Document:

Unassociated Document

    

    

    
      	 

    

    

    

    PHH
      MORTGAGE CAPITAL LLC,

    Depositor

     

     

    PHH
      MORTGAGE CORPORATION,

    Master
      Servicer

     

     

    CITIBANK
      N.A.,

    Trustee

     

     

    POOLING
      AND SERVICING AGREEMENT

     

     

    Dated
      as
      of September 1, 2006

     

     

    PHHMC
      Mortgage Pass-Through Certificates, Series 2006-3

     

    

    

    
      	 

    

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    TABLE
      OF
      CONTENTS

     

    

      
        	
                ARTICLE
                  I

                DEFINITIONS

                 

              
	
                Section
                  1.01

              	
                Defined
                  Terms.

              
	
                Section
                  1.02

              	
                Accounting.

                 

              
	
                ARTICLE
                  II

                CONVEYANCE
                  OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES

                 

              
	
                Section
                  2.01

              	
                Conveyance
                  of Mortgage Loans.

              
	
                Section
                  2.02

              	
                Acceptance
                  of Trust Fund by the Trustee.

              
	
                Section
                  2.03

              	
                Repurchase
                  or Substitution of Mortgage Loans by the Sellers- Assignment of
                  Interest
                  in Pledged Assets.

              
	
                Section
                  2.04

              	
                Representations,
                  Warranties and Covenants of the Master Servicer.

              
	
                Section
                  2.05

              	
                Representations
                  and Warranties of the Depositor.

              
	
                Section
                  2.06

              	
                Purpose
                  and Powers of the Trust.

              
	
                Section
                  2.07

              	
                Issuance
                  of Certificates.

                 

              
	
                ARTICLE
                  III

                ADMINISTRATION
                  AND SERVICING OF THE TRUST FUND

                 

              
	
                Section
                  3.01

              	
                Master
                  Servicer to Act as Master Servicer.

              
	
                Section
                  3.02

              	
                Sub-Servicing
                  Agreements Between the Master Servicer and
                  Sub-Servicers.

              
	
                Section
                  3.03

              	
                Successor
                  Sub-Servicers.

              
	
                Section
                  3.04

              	
                Liability
                  of the Master Servicer.

              
	
                Section
                  3.05

              	
                No
                  Contractual Relationship Between Sub-Servicers and Trustee or
                  Certificateholders.

              
	
                Section
                  3.06

              	
                Assumption
                  or Termination of Sub-Servicing Agreements by Trustee.

              
	
                Section
                  3.07

              	
                Collection
                  of Certain Mortgage Loan Payments.

              
	
                Section
                  3.08

              	
                Sub-Servicing
                  Accounts.

              
	
                Section
                  3.09

              	
                Collection
                  of Taxes, Assessments and Similar Items; Servicing
                  Accounts.

              
	
                Section
                  3.10

              	
                Collection
                  Account and Distribution Account.

              
	
                Section
                  3.11

              	
                Withdrawals
                  from the Collection Account and Distribution Account.

              
	
                Section
                  3.12

              	
                Investment
                  of Funds in the Collection Account, Servicing Accounts and the
                  Distribution Account.

              
	
                Section
                  3.13

              	
                Maintenance
                  of the Primary Insurance Policies; Collections
                  Thereunder.

              
	
                Section
                  3.14

              	
                Maintenance
                  of Hazard Insurance and Errors and Omissions and Fidelity
                  Coverage.

              
	
                Section
                  3.15

              	
                Enforcement
                  of Due-On-Sale Clauses; Assumption Agreements.

              
	
                Section
                  3.16

              	
                Realization
                  Upon Defaulted Mortgage Loans.

              
	
                Section
                  3.17

              	
                Trustee
                  to Cooperate; Release of Mortgage Files.

              
	
                Section
                  3.18

              	
                Servicing
                  Compensation.

              
	
                Section
                  3.19

              	
                Reports
                  to the Trustee; Collection Account Statements.

              
	
                Section
                  3.20

              	
                Annual
                  Statement as to Compliance.

              
	
                Section
                  3.21

              	
                Assessments
                  of Compliance and Attestation Reports.

              
	
                Section
                  3.22

              	
                Access
                  to Certain Documentation.

              
	
                Section
                  3.23

              	
                Title,
                  Management and Disposition of REO Property.

              
	
                Section
                  3.24

              	
                Obligations
                  of the Master Servicer in Respect of Prepayment Interest
                  Shortfalls.

              
	
                Section
                  3.25

              	
                Administration
                  of Buydown Funds.

              
	
                Section
                  3.26

              	
                Obligations
                  of the Master Servicer in Respect of Loan Rates and Monthly
                  Payments.

                 

              
	
                ARTICLE
                  IV

                PAYMENTS
                  TO CERTIFICATEHOLDERS

                 

              
	
                Section
                  4.01

              	
                Distribution
                  Account; Distributions.

              
	
                Section
                  4.02

              	
                Statements
                  to Certificateholders.

              
	
                Section
                  4.03

              	
                Remittance
                  Reports; Advances by the Master Servicer.

              
	
                Section
                  4.04

              	
                Allocation
                  of Realized Losses.

              
	
                Section
                  4.05

              	
                Information
                  Reports to Be Filed by the Master Servicer.

              
	
                Section
                  4.06

              	
                Compliance
                  with Withholding Requirements.

              
	
                Section
                  4.07

              	
                [Reserved].

              
	
                Section
                  4.08

              	
                Limited
                  Purpose Surety Bond.

                 

              
	
                ARTICLE
                  V

                THE
                  CERTIFICATES

                 

              
	
                Section
                  5.01

              	
                The
                  Certificates.

              
	
                Section
                  5.02

              	
                Registration
                  of Transfer and Exchange of Certificates.

              
	
                Section
                  5.03

              	
                Mutilated.
                  Destroyed. Lost or Stolen Certificates.

              
	
                Section
                  5.04

              	
                Persons
                  Deemed Owners.

              
	
                Section
                  5.05

              	
                Appointment
                  of Paying Agent.

                 

              
	
                ARTICLE
                  VI

                THE
                  MASTER SERVICER AND THE DEPOSITOR

                 

              
	
                Section
                  6.01

              	
                Liability
                  of the Master Servicer and the Depositor.

              
	
                Section
                  6.02

              	
                Merger
                  or Consolidation of or Assumption of the Obligations of the Master
                  Servicer or the Depositor.

              
	
                Section
                  6.03

              	
                Limitation
                  on Liability of the Master Servicer and Others.

              
	
                Section
                  6.04

              	
                Master
                  Servicer Not to Resign.

              
	
                Section
                  6.05

              	
                Delegation
                  of Duties.

                 

              
	
                ARTICLE
                  VII 

                DEFAULT

                 

              
	
                Section
                  7.01

              	
                Master
                  Servicer Events of Termination.

              
	
                Section
                  7.02

              	
                Trustee
                  to Act; Appointment of Successor.

              
	
                Section
                  7.03

              	
                Waiver
                  of Master Servicer Events of Termination.

              
	
                Section
                  7.04

              	
                Notification
                  to Certificateholders.

              
	
                Section
                  7.05

              	
                Survivability
                  of Master Servicer Liabilities.

                 

              
	
                ARTICLE
                  VIII

                THE
                  TRUSTEE

                 

              
	
                Section
                  8.01

              	
                Duties
                  of Trustee.

              
	
                Section
                  8.02

              	
                Certain
                  Matters Affecting the Trustee.

              
	
                Section
                  8.03

              	
                Trustee
                  Not Liable for Certificates or Mortgage Loans.

              
	
                Section
                  8.04

              	
                Trustee
                  May Own Certificates.

              
	
                Section
                  8.05

              	
                Master
                  Servicer to Pay Trustee Expenses; Trustee Fees.

              
	
                Section
                  8.06

              	
                Eligibility
                  Requirements for Trustee.

              
	
                Section
                  8.07

              	
                Resignation
                  or Removal of Trustee.

              
	
                Section
                  8.08

              	
                Successor
                  Trustee.

              
	
                Section
                  8.09

              	
                Merger
                  or Consolidation of Trustee.

              
	
                Section
                  8.10

              	
                Appointment
                  of Co-Trustee or Separate Trustee.

              
	
                Section
                  8.11

              	
                Limitation
                  of Liability.

              
	
                Section
                  8.12

              	
                Trustee
                  May Enforce Claims Without Possession of Certificates.

              
	
                Section
                  8.13

              	
                Suits
                  for Enforcement.

              
	
                Section
                  8.14

              	
                Waiver
                  of Bond Requirement.

              
	
                Section
                  8.15

              	
                Waiver
                  of Inventory. Accounting and Appraisal Requirement.

              
	
                Section
                  8.16

              	
                Right
                  of Trustee in Capacity of Certificate Registrar or Paying
                  Agent.

              
	
                Section
                  8.17

              	
                Periodic
                  Filings.

              
	
                Section
                  8.18

              	
                Intention
                  of the Parties and Interpretation.

                 

              
	
                ARTICLE
                  IX

                REMIC
                  ADMINISTRATION

                 

              
	
                Section
                  9.01

              	
                REMIC
                  Administration.

              
	
                Section
                  9.02

              	
                Prohibited
                  Transactions and Activities.

              
	
                Section
                  9.03

              	
                Master
                  Servicer and Trustee Indemnification.

                 

              
	
                ARTICLE
                  X

                TERMINATION

                 

              
	
                Section
                  10.01

              	
                Termination.

              
	
                Section
                  10.02

              	
                Additional
                  Termination Requirements.

                 

              
	
                ARTICLE
                  XI

                [RESERVED]

                 

                 

              
	
                ARTICLE
                  XII

                MISCELLANEOUS
                  PROVISIONS

                 

              
	
                Section
                  12.01

              	
                Amendment.

              
	
                Section
                  12.02

              	
                Recordation
                  of Agreement: Counterparts.

              
	
                Section
                  12.03

              	
                Limitation
                  on Rights of Certificateholders.

              
	
                Section
                  12.04

              	
                Governing
                  Law: Jurisdiction.

              
	
                Section
                  12.05

              	
                Notices.

              
	
                Section
                  12.06

              	
                Severability
                  of Provisions.

              
	
                Section
                  12.07

              	
                Article
                  and Section References.

              
	
                Section
                  12.08

              	
                Notice
                  to the Rating Agency.

              
	
                Section
                  12.09

              	
                Further
                  Assurances.

              
	
                Section
                  12.10

              	
                Benefits
                  of Agreement.

              
	
                Section
                  12.11

              	
                Acts
                  of Certificateholders.

              
	 	 
	 	 
	
                EXHIBITS:

                 

              	 
	
                Exhibit
                  A

              	
                Form
                  of Class A Certificates

              
	
                Exhibit
                  B

              	
                [Reserved]

              
	
                Exhibit
                  C-1

              	
                Form
                  of Class R Certificates

              
	
                Exhibit
                  C-2

              	
                Form
                  of Class B Certificates

              
	
                Exhibit
                  D

              	
                Mortgage
                  Loan Schedule

              
	
                Exhibit
                  E

              	
                Form
                  of Request for Release

              
	
                Exhibit
                  F-1

              	
                Form
                  of Rule 144A Representation Letter

              
	
                Exhibit
                  F-2

              	
                Form
                  of Transferor Certificate

              
	
                Exhibit
                  F-3

              	
                Form
                  of Transferee Representation Letter

              
	
                Exhibit
                  F-4

              	
                Form
                  of Transfer Affidavit and Agreement and Form of Transferor
                  Affidavit

              
	
                Exhibit
                  G-1

              	
                Form
                  of ERISA Representation Letter (Class B-4, Class B-5 and Class
                  B-6)

              
	
                Exhibit
                  G-2

              	
                Form
                  of ERISA Representation Letter (Class A-6, Class A-7, Class A-8,
                  Class
                  B-1, Class B-2 and Class B-3)

              
	
                Exhibit
                  H

              	
                Form
                  of Lost Note Affidavit

              
	
                Exhibit
                  I-1

              	
                Form
                  of Trustee’s Initial Certification

              
	
                Exhibit
                  I-2

              	
                Form
                  of Trustee’s Final Certification

              
	
                Exhibit
                  J

              	
                Mortgage
                  Loan Purchase Agreement

              
	
                Exhibit
                  K

              	
                Assignment,
                  Assumption and Recognition Agreement (Pledged Asset Servicing
                  Agreement)

              
	
                Exhibit
                  L

              	
                [Reserved]

              
	
                Exhibit
                  M

              	
                Form
                  of Form 10-K Certificate

              
	
                Exhibit
                  N

              	
                Form
                  of Back-up Certification to Form 10-K Certificate

              
	
                Exhibit
                  O

              	
                Servicing
                  Criteria to Be Addressed in Assessment of Compliance

              
	
                Exhibit
                  P

              	
                Form
                  10-D, Form 8-K and Form 10-K Reporting Responsibility

              
	
                Exhibit
                  Q

              	
                Transaction
                  Parties

              

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    This
      Pooling and Servicing Agreement is dated as of September 1, 2006 (the
“Agreement”), among PHH MORTGAGE CAPITAL LLC, as depositor (the “Depositor”),
      PHH MORTGAGE CORPORATION, as master servicer (the “Master Servicer”) and
      CITIBANK, N.A., as trustee (the “Trustee”).

     

    PRELIMINARY
      STATEMENT:

     

    The
      Depositor intends to sell mortgage pass-through certificates (collectively,
      the
“Certificates”), to be issued hereunder in multiple classes, which in the
      aggregate will evidence the entire beneficial ownership interest in the Mortgage
      Loans (as defined herein). As provided herein, the Trustee will make, in
      accordance with Section 9.01, an election to treat the entire segregated pool
      of
      assets described in the definition of Trust Fund (as defined herein), and
      subject to this Agreement (including the Mortgage Loans), as two real estate
      mortgage investment conduits (each a “REMIC”) for federal income tax
      purposes.

     

    REMIC
      I

     

    The
      following table sets forth (or describes) the Class designation, Pass-Through
      Rate and Uncertificated Principal Balance, for each Class of REMIC I Regular
      Interest comprising the interests in REMIC I created hereunder:

     

     

    
      	
              REMIC
                I Regular Interest

            	 	
              Uncertificated

              Principal
                Balance

            	 	
              Uncertificated

              Pass-Through
                Rate(1)

            	 	
              Assumed
                Final

              Maturity
                Date(2)

            
	
              A-1

            	 	
              $

            	
              24,846,218.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              A-2

            	 	
              $

            	
              25,297,813.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              A-4

            	 	
              $

            	
              24,846,218.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              A-5

            	 	
              $

            	
              9,938,487.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              A-6

            	 	
              $

            	
              2,282,607.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              A-7

            	 	
              $

            	
              2,433,612.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              A-8

            	 	
              $

            	
              13,118,803.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              R-II
                Interest

            	 	
              $

            	
              100.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              B-1

            	 	
              $

            	
              4,646,243.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              B-2

            	 	
              $

            	
              819,925.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              B-3

            	 	
              $

            	
              437,293.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              B-4

            	 	
              $

            	
              273,308.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              B-5

            	 	
              $

            	
              218,647.00

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            
	
              B-6

            	 	
              $

            	
              163,986.61

            	 	
              Variable
                Rate

            	 	
              October
                18, 2036

            

    

    

    
      	
              (1)

            	
              Calculated
                in accordance with the definition of “Uncertificated Pass-Through Rate”
                herein.

            
	 	 
	
              (2)

            	
              For
                purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
                the
                Distribution Date in the month following the month of the maturity
                date
                for the Mortgage Loan with the latest maturity date has been designated
                as
                the “latest possible maturity date” for each REMIC I Regular
                Interest.

            

    

    

    

    

    REMIC
      II

     

    The
      following table sets forth (or describes) the Class designation, Pass-Through
      Rate and Original Certificate Principal Balance or Original Notional Amount
      for
      each Class of Certificates comprising the interests in the Trust Fund created
      hereunder:

     

    
      	
               Class

            	 	
              Original
                Certificate

              Principal
                Balance
                or Original Notional Amount

            	 	
              Initial
                Pass-

              Through
                Rate

            	 	
              Assumed
                Final

              Maturity
                Dates(1)

            
	
              A-1

            	 	
              $

            	
              24,846,218.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              A-2

            	 	
              $

            	
              25,297,813.00

            	 	
              Variable
                Rate(3)

            	 	
              October
                18, 2036

            
	
              A-3(4)

            	 	
              $

            	
              25,297,813.00

            	 	
              0.39%

            	 	
              October
                18, 2036

            
	
              A-4

            	 	
              $

            	
              24,846,218.00

            	 	
              Variable
                Rate(5)

            	 	
              October
                18, 2036

            
	
              A-5

            	 	
              $

            	
              9,938,487.00

            	 	
              Variable
                Rate(6)

            	 	
              October
                18, 2036

            
	
              A-6

            	 	
              $

            	
              2,282,607.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              A-7

            	 	
              $

            	
              2,433,612.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              A-8

            	 	
              $

            	
              13,118,803.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              R-I

            	 	
              $

            	
              100.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              R-II

            	 	
              $

            	
              100.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              B-1

            	 	
              $

            	
              4,646,243.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              B-2

            	 	
              $

            	
              819,925.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              B-3

            	 	
              $

            	
              437,293.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              B-4

            	 	
              $

            	
              273,308.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              B-5

            	 	
              $

            	
              218,647.00

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            
	
              B-6

            	 	
              $

            	
              163,986.61

            	 	
              Variable
                Rate(2)

            	 	
              October
                18, 2036

            

    

    

    
      	
              (1)

            	
              For
                purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
                the
                Distribution Date in the month following the month of the maturity
                date
                for the Mortgage Loan with the latest maturity date has been designated
                as
                the “latest possible maturity date” for each Regular
                Certificate.

            
	 	 
	
              (2)

            	
              Varies
                according to the weighted average of the Net Mortgage Rate on each
                Mortgage Loan.

            
	 	 
	
              (3)

            	
              Varies
                according to (i) the weighted average of the Net Mortgage Rate on
                each
                Mortgage Loan minus (ii) 0.39% per annum.

            
	 	 
	
              (4)

            	
              For
                federal income tax purposes, the notional balance of the Class A-3
                Certificates will be equal the Uncertificated Principal Balance of
                REMIC I
                Regular Interest A-2.
                Interest
                will accrue on a Notional Amount as described herein. No principal
                will be
                paid on the Class A-3 Certificates.

            
	 	 
	
              (5)

            	
              Varies
                according to (i) the weighted average of the Net Mortgage Rate on
                each
                Mortgage Loan minus (ii) 0.58% per annum.

            
	 	 
	
              (6)

            	
              Varies
                according to (i) the weighted average of the Net Mortgage Rate on
                each
                Mortgage Loan plus (ii) 1.45% per
                annum.

            

    

    

    

     

    
 

    ARTICLE
      I

    DEFINITIONS

     

    Section
      1.01 Defined
      Terms.

     

    Whenever
      used in this Agreement or in the Preliminary Statement, the following words
      and
      phrases, unless the context otherwise requires, shall have the meanings
      specified in this Article. Unless otherwise specified, interest will be
      calculated for all Certificates on the basis of a 360-day year consisting of
      twelve 30-day months.

     

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

     

    “Account”:
      Any of the Collection Account and Distribution Account.

     

    “Accretion
      Termination Date”: With respect to the Class A-6 Certificates, the Class A-6
      Accretion Termination Date, with respect to the Class A-7 Certificates, the
      Class A-7 Accretion Termination Date and with respect to the Class A-8
      Certificates, the Class A-8 Accretion Termination Date.

     

    “Accrual
      Distribution Amount”: With respect to the Class A-6 Certificates, the Class A-6
      Accrual Distribution Amount, with respect to the Class A-7 Certificates, the
      Class A-7 Accretion Termination Date and with respect to the Class A-8
      Certificates, the Class A-8 Accrual Distribution Amount.

     

    “Advance”:
      As to any Mortgage Loan or REO Property, any advance made by the Master Servicer
      in respect of any Distribution Date pursuant to Section 4.03.

     

    “Adverse
      REMIC Event”: As defined in Section 9.01(f) hereof.

     

    “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.

     

    “Agreement”:
      This Pooling and Servicing Agreement and all amendments and supplements
      hereto.

     

    “Assessment
      of Compliance”: As defined in Section 3.21.

     

    “Attestation
      Report”: As defined in Section 3.21.

     

    “Assignment”:
      An assignment of Mortgage, notice of transfer or equivalent instrument, in
      recordable form, which is sufficient under the laws of the jurisdiction wherein
      the related Mortgaged Property is located to reflect or record the sale of
      the
      Mortgage.

     

    “Assumed
      Final Maturity Date”: As to each Class of Certificates, the date set forth as
      such in the Preliminary Statement.

     

    “Available
      Distribution Amount”: With respect to any Distribution Date and the Mortgage
      Loans, an amount equal to the excess of (i) the sum of (a) the aggregate of
      the
      related Monthly Payments received on or prior to the related Determination
      Date,
      (b) Liquidation Proceeds, Insurance Proceeds, Subsequent Recoveries and other
      unscheduled recoveries of principal and interest in respect of the Mortgage
      Loans, and Principal Prepayments during the related Prepayment Period, (c)
      the
      aggregate of any amounts received in respect of a related REO Property withdrawn
      from any REO Account and deposited in the Collection Account for such
      Distribution Date, (d) the aggregate of any amounts deposited in the Collection
      Account by the Master Servicer in respect of related Prepayment Interest
      Shortfalls for such Distribution Date and (e) the aggregate of any related
      Advances made by the Master Servicer for such Distribution Date, over (ii)
      the
      sum of (a) related amounts reimbursable or payable to the Master Servicer
      pursuant to Section 3.10, (b) related Stayed Funds, (c) related amounts
      deposited in the Collection Account or the Distribution Account, as the case
      may
      be, in error, (d) any Extraordinary Trust Fund Expenses and (e) the Trustee
      Fee.
      The Available Distribution Amount shall also be increased by any Required Surety
      Payment.

     

    “Bankruptcy
      Amount”: As of any date of determination prior to the first anniversary of the
      Cut-off Date, an amount equal to the excess, if any, of (A) $50,000 over (B)
      the
      aggregate amount of Bankruptcy Losses allocated solely to one or more specific
      Classes of Certificates in accordance with Section 4.02. As of any date of
      determination on or after the first anniversary of the Cut-off Date, an amount
      equal to the excess, if any, of (1) the lesser of (a) the Bankruptcy Amount
      calculated as of the close of business on the Business Day immediately preceding
      the most recent anniversary of the Cut-off Date coinciding with or preceding
      such date of determination (or, if such date of determination is an anniversary
      of the Cut-off Date, the Business Day immediately preceding such date of
      determination) (for purposes of this definition, the “Relevant Anniversary”) and
      (b) the greater of:

     

    (A) the
      greater of (i) 0.0006 times the aggregate principal balance of all the Mortgage
      Loans in the Mortgage Pool as of the Relevant Anniversary having a Loan-to-Value
      Ratio at origination which exceeds 75% and (ii) $50,000; and (B) the greater
      of
      (i) the product of (x) an amount equal to the largest difference in the related
      Monthly Payment for any Non-Primary Residence Loan remaining in the Mortgage
      Pool which had an original Loan-to-Value Ratio greater than 80% that would
      result if the Net Mortgage Rate thereof was equal to the greater of (I) 5%
      or
      (II) the weighted average (based on the principal balance of the Mortgage Loans
      as of the Relevant Anniversary) of the Net Mortgage Rates of all Mortgage Loans
      as of the Relevant Anniversary less 1.25% per annum, (y) a number equal to
      the
      weighted average remaining term to maturity, in months, of all Mortgage Loans
      with a Loan-to-Value Ratio of greater than 80% remaining in the Mortgage Pool
      as
      of the Relevant Anniversary, and (z) one plus the quotient of the number of
      all
      Non-Primary Residence Loans with a Loan-to-Value Ratio of greater than 80%
      remaining in the Mortgage Pool divided by the total number of outstanding
      Mortgage Loans in the Mortgage Pool as of the Relevant Anniversary, and (ii)
      $50,000,

     

    over
      (2)
      the aggregate amount of Bankruptcy Losses allocated solely to one or more
      specific Classes of Certificates in accordance with Section 4.02 since the
      Relevant Anniversary.

     

    The
      Bankruptcy Amount may be further reduced by the Master Servicer (including
      accelerating the manner in which such coverage is reduced) provided that prior
      to any such reduction, the Master Servicer shall (i) obtain written confirmation
      from the Rating Agency that such reduction shall not reduce the rating assigned
      to any Class of Certificates by such Rating Agency below the lower of the then
      current rating or the rating assigned to such Certificates as of the Closing
      Date by such Rating Agency and (ii) provide a copy of such written confirmation
      to the Trustee.

     

    “Bankruptcy
      Code”: The Bankruptcy Reform Act of 1978 (Title 11 of the United States Code),
      as amended.

     

    “Bankruptcy
      Losses”: Losses that are incurred as a result of Debt Service Reductions and
      Deficient Valuations.

     

    “Book-Entry
      Certificates”: Any of the Certificates that shall be registered in the name of
      the Depository or its nominee, the ownership of which is reflected on the books
      of the Depository or on the books of a Person maintaining an account with the
      Depository (directly, as a “Depository Participant”, or indirectly, as an
      indirect participant in accordance with the rules of the Depository and as
      described in Section 5.02 hereof). On the Closing Date, the Certificates (other
      than the Class R, Class B-4, Class B-5 and Class B-6 Certificates) shall be
      Book-Entry Certificates.

     

    “Business
      Day”: Any day other than (a) a Saturday or Sunday, (b) a legal holiday in the
      State of New Jersey or the State of New York, or (c) a day on which banking
      or
      savings and loan institutions in the State of New Jersey or the State of New
      York are authorized or obligated by law or executive order to be
      closed.

     

    “Buydown
      Account”: The custodial account or accounts created and maintained pursuant to
      Section 3.25.

     

    “Buydown
      Agreement”: An agreement between the applicable originator and a Mortgagor, or
      an agreement among such originator, a Mortgagor and an employer of a relocated
      Mortgagor which, in each case, provides for the application of Buydown
      Funds.

     

    “Buydown
      Funds”: In respect of any Buydown Mortgage Loan, any amount contributed by the
      related originator or the employer of a relocated borrower in order to enable
      the Mortgagor to reduce the payments required to be made from the Mortgagor’s
      funds during the Buydown Period. The Buydown Funds are not part of the Trust
      Fund prior to deposit into the Collection Account or the Distribution
      Account.

     

    “Buydown
      Mortgage Loan”: Any Mortgage Loan in respect of which, pursuant to a Buydown
      Agreement, (i) the Mortgagor pays less than the full monthly payment specified
      in the Mortgage Note during the Buydown Period and (ii) the difference between
      the payments required under such Buydown Agreement and the Mortgage Note is
      paid
      from the related Buydown Funds.

     

    “Buydown
      Period”: The period during which Buydown Funds are required to be applied to the
      related Buydown Mortgage Loans as provided in Section 3.25.

     

    “Cash-Out
      Refinancing”: A Refinanced Mortgage Loan the proceeds of which were more than 2%
      or $2,000 in excess of the principal balance of any existing first mortgage
      or
      seasoned subordinate mortgage on the related Mortgaged Property and related
      closing costs.

     

    “Cash
      Liquidation”: As to any defaulted Mortgage Loan other than REO Property which
      has been acquired by the Master Servicer on behalf of the Trustee for the
      benefit of the Certificateholders, a determination by the Master Servicer that
      it has received all Insurance Proceeds, Liquidation Proceeds and other payments
      or cash recoveries which the Master Servicer reasonably or in good faith expects
      to be finally recoverable with respect to such Mortgage Loan, plus, with respect
      to a defaulted Mortgage Loan that is a Pledged Asset Loan, the amount realized
      on the related Pledged Assets with respect to such Mortgage Loan in accordance
      with Section 3.16.

     

    “Certificate”:
      Any Regular Certificate or Class R Certificate.

     

    “Certificateholder”
      or “Holder”: The Person in whose name a Certificate is registered in the
      Certificate Register, except that a Disqualified Organization or non-U.S. Person
      shall not be a Holder of a Class R Certificate for any purpose
      hereof.

     

    “Certificate
      Owner”: With respect to each Book-Entry Certificate, any beneficial owner
      thereof.

     

    “Certificate
      Principal Balance”: With respect to any Certificate (other than any Class A-3
      Certificate) as of any date of determination, (x) the Certificate Principal
      Balance of such Certificate on the Distribution Date immediately prior to such
      date of determination, plus (y) (i) in the case of the Class A-6 Certificates,
      an amount equal to the Monthly Interest Distributable Amount added to the
      Certificate Principal Balance of the Class A-6 Certificates on the Distribution
      Date immediately prior to such date of determination on or prior to the Class
      A-6 Accretion Termination Date, (ii) in the case of the Class A-7 Certificates,
      an amount equal to the Monthly Interest Distributable Amount added to the
      Certificate Principal Balance of the Class A-7 Certificates on the Distribution
      Date immediately prior to such date of determination on or prior to the Class
      A-7 Accretion Termination Date and (iii) in the case of the Class A-8
      Certificates, an amount equal to the Monthly Interest Distributable Amount
      added
      to the Certificate Principal Balance of the Class A-8 Certificates on the
      Distribution Date immediately prior to such date of determination on or prior
      to
      the Class A-8 Accretion Termination Date plus (z) in the case of the Class
      B
      Certificates, any Subsequent Recoveries added to the Certificate Principal
      Balance of any such Certificate pursuant to Section 4.01(g), reduced by the
      aggregate of (a) all distributions of principal made thereon on such immediately
      prior Distribution Date and (b) without duplication of amounts described in
      clause (a) above, reductions in the Certificate Principal Balance thereof in
      connection with allocations thereto of Realized Losses on the Mortgage Loans
      and
      Extraordinary Trust Fund Expenses on such immediately prior Distribution Date
      (or, in the case of any date of determination up to and including the initial
      Distribution Date, the initial Certificate Principal Balance of such
      Certificate, as stated on the face thereon); provided, however, that the
      Certificate Principal Balance of each Subordinate Certificate of the Class
      of
      Subordinate Certificates outstanding with the highest numerical designation
      at
      any given time shall be calculated to equal the Percentage Interest evidenced
      by
      such Certificate multiplied by the excess, if any, of (A) the then aggregate
      Stated Principal Balance of the Mortgage Loans over (B) the then aggregate
      Certificate Principal Balances of all other Classes of Certificates then
      outstanding. The Class A-3 Certificates shall not have a Certificate Principal
      Balance and shall not be entitled to any distributions of
      principal.

     

    “Certificate
      Register” and “Certificate Registrar”: The register maintained and registrar
      appointed pursuant to Section 5.02 hereof.

     

    “Class”:
      Collectively, Certificates which have the same priority of payment and bear
      the
      same class designation and the form of which is identical except for variation
      in the Percentage Interest evidenced thereby.

     

    “Class
      A
      Certificate”: Any of the Class A-1, Class A-2, Class A-3, Class A-4, Class A-5,
      Class A-6, Class A-7 or Class A-8 Certificates as designated on the face thereof
      substantially in the form annexed hereto as Exhibit A, executed by the Trustee
      and authenticated and delivered by the Trustee, representing the right to
      distributions as set forth herein and therein.

     

    “Class
      A
      Certificateholder”: Any Holder of a Class A Certificate.

     

    “Class
      A-6 Accretion Termination Date”: The earlier to occur of (i) the Distribution
      Date on which the aggregate Certificate Principal Balance of the Class A-4
      Certificates and Class A-5 Certificates has been reduced to zero and (ii) the
      Credit Support Depletion Date.

     

    “Class
      A-6 Accrual Distribution Amount”: With respect to each Distribution Date prior
      to the Class A-6 Accretion Termination Date, an amount equal to the aggregate
      amount of Monthly Interest Distributable Amount on the Class A-6 Certificates,
      for such date, to the extent added to the Certificate Principal Balance thereof
      pursuant to Section 4.01(i); provided that, with respect to each Distribution
      Date on or after the Class A-6 Accretion Termination Date, the Monthly Interest
      Distributable Amount on the Class A-6 Certificates for such date remaining
      after
      reduction of the aggregate Certificate Principal Balance of the Class A-4
      Certificates and Class A-5 Certificates to zero on the Class A-6 Accretion
      Termination Date will be payable to the Class A-6 Certificateholders pursuant
      to
      Section 4.01(c)(i) hereof; and provided further, that if the Class A-6 Accretion
      Termination Date is the Credit Support Depletion Date, the entire amount of
      Monthly Interest Distributable Amount on the Class A-6 Certificates for that
      date will be payable to the Class A-6 Certificateholders pursuant to Section
      4.01(c)(i) hereof.

     

    “Class
      A-7 Accretion Termination Date”: The earlier to occur of (i) the Distribution
      Date on which the aggregate Certificate Principal Balance of the Class A-1,
      Class A-2, Class A-4, Class A-5 and Class A-6 Certificates has been reduced
      to
      zero and (ii) the Credit Support Depletion Date.

     

    “Class
      A-7 Accrual Distribution Amount”: With respect to each Distribution Date prior
      to the Class A-7 Accretion Termination Date, an amount equal to the aggregate
      amount of Monthly Interest Distributable Amount on the Class A-7 Certificates,
      for such date, to the extent added to the Certificate Principal Balance thereof
      pursuant to Section 4.01(j); provided that, with respect to each Distribution
      Date on or after the Class A-7 Accretion Termination Date, the Monthly Interest
      Distributable Amount on the Class A-7 Certificates for such date remaining
      after
      reduction of the aggregate Certificate Principal Balance of the Class A-1,
      Class
      A-2, Class A-4, Class A-5 and Class A-6 Certificates to zero on the Class A-7
      Accretion Termination Date will be payable to the Class A-7 Certificateholders
      pursuant to Section 4.01(c)(i) hereof; and provided further, that if the Class
      A-7 Accretion Termination Date is the Credit Support Depletion Date, the entire
      amount of Monthly Interest Distributable Amount on the Class A-7 Certificates
      for that date will be payable to the Class A-7 Certificateholders pursuant
      to
      Section 4.01(c)(i) hereof.

     

    “Class
      A-8 Accretion Termination Date”: The earliest to occur of (i) the Distribution
      Date on which the aggregate Certificate Principal Balance of the Class A-1,
      Class A-2, Class A-4, Class A-5, Class A-6 and Class A-7 Certificates has been
      reduced to zero, (ii) the Credit Support Depletion Date and (iii) the
      Distribution Date occurring in October 2011.

     

    “Class
      A-8 Accrual Distribution Amount”: With respect to each Distribution Date prior
      to the Class A-8 Accretion Termination Date, an amount equal to the aggregate
      amount of Monthly Interest Distributable Amount on the Class A-8 Certificates,
      for such date, to the extent added to the Certificate Principal Balance thereof
      pursuant to Section 4.01(k); provided that, with respect to each Distribution
      Date on or after the Class A-8 Accretion Termination Date, the Monthly Interest
      Distributable Amount on the Class A-8 Certificates for such date remaining
      after
      reduction of the aggregate Certificate Principal Balance of the Class A-1,
      Class
      A-2, Class A-4, Class A-5, Class A-6 and Class A-7 Certificates to zero on
      the
      Class A-8 Accretion Termination Date will be payable to the Class A-8
      Certificateholders pursuant to Section 4.01(c)(i) hereof; and provided further,
      that if the Class A-8 Accretion Termination Date is the Credit Support Depletion
      Date or the Distribution Date occurring in October 2011, the entire amount
      of
      Monthly Interest Distributable Amount on the Class A-8 Certificates for that
      date will be payable to the Class A-8 Certificateholders pursuant to Section
      4.01(c)(i) hereof.

     

    “Class
      B
      Certificate”: Any one of the Class B-1, Class B-2, Class B-3, Class B-4, Class
      B-5 or Class B-6 Certificates as designated on the face thereof substantially
      in
      the form annexed hereto as Exhibit C-2, executed by the Trustee and
      authenticated and delivered by the Trustee, representing the right to
      distributions as set forth herein and therein.

     

    “Class
      B
      Certificateholder”: Any Holder of a Class B Certificate.

     

    “Class
      B
      Percentage”: The Class B-1 Percentage, Class B-2 Percentage, Class B-3
      Percentage, Class B-4 Percentage, Class B-5 Percentage or Class B-6
      Percentage.

     

    “Class
      B-1 Percentage”: With respect to any Distribution Date, the lesser of 100% and a
      fraction, expressed as a percentage, the numerator of which is the aggregate
      Certificate Principal Balance of the Class B-1 Certificates immediately prior
      to
      such Distribution Date and the denominator of which is the aggregate Stated
      Principal Balance of all of the Mortgage Loans (or related REO Properties)
      immediately prior to such Distribution Date. The initial Class B-1 Percentage
      is
      approximately 4.25%.

     

    “Class
      B-2 Percentage”: With respect to any Distribution Date, the lesser of 100% and a
      fraction, expressed as a percentage, the numerator of which is the aggregate
      Certificate Principal Balance of the Class B-2 Certificates immediately prior
      to
      such Distribution Date and the denominator of which is the aggregate Stated
      Principal Balance of all of the Mortgage Loans (or related REO Properties)
      immediately prior to such Distribution Date. The initial Class B-2 Percentage
      is
      approximately 0.75%.

     

    “Class
      B-3 Percentage”: With respect to any Distribution Date, the lesser of 100% and a
      fraction, expressed as a percentage, the numerator of which is the aggregate
      Certificate Principal Balance of the Class B-3 Certificates immediately prior
      to
      such Distribution Date and the denominator of which is the aggregate Stated
      Principal Balance of all of the Mortgage Loans (or related REO Properties)
      immediately prior to such Distribution Date. The initial Class B-3 Percentage
      is
      approximately 0.40%.

     

    “Class
      B-4 Percentage”: With respect to any Distribution Date, the lesser of 100% and a
      fraction, expressed as a percentage, the numerator of which is the aggregate
      Certificate Principal Balance of the Class B-4 Certificates immediately prior
      to
      such Distribution Date and the denominator of which is the aggregate Stated
      Principal Balance of all of the Mortgage Loans (or related REO Properties)
      immediately prior to such Distribution Date. The initial Class B-4 Percentage
      is
      approximately 0.25%.

     

    “Class
      B-5 Percentage”: With respect to any Distribution Date, the lesser of 100% and a
      fraction, expressed as a percentage, the numerator of which is the aggregate
      Certificate Principal Balance of the Class B-5 Certificates immediately prior
      to
      such Distribution Date and the denominator of which is the aggregate Stated
      Principal Balance of all of the Mortgage Loans (or related REO Properties)
      immediately prior to such Distribution Date. The initial Class B-5 Percentage
      is
      approximately 0.20%.

     

    “Class
      B-6 Percentage”: With respect to any Distribution Date, the lesser of 100% and a
      fraction, expressed as a percentage, the numerator of which is the aggregate
      Certificate Principal Balance of the Class B-6 Certificates immediately prior
      to
      such Distribution Date and the denominator of which is the aggregate Stated
      Principal Balance of all of the Mortgage Loans (or related REO Properties)
      immediately prior to such Distribution Date. The initial Class B-6 Percentage
      is
      approximately 0.15%.

     

    “Class
      R
      Certificates”: The Class R-I Certificates and Class R-II Certificates executed
      by the Trustee, and authenticated and delivered by the Certificate Registrar,
      substantially in the form annexed hereto as Exhibit C-1 and each evidencing
      the
      ownership of an interest designated as the Residual Interest in the related
      REMIC.

     

    “Class
      Subordination Percentage”: With respect to any Distribution Date and each Class
      of Subordinate Certificates, the fraction (expressed as a percentage) the
      numerator of which is the Certificate Principal Balance of such Class of
      Subordinate Certificates immediately prior to such Distribution Date and the
      denominator of which is the aggregate of the Certificate Principal Balances
      of
      all Classes of Certificates immediately prior to such Distribution
      Date.

     

    “Closing
      Date”: September 28, 2006.

     

    “Code”:
      The Internal Revenue Code of 1986, as amended.

     

    “Collection
      Account”: The account or accounts created and maintained by the Master Servicer
      pursuant to Section 3.10, which shall be entitled “PHH Mortgage Corporation, as
      Master Servicer for Citibank, N.A., as Trustee, in trust for registered Holders
      of PHHMC Mortgage Pass-Through Certificates, Series 2006-3”, and which must be
      an Eligible Account.

     

    “Commission”:
      The Securities and Exchange Commission.

     

    “Compensating
      Interest”: As defined in Section 3.24 hereof.

     

    “Condemnation
      Proceeds”: All awards or settlements in respect of a taking of a Mortgaged
      Property by exercise of the power of eminent domain or
      condemnation.

     

    “Control
      Agreement”: With respect to each Mortgage 100K
      Loan,
      the Merrill Lynch Pledged Collateral Account Control Agreement between the
      guarantor or mortgagor, as applicable, the Pledged Asset Servicer and Merrill
      Lynch, Pierce, Fenner & Smith Incorporated, pursuant to which the guarantor
      or mortgagor, as applicable, has granted a security interest in a Securities
      Account.

     

    “Cooperative”:
      A corporation that has been formed for the purpose of cooperative apartment
      ownership.

     

    “Cooperative
      Assets”: Shares issued by Cooperatives, the related Cooperative Lease and any
      other collateral securing the Cooperative Loans.

     

    “Cooperative
      Building”: The building and other property owned by a Cooperative.

     

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

     

    “Cooperative
      Loan”: The indebtedness of a Mortgagor evidenced by a Mortgage Note which is
      secured by Cooperative Assets and which is being sold to the Depositor pursuant
      to this Agreement, the Mortgage Loans so sold being identified in the Mortgage
      Loan Schedule.

     

    “Cooperative
      Unit”: A specific dwelling unit in a Cooperative Building as to which exclusive
      occupancy rights have been granted pursuant to a Lease.

     

    “Corporate
      Trust Office”: The principal corporate trust office of the Trustee at which at
      any particular time its corporate trust business in connection with this
      Agreement shall be administered, which office at the date of the execution
      of
      this instrument is located, for Certificate transfer purposes, at 111 Wall
      Street, 15th
      Floor,
      Attn: Securities Window, New York, New York 10005, Attn: PHHMC, Series 2006-3,
      or at such other address as the Trustee may designate from time to time by
      notice to the Certificateholders, the Depositor and the Master
      Servicer.

     

    “Corresponding
      Certificated Interests”: With respect to each REMIC I Regular Interest, the
      Class with the same designation.

     

    “Credit
      Support Depletion Date”: The first Distribution Date on which the Senior
      Percentage equals 100%.

     

    “Curtailment”:
      Any Principal Prepayment made by a Mortgagor which is not a Principal Prepayment
      in Full.

     

    “Cut-off
      Date”: September 1, 2006.

     

    “Cut-off
      Date Principal Balance”: With respect to any Mortgage Loan, the unpaid principal
      balance thereof as of the Cut-off Date (or as of the applicable date of
      substitution with respect to an Eligible Substitute Mortgage Loan).

     

    “Debt
      Service Reduction”: With respect to any Mortgage Loan, a reduction in the
      scheduled Monthly Payment for such Mortgage Loan by a court of competent
      jurisdiction in a proceeding under the Bankruptcy Code, except such a reduction
      resulting from a Deficient Valuation.

     

    “Defective
      Mortgage Loan”: A Mortgage Loan replaced or to be replaced by one or more
      Eligible Substitute Mortgage Loans.

     

    “Deficient
      Valuation”: With respect to any Mortgage Loan, a valuation of the related
      Mortgaged Property by a court of competent jurisdiction in an amount less than
      the then outstanding principal balance of the Mortgage Loan, which valuation
      results from a proceeding initiated under the Bankruptcy Code.

     

    “Definitive
      Certificates”: As defined in Section 5.02(c) hereof.

     

    “Delinquent”:
      As used herein, a Mortgage Loan is considered to be: “one month” delinquent when
      a payment due on any scheduled due date remains unpaid as of the close of
      business on the last Business Day immediately prior to the next following
      monthly scheduled due date; “two months” delinquent when a payment due on any
      scheduled due date remains unpaid as of the close of business on the last
      Business Day immediately prior to the second following monthly scheduled due
      date; and so on. The determination as to whether a Mortgage Loan falls into
      these categories is made as of the close of business on the last Business Day
      of
      each month. For example, a Mortgage Loan with a payment due on July 1 that
      remained unpaid as of the close of business on July 31 would then be considered
      to be one month 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”:
      PHH Mortgage Capital LLC, a Delaware limited liability company, or any successor
      in interest.

     

    “Depository”:
      The initial Depository shall be The Depository Trust Company, whose nominee
      is
      Cede & Co., or any other organization registered as a “clearing agency”
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended.
      The
      Depository shall initially be the registered Holder of the Book-Entry
      Certificates. The Depository shall at all times be a “clearing corporation” as
      defined in Section 8-102(3) of the Uniform Commercial Code of the State of
      New
      York.

     

    “Depository
      Agreement”: With respect to any Book-Entry Certificates, either of the
      agreements among the Depositor, the Trustee and the initial Depository, to
      be
      dated on or about the Closing Date.

     

    “Depository
      Participant”: A broker, dealer, bank or other financial institution or other
      person for whom from time to time a Depository effects book-entry transfers
      and
      pledges of securities deposited with the Depository.

     

    “Determination
      Date”: With respect to any Distribution Date, the 8th day of the calendar month
      in which such Distribution Date occurs or, if such 8th day is not a Business
      Day, the Business Day immediately preceding such 8th day.

     

    “Directly
      Operate”: With respect to any REO Property, the furnishing or rendering of
      services to the tenants thereof, the management or operation of such REO
      Property, the holding of such REO Property primarily for sale to customers,
      the
      performance of any construction work thereon or any use of such REO Property
      in
      a trade or business conducted by the Trust Fund other than through an
      Independent Contractor, provided, however, that the Trustee (or the Master
      Servicer on behalf of the Trustee) shall not be considered to Directly Operate
      an REO Property solely because the Trustee (or the Master Servicer on behalf
      of
      the Trustee) establishes rental terms, chooses tenants, enters into or renews
      leases, deals with taxes and insurance, or makes decisions as to repairs or
      capital expenditures with respect to such REO Property.

     

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

     

    “Distribution
      Account”: The trust account or accounts created and maintained by the Trustee
      pursuant to Section 3.10(b) which shall be entitled “Distribution Account,
      Citibank, N.A., as Trustee, in trust for the registered Holders of the PHHMC
      Mortgage Pass-Through Certificates, Series 2006-3” and which must be an Eligible
      Account.

     

    “Distribution
      Date”: The 18th day of any calendar month, or if such 18th day is not a Business
      Day, the Business Day immediately following such 18th day, commencing in October
      2006.

     

    “Due
      Date”: With respect to each Mortgage Loan and any Distribution Date, the first
      day of the calendar month in which such Distribution Date occurs on which the
      Monthly Payment for such Mortgage Loan was due, exclusive of any days of
      grace.

     

    “Due
      Period”: With respect to any Distribution Date, the period commencing on the
      second day of the month preceding the month in which such Distribution Date
      (or
      with respect to the first Due Period, the day following the Cut-off Date) occurs
      and ending on the first day of the month in which such Distribution Date
      occurs.

     

    “Effective
      Loan-to-Value Ratio”: With respect to a Pledged Asset Loan, the ratio, expressed
      as a percentage, of (A) the principal amount of the Mortgage Loan at origination
      less the value of any Pledged Assets securing the Mortgage Loan, to (B) the
      lesser of (1) the appraised value determined in an appraisal or other collateral
      assessment tool obtained at origination of the Mortgage Loan and (2) the sales
      price for the related Mortgaged Property.

     

    “Eligible
      Account”: Any of (i) an account or accounts maintained with a depository
      institution the short-term debt obligations of which have been rated by the
      Rating Agency in its highest rating available, (ii) 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
      the
      Rating Agency, as evidenced in writing, be maintained such that (as evidenced
      by
      an Opinion of Counsel delivered to the Trustee and the Rating Agency) the
      registered Holders of Certificates have 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, (iii) a trust account or
      accounts maintained with the trust department of a federal or state chartered
      depository institution, national banking association or trust company acting
      in
      its fiduciary capacity, (iv) an account or accounts of a depository institution
      acceptable to the Rating Agency (as evidenced in writing by the Rating Agency
      that use of any such account will not reduce the rating assigned to any Class
      of
      Certificates by such Rating Agency below the lower of the then-current rating
      or
      the rating assigned to such Certificates as of the Closing Date by such Rating
      Agency) or (v) an account or accounts maintained with a federal or state
      chartered depository institution or trust company that meet the depository
      requirements of Fannie Mae or Freddie Mac. Eligible Accounts may bear
      interest.

     

    “Eligible
      Substitute Mortgage Loan”: A mortgage loan substituted for a Defective Mortgage
      Loan pursuant to the terms of this Agreement which must, on the date of such
      substitution, (i) have an outstanding principal balance, after application
      of
      all scheduled payments of principal and interest due during or prior to the
      month of substitution, not in excess of the outstanding principal balance of
      the
      Defective Mortgage Loan as of the Due Date in the calendar month during which
      the substitution occurs, the amount of any shortfall to be deposited by the
      Master Servicer in the Collection Account in the month of substitution, (ii)
      have a Loan Rate, not less than the Loan Rate of the Defective Mortgage Loan
      and
      not more than 1% in excess of the Loan Rate of such Defective Mortgage Loan,
      (iii) have a remaining term to maturity not greater than (and not more than
      one
      year less than) that of the Defective Mortgage Loan, (iv) be current as of
      the
      date of substitution, (v) have a Loan-to-Value Ratio as of the date of
      substitution equal to or lower than the Loan-to-Value Ratio of the Defective
      Mortgage Loan as of such date and (vi) conform to each representation and
      warranty set forth in Section 2.04 hereof applicable to the Defective Mortgage
      Loan. In the event that one or more mortgage loans are substituted for one
      or
      more Defective Mortgage Loans, the amounts described in clause (i) hereof shall
      be determined on the basis of aggregate principal balances, the Loan Rates
      described in clause (ii) hereof shall be determined on the basis of weighted
      average Loan Rates, the terms described in clause (iii) hereof shall be
      determined on the basis of weighted average remaining term to maturity, the
      Loan-to-Value Ratios described in clause (v) hereof shall be satisfied as to
      each such mortgage loan and, except to the extent otherwise provided in this
      sentence, the representations and warranties described in clause (vi) hereof
      must be satisfied as to each Eligible Substitute Mortgage Loan or in the
      aggregate, as the case may be. Any Mortgage Loan substituted for a Mortgage
      Loan
      which has an arrearage due to the application of any related forbearance plan
      with respect to such Mortgage Loan, will be treated as having such an arrearage
      due to the application of any related forbearance plan with respect to such
      Mortgage Loan.

     

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

     

    “ERISA-Restricted
      Certificates”: Any of the Class B-4, Class B-5, Class B-6 and Class R
      Certificates.

     

    “Escrow
      Payments”: The amounts constituting ground rents, taxes, assessments, water
      rates, mortgage insurance premiums, fire and hazard insurance premiums and
      other
      payments required to be escrowed by the Mortgagor with the mortgagee pursuant
      to
      any Mortgage Loan.

     

    “Estate
      in Real Property”: A fee simple estate in a parcel of real
      property.

     

    “Excess
      Losses”: (i) Special Hazard Losses in excess of the Special Hazard Amount, (ii)
      Bankruptcy Losses in excess of the Bankruptcy Amount, (iii) Fraud Losses in
      excess of the Fraud Loss Amount and (iv) Extraordinary Losses.

     

    “Excess
      Subordinate Principal Amount”: With respect to any Distribution Date on which
      the Certificate Principal Balance of the Class or Classes of Certificates then
      outstanding with the Lowest Priority is to be reduced to zero and on which
      Realized Losses are to be allocated to that Class or those Classes, the amount,
      if any, by which (i) the amount of principal that would otherwise be
      distributable on that Class or those Classes of Certificates on such
      Distribution Date is greater than (ii) the excess, if any, of the aggregate
      Certificate Principal Balance of that Class or those Classes of Certificates
      immediately prior to such Distribution Date over the aggregate amount of
      Realized Losses to be allocated to that Class or those Classes of Certificates
      on such Distribution Date.

     

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

     

    “Extraordinary
      Loss”: Any Realized Loss or portion thereof caused by or resulting
      from:

     

    (i) nuclear
      or chemical reaction or nuclear radiation or radioactive or chemical
      contamination, all whether controlled or uncontrolled and whether such loss
      be
      direct or indirect, proximate or remote or be in whole or in part caused by,
      contributed to or aggravated by a peril covered by the definition of the term
      “Special Hazard Loss”;

     

    (ii) hostile
      or warlike action in time of peace or war, including action in hindering,
      combating or defending against an actual, impending or expected attack by any
      government or sovereign power, de
      jure
      or
de
      facto,
      or by
      any authority maintaining or using military, naval or air forces, or by
      military, naval or air forces, or by an agent of any such government, power,
      authority or forces;

     

    (iii) any
      weapon of war employing atomic fission or radioactive forces whether in time
      of
      peace or war, and

     

    (iv) insurrection,
      rebellion, revolution, civil war, usurped power or action taken by governmental
      authority in hindering, combating or defending against such an occurrence,
      seizure or destruction under quarantine or customs regulations, confiscation
      by
      order of any government or public authority, or risks of contraband or illegal
      transactions or trade.

     

    “Extraordinary
      Trust Fund Expenses”: Any amounts reimbursable to the Master Servicer or the
      Depositor pursuant to Section 6.03, any amounts reimbursable to the Trustee
      from
      the Trust Fund pursuant to this Agreement, including but not limited to Section
      8.05, and any other costs, expenses, liabilities and losses borne by the Trust
      Fund (exclusive of any cost, expense, liability or loss that is specific to
      a
      particular Mortgage Loan or REO Property and is taken into account in
      calculating a Realized Loss in respect thereof) for which the Trust Fund has
      not
      and, in the reasonable good faith judgment of the Trustee, shall not, obtain
      reimbursement or indemnification from any other Person.

     

    “Fannie
      Mae”: Federal National Mortgage Association or any successor
      thereto.

     

    “FDIC”:
      Federal Deposit Insurance Corporation or any successor thereto.

     

    “Fidelity
      Bond”: Shall have the meaning assigned thereto in Section 3.14.

     

    “Final
      Recovery Determination”: With respect to any defaulted Mortgage Loan or any REO
      Property (other than a Mortgage Loan or REO Property purchased by a Seller
      or
      the Master Servicer pursuant to or as contemplated by Section 2.03 or 10.01),
      a
      determination made by the Master Servicer that all Insurance Proceeds,
      Liquidation Proceeds and other payments or recoveries which the Master Servicer,
      in its reasonable good faith judgment, expects to be finally recoverable in
      respect thereof have been so recovered. The Master Servicer shall maintain
      records, prepared by a Servicing Officer, of each Final Recovery Determination
      made thereby.

     

    “Fitch”:
      Fitch, Inc., doing business as Fitch Ratings, and any successor thereto or
      its
      successor in interest.

     

    “Foreclosure
      Price”: The amount reasonably expected to be received from the sale of the
      related Mortgaged Property net of any expenses associated with foreclosure
      proceedings.

     

    “Foreclosure
      Profits”: As to any Distribution Date or related Determination Date and any
      Mortgage Loan, the excess, if any, of Liquidation Proceeds, Insurance Proceeds
      and proceeds from any REO Disposition (net of all amounts reimbursable therefrom
      pursuant to Section 3.11(a)(iii)) in respect of each Mortgage Loan or REO
      Property for which a Cash Liquidation or REO Disposition occurred in the related
      Prepayment Period over the sum of the unpaid principal balance of such Mortgage
      Loan or REO Property (determined, in the case of an REO Disposition, in
      accordance with Section 3.16) plus accrued and unpaid interest at the Mortgage
      Rate on such unpaid principal balance from the Due Date to which interest was
      last paid by the Mortgagor to the first day of the month following the month
      in
      which such Cash Liquidation or REO Disposition occurred.

     

    “Fraud
      Loss Amount”: As of any date of determination after the Cut-off Date, prior to
      the third anniversary of the Cut-off Date, an amount equal to 1.00% of the
      aggregate outstanding principal balance of all of the Mortgage Loans as of
      the
      Cut-off Date minus the Fraud Losses allocated solely to one or more specific
      Classes of Certificates in accordance with Section 4.02 since the most recent
      anniversary of the Cut-off Date up to such date of determination. On and after
      the third anniversary of the Cut-off Date, the Fraud Loss Amount shall be
      zero.

     

    The
      Fraud
      Loss Amount may be further reduced by the Master Servicer (including
      accelerating the manner in which such coverage is reduced) provided that prior
      to any such reduction, the Master Servicer shall (i) obtain written conformation
      from the Rating Agency that such reduction shall not reduce the rating assigned
      to any Class of Certificates by such Rating Agency below the lower of the
      then-current rating or the rating assigned to such Certificates as of the
      Closing Date by such Rating Agency and (ii) provide a copy of such written
      conformation to the Trustee.

     

    “Fraud
      Losses”: Losses sustained on a Liquidated Mortgage Loan by reason of a default
      arising from fraud, dishonesty or misrepresentation.

     

    “Freddie
      Mac”: Federal Home Loan Mortgage Corporation or any successor
      thereto.

     

    “Highest
      Priority”: As of any date of determination, the Class of Subordinate
      Certificates then outstanding with the earliest priority for payments pursuant
      to Section 4.01(c), in the following order: Class B-1, Class B-2, Class B-3,
      Class B-4, Class B-5 and Class B-6 Certificates.

     

    “HUD”:
      The United States Department of Housing and Urban Development, or any successor
      thereto and including the Federal Housing Commissioner and the Secretary of
      Housing and Urban Development where appropriate under the FHA
      Regulations.

     

    “Independent”:
      When used with respect to any specified Person, any such Person who (a) is
      in
      fact independent of the Depositor, the Master Servicer and their respective
      Affiliates, (b) does not have any direct financial interest in or any material
      indirect financial interest in the Depositor or the Master Servicer or any
      Affiliate thereof, and (c) is not connected with the Depositor or the Master
      Servicer or any Affiliate thereof as an officer, employee, promoter,
      underwriter, trustee, partner, director or Person performing similar functions;
      provided,
      however,
      that a
      Person shall not fail to be Independent of the Depositor or the Master Servicer
      or any Affiliate thereof merely because such Person is the beneficial owner
      of
      1% or less of any class of securities issued by the Depositor or the Master
      Servicer or any Affiliate thereof, as the case may be.

     

    “Independent
      Contractor”: Either (i) any Person (other than the Master Servicer) that would
      be an “independent contractor” with respect to the Trust Fund within the meaning
      of Section 856(d)(3) of the Code if the Trust Fund were a real estate investment
      trust (except that the ownership tests set forth in that section shall be
      considered to be met by any Person that owns, directly or indirectly, 35 percent
      or more of any Class of Certificates), so long as the Trust Fund does not
      receive or derive any income from such Person and provided that the relationship
      between such Person and the Trust Fund is at arm’s length, all within the
      meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any other Person
      (including the Master Servicer) if the Trustee has received an Opinion of
      Counsel, which Opinion of Counsel shall be an expense of the Trust Fund, to
      the
      effect that the taking of any action in respect of any REO Property by such
      Person, subject to any conditions therein specified, that is otherwise herein
      contemplated to be taken by an Independent Contractor will not cause such REO
      Property to cease to qualify as “foreclosure property” within the meaning of
      Section 860G(a)(8) of the Code (determined without regard to the exception
      applicable for purposes of Section 860D(a) of the Code), or cause any income
      realized in respect of such REO Property to fail to qualify as rents from real
      property.

     

    “Initial
      Certificate Principal Balance”: With respect to any Regular Certificate, other
      than the Class A-3 Certificates, the amount designated “Initial Certificate
      Principal Balance” on the face thereof.

     

    “Insurance
      Proceeds”: Proceeds of any title policy, hazard policy or other insurance policy
      covering a Mortgage Loan, to the extent such proceeds are not to be applied
      to
      the restoration of the related Mortgaged Property or released to the Mortgagor
      in accordance with the procedures that the Master Servicer would follow in
      servicing mortgage loans held for its own account, subject to the terms and
      conditions of the related Mortgage Note and Mortgage.

     

    “Interest
      Accrual Period”: With respect to any Distribution Date and any Class of
      Certificates, the calendar month immediately preceding the month in which such
      Distribution Date occurs.

     

    “Late
      Collections”: With respect to any Mortgage Loan, all amounts received subsequent
      to the Determination Date immediately following any related Due Period, whether
      as late payments of Monthly Payments or as Insurance Proceeds, Liquidation
      Proceeds or otherwise, which represent late payments or collections of principal
      and/or interest due (without regard to any acceleration of payments under the
      related Mortgage and Mortgage Note) but delinquent on a contractual basis for
      such Due Period and not previously recovered.

     

    “Limited
      Purpose Surety Bond”: The Limited Purpose Surety Bond (Policy No. AB0039BE),
      dated February 28, 1996 in respect to certain Pledged Asset Loans, issued by
      Ambac Assurance Corporation (f/k/a Ambac Indemnity Corporation) for the benefit
      of certain beneficiaries, including the Trustee for the benefit of the
      Certificateholders, but only to the extent that such Limited Purpose Surety
      Bond
      covers any Pledged Asset Loans.

     

    “Liquidated
      Mortgage Loan”: As to any Distribution Date, any Mortgage Loan in respect of
      which the Master Servicer has determined, in accordance with the servicing
      procedures specified herein, as of the end of the related Due Period, that
      all
      Liquidation Proceeds and Insurance Proceeds which it expects to recover with
      respect to the liquidation of the Mortgage Loan or disposition of the related
      REO Property have been recovered.

     

    “Liquidation
      Event”: With respect to any Mortgage Loan, any of the following events: (i) such
      Mortgage Loan is paid in full; (ii) a Final Recovery Determination is made
      as to
      such Mortgage Loan; or (iii) such Mortgage Loan is removed from the Trust Fund
      by reason of its being purchased, sold or replaced pursuant to or as
      contemplated by Section 2.03 or Section 10.01. With respect to any REO Property,
      either of the following events: (i) a Final Recovery Determination is made
      as to
      such REO Property; or (ii) such REO Property is removed from the Trust Fund
      by
      reason of its being sold or purchased pursuant to Section 3.23 or Section
      10.01.

     

    “Liquidation
      Proceeds”: The amount (other than amounts received in respect of the rental of
      any REO Property prior to REO Disposition) received by the Master Servicer
      in
      connection with (i) the taking of all or a part of a Mortgaged Property by
      exercise of the power of eminent domain or condemnation, (ii) the liquidation
      of
      a defaulted Mortgage Loan by means of a trustee’s sale, foreclosure sale or
      otherwise (including, with respect to a defaulted Mortgage Loan that is a
      Pledged Asset Loan, the amount realized on the related Pledged Assets with
      respect to such Mortgage Loan in accordance with Section 3.16), or (iii) the
      repurchase, substitution or sale of a Mortgage Loan or an REO Property pursuant
      to or as contemplated by Section 2.03, Section 3.16 or Section
      10.01.

     

    “Loan
      Balance”: As of any date, the aggregate Stated Principal Balance of all of the
      Mortgage Loans as of such date.

     

    “Loan-to-Value
      Ratio”: As of any date and Mortgage Loan (other than a Pledged Asset Loan), the
      fraction, expressed as a percentage, the numerator of which is the Stated
      Principal Balance of the Mortgage Loan, and the denominator of which is the
      Value of the related Mortgaged Property. As of any date and any Pledged Asset
      Loan, the related Effective Loan-to-Value Ratio.

     

    “Loan
      Rate”: With respect to each Mortgage Loan, the annual rate at which interest
      accrues on such Mortgage Loan from time to time in accordance with the
      provisions of the related Mortgage Note, which rate shall remain constant at
      the
      rate set forth in the Mortgage Loan Schedule as the Loan Rate in effect
      immediately following the Cut-off Date. With respect to each Mortgage Loan
      that
      becomes an REO Property, as of any date of determination, the annual rate
      determined in accordance with the immediately preceding sentence as of the
      date
      such Mortgage Loan became an REO Property.

     

    “Lockout
      Percentage”: With respect to any Distribution Date, the Certificate Principal
      Balance of the Class A-8 Certificates, divided by the aggregate Certificate
      Principal Balance of the Senior Certificates, in each case immediately prior
      to
      any allocations of losses or distributions on that Distribution
      Date.

     

    “Lockout
      Prepayment Percentage”: With respect to any Distribution Date, the product of
      (i) the Lockout Percentage and (ii) the Stepdown Percentage.

     

    “Lockout
      Scheduled Percentage”: With respect to any Distribution Date (i) occurring prior
      to October 2011, 0% and (ii) occurring in or after October 2011, the Lockout
      Percentage.

     

    “Lost
      Note Affidavit”: With respect to any Mortgage Loan as to which the original
      Mortgage Note has been permanently lost or destroyed and has not been replaced,
      an affidavit from the Depositor as applicable certifying that the original
      Mortgage Note has been lost, misplaced or destroyed (together with a copy of
      the
      related Mortgage Note and indemnifying the Trust against any loss, cost or
      liability resulting from the failure to deliver the original Mortgage Note)
      in
      the form of Exhibit H hereto.

     

    “Lower
      Priority”: As of any date of determination and with respect to any Class of
      Subordinate Certificates, any other Class of Subordinate Certificates then
      outstanding with a later priority for payments pursuant to Section
      4.01(c).

     

    “Lowest
      Priority”: As of any date of determination, the Class of Subordinate
      Certificates then outstanding with the latest priority for payments pursuant
      to
      Section 4.01(c), in the following order: Class B-6, Class B-5, Class B-4, Class
      B-3, Class B-2 and Class B-1 Certificates.

     

    “Majority
      Certificateholders”: The Holders of Certificates evidencing at least 51% of the
      Voting Rights.

     

    “Master
      Servicer Affiliate”: A Person (i) controlling, controlled by or under common
      control with the Master Servicer or which is 50% or more owned by the Master
      Servicer and (ii) which is qualified to service residential mortgage
      loans.

     

    “Master
      Servicer Event of Termination”: One or more of the events described in Section
      7.01.

     

    “Master
      Servicer Remittance Date”: With respect to any Distribution Date, the Business
      Day prior to such Distribution Date.

     

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

     

    “MERS®
      System”: The system of recording transfers of Mortgages electronically
      maintained by MERS.

     

    “MIN”:
      The Mortgage Identification Number for Mortgage Loans registered with MERS
      on
      the MERS® System.

     

    “MLCC”:
      Merrill Lynch Credit Corporation and its successors in interest.

     

    “MOM
      Loan”: With respect to any Mortgage Loan, MERS acting as the mortgagee of such
      Mortgage Loan, solely as nominee for the originator of such Mortgage Loan and
      its successors and assigns, at the origination thereof.

     

    “Monthly
      Interest Distributable Amount”: An amount equal to the interest accrued during
      the related Interest Accrual Period on the Certificate Principal Balance or
      Notional Amount, as applicable, of each Class of Certificates at the
      then-applicable Pass-Through Rate. The Monthly Interest Distributable Amount
      on
      any Class of Certificates will be reduced by the amount of (i) Prepayment
      Interest Shortfalls (to the extent not offset by the Master Servicer with a
      payment of Compensating Interest as provided in Section 3.24), (ii) the interest
      portion (adjusted to the Net Mortgage Rate) of Realized Losses (including Excess
      Losses and Extraordinary Losses) not allocated solely to one or more specific
      Classes of Certificates pursuant to Section 4.02, (iii) the interest portion
      of
      Advances previously made with respect to a Mortgage Loan or REO Property which
      remained unreimbursed following the Cash Liquidation or REO Disposition of
      such
      Mortgage Loan or REO Property that were made with respect to delinquencies
      that
      were ultimately determined to be Excess Losses or Extraordinary Losses and
      (iv)
      any other interest shortfalls not covered by the subordination provided by
      the
      Class B Certificates, including Relief Act Shortfalls, with all such reductions
      allocated among all of the Certificates in proportion to their respective
      amounts of Monthly Interest Distributable Amount payable on such Distribution
      Date which would have resulted absent such reductions.

     

    “Monthly
      Payment”: With respect to any Mortgage Loan, the scheduled monthly payment of
      principal and interest on such Mortgage Loan which is payable by the related
      Mortgagor from time to time under the related Mortgage Note, determined: (a)
      after giving effect to (i) any Deficient Valuation and/or Debt Service Reduction
      with respect to such Mortgage Loan and (ii) any reduction in the amount of
      interest collectible from the related Mortgagor pursuant to the Relief Act;
      (b)
      without giving effect to any extension granted or agreed to by the Master
      Servicer pursuant to Section 3.01; and (c) on the assumption that all other
      amounts, if any, due under such Mortgage Loan are paid when due.

     

    “Moody’s”:
      Moody’s Investors Service, Inc., and its successors.

     

    “Mortgage”:
      The mortgage, deed of trust or other instrument creating a first lien on, or
      first priority security interest in, a Mortgaged Property securing a Mortgage
      Note.

     

    “Mortgage
      100K
      Loan”: A
      Mortgage Loan secured by Pledged Assets in the form of a security interest
      in
      the Securities Account and the financial assets held therein and having a value,
      as of the date of origination of such Mortgage Loan, of at least equal to the
      related Original Pledged Asset Requirement.

     

    “Mortgage
      100K
      Pledge
      Agreement”: With respect to each Mortgage 100K
      Loan,
      the Pledge Agreement for Securities Account between the related mortgagor and
      the Pledged Asset Servicer pursuant to which such mortgagor granted a security
      interest in the related securities and other financial assets held
      therein.

     

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

     

    “Mortgage
      Loan”: Each mortgage loan (including the Cooperative Loans) transferred and
      assigned to the Trustee pursuant to Section 2.01 or Section 2.03(d) as from
      time
      to time held as a part of the Trust Fund, the Mortgage Loans so held being
      identified in the Mortgage Loan Schedule.

     

    “Mortgage
      Loan Purchase Agreement”: The mortgage loan purchase agreement, dated as of
      September 1, 2006, among the Sellers and the Depositor, regarding the transfer
      of the Mortgage Loans.

