate,  any interest in any Certificate or any other
      similar  security  with any  person in any  manner,  (d) make any  general
      solicitation by means of general advertising or in any other manner or (e)
      take any other  action,  that (as to any of (a) through  (e) above)  would
      constitute a  distribution  of any  Certificate  under the Act, that would
      render the  disposition of any Certificate a violation of Section 5 of the
      Act or any state  securities  law, or that would require  registration  or
      qualification  pursuant thereto.  The Purchaser will not sell or otherwise
      transfer any of the Certificates, except in compliance with the provisions
      of the Trust Agreement.

            6. The Purchaser represents:

(i) that either (a) or (b) is satisfied, as marked below:

      ____ a. The  Purchaser  is not an  employee  benefit  plan or  other  plan
subject to the prohibited transaction provisions of ERISA or Section 4975 of the
Code  (each,  a  "Plan"),  or any  Person  (including,  without  limitation,  an
insurance company investing its general account,

                                      D-2
<PAGE>

an investment  manager, a named fiduciary or a trustee of any Plan) who is using
"plan  assets,"  within the meaning of the U.S.  Department of Labor  regulation
promulgated  at 29 C.F.R.  Section  2510.3-101,  as modified by Section 3(42) of
ERISA, of any Plan (each, a "Plan Investor") to effect such acquisition; or

      ____ b. The Purchaser  will provide the Company,  the Owner  Trustee,  the
Certificate  Registrar  and the  Master  Servicer  with an  opinion  of  counsel
acceptable to and in form and substance  satisfactory to the Company,  the Owner
Trustee,  the  Certificate  Registrar and the Master Servicer to the effect that
the purchase and holding of this  Certificate  is permissible  under  applicable
law, will not constitute or result in a 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 Company, the Owner Trustee,
the Certificate Registrar and the Master Servicer to any obligation or liability
(including  obligations or liabilities  under ERISA or Section 4975 of the Code)
in addition to those undertaken in the Agreement, which opinion of counsel shall
not be an expense of the Company, the Owner Trustee,  the Certificate  Registrar
or the Master Servicer; and

            7. The Purchaser is acquiring the Certificate for its own behalf and
      is not  acting as agent or  custodian  for any  other  person or entity in
      connection with such acquisition;

                                      D-3
<PAGE>

      8. The Purchaser is not a non-United  States person for federal income tax
purposes.

                                        Very truly yours,

                                        __________________________

                                        By: ___________________________________
                                        Name:
                                        Title:

                                      D-4
<PAGE>

                                    EXHIBIT E

                    FORM OF TRANSFEROR REPRESENTATION LETTER

__________, 20__

Residential Funding Mortgage Securities II, Inc.
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, Minnesota  55437

[Indenture Trustee]
[Address]
Attention: Structured Finance

            Re:   Home Loan-Backed Certificates
                  Series 20[__]-[__]

Ladies and Gentlemen:

      ____________________  (the  "Purchaser")  intends  to  purchase  from (the
"Seller")  a ___%  Certificate  Percentage  Interest of  Certificates  of Series
20[__]-[__]  (the  "Certificates"),  issued pursuant to the Amended and Restated
Trust Agreement (the "Trust Agreement"),  dated as of [___________ ___], 20[___]
between  Residential  Funding  Mortgage  Securities  II, Inc. as depositor  (the
"Company")   and   [_______________________],   as  owner  trustee  (the  "Owner
Trustee"), as acknowledged and agreed by [_____________________], as Certificate
Registrar.  All terms  used  herein  and not  otherwise  defined  shall have the
meanings  set  forth  in the  Trust  Agreement.  The  Seller  hereby  certifies,
represents and warrants to, and covenants  with, the Company and the Certificate
Registrar that:

      Neither  the  Seller nor  anyone  acting on its  behalf  has (a)  offered,
pledged,  sold,  disposed  of or  otherwise  transferred  the  Certificate,  any
interest in the  Certificate or any other similar  security to any person in any
manner, (b) has solicited any offer to buy or to accept a pledge, disposition or
other transfer of the Certificate,  any interest in the Certificate or any other
similar security from any person in any manner, (c) has otherwise  approached or
negotiated with respect to the  Certificate,  any interest in the Certificate or
any other  similar  security  with any  person in any  manner,  (d) has made any
general  solicitation by means of general advertising or in any other manner, or
(e) has taken any other action,  that (as to any of (a) through (e) above) would
constitute a distribution of the  Certificates  under the Securities Act of 1933
(the "Act"), that would render the disposition of the Certificate a violation of
Section  5 of the  Act or any  state  securities  law,  or  that  would  require
registration or qualification  pursuant thereto. The Seller will not act, in any
manner set forth in the foregoing sentence with respect to the Certificate.  The
Seller has not and will not sell or otherwise  transfer any of the Certificates,
except in compliance with the provisions of the Trust Agreement.

                                        Very truly yours,

                                        ________________________________________
                                                      (Seller)

                                        By:_____________________________________
                                           Name:
                                           Title:

                                      E-1
<PAGE>

                                    EXHIBIT F

                        CERTIFICATE OF NON-FOREIGN STATUS

      This  Certificate  of  Non-Foreign  Status  ("certificate")  is  delivered
pursuant to Section 3.05 of the Amended and Restated Trust  Agreement,  dated as
of  [___________  ___],  20[___] (the "Trust  Agreement"),  between  Residential
Funding     Mortgage     Securities     II,    Inc.,     as    depositor     and
[_______________________],  as Owner Trustee, in connection with the acquisition
of, transfer to or possession by the  undersigned,  whether as beneficial  owner
(the  "Beneficial  Owner"),  or nominee on behalf of the Beneficial Owner of the
Residential   Home   Loan-Backed    Certificates,    Series   20[__]-[__]   (the
"Certificate").  Capitalized terms used but not defined in this certificate have
the respective meanings given them in the Trust Agreement.

      Each  holder must  complete  Part I, Part II (if the holder is a nominee),
and in all cases sign and otherwise complete Part III.

      In addition, each holder shall submit with the Certificate an IRS Form W-9
relating to such holder.

      To confirm to the Trust that the  provisions  of Sections 871, 881 or 1446
of  the  Internal   Revenue  Code  (relating  to  withholding   tax  on  foreign
shareholders  and partners) do not apply in respect of the  Certificate  held by
the undersigned, the undersigned hereby certifies:

Part I -          Complete Either A or B

      A.    Individual as Beneficial Owner

            1.    I am (The  Beneficial  Owner is) not a non-resident  alien for
                  purposes of U.S. income taxation;

            2.    My (The Beneficial Owner's) name and home address are:

                  _____________________________
                  _____________________________
                  _____________________________; and

            3.    My  (The  Beneficial  Owner's)  U.S.  taxpayer  identification
                  number (Social Security Number) is _______________.

      B.    Corporate, Partnership or Other Entity as Beneficial Owner

            1.    (Name of the Beneficial  Owner) is not a foreign  corporation,
                  foreign partnership, foreign trust or foreign estate (as those
                  terms are defined in the Code and Treasury Regulations;

            2.    The   Beneficial   Owner's   office   address   and  place  of
                  incorporation (if applicable) is ______________; and

                                      F-1
<PAGE>

            3.    The Beneficial Owner's U.S. employer  identification number is
                  ______________.

Part II -         Nominees

      If  the  undersigned  is  the  nominee  for  the  Beneficial   Owner,  the
undersigned  certifies  that this  certificate  has been made in  reliance  upon
information contained in:

                  _____ an IRS Form W-9

                  _____ a form such as this or substantially similar

provided to the  undersigned  by an appropriate  person and (i) the  undersigned
agrees to notify the Trust at least  thirty (30) days prior to the date that the
form  relied  upon  becomes  obsolete,  and (ii) in  connection  with  change in
Beneficial  Owners,  the  undersigned  agrees  to  submit a new  Certificate  of
Non-Foreign Status to the Trust promptly after such change.

Part III -        Declaration

         The undersigned, as the Beneficial Owner or a nominee thereof, agrees
to notify the Trust within sixty (60) days of the date that the Beneficial Owner
becomes a foreign person. The undersigned understands that this certificate may
be disclosed to the Internal Revenue Service by the Trust and any false
statement contained therein could be punishable by fines, imprisonment or both.

                                      F-2
<PAGE>

      Under  penalties  of  perjury,   I  declare  that  I  have  examined  this
certificate  and to the best of my knowledge and belief it is true,  correct and
complete and will further  declare that I will inform the Trust of any change in
the  information  provided above,  and, if applicable,  I further declare that I
have the authority* to sign this document.

________________________
Name

________________________
Title (if applicable)

________________________
Signature and Date

*NOTE:  If signed  pursuant to a power of attorney,  the power of attorney  must
accompany this certificate.

                                      F-3
<PAGE>

                                    EXHIBIT G

                       FORM OF ERISA REPRESENTATION LETTER

                               _____________, 20__

Residential Funding Mortgage Securities II, Inc.
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, Minnesota  55437

[_______________________]
[Address]

Residential Funding Company, LLC
8400 Normandale Lake Boulevard
Suite 600
Minneapolis, Minnesota  55437

[CERTIFICATE REGISTRAR]

            Re:   Residential Funding Mortgage Securities II, Inc.
                  Home Loan-Backed Certificates, Series 20[__]-[__]

Dear Sirs:

            __________________________________ (the "Transferee") intends to
acquire from _____________________ (the "Transferor") a ___% Certificate
Percentage Interest of Residential Mortgage Securities II, Inc. Home Loan-Backed
Certificates, Series 20[__]-[__] (the "Certificates"), issued pursuant to an
Amended and Restated Trust Agreement (the "Trust Agreement") dated [___________
___], 20[___] among Residential Funding Mortgage Securities II, Inc., as
depositor (the "Depositor") and [_______________________], as trustee (the
"Owner Trustee"). Capitalized terms used herein and not otherwise defined shall
have the meanings assigned thereto in the Trust Agreement.

            The Transferee hereby certifies, represents and warrants to, and
covenants with, the Depositor, the Owner Trustee, the Certificate Registrar and
the Master Servicer that:

            (1) The Transferee is not an employee benefit plan or other plan
      subject to the prohibited transaction provisions of ERISA or Section 4975
      of the Code (each, a "Plan"), or any Person (including, without
      limitation, an insurance company investing its general account, an
      investment manager, a named fiduciary or a trustee of any Plan) who is
      using "plan assets," within the meaning of the U.S. Department of Labor
      regulation promulgated at 29 C.F.R. Section 2510.3-101, as modified by
      Section 3(42) of ERISA, of any Plan (each, a "Plan Investor") to effect
      such acquisition; or

                                      G-1
<PAGE>

            (2) The Transferee has provided the Depositor, the Owner Trustee,
      the Certificate Registrar and the Master Servicer with an opinion of
      counsel acceptable to and in form and substance satisfactory to the
      Depositor, the Owner Trustee, the Certificate Registrar and the Master
      Servicer to the effect that the purchase and holding of this Certificate
      is permissible under applicable law, will not constitute or result in a
      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 Depositor, the Owner Trustee, the Certificate
      Registrar and the Master Servicer to any obligation or liability
      (including obligations or liabilities under ERISA or Section 4975 of the
      Code) in addition to those undertaken in the Agreement, which opinion of
      counsel shall not be an expense of the Depositor, the Owner Trustee, the
      Certificate Registrar or the Master Servicer.

            In addition, the Transferee hereby certifies, represents and
warrants to, and covenants with, the Depositor, the Owner Trustee, the
Certificate Registrar and the Master Servicer that the Transferee will not
transfer such Certificates to any transferee unless such transferee meets the
requirements set forth in either (1) or (2).

                                     Very truly yours,

                                     _________________________________________

                                     By:
                                     Name:
                                     Title:

                                      G-2EXHIBIT 4.4

                                FORM OF INDENTURE

                          HOME LOAN TRUST 200[_]-[___]

                                     ISSUER

                                       AND

                            [______________________]

                                INDENTURE TRUSTEE

                                    INDENTURE

                  DATED AS OF [__________________ ___], 20[___]

                   __________________________________________

                   HOME LOAN-BACKED NOTES, SERIES 200[_]-[___]

                                  _____________

<PAGE>

ARTICLE I             Definitions............................................  2

         Section 1.01.   Definitions.........................................  2

         Section 1.02.   Incorporation by Reference of Trust
                         Indenture Act.......................................  2

         Section 1.03.   Rules of Construction...............................  2

ARTICLE II            Original Issuance of Notes.............................  3

         Section 2.01.   Form................................................  3

         Section 2.02.   Execution, Authentication and Delivery..............  3

ARTICLE III           Covenants..............................................  4

         Section 3.01.   Collection of Payments with respect to the
                         Home Loans..........................................  4

         Section 3.02.   Maintenance of Office or Agency.....................  4

         Section 3.03.   Money for Payments To Be Held in Trust;
                         Paying Agent........................................  4

         Section 3.04.   Existence...........................................  5

         Section 3.05.   Payment of Principal and Interest; Defaulted
                         Interest...........................................   6

         Section 3.06.   Protection of Trust Estate..........................  8

         Section 3.07.   Opinions as to Trust Estate.........................  8

         Section 3.08.   Performance of Obligations; Servicing Agreement.....  9

         Section 3.09.   Negative Covenants..................................  9

         Section 3.10.   Annual Statement as to Compliance................... 10

         Section 3.11.   Recording of Assignments............................ 10

         Section 3.12.   Representations and Warranties Concerning
                         the Home Loans.......................................10

         Section 3.13.   Assignee of Record of the Home Loans................ 10

         Section 3.14.   Master Servicer as Agent and Bailee of the
                         Indenture Trustee................................... 11

         Section 3.15.   Investment Company Act.............................. 11

         Section 3.16.   Issuer May Consolidate, etc......................... 11

         Section 3.17.   Successor or Transferee............................. 13

         Section 3.18.   No Other Business................................... 13

         Section 3.19.   No Borrowing........................................ 13

         Section 3.20.   Guarantees, Loans, Advances and Other
                         Liabilities......................................... 13

         Section 3.21.   Capital Expenditures................................ 13

         Section 3.22.   Owner Trustee Not Liable for the Certificate
                         or Related Documents................................ 13

         Section 3.23.   Restricted Payments................................. 14

         Section 3.24.   Notice of Events of Default......................... 14

<PAGE>

         Section 3.25.   Further Instruments and Acts........................ 14

         Section 3.26.   Statements to Noteholders........................... 14

         Section 3.27.   Payments under the Credit Enhancement
                         Instrument.......................................... 14

         Section 3.28.   Reserved............................................ 15

         Section 3.29.   Determination of Class A-1 Note Rate................ 15

         Section 3.30.   Liquidation on Final Insured Payment Date........... 15

         Section 3.31.   No Recourse......................................... 15

         Section 3.32.   Additional UCC Representations and Warranties....... 15

ARTICLE IV            The Notes; Satisfaction and Discharge of
                      Indenture.............................................. 16

         Section 4.01.   The Notes........................................... 16

         Section 4.02.   Registration of and Limitations on Transfer and
                         Exchange of Notes; Appointment of Certificate
                         Registrar........................................... 16

         Section 4.03.   Mutilated, Destroyed, Lost or Stolen Notes.......... 18

         Section 4.04.   Persons Deemed Owners............................... 18

         Section 4.05.   Cancellation........................................ 18

         Section 4.06.   Book Entry Notes.................................... 19

         Section 4.07.   Notices to Depository............................... 20

         Section 4.08.   Definitive Notes.................................... 20

         Section 4.09.   Tax Treatment....................................... 20

         Section 4.10.   Satisfaction and Discharge of Indenture............. 20

         Section 4.11.   Application of Trust Money.......................... 22

         Section 4.12.   Subrogation and Cooperation......................... 22

         Section 4.13.   Repayment of Monies Held by Paying Agent............ 22

         Section 4.14.   Temporary Notes..................................... 23

ARTICLE V             Default and Remedies................................... 23

         Section 5.01.   Events of Default................................... 23

         Section 5.02.   Acceleration of Maturity; Rescission
                         and Annulment....................................... 23

         Section 5.03.   Collection of Indebtedness and Suits for
                         Enforcement by Indenture Trustee........ ........... 24

         Section 5.04.   Remedies; Priorities................................ 26

         Section 5.05.   Optional Preservation of the Trust Estate........... 28

         Section 5.06.   Limitation of Suits................................. 28

         Section 5.07.   Rights of Noteholders to Receive Principal
                         and Interest........................................ 29

<PAGE>

         Section 5.08.   Restoration of Rights and Remedies.................. 29

         Section 5.09.   Rights and Remedies Cumulative...................... 29

         Section 5.10.   Delay or Omission Not a Waiver...................... 29

         Section 5.11.   Control by the Credit Enhancer or the
                         Noteholders......................................... 29

         Section 5.12.   Waiver of Past Defaults............................. 30

         Section 5.13.   Undertaking for Costs............................... 30

         Section 5.14.   Waiver of Stay or Extension Laws.................... 31

         Section 5.15.   Sale of Trust Estate................................ 31

         Section 5.16.   Action on Notes..................................... 33

         Section 5.17.   Performance and Enforcement of Certain
                         Obligations......................................... 33

ARTICLE VI            The Indenture Trustee.................................. 34

         Section 6.01.   Duties of Indenture Trustee......................... 34

         Section 6.02.   Rights of Indenture Trustee......................... 35

         Section 6.03.   Individual Rights of Indenture Trustee.............. 35

         Section 6.04.   Indenture Trustee's Disclaimer...................... 35

         Section 6.05.   Notice of Event of Default.......................... 35

         Section 6.06.   Reports by Indenture Trustee to Holders............. 36

         Section 6.07.   Compensation and Indemnity.......................... 36

         Section 6.08.   Replacement of Indenture Trustee.................... 36

         Section 6.09.   Successor Indenture Trustee by Merger............... 37

         Section 6.10.   Appointment of Co-Indenture Trustee or Separate
                         Indenture Trustee................................... 37

         Section 6.11.   Eligibility; Disqualification....................... 38

         Section 6.12.   Preferential Collection of Claims Against Issuer.... 39

         Section 6.13.   Representations and Warranties...................... 39

         Section 6.14.   Directions to Indenture Trustee..................... 40

         Section 6.15.   Indenture Trustee May Own Securities................ 40

ARTICLE VII           Noteholders' Lists and Reports......................... 40

         Section 7.01.   Issuer to Furnish Indenture Trustee Names and
                         Addresses of Noteholders............................ 40

         Section 7.02.   Preservation of Information; Communications
                         to Noteholders...................................... 41

         Section 7.03.   Reports by Issuer................................... 41

         Section 7.04.   Reports by Indenture Trustee........................ 41

<PAGE>

         Section 7.05.   Exchange Act Reporting.............................. 41

ARTICLE VIII          Accounts, Disbursements and Releases................... 42

         Section 8.01.   Collection of Money................................. 42

         Section 8.02.   Trust Accounts...................................... 42

         Section 8.03.   Officer's Certificate............................... 43

         Section 8.04.   Termination Upon Payment to Noteholders............. 43

         Section 8.05.   Release of Trust Estate............................. 43

         Section 8.06.   Surrender of Notes Upon Final Payment............... 43

ARTICLE IX            Supplemental Indentures................................ 44

         Section 9.01.   Supplemental Indentures Without Consent
                         of Noteholders...................................... 44

         Section 9.02.   Supplemental Indentures With Consent
                         of Noteholders...................................... 45

         Section 9.03.   Execution of Supplemental Indentures................ 47

         Section 9.04.   Effect of Supplemental Indenture.................... 47

         Section 9.05.   Conformity with Trust Indenture Act................. 47

         Section 9.06.   Reference in Notes to Supplemental Indentures....... 48

ARTICLE X             Miscellaneous.......................................... 48

         Section 10.01.  Compliance Certificates and Opinions, etc........... 48

         Section 10.02.  Form of Documents Delivered to Indenture
                         Trustee............................................. 50

         Section 10.03.  Acts of Noteholders................................. 50

         Section 10.04.  Notices, etc., to Indenture Trustee, Issuer,
                         Credit Enhancer and Rating Agencies................. 51

         Section 10.05.  Notices to Noteholders; Waiver...................... 51

         Section 10.06.  Alternate Payment and Notice Provisions............. 52

         Section 10.07.  Conflict with Trust Indenture Act................... 52

         Section 10.08.  Effect of Headings.................................. 52

         Section 10.09.  Successors and Assigns.............................. 52

         Section 10.10.  Separability........................................ 53

         Section 10.11.  Benefits of Indenture............................... 53

         Section 10.12.  Legal Holidays...................................... 53

         Section 10.13.  GOVERNING LAW....................................... 53

         Section 10.14.  Counterparts........................................ 53

         Section 10.15.  Recording of Indenture.............................. 53

         Section 10.16.  Issuer Obligation................................... 53

<PAGE>

         Section 10.17.  No Petition......................................... 54

         Section 10.18.  Inspection.......................................... 54

Exhibit A             Form of Notes

<PAGE>

                 RECONCILIATION AND TIE BETWEEN TRUST INDENTURE
                      ACT OF 1939 AND INDENTURE PROVISIONS*

Trust Indenture
  Act Section                                         Indenture Section
---------------                                       -----------------
   310(a)(1).......................................           6.11
      (a)(2).......................................           6.11
      (a)(3).......................................           6.10
      (a)(4).......................................      Not Applicable
      (a)(5).......................................           6.11
      (b)..........................................           6.08, 6.11
      (c)..........................................      Not Applicable
   311(a)..........................................           6.12
      (b)..........................................           6.12
      (c)..........................................      Not Applicable
   312(a)..........................................           7.01, 7.02(a)
      (b)..........................................           7.02(b)
      (c)..........................................           7.02(c)
   313(a)..........................................           7.04
      (b)..........................................           7.04
      (c)..........................................           7.03(a)(iii), 7.04
      (d)..........................................           7.04
   314(a)..........................................           3.10, 7.03(a)
       (b).........................................           3.07
      (c)(1).......................................           8.05(c), 10.01(a)
      (c)(2).......................................           8.05(c), 10.01(a)
      (c)(3).......................................      Not Applicable
      (d)(1).......................................           8.05(c), 10.01(b)
      (d)(2).......................................           8.05(c), 10.01(b)
      (d)(3).......................................           8.05(c), 10.01(b)
      (e)..........................................          10.01(a)
   315(a)..........................................           6.01(b)
      (b)..........................................           6.05
      (c)..........................................           6.01(a)
      (d)..........................................           6.01(c)
      (d)(1).......................................           6.01(c)
      (d)(2).......................................           6.01(c)
      (d)(3).......................................           6.01(c)
      (e)..........................................           5.13
   316(a)(1)(A)....................................           5.11
   316(a)(1)(B)....................................           5.12
   316(a)(2).......................................      Not Applicable
   316(b)..........................................           5.07
   317(a)(1).......................................           5.04
   317(a)(2).......................................           5.03(d)
   317(b)..........................................           3.03(a)
   318(a)..........................................          10.07

----------
*     This reconciliation and tie shall not, for any purpose, be deemed to be
      part of the within indenture.

<PAGE>

      This is the  Indenture,  dated as of  [__________________  ___],  20[___],
between HOME LOAN TRUST 200[_]-[___], a Delaware statutory trust, as Issuer (the
"Issuer"),  and  [______________________],  as Indenture Trustee (the "Indenture
Trustee"),

                                WITNESSETH THAT:

      Each party hereto agrees as follows for the benefit of the other party and
for the  equal  and  ratable  benefit  of the  Holders  of the  Issuer's  Series
200[_]-[___] Home Loan-Backed Notes (the "Notes").

                                 GRANTING CLAUSE

      The Issuer and the Owner Trustee hereby Grant to the Indenture  Trustee at
the Closing Date, as trustee for the benefit of the Holders of the Notes, all of
the Issuer's and the Owner Trustee's right, title and interest in and to whether
now existing or hereafter  created (a) the Home Loans;  (b) all funds on deposit
from time to time in the Payment  Account and in all proceeds  thereof;  (c) all
property  securing  the  payment  or  performance  of the  Home  Loans  and  all
supporting  obligations  for the Home  Loans;  and (d) all  present  and  future
claims,  demands,  causes  and  choses in action in respect of any or all of the
foregoing  and all  payments  on or under,  and all  proceeds  of every kind and
nature whatsoever in respect of, any or all of the foregoing and all payments on
or under, and all proceeds of every kind and nature whatsoever in the conversion
thereof, voluntary or involuntary,  into cash or other liquid property, all cash
proceeds,  accounts, accounts receivable,  notes, drafts,  acceptances,  checks,
deposit  accounts,  rights to payment of any and every kind,  and other forms of
obligations  and  receivables,  instruments and other property which at any time
constitute  all  or  part  of or are  included  in  the  proceeds  of any of the
foregoing (collectively, the "Trust Estate" or the "Collateral").

      The foregoing Grant is made in trust to secure the payment of principal of
and interest on, and any other amounts  owing in respect of, the Notes,  equally
and ratably without prejudice, priority or distinction, and to secure compliance
with the provisions of this Indenture, all as provided in this Indenture.

      The foregoing  Grant shall inure to the benefit of the Credit  Enhancer in
respect of draws made on the Credit  Enhancement  Instrument  and amounts  owing
from time to time pursuant to the  Insurance  Agreement  (regardless  of whether
such  amounts  relate to the Notes or the  Certificates),  and such Grant  shall
continue in full force and effect for the benefit of the Credit  Enhancer  until
all such amounts owing to it have been repaid in full.

      The Indenture  Trustee,  as trustee on behalf of the Holders of the Notes:
(i)  acknowledges  such Grant,  (ii)  accepts the trust under this  Indenture in
accordance  with the  provisions  hereof,  (iii) agrees to perform its duties as
Indenture Trustee as required herein and (iv) acknowledges receipt of the Credit
Enhancement  Instrument  and shall hold such Credit  Enhancement  Instrument  in
accordance  with the terms of this  Indenture  for the benefit of the Holders of
the Notes.

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

      Section 1.01. Definitions.  For all purposes of this Indenture,  except as
otherwise  expressly  provided herein or unless the context otherwise  requires,
capitalized  terms not otherwise defined herein shall have the meanings assigned
to such  terms  in the  Definitions  attached  hereto  as  Appendix  A which  is
incorporated by reference herein.  All other capitalized terms used herein shall
have the meanings specified herein.

      Section 1.02.  Incorporation by Reference of Trust Indenture Act. Whenever
this Indenture refers to a provision of the Trust Indenture Act (the "TIA"), the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:

      "Commission" means the Securities and Exchange Commission.

      "indenture securities" means the Notes.

      "indenture security holder" means a Noteholder.

      "indenture to be qualified" means this Indenture.

      "indenture trustee" means the Indenture Trustee.

      "obligor"  on the  indenture  securities  means the  Issuer  and any other
obligor on the indenture securities.

      All other TIA terms used in this  Indenture  that are  defined by the TIA,
defined by TIA reference to another  statute or defined by Commission  rule have
the meaning assigned to them by such definitions.

      Section  1.03.  Rules  of  Construction.   Unless  the  context  otherwise
requires:

            (i) a term has the meaning assigned to it;

            (ii) an  accounting  term  not  otherwise  defined  has the  meaning
      assigned to it in accordance with generally accepted accounting principles
      as in effect from time to time;

            (iii) "or" is not exclusive;

            (iv) "including" means including without limitation;

            (v) words in the singular include the plural and words in the plural
      include the singular; and

            (vi) any  agreement,  instrument  or statute  defined or referred to
      herein  or in  any  instrument  or  certificate  delivered  in  connection
      herewith means such agreement,  instrument or statute as from time to time
      amended, modified or supplemented and

                                        2
<PAGE>

      includes (in the case of  agreements  or  instruments)  references  to all
      attachments thereto and instruments incorporated therein;  references to a
      Person are also to its permitted successors and assigns.

                                   ARTICLE II

                           ORIGINAL ISSUANCE OF NOTES

      Section 2.01.  Form.  The Notes,  together  with the  Indenture  Trustee's
certificate of  authentication,  shall be in substantially the form set forth in
Exhibit A, with such appropriate insertions, omissions,  substitutions and other
variations  as are  required or permitted  by this  Indenture  and may have such
letters,   numbers  or  other  marks  of  identification  and  such  legends  or
endorsements placed thereon as may, consistently  herewith, be determined by the
officers executing such Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.

      The Notes  shall be  typewritten,  printed,  lithographed  or  engraved or
produced by any  combination  of these methods  (with or without steel  engraved
borders),  all as determined by the Authorized Officers executing such Notes, as
evidenced by their execution of such Notes.  The terms of the Notes set forth in
Exhibit A are part of the terms of this Indenture.

      Section 2.02. Execution,  Authentication and Delivery.  The Notes shall be
executed  on  behalf  of the  Issuer  by any of  its  Authorized  Officers.  The
signature  of any  such  Authorized  Officer  on the  Notes  may  be  manual  or
facsimile.

      Notes bearing the manual or facsimile signature of individuals who were at
any  time   Authorized   Officers   of  the  Issuer   shall  bind  the   Issuer,
notwithstanding  that such  individuals  or any of them have ceased to hold such
offices prior to the  authentication  and delivery of such Notes or did not hold
such offices at the date of such Notes.

      The Indenture  Trustee shall upon Issuer Request  authenticate and deliver
Notes  for  original  issue  in  an  aggregate   initial   principal  amount  of
$[_____________]  with  respect  to the Class A-1 Notes,  $[_____________]  with
respect to the Class A-2 Notes,  $[_____________]  with respect to the Class A-3
Notes and $[_____________] with respect to the Class A-4 Notes.

      The Notes shall be dated the date of their authentication. The Notes shall
be  issuable  as  registered  Notes.  The Notes shall be issuable in the minimum
initial  Note  Balances of $100,000  and in integral  multiples  of $1 in excess
thereof.

      No Note shall be entitled to any benefit under this  Indenture or be valid
or obligatory  for any purpose,  unless there appears on such Note a certificate
of authentication  substantially in the form provided for herein executed by the
Indenture Trustee by the manual signature of one of its authorized  signatories,
and such  certificate upon any Note shall be conclusive  evidence,  and the only
evidence, that such Note has been duly authenticated and delivered hereunder.

                                        3
<PAGE>

                                   ARTICLE III

                                    COVENANTS

      Section 3.01.  Collection of Payments with respect to the Home Loans.  The
Indenture  Trustee shall  establish and maintain with itself the Payment Account
in which the Indenture  Trustee shall,  subject to the terms of this  paragraph,
deposit,  on the  same day as it is  received  from the  Master  Servicer,  each
remittance received by the Indenture Trustee with respect to the Home Loans. The
Payment  Account  shall be a  segregated  account and an Eligible  Account.  The
Indenture  Trustee  shall make all  payments of principal of and interest on the
Notes,  subject to Section  3.03, as provided in Section 3.05 herein from monies
on deposit in the Payment Account.

      Section 3.02. Maintenance of Office or Agency. The Issuer will maintain in
the City of New  York,  New York or St.  Paul,  Minnesota,  an  office or agency
where,  subject to  satisfaction  of conditions  set forth herein,  Notes may be
surrendered  for  registration  of transfer or exchange,  and where  notices and
demands to or upon the Issuer in respect of the Notes and this  Indenture may be
served.  The Issuer hereby initially  appoints the Indenture Trustee to serve as
its agent for the  foregoing  purposes.  If at any time the Issuer shall fail to
maintain  any such  office or  agency or shall  fail to  furnish  the  Indenture
Trustee with the address thereof,  such  surrenders,  notices and demands may be
made or served at the Corporate Trust Office, and the Issuer hereby appoints the
Indenture  Trustee  as its agent to receive  all such  surrenders,  notices  and
demands.

      Section 3.03. Money for Payments To Be Held in Trust; Paying Agent. (a) As
provided in Section  3.01,  all payments of amounts due and payable with respect
to any Notes that are to be made from amounts withdrawn from the Payment Account
pursuant to Section 3.01 shall be made on behalf of the Issuer by the  Indenture
Trustee or by the Paying  Agent,  and no amounts so  withdrawn  from the Payment
Account  for  payments  of Notes  shall be paid  over to the  Issuer  except  as
provided in this  Section  3.03.  The Issuer will cause each Paying  Agent other
than the Indenture  Trustee to execute and deliver to the  Indenture  Trustee an
instrument  in which such Paying  Agent shall agree with the  Indenture  Trustee
(and if the Indenture Trustee acts as Paying Agent it hereby so agrees), subject
to the provisions of this Section 3.03, that such Paying Agent will:

      (i) hold all sums held by it for the payment of amounts  due with  respect
to the Notes in trust for the benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise  disposed of as herein  provided
and pay such sums to such Persons as herein provided;

      (ii) give the Indenture  Trustee and the Credit Enhancer written notice of
any default by the Issuer of which it has actual  knowledge in the making of any
payment required to be made with respect to the Notes;

      (iii) at any time during the  continuance  of any such  default,  upon the
written request of the Indenture Trustee, forthwith pay to the Indenture Trustee
all sums so held in trust by such Paying Agent;

                                        4
<PAGE>

      (iv) immediately resign as Paying Agent and forthwith pay to the Indenture
Trustee  all sums held by it in trust for the payment of Notes if at any time it
ceases to meet the standards required to be met by a Paying Agent at the time of
its appointment;

      (v)  comply  with  all  requirements  of  the  Code  with  respect  to the
withholding  from  any  payments  made  by it on any  Notes  of  any  applicable
withholding  taxes imposed thereon and with respect to any applicable  reporting
requirements in connection therewith; and

      (vi) deliver to the Indenture  Trustee a copy of the report to Noteholders
prepared  with respect to each Payment Date by the Master  Servicer  pursuant to
Section 4.01 of the Servicing Agreement.