     

    “Mortgage
      Loan Schedule”: As of any date, the list of Mortgage Loans identifying the
      Mortgage Loans transferred from the Sellers, and attached hereto as Exhibit
      D.
      The Mortgage Loan Schedule shall set forth the following information with
      respect to each Mortgage Loan:

     

    
      	 	
              (i)

            	
              the
                Sellers’ Mortgage Loan identifying number;

            
	 	 	 
	 	
              (ii)

            	
              [reserved];

            
	 	 	 
	 	
              (iii)

            	
              the
                zip code of the related Mortgaged Property;

            
	 	 	 
	 	
              (iv)

            	
              a
                code indicating whether the Mortgaged Property is
                owner-occupied;

            
	 	 	 
	 	
              (v)

            	
              the
                type of Residential Dwelling constituting the Mortgaged
                Property;

            
	 	 	 
	 	
              (vi)

            	
              the
                original months to maturity;

            
	 	 	 
	 	
              (vii)

            	
              the
                original date of the mortgage;

            
	 	 	 
	 	
              (viii)

            	
              the
                Loan-to-Value Ratio or Effective Loan-to-Value Ratio, as applicable,
                at
                origination;

            
	 	 	 
	 	
              (ix)

            	
              the
                loan rate;

            
	 	 	 
	 	
              (x)

            	
              the
                date on which the first Monthly Payment was due on the Mortgage
                Loan;

            
	 	 	 
	 	
              (xi)

            	
              the
                stated maturity date;

            
	 	 	 
	 	
              (xii)

            	
              the
                amount of the Monthly Payment at origination;

            
	 	 	 
	 	
              (xiii)

            	
              the
                amount of the Monthly Payment as of the Cut-off Date;

            
	 	 	 
	 	
              (xiv)

            	
              the
                next Due Date on which a Monthly Payment is due;

            
	 	 	 
	 	
              (xv)

            	
              the
                original principal amount of the Mortgage Loan;

            
	 	 	 
	 	
              (xvi)

            	
              the
                unpaid principal balance of the Mortgage Loan as of the close of
                business
                on the Cut-off Date;

            
	 	 	 
	 	
              (xvii)

            	
              a
                code indicating the purpose of the Mortgage Loan (i.e., purchase
                financing, Rate/Term Refinancing, Cash-Out
                Refinancing);

            
	 	 	 
	 	
              (xviii)

            	
              a
                code indicating the documentation style (i.e., full, alternative
                or
                reduced);

            
	 	 	 
	 	
              (xix)

            	
              a
                code indicating if the Mortgage Loan is subject to a Primary Insurance
                Policy;

            
	 	 	 
	 	
              (xx)

            	
              the
                name of the Qualified Insurer and the certificate number for any
                Primary
                Insurance Policy, if applicable;

            
	 	 	 
	 	
              (xxi)

            	
              the
                depth of coverage of any Primary Insurance Policy, if
                applicable;

            
	 	 	 
	 	
              (xxii)

            	
              the
                Value of the Mortgaged Property;

            
	 	 	 
	 	
              (xxiii)

            	
              the
                sale price of the Mortgaged Property, if applicable;

            
	 	 	 
	 	
              (xxiv)

            	
              the
                Servicing Fee;

            
	 	 	 
	 	
              (xxv)

            	
              whether
                the Mortgage Loan is a Buydown Mortgage Loan; and

            
	 	 	 
	 	
              (xxvi)

            	
              the
                amount of the Original Pledged Asset Requirement, if
                any.

            

    

    

     

    The
      Mortgage Loan Schedule shall set forth the following information with respect
      to
      the Mortgage Loans in the aggregate as of the Cut-off Date: (1) the number
      of
      Mortgage Loans; (2) the current principal balance of the Mortgage Loans; (3)
      the
      weighted average Loan Rate of the Mortgage Loans; and (4) the weighted average
      maturity of the Mortgage Loans. The Mortgage Loan Schedule shall be amended
      from
      time to time by the Master Servicer in accordance with the provisions of this
      Agreement. With respect to any Eligible Substitute Mortgage Loan, Cut-off Date
      shall refer to the related Cut-off Date for such Mortgage Loan, determined
      in
      accordance with the definition of Cut-off Date herein.

     

    “Mortgage
      Note”: The original executed note or other evidence of indebtedness evidencing
      the indebtedness of a Mortgagor under a Mortgage Loan.

     

    “Mortgage
      Pool”: The pool of Mortgage Loans, identified on Exhibit D from time to time,
      and any REO Properties acquired in respect thereof.

     

    “Mortgaged
      Property”: The underlying property securing a Mortgage Loan, including any REO
      Property, consisting of an Estate in Real Property improved by a Residential
      Dwelling.

     

    “Mortgagor”:
      The obligor on a Mortgage Note.

     

    “Net
      Liquidation Proceeds”: With respect to any Liquidated Mortgage Loan or any other
      disposition of related Mortgaged Property (including REO Property) the related
      Liquidation Proceeds net of Advances, Servicing Advances, Servicing Fees and
      any
      other accrued and unpaid Servicing Fees received and retained in connection
      with
      the liquidation of such Mortgage Loan or Mortgaged Property Rate.

     

    “Net
      Mortgage Rate”: With respect to any Mortgage Loan, (x) the Loan Rate minus (y)
      the Servicing Fee Rate and the Trustee Fee Rate.

     

    “New
      Lease”: Any lease of REO Property entered into on behalf of the Trust, including
      any lease renewed or extended on behalf of the Trust if the Trust has the right
      to renegotiate the terms of such lease.

     

    “Nonrecoverable
      Advance”: Any Advance or Servicing Advance previously made or proposed to be
      made in respect of a Mortgage Loan or REO Property that, in the good faith
      business judgment of the Master Servicer, will not or, in the case of a proposed
      Advance or Servicing Advance, would not be ultimately recoverable from Late
      Collections on such Mortgage Loan or REO Property as provided
      herein.

     

    “Notional
      Amount”: With respect to the Class A-3 Certificates and any Distribution Date,
      the Certificate Principal Balance of the Class A-2 Certificates immediately
      prior to that distribution date. For federal income tax purposes, the Notional
      Amount of the Class A-3 Certificates shall be equal to the Uncertificated
      Principal Balance of REMIC I Regular Interest A-2.

     

    “Officers’
      Certificate”: A certificate signed by the Chairman of the Board, the Vice
      Chairman of the Board, the President or a vice president (however denominated),
      and by the Treasurer, the Secretary, or one of the assistant treasurers or
      assistant secretaries of the Master Servicer or the Depositor, as
      applicable.

     

    “Opinion
      of Counsel”: A written opinion of counsel, who may, without limitation, be a
      salaried counsel for the Depositor or the Master Servicer, acceptable to the
      Trustee, except that any opinion of counsel relating to (a) the qualification
      of
      any REMIC as a REMIC or (b) compliance with the REMIC Provisions must be an
      opinion of Independent counsel.

     

    “Optional
      Termination Date”: The first Distribution Date on which the Master Servicer may
      opt to terminate the Trust Fund pursuant to Section 10.01.

     

    “Original
      Certificate Principal Balance”: With respect to each Class of the Certificates
      other than the Class A-3 Certificates, the Certificate Principal Balance thereof
      on the Closing Date, as set forth opposite such Class above in the Preliminary
      Statement.

     

    “Original
      Notional Amount”: With respect to the Class A-3 Certificates,
      $25,297,813.00.

     

    “Original
      Pledged Asset Requirement’: With respect to any Pledged Asset Loan, an amount
      equal to the Pledged Assets required at the time of the origination of such
      Pledged Asset Loan in order to achieve an Effective Loan-to-Value Ratio for
      such
      Pledged Asset Loan, generally equal to seventy percent (70%); for purposes
      of
      the Required Surety Payment, in no event shall the Original Pledged Asset
      Requirement for a Pledged Asset Loan exceed thirty percent (30%) of its original
      principal balance.

     

    “Original
      Subordinated Principal Balance”: The aggregate of the Certificate Principal
      Balances of the Subordinate Certificates as of the Cut-off Date.

     

    “Other
      Insurance Proceeds”: Proceeds of any title policy, hazard policy or other
      insurance policy covering a Mortgage Loan, other than the Primary Insurance
      Policy, if any, to the extent such proceeds are not to be applied to the
      restoration of the related Mortgaged Property or released to the Mortgagor
      in
      accordance with the procedures that the Master Servicer would follow in
      servicing mortgage loans held for its own account.

     

    “Ownership
      Interest”: As to any Certificate, any ownership or security interest in such
      Certificate, including any interest in such Certificate as the Holder thereof
      and any other interest therein, whether direct or indirect, legal or beneficial,
      as owner or as pledgee.

     

    “Parent
      Power® Agreement”: With respect to each Parent Power® Mortgage Loan, a Parent
      Power® Guaranty and Security Agreement for Securities Account.

     

    “Parent
      Power® Guaranty and Security Agreement for Securities Account”: With respect to
      a Parent Power® Mortgage Loan, an agreement between the Pledged Asset Servicer
      and a guarantor on behalf of the mortgagor under such Parent Power® Mortgage
      Loan pursuant to which such guarantor guarantees the payment of certain losses
      under such Parent Power® Mortgage Loan and has granted a security interest to
      the Pledged Asset Servicer in certain marketable securities to collateralize
      such guaranty. The required amount of such collateral is at least equal to
      the
      Original Pledged Asset Requirement for such Parent Power® Mortgage
      Loan.

     

    “Parent
      Power® Mortgage Loan”: A Mortgage Loan having at the time of origination a
      Loan-to-Value Ratio generally in excess of the Master Servicer’s maximum
      acceptable Loan-to-Value Ratio for such Mortgage Loan as set forth in the
      Underwriting Guide, which Mortgage Loan is supported by a Parent Power®
Agreement.

     

    “Pass-Through
      Rate”: With respect to the Certificates (other than the Class A-2, Class A-3,
      Class A-4 and Class A-5 Certificates) and any Distribution Date, a per annum
      rate equal to the weighted average of the Net Mortgage Rate on each Mortgage
      Loan. For federal income tax purposes, the equivalent of the foregoing shall
      be
      expressed as the weighted average of the Uncertificated Pass-Through Rate on
      each REMIC I Regular Interest, weighted on the basis of the Uncertificated
      Principal Balance of each such REMIC I Regular Interest. With respect to the
      Class A-2 Certificates and any Distribution Date, a per annum rate equal to
      (i)
      the weighted average of the Net Mortgage Rate on each Mortgage Loan minus (ii)
      0.39%. For federal income tax purposes, however, the Class A-2 Certificates
      will
      have a per annum rate equal to (i) the Uncertificated Pass-Through Rate on
      the
      REMIC I Regular Interest A-2 minus (ii) 0.39%. With respect to any Distribution
      Date and the Class A-3 Certificates, a per annum rate equal to 0.39%. With
      respect to the Class A-4 Certificates and any Distribution Date, a per annum
      rate equal to (i) the weighted average of the Net Mortgage Rate on each Mortgage
      Loan minus (ii) 0.58%. For federal income tax purposes, however, the Class
      A-4
      Certificates will have a per annum rate equal to (i) the Uncertificated
      Pass-Through Rate on the REMIC I Regular Interest A-4 minus (ii) 0.58%. With
      respect to the Class A-5 Certificates and any Distribution Date, a per annum
      rate equal to (i) the weighted average of the Net Mortgage Rate on each Mortgage
      Loan plus (ii) 1.45%. For federal income tax purposes, however, the Class A-5
      Certificates will have a per annum rate equal to (i) the Uncertificated
      Pass-Through Rate on the REMIC I Regular Interest A-5 plus (ii) 1.45%.

    

    “Paying
      Agent”: Any paying agent appointed pursuant to Section 5.05.

     

    “Percentage
      Interest”: With respect to any Certificate (other than a Class R Certificate), a
      fraction, expressed as a percentage, the numerator of which is the Initial
      Certificate Principal Balance or Initial Notional Amount, represented by such
      Certificate and the denominator of which is the Original Certificate Principal
      Balance or original Notional Amount, as the case may be, of the related Class.
      With respect to any Class of Class R Certificates, the portion of such Class
      evidenced thereby, expressed as a percentage, as stated on the face of such
      Certificate; provided, however, that the sum of all such percentages for each
      such Class totals 100%.

     

    “Permitted
      Investments”: Any one or more of the following obligations or securities
      acquired at a purchase price of not greater than par, regardless of whether
      issued or managed by the Depositor, the Master Servicer, the Trustee or any
      of
      their respective Affiliates or for which an Affiliate of the Trustee serves
      as
      an advisor:

     

    (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 the Rating Agency in its highest short-term rating
      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 S&P, 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 the Rating Agency in its highest
      short-term rating available; and provided further that, if the only Rating
      Agency is S&P 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 institution
      or trust company shall exceed 30 days, the short-term rating of such institution
      shall be A-1+ in the case of S&P if S&P is the Rating
      Agency;

     

    (iv) commercial
      paper and demand notes (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 the Rating Agency
      in
      its highest short-term rating 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 the Rating Agency in its
      highest long-term rating available; and

     

    (vi) other
      obligations or securities that are acceptable to the Rating Agency as a
      Permitted Investment hereunder and will not reduce the rating assigned to any
      Class of Certificates by such Rating Agency below the lower of the then-current
      rating or the rating assigned to such Certificates as of the Closing Date by
      such Rating Agency, as evidenced in writing;

     

    provided,
      that no instrument described hereunder shall evidence either the right to
      receive (a) only interest with respect to the obligations underlying such
      instrument or (b) both principal and interest payments derived from obligations
      underlying such instrument and the interest and principal payments with respect
      to such instrument provide a yield to maturity at par greater than 120% of
      the
      yield to maturity at par of the underlying obligations.

     

    “Permitted
      Transferee”: Any Person other than a Disqualified Organization, an “electing
      large partnership” as defined in Section 775(a) of the Code, or a non-U.S.
      Person.

     

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

     

    “Pledged
      Assets”: (i) With respect to any Mortgage 100K
      Loan,
      the Securities Account and the financial assets held therein subject to a
      security interest pursuant to the related Mortgage 100K
      Pledge
      Agreement, or (ii) with respect to any Parent Power® Mortgage Loan, the related
      Parent Power® Agreement and collateral pledged pursuant thereto.

     

    “Pledged
      Asset Agreements”: Each Mortgage 100K
      Pledge
      Agreement, Parent Power® Guaranty and Security Agreement for Securities Account
      and Control Agreement, as applicable, for each Pledged Asset Loan.

     

    “Pledged
      Asset Loan”: A Mortgage Loan that is supported by Pledged Assets.

     

    “Pledged
      Asset Servicer”: MLCC.

     

    “Pledged
      Asset Servicing Agreement”: The Additional Collateral Transfer and Servicing
      Agreement, dated as of November 1, 2001, between MLCC and the Master
      Servicer.

     

    “Prepayment
      Distribution Trigger”: With respect to any Distribution Date and any Class of
      Subordinate Certificates (other than the Class B-1 Certificates), a test that
      shall be satisfied if the fraction (expressed as a percentage) equal to the
      sum
      of the Certificate Principal Balances of such Class and each Class of
      Subordinate Certificates with a Lower Priority than such Class immediately
      prior
      to such Distribution Date divided by the aggregate Stated Principal Balance
      of
      all of the Mortgage Loans (or related REO Properties) immediately prior to
      such
      Distribution Date is greater than or equal to the sum of the related initial
      Class B Percentages of such Classes of Subordinate Certificates.

     

    “Prepayment
      Interest Shortfall”: As to any Distribution Date and any Mortgage Loan (other
      than a Mortgage Loan relating to an REO Property) that was the subject of (a)
      a
      Principal Prepayment in Full during the related Prepayment Period, an amount
      equal to the excess of one month’s interest at the Net Mortgage Rate on the
      Stated Principal Balance of such Mortgage Loan over the amount of interest
      (adjusted to the Net Mortgage Rate) paid by the Mortgagor for such Prepayment
      Period to the date of such Principal Prepayment in Full or (b) a Curtailment
      during the prior calendar month, an amount equal to one month’s interest at the
      Net Mortgage Rate on the amount of such Curtailment. The obligations of the
      Master Servicer in respect of any Prepayment Interest Shortfall are set forth
      in
      Section 3.24.

     

    “Prepayment
      Period”: With respect to any Distribution Date, the calendar month preceding the
      month in which such Distribution Date occurs.

     

    “Primary
      Insurance Policy”: Each policy of primary guaranty mortgage insurance issued by
      a Qualified Insurer in effect with respect to any Mortgage Loan, or any
      replacement policy therefor obtained by the Master Servicer pursuant to Section
      3.13.

     

    “Principal
      Prepayment”: Any payment of principal made by the Mortgagor on a Mortgage Loan
      which is received in advance of its scheduled Due Date and which is not
      accompanied by an amount of interest representing the full amount of scheduled
      interest due on any Due Date in any month or months subsequent to the month
      of
      prepayment.

     

    “Principal
      Prepayment in Full”: Any Principal Prepayment made by a Mortgagor of the entire
      unpaid principal balance of the Mortgage Loan.

     

    “Private
      Certificates”: Any of the Class A-6, Class A-7, Class A-8, Class B-1, Class B-2,
      Class B-3, Class B-4, Class B-5 and Class B-6 Certificates.

     

    “Property
      Insurance Proceeds”: Proceeds of any title policy, hazard policy or other
      insurance policy covering a Mortgage Loan, to the extent such proceeds are
      received by the Master Servicer and are not to be applied to the restoration
      of
      the related Mortgaged Property or released to the Mortgagor in accordance with
      the Master Servicer’s servicing procedures, subject to the terms and conditions
      of the related Mortgage Note and Mortgage.

     

    “Purchase
      Price”: With respect to any Mortgage Loan or REO Property to be purchased
      pursuant to or as contemplated by Section 2.03 or 10.01, and as confirmed by
      an
      Officers’ Certificate from the Master Servicer to the Trustee, an amount equal
      to the sum of (i) 100% of the Stated Principal Balance thereof as of the date
      of
      purchase (or such other price as provided in Section 10.01), (ii) in the case
      of
      (x) a Mortgage Loan, accrued interest on such Stated Principal Balance at the
      applicable Loan Rate in effect from time to time from the Due Date as to which
      interest was last covered by a payment by the Mortgagor or an advance by the
      Master Servicer, which payment or advance had as of the date of purchase been
      distributed pursuant to Section 4.01, through the end of the calendar month
      in
      which the purchase is to be effected, and (y) an REO Property, the sum of (1)
      accrued interest on such Stated Principal Balance at the applicable Loan Rate
      in
      effect from time to time from the Due Date as to which interest was last covered
      by a payment by the Mortgagor or an advance by the Master Servicer through
      the
      end of the calendar month immediately preceding the calendar month in which
      such
      REO Property was acquired, plus (2) REO Imputed Interest for such REO Property
      for each calendar month commencing with the calendar month in which such REO
      Property was acquired and ending with the calendar month in which such purchase
      is to be effected, net of the total of all net rental income, Insurance
      Proceeds, Liquidation Proceeds and Advances that as of the date of purchase
      had
      been distributed as or to cover REO Imputed Interest pursuant to Section 4.07,
      (iii) any unreimbursed Servicing Advances and Advances and any unpaid Servicing
      Fees allocable to such Mortgage Loan or REO Property, (iv) any amounts
      previously withdrawn from the Collection Account in respect of such Mortgage
      Loan or REO Property pursuant to Section 3.23, and (v) in the case of a Mortgage
      Loan required to be purchased pursuant to Section 2.03, expenses reasonably
      incurred or to be incurred by the Master Servicer or the Trustee in respect
      of
      the breach or defect giving rise to the purchase obligation.

     

    “Qualified
      Insurer”: Any insurance company acceptable to Fannie Mae or Freddie
      Mac.

     

    “Rate/Term
      Refinancing”: A Refinanced Mortgage Loan which is not a Cash-Out
      Refinancing.

     

    “Rating
      Agency”: Fitch or its successors. If such agency or its successors are no longer
      in existence, “Rating Agency” shall be such nationally recognized statistical
      rating agency, or other comparable Person, designated by the Depositor, notice
      of which designation shall be given to the Trustee and Master
      Servicer.

     

    “Realized
      Loss”: With respect to a Liquidated Mortgage Loan, the amount by which the
      remaining unpaid principal balance of the Mortgage Loan exceeds the amount
      of
      Liquidation Proceeds applied to the principal balance of the related Mortgage
      Loan. To the extent the Master Servicer receives Subsequent Recoveries with
      respect to any Mortgage Loan, the amount of the Realized Loss with respect
      to
      that Mortgage Loan will be reduced to the extent such recoveries are applied
      to
      reduce the Certificate Principal Balance of any Class of Certificates on any
      Distribution Date.

     

    “Record
      Date”: With respect to all of the Certificates, the last Business Day of the
      month immediately preceding the month in which the related Distribution Date
      occurs.

     

    “Refinanced
      Mortgage Loan”: A Mortgage Loan the proceeds of which were used to satisfy an
      existing mortgage loan on the Mortgaged Property.

     

    “Regular
      Certificate”: Any of the Class A Certificates and Class B
      Certificates.

     

    “Related
      Documents”: With respect to any Mortgage Loan, the related Mortgage Notes,
      Mortgages and other related documents.

     

    “Relief
      Act”: The Servicemembers Civil Relief Act.

     

    “Relief
      Act Interest Shortfall”: With respect to any Distribution Date, for any Mortgage
      Loan as to which there has been a reduction in the amount of interest
      collectible thereon for the most recently ended Due Period as a result of the
      application of the Relief Act, the amount by which (i) interest collectible
      on
      such Mortgage Loan during such Due Period is less than (ii) one month’s interest
      on the Stated Principal Balance of such Mortgage Loan at the Loan Rate for
      such
      Mortgage Loan before giving effect to the application of the Relief
      Act.

     

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

     

    “REMIC
      I”: The segregated pool of assets, with respect to which a REMIC election is
      to
      be made, consisting of: (i) each Mortgage Loan (exclusive of payments of
      principal and interest due on or before the Cut-off Date, if any, received
      by
      the Master Servicer which shall not constitute an asset of the Trust Fund)
      as
      from time to time are subject to this Agreement and all payments under and
      proceeds of such Mortgage Loans (exclusive of any prepayment fees and late
      payment charges received on the Mortgage Loans), together with all documents
      included in the related Mortgage File, subject to Section 2.01; (ii) such funds
      or assets as from time to time are deposited in the Collection Account or the
      Distribution Account and belonging to the Trust Fund; (iii) any REO Property;
      (iv) the Primary Hazard Insurance Policies, if any, the Primary Insurance
      Policies, if any, and all other Insurance Policies with respect to the Mortgage
      Loans; (v) the Depositor’s rights in respect of the Pledged Assets and the
      Limited Purpose Surety Bond, including the assignment of the Depositor’s rights
      under the Pledged Asset Servicing Agreement; and (vi) the Depositor’s interest
      in respect of the representations and warranties made by the Sellers in the
      Mortgage Loan Purchase Agreement as assigned to the Trustee pursuant to Section
      2.04 hereof. The Trust Fund shall not include the Buydown Account.

     

    “REMIC
      I
      Regular Interests”: The uncertificated partial undivided beneficial ownership
      interests in REMIC I, designated as REMIC I Regular Interests A-1, A-2, A-4,
      A-5, A-6, A-7, A-8, B-1, B-2, B-3, B-4, B-5, B-6 and R-II, with respect to
      which
      a REMIC election is to be made.

     

    “REMIC
      II”: The segregated pool of assets consisting of the REMIC I Regular Interests
      conveyed in trust to the Trustee for the benefit of the holders of the Class
      A-1, Class A-2, Class A-3, Class A-4, Class A-5, Class A-6, Class A-7, Class
      A-8, Class B-1, Class B-2, Class B-3, Class B-4, Class B-5, Class B-6 and Class
      R-II Certificates pursuant to Section 9.01, with respect to which a separate
      REMIC election is to be made pursuant to Section 9.01.

     

    “REMIC
      Provisions”: Provisions of the federal income tax law relating to real estate
      mortgage investment conduits which appear at Section 860A through 860G of
      Subchapter M of Chapter 1 of the Code, and related provisions, and regulations
      and rulings promulgated thereunder, as the foregoing may be in effect from
      time
      to time.

     

    “Remittance
      Report”: A report prepared by the Master Servicer and delivered to the Trustee
      pursuant to Section 4.03.

     

    “Rents
      from Real Property”: With respect to any REO Property, gross income of the
      character described in Section 856(d) of the Code.

     

    “REO
      Account”: The account or accounts maintained by the Master Servicer in respect
      of an REO Property pursuant to Section 3.23.

     

    “REO
      Disposition”: The sale or other disposition of an REO Property on behalf of the
      Trust Fund.

     

    “REO
      Imputed Interest”: As to any REO Property, for any calendar month during which
      such REO Property was at any time part of the Trust Fund, one month’s interest
      at the applicable Net Mortgage Rate on the Stated Principal Balance of such
      REO
      Property (or, in the case of the first such calendar month, of the related
      Mortgage Loan if appropriate) as of the close of business on the Distribution
      Date in such calendar month.

     

    “REO
      Principal Amortization”: With respect to any REO Property, for any calendar
      month, the excess, if any, of (a) the aggregate of all amounts received in
      respect of such REO Property during such calendar month, whether in the form
      of
      rental income, sale proceeds (including, without limitation, that portion of
      the
      Termination Price paid in connection with a purchase of all of the Mortgage
      Loans and REO Properties pursuant to Section 10.01 that is allocable to such
      REO
      Property) or otherwise, net of any portion of such amounts (i) payable pursuant
      to Section 3.23 in respect of the proper operation, management and maintenance
      of such REO Property or (ii) payable or reimbursable to the Master Servicer
      pursuant to Section 3.23 for unpaid Servicing Fees in respect of the related
      Mortgage Loan and unreimbursed Servicing Advances and Advances in respect of
      such REO Property or the related Mortgage Loan, over (b) the REO Imputed
      Interest in respect of such REO Property for such calendar month.

     

    “REO
      Property”: A Mortgaged Property acquired by the Master Servicer on behalf of the
      Trust Fund through foreclosure or deed-in-lieu of foreclosure, as described
      in
      Section 3.23 hereto.

     

    “Request
      for Release”: A release signed by a Servicing Officer, in the form of Exhibit E
      attached

     

    “Required
      Surety Payment”: With respect to any Pledged Asset Loan that becomes a
      Liquidated Mortgage Loan, the lesser of (i) the principal portion of the
      Realized Loss with respect to such Mortgage Loan and (ii) the excess, if any,
      of
      (a) the Original Pledged Asset Requirement with respect to such Mortgage Loan
      over (b) the net proceeds realized by the Pledged Asset Servicer from the
      related Pledged Assets as set forth in Section 3.16.

     

    “Residential
      Dwelling”: Any one of the following: (i) an attached or detached one-family
      dwelling unit, (ii) two- to four-family dwelling unit, (iii) condominium, (iv)
      townhouse, (v) row house, or (vi) individual unit in a planned unit
      development.

     

    “Residual
      Certificate”: Any of the Class R Certificates.

     

    “Residual
      Interest”: The sole class of “residual interests” in a REMIC within the meaning
      of Section 860G(a)(2) of the Code.

     

    “Responsible
      Officer”: When used with respect to the Trustee, any officer, including any Vice
      President, Assistant Vice President, Trust Officer, any Assistant Secretary,
      any
      trust officer or any other officer of the Trustee customarily performing
      functions similar to those performed by any of the above designated officers
      and
      in each case having direct responsibility for the administration of this
      Agreement.

     

    “Restricted
      Classes”: With respect to any Class of Certificates, any Classes of Certificates
      with a lower priority of payment relative to such Class.

     

    “S&P”:
      Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and its
      successors.

     

    “Securities
      Account”: With respect to any Pledged Asset Loans, the account, together with
      the financial assets held therein, that is the subject of the related Mortgage
      100K
      Pledge
      Agreement.

     

    “Security
      Agreement”: With respect to a Cooperative Loan, the agreement creating a
      security interest in favor of the originator in the related Cooperative
      Assets.

     

    “Seller”:
      Either of (i) PHH Mortgage Corporation, a New Jersey corporation, or any
      successor in interest or (ii) Bishop’s Gate Residential Mortgage Trust, a
      Delaware business trust, or any successor in interest.

     

    “Senior
      Certificates”: The Class A-1, Class A-2, Class A-3, Class A-4, Class A-5, Class
      A-6, Class A-7, Class A-8 and Class R Certificates.

     

    “Senior
      Interest Distribution Amount”: With respect to each Distribution Date, the
      aggregate amount of the Monthly Interest Distributable Amount to be distributed
      to the Holders of the Senior Certificates for such Distribution
      Date.

     

    “Senior
      Percentage”: As of any Distribution Date, the lesser of 100% and a fraction,
      expressed as a percentage, the numerator of which is the aggregate Certificate
      Principal Balance of the Class A Certificates and Class R Certificates
      immediately prior to such Distribution Date and the denominator of which is
      the
      aggregate Stated Principal Balance of all of the Mortgage Loans or related
      REO
      Properties immediately prior to such Distribution Date.

     

    “Senior
      Prepayment Percentage”: With respect to any Distribution Date, the percentage
      indicated below:

     

    
      	
              Distribution
                Date

            	
              Senior
                Prepayment Percentage

            
	
              October
                2006
                through September
                2011

            	
              100%

            
	
              October
                2011 through
                September
                2012

            	
              Senior
                Percentage, plus 70% of the Subordinate Percentage

            
	
              October
                2012 through
                September
                2013

            	
              Senior
                Percentage, plus 60% of the Subordinate Percentage

            
	
              October
                2013
                through September
                2014

            	
              Senior
                Percentage, plus 40% of the Subordinate Percentage

            
	
              October
                2014
                through September
                2015

            	
              Senior
                Percentage, plus 20% of the Subordinate Percentage

            
	
              October
                2015
                and thereafter

            	
              Senior
                Percentage

            

    

    

    provided,
      however, (i) that any scheduled reduction to the Senior Prepayment Percentage
      described above shall not occur as of any Distribution Date unless either
      (a)(1)(x) the outstanding principal balance of Mortgage Loans Delinquent 60
      days
      or more (including Mortgage Loans in foreclosure and REO Property) averaged
      over
      the last six months as a percentage of the aggregate outstanding Certificate
      Principal Balance of the Class B Certificates as of such Distribution Date,
      is
      less than 50%, or (y) the outstanding principal balance of Mortgage Loans
      Delinquent 60 days or more (including Mortgage Loans in foreclosure and REO
      Property) averaged over the last six months, as a percentage of the aggregate
      outstanding principal balance of all Mortgage Loans as of such Distribution
      Date, does not exceed 2% and (2) Realized Losses on the Mortgage Loans to date
      for such Distribution Date if occurring during the sixth, seventh, eighth,
      ninth
      or tenth year (or any year thereafter) after the Closing Date are less than
      30%,
      35%, 40%, 45% or 50%, respectively, of the sum of the Initial Certificate
      Principal Balances of the Class B Certificates or (b) (1) the aggregate
      outstanding principal balance of the Mortgage Loans Delinquent 60 days or more
      (including Mortgage Loans in foreclosure and REO Property) averaged over the
      last six months, as a percentage of the aggregate outstanding principal balance
      of all Mortgage Loans as of such Distribution Date, does not exceed 4% and
      (2)
      Realized Losses on the Mortgage Loans to date for such Distribution Date if
      occurring during the sixth, seventh, eighth, ninth or tenth year (or any year
      thereafter) after the Closing Date are less than 10%, 15%, 20%, 25% or 30%,
      respectively, of the sum of the Initial Certificate Principal Balances of the
      Class B Certificates and (ii) that for any Distribution Date on which the Senior
      Percentage is greater than the Original Senior Percentage, the Senior Prepayment
      Percentage for such Distribution Date shall be 100%. Notwithstanding the
      foregoing, upon the reduction of the aggregate Certificate Principal Balance
      of
      the Senior Certificates to zero, the Senior Prepayment Percentage will equal
      0%.

     

    “Senior
      Principal Distribution Amount”: As to any Distribution Date, the lesser of (a)
      the balance of the Available Distribution Amount remaining after the
      distribution of all amounts required to be distributed pursuant to Section
      4.01(c)(i) and (b) the sum of the following:

     

    (A) the
      Senior Percentage for such Distribution Date times the sum of the
      following:

     

    (1) the
      principal portion of each Monthly Payment due during the related Due Period
      on
      each Outstanding Mortgage Loan whether or not received on or prior to the
      related Determination Date, minus the principal portion of any Debt Service
      Reduction, which together with other Bankruptcy Losses exceeds the Bankruptcy
      Amount;

     

    (2) the
      Stated Principal Balance of any Mortgage Loan repurchased during the related
      Prepayment Period pursuant to Section 2.02, 2.03, 3.15 or 3.16; and

     

    (3) the
      principal portion of all other unscheduled collections (other than Principal
      Prepayments in Full and Curtailments and amounts received in connection with
      a
      Cash Liquidation or REO Disposition of a Mortgage Loan, including without
      limitation Insurance Proceeds, Liquidation Proceeds, Subsequent Recoveries
      and
      REO Proceeds), received during the related Prepayment Period to the extent
      applied by the Master Servicer as recoveries of principal of the related
      Mortgage Loan pursuant to Section 3.16;

     

    (B) with
      respect to each Mortgage Loan for which a Cash Liquidation or a REO Disposition
      occurred during the related Prepayment Period and did not result in any Excess
      Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses or
      Extraordinary Losses, an amount equal to the lesser of (a) the Senior Percentage
      for such Distribution Date times the Stated Principal Balance of such Mortgage
      Loan and (b) the Senior Prepayment Percentage for such Distribution Date times
      the related unscheduled collections (including without limitation Insurance
      Proceeds, Liquidation Proceeds and REO Proceeds) to the extent applied by the
      Master Servicer as recoveries of principal of the related Mortgage Loan pursuant
      to Section 3.16;

     

    (C) the
      Senior Prepayment Percentage for such Distribution Date times the aggregate
      of
      all Principal Prepayments in Full and Curtailments received in the related
      Prepayment Period with respect to the Mortgage Loans;

     

    (D) any
      Excess Subordinate Principal Amount for such Distribution Date; and

     

    (E) any
      amounts described in clauses (A), (B) or (C) of this definition, as determined
      for any previous Distribution Date, which remain unpaid after application of
      amounts previously distributed pursuant to this clause (E) to the extent that
      such amounts are not attributable to Realized Losses which have been allocated
      to the Class B Certificates;

     

    “Servicing
      Account”: The account or accounts created and maintained pursuant to Section
      3.09.

     

    “Servicer
      Event of Termination”: One or more of the events described in Section
      7.01.

     

    “Servicing
      Advances”: The reasonable “out-of-pocket” costs and expenses incurred by the
      Master Servicer in connection with a default, delinquency or other unanticipated
      event by the Master Servicer in the performance of its servicing obligations,
      including, but not limited to, (a) reasonable attorneys’ fees and (b) the cost
      of (i) the preservation, restoration and protection of a Mortgaged Property,
      (ii) any enforcement or judicial proceedings, including foreclosures, in respect
      of a particular Mortgage Loan, including any expenses incurred in relation
      to
      any such proceedings that result from the Mortgage Loan being registered on
      the
      MERS System, (iii) the management (including reasonable fees in connection
      therewith) and liquidation of any REO Property, and (iv) the performance of
      its
      obligations under Section 3.01, Section 3.09, Section 3.13, Section 3.14,
      Section 3.16 and Section 3.23. The Master Servicer shall not be required to
      make
      any Servicing Advance in respect of a Mortgage Loan or REO Property that, in
      the
      good faith business judgment of the Master Servicer, would not be ultimately
      recoverable from related Insurance Proceeds or Liquidation Proceeds on such
      Mortgage Loan or REO Property as provided herein.

     

    “Servicing
      Officer”: Any officer of the Master Servicer involved in, or responsible for,
      the administration and servicing of Mortgage Loans, whose name and specimen
      signature appear on a list of servicing officers famished by the Master Servicer
      to the Trustee and the Depositor on the Closing Date, as such list may from
      time
      to time be amended.

     

    “Servicing
      Fee”: With respect to each Mortgage Loan and for any calendar month, an amount
      equal to one month’s interest (or in the event of any payment of interest which
      accompanies a Principal Prepayment in Full made by the Mortgagor during such
      calendar month, interest for the number of days covered by such payment of
      interest) at the applicable Servicing Fee Rate on the same principal amount
      on
      which interest on such Mortgage Loan accrues for such calendar
      month.

     

    “Servicing
      Fee Rate”: With respect to each Mortgage Loan, a rate equal to 0.25% per
      annum.

     

    “Special
      Hazard Amount”: As of any Distribution Date, an amount equal to $655,941
      minus
      the
      sum of (i) the aggregate amount of Special Hazard Losses allocated solely to
      one
      or more specific Classes of Certificates in accordance with Section 4.02 and
      (ii) the Adjustment Amount (as defined below) as most recently calculated.
      For
      each anniversary of the Cut-off Date, the Adjustment Amount shall be equal
      to
      the amount, if any, by which the amount calculated in accordance with the
      preceding sentence (without giving effect to the deduction of the Adjustment
      Amount for such anniversary) exceeds the greater of (A) the greatest of (i)
      twice the outstanding principal balance of the Mortgage Loan in the Trust Fund
      which has the largest outstanding principal balance on the Distribution Date
      immediately preceding such anniversary, (ii) the product of 1.00% multiplied
      by
      the outstanding principal balance of all Mortgage Loans on the Distribution
      Date
      immediately preceding such anniversary and (iii) the aggregate outstanding
      principal balance (as of the immediately preceding Distribution Date) of the
      Mortgage Loans in any single five-digit California zip code area with the
      largest amount of Mortgage Loans by aggregate principal balance as of such
      anniversary and (B) the greater of (i) the product of 0.50% multiplied by the
      outstanding principal balance of all Mortgage Loans on the Distribution Date
      immediately preceding such anniversary multiplied by a fraction, the numerator
      of which is equal to the aggregate outstanding principal balance (as of the
      immediately preceding Distribution Date) of all of the Mortgage Loans secured
      by
      Mortgaged Properties located in the State of California divided by the aggregate
      outstanding principal balance (as of the immediately preceding Distribution
      Date) of all of the Mortgage Loans, expressed as a percentage, and the
      denominator of which is equal to 16.05% (which percentage is equal to the
      percentage of Mortgage Loans initially secured by Mortgaged Properties located
      in the State of California) and (ii) the aggregate outstanding principal balance
      (as of the immediately preceding Distribution Date) of the largest Mortgage
      Loan
      secured by a Mortgaged Property located in the State of California.

     

    The
      Special Hazard Amount may be further reduced by the Master Servicer (including
      accelerating the manner in which coverage is reduced) provided that prior to
      any
      such reduction, the Master Servicer shall (i) obtain written confirmation from
      the Rating Agency that such reduction shall not reduce the rating assigned
      to
      any Class of Certificates by such Rating Agency below the lower of the
      then-current rating or the rating assigned to such Certificates as of the
      Closing Date by such Rating Agency and (ii) provide a copy of such written
      confirmation to the Trustee.

     

    “Special
      Hazard Losses”: Realized Losses in respect of Special Hazard Mortgage
      Loans.

     

    “Special
      Hazard Mortgage Loan”: A Liquidated Mortgage Loan as to which the ability to
      recover the full amount due thereunder was substantially unpaired by a hazard
      not insured against under a standard hazard insurance policy.

     

    “Startup
      Day”: As defined in Section 9.01(b) hereof.

     

    “Stated
      Principal Balance”: With respect to any Mortgage Loan and Due Date, the unpaid
      principal balance of such Mortgage Loan as of such Due Date, as specified in
      the
      amortization schedule at the time relating thereto (before any adjustment to
      such amortization schedule by reason of any moratorium or similar waiver or
      grace period), after giving effect to any previous partial prepayments and
      Liquidation Proceeds received and to the payment of principal due on such Due
      Date and irrespective of any delinquency in payment by the related
      Mortgagor.

     

    “Stayed
      Funds”: If the Master Servicer is the subject of a proceeding under the federal
      Bankruptcy Code and the mailing of a remittance by the Master Servicer pursuant
      to this Agreement is prohibited by Section 362 of the federal Bankruptcy Code,
      funds which are in the custody of the Master Servicer, a trustee in bankruptcy
      or a federal bankruptcy court and should have been the subject of such
      remittance absent such prohibition.

     

    “Stepdown
      Percentage”: With respect to any Distribution Date, the percentage indicated
      below:

     

    
      	
              Distribution
                Date

            	
              Stepdown
                Percentage

            
	
              October
                2006
                through September
                2011

            	
              0%

            
	
              October
                2011
                through September
                2012

            	
              30%

            
	
              October
                2012
                through September
                2013

            	
              40%

            
	
              October
                2013
                through September
                2014

            	
              60%

            
	
              October
                2014
                through September
                2015

            	
              80%

            
	
              October
                2015
                and thereafter

            	
              100%

            

    

    

    “Subordinate
      Certificates”: The Class B-1, Class B-2, Class B-3, Class B-4, Class B-5 and
      Class B-6 Certificates.

     

    “Subordinate
      Percentage”: For any Distribution Date, the difference between 100% and the
      Senior Percentage for such date.

     

    “Subordinate
      Prepayment Percentage”: With respect to any Distribution Date and each Class of
      Subordinate Certificates, under the applicable circumstances set forth below,
      the respective percentages set forth below:

     

    (i) For
      any
      Distribution Date prior to the Distribution Date in October 2011,
      0%.

     

    (ii) For
      any
      Distribution Date for which clause (i) does not apply, and on which any Class
      of
      Subordinate Certificates are outstanding:

     

    (a) in
      the
      case of the Class of Subordinate Certificates then outstanding with the Highest
      Priority and each other Class of Subordinate Certificates for which the related
      Prepayment Distribution Trigger has been satisfied, a fraction, expressed as
      a
      percentage, the numerator of which is the Certificate Principal Balance of
      such
      Class immediately prior to such date and the denominator of which is the sum
      of
      the Certificate Principal Balances immediately prior to such date of (1) the
      Class of Subordinate Certificates then outstanding with the Highest Priority
      and
      (2) all other Classes of Subordinate Certificates for which the respective
      Prepayment Distribution Triggers have been satisfied; and

     

    (b) in
      the
      case of each other Class of Subordinate Certificates for which the Prepayment
      Distribution Triggers have not been satisfied, 0%; and

     

    (iii) Notwithstanding
      the foregoing, if the application of the foregoing percentages on any
      Distribution Date as provided in Section 4.01(c) of this Agreement (determined
      without regard to the proviso to the definition of “Subordinate Principal
      Distribution Amount”) would result in a distribution in respect of principal of
      any Class or Classes of Subordinate Certificates in an amount greater than
      the
      remaining Certificate Principal Balance thereof (any such class, a “Maturing
      Class”), then: (a) the Subordinate Prepayment Percentage of each Maturing Class
      shall be reduced to a level that, when applied as described above, would exactly
      reduce the Certificate Principal Balance of such Class to zero; (b) the
      Subordinate Prepayment Percentage of each other Class of Subordinate
      Certificates (any such Class, a “Non-Maturing Class”) shall be recalculated in
      accordance with the provisions in paragraph (ii) above, as if the Certificate
      Principal Balance of each Maturing Class had been reduced to zero (such
      percentage as recalculated, the “Recalculated Percentage”); (c) the total amount
      of the reductions in the Subordinate Prepayment Percentages of the Maturing
      Class or Classes pursuant to clause (a) of this sentence, expressed as an
      aggregate percentage, shall be allocated among the Non-Maturing Classes in
      proportion to their respective Recalculated Percentages (the portion of such
      aggregate reduction so allocated to any Non-Maturing Class, the “Adjustment
      Percentage”); and (d) for purposes of such Distribution Date, the Subordinate
      Prepayment Percentage of each Non-Maturing Class shall be equal to the sum
      of
      (1) the Subordinate Prepayment Percentage thereof, calculated in accordance
      with
      the provisions in paragraph (ii) above as if the Certificate Principal Balance
      of each Maturing Class had not been reduced to zero, plus (2) the related
      Adjustment Percentage.

     

    “Subordinate
      Principal Distribution Amount”: With respect to any Distribution Date and each
      Class of Class B Certificates, the sum of the following:

     

    (i) the
      product of (x) the related Class B Percentage for such Class and (y) the
      aggregate of the following amounts:

     

    (1) the
      principal portion of each Monthly Payment due during the related Due Period
      on
      each Outstanding Mortgage Loan, whether or not received on or prior to the
      related Determination Date minus the principal portion of any Debt Service
      Reduction, which together with other Bankruptcy Losses exceeds the Bankruptcy
      Amount;

     

    (2) the
      Stated Principal Balance of any Mortgage Loan repurchased during the related
      Prepayment Period pursuant to Section 2.02, 2.03, 3.15 or 3.16; and

     

    (3) the
      principal portion of all other unscheduled collections (other than Principal
      Prepayments in Full and Curtailments and amounts received in connection with
      a
      Cash Liquidation or REO Disposition of a Mortgage Loan, including without
      limitation Insurance Proceeds, Liquidation Proceeds, Subsequent Recoveries
      and
      REO Proceeds) received during the related Prepayment Period to the extent
      applied by the Master Servicer as recoveries of principal of the related
      Mortgage Loan pursuant to Section 3.16;

     

    (ii) such
      Class’s pro rata share, based on the Certificate Principal Balance of each Class
      of Class B Certificates then outstanding, of, with respect to each Mortgage
      Loan, for which a Cash Liquidation or a REO Disposition occurred during the
      related Prepayment Period and did not result in any Excess Special Hazard
      Losses, Excess Fraud Losses, Excess Bankruptcy Losses or Extraordinary Losses,
      an amount equal to the related unscheduled collections (including without
      limitation Insurance Proceeds, Liquidation Proceeds and REO Proceeds) to the
      extent applied by the Master Servicer as recoveries of principal of the related
      Mortgage Loan pursuant to Section 3.16, to the extent such collections are
      not
      otherwise distributed to the Senior Certificates;

     

    (iii) the
      product of (x) the related Subordinate Prepayment Percentage for such
      Distribution Date and (y) the aggregate of all Principal Prepayments in Full
      and
      Curtailments on the Mortgage Loans received in the related Prepayment Period,
      to
      the extent not payable to the Senior Certificates; and

     

    (iv) if
      such
      Class is the Class of Class B Certificates then outstanding with the Highest
      Priority, an amount equal to the Excess Subordinate Principal Amount;
      and

     

    (v) any
      amounts described in clauses (i), (ii) and (iii) as determined for any previous
      Distribution Date, that remain undistributed to the extent that such amounts
      are
      not attributable to Realized Losses which have been allocated to a Class of
      Subordinate Certificates;

     

    provided,
      however, that such amount shall in no event exceed the outstanding Certificate
      Principal Balance of such Class of Certificates immediately prior to such
      date.

     

    “Subsequent
      Recoveries”: Any amount recovered by the Master Servicer (net of reimbursable
      expenses) with respect to a Liquidated Mortgage Loan with respect to which
      a
      Realized Loss was incurred after the liquidation or disposition of such Mortgage
      Loan.

     

    “Sub-Servicer”:
      Any Person with which the Master Servicer has entered into a Sub-Servicing
      Agreement and which meets the qualifications of a Sub-Servicer pursuant to
      Section 3.02.

     

    “Sub-Servicing
      Account”: An account established by a Sub-Servicer which meets the requirements
      set forth in Section 3.08 and is otherwise acceptable to the Master
      Servicer.

     

    “Sub-Servicing
      Agreement”: The written contract between the Master Servicer and a Sub-Servicer
      relating to servicing and administration of certain Mortgage Loans as provided
      in Section 3.02.

     

    “Substitution
      Shortfall Amount”: As defined in Section 2.03(c) hereof.

     

    “Tax
      Matters Person”: The tax matters person appointed pursuant to Section 9.01(c)
      hereof.

     

    “Tax
      Returns”: The federal income tax return on Internal Revenue Service Form 1066,
      U.S. Real Estate Mortgage Investment Conduit Income Tax Return, including
      Schedule Q thereto, Quarterly Notice to Residual Interest Holders of the REMIC
      Taxable Income or Net Loss Allocation, or any successor forms, to be filed
      on
      behalf of the Trust in its capacity as a REMIC under the REMIC Provisions,
      together with any and all other information reports or returns that may be
      required to be famished to the Certificateholders or filed with the Internal
      Revenue Service or any other governmental taxing authority under any applicable
      provisions of federal, state or local tax laws.

     

    “Termination
      Price”: As defined in Section 10.01(a) hereof.

     

    “Transition
      Cost: Any documented fees, expenses and allocated costs reasonably incurred
      by a
      successor master servicer or the Trustee in connection with a transfer of
      servicing from the Master Servicer to a successor master servicer, including
      without limitation, any costs or expenses associated with the complete transfer
      of all master servicing data and the completion, correction or manipulation
      of
      such master servicing data as may be required by the Trustee to correct any
      errors or insufficiencies in the master servicing data or otherwise to enable
      the Trustee to master service the Mortgage Loans properly and
      effectively.

     

    “Trustee
      Fee”: With respect to each Mortgage Loan and for any calendar month, an amount
      equal to one month’s interest at the applicable Trustee Fee Rate on the same
      principal amount on which interest on such Mortgage Loan accrues for such
      calendar month. Notwithstanding the foregoing, in no event shall the aggregate
      Trustee Fee in a calendar year be less than $7,000.

     

    “Trustee
      Fee Rate”: With respect to any Mortgage Loan, a rate equal to 0.0125% per
      annum.

     

    “Trust
      Fund”: REMIC I, REMIC II and the Buydown Account, if any.

     

    “Uncertificated
      Monthly Interest Distributable Amount”: An amount equal to the interest accrued
      during the related Interest Accrual Period on the Uncertificated Principal
      Balance of each Class of REMIC I Regular Interest at the then-applicable
      Uncertificated Pass-Through Rate. The Uncertificated Monthly Interest
      Distributable Amount on any Class of REMIC I Regular Interest will be reduced
      by
      the amount of (i) Prepayment Interest Shortfalls (to the extent not offset
      by
      the Master Servicer with a payment of Compensating Interest as provided in
      Section 3.24), (ii) the interest portion (adjusted to the Net Mortgage Rate)
      of
      Realized Losses (including Excess Losses) not allocated solely to one or more
      specific Classes of Certificates pursuant to Section 4.02, (iii) the interest
      portion of Advances previously made with respect to a Mortgage Loan or REO
      Property which remained unreimbursed following the Cash Liquidation or REO
      Disposition of such Mortgage Loan or REO Property that were made with respect
      to
      delinquencies that were ultimately determined to be Excess Losses and (iv)
      any
      other interest shortfalls not covered by the subordination provided by the
      Class
      B Certificates, including Relief Act Shortfalls, with all such reductions
      allocated among all of the REMIC I Regular Interests in proportion to their
      respective amounts of Uncertificated Monthly Interest Distributable Amount
      payable on such Distribution Date which would have resulted absent such
      reductions.

     

    “Uncertificated
      Pass-Through Rate”: With respect to each REMIC I Regular Interest and any
      Distribution Date, a per annum rate equal to the weighted average of the Net
      Mortgage Rate on each mortgage loan as of the Due Date in the related Due
      Period, weighted on the basis of the respective Stated Principal Balances of
      such Mortgage Loans as of the day immediately preceding such Distribution Date
      (or, with respect to the initial Distribution Date, at the close of business
      on
      the Cut-off Date).

     

    “Uncertificated
      Principal Balance”: The principal amount of any REMIC I Regular Interest
      outstanding as of any date of determination. The Uncertificated Principal
      Balance of each REMIC I Regular Interest initially shall be equal to the amount
      set forth in the Preliminary Statement with respect to such REMIC I Regular
      Interest, and thereafter shall be reduced by all distributions of principal
      made
      on such REMIC I Regular Interest and shall be further reduced by Realized Losses
      allocated thereto. The Uncertificated Principal Balance of each REMIC I Regular
      Interest shall never be less than zero.

     

    “Underwriting
      Guide”: The underwriting guide of the Master Servicer, as revised from time to
      time.

     

    “Uninsured
      Cause” Any cause of damage to property subject to a Mortgage such that the
      complete restoration of such property is not fully reimbursable by the hazard
      insurance policies.

     

    “United
      States Person” or “U.S. Person”: A citizen or resident of the United States, a
      corporation or partnership (including an entity treated as a corporation or
      partnership for federal income tax purposes) created or organized in, or under
      the laws of, the United States or any state thereof or the District of Columbia
      (except, in the case of a partnership, to the extent provided in regulations),
      provided that, for purposes solely of the Class R Certificates, no partnership
      or other entity treated as a partnership for United States federal income tax
      purposes shall be treated as a United States Person unless all persons that
      own
      an interest in such partnership either directly or through any entity that
      is
      not a corporation for United States federal income tax purposes are United
      States Persons, or an estate whose income is subject to United States federal
      income tax regardless of its source, or a trust if (i) a court within the United
      States is able to exercise primary supervision over the administration of the
      trust and one or more such United States Persons have the authority to control
      all substantial decisions of the trust or (ii) it is a trust which was in
      existence on August 20, 1996, and was treated as a United States person, for
      federal income tax purposes, on the previous day, and elected to continue to
      be
      so treated.

     

    “Value”:
      With respect to any Mortgaged Property, the value thereof as determined by
      an
      independent appraisal (or other collateral assessment, permitted by the
      Underwriting Guide) made at the time of the origination of the related Mortgage
      Loan; except that, with respect to any Mortgage Loan that is a purchase money
      mortgage loan, the lesser of (i) the value thereof as determined by an
      independent appraisal (or other collateral assessment, permitted by the
      Underwriting Guide) made at the time of the origination of such Mortgage Loan,
      if any, and (ii) the sales price of the related Mortgaged Property.

     

    “Voting
      Rights”: The portion of the voting rights of all of the Certificates which is
      allocated to any Certificate. The Voting Rights allocated among Holders of
      such
      Certificates outstanding shall be the fraction, expressed as a percentage,
      the
      numerator of which is the aggregate Certificate Principal Balance of all the
      Certificates of such Class then outstanding and the denominator of which is
      the
      aggregate Certificate Principal Balance of all the Certificates then
      outstanding. 98% of all Voting Rights will be allocated among all holders of
      the
      Certificates (other than the Class R Certificates and Class A-3 Certificates)
      in
      proportion to their then outstanding Certificate Principal Balances. 1.0% of
      all
      Voting Rights will be allocated to the holders of the Class A-3 Certificates.
      0.50% and 0.50% of all Voting Rights will be allocated to the holders of the
      Class R-I Certificates and Class R-II Certificates, respectively, in proportion
      to the Percentage Interests evidenced by their respective Certificates;
      provided, however, that any Certificate registered in the name of the Master
      Servicer, the Depositor or the Trustee or any of their respective affiliates
      shall not be included in the calculation of Voting Rights.

     

    “Written
      Order to Authenticate”: A written order by which the Depositor directs the
      Trustee to issue the Certificates.

     

    Section
      1.02 Accounting.

     

    Unless
      otherwise specified herein, for the purpose of any definition or calculation,
      whenever amounts are required to be netted, subtracted or added or any
      distributions are taken into account such definition or calculation and any
      related definitions or calculations shall be determined without duplication
      of
      such functions.

     

     

    
 

    ARTICLE
      II

    CONVEYANCE
      OF MORTGAGE LOANS;

    ORIGINAL
      ISSUANCE OF CERTIFICATES

     

    Section
      2.01 Conveyance
      of Mortgage Loans.

     

    The
      Depositor, concurrently with the execution and delivery hereof, does hereby
      transfer, assign, set over and otherwise convey to the Trustee without recourse
      for the benefit of the Certificateholders all the right, title and interest
      of
      the Depositor, including any security interest therein for the benefit of the
      Depositor, in and to the Mortgage Loans identified on the Mortgage Loan
      Schedule, the rights of the Depositor under the Mortgage Loan Purchase Agreement
      (except Section 3.2 thereof), the interest in the Limited Purpose Surety Bond
      transferred to the Trustee pursuant to Section 2.03(e) and all other assets
      included or to be included in the Trust Fund. Such assignment includes all
      interest and principal received by the Depositor or the Master Servicer on
      or
      with respect to the Mortgage Loans (but excluding any payments of principal
      and
      interest due on or prior to the Cut-off Date). The Depositor herewith delivers
      to the Trustee an executed copy of the Mortgage Loan Purchase
      Agreement.

     

    The
      parties hereto agree that it is not intended that any mortgage loan be included
      in the Trust that is (i) a “High-Cost Home Loan” as defined in the New Jersey
      Home Ownership Act effective November 27, 2003, (ii) a “High-Cost Home Loan” as
      defined in the New Mexico Home Loan Protection Act effective January 1, 2004,
      (iii) a “High Cost Home Mortgage Loan” as defined in the Massachusetts Predatory
      Home Practices Act effective November 7, 2004 or (iv) a “High-Cost Home Loan” as
      defined in the Indiana High Cost Home Loan Law effective January 1,
      2005.

     

    In
      connection with the transactions contemplated by this Agreement, PHH Mortgage
      Corporation and the Trustee shall enter into an Assignment, Assumption and
      Recognition Agreement with MLCC, in the form of Exhibit K hereto, pursuant
      to
      which PHH Mortgage Corporation shall assign to the Trustee, for the benefit
      of
      the Certificateholders, all of its right, title and interest in and to the
      Pledged Asset Servicing Agreement with respect to the Pledged Asset Loans,
      and
      the Trustee shall assume all of PHH Mortgage Corporation’s obligations under the
      Pledged Asset Servicing Agreement with respect to the Pledged Asset Loans from
      and after the date hereof.

     

    In
      connection with the transfer and assignment described herein, the Master
      Servicer on behalf of the Depositor, shall deliver to, and deposit with, the
      Trustee, the following documents or instruments:

     

    (A) with
      respect to each Mortgage Loan, other than a Cooperative Loan:

     

    (i) the
      original Mortgage Note endorsed “Pay to the order of Citibank, N.A., as Trustee
      for the registered holders of the PHHMC Mortgage Pass-Through Certificates,
      Series 2006-3, without recourse”, or endorsed “Pay to the order
      of_____________________ without recourse,” and signed in the name of the last
      named endorsee by an authorized officer, together with all prior and intervening
      endorsements showing a complete chain of endorsement from the originator to
      the
      Person so endorsing to the last endorsee;

     

    (ii) the
      original Mortgage, noting the presence of the MIN of the Mortgage Loan and
      language indicating that the Mortgage Loan is a MOM Loan if the Mortgage Loan
      is
      a MOM Loan, with evidence of recording thereon which have been recorded, with
      evidence of recording thereon or a copy of the Mortgage certified by the public
      recording office in which such Mortgage has been recorded;

     

    (iii) Unless
      the Mortgage Loan is registered on the MERS® System, an original Assignment of
      the Mortgage (A) executed in the following form “Citibank, N.A., as Trustee for
      the registered holders of the PHHMC Mortgage Pass-Through Certificates, Series
      2006-3”, or (B) in blank, which assignment appears to be in form and substance
      acceptable for recording;

     

    (iv) the
      original recorded Assignment or Assignments of the Mortgage showing a complete
      chain of assignment from the originator to the Person assigning the Mortgage
      to
      the Trustee (or to MERS, if the Mortgage Loan is registered on the MERS® System
      and noting the presence of a MIN) as contemplated by the immediately preceding
      clause (iii), if applicable and only to the extent available to the Depositor
      with evidence of recording thereon;

     

    (v) the
      originals of all assumption, modification, consolidation or extension
      agreements, with evidence of recording thereon, if any;

     

    (vi) a
      copy of
      any guarantee (other than Pledged Assets) executed in connection with the
      Mortgage Note;

     

    (vii) the
      original of any security agreement, chattel mortgage or equivalent document
      executed in connection with the Mortgage;

     

    (viii) the
      original power of attorney, if applicable; and

     

    (ix) if
      such
      Mortgage Loan is a Buydown Mortgage Loan (as shown in the Mortgage Loan
      Schedule), the original Buydown Agreement or a copy thereof; and

     

    (B) in
      addition, with respect to each Mortgage Loan that is a Pledged Asset Loan (as
      indicated on the Mortgage Loan Schedule):

     

    (i) a
      copy of
      the related Mortgage 100K
      Pledge
      Agreement or Parent Power Agreement, as applicable; and

     

    (ii) a
      copy of
      the related UCC-1, to the extent that MLCC was required to deliver such UCC-1
      to
      the Master Servicer, and an original form UCC-3, if applicable, to the extent
      that MLCC was required to deliver such UCC-3 to the Master Servicer;
      or

     

    (C) with
      respect to each Mortgage Loan that is a Cooperative Loan (as indicated on the
      Mortgage Loan Schedule):

     

    (i) the
      original Mortgage Note endorsed “Pay to the order of Citibank, N.A., as Trustee
      for the registered holders of the PHHMC Mortgage Pass-Through Certificates,
      Series 2006-3, without recourse”, or endorsed “Pay to the order of
      _____________________ without recourse,” and signed in the name of the last
      named endorsee by an authorized officer, together with all prior and intervening
      endorsements showing a complete chain of endorsement from the originator to
      the
      Person so endorsing to the last endorsee;

     

    (ii) the
      original duly executed assignment of Security Agreement to the
      Trustee;

     

    (iii) the
      acknowledgment copy of the original executed Form UCC-1 (or certified copy
      thereof) with respect to the Security Agreement, and any required continuation
      statements;

     

    (iv) the
      acknowledgment copy of the original executed Form UCC-3 with respect to the
      security agreement, indicating the Trustee as the assignee of the secured
      party;

     

    (v) the
      stock
      certificate representing the Cooperative Assets allocated to the cooperative
      unit, with a stock power in blank attached;

     

    (vi) the
      original collateral assignment of the proprietary lease by Mortgagor to the
      originator;

     

    (vii) a
      copy of
      the recognition agreement;

     

    (viii) if
      applicable and to the extent available, the original intervening assignments,
      including warehousing assignments, if any, showing, to the extent available,
      an
      unbroken chain of the related Mortgage Loan to the Trustee, together with a
      copy
      of the related Form UCC-3 with evidence of filing thereon; and

     

    (ix) the
      originals of each assumption, modification or substitution agreement, if any,
      relating to the Mortgage Loan;

     

    provided,
      however, that in lieu of the foregoing, the Depositor may deliver the following
      documents, under the circumstances set forth below: (x) in lieu of the original
      Mortgage, assignments to the Trustee or intervening assignments thereof which
      have been delivered, are being delivered or will, upon receipt of recording
      information relating to the Mortgage required to be included thereon, be
      delivered to recording offices for recording and have not been returned to
      the
      Depositor within 270 days of the Closing Date, the Depositor may deliver a
      true
      copy thereof with an Officer’s Certificate certifying that such Mortgage,
      assignment to the Trustee or intervening assignment has been delivered to the
      appropriate recording office for recording; and (y) in lieu of the Mortgage,
      assignment to the Trustee or intervening assignments thereof, if the applicable
      jurisdiction retains the originals of such documents (as evidenced by a
      certification from the Depositor or the Master Servicer, to such effect) the
      Depositor may deliver photocopies of such documents containing an original
      certification by the judicial or other governmental authority of the
      jurisdiction where such documents were recorded; and provided, further, however,
      that in the case of Mortgage Loans which have been prepaid in full after the
      Cut-off Date and prior to the Closing Date, the Depositor, in lieu of delivering
      the above documents, may deliver to the Trustee a certification to such effect
      and shall deposit all amounts paid in respect of such Mortgage Loans in the
      Distribution Account on the Closing Date. The Depositor shall deliver such
      original documents (including any original documents as to which certified
      copies had previously been delivered) to the Trustee promptly after they are
      received.

     

    The
      Depositor may, in lieu of delivering the original of the documents set forth
      in
      Section 2.01(A), (B) and (C) (other than Section 2.01(A)(i) and Section
      2.01(C)(i)) (or copies thereof as permitted by this Section 2.01) to the
      Trustee, deliver such documents to the Master Servicer, and the Master Servicer
      shall hold such documents in trust for the use and benefit of all present and
      future Certificateholders until such time as is set forth in the next sentence.
      Within 60 days following the earlier of (i) the receipt of the original of
      all
      of the documents or instruments set forth in Section 2.01(A), (B) and (C) (other
      than Section 2.01(A)(i) and Section 2.01(C)(i)) (or copies thereof as permitted
      by such Section) for any Mortgage Loan and (ii) a written request by the Trustee
      to deliver those documents with respect to any or all of the Mortgage Loans
      then
      being held by the Master Servicer, the Master Servicer shall deliver a complete
      set of such documents to the Trustee.

     

    The
      Depositor shall, at its expense, cause the Assignment of the Mortgage to the
      Trustee to be recorded not later than 270 days after the Closing Date, unless
      (a) such recordation is not required by the Rating Agency or an Opinion of
      Counsel has been provided as set forth below in this Section 2.01 or (b) MERS
      is
      identified on the Mortgage or on a properly recorded assignment of the Mortgage
      as the mortgagee of record. With respect to the Cooperative Loans, the Depositor
      will, promptly after the Closing Date, cause the related financing statements
      (if not yet filed) and an assignment thereof from the Depositor to the Trustee
      to be filed in the appropriate offices. The Depositor need not cause to be
      recorded any assignment in any jurisdiction under the laws of which, as
      evidenced by an Opinion of Counsel delivered by the Depositor to the Trustee
      and
      the Rating Agency, the recordation of such assignment is not necessary to
      protect the Trustee’s interest in the related Mortgage Loan; provided, however,
      notwithstanding the delivery of any Opinion of Counsel, each assignment shall
      be
      submitted for recording by the Depositor in the manner described above, at
      no
      expense to the Trust Fund or the Trustee, upon the earliest to occur of: (i)
      reasonable direction by the Holders of Certificates evidencing Fractional
      Undivided Interests aggregating not less than 25% of the Trust Fund, (ii) the
      occurrence of a Master Servicer Event of Termination, (iii) the occurrence
      of a
      bankruptcy, insolvency or foreclosure relating to the Depositor, (iv) the
      occurrence of a servicing transfer as described in Section 7.02 hereof and
      (v)
      with respect to any one assignment, the occurrence of a bankruptcy, insolvency
      or foreclosure relating to the Mortgagor under the related Mortgage.
      Notwithstanding the foregoing, if the Depositor fails to pay the cost of
      recording the assignments, such expense will be paid by the Trustee and the
      Trustee shall be reimbursed for such expenses by the Trust Fund in accordance
      with Section 8.05.

     

    In
      connection with the assignment of any Mortgage Loan registered on the MERS®
System, the Depositor further agrees that it will cause, at the Depositor’s own
      expense, within 30 Business Days after the Closing Date, the MERS® System to
      indicate that such Mortgage Loans have been assigned by the Depositor to the
      Trustee in accordance with this Agreement for the benefit of the
      Certificateholders by including (or deleting, in the case of Mortgage Loans
      which are repurchased in accordance with this Agreement) in such computer files
      (a) the code in the field which identifies the specific Trustee and (b) the
      code
      in the field “Pool Field” which identifies the series of the Certificates issued
      in connection with such Mortgage Loans. The Depositor further agrees that it
      will not, and will not permit the Master Servicer to, and the Master Servicer
      agrees that it will not, alter the codes referenced in this paragraph with
      respect to any Mortgage Loan during the term of this Agreement unless and until
      such Mortgage Loan is repurchased in accordance with the terms of this
      Agreement.

     

    If
      any
      original Mortgage Note referred to in Section 2.01(A)(i) or 2.01(C)(i) above
      cannot be located, the obligations of the Depositor to deliver such documents
      shall be deemed to be satisfied upon delivery to the Trustee of a photocopy
      of
      such Mortgage Note, if available, with a Lost Note Affidavit. If any of the
      original Mortgage Notes for which a Lost Note Affidavit was delivered to the
      Trustee is subsequently located, such original Mortgage Note shall be delivered
      to the Trustee within three Business Days.

     

    Section
      2.02 Acceptance
      of Trust Fund by the Trustee.

     

    Subject
      to the provisions of Section 2.01 and subject to any exceptions noted on the
      exception report described in the next paragraph below, the Trustee acknowledges
      receipt of the documents referred to in Section 2.01 above and declares that
      it
      holds and will hold such documents and the other documents delivered to it
      constituting the Mortgage File, and that it holds or will hold all such assets
      and such other assets included in the definition of the “Trust Fund” and the
      rights of the Sellers with respect to any Pledged Assets and the Limited Purpose
      Surety Bond assigned to the Trustee pursuant to Section 2.03(e) in trust for
      the
      exclusive use and benefit of all present and future
      Certificateholders.

     

    The
      Trustee agrees, for the benefit of the Certificateholders, to review each
      Mortgage File on or before the Closing Date and to certify on the Closing Date
      in substantially the form attached hereto as Exhibit I-1 that, as to each
      Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage
      Loan
      paid in full or any Mortgage Loan specifically identified in the exception
      report annexed thereto as not being covered by such certification), (i) all
      documents constituting part of such Mortgage File required to be delivered
      to it
      pursuant to this Agreement are in its possession, provided that with respect
      to
      the documents described in Section 2.01(A)(v), (vi) and (vii) and 2.01(C)(ix)
      to
      the extent the Trustee has actual knowledge that such documents exist, (ii)
      such
      documents have been reviewed by it and are not torn, mutilated, defaced or
      otherwise altered (except if initialed by the obligor) and relate to such
      Mortgage Loan, (iii) based on its examination and only as to the foregoing,
      the
      information set forth in the Mortgage Loan Schedule that corresponds to items
      (i) through (iii) (except the ZIP Code), (ix) and (xv) of the definition of
      “Mortgage Loan Schedule” accurately reflects information set forth in the
      Mortgage File. Notwithstanding anything to the contrary in this Agreement,
      it is
      herein acknowledged that, in conducting such review, the Trustee is under no
      duty or obligation to inspect, review or examine any such documents,
      instruments, certificates or other papers to determine whether they are genuine,
      enforceable, or appropriate for the represented purpose or whether they have
      actually been recorded or that they are other than what they purport to be
      on
      their face, or to determine whether any Person executing any documents is
      authorized to do so or whether any signature is genuine.