      The Issuer may at any time, for the purpose of obtaining the  satisfaction
and  discharge of this  Indenture or for any other  purpose,  by Issuer  Request
direct any Paying Agent to pay to the  Indenture  Trustee all sums held in trust
by such Paying  Agent,  such sums to be held by the  Indenture  Trustee upon the
same  trusts as those upon which the sums were held by such  Paying  Agent;  and
upon such  payment by any Paying  Agent to the  Indenture  Trustee,  such Paying
Agent shall be released from all further liability with respect to such money.

      Subject to  applicable  laws with  respect to escheat of funds,  any money
held by the  Indenture  Trustee or any Paying  Agent in trust for the payment of
any amount due with  respect to any Note and  remaining  unclaimed  for one year
after such amount has become due and payable shall be discharged from such trust
and be paid to the Issuer on Issuer  Request;  and the Holder of such Note shall
thereafter,  as an  unsecured  general  creditor,  look only to the  Issuer  for
payment  thereof  (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture  Trustee or such Paying Agent with respect to
such trust money shall thereupon cease;  provided,  however,  that the Indenture
Trustee or such Paying Agent,  before being required to make any such repayment,
shall at the expense and direction of the Issuer cause to be published  once, in
an  Authorized  Newspaper,  notice that such money  remains  unclaimed and that,
after a date  specified  therein,  which shall not be less than 30 days from the
date of such  publication,  any unclaimed  balance of such money then  remaining
will be repaid to the Issuer.  The Indenture  Trustee may also adopt and employ,
at the  expense  and  direction  of the Issuer,  any other  reasonable  means of
notification of such repayment (including, but not limited to, mailing notice of
such  repayment  to  Holders  whose  Notes  have been  called  but have not been
surrendered  for  redemption  or whose  right to or  interest  in monies due and
payable  but not  claimed is  determinable  from the  records  of the  Indenture
Trustee  or of any  Paying  Agent,  at the last  address of record for each such
Holder).

      Section  3.04.  Existence.  The  Issuer  will  keep  in  full  effect  its
existence,  rights and  franchises  as a  statutory  trust under the laws of the
State of Delaware  (unless it becomes,  or any successor  Issuer hereunder is or
becomes,  organized under the laws of any other state or of the United States of
America, in which case the Issuer will keep in full effect its existence, rights
and franchises  under the laws of such other  jurisdiction)  and will obtain and
preserve its  qualification  to do business in each  jurisdiction  in which such
qualification   is  or  shall  be   necessary   to  protect  the   validity  and
enforceability  of this  Indenture,  the  Notes,  the Home  Loans and each other
instrument or agreement included in the Trust Estate.

                                        5
<PAGE>

      Section 3.05. Payment of Principal and Interest;  Defaulted Interest.  (a)
On each Payment Date from amounts on deposit in the Payment Account,  the Paying
Agent shall pay to the  Noteholders,  the Certificate  Paying Agent on behalf of
the  Certificateholder  and to other  Persons  the  amounts  to  which  they are
entitled,  as set forth in the  statements  delivered to the  Indenture  Trustee
pursuant to Section 4.01 of the Servicing  Agreement,  as set forth below in the
following order of priority:

            (i) to the Credit Enhancer,  the Premium for the Credit  Enhancement
      Instrument,  plus any unpaid  Premium  from any prior  Payment  Date (with
      interest thereon as provided in the Insurance Agreement);

            (ii) to the  Noteholders,  Accrued  Note  Interest  for such Payment
      Date,  on a pro rata basis,  based on the amount of Accrued Note  Interest
      for such Payment  Date,  plus any Accrued Note Interest  remaining  unpaid
      from any prior Payment Date, less any Prepayment  Interest  Shortfalls and
      Relief Act  Shortfalls  allocated  thereto as provided in Section  3.05(d)
      below;

            (iii) to the  Noteholders  as principal on the Notes,  the Principal
      Collection Payment Amount for such Payment Date, in the order described in
      Section 3.05(f) below,  until the Note Balances  thereof have been reduced
      to zero;

            (iv) to the  Noteholders as principal on the Notes,  the Liquidation
      Loss  Payment  Amount for such  Payment  Date,  in the order  described in
      Section 3.05(f) below,  until the Note Balances  thereof have been reduced
      to zero;

            (v) to the Credit Enhancer,  to reimburse it for prior draws made on
      the Credit  Enhancement  Instrument  (with interest thereon as provided in
      the Insurance Agreement);

            (vi) to the  Noteholders  as  principal  on the Notes,  the  Reserve
      Increase  Amount for such Payment Date, in the order  described in Section
      3.05(f) below, until the Note Balances thereof have been reduced to zero;

            (vii) to the Credit  Enhancer,  any other amounts owed to the Credit
      Enhancer pursuant to the Insurance Agreement; and

            (viii) any remaining  amount to the  Certificate  Paying  Agent,  on
      behalf of the holders of the Certificates;

provided, however, in the event that on a Payment Date a Credit Enhancer Default
shall have  occurred  and be  continuing,  (a) no  payments  will be made to the
Credit Enhancer pursuant to clause (v) above until all Insured Payments that are
due and required to be paid by the Credit  Enhancer on the Notes on such Payment
Date or were due and  required  to be paid by the Credit  Enhancer  on any prior
Payment  Date have been paid in full and (b) any  amounts  payable to the Credit
Enhancer  pursuant to clause (v) shall instead be paid pursuant to clause (vii).
In  addition,  on the Final  Insured  Payment  Date or other final  Payment Date
(including the Payment Date following any purchase by the Master Servicer of the
Home Loans pursuant to Section 8.08 of the Servicing  Agreement),  the amount to
be paid  pursuant  to clause  (ii) above  shall be equal to the  aggregate  Note
Balance of the Notes immediately prior to such Payment Date.

                                        6
<PAGE>

      (b) On each Payment Date,  the  Certificate  Paying Agent shall deposit in
the Certificate  Distribution  Account all amounts it received  pursuant to this
Section   3.05   for  the   purpose   of   distributing   such   funds   to  the
Certificateholder.

      (c) The  amounts  paid to  Noteholders  shall  be  paid  to the  Notes  in
accordance with the applicable percentage as set forth in the definition of Note
Rate.  Interest will accrue on the Notes (other than the Class A-1 Notes) on the
basis of a 360-day year consisting of twelve 30-day months. Interest will accrue
on the Class A-1 Notes on the basis of a 360-day  year and the actual  number of
days in the related Interest Accrual Period.

      (d) To the extent the amount  available for interest  distributions on the
Notes is less than the aggregate amount of Accrued Note Interest on the Notes, a
draw on the Credit Enhancement Instrument will be made; provided,  however, that
to the extent such  shortfall is a result of Prepayment  Interest  Shortfalls or
Relief Act  Shortfalls,  whether related to the current  Collection  Period or a
prior  Collection  Period,  the  shortfall  will not be  covered  by the  Credit
Enhancement  Instrument,  and the  shortfall  will be allocated to the amount of
Accrued Note Interest on the Notes on a pro rata basis.

      (e) Any installment of interest or principal,  if any, payable on any Note
that is  punctually  paid or duly  provided for by the Issuer on the  applicable
Payment  Date shall,  if such Holder  holds Notes of an  aggregate  initial Note
Balance  of at  least  $1,000,000,  be paid  to each  Holder  of  record  on the
preceding  Record Date, by wire  transfer to an account  specified in writing by
such Holder reasonably satisfactory to the Indenture Trustee as of the preceding
Record Date or in all other cases or if no such instructions have been delivered
to the Indenture  Trustee,  by check or money order to such Noteholder mailed to
such Holder's  address as it appears in the Note Register the amount required to
be  paid  to such  Holder  on  such  Payment  Date  pursuant  to  such  Holder's
Securities;  provided, however, that the Indenture Trustee shall not pay to such
Holders any amount  required to be withheld from a payment to such Holder by the
Code.

      (f) Any payments to the Notes pursuant to clauses  3.05(a)(iii),  (iv) and
(vi) above plus amounts drawn on the Credit Enhancement Instrument in respect of
principal  shall be distributed to the Class A-1, Class A-2, Class A-3 and Class
A-4 Notes,  in that  order,  in each case  until the  outstanding  Note  Balance
thereof has been reduced to zero.

      (g) The Note  Balance of each Note shall be due and payable in full on the
Final Insured  Payment Date as provided in the form of Note set forth in Exhibit
A. All principal payments on the Notes shall be made to the Noteholders entitled
thereto in accordance with the Percentage  Interests  represented by such Notes.
Upon  written  notice to the  Indenture  Trustee by the Issuer (or by the Master
Servicer on behalf of the Issuer,  pursuant to Section  8.08(c) of the Servicing
Agreement)  of the  Final  Insured  Payment  Date for the  Notes or other  final
Payment Date,  the Indenture  Trustee  shall notify the related  Noteholders  of
record of the Final Insured Payment Date or other final Payment Date, by mail or
facsimile,  no later than five Business Days prior to the Final Insured  Payment
Date or other final Payment Date and shall specify:

                                       7
<PAGE>

            (i) that the Record Date  otherwise  applicable to such Payment Date
      is not applicable;

            (ii) that payment of the principal  amount and any interest due with
      respect  to such Note at the Final  Insured  Payment  Date or other  final
      Payment Date will be payable only upon  presentation and surrender of such
      Note and shall  specify  the place  where such Note may be  presented  and
      surrendered for such final payment; and

            (iii) the amount of any such final payment, if known.

      Section 3.06. Protection of Trust Estate. (a) The Issuer will from time to
time execute and deliver all such supplements and amendments hereto and all such
financing statements,  continuation statements, instruments of further assurance
and other  instruments,  and will take such other action  necessary or advisable
to:

            (i)  maintain or preserve the lien and  security  interest  (and the
      priority  thereof) of this  Indenture  or carry out more  effectively  the
      purposes hereof;

            (ii) perfect, publish notice of or protect the validity of any Grant
      made or to be made by this Indenture;

            (iii) cause the Trust to enforce any of the Home Loans; and

            (iv) preserve and defend title to the Trust Estate and the rights of
      the Indenture Trustee and the Noteholders in such Trust Estate against the
      claims of all persons and parties.

      (b) Except as otherwise provided in this Indenture,  the Indenture Trustee
shall not remove any portion of the Trust  Estate  that  consists of money or is
evidenced by an instrument,  certificate or other writing from the  jurisdiction
in which it was held at the date of the most recent Opinion of Counsel delivered
pursuant  to  Section  3.07 (or from  the  jurisdiction  in which it was held as
described in the Opinion of Counsel  delivered  at the Closing Date  pursuant to
Section  3.07(a),  if no Opinion of Counsel has yet been  delivered  pursuant to
Section  3.07(b))  unless the  Trustee  shall have first  received an Opinion of
Counsel  to the  effect  that the lien and  security  interest  created  by this
Indenture  with respect to such property  will  continue to be maintained  after
giving  effect to such  action or  actions.  The Issuer  hereby  designates  the
Indenture  Trustee  its agent and  attorney  in fact to  execute  any  financing
statement,  continuation  statement or other instrument  required to be executed
pursuant to this Section 3.06.

      Section 3.07.  Opinions as to Trust Estate.  (a) On the Closing Date,  the
Issuer shall furnish to the  Indenture  Trustee and the Owner Trustee an Opinion
of Counsel at the expense of the Issuer  either  stating that, in the opinion of
such  counsel,  such  action has been taken with  respect to the  recording  and
filing of this  Indenture,  any indentures  supplemental  hereto,  and any other
requisite  documents,  and with  respect  to the  execution  and  filing  of any
financing  statements and continuation  statements,  as are necessary to perfect
and make effective the lien and security interest in the Home Loans and reciting
the details of such action, or stating that, in the opinion of such counsel,  no
such action is necessary to make such lien and security interest effective.

                                       8
<PAGE>

      (b) On or before  December 31st in each calendar year,  beginning in 2007,
the Issuer shall  furnish to the  Indenture  Trustee and the Credit  Enhancer an
Opinion of Counsel at the  expense of the Issuer  either  stating  that,  in the
opinion  of such  counsel,  such  action  has been  taken  with  respect  to the
recording,  filing,  rerecording and refiling of this Indenture,  any indentures
supplemental  hereto and any other  requisite  documents and with respect to the
execution and filing of any financing statements and continuation  statements as
is necessary  to maintain  the lien and security  interest in the Home Loans and
reciting  the  details  of such  action or stating  that in the  opinion of such
counsel no such action is necessary to maintain such lien and security interest.
Such Opinion of Counsel shall also describe the recording,  filing, re recording
and refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and the execution and filing of any financing statements and
continuation  statements that will, in the opinion of such counsel,  be required
to maintain the lien and security  interest in the Home Loans until  December 31
in the following calendar year.

      Section 3.08.  Performance of Obligations;  Servicing  Agreement.  (a) The
Issuer will punctually perform and observe all of its obligations and agreements
contained in this  Indenture,  the Basic  Documents and in the  instruments  and
agreements included in the Trust Estate.

      (b) The Issuer may contract  with other Persons to assist it in performing
its duties under this Indenture,  and any performance of such duties by a Person
identified to the Indenture  Trustee in an Officer's  Certificate  of the Issuer
shall be deemed to be action taken by the Issuer.

      (c) The  Issuer  will not take any action or permit any action to be taken
by others which would release any Person from any of such Person's  covenants or
obligations  under any of the documents  relating to the Home Loans or under any
instrument included in the Trust Estate, or which would result in the amendment,
hypothecation,  subordination,  termination  or  discharge  of,  or  impair  the
validity or effectiveness of, any of the documents relating to the Home Loans or
any such  instrument,  except such  actions as the Master  Servicer is expressly
permitted to take in the Servicing Agreement.

      (d) The Issuer may retain an  administrator  and may enter into  contracts
with other Persons for the  performance of the Issuer's  obligations  hereunder,
and  performance  of such  obligations  by such  Persons  shall be  deemed to be
performance of such obligations by the Issuer.

      Section 3.09.  Negative  Covenants.  So long as any Notes are Outstanding,
the Issuer shall not:

            (i) except as expressly permitted by this Indenture, sell, transfer,
      exchange or otherwise  dispose of the Trust Estate,  unless directed to do
      so by the Indenture Trustee;

            (ii) claim any credit on, or make any  deduction  from the principal
      or interest  payable in respect of, the Notes (other than amounts properly
      withheld  from such  payments  under the Code) or assert any claim against
      any  present or former  Noteholder  by reason of the  payment of the taxes
      levied or assessed upon any part of the Trust Estate;

            (iii) (A) permit the validity or  effectiveness of this Indenture to
      be  impaired,  or  permit  the  lien  of  this  Indenture  to be  amended,
      hypothecated, subordinated, terminated

                                       9
<PAGE>

      or  discharged,  or permit any Person to be released from any covenants or
      obligations  with respect to the Notes under this Indenture  except as may
      be expressly  permitted hereby,  permit any lien, charge,  excise,  claim,
      security  interest,  mortgage or other encumbrance (other than the lien of
      this  Indenture) to be created on or extend to or otherwise  arise upon or
      burden the Trust Estate or any part thereof or any interest therein or the
      proceeds  thereof  or  (B)  permit  the  lien  of  this  Indenture  not to
      constitute a valid first priority  security  interest in the Trust Estate;
      or

            (iv) waive or impair, or fail to assert rights under the Home Loans,
      or impair or cause to be impaired the Home Loans or the Issuer's  interest
      in the Home  Loans,  the Home  Loan  Purchase  Agreement  or in any  Basic
      Document,  if any such action would  materially  and adversely  affect the
      interests of the Noteholders.

      Section 3.10.  Annual Statement as to Compliance.  The Issuer will deliver
to the Indenture Trustee and the Credit Enhancer,  within 120 days after the end
of each fiscal  year of the Issuer  (commencing  with the fiscal year 2007),  an
Officer's  Certificate  stating,  as to  the  Authorized  Officer  signing  such
Officer's Certificate, that:

            (i) a review of the activities of the Issuer during such year and of
      its performance under this Indenture and the Trust Agreement has been made
      under such Authorized Officer's supervision; and

            (ii) to the best of such Authorized  Officer's  knowledge,  based on
      such review,  the Issuer has complied  with all  conditions  and covenants
      under this Indenture and the provisions of the Trust Agreement  throughout
      such year, or, if there has been a default in its compliance with any such
      condition  or  covenant,  specifying  each  such  default  known  to  such
      Authorized Officer and the nature and status thereof.

      Section  3.11.  Recording of  Assignments.  The Issuer  shall  enforce the
obligation  of the Seller  under the Home Loan  Purchase  Agreement to submit or
cause to be submitted for recording all Assignments of Mortgages  within 60 days
of receipt of recording information by the Master Servicer.

      Section 3.12.  Representations  and Warranties  Concerning the Home Loans.
The  Indenture  Trustee,  as pledgee of the Home  Loans,  has the benefit of the
representations  and warranties made by the Seller in Section 3.1(a) and Section
3.1(b) of the Home Loan  Purchase  Agreement  concerning  the Home Loans and the
right to enforce the remedies against the Seller provided in such Section 3.1(a)
or  Section  3.1(b)  to the same  extent  as  though  such  representations  and
warranties were made directly to the Indenture Trustee.

      Section  3.13.  Assignee  of Record of the Home Loans.  The Issuer  hereby
directs and  authorizes  the Indenture  Trustee to hold record title to the Home
Loans by being  named as payee in the  endorsements  of the  Mortgage  Notes and
assignee in the  Assignments of Mortgage to be recorded under Section 2.1 of the
Home Loan  Purchase  Agreement.  Except as  expressly  provided in the Home Loan
Purchase  Agreement or in the Servicing  Agreement  with respect to any specific
Home Loan, the Indenture Trustee shall not execute any endorsement or assignment
or  otherwise  release or transfer  such  record  title to any of the Home Loans
until such time as the

                                       10
<PAGE>

remaining  Trust  Estate  may be  released  pursuant  to  Section  8.05(b).  The
Indenture  Trustee's  holding of such  record  title  shall in all  respects  be
subject to its fiduciary obligations to the Noteholders hereunder.

      Section  3.14.  Master  Servicer  as Agent  and  Bailee  of the  Indenture
Trustee.  Solely for purposes of  perfection  under Section 9-305 of the Uniform
Commercial Code or other similar applicable law, rule or regulation of the state
in which  such  property  is held by the  Master  Servicer,  the  Issuer and the
Indenture Trustee hereby acknowledge that the Master Servicer is acting as agent
and  bailee of the  Indenture  Trustee  in  holding  amounts  on  deposit in the
Custodial  Account pursuant to Section 3.02 of the Servicing  Agreement that are
allocable  to the Home  Loans,  as well as its agent and bailee in  holding  any
Related Documents released to the Master Servicer pursuant to Section 3.06(c) of
the Servicing  Agreement,  and any other items  constituting a part of the Trust
Estate which from time to time come into the possession of the Master  Servicer.
It is intended that, by the Master Servicer's acceptance of such agency pursuant
to Section 3.02 of the Servicing Agreement,  the Indenture Trustee, as a pledgee
of the Home Loans, will be deemed to have possession of such Related  Documents,
such  monies and such other items for  purposes of Section  9-305 of the Uniform
Commercial  Code of the  state  in which  such  property  is held by the  Master
Servicer.

      Section  3.15.  Investment  Company  Act.  The Issuer  shall not become an
"investment  company" or "controlled by" an investment company as such terms are
defined in the  Investment  Company Act of 1940, as amended (or any successor or
amendatory  statute),  and the rules and  regulations  thereunder  (taking  into
account not only the general  definition  of the term  "investment  company" but
also any available  exceptions to such general definition);  provided,  however,
that the Issuer shall be in  compliance  with this Section 3.15 if it shall have
obtained an order  exempting it from  regulation as an  "investment  company" so
long as it is in compliance with the conditions imposed in such order.

      Section  3.16.  Issuer May  Consolidate,  etc.  (a) The  Issuer  shall not
consolidate or merge with or into any other Person, unless:

            (i) the  Person (if other than the  Issuer)  formed by or  surviving
      such  consolidation  or merger  shall be a Person  organized  and existing
      under  the  laws of the  United  States  of  America  or any  state or the
      District  of  Columbia  and  shall  expressly   assume,  by  an  indenture
      supplemental  hereto,  executed and delivered to the Indenture Trustee, in
      form  reasonably  satisfactory  to the  Indenture  Trustee,  the  due  and
      punctual  payment of the principal of and interest on all Notes and to the
      Certificate  Paying  Agent,  on  behalf of the  Certificateholder  and the
      performance  or  observance  of  every  agreement  and  covenant  of  this
      Indenture on the part of the Issuer to be  performed  or observed,  all as
      provided herein;

            (ii) immediately after giving effect to such  transaction,  no Event
      of Default shall have occurred and be continuing;

            (iii) the Issuer receives consent of the Credit Enhancer (so long as
      no Credit  Enhancer  Default  exists) and the Rating  Agencies  shall have
      notified  the  Issuer  (with a copy to the  Indenture  Trustee)  that such
      transaction shall not cause the rating of the

                                       11
<PAGE>

      Notes, without regard to the Credit Enhancement Instrument, to be reduced,
      suspended or withdrawn or to be  considered  by either Rating Agency to be
      below investment grade without taking into account the Credit  Enhancement
      Instrument;

            (iv) the Issuer shall have received an Opinion of Counsel (and shall
      have  delivered  copies  thereof to the  Indenture  Trustee and the Credit
      Enhancer) to the effect that such  transaction  will not have any material
      adverse  tax   consequence   to  the  Issuer,   any   Noteholder   or  any
      Certificateholder;

            (v) any action that is  necessary  to maintain the lien and security
      interest created by this Indenture shall have been taken; and

            (vi) the Issuer  shall have  delivered to the  Indenture  Trustee an
      Officer's  Certificate  and an Opinion of Counsel  each  stating that such
      consolidation or merger and such  supplemental  indenture comply with this
      Article III and that all conditions precedent herein provided for relating
      to such transaction have been complied with (including any filing required
      by the Exchange Act).

      (b) The  Issuer  shall not convey or  transfer  any of its  properties  or
assets, including those included in the Trust Estate, to any Person, unless:

            (i)  the  Person  that   acquires  by  conveyance  or  transfer  the
      properties and assets of the Issuer the conveyance or transfer of which is
      hereby  restricted  shall  (A) be a  United  States  citizen  or a  Person
      organized  and existing  under the laws of the United States of America or
      any state,  (B) expressly  assume,  by an indenture  supplemental  hereto,
      executed and delivered to the Indenture  Trustee,  in form satisfactory to
      the Indenture  Trustee,  the due and punctual  payment of the principal of
      and  interest  on all Notes and the  performance  or  observance  of every
      agreement  and covenant of this  Indenture on the part of the Issuer to be
      performed or observed,  all as provided  herein,  (C)  expressly  agree by
      means of such supplemental indenture that all right, title and interest so
      conveyed or transferred  shall be subject and subordinate to the rights of
      Holders of the Notes, (D) unless otherwise  provided in such  supplemental
      indenture,  expressly  agree to  indemnify,  defend and hold  harmless the
      Issuer  against and from any loss,  liability or expense  arising under or
      related to this  Indenture and the Notes and (E) expressly  agree by means
      of such supplemental indenture that such Person (or if a group of Persons,
      then one specified Person) shall make all filings with the Commission (and
      any other  appropriate  Person) required by the Exchange Act in connection
      with the Notes;

            (ii) immediately after giving effect to such transaction, no Default
      or Event of Default shall have occurred and be continuing;

            (iii) the Issuer receives consent of the Credit Enhancer (so long as
      no Credit  Enhancer  Default  exists) and the Rating  Agencies  shall have
      notified  the  Issuer  (with a copy to the  Indenture  Trustee)  that such
      transaction shall not cause the rating of the Notes, without regard to the
      Credit Enhancement Instrument, to be reduced, suspended or withdrawn;

                                       12
<PAGE>

            (iv) the Issuer shall have received an Opinion of Counsel (and shall
      have  delivered  copies  thereof to the  Indenture  Trustee and the Credit
      Enhancer) to the effect that such  transaction  will not have any material
      adverse tax consequence to the Issuer or any Noteholder;

            (v) any action that is  necessary  to maintain the lien and security
      interest created by this Indenture shall have been taken; and

            (vi) the Issuer  shall have  delivered to the  Indenture  Trustee an
      Officer's  Certificate  and an Opinion of Counsel  each  stating that such
      conveyance or transfer and such  supplemental  indenture  comply with this
      Article III and that all conditions precedent herein provided for relating
      to such transaction have been complied with (including any filing required
      by the Exchange Act).

      Section  3.17.  Successor or  Transferee.  (a) Upon any  consolidation  or
merger of the Issuer in accordance with Section 3.16(a), the Person formed by or
surviving such  consolidation or merger (if other than the Issuer) shall succeed
to, and be  substituted  for,  and may  exercise  every  right and power of, the
Issuer  under this  Indenture  with the same  effect as if such  Person had been
named as the Issuer herein.

      (b) Upon a conveyance or transfer of all the assets and  properties of the
Issuer  pursuant to Section  3.16(b),  the Issuer  will be  released  from every
covenant and agreement of this Indenture to be observed or performed on the part
of the Issuer with respect to the Notes immediately upon the delivery of written
notice to the Indenture Trustee of such conveyance or transfer.

      Section  3.18.  No Other  Business.  The  Issuer  shall not  engage in any
business other than financing,  purchasing,  owning and selling and managing the
Home  Loans and the  issuance  of the Notes and the  Certificate  in the  manner
contemplated  by this  Indenture  and the  Basic  Documents  and all  activities
incidental thereto.

      Section  3.19. No Borrowing.  The Issuer shall not issue,  incur,  assume,
guarantee  or  otherwise  become  liable,   directly  or  indirectly,   for  any
indebtedness except for the Notes.

      Section 3.20. Guarantees, Loans, Advances and Other Liabilities. Except as
contemplated by this Indenture or the Basic Documents, the Issuer shall not make
any loan or advance or credit to, or guarantee  (directly or indirectly or by an
instrument having the effect of assuring another's payment or performance on any
obligation or capability of so doing or otherwise),  endorse or otherwise become
contingently liable, directly or indirectly, in connection with the obligations,
stocks or  dividends  of, or own,  purchase,  repurchase  or  acquire  (or agree
contingently to do so) any stock,  obligations,  assets or securities of, or any
other interest in, or make any capital contribution to, any other Person.

      Section  3.21.  Capital  Expenditures.  The  Issuer  shall  not  make  any
expenditure  (by long term or operating  lease or otherwise)  for capital assets
(either realty or personalty).

      Section  3.22.  Owner  Trustee Not Liable for the  Certificate  or Related
Documents. The recitals contained herein shall be taken as the statements of the
Depositor, and the Owner Trustee

                                       13
<PAGE>

assumes no responsibility for the correctness  thereof.  The Owner Trustee makes
no representations  as to the validity or sufficiency of this Indenture,  of any
Basic  Document or of the  Certificate  (other than the  signatures of the Owner
Trustee on the  Certificate)  or the Notes, or of any Related  Documents,  or of
MERS or the  MERS(R)  System.  The  Owner  Trustee  shall  at no time  have  any
responsibility  or liability with respect to the sufficiency of the Trust Estate
or  its  ability  to  generate   the   payments   to  be   distributed   to  the
Certificateholder  under the  Trust  Agreement  or the  Noteholders  under  this
Indenture,  including,  the  compliance  by the Depositor or the Seller with any
warranty  or  representation  made under any Basic  Document  or in any  related
document or the accuracy of any such warranty or  representation,  or any action
of the  Certificate  Paying Agent,  the  Certificate  Registrar or the Indenture
Trustee taken in the name of the Owner Trustee.

      Section  3.23.  Restricted  Payments.  The Issuer  shall not,  directly or
indirectly, (i) pay any dividend or make any payment (by reduction of capital or
otherwise),  whether in cash, property,  securities or a combination thereof, to
the  Owner  Trustee  or any  owner of a  beneficial  interest  in the  Issuer or
otherwise with respect to any ownership or equity  interest or security in or of
the Issuer,  (ii) redeem,  purchase,  retire or otherwise  acquire for value any
such  ownership  or equity  interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose;  provided,  however, that the Issuer
may  make,  or cause to be made,  (x)  payments  to the  Owner  Trustee  and the
Certificateholder  as contemplated by, and to the extent funds are available for
such purpose under the Trust Agreement,  and (y) payments to the Master Servicer
pursuant to the terms of the Servicing Agreement.  The Issuer will not, directly
or indirectly, make payments to or payments from the Custodial Account except in
accordance with this Indenture and the Basic Documents.

      Section  3.24.  Notice of Events of  Default.  The  Issuer  shall give the
Indenture  Trustee,  the Credit  Enhancer and the Rating Agencies prompt written
notice  of each  Event of  Default  hereunder  and any  default  under the Trust
Agreement.

      Section 3.25. Further  Instruments and Acts. Upon request of the Indenture
Trustee,  the Issuer will execute and deliver such  further  instruments  and do
such  further  acts as may be  reasonably  necessary or proper to carry out more
effectively the purpose of this Indenture.

      Section  3.26.  Statements  to  Noteholders.  On each  Payment  Date,  the
Indenture  Trustee and the  Certificate  Registrar shall forward by mail or make
available on its website initially located at "www.[_______________].com" to the
Credit Enhancer and each  Noteholder and  Certificateholder,  respectively,  the
statement   delivered  to  it,  on  the  Business  Day   following  the  related
Determination Date pursuant to Section 4.01 of the Servicing Agreement.

      Section 3.27. Payments under the Credit Enhancement Instrument.  (a) On or
prior to 12:00  noon New York City time on the  second  Business  Day before any
Payment Date,  including the Final Insured  Payment Date, the Indenture  Trustee
shall make a draw on the Credit  Enhancement  Instrument  in an amount,  if any,
equal to the Insured Payment.

      (b) The Indenture Trustee shall submit, if an Insured Payment is specified
in any Servicing Certificate prepared by the Master Servicer pursuant to Section
4.01 of the Servicing  Agreement,  the notice (in the form attached as Exhibit A
to the Credit Enhancement Instrument)

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<PAGE>

in the amount of the Insured  Payment to the Credit Enhancer no later than 12:00
noon New York City time,  on the  second  Business  Day prior to the  applicable
Payment Date.  Upon receipt of such Insured Payment in accordance with the terms
of the Credit Enhancement  Instrument,  the Indenture Trustee shall deposit such
Insured Payment in the Payment Account for distribution to Noteholders  pursuant
to Section 3.05.

      Section 3.28. Reserved.

      Section  3.29.  Determination  of Class A-1 Note Rate. On the second LIBOR
Business Day immediately preceding (i) the Closing Date in the case of the first
Interest  Accrual  Period  and (ii) the  first day of each  succeeding  Interest
Accrual  Period,  the Indenture  Trustee shall determine LIBOR and the Note Rate
for the Class A-1 Notes for such  Interest  Accrual  Period and shall inform the
Issuer,  the Master  Servicer,  the Credit  Enhancer and the  Depositor at their
respective  facsimile  numbers  given to the Indenture  Trustee in writing.  All
determinations  of LIBOR by the  Indenture  Trustee  shall,  in the  absence  of
manifest error,  be conclusive for all purposes,  and each holder of a Class A-1
Note, by accepting its Class A-1 Note, agrees to be bound by such determination.

      Section  3.30.  Liquidation  on Final  Insured  Payment Date. On the Final
Insured Payment Date, if the Notes are not paid in full on or prior to the Final
Insured  Payment  Date,  the  Indenture  Trustee  shall take full account of the
assets  and  liabilities  of  the  Trust,  shall  liquidate  the  assets,  in  a
commercially reasonable manner and on commercially reasonable terms, as promptly
as is consistent  with  obtaining the fair value thereof and in accordance  with
Section 5.15, and shall apply and distribute the proceeds therefrom in the order
of priority described in Section 3.05(c).

      Section  3.31.  No Recourse.  Upon the  occurrence  of an Event of Default
under the Notes,  this  Indenture or the other Basic  Documents,  Holders of the
Notes shall have recourse only to the  Collateral and all proceeds  thereof,  as
and to the extent provided herein,  and no recourse shall be had by such Holders
against the Issuer or its other assets or properties.

      Section 3.32.  Additional UCC Representations  and Warranties.  The Issuer
hereby represents and warrants that:

            (i) this Agreement creates a valid and continuing  security interest
      (as  defined in the  applicable  UCC) in the Trust  Estate in favor of the
      Indenture  Trustee on behalf of the Holders of the Notes,  which  security
      interest  is prior  to all  other  liens,  and is  enforceable  as such as
      against creditors of the Issuer.

            (ii) the Issuer owns and has good and marketable  title to the Trust
      Estate free and clear of any lien, claim or encumbrance of any Person.

            (iii) the Issuer will cause the filing of all appropriate  financing
      statements in the proper filing  office in the  appropriate  jurisdictions
      under  applicable  law  within  10 days of the  Closing  Date in  order to
      perfect the security interest in the Trust Estate granted to the Indenture
      Trustee on behalf of the Holders of the Notes.

            (iv)  other than the  security  interest  granted  to the  Indenture
      Trustee  on  behalf of the  Holders  of the  Notes  pursuant  to the Basic
      Documents, the Issuer has not pledged,

                                       15
<PAGE>

      assigned,  sold, granted a security interest in, or otherwise conveyed any
      of the Trust  Estate.  The Issuer is not aware of any judgment or tax lien
      filings against it. The Issuer has not authorized the filing of and is not
      aware of any  financing  statements  against  the  Issuer  that  include a
      description  of  collateral  covering  the  Trust  Estate  other  than any
      financing  statement  (i)  relating to the  security  interest  granted to
      Indenture  Trustee on behalf of the Holders of the Notes hereunder or (ii)
      that has been terminated.

      The  foregoing  representations  may not be waived and shall  survive  the
      issuance of the Notes.

                                   ARTICLE IV

               THE NOTES; SATISFACTION AND DISCHARGE OF INDENTURE

      Section  4.01.  The Notes.  The Notes shall be registered in the name of a
nominee  designated by the Depository.  Beneficial Owners will hold interests in
the Notes as set forth in Section 4.06 herein. The minimum initial Note Balances
with  respect to the Notes shall be $100,000  and  integral  multiples  of $1 in
excess thereof.

      The  Indenture  Trustee  may for all  purposes  (including  the  making of
payments  due  on  the  Notes)  deal  with  the  Depository  as  the  authorized
representative  of the  Beneficial  Owners  with  respect  to the  Notes for the
purposes  of  exercising  the rights of Holders  of Notes  hereunder.  Except as
provided in the next  succeeding  paragraph of this Section 4.01,  the rights of
Beneficial  Owners  with  respect  to  the  Notes  shall  be  limited  to  those
established  by law  and  agreements  between  such  Beneficial  Owners  and the
Depository  and  Depository  Participants.  Except as provided in Section  4.08,
Beneficial Owners shall not be entitled to definitive certificates for the Notes
as to which they are the Beneficial  Owners.  Requests and directions  from, and
votes of, the Depository as Holder of the Notes shall not be deemed inconsistent
if they are made with  respect to different  Beneficial  Owners.  The  Indenture
Trustee may establish a reasonable record date in connection with  solicitations
of consents from or voting by  Noteholders  and give notice to the Depository of
such record date.  Without the consent of the Issuer and the Indenture  Trustee,
no Note may be transferred by the  Depository  except to a successor  Depository
that agrees to hold such Note for the account of the Beneficial Owners.

      In the event  the  Depository  Trust  Company  resigns  or is  removed  as
Depository,  the Indenture Trustee with the approval of the Issuer may appoint a
successor  Depository.  If no successor  Depository has been appointed within 30
days of the effective  date of the  Depository's  resignation  or removal,  each
Beneficial  Owner shall be entitled to  certificates  representing  the Notes it
beneficially owns in the manner prescribed in Section 4.08.

      The Notes shall, on original issue, be executed on behalf of the Issuer by
the Owner Trustee,  not in its individual  capacity but solely as Owner Trustee,
authenticated by the Note Registrar and delivered by the Indenture Trustee to or
upon the order of the Issuer.

      Section 4.02.  Registration of and Limitations on Transfer and Exchange of
Notes;  Appointment of Certificate Registrar.  The Issuer shall cause to be kept
at the  Indenture  Trustee's  Corporate  Trust Office a Note  Register in which,
subject to such reasonable regulations as it may

                                       16
<PAGE>

prescribe, the Note Registrar shall provide for the registration of Notes and of
transfers and exchanges of Notes as herein provided.

      Subject  to  the  restrictions  and  limitations  set  forth  below,  upon
surrender  for  registration  of  transfer  of any Note at the  Corporate  Trust
Office,  the Issuer shall execute and the Note Registrar shall  authenticate and
deliver,  in the name of the designated  transferee or transferees,  one or more
new Notes in authorized  initial Note  Balances  evidencing  the same  aggregate
Percentage Interests.

      Subject to the foregoing,  at the option of the Noteholders,  Notes may be
exchanged  for other Notes of like tenor,  in  authorized  initial Note Balances
evidencing the same aggregate  Percentage  Interests upon surrender of the Notes
to be exchanged at the Corporate  Trust Office of the Note  Registrar.  Whenever
any Notes are so surrendered for exchange, the Issuer shall execute and the Note
Registrar shall  authenticate and deliver the Notes which the Noteholder  making
the  exchange is entitled to receive.  Each Note  presented or  surrendered  for
registration  of  transfer  or  exchange  shall  (if so  required  by  the  Note
Registrar) be duly  endorsed by, or be  accompanied  by a written  instrument of
transfer in form reasonably satisfactory to the Note Registrar duly executed by,
the  Holder  thereof  or his  attorney  duly  authorized  in  writing  with such
signature  guaranteed by a commercial  bank or trust company located or having a
correspondent  located in the city of New York.  Notes  delivered  upon any such
transfer or exchange will evidence the same obligations, and will be entitled to
the same rights and privileges, as the Notes surrendered.

      No service  charge  shall be imposed for any  registration  of transfer or
exchange  of  Notes,  but the Note  Registrar  shall  require  payment  of a sum
sufficient  to cover  any tax or  governmental  charge  that may be  imposed  in
connection with any registration of transfer or exchange of Notes.

      All Notes  surrendered for  registration of transfer and exchange shall be
cancelled  by the Note  Registrar  and  delivered to the  Indenture  Trustee for
subsequent destruction without liability on the part of either.

      The Issuer hereby appoints the Indenture Trustee as Certificate  Registrar
to keep at its Corporate Trust Office a Certificate Register pursuant to Section
3.09 of the Trust Agreement in which, subject to such reasonable  regulations as
it may prescribe,  the Certificate  Registrar shall provide for the registration
of the  Certificate and of transfers and exchanges  thereof  pursuant to Section
3.05  of  the  Trust  Agreement.  The  Indenture  Trustee  hereby  accepts  such
appointment.

      Each  purchaser and  transferee of a Note, by its  acceptance of the Note,
shall be deemed to have  represented  and  warranted  that  either (i) it is not
acquiring  the Note with the assets of an "employee  benefit plan" as defined in
Section 3(3) of ERISA, which is subject to the provisions of Title I of ERISA, a
"plan"  described in Section  4975(e)(1) of the Code, an entity whose underlying
assets  include "plan assets" by reason of an employee  benefit  plan's or other
plan's investment in such entity or any other plan that is subject to a law that
is  similar  to  Title  I of  ERISA  or  Section  4975 of the  Code or (ii)  the
acquisition  and  holding  of the  Note  will  not  give  rise  to a  non-exempt
prohibited  transaction under Section 406 of ERISA,  Section 4975 of the Code or
any similar applicable law.

                                       17
<PAGE>

      Section  4.03.  Mutilated,  Destroyed,  Lost or Stolen  Notes.  If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives  evidence to its satisfaction of the destruction,  loss or theft of any
Note,  and (ii) there is delivered  to the  Indenture  Trustee such  security or
indemnity as may be required by it to hold the Issuer and the Indenture  Trustee
harmless,  then, in the absence of notice to the Issuer,  the Note  Registrar or
the Indenture Trustee that such Note has been acquired by a bona fide purchaser,
and  provided  that the  requirements  of Section  8-405 of the UCC are met, the
Issuer  shall  execute,  and  upon  its  request  the  Indenture  Trustee  shall
authenticate  and  deliver,  in exchange  for or in lieu of any such  mutilated,
destroyed,  lost or stolen Note, a replacement Note; provided,  however, that if
any such destroyed,  lost or stolen Note, but not a mutilated  Note,  shall have
become or within  seven  days  shall be due and  payable,  instead  of issuing a
replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so
due or  payable  without  surrender  thereof.  If,  after the  delivery  of such
replacement Note or payment of a destroyed,  lost or stolen Note pursuant to the
proviso to the preceding sentence, a bona fide purchaser of the original Note in
lieu of which  such  replacement  Note was  issued  presents  for  payment  such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover
such replacement Note (or such payment) from the Person to whom it was delivered
or any  Person  taking  such  replacement  Note  from  such  Person to whom such
replacement  Note was  delivered or any  assignee of such Person,  except a bona
fide purchaser,  and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Indenture Trustee in connection therewith.

      Upon the issuance of any  replacement  Note under this Section  4.03,  the
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other  governmental  charge  that may be  imposed  in  relation
thereto and any other  reasonable  expenses  (including the fees and expenses of
the Indenture Trustee) connected therewith.

      Every replacement Note issued pursuant to this Section 4.03 in replacement
of any mutilated,  destroyed,  lost or stolen Note shall  constitute an original
additional  contractual  obligation of the Issuer, whether or not the mutilated,
destroyed,  lost or stolen Note shall be at any time enforceable by anyone,  and
shall  be  entitled  to  all  the  benefits  of  this   Indenture   equally  and
proportionately  with  any  and all  other  Notes  duly  issued  hereunder.  The
provisions of this Section 4.03 are exclusive and shall  preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Notes.

      Section  4.04.  Persons  Deemed  Owners.  Prior  to  due  presentment  for
registration  of transfer  of any Note,  the Issuer,  the Credit  Enhancer,  the
Indenture Trustee and any agent of the Issuer or the Indenture Trustee may treat
the Person in whose name any Note is registered (as of the day of determination)
as the owner of such Note for the purpose of receiving  payments of principal of
and  interest,  if any,  on such  Note and for all  other  purposes  whatsoever,
whether  or not  such  Note be  overdue,  and  none of the  Issuer,  the  Credit
Enhancer,  the  Indenture  Trustee or any agent of the  Issuer or the  Indenture
Trustee shall be affected by notice to the contrary.

      Section   4.05.   Cancellation.   All  Notes   surrendered   for  payment,
registration  of transfer,  exchange or redemption  shall, if surrendered to any
Person other than the Indenture  Trustee,  be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee.  The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously

                                       18
<PAGE>

authenticated and delivered  hereunder which the Issuer may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly cancelled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes  cancelled  as  provided in this  Section  4.05,  except as  expressly
permitted by this  Indenture.  All cancelled Notes may be held or disposed of by
the  Indenture  Trustee in  accordance  with its standard  retention or disposal
policy as in effect at the time  unless  the  Issuer  shall  direct by an Issuer
Request that they be destroyed or returned to it; provided,  however,  that such
Issuer Request is timely and the Notes have not been  previously  disposed of by
the Indenture Trustee.

      Section  4.06.  Book Entry Notes.  Each Class of Notes shall  initially be
issued as one or more Notes held by the Book Entry Custodian or, if appointed to
hold such Notes as provided  below,  the Depository  Trust Company,  the initial
Depository,  and  registered  in the name of its  nominee  Cede & Co.  Except as
provided  below,  registration  of  such  Notes  may not be  transferred  by the
Indenture  Trustee except to another  Depository  that agrees to hold such Notes
for the respective  Beneficial Owners. The Indenture Trustee is hereby initially
appointed  as the Book  Entry  Custodian  and  hereby  agrees  to act as such in
accordance  herewith and in accordance  with the agreement  that it has with the
Depository  authorizing it to act as such. The Book Entry Custodian may, and, if
it is no  longer  qualified  to act as such,  the Book  Entry  Custodian  shall,
appoint, by a written instrument delivered to the Depositor, the Master Servicer
and, if the  Indenture  Trustee is not the Book Entry  Custodian,  the Indenture
Trustee,  any other  transfer  agent  (including the Depository or any successor
Depository)  to act  as  Book  Entry  Custodian  under  such  conditions  as the
predecessor Book Entry Custodian and the Depository or any successor  Depository
may prescribe,  provided that the predecessor  Book Entry Custodian shall not be
relieved  of any  of  its  duties  or  responsibilities  by  reason  of any  new
appointment,  except  if the  Depository  is the  successor  to the  Book  Entry
Custodian. If the Indenture Trustee resigns or is removed in accordance with the
terms hereof,  the successor  trustee or, if it so elects,  the Depository shall
immediately  succeed to its  predecessor's  duties as Book Entry Custodian.  The
Depositor  shall have the right to inspect,  and to obtain  copies of, any Notes
held as Book Entry Notes by the Book Entry  Custodian.  No Beneficial Owner will
receive a Definitive Note representing such Beneficial  Owner's interest in such
Note,  except as provided in Section 4.08.  Unless and until  definitive,  fully
registered Notes (the "Definitive  Notes") have been issued to Beneficial Owners
pursuant to Section 4.08:

            (i) the  provisions  of this Section 4.06 shall be in full force and
      effect;

            (ii) the Note Registrar and the Indenture  Trustee shall be entitled
      to deal with the Depository for all purposes of this Indenture  (including
      the payment of  principal  of and  interest on the Notes and the giving of
      instructions or directions hereunder) as the sole holder of the Notes, and
      shall have no obligation to the Owners of Notes;

            (iii)  to the  extent  that  the  provisions  of this  Section  4.06
      conflict with any other  provisions of this  Indenture,  the provisions of
      this Section 4.06 shall control;

            (iv) the rights of Beneficial Owners shall be exercised only through
      the  Depository  and  shall be  limited  to those  established  by law and
      agreements  between  such  Owners of Notes and the  Depository  and/or the
      Depository  Participants.  Unless  and until  Definitive  Notes are issued
      pursuant to Section 4.08, the initial Depository will make

                                       19
<PAGE>

      book-entry  transfers  among the Depository  Participants  and receive and
      transmit  payments  of  principal  of and  interest  on the  Notes to such
      Depository Participants; and

            (v) whenever this Indenture  requires or permits actions to be taken
      based upon  instructions  or directions  of Holders of Notes  evidencing a
      specified  percentage  of the  aggregate  Note  Balance of the Notes,  the
      Depository shall be deemed to represent such percentage only to the extent
      that it has received  instructions to such effect from  Beneficial  Owners
      and/or Depository Participants owning or representing,  respectively, such
      required  percentage  of the  beneficial  interest  in the  Notes  and has
      delivered such instructions to the Indenture Trustee.

      Section  4.07.   Notices  to  Depository.   Whenever  a  notice  or  other
communication  to the Note Holders is required under this Indenture,  unless and
until Definitive  Notes shall have been issued to Beneficial  Owners pursuant to
Section  4.08,   the   Indenture   Trustee  shall  give  all  such  notices  and
communications  specified  herein  to be given to  Holders  of the  Notes to the
Depository, and shall have no obligation to the Beneficial Owners.

      Section 4.08.  Definitive Notes. If (i) the Indenture  Trustee  determines
that the  Depository  is no longer  willing or able to  properly  discharge  its
responsibilities  with respect to the Notes and the Indenture  Trustee is unable
to locate a qualified successor,  (ii) the Indenture Trustee elects to terminate
the book-entry system through the Depository or (iii) after the occurrence of an
Event of Default,  Owners of Notes representing beneficial interests aggregating
at least a  majority  of the  aggregate  Note  Balance  of the Notes  advise the
Depository in writing that the  continuation of a book-entry  system through the
Depository is no longer in the best interests of the Beneficial Owners, then the
Depository shall notify all Beneficial  Owners and the Indenture  Trustee of the
occurrence  of any such event and of the  availability  of  Definitive  Notes to
Beneficial  Owners  requesting the same. Upon surrender to the Indenture Trustee
of the  typewritten  Notes  representing  the Book Entry Notes by the Book Entry
Custodian  or  the  Depository,  as  applicable,   accompanied  by  registration
instructions,   the  Issuer  shall  execute  and  the  Indenture  Trustee  shall
authenticate  the Definitive  Notes in accordance  with the  instructions of the
Depository.  None of the Issuer,  the Note  Registrar or the  Indenture  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 Notes, the Indenture Trustee shall recognize the
Holders of the Definitive Notes as Noteholders.

      Section 4.09. Tax Treatment.  The Issuer has entered into this  Indenture,
and the Notes will be issued,  with the intention  that, for federal,  state and
local income, single business and franchise tax purposes, the Notes will qualify
as indebtedness of the Issuer. The Issuer, by entering into this Indenture,  and
each Noteholder, by its acceptance of its Note (and each Beneficial Owner by its
acceptance of an interest in the applicable Book Entry Note), agree to treat the
Notes for federal,  state and local  income,  single  business and franchise tax
purposes as indebtedness of the Issuer.

      Section 4.10.  Satisfaction  and Discharge of  Indenture.  This  Indenture
shall cease to be of further  effect with  respect to the Notes except as to (i)
rights of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.06, 3.09,

                                       20
<PAGE>

3.16, 3.17,  3.18, 3.19 and 3.20, (v) the rights,  obligations and immunities of
the Indenture Trustee  hereunder  (including the rights of the Indenture Trustee
under Section 6.07 and the  obligations  of the Indenture  Trustee under Section
4.11) and (vi) the rights of Noteholders as beneficiaries hereof with respect to
the property so deposited  with the Indenture  Trustee  payable to all or any of
them, and the Indenture Trustee,  on demand of and at the expense of the Issuer,
shall execute proper  instruments  acknowledging  satisfaction  and discharge of
this Indenture with respect to the Notes, when

      (A) either

            (1) the Notes  theretofore  authenticated  and delivered (other than
      (i)  Notes  that have been  destroyed,  lost or stolen  and that have been
      replaced  or paid as  provided  in  Section  4.03 and (ii) Notes for whose
      payment money has  theretofore  been  deposited in trust or segregated and
      held in trust  by the  Issuer  and  thereafter  repaid  to the  Issuer  or
      discharged  from such  trust,  as  provided  in  Section  3.03)  have been
      delivered to the Indenture Trustee for cancellation; or

            (2) the Notes not theretofore delivered to the Indenture Trustee for
      cancellation

                  a. have become due and payable,

                  b. will  become due and payable at the Final  Insured  Payment
            Date within one year, or

                  c. have been declared  immediately due and payable pursuant to
            Section 5.02.

      and the Issuer,  in the case of a. or b. above, has irrevocably  deposited
      or caused to be irrevocably  deposited with the Indenture  Trustee cash or
      direct  obligations of or  obligations  guaranteed by the United States of
      America (which will mature prior to the date such amounts are payable), in
      trust for such purpose,  in an amount  sufficient to pay and discharge the
      entire  indebtedness  on  such  Notes  then  outstanding  not  theretofore
      delivered to the Indenture  Trustee for cancellation when due on the Final
      Insured Payment Date;

      (B) the  Issuer  has paid or  caused  to be paid all  other  sums  payable
hereunder and under the Insurance Agreement by the Issuer; and

      (C) the Issuer  has  delivered  to the  Indenture  Trustee  and the Credit
Enhancer an Officer's  Certificate  and an Opinion of Counsel,  each meeting the
applicable  requirements  of Section 10.01 and each stating that all  conditions
precedent herein provided for relating to the satisfaction and discharge of this
Indenture  have been complied  with and, if the Opinion of Counsel  relates to a
deposit made in connection with Section  4.10(A)(2)b.  above, such opinion shall
further be to the effect that such deposit  will not have any  material  adverse
tax consequences to the Issuer, any Noteholders or any Certificateholder.

                                       21
<PAGE>

      Section 4.11.  Application of Trust Money.  All monies  deposited with the
Indenture  Trustee  pursuant to Section  4.10 hereof  shall be held in trust and
applied  by it,  in  accordance  with  the  provisions  of the  Notes  and  this
Indenture,  to the  payment,  either  directly  or through  any Paying  Agent or
Certificate Paying Agent, as the Indenture Trustee may determine, to the Holders
of  Securities,  of all sums due and to become due  thereon  for  principal  and
interest;  but such monies need not be segregated from other funds except to the
extent required herein or required by law.

      Section 4.12.  Subrogation and  Cooperation.  The Issuer and the Indenture
Trustee  acknowledge  that (i) to the extent the Credit  Enhancer makes payments
under the Credit  Enhancement  Instrument on account of principal of or interest
on the Home Loans, the Credit Enhancer will be fully subrogated to the rights of
the Noteholders to receive such principal and interest from the Home Loans,  and
(ii) the Credit Enhancer shall be paid such principal and interest but only from
the sources and in the manner provided herein and in the Insurance Agreement for
the payment of such principal and interest.

      The Indenture  Trustee shall cooperate in all respects with any reasonable
request by the Credit  Enhancer  for action to  preserve  or enforce  the Credit
Enhancer's  rights or interest under this Indenture or the Insurance  Agreement,
consistent  with  this  Indenture  and  without   limiting  the  rights  of  the
Noteholders  as  otherwise  set  forth  in  the  Indenture,  including,  without
limitation, upon the occurrence and continuance of a default under the Insurance
Agreement, a request to take any one or more of the following actions:

            (i)  institute  Proceedings  for the  collection of all amounts then
      payable on the Notes,  or under this Indenture in respect to the Notes and
      all  amounts  payable  under the  Insurance  Agreement  and to enforce any
      judgment obtained and collect from the Issuer monies adjudged due;

            (ii)  sell the  Trust  Estate or any  portion  thereof  or rights or
      interest  therein,  at one or more public or private  Sales (as defined in
      Section 5.15 hereof) called and conducted in any manner permitted by law;

            (iii) file or record all  assignments  that have not previously been
      recorded;

            (iv)  institute  Proceedings  from time to time for the  complete or
      partial foreclosure of this Indenture; and

            (v)  exercise  any  remedies  of a secured  party  under the Uniform
      Commercial  Code and take any  other  appropriate  action to  protect  and
      enforce the rights and remedies of the Credit Enhancer hereunder.

      Following  the  payment in full of the Notes,  the Credit  Enhancer  shall
continue to have all rights and privileges provided to it under this Section and
in all other provisions of this Indenture, until all amounts owing to the Credit
Enhancer have been paid in full.

      Section 4.13. Repayment of Monies Held by Paying Agent. In connection with
the  satisfaction and discharge of this Indenture with respect to the Notes, all
monies  then held by any  Person  other  than the  Indenture  Trustee  under the
provisions of this  Indenture  with respect to

                                       22
<PAGE>

such Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to
be held and applied  according to Section 3.05 and  thereupon  such Paying Agent
shall be released from all further liability with respect to such monies.

      Section 4.14.  Temporary Notes.  Pending the preparation of any Definitive
Notes,  the Issuer may  execute and upon its written  direction,  the  Indenture
Trustee may authenticate  and make available for delivery,  temporary Notes that
are printed,  lithographed,  typewritten,  photocopied or otherwise produced, in
any denomination,  substantially of the tenor of the Definitive Notes in lieu of
which  they  are  issued  and  with  such  appropriate  insertions,   omissions,
substitutions  and other  variations  as the officers  executing  such Notes may
determine, as evidenced by their execution of such Notes.

      If temporary Notes are issued,  the Issuer will cause  Definitive Notes to
be prepared without  unreasonable delay. After the preparation of the Definitive
Notes,  the temporary  Notes shall be  exchangeable  for  Definitive  Notes upon
surrender  of the  temporary  Notes at the  office or  agency  of the  Indenture
Trustee,  without charge to the Holder.  Upon surrender for  cancellation of any
one or more temporary Notes, the Issuer shall execute and the Indenture  Trustee
shall  authenticate  and make  available  for  delivery,  in exchange  therefor,
Definitive  Notes of  authorized  denominations  and of like tenor and aggregate
principal amount. Until so exchanged, such temporary Notes shall in all respects
be entitled to the same benefits under this Indenture as Definitive Notes.

                                   ARTICLE V

                              DEFAULT AND REMEDIES

      Section 5.01. Events of Default. The Issuer shall deliver to the Indenture
Trustee and the Credit  Enhancer within five calendar days after learning of the
occurrence  of any event  which  with the giving of notice and the lapse of time
would become an Event of Default under clause (iii) of the  definition of "Event
of Default" written notice in the form of an Officer's Certificate of its status
and what action the Issuer is taking or proposes to take with respect thereto.

      Section 5.02.  Acceleration of Maturity;  Rescission and Annulment.  If an
Event of Default should occur and be continuing, then and in every such case the
Indenture Trustee or the Holders of Notes  representing not less than a majority
of the  aggregate  Note  Balance  of all Notes with the  written  consent of the
Credit Enhancer (so long as no Credit Enhancer  Default  exists),  or the Credit
Enhancer (so long as no Credit Enhancer Default exists) may declare the Notes to
be immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture  Trustee if given by  Noteholders),  and upon any such declaration the
unpaid principal amount of such Notes, together with accrued and unpaid interest
thereon  through the date of  acceleration,  shall  become  immediately  due and
payable.

      At any time  after such  declaration  of  acceleration  of  maturity  with
respect to an Event of Default has been made and before a judgment or decree for
payment  of the  money  due  has  been  obtained  by the  Indenture  Trustee  as
hereinafter  in this  Article V provided,  the Holders of Notes  representing  a
majority of the aggregate  Note Balance of all Notes,  by written  notice to the
Issuer and the Indenture Trustee with the written consent of the Credit Enhancer
(so long as no Credit

                                       23
<PAGE>

Enhancer Default exists),  or the Credit Enhancer (so long as no Credit Enhancer
Default  exists) may in writing  waive the related  Event of Default and rescind
and annul such declaration and its consequences if:

            (i) the Issuer has paid or deposited  with the  Indenture  Trustee a
      sum sufficient to pay:

                  (A) all sums due and payable to the Credit Enhancer; and

                  (B) all payments of principal of and interest on the Notes and
            all other amounts that would then be due hereunder or upon the Notes
            if the Event of Default  giving  rise to such  acceleration  had not
            occurred; and

                  (C)  all  sums  paid  or  advanced  by the  Indenture  Trustee
            hereunder and the reasonable compensation,  expenses,  disbursements
            and  advances of the  Indenture  Trustee and its agents and counsel;
            and

            (ii)  all  Events  of  Default,  other  than the  nonpayment  of the
      principal  of the Notes that has  become due solely by such  acceleration,
      have been cured or waived as provided in Section 5.12.

No such  rescission  shall  affect  any  subsequent  default or impair any right
consequent thereto.

      Section 5.03.  Collection of  Indebtedness  and Suits for  Enforcement  by
Indenture  Trustee.  (a) Subject to Section 3.31,  the Issuer  covenants that if
default in the payment of (i) any interest on any Note when the same becomes due
and payable,  and such default  continues for a period of five days, or (ii) the
principal  of or any  installment  of the  principal  of any Note  when the same
becomes due and payable, the Issuer shall, upon demand of the Indenture Trustee,
pay to it, for the  benefit of the Holders of Notes,  the whole  amount then due
and payable on the Notes for  principal  and  interest,  with  interest upon the
overdue  principal,  and in addition  thereto  such  further  amount as shall be
sufficient  to cover  the  costs  and  expenses  of  collection,  including  the
reasonable compensation,  expenses,  disbursements and advances of the Indenture
Trustee and its agents and counsel.

      (b) In case the Issuer shall fail  forthwith to pay such amounts upon such
demand,  the  Indenture  Trustee,  in its own name and as  trustee of an express
trust,  subject to the  provisions  of Section  10.17  hereof  may  institute  a
Proceeding for the  collection of the sums so due and unpaid,  and may prosecute
such  Proceeding to judgment or final  decree,  and may enforce the same against
the Issuer or other obligor upon the Notes and collect in the manner provided by
law out of the property of the Issuer or other obligor upon the Notes,  wherever
situated, the monies adjudged or decreed to be payable.

      (c) If an Event of Default occurs and is continuing, the Indenture Trustee
subject to the  provisions  of Section  10.17  hereof may, as more  particularly
provided in Section 5.04, in its discretion,  proceed to protect and enforce its
rights and the rights of the Noteholders, by such appropriate Proceedings as the
Indenture  Trustee  shall deem most  effective  to protect  and enforce any such
rights,  whether for the  specific  enforcement  of any covenant or agreement in
this  Indenture or in aid of the  exercise of any power  granted  herein,  or to
enforce  any other

                                       24
<PAGE>

proper  remedy or legal or equitable  right vested in the  Indenture  Trustee by
this Indenture or by law.

      (d) In case there  shall be  pending,  relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest in
the Trust  Estate,  Proceedings  under Title 11 of the United States Code or any
other applicable  federal or state bankruptcy,  insolvency or other similar law,
or in case a receiver,  assignee  or trustee in  bankruptcy  or  reorganization,
liquidator,  sequestrator  or similar  official shall have been appointed for or
taken  possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial  Proceedings  relative to the Issuer
or other  obligor upon the Notes,  or to the creditors or property of the Issuer
or such other  obligor,  the  Indenture  Trustee,  irrespective  of whether  the
principal of any Notes shall then be due and payable as therein  expressed or by
declaration or otherwise and irrespective of whether the Indenture Trustee shall
have made any  demand  pursuant  to the  provisions  of this  Section,  shall be
entitled and empowered, by intervention in such Proceedings or otherwise:

            (i) to file and  prove a claim or  claims  for the  whole  amount of
      principal  and  interest  owing and  unpaid in respect of the Notes and to
      file such other  papers or  documents  as may be necessary or advisable in
      order to have the claims of the Indenture Trustee (including any claim for
      reasonable  compensation  to the  Indenture  Trustee and each  predecessor
      Indenture Trustee, and their respective agents, attorneys and counsel, and
      for  reimbursement  of all  expenses  and  liabilities  incurred,  and all
      advances  made, by the Indenture  Trustee and each  predecessor  Indenture
      Trustee,  except  as a result of  negligence,  willful  misconduct  or bad
      faith) and of the Noteholders allowed in such Proceedings;

            (ii) unless prohibited by applicable law and regulations, to vote on
      behalf of the  Holders of Notes in any  election  of a trustee,  a standby
      trustee or Person performing similar functions in any such Proceedings;

            (iii) to collect and receive any monies or other property payable or
      deliverable on any such claims and to distribute all amounts received with
      respect to the claims of the Noteholders  and of the Indenture  Trustee on
      their behalf; and

            (iv) to file such proofs of claim and other  papers or  documents as
      may be necessary or advisable in order to have the claims of the Indenture
      Trustee  or the  Holders  of Notes  allowed  in any  judicial  proceedings
      relative to the Issuer,  its creditors and its property;  and any trustee,
      receiver,  liquidator,  custodian  or other  similar  official in any such
      Proceeding  is  hereby  authorized  by each of  such  Noteholders  to make
      payments to the  Indenture  Trustee,  and, in the event that the Indenture
      Trustee  shall  consent  to  the  making  of  payments  directly  to  such
      Noteholders,  to pay to the  Indenture  Trustee  such  amounts as shall be
      sufficient to cover reasonable compensation to the Indenture Trustee, each
      predecessor  Indenture Trustee and their respective agents,  attorneys and
      counsel, and all other expenses and liabilities incurred, and all advances
      made,  by the Indenture  Trustee and each  predecessor  Indenture  Trustee
      except as a result of negligence, willful misconduct or bad faith.

                                       25
<PAGE>

      (e) Nothing  herein  contained  shall be deemed to authorize the Indenture
Trustee to  authorize  or consent to or vote for or accept or adopt on behalf of
any  Noteholder  any  plan  of   reorganization,   arrangement,   adjustment  or
composition  affecting  the Notes or the  rights  of any  Holder  thereof  or to
authorize  the  Indenture  Trustee  to  vote  in  respect  of the  claim  of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.

      (f) All rights of action and of asserting claims under this Indenture,  or
under any of the Notes,  may be enforced by the  Indenture  Trustee  without the
possession of any of the Notes or the  production  thereof in any trial or other
Proceedings relative thereto,  and any such action or proceedings  instituted by
the Indenture  Trustee shall be brought in its own name as trustee of an express
trust,  and any  recovery of judgment,  subject to the payment of the  expenses,
disbursements  and  compensation  of the  Indenture  Trustee,  each  predecessor
Indenture  Trustee and their respective  agents and attorneys,  shall be for the
ratable benefit of the Holders of the Notes.

      (g) In any  Proceedings  brought by the  Indenture  Trustee  (and also any
Proceedings  involving the  interpretation of any provision of this Indenture to
which the Indenture  Trustee shall be a party),  the Indenture  Trustee shall be
held to represent all the Holders of the Notes, and it shall not be necessary to
make any Noteholder a party to any such Proceedings.