     

    The
      Trustee agrees, for the benefit of the Certificateholders, to review each
      Mortgage File within 60 days following the Closing Date and to certify in
      substantially the form attached hereto as Exhibit I-2 that, as to each Mortgage
      Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid
      in
      full or any Mortgage Loan specifically identified in the exception report
      annexed thereto as not being covered by such certification), (i) all documents
      constituting part of such Mortgage File (other than such documents described
      in
      Section 2.01(A)(v)) required to be delivered to it pursuant to this Agreement
      are in its possession, provided that with respect to the documents described
      in
      Section 2.01(A)(v), (vi) and (vii) and 2.01(C)(ix) to the extent the Trustee
      has
      actual knowledge that such documents exist, (ii) such documents have been
      reviewed by it and are not torn, mutilated, defaced or otherwise altered (except
      if initialed by the obligor) and appear regular on their face and relate to
      such
      Mortgage Loan, (iii) based on its examination and only as to the foregoing,
      the
      information set forth in the Mortgage Loan Schedule that corresponds to items
      (i) through (iii)(except the ZIP code), (ix) and (xv) of the definition of
      “Mortgage Loan Schedule” accurately reflects information set forth in the
      Mortgage File. It is herein acknowledged that, in conducting such review, the
      Trustee is under no duty or obligation (i) to inspect, review or examine any
      such documents, instruments, certificates or other papers to determine whether
      they are genuine, enforceable, or appropriate for the represented purpose or
      whether they have actually been recorded or that they are other than what they
      purport to be on their face, or to determine whether any Person executing any
      documents is authorized to do so or whether any signature is
      genuine.

     

    Prior
      to
      the first anniversary date of this Agreement the Trustee shall deliver to the
      Depositor and the Master Servicer a final certification in the form annexed
      hereto as Exhibit I-2 evidencing the completeness of the Mortgage Files, with
      any applicable exceptions noted thereon, except with respect to the documents
      described in Section 2.01(A)(v), (vi) and (vii) and 2.01(C)(ix), to the extent
      the Trustee has actual knowledge that such documents exist.

     

    If
      in the
      process of reviewing the Mortgage Files and making or preparing, as the case
      may
      be, the certifications referred to above, the Trustee finds any document or
      documents constituting a part of a Mortgage File to be missing or defective
      in
      any material respect, at the conclusion of its review the Trustee shall so
      notify the Depositor and the Master Servicer. In addition, upon the discovery
      by
      the Depositor, the Master Servicer or the Trustee of a breach of any of the
      representations and warranties made by the Sellers in the Mortgage Loan Purchase
      Agreement in respect of any Mortgage Loan which materially adversely affects
      such Mortgage Loan or the interests of the related Certificateholders in such
      Mortgage Loan, the party discovering such breach shall give prompt written
      notice to the other parties.

     

    The
      Trustee shall, at the written request and expense of any Certificateholder,
      provide a written report to such Certificateholder of all Mortgage Files
      released to the Master Servicer for servicing purposes.

     

    Section
      2.03 Repurchase
      or Substitution of Mortgage Loans by the Sellers- Assignment of Interest in
      Pledged Assets.

     

    (a) Upon
      discovery or receipt of notice of any materially defective document in, or
      that
      a document is missing from, a Mortgage File or of the breach by a Seller of
      any
      representation, warranty or covenant under the Mortgage Loan Purchase Agreement
      in respect of any Mortgage Loan which materially adversely affects the value
      of
      such Mortgage Loan or the interest therein of the Certificateholders, by the
      Trustee, the Master Servicer or the Depositor shall promptly notify such Seller
      and the Trustee, the Master Servicer and the Depositor of such defect, missing
      document or breach and request that such Seller deliver such missing document
      or
      cure such defect or breach within 90 days from the date such Seller was notified
      of such missing document, defect or breach, and if such Seller does not deliver
      such missing document or cure such defect or breach in all material respects
      during such period, the Master Servicer (or, in accordance with Section 3.02(b),
      the Trustee) shall enforce the obligations of such Seller under the Mortgage
      Loan Purchase Agreement to repurchase such Mortgage Loan from the Trust Fund
      at
      the Purchase Price within 90 days after the date on which such Seller was
      notified (subject to Section 2.03(d)) of such missing document, defect or
      breach, if and to the extent that such Seller is obligated to do so under the
      Mortgage Loan Purchase Agreement. If such defect or breach can ultimately be
      cured but is not reasonably expected to be cured within the 90-day period,
      then
      the applicable Seller shall have such additional time, if any, as is reasonable,
      to cure such defect or breach, provided that the applicable Seller has commenced
      curing or correcting such defect or breach and is diligently pursuing same.
      The
      Purchase Price for the repurchased Mortgage Loan shall be deposited in the
      Collection Account, within three Business Days of expiration of the applicable
      time period referred to above, and the Trustee, upon receipt of written
      certification from the Master Servicer of such deposit, shall release to the
      applicable Seller the related Mortgage File and shall execute and deliver such
      instruments of transfer or assignment, in each case without recourse, as such
      Seller shall furnish to it and as shall be necessary to vest in such Seller
      any
      Mortgage Loan released pursuant hereto, and the Trustee shall have no further
      responsibility with regard to such Mortgage File. In lieu of repurchasing any
      such Mortgage Loan as provided above, if so provided in the related Mortgage
      Loan Purchase Agreement, a Seller may cause such Mortgage Loan to be removed
      from the Trust Fund (in which case it shall become a Defective Mortgage Loan)
      and substitute one or more Eligible Substitute Mortgage Loans in the manner
      and
      subject to the limitations set forth in Section 2.03(d). If the breach of
      representation and warranty that gave rise to the obligation to repurchase
      or
      substitute a Mortgage Loan pursuant to Section 3.2 of the Mortgage Loan Purchase
      Agreement was the representation and warranty set forth in clause (xlvi) of
      Section 3.1 thereof, then the Master Servicer shall request that PHH Mortgage
      pay to the Trust Fund, concurrently with and in addition to the remedies
      provided in the preceding four sentences, an amount equal to any liability,
      penalty or expense that was actually incurred and paid out of or on behalf
      of
      the Trust Fund, and that directly resulted from such breach, or if incurred
      and
      paid by the Trust Fund thereafter, concurrently with such payment. In
      furtherance of the foregoing, if the Seller that repurchases the Mortgage Loan
      is not a member of MERS and the Mortgage is registered on the MERS® System, the
      Master Servicer, at its own expense and without any right of reimbursement,
      shall cause MERS to execute and deliver an assignment of the Mortgage in
      recordable form to transfer the Mortgage from MERS to such Seller and shall
      cause such Mortgage to be removed from registration on the MERS® System in
      accordance with MERS’ rules and regulations. It is understood and agreed that
      the obligation of a Seller to cure or to repurchase (or to substitute for)
      any
      Mortgage Loan as to which a document is missing, a material defect in a
      constituent document exists or as to which such a breach has occurred and is
      continuing shall constitute the sole remedy respecting such omission, defect
      or
      breach available to the Depositor, the Master Servicer or the Trustee on behalf
      of the Certificateholders.

     

    (b) Within
      90
      days of the earlier of discovery by the Master Servicer or receipt of notice
      by
      the Master Servicer of the breach of any representation, warranty or covenant
      of
      the Master Servicer set forth in Section 2.04 which materially and adversely
      affects the interests of the Certificateholders in any Mortgage Loan, the Master
      Servicer shall cure such breach in all material respects.

     

    (c) Any
      substitution of Eligible Substitute Mortgage Loans for Defective Mortgage Loans
      made pursuant to Section 2.03(a), in the case of a Seller, must be effected
      prior to the date which is two years after the Closing Date.

     

    As
      to any
      Defective Mortgage Loan for which a Seller substitutes a Eligible Substitute
      Mortgage Loan or Loans, such substitution shall be effected by such Seller
      delivering to the Trustee, for such Eligible Substitute Mortgage Loan or Loans,
      the Mortgage Note, the Mortgage, the Assignment to the Trustee, and such other
      documents and agreements, with all necessary endorsements thereon, as are
      required by Section 2.01, together with an Officers’ Certificate providing that
      each such Eligible Substitute Mortgage Loan satisfies the definition thereof
      and
      specifying the Substitution Shortfall Amount (as described below), if any,
      in
      connection with such substitution. The Trustee shall acknowledge receipt of
      the
      original Mortgage Note for such Eligible Substitute Mortgage Loan or Loans
      and,
      within ten Business Days thereafter, review such documents in the manner
      specified in Section 2.02 and deliver to the Depositor and the Master Servicer,
      with respect to such Eligible Substitute Mortgage Loan or Loans, a certification
      substantially in the form attached hereto as Exhibit I-1, with any applicable
      exceptions noted thereon. Within one year of the date of substitution, the
      Trustee shall deliver to the Depositor and the Master Servicer a certification
      substantially in the form of Exhibit I-2 hereto with respect to such Eligible
      Substitute Mortgage Loan or Loans, with any applicable exceptions noted thereon.
      Monthly Payments due with respect to Eligible Substitute Mortgage Loans in
      the
      month of substitution are not part of the Trust Fund and will be retained by
      the
      related Seller. For the month of substitution, distributions to
      Certificateholders will reflect the Monthly Payment due on such Defective
      Mortgage Loan on or before the Due Date in the month of substitution, and the
      related Seller shall thereafter be entitled to retain all amounts subsequently
      received in respect of such Defective Mortgage Loan. The Depositor shall give
      or
      cause to be given written notice to the Certificateholders that such
      substitution has taken place, shall amend the Mortgage Loan Schedule to reflect
      the removal of such Defective Mortgage Loan from the terms of this Agreement
      and
      the substitution of the Eligible Substitute Mortgage Loan or Loans and shall
      deliver a copy of such amended Mortgage Loan Schedule to the Trustee. Upon
      such
      substitution, such Eligible Substitute Mortgage Loan or Loans shall constitute
      part of the Mortgage Pool and shall be subject in all respects to the terms
      of
      this Agreement and, in the case of a substitution effected by a Seller, the
      Mortgage Loan Purchase Agreement, including, in the case of a substitution
      effected by a Seller, all applicable representations and warranties thereof
      included in the Mortgage Loan Purchase Agreement in each case as of the date
      of
      substitution.

     

    For
      any
      month in which a Seller substitutes one or more Eligible Substitute Mortgage
      Loans for one or more Defective Mortgage Loans, the Master Servicer will
      determine the amount (the “Substitution Shortfall Amount”), if any, by which the
      aggregate principal balance of all such Eligible Substitute Mortgage Loans
      as of
      the date of substitution is less than the aggregate Stated Principal Balance
      of
      all such Defective Mortgage Loans (in each case after application of the
      principal portion of the Monthly Payments due in the month of substitution
      that
      are to be distributed to the Certificateholders in the month of substitution).
      On the date of such substitution, the applicable Seller will deliver or cause
      to
      be delivered to the Master Servicer for deposit in the Collection Account an
      amount equal to the Substitution Shortfall Amount, if any, and the Trustee,
      upon
      receipt of the related Eligible Substitute Mortgage Loan or Loans and
      certification by the Master Servicer of such deposit, shall release to the
      applicable Seller the related Mortgage File or Files and shall execute and
      deliver such instruments of transfer or assignment, in each case without
      recourse, as such Seller shall deliver to it and as shall be necessary to vest
      therein any Defective Mortgage Loan released pursuant hereto.

     

    In
      addition, the applicable Seller shall obtain at its own expense and deliver
      to
      the Trustee an Opinion of Counsel to the effect that such substitution will
      not
      cause (a) any federal tax to be imposed on the Trust Fund, including without
      limitation, any federal tax imposed on “prohibited transactions” under Section
      860F(a)(1) of the Code or on “contributions after the startup date” under
      Section 860G(d)(1) of the Code, or (b) any REMIC to fail to qualify as a REMIC
      at any time that any Certificate is outstanding.

     

    (d) Upon
      discovery by the Depositor, a Seller, the Master Servicer or the Trustee that
      any Mortgage Loan does not constitute a “qualified mortgage” within the meaning
      of Section 860G(a)(3) of the Code, the party discovering such fact shall within
      two Business Days give written notice thereof to the other parties. In
      connection therewith, the related Seller shall repurchase or, subject to the
      limitations set forth in Section 2.03(c), substitute one or more Eligible
      Substitute Mortgage Loans for the affected Mortgage Loan within 60 days of
      the
      earlier of discovery or receipt of such notice with respect to such affected
      Mortgage Loan. Such repurchase or substitution shall be made by the related
      Seller, as the case may be, if the affected Mortgage Loan’s status as a
      non-qualified mortgage is or results from a breach of any representation,
      warranty or covenant made by the related Seller under the Mortgage Loan Purchase
      Agreement. Any such repurchase or substitution shall be made in the same manner
      as set forth in Sections 2.03(a), if made by the related Seller. The Trustee
      shall reconvey to the related Seller the Mortgage Loan to be released pursuant
      hereto in the same manner, and on the same terms and conditions, as it would
      a
      Mortgage Loan repurchased for breach of a representation or
      warranty.

     

    (e) The
      Depositor hereby assigns to the Trustee its security interest in and to any
      Pledged Assets, its right to receive amounts due or to become due in respect
      of
      any Pledged Assets, all of its rights in each Pledged Asset Agreement, and
      its
      rights as beneficiary under the Limited Purpose Surety Bond in respect of any
      Pledged Asset Loans. With respect to any Pledged Asset Loan, the Pledged Asset
      Servicer shall cause to be filed in the appropriate recording office a Form
      UCC-3 giving notice of the assignment of the related security interest to the
      Trust Fund and shall thereafter cause the timely filing of all necessary
      continuation statements with regard to such financing statements.

     

    Section
      2.04 Representations,
      Warranties and Covenants of the Master Servicer.

     

    The
      Master Servicer hereby represents, warrants and covenants to the Trustee, for
      the benefit of each of the Trustee and the Certificateholders, and to the
      Depositor, that as of the Closing Date or as of such date specifically provided
      herein:

     

    (i) The
      Master Servicer is a corporation duly organized, validly existing and in good
      standing under the laws of the State of New Jersey and is duly authorized and
      qualified to transact any and all business contemplated by this Agreement to
      be
      conducted by the Master Servicer in any state in which a Mortgaged Property
      is
      located or is otherwise not required under applicable law to effect such
      qualification and, in any event, is in compliance with the doing business laws
      of any such State, to the extent necessary to ensure its ability to enforce
      each
      Mortgage Loan and to service the Mortgage Loans in accordance with the terms
      of
      this Agreement;

     

    (ii) The
      Master Servicer has the full corporate power and authority to service each
      Mortgage Loan, and to execute, deliver and perform, and to enter into and
      consummate the transactions contemplated by this Agreement and has duly
      authorized by all necessary corporate action on the part of the Master Servicer
      the execution, delivery and performance of this Agreement; and this Agreement,
      assuming the due authorization, execution and delivery thereof by the Depositor
      and the Trustee, constitutes a legal, valid and binding obligation of the Master
      Servicer, enforceable against the Master Servicer in accordance with its terms,
      except to the extent that (a) the enforceability thereof may be limited by
      bankruptcy, insolvency, moratorium, receivership and other similar laws relating
      to creditors’ rights generally and (b) the remedy of specific performance and
      injunctive and other forms of equitable relief may be subject to the equitable
      defenses and to the discretion of the court before which any proceeding therefor
      may be brought;

     

    (iii) The
      execution and delivery of this Agreement by the Master Servicer, the servicing
      of the Mortgage Loans by the Master Servicer hereunder, the consummation of
      any
      other of the transactions herein contemplated, and the fulfillment of or
      compliance with the terms hereof are in the ordinary course of business of
      the
      Master Servicer and will not (A) result in a breach of any term or provision
      of
      the charter or by-laws of the Master Servicer or (B) conflict with, result
      in a
      breach, violation or acceleration of, or result in a default under, the terms
      of
      any other material agreement or instrument to which the Master Servicer is
      a
      party or by which it may be bound, or any statute, order or regulation
      applicable to the Master Servicer of any court, regulatory body, administrative
      agency or governmental body having jurisdiction over the Master Servicer; and
      the Master Servicer is not a party to, bound by, or in breach or violation
      of
      any indenture or other agreement or instrument, or subject to or in violation
      of
      any statute, order or regulation of any court, regulatory body, administrative
      agency or governmental body having jurisdiction over it, which materially and
      adversely affects or, to the Master Servicer’s knowledge, would in the future
      materially and adversely affect, (x) the ability of the Master Servicer to
      perform its obligations under this Agreement or (y) the business, operations,
      financial condition, properties or assets of the Master Servicer taken as a
      whole;

     

    (iv) The
      Master Servicer is an approved seller/servicer for Fannie Mae or Freddie Mac
      in
      good standing and is a HUD approved mortgagee pursuant to Section 203 of the
      National Housing Act;

     

    (v) No
      litigation is pending against the Master Servicer that would materially and
      adversely affect the execution, delivery or enforceability of this Agreement
      or
      the ability of the Master Servicer to service the Mortgage Loans or to perform
      any of its other obligations hereunder in accordance with the terms
      hereof;

     

    (vi) No
      consent, approval, authorization or order of any court or governmental agency
      or
      body is required for the execution, delivery and performance by the Master
      Servicer of, or compliance by the Master Servicer with, this Agreement or the
      consummation of the transactions contemplated by this Agreement, except for
      such
      consents, approvals, authorizations or orders, if any, that have been obtained
      prior to the Closing Date; and

     

    (vii) The
      Master Servicer is a member of MERS in good standing, and will comply in all
      material respects with the rules and procedures of MERS in connection with
      the
      servicing of the Mortgage Loans that are registered with MERS.

     

    It
      is
      understood and agreed that the representations, warranties and covenants set
      forth in this Section 2.04 shall survive delivery of the Mortgage Files to
      the
      Trustee and shall inure to the benefit of the Trustee, the Depositor and the
      Certificateholders. Upon discovery by any of the Depositor, the Master Servicer
      or the Trustee of a breach of any of the foregoing representations, warranties
      and covenants which materially and adversely affects the value of any Mortgage
      Loan or the interests therein of the Certificateholders, the party discovering
      such breach shall give prompt written notice (but in no event later than two
      Business Days following such discovery) to the Trustee. Subject to Section
      7.01,
      the obligation of the Master Servicer set forth in Section 2.03(c) to cure
      breaches shall constitute the sole remedies against the Master Servicer
      available to the Certificateholders, the Depositor or the Trustee on behalf
      of
      the Certificateholders respecting a breach of the representations, warranties
      and covenants contained in this Section 2.04.

     

    Section
      2.05 Representations
      and Warranties of the Depositor.

     

    The
      Depositor represents and warrants to the Trust and the Trustee on behalf of
      the
      Certificateholders as follows:

     

    (i) This
      agreement constitutes a legal, valid and binding obligation of the Depositor,
      enforceable against the Depositor in accordance with its terms, except as
      enforceability may be limited by applicable bankruptcy, insolvency,
      reorganization, moratorium or other similar laws now or hereafter in effect
      affecting the enforcement of creditors’ rights in general and except as such
      enforceability may be limited by general principles of equity (whether
      considered in a proceeding at law or in equity);

     

    (ii) Immediately
      prior to the sale and assignment by the Depositor to the Trustee on behalf
      of
      the Trust of each Mortgage Loan, the Depositor had good and marketable title
      to
      each Mortgage Loan (insofar as such title was conveyed to it by a Seller, as
      set
      forth in the Mortgage Loan Purchase Agreement) subject to no prior lien, claim,
      participation interest, mortgage, security interest, pledge, charge or other
      encumbrance or other interest of any nature;

     

    (iii) As
      of the
      Closing Date, the Depositor has transferred all right, title and interest in
      the
      Mortgage Loans to the Trustee on behalf of the Trust;

     

    (iv) The
      Depositor has not transferred the Mortgage Loans to the Trustee on behalf of
      the
      Trust with any intent to hinder, delay or defraud any of its
      creditors;

     

    (v) The
      Depositor has been duly formed and is validly existing as a limited liability
      company in good standing under the laws of Delaware, with full corporate power
      and authority to own its assets and conduct its business as presently being
      conducted;

     

    (vi) The
      Depositor is not in violation of its certificate of formation or limited
      liability company agreement or in default in the performance or observance
      of
      any material obligation, agreement, covenant or condition contained in any
      contract, indenture, mortgage, loan agreement, note, lease or other instrument
      to which the Depositor is a party or by which it or its properties may be bound,
      which default might result in any material adverse changes in the financial
      condition, earnings, affairs or business of the Depositor or which might
      materially and adversely affect the properties or assets, taken as a whole,
      of
      the Depositor;

     

    (vii) The
      execution, delivery and performance of this Agreement by the Depositor, and
      the
      consummation of the transactions contemplated thereby, do not and will not
      result in a material breach or violation of any of the terms or provisions
      of,
      or, to the knowledge of the Depositor, constitute a default under, any
      indenture, mortgage, deed of trust, loan agreement or other agreement or
      instrument to which the Depositor is a party or by which the Depositor is bound
      or to which any of the property or assets of the Depositor is subject, nor
      will
      such actions result in any violation of the provisions of the certificate of
      formation or limited liability company agreement of the Depositor or, to the
      best of the Depositor’s knowledge without independent investigation, any statute
      or any order, rule or regulation of any court or governmental agency or body
      having jurisdiction over the Depositor or any of its properties or assets
      (except for such conflicts, breaches, violations and defaults as would not
      have
      a material adverse effect on the ability of the Depositor to perform its
      obligations under this Agreement);

     

    (viii) To
      the
      best of the Depositor’s knowledge without any independent investigation, no
      consent, approval, authorization, order, registration or qualification of or
      with any court or governmental agency or body of the United States or any other
      jurisdiction is required for the issuance of the Certificates, or the
      consummation by the Depositor of the other transactions contemplated by this
      Agreement, except such consents, approvals, authorizations, registrations or
      qualifications as (a) may be required under State securities or Blue Sky laws,
      (b) have been previously obtained or (c) the failure of which to obtain would
      not have a material adverse effect on the performance by the Depositor of its
      obligations under, or the validity or enforceability of, this Agreement;
      and

     

    (ix) There
      are
      no actions, proceedings or investigations pending before or, to the Depositor’s
      knowledge, threatened by any court, administrative agency or other tribunal
      to
      which the Depositor is a party or of which any of its properties is the subject:
      (a) which if determined adversely to the Depositor would have a material adverse
      effect on the business, results of operations or financial condition of the
      Depositor; (b) asserting the invalidity of this Agreement or the Certificates;
      (c) seeking to prevent the issuance of the Certificates or the consummation
      by
      the Depositor of any of the transactions contemplated by this Agreement, as
      the
      case may be; (d) which might materially and adversely affect the performance
      by
      the Depositor of its obligations under, or the validity or enforceability of,
      this Agreement.

     

    Section
      2.06 Purpose
      and Powers of the Trust.

     

    The
      purpose of the common law trust, as created hereunder, is to engage in the
      following activities:

     

    (i) acquire
      and hold the Mortgage Loans and the other assets of the Trust Fund and the
      proceeds therefrom;

     

    (ii) to
      issue
      the Certificates to or at the direction of the Depositor in exchange for the
      Mortgage Loans;

     

    (iii) to
      make
      payments on the Certificates;

     

    (iv) to
      engage
      in those activities that are reasonably necessary, suitable or convenient to
      accomplish the foregoing or are incidental thereto or connected therewith;
      and

     

    (v) subject
      to compliance with this Agreement, to engage in such other activities as may
      be
      required in connection with conservation of the Trust Fund and the making of
      distributions to the Certificateholders.

     

    The
      trust
      is hereby authorized to engage in the foregoing activities. The Trustee shall
      not cause the trust to engage in any activity other than in connection with
      the
      foregoing or other than as required or authorized by the terms of this Agreement
      while any Certificate is outstanding.

     

    Section
      2.07 Issuance
      of Certificates.

     

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

     

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

     

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

     

    

    ARTICLE
      III

    ADMINISTRATION
      AND SERVICING OF THE TRUST FUND

     

    Section
      3.01 Master
      Servicer to Act as Master Servicer.

     

    The
      Master Servicer shall service and administer the Mortgage Loans on behalf of
      the
      Trustee and in the best interests of and for the benefit of the
      Certificateholders (as determined by the Master Servicer in its reasonable
      judgment) in accordance with the terms of this Agreement and the respective
      Mortgage Loans and, to the extent consistent with such terms, in the same manner
      in which it services and administers similar mortgage loans for its own
      portfolio, giving due consideration to customary and usual standards of practice
      of prudent mortgage lenders and loan servicers administering similar mortgage
      loans but without regard to:

     

    (i) any
      relationship that the Master Servicer, any Sub-Servicer or any Affiliate of
      the
      Master Servicer or any Sub-Servicer may have with the related
      Mortgagor;

     

    (ii) the
      ownership of any Certificate by the Master Servicer or any Affiliate of the
      Master Servicer;

     

    (iii) the
      Master Servicer’s obligation to make Advances or Servicing Advances;
      or

     

    (iv) the
      Master Servicer’s or any Sub-Servicer’s right to receive compensation for its
      services hereunder or with respect to any particular transaction.

     

    To
      the
      extent consistent with the foregoing, the Master Servicer shall also seek to
      maximize the timely and complete recovery of principal and interest on the
      Mortgage Notes. Subject only to the above-described servicing standards and
      the
      terms of this Agreement and of the respective Mortgage Loans, the Master
      Servicer shall have full power and authority, acting alone or through
      Sub-Servicers as provided in Section 3.02, to do or cause to be done any and
      all
      things in connection with such servicing and administration which it may deem
      necessary or desirable. Without limiting the generality of the foregoing, the
      Master Servicer in its own name or in the name of a Sub-Servicer is hereby
      authorized and empowered by the Trustee when the Master Servicer believes it
      appropriate in its best judgment in accordance with the servicing standards
      set
      forth above, to execute and deliver, on behalf of the Certificateholders and
      the
      Trustee, and upon notice to the Trustee, any and all instruments of satisfaction
      or cancellation, or of partial or full release or discharge, and all other
      comparable instruments, with respect to the Mortgage Loans and the Mortgaged
      Properties and to institute foreclosure proceedings or obtain a deed-in-lieu
      of
      foreclosure so as to convert the ownership of such properties, and to hold
      or
      cause to be held title to such properties, on behalf of the Trustee and
      Certificateholders. The Master Servicer shall service and administer the
      Mortgage Loans in accordance with applicable state and federal law and shall
      provide to the Mortgagors any reports required to be provided to them thereby.
      The Master Servicer shall also comply in the performance of this Agreement
      with
      all reasonable rules and requirements of each insurer under each Primary
      Insurance Policy and any standard hazard insurance policy. Subject to Section
      3.17, the Trustee shall execute, at the written request of the Master Servicer,
      and furnish to the Master Servicer and any Sub-Servicer such documents as are
      necessary or appropriate to enable the Master Servicer or any Sub-Servicer
      to
      carry out their servicing and administrative duties hereunder, and the Trustee
      hereby grants to the Master Servicer a power of attorney to carry out such
      duties. The Trustee shall not be liable for the actions of the Master Servicer
      or any Sub-Servicers under such powers of attorney.

     

    In
      accordance with the standards of the preceding paragraph, the Master Servicer
      shall advance or cause to be advanced funds as necessary for the purpose of
      effecting the timely payment of taxes and assessments on the Mortgaged
      Properties, which advances shall be Servicing Advances reimbursable in the
      first
      instance from related collections from the Mortgagors pursuant to Section 3.09,
      and further as provided in Section 3.11. Any cost incurred by the Master
      Servicer or by Sub-Servicers in effecting the timely payment of taxes and
      assessments on a Mortgaged Property shall not, for the purpose of calculating
      distributions to Certificateholders, be added to the unpaid principal balance
      of
      the related Mortgage Loan, notwithstanding that the terms of such Mortgage
      Loan
      so permit.

     

    The
      Master Servicer further is authorized and empowered by the Trustee, on behalf
      of
      the Certificateholders and the Trustee, in its own name or in the name of the
      Sub-Servicer, when the Master Servicer or the Sub-Servicer, as the case may
      be,
      believes it is appropriate in its best judgment to register any Mortgage Loan
      on
      the MERS® System, or cause the removal from the registration of any Mortgage
      Loan on the MERS® System, to execute and deliver, on behalf of the Trustee and
      the Certificateholders or any of them, any and all instruments of assignment
      and
      other comparable instruments with respect to such assignment or re-recording
      of
      a Mortgage in the name of MERS, solely as nominee for the Trustee and its
      successors and assigns. Any expenses incurred in connection with the actions
      described in the preceding sentence shall be borne by the Master Servicer in
      accordance with Section 3.18, with no right of reimbursement; provided, that
      if,
      as a result of MERS discontinuing or becoming unable to continue operations
      in
      connection with the MERS System, it becomes necessary to remove any Mortgage
      Loan from registration on the MERS System and to arrange for the assignment
      of
      the related Mortgages to the Trustee, then any related expenses shall be
      reimbursable to the Master Servicer.

     

    Notwithstanding
      anything in this Agreement to the contrary, the Master Servicer may not make
      any
      future advances with respect to a Mortgage Loan (except as provided in Section
      4.06) and the Master Servicer shall not (i) permit any modification with respect
      to any Mortgage Loan that would change the Loan Rate, reduce or increase the
      principal balance (except for reductions resulting from actual payments of
      principal) or change the final maturity date on such Mortgage Loan (unless,
      as
      provided in Section 3.07, the Mortgagor is in default with respect to the
      Mortgage Loan or such default is, in the judgment of the Master Servicer,
      reasonably foreseeable) or (ii) permit any modification, waiver or amendment
      of
      any term of any Mortgage Loan that would both (A) effect an exchange or
      reissuance of such Mortgage Loan under Section 1001 of the Code (or final,
      temporary or proposed Treasury regulations promulgated thereunder) and (B)
      cause
      either the Trust Fund to fail to qualify as a REMIC under the Code or the
      imposition of any tax on “prohibited transactions” or “contributions after the
      startup date” under the REMIC Provisions.

     

    Notwithstanding
      any other provision of this Agreement or the Pledged Asset Servicing Agreement
      to the contrary, except as provided below, the Master Servicer shall have no
      duty or obligation to service and administer the Pledged Assets and the Master
      Servicer shall not be deemed to be the Pledged Asset Servicer, unless and until
      MLCC’s obligations to administer the Pledged Assets under the Pledged Asset
      Servicing Agreement have been terminated with respect to the Pledged Asset
      Loans, in which case, the Master Servicer shall be bound to service and
      administer the Pledged Assets and the Limited Purpose Surety Bond in accordance
      with the provisions of this Agreement and the related Pledged Asset Agreements
      from the date of such termination. The Trustee, as assignee of the Pledged
      Asset
      Servicing Agreement, shall enforce the obligations of MLCC to service and
      administer the Pledged Assets as provided in the Pledged Asset Servicing
      Agreement, and shall take appropriate action thereunder if MLCC fails to
      substantially comply with its obligations to administer the Pledged Assets.
      In
      the event the Trustee receives an indemnification payment from MLCC under
      Section 3 of the Pledged Asset Servicing Agreement that is attributable to
      losses resulting from MLCC’s failure to administer the Pledged Assets in
      accordance with the terms of the Pledged Asset Servicing Agreement in connection
      with Pledged Asset Loans, the Trustee shall deposit such amount in the
      Collection Account.

     

    The
      Master Servicer may delegate its responsibilities under this Agreement;
      provided, however, that no such delegation shall release the Master Servicer
      from the responsibilities or liabilities arising under this
      Agreement.

     

    Section
      3.02 Sub-Servicing
      Agreements Between the Master Servicer and Sub-Servicers.

     

    (a) The
      Master Servicer may enter into Sub-Servicing Agreements (provided that such
      agreements would not result in a withdrawal or a downgrading by the Rating
      Agency of the rating on any Class of Certificates) with Sub-Servicers, for
      the
      servicing and administration of the Mortgage Loans. Notwithstanding any other
      provision of this Agreement, the Master Servicer shall not be precluded from
      selling all or part of the Servicing Fee relating to any Mortgage Loans to
      any
      Sub-Servicer, provided that with respect to any Mortgage Loan as to which the
      Master Servicer sells all or a part of the related Servicing Fee, the Master
      Servicer shall retain full responsibility under this Agreement for the servicing
      activities relating to such Mortgage Loan.

     

    Each
      Sub-Servicer shall be (i) authorized to transact business in the state or states
      in which the related Mortgaged Properties it is to service are situated, if
      and
      to the extent required by applicable law to enable the Sub-Servicer to perform
      its obligations hereunder and under the Sub-Servicing Agreement, (ii) an
      institution approved as a mortgage loan originator by the Federal Housing
      Administration or an institution the deposit accounts of which are insured
      by
      the FDIC and (iii) a Freddie Mac or Fannie Mae approved mortgage servicer.
      Each
      Sub-Servicing Agreement must impose on the Sub-Servicer requirements conforming
      to the provisions set forth in Section 3.08 and provide for servicing of the
      Mortgage Loans consistent with the terms of this Agreement. The Master Servicer
      will examine each Sub-Servicing Agreement and will be familiar with the terms
      thereof. The terms of any Sub-Servicing Agreement will not be inconsistent
      with
      any of the provisions of this Agreement. The Master Servicer and the
      Sub-Servicers may enter into and make amendments to the Sub-Servicing Agreements
      or enter into different forms of Sub-Servicing Agreements; provided, however,
      that any such amendments or different forms shall be consistent with and not
      violate the provisions of this Agreement, and that no such amendment or
      different form shall be made or entered into which could be reasonably expected
      to be materially adverse to the interests of the Certificateholders, without
      the
      consent of the Holders of Certificates entitled to at least 66% of the Voting
      Rights. Any variation without the consent of the Holders of Certificates
      entitled to at least 66% of the Voting Rights from the provisions set forth
      in
      Section 3.08 relating to insurance or priority requirements of Sub-Servicing
      Accounts, or credits and charges to the Sub-Servicing Accounts or the timing
      and
      amount of remittances by the Sub-Servicers to the Master Servicer, are
      conclusively deemed to be inconsistent with this Agreement and therefore
      prohibited. The Master Servicer shall deliver to the Trustee copies of all
      Sub-Servicing Agreements, and any amendments or modifications thereof, promptly
      upon the Master Servicer’s execution and delivery of such
      instruments.

     

    (b) As
      part
      of its servicing activities hereunder, the Master Servicer (except as otherwise
      provided in the last sentence of this paragraph), for the benefit of the Trustee
      and the Certificateholders, shall enforce the obligations of each Sub-Servicer
      under the related Sub-Servicing Agreement and of each Seller under the Mortgage
      Loan Purchase Agreement, including, without limitation, any obligation to make
      advances in respect of delinquent payments as required by a Sub-Servicing
      Agreement, or to purchase a Mortgage Loan on account of missing or defective
      documentation or on account of a breach of a representation, warranty or
      covenant, as described in Section 2.03(a). Such enforcement, including, without
      limitation, the legal prosecution of claims, termination of Sub-Servicing
      Agreements, and the pursuit of other appropriate remedies, shall be in such
      form
      and carried out to such an extent and at such time as the Master Servicer,
      in
      its good faith business judgment, would require were it the owner of the related
      Mortgage Loans. The Master Servicer shall pay the costs of such enforcement
      at
      its own expense, and shall be reimbursed therefor only (i) from a general
      recovery resulting from such enforcement, to the extent, if any, that such
      recovery exceeds all amounts due in respect of the related Mortgage Loans,
      or
      (ii) from a specific recovery of costs, expenses or attorneys’ fees against the
      party against whom such enforcement is directed. Enforcement of the obligations
      under the Mortgage Loan Purchase Agreement against the Sellers shall be effected
      by the Master Servicer, in accordance with the foregoing provisions of this
      paragraph.

     

    Section
      3.03 Successor
      Sub-Servicers.

     

    The
      Master Servicer shall be entitled to terminate any Sub-Servicing Agreement
      and
      the rights and obligations of any Sub-Servicer pursuant to any Sub-Servicing
      Agreement in accordance with the terms and conditions of such Sub-Servicing
      Agreement. In the event of termination of any Sub Servicer, all servicing
      obligations of such Sub-Servicer shall be assumed simultaneously by the Master
      Servicer without any act or deed on the part of such Sub-Servicer or the Master
      Servicer, and the Master Servicer either shall service directly the related
      Mortgage Loans or shall enter into a Sub-Servicing Agreement with a successor
      Sub-Servicer which qualifies under Section 3.02.

     

    Any
      Sub-Servicing Agreement shall include the provision that such agreement may
      be
      immediately terminated by the Trustee without fee, in accordance with the terms
      of this Agreement, in the event that the Master Servicer shall, for any reason,
      no longer be the Master Servicer (including termination due to a Master Servicer
      Event of Termination).

     

    Section
      3.04 Liability
      of the Master Servicer.

     

    Notwithstanding
      any Sub-Servicing Agreement, any of the provisions of this Agreement relating
      to
      agreements or arrangements between the Master Servicer and a Sub-Servicer or
      reference to actions taken through a Sub-Servicer or otherwise, the Master
      Servicer shall remain obligated and primarily liable to the Trustee and the
      Certificateholders for the servicing and administering of the Mortgage Loans
      in
      accordance with the provisions of Section 3.01 without diminution of such
      obligation or liability by virtue of such Sub-Servicing Agreements or
      arrangements or by virtue of indemnification from the Sub-Servicer and to the
      same extent and under the same terms and conditions as if the Master Servicer
      alone were servicing and administering the Mortgage Loans. The Master Servicer
      shall be entitled to enter into any agreement with a Sub-Servicer for
      indemnification of the Master Servicer by such Sub-Servicer and nothing
      contained in this Agreement shall be deemed to limit or modify such
      indemnification.

     

    Section
      3.05 No
      Contractual Relationship Between Sub-Servicers and Trustee or
      Certificateholders.

     

    Any
      Sub-Servicing Agreement that may be entered into and any transactions or
      services relating to the Mortgage Loans involving a Sub-Servicer in its capacity
      as such shall be deemed to be between the Sub-Servicer and the Master Servicer
      alone, and the Trustee and Certificateholders shall not be deemed parties
      thereto and shall have no claims, rights, obligations, duties or liabilities
      with respect to the Sub-Servicer except as set forth in Section 3.06. The Master
      Servicer shall be solely liable for all fees owed by it to any Sub-Servicer,
      irrespective of whether the Master Servicer’s compensation pursuant to this
      Agreement is sufficient to pay such fees.

     

    Section
      3.06 Assumption
      or Termination of Sub-Servicing Agreements by Trustee.

     

    In
      the
      event the Master Servicer shall for any reason no longer be the master servicer
      (including by reason of the occurrence of a Master Servicer Event of
      Termination), the Trustee or its designee or the successor master servicer
      as
      appointed pursuant to Section 7.02 herein, shall thereupon assume all of the
      rights and obligations of the Master Servicer under each Sub-Servicing Agreement
      that the Master Servicer may have entered into, unless the Trustee elects to
      terminate any Sub-Servicing Agreement in accordance with its terms as provided
      in Section 3.03. Upon such assumption, the Trustee, its designee or the
      successor servicer for the Trustee appointed pursuant to Section 7.02 shall
      be
      deemed, subject to Section 3.03, to have assumed all of the Master Servicer’s
      interest therein and to have replaced the Master Servicer as a party to each
      Sub-Servicing Agreement to the same extent as if each Sub-Servicing Agreement
      had been assigned to the assuming party, except that (i) the Master Servicer
      shall not thereby be relieved of any liability or obligations under any
      Sub-Servicing Agreement and (ii) none of the Trustee, its designee or any
      successor master servicer shall be deemed to have assumed any liability or
      obligation of the Master Servicer that arose before it ceased to be the Master
      Servicer.

     

    The
      Master Servicer at its expense shall, upon request of the Trustee, deliver
      to
      the assuming party all documents and records relating to each Sub-Servicing
      Agreement and the Mortgage Loans then being serviced and an accounting of
      amounts collected and held by or on behalf of it, and otherwise use its best
      efforts to effect the orderly and efficient transfer of the Sub-Servicing
      Agreements to the assuming party.

     

    Section
      3.07 Collection
      of Certain Mortgage Loan Payments.

     

    The
      Master Servicer shall make reasonable efforts to collect all payments called
      for
      under the terms and provisions of the Mortgage Loans, and shall, to the extent
      such procedures shall be consistent with this Agreement and the terms and
      provisions of any related Primary Insurance Policy and any other applicable
      insurance policies, follow such collection procedures as it would follow with
      respect to mortgage loans comparable to the Mortgage Loans and held for its
      own
      account. Consistent with the foregoing, the Master Servicer may in its
      discretion (i) waive any late payment charge or, if applicable, penalty
      interest, only upon determining that the coverage of such Mortgage Loan by
      the
      related Primary Insurance Policy, if any, will not be affected, or (ii) extend
      the due dates for Monthly Payments due on a Mortgage Note for a period of not
      greater than 180 days; provided that any extension pursuant to clause (ii)
      above
      shall not affect the amortization schedule of any Mortgage Loan for purposes
      of
      any computation hereunder, except as provided below. In the event of any such
      arrangement pursuant to clause (ii) above, the Master Servicer shall make timely
      advances on such Mortgage Loan during such extension pursuant to Section 4.06
      and in accordance with the amortization schedule of such Mortgage Loan without
      modification thereof by reason of such arrangements. Notwithstanding the
      foregoing, in the event that any Mortgage Loan is in default or, in the judgment
      of the Master Servicer, such default is reasonably foreseeable, the Master
      Servicer, consistent with the standards set forth in Section 3.01, may also,
      waive, modify or vary any term of such Mortgage Loan (including modifications
      that would change the Loan Rate, forgive the payment of principal or interest
      or
      extend the final maturity date of such Mortgage Loan), accept payment from
      the
      related Mortgagor of an amount less than the Stated Principal Balance in final
      satisfaction of such Mortgage Loan (such payment, a “Short Pay-off”) or consent
      to the postponement of strict compliance with any such term or otherwise grant
      indulgence to any Mortgagor.

     

    Section
      3.08 Sub-Servicing
      Accounts.

     

    In
      those
      cases where a Sub-Servicer is servicing a Mortgage Loan pursuant to a
      Sub-Servicing Agreement, the Sub-Servicer will be required to establish and
      maintain one or more accounts (collectively, the “Sub-Servicing Account”). The
      Sub-Servicing Account shall be an Eligible Account and shall comply with all
      requirements of this Agreement relating to the Collection Account. The
      Sub-Servicer shall deposit in the clearing account (which account must be an
      Eligible Account) in which it customarily deposits payments and collections
      on
      mortgage loans in connection with its mortgage loan servicing activities on
      a
      daily basis, and in no event more than one Business Day after the Sub-Servicer’s
      receipt thereof, all proceeds of Mortgage Loans received by the Sub-Servicer
      less its servicing compensation to the extent permitted by the Sub-Servicing
      Agreement, and shall thereafter deposit such amounts in the Sub-Servicing
      Account, in no event more than two Business Days after the deposit of such
      funds
      into the clearing account. The Sub-Servicer shall thereafter deposit such
      proceeds in the Collection Account or remit such proceeds to the Master Servicer
      for deposit in the Collection Account not later than two Business Days after
      the
      deposit of such amounts in the Sub-Servicing Account. For purposes of this
      Agreement, the Master Servicer shall be deemed to have received payments on
      the
      Mortgage Loans when the Sub-Servicer receives such payments.

     

    Section
      3.09 Collection
      of Taxes, Assessments and Similar Items; Servicing Accounts.

     

    The
      Master Servicer shall establish and maintain one or more accounts (the
“Servicing Accounts”), into which all collections from the Mortgagors (or
      related advances from Sub-Servicers) for the payment of ground rents, taxes,
      assessments, fire and hazard insurance premiums, Primary Insurance Policy
      premiums, water charges, sewer rents and comparable items for the account of
      the
      Mortgagors (“Escrow Payments”) shall be deposited and retained. Servicing
      Accounts shall be Eligible Accounts. The Master Servicer shall deposit in the
      clearing account (which account must be an Eligible Account) in which it
      customarily deposits payments and collections on mortgage loans in connection
      with its mortgage loan servicing activities on a daily basis, and in no event
      more than one Business Day after the Master Servicer’s receipt thereof, all
      Escrow Payments collected on account of the Mortgage Loans and shall thereafter
      deposit such Escrow Payments in the Servicing Accounts, in no event more than
      two Business Days after the deposit of such funds in the clearing account,
      for
      the purpose of effecting the payment of any such items as required under the
      terms of this Agreement. Withdrawals of amounts from a Servicing Account may
      be
      made only to (i) effect payment of Escrow Payments; (ii) reimburse the Master
      Servicer (or a Sub-Servicer to the extent provided in the related Sub-Servicing
      Agreement) out of related collections for any advances made pursuant to Section
      3.01 (with respect to taxes and assessments) and Section 3.14 (with respect
      to
      hazard insurance); (iii) refund to Mortgagors any sums as may be determined
      to
      be overages; (iv) make Permitted Investments as provided in Section 3.12; (v)
      pay interest, to the Master Servicer or to the Mortgagor if required and as
      described below, on balances in the Servicing Account; (vi) clear and terminate
      the Servicing Account at the termination of the Master Servicer’s obligations
      and responsibilities in respect of the Mortgage Loans under this Agreement
      in
      accordance with Article IX; or (vii) recover amounts deposited in error. As
      part
      of its servicing duties, the Master Servicer or Sub-Servicers shall pay to
      the
      Mortgagors interest on funds in Servicing Accounts, to the extent required
      by
      law and, to the extent that interest earned on funds in the Servicing Accounts
      is insufficient, to pay such interest from its or their own funds, without
      any
      reimbursement therefor. To the extent that a Mortgage does not provide for
      Escrow Payments, the Master Servicer shall determine whether any such payments
      are made by the Mortgagor in a manner and at a time that avoids the loss of
      the
      Mortgaged Property due to a tax sale or the foreclosure of a tax lien. The
      Master Servicer assumes full responsibility for the payment of all such bills
      and shall effect payments of all such bills irrespective of the Mortgagor’s
      faithful performance in the payment of same or the making of the Escrow Payments
      and shall make advances from its own funds to effect such payments. The Master
      Servicer shall be entitled to retain any interest paid on funds deposited in
      the
      Servicing Account to effect Escrow Payments other than interest on escrowed
      funds required by law to be paid to the Mortgagor.

     

    Section
      3.10 Collection
      Account and Distribution Account.

     

    (a) On
      behalf
      of the Trust Fund, the Master Servicer shall establish and maintain one or
      more
      accounts (such account or accounts, the “Collection Account”), held in trust for
      the benefit of the Trustee and the Certificateholders. On behalf of the Trust
      Fund, the Master Servicer shall deposit or cause to be deposited in the clearing
      account (which account must be an Eligible Account) in which it customarily
      deposits payments and collections on mortgage loans in connection with its
      mortgage loan servicing activities on a daily basis, and in no event more than
      one Business Day after the Master Servicer’s receipt thereof, and shall
      thereafter deposit in the Collection Account, in no event more than two Business
      Days after the deposit of such funds into the clearing account, as and when
      received or as otherwise required hereunder, the following payments and
      collections received or made by it subsequent to the Cut-off Date (other than
      in
      respect of principal or interest on the related Mortgage Loans due on or before
      the Cut-off Date), or payments (other than Principal Prepayments) received
      by it
      on or prior to the Cut-off Date but allocable to a Due Period subsequent
      thereto:

     

    (i) all
      payments on account of principal, including Principal Prepayments, on the
      Mortgage Loans;

     

    (ii) all
      payments on account of interest (net of the related Servicing Fee) on each
      Mortgage Loan;

     

    (iii) all
      Insurance Proceeds, Liquidation Proceeds and Subsequent Recoveries (other than
      proceeds collected in respect of any particular REO Property and amounts paid
      by
      the Master Servicer in connection with a purchase of Mortgage Loans and REO
      Properties pursuant to Section 9.01);

     

    (iv) any
      amounts required to be deposited pursuant to Section 3.12 in connection with
      any
      losses realized on Permitted Investments with respect to funds held in the
      Collection Account;

     

    (v) any
      amounts required to be deposited by the Master Servicer pursuant to the second
      paragraph of Section 3.14(a) in respect of any blanket policy
      deductibles;

     

    (vi) all
      proceeds of any Mortgage Loan repurchased or purchased in accordance with
      Section 2.03 or Section 9.01;

     

    (vii) all
      amounts required to be deposited in connection with shortfalls in principal
      amount of Eligible Substitute Mortgage Loans pursuant to Section
      2.03;

     

    (viii) any
      amounts required to be transferred from any Buydown Account pursuant to Section
      3.25; and

     

    (ix) any
      (x)
      amounts realized by MLCC or (y) Required Surety Payments received by the Trustee
      or the Master Servicer in respect of any Pledged Assets.

     

    For
      purposes of the immediately preceding sentence, the Cut-off Date with respect
      to
      any Eligible Substitute Mortgage Loan shall be deemed to be the date of
      substitution.

     

    The
      foregoing requirements for deposit in the Collection Account shall be exclusive,
      it being understood and agreed that, without limiting the generality of the
      foregoing, payments in the nature of late payment charges or assumption fees
      need not be deposited by the Master Servicer in the Collection Account and
      shall
      be retained by the Master Servicer as additional servicing compensation. In
      the
      event the Master Servicer shall deposit in the Collection Account any amount
      not
      required to be deposited therein, it may at any time withdraw such amount from
      the Collection Account, any provision herein to the contrary
      notwithstanding.

     

    (b) On
      behalf
      of the Trust Fund, the Trustee shall establish and maintain one or more accounts
      (such account or accounts, the “Distribution Account”), held in trust for the
      benefit of the Certificateholders. On behalf of the Trust Fund, the Master
      Servicer shall deliver to the Trustee in immediately available funds for deposit
      in the Distribution Account on or before 5:00 p.m. New York time on the Master
      Servicer Remittance Date, that portion of the Available Distribution Amount
      for
      the related Distribution Date then on deposit in the Collection
      Account.

     

    (c) Funds
      in
      the Collection Account and the Distribution Account may be invested in Permitted
      Investments in accordance with the provisions set forth in Section 3.12. The
      Master Servicer shall give notice to the Trustee and the Depositor of the
      location of the Collection Account maintained by it when established and prior
      to any change thereof. The Trustee shall give notice to the Master Servicer
      and
      the Depositor of the location of the Distribution Account when established
      and
      prior to any change thereof.

     

    (d) Funds
      held in the Collection Account at any time may be delivered by the Master
      Servicer to the Trustee for deposit in an account (which may be the Distribution
      Account and must satisfy the standards for the Distribution Account as set
      forth
      in the definition thereof) and for all purposes of this Agreement shall be
      deemed to be a part of the Collection Account; provided, however, that the
      Trustee shall have the sole authority to withdraw any funds held pursuant to
      this subsection (d). In the event the Master Servicer shall deliver to the
      Trustee for deposit in the Distribution Account any amount not required to
      be
      deposited therein, it may at any time request that the Trustee withdraw such
      amount from the Distribution Account and remit to it any such amount, any
      provision herein to the contrary notwithstanding. In addition, the Master
      Servicer shall deliver to the Trustee from time to time for deposit, and upon
      written notification from the Master Servicer, the Trustee shall so deposit,
      in
      the Distribution Account:

     

    (i) any
      Advances, as required pursuant to Section 4.06;

     

    (ii) any
      amounts required to be deposited pursuant to Section 3.23(d) or (f) in
      connection with any REO Property;

     

    (iii) any
      amounts to be paid by the Master Servicer in connection with a purchase of
      Mortgage Loans and REO Properties pursuant to Section 9.01;

     

    (iv) any
      amounts required to be deposited pursuant to Section 3.24 in connection with
      any
      Prepayment Interest Shortfalls; and

     

    (v) any
      Stayed Funds, as soon as permitted by the federal bankruptcy court having
      jurisdiction in such matters.

     

    (e) Promptly
      upon receipt of any Stayed Funds, whether from the Master Servicer, a trustee
      in
      bankruptcy, or federal bankruptcy court or other source, the Trustee shall
      deposit such funds in the Distribution Account.

     

    Section
      3.11 Withdrawals
      from the Collection Account and Distribution Account.

     

    (a) The
      Master Servicer shall, from time to time, make withdrawals from the Collection
      Account for any of the following purposes or as described in Section
      4.06:

     

    (i) to
      remit
      to the Trustee for deposit in the Distribution Account the amounts required
      to
      be so remitted pursuant to Section 3.10(b) or permitted to be so remitted
      pursuant to the first sentence of Section 3.10(d);

     

    (ii) subject
      to Section 3.16(d), to reimburse the Master Servicer for Advances;

     

    (iii) subject
      to Section 3.16(d), to pay the Master Servicer or any Sub-Servicer any unpaid
      Servicing Fees and reimburse any unreimbursed Servicing Advances with respect
      to
      each Mortgage Loan, but only to the extent of any Liquidation Proceeds,
      Insurance Proceeds or other amounts as may be collected by the Master
      Servicer;

     

    (iv) to
      pay to
      the Master Servicer as servicing compensation (in addition to the Servicing
      Fee)
      on the Master Servicer Remittance Date any interest or investment income earned
      on funds deposited in the Collection Account, any Foreclosure Profits and any
      prepayment penalties or premiums relating to any Principal Prepayments;
      provided, however, that no such amounts shall be payable as servicing
      compensation to the extent they relate to a Mortgage Loan with respect to which
      a default, breach, violation or event of acceleration exists or would exist
      but
      for the lapse of time, the giving of notice, or both;

     

    (v) to
      pay to
      the Master Servicer, the Depositor or a Seller, as the case may be, with respect
      to each Mortgage Loan that has previously been purchased or replaced pursuant
      to
      Section 2.03 or Section 3.16(c) all amounts received thereon subsequent to
      the
      date of purchase or substitution, as the case may be;

     

    (vi) to
      reimburse the Master Servicer for any Advance previously made which the Master
      Servicer has determined to be a Nonrecoverable Advance in accordance with the
      provisions of Section 4.06;

     

    (vii) to
      reimburse the Master Servicer or the Depositor for expenses incurred by or
      reimbursable to the Master Servicer or the Depositor, as the case may be,
      pursuant to Section 6.03;

     

    (viii) to
      reimburse the Master Servicer or the Trustee, as the case may be, for expenses
      reasonably incurred in respect of the breach or defect giving rise to the
      purchase obligation under Section 2.03 or Section 2.04 of this Agreement that
      were included in the Purchase Price of the Mortgage Loan, including any expenses
      arising out of the enforcement of the purchase obligation;

     

    (ix) to
      pay,
      or to reimburse the Master Servicer for advances in respect of, expenses
      incurred in connection with any Mortgage Loan pursuant to Section 3.16(b);
      and

     

    (x) to
      clear
      and terminate the Collection Account pursuant to Section 10.01;

     

    (xi) to
      reimburse the Master Servicer for amounts deposited in error.

     

    The
      Master Servicer shall keep and maintain separate accounting, on a Mortgage
      Loan
      by Mortgage Loan basis, for the purpose of justifying any withdrawal from the
      Collection Account, to the extent held by or on behalf of it, pursuant to
      subclauses (ii), (iii), (iv), (v), (vi), (viii) and (ix) above. The Master
      Servicer shall provide written notification to the Trustee, on or prior to
      the
      next succeeding Master Servicer Remittance Date, upon making any withdrawals
      from the Collection Account pursuant to subclause (vii) above.

     

    (b) The
      Trustee shall, from time to time, make withdrawals from the Distribution
      Account, for any of the following purposes, without priority:

     

    (i) to
      make
      distributions to Certificateholders in accordance with Section
      4.01;

     

    (ii) to
      pay to
      itself amounts to which it is entitled pursuant to Section 8.05;

     

    (iii) to
      pay
      itself any interest income earned on funds deposited in the Distribution Account
      pursuant to Section 3.12(c);

     

    (iv) to
      reimburse itself pursuant to Section 7.02 and 7.01(b);

     

    (v) to
      pay
      any amounts in respect of taxes pursuant to 10.01(g)(iii); and

     

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

     

    Section
      3.12 Investment
      of Funds in the Collection Account, Servicing Accounts and the Distribution
      Account.

     

    (a) The
      Master Servicer may direct any depository institution maintaining the Collection
      Account or Servicing Accounts (for purposes of this Section 3.12, an “Investment
      Account’), and the Trustee, in its individual capacity, may direct any
      depository institution maintaining the Distribution Account (for purposes of
      this Section 3.12, also an “Investment Account’), to invest the funds in such
      Investment Account in one or more Permitted Investments bearing interest or
      sold
      at a discount, and maturing, unless payable on demand, (i) no later than the
      Business Day immediately preceding the date on which such funds are required
      to
      be withdrawn from such account pursuant to this Agreement, if a Person other
      than the Trustee is the obligor thereon, and (ii) no later than the date on
      which such funds are required to be withdrawn from such account pursuant to
      this
      Agreement, if the Trustee is the obligor thereon. All such Permitted Investments
      shall be held to maturity, unless payable on demand. Any investment of funds
      in
      an Investment Account shall be made in the name of the Trustee (in its capacity
      as such) or in the name of a nominee of the Trustee. The Trustee shall be
      entitled to sole possession (except with respect to investment direction of
      funds held in the Collection Account or Servicing Accounts, as applicable,
      and
      any income and gain realized thereon) over each such investment, and any
      certificate or other instrument evidencing any such investment shall be
      delivered directly to the Trustee or its agent, together with any document
      of
      transfer necessary to transfer title to such investment to the Trustee or its
      nominee. In the event amounts on deposit in an Investment Account are at any
      time invested in a Permitted Investment payable on demand, the Trustee
      shall:

     

    
      	 	
              (x)

            	
              consistent
                with any notice required to be given thereunder, demand that payment
                thereon be made on the last day such Permitted Investment may otherwise
                mature hereunder in an amount equal to the lesser of (1) all amounts
                then
                payable thereunder and (2) the amount required to be withdrawn on
                such
                date; and

            

    

     

    
      	 	
              (y)

            	
              demand
                payment of all amounts due thereunder promptly upon determination
                by a
                Responsible Officer of the Trustee that such Permitted Investment
                would
                not constitute a Permitted Investment in respect of funds thereafter
                on
                deposit in the Investment Account.

            

    

     

    (b) All
      income and gain realized from the investment of funds deposited in the
      Collection Account or Servicing Accounts, as applicable, held by or on behalf
      of
      the Master Servicer, shall be for the benefit of the Master Servicer and shall
      be subject to its withdrawal in accordance with Section 3.11. The Master
      Servicer shall deposit in the Collection Account or Servicing Accounts, as
      applicable, the amount of any loss of principal incurred in respect of any
      such
      Permitted Investment made with funds in such accounts immediately upon
      realization of such loss.

     

    (c) All
      income and gain realized from the investment of funds deposited in the
      Distribution Account held by or on behalf of the Trustee, shall be for the
      benefit of the Trustee and shall be subject to its withdrawal at any time.
      The
      Trustee shall deposit in the Distribution Account, the amount of any loss of
      principal incurred in respect of any such Permitted Investment made with funds
      in such accounts immediately upon realization of such loss.

     

    (d) Except
      as
      otherwise expressly provided in this Agreement, if any default occurs in the
      making of a payment due under any Permitted Investment, or if a default occurs
      in any other performance required under any Permitted Investment, the Trustee
      may and, subject to Section 8.01 and Section 8.02(a)(v), upon the request of
      the
      Holders of Certificates representing more than 50% of the Voting Rights
      allocated to any Class of Certificates, shall take such action as may be
      appropriate to enforce such payment or performance, including the institution
      and prosecution of appropriate proceedings.

     

    Section
      3.13 Maintenance
      of the Primary Insurance Policies; Collections Thereunder.

     

    The
      Master Servicer will maintain or cause the related Sub-Servicer, if any, to
      maintain in full force and effect, if required under the Mortgage Loan Purchase
      Agreement and to the extent available, a Primary Insurance Policy conforming
      in
      all respects to the description set forth in Section 2(vii) of the Mortgage
      Loan
      Purchase Agreement with respect to each Mortgage Loan so insured as of the
      Closing Date (or, in the case of a Eligible Substitute Mortgage Loan, on the
      date of substitution). Such coverage will be maintained with respect to each
      such Mortgage Loan for so long as it is outstanding, subject to any applicable
      laws or until the related Loan-to-Value Ratio is reduced to less than or equal
      to 80% based on Mortgagor payments. The Master Servicer shall cause the premium
      for each Primary Insurance Policy to be paid on a timely basis and shall pay
      such premium out of its own funds if it is not otherwise paid. The Master
      Servicer or the related Sub-Servicer, if any, will not cancel or refuse to
      renew
      any such Primary Insurance Policy in effect on the Closing Date (or, in the
      case
      of a Eligible Substitute Mortgage Loan, on the date of substitution) that is
      required to be kept in force under this Agreement unless a replacement Primary
      Insurance Policy for such canceled or non-renewed policy is obtained from and
      maintained with an insurer.

     

    The
      Master Servicer shall not take, or permit any Sub-Servicer to take, any action
      which would result in non-coverage under any applicable Primary Insurance Policy
      of any loss which, but for the actions of the Master Servicer or Sub-Servicer,
      would have been covered thereunder. The Master Servicer will comply in the
      performance of this Agreement with all reasonable rules and requirements of
      each
      insurer under each Primary Insurance Policy. In connection with any assumption
      and modification agreement or substitution of liability agreement entered into
      or to be entered into pursuant to Section 3.15, the Master Servicer shall
      promptly notify the insurer under the related Primary Insurance Policy, if
      any,
      of such assumption in accordance with the terms of such policies and shall
      take
      all actions which may be required by such insurer as a condition to the
      continuation of coverage under the Primary Insurance Policy. If any such Primary
      Insurance Policy is terminated as a result of such assumption, the Master
      Servicer or the related Sub-Servicer shall obtain a replacement Primary
      Insurance Policy as provided above.

     

    In
      connection with its activities as administrator and servicer of the Mortgage
      Loans, the Master Servicer agrees to prepare and present, on behalf of itself,
      the Trustee and the Certificateholders, claims to the insurer under any Primary
      Insurance Policy in a timely fashion in accordance with the terms of such
      policies and, in this regard, to take such action as shall be necessary to
      permit recovery under any Primary Insurance Policy respecting a defaulted
      Mortgage Loan. Any amounts collected by the Master Servicer under any Primary
      Insurance Policy shall be deposited in the Collection Account, subject to
      withdrawal pursuant to Section 3.11; and any amounts collected by the Master
      Servicer under any Primary Insurance Policy in respect of any REO Property
      shall
      be deposited in the Collection Account, subject to withdrawal pursuant to
      Section 3.23. In those cases in which a Mortgage Loan is serviced by a
      Sub-Servicer, the Sub-Servicer, on behalf of itself, the Trustee, and the
      Certificateholders, will present claims to the insurer under any Primary
      Insurance Policy and all collections thereunder shall be deposited initially
      in
      the Sub-Servicing Account.

     

    Section
      3.14 Maintenance
      of Hazard Insurance and Errors and Omissions and Fidelity Coverage.

     

    (a) The
      Master Servicer shall cause to be maintained for each Mortgage Loan fire
      insurance with extended coverage on the related Mortgaged Property in an amount
      which is at least equal to the least of (i) the current principal balance of
      such Mortgage Loan, (ii) the amount necessary to fully compensate for any damage
      or loss to the improvements that are a part of such property on a replacement
      cost basis and (iii) the maximum insurable value of the improvements which
      are a
      part of such Mortgaged Property, in each case in an amount not less than such
      amount as is necessary to avoid the application of any coinsurance clause
      contained in the related hazard insurance policy. The Master Servicer shall
      also
      cause to be maintained fire insurance with extended coverage on each REO
      Property in an amount which is at least equal to the lesser of (i) the maximum
      insurable value of the improvements which are a part of such property and (ii)
      the outstanding principal balance of the related Mortgage Loan at the time
      it
      became an REO Property, plus accrued interest at the Loan Rate and related
      Servicing Advances. The Master Servicer will comply in the performance of this
      Agreement with all reasonable rules and requirements of each insurer under
      any
      such hazard policies. Any amounts to be collected by the Master Servicer under
      any such policies (other than amounts to be applied to the restoration or repair
      of the property subject to the related Mortgage or amounts to be released to
      the
      Mortgagor in accordance with the procedures that the Master Servicer would
      follow in servicing loans held for its own account, subject to the terms and
      conditions of the related Mortgage and Mortgage Note) shall be deposited in
      the
      Collection Account, within two Business Days after receipt thereof, subject
      to
      withdrawal pursuant to Section 3.11, if received in respect of a Mortgage Loan,
      or in the REO Account, subject to withdrawal pursuant to Section 3.23, if
      received in respect of an REO Property. Any cost incurred by the Master Servicer
      in maintaining any such insurance shall not, for the purpose of calculating
      distributions to Certificateholders, be added to the unpaid principal balance
      of
      the related Mortgage Loan, notwithstanding that the terms of such Mortgage
      Loan
      so permit. It is understood and agreed that no earthquake, windstorm or other
      additional insurance is to be required of any Mortgagor other than pursuant
      to
      such applicable laws and regulations as shall at any time be in force and as
      shall require such additional insurance. If the Mortgaged Property or REO
      Property is at any time in an area identified in the Federal Register by the
      Federal Emergency Management Agency as having special flood hazards, the Master
      Servicer will cause to be maintained a flood insurance policy in respect
      thereof. Such flood insurance shall be in an amount equal to the lesser of
      (i)
      the unpaid principal balance of the related Mortgage Loan and (ii) the maximum
      amount of such insurance available for the related Mortgaged Property under
      the
      national flood insurance program (assuming that the area in which such Mortgaged
      Property is located is participating in such program).

     

    If
      the
      Master Servicer shall obtain and maintain a blanket fire insurance policy with
      extended coverage insuring against hazard losses on all of the Mortgage Loans,
      it shall conclusively be deemed to have satisfied its obligations as set forth
      in the first two sentences of this Section 3.14, it being understood and agreed
      that such policy may contain a deductible clause, in which case the Master
      Servicer shall, in the event that there shall not have been maintained on the
      related Mortgaged Property or REO Property a policy complying with the first
      two
      sentences of this Section 3.14, and there shall have been one or more losses
      which would have been covered by such policy, deposit to the Collection Account
      from its own funds the amount not otherwise payable under the blanket policy
      because of such deductible clause. In connection with its activities as
      administrator and servicer of the Mortgage Loans, the Master Servicer agrees
      to
      prepare and present, on behalf of itself, the Trustee and Certificateholders,
      claims under any such blanket policy in a timely fashion in accordance with
      the
      terms of such policy.

     

    (b) The
      Master Servicer shall keep in force during the term of this Agreement a policy
      or policies of insurance covering errors and omissions for failure in the
      performance of the Master Servicer’s obligations under this Agreement, which
      policy or policies shall be in such form and amount that would meet the
      requirements of Fannie Mae or Freddie Mac if it were the purchaser of the
      Mortgage Loans, unless the Master Servicer has obtained a waiver of such
      requirements from Fannie Mae or Freddie Mac. The Master Servicer shall also
      maintain a fidelity bond in the form and amount that would meet the requirements
      of Fannie Mae or Freddie Mac, unless the Master Servicer has obtained a waiver
      of such requirements from Fannie Mae or Freddie Mac. The Master Servicer shall
      provide the Trustee (upon the Trustee’s reasonable request) with copies of any
      such insurance policies and fidelity bond. The Master Servicer shall be deemed
      to have complied with this provision if an Affiliate of the Master Servicer
      has
      such errors and omissions and fidelity bond coverage and, by the terms of such
      insurance policy or fidelity bond, the coverage afforded thereunder extends
      to
      the Master Servicer. Any such errors and omissions policy and fidelity bond
      shall by its terms not be cancelable without thirty days’ prior written notice
      to the Trustee. The Master Servicer shall also cause each Sub-Servicer to
      maintain a policy of insurance covering errors and omissions and a fidelity
      bond
      which would meet such requirements.

     

    Section
      3.15 Enforcement
      of Due-On-Sale Clauses; Assumption Agreements.

     

    The
      Master Servicer will, to the extent it has knowledge of any conveyance or
      prospective conveyance of any Mortgaged Property by any Mortgagor (whether
      by
      absolute conveyance or by contract of sale, and whether or not the Mortgagor
      remains or is to remain liable under the Mortgage Note and/or the Mortgage),
      exercise its rights to accelerate the maturity of such Mortgage Loan under
      the
“due-on-sale” clause, if any, applicable thereto; provided, however, that the
      Master Servicer shall not exercise any such rights if prohibited by law from
      doing so or if the exercise of such rights would impair or threaten to impair
      any recovery under the related Primary Insurance Policy or Limited Purpose
      Surety Bond, if any. If the Master Servicer reasonably believes it is unable
      under applicable law to enforce such “due-on-sale” clause, or if any of the
      other conditions set forth in the proviso to the preceding sentence apply,
      the
      Master Servicer will enter into an assumption and modification agreement from
      or
      with the person to whom such property has been conveyed or is proposed to be
      conveyed, pursuant to which such person becomes liable under the Mortgage Note
      and, to the extent permitted by applicable state law, the Mortgagor remains
      liable thereon. The Master Servicer is also authorized to enter into a
      substitution of liability agreement with such person, pursuant to which the
      original Mortgagor is released from liability and such person is substituted
      as
      the Mortgagor and becomes liable under the Mortgage Note, provided that no
      such
      substitution shall be effective unless such person satisfies the underwriting
      criteria of the Master Servicer and has a credit risk rating at least equal
      to
      that of the original Mortgagor. In connection with any assumption or
      substitution, the Master Servicer shall apply such underwriting standards and
      follow such practices and procedures as shall be normal and usual in its general
      mortgage servicing activities and as it applies to other mortgage loans owned
      solely by it. The Master Servicer shall not take or enter into any assumption
      and modification agreement, however, unless (to the extent practicable in the
      circumstances) it shall have received confirmation, in writing, of the continued
      effectiveness of any applicable Primary Insurance Policy or hazard insurance
      policy, or a new policy meeting the requirements of this Section is obtained.
      Any fee collected by the Master Servicer in respect of an assumption or
      substitution of liability agreement will be retained by the Master Servicer
      as
      additional servicing compensation. In connection with any such assumption,
      no
      material term of the Mortgage Note (including but not limited to the related
      Loan Rate and the amount of the Monthly Payment) may be amended or modified,
      except as otherwise required pursuant to the terms thereof. The Master Servicer
      shall notify the Trustee that any such substitution or assumption agreement
      has
      been completed by forwarding to the Trustee the executed original of such
      substitution or assumption agreement, which document shall be added to the
      related Mortgage File and shall, for all purposes, be considered a part of
      such
      Mortgage File to the same extent as all other documents and instruments
      constituting a part thereof.