      Section 5.04. Remedies;  Priorities. (a) If an Event of Default shall have
occurred and be continuing,  the Indenture  Trustee subject to the provisions of
Section  10.17  hereof may with the written  consent of the Credit  Enhancer (so
long as no Credit Enhancer Default exists), or shall at the written direction of
the Credit Enhancer (so long as no Credit Enhancer  Default  exists),  do one or
more of the following (subject to Section 5.05):

            (i)  institute  Proceedings  in its own  name and as  trustee  of an
      express trust for the  collection of all amounts then payable on the Notes
      or under this  Indenture with respect  thereto,  whether by declaration or
      otherwise,  and all amounts payable under the Insurance  Agreement enforce
      any judgment  obtained,  and collect from the Issuer and any other obligor
      upon such Notes monies adjudged due;

            (ii)  institute  Proceedings  from time to time for the  complete or
      partial foreclosure of this Indenture with respect to the Trust Estate;

            (iii)  exercise  any  remedies of a secured  party under the UCC and
      take any other  appropriate  action to protect  and enforce the rights and
      remedies of the Indenture Trustee and the Holders of the Notes;

            (iv)  sell the  Trust  Estate or any  portion  thereof  or rights or
      interest  therein,  at one or more  public or  private  sales  called  and
      conducted in any manner  permitted  by law;  provided,  however,  that the
      Indenture  Trustee may not sell or  otherwise  liquidate  the Trust Estate
      following an Event of Default,  unless (A) the Indenture  Trustee  obtains
      the consent of the Credit  Enhancer,  or if a Credit Enhancer  Default has
      occurred  and is  continuing,  the  consent of the  Holders of 100% of the
      aggregate  Note  Balance  of the  Notes,  (B) the  proceeds  of such  Sale
      distributable  to Holders are  sufficient to discharge in

                                       26
<PAGE>

      full all  amounts  then due and unpaid  upon the Notes for  principal  and
      interest and to reimburse the Credit  Enhancer for any amounts drawn under
      the Credit  Enhancement  Instrument  and any other  amounts due the Credit
      Enhancer  under  the  Insurance  Agreement  or (C) the  Indenture  Trustee
      determines  that the Home Loans will not  continue  to provide  sufficient
      funds for the payment of  principal  of and  interest on the Notes as they
      would have become due if the Notes had not been  declared due and payable,
      and the Indenture  Trustee  obtains the consent of the Credit Enhancer (so
      long as no Credit  Enhancer  Default  exists),  which  consent will not be
      unreasonably  withheld;  provided further that the Indenture Trustee shall
      not sell or otherwise  liquidate  the Trust Estate if the proceeds of such
      sale or  liquidation  will  not be  sufficient  to  discharge  in full all
      amounts then due and unpaid upon the Notes for  principal and interest and
      to reimburse  the Credit  Enhancer for any amounts  drawn under the Credit
      Enhancement Instrument and any other amounts due the Credit Enhancer under
      the Insurance  Agreement unless the Indenture  Trustee obtains the consent
      of the Holders of 66 2/3% of the aggregate  Note Balance of the Notes with
      the consent of the Credit Enhancer (so long as no Credit Enhancer  Default
      exists),  or the Credit  Enhancer (so long as no Credit  Enhancer  Default
      exists).  In determining such sufficiency or insufficiency with respect to
      clauses (B) and (C), the Indenture  Trustee may, but need not,  obtain and
      rely upon an opinion of an  Independent  investment  banking or accounting
      firm of national  reputation as to the feasibility of such proposed action
      and  as  to  the  sufficiency  of  the  Trust  Estate  for  such  purpose.
      Notwithstanding  the  foregoing,  so long as a  Servicing  Default has not
      occurred,  any  Sale of the  Trust  Estate  shall be made  subject  to the
      continued  servicing of the Home Loans by the Master  Servicer as provided
      in the Servicing Agreement.

      (b) If the Indenture  Trustee  collects any money or property  pursuant to
this Article V, it shall pay out the money or property in the following order:

      FIRST:  to the  Indenture  Trustee for all amounts due under  Section 6.07
      herein;

      SECOND:  to the  Holders  of the Notes for  amounts  due and unpaid on the
      Notes for  interest,  according  to the order  and  priority  set forth in
      Section  3.05(a)(ii)  from amounts  available in the Trust Estate for such
      Noteholders;

      THIRD:  on a pro rata  basis,  to Holders of the Notes for amounts due and
      unpaid on the Notes for  principal,  from  amounts  available in the Trust
      Estate for such  Noteholders,  according to the amounts due and payable on
      the Notes for principal,  until the related Note Balances of the Notes are
      reduced to zero;

      FOURTH: [reserved];

      FIFTH:  to the payment of all amounts due and owing to the Credit Enhancer
      under the Insurance Agreement;

      SIXTH: to the Certificate  Paying Agent for amounts due under Article VIII
      of the Trust Agreement; and

      SEVENTH:  to the  payment of the  remainder,  if any, to the Issuer or any
      other person legally entitled thereto.

                                       27
<PAGE>

      The  Indenture  Trustee  may fix a record  date and  payment  date for any
payment to  Noteholders  pursuant to this Section  5.04. At least 15 days before
such record date, the Indenture  Trustee shall mail to each  Noteholder a notice
that states the record date, the payment date and the amount to be paid.

      Section 5.05. Optional Preservation of the Trust Estate. If the Notes have
been  declared to be due and payable  under  Section 5.02  following an Event of
Default and such  declaration and its  consequences  have not been rescinded and
annulled,  the  Indenture  Trustee  may,  but need not (but shall at the written
direction of the Credit Enhancer,  so long as no Credit Enhancer Default exists)
elect to take and maintain  possession of the Trust Estate.  It is the desire of
the parties  hereto and the  Noteholders  that there be at all times  sufficient
funds  for the  payment  of  principal  of and  interest  on the Notes and other
obligations  of the Issuer  including  payment to the  Credit  Enhancer  and the
Indenture  Trustee shall take such desire into account when determining  whether
or not to take and  maintain  possession  of the Trust  Estate.  In  determining
whether to take and  maintain  possession  of the Trust  Estate,  the  Indenture
Trustee may,  but need not,  obtain (at the expense of the Issuer) and rely upon
an opinion of an Independent  investment  banking or accounting firm of national
reputation  as to  the  feasibility  of  such  proposed  action  and  as to  the
sufficiency of the Trust Estate for such purpose.

      Section 5.06.  Limitation  of Suits.  No Holder of any Note shall have any
right to institute any Proceeding,  judicial or otherwise,  with respect to this
Indenture,  or for the  appointment  of a receiver or trustee,  or for any other
remedy hereunder, unless and subject to the provisions of Section 10.17 hereof:

            (i) such Holder has previously given written notice to the Indenture
      Trustee of a continuing Event of Default;

            (ii) the Holders of not less than 25% of the aggregate  Note Balance
      of the  Notes  have made  written  request  to the  Indenture  Trustee  to
      institute  such  Proceeding in respect of such Event of Default in its own
      name as Indenture Trustee hereunder;

            (iii) such Holder or Holders have offered to the  Indenture  Trustee
      reasonable  indemnity  against the costs,  expenses and  liabilities to be
      incurred in complying with such request;

            (iv) the  Indenture  Trustee  for 60 days after its  receipt of such
      notice,  request  and offer of  indemnity  has  failed to  institute  such
      Proceedings; and

            (v) no direction  inconsistent  with such  written  request has been
      given to the Indenture Trustee during such 60 day period by the Holders of
      a majority  of the  aggregate  Note  Balance of the Notes or by the Credit
      Enhancer.

It is  understood  and intended  that no one or more Holders of Notes shall have
any right in any manner  whatever by virtue of, or by availing of, any provision
of this  Indenture  to  affect,  disturb  or  prejudice  the rights of any other
Holders of Notes or to obtain or to seek to obtain  priority or preference  over
any other  Holders or to enforce any right under this  Indenture,  except in the
manner herein provided.

                                       28
<PAGE>

      In  the  event  the  Indenture   Trustee  shall  receive   conflicting  or
inconsistent requests and indemnity from two or more groups of Holders of Notes,
each  representing  less than a majority of the  aggregate  Note  Balance of the
Notes,  the Indenture  Trustee in its sole discretion may determine what action,
if any, shall be taken, notwithstanding any other provisions of this Indenture.

      Section 5.07.  Rights of  Noteholders  to Receive  Principal and Interest.
Notwithstanding  any other provisions in this Indenture,  but subject to Section
3.31,  the  Holder of any Note  shall  have the  right,  which is  absolute  and
unconditional,  to receive payment of the principal of and interest,  if any, on
such Note on or after the respective due dates thereof expressed in such Note or
in this Indenture and to institute suit for the enforcement of any such payment,
and such right shall not be impaired without the consent of such Holder.

      Section 5.08. Restoration of Rights and Remedies. If the Indenture Trustee
or any  Noteholder  has instituted any Proceeding to enforce any right or remedy
under this Indenture and such Proceeding has been  discontinued or abandoned for
any reason or has been determined  adversely to the Indenture Trustee or to such
Noteholder,  then and in every such case the Issuer,  the Indenture  Trustee and
the Noteholders  shall,  subject to any  determination  in such  Proceeding,  be
restored  severally  and  respectively  to  their  respective  former  positions
hereunder,  and thereafter all rights and remedies of the Indenture  Trustee and
the Noteholders shall continue as though no such Proceeding had been instituted.

      Section 5.09.  Rights and Remedies  Cumulative.  No right or remedy herein
conferred upon or reserved to the Indenture  Trustee,  the Credit Enhancer or to
the  Noteholders  is intended to be exclusive of any other right or remedy,  and
every right and remedy shall, to the extent  permitted by law, be cumulative and
in addition to every other right and remedy given  hereunder or now or hereafter
existing at law or in equity or  otherwise.  The  assertion or employment of any
right or remedy  hereunder,  or  otherwise,  shall not  prevent  the  concurrent
assertion or employment of any other appropriate right or remedy.

      Section 5.10. Delay or Omission Not a Waiver.  No delay or omission of the
Indenture Trustee, the Credit Enhancer or any Holder of any Note to exercise any
right or remedy  accruing  upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default or an acquiescence
therein.  Every  right  and  remedy  given  by this  Article  V or by law to the
Indenture  Trustee or to the Noteholders may be exercised from time to time, and
as  often  as may  be  deemed  expedient,  by the  Indenture  Trustee  or by the
Noteholders, as the case may be.

      Section  5.11.  Control by the Credit  Enhancer  or the  Noteholders.  The
Holders of a majority of the aggregate Note Balance of Notes with the consent of
the Credit  Enhancer  (so long as no Credit  Enhancer  Default  exists),  or the
Credit  Enhancer (so long as no Credit  Enhancer  Default exists) shall have the
right to direct the time,  method and place of conducting any Proceeding for any
remedy  available  to  the  Indenture  Trustee  with  respect  to the  Notes  or
exercising any trust or power conferred on the Indenture Trustee; provided that:

            (i) such direction  shall not be in conflict with any rule of law or
      with this Indenture;

                                       29
<PAGE>

            (ii) subject to the express terms of Section 5.04,  any direction to
      the  Indenture  Trustee to sell or liquidate  the Trust Estate shall be by
      Holders of Notes  representing  not less than 100% of the  aggregate  Note
      Balance of Notes with the  consent of the Credit  Enhancer  (so long as no
      Credit  Enhancer  Default  exists),  or the Credit Enhancer (so long as no
      Credit Enhancer Default exists);

            (iii)  if the  conditions  set  forth  in  Section  5.05  have  been
      satisfied  and the  Indenture  Trustee  elects to retain the Trust  Estate
      pursuant to such Section,  then any direction to the Indenture  Trustee by
      Holders of Notes representing less than 100% of the aggregate Note Balance
      of Notes to sell or  liquidate  the Trust  Estate shall be of no force and
      effect; and

            (iv) the  Indenture  Trustee may take any other action deemed proper
      by the Indenture Trustee that is not inconsistent with such direction.

Notwithstanding the rights of Noteholders set forth in this Section,  subject to
Section 6.01, the Indenture  Trustee need not take any action that it determines
might involve it in liability or might materially adversely affect the rights of
any Noteholders  not consenting to such action unless the Indenture  Trustee has
received satisfactory indemnity from the Credit Enhancer or the Noteholders.

      Section 5.12.  Waiver of Past  Defaults.  Prior to the  declaration of the
acceleration  of the  maturity  of the Notes as provided  in Section  5.02,  the
Holders of Notes of not less than a majority of the  aggregate  Note  Balance of
the Notes with the consent of the Credit Enhancer (so long as no Credit Enhancer
Default  exists),  or the Credit Enhancer (so long as no Credit Enhancer Default
exists) may waive any past Event of Default and its consequences except an Event
of Default (a) with respect to payment of principal of or interest on any of the
Notes or (b) in  respect of a  covenant  or  provision  hereof  which  cannot be
modified or amended  without the consent of the Holder of each Note. In the case
of any such waiver,  the Issuer,  the  Indenture  Trustee and the Holders of the
Notes  shall be  restored  to  their  former  positions  and  rights  hereunder,
respectively;  but no such waiver shall extend to any  subsequent or other Event
of Default or impair any right consequent thereto.

      Upon any such  waiver,  any Event of Default  arising  therefrom  shall be
deemed to have been cured and not to have  occurred,  for every  purpose of this
Indenture;  but no such waiver shall extend to any  subsequent or other Event of
Default or impair any right consequent thereto.

      Section 5.13.  Undertaking for Costs. All parties to this Indenture agree,
and each Holder of any Note by such Holder's  acceptance thereof shall be deemed
to have agreed,  that any court may in its discretion  require,  in any suit for
the  enforcement  of any right or remedy  under this  Indenture,  or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture  Trustee,  the  filing  by any  party  litigant  in  such  suit  of an
undertaking  to pay the  costs of such  suit,  and that  such  court  may in its
discretion  assess  reasonable  costs,  including  reasonable  attorneys'  fees,
against  any party  litigant  in such suit,  having due regard to the merits and
good  faith of the  claims or  defenses  made by such  party  litigant;  but the
provisions  of this Section 5.13 shall not apply to (a) any suit  instituted  by
the Indenture  Trustee,  (b) any suit instituted by any Noteholder,  or group of
Noteholders,  in  each  case  holding  in the  aggregate

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<PAGE>

more  than  10% of the  aggregate  Note  Balance  of the  Notes  or (c) any suit
instituted by any Noteholder for the  enforcement of the payment of principal of
or interest on any Note on or after the respective  due dates  expressed in such
Note and in this Indenture.

      Section 5.14.  Waiver of Stay or Extension Laws. The Issuer  covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
or plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension  law  wherever  enacted,  now or at any time  hereafter in
force,  that may affect the covenants or the performance of this Indenture;  and
the Issuer (to the extent that it may  lawfully do so) hereby  expressly  waives
all  benefit  or  advantage  of any such law,  and  covenants  that it shall not
hinder,  delay or impede  the  execution  of any  power  herein  granted  to the
Indenture Trustee,  but will suffer and permit the execution of every such power
as though no such law had been enacted.

      Section  5.15.  Sale of Trust  Estate.  (a) The power to effect  any sale,
liquidation  or other  disposition (a "Sale") of any portion of the Trust Estate
pursuant to Section 5.04 is expressly  subject to the provisions of Section 5.05
and this Section 5.15.  The power to effect any such Sale shall not be exhausted
by any one or more Sales as to any portion of the Trust Estate remaining unsold,
but shall continue unimpaired until the entire Trust Estate shall have been sold
or all  amounts  payable  on the Notes and under  this  Indenture  and under the
Insurance Agreement shall have been paid. The Indenture Trustee may from time to
time postpone any public Sale by public  announcement made at the time and place
of such Sale.  The Indenture  Trustee hereby  expressly  waives its right to any
amount fixed by law as compensation for any Sale.

      (b) The  Indenture  Trustee  shall not in any private  Sale sell the Trust
Estate, or any portion thereof, unless:

            (1) the Holders of all Notes with the consent of the Credit Enhancer
      (so long as no Credit Enhancer Default exists), or the Credit Enhancer (so
      long as no Credit  Enhancer  Default  exists)  consent  to, or direct  the
      Indenture Trustee to make, such Sale, or

            (2) the  proceeds  of such Sale  would  not be less than the  entire
      amount  which  would be payable to the  Noteholders  under the Notes,  the
      Certificateholder under the Certificate and the Credit Enhancer in respect
      of amounts  drawn under the Credit  Enhancement  Instrument  and any other
      amounts due the Indenture  Trustee in connection with expenses incurred by
      reason of such sale and any other  amounts due the Credit  Enhancer  under
      the  Insurance  Agreement,  in full  payment  thereof in  accordance  with
      Section 5.02, on the Payment Date next  succeeding  the date of such Sale,
      or

            (3) the Indenture Trustee determines,  in its sole discretion,  that
      the conditions for retention of the Trust Estate set forth in Section 5.05
      cannot be  satisfied  (in making  any such  determination,  the  Indenture
      Trustee may rely upon an opinion of an Independent investment banking firm
      obtained  and  delivered  as  provided  in Section  5.05),  and the Credit
      Enhancer (so long as no Credit Enhancer  Default  exists),  or the Holders
      representing  at least 66-2/3% of the aggregate  Note Balance of the Notes
      with the  consent of the Credit  Enhancer  (so long as no Credit  Enhancer
      Default exists), consent to such Sale.

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<PAGE>

The purchase by the Indenture  Trustee of all or any portion of the Trust Estate
at a private  Sale shall not be deemed a Sale or other  disposition  thereof for
purposes of this Section 5.15(b).

      (c) Unless the Holders with the consent of the Credit Enhancer (so long as
no Credit Enhancer Default exists), or the Credit Enhancer (so long as no Credit
Enhancer  Default  exists) have  otherwise  consented or directed the  Indenture
Trustee, at any public Sale of all or any portion of the Trust Estate at which a
minimum bid equal to or greater than the amount  described  in paragraph  (2) of
subsection  (b) of this Section 5.15 has not been  established  by the Indenture
Trustee and no Person bids an amount equal to or greater  than such amount,  the
Indenture Trustee shall bid an amount at least $1.00 more than the highest other
bid.

      (d) In connection with a Sale of all or any portion of the Trust Estate:

            (1) any Holder or Holders of Notes may bid for and with the  consent
      of the Credit  Enhancer  (so long as no Credit  Enhancer  Default  exists)
      purchase the property offered for sale, and upon compliance with the terms
      of sale may hold, retain and possess and dispose of such property, without
      further  accountability,  and may, in paying the purchase money  therefor,
      deliver any Notes or claims for interest thereon in lieu of cash up to the
      amount  which shall,  upon  payment of the net  proceeds of such sale,  be
      payable  thereon,  and such Notes,  in case the amounts so payable thereon
      shall be less  than the  amount  due  thereon,  shall be  returned  to the
      Holders  thereof  after being  appropriately  stamped to show such partial
      payment;

            (2) the  Indenture  Trustee  may bid for and  acquire  the  property
      offered for Sale in connection with any Sale thereof,  and, subject to any
      requirements  of,  and to  the  extent  permitted  by,  applicable  law in
      connection therewith,  may purchase all or any portion of the Trust Estate
      in a  private  sale,  and,  in lieu of  paying  cash  therefor,  may  make
      settlement  for the  purchase  price by  crediting  the gross  Sale  price
      against  the sum of (A) the amount  which  would be  distributable  to the
      Holders of the Notes and the Holder of the  Certificate  and amounts owing
      to the Credit Enhancer as a result of such Sale in accordance with Section
      5.04(b) on the Payment Date next  succeeding the date of such Sale and (B)
      the expenses of the Sale and of any  Proceedings  in connection  therewith
      which are  reimbursable to it, without being required to produce the Notes
      in order to  complete  any such Sale or in order for the net Sale price to
      be  credited  against  such  Notes,  and any  property  so acquired by the
      Indenture  Trustee shall be held and dealt with by it in  accordance  with
      the provisions of this Indenture;

            (3) the Indenture  Trustee shall execute and deliver an  appropriate
      instrument of conveyance  transferring  its interest in any portion of the
      Trust Estate in connection with a Sale thereof;

            (4) the Indenture Trustee is hereby irrevocably  appointed the agent
      and  attorney-in-fact of the Issuer to transfer and convey its interest in
      any portion of the Trust Estate in connection with a Sale thereof,  and to
      take all action necessary to effect such Sale; and

                                       32
<PAGE>

            (5) no  purchaser  or  transferee  at such a Sale  shall be bound to
      ascertain the Indenture Trustee's authority, inquire into the satisfaction
      of any conditions precedent or see to the application of any monies.

      Section 5.16.  Action on Notes. The Indenture  Trustee's right to seek and
recover  judgment on the Notes or under this Indenture  shall not be affected by
the seeking,  obtaining or application of any other relief under or with respect
to this Indenture. Neither the lien of this Indenture nor any rights or remedies
of the Indenture Trustee or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture  Trustee  against the Issuer or by the levy of any
execution  under such  judgment upon any portion of the Trust Estate or upon any
of the assets of the Issuer.  Any money or property  collected by the  Indenture
Trustee shall be applied in accordance with Section 5.04(b).

      Section 5.17.  Performance  and  Enforcement of Certain  Obligations.  (a)
Promptly  following a written  request from the Credit Enhancer or the Indenture
Trustee with the written  consent of the Credit Enhancer to do so (so long as no
Credit Enhancer  Default exists),  the Issuer,  in its capacity as holder of the
Home Loans,  shall,  with the written consent of the Credit Enhancer (so long as
no Credit Enhancer Default exists), take all such lawful action as the Indenture
Trustee may request to cause the Issuer to compel or secure the  performance and
observance  by the Seller and the Master  Servicer,  as  applicable,  of each of
their  obligations  to the  Issuer  under or in  connection  with the Home  Loan
Purchase  Agreement  and the  Servicing  Agreement,  and to exercise any and all
rights,  remedies,  powers and privileges lawfully available to the Issuer under
or in  connection  with the  Home  Loan  Purchase  Agreement  and the  Servicing
Agreement to the extent and in the manner directed by the Indenture Trustee,  as
pledgee of the Home Loans,  including the  transmission of notices of default on
the part of the Seller or the Master Servicer  thereunder and the institution of
legal or administrative  actions or proceedings to compel or secure  performance
by the Seller or the Master Servicer of each of their obligations under the Home
Loan Purchase Agreement and the Servicing Agreement.

      (b) If an Event of Default has occurred and is  continuing,  the Indenture
Trustee,  as  pledgee  of the Home  Loans,  subject  to the rights of the Credit
Enhancer  under  the  Servicing  Agreement  may,  and  at the  direction  (which
direction  shall be in writing or by telephone  (confirmed  in writing  promptly
thereafter))  of the  Credit  Enhancer  (or if a  Credit  Enhancer  Default  has
occurred and is continuing,  Holders of 66-2/3% of the aggregate Note Balance of
the Notes) shall, exercise all rights, remedies,  powers,  privileges and claims
of the Issuer  against the Seller or the Master  Servicer under or in connection
with the Home Loan Purchase Agreement and the Servicing Agreement, including the
right or power to take any action to compel or secure  performance or observance
by the  Seller  or the  Master  Servicer,  as the case may be,  of each of their
obligations to the Issuer thereunder and to give any consent,  request,  notice,
direction,  approval, extension or waiver under the Home Loan Purchase Agreement
and the Servicing Agreement,  as the case may be, and any right of the Issuer to
take such action shall not be suspended.  In connection therewith, as determined
by the Indenture Trustee,  the Issuer shall take all actions necessary to effect
the transfer of the Home Loans to the Indenture Trustee.

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<PAGE>

                                   ARTICLE VI

                              THE INDENTURE TRUSTEE

      Section 6.01. Duties of Indenture Trustee.  (a) If an Event of Default has
occurred and is continuing,  the Indenture Trustee shall exercise the rights and
powers vested in it by this  Indenture 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.

      (b) Except during the continuance of an Event of Default:

            (i) the Indenture Trustee undertakes to perform such duties and only
      such duties as are specifically set forth in this Indenture and no implied
      covenants or  obligations  shall be read into this  Indenture  against the
      Indenture Trustee; and

            (ii) in the absence of bad faith on its part, the Indenture  Trustee
      may  conclusively  rely,  as to  the  truth  of  the  statements  and  the
      correctness  of the  opinions  expressed  therein,  upon  certificates  or
      opinions  furnished  to  the  Indenture  Trustee  and  conforming  to  the
      requirements  of this  Indenture;  however,  the  Indenture  Trustee shall
      examine the  certificates  and opinions to  determine  whether or not they
      conform to the requirements of this Indenture.

      (c) The Indenture  Trustee may not be relieved from  liability for its own
negligent  action,  its  own  negligent  failure  to  act  or  its  own  willful
misconduct, except that:

            (i) this  paragraph  does not limit the effect of  paragraph  (b) of
      this Section 6.01;

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

            (iii) the Indenture  Trustee shall not be liable with respect to any
      action  it  takes or omits  to take in good  faith  in  accordance  with a
      direction  received  by it (A)  pursuant  to Section  5.11 or (B) from the
      Credit  Enhancer,  which it is  entitled  to give  under  any of the Basic
      Documents.

      (d) The  Indenture  Trustee  shall not be liable for interest on any money
received by it except as the  Indenture  Trustee  may agree in writing  with the
Issuer.

      (e) Money held in trust by the  Indenture  Trustee need not be  segregated
from  other  funds  except to the  extent  required  by law or the terms of this
Indenture or the Trust Agreement.

      (f) No provision of this Indenture shall require the Indenture  Trustee 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 it shall have reasonable  grounds to believe that repayment
of such  funds or  adequate  indemnity  against  such risk or  liability  is not
reasonably assured to it.

                                       34
<PAGE>

      (g) Every provision of this Indenture relating to the conduct or affecting
the  liability of or affording  protection  to the  Indenture  Trustee  shall be
subject to the provisions of this Section and to the provisions of the TIA.

      Section 6.02. Rights of Indenture  Trustee.  (a) The Indenture Trustee may
rely on any  document  believed  by it to be genuine  and to have been signed or
presented by the proper person.  The Indenture  Trustee need not investigate any
fact or matter stated in the document.

      (b) Before the  Indenture  Trustee acts or refrains  from  acting,  it may
require an Officer's Certificate or an Opinion of Counsel. The Indenture Trustee
shall not be liable  for any  action it takes or omits to take in good  faith in
reliance on an Officer's Certificate or Opinion of Counsel.

      (c)  The  Indenture  Trustee  may  execute  any of the  trusts  or  powers
hereunder  or perform  any duties  hereunder  either  directly  or by or through
agents or attorneys or a custodian or nominee,  and the Indenture  Trustee shall
not be  responsible  for any misconduct or negligence on the part of, or for the
supervision of, any such agent,  attorney,  custodian or nominee  appointed with
due care by it hereunder.

      (d) The  Indenture  Trustee shall not be liable for any action it takes or
omits to take in good faith  which it believes  to be  authorized  or within its
rights or powers;  provided,  however, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.

      (e) The  Indenture  Trustee may consult  with  counsel,  and the advice or
opinion of counsel with respect to legal matters  relating to this Indenture and
the Notes shall be full and complete authorization and protection from liability
in respect to any action  taken,  omitted or  suffered by it  hereunder  in good
faith and in accordance with the advice or opinion of such counsel.

      Section  6.03.  Individual  Rights of  Indenture  Trustee.  The  Indenture
Trustee in its  individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Issuer or its Affiliates  with the same
rights it would have if it were not Indenture  Trustee.  Any Note Registrar,  co
registrar  or co paying  agent may do the same with like  rights.  However,  the
Indenture Trustee must comply with Sections 6.11 and 6.12.

      Section 6.04. Indenture Trustee's Disclaimer.  The Indenture Trustee shall
not be (i)  responsible  for and makes no  representation  as to the validity or
adequacy of this Indenture or the Notes,  (ii)  accountable for the Issuer's use
of the proceeds  from the Notes or (iii)  responsible  for any  statement of the
Issuer in the Indenture or in any document issued in connection with the sale of
the Notes or in the Notes  other than the  Indenture  Trustee's  certificate  of
authentication.

      Section 6.05.  Notice of Event of Default.  If an Event of Default  occurs
and is continuing  and if it is known to a Responsible  Officer of the Indenture
Trustee, the Indenture Trustee shall give notice thereof to the Credit Enhancer.
The  Indenture  Trustee  shall  mail to each  Noteholder  notice of the Event of
Default  within  90 days  after  it  occurs.  Except  in the case of an Event of
Default  in payment of  principal  of or  interest  on any Note,  the  Indenture
Trustee may withhold the notice if and so long as a committee of its Responsible
Officers  in  good  faith  determines  that

                                       35
<PAGE>

withholding the notice is in the interests of Noteholders. The Indenture Trustee
shall  not be  deemed  to have  knowledge  of any  Event  of  Default  unless  a
Responsible Officer has written notice or actual knowledge thereof.

      Section  6.06.  Reports by  Indenture  Trustee to Holders.  The  Indenture
Trustee shall deliver to each Noteholder such  information as may be required to
enable  such holder to prepare its  federal  and state  income tax  returns.  In
addition,  upon the  Issuer's  written  request,  the  Indenture  Trustee  shall
promptly  furnish  information  reasonably  requested  by  the  Issuer  that  is
reasonably  available to the  Indenture  Trustee to enable the Issuer to perform
its federal and state income tax reporting obligations.

      Section 6.07.  Compensation and Indemnity.  The Indenture Trustee shall be
compensated  and  indemnified by the Master  Servicer in accordance with Section
6.06 of the Servicing Agreement.  The Indenture Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express trust.

      Section 6.08.  Replacement of Indenture Trustee. No resignation or removal
of the Indenture  Trustee and no  appointment of a successor  Indenture  Trustee
shall become  effective  until the  acceptance of  appointment  by the successor
Indenture  Trustee  pursuant to this Section  6.08.  The  Indenture  Trustee may
resign at any time by so  notifying  the  Issuer and the  Credit  Enhancer.  The
Holders of a majority of the  aggregate  Note Balance of the Notes or the Credit
Enhancer (so long as no Credit Enhancer Default exists) may remove the Indenture
Trustee by so notifying  the Indenture  Trustee and the Credit  Enhancer and may
appoint a successor  Indenture  Trustee.  The Issuer shall remove the  Indenture
Trustee if:

            (i) the Indenture Trustee fails to comply with Section 6.11;

            (ii) the Indenture Trustee is adjudged a bankrupt or insolvent;

            (iii) a  receiver  or  other  public  officer  takes  charge  of the
      Indenture Trustee or its property; or

            (iv) the Indenture Trustee otherwise becomes incapable of acting.

If the  Indenture  Trustee  resigns or is removed or if a vacancy  exists in the
office of the Indenture  Trustee for any reason (the  Indenture  Trustee in such
event being referred to herein as the retiring  Indenture  Trustee),  the Issuer
shall  promptly  appoint a successor  Indenture  Trustee with the consent of the
Credit Enhancer (so long as no Credit Enhancer  Default  exists),  which consent
will not be  unreasonably  withheld.  In addition,  the  Indenture  Trustee will
resign to avoid being directly or indirectly controlled by the Issuer.

      A successor  Indenture  Trustee shall deliver a written  acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer.  Thereupon, the
resignation or removal of the retiring Indenture Trustee shall become effective,
and the successor Indenture Trustee shall have all the rights, powers and duties
of the Indenture Trustee under this Indenture.  The successor  Indenture Trustee
shall mail a notice of its  succession to  Noteholders.  The retiring  Indenture
Trustee shall promptly  transfer all property held by it as Indenture Trustee to
the successor Indenture Trustee.

                                       36
<PAGE>

      If a successor Indenture Trustee does not take office within 60 days after
the retiring  Indenture  Trustee resigns or is removed,  the retiring  Indenture
Trustee,  the Issuer or the Holders of a majority of the aggregate  Note Balance
of  the  Notes  may  petition  any  court  of  competent  jurisdiction  for  the
appointment of a successor Indenture Trustee.

      If the Indenture Trustee fails to comply with Section 6.11, any Noteholder
may  petition  any  court  of  competent  jurisdiction  for the  removal  of the
Indenture Trustee and the appointment of a successor Indenture Trustee.

      Notwithstanding  the replacement of the Indenture Trustee pursuant to this
Section,  the Issuer's  obligations  under  Section 6.07 shall  continue for the
benefit of the retiring Indenture Trustee.

      Section  6.09.  Successor  Indenture  Trustee by Merger.  If the Indenture
Trustee  consolidates  with,  merges  or  converts  into,  or  transfers  all or
substantially all its corporate trust business or assets to, another corporation
or banking  association,  the  resulting,  surviving or  transferee  corporation
without any further act shall be the successor Indenture Trustee; provided, that
such  corporation  or  banking  association  shall be  otherwise  qualified  and
eligible  under  Section 6.11.  The  Indenture  Trustee shall provide the Rating
Agencies  written  notice of any such  transaction  occurring  after the Closing
Date.

      In case at the time such successor or successors by merger,  conversion or
consolidation  to the Indenture  Trustee shall succeed to the trusts  created by
this Indenture any of the Notes shall have been authenticated but not delivered,
any such  successor  to the  Indenture  Trustee  may  adopt the  certificate  of
authentication   of  any  predecessor   trustee,   and  deliver  such  Notes  so
authenticated;  and in case at that  time any of the  Notes  shall not have been
authenticated,  any successor to the  Indenture  Trustee may  authenticate  such
Notes  either  in the name of any  predecessor  hereunder  or in the name of the
successor  to the  Indenture  Trustee;  and in all such cases such  certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.

      Section 6.10.  Appointment of Co-Indenture  Trustee or Separate  Indenture
Trustee.  (a)  Notwithstanding  any other  provisions of this Indenture,  at any
time, for the purpose of meeting any legal  requirement of any  jurisdiction  in
which any part of the Trust  Estate may at the time be  located,  the  Indenture
Trustee  shall have the power and may execute and  deliver  all  instruments  to
appoint one or more Persons to act as a co-trustee or  co-trustees,  or separate
trustee or separate  trustees,  of all or any part of the Trust  Estate,  and to
vest in such  Person or  Persons,  in such  capacity  and for the benefit of the
Noteholders,  such title to the Trust Estate, or any part thereof,  and, subject
to the other  provisions  of this  Section,  such powers,  duties,  obligations,
rights and trusts as the Indenture Trustee may consider  necessary or desirable.
No co-trustee or separate trustee  hereunder shall be required to meet the terms
of  eligibility  as a  successor  trustee  under  Section  6.11 and no notice to
Noteholders of the  appointment  of any co-trustee or separate  trustee shall be
required under Section 6.08 hereof.

      (b) Every separate  trustee and co-trustee  shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:

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<PAGE>

            (i) all rights,  powers, duties and obligations conferred or imposed
      upon  the  Indenture  Trustee  shall  be  conferred  or  imposed  upon and
      exercised or performed by the Indenture  Trustee and such separate trustee
      or co-trustee  jointly (it being  understood that such separate trustee or
      co-trustee  is not  authorized  to act  separately  without the  Indenture
      Trustee  joining in such act),  except to the extent that under any law of
      any  jurisdiction  in which any particular act or acts are to be performed
      the Indenture  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 Estate or any portion thereof
      in any such jurisdiction)  shall be exercised and performed singly by such
      separate  trustee  or  co-trustee,  but  solely  at the  direction  of the
      Indenture Trustee;

            (ii) no trustee  hereunder  shall be personally  liable by reason of
      any act or omission of any other trustee hereunder; and

            (iii) the Indenture  Trustee may at any time accept the  resignation
      of or remove any separate trustee or co-trustee.

      (c) Any notice,  request or other writing  given to the Indenture  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 VI. 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
Indenture Trustee or separately,  as may be provided therein, subject to all the
provisions of this  Indenture,  specifically  including  every provision of this
Indenture  relating to the conduct of,  affecting the liability of, or affording
protection to, the Indenture Trustee.  Every such instrument shall be filed with
the Indenture Trustee.

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

      Section 6.11. Eligibility;  Disqualification.  The Indenture Trustee shall
at all times satisfy the requirements of TIA ss. 310(a).  The Indenture  Trustee
shall have a combined  capital and surplus of at least  $50,000,000 as set forth
in its most recent  published  annual  report of condition  and it or its parent
shall  have a long term debt  rating of A or better by  Moody's.  The  Indenture
Trustee  shall comply with TIA ss.  310(b),  including  the  optional  provision
permitted by the second sentence of TIA ss. 310(b)(9);  provided,  however, that
there shall be excluded from the operation of TIA ss. 310(b)(1) any indenture or
indentures  under which other  securities of the Issuer are  outstanding  if the
requirements for such exclusion set forth in TIA ss. 310(b)(1) are met.

      Within 90 days after  ascertaining  the  occurrence of an Event of Default
which shall not have been cured or waived,  unless  authorized by the Securities
and Exchange Commission,  the

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<PAGE>

Indenture  Trustee  shall resign with respect to one or more Classes of Notes in
accordance with Section 6.08 of this  Indenture,  and the Issuer shall appoint a
successor Indenture Trustee for such Classes. In the event the Indenture Trustee
fails to comply with the terms of the preceding sentence,  the Indenture Trustee
shall comply with clause (ii) of TIA ss. 310(b).

      In the case of the appointment  hereunder of a successor Indenture Trustee
with respect to any Class of Notes  pursuant to this Section  6.11,  the Issuer,
the retiring Indenture Trustee and the successor  Indenture Trustee with respect
to such Class of Notes  shall  execute  and  deliver an  indenture  supplemental
hereto wherein each successor  Indenture  Trustee shall accept such  appointment
and which (i) shall  contain such  provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, the successor  Indenture Trustee all
the rights,  powers,  trusts and duties of the retiring  Indenture  Trustee with
respect  to the Notes of the Class to which the  appointment  of such  successor
Indenture  Trustee  relates,  (ii)  if the  retiring  Indenture  Trustee  is not
retiring with respect to all Classes of Notes,  shall contain such provisions as
shall be deemed  necessary or desirable to confirm that all the rights,  powers,
trusts and duties of the retiring Indenture Trustee with respect to the Notes of
each Class as to which the  retiring  Indenture  Trustee is not  retiring  shall
continue to be vested in the Indenture Trustee, and (iii) shall add to or change
any of the  provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Indenture
Trustee,  it  being  understood  that  nothing  herein  or in such  supplemental
indenture shall constitute such Indenture Trustees co-trustees of the same trust
and that each  such  Indenture  Trustee  shall be  trustee  of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder  administered by
any other such Indenture Trustee; and upon the removal of the retiring Indenture
Trustee shall become effective to the extent provided therein.

      Section  6.12.  Preferential  Collection  of Claims  Against  Issuer.  The
Indenture  Trustee  shall  comply with TIA ss.  311(a),  excluding  any creditor
relationship  listed in TIA ss. 311(b). An Indenture Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated.

      Section 6.13. Representations and Warranties. The Indenture Trustee hereby
represents that:

            (i) The Indenture  Trustee is a banking  association duly organized,
      validly  existing and in good standing under the laws of the United States
      with power and authority to own its properties and to conduct its business
      as such  properties  are  currently  owned and such  business is presently
      conducted.

            (ii) The  Indenture  Trustee has the power and  authority to execute
      and deliver this Indenture and to carry out its terms;  and the execution,
      delivery and  performance of this  Indenture have been duly  authorized by
      the Indenture Trustee by all necessary corporate action.

            (iii) The  consummation  of the  transactions  contemplated  by this
      Indenture and the  fulfillment  of the terms hereof do not conflict  with,
      result in any breach of any of the terms and  provisions of, or constitute
      (with or without notice or lapse of time) a default

                                       39
<PAGE>

      under, the articles of organization or bylaws of the Indenture  Trustee or
      any  agreement or other  instrument  to which the  Indenture  Trustee is a
      party or by which it is bound.

            (iv)  To  the  Indenture  Trustee's  best  knowledge,  there  are no
      proceedings  or  investigations  pending or  threatened  before any court,
      regulatory   body,    administrative    agency   or   other   governmental
      instrumentality  having  jurisdiction  over the  Indenture  Trustee or its
      properties:  (A) asserting the invalidity of this Indenture (B) seeking to
      prevent the consummation of any of the  transactions  contemplated by this
      Indenture or (C) seeking any determination or ruling that might materially
      and  adversely  affect the  performance  by the  Indenture  Trustee of its
      obligations under, or the validity or enforceability of, this Indenture.

            (v) The Indenture  Trustee does not have notice of any adverse claim
      (as such terms are used in Delaware UCC Section 8-302) with respect to the
      Home Loans.

      Section 6.14.  Directions to Indenture  Trustee.  The Indenture Trustee is
hereby directed:

            (a) to accept  the  pledge of the Home  Loans and hold the assets of
      the Trust in trust for the Noteholders and the Credit Enhancer;

            (b) to authenticate and deliver the Notes  substantially in the form
      prescribed  by Exhibits A-1 and A-2 in  accordance  with the terms of this
      Indenture;

            (c) on the  Closing  Date,  to  enter  into the  Credit  Enhancement
      Instrument for the benefit of the Noteholders with the Credit Enhancer;

            (d) to execute the other Basic Documents to which it is a party; and

            (e) to take all other  actions as shall be  required  to be taken by
      the terms of this Indenture.

      Section 6.15. Indenture Trustee May Own Securities. The Indenture Trustee,
in its  individual  or any other  capacity  may  become  the owner or pledgee of
Securities with the same rights it would have if it were not Indenture Trustee.

                                  ARTICLE VII

                         NOTEHOLDERS' LISTS AND REPORTS

      Section 7.01.  Issuer to Furnish  Indenture Trustee Names and Addresses of
Noteholders.  The Issuer will furnish or cause to be furnished to the  Indenture
Trustee (a) not more than five days after each Record Date, a list, in such form
as the Indenture Trustee may reasonably  require,  of the names and addresses of
the Holders of Notes as of such Record Date and,  (b) at such other times as the
Indenture Trustee and the Credit Enhancer may request in writing, within 30 days
after  receipt by the  Issuer of any such  request,  a list of similar  form and
content  as of a date not more  than 10 days  prior  to the  time  such  list is
furnished;  provided, however, that so long as the Indenture Trustee is the Note
Registrar, no such list shall be required to be furnished.

                                       40
<PAGE>

      Section 7.02. Preservation of Information;  Communications to Noteholders.
(a) The Indenture Trustee shall preserve,  in as current a form as is reasonably
practicable,  the names and  addresses of the Holders of Notes  contained in the
most recent list furnished to the Indenture  Trustee as provided in Section 7.01
and the names and  addresses  of  Holders  of Notes  received  by the  Indenture
Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy any
list furnished to it as provided in such Section 7.01 upon receipt of a new list
so furnished.

      (b)  Noteholders  may  communicate  pursuant to TIA ss.  312(b) with other
Noteholders  with  respect to their  rights  under this  Indenture  or under the
Notes.

      (c) The Issuer,  the Indenture  Trustee and the Note Registrar  shall have
the protection of TIA ss. 312(c).

      Section 7.03. Reports by Issuer. (a) The Issuer shall:

            (i) file with the Indenture Trustee, within 15 days after the Issuer
      is  required  to file the same with the  Commission,  copies of the annual
      reports and the  information,  documents  and other  reports (or copies of
      such portions of any of the foregoing as the  Commission  may from time to
      time by rules and  regulations  prescribe) that the Issuer may be required
      to file  with  the  Commission  pursuant  to  Section  13 or  15(d) of the
      Exchange Act;

            (ii)  file  with  the  Indenture  Trustee,  and  the  Commission  in
      accordance with rules and regulations  prescribed from time to time by the
      Commission such additional information, documents and reports with respect
      to  compliance  by the Issuer with the  conditions  and  covenants of this
      Indenture  as may be  required  from  time  to  time  by  such  rules  and
      regulations; and

            (iii) supply to the  Indenture  Trustee (and the  Indenture  Trustee
      shall  transmit by mail to all  Noteholders  described in TIA ss.  313(c))
      such summaries of any  information,  documents and reports  required to be
      filed by the  Issuer  pursuant  to  clauses  (i) and (ii) of this  Section
      7.03(a) and by rules and  regulations  prescribed from time to time by the
      Commission.

      (b) Unless the Issuer otherwise determines,  the fiscal year of the Issuer
shall end on December 31 of each year.

      Section 7.04. Reports by Indenture Trustee. If required by TIA ss. 313(a),
within 60 days  after  each  January 1  beginning  with  January  1,  2007,  the
Indenture  Trustee  shall mail to each  Noteholder as required by TIA ss. 313(c)
and to the Credit  Enhancer a brief report  dated as of such date that  complies
with TIA ss.  313(a).  The  Indenture  Trustee  also shall  comply  with TIA ss.
313(b). A copy of each report at the time of its mailing to Noteholders shall be
filed by the Indenture  Trustee with the Commission and each stock exchange,  if
any,  on which the Notes are  listed.  The Issuer  shall  notify  the  Indenture
Trustee if and when the Notes are listed on any stock exchange.

      Section 7.05.  Exchange Act Reporting.  In connection with the preparation
and filing of periodic  reports by the Master Servicer  pursuant to Section 4.04
of the Servicing  Agreement,  the

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<PAGE>

Indenture  Trustee  shall  timely  provide to the Master  Servicer (I) a list of
Holders as shown on the Note Register or  Certificate  Register as of the end of
each calendar year,  (II) copies of all  pleadings,  other legal process and any
other  documents  relating to any claims,  charges or  complaints  involving the
Indenture Trustee, as indenture trustee hereunder,  or the Trust Estate that are
received by the  Indenture  Trustee,  (III) notice of all matters  that,  to the
actual knowledge of a Responsible  Officer of the Indenture  Trustee,  have been
submitted  to a vote of the  Holders,  other than those  matters  that have been
submitted to a vote of the Holders at the request of the Depositor or the Master
Servicer,  and (IV) notice of any failure of the  Indenture  Trustee to make any
payment to the  Holders as  required  pursuant  to this  Indenture.  Neither the
Master Servicer nor the Indenture  Trustee shall have any liability with respect
to the Master  Servicer's  failure  to  properly  prepare or file such  periodic
reports resulting from or relating to the Master Servicer's inability or failure
to  obtain  any  information  not  resulting  from  the  Master  Servicer's  own
negligence or willful misconduct.

                                  ARTICLE VIII

                      ACCOUNTS, DISBURSEMENTS AND RELEASES

      Section 8.01.  Collection of Money. Except as otherwise expressly provided
herein,  the  Indenture  Trustee may demand  payment or  delivery  of, and shall
receive and collect,  directly and without  intervention  or  assistance  of any
fiscal agent or other  intermediary,  all money and other property payable to or
receivable by the Indenture  Trustee  pursuant to this Indenture.  The Indenture
Trustee shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture,  if any default occurs
in the making of any payment or  performance  under any  agreement or instrument
that is part of the Trust Estate,  the Indenture Trustee may take such action as
may be  appropriate  to enforce  such  payment  or  performance,  including  the
institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.

      Section 8.02.  Trust  Accounts.  (a) On or prior to the Closing Date,  the
Issuer shall cause the Indenture Trustee to establish and maintain,  in the name
of the Indenture Trustee, for the benefit of the Noteholders and the Certificate
Paying Agent, on behalf of the  Certificateholder  and the Credit Enhancer,  the
Payment Account as provided in Section 3.01 of this Indenture.

      (b) All monies deposited from time to time in the Payment Account pursuant
to the Servicing  Agreement and all deposits  therein pursuant to this Indenture
are for the benefit of the  Noteholders  and the  Certificate  Paying Agent,  on
behalf of the  Certificateholder  and all  investments  made  with  such  monies
including all income or other gain from such  investments are for the benefit of
the Master Servicer as provided by the Servicing Agreement.

      On each Payment Date, the Indenture  Trustee shall  distribute all amounts
on deposit in the Payment  Account to Noteholders in respect of the Notes and in
its capacity as Certificate Paying Agent to the  Certificateholder  in the order
of priority set forth in Section  3.05 (except as otherwise  provided in Section
5.04(b)).

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<PAGE>

      The  Master  Servicer  shall  direct the  Indenture  Trustee in writing to
invest any funds in the Payment  Account in  Permitted  Investments  maturing no
later than the Business Day preceding each Payment Date and shall not be sold or
disposed of prior to the maturity.

      Section 8.03. Officer's  Certificate.  The Indenture Trustee shall receive
at least  seven  days  notice  when  requested  by the Issuer to take any action
pursuant to Section  8.05(a),  accompanied  by copies of any  instruments  to be
executed,  and the Indenture Trustee shall also require,  as a condition to such
action,  an Officer's  Certificate,  in form and substance  satisfactory  to the
Indenture  Trustee,  stating the legal effect of any such action,  outlining the
steps  required  to  complete  the  same,  and  concluding  that all  conditions
precedent to the taking of such action have been complied with.

      Section 8.04. Termination Upon Payment to Noteholders.  This Indenture and
the respective  obligations and responsibilities of the Issuer and the Indenture
Trustee created hereby shall terminate upon the payment to the Noteholders,  the
Certificate  Paying  Agent (on  behalf  of the  Certificateholder),  the  Credit
Enhancer and the Indenture  Trustee of all amounts  required to be paid pursuant
to Article  III;  provided,  however,  that in no event shall the trust  created
hereby continue beyond the expiration of 21 years from the death of the 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.

      Section 8.05.  Release of Trust Estate.  (a) Subject to the payment of its
fees  and  expenses,  the  Indenture  Trustee  may,  and  when  required  by the
provisions of this Indenture shall, execute instruments to release property from
the lien of this Indenture,  or convey the Indenture  Trustee's  interest in the
same, in a manner and under  circumstances  that are not  inconsistent  with the
provisions of this  Indenture.  No party relying upon an instrument  executed by
the Indenture  Trustee as provided in Article VIII  hereunder  shall be bound to
ascertain the Indenture  Trustee's  authority,  inquire into the satisfaction of
any conditions precedent, or see to the application of any monies.

      (b) The Indenture  Trustee  shall,  at such time as (i) there are no Notes
Outstanding,  (ii) all sums due the Indenture Trustee pursuant to this Indenture
and other  Basic  Documents  have  been  paid and (iii) all sums due the  Credit
Enhancer have been paid,  release any remaining portion of the Trust Estate that
secured the Notes from the lien of this Indenture.

      (c) The Indenture  Trustee  shall  release  property from the lien of this
Indenture  pursuant to this Section 8.05 only upon receipt of a request from the
Issuer  accompanied  by an  Officers'  Certificate  and a letter from the Credit
Enhancer, stating that the Credit Enhancer has no objection to such request from
the Issuer.

      (d) The  Indenture  Trustee  shall,  at the  request  of the Issuer or the
Depositor,  surrender the Credit  Enhancement  Instrument to the Credit Enhancer
for cancellation, upon final payment on the Notes.

      Section 8.06.  Surrender of Notes Upon Final Payment. By acceptance of any
Note, the Holder thereof agrees to surrender such Note to the Indenture  Trustee
promptly, prior to such Noteholder's receipt of the final payment thereon.

                                       43
<PAGE>

                                   ARTICLE IX

                             SUPPLEMENTAL INDENTURES

      Section 9.01. Supplemental Indentures Without Consent of Noteholders.  (a)
Without  the  consent of the  Holders of any Notes but with prior  notice to the
Rating  Agencies and the written  consent of the Credit  Enhancer (which consent
shall  not be  unreasonably  withheld),  unless a Credit  Enhancer  Default  has
occurred  and  is  continuing,  the  Issuer  and  the  Indenture  Trustee,  when
authorized by an Issuer  Request,  at any time and from time to time,  may enter
into one or more  indentures  supplemental  hereto  (which shall  conform to the
provisions  of the Trust  Indenture Act as in force at the date of the execution
thereof),  in  form  satisfactory  to  the  Indenture  Trustee,  for  any of the
following purposes:

            (i) to correct or amplify  the  description  of any  property at any
      time subject to the lien of this  Indenture,  or better to assure,  convey
      and confirm unto the Indenture Trustee any property subject or required to
      be subjected to the lien of this  Indenture,  or to subject to the lien of
      this Indenture additional property;

            (ii) to evidence the  succession,  in compliance with the applicable
      provisions  hereof, of another person to the Issuer, and the assumption by
      any such  successor of the covenants of the Issuer herein and in the Notes
      contained;

            (iii) to add to the covenants of the Issuer,  for the benefit of the
      Holders of the Notes or the Credit Enhancer,  or to surrender any right or
      power herein conferred upon the Issuer;

            (iv) to convey, transfer, assign, mortgage or pledge any property to
      or with the Indenture Trustee;

            (v) to cure any  ambiguity,  to correct any error,  or to correct or
      supplement any provision herein or in any supplemental  indenture that may
      be  inconsistent  with any other  provision  herein,  in any  supplemental
      indenture or in the Prospectus Supplement;

            (vi) to make  any  other  provisions  with  respect  to  matters  or
      questions  arising under this Indenture or in any supplemental  indenture;
      provided,  that such action shall not materially and adversely  affect the
      interests of the Holders of the Notes or the Credit Enhancer;

            (vii) to evidence and provide for the acceptance of the  appointment
      hereunder  by a successor  trustee with respect to the Notes and to add to
      or change any of the provisions of this Indenture as shall be necessary to
      facilitate  the  administration  of the trusts  hereunder by more than one
      trustee, pursuant to the requirements of Article VI; or

            (viii)  to  modify,  eliminate  or  add to the  provisions  of  this
      Indenture to such extent as shall be necessary to effect the qualification
      of this  Indenture  under the TIA or under  any  similar  federal  statute
      hereafter  enacted and to add to this Indenture  such other  provisions as
      may be expressly required by the TIA;

                                       44
<PAGE>

      provided,  however,  that no such indenture  supplements  shall be entered
      into  unless  the  Indenture  Trustee  shall have  received  an Opinion of
      Counsel that entering  into such  indenture  supplement  will not have any
      material  adverse  tax  consequences  to the  Noteholders.  The  Indenture
      Trustee  is  hereby  authorized  to  join  in the  execution  of any  such
      supplemental  indenture and to make any further appropriate agreements and
      stipulations that may be therein contained.

      (b) The Issuer and the  Indenture  Trustee,  when  authorized by an Issuer
Request,  may, also without the consent of any of the Holders of the Notes,  but
with prior  notice to the  Rating  Agencies  and with the  consent of the Credit
Enhancer (so long as no Credit Enhancer Default exists), enter into an indenture
or indentures  supplemental  hereto for the purpose of adding any provisions to,
or  changing  in any  manner  or  eliminating  any of the  provisions  of,  this
Indenture  or of  modifying in any manner the rights of the Holders of the Notes
under  this  Indenture;  provided,  however,  that such  action  shall  not,  as
evidenced  by an Opinion of Counsel (a copy of which shall be  delivered  to the
Credit Enhancer),  (i) adversely affect in any material respect the interests of
any Noteholder or the Credit  Enhancer or (ii) cause the Issuer to be subject to
an entity level tax.

      (c) The Issuer and the Indenture Trustee shall, as directed by the Holders
of Certificates which represent not less than 100% of the Certificate Percentage
Interests thereof, enter into an indenture or indentures supplemental hereto for
the purpose of providing for the issuance of one or more  additional  classes of
Notes entitled to payments  derived solely from all or a portion of the payments
to which  the  Certificate  issued on the  Closing  Date  pursuant  to the Trust
Agreement  are  entitled;  provided,  however,  that such  action  shall not, as
evidenced  by an Opinion of Counsel (a copy of which shall be  delivered  to the
Credit Enhancer),  (i) adversely affect in any material respect the interests of
any Noteholder or the Credit  Enhancer or (ii) cause the Issuer to be subject to
an entity level tax. Each such class of Notes shall be a non-recourse obligation
of the Issuer and shall be entitled to interest and  principal in such  amounts,
and to such  security for the repayment  thereof,  as shall be specified in such
amendment  or  amendments.  Promptly  after the  execution by the Issuer and the
Indenture Trustee of any amendments  pursuant to this Section or the creation of
a new indenture  and the issuance of the related class or classes of Notes,  the
Issuer shall require the Indenture  Trustee to give notice to the Holders of the
Notes and the Rating  Agencies  setting  forth in general terms the substance of
the  provisions  of such  amendment.  Any  failure of the  Indenture  Trustee to
provide such notice as is required under this paragraph,  or any defect therein,
shall not,  however,  in any way impair or affect the validity of such amendment
or any class of Notes issued pursuant thereto. Unless the Credit Enhancer agrees
in writing, (i) any classes of Notes issued pursuant to a supplemental indenture
shall not be  entitled  to the  insurance  provided  by the  Credit  Enhancement
Instrument  and (ii) the Holders of any such  classes of Notes shall be entitled
only to such  distributions  or a portion of such  distributions  as the Holders
would have received as Holder of Certificate.

      Section 9.02.  Supplemental  Indentures With Consent of  Noteholders.  The
Issuer and the Indenture  Trustee,  when authorized by an Issuer  Request,  also
may,  with  prior  notice to the  Rating  Agencies  and with the  consent of the
Holders of not less than a majority of the  aggregate  Note Balance of the Notes
affected  thereby and the Credit Enhancer (so long as no Credit Enhancer Default
exists),  by Act (as defined in Section 10.03 hereof) of such Holders  delivered
to the Issuer and the Indenture  Trustee,  enter into an indenture or indentures
supplemental  hereto

                                       45
<PAGE>

for the  purpose  of adding  any  provisions  to, or  changing  in any manner or
eliminating  any of the  provisions  of, this  Indenture  or of modifying in any
manner the rights of the  Holders of the Notes under this  Indenture;  provided,
however,  that no such supplemental  indenture shall, without the consent of the
Holder of each Note affected thereby:

            (i) change the date of payment of any installment of principal of or
      interest  on any Note,  or reduce  the  principal  amount  thereof  or the
      interest rate thereon, change the provisions of this Indenture relating to
      the  application  of  collections  on, or the proceeds of the Sale of, the
      Trust  Estate to payment of  principal  of or  interest  on the Notes,  or
      change any place of payment where,  or the coin or currency in which,  any
      Note or the interest thereon is payable,  or impair the right to institute
      suit for the enforcement of the provisions of this Indenture requiring the
      application of funds available therefor,  as provided in Article V, to the
      payment of any such amount due on the Notes on or after the respective due
      dates thereof;

            (ii) reduce the  percentage of the related Note Balance of any Class
      of Notes,  the consent of the  Holders of which is  required  for any such
      supplemental indenture, or the consent of the Holders of which is required
      for any waiver of compliance with certain  provisions of this Indenture or
      certain  defaults  hereunder and their  consequences  provided for in this
      Indenture;

            (iii)  modify  or  alter  the  provisions  of  the  proviso  to  the
      definition of the term  "Outstanding"  or modify or alter the exception in
      the definition of the term "Holder";

            (iv) reduce the  percentage  of the  aggregate  Note  Balance of the
      Notes  required  to direct the  Indenture  Trustee to direct the Issuer to
      sell or liquidate the Trust Estate pursuant to Section 5.04;

            (v) modify any provision of this Section 9.02 except to increase any
      percentage   specified  herein  or  to  provide  that  certain  additional
      provisions of this Indenture or the Basic Documents  cannot be modified or
      waived without the consent of the Holder of each Note affected thereby;

            (vi) modify any of the  provisions of this  Indenture in such manner
      as to affect the  calculation  of the amount of any payment of interest or
      principal due on any Note on any Payment Date  (including the  calculation
      of any of the individual components of such calculation); or

            (vii)  permit  the  creation  of any lien  ranking  prior to or on a
      parity  with the lien of this  Indenture  with  respect to any part of the
      Trust Estate or,  except as otherwise  permitted or  contemplated  herein,
      terminate  the lien of this  Indenture on any property at any time subject
      hereto or deprive the Holder of any Note of the  security  provided by the
      lien of this Indenture;

provided,  that such action  shall not, as  evidenced  by an Opinion of Counsel,
cause the  Issuer to be subject to an entity  level tax and  provided,  further,
that no such  indenture  supplements  shall be entered into unless the Indenture
Trustee  shall have  received  an Opinion of  Counsel  that  entering  into such
indenture  supplement  will not  adversely  affect in any  material  respect the

                                       46
<PAGE>

interests of the  Certificateholder  or shall have received the express  written
consent of the Certificateholder to the indenture supplement.

      The Indenture  Trustee may in its discretion  determine whether or not any
Notes would be affected by any supplemental indenture and any such determination
shall be  conclusive  upon the  Holders of all  Notes,  whether  theretofore  or
thereafter  authenticated and delivered  hereunder.  The Indenture Trustee shall
not be liable for any such determination made in good faith.

      It shall not be necessary  for any Act of  Noteholders  under this Section
9.02 to approve the particular form of any proposed supplemental indenture,  but
it shall be sufficient if such Act shall approve the substance thereof.

      Promptly  after the execution by the Issuer and the  Indenture  Trustee of
any supplemental  indenture pursuant to this Section 9.02, the Indenture Trustee
shall mail to the Holders of the Notes and the Custodian to which such amendment
or  supplemental  indenture  relates a notice setting forth in general terms the
substance of such supplemental  indenture.  Any failure of the Indenture Trustee
to mail such  notice,  or any defect  therein,  shall not,  however,  in any way
impair or affect the validity of any such supplemental indenture.

      Notwithstanding anything to the contrary herein, so long as there does not
exist a failure by the Credit  Enhancer  to make a  required  payment  under the
Credit  Enhancement  Instrument,  the  Credit  Enhancer  shall have the right to
exercise  all rights of the  Holders of the Notes under this  Indenture  and the
Servicing  Agreement  without any consent of such Holders,  and such Holders may
exercise such rights only with the prior written consent of the Credit Enhancer.

      Section 9.03.  Execution of  Supplemental  Indentures.  In  executing,  or
permitting  the  additional  trusts  created  by,  any  supplemental   indenture
permitted by this Article IX or the  modification  thereby of the trusts created
by this  Indenture,  the  Indenture  Trustee  shall be entitled to receive,  and
subject to Sections 6.01 and 6.02,  shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental  indenture is
authorized or permitted by this  Indenture and conforms to the  requirements  of
the Trust  Indenture Act. The Indenture  Trustee may, but shall not be obligated
to,  enter into any such  supplemental  indenture  that  affects  the  Indenture
Trustee's own rights, duties,  liabilities or immunities under this Indenture or
otherwise.

      Section 9.04. Effect of Supplemental Indenture.  Upon the execution of any
supplemental  indenture pursuant to the provisions hereof,  this Indenture shall
be and shall be deemed to be modified and amended in accordance  therewith  with
respect to the Notes affected thereby, and the respective rights, limitations of
rights, obligations,  duties, liabilities and immunities under this Indenture of
the Indenture Trustee,  the Issuer and the Holders of the Notes shall thereafter
be determined,  exercised and enforced hereunder subject in all respects to such
modifications  and  amendments,  and all the  terms and  conditions  of any such
supplemental  indenture  shall  be and be  deemed  to be part of the  terms  and
conditions of this Indenture for any and all purposes.

      Section 9.05. Conformity with Trust Indenture Act. Every amendment of this
Indenture and every supplemental  indenture executed pursuant to this Article IX
shall conform to the

                                       47
<PAGE>

requirements  of the  Trust  Indenture  Act as  then in  effect  so long as this
Indenture shall then be qualified under the Trust Indenture Act.

      Section  9.06.  Reference  in  Notes  to  Supplemental  Indentures.  Notes
authenticated  and delivered after the execution of any  supplemental  indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a  notation  in form  approved  by the  Indenture  Trustee as to any matter
provided  for in such  supplemental  indenture.  If the Issuer or the  Indenture
Trustee shall so determine,  new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental  indenture may
be prepared and executed by the Issuer and  authenticated  and  delivered by the
Indenture Trustee in exchange for Outstanding Notes.

                                   ARTICLE X

                                  MISCELLANEOUS

      Section 10.01.  Compliance  Certificates  and Opinions,  etc. (a) Upon any
application or request by the Issuer to the Indenture Trustee to take any action
under any provision of this Indenture, the Issuer shall furnish to the Indenture
Trustee and to the Credit Enhancer (i) an Officer's Certificate stating that all
conditions  precedent,  if any,  provided for in this Indenture  relating to the
proposed  action have been complied with and (ii) an Opinion of Counsel  stating
that in the opinion of such counsel all such conditions precedent,  if any, have
been complied with,  except that, in the case of any such application or request
as to which the  furnishing of such  documents is  specifically  required by any
provision  of this  Indenture,  no  additional  certificate  or opinion  need be
furnished.  Every  certificate  or opinion  with  respect to  compliance  with a
condition or covenant provided for in this Indenture shall include:

            (1) a statement that each  signatory of such  certificate or opinion
      has read or has  caused  to be read such  covenant  or  condition  and the
      definitions herein relating thereto;

            (2) a brief  statement as to the nature and scope of the examination
      or investigation  upon which the statements or opinions  contained in such
      certificate or opinion are based;

            (3) a statement  that, in the opinion of each such  signatory,  such
      signatory has made such  examination or  investigation  as is necessary to
      enable such signatory to express an informed  opinion as to whether or not
      such covenant or condition has been complied with;

            (4) a  statement  as  to  whether,  in  the  opinion  of  each  such
      signatory, such condition or covenant has been complied with; and

            (5) if the signer of such  certificate  or Opinion is required to be
      Independent,  the  statement  required  by  the  definition  of  the  term
      "Independent".

      (b) (i)  Prior to the  deposit  of any  Collateral  or other  property  or
securities  with the  Indenture  Trustee  that is to be made the  basis  for the
release of any property or securities

                                       48
<PAGE>

subject to the lien of this  Indenture,  the Issuer  shall,  in  addition to any
obligation  imposed in Section 10.01(a) or elsewhere in this Indenture,  furnish
to the  Indenture  Trustee an Officer's  Certificate  certifying  or stating the
opinion of each person signing such  certificate as to the fair value (within 90
days of such  deposit)  to the Issuer of the  Collateral  or other  property  or
securities to be so deposited.

      (ii) Whenever the Issuer is required to furnish to the  Indenture  Trustee
an Officer's Certificate certifying or stating the opinion of any signer thereof
as to the matters  described in clause (i) above,  the Issuer shall also deliver
to the Indenture Trustee an Independent  Certificate as to the same matters,  if
the fair value to the Issuer of the  securities  to be so  deposited  and of all
other such securities made the basis of any such withdrawal or release since the
commencement of the then current fiscal year of the Issuer,  as set forth in the
certificates delivered pursuant to clause (i) above and this clause (ii), is 10%
or more of the aggregate Note Balance of the Notes,  but such a certificate need
not be furnished with respect to any securities so deposited,  if the fair value
thereof to the Issuer as set forth in the related Officer's  Certificate is less
than  $25,000 or less than one  percent  of the  aggregate  Note  Balance of the
Notes.

      (iii) Whenever any property or securities are to be released from the lien
of this  Indenture,  the Issuer shall also furnish to the  Indenture  Trustee an
Officer's  Certificate  certifying or stating the opinion of each person signing
such  certificate  as to the fair value  (within 90 days of such release) of the
property or  securities  proposed to be released and stating that in the opinion
of such person the  proposed  release  will not impair the  security  under this
Indenture in contravention of the provisions hereof.

      (iv) Whenever the Issuer is required to furnish to the  Indenture  Trustee
an Officer's Certificate certifying or stating the opinion of any signer thereof
as to the matters described in clause (iii) above, the Issuer shall also furnish
to the Indenture  Trustee an  Independent  Certificate as to the same matters if
the fair value of the property or securities  and of all other  property,  other
than property as  contemplated  by clause (v) below or securities  released from
the lien of this Indenture since the  commencement of the then current  calendar
year, as set forth in the  certificates  required by clause (iii) above and this
clause (iv),  equals 10% or more of the aggregate Note Balance of the Notes, but
such certificate need not be furnished in the case of any release of property or
securities  if the fair  value  thereof  as set forth in the  related  Officer's
Certificate  is less than $25,000 or less than one percent of the then aggregate
Note Balance of the Notes.

      (v)  Notwithstanding  any  provision  of this  Indenture,  the Issuer may,
without compliance with the requirements of the other provisions of this Section
10.01,  (A) collect,  sell or otherwise  dispose of the Home Loans as and to the
extent  permitted or required by the Basic  Documents or (B) make cash  payments
out of the  Payment  Account as and to the extent  permitted  or required by the
Basic  Documents,  so long as the Issuer shall deliver to the Indenture  Trustee
every six months,  commencing  six months after the closing  date,  an Officer's
Certificate  of the  Issuer  stating  that all the  dispositions  of  Collateral
described in clauses (A) or (B) above that  occurred  during the  preceding  six
calendar  months were in the ordinary  course of the Issuer's  business and that
the proceeds thereof were applied in accordance with the Basic Documents.