     

    Notwithstanding
      the foregoing paragraph or any other provision of this Agreement, the Master
      Servicer shall not be deemed to be in default, breach or any other violation
      of
      its obligations hereunder by reason of any assumption of a Mortgage Loan by
      operation of law or by the terms of the Mortgage Note or any assumption which
      the Master Servicer may be restricted by law from preventing, for any reason
      whatever. For purposes of this Section 3.15, the term “assumption” is deemed to
      also include a sale (of the Mortgaged Property) subject to the Mortgage that
      is
      not accompanied by an assumption or substitution of liability
      agreement.

     

    Section
      3.16 Realization
      Upon Defaulted Mortgage Loans.

     

    (a) The
      Master Servicer shall, consistent with the servicing standard set forth in
      Section 3.01, foreclose upon or otherwise comparably convert the ownership
      of
      properties securing such of the Mortgage Loans as come into and continue in
      default and as to which no satisfactory arrangements can be made for collection
      of delinquent payments pursuant to Section 3.07. The Master Servicer shall
      be
      responsible for all costs and expenses incurred by it in any such proceedings;
      provided, however, that such costs and expenses will be recoverable as Servicing
      Advances by the Master Servicer as contemplated in Section 3.11 and Section
      3.23. The foregoing is subject to the provision that, in any case in which
      Mortgaged Property shall have suffered damage from an Uninsured Cause, the
      Master Servicer shall not be required to expend its own funds toward the
      restoration of such property unless it shall determine in its discretion that
      such restoration will increase the proceeds of liquidation of the related
      Mortgage Loan after reimbursement to itself for such expenses.

     

    (b) Notwithstanding
      the foregoing provisions of this Section 3.16 or any other provision of this
      Agreement, with respect to any Mortgage Loan as to which the Master Servicer
      has
      received actual notice of, or has actual knowledge of, the presence of any
      toxic
      or hazardous substance on the related Mortgaged Property, the Master Servicer
      shall not, on behalf of the Trustee, either (i) obtain title to such Mortgaged
      Property as a result of or in lieu of foreclosure or otherwise, or (ii)
      otherwise acquire possession of, or take any other action with respect to,
      such
      Mortgaged Property, if, as a result of any such action, the Trustee, the Trust
      Fund or the Certificateholders would be considered to hold title to, to be
      a
“mortgagee-in-possession” of, or to be an “owner” or “operator” of such
      Mortgaged Property within the meaning of the Comprehensive Environmental
      Response, Compensation and Liability Act of 1980, as amended from time to time,
      or any comparable law, unless the Master Servicer has also previously
      determined, based on its reasonable judgment and a report prepared by a Person
      who regularly conducts environmental audits using customary industry standards,
      that:

     

    (1) such
      Mortgaged Property is in compliance with applicable environmental laws or,
      if
      not, that it would be in the best economic interest of the Trust Fund to take
      such actions as are necessary to bring the Mortgaged Property into compliance
      therewith; and

     

    (2) there
      are
      no circumstances present at such Mortgaged Property relating to the use,
      management or disposal of any hazardous substances, hazardous materials,
      hazardous wastes, or petroleum-based materials for which investigation, testing,
      monitoring, containment, clean-up or remediation could be required under any
      federal, state or local law or regulation, or that if any such materials are
      present for which such action could be required, that it would be in the best
      economic interest of the Trust Fund to take such actions with respect to the
      affected Mortgaged Property.

     

    The
      cost
      of the environmental audit report contemplated by this Section 3.23 shall be
      advanced by the Master Servicer, subject to the Master Servicer’s right to be
      reimbursed therefor from the Collection Account as provided in Section
      3.11(a)(ix), such right of reimbursement being prior to the rights of
      Certificateholders to receive any amount in the Collection Account received
      in
      respect of the affected Mortgage Loan or other Mortgage Loans.

     

    If
      the
      Master Servicer determines, as described above, that it is in the best economic
      interest of the Trust Fund to take such actions as are necessary to bring any
      such Mortgaged Property into compliance with applicable environmental laws,
      or
      to take such action with respect to the containment, clean-up or remediation
      of
      hazardous substances, hazardous materials, hazardous wastes or petroleum based
      materials affecting any such Mortgaged Property, then the Master Servicer shall
      take such action as it deems to be in the best economic interest of the Trust
      Fund. The cost of any such compliance, containment, cleanup or remediation
      shall
      be advanced by the Master Servicer, subject to the Master Servicer’s right to be
      reimbursed therefor from the Collection Account as provided in Section
      3.11(a)(ix), such right of reimbursement being prior to the rights of
      Certificateholders to receive any amount in the Collection Account received
      in
      respect of the affected Mortgage Loan or other Mortgage Loans.

     

    (c) The
      Master Servicer may at its option purchase from the Trust Fund any Mortgage
      Loan
      that is 90 days or more Delinquent, which the Master Servicer determines in
      good
      faith will otherwise become subject to foreclosure proceedings (evidence of
      such
      determination to be delivered in writing to the Trustee prior to purchase),
      at a
      price equal to the sum of the outstanding Stated Principal Balance of such
      Mortgage Loan and accrued and unpaid interest thereon at the Loan Rate through
      the end of the Due Period preceding the last Distribution Date, less
      unreimbursed Servicing Advances, Advances and any unpaid Servicing Fees
      allocable to such Mortgage Loan. The purchase price for any Mortgage Loan
      purchased hereunder shall be deposited in the Collection Account, and the
      Trustee, upon receipt of written certification from the Master Servicer of
      such
      deposit, shall release or cause to be released to the Master Servicer the
      related Mortgage File and shall execute and deliver such instruments of transfer
      or assignment, in each case without recourse, as the Master Servicer shall
      furnish and as shall be necessary to vest in the Master Servicer title to any
      Mortgage Loan released pursuant hereto.

     

    (d) Proceeds
      received in connection with any Final Recovery Determination, as well as any
      recovery resulting from a partial collection of Insurance Proceeds or
      Liquidation Proceeds, in respect of any Mortgage Loan, will be applied in the
      following order of priority: first, to reimburse the Master Servicer or any
      Sub-Servicer for any related unreimbursed Servicing Advances and Advances,
      pursuant to Section 3.11(a)(ii) or (a)(iii); second, to accrued and unpaid
      interest on the Mortgage Loan, to the date of the Final Recovery Determination,
      or to the Due Date prior to the Distribution Date on which such amounts are
      to
      be distributed if not in connection with a Final Recovery Determination; third,
      as a recovery of principal of the Mortgage Loan; and fourth, to Foreclosure
      Profits. If the amount of the recovery so allocated to interest is less than
      the
      full amount of accrued and unpaid interest due on such Mortgage Loan, the amount
      of such recovery will be allocated by the Master Servicer as follows: first, to
      unpaid Servicing Fees; and second, to the balance of the interest then due
      and
      owing. The portion of the recovery so allocated to unpaid Servicing Fees shall
      be reimbursed to the Master Servicer or any Sub-Servicer pursuant to Section
      3.11(a)(iii).

     

    (e) In
      addition to the foregoing, the Trustee, as assignee of the Pledged Asset
      Servicing Agreement, shall enforce the obligations of the Pledged Asset Servicer
      to use its best reasonable efforts to realize upon any Pledged Assets for such
      of the Pledged Asset Loans as come into and continue in default and as to which
      no satisfactory arrangements can be made for collection of delinquent payments
      pursuant to Section 3.11; provided that pursuant to the Pledged Asset Servicing
      Agreement, the Pledged Asset Servicer shall not, on behalf of the Trustee,
      obtain title to any such Pledged Assets as a result of or in lieu of the
      disposition thereof or otherwise; and provided further that (i) the Pledged
      Asset Servicer, pursuant to the Pledged Asset Servicing Agreement, shall not
      proceed with respect to such Pledged Assets in any manner that would impair
      the
      ability to recover against the related Mortgaged Property, and (ii) the Master
      Servicer shall proceed with any acquisition of REO Property in a manner that
      preserves the ability to apply the proceeds of such Pledged Assets against
      amounts owed under the defaulted Mortgage Loan. Any proceeds realized from
      such
      Pledged Assets (other than amounts to be released to the Mortgagor or the
      related guarantor in accordance with procedures that the Master Servicer would
      follow in servicing loans held for its own account, subject to the terms and
      conditions of the related Mortgage and Mortgage Note and to the terms and
      conditions of any security agreement, guarantee agreement, mortgage or other
      agreement governing the disposition of the proceeds of such Pledged Assets)
      shall be deposited in the Distribution Account, subject to withdrawal pursuant
      to Section 3.11; provided, that such proceeds shall not be so deposited if
      the
      Required Surety Payment in respect of such Pledged Asset Loan has been deposited
      in the Collection Account (except to the extent of any such proceeds taken
      into
      account in calculating the amount of the Required Surety Payment). Any other
      payment received by a Seller in respect of such Pledged Assets shall be
      deposited in the Distribution Account subject to withdrawal pursuant to Section
      3.11.

     

    Section
      3.17 Trustee
      to Cooperate; Release of Mortgage Files.

     

    (a) Upon
      the
      payment in full of any Mortgage Loan, or the receipt by the Master Servicer
      of a
      notification that payment in full shall be escrowed in a manner customary for
      such purposes, the Master Servicer will immediately notify the Trustee by
      delivering a certification in duplicate (one of which will be returned to the
      Master Servicer with the Mortgage File) in the form of Exhibit E which shall
      be
      signed by a Servicing Officer or in a mutually agreeable electronic format
      which
      will in lieu of a signature be deemed to originate from a Servicing Officer
      (which certification shall include a statement to the effect that all amounts
      received or to be received in connection with such payment which are required
      to
      be deposited in the Collection Account pursuant to Section 3.10 have been or
      will be so deposited) of a Servicing Officer and shall request delivery to
      it of
      the Mortgage File. Upon receipt of such certification and request, the Trustee
      shall promptly release the related Mortgage File to the Master Servicer. No
      expenses incurred in connection with any instrument of satisfaction or deed
      of
      reconveyance shall be chargeable to the Collection Account or the Distribution
      Account.

     

    (b) From
      time
      to time and as appropriate for the servicing or foreclosure of any Mortgage
      Loan, including, for this purpose, collection under any Primary Insurance Policy
      or any other insurance policy relating to the Mortgage Loans, the Trustee shall,
      upon request of the Master Servicer and delivery to the Trustee in duplicate
      (one of which will be returned to the Master Servicer with the Mortgage File)
      of
      a Request for Release in the form of Exhibit E, which shall be signed by a
      Servicing Officer or in a mutually agreeable electronic format which will in
      lieu of a signature be deemed to originate from a Servicing Officer release
      the
      related Mortgage File to the Master Servicer, and the Trustee shall, at the
      direction of the Master Servicer, and in the form provided by the Master
      Servicer execute such documents as shall be necessary to the prosecution of
      any
      such proceedings. Such Request for Release shall obligate the Master Servicer
      to
      return each and every document previously requested from the Mortgage File
      to
      the Trustee when the need therefor by the Master Servicer no longer exists,
      unless the Mortgage Loan has been liquidated and the Liquidation Proceeds
      relating to the Mortgage Loan have been deposited in the Collection Account
      or
      the Mortgage File or such document has been delivered to an attorney, or to
      a
      public trustee or other public official as required by law, for purposes of
      initiating or pursuing legal action or other proceedings for the foreclosure
      of
      the Mortgaged Property either judicially or non-judicially, and the Master
      Servicer has delivered to the Trustee a certificate of a Servicing Officer
      certifying as to the name and address of the Person to which such Mortgage
      File
      or such document was delivered and the purpose or purposes of such delivery.
      Upon receipt of a certificate of a Servicing Officer stating that such Mortgage
      Loan was liquidated and that all amounts received or to be received in
      connection with such liquidation that are required to be deposited into the
      Collection Account have been so deposited, or that such Mortgage Loan has become
      an REO Property, the Master Servicer shall no longer be obligated to return
      the
      documents released by the Trustee pursuant to the related Request for Release
      and a copy of the Request for Release shall be released by the Trustee to the
      Master Servicer.

     

    (c) Upon
      written certification of a Servicing Officer, the Trustee shall execute and
      deliver to the Master Servicer any court pleadings, requests for trustee’s sale
      or other documents reasonably necessary to the foreclosure or trustee’s sale in
      respect of a Mortgaged Property or to any legal action brought to obtain
      judgment against any Mortgagor on the Mortgage Note or Mortgage or to obtain
      a
      deficiency judgment, or to enforce any other remedies or rights provided by
      the
      Mortgage Note or Mortgage or otherwise available at law or inequity. Each such
      certification shall include a request that such pleadings or documents be
      executed by the Trustee and a statement as to the reason such documents or
      pleadings are required and that the execution and delivery thereof by the
      Trustee will not invalidate or otherwise affect the lien of the Mortgage, except
      for the termination of such a lien upon completion of the foreclosure or
      trustee’s sale.

     

    Section
      3.18 Servicing
      Compensation.

     

    As
      compensation for the activities of the Master Servicer hereunder, the Master
      Servicer shall be entitled to the Servicing Fee with respect to each Mortgage
      Loan payable solely from payments of interest and Buydown Funds in respect
      of
      such Mortgage Loan, subject to Section 3.24. In addition, the Master Servicer
      shall be entitled to recover unpaid Servicing Fees out of Insurance Proceeds
      or
      Liquidation Proceeds to the extent permitted by Section 3.11(a)(iii) and out
      of
      amounts derived from the operation and sale of an REO Property to the extent
      permitted by Section 3.23. The right to receive the Servicing Fee may not be
      transferred in whole or in part except in connection with the transfer of all
      of
      the Master Servicer’s responsibilities and obligations under this Agreement. In
      the event that Liquidation Proceeds, Insurance Proceeds and proceeds from any
      REO Disposition (net of amounts reimbursable therefrom pursuant to Section
      3.11(a)(iii)) in respect of a Cash Liquidation or REO Disposition exceed the
      unpaid principal balance of such Mortgage Loan plus unpaid interest accrued
      thereon (including REO Imputed Interest) at a per annum rate equal to the
      related Net Mortgage Rate, the Master Servicer shall be entitled to retain
      therefrom and to pay to itself any Foreclosure Profits and any Servicing Fee
      considered to be accrued but unpaid.

     

    Additional
      servicing compensation in the form of assumption fees, late payment charges
      and
      other similar fees and charges shall be retained by the Master Servicer (subject
      to Section 3.24) only to the extent such fees or charges are received by the
      Master Servicer. The Master Servicer shall also be entitled pursuant to Section
      3.11(a)(iv) to withdraw from the Collection Account, and pursuant to Section
      3.23(b) to withdraw from any REO Account, as additional servicing compensation,
      interest or other income earned on deposits therein, subject to Section 3.12
      and
      Section 3.24. The Master Servicer shall be required to pay all expenses incurred
      by it in connection with its servicing activities hereunder (including premiums
      for the insurance required by Section 3.14, to the extent such premiums are
      not
      paid by the related Mortgagors or by a Sub-Servicer, servicing compensation
      of
      each Sub-Servicer, and to the extent provided herein in Section 8.05, the fees
      and expenses of the Trustee) and shall not be entitled to reimbursement therefor
      except as specifically provided herein.

     

    Section
      3.19 Reports
      to the Trustee; Collection Account Statements.

     

    Upon
      request from the Trustee, the Master Servicer shall forward to the Trustee
      and
      the Depositor a statement prepared by the Master Servicer setting forth the
      status of the Collection Account as of the close of business on such
      Distribution Date and showing, for the period covered by such statement, the
      aggregate amount of deposits into and withdrawals from the Collection Account
      of
      each category of deposit specified in Section 3.10(a) and each category of
      withdrawal specified in Section 3.11. Such statement may be in the form of
      the
      then current Fannie Mae Monthly Accounting Report for its Guaranteed Mortgage
      Pass-Through Program with appropriate additions and changes, and shall also
      include information as to the aggregate of the outstanding principal balances
      of
      all of the Mortgage Loans as of the last day of the calendar month immediately
      preceding such Distribution Date. Copies of such statement shall be provided
      by
      the Trustee to any Certificateholder and to any Person identified to the Trustee
      as a prospective transferee of a Certificate, upon request at the expense of
      the
      requesting party, provided such statement is delivered by the Master Servicer
      to
      the Trustee.

     

    Section
      3.20 Annual
      Statement as to Compliance.

     

    The
      Master Servicer will deliver to the Trustee and the Depositor, not later than
      February 28 of each calendar year beginning in 2007 (and
      no
      later than April 15 of any calendar year in which the Trust Fund is no longer
      subject to the Exchange Act reporting requirements),
      an
      Officers’ Certificate (an “Annual Statement of Compliance”) stating, as to each
      signatory thereof, that (i) a review of the activities of the Master Servicer
      during the preceding calendar year and of performance under this Agreement
      has
      been made under such officers’ supervision and (ii) to the best of such
      officers’ knowledge, based on such review, the Master Servicer has fulfilled all
      of its obligations under this Agreement or other applicable servicing agreement
      in all material respects throughout such year, or, if there has been a failure
      to fulfill any such obligation in any material respect, specifying each such
      failure known to such officer and the nature and status thereof. Such Annual
      Statement of Compliance shall contain no restrictions or limitations on its
      use.
      In the event that the Master Servicer has delegated any servicing
      responsibilities with respect to the Mortgage Loans to a Sub-Servicer, the
      Master Servicer shall deliver a similar Annual Statement of Compliance by that
      Sub-Servicer to the Trustee and Depositor as described above as and when
      required with respect to the Master Servicer.

     

    If
      the
      Master Servicer cannot deliver the related Annual Statement of Compliance by
      February 28th of such year, the Trustee, at its sole option, may permit a cure
      period for the Master Servicer to deliver such Annual Statement of Compliance,
      but in no event later than March 10th of such year.

     

    Section
      3.21 Assessments
      of Compliance and Attestation Reports.

     

    Pursuant
      to Rules 13a-18 and 15d-18 of the Exchange Act and Item 1123 of Regulation
      AB,
      the Master Servicer shall deliver to the Trustee on or before February 28 of
      each calendar year beginning in 2007 (and no later than April 15 of any calendar
      year in which the Trust Fund is no longer subject to the Exchange Act reporting
      requirements), a report regarding the Master Servicer’s assessment of compliance
      (an “Assessment of Compliance”) with the Servicing Criteria during the preceding
      calendar year. The Assessment of Compliance must be as set forth in Regulation
      AB, the Assessment of Compliance must contain the following:

     

    (a) A
      statement by such officer of its responsibility for assessing compliance with
      the Servicing Criteria applicable to the Master Servicer;

     

    (b) A
      statement by such officer that such officer used the Servicing Criteria attached
      as Exhibit O hereto, and which will also be attached to the Assement of
      Compliance, to assess compliance with the Servicing Criteria applicable to
      the
      Master Servicer;

     

    (c) An
      assessment by such officer of the Master Servicer’s compliance with the
      applicable Servicing Criteria for the period consisting of the preceding
      calendar year, including disclosure of any material instance of noncompliance
      with respect thereto during such period, which assessment shall be based on
      the
      activities it performs with respect to asset-backed securities transactions
      taken as a whole involving the Master Servicer, that are backed by the same
      asset type as the Mortgage Loans;

     

    (d) A
      statement that a registered public accounting firm has issued an attestation
      report on the Master Servicer’s Assessment of Compliance for the period
      consisting of the preceding calendar year; and

     

    (e) A
      statement as to which of the Servicing Criteria, if any, are not applicable
      to
      the Master Servicer, which statement shall be based on the activities it
      performs with respect to asset-backed securities transactions taken as a whole
      involving the Master Servicer, that are backed by the same asset type as the
      Mortgage Loans.

     

    Such
      report at a minimum shall address each of the Servicing Criteria specified
      on
      Exhibit O hereto which are indicated as applicable to the Master
      Servicer.

     

    On
      or
      before February 28 of each calendar year beginning in 2007 (and no later than
      April 15 of any calendar year in which the Trust Fund is no longer subject
      to
      the Exchange Act reporting requirements), the Master Servicer shall furnish
      to
      the Trustee a report (an “Attestation Report”) by a registered public accounting
      firm that attests to, and reports on, the Assessment of Compliance made by
      the
      Company, as required by Rules 13a-18 and 15d-18 of the Exchange Act and Item
      1122(b) of Regulation AB, which Attestation Report must be made in accordance
      with standards for attestation reports issued or adopted by the Public Company
      Accounting Oversight Board. 

     

    The
      Master Servicer shall cause any Sub-Servicer, and each subcontractor determined
      by the Master Servicer to be “participating in the servicing function” within
      the meaning of Item 1122 of Regulation AB, to deliver to the Trustee and the
      Depositor an Assessment of Compliance and Attestation Report as and when
      provided above.

     

    Such
      Assessment of Compliance, as to any Sub-Servicer, shall at a minimum address
      each of the Servicing Criteria specified on Exhibit O hereto which are indicated
      as applicable to any “primary servicer” to the extent they are applicable to
      such Sub-servicer. Notwithstanding the foregoing, as to any subcontractor,
      an
      Assessment of Compliance is not required to be delivered unless it is required
      as part of a Form 10-K with respect to the Trust Fund.

     

    If
      the
      Master Servicer cannot deliver any Assessment of Compliance or Attestation
      Report by February 28th of such year, the Trustee, at its sole option, may
      permit a cure period for the Master Servicer to deliver such Assessment of
      Compliance or Attestation Report, but in no event later than March 10th of
      such
      year.

     

    On
      or
      before March 15th
      of each
      calendar year (unless a Form 15 Suspension Notice shall have been filed), the
      Trustee shall provide an Assessment of Compliance and Attestation Report, as
      and
      when provided above, which shall at a minimum address each of the Servicing
      Criteria specified on Exhibit O hereto which are indicated as applicable to
      the
“trustee.” The Trustee shall cause any subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
      Regulation AB to deliver to the Depositor an Assessment of Compliance and
      Attestation Report as and when provided above. 

     

    For
      as
      long as the Depositor is subject to Exchange Act reporting with respect to
      the
      Trust Fund, the Trustee shall notify the Depositor and the Master Servicer
      within three (3) Business Days of the related Distribution Date (i) of any
      legal
      proceedings pending against the Trustee of the type described in Item 1117
      (§
229.1117) of Regulation AB and (ii) if the Trustee shall become (but only to
      the
      extent not previously disclosed) at any time an affiliate of any of the parties
      listed on Exhibit Q hereto, together with a description thereof. Should the
      identification of any of the parties set forth on Exhibit Q change, the
      Depositor shall promptly notify the Trustee.

     

    Section
      3.22 Access
      to
      Certain Documentation.

     

    The
      Master Servicer shall provide to the Office of Thrift Supervision, the FDIC,
      and
      any other federal or state banking or insurance regulatory authority that may
      exercise authority over any Certificateholder, access to the documentation
      regarding the Mortgage Loans required by applicable laws and regulations. Such
      access shall be afforded without charge, but only upon reasonable request and
      during normal business hours at the offices of the Master Servicer designated
      by
      it. In addition, access to the documentation regarding the Mortgage Loans will
      be provided to any Certificateholder, the Trustee and to any Person identified
      to the Master Servicer as a prospective transferee of a Certificate, upon
      reasonable request during normal business hours at the offices of the Master
      Servicer designated by it at the expense of the Person requesting such
      access.

     

    Section
      3.23 Title,
      Management and Disposition of REO Property.

     

    (a) The
      deed
      or certificate of sale of any REO Property shall be taken in the name of the
      Trustee, or its nominee, in trust for the benefit of the Certificateholders.
      The
      Master Servicer, on behalf of the Trust Fund, shall either sell any REO Property
      within three years after the end of the calendar year in which the Trust Fund
      acquires ownership of such REO Property for purposes of Section 860G(a)(8)
      of
      the Code or request from the Internal Revenue Service, no later than 60 days
      before the day on which the three-year grace period would otherwise expire,
      an
      extension of the three-year grace period, unless the Master Servicer shall
      have
      delivered to the Trustee and the Depositor an Opinion of Counsel, addressed
      to
      the Trustee and the Depositor, to the effect that the holding by the Trust
      Fund
      of such REO Property subsequent to the three-year grace period after its
      acquisition will not result in the imposition on the Trust Fund of taxes on
      “prohibited transactions” thereof, as defined in Section 860F of the Code, or
      cause the Trust Fund to fail to qualify as a REMIC under Federal law at any
      time
      that any Certificates are outstanding. The Master Servicer shall manage,
      conserve, protect and operate each REO Property for the Certificateholders
      solely for the purpose of its prompt disposition and sale in a manner which
      does
      not cause such REO Property to fail to qualify as “foreclosure property” within
      the meaning of Section 860G(a)(8) of the Code or result in the receipt by the
      Trust Fund of any “income from non-permitted assets” within the meaning of
      Section 860F(a)(2)(B) of the Code, or any “net income from foreclosure property”
which is subject to taxation under the REMIC Provisions.

     

    (b) The
      Master Servicer shall segregate and hold all funds collected and received in
      connection with the operation of any REO Property separate and apart from its
      own funds and general assets and shall establish and maintain with respect
      to
      REO Properties an account held in trust for the Trustee for the benefit of
      the
      Certificateholders (the “REO Account”), which shall be an Eligible Account. The
      Master Servicer shall be permitted to allow the Collection Account to serve
      as
      the REO Account, subject to separate ledgers for each REO Property. The Master
      Servicer shall be entitled to retain or withdraw any interest income paid on
      funds deposited in the REO Account.

     

    (c) The
      Master Servicer shall have full power and authority, subject only to the
      specific requirements and prohibitions of this Agreement, to do any and all
      things in connection with any REO Property as are consistent with the manner
      in
      which the Master Servicer manages and operates similar property owned by the
      Master Servicer or any of its Affiliates, all on such terms and for such period
      as the Master Servicer deems to be in the best interests of Certificateholders.
      In connection therewith, the Master Servicer shall deposit, or cause to be
      deposited in the clearing account (which account must be an Eligible Account)
      in
      which it customarily deposits payments and collections on mortgage loans in
      connection with its mortgage loan servicing activities on a daily basis, and
      in
      no event more than one Business Day after the Master Servicer’s receipt thereof,
      and shall thereafter deposit in the REO Account, in no event more than two
      Business Days after the deposit of such funds into the clearing account, all
      revenues received by it with respect to an REO Property and shall withdraw
      therefrom funds necessary for the proper operation, management and maintenance
      of such REO Property including, without limitation:

     

    (i) all
      insurance premiums due and payable in respect of such REO Property;

     

    (ii) all
      real
      estate taxes and assessments in respect of such REO Property that may result
      in
      the imposition of a lien thereon; and

     

    (iii) all
      costs
      and expenses necessary to maintain such REO Property.

     

    To
      the
      extent that amounts on deposit in the REO Account with respect to an REO
      Property are insufficient for the purposes set forth in clauses (i) through
      (iii) above with respect to such REO Property, the Master Servicer shall advance
      from its own funds such amount as is necessary for such purposes if, but only
      if, the Master Servicer would make such advances if the Master Servicer owned
      the REO Property and if in the Master Servicer’s judgment, the payment of such
      amounts will be recoverable from the rental or sale of the REO
      Property.

     

    Notwithstanding
      the foregoing, neither the Master Servicer nor the Trustee shall:

     

    (i) authorize
      the Trust Fund to enter into, renew or extend any New Lease with respect to
      any
      REO Property, if the New Lease by its terms will give rise to any income that
      does not constitute Rents from Real Property;

     

    (ii) authorize
      any amount to be received or accrued under any New Lease other than amounts
      that
      will constitute Rents from Real Property;

     

    (iii) authorize
      any construction on any REO Property, other than the completion of a building
      or
      other improvement thereon, and then only if more than ten percent of the
      construction of such building or other improvement was completed before default
      on the related Mortgage Loan became imminent, all within the meaning of Section
      856(e)(4)(B) of the Code; or

     

    (iv) authorize
      any Person to Directly Operate any REO Property on any date more than 90 days
      after its date of acquisition by the Trust Fund;

     

    unless,
      in any such case, the Master Servicer has obtained an Opinion of Counsel,
      provided to the Trustee, to the effect that such action will not cause such
      REO
      Property to fail to qualify as “foreclosure property” within the meaning of
      Section 860G(a)(8) of the Code at any time that it is held by the Trust Fund,
      in
      which case the Master Servicer may take such actions as are specified in such
      Opinion of Counsel.

     

    The
      Master Servicer may contract with any Independent Contractor for the operation
      and management of any REO Property, provided that:

     

    (i) the
      terms
      and conditions of any such contract shall not be inconsistent
      herewith;

     

    (ii) any
      such
      contract shall require, or shall be administered to require, that the
      Independent Contractor pay all costs and expenses incurred in connection with
      the operation and management of such REO Property, including those listed above
      and remit all related revenues (net of such costs and expenses) to the Master
      Servicer as soon as practicable, but in no event later than thirty days
      following the receipt thereof by such Independent Contractor;

     

    (iii) none
      of
      the provisions of this Section 3.23(c) relating to any such contract or to
      actions taken through any such Independent Contractor shall be deemed to relieve
      the Master Servicer of any of its duties and obligations to the Trustee on
      behalf of the Certificateholders with respect to the operation and management
      of
      any such REO Property; and

     

    (iv) the
      Master Servicer shall be obligated with respect thereto to the same extent
      as if
      it alone were performing all duties and obligations in connection with the
      operation and management of such REO Property.

     

    The
      Master Servicer shall be entitled to enter into any agreement with any
      Independent Contractor performing services for it related to its duties and
      obligations hereunder for indemnification of the Master Servicer by such
      Independent Contractor, and nothing in this Agreement shall be deemed to limit
      or modify such indemnification. The Master Servicer shall be solely liable
      for
      all fees owed by it to any such Independent Contractor, irrespective of whether
      the Master Servicer’s compensation pursuant to Section 3.18 is sufficient to pay
      such fees; provided that the fees of any Independent Contractor engaged to
      manage, dispose, conserve and protect any REO Property shall be reimbursable
      as
      a Servicing Advance out of the proceeds of the related Mortgage Loan in
      accordance with Section 3.11(a)(iii).

     

    (d) In
      addition to the withdrawals permitted under Section 3.23(c), the Master Servicer
      may from time to time make withdrawals from the REO Account for any REO
      Property: (i) to pay itself or any Sub-Servicer unpaid Servicing Fees in respect
      of the related Mortgage Loan; and (ii) to reimburse itself or any Sub-Servicer
      for unreimbursed Servicing Advances and Advances made in respect of such REO
      Property or the related Mortgage Loan. On the Master Servicer Remittance Date,
      the Master Servicer shall withdraw from each REO Account maintained by it and
      deposit into the Distribution Account in accordance with Section 3.10(d)(ii),
      far distribution on the related Distribution Date in accordance with Section
      4.01, the income from the related REO Property received during the prior
      calendar month, net of any withdrawals made pursuant to Section 3.23(c) or
      this
      Section 3.23(d).

     

    (e) Subject
      to the time constraints set forth in Section 3.23(a), and further subject to
      obtaining the approval of the insurer under any related Primary Insurance Policy
      (if and to the extent that such approvals are necessary to make claims under
      such policies in respect of the affected REO Property), each REO Disposition
      shall be carried out by the Master Servicer at such price and upon such terms
      and conditions as the Master Servicer shall deem necessary or advisable, as
      shall be normal and usual in its general servicing activities for similar
      properties.

     

    (f) The
      proceeds from the REO Disposition, net of any amount required by law to be
      remitted to the Mortgagor under the related Mortgage Loan and net of any payment
      or reimbursement to the Master Servicer or any Sub-Servicer as provided above
      including fees paid by the Master Servicer to any such Independent Contractor
      engaged to manage, dispose, conserve and protect such REO Property by the Master
      Servicer, shall be deposited in the Distribution Account in accordance with
      Section 3.10(d)(ii) on the Master Servicer Remittance Date in the month
      following the receipt thereof for distribution on the related Distribution
      Date
      in accordance with Section 4.01. Any REO Disposition shall be for cash only
      (unless changes in the REMIC Provisions made subsequent to the Startup Day
      allow
      a sale for other consideration).

     

    (g) The
      Master Servicer shall file information returns with respect to the receipt
      of
      mortgage interest received in a trade or business, reports of foreclosures
      and
      abandonments of any Mortgaged Property and cancellation of indebtedness income
      with respect to any Mortgaged Property as required by Sections 6050H, 6050J
      and
      6050P of the Code, respectively. Such reports shall be in form and substance
      sufficient to meet the reporting requirements imposed by such Sections 6050H,
      6050J and 6050P of the Code.

     

    Section
      3.24 Obligations
      of the Master Servicer in Respect of Prepayment Interest
      Shortfalls.

     

    The
      Master Servicer shall deliver to the Trustee for deposit into the Distribution
      Account on or before 5:00 p.m. New York time on the Master Servicer Remittance
      Date from its own funds an amount equal to the lesser of (i) the aggregate
      of
      the Prepayment Interest Shortfalls for the related Distribution Date resulting
      from Principal Prepayments in Full or Curtailments during the related Prepayment
      Period and (ii) the portion of its aggregate Servicing Fee which accrued at
      a
      Servicing Fee Rate for the most recently ended calendar month (“Compensating
      Interest”).

     

    Section
      3.25 Administration
      of Buydown Funds.

     

    The
      Buydown Account established and maintained by the Master Servicer with respect
      to each Buydown Mortgage Loan shall be an Eligible Account. Upon receipt from
      the Mortgagor of the amount due on a Due Date for each Buydown Mortgage Loan,
      the Master Servicer will withdraw from the related Buydown Account the
      predetermined amount that, when added to the amount due on such date from the
      Mortgagor, equals the Monthly Payment and will deposit that amount together
      with
      the related payment made by the Mortgagor in the Collection Account. The Buydown
      Account shall not be an asset of any REMIC and for federal income tax purposes
      shall be owned by the Master Servicer.

     

    If
      any
      Mortgagor on a Buydown Mortgage Loan prepays such Mortgage Loan in its entirety
      during the Buydown Period, when Buydown Funds are required to be applied to
      such
      Buydown Mortgage Loan, the Master Servicer will withdraw from the related
      Buydown Account and remit to such Mortgagor or any other Person in accordance
      with the related Buydown Agreement any Buydown Funds remaining in the Buydown
      Account. If a Principal Prepayment by a Mortgagor during the Buydown Period,
      together with any Buydown Funds in the related Buydown Account, will result
      in a
      Principal Prepayment in Full, the Master Servicer will withdraw from the related
      Buydown Account for deposit in the Collection Account the Buydown Funds, which
      together with such Principal Prepayment, will result in a Principal Prepayment
      in Full. If a Mortgagor defaults during the Buydown Period with respect to
      a
      Buydown Mortgage Loan and the Mortgaged Property is sold at foreclosure or
      title
      thereto is acquired on behalf of the Certificateholders, the Master Servicer
      will withdraw from the Buydown Account the Buydown Funds (which shall thereupon
      constitute “Liquidation Proceeds” for purposes of this Agreement) for deposit in
      the Collection Account.

     

    Section
      3.26 Obligations
      of the Master Servicer in Respect of Loan Rates and Monthly
      Payments.

     

    In
      the
      event that a shortfall in any collection on or liability with respect to any
      Mortgage Loan results from or is attributable to a calculation of the principal
      balance of a Mortgage Loan that was made by the Master Servicer in a manner
      not
      consistent with the terms of the related Mortgage Note and this Agreement,
      the
      Master Servicer, upon discovery or receipt of notice thereof, immediately shall
      deliver to the Trustee for deposit in the Distribution Account from its own
      funds the amount of any such shortfall and shall indemnify and hold harmless
      the
      Trust Fund, the Trustee, the Depositor and any successor master servicer in
      respect of any such liability. Such indemnities shall survive the termination
      or
      discharge of this Agreement.

     

    

    ARTICLE
      IV

    PAYMENTS
      TO CERTIFICATEHOLDERS

     

    Section
      4.01 Distribution
      Account; Distributions.

     

    (a) The
      Master Servicer shall remit to the Trustee for deposit into the Distribution
      Account on or before 5:00 P.M. New York time on each Master Servicer Remittance
      Date by wire transfer of immediately available funds an amount equal to the
      sum
      of (i) any Advance for the immediately succeeding Distribution Date, (ii) any
      amount required to be deposited in the Distribution Account pursuant to Sections
      3.10, 3.11, 3.14 or 3.24 and (iii) all other amounts constituting the Available
      Distribution Amount for the immediately succeeding Distribution
      Date.

     

    (b) [reserved]

     

    (c) On
      each
      Distribution Date the Trustee shall distribute to each Certificateholder of
      record as of the next preceding Record Date (other than as provided in Section
      10.01 respecting the final distribution) either in immediately available funds
      (by wire transfer or otherwise) to the account of such Certificateholder at
      a
      bank or other entity having appropriate facilities therefor, if such
      Certificateholder has so notified the Trustee at least five (5) Business Days
      prior to the related Record Date, or otherwise by check mailed to such
      Certificateholder at the address of such Holder appearing in the Certificate
      Register, such Certificateholder’s share (based on the aggregate of the
      Percentage Interests represented by Certificates of the applicable Class held
      by
      such Holder) of the following amounts, in the following order of
      priority:

     

    (i) to
      the
      Senior Certificates, on a pro rata basis based on the Monthly Interest
      Distributable Amount payable on such Certificates with respect to such
      Distribution Date, the Monthly Interest Distributable Amount on such Classes
      of
      Certificates for such Distribution Date, plus any Monthly Interest Distributable
      Amount thereon remaining unpaid from any previous Distribution Date except
      as
      provided in the last paragraph of this Section 4.01(c) (the “Senior Interest
      Distribution Amount”); provided that the Monthly Interest Distributable Amount
      on the Class A-6, Class A-7 and Class A-8 Certificates shall be distributed
      as
      provided in Section 4.01(i) through (k);

     

    (ii) to
      the
      Senior Certificates (other than the Class A-3 Certificates) in the priorities
      and amounts set forth in Section 4.01(d)(i) through (v), the Senior Principal
      Distribution Amount and the Accrual Distribution Amounts (applied to reduce
      the
      Certificate Principal Balances of such Senior Certificates, as
      applicable);

     

    (iii) if
      the
      Certificate Principal Balances of the Subordinate Certificates have not been
      reduced to zero, to the Master Servicer, by remitting for deposit to the
      Collection Account, to the extent of and in reimbursement for any Advances
      previously made with respect to any Mortgage Loan or REO Property which remain
      unreimbursed in whole or in part following the Cash Liquidation or REO
      Disposition of such Mortgage Loan or REO Property, minus any such Advances
      that
      were made with respect to delinquencies that ultimately constituted Excess
      Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses or
      Extraordinary Losses;

     

    (iv) to
      the
      Holders of the Class B-1 Certificates, the Monthly Interest Distributable Amount
      thereon for such Distribution Date, plus any Monthly Interest Distributable
      Amount thereon remaining unpaid from any previous Distribution Date, except
      as
      provided below;

     

    (v) to
      the
      Holders of the Class B-1 Certificates, an amount equal to the Subordinate
      Principal Distribution Amount for such Class of Certificates for such
      Distribution Date, applied in reduction of the Certificate Principal Balance
      of
      the Class B-1 Certificates;

     

    (vi) to
      the
      Holders of the Class B-2 Certificates, the Monthly Interest Distributable Amount
      thereon for such Distribution Date, plus any Monthly Interest Distributable
      Amount thereon remaining unpaid from any previous Distribution Date, except
      as
      provided below;

     

    (vii) to
      the
      Holders of the Class B-2 Certificates, an amount equal to the Subordinate
      Principal Distribution Amount for such Class of Certificates for such
      Distribution Date, applied in reduction of the Certificate Principal Balance
      of
      the Class B-2 Certificates;

     

    (viii) to
      the
      Holders of the Class B-3 Certificates, the Monthly Interest Distributable Amount
      thereon for such Distribution Date, plus any Monthly Interest Distributable
      Amount thereon remaining unpaid from any previous Distribution Date, except
      as
      provided below;

     

    (ix) to
      the
      Holders of the Class B-3 Certificates, an amount equal to the Subordinate
      Principal Distribution Amount for such Class of Certificates for such
      Distribution Date, applied in reduction of the Certificate Principal Balance
      of
      the Class B-3 Certificates;

     

    (x) to
      the
      Holders of the Class B-4 Certificates, the Monthly Interest Distributable Amount
      thereon for such Distribution Date, plus any Monthly Interest Distributable
      Amount thereon remaining unpaid from any previous Distribution Date, except
      as
      provided below;

     

    (xi) to
      the
      Holders of the Class B-4 Certificates, an amount equal to the Subordinate
      Principal Distribution Amount for such Class of Certificates for such
      Distribution Date, applied in reduction of the Certificate Principal Balance
      of
      the Class B-4 Certificates;

     

    (xii) to
      the
      Holders of the Class B-5 Certificates, the Monthly Interest Distributable Amount
      thereon for such Distribution Date, plus any Monthly Interest Distributable
      Amount thereon remaining unpaid from any previous Distribution Date, except
      as
      provided below;

     

    (xiii) to
      the
      Holders of the Class B-5 Certificates, an amount equal to the Subordinate
      Principal Distribution Amount for such Class of Certificates for such
      Distribution Date, applied in reduction of the Certificate Principal Balance
      of
      the Class B-5 Certificates;

     

    (xiv) to
      the
      Holders of the Class B-6 Certificates, an amount equal to the Monthly Interest
      Distributable Amount thereon for such Distribution Date, plus any Monthly
      Interest Distributable Amount thereon remaining unpaid from any previous
      Distribution Date, except as provided below;

     

    (xv) to
      the
      Holders of the Class B-6 Certificates, an amount equal to the Subordinate
      Principal Distribution Amount for such Class of Certificates for such
      Distribution Date, applied in reduction of the Certificate Principal Balance
      of
      the Class B-6 Certificates;

     

    (xvi) to
      the
      Senior Certificates, in the priority set forth in Section 4.01(d) of this
      Agreement, the portion, if any, of the Available Distribution Amount remaining
      after the foregoing distributions, applied to reduce the Certificate Principal
      Balances of such Senior Certificates, but in no event more than the aggregate
      of
      the outstanding Certificate Principal Balances of each such Class of Senior
      Certificates, and thereafter, to each Class of Subordinate Certificates then
      outstanding beginning with such Class with the Highest Priority, any portion
      of
      the Available Distribution Amount remaining after the Senior Certificates have
      been retired, applied to reduce the Certificate Principal Balance of each such
      Class of Subordinate Certificates, but in no event more than the outstanding
      Certificate Principal Balance of each such Class of Subordinate Certificates;
      and

     

    (xvii) to
      the
      Class R-II Certificates, the balance, if any, of the Available Distribution
      Amount.

     

    Notwithstanding
      the foregoing, on any Distribution Date, with respect to the Class of
      Subordinate Certificates outstanding on such Distribution Date with the Lowest
      Priority, or in the event the Subordinate Certificates are no longer
      outstanding, the Senior Certificates, the Monthly Interest Distributable Amount
      thereon remaining unpaid from any previous Distribution Date will be
      distributable only to the extent that such unpaid Monthly Interest Distributable
      Amount was attributable to interest shortfalls relating to the failure of the
      Master Servicer to make any required Advance, or the determination by the Master
      Servicer that any proposed Advance would be a Nonrecoverable Advance with
      respect to the related Mortgage Loan where such Mortgage Loan has not yet been
      the subject of a Cash Liquidation or REO Disposition or the related Liquidation
      Proceeds, Insurance Proceeds and REO Proceeds have not yet been distributed
      to
      the Certificateholders.

     

    (d) The
      Senior Principal Distribution Amount and Accrual Distribution Amounts shall
      be
      distributed to the Senior Certificates (other than the Class A-3 Certificates)
      as follows:

     

    (i) an
      amount
      equal to the Class A-6 Accrual Distribution Amount shall be distributed to
      the
      Class A-4 Certificates and Class A-5 Certificates, concurrently on a pro rata
      basis, until the Certificate Principal Balances thereof have been reduced to
      zero;

     

    (ii)
      an
      amount equal to the Class A-7 Accrual Distribution Amount shall be distributed
      to the Class A-1, Class A-2, Class A-4, Class A-5 and Class A-6 Certificates,
      in
      accordance with the priorities set forth below in clause (v)(B) below, in each
      case until the Certificate Principal Balance thereof has been reduced to
      zero;

     

    (iii)
      an
      amount equal to the Class A-8 Accrual Distribution Amount shall be distributed
      to the Class A-1, Class A-2, Class A-4, Class A-5, Class A-6 and Class A-7
      Certificates, in accordance with the priorities set forth below in clauses
      (v)(B) and (v)(C) below, in each case until the Certificate Principal Balance
      thereof has been reduced to zero;

     

    (iv)
      the
      Senior Principal Distribution Amount shall be distributed to the Class R-I
      Certificates and Class R-II Certificates, concurrently on a pro rata basis,
      until the Certificate Principal Balances thereof have been reduced to
      zero;

     

    (v)
      the
      balance of the Senior Principal Distribution Amount remaining after the
      distributions, if any, described in clause (iv) above shall be distributed
      in
      the following manner and priority:

     

    (A)
      first,
      to the
      Class A-8 Certificates, in reduction of the Certificate Principal Balance
      thereof, until the Certificate Principal Balance thereof has been reduced to
      zero, in an amount equal to the sum of (a) the Lockout Scheduled Percentage
      of
      the aggregate of the collections described in clauses (A), (B) and (E) (to
      the
      extent clause (E) relates to clauses (A) and (B)) of the definition of Senior
      Principal Distribution Amount and (b) the Lockout Prepayment Percentage of
      the
      aggregate of the collections described in clauses (C) and (E) (to the extent
      clause (E) relates to clause (C)) of the definition of Senior Principal
      Distribution Amount;

     

    (B)
      second,
      concurrently as follows:

     

    (1)
      57.4971434622%
      of the
      Senior Principal Distribution Amount distributable under this clause (v)(B)
      to
      the Class A-1 Certificates and Class A-2 Certificates, concurrently on a pro
      rata basis, until the Certificate Principal Balances thereof have been reduced
      to zero; and

     

    (2)
      42.5028565378% of the Senior Principal Distribution Amount distributable under
      this clause (v)(B) shall be distributed in the following manner and priority:
      

     

    (a)
      first,
      to the
      Class A-4 Certificates and Class A-5 Certificates, concurrently on a pro rata
      basis, until the Certificate Principal Balances thereof have been reduced to
      zero; and 

     

    (b)
      second,
      to the
      Class A-6 Certificates, until the Certificate Principal Balance thereof has
      been
      reduced to zero; 

     

    (C)
      third,
      to the
      Class A-7 Certificates, until the Certificate Principal Balance thereof has
      been
      reduced to zero; and

     

    (D)
      fourth,
      to the
      Class A-8 Certificates, until the Certificate Principal Balance thereof has
      been
      reduced to zero.

     

    (e) On
      or
      after the Credit Support Depletion Date, all priorities relating to
      distributions as described in Section 4.01 (d) above in respect of principal
      among the various classes of Senior Certificates (other than the Class A-3
      Certificates) will be disregarded, and, the Senior Principal Distribution Amount
      will be distributed to the remaining Senior Certificates (other than the Class
      A-3 Certificates), pro rata in accordance with their respective outstanding
      Certificate Principal Balances, and the Senior Interest Distribution Amount
      will
      be distributed as set forth in Section 4.01(c)(i). 

     

    (f) After
      the
      reduction of the Certificate Principal Balances of the Senior Certificates
      to
      zero but prior to the Credit Support Depletion Date, the Senior Certificates
      will be entitled to no further distributions of principal thereon and the
      Available Distribution Amount will be paid solely to the holders of the Class
      B
      Certificates, as described herein.

     

    (g) In
      addition to the foregoing distributions, with respect to any Subsequent
      Recoveries, the Master Servicer shall deposit such amounts into the Collection
      Account pursuant to Section 3.10(a). If, after taking into account such
      Subsequent Recoveries, the amount of a Realized Loss is reduced, the amount
      of
      such Subsequent Recoveries will be applied to increase the Certificate Principal
      Balance of the Class of Class B Certificates with the Highest Priority to which
      Realized Losses have been allocated, but not by more than the amount of Realized
      Losses previously allocated to that Class of Class B Certificates pursuant
      to
      Section 4.04. The amount of any remaining Subsequent Recoveries will be applied
      to increase the Certificate Principal Balance of the Class of Class B
      Certificates with the next Highest Priority, up to the amount of such Realized
      Losses previously allocated to that Class of Class B Certificates pursuant
      to
      Section 4.04, and so on. Subsequent Recoveries will be applied to increase,
      from
      zero, the Certificate Principal Balance of a Class of Class B Certificates
      pursuant to the previous sentence if the Certificate Principal Balance of such
      Class was reduced to zero due to the application of Realized Losses. Holders
      of
      such Certificates will not be entitled to any payment in respect of Monthly
      Interest Distributable Amount on the amount of such increases for any Interest
      Accrual Period preceding the Distribution Date on which such increase occurs.
      Any such increases shall be applied to the Certificate Principal Balance of
      each
      Certificate of such Class in accordance with its respective Percentage
      Interest.

     

    (h) Each
      distribution with respect to a Book-Entry Certificate shall be paid to the
      Depository, as Holder thereof, and the Depository shall be responsible for
      crediting the amount of such distribution to the accounts of its Depository
      Participants in accordance with its normal procedures. Each Depository
      Participant shall be responsible for disbursing such distribution to the
      Certificate Owners that it represents and to each indirect participating
      brokerage firm (a “brokerage firm” or “indirect participating firm”) for which
      it acts as agent. Each brokerage firm shall be responsible for disbursing funds
      to the Certificate Owners that it represents. None of the Trustee, the Depositor
      or the Master Servicer shall have any responsibility therefor except as
      otherwise provided by this Agreement or applicable law.

     

    (i) On
      each
      Distribution Date prior to the Class A-6 Accretion Termination Date, an amount
      equal to the Monthly Interest Distributable Amount that would otherwise be
      distributed on the Class A-6 Certificates shall be added to Certificate
      Principal Balance of the Class A-6 Certificates. On or after the related
      Accretion Termination Date, the entire amount of Monthly Interest Distributable
      Amount on the Class A-6 Certificates for such Distribution Date shall be payable
      to the Class A-6 Certificateholders pursuant to Section 4.01(c)(i) of this
      Agreement to the extent not required to reduce the aggregate Certificate
      Principal Balance of the Class A-4 Certificates and Class A-5 Certificates
      to
      zero on such Class A-6 Accretion Termination Date; provided that if the Class
      A-6 Accretion Termination Date is the Credit Support Depletion Date, the entire
      amount of Monthly Interest Distributable Amount on the Class A-6 Certificates
      for such Distribution Date will be paid to the Class A-6 Certificateholders.
      Any
      such Monthly Interest Distributable Amount on the Class A-6 Certificates which
      is required to be paid to the holders of the Class A-4 Certificates and Class
      A-5 Certificates on such Class A-6 Accretion Termination Date will be added
      to
      the Certificate Principal Balance of the Class A-6 Certificates in the manner
      described in the first sentence of this Section 4.01(i).

     

    (j) On
      each
      Distribution Date prior to the Class A-7 Accretion Termination Date, an amount
      equal to the Monthly Interest Distributable Amount that would otherwise be
      distributed on the Class A-7 Certificates shall be added to Certificate
      Principal Balance of the Class A-7 Certificates. On or after the related
      Accretion Termination Date, the entire amount of Monthly Interest Distributable
      Amount on the Class A-7 Certificates for such Distribution Date shall be payable
      to the Class A-7 Certificateholders pursuant to Section 4.01(c)(i) of this
      Agreement to the extent not required to reduce the aggregate Certificate
      Principal Balance of the Class A-1, Class A-2, Class A-4, Class A-5 and Class
      A-6 Certificates to zero on such Class A-7 Accretion Termination Date; provided
      that if the Class A-7 Accretion Termination Date is the Credit Support Depletion
      Date, the entire amount of Monthly Interest Distributable Amount on the Class
      A-7 Certificates for such Distribution Date will be paid to the Class A-7
      Certificateholders. Any such Monthly Interest Distributable Amount on the Class
      A-7 Certificates which is required to be paid to the holders of the Class A-1,
      Class A-2, Class A-4, Class A-5 and Class A-6 Certificates on such Class A-7
      Accretion Termination Date will be added to the Certificate Principal Balance
      of
      the Class A-7 Certificates in the manner described in the first sentence of
      this
      Section 4.01(j).

     

    (k) On
      each
      Distribution Date prior to the Class A-8 Accretion Termination Date, an amount
      equal to the Monthly Interest Distributable Amount that would otherwise be
      distributed on the Class A-8 Certificates shall be added to Certificate
      Principal Balance of the Class A-8 Certificates. On or after the related
      Accretion Termination Date, the entire amount of Monthly Interest Distributable
      Amount on the Class A-8 Certificates for such Distribution Date shall be payable
      to the Class A-8 Certificateholders pursuant to Section 4.01(c)(i) of this
      Agreement to the extent not required to reduce the aggregate Certificate
      Principal Balance of the Class A-1, Class A-2, Class A-4, Class A-5, Class
      A-6
      and Class A-7 Certificates to zero on such Class A-8 Accretion Termination
      Date;
      provided that if the Class A-8 Accretion Termination Date is the Credit Support
      Depletion Date or the Distribution Date occurring in October 2011, the entire
      amount of Monthly Interest Distributable Amount on the Class A-8 Certificates
      for such Distribution Date will be paid to the Class A-8 Certificateholders.
      Any
      such Monthly Interest Distributable Amount on the Class A-8 Certificates which
      is required to be paid to the holders of the Class A-1, Class A-2, Class A-4,
      Class A-5, Class A-6 and Class A-7 Certificates on such Class A-8 Accretion
      Termination Date will be added to the Certificate Principal Balance of the
      Class
      A-8 Certificates in the manner described in the first sentence of this Section
      4.01(k).

     

    (l) Except
      as
      otherwise provided in Section 10.01, if the Master Servicer anticipates that
      a
      final distribution with respect to any Class of Certificates will be made on
      the
      next Distribution Date, the Master Servicer shall, no later than the
      Determination Date in the month of such final distribution, notify the Trustee
      and the Trustee shall, no later than two (2) Business Days after such
      Determination Date, mail on such date to each Holder of such Class of
      Certificates a notice to the effect that: (i) the Trustee anticipates that
      the
      final distribution with respect to such Class of Certificates will be made
      on
      such Distribution Date but only upon presentation and surrender of such
      Certificates at the office of the Trustee or as otherwise specified therein,
      and
      (ii) no interest shall accrue on such Certificates from and after the end of
      the
      prior calendar month.

     

    Any
      funds
      not distributed to any Holder or Holders of Certificates of such Class on such
      Distribution Date because of the failure of such Holder or Holders to tender
      their Certificates shall, on such date, be set aside and held in trust and
      credited to the account of the appropriate non-tendering Holder or Holders.
      If
      any Certificates as to which notice has been given pursuant to this Section
      4.01(l) shall not have been surrendered for cancellation within six months
      after
      the time specified in such notice, the Trustee shall mail a second notice to
      the
      remaining non-tendering Certificateholders to surrender their Certificates
      for
      cancellation in order to receive the final distribution with respect thereto.
      If
      within six months after the second notice all such Certificates shall not have
      been surrendered for cancellation, the Trustee shall take reasonable steps
      as
      directed by the Depositor, or appoint an agent to take reasonable steps, to
      contact the remaining non-tendering Certificateholders concerning surrender
      of
      their Certificates. The costs and expenses of maintaining the fiends in trust
      and of contacting such Certificateholders shall be paid out of the assets
      remaining in the Trust Fund. If within nine months after the second notice
      any
      such Certificates shall not have been surrendered for cancellation, the Class
      R
      Certificateholders shall be entitled to all unclaimed funds and other assets
      which remain subject hereto. No interest shall accrue or be payable to any
      Certificateholder on any amount held in trust as a result of such
      Certificateholder’s failure to surrender its Certificate(s) for final payment
      thereof in accordance with this Section 4.01(l).

     

    (m) Distributions
      of interest shall be deemed to be made to each REMIC I Regular Interest in
      an
      amount equal to the related Uncertificated Monthly Interest Distributable
      Amount. Distributions of principal shall be deemed to be made to each of the
      REMIC I Regular Interests in the same manner and priority as principal payments
      are made to Corresponding Certificated Interests.

     

    Section
      4.02 Statements
      to Certificateholders.

     

    On
      each
      Distribution Date the Trustee shall make available to each Holder of a
      Certificate and to the Depositor, the Master Servicer and the Rating Agency,
      a
      statement based on information contained in the Remittance Report:

     

    (i) the
      amount of the distribution made on such Distribution Date to the Holders of
      each
      Class of Certificates, separately identified, allocable to
      principal;

     

    (ii) the
      amount of the distribution made on such Distribution Date to the Holders of
      each
      Class of Certificates allocable to interest, separately identified;

     

    (iii) the
      aggregate amount of servicing compensation received by the Master Servicer
      during the related Due Period and such other customary information as the
      Trustee deems necessary or desirable, or which a Certificateholder reasonably
      requests, to enable Certificateholders to prepare their tax
      returns;

     

    (iv) the
      aggregate amount of Advances for the related Due Period (including the general
      purpose of such Advances), the aggregate amount of unreimbursed Advances at
      the
      close of business on the Distribution Date, and the general source of funds
      for
      reimbursements;

     

    (v) the
      aggregate Stated Principal Balance of the Mortgage Loans at the close of
      business at the end of the related Due Period;

     

    (vi) the
      number, average balance, weighted average remaining term to maturity and
      weighted average Loan Rate of the Mortgage Loans as of the related Due
      Date;

     

    (vii) the
      number and Stated Principal Balance of the Mortgage Loans in respect of which
      (A) one Monthly Payment is Delinquent, (B) two Monthly Payments are Delinquent,
      (C) three or more Monthly Payments are Delinquent and (D) foreclosure
      proceedings have been commenced, in each case as of the close of business on
      the
      last day of the calendar month preceding such Distribution Date;

     

    (viii) with
      respect to any Mortgage Loan that became an REO Property during the preceding
      calendar month, the unpaid principal balance and the Stated Principal Balance
      of
      such Mortgage Loan as of the date it became an REO Property;

     

    (ix) the
      book
      value of any REO Property as of the close of business on the last Business
      Day
      of the calendar month preceding the Distribution Date, and, cumulatively, the
      total number and cumulative principal balance of all REO Properties as of the
      close of business of the last day of the preceding due period;

     

    (x) the
      aggregate amount of Principal Prepayments made during the related Prepayment
      Period;

     

    (xi) the
      aggregate amount of Realized Losses incurred during the related Due Period
      and
      the cumulative amount of Realized Losses;

     

    (xii) the
      aggregate amount of Extraordinary Trust Fund Expenses withdrawn from the
      Collection Account for such Distribution Date;

     

    (xiii) the
      Certificate Principal Balance or Notional Amount, as the case may be, of each
      Class of Certificates, after giving effect to the distributions made on such
      Distribution Date;

     

    (xiv) the
      Pass-Through Rate for each Class of Certificates and the aggregate amount of
      interest accrued at the related Pass-Through Rate with respect to each Class
      during the related Interest Accrual Period and the respective portions thereof,
      if any, remaining unpaid following the distributions made in respect of such
      Certificates on such Distribution Date;

     

    (xv) the
      aggregate amount of any Prepayment Interest Shortfalls for such Distribution
      Date, to the extent not covered by payments of Compensating Interest by the
      Master Servicer pursuant to Section 3.24;

     

    (xvi) the
      Available Distribution Amount;

     

    (xvii) the
      aggregate Stated Principal Balance of Mortgage Loans purchased by the Master
      Servicer during the related Due Period and indicating the Section of this
      Agreement requiring or allowing the purchase of each such Mortgage
      Loan;

     

    (xviii) the
      applicable Record Dates, Interest Accrual Periods and Determination Date for
      calculating distributions and general Distribution Dates;

     

    (xix) the
      Servicing Fee paid to or retained by the Master Servicer and the Trustee Fee
      paid to the Trustee, in each case for the related Due Period;

     

    (xx) the
      total
      cash flows received and the general sources thereof;

     

    (xxi) the
      cumulative amount of Realized Losses applied to the Certificates to
      date;

     

    (xxii) if
      applicable, material modifications, extensions or waivers to Mortgage Loan
      terms, fees, penalties or payments during the preceding calendar month or that
      have become material over time; and

     

    (xxiii) information
      about any additions of, substitutions for or removal of any Mortgage Loans
      from
      the Trust Fund, and any changes in the underwriting, acquisition or selection
      criteria as to any Mortgage Loans added to the Trust Fund.

     

    The
      Trustee will make the monthly statements described above (and, at its option,
      any additional files containing the same information in an alternative format)
      available on each Distribution Date to Certificateholders, and other parties
      to
      the Pooling and Servicing Agreement via the Trustee’s internet website and its
      fax-on-demand service. The Trustee’s internet website shall initially be located
      at “www.sf.citidirect.com”. Assistance in using the website can be obtained by
      calling the Trustee’s customer service desk at (212) 816-5681. Parties that are
      unable to use the above distribution options are entitled to have a paper copy
      mailed to them via first class mail by calling the customer service desk and
      indicating such. The Trustee shall have the right to change the way monthly
      statements are distributed in order to make such distribution more convenient
      and/or more accessible to the above parties and the Trustee shall provide timely
      and adequate notification to all above parties regarding any such
      changes.

     

    On
      each
      Distribution Date, the Trustee shall provide Bloomberg Financial Markets, L.P.
      (“Bloomberg”) CUSIP level information for each Class of Certificates as of such
      Distribution Date, using a format and media mutually acceptable to the Trustee
      and Bloomberg.

     

    In
      addition, the Trustee will make available, as a convenience for interested
      parties (and not in furtherance of the distribution of any related prospectus
      or
      prospectus supplement under the securities laws), this Agreement, the related
      prospectus and prospectus supplement via the Trustee’s internet
      website.

     

    The
      Trustee will make no representations or warranties as to the accuracy of
      completeness of such documents and will assume no responsibility
      therefor.

     

    In
      connection with providing access to the Trustee’s website, the Trustee may
      require registration and the acceptance of a disclaimer. The Trustee shall
      not
      be liable for the dissemination of information in accordance with this Agreement
      which is not due to an error on the part of the Trustee with respect to such
      information.

     

    In
      the
      case of information furnished pursuant to subclauses (i)-(iii) above, the
      amounts shall also be expressed as a dollar amount per Single
      Certificate.

     

    The
      Trustee shall provide to each Certificateholder any written reports or other
      information required by the Code and regulations thereunder as from time to
      time
      are in force. In addition, upon written request, within a reasonable period
      of
      time after the end of each calendar year, the Trustee shall prepare and forward,
      to each Person who at any time during the calendar year was a Certificateholder,
      a statement containing the information set forth in subclauses (i) - (iii)
      above, aggregated for such calendar year or applicable portion thereof during
      which such person was a Certificateholder.

     

    Section
      4.03 Remittance
      Reports; Advances by the Master Servicer.

     

    (a) On
      the
      second Business Day following each Determination Date but in no event less
      than
      five Business Days prior to the related Distribution Date, the Master Servicer
      shall deliver to the Trustee by telecopy (or by such other means as the Master
      Servicer and the Trustee may agree from time to time) a Remittance Report,
      and
      other data mutually agreed upon, with respect to the related Distribution Date.
      On the same date, the Master Servicer shall make available to the Trustee a
      computer readable magnetic tape or diskette or in such other medium as may
      be
      agreed between the Master Servicer and the Trustee containing the information
      set forth in such Remittance Report with respect to the related Distribution
      Date. The Master Servicer shall deliver or cause to be delivered to the Trustee
      in addition to the information provided on the Remittance Report, such other
      information reasonably available to it with respect to the Mortgage Loans as
      the
      Trustee may reasonably require to perform the calculations necessary to make
      the
      distributions contemplated by Section 4.01 and 4.06 and to prepare the
      statements to Certificateholders contemplated by Section 4.02. The Master
      Servicer shall make a good faith effort to deliver any such additional
      information to the Trustee within two Business Days of any such request,
      provided that in no event shall the Master Servicer be required to provide
      any
      such additional information to the Trustee to the extent the Trustee makes
      such
      request prior to five Business Days prior to the Master Servicer Remittance
      Date. The Trustee shall not be responsible to recompute, recalculate or verify
      any information provided to it by the Master Servicer.

     

    (b) The
      amount of Advances to be made by the Master Servicer for any Distribution Date
      shall equal the sum of (i) the aggregate amount of Monthly Payments (net of
      the
      related Servicing Fee), due during the related Due Period in respect of the
      Mortgage Loans, which Monthly Payments were delinquent on a contractual basis
      as
      of the close of business on the related Determination Date and (ii) with respect
      to each REO Property, which REO Property was acquired during or prior to the
      related Due Period and as to which REO Property an REO Disposition did not
      occur
      during the related Due Period, an amount equal to the excess, if any, of the
      REO
      Imputed Interest on such REO Property for the most recently ended calendar
      month, over the net income from such REO Property transferred to the
      Distribution Account pursuant to Section 4.01 for distribution on such
      Distribution Date, less amounts held for future distributions.

     

    Before
      the close of business New York time on the Master Servicer Remittance Date,
      the
      Master Servicer shall remit in immediately available funds to the Trustee for
      deposit in the Distribution Account an amount equal to the aggregate amount
      of
      Advances, if any, to be made in respect of the Mortgage Loans and REO Properties
      for the related Distribution Date either (i) from its own funds or (ii) from
      the
      Collection Account, to the extent of funds held therein for future distribution
      (in which case it will cause to be made an appropriate entry in the records
      of
      Collection Account that amounts held for future distribution have been, as
      permitted by this Section 4.03, used by the Master Servicer in discharge of
      any
      such Advance) or (iii) in the form of any combination of (i) and (ii)
      aggregating the total amount of Advances to be made by the Master Servicer
      with
      respect to the Mortgage Loans and REO Properties. Any amounts held for future
      distribution and so used shall be appropriately reflected in the Master
      Servicer’s records and replaced by the Master Servicer by deposit in the
      Collection Account on or before any future Master Servicer Remittance Date
      to
      the extent that the Available Distribution Amount for the related Distribution
      Date (determined without regard to Advances to be made on the Master Servicer
      Remittance Date) shall be less than the total amount that would be distributed
      to the Classes of Certificateholders pursuant to Section 4.01 on such
      Distribution Date if such amounts held for future distributions had not been
      so
      used to make Advances. The Trustee will provide notice to the Master Servicer
      by
      telecopy on any Master Servicer Remittance Date or within one Business Day
      in
      the event that the amount remitted by the Master Servicer to the Trustee on
      such
      date is less than the Advances required to be made by the Master Servicer for
      the related Distribution Date, less amounts held for future distributions,
      as
      set forth in the related Remittance Report.

     

    (c) The
      obligation of the Master Servicer to make such Advances is mandatory,
      notwithstanding any other provision of this Agreement but subject to (d) below,
      and, with respect to any Mortgage Loan, shall continue until the Mortgage Loan
      is paid in full or until the recovery of all Liquidation Proceeds thereon;
      provided, however, that such obligation will cease if title to the Mortgaged
      Property is acquired by the Trust Fund in foreclosure or by deed in lieu of
      foreclosure.

     

    (d) Notwithstanding
      anything herein to the contrary, no Advance shall be required to be made
      hereunder by the Master Servicer if such Advance would, if made, constitute
      a
      Nonrecoverable Advance. The determination by the Master Servicer that it has
      made a Nonrecoverable Advance or that any proposed Advance, if made, would
      constitute a Nonrecoverable Advance, shall be evidenced by an Officers’
Certificate of the Master Servicer delivered to the Depositor and the
      Trustee.

     

    Section
      4.04 Allocation
      of Realized Losses.

     

    Prior
      to
      each Distribution Date, the Master Servicer shall determine the total amount
      of
      Realized Losses, if any, that resulted from any Cash Liquidation, Debt Service
      Reduction, Deficient Valuation or REO Disposition that occurred during the
      related Prepayment Period. The amount of each Realized Loss shall be evidenced
      by an Officers’ Certificate. All Realized Losses, other than Excess Special
      Hazard Losses, Extraordinary Losses, Excess Bankruptcy Losses or Excess Fraud
      Losses, shall be allocated as follows: first, to the Class B-6 Certificates
      until the Certificate Principal Balance thereof has been reduced to zero;
      second, to the Class B-5 Certificates until the Certificate Principal Balance
      thereof has been reduced to zero; third, to the Class B-4 Certificates until
      the
      Certificate Principal Balance thereof has been reduced to zero; fourth, to
      the
      Class B-3 Certificates until the Certificate Principal Balance thereof has
      been
      reduced to zero; fifth, to the Class B-2 Certificates until the Certificate
      Principal Balance thereof has been reduced to zero; sixth, to the Class B-1
      Certificates until the Certificate Principal Balance thereof has been reduced
      to
      zero; and thereafter such Realized Losses will be allocated among all the Senior
      Certificates on a pro rata basis, as described below. Any Excess Special Hazard
      Losses, Excess Bankruptcy Losses, Excess Fraud Losses, Extraordinary Losses
      on
      the Mortgage Loans will be allocated among the Senior Certificates and
      Subordinate Certificates, on a pro rata basis, as described below.

     

    As
      used
      herein, an allocation of a Realized Loss on a “pro rata basis” among two or more
      specified Classes of Certificates means an allocation on a pro rata basis,
      among
      the various Classes so specified, to each such Class of Certificates on the
      basis of their then outstanding Certificate Principal Balances prior to giving
      effect to distributions to be made on such Distribution Date in the case of
      the
      principal portion of a Realized Loss or based on the Monthly Interest
      Distributable Amount thereon payable on such Distribution Date (without regard
      to any Compensating Interest for such Distribution Date) in the case of an
      interest portion of a Realized Loss. Any allocation of the principal portion
      of
      Realized Losses (other than Debt Service Reductions) to the Class B Certificates
      then outstanding with the highest numerical designation shall be made by
      operation of the definition of “Certificate Principal Balance” and by operation
      of the provisions of Section 4.01. Allocations of the interest portions of
      Realized Losses shall be made by operation of the definition of “Monthly
      Interest Distributable Amount” and by operation of the provisions of Section
      4.01. Allocations of the principal portion of Debt Service Reductions shall
      be
      made by operation of the provisions of Section 4.01. All Realized Losses and
      all
      other losses allocated to a Class of Certificates hereunder will be allocated
      among the Certificates of such Class in proportion to the Percentage Interests
      evidenced thereby. Realized Losses allocated to the Regular Certificates shall
      be deemed allocated to the REMIC I Regular Interests in the amount and priority
      allocated to Corresponding Certificated Interests. 

     

    Section
      4.05 Information
      Reports to Be Filed by the Master Servicer.

     

    The
      Master Servicer or the Sub-Servicers shall file information reports with respect
      to the receipt of mortgage interest received in a trade or business,
      foreclosures and abandonments of any Mortgaged Property and the information
      returns relating to cancellation of indebtedness income with respect to any
      Mortgaged Property required by Sections 6050H, 6050J and 6050P of the Code,
      respectively, and deliver to the Trustee an Officers’ Certificate stating that
      such reports have been filed. Such reports shall be in form and substance
      sufficient to meet the reporting requirements imposed by such Sections 6050H,
      6050J and 6050P of the Code.

     

    Section
      4.06 Compliance
      with Withholding Requirements.

     

    Notwithstanding
      any other provision of this Agreement, the Trustee shall comply with all federal
      withholding requirements respecting payments to Certificateholders of interest
      or original issue discount on the Mortgage Loans, that the Trustee reasonably
      believes are applicable under the Code. The consent of Certificateholders shall
      not be required for such withholding. In the event the Trustee withholds any
      amount from interest or original issue discount payments or advances thereof
      to
      any Certificateholder pursuant to federal withholding requirements, the Trustee
      shall, together with its monthly report to such Certificateholders pursuant
      to
      Section 4.03 hereof, indicate such amount withheld.

     

    Section
      4.07 [Reserved].

     

    Section
      4.08 Limited
      Purpose Surety Bond.

     

    If
      a
      Required Surety Payment is payable pursuant to the Limited Purpose Surety Bond
      with respect to any Pledged Asset Loans, as determined by the Master Servicer
      and the Pledged Asset Servicer, the Master Servicer shall so notify the Trustee
      as soon as reasonably practicable and the Trustee shall promptly complete the
      notice in the form of Attachment 1 to the Limited Purpose Surety Bond and shall
      promptly submit such notice to the surety as a claim for a Required Surety
      Payment. The Master Servicer shall upon request assist the Trustee in completing
      such notice and shall provide any information requested by the Trustee in
      connection therewith.

     

    Upon
      receipt of a Required Surety Payment from the surety on behalf of the
      Certificateholders, the Trustee shall deposit such Required Surety Payment
      in
      the Distribution Account and shall distribute such Required Surety Payment,
      or
      the proceeds thereof, in accordance with the provisions of Section
      4.01.

     

    The
      Trustee shall (i) receive as attorney-in-fact of each Holder of a Certificate
      any Required Surety Payment from the surety and (ii) disburse the same to the
      Holders of such Certificates as set forth in Section 4.01.

     

    

    ARTICLE
      V

    THE
      CERTIFICATES

     

    Section
      5.01 The
      Certificates.

     

    Each
      of
      the Class A, Class B and Class R Certificates shall be substantially in the
      forms annexed hereto as exhibits, and shall, on original issue, be executed,
      authenticated and delivered by the Trustee to or upon the receipt of a Written
      Order to Authenticate from the Depositor concurrently with the sale and
      assignment to the Trustee of the Trust Fund. Each Class of the Certificates
      (other than the Class R Certificates) shall be initially evidenced by one or
      more Certificates representing a Percentage Interest with a minimum dollar
      denomination of $25,000 and integral dollar multiples of $1 in excess thereof.
      Each Class of Residual Certificates will be issued in registered, certificated
      form in minimum denominations of a 20% Percentage Interest except in the case
      of
      one of each of the Class R-I Certificates and Class R-II Certificates. Provided
      however, that one Certificate of each such Class of Certificates may be in
      a
      different denomination so that the sum of the denominations of all outstanding
      Certificates of such Class shall equal the Certificate Principal Balance or
      Notional Amount of such Class on the Closing Date.

     

    The
      Certificates shall be executed on behalf of the Trust by manual or facsimile
      signature on behalf of the Trustee by a Responsible Officer. Certificates
      bearing the manual or facsimile signatures of individuals who were, at the
      time
      when such signatures were affixed, authorized to sign on behalf of the Trustee
      shall bind the Trust, notwithstanding that such individuals or any of them
      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 such Certificate.
      No
      Certificate shall be entitled to any benefit under this Agreement or be valid
      for any purpose, unless such Certificate shall have been manually authenticated
      by the Trustee substantially in the form provided for herein, and such
      authentication upon any Certificate shall be conclusive evidence, and the only
      evidence, that such Certificate has been duly authenticated and delivered
      hereunder. All Certificates shall be dated the date of their authentication.
      Subject to Section 5.02(c), the Certificates, other than the Class R, Class
      B-4,
      Class B-5 and Class B-6 Certificates, shall be Book-Entry
      Certificates.

     

    Section
      5.02 Registration
      of Transfer and Exchange of Certificates.

     

    (a) The
      Certificate Registrar shall cause to be kept at the Corporate Trust Office
      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 Trustee shall initially serve as Certificate Registrar for the purpose
      of
      registering Certificates and transfers and exchanges of Certificates as herein
      provided.

     

    Upon
      surrender for registration of transfer of any Certificate at any office or
      agency of the Certificate Registrar maintained for such purpose pursuant to
      the
      foregoing paragraph and, in the case of a Class R Certificate, upon satisfaction
      of the conditions set forth below, the Trustee on behalf of the Trust shall
      execute, authenticate and deliver, in the name of the designated transferee
      or
      transferees, one or more new Certificates of the same aggregate Percentage
      Interest.

     

    At
      the
      option of the Certificateholders, Certificates may be exchanged for other
      Certificates in authorized denominations and the same aggregate Percentage
      Interests, upon surrender of the Certificates to be exchanged at any such office
      or agency. Whenever any Certificates are so surrendered for exchange, the
      Trustee shall execute on behalf of the Trust and authenticate and deliver the
      Certificates which the Certificateholder making the exchange is entitled to
      receive. Every Certificate presented or surrendered for registration of transfer
      or exchange shall (if so required by the Trustee or the Certificate Registrar)
      be duly endorsed by, or be accompanied by a written instrument of transfer
      satisfactory to the Trustee and the Certificate Registrar duly executed by,
      the
      Holder thereof or his attorney duly authorized in writing.

     

    (b) Except
      as
      provided in paragraphs (c) and (d) below, the Book-Entry Certificates shall
      at
      all times remain registered in the name of the Depository or its nominee and
      at
      all times: (i) registration of such Certificates may not be transferred by
      the
      Trustee except to another Depository; (ii) the Depository shall maintain
      book-entry records with respect to the Certificate Owners and with respect
      to
      ownership and transfers of such Certificates; (iii) ownership and transfers
      of
      registration of such Certificates on the books of the Depository shall be
      governed by applicable rules established by the Depository; (iv) the Depository
      may collect its usual and customary fees, charges and expenses from its
      Depository Participants; (v) the Trustee shall for all purposes deal with the
      Depository as representative of the Certificate Owners of the Certificates
      for
      purposes of exercising the rights of Holders under this Agreement, and requests
      and directions for and votes of such representative shall not be deemed to
      be
      inconsistent if they are made with respect to different Certificate Owners;
      (vi)
      the Trustee may rely and shall be fully protected in relying upon information
      furnished by the Depository with respect to its Depository Participants and
      furnished by the Depository Participants with respect to indirect participating
      firms and Persons shown on the books of such indirect participating firms as
      direct or indirect Certificate Owners; and (vii) the direct participants of
      the
      Depository shall have no rights under this Agreement under or with respect
      to
      any of the Certificates held on their behalf by the Depository, and the
      Depository may be treated by the Trustee and its agents, employees, officers
      and
      directors as the absolute owner of the Certificates for all purposes
      whatsoever.

     

    All
      transfers by Certificate Owners of Book-Entry Certificates shall be made in
      accordance with the procedures established by the Depository Participant or
      brokerage firm representing such Certificate Owners. Each Depository Participant
      shall only transfer Book-Entry Certificates of Certificate Owners that it
      represents or of brokerage firms for which it acts as agent in accordance with
      the Depository’s normal procedures. The parties hereto are hereby authorized to
      execute Letters of Representations with the Depository or take such other action
      as may be necessary or desirable to register a Book-Entry Certificate to the
      Depository. In the event of any conflict between the terms of any such Letter
      of
      Representation and this Agreement, the terms of this Agreement shall
      control.

     

    (c) If
      (i)(x)
      the Depository or the Depositor advises the Trustee in writing that the
      Depository is no longer willing or able to discharge properly its
      responsibilities as Depository and (y) the Trustee or the Depositor is unable
      to
      locate a qualified successor, (ii) the Depositor, at its sole option, with
      the
      consent of the Depository Participants and the Trustee, elects to terminate
      the
      book-entry system through the Depository (with respect to some or all of the
      Book-Entry Certificates) or (iii) after the occurrence of a Master Servicer
      Event of Termination, the Certificate Owners of each Class of Book-Entry
      Certificates representing Percentage Interests of such Classes aggregating
      not
      less than 51% advises the Trustee and the Depository Participants in writing
      that the continuation of a book-entry system through the Depository to the
      exclusion of definitive, fully registered certificates (the “Definitive
      Certificates”) to Certificate Owners is no longer in the best interests of the
      Certificate Owners. Upon surrender to the Certificate Registrar of the
      Book-Entry Certificates by the Depository, accompanied by registration
      instructions from the Depository for registration, the Trustee shall, at the
      Depositor’s expense, in the case of (ii) above, or the related Seller’s expense,
      in the case of (i) and (iii) above, execute on behalf of the Trust and
      authenticate the Definitive Certificates.

     

    In
      addition, if a Master Servicer Event of Termination has occurred and is
      continuing, each Certificate Owner materially adversely affected thereby may
      at
      its option request a Definitive Certificate evidencing such Certificate Owner’s
      Percentage Interest in the related Class of Certificates. In order to make
      such
      request, such Certificate Owner shall, subject to the rules and procedures
      of
      the Depository, provide the Depository or the related Depository Participant
      with directions for the Trustee to exchange or cause the exchange of the
      Certificate Owner’s interest in such Class of Certificates for an equivalent
      Percentage Interest in fully registered definitive form. Upon receipt by the
      Trustee of instruction from the Depository directing the Trustee to effect
      such
      exchange (such instructions to contain information regarding the Class of
      Certificates and the Certificate Principal Balance being exchanged, the
      Depository Participant account to be debited with the decrease, the registered
      holder of and delivery instructions for the Definitive Certificates and any
      other information reasonable required by the Trustee), (i) the Trustee shall
      instruct the Depository to reduce the related Depository Participant’s account
      by the aggregate Certificate Principal Balance of the Definitive Certificates,
      (ii) the Trustee shall execute, authenticate and deliver, in accordance with
      the
      registration and delivery instructions provided by the Depository, a Definitive
      Certificate evidencing such Certificate Owner’s Percentage Interest in such
      Class of Certificates and (iii) the Trustee shall execute and authenticate a new
      Book-Entry Certificate reflecting the reduction in the aggregate Certificate
      Principal Balance of such Class of Certificates by the amount of the Definitive
      Certificates.

     

    Neither
      the Depositor nor the Trustee shall be liable for any delay in delivery of
      any
      instruction required under this section and may conclusively rely on, and shall
      be protected in relying on, such instructions. Upon the issuance of Definitive
      Certificates, the Trustee, the Certificate Registrar, the Master Servicer,
      any
      Paying Agent and the Depositor shall recognize the Holders of the Definitive
      Certificates as Certificateholders hereunder.

     

    (d) No
      transfer, sale, pledge or other disposition of any Private Certificate shall
      be
      made unless such disposition is exempt from the registration requirements of
      the
      Securities Act of 1933, as amended (the “1933 Act”), and any applicable state
      securities laws or is made in accordance with the 1933 Act and
      laws.

     

    (i) In
      the
      event of any such transfer, (A) if such transfer is made in reliance upon Rule
      144A under the 1933 Act, the Trustee shall require the transferor to execute
      a
      transferor certificate in substantially the form attached hereto as Exhibit
      F-2
      and the transferee to execute an investment letter in substantially the form
      attached hereto as Exhibit F-1, or (B) (1) (x) if such transfer is made to
      an
      institutional “accredited investor” within the meaning of within the meaning of
      Rule 501(a) promulgated pursuant to the 1933 Act (in the case of a Class A-6,
      Class A-7, Class A-8, Class B-1, Class B-2, Class B-3, Class B-4 or Class B-5
      Certificate) or (y) if such transfer is made to an “accredited investor” within
      the meaning of Rule 501(a) promulgated pursuant to the 1933 Act (in the case
      of
      a Class B-6 Certificate), the Trustee shall require the transferor to execute
      a
      transferor certificate (in substantially the form attached hereto as Exhibit
      F-2) and the transferee to execute an investment letter (in substantially the
      form attached hereto as Exhibit F-3) acceptable to and in form and substance
      reasonably satisfactory to the Depositor and the Trustee certifying to the
      Depositor and the Trustee the facts surrounding such transfer, which investment
      letter shall not be an expense of the Trustee or the Depositor and (2) the
      Trustee and the Depositor shall require a written Opinion of Counsel (which
      may
      be in-house counsel) acceptable to and in form and substance reasonably
      satisfactory to the Trustee and the Depositor that such transfer may be made
      pursuant to an exemption, describing the applicable exemption and the basis
      therefor, from the 1933 Act or is being made pursuant to the 1933 Act, which
      Opinion of Counsel shall not be an expense of the Trustee or the Depositor.
      The
      Holder of a Private Certificate desiring to effect such transfer shall, and
      does
      hereby agree to, indemnify the Trustee 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) If
      any
      such transfer of a Private Certificate held by the related transferor and also
      to be held by the related transferee in the form of a Book-Entry Certificate
      is
      to be made without registration under the Securities Act, the transferor will
      be
      deemed to have made as of the transfer date each of the representations and
      warranties set forth on Exhibit F-2 hereto in respect of such Private
      Certificate and the transferee will be deemed to have made as of the transfer
      date each of the representations and warranties set forth on Exhibit F-1 hereto
      in respect of such Private Certificate.

     

    (iii) No
      transfer of any Private Certificate that is a Book-Entry Certificate or interest
      therein shall be made by any related Certificate Owner except (A) in the manner
      set forth in clause (ii) above and in reliance on Rule 144A under the 1933
      Act
      to a “qualified institutional buyer” that is acquiring such Book-Entry
      Certificate for its own account or for the account of another “qualified
      institutional buyer” or (B) in the manner set forth in clause (i) above and in
      the form of a Definitive Certificate.

     

    If
      any
      Certificate Owner that is required under this Section 5.02(d) to transfer its
      Book-Entry Certificates in the form of Definitive Certificates, (i) notifies
      the
      Trustee of such transfer or exchange and (ii) transfers such Book-Entry
      Certificates to the Trustee, in its capacity as such, through the book-entry
      facilities of the Depository, then the Trustee shall decrease the balance of
      such Book-Entry Certificates or, the Trustee shall use reasonable efforts to
      cause the surrender to the Certificate Registrar of such Book-Entry Certificates
      by the Depository, and thereupon, the Trustee shall execute, authenticate and
      deliver to such Certificate Owner or its designee one or more Definitive
      Certificates in authorized denominations and with a like aggregate principal
      amount.

     

    Subject
      to the provisions of this Section 5.02(d) governing registration of transfer
      and
      exchange, Private Certificates (i) held as Definitive Certificates may be
      transferred in the form of Book-Entry Certificates in reliance on Rule 144A
      under the 1933 Act to one or more “qualified institutional buyers” that are
      acquiring such Definitive Certificates for their own accounts or for the
      accounts of other “qualified institutional buyers” and (ii) held as Definitive
      Certificates by a “qualified institutional buyer” for its own account or for the
      account of another “qualified institutional buyer” may be exchanged for
      Book-Entry Certificates, in each case upon surrender of such Private
      Certificates for registration of transfer or exchange at the offices of the
      Trustee maintained for such purpose. Whenever any such Private Certificates
      are
      so surrendered for transfer or exchange, either the Trustee shall increase
      the
      balance of the related Book-Entry Certificates or the Trustee shall execute,
      authenticate and deliver the Book-Entry Certificates for which such Private
      Certificates were transferred or exchanged, as necessary and appropriate. No
      Holder of Definitive Certificates other than a “qualified institutional buyer”
holding such Certificates for its own account or for the account of another
      “qualified institutional buyer” may exchange such Private Certificates for
      Book-Entry Certificates. Further, any Certificate Owner of a Book-Entry
      Certificate other than any such “qualified institutional buyers” shall notify
      the Trustee of its status as such and shall transfer such Book-Entry Certificate
      to the Trustee, through the book-entry facilities of the Depository, whereupon,
      and also upon surrender to the Trustee of such Book-Entry Certificate by the
      Depository, (which surrender the Trustee shall use reasonable efforts to cause
      to occur), the Trustee shall execute, authenticate and deliver to such
      Certificate Owner or such Certificate Owner’s nominee one or more Definitive
      Certificates in authorized denominations and with a like aggregate principal
      amount.

     

    (e) No
      purchase or transfer of an ERISA-Restricted Certificate shall be made unless
      the
      Trustee shall have received (i) a representation from the transferee of such
      Certificate, acceptable to and in form and substance satisfactory to the Trustee
      and the Depositor, (such requirement is satisfied only by the Trustee’s receipt
      of a representation letter from the transferee (in the case of a Class B-4,
      Class B-5 or Class B-6 Certificate) substantially in the form of Exhibit G-1
      hereto or receipt of a representation from the transferee (in the case of a
      Class R Certificate) substantially in the form of paragraph (xvii) of Exhibit
      F-4, as appropriate), to the effect that either (a) such transferee is not
      an
      employee benefit plan or arrangement subject to Section 406 of ERISA or a plan
      subject to Section 4975 of the Code, nor a person acting on behalf of any such
      plan or arrangement nor using the assets of any such plan or arrangement to
      effect such transfer (each, a “Plan Investor”) or (b) in the case of a Class
      B-4, Class B-5 or Class B-6 Certificate, the purchase of such Certificate by
      or
      on behalf of such Plan is permissible under applicable law, will not subject
      the
      Depositor, the Trustee or the Master Servicer to any obligation in addition
      to
      those undertaken in the Agreement and the following conditions are satisfied:
      (I) the transferee is an insurance company, (II) the source of funds used to
      purchase such Certificates is an “insurance company general account” (as such
      term is defined in Prohibited Transaction Class Exemption (“PTCE”) 95-60) and
      (III) the conditions set forth in Section III of PTCE 95-60 and all other
      applicable conditions of PTCE 95-60 have been satisfied and as a result the
      acquisition and holding of such Certificates will not constitute or result
      in a
      non-exempt prohibited transaction under ERISA or Section 4975 of the Code or
      (ii) in the case of any such ERISA-Restricted Certificate presented for
      registration in the name of an employee benefit plan subject to ERISA or a
      plan
      or arrangement subject to Section 4975 of the Code (or comparable provisions
      of
      any subsequent enactments), or a trustee of any such plan or any other person
      acting on behalf of any such plan or arrangement or using such plan’s or
      arrangement’s assets, an Opinion of Counsel addressed to the Depositor, the
      Trustee and the Master Servicer, satisfactory to such entities, which Opinion
      of
      Counsel shall not be an expense of such entities, to the effect that the
      purchase or holding of such ERISA-Restricted Certificate is permissible under
      applicable law, will not result in a non-exempt prohibited transaction
      provisions of ERISA or Section 4975 of the Code and will not subject the
      Trustee, the Master Servicer or the Depositor to any obligation or liability
      in
      addition to those expressly undertaken in this Agreement. Notwithstanding
      anything else to the contrary herein, any purported transfer of an
      ERISA-Restricted Certificate to or on behalf of an employee benefit plan subject
      to ERISA or to the Code without the delivery to the Trustee of either a
      representation in the form of Exhibit G-1 (in the case of a Class B-4, Class
      B-5
      or Class B-6 Certificate) or paragraph (xvii) of Exhibit F-4 (in the case of
      a
      Class R Certificate) hereto or an Opinion of Counsel as described above shall
      be
      void and of no effect.

     

    Any
      Holder of a Class A-6, Class A-7, Class A-8, Class B-1, Class B-2 or Class
      B-3
      Certificate or any interest therein that is a Definitive Certificate shall
      represent in the form of Exhibit G-2 with respect to such Certificates, that
      either (i) such Holder is not a Plan Investor or (ii) such Holder is an
“accredited investor” within the meaning of Rule 501(a) promulgated pursuant to
      the 1933 Act. Any Holder of a Class A-6, Class A-7, Class A-8, Class B-1, Class
      B-2 or Class B-3 Certificate or any interest therein that is a Book-Entry
      Certificate shall be deemed to have made the representations described in the
      preceding sentence.

     

    If
      any
      Book-Entry Certificate (or any interest therein) is acquired or held in
      violation of the provisions of Section 5.02(e) above, then the last preceding
      Transferee that either (i) is not a Plan Investor or (ii) is in compliance
      with
      Section 5.02(e)(i)(b) shall be restored, to the extent permitted by law, to
      all
      rights and obligations as Certificate Owner thereof retroactive to the date
      of
      such Transfer of such Certificate. The Trustee shall be under no liability
      to
      any Person for making any payments due on such Certificate to such preceding
      Transferee.

     

    Any
      purported Certificate Owner whose acquisition or holding of any Book-Entry
      Certificate (or interest therein) was effected in violation of the restrictions
      in this Section 5.02(e) shall indemnify and hold harmless the Depositor, the
      Trustee, the Master Servicer and the Trust Fund from and against any and all
      liabilities, claims, costs or expenses incurred by such parties as a result
      of
      such acquisition or holding.

     

    (f) Each
      Person who has or who acquires any Ownership Interest in a Class R Certificate
      shall be deemed by the acceptance or acquisition of such Ownership Interest
      to
      have agreed to be bound by the following provisions and to have irrevocably
      appointed the Depositor or its designee as its attorney-in-fact to negotiate
      the
      terms of any mandatory sale under clause (v) below and to execute all
      instruments of transfer and to do all other things necessary in connection
      with
      any such sale, and the rights of each Person acquiring any Ownership Interest
      in
      a Class R Certificate are expressly subject to the following
      provisions:

     

    (i) Each
      Person holding or acquiring any Ownership Interest in a Class R Certificate
      shall be a Permitted Transferee and shall promptly notify the Trustee of any
      change or impending change in its status as a Permitted Transferee.

     

    (ii) No
      Person
      shall acquire an Ownership Interest in a Class R Certificate unless such
      Ownership Interest is a pro rata undivided interest.

     

    (iii) In
      connection with any proposed transfer of any Ownership Interest in a Class
      R
      Certificate, the Trustee shall as a condition to registration of the transfer,
      require delivery to it, in form and substance satisfactory to it, of each of
      the
      following:

     

    A. an
      affidavit in the form of Exhibit F-4 hereto from the proposed transferee to
      the
      effect that such transferee is a Permitted Transferee and that it is not
      acquiring its Ownership Interest in the Class R Certificate that is the subject
      of the proposed transfer as a nominee, trustee or agent for any Person who
      is
      not a Permitted Transferee; and

     

    B. covenant
      of the proposed transferee to the effect that the proposed transferee agrees
      to
      be bound by and to abide by the transfer restrictions applicable to the Class
      R
      Certificates.

     

    (iv) Any
      attempted or purported transfer of any Ownership Interest in a Class R
      Certificate in violation of the provisions of this Section shall be absolutely
      null and void and shall vest no rights in the purported transferee. If any
      purported transferee shall, in violation of the provisions of this Section,
      become a Holder of a Class R Certificate, then the prior Holder of such Class
      R
      Certificate that is a Permitted Transferee shall, upon discovery that the
      registration of transfer of such Class R Certificate was not in fact permitted
      by this Section, be restored to all rights as Holder thereof retroactive to
      the
      date of registration of transfer of such Class R Certificate. The Trustee shall
      be under no liability to any Person for any registration of transfer of a Class
      R Certificate that is in fact not permitted by this Section or for malting
      any
      distributions due on such Class R Certificate to the Holder thereof or tatting
      any other action with respect to such Holder under the provisions of this
      Agreement so long as the Trustee received the documents specified in clause
      (iii). The Trustee shall be entitled to recover from any Holder of a Class
      R
      Certificate that was in fact not a Permitted Transferee at the time such
      distributions were made all distributions made on such Class R Certificate.
      Any
      such distributions so recovered by the Trustee shall be distributed and
      delivered by the Trustee to the prior Holder of such Class R Certificate that
      is
      a Permitted Transferee.

     

    (v) If
      any
      Person other than a Permitted Transferee acquires any Ownership Interest in
      a
      Class R Certificate in violation of the restrictions in this Section, then
      the
      Trustee shall have the right but not the obligation, without notice to the
      Holder of such Class R Certificate or any other Person having an Ownership
      Interest therein, to notify the Depositor to arrange for the sale of such Class
      R Certificate. The proceeds of such sale, net of commissions (which may include
      commissions payable to the Depositor or its affiliates in connection with such
      sale), expenses and taxes due, if any, will be remitted by the Trustee to the
      previous Holder of such Class R Certificate that is a Permitted Transferee,
      except that in the event that the Trustee determines that the Holder of such
      Class R Certificate may be liable for any amount due under this Section or
      any
      other provisions of this Agreement, the Trustee may withhold a corresponding
      amount from such remittance as security for such claim. The terms and conditions
      of any sale under this clause (v) shall be determined in the sole discretion
      of
      the Trustee and it shall not be liable to any Person having an Ownership
      Interest in a Class R Certificate as a result of its exercise of such
      discretion.

     

    (vi) If
      any
      Person other than a Permitted Transferee acquires any Ownership Interest in
      a
      Class R Certificate in violation of the restrictions in this Section, then
      the
      Trustee upon receipt of reasonable compensation will provide to the Internal
      Revenue Service, and to the persons specified in Sections 860E(e)(3) and (6)
      of
      the Code, information needed to compute the tax imposed under Section 860E(e)(5)
      of the Code on transfers of residual interests to disqualified
      organizations.

     

    The
      foregoing provisions of this Section shall cease to apply to transfers occurring
      on or after the date on which there shall have been delivered to the Trustee,
      in
      form and substance satisfactory to the Trustee, (i) written notification from
      the Rating Agency that the removal of the restrictions on Transfer set forth
      in
      this Section will not cause such Rating Agency to downgrade its rating of the
      Certificates and (ii) an Opinion of Counsel to the effect that such removal
      will
      not cause any REMIC hereunder to fail to qualify as a REMIC.

     

    (g) No
      service charge shall be made for any registration of transfer or exchange of
      Certificates of any Class, but 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.

     

    All
      Certificates surrendered for registration of transfer or exchange shall be
      cancelled by the Certificate Registrar and disposed of pursuant to its standard
      procedures.

     

    Section
      5.03 Mutilated.
      Destroyed. Lost or Stolen Certificates.

     

    If
      (i)
      any mutilated Certificate is surrendered to the Certificate Registrar or the
      Certificate Registrar receives evidence to its satisfaction of the destruction,
      loss or theft of any Certificate and (ii) there is delivered to the Trustee,
      the
      Depositor and the Certificate Registrar such security or indemnity as may be
      required by them to save each of them harmless, then, in the absence of notice
      to the Trustee or the Certificate Registrar that such Certificate has been
      acquired by a bona fide purchaser, the Trustee shall execute on behalf of the
      Trust, 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 Percentage Interest. Upon the issuance of any new Certificate under
      this Section, the 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 relation thereto and any other expenses (including the fees and
      expenses of the Trustee and the Certificate Registrar) in connection therewith.
      Any duplicate Certificate issued pursuant to this Section, shall constitute
      complete and indefeasible 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
      5.04 Persons
      Deemed Owners.

     

    The
      Master Servicer, the Depositor, the Trustee, the Certificate Registrar, any
      Paying Agent and any agent of the Master Servicer, the Depositor, the
      Certificate Registrar, any Paying Agent or the Trustee may treat the Person,
      including a Depository, in whose name any Certificate is registered as the
      owner
      of such Certificate for the purpose of receiving distributions pursuant to
      Section 4.01 and for all other purposes whatsoever, and none of the Master
      Servicer, the Trust, the Trustee nor any agent of any of them shall be affected
      by notice to the contrary.

     

    To
      the
      extent the Trustee, Certificate Registrar or any Paying Agent is required
      pursuant to this Agreement to determine the identity of the beneficial owner
      of
      a Book-Entry Certificate, any costs assessed by the Depository in making such
      determination shall be an expense of the party making such request, but in
      no
      event shall such cost be an expense of the Trust Fund.

     

    Section
      5.05 Appointment
      of Paying Agent.

     

    (a) The
      Paying Agent shall make distributions to Certificateholders from the
      Distribution Account pursuant to Section 4.01 and shall report the amounts
      of
      such distributions to the Trustee. The duties of the Paying Agent may include
      the obligation (i) to withdraw funds from the Distribution Account pursuant
      to
      Sections 3.10 and 3.11 and for the purpose of making the distributions referred
      to above and (ii) to distribute statements and provide information to
      Certificateholders as required hereunder. The Paying Agent hereunder shall
      at
      all times be an entity duly incorporated and validly existing under the laws
      of
      the United States of America or any state thereof, authorized under such laws
      to
      exercise corporate trust powers and subject to supervision or examination by
      federal or state authorities. The Paying Agent shall initially be the Trustee.
      The Trustee may appoint a successor to act as Paying Agent, which appointment
      shall be reasonably satisfactory to the Depositor and the Rating
      Agency.

     

    (b) The
      Trustee shall cause the Paying Agent (if other than the Trustee) to execute
      and
      deliver to the Trustee an instrument in which such Paying Agent shall agree
      with
      the Trustee that such Paying Agent shall hold all sums, if any, held by it
      for
      payment to the Certificateholders in trust for the benefit of the
      Certificateholders entitled thereto until such sums shall be paid to such
      Certificateholders and shall agree that it shall comply with all requirements
      of
      the Code regarding the withholding of payments in respect of Federal income
      taxes due from Certificate Owners and otherwise comply with the provisions
      of
      this Agreement applicable to it.

     

    

    ARTICLE
      VI

    THE
      MASTER SERVICER AND THE DEPOSITOR

     

    Section
      6.01 Liability
      of the Master Servicer and the Depositor.

     

    The
      Master Servicer shall be liable in accordance herewith only to the extent of
      the
      obligations specifically imposed upon and undertaken by the Master Servicer,
      as
      the case may be, herein. The Depositor shall be liable in accordance herewith
      only to the extent of the obligations specifically imposed upon and undertaken
      by the Depositor.

     

    Section
      6.02 Merger
      or
      Consolidation of or Assumption of the Obligations of the Master Servicer or
      the
      Depositor.

     

    Any
      entity into which the Master Servicer or Depositor may be merged or
      consolidated, or any entity resulting from any merger, conversion or
      consolidation to which the Master Servicer or the Depositor shall be a party,
      or
      any corporation succeeding to the business of the Master Servicer or the
      Depositor, shall be the successor of the Master Servicer or the Depositor,
      as
      the case may be, hereunder, without the execution or filing of any paper or
      any
      further act on the part of any of the parties hereto, anything herein to the
      contrary notwithstanding; provided, however, that the successor master servicer
      shall satisfy all the requirements of Section 7.02 with respect to the
      qualifications of a successor master servicer. In addition, the Master Servicer
      may assign the servicing rights with respect to any Mortgage Loans to a third
      party, provided that any such third party shall be an entity that satisfies
      all
      the requirements of Section 7.02 that would be applicable to a successor master
      servicer.

     

    Section
      6.03 Limitation
      on Liability of the Master Servicer and Others.

     

    Neither
      the Master Servicer nor any of the directors or officers or employees or agents
      of the Master Servicer shall be under any liability to the Trust or the
      Certificateholders for any action taken or for refraining from the taking of
      any
      action by the Master Servicer in good faith pursuant to this Agreement, or
      for
      errors in judgment; provided, however, that this provision shall not protect
      the
      Master Servicer or any such Person against any liability which would otherwise
      be imposed by reason of its willful misfeasance, bad faith or negligence in
      the
      performance of duties of the Master Servicer or by reason of its reckless
      disregard of its obligations and duties of the Master Servicer hereunder;
      provided, further, that this provision shall not be construed to entitle the
      Master Servicer to indemnity in the event that amounts advanced by the Master
      Servicer to retire any senior lien exceed Liquidation Proceeds (in excess of
      related liquidation expenses) realized with respect to the related Mortgage
      Loan. The Master Servicer and any director or officer or employee or agent
      of
      the Master Servicer may rely in good faith on any document of any kind prima
      facie properly executed and submitted by any Person respecting any matters
      arising hereunder. The Master Servicer and any director or officer or employee
      or agent of the Master Servicer shall be indemnified by the Trust and held
      harmless against any loss, liability or expense incurred in connection with
      any
      legal action relating to this Agreement or the Certificates, other than any
      loss, liability or expense related to any specific Mortgage Loan or Mortgage
      Loans (except as any such loss, liability or expense shall be otherwise
      reimbursable pursuant to this Agreement) and any loss, liability or expense
      incurred by reason of its willful misfeasance, bad faith or negligence in the
      performance of duties hereunder or by reason of its reckless disregard of
      obligations and duties hereunder. The Master Servicer may undertake any such
      action which it may deem necessary or desirable in respect of this Agreement,
      and the rights and duties of the parties hereto and the interests of the
      Certificateholders hereunder. In such event, the reasonable legal expenses
      and
      costs of such action and any liability resulting therefrom shall be expenses,
      costs and liabilities of the Trust and the Master Servicer shall be entitled
      to
      be reimbursed therefor only pursuant to Section 3.11. The Master Servicer’s
      right to indemnity or reimbursement pursuant to this Section shall survive
      any
      resignation or termination of the Master Servicer pursuant to Section 6.04
      or
      7.01 with respect to any losses, expenses, costs or liabilities arising prior
      to
      such resignation or termination (or arising from events that occurred prior
      to
      such resignation or termination). This paragraph shall apply to the Master
      Servicer solely in its capacity as Master Servicer hereunder and in no other
      capacities.

     

    Section
      6.04 Master
      Servicer Not to Resign.

     

    Subject
      to the provisions of Section 7.01 and Section 6.02, the Master Servicer shall
      not resign from the obligations and duties hereby imposed on it except (i)
      upon
      determination that the performance of its obligations or duties hereunder are
      no
      longer permissible under applicable law or are in material conflict by reason
      of
      applicable law with any other activities carried on by it or its subsidiaries
      or
      Affiliates, the other activities of the Master Servicer so causing such a
      conflict being of a type and nature carried on by the Master Servicer or its
      subsidiaries or Affiliates at the date of this Agreement or (ii) upon
      satisfaction of the following condition: the Rating Agency shall have delivered
      a letter to the Trustee prior to the appointment of the successor master
      servicer stating that the proposed appointment of such successor master servicer
      as Master Servicer hereunder will not result in the reduction or withdrawal
      of
      the then current rating of the Regular Certificates or the ratings that are
      in
      effect; provided, however, that no such resignation by the Master Servicer
      shall
      become effective until such successor master servicer or, in the case of (i)
      above, the Trustee shall have assumed the Master Servicer’s responsibilities and
      obligations hereunder or the Trustee shall have designated a successor master
      servicer in accordance with Section 7.02. Any such resignation shall not relieve
      the Master Servicer of responsibility for any of the obligations specified
      in
      Sections 7.01 and 7.02 as obligations that survive the resignation or
      termination of the Master Servicer. Any such determination permitting the
      resignation of the Master Servicer shall be evidenced by an Opinion of Counsel
      to such effect delivered to the Trustee.

     

    Section
      6.05 Delegation
      of Duties.

     

    In
      the
      ordinary course of business, the Master Servicer at any time may delegate any
      of
      its duties hereunder to any Person, including any of its Affiliates, who agrees
      to conduct such duties in accordance with standards comparable to those set
      forth in Section 3.01, including entering into Sub-Servicing Agreements with
      Sub-Servicers, for the servicing and administration of the Mortgage Loans,
      in
      accordance with the provisions of Section 3.02. Such delegation shall not
      relieve the Master Servicer of its liabilities and responsibilities with respect
      to such duties and shall not constitute a resignation within the meaning of
      Section 6.04. The Master Servicer shall provide the Trustee and the Rating
      Agency with 60 days prior written notice prior to the delegation of any of
      its
      duties to any Person other than any of the Master Servicer’s Affiliates or their
      respective successors and assigns.

     

     

    
 

    ARTICLE
      VII

    DEFAULT

     

    Section
      7.01 Master
      Servicer Events of Termination.

     

    (a) If
      any
      one of the following events (“Master Servicer Events of Termination’ ) shall
      occur and be continuing:

     

    (i) (A)
      The
      failure by the Master Servicer to make any Advance (other than a Nonrecoverable
      Advance); or (B) any other failure by the Master Servicer to deposit in the
      Collection Account or Distribution Account any deposit required to be made
      under
      the terms of this Agreement which continues unremedied for a period of (i)
      one
      Business Day in the case of any such Advance that was required to be remitted
      to
      the Trustee or (ii) five Business Days in the case of any such deposit that
      was
      required to be remitted to the Trustee, provided, that, if the Master Servicer
      cures such failure within the applicable grace period, the amounts remitted
      shall include interest calculated at the applicable federal funds rate;
      or

     

    (ii) The
      failure by the Master Servicer duly to observe or perform, in any material
      respect, any other covenants, obligations or agreements of the Master Servicer
      as set forth in this Agreement, which failure continues unremedied for a period
      of 30 days, after the date (A) on which written notice of such failure,
      requiring the same to be remedied, shall have been given to the Master Servicer
      by the Trustee or by any Holder of a Regular Certificate evidencing at least
      25%
      of the Voting Rights or (B) actual knowledge of such failure by a Servicing
      Officer of the Master Servicer; or

     

    (iii) The
      entry
      against the Master Servicer of a decree or order by a court or agency or
      supervisory authority having jurisdiction in the premises for the appointment
      of
      a trustee, conservator, receiver or liquidator in any insolvency,
      conservatorship, receivership, readjustment of debt, marshalling of assets
      and
      liabilities or similar proceedings, or for the winding up or liquidation of
      its
      affairs, and the continuance of any such decree or order unstayed and in effect
      for a period of 60 days; or

     

    (iv) The
      Master Servicer shall voluntarily go into liquidation, consent to the
      appointment of a conservator or receiver or liquidator or similar person in
      any
      insolvency, readjustment of debt, marshalling of assets and liabilities or
      similar proceedings of or relating to the Master Servicer or of or relating
      to
      all or substantially all of its property; or a decree or order of a court or
      agency or supervisory authority having jurisdiction in the premises for the
      appointment of a conservator, receiver, liquidator or similar person in any
      insolvency, readjustment of debt, marshalling of assets and liabilities or
      similar proceedings, or for the winding-up or liquidation of its affairs, shall
      have been entered against the Master Servicer and such decree or order shall
      have remained in force undischarged, unbonded or unstayed for a period of 60
      days; or the Master Servicer shall admit in writing its inability to pay its
      debts generally as they become due, file a petition to take advantage of any
      applicable insolvency or reorganization statute, make an assignment for the
      benefit of its creditors or voluntarily suspend payment of its
      obligations;

     

    (b) then,
      and
      in each and every such case, so long as a Master Servicer Event of Termination
      shall not have been remedied within the applicable grace period, (x) with
      respect solely to clause (i)(A) above, if such Advance is not made by 11:00
      A.M., New York time, on the Business Day immediately following the Master
      Servicer Remittance Date (provided the Trustee shall give the Master Servicer,
      and the Master Servicer shall have received, notice of such failure to above
      by
      5:00 P.M. New York time on the Master Servicer Remittance Date), the Trustee
      shall terminate all of the rights and obligations of the Master Servicer under
      this Agreement and the Trustee, or a successor master servicer appointed in
      accordance with Section 7.02, shall immediately make such Advance and assume,
      pursuant to the terms of Section 7.02, the duties of a successor master servicer
      and (y) in the case of (i)(B), (ii), (iii) and (iv) above, the Trustee shall,
      at
      the direction of the Holders of each Class of Regular Certificates evidencing
      Percentage Interests aggregating not less than 51%, by notice then given in
      writing to the Master Servicer (and to the Trustee if given by Holders of
      Certificates), terminate all of the rights and obligations of the Master
      Servicer as servicer under this Agreement, to the extent permitted by law,
      and
      in and to the Mortgage Loans and the proceeds thereof. Any such notice to the
      Master Servicer shall also be given to the Rating Agency and the Depositor.
      On
      or after the receipt by the Master Servicer (and by the Trustee if such notice
      is given by the Holders) of such written notice, all authority and power of
      the
      Master Servicer under this Agreement, whether with respect to the Certificates
      or the Mortgage Loans or otherwise, shall pass to and be vested in the Trustee
      or duly appointed successor master servicer pursuant to and under this Section;
      and, without limitation, the Trustee or duly appointed successor master servicer
      is hereby authorized and empowered to execute and deliver, on behalf of the
      Master Servicer, as attorney-in-fact or otherwise, any and all documents and
      other instruments, and to do or accomplish all other acts or things necessary
      or
      appropriate to effect the purposes of such notice of termination, whether to
      complete the transfer and endorsement of each Mortgage Loan and Related
      Documents or otherwise. The Master Servicer agrees to cooperate with the Trustee
      (or the applicable successor master servicer) in effecting the termination
      of
      the responsibilities and rights of the Master Servicer hereunder, including,
      without limitation, the delivery to the Trustee of all documents and records
      requested by it to enable it to assume the Master Servicer’s functions under
      this Agreement within ten Business Days subsequent to such notice, the transfer
      within one Business Day subsequent to such notice to the Trustee (or the
      applicable successor master servicer) for the administration by it of all cash
      amounts that shall at the time be held by the Master Servicer and to be
      deposited by it in the Collection Account, the Distribution Account, any REO
      Account or any Servicing Account or that have been deposited by the Master
      Servicer in such accounts or thereafter received by the Master Servicer with
      respect to the Mortgage Loans or any REO Property received by the Master
      Servicer. All Transition Costs incurred in connection with transferring the
      Mortgage Files to the successor master servicer and amending this Agreement
      to
      reflect such succession as Master Servicer pursuant to this Section shall be
      paid by the predecessor Master Servicer (or if the predecessor Master Servicer
      is the Trustee, the initial Master Servicer) or by the Trust pursuant to Section
      3.11(b)(iv) herein if the Master Servicer does not fulfill its obligations
      hereunder within 45 days of presentation of reasonable documentation of such
      costs and expenses. For purposes of this Section 7.01, the Trustee shall not
      be
      deemed to have knowledge of a Master Servicer Event of Termination unless a
      Responsible Officer of the Trustee assigned to and working in the Trustee’s
      Corporate Trust Office has actual knowledge thereof or unless written notice
      of
      any event which is in fact such a Master Servicer Event of Termination is
      received by the Trustee and such notice references the Certificates, the Trust
      Fund or this Agreement.

     

    Section
      7.02 Trustee
      to Act; Appointment of Successor.

     

    (a) Within
      90
      days of the time the Master Servicer (and the Trustee, if notice is sent by
      the
      Holders) receives a notice of termination pursuant to Section 7.01 or 6.04,
      the
      Trustee (or such other successor master servicer as is approved in accordance
      with this Agreement) shall be the successor in all respects to the Master
      Servicer in its capacity as servicer under this Agreement and the transactions
      set forth or provided for herein and shall be subject to all the
      responsibilities, duties and liabilities relating thereto placed on the Master
      Servicer by the terms and provisions hereof arising on and after its succession;
      provided, however, that if the Trustee is prohibited by law or regulation from
      obligating itself to make advances regarding delinquent mortgage loans, then
      the
      Trustee shall not be obligated to make Advances pursuant to Section 4.06; and
      provided further, it is understood and acknowledged that by the parties hereto
      that there will be a period of transition (not to exceed 90 days) before the
      transfer of servicing obligations is fully effected and that the Trustee (i)
      shall be under no obligation to purchase any Mortgage Loan, and (ii) shall
      have
      no obligation whatsoever with respect to any liability (other than advances
      deemed recoverable and not previously made) incurred by the Master Servicer
      at
      or prior to the time of termination. As compensation therefor, the Trustee
      (or
      such other successor master servicer) shall be entitled to such compensation
      as
      the Master Servicer would have been entitled to hereunder if no such notice
      of
      termination had been given. Notwithstanding the above, (i) if the Trustee is
      unwilling to act as successor master servicer or (ii) if the Trustee is legally
      unable so to act, or if the Holders of Certificates entitled to at least 51%
      of
      the Voting Rights so request in writing to the Trustee, the Trustee shall
      appoint or petition a court of competent jurisdiction to appoint, any
      established housing and home finance institution, bank or other mortgage loan
      or
      home equity loan servicer having a net worth of not less than $50,000,000 as
      the
      successor to the Master Servicer hereunder in the assumption of all or any
      part
      of the responsibilities, duties or liabilities of the Master Servicer hereunder,
      provided, that the appointment of any such successor master servicer will not
      result in the qualification, reduction or withdrawal of the ratings assigned
      to
      the Certificates or the ratings that are in effect by the Rating Agency as
      evidenced by a letter to such effect from the Rating Agency. Pending appointment
      of a successor to the Master Servicer hereunder, unless the Trustee is
      prohibited by law from so acting, the Trustee shall act in such capacity as
      herein above provided. In connection with such appointment and assumption,
      the
      successor shall be entitled to receive compensation out of payments on Mortgage
      Loans in an amount equal to the compensation which the Master Servicer would
      otherwise have received pursuant to Section 3.18 (or such other compensation
      as
      the Trustee and such successor shall agree, not to exceed the Servicing Fee).
      The appointment of a successor master servicer shall not affect any liability
      of
      the predecessor Master Servicer which may have arisen under this Agreement
      prior
      to its termination as Master Servicer to pay any deductible under an insurance
      policy pursuant to Section 3.13 or to indemnify the Trustee pursuant to Section
      8.05, nor shall any successor master servicer be liable for any acts or
      omissions of the predecessor Master Servicer or for any breach by such Master
      Servicer of any of its representations or warranties contained herein or in
      any
      related document or agreement. The Trustee and such successor shall take such
      action, consistent with this Agreement, as shall be necessary to effectuate
      any
      such succession.

     

    (b) Any
      successor, including the Trustee, to the Master Servicer as servicer shall
      during the term of its service as master servicer continue to master service
      and
      administer the Mortgage Loans for the benefit of Certificateholders, and
      maintain in force a policy or policies of insurance covering errors and
      omissions in the performance of its obligations as Master Servicer hereunder
      and
      a Fidelity Bond in respect of its officers, employees and agents to the same
      extent as the Master Servicer is so required pursuant to Section
      3.14.

     

    (c) In
      connection with the termination or resignation of the Master Servicer hereunder,
      either (i) the successor Master Servicer, including the Trustee if the Trustee
      is acting as successor Master Servicer, shall represent and warrant that it
      is a
      member of MERS in good standing and shall agree to comply in all material
      respects with the rules and procedures of MERS in connection with the servicing
      of the Mortgage Loans that are registered with MERS, in which case the
      predecessor Master Servicer shall cooperate with the successor Master Servicer
      in causing MERS to revise its records to reflect the transfer of servicing
      to
      the successor Master Servicer as necessary under MERS’ rules and regulations, or
      (ii) the predecessor Master Servicer shall cooperate with the successor Master
      Servicer in causing MERS to execute and deliver an assignment of Mortgage in
      recordable form to transfer the Mortgage from MERS to the Trustee and to execute
      and deliver such other notices, documents and other instruments as may be
      necessary or desirable to effect a transfer of such Mortgage Loan or servicing
      of such Mortgage Loan on the MERS® System to the successor Master Servicer. The
      predecessor Master Servicer shall file or cause to be filed any such assignment
      in the appropriate recording office. The predecessor Master Servicer shall
      bear
      any and all fees of MERS, costs of preparing any assignments of Mortgage, and
      fees and costs of filing any assignments of Mortgage that may be required under
      this subsection (c). The successor Master Servicer shall cause such assignment
      to be delivered to the Trustee promptly upon receipt of the original with
      evidence of recording thereon or a copy certified by the public recording office
      in which such assignment was recorded.

     

    Section
      7.03 Waiver
      of
      Master Servicer Events of Termination.

     

    The
      Majority Certificateholders may, on behalf of all Certificateholders, waive
      any
      events permuting removal of the Master Servicer as servicer pursuant to this
      Article VII, provided, however, that the Majority Certificateholders may not
      waive such events or a Master Servicer Event of Termination in making a required
      distribution on a Certificate without the consent of the Holder of such
      Certificate. Upon any waiver of a past default, such default shall cease to
      exist and any Master Servicer Event of Termination arising therefrom shall
      be
      deemed to have been remedied for every purpose of this Agreement. No such waiver
      shall extend to any subsequent or other default or impair any right consequent
      thereto except to the extent expressly so waived. Notice of any such waiver
      shall be given by the Trustee to the Rating Agency.

     

    Section
      7.04 Notification
      to Certificateholders.

     

    (a) Upon
      any
      termination or appointment of a successor the Master Servicer pursuant to this
      Article VII or Section 6.04, the Trustee shall give prompt written notice
      thereof to the Certificateholders at their respective addresses appearing in
      the
      Certificate Register and each Rating Agency.

     

    (b) No
      later
      than 60 days after the occurrence of any event which constitutes or which,
      with
      notice or a lapse of time or both, would constitute a Master Servicer Event
      of
      Termination the Trustee shall be deemed to have actual knowledge of such Master
      Servicer Event of Termination five Business Days after a Responsible Officer of
      the Trustee becomes aware of the occurrence of such an event and the Trustee
      shall transmit by mail to all Certificateholders notice of such occurrence
      unless such default or Master Servicer Event of Termination shall have been
      waived or cured. Such notice shall be given to the Rating Agency promptly after
      any such occurrence.

     

    Section
      7.05 Survivability
      of Master Servicer Liabilities.

     

    Notwithstanding
      anything herein to the contrary, upon termination of the Master Servicer
      hereunder, any liabilities of the Master Servicer which accrued prior to such
      termination shall survive such termination.

     

    

    ARTICLE
      VIII

    THE
      TRUSTEE

     

    Section
      8.01 Duties
      of
      Trustee.

     

    The
      Trustee, prior to the occurrence of a Master Servicer Event of Termination
      of
      which a Responsible Officer of the Trustee shall have actual knowledge and
      after
      the curing of all Master Servicer Events of Termination which may have occurred,
      undertakes to perform such duties and only such duties as are specifically
      set
      forth in this Agreement. If a Master Servicer Event of Termination has occurred
      (which has not been cured) of which a Responsible Officer has actual knowledge,
      the Trustee shall exercise such of the rights and powers vested in it by this
      Agreement, and use the same degree of care and skill in their exercise, as
      a
      prudent person would exercise or use under the circumstances in the conduct
      of
      such person’s own affairs.

     

    As
      provided in Section 4.02 hereof, on each Distribution Date, the Trustee shall
      provide Bloomberg Financial Markets, L.P. (“Bloomberg”) CUSIP level information
      for each Class of Certificates as of such Distribution Date, using a format
      and
      media mutually acceptable to the Trustee and Bloomberg.

     

    The
      Trustee, upon receipt of all resolutions, certificates, statements, opinions,
      reports, documents, orders or other instruments furnished to the Trustee which
      are specifically required to be furnished pursuant to any provision of this
      Agreement, shall examine them to determine whether they conform to the
      requirements of this Agreement; provided, however, that the Trustee shall not
      be
      responsible for the accuracy or content of any resolution, certificate,
      statement, opinion, report, document, order or other instrument furnished by
      the
      Master Servicer, the Pledged Asset Servicer or the Depositor hereunder. If
      any
      such instrument is found not to conform in any material respect to the
      requirements of this Agreement, the Trustee shall notify the Certificateholders
      of such instrument in the event that the Trustee, after so requesting, does
      not
      receive a satisfactorily corrected instrument.

     

    The
      Trustee shall prepare and file or cause to be filed on behalf of the Trust
      Fund
      any tax return that is required with respect to the Trust Fund pursuant to
      applicable federal, state or local tax laws.

     

    The
      Trustee covenants and agrees that it shall perform its obligations hereunder
      in
      a manner so as to maintain the status of the Trust Fund as two REMICs under
      the
      REMIC Provisions and to prevent the imposition of any federal, state or local
      income, prohibited transaction, contribution or other tax on the Trust Fund
      to
      the extent that maintaining such status and avoiding such taxes are within
      the
      control of the Trustee and are within the commercially reasonable scope of
      specific responsibilities under this Agreement.

     

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

     

    (i) prior
      to
      the occurrence of a Master Servicer Event of Termination, and after the curing
      of all such Master Servicer Events of Termination which may have occurred,
      the
      duties and obligations of the Trustee shall be determined solely by the express
      provisions of this Agreement, the Trustee shall not be liable except for the
      performance of such duties and obligations as are specifically set forth in
      this
      Agreement, no implied covenants or obligations shall be read into this Agreement
      against the Trustee and, in the absence of bad faith on the part of the Trustee,
      the Trustee may conclusively rely, as to the truth of the statements and the
      correctness of the opinions expressed therein, upon any certificates or opinions
      furnished to the Trustee and conforming to the requirements of this
      Agreement;

     

    (ii) the
      Trustee shall not be personally liable for an error of judgment made in good
      faith by a Responsible Officer of the Trustee, unless it shall be proved by
      a
      court of competent jurisdiction that the Trustee was negligent in ascertaining
      or investigating the facts related thereto;

     

    (iii) the
      Trustee shall not be personally liable with respect to any action taken,
      suffered or omitted to be taken by it in good faith in accordance with the
      direction of the Majority Certificateholders relating to the time, method and
      place of conducting any proceeding for any remedy available to the Trustee,
      or
      exercising or omitting to exercise any trust or power conferred upon the
      Trustee, under this Agreement; and

     

    (iv) the
      Trustee shall not be charged with knowledge of any failure by the Master
      Servicer to comply with the obligations of the Master Servicer referred to
      in
      clauses (i) and (ii) of Section 7.01 or any Master Servicer Event of Termination
      unless a Responsible Officer of the Trustee at the Corporate Trust Office
      obtains actual knowledge of such failure or the Trustee receives written notice
      of such failure from the Master Servicer or the Majority Certificateholders.
      In
      the absence of such receipt of such notice, the Trustee may conclusively assume
      that there is no Master Servicer Event of Termination.

     

    The
      Trustee shall not be required to expend or risk its own funds or otherwise
      incur
      financial liability in the performance of any of its duties hereunder, or in
      the
      exercise of any of its rights or powers, if there is reasonable ground for
      believing that the repayment of such funds or adequate indemnity against such
      risk or liability is not reasonably assured to it, and none of the provisions
      contained in this Agreement shall in any event require the Trustee to perform,
      or be responsible for the manner of performance of, any of the obligations
      of
      the Master Servicer or Pledged Asset Servicer under this Agreement, except
      during such time, if any, as the Trustee shall be the successor to, and be
      vested with the rights, duties, powers and privileges of, the Master Servicer
      in
      accordance with the terms of this Agreement.

     

    The
      Trustee shall not complete foreclosure proceedings, or accept a deed in lieu
      of
      foreclosure, with respect to any Mortgage Loan, unless the Trustee has been
      supplied with an Opinion of Counsel to the effect that if the related Mortgaged
      Property is acquired by the Trust, such Mortgaged Property from such Mortgage
      will qualify as “foreclosure property” within the meaning of Section 860G(a)(8)
      of the Code. In the event that the Trustee acquires possession of any Mortgaged
      Property in spite of the foregoing, the Trustee shall dispose of the acquired
      Mortgaged Property as expeditiously as possible.

     

    The
      Trustee shall have no duty (A) to see any recording, filing, or depositing
      of
      this Agreement or any agreement referred to herein or any financing statement
      or
      continuation statement evidencing a security interest, or to see to the
      maintenance of any such recording or filing or depositing or to any rerecording,
      refiling or redepositing of any thereof, (B) to see to any insurance or (C)
      to
      see to the payment or discharge of any tax, assessment, or other governmental
      charge or any lien or encumbrance of any kind owing with respect to, assessed
      or
      levied against, any part of the Trust Fund other than from funds available
      in
      the Distribution Account to confirm or verify the contents of any reports or
      certificates of the Master Servicer or the Pledged Asset Servicer delivered
      to
      the Trustee pursuant to this Agreement believed by the Trustee to be genuine
      and
      to have been signed or presented by the proper party or parties.

     

    Section
      8.02 Certain
      Matters Affecting the Trustee.

     

    (a) Except
      as
      otherwise provided in Section 8.01:

     

    (i) the
      Trustee may request and conclusively rely upon, and shall be fully protected
      in
      acting or refraining from acting upon, any resolution, Officer’s Certificate,
      certificate of auditors or any other certificate, statement, instrument,
      opinion, report, notice, request, consent, order, appraisal, bond or other
      paper
      or document reasonably believed by it to be genuine and to have been signed
      or
      presented by the proper party or parties;

     

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

     

    (iii) the
      Trustee shall be under no obligation to exercise any of the rights or powers
      vested in it by this Agreement, or to institute, conduct or defend any
      litigation hereunder or in relation hereto, at the request, order or direction
      of the Certificateholders pursuant to the provisions of this Agreement, unless
      such Certificateholders shall have offered to the Trustee reasonable security
      or
      indemnity against the costs, expenses and liabilities which may be incurred
      therein or thereby; the right of the Trustee to perform any discretionary act
      enumerated in this Agreement shall not be construed as a duty, and the Trustee
      shall not be answerable for other than its negligence or willful misconduct
      in
      the performance of any such act;

     

    (iv) the
      Trustee shall not be personally liable for any action taken, suffered or omitted
      by it in good faith and believed by it to be authorized or within the discretion
      or rights or powers conferred upon it by this Agreement;

     

    (v) prior
      to
      the occurrence of a Master Servicer Event of Termination and after the curing
      of
      all Master Servicer Events of Termination which may have occurred, the Trustee
      shall not be bound to make any investigation into the facts or matters stated
      in
      any resolution, certificate, statement, instrument, opinion, report, notice,
      request, consent, order, approval, bond or other paper or documents, unless
      requested in writing to do so by the Majority Certificateholder; provided,
      however, that if the payment within a reasonable time to the Trustee of the
      costs, expenses or liabilities likely to be incurred by it in the making of
      such
      investigation is, in the opinion of the Trustee, not reasonably assured to
      the
      Trustee by the security afforded to it by the terms of this Agreement, the
      Trustee may require reasonable indemnity against such cost, expense or liability
      as a condition to such proceeding. The reasonable expense of every such
      examination shall be paid by the Master Servicer or, if paid by the Trustee,
      shall be reimbursed by the Master Servicer upon demand. Nothing in this clause
      (v) shall derogate from the obligation of the Master Servicer to observe any
      applicable law prohibiting disclosure of information regarding the
      Mortgagors;

     

    (vi) the
      Trustee shall not be accountable, shall have no liability and makes no
      representation as to any acts or omissions hereunder of the Master Servicer
      until such time as the Trustee may be required to act as Master Servicer
      pursuant to Section 7.02;

     

    (vii) the
      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
      and the Trustee shall not be responsible for any misconduct or negligence on
      the
      part of any such agent, attorney or custodian appointed by the Trustee with
      due
      care; and

     

    (viii) the
      right
      of the Trustee to perform any discretionary act enumerated in this Agreement
      shall not be construed as a duty, and the Trustee shall not be answerable for
      other than its negligence or willful misconduct in the performance of such
      act.

     

    Section
      8.03 Trustee
      Not Liable for Certificates or Mortgage Loans.

     

    The
      recitals contained herein and in the Certificates (other than the authentication
      of the Trustee on the Certificates) shall be taken as the statements of the
      Master Servicer, and the Trustee assumes no responsibility for the correctness
      of the same. The Trustee makes no representations as to the validity or
      sufficiency of this Agreement or of the Certificates (other than the signature
      and authentication of the Trustee on the Certificates) or of any Mortgage Loan
      or Related Document, or of MERS or the MERS® System. The Trustee shall not be
      accountable for the use or application by the Master Servicer, or for the use
      or
      application of any funds paid to the Master Servicer in respect of the Mortgage
      Loans or deposited in or withdrawn from the Collection Account by the Master
      Servicer. The Trustee shall at no time have any responsibility or liability
      for
      or with respect to the legality, validity and enforceability of any Mortgage
      or
      any Mortgage Loan, or the perfection and priority of any Mortgage or the
      maintenance of any such perfection and priority, or for or with respect to
      the
      sufficiency of the Trust or its ability to generate the payments to be
      distributed to Certificateholders under this Agreement, including, without
      limitation: the existence, condition and ownership of any Mortgaged Property;
      the existence and enforceability of any hazard insurance thereon (other than
      if
      the Trustee shall assume the duties of the Master Servicer pursuant to Section
      7.02); the validity of the assignment of any Mortgage Loan to the Trustee or
      of
      any intervening assignment; the completeness of any Mortgage Loan; the
      performance or enforcement of any Mortgage Loan (other than if the Trustee
      shall
      assume the duties of the Master Servicer pursuant to Section 7.02); the
      compliance by the Depositor or the Master Servicer with any warranty or
      representation made under this Agreement or in any related document or the
      accuracy of any such warranty or representation prior to the Trustee’s receipt
      of notice or other discovery of any noncompliance therewith or any breach
      thereof, any investment of monies by or at the direction of the Master Servicer
      or any loss resulting therefrom, it being understood that the Trustee shall
      remain responsible for any Trust property that it may hold in its individual
      capacity; the acts or omissions of any of the Master Servicer (other than if
      the
      Trustee shall assume the duties of the Master Servicer pursuant to Section
      7.02), any Sub-Servicer or any Mortgagor, any action of the Master Servicer
      (other than if the Trustee shall assume the duties of the Master Servicer
      pursuant to Section 7.02), or any Sub-Servicer taken in the name of the Trustee;
      the failure of the Master Servicer or any Sub-Servicer to act or perform any
      duties required of it as agent of the Trustee hereunder; or any action by the
      Trustee taken at the instruction of the Master Servicer (other than if the
      Trustee shall assume the duties of the Master Servicer pursuant to Section
      7.02); provided, however, that the foregoing shall not relieve the Trustee
      of
      its obligation to perform its duties under this Agreement. The Trustee shall
      have no responsibility for filing any financing or continuation statement in
      any
      public office at any time or to otherwise perfect or maintain the perfection
      of
      any security interest or lien granted to it hereunder (unless the Trustee shall
      have become the successor master servicer).

     

    Section
      8.04 Trustee
      May Own Certificates.

     

    The
      Trustee in its individual or any other capacity may become the owner or pledgee
      of Certificates with the same rights as it would have if it were not Trustee
      and
      may transact any banking and trust business with the Master Servicer, the
      Depositor or their Affiliates.

     

    Section
      8.05 Master
      Servicer to Pay Trustee Expenses; Trustee Fees.

     

    On
      each
      Distribution Date, the Trustee shall be entitled to withdraw from the
      Distribution Account as compensation hereunder the Trustee Fees. The Master
      Servicer will pay or reimburse the Trustee (or, if the Master Servicer does
      not
      fulfill its obligations hereunder, the Trust Fund will reimburse pursuant to
      Section 3.11(b)(ii) herein) within 30 days upon its request for all reasonable
      expenses, disbursements and advances incurred or made by the Trustee in
      accordance with any of the provisions of this Agreement (including the
      reasonable compensation and the expenses and disbursements of its counsel and
      of
      all persons not regularly in its employ) except any such expense, disbursement
      or advance as may arise from its negligence or bad faith or which is the
      responsibility of the Trustee hereunder. In addition, the Master Servicer
      covenants and agrees to indemnify the Trustee (or, if the Master Servicer does
      not fulfill its obligations hereunder within 30 days upon the Trustee’s request,
      the Trust Fund will indemnify pursuant to Section 3.11(b)(ii) herein) and its
      officers, directors, employees and agents from, and hold it harmless against,
      any and all losses, liabilities, damages, claims or expenses incurred in
      connection with any legal action relating to this Agreement or the Certificates,
      other than any loss, liability or expense incurred by reason of willful
      misfeasance, bad faith or negligence of the Trustee in the performance of its
      duties hereunder or by reason of the Trustee’s reckless disregard of obligations
      and duties hereunder. Anything in this Agreement to the contrary
      notwithstanding, in no event shall the Trustee be liable for special, indirect
      or consequential loss or damage of any kind whatsoever (including but not
      limited to lost profits), even if the Trustee has been advised of the likelihood
      of such loss or damage and regardless of the form of action. The Trustee and
      any
      director, officer, employee or agent of the Trustee shall be indemnified, by
      the
      Trust Fund and held harmless against any loss, liability or expense (not
      including expenses, disbursements and advances incurred or made by the Trustee,
      including the compensation and the expenses and disbursements of its agents
      and
      its counsel, in the ordinary course of the Trustee’s performance of its regular
      duties in accordance with the provisions of this Agreement) incurred by the
      Trustee or such party arising out of or in connection with the acceptance or
      administration of its duties under this Agreement, other than any loss,
      liability or expense incurred by reason of willful misfeasance, bad faith or
      negligence in the performance by the Trustee of its duties under this Agreement
      or by reason of the reckless disregard of the Trustee’s obligations and duties
      under this Agreement. This section shall survive termination of this Agreement
      or the resignation or removal of any Trustee hereunder.

     

    Section
      8.06 Eligibility
      Requirements for Trustee.

     

    The
      Trustee hereunder shall be a corporation or a national banking association,
      and
      duly organized and validly existing under the laws of the United States of
      America or any state thereof, authorized under such laws to exercise corporate
      trust powers, having a combined capital and surplus of at least $50,000,000
      and
      a minimum long-term debt rating of Baa3 by Moody’s and a short-term rating of at
      least A-1 by S&P and A by Fitch, and subject to supervision or examination
      by federal or state authority. If such entity publishes reports of condition
      at
      least annually, pursuant to law or to the requirements of the aforesaid
      supervising or examining authority, then for the purposes of this Section 8.06,
      the combined capital and surplus of such entity shall be deemed to be its
      combined capital and surplus as set forth in its most recent report of condition
      so published. The principal office of the Trustee (other than the initial
      Trustee) shall be in a state with respect to which an Opinion of Counsel has
      been delivered to such Trustee at the time such Trustee is appointed Trustee
      to
      the effect that the Trust will not be a taxable entity under the laws of such
      state. In case at any time the Trustee shall cease to be eligible in accordance
      with the provisions of this Section 8.06, the Trustee shall resign immediately
      in the manner and with the effect specified in Section 8.07.

     

    Section
      8.07 Resignation
      or Removal of Trustee.

     

    The
      Trustee may at any time resign and be discharged from the trusts hereby created
      by giving written notice thereof to the Depositor, the Master Servicer and
      the
      Rating Agency. Upon receiving such notice of resignation, the Depositor shall
      promptly appoint a successor Trustee by written instrument, in duplicate, one
      copy of which instrument shall be delivered to the resigning Trustee and one
      copy to the successor Trustee. If no successor Trustee shall have been so
      appointed and having accepted appointment within 60 days after the giving of
      such notice of resignation, the resigning Trustee may petition any court of
      competent jurisdiction for the appointment of a successor Trustee.

     

    If
      at any
      time the Trustee shall cease to be eligible in accordance with the provisions
      of
      Section 8.06 and shall fail to resign after written request therefor by the
      Depositor, or if at any time the Trustee shall be legally unable to act, or
      shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or
      of
      its property shall be appointed, or any public officer shall take charge or
      control of the Trustee or of its property or affairs for the purpose of
      rehabilitation, conservation or liquidation, then the Depositor may remove
      the
      Trustee. If the Depositor or the Master Servicer removes the Trustee under
      the
      authority of the immediately preceding sentence, the Depositor shall promptly
      appoint a successor Trustee by written instrument, in duplicate, one copy of
      which instrument shall be delivered to the Trustee so removed and one copy
      to
      the successor Trustee.

     

    The
      Majority Certificateholders may at any time remove the Trustee by written
      instrument or instruments delivered to the Master Servicer, the Depositor and
      the Trustee; the Depositor shall thereupon use its best efforts to appoint
      a
      successor Trustee in accordance with this Section.

     

    Any
      resignation or removal of the Trustee and appointment of a successor Trustee
      pursuant to any of the provisions of this Section 8.07 shall not become
      effective until acceptance of appointment by the successor Trustee as provided
      in Section 8.08.

     

    Section
      8.08 Successor
      Trustee.

     

    Any
      successor Trustee appointed as provided in Section 8.07 shall execute,
      acknowledge and deliver to the Depositor, the Rating Agency, the Master Servicer
      and to its predecessor Trustee an instrument accepting such appointment
      hereunder, and thereupon the resignation or removal of the predecessor Trustee
      shall become effective, and such successor Trustee, without any further act,
      deed or conveyance, shall become fully vested with all the rights, powers,
      duties and obligations of its predecessor hereunder, with like effect as if
      originally named as Trustee. The Depositor, the Master Servicer and the
      predecessor 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 Trustee all such rights, powers, duties and
      obligations.

     

    No
      successor Trustee shall accept appointment as provided in this Section 8.08
      unless at the time of such acceptance such successor Trustee shall be eligible
      under the provisions of Section 8.06 and the appointment of such successor
      Trustee shall not result in a downgrading of the Regular Certificates by the
      Rating Agency, as evidenced by a letter from the Rating Agency.