                                       49
<PAGE>

      Section 10.02. Form of Documents  Delivered to Indenture  Trustee.  In any
case where  several  matters are required to be  certified  by, or covered by an
opinion of, any specified  Person,  it is not necessary that all such matters be
certified  by, or covered by the opinion of, only one such Person,  or that they
be so certified or covered by only one document, but one such Person may certify
or give an  opinion  with  respect  to some  matters  and one or more other such
Persons as to other matters,  and any such Person may certify or give an opinion
as to such matters in one or several documents.

      Any  certificate or opinion of an Authorized  Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or  representations
with respect to the matters upon which his  certificate  or opinion is based are
erroneous.  Any such certificate of an Authorized  Officer or Opinion of Counsel
may be based,  insofar as it relates to factual  matters,  upon a certificate or
opinion of, or  representations  by, an officer or officers of the Seller or the
Issuer,  stating that the information with respect to such factual matters is in
the possession of the Seller or the Issuer, unless such counsel knows, or in the
exercise of  reasonable  care should know,  that the  certificate  or opinion or
representations with respect to such matters are erroneous.

      Where  any  Person  is  required  to  make,  give or  execute  two or more
applications,  requests, consents,  certificates,  statements, opinions or other
instruments  under this Indenture,  they may, but need not, be consolidated  and
form one instrument.

      Whenever  in  this  Indenture,  in  connection  with  any  application  or
certificate or report to the Indenture  Trustee,  it is provided that the Issuer
shall  deliver any document as a condition of the granting of such  application,
or as evidence of the Issuer's  compliance with any term hereof,  it is intended
that the truth and accuracy,  at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and  opinions  stated in such  document  shall in such case be  conditions
precedent to the right of the Issuer to have such application  granted or to the
sufficiency of such certificate or report. The foregoing shall not, however,  be
construed  to affect the  Indenture  Trustee's  right to rely upon the truth and
accuracy of any statement or opinion  contained in any such document as provided
in Article VI.

      Section   10.03.   Acts  of   Noteholders.   (a)  Any   request,   demand,
authorization,  direction,  notice,  consent, waiver or other action provided by
this  Indenture  to be  given or taken by  Noteholders  may be  embodied  in and
evidenced by one or more  instruments of  substantially  similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee,  and, where it
is hereby expressly required, to the Issuer. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act" of the Noteholders signing such instrument or instruments. Proof
of execution of any such  instrument or of a writing  appointing  any such agent
shall be  sufficient  for any purpose of this  Indenture and (subject to Section
6.01)  conclusive in favor of the Indenture  Trustee and the Issuer,  if made in
the manner provided in this Section 10.03.

                                       50
<PAGE>

      (b)  The  fact  and  date  of the  execution  by any  person  of any  such
instrument  or writing  may be proved in any manner that the  Indenture  Trustee
deems sufficient.

      (c) The ownership of Notes shall be proved by the Note Registrar.

      (d) Any request, demand, authorization, direction, notice, consent, waiver
or other  action by the Holder of any Notes  shall bind the Holder of every Note
issued upon the registration thereof or in exchange therefor or in lieu thereof,
in respect of anything  done,  omitted or  suffered to be done by the  Indenture
Trustee or the Issuer in  reliance  thereon,  whether  or not  notation  of such
action is made upon such Note.

      Section  10.04.  Notices,  etc.,  to  Indenture  Trustee,  Issuer,  Credit
Enhancer and Rating Agencies.  Any request,  demand,  authorization,  direction,
notice,  consent,  waiver or Act of Noteholders or other  documents  provided or
permitted by this  Indenture  shall be in writing and if such  request,  demand,
authorization, direction, notice, consent, waiver or Act of Noteholders is to be
made upon, given or furnished to or filed with:

            (i) the Indenture  Trustee by any  Noteholder or by the Issuer shall
      be sufficient  for every purpose  hereunder if made,  given,  furnished or
      filed in writing to or with the Indenture  Trustee at the Corporate  Trust
      Office.  The Indenture Trustee shall promptly transmit any notice received
      by it from the Noteholders to the Issuer,

            (ii) the Issuer by the Indenture  Trustee or by any Noteholder shall
      be sufficient  for every purpose  hereunder if in writing and mailed first
      class,  postage  prepaid  to the  Issuer  addressed  to:  Home Loan  Trust
      200[_]-[___],  in  care  of  [_____________],  or  at  any  other  address
      previously  furnished in writing to the  Indenture  Trustee by the Issuer.
      The Issuer  shall  promptly  transmit  any notice  received by it from the
      Noteholders to the Indenture Trustee, or

            (iii) [the Credit Enhancer by the Issuer,  the Indenture  Trustee or
      by any Noteholders  shall be sufficient for every purpose  hereunder to in
      writing and mailed, first class postage pre-paid,  or personally delivered
      or telecopied  to:  [_____________],  telecopier  number  [_____________],
      confirmation  number  [_____________].  The Credit Enhancer shall promptly
      transmit any notice received by it from the Issuer,  the Indenture Trustee
      or the  Noteholders  to the Issuer or Indenture  Trustee,  as the case may
      be].

      Notices  required to be given to the Rating  Agencies  by the Issuer,  the
Indenture Trustee or the Owner Trustee shall be in writing, personally delivered
or mailed by certified mail,  return receipt  requested,  to (i) [in the case of
Moody's,  at  the  following  address:  Moody's  Investors  Service,  Inc.,  ABS
Monitoring  Department,  99 Church Street,  New York, New York 10007 and (ii) in
the case of Standard & Poor's,  at the following  address:  Standard & Poor's, a
Division of the McGraw Hill Companies,  Inc., 55 Water Street],  41st Floor, New
York, New York 10041, Attention of Asset Backed Surveillance  Department;  or as
to each of the  foregoing,  at such  other  address  as shall be  designated  by
written notice to the other parties.

      Section  10.05.  Notices to  Noteholders;  Waiver.  Where  this  Indenture
provides  for  notice  to  Noteholders  of  any  event,  such  notice  shall  be
sufficiently  given (unless  otherwise herein expressly  provided) if in writing
and mailed,  first class,  postage prepaid to each  Noteholder

                                       51
<PAGE>

affected  by such  event,  at such  Person's  address  as it appears on the Note
Register,  not later than the latest  date,  and not earlier  than the  earliest
date,  prescribed  for the giving of such  notice.  In any case where  notice to
Noteholders  is given by mail,  neither  the failure to mail such notice nor any
defect in any notice so mailed to any  particular  Noteholder  shall  affect the
sufficiency  of such notice with  respect to other  Noteholders,  and any notice
that is mailed in the manner herein  provided shall  conclusively be presumed to
have been duly given  regardless  of  whether  such  notice is in fact  actually
received.

      Where this Indenture provides for notice in any manner, such notice may be
waived in writing by any Person  entitled to receive such notice,  either before
or after the event,  and such waiver  shall be the  equivalent  of such  notice.
Waivers of notice by Noteholders  shall be filed with the Indenture  Trustee but
such filing  shall not be a condition  precedent  to the  validity of any action
taken in reliance upon such a waiver.

      In case,  by reason of the  suspension of regular mail service as a result
of a strike, work stoppage or similar activity,  it shall be impractical to mail
notice of any event to  Noteholders  when such  notice is  required  to be given
pursuant  to any  provision  of this  Indenture,  then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a
sufficient giving of such notice.

      Where this Indenture  provides for notice to the Rating Agencies,  failure
to give such notice  shall not affect any other  rights or  obligations  created
hereunder, and shall not under any circumstance constitute an Event of Default.

      Section 10.06.  Alternate Payment and Notice  Provisions.  Notwithstanding
any provision of this Indenture or any of the Notes to the contrary,  the Issuer
may enter into any agreement with any Holder of a Note providing for a method of
payment,  or notice by the Indenture  Trustee to such Holder,  that is different
from the methods  provided for in this  Indenture  for such payments or notices.
The Issuer shall furnish to the Indenture  Trustee a copy of each such agreement
and the  Indenture  Trustee  shall  cause  payments to be made and notices to be
given in accordance with such agreements.

      Section 10.07.  Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required to
be included in this  Indenture by any of the  provisions of the Trust  Indenture
Act, such required  provision  shall control.  The provisions of TIA ss.ss.  310
through  317  that  impose  duties  on  any  Person  (including  the  provisions
automatically   deemed  included  herein  unless  expressly   excluded  by  this
Indenture)  are a part of and govern this  Indenture,  whether or not physically
contained herein.

      Section 10.08. Effect of Headings. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.

      Section  10.09.  Successors  and Assigns.  All covenants and agreements in
this  Indenture  and the  Notes by the  Issuer  shall  bind its  successors  and
assigns, whether so expressed or not. All agreements of the Indenture Trustee in
this Indenture shall bind its successors, co trustees and agents.

                                       52
<PAGE>

      Section 10.10. Separability. In case any provision in this Indenture or in
the Notes shall be invalid,  illegal or unenforceable,  the validity,  legality,
and enforceability of the remaining  provisions shall not in any way be affected
or impaired thereby.

      Section 10.11. Benefits of Indenture.  Nothing in this Indenture or in the
Notes,  express or  implied,  shall give to any  Person,  other than the parties
hereto and their successors hereunder, and the Noteholders,  the Credit Enhancer
and any other party  secured  hereunder,  and any other Person with an ownership
interest in any part of the Trust Estate,  any benefit or any legal or equitable
right,  remedy  or  claim  under  this  Indenture.  The  Credit  Enhancer  is  a
third-party beneficiary of this Indenture.

      Section  10.12.  Legal  Holidays.  In any case where the date on which any
payment  is due shall not be a Business  Day,  then  (notwithstanding  any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next  succeeding  Business  Day with the same  force  and
effect as if made on the date on which  nominally  due,  and no  interest  shall
accrue for the period from and after any such nominal date.

      Section  10.13.  GOVERNING  LAW.  THIS  INDENTURE  SHALL BE  CONSTRUED  IN
ACCORDANCE  WITH THE LAWS OF THE STATE OF NEW  YORK,  WITHOUT  REFERENCE  TO ITS
CONFLICTS OF LAW  PROVISIONS  (OTHER THAN SECTIONS  5-1401 AND 5-1402 OF THE NEW
YORK GENERAL  OBLIGATIONS LAW), AND THE OBLIGATIONS,  RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

      Section 10.14. Counterparts.  This Indenture may be executed in any number
of  counterparts,  each of which so executed  shall be deemed to be an original,
but all  such  counterparts  shall  together  constitute  but  one and the  same
instrument.

      Section  10.15.  Recording of Indenture.  If this  Indenture is subject to
recording in any appropriate public recording  offices,  such recording is to be
effected by the Issuer and at its expense  accompanied  by an Opinion of Counsel
(reasonably  acceptable to the Indenture Trustee and the Credit Enhancer) to the
effect  that such  recording  is  necessary  either  for the  protection  of the
Noteholders or any other Person secured  hereunder or for the enforcement of any
right or remedy granted to the Indenture Trustee under this Indenture.

      Section 10.16.  Issuer Obligation.  No recourse may be taken,  directly or
indirectly,  with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other  writing  delivered in connection  herewith or therewith,  against (i) the
Indenture  Trustee or the Owner  Trustee in its  individual  capacity,  (ii) any
owner of a  beneficial  interest  in the  Issuer  or (iii) any  partner,  owner,
beneficiary,  agent,  officer,  director,  employee  or agent  of the  Indenture
Trustee  or the  Owner  Trustee  in its  individual  capacity,  any  holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture  Trustee or the Owner Trustee in its
individual  capacity,  except as any such Person may have  expressly  agreed (it
being  understood that the Indenture  Trustee and the Owner Trustee have no such
obligations in their respective individual  capacities) and except that any such
partner,  owner or beneficiary  shall be fully liable, to the extent provided by
applicable  law,  for  any  unpaid   consideration  for  stock,

                                       53
<PAGE>

unpaid capital  contribution  or failure to pay any installment or call owing to
such  entity.  For all purposes of this  Indenture,  in the  performance  of any
duties or  obligations  of the  Issuer  hereunder,  the Owner  Trustee  shall be
subject  to,  and  entitled  to the  benefits  of, the terms and  provisions  of
Articles VI, VII and VIII of the Trust Agreement.

      Section 10.17. No Petition.  The Indenture Trustee,  by entering into this
Indenture, and each Noteholder, by its acceptance of a Note, hereby covenant and
agree that they will not at any time  institute  against  the  Depositor  or the
Issuer,  or join in any institution  against the Depositor or the Issuer of, any
bankruptcy, reorganization,  arrangement, insolvency or liquidation proceedings,
or other  proceedings  under any United  States  federal or state  bankruptcy or
similar law in  connection  with any  obligations  relating  to the Notes,  this
Indenture or any of the Basic Documents.

      Section  10.18.  Inspection.  The Issuer agrees that, on reasonable  prior
notice, it shall permit any representative of the Indenture Trustee,  during the
Issuer's normal  business  hours, to examine all the books of account,  records,
reports and other papers of the Issuer,  to make copies and extracts  therefrom,
to cause such books to be audited by Independent  certified public  accountants,
and to discuss the Issuer's  affairs,  finances  and accounts  with the Issuer's
officers,  employees, and Independent certified public accountants,  all at such
reasonable  times and as often as may be  reasonably  requested.  The  Indenture
Trustee shall and shall cause its representatives to hold in confidence all such
information  except to the extent  disclosure  may be  required  by law (and all
reasonable applications for confidential treatment are unavailing) and except to
the  extent  that the  Indenture  Trustee  may  reasonably  determine  that such
disclosure is consistent with its obligations hereunder.

                            [SIGNATURE PAGE FOLLOWS]

                                       54
<PAGE>

      IN WITNESS WHEREOF, the Issuer and the Indenture 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.

                                    HOME LOAN TRUST 200[_]-[___]
                                    as Issuer

                                         By: [_____________________________] not
                                             in its individual capacity but
                                             solely as Owner Trustee

                                    By:
                                    Name: ______________________________________
                                    Title:

                                    [______________________],
                                    as Indenture Trustee

                                    By:
                                    Name: ______________________________________
                                    Title:

[______________________]
hereby  accepts the  appointment as Paying Agent
pursuant to Section 3.03 hereof and as
Note Registrar pursuant to Section 4.02 hereof.

By: ____________________________________________
Name:
Title:

<PAGE>

STATE OF [___________])
                      ) ss.:
COUNTY OF[___________])

      On this  ____ day of  [________________],  20[__],  before  me  personally
appeared  [_____________________],  to me known, who being by me duly sworn, did
depose  and say that she is the  Vice  President  of the  Indenture  Trustee,  a
national  banking  association   described  in  and  which  executed  the  above
instrument; and that she signed her name thereto by like order.

                                  _______________________
                                  Notary Public

                                       2
<PAGE>

STATE OF [____________])
                       ) ss.:
COUNTY OF [___________])

      On this ____ day of  [_____________],  20[__],  before me, the undersigned
Notary Public of said State,  personally  appeared  ___________________________,
personally    known   to   me   to   be   a   duly    authorized    officer   of
[______________________]  that executed the within  instrument,  and  personally
known to me to be the person who  executed  the within  instrument  on behalf of
[______________________]   therein   named,   and   acknowledged   to  me   such
[______________________] executed the within instrument pursuant to its by-laws.

                                  _______________________
                                  Notary Public

                                       3
<PAGE>

STATE OF DELAWARE          )
                           ) ss.:
COUNTY OF NEW CASTLE       )

      On this  ____ day of  [________________],  20[__],  before  me  personally
appeared  ___________________,  to me  known,  who being by me duly  sworn,  did
depose and say that he/she resides at Wilmington,  Delaware,  that he/she is the
___________________  of  [_____________________],  as Owner Trustee,  a Delaware
banking  corporation  described in and which executed the above instrument;  and
that he/she signed his/her name thereto by like order.

                                  _______________________
                                  Notary Public

                                       4
<PAGE>

                                    EXHIBIT A

                                  FORM OF NOTES

                                CLASS A __ NOTES

      UNLESS  THIS NOTE IS  PRESENTED  BY AN  AUTHORIZED  REPRESENTATIVE  OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION  ("DTC"),  TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER,  EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY,  THE OUTSTANDING  PRINCIPAL  AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

      THIS NOTE DOES NOT  REPRESENT AN INTEREST IN OR  OBLIGATION OF THE SELLER,
THE DEPOSITOR,  THE MASTER SERVICER, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE OR
ANY  OF  THEIR  RESPECTIVE  AFFILIATES,  EXCEPT  AS  EXPRESSLY  PROVIDED  IN THE
INDENTURE OR THE BASIC DOCUMENTS.

      EACH  PURCHASER AND  TRANSFEREE  OF THIS NOTE,  BY ITS  ACCEPTANCE OF THIS
NOTE,  SHALL BE DEEMED TO HAVE  REPRESENTED  AND WARRANTED THAT EITHER (I) IT IS
NOT ACQUIRING THIS NOTE WITH THE ASSETS OF AN "EMPLOYEE BENEFIT PLAN" AS DEFINED
IN SECTION  3(3) OF THE EMPLOYEE  RETIREMENT  INCOME  SECURITY  ACT OF 1974,  AS
AMENDED  ("ERISA"),  WHICH IS SUBJECT TO THE  PROVISIONS OF TITLE I OF ERISA,  A
"PLAN" DESCRIBED IN SECTION  4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE"), AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY
REASON OF AN EMPLOYEE  BENEFIT PLAN'S OR OTHER PLAN'S  INVESTMENT IN SUCH ENTITY
OR ANY OTHER  PLAN THAT IS  SUBJECT TO A LAW THAT IS SIMILAR TO TITLE I OF ERISA
OR SECTION  4975 OF THE CODE OR (II) THE  ACQUISITION  AND  HOLDING OF THIS NOTE
WILL NOT GIVE RISE TO A NON-EXEMPT  PROHIBITED  TRANSACTION UNDER SECTION 406 OF
ERISA, SECTION 4975 OF THE CODE OR ANY SIMILAR APPLICABLE LAW.

                                      A-1
<PAGE>

                          HOME LOAN TRUST 200[_]-[___]

                              HOME LOAN-BACKED NOTE

Registered                                    Principal Amount: $___________

Class A __
No.  __                                       Percentage Interest: _____%

CUSIP No.  ___________                        Note Rate: [___%][Adjustable Rate]

      Home Loan  Trust  200[_]-[___],  a  statutory  trust  duly  organized  and
existing  under the laws of the State of  Delaware  (herein  referred  to as the
"Issuer"),  for  value  received,  hereby  promises  to  pay to  Cede  & Co.  or
registered assigns,  the principal sum of $___________,  payable on each Payment
Date in an  amount  equal  to the  Percentage  Interest  specified  above of the
aggregate  amount,  if any,  payable  from the  Payment  Account  in  respect of
principal  on the Class A-__ Notes  pursuant  to Section  3.05 of the  Indenture
dated as of  [__________________  ___],  20[___] (the  "Indenture")  between the
Issuer,  as Issuer,  and  [______________________],  as  Indenture  Trustee (the
"Indenture Trustee"); provided, however, that the entire unpaid principal amount
of this Note shall be due and payable on the Payment  Date in  [_______________]
20[___], to the extent not previously paid on a prior Payment Date.  Capitalized
terms used but not defined herein are defined in Appendix A of the Indenture.

      [Interest  on the Class A-__ Notes  will be paid  monthly on each  Payment
Date at the Note Rate. The Note Rate for the Class A-__ Notes will be _____% per
annum.  Interest  will be  computed on the basis of a 30 day month and a 360 day
year.  Principal  of and  interest  on this  Note  shall  be paid in the  manner
specified on the reverse hereof. On the Step Up Date, the Note Rate on the Class
A-__ Notes will increase by [0.50]% per annum.]

      [Interest on the Class A-1 Notes will be paid monthly on each Payment Date
at the Note Rate for the related Interest Accrual Period. The Note Rate for each
Interest  Accrual  Period will be equal to the lesser of (i) LIBOR  plus___% per
annum and (ii) ___% per annum. LIBOR for each applicable Interest Accrual Period
will be determined on the second LIBOR  Business Day  immediately  preceding (i)
the Closing Date in the case of the first  Interest  Accrual Period and (ii) the
first day of each succeeding Interest Accrual Period by the Indenture Trustee as
set forth in the Indenture. All determinations of LIBOR by the Indenture Trustee
shall,  in the absence of manifest  error,  be conclusive for all purposes,  and
each holder of this Class A-1 Note, by accepting this Class A-1 Note,  agrees to
be bound by such determination.  Interest on this Class A-1 Note will accrue for
each Payment Date from the most recent  Payment Date on which  interest has been
paid (in the case of the  first  Payment  Date,  from the  Closing  Date) to but
excluding  such  Payment  Date.  Interest  will be  computed on the basis of the
actual  number of days in each  Interest  Accrual  Period and a year  assumed to
consist of 360 days.  Principal  of and interest on this Class A-1 Note shall be
paid in the manner specified in the Indenture.]

      Principal  of and  interest  on this  Note  are  payable  in such  coin or
currency  of the  United  States of  America  as at the time of payment is legal
tender for payment of public and private debts.  All payments made by the Issuer
with respect to this Note shall be applied  first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.

                                      A-2
<PAGE>

      Reference is made to the further  provisions of this Note set forth on the
reverse  hereof,  which shall have the same effect as though  fully set forth on
the face of this Note.

      Unless the certificate of  authentication  hereon has been executed by the
Indenture Trustee whose name appears below by manual signature,  this Note shall
not be entitled to any benefit  under the  Indenture  referred to on the reverse
hereof, or be valid or obligatory for any purpose.

      This  Note is one of a duly  authorized  issue  of  Notes  of the  Issuer,
designated as its Home Loan-Backed Notes (herein called the "Notes"), all issued
under the Indenture,  to which Indenture and all indentures supplemental thereto
reference  is  hereby  made  for  a  statement  of  the  respective  rights  and
obligations  thereunder of the Issuer,  the Indenture Trustee and the holders of
the Notes. The Notes are subject to all terms of the Indenture.

      The Notes are and will be equally  and ratably  secured by the  Collateral
pledged as security therefor as provided in the Indenture.

      This Note is entitled to the benefits of an irrevocable and  unconditional
financial guaranty insurance policy issued by [___________________].

      Principal  of and  interest  on this Note will be payable on each  Payment
Date,  commencing on [_____________ ___], 20[__], as described in the Indenture.
"Payment Date" means the twenty fifth day of each month, or, if any such date is
not a Business Day, then the next Business Day.

      The entire unpaid  principal  amount of this Note shall be due and payable
in full on the Payment Date in  __________,  pursuant to the  Indenture,  to the
extent  not  previously  paid  on a  prior  Payment  Date.  Notwithstanding  the
foregoing,  if an Event of Default shall have occurred and be  continuing,  then
the  Indenture  Trustee  or the  holders of Notes  representing  not less than a
majority  of the  aggregate  Note  Balance of all Notes with the  consent of the
Credit Enhancer,  or the Credit Enhancer may declare the Notes to be immediately
due and payable in the manner  provided in Section  5.02 of the  Indenture.  All
principal  payments  on the Notes shall be paid in the manner and  priority  set
forth in Section 3.05 of the Indenture.

      Any installment of interest or principal, if any, payable on any Note that
is punctually paid or duly provided for by the Issuer on the applicable  Payment
Date shall,  if such Holder holds Notes of an aggregate  initial Note Balance of
at least  $1,000,000,  be paid to each Holder of record on the preceding  Record
Date,  by wire  transfer  to an account  specified  in  writing  by such  Holder
reasonably satisfactory to the Indenture Trustee as of the preceding Record Date
or in all other  cases or if no such  instructions  have been  delivered  to the
Indenture  Trustee,  by check or money order to such  Noteholder  mailed to such
Holder's  address as it appears in the Note  Register the amount  required to be
paid to such Holder on such Payment Date pursuant to such  Holder's  Securities;
provided,  however, that the Indenture Trustee shall not pay to such Holders any
amount required to be withheld from a payment to such Holder by the Code.

      As provided in the Indenture and subject to certain  limitations set forth
therein,  the transfer of this Note may be  registered on the Note Register upon
surrender  of this Note for  registration  of  transfer at the  Corporate  Trust
Office,  duly endorsed by, or accompanied by a written instrument of transfer in
form  satisfactory to the Indenture  Trustee duly executed by, the

                                      A-3
<PAGE>

holder hereof or such holder's  attorney duly  authorized in writing,  with such
signature  guaranteed  by  an  "eligible  guarantor   institution"  meeting  the
requirements of the Note Registrar,  which  requirements  include  membership or
participation in the Securities  Transfer Agent's Medallion Program ("STAMP") or
such  other  "signature  guarantee  program"  as may be  determined  by the Note
Registrar in addition to, or in substitution  for, STAMP, all in accordance with
the Securities  Exchange Act of 1934, as amended,  and thereupon one or more new
Notes in authorized  denominations  and in the same aggregate  principal  amount
will be issued to the designated  transferee or  transferees.  No service charge
will be charged for any  registration  of transfer or exchange of this Note, but
the Note Registrar shall require payment of a sum sufficient to cover any tax or
governmental  charge that may be imposed in connection with any  registration of
transfer or exchange of this Note.

      Each holder or Beneficial Owner of a Note, by acceptance of a Note, or, in
the case of a  Beneficial  Owner of a Note,  a  beneficial  interest  in a Note,
covenants and agrees that no recourse may be taken, directly or indirectly, with
respect to the  obligations of the Issuer,  the Owner Trustee,  the Seller,  the
Master  Servicer,  the Depositor or the Indenture  Trustee on the Notes or under
the  Indenture or any  certificate  or other  writing  delivered  in  connection
therewith,  against  (i) the  Indenture  Trustee  or the  Owner  Trustee  in its
individual  capacity,  (ii) any owner of a beneficial  interest in the Issuer or
(iii) any partner, owner,  beneficiary,  agent, officer, director or employee of
the  Indenture  Trustee or the Owner  Trustee in its  individual  capacity,  any
holder  of a  beneficial  interest  in the  Issuer,  the  Owner  Trustee  or the
Indenture  Trustee or of any successor or assign of the Indenture Trustee or the
Owner  Trustee in its  individual  capacity,  except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary shall be
fully  liable,  to  the  extent  provided  by  applicable  law  for  any  unpaid
consideration  for  stock,  unpaid  capital  contribution  or failure to pay any
installment or call owing to such entity.

      Each holder or Beneficial  Owner of a Note, by acceptance of a Note or, in
the case of a  Beneficial  Owner of a Note,  a  beneficial  interest  in a Note,
covenants and agrees by accepting the benefits of the Indenture that such holder
or  Beneficial  Owner  of a Note  will  not at any time  institute  against  the
Depositor,  the  Seller,  the  Master  Servicer  or the  Issuer,  or join in any
institution against the Depositor, the Seller, the Master Servicer or the Issuer
of, any  bankruptcy,  reorganization,  arrangement,  insolvency  or  liquidation
proceedings  under any United States federal or state  bankruptcy or similar law
in connection with any obligations  relating to the Notes,  the Indenture or the
Basic Documents.

      The Issuer has entered into the Indenture and this Note is issued with the
intention  that,  for  federal,  state and local  income,  single  business  and
franchise tax purposes,  the Notes will qualify as  indebtedness  of the Issuer.
Each holder of a Note, by acceptance of a Note (and each  Beneficial  Owner of a
Note by  acceptance  of a  beneficial  interest in a Note),  agrees to treat the
Notes for federal,  state and local  income,  single  business and franchise tax
purposes as indebtedness of the Issuer.

      Prior to the due  presentment  for  registration of transfer of this Note,
the Issuer,  the Indenture  Trustee and any agent of the Issuer or the Indenture
Trustee  may treat the Person in whose name this Note is  registered  (as of the
day of  determination  or as of  such  other  date  as may be  specified  in the
Indenture)  as the owner  hereof for all  purposes,  whether or not this Note

                                      A-4
<PAGE>

be overdue,  and none of the  Issuer,  the  Indenture  Trustee or any such agent
shall be affected by notice to the contrary.

      The Indenture permits,  with certain  exceptions as therein provided,  the
amendment  thereof and the  modification  of the rights and  obligations  of the
Issuer and the  Indenture  Trustee  and the  rights of the  holders of the Notes
under the Indenture at any time by the Issuer and the Indenture Trustee with the
consent of the holders of Notes  representing  a majority of the aggregate  Note
Balance of all Notes at the time  Outstanding and the Credit Enhancer with prior
notice to the Rating Agencies. The Indenture also contains provisions permitting
the holders of Notes  representing  specified  percentages of the aggregate Note
Balance of all Notes, on behalf of the holders of all the Notes with the consent
of the Credit  Enhancer,  or the Credit  Enhancer (so long as no Credit Enhancer
Default exists),  to waive  compliance by the Issuer with certain  provisions of
the  Indenture  and  certain  past  defaults   under  the  Indenture  and  their
consequences.  Any such consent or waiver by the Credit  Enhancer and the holder
of this Note (or any one of more  Predecessor  Notes)  shall be  conclusive  and
binding  upon such  holder and upon all  future  holders of this Note and of any
Note issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof  whether or not notation of such consent or waiver is made upon this
Note. The Indenture  also permits the Issuer and the Indenture  Trustee to amend
or waive certain  terms and  conditions  set forth in the Indenture  without the
consent of holders of the Notes issued  thereunder  but with prior notice to the
Rating Agencies and with the consent of the Credit Enhancer.

      The term  "Issuer"  as used in this Note  includes  any  successor  or the
Issuer under the Indenture.

      The Issuer is permitted by the Indenture, under certain circumstances,  to
merge or  consolidate,  subject to the rights of the  Indenture  Trustee and the
holders of Notes under the Indenture.

      The  Notes  are  issuable  only in  registered  form in  denominations  as
provided in the Indenture, subject to certain limitations therein set forth.

      This Note and the Indenture shall be construed in accordance with the laws
of the State of New York,  without  reference to its conflict of law  provisions
and the obligations, rights and remedies of the parties hereunder and thereunder
shall be determined in accordance with such laws.

      No reference  herein to the  Indenture and no provision of this Note or of
the Indenture  shall alter or impair,  the  obligation  of the Issuer,  which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency herein prescribed.

      Anything  herein to the  contrary  notwithstanding,  except  as  expressly
provided  in  the  Basic  Documents,  none  of  [_____________________]  in  its
individual capacity,  [______________________],  in its individual capacity, any
owner  of a  beneficial  interest  in the  Issuer,  or any of  their  respective
partners, beneficiaries, agents, officers, directors, employees or successors or
assigns shall be personally liable for, nor shall recourse be had to any of them
for,

                                      A-5
<PAGE>

the  payment of  principal  of or interest  on this Note or  performance  of, or
omission to  perform,  any of the  covenants,  obligations  or  indemnifications
contained in the  Indenture.  The holder of this Note by its  acceptance  hereof
agrees that, except as expressly provided in the Basic Documents, in the case of
an Event of Default under the Indenture,  the holder shall have no claim against
any of the  foregoing for any  deficiency,  loss or claim  therefrom;  provided,
however,  that nothing  contained  herein shall be taken to prevent recourse to,
and enforcement  against,  the assets of the Issuer for any and all liabilities,
obligations and undertakings contained in the Indenture or in this Note.

                                      A-6
<PAGE>

      IN WITNESS WHEREOF,  the Owner Trustee, on behalf of the Issuer and not in
its individual capacity, has caused this Note to be duly executed.

                                          HOME LOAN TRUST 200[_]-[___]

                                          By [_________________________], not in
                                              its individual capacity but solely
                                              as Owner Trustee
Dated: [__________________], 20[___]

                                          By ___________________________________
                                             Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

      This is one of the Class A-__ Notes  referred  to in the within  mentioned
Indenture.

                                          [______________________], not in its
                                          individual capacity but solely as
                                          Indenture Trustee

Dated: [__________________], 20[___]

                                          By ___________________________________
                                             Authorized Signatory

                                      A-7
<PAGE>

                                   ASSIGNMENT

Social  Security  or  taxpayer  I.D. or other  identifying  number of  assignee:
________________________________________

________________________________________________________________________________

FOR VALUE  RECEIVED,  the  undersigned  hereby sells,  assigns and transfer unto
_______________________________________

________________________________________________________________________________
                         (name and address of assignee)

the within Note and all rights thereunder,  and hereby  irrevocably  constitutes
and appoints ________________________

_______________________________________________________________________________,

attorney, to transfer said Note on the books kept for registration thereof, with
full power of substitution in the premises.

Dated: _______________________            ____________________________________*/
                                          Signature Guaranteed:

----------
*     NOTICE:  The signature to this assignment must correspond with the name of
      the registered owner as it appears on the face of the within Note in every
      particular,  without alteration,  enlargement or any change whatever. Such
      signature  must  be  guaranteed  by an  "eligible  guarantor  institution"
      meeting the requirements of the Note Registrar, which requirements include
      membership or participation  in STAMP or such other  "signature  guarantee
      program" as may be determined by the Note  Registrar in addition to, or in
      substitution  for, STAMP,  all in accordance with the Securities  Exchange
      Act of 1934, as amended.