     

    Upon
      acceptance of appointment by a successor Trustee as provided in this Section
      8.08, the successor Trustee shall mail notice of the appointment of a successor
      Trustee hereunder to all Holders of Certificates at their addresses as shown
      in
      the Certificate Register and to the Rating Agency.

     

    Section
      8.09 Merger
      or
      Consolidation of Trustee.

     

    Any
      entity into which the Trustee may be merged or converted or with which it may
      be
      consolidated, or any entity resulting from any merger, conversion or
      consolidation to which the Trustee shall be a party, or any entity succeeding
      to
      the business of the Trustee, shall be the successor of the Trustee hereunder,
      provided such entity shall be eligible under the provisions of Section 8.06
      and
      8.08, without the execution or filing of any paper or any further act on the
      part of any of the parties hereto, anything herein to the contrary
      notwithstanding.

     

    Section
      8.10 Appointment
      of Co-Trustee or Separate Trustee.

     

    Notwithstanding
      any other provisions of this Agreement, at anytime, for the purpose of meeting
      any legal requirements of any jurisdiction in which any part of the Trust or
      any
      Mortgaged Property may at the time be located, the Depositor and the Trustee
      acting jointly shall have the power and shall execute and deliver all
      instruments to appoint one or more Persons approved by the Trustee to act as
      co-trustee or co-trustees, jointly with the Trustee, or separate trustee or
      separate trustees, of all or any part of the Trust, and to vest in such Person
      or Persons, in such capacity and for the benefit of the Certificateholders,
      such
      title to the Trust, or any part thereof, and, subject to the other provisions
      of
      this Section 8.10, such powers, duties, obligations, rights and trusts as the
      Master Servicer and the Trustee may consider necessary or desirable. Any such
      co-trustee or separate trustee shall be subject to the written approval of
      the
      Master Servicer. If the Master Servicer shall not have joined in such
      appointment within 15 days after the receipt by it of a request so to do, or
      in
      the case a Master Servicer Event of Termination shall have occurred and be
      continuing, the Trustee alone shall have the power to make such appointment.
      No
      co-trustee or separate trustee hereunder shall be required to meet the terms
      of
      eligibility as a successor Trustee under Section 8.06, and no notice to
      Certificateholders of the appointment of any co-trustee or separate trustee
      shall be required under Section 8.08. The Master Servicer shall be responsible
      for the fees of any co-trustee or separate trustee appointed
      hereunder.

     

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

     

    (i) all
      rights, powers, duties and obligations conferred or imposed upon the Trustee
      shall be conferred or imposed upon and exercised or performed by the Trustee
      and
      such separate trustee or co-trustee jointly (it being understood that such
      separate trustee or co-trustee is not authorized to act separately without
      the
      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 (whether
      as
      Trustee hereunder or as successor to the Master Servicer hereunder), the Trustee
      shall be incompetent or unqualified to perform such act or acts, in which event
      such rights, powers, duties and obligations (including the holding of title
      to
      the Trust or any portion thereof in any such jurisdiction) shall be exercised
      and performed singly by such separate trustee or co-trustee, but solely at
      the
      direction of the Trustee;

     

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

     

    (iii) the
      Master Servicer and the Trustee, acting jointly may at any time accept the
      resignation of or remove any separate trustee or co-trustee except that
      following the occurrence of a Master Servicer Event of Termination, the Trustee
      acting alone may accept the resignation or remove any separate trustee or
      co-trustee.

     

    Any
      notice, request or other writing given to the Trustee shall be deemed to have
      been given to each of the then separate trustees and co-trustees, as effectively
      as if given to each of them. Every instrument appointing any separate trustee
      or
      co-trustee shall refer to this Agreement and the conditions of this Article
      VIII. Each separate trustee and co-trustee, upon its acceptance of the trusts
      conferred, shall be vested with the estates or property specified in its
      instrument of appointment, either jointly with the Trustee or separately, as
      may
      be provided therein, subject to all the provisions of this Agreement,
      specifically including every provision of this Agreement relating to the conduct
      of, affecting the liability of, or affording protection to, the Trustee. Every
      such instrument shall be filed with the Trustee and a copy thereof given to
      the
      Depositor, the Rating Agency and the Master Servicer.

     

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

     

    Section
      8.11 Limitation
      of Liability.

     

    The
      Certificates are executed by the Trustee, not in its individual capacity but
      solely as Trustee of the Trust, in the exercise of the powers and authority
      conferred and vested in it by the Trust Agreement. Each of the undertakings
      and
      agreements made on the part of the Trustee in the Certificates is made and
      intended not as a personal undertaking or agreement by the Trustee but is made
      and intended for the purpose of binding only the Trust.

     

    Section
      8.12 Trustee
      May Enforce Claims Without Possession of Certificates.

     

    (a) All
      rights of action and claims under this Agreement or the Certificates may be
      prosecuted and enforced by the Trustee without the possession of any of the
      Certificates or the production thereof in any proceeding relating thereto,
      and
      such proceeding instituted by the Trustee shall be brought in its own name
      or in
      its capacity as Trustee for the benefit of all Holders of such Certificates,
      subject to the provisions of this Agreement. Any recovery of judgment shall,
      after provision for the payment of the reasonable compensation, expenses,
      disbursement and advances of the Trustee, its agents and counsel, be for the
      ratable benefit of the Certificateholders in respect of which such judgment
      has
      been recovered.

     

    (b) The
      Trustee shall afford the Depositor, the Master Servicer and each
      Certificateholder upon reasonable notice during normal business hours, access
      to
      all records maintained by the Trustee in respect of its duties hereunder and
      access to officers of the Trustee responsible for performing such duties. The
      Trustee shall cooperate fully with the Master Servicer, the Depositor and such
      Certificateholder and shall make available to the Master Servicer, the Depositor
      and such Certificateholder for review and copying at the expense of the party
      requesting such copies, such books, documents or records as may be requested
      with respect to the Trustee’s duties hereunder. The Depositor, the Master
      Servicer and the Certificateholders shall not have any responsibility or
      liability for any action or failure to act by the Trustee and are not obligated
      to supervise the performance of the Trustee under this Agreement or
      otherwise.

     

    Section
      8.13 Suits
      for
      Enforcement.

     

    In
      case a
      Master Servicer Event of Termination or other default by the Master Servicer
      or
      the Depositor hereunder shall occur and be continuing, the Trustee may proceed
      to protect and enforce its rights and the rights of the Certificateholders
      under
      this Agreement by a suit, action or proceeding in equity or at law or otherwise,
      whether for the specific performance of any covenant or agreement contained
      in
      this Agreement or in aid of the execution of any power granted in this Agreement
      or for the enforcement of any other legal, equitable or other remedy, as the
      Trustee, being advised by counsel, and subject to the foregoing, shall deem
      most
      effectual to protect and enforce any of the rights of the Trustee and the
      Certificateholders.

     

    Section
      8.14 Waiver
      of
      Bond Requirement.

     

    The
      Trustee shall be relieved of, and each Certificateholder hereby waives, any
      requirement of any jurisdiction in which the Trust, or any part thereof, may
      be
      located that the Trustee post a bond or other surety with any court, agency
      or
      body whatsoever.

     

    Section
      8.15 Waiver
      of
      Inventory. Accounting and Appraisal Requirement.

     

    The
      Trustee shall be relieved of, and each Certificateholder hereby waives, any
      requirement of any jurisdiction in which the Trust, or any part thereof, may
      be
      located that the Trustee file any inventory, accounting or appraisal of the
      Trust with any court, agency or body at any time or in any manner
      whatsoever.

     

    Section
      8.16 Right
      of
      Trustee in Capacity of Certificate Registrar or Paying Agent.

     

    In
      the
      event that the Trustee is also acting in the capacity of Paying Agent or
      Certificate Registrar hereunder, the rights, protections, indemnities and
      immunities afforded to the Trustee pursuant to this Article VIII shall also
      be
      afforded to the Trustee in its capacity as Paying Agent or Certificate
      Registrar.

     

    Section
      8.17 Periodic
      Filings.

     

    (a)  (i)
      Within 15 days after each Distribution Date, the Trustee shall, in accordance
      with industry standards, file with the Commission via the Electronic Data
      Gathering and Retrieval System (“EDGAR”), a Distribution Report on Form 10-D,
      signed by the Master Servicer, with a copy of the monthly statement to be
      furnished by the Trustee to the Certificateholders for such Distribution Date.
      Any disclosure in addition to the monthly statement required to be included
      on
      the Form 10-D (“Additional Form 10-D Disclosure”) shall be determined and
      prepared by the entity that is indicated in Exhibit P as the responsible party
      for providing that information, if other than the Trustee, and the Trustee
      will
      have no duty or liability to verify the accuracy or sufficiency of any such
      Additional Form 10-D Disclosure and the Trustee shall have no liability with
      respect to any failure to properly prepare or file such Form 10-D resulting
      from
      or relating to the Trustee’s inability or failure to obtain any information in a
      timely manner from the party responsible for delivery of such Additional Form
      10-D Disclosure.

     

    Within
      5
      calendar days after the related Determination Date, each entity that is
      indicated in Exhibit P as the responsible party for providing Additional Form
      10-D Disclosure shall be required to provide to the Trustee and the Master
      Servicer, to the extent known, clearly identifying which item of Form 10-D
      the
      information relates to, any Additional Form 10-D Disclosure, if applicable.
      The
      Trustee shall compile the information provided to it, prepare the Form 10-D
      and
      forward the Form 10-D to the Master Servicer for verification. The Master
      Servicer will approve, as to form and substance, or disapprove, as the case
      may
      be, the Form 10-D. No later than three Business Days prior to the 15th calendar
      day after the related Distribution Date, an officer of the Master Servicer
      shall
      sign the Form 10-D and return an electronic or fax copy of such signed Form
      10-D
      (with an original executed hard copy to follow by overnight mail) to the
      Trustee.

     

    (ii)
      Within four (4) Business Days after the occurrence of an event requiring
      disclosure on Form 8-K (each such event, a “Reportable Event”), the Depositor
      shall prepare and file any Form 8-K, as required by the Exchange Act, in
      addition to the initial Form 8-K in connection with the issuance of the
      Certificates. Any disclosure or information related to a Reportable Event or
      that is otherwise required to be included on Form 8-K (“Form 8-K Disclosure
      Information”) shall be determined and prepared by the entity that is indicated
      in Exhibit P as the responsible party for providing that
      information.

     

    For
      so
      long as the Trust is subject to the Exchange Act reporting requirements, no
      later than the end of business on the second Business Day after the occurrence
      of a Reportable Event, the entity that is indicated in Exhibit P as the
      responsible party for providing Form 8-K Disclosure Information shall be
      required to provide to the Depositor, to the extent known, the form and
      substance of any Form 8-K Disclosure Information, if applicable. The Depositor
      shall compile the information provided to it, and prepare and file the Form
      8-K,
      which shall be signed by an officer of the Depositor.

     

    (iii)
      Prior to January 30 of the first year in which the Trustee is able to do so
      under applicable law, the Trustee shall, in accordance with industry standards,
      file a Form 15 Suspension Notice with respect to the Trust Fund, if applicable.
      Prior to (x) February 28, 2007 and (y) unless and until a Form 15 Suspension
      Notice shall have been filed, prior to February 28 of each year thereafter,
      the
      Master Servicer shall provide the Trustee with an Annual Compliance Statement,
      together with a copy of the Assessment of Compliance and Attestation Report
      to
      be delivered by the Master Servicer pursuant to Sections 3.20 and 3.21
      (including with respect to any Sub-Servicer or subcontractor, if required to
      be
      filed). Prior to (x) March 31, 2007 and (y) unless and until a Form 15
      Suspension Notice shall have been filed, March 31 of each year thereafter,
      the
      Trustee shall file a Form 10-K, in substance as required by applicable law
      or
      applicable Securities and Exchange Commission staff’s interpretations and
      conforming to industry standards, with respect to the Trust Fund. Such Form
      10-K
      shall include the Assessment of Compliance, Attestation Report, Annual
      Compliance Statements and other documentation provided by the Master Servicer
      pursuant to Sections 3.20 and 3.21 (including with respect to any Sub-Servicer
      or subcontractor, if required to be filed) and Section 3.21 with respect to
      the
      Trustee (including with respect to any subcontractor, if required to be filed),
      and the Form 10-K certification in the form attached hereto as Exhibit M (the
      “Form 10-K Certification”). The Trustee shall receive the items described in the
      preceding sentence no later than March 15 of each calendar year prior to the
      filing deadline for the Form 10-K.

     

    Any
      disclosure or information in addition to that described in the preceding
      paragraph that is required to be included on Form 10-K (“Additional Form 10-K
      Disclosure”) shall be determined and prepared by the entity that is indicated in
      Exhibit P as the responsible party for providing that information, if other
      than
      the Trustee, and the Trustee will have no duty or liability to verify the
      accuracy or sufficiency of any such Additional Form 10-K
      Disclosure.

     

    If
      information, data and exhibits to be included in the Form 10-K are not so timely
      delivered, the Trustee shall file, at the Depositor’s direction, an amended
      Form 10-K including such documents as exhibits reasonably promptly after
      they are delivered to the Trustee. The Trustee shall have no liability with
      respect to any failure to properly prepare or file such periodic reports
      resulting from or relating to the Trustee’s inability or failure to timely
      obtain any information from any other party.

     

    Prior
      to
      (x) March 10, 2007 and (y) unless and until a Form 15 Suspension Notice shall
      have been filed, prior to March 10 of each year thereafter, each entity that
      is
      indicated in Exhibit P as the responsible party for providing Additional Form
      10-K Disclosure shall be required to provide to the Trustee and the Master
      Servicer, to the extent known, the form and substance of any Additional Form
      10-K Disclosure Information, if applicable. The Trustee shall compile the
      information provided to it, prepare the Form 10-K and forward the Form 10-K
      to
      the Master Servicer for verification. The Master Servicer will approve, as
      to
      form and substance, or disapprove, as the case may be, the Form 10-K by no
      later
      than March 25 of the relevant year (or the immediately preceding Business Day
      if
      March 25 is not a Business Day), an officer of the Master Servicer shall sign
      the Form 10-K and return an electronic or fax copy of such signed Form 10-K
      (with an original executed hard copy to follow by overnight mail) to the
      Trustee.

     

    The
      Master Servicer shall be responsible for determining the pool concentration
      applicable to any subservicer to which the Master Servicer delegated any of
      its
      responsibilities with respect to the Mortgage Loans at any time, for purposes
      of
      disclosure as required by Items 1117 and 1119 of Regulation AB. The Trustee
      will
      provide electronic or paper copies of all Form 10-D, 8-K and 10-K filings free
      of charge to any Certificateholder upon written request. Any expenses incurred
      by the Trustee in connection with the previous sentence shall be reimbursable
      to
      the Trustee out of the Trust Fund.

     

    (b)  The
      Trustee shall sign a certification (in the form attached hereto as
      Exhibit N) for the benefit of the Depositor and its officers, directors and
      Affiliates in respect of items 1 through 3 of the Form 10-K Certification
      (provided, however, that the Trustee shall not undertake an analysis of the
      Attestation Report attached as an exhibit to the Form 10-K). Such certification
      shall be delivered to the Master Servicer by March 20th of each year (or if
      not
      a Business Day, the immediately preceding Business Day). The Form 10-K
      Certification attached hereto as Exhibit M shall be delivered to the
      Trustee by March 25th for filing on or prior to March 30th of each year (or
      if
      not a Business Day, the immediately preceding Business Day).

     

    The
      Trustee shall indemnify the Depositor and its officers and directors from and
      against any losses, damages, penalties, fines, forfeitures, reasonable and
      necessary legal fees and related costs, judgments and other costs and expenses
      arising out of or based upon the failure to deliver its Assessment of Compliance
      as required by the last paragraph of Section 3.21; provided,
      however,
      that in
      no event shall the Trustee be liable for any special, consequential, indirect
      or
      punitive damages pursuant to this Section, even if advised of the possibility
      of
      such damages. The Trustee shall have no liability with respect to any failure
      to
      timely file any Form 10-D or Form 10-K resulting from or relating to the
      Trustee’s inability or failure to obtain any information from a party other than
      itself.

    

    (c)  Upon
      any
      filing with the Securities and Exchange Commission, the Trustee shall promptly
      deliver to the Depositor a copy of any such executed report, statement or
      information.

     

    Section
      8.18 Intention
      of the Parties and Interpretation.

     

    Each
      of
      the parties hereto acknowledges and agrees that the purpose of Sections 3.20,
      3.21 and 8.17 of this Agreement is to facilitate compliance by the Sponsor,
      the
      Master Servicer, the Depositor and the Trustee with the provisions of Regulation
      AB, as such may be amended or clarified from time to time. Therefore, each
      of
      the parties agrees that (a) the obligations of the parties hereunder shall
      be
      interpreted in such a manner as to accomplish compliance with Regulation AB,
      (b)
      the parties’ obligations hereunder will be supplemented and modified as
      necessary to be consistent with any such amendments, interpretive advice or
      guidance from the Commission, convention or consensus among active participants
      in the asset-backed securities markets, or otherwise in respect of the
      requirements of Regulation AB and (c) the parties shall comply with reasonable
      requests made by the Master Servicer, the Depositor or the Trustee for delivery
      of additional or different information, to the extent such information is
      available or reasonably attainable, as the Master Servicer, the Depositor or
      the
      Trustee may determine in good faith is necessary to comply with the provisions
      of Regulation AB.

     

    

    ARTICLE
      IX

    REMIC
      ADMINISTRATION

     

    Section
      9.01 REMIC
      Administration.

     

    (a) The
      Trustee shall make elections to treat the Trust Fund as two REMICs under the
      Code and, if necessary, under applicable state law. Each such election will
      be
      made on Form 1066 or other appropriate federal tax or information return or
      any
      appropriate state return for the taxable year ending on the last day of the
      calendar year in which the Certificates are issued. For the purposes of the
      REMIC elections in respect of the Trust Fund, the REMIC I Regular Interests
      shall be designated as the “regular interests” in REMIC I, the Class R-I
      Certificates shall be designated as the sole class of “residual interests” in
      REMIC I, the Regular Certificates shall be designated as the “regular interests”
in REMIC II, and the Class R-II Certificates shall be designated as the sole
      class of “residual interests” in REMIC II. The Master Servicer and the Trustee
      shall not permit the creation of any “interests” (within the meaning of Section
      860G of the Code) in any REMIC other than the Regular Certificates and the
      Class
      R Certificates. Within 30 days after the Closing Date, the Trustee shall prepare
      and file with the Internal Revenue Service Form 8811, “Information Return for
      Real Estate Mortgage Investment Conduits (REMIC) and Issuers of Collateralized
      Debt Obligations” for each REMIC.

     

    The
      Trustee will apply for an Employee Identification Number from the IRS via form
      SS-4 or any other acceptable method for all tax entities.

     

    (b) The
      Closing Date is hereby designated as the “Startup Day” of each REMIC created
      hereunder within the meaning of Section 860G(a)(9) of the Code.

     

    (c) The
      Trustee shall pay out of its own funds, without any right of reimbursement,
      any
      and all expenses relating to any tax audit of the Trust Fund other than the
      expense of obtaining any tax related Opinion of Counsel except as specified
      herein and except that the Trustee shall be entitled to be reimbursed from
      the
      Collection Account for any professional fees and expenses related to any
      non-routine audits or any administrative or judicial proceedings that do not
      result from any breach of its tax duties under this Section 9.01. The Trustee,
      as agent for the Trust Fund’s Tax Matters Person, shall (i) act on behalf of the
      Trust Fund in relation to any tax matter or controversy involving the Trust
      Fund
      and (ii) represent the Trust Fund in any administrative or judicial proceeding
      relating to an examination or audit by any governmental taxing authority with
      respect thereto. By their acceptance thereof, the holder of the largest
      Percentage Interest of the Residual Certificates of each REMIC shall be
      designated as the Tax Matters Person (as defined in the REMIC Provisions) hereby
      agrees to irrevocably appoint the Trustee or an Affiliate as its agent to
      perform all of the duties of the Tax Matters Person for each REMIC.

     

    (d) The
      Trustee shall prepare, sign and file all of the Tax Returns in respect of each
      REMIC created hereunder. The expenses of preparing and filing such returns
      shall
      be borne by the Trustee without any right of reimbursement therefor. The Master
      Servicer shall provide on a timely basis to the Trustee or its designee such
      information with respect to the assets of the Trust Fund as is in its possession
      and reasonably required by the Trustee to enable it to perform its obligations
      under this Article IX.

     

    (e) The
      Trustee shall perform on behalf of the Trust Fund all reporting and other tax
      compliance duties that are the responsibility of the Trust Fund under the Code,
      the REMIC Provisions or other compliance guidance issued by the Internal Revenue
      Service or any state or local taxing authority. Among its other duties, as
      required by the Code, the REMIC Provisions or other such compliance guidance,
      the Trustee shall provide (i) to any Transferor of a Residual Certificate,
      at
      such Transferor’s expense, such information as is necessary for the application
      of any tax relating to the transfer of a Residual Certificate to any Person
      who
      is not a Permitted Transferee, (ii) to the Certificateholders such information
      or reports as are required by the Code or the REMIC Provisions including reports
      relating to interest, original issue discount and market discount or premium
      and
      (iii) to the Internal Revenue Service the name, title, address and telephone
      number of the person who will serve as the representative of the Trust Fund.
      The
      Master Servicer shall provide on a timely basis to the Trustee such information
      with respect to the assets of the Trust Fund, including, without limitation,
      the
      Mortgage Loans, as is in its possession and reasonably required by the Trustee
      to enable it to perform its obligations under this subsection. In addition,
      the
      Depositor shall provide or cause to be provided to the Trustee, within ten
      (10)
      days after the Closing Date, all information or data that the Trustee reasonably
      determines to be relevant for tax purposes as to the valuations and issue prices
      of the Certificates, including, without limitation, the price, yield, prepayment
      assumption and projected cash flow of the Certificates.

     

    (f) To
      the
      extent that the affairs of the Trust Fund are within its control and the scope
      of its specific responsibilities under this Agreement, the Trustee shall take
      such action and shall cause the Trust Fund created hereunder to take such action
      as shall be necessary to create or maintain the status thereof as two REMICs
      under the REMIC Provisions (and the Master Servicer shall assist it, to the
      extent reasonably requested by it). The Trustee shall not knowingly take any
      action, cause the Trust Fund to take any action or fail to take (or fail to
      cause to be taken) any action that, under the REMIC Provisions, if taken or
      not
      taken, as the case may be, could (i) endanger the status of the Trust Fund
      as
      two REMICs or (ii) result in the imposition of a tax upon the Trust Fund
      (including but not limited to the tax on prohibited transactions as defined
      in
      Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set
      forth
      in Section 860G(d) of the Code) (either such event, an “Adverse REMIC Event”)
      unless the Trustee has received an Opinion of Counsel, addressed to the Trustee
      (at the expense of the party seeking to take such action but in no event at
      the
      expense of the Trustee) to the effect that the contemplated action will not,
      with respect to the Trust Fund created hereunder, endanger such status or result
      in the imposition of such a tax, nor shall the Master Servicer take or fail
      to
      take any action (whether or not authorized hereunder) as to which the Trustee
      has advised it in writing that it has received an Opinion of Counsel to the
      effect that an Adverse REMIC Event could occur with respect to such action.
      In
      addition, prior to taking any action with respect to the Trust Fund or the
      assets of the Trust Fund, or causing the Trust Fund to take any action, which
      is
      not contemplated under the terms of this Agreement, the Master Servicer will
      consult with counsel with respect to whether such action could cause an Adverse
      REMIC Event to occur with respect to the Trust Fund, and the Master Servicer
      shall not take any such action or cause the Trust Fund to take any such action
      as to which counsel has advised it in writing that an Adverse REMIC Event could
      occur. The Trustee may consult with counsel to make such written advice, and
      the
      cost of same shall be borne by the party seeking to take the action not
      permitted by this Agreement, but in no event shall such cost be an expense
      of
      the Trustee.

     

    (g) In
      the
      event that any tax is imposed on “prohibited transactions” of the Trust Fund
      created hereunder as defined in Section 860F(a)(2) of the Code, on the “net
      income from foreclosure property” of either REMIC as defined in Section 860G(c)
      of the Code, on any contributions to the Trust Fund after the Startup Day
      therefor pursuant to Section 860G(d) of the Code, or any other tax is imposed
      by
      the Code or any applicable provisions of state or local tax laws, such tax
      shall
      be charged (i) to the Trustee pursuant to Section 9.03 hereof, if such tax
      arises out of or results from a breach by the Trustee of any of its obligations
      under this Article IX, (ii) to the Master Servicer pursuant to Section 9.03
      hereof, if such tax arises out of or results from a breach by the Master
      Servicer of any of its obligations under Article III or this Article IX, or
      otherwise, (iii) to the Master Servicer as provided in Section 3.05 and (iv)
      against amounts on deposit in the Distribution Account and shall be paid by
      withdrawal therefrom to the extent not required to be paid by the Master
      Servicer or the Trustee pursuant to another provision of this
      Agreement.

     

    (h) On
      or
      before April 15 of each calendar year, commencing April 15, 2007, the Trustee
      shall deliver to the Master Servicer and the Rating Agency a Certificate from
      a
      Responsible Officer of the Trustee stating (without regard to any action taken
      by any party other than the Trustee) the Trustee’s compliance with this Article
      IX.

     

    (i) The
      Trustee shall, for federal income tax purposes, maintain books and records
      with
      respect to the Trust Fund on a calendar year and on an accrual
      basis.

     

    (j) Following
      the Startup Day, the Trustee shall not accept any contributions of assets to
      the
      Trust Fund other than in connection with any Eligible Substitute Mortgage Loan
      delivered in accordance with Section 2.03 unless it shall have received an
      Opinion of Counsel (which shall be at the expense of the party requesting to
      make such contribution and not at the expense of the Trustee) to the effect
      that
      the inclusion of such assets in the Trust Fund will not cause the Trust Fund
      to
      fail to qualify as two REMICs at any time that any Certificates are outstanding
      or subject the Trust Fund to any tax under the REMIC Provisions or other
      applicable provisions of federal, state and local law or
      ordinances.

     

    (k) Neither
      the Trustee nor the Master Servicer shall enter into any arrangement by which
      the Trust Fund will receive a fee or other compensation for services nor
      knowingly permit the Trust Fund to receive any income from assets other than
      “qualified mortgages” as defined in Section 860G(a)(3) of the Code or “permitted
      investments” as defined in Section 860G(a)(5) of the Code.

     

    Section
      9.02 Prohibited
      Transactions and Activities.

     

    None
      of
      the Depositor, the Master Servicer or the Trustee shall sell, dispose of or
      substitute for any of the Mortgage Loans (except in connection with (i) the
      foreclosure of a Mortgage Loan, including but not limited to, the acquisition
      or
      sale of a Mortgaged Property acquired by deed in lieu of foreclosure, (ii)
      the
      bankruptcy of the Trust Fund, (iii) the termination of the Trust Fund pursuant
      to Article X of this Agreement, (iv) a substitution pursuant to Article II
      of
      this Agreement or (v) a purchase of Mortgage Loans pursuant to Article II or
      III
      of this Agreement), nor acquire any assets for the Trust Fund (other than REO
      Property acquired in respect of a defaulted Mortgage Loan), nor sell or dispose
      of any investments in the Custodial Account or the Distribution Account for
      gain, nor accept any contributions to the Trust Fund after the Closing Date
      (other than an Eligible Substitute Mortgage Loan delivered in accordance with
      Section 2.03), unless it has received an Opinion of Counsel, addressed to the
      Trustee (at the expense of the party seeking to cause such sale, disposition,
      substitution, acquisition or contribution but in no event at the expense of
      the
      Trustee) that such sale, disposition, substitution, acquisition or contribution
      will not (a) affect adversely the status of the Trust Fund as two REMICs or
      (b)
      cause the Trust Fund to be subject to a tax on “prohibited transactions” or
“contributions” pursuant to the REMIC Provisions.

     

    Section
      9.03 Master
      Servicer and Trustee Indemnification.

     

    (a) The
      Trustee agrees to indemnify the Trust Fund, the Depositor, and the Master
      Servicer for any taxes and costs including, without limitation, any reasonable
      attorneys fees imposed on or incurred by the Trust Fund, the Depositor or the
      Master Servicer, as a result of a breach of the Trustee’s covenants set forth in
      this Article IX, subject, however, to the provision of Sections 8.01 and 8.02
      of
      this Agreement.

     

    (b) The
      Master Servicer agrees to indemnify the Trust Fund, the Depositor and the
      Trustee for any taxes and costs including, without limitation, any reasonable
      attorneys’ fees imposed on or incurred by the Trust Fund, the Depositor or the
      Trustee, as a result of a breach of the Master Servicer’s covenants set forth in
      Article III or this Article IX.

     

    

    ARTICLE
      X

    TERMINATION

     

    Section
      10.01 Termination.

     

    (a) The
      respective obligations and responsibilities of the Master Servicer, the
      Depositor and the Trustee created hereby (other than the obligation of the
      Trustee to make certain payments to Certificateholders after the final
      Distribution Date and the obligation of the Master Servicer to send certain
      notices as hereinafter set forth) shall terminate upon notice to the Trustee
      upon the earliest of (i) the Distribution Date on which the Certificate
      Principal Balance of each Class of Certificates has been reduced to zero, (ii)
      the final payment or other liquidation of the last Mortgage Loan in the Trust,
      and (iii) the optional purchase by the Master Servicer of the Mortgage Loans
      as
      described below. Notwithstanding the foregoing, in no event shall the trust
      created hereby continue beyond the earlier of (i) October 18, 2036 and (ii)
      the
      expiration of 21 years from the death of the last survivor of the descendants
      of
      Joseph P. Kennedy, the late ambassador of the United States to the Court of
      St.
      James’s, living on the date hereof.

     

    The
      Master Servicer may, at its option, terminate this Agreement on any date on
      which the Loan Balance is less than 10% of the aggregate Stated Principal
      Balance of the Mortgage Loans as of the Cut-off Date or by purchasing, on the
      next succeeding Distribution Date, all of the outstanding Mortgage Loans and
      REO
      Properties at a price equal to the sum of the outstanding Stated Principal
      Balance of the Mortgage Loans (or the fair market value of the related
      underlying Mortgaged Property with respect to any REO Properties, if such fair
      market value is less than such outstanding Stated Principal Balance) and accrued
      and unpaid interest thereon at the weighted average of the Loan Rates through
      the end of the Due Period preceding the final Distribution Date plus
      unreimbursed Servicing Advances, Advances and any unpaid Servicing Fees
      allocable to such Mortgage Loans and REO Properties (the “Termination Price”).
      The Termination Price paid by the Master Servicer shall also include any amounts
      owed by PHH Mortgage pursuant to the last paragraph of Section 3.2(a) of the
      Mortgage 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 (xlvi) of such Section, that remain unpaid on the date of such
      purchase.

     

    In
      connection with any such purchase pursuant to the preceding paragraph, the
      Master Servicer shall deposit in the Distribution Account all amounts then
      on
      deposit in the Collection Account (less amounts permitted to be withdrawn by
      the
      Master Servicer pursuant to Section 3.10), which deposit shall be deemed to
      have
      occurred immediately preceding such purchase.

     

    Any
      such
      purchase shall be accomplished by deposit into the Distribution Account on
      the
      Determination Date before such Distribution Date of the Termination Price and
      the delivery of an opinion of counsel that such termination is a “qualified
      liquidation” under Section 860F of the Code.

     

    (b) Notice
      of
      any termination, specifying the Distribution Date (which shall be a date that
      would otherwise be a Distribution Date) upon which the Certificateholders may
      surrender their Certificates to the Trustee for payment of the final
      distribution and cancellation, shall be given promptly by the Trustee upon
      the
      Trustee receiving notice of such date from the Master Servicer, by letter to
      the
      Certificateholders mailed not earlier than the 15th day and not later than
      the
      25th day of the month next preceding the month of such final distribution
      specifying (1) the Distribution Date upon which final distribution of the
      Certificates will be made upon presentation and surrender of such Certificates
      at the office or agency of the Trustee therein designated, (2) the amount of
      any
      such final distribution and (3) that the Record Date otherwise applicable to
      such Distribution Date is not applicable, distributions being made only upon
      presentation and surrender of the Certificates at the office or agency of the
      Trustee therein specified.

     

    (c) Upon
      presentation and surrender of the Certificates, the Trustee shall cause to
      be
      distributed to the Holder of the Certificates on the Distribution Date for
      such
      final distribution, in proportion to the Percentage Interests of their
      respective Class and to the extent that funds are available for such purpose,
      an
      amount equal to the amount required to be distributed to such Holders in
      accordance with the provisions of Section 4.01 for such Distribution
      Date.

     

    (d) In
      the
      event that all Certificateholders shall not surrender their Certificates for
      final payment and cancellation on or before such final Distribution Date, the
      Trustee shall promptly following such date cause all funds in the Distribution
      Account not distributed in final distribution to Certificateholders to be
      withdrawn therefrom and credited to the remaining Certificateholders by
      depositing such funds in a separate servicing account for the benefit of such
      Certificateholders, and the Master Servicer (if the Master Servicer has
      exercised its right to purchase the Mortgage Loans) or the Trustee (in any
      other
      case) shall give a second written notice to the remaining Certificateholders,
      to
      surrender their Certificates for cancellation and receive the final distribution
      with respect thereto. If within nine months after the second notice all the
      Certificates shall not have been surrendered for cancellation, the Class R
      Certificateholders shall be entitled to all unclaimed funds and other assets
      which remain subject hereto, and the Trustee upon transfer of such funds shall
      be discharged of any responsibility for such funds, and the Certificateholders
      shall look to the Class R Certificateholders for payment.

     

    Section
      10.02 Additional
      Termination Requirements.

     

    (a) In
      the
      event that the Master Servicer exercises its purchase option as provided in
      Section 10.01, the Trust Fund shall be terminated in accordance with the
      following additional requirements, unless the Trustee shall have been furnished
      with an Opinion of Counsel to the effect that the failure of the Trust to comply
      with the requirements of this Section will not (i) result in the imposition
      of
      taxes on “prohibited transactions” of the Trust as defined in Section 860F of
      the Code or (ii) cause the Trust Fund constituting part of the Trust Fund to
      fail to qualify as two REMICs at any time that any Certificates are
      outstanding:

     

    (i) Within
      90
      days prior to the final Distribution Date, the Trustee shall adopt and sign
      a
      plan of complete liquidation of the Trust Fund meeting the requirements of
      a
“qualified liquidation” under Section 860F of the Code and any regulations
      thereunder;

     

    (ii) At
      or
      after the time of adoption of such a plan of complete liquidation and at or
      prior to the final Distribution Date, the Trustee shall sell all of the assets
      of the Trust to the Master Servicer for cash pursuant to the terms of the plan
      of complete liquidation; and

     

    (iii) At
      the
      time of the making of the final payment on the Certificates, the Trustee shall
      distribute or credit, or cause to be distributed or credited (A) to the Holders
      of each of the Class A Certificates and Class B Certificates, an amount equal
      to
      the sum of the related Certificate Principal Balance and one month’s interest
      thereon at the applicable Pass-Through Rate, (B) to the Holder of the Class
      A-3
      Certificates one month’s interest on the Notional Amount thereof at the
      applicable Pass-Through Rate, and (C) to the Class R Certificateholders, all
      cash on hand after such payment to the Class A Certificateholders and Class
      B
      Certificateholders (other than cash retained to meet claims) and the Trust
      shall
      terminate at such time.

     

    (b) By
      their
      acceptance of Certificates, the Holder thereof hereby agree to appoint the
      Trustee as their attorney in fact to: (i) adopt such a plan of complete
      liquidation (and the Certificateholders hereby appoint the Trustee as their
      attorney in fact to sign such plan) as appropriate and (ii) to take such other
      action in connection therewith as may be reasonably required to carry out such
      plan of complete liquidation all in accordance with the terms
      hereof.

    

     

    ARTICLE
      XI

    [RESERVED]

     

     

    
 

    ARTICLE
      XII

    MISCELLANEOUS
      PROVISIONS

     

    Section
      12.01 Amendment.

     

    This
      Agreement may be amended from time to time by the Depositor, the Master Servicer
      and the Trustee; and without the consent of the Certificateholders, (i) to
      cure
      any ambiguity, (ii) to correct or supplement any provisions herein which may
      be
      defective or inconsistent with any other provisions herein or (iii) to make
      any
      other provisions with respect to matters or questions arising under this
      Agreement, which shall not be inconsistent with the provisions of this
      Agreement; provided, however, that any such action listed in clause (i) through
      (iii) above shall not adversely affect in any respect the interests of any
      Certificateholder, as evidenced by (i) notice in writing to the Depositor,
      the
      Master Servicer and the Trustee from the Rating Agency that such action will
      not
      result in the reduction or withdrawal of the rating of any outstanding Class
      of
      Certificates with respect to which it is a Rating Agency, or (ii) an Opinion
      of
      Counsel delivered to the Master Servicer and the Trustee.

     

    In
      addition, this Agreement may be amended from time to time by the Depositor,
      the
      Master Servicer and the Trustee, with the consent of the Majority
      Certificateholders for the purpose of adding any provisions to or changing
      in
      any manner or eliminating any of the provisions of this Agreement or of
      modifying in any manner the rights of the Holders of Certificates; provided,
      however, that no such amendment or waiver shall (x) reduce in any manner the
      amount of, or delay the timing of, payments on the Certificates which are
      required to be made on any Certificate without the consent of the Holder of
      such
      Certificate, (y) adversely affect in any material respect the interests of
      the
      Holders of any Class of Certificates in a manner other than as described in
      clause (x) above, without the consent of the Holders of Certificates of such
      Class evidencing at least a 66% Percentage Interest in such Class, or (z) reduce
      the percentage of Voting Rights required by clause (y) above without the consent
      of the Holders of all Certificates of such Class then outstanding. Upon approval
      of an amendment, a copy of such amendment shall be sent to the Rating Agency.
      Prior to the execution of any amendment to this Agreement, the Trustee shall
      be
      entitled to receive and rely upon an Opinion of Counsel (at the expense of
      the
      Person seeking such amendment) stating that the execution of such amendment
      is
      authorized or permitted by this Agreement. The Trustee may, but shall not be
      obligated to, enter into any such amendment which affects the Trustee’s own
      rights, duties or immunities under this Agreement.

     

    Notwithstanding
      any provision of this Agreement to the contrary, the Trustee shall not consent
      to any amendment to this Agreement unless it shall have first received an
      Opinion of Counsel, delivered by (and at the expense of) the Person seeking
      such
      Amendment, to the effect that such amendment will not result in the imposition
      of a federal tax on the Trust Fund pursuant to the REMIC Provisions or cause
      the
      Trust Fund constituting part of the Trust to fail to qualify as two REMICs
      at
      any time that any Certificates are outstanding and that the amendment is being
      made in accordance with the terms hereof.

     

    Promptly
      after the execution of any such amendment the Trustee shall furnish, at the
      expense of the Person that requested the amendment if such Person is the Master
      Servicer (but in no event at the expense of the Trustee), otherwise at the
      expense of the Trust, a copy of such amendment and the Opinion of Counsel
      referred to in the immediately preceding paragraph to the Master Servicer and
      the Rating Agency.

     

    It
      shall
      not be necessary for the consent of Certificateholders under this Section 11.01
      to approve the particular form of any proposed amendment; instead it shall
      be
      sufficient if such consent shall approve the substance thereof. The manner
      of
      obtaining such consents and of evidencing the authorization of the execution
      thereof by Certificateholders shall be subject to such reasonable regulations
      as
      the Trustee may prescribe.

     

    The
      Trustee may, but shall not be obligated to, enter into any amendment pursuant
      to
      this 11.01 Section that affects its rights, duties and immunities under this
      Agreement or otherwise.

     

    Section
      12.02 Recordation
      of Agreement: Counterparts.

     

    To
      the
      extent permitted by applicable law, this Agreement is subject to recordation
      in
      all appropriate public offices for real property records in all the counties
      or
      other comparable jurisdictions in which any or all of the properties subject
      to
      the Mortgages are situated, and in any other appropriate public recording office
      or elsewhere, such recordation to be effected by the Master Servicer at the
      expense of the Trust, but only upon direction of Certificateholders, accompanied
      by an Opinion of Counsel to the effect that such recordation materially and
      beneficially affects the interests of the Certificateholders.

     

    For
      the
      purpose of facilitating the recordation of this Agreement as herein provided
      and
      for other purposes, this Agreement may be executed simultaneously in any number
      of counterparts, each of which counterparts shall be deemed to be an original,
      and such counterparts shall together constitute but one and the same
      instrument.

     

    Section
      12.03 Limitation
      on Rights of Certificateholders.

     

    The
      death
      or incapacity of any Certificateholder shall not (i) operate to terminate this
      Agreement or the Trust, (ii) entitle such Certificateholder’s legal
      representatives or hens to claim an accounting or to take any action or
      proceeding in any court for a partition or winding up of the Trust, or (iii)
      otherwise affect the rights, obligations and liabilities of the parties hereto
      or any of them.

     

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

     

    No
      Certificateholder shall have any right by virtue of any provision of this
      Agreement to institute any suit, action or proceeding in equity or at law upon
      or under or with respect to this Agreement, unless such Holder previously shall
      have given to the Trustee a written notice of default and of the continuance
      thereof, as hereinbefore provided, and unless also the Holders of Certificates
      entitled to at least 25% of the Voting Rights shall have made written request
      upon the Trustee to institute such action, suit or proceeding in its own name
      as
      Trustee hereunder and shall have offered to the Trustee such reasonable
      indemnity as it may require against the costs, expenses and liabilities to
      be
      incurred therein or thereby, and the Trustee for 15 days after its receipt
      of
      such notice, request and offer of indemnity, shall have neglected or refused
      to
      institute any such action, suit or proceeding. It is understood and intended,
      and expressly covenanted by each Certificateholder with every other
      Certificateholder and the Trustee, that no one or more Holders of Certificates
      shall have any right in any manner whatever by virtue of any provision of this
      Agreement to affect, disturb or prejudice the rights of the Holders of any
      other
      of such Certificates, or to obtain or seek to obtain priority over or preference
      to any other such Holder, which priority or preference is not otherwise provided
      for herein, or to enforce any right under this Agreement, except in the manner
      herein provided and for the equal, ratable and common benefit of all
      Certificateholders. For the protection and enforcement of the provisions of
      this
      Section 11.03 each and every Certificateholder and the Trustee shall be entitled
      to such relief as can be given either at law or in equity.

     

    Section
      12.04 Governing
      Law: Jurisdiction.

     

    This
      Agreement shall be construed in accordance with the laws of the State of New
      York, and the obligations, rights and remedies of the parties hereunder shall
      be
      determined in accordance with such laws. With respect to any claim arising
      out
      of this Agreement, each party irrevocably submits to the exclusive jurisdiction
      of the courts of the State of New York and the United States District Court
      located in the Borough of Manhattan in The City of New York, and each party
      irrevocably waives any objection which it may have at any time to the laying
      of
      venue of any suit, action or proceeding arising out of or relating hereto
      brought in any such courts, irrevocably waives any claim that any such suit,
      action or proceeding brought in any such court has been brought in any
      inconvenient forum and further irrevocably waives the light to object, with
      respect to such claim, suit, action or proceeding brought in any such court,
      that such court does not have jurisdiction over such party, provided that
      service of process has been made by any lawful means.

     

    Section
      12.05 Notices.

     

    All
      directions, demands and notices hereunder shall be in writing and shall be
      deemed to have been duly given if personally delivered at or mailed by first
      class mail, postage prepaid, or by express delivery service, to (a) in the
      case
      of the Sellers: (i) PHH Mortgage Corporation, 3000 Leadenhall Road, Mt. Laurel,
      New Jersey 08054 or (ii) Bishop’s Gate Residential Mortgage Trust, c/o PHH
      Mortgage Corporation, 3000 Leadenhall Road, Mt. Laurel, New Jersey 08054, or
      such other address or telecopy number as may be furnished to the Master Servicer
      and the Trustee in writing by either Seller; (b) in the case of the Trustee:
      Citibank, N.A., 388 Greenwich Street, 14th
      Floor,
      New York, New York 10013, Attention: PHHMC Series 2006-3, or such other address
      as may hereafter be furnished to the Depositor, the Sellers and the Master
      Servicer in writing by the Trustee; (c) in the case of the Depositor: PHH
      Mortgage Capital LLC, 3000 Leadenhall Road, Mail Stop LGL, Mt. Laurel, New
      Jersey 08054, Attention: General Counsel, or such other address or telecopy
      number as may be furnished to the Sellers, the Master Servicer and the Trustee
      in writing by the Depositor; (d) in the case of the Master Servicer: PHH
      Mortgage Corporation, 3000 Leadenhall Road, Mail Stop LGL, Mt. Laurel, New
      Jersey 08054, or such other address as maybe furnished to the Sellers, the
      Depositor and the Trustee in writing by the Master Servicer; and (e) in the
      case
      of Fitch, Fitch Ratings, One State Street Plaza, New York, New York 10004.
      Any
      notice required or permitted to be mailed to a Certificateholder shall be given
      by first class mail, postage prepaid, at the address of such Holder as shown
      in
      the Certificate Register. Notice of any Master Servicer Default shall be given
      by telecopy and by certified mail. Any notice so mailed within the time
      prescribed in this Agreement shall be conclusively presumed to have duly been
      given when mailed, whether or not the Certificateholder receives such notice.
      A
      copy of any notice required to be telecopied hereunder shall also be mailed
      to
      the appropriate party in the manner set forth above.

     

    Section
      12.06 Severability
      of Provisions.

     

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

     

    Section
      12.07 Article
      and Section References.

     

    All
      article and section references used in this Agreement, unless otherwise
      provided, are to articles and sections in this Agreement.

     

    Section
      12.08 Notice
      to
      the Rating Agency.

     

    (a) Each
      of
      the Trustee and the Master Servicer shall be obligated to use its best
      reasonable efforts promptly to provide notice to the Rating Agency with respect
      to each of the following of which a Responsible Officer of the Trustee or Master
      Servicer, as the case may be, has actual knowledge:

     

    (i) any
      material change or amendment to this Agreement;

     

    (ii) the
      occurrence of any Master Servicer Event of Termination that has not been cured
      or waived;

     

    (iii) the
      resignation or termination of the Master Servicer or the Trustee;

     

    (iv) the
      final
      payment to Holders of the Certificates of any Class;

     

    (v) any
      change in the location of any Account; and

     

    (vi) if
      the
      Trustee is acting as successor master servicer pursuant to Section 7.02 hereof,
      any event that would result in the inability of the Trustee to make
      Advances.

     

    (b) In
      addition, (i) the Trustee shall promptly furnish to the Rating Agency copies
      of
      each Statement to Certificateholders described in Section 4.06 hereof;
      and

     

    (i) the
      Master Servicer shall promptly furnish to the Rating Agency copies of the
      following:

     

    (A) each
      annual statement as to compliance described in Section 3.19 hereof;

     

    (B) each
      annual independent public accountants’ servicing report described in Section
      3.20 hereof; and

     

    (C) each
      notice delivered pursuant to Section 7.01 (a) hereof which relates to the fact
      that the Master Servicer has not made an Advance.

     

    Any
      such
      notice pursuant to this Section 11.08 shall be in writing and shall be deemed
      to
      have been duly given if personally delivered or mailed by first class mail,
      postage prepaid, or by express delivery service to Fitch Ratings, One State
      Street Plaza, New York, New York 10004.

     

    Section
      12.09 Further
      Assurances.

     

    Notwithstanding
      any other provision of this Agreement, neither the Regular Certificateholders
      nor the Trustee shall have any obligation to consent to any amendment or
      modification of this Agreement unless they have been provided reasonable
      security or indemnity against their out-of-pocket expenses (including reasonable
      attorneys’ fees) to be incurred in connection therewith.

     

    Section
      12.10 Benefits
      of Agreement.

     

    Nothing
      in this Agreement or in the Certificates, expressed or implied, shall give
      to
      any Person, other than the Certificateholders and the parties hereto and their
      successors hereunder, any benefit or any legal or equitable right, remedy or
      claim under this Agreement.

     

    Section
      12.11 Acts
      of
      Certificateholders.

     

    (a) Any
      request, demand, authorization, direction, notice, consent, waiver or other
      action provided by this Agreement to be given or taken by the Certificateholders
      may be embodied in and evidenced by one or more instruments of substantially
      similar tenor signed by such Certificateholders in person or by agent duly
      appointed in writing; and such action shall become effective when such
      instrument or instruments are delivered to the Trustee and the Master Servicer.
      Such instrument or instruments (and the action embodied therein and evidenced
      thereby) are herein sometimes referred to as the “act” of the Certificateholders
      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 Agreement and conclusive in favor of the Trustee and the Trust,
      if made in the manner provided in this Section 12.11.

     

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

     

    (c) Any
      request, demand, authorization, direction, notice, consent, waiver or other
      action by any Certificateholder shall bind every future Holder of such
      Certificate and the Holder of every Certificate issued upon the registration
      of
      transfer thereof or in exchange therefor or in lieu thereof, in respect of
      anything done, omitted or suffered to be done by the Trustee or the Trust in
      reliance thereon, whether or not notation of such action is made upon such
      Certificate.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

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

     

    
      	 	 	 	 	 	 	 	
              PHH
                MORTGAGE CAPITAL LLC, as Depositor

            
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
              By:

            	
              /s/
                Richard Bradfield

            
	 	 	 	 	 	 	 	 	
              Name: Richard
                J. Bradfield

            
	 	 	 	 	 	 	 	 	
              Title: Senior
                Vice President

            
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
              PHH
                MORTGAGE CORPORATION, as Master Servicer

            
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
              By:

            	
              /s/
                Richard Bradfield

            
	 	 	 	 	 	 	 	 	
              Name: Richard
                J. Bradfield

            
	 	 	 	 	 	 	 	 	
              Title: Senior
                Vice President

            
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
              CITIBANK
                N.A., as Trustee

            
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
              By:

            	
              /s/
                Kristen Driscoll

            
	 	 	 	 	 	 	 	 	
              Name: Kristen
                Driscoll

            
	 	 	 	 	 	 	 	 	
              Title: Vice
                President

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    
      	
              STATE
                OF NEW JERSEY

            	
              )

            	 
	 	
              )

            	
              ss.:

            
	
              COUNTY
                OF BURLINGTON

            	
              )

            	 

    

    

    On
      the
      __th
      day of
      ______________ before me, a notary public in and for said State, personally
      appeared Richard J. Bradfield known to me to be a Senior Vice President of
      PHH
      Mortgage Capital LLC, a Delaware limited liability company that executed the
      within instrument, and also known to me to be the person who executed it on
      behalf of said limited liability company, and acknowledged to me that such
      limited liability company executed the within instrument.

     

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

     

    

     

    
      	 	 
	 	
              Notary
                Public

            

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    
      	
              STATE
                OF NEW JERSEY

            	
              )

            	 
	 	
              )

            	
              ss.:

            
	
              COUNTY
                OF BURLINGTON

            	
              )

            	 

    

    

     

    On
      the
      __th
      day of
      ______________ before me, a notary public in and for said State, personally
      appeared Richard J. Bradfield known to me to be a Senior Vice President of
      PHH
      Mortgage Corporation, a New Jersey corporation, that executed the within
      instrument, and also known to me to be the person who executed it on behalf
      of
      said limited liability company, and acknowledged to me that such limited
      liability company executed the within instrument.

     

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

     

    

     

    
      	 	 
	 	
              Notary
                Public

            

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    
      	
              STATE
                OF NEW YORK

            	
              )

            	 
	 	
              )

            	
              ss.:

            
	
              COUNTY
                OF NEW YORK

            	
              )

            	 

    

    

     

    On
      the
      __th
      day of
      ______________ before me, a notary public in and for said State, personally
      appeared ______________ known to me to be a Vice President of ______________,
      a
      corporation that executed the within instrument, and also known to me to be
      the
      person who executed it on behalf of said limited liability company, and
      acknowledged to me that such limited liability company executed the within
      instrument.

     

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

     

    

     

    
      	 	 
	 	
              Notary
                Public

            

    

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
       

      
 

      EXHIBIT
        A

       

      FORM
        OF
        CLASS A CERTIFICATE

       

      SOLELY
        FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT”, AS THOSE TERMS ARE DEFINED,
        RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
        (THE “CODE”).

       

      UNLESS
        THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO ISSUER OR ITS AGENT FOR
        REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE 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.

       

      [[FOR
        CLASS A-6, CLASS A-7 AND CLASS A-8 CERTIFICATES ONLY:] NO TRANSFER OF THIS
        CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT (EACH
        A
“PLAN”) SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
        AMENDED (“ERISA”), OR THE CODE WILL BE REGISTERED EXCEPT IN ACCORDANCE WITH
        SECTION 5.02(E) OF THE AGREEMENT.]

       

      [[FOR
        CLASS A-6, CLASS A-7 AND CLASS A-8 CERTIFICATES ONLY:] NOTWITHSTANDING THE
        PREVIOUS PARAGRAPH, A CERTIFICATION WILL NOT BE REQUIRED WITH RESPECT TO
        THE
        TRANSFER OF THIS CERTIFICATE TO A DEPOSITORY, OR FOR ANY SUBSEQUENT TRANSFER
        OF
        THIS CERTIFICATE FOR SO LONG AS THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE.
        ANY TRANSFEREE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE REPRESENTED BY
        VIRTUE
        OF ITS PURCHASE OR HOLDING OF THIS CERTIFICATE (OR INTEREST HEREIN) THAT
        SUCH
        TRANSFEREE IS EITHER (I) NOT A PLAN INVESTOR OR (II) AN “ACCREDITED INVESTOR”
WITHIN THE MEANING OF RULE 501(A) PROMULGATED PURSUANT TO THE 1933
        ACT.]

       

      [[FOR
        CLASS A-6, CLASS A-7 AND CLASS A-8 CERTIFICATES ONLY:] 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 THAT ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER
        APPLICABLE STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS
        OF
        SECTION 5.02(D) OF THE AGREEMENT.]

       

      [[FOR
        CLASS A-6, CLASS A-7 AND CLASS A-8 CERTIFICATES ONLY:] NOTWITHSTANDING THE
        PREVIOUS PARAGRAPH, A CERTIFICATION WILL NOT BE REQUIRED WITH RESPECT TO
        THE
        TRANSFER OF THIS CERTIFICATE TO A DEPOSITORY, OR FOR ANY SUBSEQUENT TRANSFER
        OF
        THIS CERTIFICATE FOR SO LONG AS THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE.
        ANY TRANSFEREE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE REPRESENTED BY
        VIRTUE
        OF ITS PURCHASE OR HOLDING OF THIS CERTIFICATE (OR INTEREST HEREIN) THAT
        SUCH
        TRANSFEREE IS A “QUALIFIED INSTITUTIONAL BUYER” WITHIN THE MEANING OF RULE 144A
        UNDER THE 1933 ACT.]

      
 

      
        	
                PHHMC
                  Mortgage Pass-Through

                Certificates,
                  Series 2006-3, Class A-__

                 

                Pass-Through
                  Rate:

                [Variable][__%
                  per annum]

              	
                [Aggregate
                  Certificate Principal

                Balance][Aggregate
                  Notional Amount] of 

                Class
                  A-__ Certificates as of the Issue Date: 

                $______________

                 

              
	
                 

                Date
                  of Agreement and Cut-off Date:

                September
                  1, 2006 

              	
                [Denomination][Notional
                  Amount]:

                $______________

                 

              
	 	
                Master
                  Servicer:

                PHH
                  Mortgage Corporation

              
	
                First
                  Distribution Date: October 18, 2006

              	
                Trustee:
                  Citibank, N.A.

              
	 	
                Issue
                  Date: September 28, 2006

              
	
                No.
                  _

              	
                CUSIP:
                  ___________

              

      

      

      [DISTRIBUTIONS
        IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY
        BE
        MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
        PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE
        AS
        THE DENOMINATION OF THIS CERTIFICATE.]

       

      MORTGAGE
        PASS-THROUGH CERTIFICATE

       

      evidencing
        a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
        primarily of a pool of conventional, one- to four-family, fixed-rate, first
        lien
        mortgage loans (the “Mortgage Loans”) formed and sold by

       

      PHH
        MORTGAGE CAPITAL LLC

       

      PHHMC
        MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-3

       

      THIS
        CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN PHH MORTGAGE
        CAPITAL LLC, THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE
        AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
        GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.

       

      This
        certifies that __________ is the registered owner of a Percentage Interest
        (obtained by dividing the [denomination][Notional Amount] of this Certificate
        by
        the aggregate [Certificate Principal Balance][Notional Amount] of the Class
        A-_
        Certificates as of the Issue Date) in that certain beneficial ownership interest
        evidenced by all the Class A-_ Certificates in the Trust Fund created pursuant
        to a Pooling and Servicing Agreement, dated as specified above (the
“Agreement”), among PHH Mortgage Capital LLC (hereinafter called the
“Depositor,” which term includes any successor entity under the Agreement), the
        Master Servicer and the Trustee, a summary of certain of the pertinent
        provisions of which is set forth hereafter. To the extent not defined herein,
        the capitalized terms used herein have the meanings assigned in the 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.

       

      Pursuant
        to the terms of the Agreement, distributions will be made on the 18th day
        of
        each month or, if such 18th day is not a Business Day, the Business Day
        immediately following (a “Distribution Date”), commencing on the First
        Distribution Date specified above, to the Person in whose name this Certificate
        is registered on the Record Date, in an amount equal to the product of the
        Percentage Interest evidenced by this Certificate and the amount required
        to be
        distributed to the Holders of Class A-_ Certificates on such Distribution
        Date
        pursuant to the Agreement.

       

      All
        distributions to the Holder of this Certificate under the Agreement will
        be made
        or caused to be made by or on behalf of the Trustee by wire transfer in
        immediately available funds to the account of the Person entitled thereto
        if
        such Person shall have so notified the Trustee in writing at least five Business
        Days prior to the Record Date immediately prior to such Distribution Date
        and is
        the registered owner of Class A-_ Certificates, the aggregate initial
        Certificate Principal Balance of which is in excess of the lesser of (i)
        $5,000,000 or (ii) two-thirds of the aggregate initial [Certificate Principal
        Balance][Notional Amount] of the Class A-_ Certificates, or otherwise by
        check
        mailed by first class mail to the address of the Person entitled thereto,
        as
        such name and address shall appear on the Certificate Register. Notwithstanding
        the above, the final distribution on this Certificate will be made after
        due
        notice by the Trustee of the pendency of such distribution and only upon
        the
        presentation and surrender of this Certificate at the office or agency appointed
        by the Trustee for that purpose as provided in the Agreement.

       

      This
        Certificate is one of a duly authorized issue of Certificates designated
        as
        Mortgage Pass-Through Certificates of the Series specified on the face hereof
        (hereinafter called the “Certificates”) and representing a Percentage Interest
        in the Class of Certificates specified on the face hereof equal to the
        [denomination][Notional Amount] specified on the face hereof divided by the
        aggregate [Certificate Principal Balance][Notional Amount] of the Class of
        Certificates specified on the face hereof.

       

      The
        Certificates are limited in right of payment to certain collections and
        recoveries respecting the related Mortgage Loans, all as more specifically
        set
        forth herein and in the Agreement. As provided in the Agreement, withdrawals
        from the Collection Account and the Distribution Account may be made from
        time
        to time for purposes other than distributions to Holders of the Certificates,
        such purposes including reimbursement of advances made, or certain expenses
        incurred, with respect to the Mortgage Loans.

       

      The
        Agreement permits, with certain exceptions and conditions provided therein,
        the
        amendment thereof and the modification of the rights and obligations of the
        Depositor, the Master Servicer and the Trustee and the rights of the Holders
        of
        the Certificates under the Agreement at any time by the Depositor, the Master
        Servicer and the Trustee, with the consent of the Holders of Certificates
        entitled to at least 66%, in some cases 100%, of the Voting Rights. Any such
        consent by the Holder of this Certificate shall be conclusive and binding
        on
        such Holder and upon all future Holders of this Certificate and of any
        Certificate issued upon the transfer hereof or in exchange herefor or in
        lieu
        hereof whether or not notation of such consent is made upon this Certificate.
        The Agreement also permits the amendment thereof, in certain limited
        circumstances, without the consent of the Holders of any of the
        Certificates.

       

      As
        provided in the Agreement and subject to certain limitations set forth therein,
        the transfer of this Certificate is registrable in the Certificate Register
        upon
        surrender of this Certificate for registration of transfer at the offices
        or
        agencies appointed by the Trustee as provided in the Agreement, duly endorsed
        by, or accompanied by an assignment in the form below or other written
        instrument of transfer in form satisfactory to the Trustee and 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 the
        same
        Class in authorized denominations evidencing the same aggregate Percentage
        Interest will be issued to the designated transferee or
        transferees.

       

      The
        Certificates are issuable in fully registered form only without coupons in
        Classes and denominations representing Percentage Interests specified in
        the
        Agreement. As provided in the Agreement and subject to certain limitations
        set
        forth therein, Certificates are exchangeable for new Certificates of the
        same
        Class in authorized denominations evidencing the same aggregate Percentage
        Interest, as requested by the Holder surrendering the same.

       

      [[For
        Class A-6, Class A-7 and Class A-8 Certificates Only:] No transfer of this
        Certificate shall be made unless the transfer is made pursuant to an effective
        registration statement under the Securities Act of 1933, as amended (the
“1933
        Act”), and an effective registration or qualification under applicable state
        securities laws, or is made in a transaction that does not require such
        registration or qualification. In the event that such a transfer of this
        Certificate is to be made without registration or qualification, (i) if such
        transfer is made in reliance upon Rule 144A under the 1933 Act, the Trustee
        shall require the transferor to execute a transferor certificate in
        substantially the same form attached to the Agreement as Exhibit F-2 and
        the
        transferee to execute an investment letter in substantially the form attached
        to
        the Agreement as Exhibit F-1 or (ii) (A) the Trustee shall require the
        transferor to execute a transferor certificate (in substantially the form
        attached to the Agreement as Exhibit F-2) and the transferee to execute an
        investment letter (in substantially the form attached to the Agreement as
        Exhibit F-3) acceptable to and in form and substance reasonably satisfactory
        to
        the Depositor and the Trustee certifying to the Depositor and the Trustee
        the
        facts surrounding such transfer, which investment letter shall not be an
        expense
        of the Trustee or the Depositor and (B) the Trustee and the Depositor shall
        require a written Opinion of Counsel (which may be in-house counsel) acceptable
        to and in form and substance reasonably satisfactory to the Trustee and the
        Depositor that such transfer may be made pursuant to an exemption, describing
        the applicable exemption and the basis therefor, from the 1933 Act or is
        being
        made pursuant to the 1933 Act, which Opinion of Counsel shall not be an expense
        of the Trustee or the Depositor. None of the Depositor, the Certificate
        Registrar or the Trustee is obligated to register or qualify the Class of
        Certificates specified on the face hereof under the 1933 Act or any other
        securities law or to take any action not otherwise required under the Agreement
        to permit the transfer of such Certificates without registration or
        qualification. Any Holder desiring to effect a transfer of this Certificate
        shall be required to indemnify the Trustee, the Depositor, the Certificate
        Registrar and the Master Servicer 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.]

       

      [[For
        Class A-6, Class A-7 and Class A-8 Certificates Only:] No transfer of this
        Certificate to a Plan subject to ERISA or Section 4975 of the Code, any Person
        acting, directly or indirectly, on behalf of any such Plan or any person
        using
        Plan Assets to acquire this Certificate shall be made except in accordance
        with
        Section 5.02(e) of the Agreement.]

       

      [[For
        Class A-6, Class A-7 and Class A-8 Certificates Only:] Notwithstanding the
        foregoing, the certifications described in the previous two paragraphs will
        not
        be required with respect to the transfer of this Certificate to a Depository,
        or
        for any subsequent transfer of this Certificate for so long as this Certificate
        is a Book-Entry Certificate. Any Transferee of this Certificate will be deemed
        to have represented by virtue of its purchase or holding of this Certificate
        (or
        interest herein) that (i) either (a) such Transferee is not a Plan Investor
        or
        (b) such Transferee is an “accredited investor” within the meaning of Rule
        501(a) promulgated pursuant to the 1933 Act and (ii) such Transferee is a
        “qualified institutional buyer” within the meaning of Rule 144A under the 1933
        Act.]

       

      No
        service charge will be made for any such registration of transfer or exchange
        of
        Certificates, but the Certificate Registrar may require payment of a sum
        sufficient to cover any tax or other governmental charge that may be imposed
        in
        connection with any transfer or exchange of Certificates.

       

      The
        Depositor, the Master Servicer, the Trustee and the Certificate Registrar
        and
        any agent of the Depositor, the Master Servicer, the Trustee 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 Depositor, the Master
        Servicer, the Trustee, the Certificate Registrar nor any such agent shall
        be
        affected by notice to the contrary.

       

      The
        obligations created by the Agreement and the Trust Fund created thereby shall
        terminate upon payment (or provision for payment) to the Holders of the
        Certificates of all amounts held by or on behalf of the Trustee and required
        to
        be paid to them pursuant to the Agreement following the earlier of (i) the
        Distribution Date on which the Certificate Principal Balance of each Class
        of
        Certificates has been reduced to zero, (ii) the final payment (or any advance
        with respect thereto) on or other liquidation of the last Mortgage Loan
        remaining in the Trust Fund and (iii) the optional purchase by the party
        designated in the Agreement at a price determined as provided in the Agreement
        from the Trust Fund of all the Mortgage Loans and all property acquired in
        respect of such Mortgage Loans remaining therein. The Agreement permits,
        but
        does not require, the party designated in the Agreement to purchase from
        the
        Trust Fund all the related Mortgage Loans and all property acquired in respect
        of any related Mortgage Loan remaining therein at a price determined as provided
        in the Agreement. The exercise of such right will effect early retirement
        of the
        Certificates; however, such right to purchase is subject to the aggregate
        Loan
        Balance of the related Mortgage Loans at the time of purchase being less
        than
        10% of the aggregate principal balance of the related Mortgage Loans as of
        the
        Cut-off Date.

       

      The
        recitals contained herein shall be taken as statements of the Depositor and
        the
        Trustee assumes no responsibility for their correctness.

       

      Unless
        the certificate of authentication hereon has been executed by the Certificate
        Registrar, by manual signature, this Certificate shall not be entitled to
        any
        benefit under the Agreement or be valid for any purpose.

       

      IN
        WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
        executed.

       

      Dated:
        September 28, 2006

       

      
        	 	 	 
	 	
                CITIBANK,
                  N.A.

                as
                  Trustee

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                

              
	 	
                Authorized
                  Officer

              

      

      
 

       

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        is
        one of the Class A-_ Certificates referred to in the within-mentioned
        Agreement.

      
        	 	 	 
	 	
                CITIBANK,
                  N.A.

                as
                  Certificate Registrar

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                

              
	 	
                Authorized
                  Signatory

              

      

       

       

       

      ABBREVIATIONS

       

      The
        following abbreviations, when used in the inscription on the face of this
        instrument, shall be construed as though they were written out in full according
        to applicable laws or regulations:

       

      
        	
                TEN
                  COM -

              	 	
                as
                  tenants in common

              	 	
                UNIF
                  GIFT MIN ACT -

              	 	
                CUSTODIAN

              
	
                TEN
                  ENT -

              	 	
                as
                  tenants by the entireties

              	 	 	 	
                (Cust) 
                  (Minor)

              
	 	 	 	 	 	 	
                under
                  Uniform Gifts to

                Minors
                  Act

              
	
                JT
                  TEN -

              	 	
                as
                  joint tenants with right of survivorship and not as tenants in
                  common

              	 	 	 	
                ______________

                (State)

              

      

      

       

      Additional
        abbreviations may also be used though not in the above list.

       

       

      ASSIGNMENT

       

      FOR
        VALUE
        RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
        

      
        	 

      

      
        	
                .

              

      

      (Please
        print or typewrite name, address including postal zip code, and Taxpayer
        Identification 

      Number
        of
        assignee)

       

      the
        Percentage Interest evidenced by the within Mortgage Pass-Through Certificate
        and hereby authorize(s) the registration of transfer of such interest to
        assignee on the Certificate Register of the Trust Fund.

       

      I
        (we)
        further direct the Certificate Registrar to issue a new Certificate of a
        like
        Percentage Interest and Class to the above named assignee and deliver such
        Certificate to the following address: 
        
          	 

        

        
          	
                  .

                

        

      

       

       

      
        	
                Dated:

              	 
	
              	
                Signature
                  by or on behalf of assignor

              
	 	 
	 	 
	 	
                Signature
                  Guaranteed

              

      

       

       

      DISTRIBUTION
        INSTRUCTIONS

       

      The
        assignee should include the following for purposes of distribution:

       

      Distributions
        shall be made, by wire transfer or otherwise, in immediately available funds
        

      
        	
                to

              	 	
                ,

              
	
                for
                  the account of

              	 	
                ,

              
	
                account
                  number___________, or, if mailed by check, to

              	 	
                ,

              
	
                Applicable
                  statements should be mailed to

              	 	
                ,

              
	 	
                .

              

      

      

      
        	
                This
                  information is provided by

              	 	
                ,

              
	
                the
                  assignee named above, or

              	 	
                ,

              
	
                as
                  its agent.

              	 	 

      

      

 

      EXHIBIT
        B

       

      [RESERVED]

       

      
 

      EXHIBIT
        C-1

       

      FORM
        OF
        CLASS R CERTIFICATE

       

      THIS
        CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.

       

      SOLELY
        FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “RESIDUAL INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT” (“REMIC”), AS THOSE TERMS ARE
        DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
        CODE OF
        1986 (THE “CODE”).

       

      ANY
        RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
        IN
        ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT REFERRED
        TO
        HEREIN.

       

      NO
        TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
        ARRANGEMENT (EACH A “PLAN”) SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
        ACT OF 1974, AS AMENDED (“ERISA”), OR THE CODE WILL BE REGISTERED EXCEPT IN
        ACCORDANCE WITH SECTION 5.02(E) OF THE AGREEMENT.