                                      A-8
<PAGE>

                                                         APPENDIX TO EXHIBIT 4.4
                                   APPENDIX A

                                   DEFINITIONS

      Accrued Note Interest:  With respect to any class of Notes and any Payment
Date,  an amount  equal to interest  accrued for the  related  Interest  Accrual
Period on the related Note Balance immediately prior to that Payment Date at the
related Note Rate for that Payment  Date.  Accrued Note Interest for the Class A
Notes  (other  than the Class A-1 Notes)  will be  calculated  on the basis of a
30-day month in the related Interest Accrual Period and a 360-day year.  Accrued
Note  Interest  for the Class A-1 Notes will be  calculated  on the basis of the
actual number of days in the related Interest Accrual Period and a 360-day year.

      Administrative  Fees: The Servicing Fees and the fees payable to the Owner
Trustee and the Indenture Trustee.

      Affiliate:  With  respect to any  Person,  any other  Person  controlling,
controlled  by or under common  control  with such Person.  For purposes of this
definition, "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 and "controlling" and "controlled"  shall have meanings
correlative to the foregoing.

      Appraised  Value:  For any Home  Loan the value of the  related  Mortgaged
Property determined by the appraisal, sales price for such Mortgaged Property or
alternative  valuation  method used in the  origination of such Home Loan (which
may have been obtained at an earlier time);  provided that if such Home Loan was
originated simultaneously with or not more than 12 months after a senior lien on
the related  Mortgaged  Property  which was originated in a purchase or cash-out
refinance transaction,  the appraised value shall be the lesser of the appraised
value at the  origination  of the  senior  lien  and the  sales  price  for such
Mortgaged Property.

      Assignment  of Mortgage:  With  respect to any  Mortgage,  an  assignment,
notice of transfer or  equivalent  instrument,  in recordable  form,  sufficient
under the laws of the  jurisdiction in which the related  Mortgaged  Property is
located  to  reflect  the sale of the  Mortgage,  which  assignment,  notice  of
transfer  or  equivalent  instrument  may be in the form of one or more  blanket
assignments  covering  Mortgages secured by Mortgaged  Properties located in the
same jurisdiction.

      Authorized Newspaper: A newspaper of general circulation in the Borough of
Manhattan, The City of New York, printed in the English language and customarily
published on each Business Day,  whether or not published on Saturdays,  Sundays
or holidays.

      Authorized  Officer:  With respect to the Issuer, any officer of the Owner
Trustee who is authorized  to act for the Owner  Trustee in matters  relating to
the Issuer and who is identified on the list of Authorized Officers delivered by
the Owner Trustee to the Indenture Trustee on the Closing Date (as such list may
be modified or supplemented from time to time thereafter).

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

<PAGE>

      Basic  Documents:  The  Trust  Agreement,  the  Indenture,  the Home  Loan
Purchase Agreement, the Servicing Agreement, the Insurance Agreement, the Credit
Enhancement  Instrument,  the Custodial  Agreement  and the other  documents and
certificates delivered in connection with any of the above.

      Beneficial  Owner:  With  respect  to  any  Note,  the  Person  who is the
beneficial  owner of such Note as reflected on the books of the Depository or on
the books of a Person maintaining an account with such Depository (directly as a
Depository  Participant  or  indirectly  through a  Depository  Participant,  in
accordance with the rules of such Depository).

      Book-Entry Custodian:  The custodian appointed pursuant to Section 4.06 of
the Indenture.

      Book-Entry  Notes:  Beneficial  interests  in  the  Notes,  ownership  and
transfers  of which shall be made  through  book  entries by the  Depository  as
described in Section 4.06 of the Indenture.

      Business  Day: Any day other than (i) a Saturday or a Sunday or (ii) a day
on which  banking  institutions  in the States of New York,  California,  Texas,
Minnesota, Pennsylvania,  Illinois or Delaware are required or authorized by law
to be closed.

      Calendar Quarter: A Calendar Quarter shall consist of one of the following
time periods in any given year: January 1 through March 31, April 1 through June
30, July 1 though September 30, and October 1 through December 31.

      Certificate:  The certificate issued in the form of Exhibit A to the Trust
Agreement  and  outstanding  pursuant  to  the  terms  of the  Trust  Agreement,
evidencing a beneficial ownership interest in the Trust.

      Certificate  Distribution  Account:  The account or  accounts  created and
maintained by the  Certificate  Paying Agent pursuant to Section  3.10(c) of the
Trust Agreement. The Certificate Paying Agent will make all distributions on the
Certificate from money on deposit in the Certificate  Distribution  Account. The
Certificate Distribution Account shall be an Eligible Account.

      Certificate  Distribution  Amount:  The amount payable to the  Certificate
Paying Agent under  Section 3.05 of the  Indenture for payment to the holders of
the Certificate under the Trust Agreement.

      Certificate  Paying  Agent:  The meaning  specified in Section 3.10 of the
Trust Agreement.

      Certificate  Percentage Interest:  With respect to the Certificate and any
date of  determination,  the  percentage  interest  as stated on the face of the
Certificate,  which  percentage may be  recalculated  in accordance with Section
3.03 of the Trust Agreement.

      Certificate Principal Balance: As of any Payment Date, with respect to the
Certificate,  an  amount  equal to the then  applicable  Certificate  Percentage
Interest of such  Certificate,  multiplied  by the  Outstanding  Reserve  Amount
immediately prior to such Payment Date.

                                       2
<PAGE>

      Certificate Register: The register maintained by the Certificate Registrar
in which  the  Certificate  Registrar  shall  provide  for the  registration  of
Certificates and of transfers and exchanges of the Certificates.

      Certificate Registrar:  Initially,  the Indenture Trustee, in its capacity
as  Certificate  Registrar,  or any successor to the  Indenture  Trustee in such
capacity.

      Certificate  of  Trust:  The  Certificate  of Trust  filed  for the  Trust
pursuant  to Section  3810(a) of the  Statutory  Trust  Statute,  including  all
amendments and restatements.

      Certificateholder: The Person in whose name a Certificate is registered in
the Certificate Register except that, any Certificate  registered in the name of
the Issuer,  the Owner Trustee or the Indenture  Trustee or any Affiliate of any
of them shall be deemed not to be outstanding and the registered holder will not
be  considered  a  Certificateholder  or a holder  for  purposes  of giving  any
request, demand,  authorization,  direction, notice, consent or waiver under the
Indenture or the Trust  Agreement  provided  that,  in  determining  whether the
Indenture  Trustee or the Owner  Trustee  shall be protected in relying upon any
such request, demand, authorization,  direction, notice, consent or waiver, only
Certificates  that the  Indenture  Trustee or the Owner  Trustee  knows to be so
owned shall be so disregarded. Owners of the Certificates that have been pledged
in good  faith may be  regarded  as Holders if the  pledgee  establishes  to the
satisfaction of the Indenture Trustee or the Owner Trustee,  as the case may be,
the  pledgee's  right so to act with respect to such  Certificates  and that the
pledgee  is not the  Issuer,  any other  obligor  upon the  Certificates  or any
Affiliate of any of the foregoing Persons.

      Class: Collectively, all of the Notes bearing the same designation.

      Closing Date: [_____ __], 20[__].

      Code:  The Internal  Revenue Code of 1986,  as amended,  and the rules and
regulations promulgated thereunder.

      Collateral: The meaning specified in the Granting Clause of the Indenture.

      Collection  Period:  As to any Payment Date, the calendar month  preceding
the month of that Payment Date.

      Combined  Loan-to-Value  Ratio: With respect to each Home Loan, the ratio,
expressed as a percentage,  of (i) the sum of (A) the original principal balance
of such Home Loan, and (B) any outstanding  principal balance, at origination of
such Home  Loan,  of all other  mortgage  loans,  if any,  secured  by senior or
subordinate  liens on the  related  Mortgaged  Property,  to (ii) the  Appraised
Value,  or,  if  permitted  by the  Program  Guide,  the  purchase  price of the
Mortgaged Property, a statistical valuation or the Stated Value.

      Commission: The Securities and Exchange Commission.

      Corporate Trust Office: With respect to the Indenture Trustee, Certificate
Registrar, Certificate Paying Agent and Paying Agent, the corporate trust office
of the Indenture  Trustee and Note Registrar  from which at any particular  time
the Indenture shall be  administered,  which

                                       3
<PAGE>

office at the date of the execution of this  instrument is located at [Mail Code
EP-MN-WS3D,  60 Livingston Avenue, St. Paul, Minnesota  55107-2292],  Attention:
Structured  Finance/RFMSII  Home Loan Trust  20[__]-[___].  With  respect to the
Owner  Trustee,  the  principal  corporate  trust office of the Owner Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of the execution of this Trust  Agreement is located at
[Rodney Square North,  1100 North Market  Street,  Wilmington,  Delaware  19890,
Attention: Corporate Trust Administration].

      Credit  Enhancement  Instrument:   The   [_____________________],   Number
[_________],  dated as of the Closing Date, issued by the Credit Enhancer to the
Indenture Trustee.

      Credit  Enhancer:  [__________________________________],   a  [__________]
stock insurance corporation or any successor thereto.

      Credit  Enhancer  Default:  If the Credit Enhancer fails to make a payment
required under the Credit Enhancement Instrument in accordance with its terms.

      Credit Repository:  Equifax,  Transunion and Experian, or their successors
in interest.

      Credit  Scores:  The figure  assigned  to a Home Loan that is  designed to
assess the  Mortgagor's  credit  history which is obtained  from credit  reports
provided by various credit reporting  organizations and obtained by many lenders
in  connection  with  Home  Loan  applications  to  help  assess  a  Mortgagor's
creditworthiness.

      Custodial  Account:  The account or accounts created and maintained by the
Master Servicer pursuant to Section 3.02(b) of the Servicing Agreement, in which
the Master  Servicer shall deposit or cause to be deposited  certain  amounts in
respect of the Home Loans.

      Custodial  Agreement:  Any Custodial  Agreement  among the Custodian,  the
Indenture  Trustee and the Master  Servicer  relating to the custody of the Home
Loans and the Related Documents.

      Custodial  File:  Any mortgage  loan document in the Mortgage File that is
required to be delivered to the Custodian pursuant to Section 2.1(c) of the Home
Loan Purchase Agreement.

      Custodian:  [Wells  Fargo Bank,  N.A.,  a national  association],  and its
successors and assigns.

      Cut-off Date: [_____________ ___], 20[___].

      Cut-off  Date Loan  Balance:  With  respect to any Home  Loan,  the unpaid
principal  balance  thereof  as of the close of  business  on the  Business  Day
immediately prior to the Cut-off Date.

      Default:  Any  occurrence  which is or with notice or the lapse of time or
both would become an Event of Default.

                                       4
<PAGE>

      Deficiency  Amount:  With  respect  to any class of Notes and any  Payment
Date,  the sum of (i) the  excess,  if any, of (A) (1) the  aggregate  amount of
Accrued  Note  Interest  on such  Payment  Date less (2) an amount  equal to any
Prepayment  Interest  Shortfalls  and  Relief Act  Shortfalls  on the Home Loans
during the related Collection Period, over (B) the amount available for interest
distributions on the Notes on that Payment Date pursuant to the Indenture,  (ii)
any  Liquidation  Loss  Amount,  to the  extent not  distributed  as part of the
Liquidation  Loss Payment  Amount or covered by a reduction  of the  Outstanding
Reserve  Amount and (iii) the  aggregate  Note Balance on the Notes on the Final
Insured  Payment Date, if outstanding  after giving effect to all other payments
of principal on such Notes on such Payment Date from all sources  other than the
Credit Enhancement Instrument.

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

      Definitive Notes: The meaning specified in Section 4.06 of the Indenture.

      Deleted  Loan:  A Home Loan  replaced or to be  replaced  with an Eligible
Substitute Loan.

      Delinquent:  As used  herein,  a Home Loan is  considered  to be "30 to 59
days" or "30 or more days" delinquent when a payment due on any due date remains
unpaid as of the close of business on the next following monthly due date. Since
the  determination as to whether a Home Loan falls into these categories is made
as of the close of business on the last business day of each month,  a Home Loan
with a payment due on July 1 that remained unpaid as of the close of business on
July 31 would  still  be  considered  current  as of July  31.  If that  payment
remained  unpaid as of the close of  business  on August 31, the Home Loan would
then be considered  30-59 days  delinquent.  Delinquency  information  as of the
Cut-off Date is determined  and prepared as of the close of business on the last
business day immediately prior to the Cut-off Date.

      Depositor:  Residential  Funding Mortgage  Securities II, Inc., a Delaware
corporation, or its successor in interest.

      Depository  or  Depository  Agency:  The  Depository  Trust  Company  or a
successor appointed by the Indenture Trustee with the approval of the Depositor.
Any  successor  to the  Depository  shall  be an  organization  registered  as a
"clearing  agency"  pursuant  to  Section  17A  of  the  Exchange  Act  and  the
regulations of the Securities and Exchange Commission thereunder.

      Depository  Participant:  A  Person  for  whom,  from  time to  time,  the
Depository effects book-entry transfers and pledges of securities deposited with
the Depository.

      Derivative Contract: Any ISDA Master Agreement,  together with the related
schedule and  confirmation,  entered into by the Owner  Trustee and a Derivative
Counterparty in accordance with Section 5.06 of the Trust Agreement.

      Derivative  Counterparty:  Any  counterparty  to a Derivative  Contract as
provided in Section 5.06 of the Trust Agreement.

                                       5
<PAGE>

      Determination  Date: With respect to any Payment Date, the 20th day of the
month in which such  Payment  Date occurs or if such day is not a Business  Day,
the next succeeding Business Day.

      Due Date:  The date on which the Monthly  Payment on the related Home Loan
is due in accordance with the terms of the related Mortgage Note.

      Eligible Account: An account that is any of the following:  (i) maintained
with a depository institution the short-term debt obligations of which have been
rated by each Rating Agency in its highest rating category available, or (ii) an
account or accounts in a depository institution in which such accounts are fully
insured to the limits established by the FDIC, provided that any deposits not so
insured shall, to the extent  acceptable to each Rating Agency,  as evidenced in
writing,  be  maintained  such  that (as  evidenced  by an  Opinion  of  Counsel
delivered to the Indenture Trustee and each Rating Agency) the Indenture Trustee
has a claim with  respect  to the funds in such  account  or a  perfected  first
security  interest  against any collateral  (which shall be limited to Permitted
Investments)  securing  such  funds  that is  superior  to  claims  of any other
depositors or creditors of the depository institution with which such account is
maintained,  or (iii) in the case of the Custodial  Account,  either (A) a trust
account  or  accounts  maintained  at  the  corporate  trust  department  of the
Indenture  Trustee or (B) an account or  accounts  maintained  at the  corporate
trust  department  of the  Indenture  Trustee,  as long as its  short  term debt
obligations  are rated P-1 by  Moody's  and A-1+ by  Standard  & Poor's  (or the
equivalent)  or better by each Rating Agency and its long term debt  obligations
are rated A2 by Moody's  and AA- by  Standard & Poor's  (or the  equivalent)  or
better,  by each Rating Agency, or (iv) in the case of the Custodial Account and
the Payment  Account,  a trust  account or accounts  maintained in the corporate
trust  division  of the  Indenture  Trustee,  or (v) an account or accounts of a
depository institution acceptable to each Rating Agency (as evidenced in writing
by each Rating Agency that use of any such account as the  Custodial  Account or
the Payment Account will not reduce the rating assigned to any of the Securities
by such Rating Agency (if determined  without  regard to the Credit  Enhancement
Instrument) below the lower of the then-current rating or the rating assigned to
such  Securities  (if  determined  without  regard  to  the  Credit  Enhancement
Instrument) as of the Closing Date by such Rating Agency).

      Eligible  Substitute  Loan:  A Home Loan  substituted  by the Seller for a
Deleted Loan which must,  on the date of such  substitution,  as confirmed in an
Officers'   Certificate   delivered  to  the  Indenture  Trustee,  (i)  have  an
outstanding  principal balance,  after deduction of the principal portion of the
monthly  payment  due  in the  month  of  substitution  (or  in  the  case  of a
substitution  of more  than  one Home  Loan for a  Deleted  Loan,  an  aggregate
outstanding  principal  balance,  after  such  deduction),  not in excess of the
outstanding  principal  balance of the Deleted Loan (the amount of any shortfall
to be  deposited  by the  Seller  in the  Custodial  Account  in  the  month  of
substitution);  (ii) comply with each  representation and warranty (other than a
statistical  representation or warranty) set forth in Section 3.1(b) of the Home
Loan Purchase  Agreement as of the date of substitution;  (iii) have a Loan Rate
no lower  than and not more than 1% in  excess of the Loan Rate of such  Deleted
Loan;  (iv) have a Combined  Loan-to-Value  Ratio at the time of substitution no
higher than that of the Deleted Loan at the time of  substitution;  (v) have, at
the time of  substitution,  a remaining term to stated maturity not greater than
(and not more  than  one year  less  than)  that of the  Deleted  Loan;  (vi) be
ineligible for inclusion in a real estate mortgage  investment conduit ("REMIC")
(a "REMIC  Ineligible  Loan") if the Deleted  Loan was a REMIC

                                       6
<PAGE>

Ineligible Loan (because (a) the value of the real property securing the Deleted
Loan was not at least  equal to eighty  percent of the  adjusted  issue price of
such loan at the time of  origination,  calculated by subtracting  the amount of
any liens  that are senior to such Home Loan and a  proportionate  amount of any
lien of equal priority from the value of such property when the Deleted Loan was
originated  and (b)  substantially  all of the proceeds of the Deleted Loan were
not used to  acquire,  improve  or  protect  an  interest  in the real  property
securing such loan and such real property was the only security for such Deleted
Loan); and (vii) not be 30 or more days delinquent.

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

      Event of Default: With respect to the Indenture,  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):

      (i) a default  in the  payment of any  interest  on any Note when the same
becomes due and payable,  and such default  shall  continue for a period of five
days; or

      (ii) a default in the payment of the  principal of or any  installment  of
the  principal of any Note when the same becomes due and payable other than as a
result of  Prepayment  Interest  Shortfalls or Relief Act  Shortfalls,  and such
default shall continue for a period of five days; or

      (iii)  there  occurs a default in the  observance  or  performance  of any
covenant or agreement of the Issuer made in the Indenture, or any representation
or warranty of the Issuer made in the Indenture or in any  certificate  or other
writing delivered pursuant hereto or in connection herewith proving to have been
incorrect in any  material  respect as of the time when the same shall have been
made  which has a  material  adverse  effect on  Securityholders  or the  Credit
Enhancer,  and such default shall continue or not be cured, or the  circumstance
or condition in respect of which such  representation  or warranty was incorrect
shall not have been eliminated or otherwise cured, for a period of 30 days after
there shall have been given,  by registered or certified  mail, to the Issuer by
the Indenture  Trustee or to the Issuer and the Indenture Trustee by the Holders
of at least 25% of the  outstanding  Note  Balance  of the  Notes or the  Credit
Enhancer,  a written notice specifying such default or incorrect  representation
or warranty  and  requiring  it to be remedied and stating that such notice is a
notice of default hereunder; or

      (iv)  there  occurs  the filing of a decree or order for relief by a court
having  jurisdiction in the premises in respect of the Issuer or any substantial
part of the Trust Estate in an involuntary case under any applicable  federal or
state bankruptcy, insolvency or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar  official of the Issuer or for any substantial part of the Trust Estate,
or ordering the  winding-up or  liquidation  of the Issuer's  affairs,  and such
decree  or  order  shall  remain  unstayed  and in  effect  for a  period  of 60
consecutive days; or

      (v) there occurs the  commencement by the Issuer of a voluntary case under
any applicable federal or state bankruptcy,  insolvency or other similar law now
or  hereafter  in effect,

                                       7
<PAGE>

or the  consent  by the  Issuer  to the  entry  of an  order  for  relief  in an
involuntary  case  under  any such  law,  or the  consent  by the  Issuer to the
appointment or taking possession by a receiver, liquidator, assignee, custodian,
trustee,  sequestrator or similar  official of the Issuer or for any substantial
part of the  assets  of the Trust  Estate,  or the  making by the  Issuer of any
general  assignment  for the benefit of creditors,  or the failure by the Issuer
generally to pay its debts as such debts become due, or the taking of any action
by the Issuer in furtherance of any of the foregoing.

      Event of Servicer Termination:  With respect to the Servicing Agreement, a
Servicing Default as defined in Section 7.01 of the Servicing Agreement.

      Exchange Act: The  Securities  Exchange Act of 1934,  as amended,  and the
rules and regulations promulgated thereunder.

      Expenses: The meaning specified in Section 7.02 of the Trust Agreement.

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

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

      Final Insured Payment Date: The Payment Date in [______] 20[__].

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

      Foreclosure Profit: With respect to a Liquidated Home Loan, the excess, if
any, of (x) Net Liquidation Proceeds over (y) the sum of (a) the Loan Balance of
the related Home Loan immediately  prior to the date it became a Liquidated Home
Loan, less any Net Liquidation Proceeds previously received with respect to such
Home Loan and  applied as a recovery  of  principal,  and (b) accrued and unpaid
interest  on the  related  Home  Loan at the Net Loan Rate  through  the date of
receipt of the proceeds.

      Form 10-K  Certification:  As defined in Section  4.04(b) of the Servicing
Agreement.

      Grant: Pledge, bargain, sell, warrant,  alienate, remise, release, convey,
assign,  transfer,  create, and grant a lien upon and a security interest in and
right  of  set-off  against,  deposit,  set  over and  confirm  pursuant  to the
Indenture.  A Grant of the  Collateral  or of any other  agreement or instrument
shall include all rights,  powers and options (but none of the  obligations)  of
the granting party  thereunder,  including the immediate and continuing right to
claim for, collect, receive and give receipt for principal and interest payments
in respect of such  collateral or other  agreement or  instrument  and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other  agreements,  to exercise  all rights and  options,  to
bring proceedings in the name of the granting party or otherwise,  and generally
to do and receive  anything that the granting  party is or may be entitled to do
or receive thereunder or with respect thereto.

      Holder: Any of the Noteholders or Certificateholders.

      Homeownership Act: The Home Ownership Protection Act of 1994.

                                       8
<PAGE>

      Home Loans:  At any time, the Home Loans that have been sold by the Seller
under the Home Loan Purchase Agreement, together with the Related Documents, and
that remain subject to the terms thereof.

      Home Loan Purchase Agreement:  The Home Loan Purchase  Agreement,  between
the Seller, as seller, and the Depositor, as purchaser, with respect to the Home
Loans, dated as of the Cut-off Date.

      Home Loan Schedule:  The initial  schedule of Home Loans as of the Cut-off
Date set forth in Exhibit A of the  Servicing  Agreement,  which  schedule  sets
forth as to each Home Loan, among other things:

      (i) the Home Loan identifying number ("RFC LOAN #");

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

      (iii) the maturity of the Mortgage Note ("MATURITY DATE");

      (iv) the Loan Rate ("CUR RATE");

      (v) the Principal Balance at origination ("ORG AMT");

      (vi) the type of property securing the Mortgage Note ("PROPERTY TYPE");

      (vii) the appraised value ("APPRSL");

      (viii) the initial  scheduled  monthly  payment of principal,  if any, and
interest ("ORIGINAL P & I");

      (ix) the Cut-off Date Loan Balance ("CUT-OFF BAL");

      (x) the Combined Loan-to-Value Ratio at origination ("CLTV");

      (xi) the date of the Mortgage Note ("NOTE DATE");

      (xii) the original term to maturity of the Home Loan ("ORIGINAL TERM");

      (xiii) under the column "OCCP  CODE," a code  indicating  whether the Home
Loan is secured by a non-owner occupied residence;

      (xiv) the Principal Balance of any Home Loan senior thereto ("SR BAL");

      (xv) the Credit Score ("CR SCORE");

      (xvi) the debt to income ratio ("DTI");

      (xvii) product code ("PRODUCT CODE");

      (xviii) loan purpose ("PURPOSE");

                                       9
<PAGE>

      (xix) the lien position of the related Mortgage ("LIEN");

      (xx) the Subservicer loan number (SERVICER LOAN #); and

      (xxi) the remaining term of the Home Loan (REMAINING TERM).

      Such schedule may consist of multiple reports that  collectively set forth
all of the information required.

      Indemnified  Party:  The meaning  specified  in Section  7.02 of the Trust
Agreement.

      Indenture:  The indenture dated as of the Closing Date between the Issuer,
as debtor, and the Indenture Trustee, as indenture trustee.

      Indenture  Trustee:  [_______________________],  and  its  successors  and
assigns or any successor  indenture trustee  appointed  pursuant to the terms of
the Indenture.

      Indenture Trustee  Information:  As specified in Section  9.05(a)(i)(A) of
the Servicing Agreement.

      Independent:  When used with respect to any specified  Person,  the Person
(i) is in fact  independent of the Issuer,  any other obligor on the Notes,  the
Seller,  the Issuer,  the  Depositor  and any  Affiliate of any of the foregoing
Persons,  (ii)  does not have any  direct  financial  or any  material  indirect
financial  interest  in the Issuer,  any such other  obligor,  the  Seller,  the
Issuer, the Depositor or any Affiliate of any of the foregoing Persons and (iii)
is not  connected  with the Issuer,  any such other  obligor,  the  Seller,  the
Issuer,  the Depositor or any  Affiliate of any of the  foregoing  Persons as an
officer, employee, promoter,  underwriter,  trustee, partner, director or person
performing similar functions.

      Independent  Certificate:  A certificate or opinion to be delivered to the
Indenture Trustee under the circumstances  described in, and otherwise complying
with, the applicable requirements of Section 10.01 of the Indenture,  made by an
Independent  appraiser  or other  expert  appointed  by an  Issuer  Request  and
approved by the Indenture  Trustee in the exercise of reasonable  care, and such
opinion or  certificate  shall state that the signer has read the  definition of
"Independent"  in this Indenture and that the signer is  Independent  within the
meaning thereof.

      Initial   Certificate:   The   Home   Loan-Backed   Certificates,   Series
20[__]-[___],  issued on the Closing Date, each evidencing  undivided beneficial
interests in the Issuer and executed by the Owner Trustee.

      Initial   Note   Balance:   With   respect   to  the  Class   A-1   Notes,
$[_________________], with respect to the Class A-2 Notes, $[_________________],
with  respect to the Class A-3 Notes,  $[_________________]  and with respect to
the Class A-4 Notes, $[_________________].

      Insolvency Event: With respect to a specified Person,  (a) the filing of a
decree or order for relief by a court  having  jurisdiction  in the  premises in
respect of such Person or any substantial part of its property in an involuntary
case under any  applicable  bankruptcy,  insolvency  or other similar law now or
hereafter in effect, or appointing a receiver, liquidator,

                                       10
<PAGE>

assignee,  custodian,  trustee, sequestrator or similar official for such Person
or for any  substantial  part of its  property,  or ordering the  winding-up  or
liquidation  of such  Person's  affairs,  and such decree or order shall  remain
unstayed  and in  effect  for a  period  of 60  consecutive  days;  or  (b)  the
commencement by such Person of a voluntary case under any applicable bankruptcy,
insolvency  or other  similar law now or hereafter in effect,  or the consent by
such Person to the entry of an order for relief in an involuntary case under any
such  law,  or the  consent  by such  Person  to the  appointment  of or  taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official for such Person or for any substantial part of its property,
or the  making by such  Person of any  general  assignment  for the  benefit  of
creditors,  or the  failure by such  Person  generally  to pay its debts as such
debts  become due or the  admission  by such  Person in writing (as to which the
Indenture  Trustee shall have written  notice) of its inability to pay its debts
generally,  or the adoption by the Board of Directors or managing member of such
Person of a resolution which authorizes  action by such Person in furtherance of
any of the foregoing.

      Insurance  Agreement:  The Insurance and Indemnity  Agreement  dated as of
[________________  ___], 20[___], among the Master Servicer, the Depositor,  the
Issuer, the Indenture Trustee and the Credit Enhancer,  including any amendments
and supplements thereto.

      Insured Payment:  With respect to (a) any Payment Date, the sum of (i) any
Deficiency  Amount and (ii) any  Preference  Amount and (b) any other date,  any
Preference Amount.

      Insurance  Proceeds:  Proceeds paid by any insurer  (other than the Credit
Enhancer)  pursuant  to any  insurance  policy  covering  a Home Loan  which are
required to be remitted to the Master  Servicer,  or amounts required to be paid
by the Master Servicer  pursuant to the next to last sentence of Section 3.04 of
the Servicing Agreement,  net of any component thereof (i) covering any expenses
incurred by or on behalf of the Master  Servicer in  connection  with  obtaining
such proceeds,  (ii) that is applied to the restoration or repair of the related
Mortgaged  Property,  (iii)  released to the  Mortgagor in  accordance  with the
Master Servicer's normal servicing procedures or (iv) required to be paid to any
holder of a mortgage senior to such Home Loan.

      Interest Accrual Period: With respect to (i) the Class A-1 Notes (a) as to
the Payment Date in  [________________],  20[___],  the period commencing on the
Closing   Date  and  ending  on  the  day   preceding   the   Payment   Date  in
[________________],  20[___],  and (b) as to any Payment  Date after the Payment
Date in  [________________],  20[___], the period commencing on the Payment Date
in the month  immediately  preceding the month in which that Payment Date occurs
and ending on the day preceding  that Payment Date and (ii) each class of Notes,
other  than the Class A-1  Notes,  and any  Payment  Date,  the  calendar  month
preceding the month in which the related Payment Date occurs.

      Interest Collections: With respect to any Payment Date, the sum of (i) the
portion  allocable  to interest of all  scheduled  monthly  payments on the Home
Loans   received   during  the  related   Collection   Period   reduced  by  the
Administrative  Fees for such Collection  Period,  (ii) the portion allocable to
interest of all Net Liquidation  Proceeds and proceeds from  repurchases of, and
some amounts received in connection with any substitutions for, the related Home
Loans, received or deemed received during the related Collection Period, reduced
by any  related  Administrative  Fees  for that  Collection  Period,  (iii)  the
interest portion of the cash purchase price

                                       11
<PAGE>

paid in  connection  with any optional  purchase of the Home Loans by the Master
Servicer  and (iv) any  proceeds  and  recoveries  received  during the  related
Collection  Period  on a Home  Loan  after it  becomes  a  Liquidated  Home Loan
allocated  to Interest  Collections  in  accordance  with the last  paragraph of
Section 3.07 of the Servicing Agreement,  reduced by the Administrative Fees for
such Collection Period.

      Issuer or Trust: The Home Loan Trust  20[__]-[___],  a Delaware  statutory
trust, or its successor in interest.

      Issuer  Request:  A  written  order or  request  signed in the name of the
Issuer by any one of its  Authorized  Officers and  delivered  to the  Indenture
Trustee.

      LIBOR:  For any  Interest  Accrual  Period  other than the first  Interest
Accrual  Period,  the rate for United States dollar deposits for one month which
appears on the Dow Jones  Telerate  Screen Page 3750 as of 11:00  A.M.,  London,
England  time,  on the second LIBOR  Business Day prior to the first day of such
Interest Accrual Period.  With respect to the first Interest Accrual Period, the
rate for United  States  dollar  deposits for one month which appears on the Dow
Jones  Telerate  Screen Page 3750 as of 11:00 A.M.,  London,  England time,  two
LIBOR  Business  Days prior to the Closing Date. 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 reasonably  selected by the Indenture  Trustee after
consultation with the Master Servicer and the Credit Enhancer), the rate will be
the Reference Bank Rate. If no such  quotations can be obtained and no Reference
Bank Rate is available,  LIBOR will be LIBOR applicable to the preceding Payment
Date.

      LIBOR  Business Day: Any day other than (i) a Saturday or a Sunday or (ii)
a day on which banking institutions in the city of London,  England are required
or authorized by law to be closed.

      Lien:  Any mortgage,  deed of trust,  pledge,  conveyance,  hypothecation,
assignment,  participation, deposit arrangement, encumbrance, lien (statutory or
other),  preference,  priority right or interest or other security  agreement or
preferential  arrangement of any kind or nature whatsoever,  including,  without
limitation,  any  conditional  sale or  other  title  retention  agreement,  any
financing  lease having  substantially  the same  economic  effect as any of the
foregoing  and the filing of any financing  statement  under the UCC (other than
any  such  financing  statement  filed  for  informational   purposes  only)  or
comparable law of any  jurisdiction to evidence any of the foregoing;  provided,
however, that any assignment pursuant to Section 6.02 of the Servicing Agreement
shall not be deemed to constitute a Lien.

      Limited Repurchase Right Holder: The Master Servicer.

      Liquidated  Home Loan:  As to any  Payment  Date,  any Home Loan which the
Master Servicer has determined,  based on the servicing  procedures specified in
the Servicing Agreement,  as of the end of the preceding Collection Period, that
all  Liquidation  Proceeds  which it expects to recover in  connection  with the
disposition of the related Mortgaged Property have been recovered.  In addition,
the Master Servicer will treat any Home Loan that is 180 days or more delinquent
as having been finally liquidated.

                                       12
<PAGE>

      Liquidation Expenses: Out-of-pocket expenses (exclusive of overhead) which
are  incurred  by or on behalf of the Master  Servicer  in  connection  with the
liquidation of any Home Loan and not recovered under any insurance policy,  such
expenses   including,   without  limitation,   legal  fees  and  expenses,   any
unreimbursed amount expended (including, without limitation, amounts advanced to
correct  defaults  on any loan  which is senior  to such  Home Loan and  amounts
advanced  to keep  current  or pay off a loan that is senior to such Home  Loan)
respecting the related Home Loan and any related and  unreimbursed  expenditures
for  real  estate  property  taxes  or for  property  acquisition,  restoration,
preservation or disposition, or insurance against casualty loss or damage.

      Liquidation  Loss  Amount:  With  respect to any Payment Date and any Home
Loan that became a Liquidated  Home Loan during the related  Collection  Period,
the  unrecovered  portion of the related Loan Balance thereof at the end of such
Collection Period,  after giving effect to the Net Liquidation  Proceeds applied
to reduce the related Loan Balance.  In addition,  as to any Home Loan for which
the  principal   balance  has  been  reduced  in  connection   with   bankruptcy
proceedings,  the amount of the reduction will be treated as a Liquidation  Loss
Amount.

      Liquidation  Loss Payment Amount:  As to any Payment Date, an amount equal
to the lesser of (i) the amount  available for payment of the  Liquidation  Loss
Payment  Amount for that  Payment  Date,  as  provided in clause (iv) of Section
3.05(a) of the  Indenture and (ii) the sum of (a) 100% of the  Liquidation  Loss
Amounts incurred on the related Home Loans during the related  Collection Period
and (b) any  Liquidation  Loss  Amounts  remaining  unpaid  from  any  preceding
Collection Period, to the extent not reflected on such preceding Payment Date by
a reduction of the Outstanding Reserve Amount.

      Liquidation  Proceeds:  Proceeds  (including  Insurance  Proceeds  but not
including amounts drawn under the Credit Enhancement Instrument) if any received
in  connection  with the  liquidation  of any Home Loan or related REO,  whether
through  trustee's sale,  foreclosure sale, the exercise of the power of eminent
domain or condemnation or otherwise.

      Loan Balance:  With respect to any Home Loan, other than a Liquidated Home
Loan,  and as of any day,  the  related  Cut-off  Date Loan  Balance,  minus all
collections in respect of principal in accordance with the related Mortgage Note
and applied in  reduction  of the Loan  Balance  thereof.  For  purposes of this
definition,  a Liquidated Home Loan shall be deemed to have a Loan Balance equal
to zero.

      Loan Rate or Mortgage Rate: With respect to any Home Loan and any day, the
per annum rate of interest set forth in the related Mortgage Note.

      Lost  Note  Affidavit:  With  respect  to any Home  Loan as to  which  the
original  Mortgage Note has been  permanently lost or destroyed and has not been
replaced,  an affidavit from the Seller  certifying  that the original  Mortgage
Note has been lost,  misplaced or destroyed (together with a copy of the related
Mortgage Note).

      Master  Servicer:  Residential  Funding  Company,  LLC, a Delaware limited
liability company, and its successors and assigns.

                                       13
<PAGE>

      Master Servicer Extension Notice: The meaning specified in Section 7.04(d)
of the Servicing Agreement.

      Master  Servicing  Fee:  With respect to any Home Loan and any  Collection
Period,  the product of (i) the Master Servicing Fee Rate divided by 12 and (ii)
the Loan  Balance  of such  Home  Loan as of the  first  day of such  Collection
Period.

      Master Servicing Fee Rate: With respect to any Home Loan, 0.08% per annum.

      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 Home Loans  registered  with
MERS on the MERS(R) System.

      MOM Loan:  With respect to any Home Loan,  MERS acting as the mortgagee of
such Home Loan,  solely as nominee for the  originator of such Home Loan and its
successors and assigns, at the origination thereof.

      Monthly  Payment:  With  respect  to any  Home  Loan  (including  any  REO
Property) and any Due Date, the payment of principal and interest due thereon in
accordance with the amortization  schedule at the time applicable thereto (after
adjustment,  if  any,  for  partial  prepayments  and for  Deficient  Valuations
occurring prior to such Due Date but before any adjustment to such  amortization
schedule  by reason of any  bankruptcy,  other than a  Deficient  Valuation,  or
similar proceeding or any moratorium or similar waiver or grace period).

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

      Mortgage: The mortgage, deed of trust or other instrument creating a first
or second lien on an estate in fee simple or leasehold interest in real property
securing a Home Loan.

      Mortgage File: The file containing the Related  Documents  pertaining to a
particular  Home Loan and any additional  documents  required to be added to the
Mortgage  File  pursuant to the Home Loan  Purchase  Agreement or the  Servicing
Agreement.

      Mortgage Note:  With respect to a Home Loan, the mortgage note pursuant to
which the related mortgagor agrees to pay the indebtedness evidenced thereby and
secured by the related Mortgage as modified or amended.

      Mortgaged Property:  The underlying property,  including real property and
improvements thereon, securing a Home Loan.

      Mortgagor: The obligor or obligors under a Mortgage Note.

                                       14
<PAGE>

      Net  Liquidation  Proceeds:  As to any Liquidated Home Loan, the proceeds,
including   Insurance  Proceeds  but  excluding  amounts  drawn  on  the  Credit
Enhancement Instrument,  received in connection with the liquidation of the Home
Loan, whether through trustee's sale, foreclosure sale or otherwise,  reduced by
related  expenses,  but not including the portion,  if any, of the proceeds that
exceed  the  principal  balance  of the Home  Loan at the end of the  Collection
Period immediately preceding the Collection Period in which the Home Loan became
a Liquidated Home Loan.

      Net  Loan  Rate:   With   respect  to  any  Home  Loan  and  any  date  of
determination,  a per annum rate of interest equal to the then  applicable  Loan
Rate for such Home Loan minus the Servicing Fee Rate and the Premium Percentage.

      Note Balance: With respect to any Payment Date and any Class of Notes, the
Initial Note Balance  thereof  reduced by all payments of the Principal  Payment
Amount thereon prior to and as of such Payment Date.

      Note Owner: The Beneficial Owner of a Note.

      Note Rate: With respect to (i) the Class A-1 Notes,  will be the lesser of
(a) LIBOR plus  [____]% per annum and (b) [____]% per annum;  and (ii) the Class
A-2 Notes, Class A-3 Notes, and Class A-4 Notes and any Interest Accrual Period,
[____]%,[____]%  and  [____]%  per annum,  respectively;  provided,  that on the
Step-Up Date, the Note Rate on the Class A-4 Notes shall increase by [____]% per
annum.

      Note Register:  The register maintained by the Note Registrar in which the
Note Registrar shall provide for the  registration of Notes and of transfers and
exchanges of Notes.

      Note Registrar: The Indenture Trustee, in its capacity as Note Registrar.

      Noteholder:  The  Person in whose  name a Note is  registered  in the Note
Register,  except that, any Note  registered in the name of the  Depositor,  the
Issuer or the Indenture  Trustee or any Affiliate of any of them shall be deemed
not to be  outstanding  and the  registered  holder  will  not be  considered  a
Noteholder or holder for purposes of giving any request, demand,  authorization,
direction,  notice, consent or waiver under the Indenture or the Trust Agreement
provided that, in determining  whether the Indenture  Trustee shall be protected
in relying upon any such  request,  demand,  authorization,  direction,  notice,
consent or waiver,  only Notes that the  Indenture  Trustee or the Owner Trustee
knows to be so owned  shall be so  disregarded.  Owners of Notes  that have been
pledged in good faith may be regarded as Holders if the pledgee  establishes  to
the  satisfaction  of the  Indenture  Trustee or the Owner Trustee the pledgee's
right so to act with  respect  to such  Notes  and that the  pledgee  is not the
Issuer,  any  other  obligor  upon  the  Notes  or any  Affiliate  of any of the
foregoing  Persons.  Any  Notes on which  payments  are made  under  the  Credit
Enhancement Instrument shall be deemed Outstanding until the Credit Enhancer has
been reimbursed with respect thereto and the Credit Enhancer shall be deemed the
Noteholder thereof to the extent of such unreimbursed payment.

      Notes:  Any one of the Class A-1,  Class A-2, Class A-3 or Class A-4 Notes
issued and outstanding at any time pursuant to the Indenture.

                                       15
<PAGE>

      Officer's Certificate:  With respect to the Master Servicer, a certificate
signed by the President,  Managing Director,  a Director, a Vice President or an
Assistant Vice President,  of the Master Servicer and delivered to the Indenture
Trustee.  With respect to the Issuer,  a  certificate  signed by any  Authorized
Officer of the  Issuer,  under the  circumstances  described  in, and  otherwise
complying  with, the applicable  requirements of Section 10.01 of the Indenture,
and  delivered  to  the  Indenture  Trustee.  Unless  otherwise  specified,  any
reference in the Indenture to an Officer's  Certificate shall be to an Officer's
Certificate of any Authorized Officer of the Issuer.

      Opinion of Counsel:  A written opinion of counsel.  Any Opinion of Counsel
for the Master  Servicer  may be  provided  by  in-house  counsel for the Master
Servicer if reasonably  acceptable to the Indenture Trustee, the Credit Enhancer
and the Rating Agencies or counsel for the Depositor, as the case may be.

      Optional Redemption: The right of the Master Servicer to purchase the Home
Loans on any Payment Date on which the aggregate  Principal  Balance of the Home
Loans as of the end of the  related  Collection  Period  is less than 10% of the
Cut-off Date Balance, pursuant to Section 8.08 of the Servicing Agreement.

      Original Trust Agreement: The Trust Agreement,  dated as of [_____________
___], 20[__], between the Owner Trustee and the Depositor.

      Outstanding:  With respect to the Notes, as of the date of  determination,
all Notes theretofore executed, authenticated and delivered under this Indenture
except:

      (i) Notes theretofore  cancelled by the Note Registrar or delivered to the
Indenture Trustee for cancellation; and

      (ii)  Notes in  exchange  for or in lieu of which  other  Notes  have been
executed,  authenticated  and delivered  pursuant to the Indenture  unless proof
satisfactory to the Indenture  Trustee is presented that any such Notes are held
by a holder in due course;

provided, however, that for purposes of effectuating the Credit Enhancer's right
of  subrogation  as set forth in Section 4.12 of the Indenture  only,  all Notes
that have been paid with funds provided under the Credit Enhancement  Instrument
shall be deemed to be Outstanding  until the Credit Enhancer has been reimbursed
with respect thereto.

      Outstanding  Reserve Amount: With respect to any Payment Date, the amount,
if any,  by which the Pool  Balance  after  applying  payments  received  in the
related  Collection  Period  exceeds the aggregate  Note Balance of the Notes on
such  Payment  Date,  after   application  of  Principal   Collections  and  the
Liquidation Loss Payment Amounts for that Payment Date. The Outstanding  Reserve
Amount will be increased by distributions of Reserve Increase Amount, if any, to
the Notes. As of the Closing Date, the Outstanding  Reserve Amount will be equal
to approximately  [____]% of the aggregate unpaid principal  balance of the Home
Loans on the Business Day prior to the Cut-off Date.

      Owner Trust  Estate:  The meaning  specified  in Section 2.05 of the Trust
Agreement.

                                       16
<PAGE>

      Owner Trustee:  [__________________]  not in its  individual  capacity but
solely as Owner  Trustee of the Trust,  and its  successors  and  assigns or any
successor owner trustee appointed pursuant to the terms of the Trust Agreement.

      Owner Trustee Information:  As specified in Section  11.04(a)(i)(A) of the
Trust Agreement.

      Paying Agent:  Any paying agent or co-paying agent  appointed  pursuant to
Section 3.03 of the Indenture, which initially shall be the Indenture Trustee.

      Payment Account: The account established by the Indenture Trustee pursuant
to Section 8.02 of the Indenture  and Section 5.01 of the  Servicing  Agreement.
Amounts  deposited in the Payment Account will be paid by the Indenture  Trustee
in accordance with Section 3.05 of the Indenture.

      Payment Date: The 25th day of each month, or if such day is not a Business
Day, then the next Business Day.

      Percentage   Interest:   With   respect  to  any  Note  and  any  date  of
determination,  the  percentage  obtained by dividing  the Note  Balance of such
Note, by the aggregate of the Note Balances of all Notes of the same Class.

      Permitted Investments: One or more of the following:

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

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

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

                                       17
<PAGE>

institution or trust company shall exceed 30 days, the short-term rating of such
institution  shall be A-1+ in the case of Standard & Poor's if Standard & Poor's
is the Rating Agency;

      (iv)  commercial  paper (having  original  maturities of not more than 365
days) of any corporation incorporated under the laws of the United States or any
state  thereof  which on the date of  acquisition  has been rated by each Rating
Agency in its highest short-term rating category  available;  provided that such
commercial paper shall have a remaining maturity of not more than 30 days;

      (v) a money  market  fund or a  qualified  investment  fund  rated by each
Rating Agency in its highest long-term rating category available; and

      (vi) other  obligations  or securities  that are acceptable to each Rating
Agency as an  Permitted  Investment  hereunder  and will not  reduce  the rating
assigned  to any  Securities  by such  Rating  Agency  below  the  lower  of the
then-current  rating or the rating assigned to such Securities as of the Closing
Date by such Rating Agency, and which are acceptable to the Credit Enhancer,  as
evidenced in writing,  provided that if the Master  Servicer or any other Person
controlled by the Master Servicer is the issuer or the obligor of any obligation
or security  described in this clause (vi) such obligation or security must have
an  interest  rate or yield that is fixed or is variable  based on an  objective
index that is not affected by the rate or amount of losses on the Home Loans;

provided,  however,  that no  instrument  shall be a Permitted  Investment if it
represents,  either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest  payments derived from  obligations  underlying such instrument and the
principal and interest payments with respect to such instrument  provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations  References  herein to the highest  rating  available  on  unsecured
long-term  debt shall  mean AAA in the case of  Standard & Poor's and Aaa in the
case of Moody's,  and  references  herein to the  highest  rating  available  on
unsecured  commercial paper and short-term debt  obligations  shall mean A-1+ in
the case of  Standard & Poor's  and P-1 in the case of  Moody's.  Any  Permitted
Investment may be held by or through the Indenture Trustee and its Affiliates.

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

      Pool Balance: With respect to any date, the aggregate of the Loan Balances
of all Home Loans as of such date.

      Predecessor Note: With respect to any particular Note, every previous Note
evidencing  all or a  portion  of the  same  debt  as  that  evidenced  by  such
particular Note; and, for the purpose of this definition, any Note authenticated
and delivered under Section 4.03 of the Indenture in lieu of a mutilated,  lost,
destroyed  or  stolen  Note  shall be deemed  to  evidence  the same debt as the
mutilated, lost, destroyed or stolen Note.

      Preference  Amount:  Any amount  previously  paid to a Noteholder  that is
recoverable and sought to be recovered as a voidable  preference by a trustee in
bankruptcy court pursuant to the

                                       18
<PAGE>

United  States  Bankruptcy  Code (11 U.S.C.),  as amended from time to time,  in
accordance  with a  final  non-appealable  order  of a court  exercising  proper
jurisdiction in an insolvency proceeding.

      Premium:  The amount of premium due to the Credit  Enhancer in  accordance
with the terms of the Insurance Agreement.

      Premium Percentage: As set forth in the Insurance Agreement.

      Prepayment  Assumption:  A 100%  Prepayment  Assumption  used  solely  for
determining the accrual of original issue discount, market discount and premium,
if any,  on the  Notes  for  federal  income  tax  purposes.  A 100%  Prepayment
Assumption  assumes  a  constant  prepayment  rate of 5% per annum for the first
month,  increasing each month by an additional 20%/14 until the fifteenth month.
Beginning in the fifteenth month and in each month thereafter during the life of
the Home Loans, a 100% Prepayment  Assumption assumes a constant prepayment rate
of 25% per annum each month.

      Prepayment  Interest  Shortfall:  With  respect to any Payment  Date,  the
aggregate shortfall, if any, in collections of interest, adjusted to the related
Net Loan Rate, resulting from borrower prepayments during the related Collection
Period. These shortfalls will not be covered by the Master Servicer,  the Credit
Enhancer or any other person.

      Principal  Collection  Payment  Amount:  As to any Payment Date, the total
Principal Collections (reduced by any portion used to pay interest on the Notes)
for such Payment Date;  provided,  however,  on any Payment Date as to which the
Outstanding  Reserve  Amount that would  result  without  regard to this proviso
exceeds the Reserve Amount Target, the Principal  Collection Payment Amount will
be reduced  by the  amount not less than zero by the amount of the excess  until
the Outstanding Reserve Amount equals the Reserve Amount Target.

      Principal Collections:  As to any Payment Date, an amount equal to the sum
of:

      (i) the principal portion of all scheduled Monthly Payments on the related
Home Loans received during the related Collection Period;

      (ii) the principal  portion of all proceeds of the  repurchase of any Home
Loans (or, in the case of a substitution,  any Substitution  Adjustment Amounts)
as required by the Servicing  Agreement  received during the related  Collection
Period and the principal  portion of the cash purchase  price paid in connection
with any optional purchase of the Home Loans by the Master Servicer; and

      (iii) the principal portion of all other unscheduled  collections received
on the Home Loans during the related Collection Period (or deemed to be received
during the related Collection Period) (including,  without limitation,  full and
partial  Principal  Prepayments  made by the  respective  Mortgagors,  Insurance
Proceeds and Net Liquidation Proceeds), to the extent not previously paid;

provided,  however,  that Principal  Collections shall be reduced by any amounts
withdrawn from the Custodial Account pursuant to Section 3.03(ii), (v), (vi) and
(vii) of the Servicing Agreement.

                                       19
<PAGE>

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

      Proceeding:  Any  suit in  equity,  action  at law or  other  judicial  or
administrative proceeding.

      Program Guide: Together, the Seller's Seller Guide and Servicing Guide, as
in effect from time to time.

      Prospectus Supplement:  The prospectus supplement,  dated [_______________
___],  20[___],  relating to the issuance of the Home Loan-Backed Notes,  Series
20[__]-[___].

      Purchase Price:  The meaning  specified in Section 2.2(a) of the Home Loan
Purchase Agreement.

      Purchaser:  Residential  Funding Mortgage  Securities II, Inc., a Delaware
corporation, and its successors and assigns.

      Qualified Insurer: A mortgage guaranty insurance company duly qualified as
such under the laws of the state of its  principal  place of  business  and each
state having  jurisdiction  over such insurer in  connection  with the insurance
policy issued by such insurer,  duly  authorized  and licensed in such states to
transact a mortgage guaranty  insurance business in such states and to write the
insurance  provided by the insurance policy issued by it, approved as an insurer
by the Master Servicer and as a FNMA-approved mortgage insurer.

      Rating Agency: Any nationally recognized  statistical rating organization,
or its  successor,  that rated the Securities at the request of the Depositor at
the time of the initial  issuance of the  Securities,  which  initially shall be
Moody's or Standard & Poor's.  If such  organization or a successor is no longer
in existence,  "Rating Agency" shall be such nationally  recognized  statistical
rating  organization,  or other comparable Person,  designated by the Depositor,
notice of which designation shall be given to the Indenture Trustee.  References
herein to the highest short term  unsecured  rating  category of a Rating Agency
shall  mean A-1 or better in the case of  Standard & Poor's and P-1 or better in
the case of Moody's and in the case of any other  Rating  Agency shall mean such
equivalent  ratings.  References herein to the highest long-term rating category
of a Rating  Agency  shall mean "AAA" in the case of Standard & Poor's and "Aaa"
in the  case  of  Moody's  and in the  case of any  other  Rating  Agency,  such
equivalent rating.

      Record Date: With respect to the Class A-1 Notes and any Payment Date, the
Business  Day next  preceding  such  Payment  Date and with respect to the Notes
(other than the Class A-1 Notes) and the  Certificates and any Payment Date, the
last Business Day of the month preceding the month of such Payment Date.

      Reference  Bank Rate:  With respect to any  Interest  Accrual  Period,  as
follows: the arithmetic mean (rounded upwards, if necessary,  to the nearest one
sixteenth of a percent) of the offered rates for United  States dollar  deposits
for one month which are offered by the Reference

                                       20
<PAGE>

Banks as of 11:00 A.M.,  London,  England time, on the second LIBOR Business Day
prior to the first day of such  Interest  Accrual  Period to prime  banks in the
London interbank market for a period of one month in amounts approximately equal
to the sum of the outstanding Note Balance of the Class A-1 Notes; provided that
at least two such  Reference  Banks provide such rate. If fewer than two offered
rates appear,  the Reference Bank Rate will be the arithmetic  mean of the rates
quoted by one or more major banks in New York City,  selected  by the  Indenture
Trustee after consultation with the Master Servicer and the Credit Enhancer,  as
of 11:00 a.m., New York 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  Note  Balance of the Class A-1 Notes.  If no such  quotations  can be
obtained,  the  Reference  Bank Rate shall be LIBOR  applicable to the preceding
Payment Date; provided however,  that if, under the priorities  indicated above,
LIBOR for a Payment Date would be based on LIBOR for the  previous  Payment Date
for the third  consecutive  Payment Date, the Indenture  Trustee shall select an
alternative  comparable  index over which the Indenture  Trustee has no control,
used for determining  one-month  Eurodollar lending rates that is calculated and
published or otherwise made available by an independent party.

      Reference Banks: Barclays Bank PLC, Credit Suisse and Abbey National PLC.

      Registered  Holder:  The Person in whose name a Note is  registered in the
Note Register on the applicable Record Date.

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

      Related Documents: With respect to each Home Loan, the documents specified
in Section 2.1(c) of the Home Loan Purchase Agreement and any documents required
to be added to such documents pursuant to the Home Loan Purchase Agreement,  the
Trust Agreement or the Servicing Agreement.

      Release  Agreement:  A Release Agreement as defined in Section 3.05 of the
Servicing Agreement.

      Relief Act  Shortfall:  With respect to any Payment  Date,  the  aggregate
shortfall, if any, in collections of interest, as a result of the application of
the Servicemembers Civil Relief Act or similar legislation or regulations. These
shortfalls will reduce the amount of Interest  Collections on the Home Loans and
will not be amounts  paid by the Master  Servicer,  the Credit  Enhancer  or any
other person.

      REO: A Mortgaged Property that is acquired by the Issuer in foreclosure or
by deed in lieu of foreclosure.

      Repurchase Event: With respect to any Home Loan, one of the following: (i)
a discovery  that, as of the Closing Date, the related  Mortgage was not a valid
lien on the related

                                       21
<PAGE>

Mortgaged  Property subject only to (A) the lien of any prior mortgage indicated
on the Home Loan Schedule,  (B) the lien of real property taxes and  assessments
not yet due and payable, (C) covenants, conditions, and restrictions,  rights of
way, easements and other matters of public record as of the date of recording of
such Mortgage and such other  permissible  title exceptions as are listed in the
Program  Guide and (D) other  matters  to which  like  properties  are  commonly
subject which do not materially  adversely affect the value,  use,  enjoyment or
marketability  of the related  Mortgaged  Property,  or (ii) with respect to any
Home Loan as to which the Seller  delivers a Lost Note  Affidavit,  a subsequent
default on such Home Loan if the enforcement  thereof or of the related Mortgage
is  materially  and adversely  affected by the absence of the original  Mortgage
Note.

      Repurchase Price: With respect to any Home Loan required to be repurchased
on any date  pursuant to the Home Loan  Purchase  Agreement  or purchased by the
Master Servicer or the Limited Repurchase Right Holder pursuant to the Servicing
Agreement,  an amount equal to the sum of (i) 100% of the Loan  Balance  thereof
(without reduction for any amounts charged off) and (ii) unpaid accrued interest
at the Loan Rate (or with  respect  to the last day of the month in the month of
repurchase,  the Loan Rate  will be the Loan Rate in effect as to the  second to
last day in such month) on the  outstanding  principal  balance thereof from the
Due Date to which  interest  was last paid by the  Mortgagor to the first day of
the month following the month of purchase.

      Request  for  Release:  The form  attached  as Exhibit 4 to the  Custodial
Agreement or an electronic request in a form acceptable to the Custodian.

      Reserve Amount Floor: An amount equal to [____]% of the Pool Balance as of
the Cut-off Date.

      Reserve Amount Target:  As to any Payment Date prior to the Stepdown Date,
an amount  equal to [____]% of the Cut-off  Date Pool  Balance.  On or after the
Stepdown Date, the Reserve Amount Target will be equal to the lesser of:

      (a) [____]% of the Pool Balance after  applying  payments  received in the
related Collection Period; and

      (b) the Reserve Amount Target as of the Cut-off Date;

provided,  however,  that the Reserve  Amount  Target shall not be less than the
Reserve  Amount Floor;  provided  further,  that any scheduled  reduction to the
Reserve Amount Target on or after the Stepdown Date as described above shall not
be made on any Payment Date unless:

            (i) either (a) the aggregate  cumulative  Liquidation Loss Amount on
      the Home Loans from the Cut-off  Date  through  the end of the  Collection
      Period immediately prior to such Payment Date is less than:

                  (A)  [____]% of the Pool  Balance as of the Cut-off  Date,  if
            such Payment Date is the 31st through 36th Payment Dates,

                                       22
<PAGE>

                  (B)  [____]% of the Pool  Balance as of the Cut-off  Date,  if
            such Payment Date is the 37th through 48th Payment Dates, or

                  (C)  [____]% of the Pool  Balance as of the Cut-off  Date,  if
            such Payment Date is the 49th through 60th Payment Dates, or

                  (D)  [____]% of the Pool  Balance as of the Cut-off  Date,  if
            such Payment Date is the 61st through 72nd Payment Dates, or

                  (E)  [____]% of the Pool  Balance as of the Cut-off  Date,  if
            such  Payment  Date is the 73rd  Payment  Date (or any Payment  Date
            thereafter) or

                  (b) the average of the  aggregate  Liquidation  Loss Amount on
            the Home Loans that became  Liquidated Home Loans during the related
            Collection  Period,  as determined for the current and five previous
            Payment  Dates,  is  less  than  50% of the  average  of the  amount
            remaining  in the Payment  Account on such  Payment  Date  following
            distributions  pursuant to clauses (i)-(v) of Section 3.05(a) of the
            Indenture  (other than  distributions  made pursuant to clause (iii)
            thereof),  as determined  for the current and five previous  Payment
            Dates and

            (ii) there has been no draw on the Credit Enhancement  Instrument on
      such Payment Date that remains unreimbursed.

      In  addition,  the  Reserve  Amount  Target may be reduced  with the prior
written consent of the Credit  Enhancer (so long as no Credit  Enhancer  Default
exists) and notice to the Rating Agencies.

      Reserve  Increase  Amount:  As to the any Payment Date, an amount equal to
the lesser of (i) the amount  available  for  payment  of the  Reserve  Increase
Amount for that Payment Date,  as provided in clause (vi) of Section  3.05(a) of
the Indenture and (ii) the excess,  if any of (x) the Reserve Amount Target over
(y) the Outstanding Reserve Amount.

      Responsible Officer: With respect to the Indenture Trustee, any officer of
the   Indenture   Trustee,   in  each  case  with  direct   responsibility   for
administration of the Indenture,  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.

      Sale: The meaning specified in Section 5.15 of the Indenture.

      Securities Act: The Securities Act of 1933, as amended,  and the rules and
regulations promulgated thereunder.

      Securitization  Transaction:  Any  transaction  involving  a sale or other
transfer  of  mortgage  loans  directly or  indirectly  to an issuing  entity in
connection with an issuance of publicly  offered or privately  placed,  rated or
unrated mortgage-backed securities.

      Security: Any of the Certificates or Notes.

                                       23
<PAGE>

      Securityholder or Holder: Any Noteholder or a Certificateholder.

      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:  Residential  Funding Company,  LLC, a Delaware limited  liability
company, and its successors and assigns.

      Servicing Agreement:  The Servicing Agreement dated as of the Closing Date
among the  Indenture  Trustee,  the Issuer and the  Master  Servicer,  as master
servicer.

      Servicing  Certificate:  A certificate  prepared by a Servicing Officer on
behalf of the Master  Servicer in accordance  with Section 4.01 of the Servicing
Agreement.

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

      Servicing Default:  The meaning specified in Section 7.01 of the Servicing
Agreement.

      Servicing  Fee:  With  respect  to any Home Loan,  the sum of the  related
Master Servicing Fee and the related Subservicing Fee.

      Servicing Fee Rate:  With respect to any Home Loan, the sum of the related
Master Servicing Fee Rate and the related Subservicing Fee Rate.

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

      Servicing Trigger: As of any Payment Date, for purposes of Section 7.04 of
the Servicing  Agreement,  "Servicing Trigger;  Removal of Master Servicer," the
aggregate cumulative  Liquidation Loss Amount on the Home Loans from the Cut-off
Date through the end of the Collection Period  immediately prior to such Payment
Date is greater than:

      (A) [____]% of the Pool  Balance as of the Cut-off  Date,  if such Payment
Date is the 31st through 36th Payment Dates,

      (B) [____]% of the Pool  Balance as of the Cut-off  Date,  if such Payment
Date is the 37th through 48th Payment Dates, or

      (C) [____]% of the Pool  Balance as of the Cut-off  Date,  if such Payment
Date is the 49th through 60th Payment Dates, or

      (D) [____]% of the Pool  Balance as of the Cut-off  Date,  if such Payment
Date is the 61st through 72nd Payment Dates, or

                                       24
<PAGE>

      (E) [____]% of the Pool  Balance as of the Cut-off  Date,  if such Payment
Date is the 73rd Payment Date (or any Payment Date thereafter).

      Standard  & Poor's:  Standard  & Poor's,  a  Division  of The  McGraw-Hill
Companies, Inc. or its successor in interest.

      Stated Value: The value of the Mortgaged Property as stated by the related
Mortgagor in his or her application.

      Statutory  Trust Statute:  Chapter 38 of Title 12 of the Delaware Code, 12
Del. Code ss.ss.3801 et seq., as the same may be amended from time to time.

      Step-Up Date:  The second Payment Date  immediately  following the Payment
Date on which the Master  Servicer  can  purchase  all or some of the Home Loans
from the Trust pursuant to Section 8.08 of the Servicing Agreement.

      Stepdown Date:  The later of (a) the Payment Date in [_______]  20[__] and
(b) the first Payment Date on which the aggregate  Pool Balance,  after applying
payments  received in the related  Collection  Period,  is less than or equal to
50.00% of the aggregate Pool Balance as of the Cut-off Date.

      Subservicer:  Any Person with whom the Master  Servicer has entered into a
Subservicing Agreement as a Subservicer by the Master Servicer.

      Subservicing  Account:  An Eligible Account established or maintained by a
Subservicer as provided for in Section 3.02(c) of the Servicing Agreement.

      Subservicing  Agreement:  The written contract between the Master Servicer
and any  Subservicer  relating to servicing and  administration  of certain Home
Loans as provided in Section 3.01 of the Servicing Agreement.

      Subservicing Fee: With respect to any Collection  Period, the fee retained
monthly by the Subservicer  (or, in the case of a  nonsubserviced  Home Loan, by
the  Master  Servicer)  equal to the  product of (i) the  Subservicing  Fee Rate
divided by 12 and (ii) the Pool  Balance as of the first day of such  Collection
Period.

      Subservicing  Fee Rate: With respect to each Home Loan, the amount payable
to the related Subservicer, equal to 0.50% per annum.

      Substitution  Adjustment Amounts:  With respect to any Eligible Substitute
Loan,  the  amount as  defined  in  Section  3.1(b)  of the Home  Loan  Purchase
Agreement and any Deleted Loan, the amount,  if any, as determined by the Master
Servicer,  by  which  the  aggregate  principal  balance  of all  such  Eligible
Substitute  Loans  as of the date of  substitution  is less  than the  aggregate
principal balance of all such Deleted Loans (after  application of the principal
portion of the Monthly Payments due in the month of substitution  that are to be
distributed to the Payment Account in the month of substitution).

                                       25
<PAGE>

      Termination  Price:  In the event that all of the Home Loans are purchased
by the Master Servicer, the Termination Price will be an amount equal to 100% of
the unpaid Loan Balance of each Home Loan so purchased,  plus accrued and unpaid
interest  thereon at the  weighted  average of the Loan  Rates  through  the day
preceding the Payment Date on which such purchase occurs,  plus any amounts owed
by the Seller  pursuant to the second  paragraph  of Section  3.1(c) of the Home
Loan  Purchase  Agreement in respect of any  liability,  penalty or expense that
resulted  from a breach of the  representation  and warranty set forth in clause
(x) of Section 3.1(b) of the Home Loan Purchase Agreement, that remain unpaid on
the date of such purchase.

      Transaction  Party:  As  specified  in Section  9.02(a)  of the  Servicing
Agreement.

      Treasury  Regulations:   Regulations,   including  proposed  or  temporary
Regulations,   promulgated  under  the  Code.   References  herein  to  specific
provisions  of  proposed  or  temporary   regulations  shall  include  analogous
provisions  of  final   Treasury   Regulations  or  other   successor   Treasury
Regulations.

      Trust Agreement: The Amended and Restated Trust Agreement, dated as of the
Closing Date, between the Owner Trustee and the Depositor.

      Trust  Estate:  The  meaning  specified  in  the  Granting  Clause  of the
Indenture.

      Trust  Indenture  Act or TIA: The Trust  Indenture Act of 1939, as amended
from time to time, as in effect on any relevant date.

      UCC: The Uniform  Commercial  Code,  as amended  from time to time,  as in
effect in any specified jurisdiction.

      Underwriters:  [Name of Underwriter] and [Residential  Funding Securities,
LLC].

      United  States  Person:  A citizen or  resident  of the United  States,  a
corporation,  partnership  or other entity created or organized in, or under the
laws of, the United  States or any 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 other than a "foreign  trust"  within the
meaning of Section 7701(a)(30) of the Code.

                                       26

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