       

      ANY
        RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
        IF
        THE PROPOSED TRANSFEREE PROVIDES (I) AN AFFIDAVIT TO THE TRUSTEE THAT (A)
        SUCH
        TRANSFEREE IS NOT (1) THE UNITED STATES OR ANY POSSESSION THEREOF, ANY STATE
        OR
        POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL
        ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING, (2)
        ANY
        ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE)
        THAT IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
        ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE, (3)
        ANY
        ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH PERSON
        DESCRIBED IN THE FOREGOING CLAUSES (1), (2) OR (3) SHALL HEREINAFTER BE REFERRED
        TO AS A “DISQUALIFIED ORGANIZATION”) OR (4) AN AGENT OF A DISQUALIFIED
        ORGANIZATION AND (B) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT
        OR
        COLLECTION OF TAX, AND (II) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL
        CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
        NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF ANY TRANSFER,
        SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION
        OR
        AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED
        TO BE
        OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED
        TO BE
        A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED
        TO,
        THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS
        CERTIFICATE BY ACCEPTANCE HEREOF SHALL BE DEEMED TO HAVE CONSENTED TO THE
        PROVISIONS OF THIS PARAGRAPH AND THE PROVISIONS OF SECTION 5.02(F) OF THE
        AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED ORGANIZATION
        IS
        PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS CERTIFICATE.

      
 

      
        	
                Certificate
                  No. ___

              	 
	
                PHHMC
                  Mortgage Pass-Through 

                Certificates,
                  Series 2006-3, Class R-_

              	
                Percentage
                  Interest: Variable Rate

              
	
                Pass-Through
                  Rate: Variable

                 

              	
                Master
                  Servicer:

                PHH
                  Mortgage Corporation

              
	
                Date
                  of Agreement and Cut-off Date:

                September
                  1, 2006

              	
                Trustee:
                  Citibank, N.A.

                 

              
	
                First
                  Distribution Date: October 18, 2006

              	
                Issue
                  Date: September 28, 2006

              
	
                No.
                  _

              	
                CUSIP:
                  ___________

              

      

      

      MORTGAGE
        PASS-THROUGH CERTIFICATE

       

      evidencing
        a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
        primarily of a pool of conventional, one- to four-family, fixed-rate, first
        lien
        mortgage loans (the “Mortgage Loans”) formed and sold by

       

      PHH
        MORTGAGE CAPITAL LLC

       

      PHHMC
        MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-3

       

      THIS
        CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN PHH MORTGAGE
        CAPITAL LLC, THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE
        AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
        GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.

       

      This
        certifies that ___________________ is the registered owner of a Percentage
        Interest (obtained by dividing the denomination of this Certificate by the
        aggregate Certificate Principal Balance of the Class R-_ Certificates as
        of the
        Issue Date) in that certain beneficial ownership interest evidenced by all
        the
        Class R-_ Certificates in The Trust Fund created pursuant to a Pooling and
        Servicing Agreement, dated as specified above (the “Agreement”), among PHH
        Mortgage Capital LLC (hereinafter called the “Depositor,” which term includes
        any successor entity under the Agreement), the Master Servicer and the Trustee,
        a summary of certain of the pertinent provisions of which is set forth
        hereafter. To the extent not defined herein, the capitalized terms used herein
        have the meanings assigned in the 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.

       

      Pursuant
        to the terms of the Agreement, distributions will be made on the 18th day
        of
        each month or, if such 18th day is not a Business Day, the Business Day
        immediately following (a “Distribution Date”), commencing on the First
        Distribution Date specified above, to the Person in whose name this Certificate
        is registered on the Record Date, in an amount equal to the product of the
        Percentage Interest evidenced by this Certificate and the amount required
        to be
        distributed to the Holders of Class R-_ Certificates on such Distribution
        Date
        pursuant to the Agreement.

       

      This
        Certificate is one of a duly authorized issue of Certificates designated
        as
        Mortgage Pass-Through Certificates of the Series specified on the face hereof
        (hereinafter called the “Certificates”) and representing a Percentage Interest
        in the Class of Certificates specified on the face hereof equal to the
        denomination specified on the face hereof divided by the aggregate Certificate
        Principal Balance of the Class of Certificates specified on the face
        hereof.

       

      The
        Certificates are limited in right of payment to certain collections and
        recoveries respecting the Mortgage Loans, all as more specifically set forth
        herein and in the Agreement. As provided in the Agreement, withdrawals from
        the
        Collection Account and the Distribution Account may be made from time to
        time
        for purposes other than distributions to Holders of the Certificates, such
        purposes including reimbursement of advances made, or certain expenses incurred,
        with respect to the Mortgage Loans.

       

      The
        Agreement permits, with certain exceptions and conditions provided therein,
        the
        amendment thereof and the modification of the rights and obligations of the
        Depositor, the Master Servicer and the Trustee and the rights of the Holders
        of
        the Certificates under the Agreement at any time by the Depositor, the Master
        Servicer and the Trustee, with the consent of the Holders of Certificates
        entitled to at least 66%, in some cases 100%, of the Voting Rights. Any such
        consent by the Holder of this Certificate shall be conclusive and binding
        on
        such Holder and upon all future Holders of this Certificate and of any
        Certificate issued upon the transfer hereof or in exchange herefor or in
        lieu
        hereof whether or not notation of such consent is made upon this Certificate.
        The Agreement also permits the amendment thereof, in certain limited
        circumstances, without the consent of the Holders of any of the
        Certificates.

       

      As
        provided in the Agreement and subject to certain limitations set forth therein,
        the transfer of this Certificate is registrable in the Certificate Register
        upon
        surrender of this Certificate for registration of transfer at the offices
        or
        agencies appointed by the Trustee as provided in the Agreement, duly endorsed
        by, or accompanied by an assignment in the form below or other written
        instrument of transfer in form satisfactory to the Trustee and 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 the
        same
        Class in authorized denominations evidencing the same aggregate Percentage
        Interest will be issued to the designated transferee or
        transferees.

       

      The
        Certificates are issuable in fully registered form only without coupons in
        Classes and denominations representing Percentage Interests specified in
        the
        Agreement. As provided in the Agreement and subject to certain limitations
        set
        forth therein, Certificates are exchangeable for new Certificates of the
        same
        Class in authorized denominations evidencing the same aggregate Percentage
        Interest, as requested by the Holder surrendering the same.

       

      No
        transfer of this Certificate to a Plan subject to ERISA or Section 4975 of
        the
        Code, any Person acting, directly or indirectly, on behalf of any such Plan
        or
        any person using Plan Assets to acquire this Certificate shall be made except
        in
        accordance with Section 5.02(e) of the Agreement.

       

      Prior
        to
        registration of any transfer, sale or other disposition of this Certificate,
        the
        proposed transferee shall provide to the Trustee (i) an affidavit to the
        effect
        that such transferee is any Person other than a Disqualified Organization
        or the
        agent (including a broker, nominee or middleman) of a Disqualified Organization,
        and (ii) a certificate that acknowledges that (A) the Class R-_ Certificates
        have been designated as a residual interest in a REMIC, (B) it will include
        in
        its income a pro
        rata
        share of
        the net income of the Trust Fund and that such income may be an “excess
        inclusion,” as defined in the Code, that, with certain exceptions, cannot be
        offset by other losses or benefits from any tax exemption, and (C) it expects
        to
        have the financial means to satisfy all of its tax obligations including
        those
        relating to holding the Class R-_ Certificates. Notwithstanding the registration
        in the Certificate Register of any transfer, sale or other disposition of
        this
        Certificate to a Disqualified Organization or an agent (including a broker,
        nominee or middleman) of a Disqualified Organization, such registration shall
        be
        deemed to be of no legal force or effect whatsoever and such Person shall
        not be
        deemed to be a Certificateholder for any purpose, including, but not limited
        to,
        the receipt of distributions in respect of this Certificate.

       

      The
        Holder of this Certificate, by its acceptance hereof, shall be deemed to
        have
        consented to the provisions of Section 5.02 of the Agreement and to any
        amendment of the Agreement deemed necessary by counsel of the Depositor to
        ensure that the transfer of this Certificate to any Person other than a
        Permitted Transferee or any other Person will not cause the Trust Fund to
        cease
        to qualify as a REMIC or cause the imposition of a tax upon the
        REMIC.

       

      No
        service charge will be made for any such registration of transfer or exchange
        of
        Certificates, but the Certificate Registrar may require payment of a sum
        sufficient to cover any tax or other governmental charge that may be imposed
        in
        connection with any transfer or exchange of Certificates.

       

      The
        Depositor, the Master Servicer, the Trustee and the Certificate Registrar
        and
        any agent of the Depositor, the Master Servicer, the Trustee 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 Depositor, the Master
        Servicer, the Trustee, the Certificate Registrar nor any such agent shall
        be
        affected by notice to the contrary.

       

      The
        obligations created by the Agreement and the Trust Fund created thereby shall
        terminate upon payment (or provision for payment) to the Holders of the
        Certificates of all amounts held by or on behalf of the Trustee and required
        to
        be paid to them pursuant to the Agreement following the earlier of (i) the
        Distribution Date on which the Certificate Principal Balance of each Class
        of
        Certificates has been reduced to zero, (ii) the final payment (or any advance
        with respect thereto) on or other liquidation of the last Mortgage Loan
        remaining in The Trust Fund and (iii) the optional purchase by the party
        designated in the Agreement at a price determined as provided in the Agreement
        from The Trust Fund of all the Mortgage Loans and all property acquired in
        respect of such Mortgage Loans remaining therein. The Agreement permits,
        but
        does not require, the party designated in the Agreement to purchase from
        the
        Trust Fund all the related Mortgage Loans and all property acquired in respect
        of any related Mortgage Loan remaining therein at a price determined as provided
        in the Agreement. The exercise of such right will effect early retirement
        of the
        Certificates; however, such right to purchase is subject to the aggregate
        Loan
        Balance of the related Mortgage Loans at the time of purchase being less
        than
        10% of the aggregate principal balance of the related Mortgage Loans as of
        the
        Cut-off Date.

       

      The
        recitals contained herein shall be taken as statements of the Depositor and
        the
        Trustee assumes no responsibility for their correctness.

       

      Unless
        the certificate of authentication hereon has been executed by the Certificate
        Registrar, by manual signature, this Certificate shall not be entitled to
        any
        benefit under the Agreement or be valid for any purpose.

       

      

      IN
        WITNESS WHEREOF, the Trustee has caused this Certificate to be duly

      executed.

       

      Dated:
        September 28, 2006

       

      
        	 	 	 
	 	
                CITIBANK,
                  N.A.

                as
                  Trustee

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                

              
	 	
                Authorized
                  Officer

              

      

       

       

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        is
        one of the Class R-_ Certificates referred to in the within-mentioned
        Agreement.

      
        	 	 	 
	 	
                CITIBANK,
                  N.A.

                as
                  Certificate Registrar

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                

              
	 	
                Authorized
                  Signatory

              

      

       

       

       

      ABBREVIATIONS

       

      The
        following abbreviations, when used in the inscription on the face of this
        instrument, shall be construed as though they were written out in full according
        to applicable laws or regulations:

       

      
        	
                TEN
                  COM -

              	 	
                as
                  tenants in common

              	 	
                UNIF
                  GIFT MIN ACT -

              	 	
                CUSTODIAN

              
	
                TEN
                  ENT -

              	 	
                as
                  tenants by the entireties

              	 	 	 	
                (Cust)
                  (Minor)

              
	 	 	 	 	 	 	
                under
                  Uniform Gifts to

                Minors
                  Act

              
	
                JT
                  TEN -

              	 	
                as
                  joint tenants with right of survivorship and not as tenants in
                  common

              	 	 	 	
                ______________

                (State)

              

      

       

      Additional
        abbreviations may also be used though not in the above list.

       

       

      ASSIGNMENT

       

      FOR
        VALUE
        RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
        

      
        	 

      

      
        	
                .

              

      

      (Please
        print or typewrite name, address including postal zip code, and
        Taxpayer

       

      Identification
        Number of assignee)

       

      the
        Percentage Interest evidenced by the within Mortgage Pass-Through Certificate
        and hereby authorize(s) the registration of transfer of such interest to
        assignee on the Certificate Register of the Trust Fund.

       

      I
        (we)
        further direct the Certificate Registrar to issue a new Certificate of a
        like
        Percentage Interest and Class to the above named assignee and deliver such
        Certificate to the following address: 
        
          	 

        

        
          	
                  .

                

        

      

       

       

      
        	
                Dated:

              	 
	 	
                Signature
                  by or on behalf of assignor

              
	 	 
	 	 
	 	
                Signature
                  Guaranteed

              

      

       

      
 

      DISTRIBUTION
        INSTRUCTIONS

       

      The
        assignee should include the following for purposes of distribution:

       

      Distributions
        shall be made, by wire transfer or otherwise, in immediately available funds
        

      
        	
                to

              	 	
                ,

              
	
                for
                  the account of

              	 	
                ,

              
	
                account
                  number___________, or, if mailed by check, to

              	 	
                ,

              
	
                Applicable
                  statements should be mailed to

              	 	
                ,

              
	 	
                .

              

      

      

      
        	
                This
                  information is provided by

              	 	
                ,

              
	
                the
                  assignee named above, or

              	 	
                ,

              
	
                as
                  its agent.

              	 	 

      

      
 

       

      EXHIBIT
        C-2

       

      FORM
        OF
        CLASS B CERTIFICATE

       

      SOLELY
        FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT”, AS THOSE TERMS ARE DEFINED,
        RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986
        (THE “CODE”).

       

      [[FOR
        CLASS B-1, CLASS B-2 AND CLASS B-3 CERTIFICATES ONLY:] UNLESS THIS CERTIFICATE
        IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
        A
        NEW YORK CORPORATION (“DTC”), TO ISSUER OR ITS AGENT FOR REGISTRATION OF
        TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE 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.]

       

      THIS
        CERTIFICATE IS SUBORDINATE TO THE SENIOR CERTIFICATES, THE RESIDUAL
        CERTIFICATES, [THE CLASS B-1 CERTIFICATES], [THE CLASS B-2 CERTIFICATES],
        [THE
        CLASS B-3 CERTIFICATES], [THE CLASS B-4 CERTIFICATES] [AND THE CLASS B-5
        CERTIFICATES] TO THE EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO
        HEREIN.

       

      NO
        TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
        ARRANGEMENT (EACH A “PLAN”) SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY
        ACT OF 1974, AS AMENDED (“ERISA”), OR THE CODE WILL BE REGISTERED EXCEPT IN
        ACCORDANCE WITH SECTION 5.02(E) OF THE AGREEMENT.

       

      [[FOR
        CLASS B-1, CLASS B-2 AND CLASS B-3 CERTIFICATES ONLY:] NOTWITHSTANDING THE
        PREVIOUS PARAGRAPH, A CERTIFICATION WILL NOT BE REQUIRED WITH RESPECT TO
        THE
        TRANSFER OF THIS CERTIFICATE TO A DEPOSITORY, OR FOR ANY SUBSEQUENT TRANSFER
        OF
        THIS CERTIFICATE FOR SO LONG AS THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE.
        ANY TRANSFEREE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE REPRESENTED BY
        VIRTUE
        OF ITS PURCHASE OR HOLDING OF THIS CERTIFICATE (OR INTEREST HEREIN) THAT
        SUCH
        TRANSFEREE IS EITHER (I) NOT A PLAN INVESTOR OR (II) AN “ACCREDITED INVESTOR”
WITHIN THE MEANING OF RULE 501(A) PROMULGATED PURSUANT TO THE 1933
        ACT.]

       

      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 THAT ARE EXEMPT FROM REGISTRATION UNDER SUCH
        ACT AND
        UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS
        OF SECTION 5.02(D) OF THE AGREEMENT.

       

      [[FOR
        CLASS B-1, CLASS B-2 AND CLASS B-3 CERTIFICATES ONLY:] NOTWITHSTANDING THE
        PREVIOUS PARAGRAPH, A CERTIFICATION WILL NOT BE REQUIRED WITH RESPECT TO
        THE
        TRANSFER OF THIS CERTIFICATE TO A DEPOSITORY, OR FOR ANY SUBSEQUENT TRANSFER
        OF
        THIS CERTIFICATE FOR SO LONG AS THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE.
        ANY TRANSFEREE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE REPRESENTED BY
        VIRTUE
        OF ITS PURCHASE OR HOLDING OF THIS CERTIFICATE (OR INTEREST HEREIN) THAT
        SUCH
        TRANSFEREE IS A “QUALIFIED INSTITUTIONAL BUYER” WITHIN THE MEANING OF RULE 144A
        UNDER THE 1933 ACT.]

       

       

      
        	
                PHHMC
                  Mortgage Pass-Through 

                Certificates,
                  Series 2006-3, Class B-__

                 

              	
                Aggregate
                  Certificate Principal

                Balance
                  of Class B-__

                Certificates as of the Issue Date:
                  

                $__________

              
	
                Pass-Through
                  Rate: Variable

              	
                Denomination:
                  $__________

              
	
                Date
                  of Agreement and Cut-off Date:

                September
                  1, 2006

              	
                Master
                  Servicer:

                PHH
                  Mortgage Corporation

              
	
                First
                  Distribution Date: October 18, 2006

              	 
	 	
                Trustee:
                  Citibank, N.A.

              
	
                No.
                  1

              	
                Issue
                  Date: September 28, 2006

              
	 	
                CUSIP:
                  ____________

              

      

      

      DISTRIBUTIONS
        IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY
        BE
        MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
        PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE
        AS
        THE DENOMINATION OF THIS CERTIFICATE.

       

      MORTGAGE
        PASS-THROUGH CERTIFICATE

       

      evidencing
        a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
        primarily of a pool of conventional, one- to four-family, fixed-rate, first
        lien
        mortgage loans (the “Mortgage Loans”) formed and sold by

       

      PHH
        MORTGAGE CAPITAL LLC

       

      PHHMC
        MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-3

       

      THIS
        CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN PHH MORTGAGE
        CAPITAL LLC, THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE
        AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE
        GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.

       

      This
        certifies that _______________ is the registered owner of a Percentage Interest
        (obtained by dividing the denomination of this Certificate by the aggregate
        Certificate Principal Balance of the Class B-__ Certificates as of the Issue
        Date) in that certain beneficial ownership interest evidenced by all the
        Class
        B-__ Certificates in the Trust Fund created pursuant to a Pooling and Servicing
        Agreement, dated as specified above (the “Agreement”), among PHH Mortgage
        Capital LLC (hereinafter called the “Depositor,” which term includes any
        successor entity under the Agreement), the Master Servicer and the Trustee,
        a
        summary of certain of the pertinent provisions of which is set forth hereafter.
        To the extent not defined herein, the capitalized terms used herein have
        the
        meanings assigned in the 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.

       

      Pursuant
        to the terms of the Agreement, distributions will be made on the 18th day
        of
        each month or, if such 18th day is not a Business Day, the Business Day
        immediately following (a “Distribution Date”), commencing on the First
        Distribution Date specified above, to the Person in whose name this Certificate
        is registered on the Record Date, in an amount equal to the product of the
        Percentage Interest evidenced by this Certificate and the amount required
        to be
        distributed to the Holders of Class B-__ Certificates on such Distribution
        Date
        pursuant to the Agreement.

       

      All
        distributions to the Holder of this Certificate under the Agreement will
        be made
        or caused to be made by or on behalf of the Trustee by wire transfer in
        immediately available funds to the account of the Person entitled thereto
        if
        such Person shall have so notified the Trustee in writing at least five Business
        Days prior to the Record Date immediately prior to such Distribution Date
        and is
        the registered owner of Class B-__ Certificates, the aggregate initial
        Certificate Principal Balance of which is in excess of the lesser of (i)
        $5,000,000 or (ii) two-thirds of the aggregate initial Certificate Principal
        Balance of the Class B-__ Certificates, or otherwise by check mailed by first
        class mail to the address of the Person entitled thereto, as such name and
        address shall appear on the Certificate Register. Notwithstanding the above,
        the
        final distribution on this Certificate will be made after due notice by the
        Trustee of the pendency of such distribution and only upon the presentation
        and
        surrender of this Certificate at the office or agency appointed by the Trustee
        for that purpose as provided in the Agreement.

       

      This
        Certificate is one of a duly authorized issue of Certificates designated
        as
        Mortgage Pass-Through Certificates of the Series specified on the face hereof
        (hereinafter called the “Certificates”) and representing a Percentage Interest
        in the Class of Certificates specified on the face hereof equal to the
        denomination specified on the face hereof divided by the aggregate Certificate
        Principal Balance of the Class of Certificates specified on the face
        hereof.

       

      The
        Certificates are limited in right of payment to certain collections and
        recoveries respecting the Mortgage Loans, all as more specifically set forth
        herein and in the Agreement. As provided in the Agreement, withdrawals from
        the
        Collection Account and the Distribution Account may be made from time to
        time
        for purposes other than distributions to Holders of the Certificates, such
        purposes including reimbursement of advances made, or certain expenses incurred,
        with respect to the Mortgage Loans.

       

      The
        Agreement permits, with certain exceptions and conditions provided therein,
        the
        amendment thereof and the modification of the rights and obligations of the
        Depositor, the Master Servicer and the Trustee and the rights of the Holders
        of
        the Certificates under the Agreement at any time by the Depositor, the Master
        Servicer and the Trustee, with the consent of the Holders of Certificates
        entitled to at least 66%, in some cases 100%, of the Voting Rights. Any such
        consent by the Holder of this Certificate shall be conclusive and binding
        on
        such Holder and upon all future Holders of this Certificate and of any
        Certificate issued upon the transfer hereof or in exchange herefor or in
        lieu
        hereof whether or not notation of such consent is made upon this Certificate.
        The Agreement also permits the amendment thereof, in certain limited
        circumstances, without the consent of the Holders of any of the
        Certificates.

       

      As
        provided in the Agreement and subject to certain limitations set forth therein,
        the transfer of this Certificate is registrable in the Certificate Register
        upon
        surrender of this Certificate for registration of transfer at the offices
        or
        agencies appointed by the Trustee as provided in the Agreement, duly endorsed
        by, or accompanied by an assignment in the form below or other written
        instrument of transfer in form satisfactory to the Trustee and 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 the
        same
        Class in authorized denominations evidencing the same aggregate Percentage
        Interest will be issued to the designated transferee or
        transferees.

       

      The
        Certificates are issuable in fully registered form only without coupons in
        Classes and denominations representing Percentage Interests specified in
        the
        Agreement. As provided in the Agreement and subject to certain limitations
        set
        forth therein, Certificates are exchangeable for new Certificates of the
        same
        Class in authorized denominations evidencing the same aggregate Percentage
        Interest, as requested by the Holder surrendering the same.

       

      No
        transfer of this Certificate shall be made unless the transfer is made pursuant
        to an effective registration statement under the Securities Act of 1933,
        as
        amended (the “1933 Act”), and an effective registration or qualification under
        applicable state securities laws, or is made in a transaction that does not
        require such registration or qualification. In the event that such a transfer
        of
        this Certificate is to be made without registration or qualification, (i)
        if
        such transfer is made in reliance upon Rule 144A under the 1933 Act, the
        Trustee
        shall require the transferor to execute a transferor certificate in
        substantially the same form attached to the Agreement as Exhibit F-2 and
        the
        transferee to execute an investment letter in substantially the form attached
        to
        the Agreement as Exhibit F-1 or (ii) (A) the Trustee shall require the
        transferor to execute a transferor certificate (in substantially the form
        attached to the Agreement as Exhibit F-2) and the transferee to execute an
        investment letter (in substantially the form attached to the Agreement as
        Exhibit F-3) acceptable to and in form and substance reasonably satisfactory
        to
        the Depositor and the Trustee certifying to the Depositor and the Trustee
        the
        facts surrounding such transfer, which investment letter shall not be an
        expense
        of the Trustee or the Depositor and (B) the Trustee and the Depositor shall
        require a written Opinion of Counsel (which may be in-house counsel) acceptable
        to and in form and substance reasonably satisfactory to the Trustee and the
        Depositor that such transfer may be made pursuant to an exemption, describing
        the applicable exemption and the basis therefor, from the 1933 Act or is
        being
        made pursuant to the 1933 Act, which Opinion of Counsel shall not be an expense
        of the Trustee or the Depositor. None of the Depositor, the Certificate
        Registrar or the Trustee is obligated to register or qualify the Class of
        Certificates specified on the face hereof under the 1933 Act or any other
        securities law or to take any action not otherwise required under the Agreement
        to permit the transfer of such Certificates without registration or
        qualification. Any Holder desiring to effect a transfer of this Certificate
        shall be required to indemnify the Trustee, the Depositor, the Certificate
        Registrar and the Master Servicer 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.

       

      No
        transfer of this Certificate to a Plan subject to ERISA or Section 4975 of
        the
        Code, any Person acting, directly or indirectly, on behalf of any such Plan
        or
        any person using Plan Assets to acquire this Certificate shall be made except
        in
        accordance with Section 5.02(e) of the Agreement.

       

      [[For
        Class B-1, Class B-2 and Class B-3 Certificates Only:] Notwithstanding the
        foregoing, the certifications described in the previous two paragraphs will
        not
        be required with respect to the transfer of this Certificate to a Depository,
        or
        for any subsequent transfer of this Certificate for so long as this Certificate
        is a Book-Entry Certificate. Any Transferee of this Certificate will be deemed
        to have represented by virtue of its purchase or holding of this Certificate
        (or
        interest herein) that (i) either (a) such Transferee is not a Plan Investor
        or
        (b) such Transferee is an “accredited investor” within the meaning of Rule
        501(a) promulgated pursuant to the 1933 Act and (ii) such Transferee is a
        “qualified institutional buyer” within the meaning of Rule 144A under the 1933
        Act.]

       

      No
        service charge will be made for any such registration of transfer or exchange
        of
        Certificates, but the Certificate Registrar may require payment of a sum
        sufficient to cover any tax or other governmental charge that may be imposed
        in
        connection with any transfer or exchange of Certificates.

       

      The
        Depositor, the Master Servicer, the Trustee and the Certificate Registrar
        and
        any agent of the Depositor, the Master Servicer, the Trustee 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 Depositor, the Master
        Servicer, the Trustee, the Certificate Registrar nor any such agent shall
        be
        affected by notice to the contrary.

       

      The
        obligations created by the Agreement and the Trust Fund created thereby shall
        terminate upon payment (or provision for payment) to the Holders of the
        Certificates of all amounts held by or on behalf of the Trustee and required
        to
        be paid to them pursuant to the Agreement following the earlier of (i) the
        Distribution Date on which the Certificate Principal Balance of each Class
        of
        Certificates has been reduced to zero, (ii) the final payment (or any advance
        with respect thereto) on or other liquidation of the last Mortgage Loan
        remaining in The Trust Fund and (iii) the optional purchase by the party
        designated in the Agreement at a price determined as provided in the Agreement
        from The Trust Fund of all the Mortgage Loans and all property acquired in
        respect of such Mortgage Loans remaining therein. The Agreement permits,
        but
        does not require, the party designated in the Agreement to purchase from
        the
        Trust Fund all the related Mortgage Loans and all property acquired in respect
        of any related Mortgage Loan remaining therein at a price determined as provided
        in the Agreement. The exercise of such right will effect early retirement
        of the
        Certificates; however, such right to purchase is subject to the aggregate
        Loan
        Balance of the related Mortgage Loans at the time of purchase being less
        than
        10% of the aggregate principal balance of the related Mortgage Loans as of
        the
        Cut-off Date.

       

      The
        recitals contained herein shall be taken as statements of the Depositor and
        the
        Trustee assumes no responsibility for their correctness.

       

      Unless
        the certificate of authentication hereon has been executed by the Certificate
        Registrar, by manual signature, this Certificate shall not be entitled to
        any
        benefit under the Agreement or be valid for any purpose.

       

      IN
        WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
        executed.

       

      Dated:
        September 28, 2006

       

      
        	 	 	 
	 	
                CITIBANK,
                  N.A.

                as
                  Trustee

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                

              
	 	
                Authorized
                  Officer 

              

      

       

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        is
        one of the Class B-__ Certificates referred to in the within-mentioned
        Agreement.

       

       

      
        	 	 	 
	 	
                CITIBANK,
                  N.A.

                as
                  Certificate Registrar

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                

              
	 	
                Authorized
                  Signatory

              

      ABBREVIATIONS

       

      The
        following abbreviations, when used in the inscription on the face of this
        instrument, shall be construed as though they were written out in full according
        to applicable laws or regulations:

       

      
        	
                TEN
                  COM -

              	 	
                as
                  tenants in common

              	 	
                UNIF
                  GIFT MIN ACT -

              	 	
                CUSTODIAN

              
	
                TEN
                  ENT -

              	 	
                as
                  tenants by the entireties

              	 	 	 	
                (Cust)
                  (Minor)

              
	 	 	 	 	 	 	
                under
                  Uniform Gifts to

                Minors
                  Act

              
	
                JT
                  TEN -

              	 	
                as
                  joint tenants with right of survivorship and not as tenants in
                  common

              	 	 	 	
                ______________

                (State)

              

      

      

       

      Additional
        abbreviations may also be used though not in the above list.

       

      

       

      ASSIGNMENT

       

      FOR
        VALUE
        RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
        

      
        	 

      

      
        	
                .

              

      

      (Please
        print or typewrite name, address including postal zip code, and
        Taxpayer

       

      Identification
        Number of assignee)

       

      the
        Percentage Interest evidenced by the within Mortgage Pass-Through Certificate
        and hereby authorize(s) the registration of transfer of such interest to
        assignee on the Certificate Register of the Trust Fund.

       

      I
        (we)
        further direct the Certificate Registrar to issue a new Certificate of a
        like
        Percentage Interest and Class to the above named assignee and deliver such
        Certificate to the following address: 
        
          	 

        

        
          	
                  .

                

        

      

       

       

      
        	
                Dated:

              	 
	 	
                Signature
                  by or on behalf of assignor

              
	 	 
	 	 
	 	
                Signature
                  Guaranteed

              

      

      
 

      DISTRIBUTION
        INSTRUCTIONS

       

      The
        assignee should include the following for purposes of distribution:

       

      Distributions
        shall be made, by wire transfer or otherwise, in immediately available funds
        

      
        	
                to

              	 	
                ,

              
	
                for
                  the account of

              	 	
                ,

              
	
                account
                  number___________, or, if mailed by check, to

              	 	
                ,

              
	
                Applicable
                  statements should be mailed to

              	 	
                ,

              
	 	
                .

              

      

      

      
        	
                This
                  information is provided by

              	 	
                ,

              
	
                the
                  assignee named above, or

              	 	
                ,

              
	
                as
                  its agent.

              	 	 

      

      

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
 

      EXHIBIT
        D

       

      MORTGAGE
        LOAN SCHEDULE

       

====================================================================================================================================================================================================================================================================================
    LOAN ID              ZIP              OCCUPANCY               PROPERTY TYPE                  ORIGINAL TERM TO MATURITY                 CLOSING DATE                   LOAN TO VALUE AT ORIGINATION                     ELTV / LTV AT ORIGINATION                 GROSS RATE
====================================================================================================================================================================================================================================================================================
      0031486947       21822          O/O                     PUDDT                                                          360                   9/7/2005                                             79.90                                          79.9                   6.960
      0031851918       40515          O/O                     SFD                                                            240                  10/6/2005                                             89.15                                         89.15                   6.830
      0031920382       53045          O/O                     PUDDT                                                          360                 10/27/2005                                             77.61                                         77.61                   6.500
      0032542300       23321          O/O                     SFD                                                            360                  7/26/2006                                             77.82                                         77.82                   6.875
      0033940545       07470          O/O                     SFD                                                            360                  8/11/2006                                             80.00                                           80.                   6.504
      0034946285       07670          O/O                     SFD                                                            360                  8/17/2006                                             68.75                                         68.75                   6.750
      0035070820       60657          O/O                     CONDO                                                          360                  6/22/2006                                             62.01                                         62.01                   6.875
      0035074350       60025          O/O                     SFD                                                            360                  8/15/2006                                             80.00                                           80.                   6.750
      0035075373       60045          O/O                     SFD                                                            360                  8/17/2006                                             80.00                                           80.                   6.625
      0035077437       55126          O/O                     SFD                                                            360                  8/15/2006                                             70.34                                         70.34                   6.625
      0035079862       55419          O/O                     SFD                                                            360                  8/18/2006                                             80.00                                           80.                   6.625
      0035081116       60035          O/O                     SFD                                                            360                  8/24/2006                                             79.95                                         79.95                   6.625
      0035081488       60093          O/O                     SFD                                                            360                  8/25/2006                                             40.65                                         40.65                   6.625
      0035083658       60091          O/O                     SFD                                                            360                  7/13/2006                                             62.26                                         62.26                   6.750
      0035084938       55127          O/O                     SFD                                                            360                  8/29/2006                                             80.00                                           80.                   6.875
      0035087303       55126          O/O                     PUDDT                                                          360                  8/29/2006                                             73.95                                         73.95                   6.750
      0035089101       93314          O/O                     SFD                                                            360                  7/19/2006                                             66.67                                         66.67                   6.625
      0035090695       06880          O/O                     SFD                                                            360                  8/11/2006                                             80.00                                           80.                   7.250
      0035093905       55419          O/O                     SFD                                                            360                  8/18/2006                                             67.34                                         67.34                   6.625
      0035096015       89144          O/O                     PUDDT                                                          360                  7/28/2006                                             80.00                                           80.                   6.875
      0035102433       22314          SEC                     PUDDT                                                          360                  8/25/2006                                             55.33                                         55.33                   6.750
      0035102490       84065          O/O                     SFD                                                            360                  8/16/2006                                             80.00                                           80.                   7.125
      0035102631       55082          O/O                     SFD                                                            360                  8/25/2006                                             78.43                                         78.43                   7.250
      0035360593       08502          O/O                     SFD                                                            360                  6/26/2006                                             51.17                                         51.17                   6.218
      0035363050       20124          O/O                     SFD                                                            360                   8/8/2006                                             58.76                                         58.76                   5.950
      0035514330       06897          O/O                     2UNIT                                                          360                   6/2/2006                                             52.92                                         52.92                   6.875
      0035552017       33160          O/O                     CONDO                                                          300                  8/10/2006                                             95.00                                           95.                   7.375
      0035592021       23435          O/O                     SFD                                                            360                  5/24/2006                                             80.00                                           80.                   6.750
      0035631423       20169          O/O                     PUDDT                                                          360                  7/26/2006                                             80.00                                           80.                   6.275
      0035643428       07960          O/O                     SFD                                                            360                  8/29/2006                                             80.00                                           80.                   7.000
      0035694538       11790          O/O                     SFD                                                            360                   6/7/2006                                             67.96                                         67.96                   6.790
      0035700889       97229          O/O                     PUDDT                                                          360                  8/22/2006                                             74.01                                         74.01                   6.375
      0035712132       04003          SEC                     SFD                                                            360                  8/25/2006                                             80.00                                           80.                   6.750
      0035712975       76248          O/O                     PUDDT                                                          360                  7/21/2006                                             80.00                                           80.                   6.129
      0035717586       08889          O/O                     SFD                                                            360                  7/31/2006                                             80.00                                           80.                   6.750
      0035727510       33076          O/O                     PUDDT                                                          360                  7/31/2006                                             73.53                                         73.53                   6.535
      0035727924       10538          O/O                     SFD                                                            360                  8/22/2006                                             45.49                                         45.49                   6.875
      0035744135       07020          O/O                     CONDO                                                          360                   8/3/2006                                             69.23                                         69.23                   6.750
      0038648093       94553          O/O                     SFD                                                            360                  6/19/2006                                             74.19                                         74.19                   6.875
      0038675294       91765          O/O                     CONDO                                                          360                  6/12/2006                                             80.00                                           80.                   6.875
      0038704904       11050          O/O                     SFD                                                            360                   8/7/2006                                             77.54                                         77.54                   6.790
      0038724837       07920          O/O                     SFD                                                            360                   8/3/2006                                             80.00                                           80.                   6.470
      0038726550       60564          O/O                     SFD                                                            360                  8/11/2006                                             80.00                                           80.                   6.810
      0038732517       60175          O/O                     PUDDT                                                          360                   8/3/2006                                             80.00                                           80.                   6.300
      0038766234       07920          O/O                     SFD                                                            360                   8/7/2006                                             75.81                                         75.81                   7.000
      0038766820       06830          O/O                     CONDO                                                          300                   8/1/2006                                             80.00                                           80.                   7.080
      0038802591       95076          SEC                     SFD                                                            360                  7/27/2006                                             80.00                                           80.                   6.800
      0038807806       27540          O/O                     PUDDT                                                          360                  8/18/2006                                             80.00                                           80.                   6.670
      0038811279       07040          O/O                     SFD                                                            360                  8/21/2006                                             59.28                                         59.28                   6.875
      0038811402       07076          O/O                     SFD                                                            360                  8/16/2006                                             59.39                                         59.39                   6.750
      0038819504       94028          O/O                     SFD                                                            360                  8/16/2006                                             33.59                                         33.59                   6.662
      0038822730       80016          O/O                     PUDDT                                                          360                   8/4/2006                                             80.00                                           80.                   6.505
      0038832697       19061          O/O                     SFD                                                            360                  8/17/2006                                             80.00                                           80.                   6.405
      0038840724       63005          O/O                     PUDDT                                                          360                  8/10/2006                                             80.00                                           80.                   6.425
      0038850632       96740          O/O                     SFD                                                            360                  7/10/2006                                             80.00                                           80.                   7.000
      0038873493       80304          O/O                     SFD                                                            360                  7/25/2006                                             76.57                                         76.57                   6.625
      0038877056       30269          O/O                     PUDDT                                                          360                   8/7/2006                                             80.00                                           80.                   6.750
      0038879359       91355          O/O                     PUDDT                                                          360                  8/23/2006                                             80.00                                           80.                   6.415
      0038882759       94583          O/O                     PUDDT                                                          360                  8/18/2006                                             71.19                                         71.19                   6.278
      0038883088       11768          O/O                     SFD                                                            360                  8/10/2006                                             65.95                                         65.95                   6.750
      0038897815       20774          O/O                     SFD                                                            360                  7/26/2006                                             73.64                                         73.64                   6.625
      0038897971       85045          SEC                     SFD                                                            360                  7/28/2006                                             56.87                                         56.87                   6.750
      0038898615       20904          O/O                     PUDDT                                                          360                  7/26/2006                                             62.00                                           62.                   7.000
      0038900338       33908          SEC                     CONDO                                                          360                  8/17/2006                                             70.48                                         70.48                   7.000
      0038919148       20815          O/O                     SFD                                                            360                   8/9/2006                                             80.00                                           80.                   6.636
      0038925939       07432          O/O                     SFD                                                            360                  8/30/2006                                             80.00                                           80.                   6.875
      0038927562       11788          O/O                     PUDDT                                                          360                   8/3/2006                                             58.82                                         58.82                   7.000
      0038931135       07076          O/O                     SFD                                                            360                  8/31/2006                                             63.58                                         63.58                   6.875
      0038949210       08816          O/O                     SFD                                                            360                  8/11/2006                                             80.00                                           80.                   6.590
      0038967790       30019          O/O                     PUDDT                                                          360                  7/31/2006                                             80.00                                           80.                   6.790
      0038979936       22182          O/O                     PUDDT                                                          360                  8/11/2006                                             80.00                                           80.                   6.325
      0038982534       07924          O/O                     SFD                                                            360                  8/17/2006                                             80.00                                           80.                   6.315
      0038998407       30152          O/O                     PUDDT                                                          360                  7/28/2006                                             80.00                                           80.                   6.055
      0039000443       24083          O/O                     PUDDT                                                          360                  8/21/2006                                             80.00                                           80.                   6.285
      0039004759       60175          O/O                     PUDDT                                                          360                  8/15/2006                                             80.00                                           80.                   6.835
      0039004825       32814          O/O                     PUDDT                                                          360                   8/8/2006                                             80.00                                           80.                   6.875
      0039006481       21042          O/O                     SFD                                                            360                  8/24/2006                                             80.00                                           80.                   7.080
      0039009618       98052          O/O                     PUDDT                                                          360                   8/7/2006                                             80.00                                           80.                   6.250
      0039014345       08527          O/O                     SFD                                                            240                   8/3/2006                                             75.93                                         75.93                   7.170
      0039014816       90275          O/O                     CONDO                                                          360                  8/11/2006                                             72.79                                         72.79                   7.030
      0039017413       60502          O/O                     PUDDT                                                          360                  8/17/2006                                             80.00                                           80.                   6.465
      0039023866       01720          O/O                     SFD                                                            360                  8/28/2006                                             95.00                                           95.                   6.155
      0039026331       85331          O/O                     SFD                                                            360                  7/28/2006                                             52.82                                         52.82                   6.785
      0039027602       22182          O/O                     PUDDT                                                          360                  8/16/2006                                             63.66                                         63.66                   6.275
      0039028519       20158          O/O                     PUDDT                                                          360                  8/18/2006                                             74.05                                         74.05                   6.375
      0039030937       11743          O/O                     SFD                                                            360                  8/16/2006                                             77.87                                         77.87                   6.790
      0039033261       92549          SEC                     SFD                                                            360                  7/31/2006                                             65.52                                         65.52                   6.625
      0039035647       28105          O/O                     PUDDT                                                          360                   8/3/2006                                             80.00                                           80.                   6.625
      0039040126       80304          O/O                     PUDDT                                                          360                  8/11/2006                                             80.00                                           80.                   6.875
      0039051776       06468          O/O                     SFD                                                            360                  8/31/2006                                             76.54                                         76.54                   7.145
      0039052840       77056          O/O                     PUDDT                                                          360                  8/18/2006                                             87.21                                         87.21                   7.000
      0039054754       92503          O/O                     SFD                                                            360                   8/1/2006                                             69.66                                         69.66                   6.375
      0039062427       71106          O/O                     SFD                                                            360                   8/4/2006                                             90.75                                         90.75                   6.750
      0039067442       94025          O/O                     SFD                                                            360                   8/2/2006                                             27.26                                         27.26                   6.625
      0039068499       80550          O/O                     SFD                                                            360                  8/18/2006                                             70.42                                         70.42                   6.250
      0039069778       93304          O/O                     SFD                                                            360                  8/17/2006                                             75.06                                         75.06                   6.875
      0039070289       18940          O/O                     SFD                                                            360                   8/9/2006                                             80.00                                           80.                   6.750
      0039073176       07748          O/O                     SFD                                                            360                  8/29/2006                                             76.03                                         76.03                   6.750
      0039074034       07764          O/O                     SFD                                                            360                  8/22/2006                                             77.50                                          77.5                   6.750
      0039086541       06877          O/O                     SFD                                                            360                  8/15/2006                                             66.39                                         66.39                   6.250
      0039097183       94596          O/O                     PUDAT                                                          360                   8/1/2006                                             80.00                                           80.                   6.625
      0039100532       35243          O/O                     SFD                                                            360                  8/15/2006                                             80.00                                           80.                   6.750
      0039100961       06410          O/O                     SFD                                                            360                  8/30/2006                                             91.89                                         91.89                   6.750
      0039104229       92119          O/O                     SFD                                                            360                   8/4/2006                                             75.00                                           75.                   6.625
      0039104443       92860          O/O                     SFD                                                            360                  8/23/2006                                             51.06                                         51.06                   6.750
      0039105358       95032          INV                     PUDAT                                                          360                   8/1/2006                                             70.00                                           70.                   6.750
      0039122841       89144          O/O                     PUDDT                                                          360                  8/11/2006                                             80.00                                           80.                   6.405
      0039141387       30307          O/O                     SFD                                                            360                  8/17/2006                                             80.00                                           80.                   6.790
      0039155775       32708          O/O                     PUDDT                                                          360                  8/23/2006                                             66.91                                         66.91                   5.750
      0039162334       85259          O/O                     PUDDT                                                          360                   8/4/2006                                             80.00                                           80.                   7.040
      0039202627       60521          O/O                     SFD                                                            360                  8/21/2006                                             74.07                                         74.07                   6.750
      0039219613       98074          O/O                     PUDDT                                                          360                  8/22/2006                                             61.35                                         61.35                   6.125
      0039231345       80220          O/O                     SFD                                                            360                  8/21/2006                                             54.89                                         54.89                   6.750
      0039231709       63367          SEC                     PUDDT                                                          360                  8/21/2006                                             61.04                                         61.04                   7.000
      0039234406       15232          O/O                     SFD                                                            360                  8/23/2006                                             80.00                                           80.                   6.028
      0039238860       53211          O/O                     SFD                                                            360                  8/15/2006                                             70.00                                           70.                   6.743
      0039242722       20147          O/O                     PUDDT                                                          360                  8/14/2006                                             55.07                                         55.07                   5.850
      0039244488       21401          O/O                     SFD                                                            360                  8/23/2006                                             80.00                                           80.                   6.590
      0039254040       07921          O/O                     SFD                                                            360                  8/23/2006                                             54.10                                          54.1                   6.405
      0039256425       56442          SEC                     SFD                                                            360                  8/31/2006                                             46.57                                         46.57                   6.625
      0039282926       22043          O/O                     PUDDT                                                          360                  8/29/2006                                             48.78                                         48.78                   6.750
      0039288337       33305          SEC                     CONDO                                                          360                  8/17/2006                                             80.00                                           80.                   7.125
      0039313499       20169          O/O                     PUDDT                                                          360                  8/28/2006                                             80.00                                           80.                   6.325
      0039369236       20878          O/O                     PUDDT                                                          360                  8/18/2006                                             48.99                                         48.99                   6.545
      0039374285       20871          O/O                     PUDDT                                                          360                  8/24/2006                                             80.00                                           80.                   6.150
      0039392667       06840          O/O                     SFD                                                            360                  8/31/2006                                             77.60                                          77.6                   7.000
      0039393129       75002          O/O                     PUDDT                                                          360                  8/29/2006                                             80.00                                           80.                   6.205
      0039396346       80301          O/O                     PUDDT                                                          360                  8/18/2006                                             80.00                                           80.                   6.625
      0039400205       06776          O/O                     SFD                                                            360                  8/28/2006                                             80.00                                           80.                   6.105
      0039414800       94510          O/O                     SFD                                                            360                  8/24/2006                                             70.55                                         70.55                   6.875
      0039732367       20720          O/O                     PUDDT                                                          360                  7/28/2006                                             80.00                                           80.                   7.375
      0039732953       22554          O/O                     SFD                                                            360                  8/10/2006                                             80.00                                           80.                   6.840
      0039750658       95630          O/O                     PUDDT                                                          360                   8/8/2006                                             80.00                                           80.                   6.875
      0039750997       98077          O/O                     SFD                                                            360                   8/1/2006                                             54.33                                         54.33                   6.328
      0039762349       33647          O/O                     PUDDT                                                          360                  8/16/2006                                             70.26                                         70.26                   6.435
      0039763032       94949          O/O                     PUDDT                                                          360                  7/25/2006                                             74.39                                         74.39                   7.045
      7076442156       45385          O/O                     SFD                                                            360                  6/21/2006                                             90.63                                         90.63                   7.170
      7077803844       97701          O/O                     SFD                                                            360                   6/8/2005                                             56.93                                         56.93                   6.625
      7100009609       93292          O/O                     SFD                                                            360                  5/19/2005                                             59.67                                         59.67                   6.830
      7100068357       85251          O/O                     SFD                                                            360                  4/27/2005                                             80.00                                           80.                   7.170
      7100134167       02482          O/O                     SFD                                                            360                   8/8/2005                                             55.06                                         55.06                   6.845
      7100415434       11579          O/O                     SFD                                                            360                   8/9/2006                                             65.36                                         65.36                   6.125
      7100423180       53189          O/O                     SFD                                                            360                  8/25/2006                                             80.00                                           80.                   7.250
      7100425870       19066          O/O                     SFD                                                            360                   8/8/2006                                             78.61                                         78.61                   6.625
      7100426480       28031          O/O                     PUDDT                                                          360                  7/31/2006                                             80.00                                           80.                   6.790
      7100523385       10706          O/O                     CONDO                                                          360                  8/11/2006                                             71.88                                         71.88                   6.530
      7100535694       45230          O/O                     SFD                                                            360                  7/31/2006                                             80.00                                           80.                   6.858
      7100557482       21601          O/O                     SFD                                                            360                   8/4/2006                                             48.08                                         48.08                   6.705
      7100572333       98236          O/O                     SFD                                                            360                  7/27/2006                                             50.22                                         50.22                   7.000
      7100853410       10028          O/O                     COOP                                                           360                  8/31/2006                                             16.67                                         16.67                   6.850
      7101748817       94552          O/O                     PUDDT                                                          360                  7/27/2006                                             72.40                                          72.4                   7.001
      7101768435       89131          INV                     SFD                                                            360                  8/25/2006                                             78.68                                           50.                   7.170
      7101851223       07722          O/O                     SFD                                                            240                  7/28/2006                                             51.02                                         51.02                   6.661
      7101851421       23452          O/O                     SFD                                                            360                   8/1/2006                                             54.89                                         54.89                   6.840
      7101901713       01913          INV                     SFD                                                            360                  8/10/2006                                             18.41                                         18.41                   7.250
      7101901739       95356          O/O                     SFD                                                            360                  8/17/2006                                             49.39                                         49.39                   7.250
      7101960255       30605          O/O                     SFD                                                            360                  7/31/2006                                             80.00                                           80.                   6.790
      7102012395       33160          SEC                     CONDO                                                          360                   8/8/2006                                             24.37                                         24.37                   6.790
      7102013351       33327          O/O                     PUDDT                                                          360                  7/28/2006                                             73.91                                         73.91                   6.750
      7102157208       34228          INV                     CONDO                                                          360                  8/25/2006                                             49.74                                         49.74                   6.875
      7102157687       19382          INV                     4UNIT                                                          360                  8/31/2006                                            100.00                                           70.                   6.875
      7102158065       19975          SEC                     CONDO                                                          360                   8/7/2006                                            100.00                                           70.                   6.690
      7102158248       97306          O/O                     PUDDT                                                          360                  8/21/2006                                             95.00                                           95.                   6.875
      7102209231       06824          O/O                     SFD                                                            360                  8/14/2006                                             48.92                                         48.92                   6.685
      7102571994       98109          O/O                     SFD                                                            360                  8/14/2006                                             52.85                                         52.85                   6.680
      7102680639       91360          O/O                     SFD                                                            360                  8/14/2006                                             76.17                                         76.17                   6.875
      7102724544       32413          SEC                     PUDDT                                                          360                   8/4/2006                                             41.84                                         41.84                   7.125
      7103182239       33312          O/O                     PUDDT                                                          360                  8/17/2006                                             70.37                                         70.37                   6.750
      7103189937       94010          O/O                     SFD                                                            360                  8/21/2006                                             83.19                                           65.                   6.940
      7103363086       61822          SEC                     PUDDT                                                          360                  8/25/2006                                             80.00                                           80.                   6.920
      7103548587       29492          O/O                     PUDDT                                                          360                  8/23/2006                                             51.11                                         51.11                   6.750
      7103647470       02466          O/O                     SFD                                                            360                  8/31/2006                                             89.52                                           70.                   6.810
      7103679705       95037          O/O                     PUDDT                                                          360                  8/25/2006                                             58.36                                         58.36                   6.875
      7105430487       19002          O/O                     SFD                                                            360                  7/10/2006                                            100.00                                          100.                   6.435
      7109769138       06880          O/O                     SFD                                                            360                  7/14/2006                                             70.00                                           70.                   7.315

====================================================================================================================================================================================================================================================================================
    LOAN ID                 FIRST PAYMENT DATE                   STATED MATURITY DATE                     MONTHLY PAYMENT AT ORIGINATION                          MONTHLY PAYMENT AS OF CUT-OFF DATE                      NEXT DUE DATE                  LOAN AMOUNT ORIGINAL
====================================================================================================================================================================================================================================================================================
      0031486947                            9/1/2006                               8/1/2036                                             $2,863.11                                                    $2,863.11                    10/1/2006                             $432,090.00
      0031851918                            9/1/2006                               8/1/2026                                             $3,615.23                                                    $3,615.23                    10/1/2006                             $472,500.00
      0031920382                            9/1/2006                               8/1/2036                                             $3,286.76                                                    $3,286.76                    10/1/2006                             $520,000.00
      0032542300                            9/1/2006                               8/1/2036                                             $3,941.57                                                    $3,941.57                    10/1/2006                             $600,000.00
      0033940545                           10/1/2006                               9/1/2036                                             $2,984.61                                                    $2,984.61                    10/1/2006                             $472,000.00
      0034946285                           10/1/2006                               9/1/2036                                             $7,134.58                                                    $7,134.58                    10/1/2006                           $1,099,999.00
      0035070820                            8/1/2006                               7/1/2036                                             $4,010.42                                                    $4,010.42                    10/1/2006                             $700,000.00
      0035074350                           10/1/2006                               9/1/2036                                             $4,319.67                                                    $4,319.67                    10/1/2006                             $666,000.00
      0035075373                           10/1/2006                               9/1/2036                                             $4,302.89                                                    $4,302.89                    10/1/2006                             $672,000.00
      0035077437                           10/1/2006                               9/1/2036                                             $3,265.59                                                    $3,265.59                    10/1/2006                             $510,000.00
      0035079862                           10/1/2006                               9/1/2036                                             $2,812.25                                                    $2,812.25                    10/1/2006                             $439,200.00
      0035081116                           10/1/2006                               9/1/2036                                             $4,185.08                                                    $4,185.08                    10/1/2006                             $653,600.00
      0035081488                           10/1/2006                               9/1/2036                                             $3,201.56                                                    $3,201.56                    10/1/2006                             $500,000.00
      0035083658                            9/1/2006                               8/1/2036                                             $5,350.94                                                    $5,350.94                    10/1/2006                             $825,000.00
      0035084938                           10/1/2006                               9/1/2036                                             $2,566.67                                                    $2,566.67                    10/1/2006                             $448,000.00
      0035087303                           10/1/2006                               9/1/2036                                             $2,853.84                                                    $2,853.84                    10/1/2006                             $440,000.00
      0035089101                            9/1/2006                               8/1/2036                                             $2,817.37                                                    $2,817.37                    10/1/2006                             $440,000.00
      0035090695                           10/1/2006                               9/1/2036                                             $6,742.50                                                    $6,742.50                    10/1/2006                           $1,116,000.00
      0035093905                           10/1/2006                               9/1/2036                                             $6,402.79                                                    $6,402.79                    10/1/2006                             $999,950.00
      0035096015                            9/1/2006                               8/1/2036                                             $2,937.79                                                    $2,937.79                    10/1/2006                             $447,200.00
      0035102433                           10/1/2006                               9/1/2036                                             $5,383.37                                                    $5,383.37                    10/1/2006                             $830,000.00
      0035102490                           10/1/2006                               9/1/2036                                             $4,042.32                                                    $4,042.32                    10/1/2006                             $600,000.00
      0035102631                           10/1/2006                               9/1/2036                                             $6,041.36                                                    $6,041.36                    10/1/2006                             $999,950.00
      0035360593                            8/1/2006                               7/1/2036                                             $4,019.33                                                    $4,019.33                    10/1/2006                             $655,000.00
      0035363050                           10/1/2006                               9/1/2036                                             $3,399.14                                                    $3,399.14                    10/1/2006                             $570,000.00
      0035514330                            8/1/2006                               7/1/2036                                             $4,171.50                                                    $4,171.50                    10/1/2006                             $635,000.00
      0035552017                           10/1/2006                               9/1/2031                                             $3,575.83                                                    $3,575.83                    10/1/2006                             $489,250.00
      0035592021                            7/1/2006                               6/1/2036                                             $3,445.36                                                    $3,445.36                    10/1/2006                             $531,200.00
      0035631423                            9/1/2006                               8/1/2036                                             $3,160.81                                                    $3,160.81                    10/1/2006                             $512,000.00
      0035643428                           10/1/2006                               9/1/2036                                             $4,524.06                                                    $4,524.06                    10/1/2006                             $680,000.00
      0035694538                            8/1/2006                               7/1/2036                                             $3,983.11                                                    $3,983.11                    10/1/2006                             $611,600.00
      0035700889                           10/1/2006                               9/1/2036                                             $2,807.42                                                    $2,807.42                    10/1/2006                             $450,000.00
      0035712132                           10/1/2006                               9/1/2036                                             $4,442.38                                                    $4,442.38                    10/1/2006                             $684,920.00
      0035712975                            9/1/2006                               8/1/2036                                             $3,647.22                                                    $3,647.22                    10/1/2006                             $600,000.00
      0035717586                            9/1/2006                               8/1/2036                                             $4,099.14                                                    $4,099.14                    10/1/2006                             $632,000.00
      0035727510                            9/1/2006                               8/1/2036                                             $3,964.83                                                    $3,964.83                    10/1/2006                             $625,000.00
      0035727924                           10/1/2006                               9/1/2036                                             $3,810.19                                                    $3,810.19                    10/1/2006                             $580,000.00
      0035744135                           10/1/2006                               9/1/2036                                             $4,378.04                                                    $4,378.04                    10/1/2006                             $675,000.00
      0038648093                            8/1/2006                               7/1/2036                                             $3,777.34                                                    $3,777.34                    10/1/2006                             $575,000.00
      0038675294                            8/1/2006                               7/1/2036                                             $3,074.43                                                    $3,074.43                    10/1/2006                             $468,000.00
      0038704904                           10/1/2006                               9/1/2036                                             $3,585.19                                                    $3,585.19                    10/1/2006                             $550,500.00
      0038724837                           10/1/2006                               9/1/2036                                             $4,279.62                                                    $4,279.62                    10/1/2006                             $679,200.00
      0038726550                           10/1/2006                               9/1/2036                                             $3,158.55                                                    $3,158.55                    10/1/2006                             $484,000.00
      0038732517                           10/1/2006                               9/1/2036                                             $3,348.95                                                    $3,348.95                    10/1/2006                             $541,049.00
      0038766234                           10/1/2006                               9/1/2036                                             $6,652.36                                                    $6,652.36                    10/1/2006                             $999,900.00
      0038766820                           10/1/2006                               9/1/2031                                             $4,413.73                                                    $4,413.73                    10/1/2006                             $620,000.00
      0038802591                            9/1/2006                               8/1/2036                                             $7,748.01                                                    $7,748.01                    10/1/2006                           $1,188,480.00
      0038807806                           10/1/2006                               9/1/2036                                             $3,087.79                                                    $3,087.79                    10/1/2006                             $480,000.00
      0038811279                           10/1/2006                               9/1/2036                                             $3,777.35                                                    $3,777.35                    10/1/2006                             $575,000.00
      0038811402                           10/1/2006                               9/1/2036                                             $3,794.30                                                    $3,794.30                    10/1/2006                             $585,000.00
      0038819504                           10/1/2006                               9/1/2036                                             $4,820.70                                                    $4,820.70                    10/1/2006                             $750,000.00
      0038822730                           10/1/2006                               9/1/2036                                             $3,566.72                                                    $3,566.72                    10/1/2006                             $564,000.00
      0038832697                           10/1/2006                               9/1/2036                                             $4,291.10                                                    $4,291.10                    10/1/2006                             $685,660.58
      0038840724                           10/1/2006                               9/1/2036                                             $3,491.44                                                    $3,491.44                    10/1/2006                             $556,720.00
      0038850632                            9/1/2006                               8/1/2036                                             $4,784.86                                                    $4,784.86                    10/1/2006                             $719,200.00
      0038873493                            9/1/2006                               8/1/2036                                             $3,284.80                                                    $3,284.80                    10/1/2006                             $513,000.00
      0038877056                           10/1/2006                               9/1/2036                                             $3,372.72                                                    $3,372.72                    10/1/2006                             $520,000.00
      0038879359                           10/1/2006                               9/1/2036                                             $3,182.57                                                    $3,182.57                    10/1/2006                             $508,000.00
      0038882759                           10/1/2006                               9/1/2036                                             $3,952.26                                                    $3,952.26                    10/1/2006                             $640,000.00
      0038883088                           10/1/2006                               9/1/2036                                             $3,956.45                                                    $3,956.45                    10/1/2006                             $610,000.00
      0038897815                            9/1/2006                               8/1/2036                                             $3,819.45                                                    $3,819.45                    10/1/2006                             $596,500.00
      0038897971                            9/1/2006                               8/1/2036                                             $2,806.26                                                    $2,806.26                    10/1/2006                             $432,665.00
      0038898615                            9/1/2006                               8/1/2036                                             $3,073.03                                                    $3,073.03                    10/1/2006                             $461,900.00
      0038900338                           10/1/2006                               9/1/2036                                             $4,923.24                                                    $4,923.24                    10/1/2006                             $740,000.00
      0038919148                           10/1/2006                               9/1/2036                                             $4,718.05                                                    $4,718.05                    10/1/2006                             $736,000.00
      0038925939                           10/1/2006                               9/1/2036                                             $3,337.20                                                    $3,337.20                    10/1/2006                             $508,000.00
      0038927562                           10/1/2006                               9/1/2036                                             $3,326.52                                                    $3,326.52                    10/1/2006                             $500,000.00
      0038931135                           10/1/2006                               9/1/2036                                             $3,613.11                                                    $3,613.11                    10/1/2006                             $550,000.00
      0038949210                           10/1/2006                               9/1/2036                                             $3,266.05                                                    $3,266.05                    10/1/2006                             $511,920.00
      0038967790                            9/1/2006                               8/1/2036                                             $2,844.18                                                    $2,844.18                    10/1/2006                             $436,720.00
      0038979936                           10/1/2006                               9/1/2036                                             $3,475.38                                                    $3,475.38                    10/1/2006                             $560,000.00
      0038982534                           10/1/2006                               9/1/2036                                             $7,538.61                                                    $7,538.61                    10/1/2006                           $1,216,000.00
      0038998407                            9/1/2006                               8/1/2036                                             $3,666.80                                                    $3,666.80                    10/1/2006                             $608,000.00
      0039000443                           10/1/2006                               9/1/2036                                             $2,961.44                                                    $2,961.44                    10/1/2006                             $479,200.00
      0039004759                           10/1/2006                               9/1/2036                                             $3,533.00                                                    $3,533.00                    10/1/2006                             $540,000.00
      0039004825                           10/1/2006                               9/1/2036                                             $3,494.87                                                    $3,494.87                    10/1/2006                             $532,000.00
      0039006481                           10/1/2006                               9/1/2036                                             $3,366.84                                                    $3,366.84                    10/1/2006                             $502,000.00
      0039009618                           10/1/2006                               9/1/2036                                             $3,886.41                                                    $3,886.41                    10/1/2006                             $631,200.00
      0039014345                           10/1/2006                               9/1/2026                                             $4,234.83                                                    $4,234.83                    10/1/2006                             $539,100.00
      0039014816                           10/1/2006                               9/1/2036                                             $3,618.87                                                    $3,618.87                    10/1/2006                             $542,300.00
      0039017413                           10/1/2006                               9/1/2036                                             $2,985.11                                                    $2,985.11                    10/1/2006                             $474,000.00
      0039023866                           10/1/2006                               9/1/2036                                             $3,402.07                                                    $3,402.07                    10/1/2006                             $558,125.00
      0039026331                            9/1/2006                               8/1/2036                                             $3,094.15                                                    $3,094.15                    10/1/2006                             $475,344.87
      0039027602                           10/1/2006                               9/1/2036                                             $3,315.14                                                    $3,315.14                    10/1/2006                             $537,000.00
      0039028519                           10/1/2006                               9/1/2036                                             $3,649.64                                                    $3,649.64                    10/1/2006                             $585,000.00
      0039030937                           10/1/2006                               9/1/2036                                             $3,803.36                                                    $3,803.36                    10/1/2006                             $584,000.00
      0039033261                            9/1/2006                               8/1/2036                                             $3,649.78                                                    $3,649.78                    10/1/2006                             $570,000.00
      0039035647                           10/1/2006                               9/1/2036                                             $2,843.70                                                    $2,843.70                    10/1/2006                             $444,112.00
      0039040126                           10/1/2006                               9/1/2036                                             $3,048.15                                                    $3,048.15                    10/1/2006                             $464,000.00
      0039051776                           10/1/2006                               9/1/2036                                             $4,078.60                                                    $4,078.60                    10/1/2006                             $685,000.00
      0039052840                           10/1/2006                               9/1/2036                                             $4,989.77                                                    $4,989.77                    10/1/2006                             $750,000.00
      0039054754                           10/1/2006                               9/1/2036                                             $3,437.53                                                    $3,437.53                    10/1/2006                             $551,000.00
      0039062427                           10/1/2006                               9/1/2036                                             $2,737.09                                                    $2,737.09                    10/1/2006                             $422,000.00
      0039067442                           10/1/2006                               9/1/2036                                             $3,342.42                                                    $3,342.42                    10/1/2006                             $522,000.00
      0039068499                           10/1/2006                               9/1/2036                                             $3,078.59                                                    $3,078.59                    10/1/2006                             $500,000.00
      0039069778                           10/1/2006                               9/1/2036                                             $3,994.13                                                    $3,994.13                    10/1/2006                             $608,000.00
      0039070289                           10/1/2006                               9/1/2036                                             $3,528.38                                                    $3,528.38                    10/1/2006                             $544,000.00
      0039073176                           10/1/2006                               9/1/2036                                             $3,599.72                                                    $3,599.72                    10/1/2006                             $555,000.00
      0039074034                           10/1/2006                               9/1/2036                                             $3,015.99                                                    $3,015.99                    10/1/2006                             $465,000.00
      0039086541                           10/1/2006                               9/1/2036                                             $4,864.17                                                    $4,864.17                    10/1/2006                             $790,000.00
      0039097183                           10/1/2006                               9/1/2036                                             $3,560.13                                                    $3,560.13                    10/1/2006                             $556,000.00
      0039100532                           10/1/2006                               9/1/2036                                             $3,372.71                                                    $3,372.71                    10/1/2006                             $520,000.00
      0039100961                           10/1/2006                               9/1/2036                                             $3,561.09                                                    $3,561.09                    10/1/2006                             $549,042.75
      0039104229                           10/1/2006                               9/1/2036                                             $3,361.64                                                    $3,361.64                    10/1/2006                             $525,000.00
      0039104443                           10/1/2006                               9/1/2036                                             $2,700.00                                                    $2,700.00                    10/1/2006                             $480,000.00
      0039105358                           10/1/2006                               9/1/2036                                             $3,287.81                                                    $3,287.81                    10/1/2006                             $584,500.00
      0039122841                           10/1/2006                               9/1/2036                                             $4,030.37                                                    $4,030.37                    10/1/2006                             $644,000.00
      0039141387                           10/1/2006                               9/1/2036                                             $4,115.96                                                    $4,115.96                    10/1/2006                             $632,000.00
      0039155775                           10/1/2006                               9/1/2036                                             $2,655.26                                                    $2,655.26                    10/1/2006                             $455,000.00
      0039162334                           10/1/2006                               9/1/2036                                             $3,901.07                                                    $3,901.07                    10/1/2006                             $584,000.00
      0039202627                           10/1/2006                               9/1/2036                                             $3,891.59                                                    $3,891.59                    10/1/2006                             $600,000.00
      0039219613                           10/1/2006                               9/1/2036                                             $6,076.11                                                    $6,076.11                    10/1/2006                           $1,000,000.00
      0039231345                           10/1/2006                               9/1/2036                                             $4,734.77                                                    $4,734.77                    10/1/2006                             $730,000.00
      0039231709                           10/1/2006                               9/1/2036                                             $2,741.67                                                    $2,741.67                    10/1/2006                             $470,000.00
      0039234406                           10/1/2006                               9/1/2036                                             $3,632.17                                                    $3,632.17                    10/1/2006                             $604,000.00
      0039238860                           10/1/2006                               9/1/2036                                             $4,400.83                                                    $4,400.83                    10/1/2006                             $679,000.00
      0039242722                           10/1/2006                               9/1/2036                                             $3,362.67                                                    $3,362.67                    10/1/2006                             $570,000.00
      0039244488                           10/1/2006                               9/1/2036                                             $4,721.19                                                    $4,721.19                    10/1/2006                             $740,000.00
      0039254040                           10/1/2006                               9/1/2036                                             $3,097.88                                                    $3,097.88                    10/1/2006                             $495,000.00
      0039256425                           10/1/2006                               9/1/2036                                             $3,085.43                                                    $3,085.43                    10/1/2006                             $558,870.83
      0039282926                           10/1/2006                               9/1/2036                                             $3,891.59                                                    $3,891.59                    10/1/2006                             $600,000.00
      0039288337                           10/1/2006                               9/1/2036                                             $4,311.80                                                    $4,311.80                    10/1/2006                             $640,000.00
      0039313499                           10/1/2006                               9/1/2036                                             $3,475.38                                                    $3,475.38                    10/1/2006                             $560,000.00
      0039369236                           10/1/2006                               9/1/2036                                             $3,079.90                                                    $3,079.90                    10/1/2006                             $485,000.00
      0039374285                           10/1/2006                               9/1/2036                                             $3,258.16                                                    $3,258.16                    10/1/2006                             $534,800.00
      0039392667                           10/1/2006                               9/1/2036                                            $11,177.09                                                   $11,177.09                    10/1/2006                           $1,680,000.00
      0039393129                           10/1/2006                               9/1/2036                                             $3,475.77                                                    $3,475.77                    10/1/2006                             $567,200.00
      0039396346                           10/1/2006                               9/1/2036                                             $2,740.54                                                    $2,740.54                    10/1/2006                             $428,000.00
      0039400205                           10/1/2006                               9/1/2036                                             $2,685.84                                                    $2,685.84                    10/1/2006                             $442,975.20
      0039414800                           10/1/2006                               9/1/2036                                             $3,935.01                                                    $3,935.01                    10/1/2006                             $599,000.00
      0039732367                            9/1/2006                               8/1/2036                                             $4,376.12                                                    $4,376.12                    10/1/2006                             $633,600.00
      0039732953                           10/1/2006                               9/1/2036                                             $3,299.15                                                    $3,299.15                    10/1/2006                             $504,000.00
      0039750658                           10/1/2006                               9/1/2036                                             $7,423.30                                                    $7,423.30                    10/1/2006                           $1,130,000.00
      0039750997                           10/1/2006                               9/1/2036                                             $3,299.55                                                    $3,299.55                    10/1/2006                             $531,500.00
      0039762349                           10/1/2006                               9/1/2036                                             $3,025.37                                                    $3,025.37                    10/1/2006                             $481,900.00
      0039763032                            9/1/2006                               8/1/2036                                             $4,623.71                                                    $4,623.71                    10/1/2006                             $691,832.30
      7076442156                            8/1/2006                               7/1/2036                                             $3,925.20                                                    $3,925.20                    10/1/2006                             $580,000.00
      7077803844                           10/1/2006                               9/1/2036                                             $5,285.81                                                    $5,285.81                    10/1/2006                             $825,506.00
      7100009609                            9/1/2006                               8/1/2036                                             $3,269.63                                                    $3,269.63                    10/1/2006                             $500,000.00
      7100068357                           10/1/2006                               9/1/2036                                             $3,248.45                                                    $3,248.45                    10/1/2006                             $480,000.00
      7100134167                            9/1/2006                               8/1/2036                                             $4,778.06                                                    $4,778.06                    10/1/2006                             $729,556.76
      7100415434                           10/1/2006                               9/1/2036                                             $4,447.71                                                    $4,447.71                    10/1/2006                             $732,000.00
      7100423180                           10/1/2006                               9/1/2036                                             $2,987.39                                                    $2,987.39                    10/1/2006                             $437,920.00
      7100425870                           10/1/2006                               9/1/2036                                             $2,894.21                                                    $2,894.21                    10/1/2006                             $452,000.00
      7100426480                            9/1/2006                               8/1/2036                                             $3,386.55                                                    $3,386.55                    10/1/2006                             $520,000.00
      7100523385                           10/1/2006                               9/1/2036                                             $5,468.62                                                    $5,468.62                    10/1/2006                             $862,500.00
      7100535694                            9/1/2006                               8/1/2036                                             $4,197.08                                                    $4,197.08                    10/1/2006                             $640,000.00
      7100557482                           10/1/2006                               9/1/2036                                             $3,492.19                                                    $3,492.19                    10/1/2006                             $625,000.00
      7100572333                            9/1/2006                               8/1/2036                                             $4,510.27                                                    $4,510.27                    10/1/2006                             $677,927.58
      7100853410                           10/1/2006                               9/1/2036                                             $4,586.82                                                    $4,586.82                    10/1/2006                             $700,000.00
      7101748817                            9/1/2006                               8/1/2036                                             $6,021.60                                                    $6,021.60                    10/1/2006                             $905,000.00
      7101768435                           10/1/2006                               9/1/2036                                             $1,916.97                                                    $1,916.97                    10/1/2006                             $283,257.00
      7101851223                            9/1/2006                               8/1/2026                                             $3,717.91                                                    $3,717.91                    10/1/2006                             $492,384.21
      7101851421                           10/1/2006                               9/1/2036                                             $6,108.51                                                    $6,108.51                    10/1/2006                             $933,177.99
      7101901713                           10/1/2006                               9/1/2036                                               $313.96                                                      $313.96                    10/1/2006                              $46,023.26
      7101901739                           10/1/2006                               9/1/2036                                             $3,715.02                                                    $3,715.02                    10/1/2006                             $614,900.00
      7101960255                            9/1/2006                               8/1/2036                                             $2,969.75                                                    $2,969.75                    10/1/2006                             $456,000.00
      7102012395                           10/1/2006                               9/1/2036                                             $2,722.27                                                    $2,722.27                    10/1/2006                             $418,000.00
      7102013351                            9/1/2006                               8/1/2036                                             $5,513.09                                                    $5,513.09                    10/1/2006                             $850,000.12
      7102157208                           10/1/2006                               9/1/2036                                             $3,087.57                                                    $3,087.57                    10/1/2006                             $470,000.00
      7102157687                           10/1/2006                               9/1/2036                                             $3,383.19                                                    $3,383.19                    10/1/2006                             $515,000.00
      7102158065                           10/1/2006                               9/1/2036                                             $2,800.86                                                    $2,800.86                    10/1/2006                             $434,500.00
      7102158248                           10/1/2006                               9/1/2036                                             $3,082.73                                                    $3,082.73                    10/1/2006                             $469,263.00
      7102209231                           10/1/2006                               9/1/2036                                             $4,456.13                                                    $4,456.13                    10/1/2006                             $799,903.34
      7102571994                           10/1/2006                               9/1/2036                                             $3,573.29                                                    $3,573.29                    10/1/2006                             $554,900.00
      7102680639                           10/1/2006                               9/1/2036                                             $3,207.39                                                    $3,207.39                    10/1/2006                             $559,835.83
      7102724544                           10/1/2006                               9/1/2036                                             $4,228.32                                                    $4,228.32                    10/1/2006                             $627,609.16
      7103182239                           10/1/2006                               9/1/2036                                             $4,449.95                                                    $4,449.95                    10/1/2006                             $686,087.00
      7103189937                           10/1/2006                               9/1/2036                                            $16,531.95                                                   $16,531.95                    10/1/2006                           $2,500,000.00
      7103363086                           10/1/2006                               9/1/2036                                             $3,167.18                                                    $3,167.18                    10/1/2006                             $479,920.00
      7103548587                           10/1/2006                               9/1/2036                                             $2,587.50                                                    $2,587.50                    10/1/2006                             $460,000.00
      7103647470                           10/1/2006                               9/1/2036                                             $3,055.60                                                    $3,055.60                    10/1/2006                             $468,225.00
      7103679705                           10/1/2006                               9/1/2036                                             $3,642.02                                                    $3,642.02                    10/1/2006                             $554,400.00
      7105430487                            9/1/2006                               8/1/2036                                            $12,555.99                                                   $12,555.99                    10/1/2006                           $2,000,000.00
      7109769138                            9/1/2006                               8/1/2036                                             $8,290.59                                                    $8,290.59                    10/1/2006                           $1,207,500.00

======================================================================================================================================================================================================================================================================================================
    LOAN ID                       UNPAID PRINCIPAL BALANCE AS OF CUT-OFF DATE                      PURPOSE                                  DOC                                 MI FLAG              MI COMPANY                MI CERT               MI COVERAGE                 APPRAISED VALUE
======================================================================================================================================================================================================================================================================================================
      0031486947                                                             $431,733.01        PURCH               Full                                                      N                  XX                                                                                          $540,759
      0031851918                                                             $471,574.08        PURCH               Full                                                      Y                  GEMICO                     3875179340                            12%                        $530,000
      0031920382                                                             $519,150.24        PURCH               Full                                                      N                  XX                                                                                          $670,000
      0032542300                                                             $599,495.93        PURCH               Full                                                      N                  XX                                                                                          $780,000
      0033940545                                                             $472,000.00        PURCH               Full                                                      N                  XX                                                                                          $590,000
      0034946285                                                           $1,099,999.00        PURCH               Full                                                      N                  XX                                                                                        $1,600,000
      0035070820                                                             $700,000.00        CASHO               Full                                                      N                  XX                                                                                        $1,129,000
      0035074350                                                             $666,000.00        PURCH               Full                                                      N                  XX                                                                                          $850,000
      0035075373                                                             $672,000.00        PURCH               Full                                                      N                  XX                                                                                          $840,000
      0035077437                                                             $510,000.00        PURCH               Full                                                      N                  XX                                                                                          $725,000
      0035079862                                                             $439,200.00        PURCH               Reduced - Alt Income Verified Assets                      N                  XX                                                                                          $559,000
      0035081116                                                             $653,600.00        PURCH               Full                                                      N                  XX                                                                                          $820,000
      0035081488                                                             $500,000.00        CASHO               Full                                                      N                  XX                                                                                        $1,230,000
      0035083658                                                             $824,289.69        PURCH               Full                                                      N                  XX                                                                                        $1,325,000
      0035084938                                                             $447,013.70        PURCH               Full                                                      N                  XX                                                                                          $570,000
      0035087303                                                             $440,000.00        PURCH               Full                                                      N                  XX                                                                                          $600,000
      0035089101                                                             $439,611.80        PURCH               Full                                                      N                  XX                                                                                          $690,000
      0035090695                                                           $1,112,319.33        PURCH               Full                                                      N                  XX                                                                                        $1,400,000
      0035093905                                                             $999,950.00        PURCH               Full                                                      N                  XX                                                                                        $1,500,000
      0035096015                                                             $446,824.29        PURCH               Full                                                      N                  XX                                                                                          $560,000
      0035102433                                                             $830,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,500,000
      0035102490                                                             $600,000.00        CASHO               Full                                                      N                  XX                                                                                          $750,000
      0035102631                                                             $999,950.00        PURCH               Full                                                      N                  XX                                                                                        $1,300,000
      0035360593                                                             $653,746.08        PURCH               Full                                                      N                  XX                                                                                        $1,280,000
      0035363050                                                             $570,000.00        PURCH               Full                                                      N                  XX                                                                                          $975,000
      0035514330                                                             $633,929.98        PURCH               Full                                                      N                  XX                                                                                        $1,200,000
      0035552017                                                             $489,250.00        PURCH               Full                                                      Y                  UGI                        10690898                              30%                        $560,000
      0035592021                                                             $529,820.19        PURCH               Full                                                      N                  XX                                                                                          $664,600
      0035631423                                                             $511,516.52        PURCH               Full                                                      N                  XX                                                                                          $665,000
      0035643428                                                             $680,000.00        PURCH               Full                                                      N                  XX                                                                                          $850,000
      0035694538                                                             $610,552.10        CASHO               Full                                                      N                  XX                                                                                          $900,000
      0035700889                                                             $450,000.00        PURCH               Reduced - Alt Income Verified Assets                      N                  XX                                                                                          $608,000
      0035712132                                                             $684,920.00        PURCH               Full                                                      N                  XX                                                                                          $895,000
      0035712975                                                             $599,417.28        PURCH               Reduced - Alt Income Verified Assets                      N                  XX                                                                                          $757,000
      0035717586                                                             $631,455.86        PURCH               Full                                                      N                  XX                                                                                          $791,000
      0035727510                                                             $624,438.82        PURCH               Full                                                      N                  XX                                                                                          $950,000
      0035727924                                                             $580,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,275,000
      0035744135                                                             $675,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,000,000
      0038648093                                                             $569,252.57        PURCH               Full                                                      N                  XX                                                                                          $775,000
      0038675294                                                             $464,202.79        PURCH               Full                                                      N                  XX                                                                                          $585,000
      0038704904                                                             $550,500.00        PURCH               Reduced - Alt Income Verified Assets                      N                  XX                                                                                          $710,000
      0038724837                                                             $679,200.00        PURCH               Full                                                      N                  XX                                                                                          $855,000
      0038726550                                                             $484,000.00        PURCH               Full                                                      N                  XX                                                                                          $610,000
      0038732517                                                             $541,049.00        PURCH               Full                                                      N                  XX                                                                                          $700,000
      0038766234                                                             $999,900.00        CASHO               Full                                                      N                  XX                                                                                        $1,319,000
      0038766820                                                             $620,000.00        PURCH               Full                                                      N                  XX                                                                                          $780,000
      0038802591                                                           $1,187,466.71        PURCH               Full                                                      N                  XX                                                                                        $1,493,000
      0038807806                                                             $480,000.00        PURCH               Full                                                      N                  XX                                                                                          $612,500
      0038811279                                                             $575,000.00        PURCH               Full                                                      N                  XX                                                                                          $970,000
      0038811402                                                             $585,000.00        PURCH               Full                                                      N                  XX                                                                                          $995,000
      0038819504                                                             $750,000.00        REFI                Full                                                      N                  XX                                                                                        $2,233,000
      0038822730                                                             $564,000.00        PURCH               Full                                                      N                  XX                                                                                          $705,000
      0038832697                                                             $685,660.58        PURCH               Full                                                      N                  XX                                                                                          $870,000
      0038840724                                                             $556,720.00        PURCH               Full                                                      N                  XX                                                                                          $696,000
      0038850632                                                             $718,610.47        PURCH               Full                                                      N                  XX                                                                                          $943,000
      0038873493                                                             $512,547.39        REFI                Full                                                      N                  XX                                                                                          $670,000
      0038877056                                                             $520,000.00        PURCH               Full                                                      N                  XX                                                                                          $665,000
      0038879359                                                             $508,000.00        PURCH               Full                                                      N                  XX                                                                                          $635,000
      0038882759                                                             $640,000.00        PURCH               Full                                                      N                  XX                                                                                          $899,000
      0038883088                                                             $610,000.00        PURCH               Full                                                      N                  XX                                                                                          $925,000
      0038897815                                                             $595,973.72        REFI                Full                                                      N                  XX                                                                                          $810,000
      0038897971                                                             $432,292.48        REFI                Full                                                      N                  XX                                                                                          $760,800
      0038898615                                                             $461,521.39        CASHO               Full                                                      N                  XX                                                                                          $745,000
      0038900338                                                             $740,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,075,000
      0038919148                                                             $736,000.00        PURCH               Full                                                      N                  XX                                                                                          $950,000
      0038925939                                                             $508,000.00        PURCH               Full                                                      N                  XX                                                                                          $635,000
      0038927562                                                             $500,000.00        PURCH               Full                                                      N                  XX                                                                                          $850,000
      0038931135                                                             $550,000.00        PURCH               Full                                                      N                  XX                                                                                          $865,000
      0038949210                                                             $511,920.00        PURCH               Full                                                      N                  XX                                                                                          $640,000
      0038967790                                                             $436,346.93        PURCH               Full                                                      N                  XX                                                                                          $555,000
      0038979936                                                             $560,000.00        PURCH               Full                                                      N                  XX                                                                                          $718,000
      0038982534                                                           $1,216,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,575,000
      0038998407                                                             $607,401.07        PURCH               Full                                                      N                  XX                                                                                          $760,000
      0039000443                                                             $479,200.00        PURCH               Full                                                      N                  XX                                                                                          $600,000
      0039004759                                                             $540,000.00        PURCH               Full                                                      N                  XX                                                                                          $680,000
      0039004825                                                             $532,000.00        PURCH               Full                                                      N                  XX                                                                                          $675,000
      0039006481                                                             $502,000.00        PURCH               Full                                                      N                  XX                                                                                          $630,000
      0039009618                                                             $631,200.00        PURCH               Full                                                      N                  XX                                                                                          $789,000
      0039014345                                                             $539,100.00        REFI                Full                                                      N                  XX                                                                                          $710,000
      0039014816                                                             $542,300.00        CASHO               Full                                                      N                  XX                                                                                          $745,000
      0039017413                                                             $474,000.00        PURCH               Full                                                      N                  XX                                                                                          $595,000
      0039023866                                                             $558,125.00        PURCH               Full                                                      Y                  UGI                        10781630                              30%                        $595,000
      0039026331                                                             $474,938.40        CASHO               Full                                                      N                  XX                                                                                          $900,000
      0039027602                                                             $537,000.00        PURCH               Full                                                      N                  XX                                                                                          $845,000
      0039028519                                                             $585,000.00        PURCH               Full                                                      N                  XX                                                                                          $800,000
      0039030937                                                             $584,000.00        PURCH               Full                                                      N                  XX                                                                                          $750,000
      0039033261                                                             $569,497.09        PURCH               Full                                                      N                  XX                                                                                          $870,000
      0039035647                                                             $444,112.00        PURCH               Full                                                      N                  XX                                                                                          $560,000
      0039040126                                                             $464,000.00        PURCH               Full                                                      N                  XX                                                                                          $580,000
      0039051776                                                             $681,084.66        PURCH               Full                                                      N                  XX                                                                                          $895,000
      0039052840                                                             $750,000.00        PURCH               Full                                                      Y                  UGI                        10712744                              25%                        $895,000
      0039054754                                                             $551,000.00        PURCH               Full                                                      N                  XX                                                                                          $810,000
      0039062427                                                             $422,000.00        PURCH               Full                                                      Y                  CMG                        17568035                              30%                        $465,000
      0039067442                                                             $522,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,915,000
      0039068499                                                             $500,000.00        PURCH               Full                                                      N                  XX                                                                                          $710,030
      0039069778                                                             $608,000.00        CASHO               Full                                                      N                  XX                                                                                          $810,000
      0039070289                                                             $544,000.00        PURCH               Full                                                      N                  XX                                                                                          $740,000
      0039073176                                                             $555,000.00        PURCH               Full                                                      N                  XX                                                                                          $735,000
      0039074034                                                             $465,000.00        CASHO               Full                                                      N                  XX                                                                                          $600,000
      0039086541                                                             $790,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,200,000
      0039097183                                                             $556,000.00        PURCH               Full                                                      N                  XX                                                                                          $695,000
      0039100532                                                             $520,000.00        PURCH               Full                                                      N                  XX                                                                                          $717,000
      0039100961                                                             $549,042.75        PURCH               Full                                                      Y                  GEMICO                     6300845338                            30%                        $600,000
      0039104229                                                             $525,000.00        CASHO               Full                                                      N                  XX                                                                                          $700,000
      0039104443                                                             $480,000.00        REFI                Full                                                      N                  XX                                                                                          $940,000
      0039105358                                                             $584,500.00        PURCH               Full                                                      N                  XX                                                                                          $835,000
      0039122841                                                             $644,000.00        PURCH               Full                                                      N                  XX                                                                                          $805,000
      0039141387                                                             $632,000.00        PURCH               Full                                                      N                  XX                                                                                          $790,000
      0039155775                                                             $455,000.00        PURCH               Full                                                      N                  XX                                                                                          $692,000
      0039162334                                                             $584,000.00        PURCH               Full                                                      N                  XX                                                                                          $730,000
      0039202627                                                             $600,000.00        PURCH               Full                                                      N                  XX                                                                                          $815,000
      0039219613                                                           $1,000,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,640,000
      0039231345                                                             $730,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,475,000
      0039231709                                                             $470,000.00        PURCH               Full                                                      N                  XX                                                                                          $777,500
      0039234406                                                             $604,000.00        PURCH               Full                                                      N                  XX                                                                                          $755,000
      0039238860                                                             $679,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,100,000
      0039242722                                                             $570,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,040,000
      0039244488                                                             $740,000.00        PURCH               Full                                                      N                  XX                                                                                          $925,000
      0039254040                                                             $495,000.00        PURCH               Full                                                      N                  XX                                                                                          $940,000
      0039256425                                                             $558,870.83        CASHO               Full                                                      N                  XX                                                                                        $1,200,000
      0039282926                                                             $600,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,250,000
      0039288337                                                             $640,000.00        PURCH               Full                                                      N                  XX                                                                                          $800,000
      0039313499                                                             $560,000.00        PURCH               Full                                                      N                  XX                                                                                          $720,000
      0039369236                                                             $485,000.00        PURCH               Full                                                      N                  XX                                                                                          $990,000
      0039374285                                                             $534,800.00        PURCH               Full                                                      N                  XX                                                                                          $700,000
      0039392667                                                           $1,680,000.00        PURCH               Full                                                      N                  XX                                                                                        $2,170,000
      0039393129                                                             $567,200.00        PURCH               Full                                                      N                  XX                                                                                          $720,000
      0039396346                                                             $428,000.00        PURCH               Full                                                      N                  XX                                                                                          $535,000
      0039400205                                                             $442,975.20        PURCH               Full                                                      N                  XX                                                                                          $566,000
      0039414800                                                             $599,000.00        PURCH               Full                                                      N                  XX                                                                                          $849,000
      0039732367                                                             $633,117.88        PURCH               Full                                                      N                  XX                                                                                          $810,000
      0039732953                                                             $504,000.00        PURCH               Reduced - Alt Income Verified Assets                      N                  XX                                                                                          $640,000
      0039750658                                                           $1,130,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,412,500
      0039750997                                                             $531,500.00        PURCH               Full                                                      N                  XX                                                                                        $1,000,000
      0039762349                                                             $481,900.00        PURCH               Full                                                      N                  XX                                                                                          $686,000
      0039763032                                                             $691,270.22        REFI                Full                                                      N                  XX                                                                                          $930,000
      7076442156                                                             $579,077.85        PURCH               Full                                                      N                                                                                                              $725,000
      7077803844                                                             $825,506.00        REFI                Full                                                      N                  XX                                                                                        $1,450,000
      7100009609                                                             $499,576.20        REFI                Full                                                      N                  XX                                                                                          $838,000
      7100068357                                                             $480,000.00        PURCH               Full                                                      N                  XX                                                                                          $600,000
      7100134167                                                             $728,940.21        REFI                Full                                                      N                  XX                                                                                        $1,325,000
      7100415434                                                             $732,000.00        REFI                Full                                                      N                  XX                                                                                        $1,120,000
      7100423180                                                             $437,920.00        PURCH               Full                                                      N                  XX                                                                                          $561,000
      7100425870                                                             $452,000.00        PURCH               Loan Star 3/Alt Income Verified Assets                    N                  XX                                                                                          $580,000
      7100426480                                                             $519,555.78        CASHO               Full                                                      N                  XX                                                                                          $650,000
      7100523385                                                             $862,500.00        PURCH               Full                                                      N                  XX                                                                                        $1,200,000
      7100535694                                                             $639,460.52        PURCH               Loan Star 3/Alt Income Verified Assets                    N                  XX                                                                                          $810,000
      7100557482                                                             $625,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,310,000
      7100572333                                                             $677,371.89        CASHO               Full                                                      N                  XX                                                                                        $1,350,000
      7100853410                                                             $700,000.00        PURCH               Loan Star 5/No Income Verified Assets                     N                  XX                                                                                        $4,200,000
      7101748817                                                             $903,758.32        CASHO               Loan Star 3/Alt Income Verified Assets                    N                  XX                                                                                        $1,250,000
      7101768435                                                             $283,257.00        CASHO               Loan Star 3/Alt Income Verified Assets                    N                  XX                                                                                          $360,000
      7101851223                                                             $491,117.36        REFI                Full                                                      N                  XX                                                                                          $965,000
      7101851421                                                             $933,177.99        CASHO               Full                                                      N                  XX                                                                                        $1,700,000
      7101901713                                                              $46,023.26        CASHO               Full                                                      N                  XX                                                                                          $250,000
      7101901739                                                             $614,900.00        REFI                Full                                                      N                  XX                                                                                        $1,245,000
      7101960255                                                             $455,510.45        CASHO               Loan Star 3/Alt Income Verified Assets                    N                  XX                                                                                          $570,000
      7102012395                                                             $418,000.00        PURCH               Full                                                      N                  XX                                                                                        $1,720,000
      7102013351                                                             $849,268.28        CASHO               Loan Star 3/Alt Income Verified Assets                    N                  XX                                                                                        $1,150,000
      7102157208                                                             $470,000.00        PURCH               Loan Star 3/Alt Income Verified Assets                    N                  XX                                                                                        $1,000,000
      7102157687                                                             $515,000.00        PURCH               Full                                                      N                                                                                                              $530,000
      7102158065                                                             $434,500.00        PURCH               Loan Star 3/Alt Income Verified Assets                    N                                                                                                              $435,000
      7102158248                                                             $469,263.00        PURCH               Full                                                      Y                  UGI                        10763806                              30%                        $495,000
      7102209231                                                             $799,903.34        CASHO               Full                                                      N                  XX                                                                                        $1,635,000
      7102571994                                                             $554,900.00        REFI                Full                                                      N                  XX                                                                                        $1,050,000
      7102680639                                                             $559,835.83        CASHO               Full                                                      N                  XX                                                                                          $735,000
      7102724544                                                             $627,609.16        CASHO               Loan Star 4/Stated Income Verified Assets                 N                  XX                                                                                        $1,500,000
      7103182239                                                             $686,087.00        CASHO               Full                                                      N                  XX                                                                                          $975,000
      7103189937                                                           $2,500,000.00        PURCH               Full                                                      N                                                                                   12%                      $3,015,000
      7103363086                                                             $479,920.00        PURCH               Full                                                      N                  XX                                                                                          $600,000
      7103548587                                                             $460,000.00        CASHO               Full                                                      N                  XX                                                                                          $900,000
      7103647470                                                             $468,225.00        PURCH               Full                                                      N                                                                                   25%                        $525,000
      7103679705                                                             $554,400.00        CASHO               Full                                                      N                  XX                                                                                          $950,000
      7105430487                                                           $1,998,169.01        CASHO               Full                                                      Y                  RADIAN                     10600144                              35%                      $2,000,000
      7109769138                                                           $1,206,570.13        PURCH               Full                                                      N                  XX                                                                                        $1,750,000

===============================================================================================================================================================================================================
    LOAN ID                PURCHASE PRICE                SERVICING FEE                    LENDER / SELLER FUNDED BUYDOWN                     LENDER FUNDED MI                    ORIGINAL PLEDGE AMOUNT
===============================================================================================================================================================================================================
      0031486947                      $540,759                       0.250                               N                                       0.000000                                                   0.
      0031851918                      $537,531                       0.250                               N                                       0.000000                                                   0.
      0031920382                      $705,620                       0.250                               N                                       0.000000                                                   0.
      0032542300                      $770,978                       0.250                               N                                       0.000000                                                   0.
      0033940545                      $590,000                       0.250                               N                                       0.000000                                                   0.
      0034946285                    $1,600,000                       0.250                               N                                       0.000000                                                   0.
      0035070820                            $0                       0.250                               N                                       0.000000                                                   0.
      0035074350                      $832,500                       0.250                               N                                       0.000000                                                   0.
      0035075373                      $840,000                       0.250                               N                                       0.000000                                                   0.
      0035077437                      $725,000                       0.250                               N                                       0.000000                                                   0.
      0035079862                      $549,000                       0.250                               N                                       0.000000                                                   0.
      0035081116                      $817,500                       0.250                               N                                       0.000000                                                   0.
      0035081488                            $0                       0.250                               N                                       0.000000                                                   0.
      0035083658                    $1,325,000                       0.250                               N                                       0.000000                                                   0.
      0035084938                      $560,000                       0.250                               N                                       0.000000                                                   0.
      0035087303                      $595,000                       0.250                               N                                       0.000000                                                   0.
      0035089101                      $660,000                       0.250                               N                                       0.000000                                                   0.
      0035090695                    $1,395,000                       0.250                               N                                       0.000000                                                   0.
      0035093905                    $1,485,000                       0.250                               N                                       0.000000                                                   0.
      0035096015                      $559,000                       0.250                               N                                       0.000000                                                   0.
      0035102433                    $1,500,000                       0.250                               N                                       0.000000                                                   0.
      0035102490                            $0                       0.250                               N                                       0.000000                                                   0.
      0035102631                    $1,275,000                       0.250                               N                                       0.000000                                                   0.
      0035360593                    $1,280,000                       0.250                               N                                       0.000000                                                   0.
      0035363050                      $970,000                       0.250                               N                                       0.000000                                                   0.
      0035514330                    $1,200,000                       0.250                               N                                       0.000000                                                   0.
      0035552017                      $515,000                       0.250                               N                                       0.000000                                                   0.
      0035592021                      $664,000                       0.250                               N                                       0.000000                                                   0.
      0035631423                      $640,000                       0.250                               N                                       0.000000                                                   0.
      0035643428                      $850,000                       0.250                               N                                       0.000000                                                   0.
      0035694538                            $0                       0.250                               N                                       0.000000                                                   0.
      0035700889                      $608,000                       0.250                               N                                       0.000000                                                   0.
      0035712132                      $856,150                       0.250                               N                                       0.000000                                                   0.
      0035712975                      $750,000                       0.250                               N                                       0.000000                                                   0.
      0035717586                      $790,000                       0.250                               N                                       0.000000                                                   0.
      0035727510                      $850,000                       0.250                               N                                       0.000000                                                   0.
      0035727924                    $1,260,000                       0.250                               N                                       0.000000                                                   0.
      0035744135                      $975,000                       0.250                               N                                       0.000000                                                   0.
      0038648093                      $775,000                       0.250                               N                                       0.000000                                                   0.
      0038675294                      $592,500                       0.250                               N                                       0.000000                                                   0.
      0038704904                      $700,500                       0.250                               N                                       0.000000                                                   0.
      0038724837                      $849,000                       0.250                               N                                       0.000000                                                   0.
      0038726550                      $605,000                       0.250                               N                                       0.000000                                                   0.
      0038732517                      $676,312                       0.250                               N                                       0.000000                                                   0.
      0038766234                            $0                       0.250                               N                                       0.000000                                                   0.
      0038766820                      $775,000                       0.250                               N                                       0.000000                                                   0.
      0038802591                    $1,485,600                       0.250                               N                                       0.000000                                                   0.
      0038807806                      $600,000                       0.250                               N                                       0.000000                                                   0.
      0038811279                      $970,000                       0.250                               N                                       0.000000                                                   0.
      0038811402                      $985,000                       0.250                               N                                       0.000000                                                   0.
      0038819504                            $0                       0.250                               N                                       0.000000                                                   0.
      0038822730                      $705,000                       0.250                               N                                       0.000000                                                   0.
      0038832697                      $857,076                       0.250                               N                                       0.000000                                                   0.
      0038840724                      $695,900                       0.250                               N                                       0.000000                                                   0.
      0038850632                      $899,000                       0.250                               N                                       0.000000                                                   0.
      0038873493                            $0                       0.250                               N                                       0.000000                                                   0.
      0038877056                      $650,000                       0.250                               N                                       0.000000                                                   0.
      0038879359                      $635,000                       0.250                               N                                       0.000000                                                   0.
      0038882759                      $899,000                       0.250                               N                                       0.000000                                                   0.
      0038883088                      $910,000                       0.250                               N                                       0.000000                                                   0.
      0038897815                            $0                       0.250                               N                                       0.000000                                                   0.
      0038897971                            $0                       0.250                               N                                       0.000000                                                   0.
      0038898615                            $0                       0.250                               N                                       0.000000                                                   0.
      0038900338                    $1,050,000                       0.250                               N                                       0.000000                                                   0.
      0038919148                      $920,000                       0.250                               N                                       0.000000                                                   0.
      0038925939                      $635,000                       0.250                               N                                       0.000000                                                   0.
      0038927562                      $850,000                       0.250                               N                                       0.000000                                                   0.
      0038931135                      $955,000                       0.250                               N                                       0.000000                                                   0.
      0038949210                      $639,900                       0.250                               N                                       0.000000                                                   0.
      0038967790                      $545,900                       0.250                               N                                       0.000000                                                   0.
      0038979936                      $700,000                       0.250                               N                                       0.000000                                                   0.
      0038982534                    $1,520,000                       0.250                               N                                       0.000000                                                   0.
      0038998407                      $760,000                       0.250                               N                                       0.000000                                                   0.
      0039000443                      $599,000                       0.250                               N                                       0.000000                                                   0.
      0039004759                      $675,000                       0.250                               N                                       0.000000                                                   0.
      0039004825                      $665,000                       0.250                               N                                       0.000000                                                   0.
      0039006481                      $627,500                       0.250                               N                                       0.000000                                                   0.
      0039009618                      $789,000                       0.250                               N                                       0.000000                                                   0.
      0039014345                            $0                       0.250                               N                                       0.000000                                                   0.
      0039014816                            $0                       0.250                               N                                       0.000000                                                   0.
      0039017413                      $592,500                       0.250                               N                                       0.000000                                                   0.
      0039023866                      $587,500                       0.250                               N                                       0.000000                                                   0.
      0039026331                            $0                       0.250                               N                                       0.000000                                                   0.
      0039027602                      $843,500                       0.250                               N                                       0.000000                                                   0.
      0039028519                      $790,000                       0.250                               N                                       0.000000                                                   0.
      0039030937                      $730,000                       0.250                               N                                       0.000000                                                   0.
      0039033261                      $870,000                       0.250                               N                                       0.000000                                                   0.
      0039035647                      $555,140                       0.250                               N                                       0.000000                                                   0.
      0039040126                      $580,000                       0.250                               N                                       0.000000                                                   0.
      0039051776                      $895,000                       0.250                               N                                       0.000000                                                   0.
      0039052840                      $860,000                       0.250                               N                                       0.000000                                                   0.
      0039054754                      $791,000                       0.250                               N                                       0.000000                                                   0.
      0039062427                      $465,500                       0.250                               N                                       0.000000                                                   0.
      0039067442                    $1,915,000                       0.250                               N                                       0.000000                                                   0.
      0039068499                      $710,030                       0.250                               N                                       0.000000                                                   0.
      0039069778                            $0                       0.250                               N                                       0.000000                                                   0.
      0039070289                      $680,000                       0.250                               N                                       0.000000                                                   0.
      0039073176                      $730,000                       0.250                               N                                       0.000000                                                   0.
      0039074034                            $0                       0.250                               N                                       0.000000                                                   0.
      0039086541                    $1,190,000                       0.250                               N                                       0.000000                                                   0.
      0039097183                      $695,000                       0.250                               N                                       0.000000                                                   0.
      0039100532                      $650,000                       0.250                               N                                       0.000000                                                   0.
      0039100961                      $597,500                       0.250                               N                                       0.000000                                                   0.
      0039104229                            $0                       0.250                               N                                       0.000000                                                   0.
      0039104443                            $0                       0.250                               N                                       0.000000                                                   0.
      0039105358                      $835,000                       0.250                               N                                       0.000000                                                   0.
      0039122841                      $805,000                       0.250                               N                                       0.000000                                                   0.
      0039141387                      $790,000                       0.250                               N                                       0.000000                                                   0.
      0039155775                      $680,000                       0.250                               N                                       0.000000                                                   0.
      0039162334                      $730,000                       0.250                               N                                       0.000000                                                   0.
      0039202627                      $810,000                       0.250                               N                                       0.000000                                                   0.
      0039219613                    $1,630,000                       0.250                               N                                       0.000000                                                   0.
      0039231345                    $1,330,000                       0.250                               N                                       0.000000                                                   0.
      0039231709                      $770,000                       0.250                               N                                       0.000000                                                   0.
      0039234406                      $755,000                       0.250                               N                                       0.000000                                                   0.
      0039238860                      $970,000                       0.250                               N                                       0.000000                                                   0.
      0039242722                    $1,035,000                       0.250                               N                                       0.000000                                                   0.
      0039244488                      $925,000                       0.250                               N                                       0.000000                                                   0.
      0039254040                      $915,000                       0.250                               N                                       0.000000                                                   0.
      0039256425                            $0                       0.250                               N                                       0.000000                                                   0.
      0039282926                    $1,230,000                       0.250                               N                                       0.000000                                                   0.
      0039288337                      $800,000                       0.250                               N                                       0.000000                                                   0.
      0039313499                      $700,000                       0.250                               N                                       0.000000                                                   0.
      0039369236                      $990,000                       0.250                               N                                       0.000000                                                   0.
      0039374285                      $668,500                       0.250                               N                                       0.000000                                                   0.
      0039392667                    $2,165,000                       0.250                               N                                       0.000000                                                   0.
      0039393129                      $709,000                       0.250                               N                                       0.000000                                                   0.
      0039396346                      $535,000                       0.250                               N                                       0.000000                                                   0.
      0039400205                      $553,719                       0.250                               N                                       0.000000                                                   0.
      0039414800                      $849,000                       0.250                               N                                       0.000000                                                   0.
      0039732367                      $792,000                       0.250                               N                                       0.000000                                                   0.
      0039732953                      $630,000                       0.250                               N                                       0.000000                                                   0.
      0039750658                    $1,412,500                       0.250                               N                                       0.000000                                                   0.
      0039750997                      $978,250                       0.250                               N                                       0.000000                                                   0.
      0039762349                      $685,900                       0.250                               N                                       0.000000                                                   0.
      0039763032                            $0                       0.250                               N                                       0.000000                                                   0.
      7076442156                      $640,000                       0.250                               N                                       0.000000                                                   0.
      7077803844                            $0                       0.250                               N                                       0.000000                                                   0.
      7100009609                            $0                       0.250                               N                                       0.000000                                                   0.
      7100068357                      $655,000                       0.250                               N                                       0.000000                                                   0.
      7100134167                            $0                       0.250                               N                                       0.000000                                                   0.
      7100415434                            $0                       0.250                               N                                       0.000000                                                   0.
      7100423180                      $547,400                       0.250                               N                                       0.000000                                                   0.
      7100425870                      $575,000                       0.250                               N                                       0.000000                                                   0.
      7100426480                            $0                       0.250                               N                                       0.000000                                                   0.
      7100523385                    $1,150,000                       0.250                               N                                       0.000000                                                   0.
      7100535694                      $800,000                       0.250                               N                                       0.000000                                                   0.
      7100557482                    $1,300,000                       0.250                               N                                       0.000000                                                   0.
      7100572333                            $0                       0.250                               N                                       0.000000                                                   0.
      7100853410                    $3,950,000                       0.250                               N                                       0.000000                                                   0.
      7101748817                            $0                       0.250                               N                                       0.000000                                                   0.
      7101768435                            $0                       0.250                               N                                       0.000000                                             103,257.
      7101851223                            $0                       0.250                               N                                       0.000000                                                   0.
      7101851421                            $0                       0.250                               N                                       0.000000                                                   0.
      7101901713                            $0                       0.250                               N                                       0.000000                                                   0.
      7101901739                            $0                       0.250                               N                                       0.000000                                                   0.
      7101960255                            $0                       0.250                               N                                       0.000000                                                   0.
      7102012395                    $1,715,000                       0.250                               N                                       0.000000                                                   0.
      7102013351                            $0                       0.250                               N                                       0.000000                                                   0.
      7102157208                      $945,000                       0.250                               N                                       0.000000                                                   0.
      7102157687                      $515,000                       0.250                               N                                       0.000000                                             154,500.
      7102158065                      $434,500                       0.250                               N                                       0.000000                                             130,350.
      7102158248                      $493,962                       0.250                               N                                       0.000000                                                   0.
      7102209231                            $0                       0.250                               N                                       0.000000                                                   0.
      7102571994                            $0                       0.250                               N                                       0.000000                                                   0.
      7102680639                            $0                       0.250                               N                                       0.000000                                                   0.
      7102724544                            $0                       0.250                               N                                       0.000000                                                   0.
      7103182239                            $0                       0.250                               N                                       0.000000                                                   0.
      7103189937                    $3,005,000                       0.250                               N                                       0.000000                                             546,750.
      7103363086                      $599,900                       0.250                               N                                       0.000000                                                   0.
      7103548587                            $0                       0.250                               N                                       0.000000                                                   0.
      7103647470                      $523,040                       0.250                               N                                       0.000000                                             102,097.
      7103679705                            $0                       0.250                               N                                       0.000000                                                   0.
      7105430487                            $0                       0.250                               N                                       0.000000                                                   0.
      7109769138                    $1,725,000                       0.250                               N                                       0.000000                                                   0.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
        E

       

      REQUEST
        FOR RELEASE OF DOCUMENTS

       

      To: Citibank,
        N.A.

      Attn: Inventory
        Control

       

      Re:
        Pooling and Servicing Agreement dated as of September 1, 2006,
        among

      PHH
        Mortgage Capital LLC, as Depositor, PHH Mortgage Corporation,

      as
        Master
        Servicer and Citibank, N.A., as Trustee

       

      In
        connection with the administration of the Mortgage Loans held by you as Trustee
        for the Owner pursuant to the above-captioned Pooling and Servicing Agreement,
        we request the release, and hereby acknowledge receipt, of the Trustee’s
        Mortgage File for the Mortgage Loan described below, for the reason
        indicated.

       

      MORTGAGE
        LOAN NUMBER:

       

      MORTGAGOR
        NAME, ADDRESS & ZIP CODE:

       

      REASON
        FOR REQUESTING DOCUMENTS (check one):

       

      
        	
                _____

              	 	
                1.

              	 	
                Mortgage
                  Paid in Full

              
	 	 	 	 	 
	
                _____

              	 	
                2.

              	 	
                Foreclosure

              
	 	 	 	 	 
	
                _____

              	 	
                3.

              	 	
                Substitution

              
	 	 	 	 	 
	
                _____

              	 	
                4.

              	 	
                Other
                  Liquidation (Repurchases, etc.)

              
	 	 	 	 	 
	
                _____

              	 	
                5.

              	 	 
	 	 	 	 	
                Nonliquidation Reason:
                  ________________________

              

      

      

       

      
        	
                Address
                  to which Trustee should

                Deliver
                  the Trustee’s Mortgage File:

              	 	 	
                ____________________________

              
	 	 	 	
                ____________________________

              
	 	 	 	
                ____________________________

              
	 	 	 	 
	 	
                By:

              	 	
                ____________________________

              
	 	 	 	
                (authorized
                  signer)

              
	 	 	 	 
	 	
                Issuer:

              	 	
                ____________________________

              
	 	
                Address:

              	 	
                ____________________________

              
	 	 	 	
                ____________________________

              
	 	
                Date:

              	 	
                ____________________________

              

      

      

      

      EXHIBIT
        F-1

       

      FORM
        OF
        RULE 144A REPRESENTATION LETTER

       

      ______
        __, 2006

       

      Citibank,
        N.A.

      111
        Wall
        Street, 14th
        Floor /
        Zone 3

      New
        York,
        New York 10005

       

      [Certificate
        Registrar]

      ________________________

      ________________________

       

      
        	 	
                Re:

              	
                PHH
                  Mortgage Capital LLC

                PHHMC
                  Mortgage Pass-Through Certificates, Series 2006-3,

                Class
                  ___, Representing a ___% Class ___ Percentage
                  Interest

              

      

      

       

      Ladies
        and Gentlemen:

       

      In
        connection with the purchase from ______________________ (the “Transferor”) on
        the date hereof of the captioned trust certificates (the “Certificates”),
        _______________ (the “Transferee”) hereby certifies as follows:

       

      1. The
        Transferee is a “qualified institutional buyer” as that term is defined in Rule
        144A (“Rule 144A”) under the Securities Act of 1933 (the “1933 Act”) and has
        completed either of the forms of certification to that effect attached hereto
        as
        Annex 1 or Annex 2. The Transferee is aware that the sale to it is being
        made in
        reliance on Rule 144A. The Transferee is acquiring the Certificates for its
        own
        account or for the account of a qualified institutional buyer, and understands
        that such Certificate 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.

       

      2. The
        Transferee has been furnished with all information regarding (a) the
        Certificates and distributions thereon, (b) the nature, performance and
        servicing of the Mortgage Loans, (c) the Pooling and Servicing Agreement
        referred to below, and (d) any credit enhancement mechanism associated with
        the
        Certificates, that it has requested.

       

      All
        capitalized terms used but not otherwise defined herein have the respective
        meanings assigned thereto in the Pooling and Servicing Agreement, dated as
        of
        September 1, 2006, among PHH Mortgage Capital LLC as Depositor, PHH Mortgage
        Corporation as Master Servicer and Citibank, N.A. as Trustee, pursuant to
        which
        the Certificates were issued.

      
        	 	 	 
	 	
                [TRANSFEREE]

              
	 
 	 
 	
                 

              
	 	  	 
	 	
                By:     
                  ________________________________

              
	 	
                Name:
                  ________________________________

                
                  Title:  
                    ________________________________

                

              

      

       

       

      ANNEX
        1 TO EXHIBIT F-1

       

      QUALIFIED
        INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

       

      [For
        Transferees Other Than Registered Investment Companies]

       

      The
        undersigned hereby certifies as follows to [name of Transferor] (the
“Transferor”) and Citibank, N.A., as Trustee and Certificate Registrar, with
        respect to the mortgage pass-through certificates (the “Certificates”) described
        in the Transferee Certificate to which this certification relates and to
        which
        this certification is an Annex:

       

      1.  As
        indicated below, the undersigned is the President, Chief Financial Officer,
        Senior Vice President or other executive officer of the entity purchasing
        the
        Certificates (the “Transferee”).

       

      2.  In
        connection with purchases by the Transferee, the Transferee is a “qualified
        institutional buyer” as that term is defined in Rule 144A under the Securities
        Act of 1933 (“Rule 144A”) because (i) the Transferee 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 Transferee’s most recent fiscal year (such amount being calculated in
        accordance with Rule 144A) and (ii) the Transferee satisfies the criteria
        in the
        category marked below.

       

      
        	 	
                ___

                 

              	
                Corporation,
                  etc.
                  The Transferee is a corporation (other than a bank, savings and
                  loan
                  association or similar institution), Massachusetts or similar business
                  trust, partnership, or any organization described in Section 501(c)(3)
                  of
                  the Internal Revenue Code of 1986.

                 

              
	 	
                ___

                 

              	
                Bank.
                  The Transferee (a) is a national bank or banking institution organized
                  under the laws of any State, territory or the District of Columbia,
                  the
                  business of which is substantially confined to banking and is supervised
                  by the State or territorial banking commission or similar official
                  or is a
                  foreign bank or equivalent institution, and (b) has an audited
                  net worth
                  of at least $25,000,000 as demonstrated in its latest annual financial
                  statements, a
                  copy of which is attached hereto.

                 

              
	 	
                ___

              	
                Savings
                  and Loan.
                  The Transferee (a) is a savings and loan association, building
                  and loan
                  association, cooperative bank, homestead association or
                  similar

              
	 	 	 
	 	 	
                institution,
                  which is supervised and examined by a State or Federal authority
                  having
                  supervision over any such institutions or is a foreign savings
                  and loan
                  association or equivalent institution and (b) has an audited net
                  worth of
                  at least $25,000,000 as demonstrated in its latest annual financial
                  statements, a
                  copy of which is attached hereto.

                 

              
	 	
                ___

                 

              	
                Broker-Dealer.
                  The Transferee is a dealer registered pursuant to Section 15 of
                  the
                  Securities Exchange Act of 1934.

                 

              
	 	
                ___

                 

              	
                Insurance
                  Company.
                  The Transferee is an insurance company whose primary and predominant
                  business activity is the writing of insurance or the reinsuring
                  of risks
                  underwritten by insurance companies and which is subject to supervision
                  by
                  the insurance commissioner or a similar official or agency of a
                  State,
                  territory or the District of Columbia.

                 

              
	 	
                ___

                 

              	
                State
                  or Local Plan.
                  The Transferee 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 Transferee is an employee benefit plan within the meaning of
                  Title I
                  of the Employee Retirement Income Security Act of 1974.

                 

              
	 	
                ___

                 

              	
                Investment
                  Advisor.
                  The Transferee is an investment advisor registered under the Investment
                  Advisers Act of 1940.

                 

              

      

      3.  The
        term
“Securities”
        as used
        herein Does
        Not Include
        (i)
        securities of issuers that are affiliated with the Transferee, (ii) securities
        that are part of an unsold allotment to or subscription by the Transferee,
        if
        the Transferee is a dealer, (iii) securities issued or guaranteed by the
        U.S. or
        any instrumentality thereof, (iv) bank deposit notes and certificates of
        deposit, (v) loan participations, (vi) repurchase agreements, (vii) securities
        owned but subject to a repurchase agreement and (viii) 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 Transferee, the Transferee used the cost
        of such
        securities to the Transferee and did not include any of the securities referred
        to in the preceding paragraph. Further, in determining such aggregate amount,
        the Transferee may have included securities owned by subsidiaries of the
        Transferee, but only if such subsidiaries are consolidated with the Transferee
        in its financial statements prepared in accordance with generally accepted
        accounting principles and if the investments of such subsidiaries are managed
        under the Transferee’s direction. However, such securities were not included if
        the Transferee is a majority-owned, consolidated subsidiary of another
        enterprise and the Transferee is not itself a reporting company under the
        Securities Exchange Act of 1934.

       

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

       

      
        	 	
                ___
                  

              	
                ___
                  

              	
                Will
                  the Transferee be purchasing the Certificates

              
	 	
                Yes

                 

              	
                No

                 

              	
                only
                  for the Transferee’s own account?

                 

              

      

      6.  If
        the
        answer to the foregoing question is “no”, the Transferee agrees that, in
        connection with any purchase of securities sold to the Transferee for the
        account of a third party (including any separate account) in reliance on
        Rule
        144A, the Transferee 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 Transferee agrees that the Transferee will not purchase
        securities for a third party unless the Transferee 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
        Transferee 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 Transferee’s purchase of the Certificates will constitute a
        reaffirmation of this certification as of the date of such purchase. In
        addition, if the Transferee is a bank or savings and loan as provided above,
        the
        Transferee agrees that it will furnish to such parties updated annual financial
        statements promptly after they become available.

       

      Dated:

      
        
          
            	 	 	 
	 	
                    
                      _____________________________________

                      Print
                        Name of Transferee

                    

                  
	 
 	 
 	
                     

                  
	 	  	 
	 	
                    By:     
                      ________________________________

                  
	 	
                    Name:
                      ________________________________

                    
                      Title:  
                        ________________________________

                    

                  

          

        

      

       

       

      ANNEX
        2 TO EXHIBIT F-1

       

      QUALIFIED
        INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

       

      [For
        Transferees That Are Registered Investment Companies]

       

      The
        undersigned hereby certifies as follows to [name of Transferor] (the
“Transferor”) and Citibank, N.A., as Trustee and Certificate Registrar, with
        respect to the mortgage pass-through certificates (the “Certificates”) described
        in the Transferee Certificate to which this certification relates and to
        which
        this certification is an Annex:

       

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

       

      2.  In
        connection with purchases by the Transferee, the Transferee is a “qualified
        institutional buyer” as defined in Rule 144A because (i) the Transferee is an
        investment company registered under the Investment Company Act of 1940, and
        (ii)
        as marked below, the Transferee alone, or the Transferee’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 Transferee’s most recent
        fiscal year. For purposes of determining the amount of securities owned by
        the
        Transferee or the Transferee’s Family of Investment Companies, the cost of such
        securities was used.

       

      
        	 	
                ____
                  

                 

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

                 

              
	 	
                ____

                 

              	
                The
                  Transferee 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 Transferee’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
        Transferee or are part of the Transferee’s Family of Investment Companies, (ii)
        securities issued or guaranteed by the U.S. or any instrumentality thereof,
        (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.

       

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

       

      6.  The
        undersigned will notify the parties to which this certification is made of
        any
        changes in the information and conclusions herein. Until such notice, the
        Transferee’s purchase of the Certificates will constitute a reaffirmation of
        this certification by the undersigned as of the date of such
        purchase.

       

      Dated:

       

      
        	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                Print
                  Name of Transferee or Advisor

              
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                By:

              	 
	 	 	 	 	 	 	 	
                Name:

              	 
	 	 	 	 	 	 	 	
                Title:

              	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                IF
                  AN ADVISER:

              
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                Print
                  Name of Transferee

              

      

      

      The
        undersigned hereby certifies on behalf of the purchaser named below (the
        “Purchaser”) as follows:

       

      1.  I
        am an
        executive officer of the Purchaser.

       

      2.  The
        Purchaser is a “qualified institutional buyer”, as defined in Rule 144A, (“Rule
        144A”) under the Securities Act of 1933, as amended.

       

      3.  As
        of the
        date specified below (which is not earlier than the last day of the Purchaser’s
        most recent fiscal year), the amount of “securities”, computed for purposes of
        Rule 144A, owned and invested on a discretionary basis by the Purchaser was
        in
        excess of $100,000,000.

       

      
        	
                Name
                  of Purchaser 

              	 
	 	 
	
                By:
                  (Signature)

              	 
	 	 
	
                Name
                  of Signatory 

              	 
	 	 
	
                Title
                  

              	 
	 	 
	
                Date
                  of this certificate 

              	 
	 	 
	
                Date
                  of information provided in paragraph 3 

              	 

      

      

       

      
        
          ______________________________________

          1
            Transferee must own and/or invest on a discretionary basis at least $100,000,000
            in securities unless Transferee is a dealer, and, in that case, Transferee
            must
            own and/or invest on a discretionary basis at least $10,000,000 in
            securities.

        

      

       

       

      EXHIBIT
        F-2

       

      FORM
        OF
        TRANSFEROR CERTIFICATE

       

      _____
        __,
        2006

       

      Citibank,
        N.A.

      111
        Wall
        Street, 14th
        Floor /
        Zone 3

      New
        York,
        New York 10005

       

      [Certificate
        Registrar]

      ________________________

      ________________________

       

      
        	 	
                Re:

              	
                PHH
                  Mortgage Capital LLC,

                PHHMC
                  Mortgage Pass-Through Certificates, Series 2006-3,

                Class
                  ___, Representing a ___% Class ___ Percentage
                  Interest

              

      

       

       

      Ladies
        and Gentlemen:

       

      In
        connection with the transfer by ________________ (the “Transferor”) to
        ________________ (the “Transferee”) of the captioned mortgage pass-through
        certificates (the “Certificates”), the Transferor hereby certifies as
        follows:

       

      Neither
        the Transferor nor anyone acting on its behalf has (a) offered, pledged,
        sold,
        disposed of or otherwise transferred any Certificate, any interest in any
        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 any Certificate, any interest in any Certificate or any other similar
        security from any person in any manner, (c) has otherwise approached or
        negotiated with respect to any Certificate, any interest in any 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,
        (e)
        has taken any other action, that (in the case of each of subclauses (a) through
        (e) above) would constitute a distribution of the Certificates under the
        Securities Act of 1933, as amended (the “1933 Act”), or would render the
        disposition of any Certificate a violation of Section 5 of the 1933 Act or
        any
        state securities law or would require registration or qualification pursuant
        thereto. The Transferor will not act, nor has it authorized or will it authorize
        any person to act, in any manner set forth in the foregoing sentence with
        respect to any Certificate. The Transferor will not sell or otherwise transfer
        any of the Certificates, except in compliance with the provisions of that
        certain Pooling and Servicing Agreement, dated as of September 1, 2006, among
        PHH Mortgage Capital LLC as Depositor, PHH Mortgage Corporation as Master
        Servicer and Citibank, N.A. as Trustee (the “Pooling and Servicing Agreement”),
        pursuant to which Pooling and Servicing Agreement the Certificates were
        issued.

       

      Capitalized
        terms used but not defined herein shall have the meanings assigned thereto
        in
        the Pooling and Servicing Agreement.

      

      
        	 	 	 	 	 	 	 	
                Very
                  truly yours,

              
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                [Transferor]

              	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                By:

              	 
	 	 	 	 	 	 	 	
                Name:

              	 
	 	 	 	 	 	 	 	
                Title:

              	 

      

      

      
 

      EXHIBIT
        F-3

       

      FORM
        OF
        TRANSFEREE REPRESENTATION LETTER

       

      _____
        __,
        2006

       

      Citibank,
        N.A.

      111
        Wall
        Street, 14th
        Floor /
        Zone 3

      New
        York,
        New York 10005

       

      [Certificate
        Registrar]

      ________________________

      ________________________

       

      
        	 	
                Re:

              	
                PHH
                  Mortgage Capital LLC,

                PHHMC
                  Mortgage Pass-Through Certificates, Series 2006-3,

                Class
                  ___, Representing a ___% Class ___ Percentage
                  Interest

              

      

      

       

      Ladies
        and Gentlemen:

       

      In
        connection with the transfer by ________________ (the “Transferor”) to
        ________________ (the “Transferee”) of the captioned mortgage pass-through
        certificates (the “Certificates”), the Transferee hereby certifies as
        follows:

       

      1.  The
        Transferee understands that (a) the Certificates have not been and will not
        be
        registered or qualified under the Securities Act of 1933 (the “1933 Act”) or any
        state securities law, (b) the Depositor 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 Pooling and Servicing Agreement contains restrictions regarding the transfer
        of the Certificates and (e) the Certificates will bear a legend to the foregoing
        effect.

       

      2.  The
        Transferee 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 1933 Act or any applicable state securities
        laws.

       

      3.  The
        Transferee is (a) a substantial, sophisticated [[For Class A-6, Class A-7,
        Class
        A-8, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5 Certificates
        Only:] 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 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 1933 Act.

       

      4.  The
        Transferee has been furnished with all information regarding (a) the
        Certificates and distributions thereon, (b) the nature, performance and
        servicing of the Mortgage Loans, (c) the Pooling and Servicing Agreement
        referred to below, and (d) any credit enhancement mechanism associated with
        the
        Certificates, that it has requested.

       

      5.  The
        Transferee 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 or 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, (e) take any other action, that (in the case of each of subclauses
        (a)
        through (e) above) would constitute a distribution of the Certificates under
        the
        1933 Act, or would render the disposition of any Certificate a violation
        of
        Section 5 of the 1933 Act or any state securities law or would require
        registration or qualification pursuant thereto. The Transferee will not sell
        or
        otherwise transfer any of the Certificates, except in compliance with the
        provisions of that certain Pooling and Servicing Agreement, dated as of
        September 1, 2006, among PHH Mortgage Capital LLC as Depositor, PHH Mortgage
        Corporation as Master Servicer and Citibank, N.A. as Trustee (the “Pooling and
        Servicing Agreement”), pursuant to which Pooling and Servicing Agreement the
        Certificates were issued.

       

      Capitalized
        terms used but not defined herein shall have the meanings assigned thereto
        in
        the Pooling and Servicing Agreement.

       

       

       

      
        	 	 	 	 	 	 	 	
                Very
                  truly yours,

              
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                [Transferee]

              	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                By:

              	 
	 	 	 	 	 	 	 	
                Name:

              	 
	 	 	 	 	 	 	 	
                Title:

              	 

      

      

       

      EXHIBIT
        F-4

       

      FORM
        OF
        TRANSFER AFFIDAVIT AND AGREEMENT

       

      

       

      
        	
                STATE
                  OF_____________

              	
                )

              	 
	 	
                )

              	
                ss.:

              
	
                COUNTY
                  OF___________

              	
                )

              	 

      

      

       

      ________________________,
        being duly sworn, deposes, represents and warrants as follows:

       

      (i)
        I am
        a ______________________ of ____________________________ (the “Owner”) a
        corporation duly organized and existing under the laws of ______________,
        the
        record owner of or ______% Percentage Interest in the PHH Mortgage Capital
        LLC,
        PHHMC Mortgage Pass-Through Certificates, Series 2006-3, Class R-I Certificates
        and Class R-II Certificates (together, the “Class R Certificates”), on behalf of
        whom I make this affidavit and agreement. Capitalized terms used but not
        defined
        herein have the respective meanings assigned thereto in the Pooling and
        Servicing Agreement pursuant to which the Class R Certificates were
        issued.

       

      (ii)
        The
        Owner (i) is and will be a “Permitted Transferee” as of ____________________,
        200___ and (ii) is acquiring the Class R Certificates for its own account
        or for
        the account of another Owner from which it has received an affidavit in
        substantially the same form as this affidavit. A “Permitted Transferee” is any
        person other than a “disqualified organization” or a possession of the United
        States. For this purpose, a “disqualified organization” means the United States,
        any state or political subdivision thereof, any agency or instrumentality
        of any
        of the foregoing (other than an instrumentality all of the activities of
        which
        are subject to tax and, except for the Federal Home Loan Mortgage Corporation,
        a
        majority of whose board of directors is not selected by any such governmental
        entity) or any foreign government, international organization or any agency
        or
        instrumentality of such foreign government or organization, any rural electric
        or telephone cooperative, or any organization (other than certain farmers’
cooperatives) that is generally exempt from federal income tax unless such
        organization is subject to the tax on unrelated business taxable
        income.

       

      (iii)
        The
        Owner is aware (i) of the tax that would be imposed on transfers of the Class
        R
        Certificates to disqualified organizations under the Internal Revenue Code
        of
        1986 that applies to all transfers of the Class R Certificates after May
        31,
        1988; (ii) that such tax would be on the transferor or, if such transfer
        is
        through an agent (which person includes a broker, nominee or middleman) for
        a
        non-Permitted Transferee, on the agent; (iii) that the person otherwise liable
        for the tax shall be relieved of liability for the tax if the transferee
        furnishes to such person an affidavit that thetransferee is a Permitted
        Transferee and, at the time of transfer, such person does not have actual
        knowledge that the affidavit is false; and (iv) that each of the Class R
        Certificates may be a “noneconomic residual interest” within the meaning of
        proposed Treasury regulations promulgated under the Code and that the transferor
        of a “noneconomic residual interest” will remain liable for any taxes due with
        respect to the income on such residual interest, unless no significant purpose
        of the transfer is to impede the assessment or collection of tax.

       

      (iv)
        The
        Owner is aware of the tax imposed on a “pass-through entity” holding the Class R
        Certificates if, at any time during the taxable year of the pass-through
        entity,
        a non-Permitted Transferee is the record holder of an interest in such entity.
        (For this purpose, a “pass-through entity” includes a regulated investment
        company, a real estate investment trust or common trust fund, a partnership,
        trust or estate, and certain cooperatives.)

       

      (v)
        The
        Owner is aware that the Trustee will not register the transfer of any Class
        R
        Certificate unless the transferee, or the transferee’s agent, delivers to the
        Trustee, among other things, an affidavit in substantially the same form
        as this
        affidavit. The Owner expressly agrees that it will not consummate any such
        transfer if it knows or believes that any of the representations contained
        in
        such affidavit and agreement are false.

       

      (vi)
        The
        Owner consents to any additional restrictions or arrangements that shall
        be
        deemed necessary upon advice of counsel to constitute a reasonable arrangement
        to ensure that the Class R Certificates will only be owned, directly or
        indirectly, by an Owner that is a Permitted Transferee.

       

      (vii)
        The
        Owner’s taxpayer identification number is _________________.

       

      (viii)
        The Owner has reviewed the restrictions set forth on the face of the Class
        R
        Certificates and the provisions of Section 5.02(f) of the Pooling and Servicing
        Agreement under which the Class R Certificates were issued (in particular,
        clauses (iii)(A) and (iii)(B) of Section 5.02(f) which authorize the Trustee
        to
        deliver payments to a person other than the Owner and negotiate a mandatory
        sale
        by the Trustee in the event that the Owner holds such Certificate in violation
        of Section 5.02(f)); and that the Owner expressly agrees to be bound by and
        to
        comply with such restrictions and provisions.

       

      (ix)
        The
        Owner is not acquiring and will not transfer the Class R Certificates in
        order
        to impede the assessment or collection of any tax.

       

      (x)
        The
        Owner anticipates that it will, so long as it holds the Class R Certificates,
        have sufficient assets to pay any taxes owed by the holder of such Class
        R
        Certificates, and hereby represents to and for the benefit of the person
        from
        whom it acquired the Class R Certificates that the Owner intends to pay taxes
        associated with holding such Class R Certificates as they become due, fully
        understanding that it may incur tax liabilities in excess of any cash flows
        generated by the Class R Certificates.

       

      (xi)
        The
        Owner has no present knowledge that it may become insolvent or subject to
        a
        bankruptcy proceeding for so long as it holds the Class R
        Certificates.

       

      (xii)
        The
        Owner has no present knowledge or expectation that it will be unable to pay
        any
        United States taxes owed by it so long as any of the Certificates remain
        outstanding.

       

      (xiii)
        The Owner is not acquiring the Class R Certificates with the intent to transfer
        the Class R Certificates to any person or entity that will not have sufficient
        assets to pay any taxes owed by the holder of such Class R Certificates,
        or that
        may become insolvent or subject to a bankruptcy proceeding, for so long as
        the
        Class R Certificates remain outstanding.

       

      (xiv)
        The
        Owner will, in connection with any transfer that it makes of the Class R
        Certificates, obtain from its transferee the representations required by
        Section
        5.02(f) of the Pooling and Servicing Agreement under which the Class R
        Certificates were issued and will not consummate any such transfer if it
        knows,
        or knows facts that should lead it to believe, that any such representations
        are
        false.

       

      (xv)
        The
        Owner will, in connection with any transfer that it makes of the Class R
        Certificates, deliver to the Trustee an affidavit, which represents and warrants
        that it is not transferring the Class R Certificates to impede the assessment
        or
        collection of any tax and that it has no actual knowledge that the proposed
        transferee: (i) has insufficient assets to pay any taxes owed by such transferee
        as holder of the Class R Certificates; (ii) may become insolvent or subject
        to a
        bankruptcy proceeding for so long as the Class R Certificates remains
        outstanding; and (iii) is not a “Permitted Transferee”.

       

      (xvi)
        The
        Owner is 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 political subdivision thereof, or an estate or trust whose income
        from
        sources without the United States may be included in gross income for United
        States federal income tax purposes regardless of its connection with the
        conduct
        of a trade or business within the United States.

       

      (xvii)
        (a) The Owner is not an employee benefit plan or other plan subject to the
        prohibited transaction provisions of the Employee Retirement Income Security
        Act
        of 1974, as amended (“ERISA”), or Section 4975 of the Internal Revenue Code of
        1986, as amended (the “Code”), or an investment manager, named fiduciary or a
        trustee of any such plan, or any other Person acting, directly or indirectly,
        on
        behalf of or purchasing any Certificate with “plan assets” of any such plan;
        or

       

      (b)
        The
        Owner will provide the Trustee, the Company and the Master Servicer with
        an
        opinion of counsel acceptable to and in form and substance satisfactory to
        such
        entities to the effect that the purchase of Certificates is permissible under
        applicable law, will not constitute or result in any non-exempt prohibited
        transaction under ERISA or Section 4975 of the Code and will not subject
        the
        Trustee, the Depositor 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 the Pooling and Servicing
        Agreement.

       

      In
        addition, the Owner hereby certifies, represents and warrants to, and covenants
        with, the Depositor, the Trustee and the Master Servicer that the Owner will
        not
        transfer such Certificates to any Plan or person unless either such Plan
        or
        person meets the requirements set forth in either (a) or (b)
        above.

      IN
        WITNESS WHEREOF, the Owner has caused this instrument to be executed on its
        behalf, pursuant to the authority of its Board of Directors, by its [Vice]
        President, attested by its [Assistant] Secretary, this ____ day of __________,
        200___.

      

        
          	 	 	 	 	 	 	 	
                  [OWNER]

                
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                  By:

                	 
	 	 	 	 	 	 	 	
                  Name:

                	 
	 	 	 	 	 	 	 	
                  Title:

                	
                  [Vice]
                    President

                
	 	 	 	 	 	 	 	 	 
	
                  ATTEST:

                	 	 	 	 	 
	
                  By:

                	 	 	 	 
	
                  Name:

                	 	 	 	 
	
                  Title:

                	
                  [Assistant]
                    Secretary

                	 	 	 

        

      

       

       

      Personally
        appeared before me the above-named , known or proved to me to be the same
        person
        who executed the foregoing instrument and to be a [Vice] President of the
        Owner,
        and acknowledged to me that [he/she] executed the same as [his/her] free
        act and
        deed and the free act and deed of the Owner.

       

      Subscribed
        and sworn before me this ____ day of __________, 200___.

       

      
        	 	 
	 	
                Notary
                  Public

              
	 	 
	 	
                County
                  of _____________________________

              
	 	
                State
                  of _______________________________

              
	 	 
	 	
                My
                  Commission expires:

              

      

      
 

      FORM
        OF
        TRANSFEROR AFFIDAVIT

       

      
        	
                STATE
                  OF_____________

              	
                )

              	 
	 	
                )

              	
                ss.:

              
	
                COUNTY
                  OF___________

              	
                )

              	 

      

      

      ________________________,
        being duly sworn, deposes, represents and

      warrants
        as follows:

       

      1.  I
        am a
        ____________________ of _____________________________ (the “Owner”), a
        corporation duly organized and existing under the laws of ______________,
        on
        behalf of whom I make this affidavit.

       

      2.  The
        Owner
        is not transferring the Class R Certificates (the “Residual Certificates”) to
        impede the assessment or collection of any tax.

       

      3.  The
        Owner
        has no actual knowledge that the Person that is the proposed transferee (the
        “Purchaser”) of the Residual Certificates: (i) has insufficient assets to pay
        any taxes owed by such proposed transferee as holder of the Residual
        Certificates; (ii) may become insolvent or subject to a bankruptcy proceeding
        for so long as the Residual Certificates remain outstanding and (iii) is
        not a
        Permitted Transferee.

       

      4.  The
        Owner
        understands that the Purchaser has delivered to the Trustee a transfer affidavit
        and agreement in the form attached to the Pooling and Servicing Agreement
        as
        Exhibit F-4. The Owner does not know or believe that any representation
        contained therein is false.

       

      5.  At
        the
        time of transfer, the Owner has conducted a reasonable investigation of the
        financial condition of the Purchaser as contemplated by Treasury Regulations
        Section 1.860E-1(c)(4)(i) and, as a result of that investigation, the Owner
        has
        determined that the Purchaser has historically paid its debts as they became
        due
        and has found no significant evidence to indicate that the Purchaser will
        not
        continue to pay its debts as they become due in the future. The Owner
        understands that the transfer of a Residual Certificate may not be respected
        for
        United States income tax purposes (and the Owner may continue to be liable
        for
        United States income taxes associated therewith) unless the Owner has conducted
        such an investigation.

       

      6.  Capitalized
        terms not otherwise defined herein shall have the meanings ascribed to them
        in
        the Pooling and Servicing Agreement

       

      IN
        WITNESS WHEREOF, the Owner has caused this instrument to be executed on its
        behalf, pursuant to the authority of its Board of Directors, by its [Vice]
        President, attested by its [Assistant] Secretary, this ____ day of ___________,
        200___.

       

      
        	 	 	 	 	 	 	 	
                [OWNER]

              
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	
                By:

              	 
	 	 	 	 	 	 	 	
                Name:

              	 
	 	 	 	 	 	 	 	
                Title:

              	
                [Vice]
                  President

              
	 	 	 	 	 	 	 	 	 
	
                ATTEST:

              	 	 	 	 	 
	 	 	 	 	 
	
                By:

              	 	 	 	 
	
                Name:

              	 	 	 	 
	
                Title:

              	
                [Assistant]
                  Secretary

              	 	 	 

      

      

       

      Personally
        appeared before me the above-named , known or proved to me to be the same
        person
        who executed the foregoing instrument and to be a [Vice] President of the
        Owner,
        and acknowledged to me that [he/she] executed the same as [his/her] free
        act and
        deed and the free act and deed of the Owner.

       

      Subscribed
        and sworn before me this ____ day of __________, 200___.

       

      
        	 	 
	 	
                Notary
                  Public

              
	 	 
	 	
                County
                  of _____________________________

              
	 	
                State
                  of _______________________________

              
	 	 
	 	
                My
                  Commission expires:

              

      

      

       

      EXHIBIT
        G-1

       

      FORM
        OF
        ERISA REPRESENTATION LETTER

      (CLASS
        B-4, CLASS B-5 AND CLASS B-6)

       

      ______
        __, 2006

       

      PHH
        Mortgage Capital LLC

      3000
        Leadenhall Road

      Mount
        Laurel, New Jersey 08054

       

      Citibank,
        N.A.

      111
        Wall
        Street, 14th
        Floor /
        Zone 3

      New
        York,
        New York 10005

       

      PHH
        Mortgage Corporation

      3000
        Leadenhall Road

      Mount
        Laurel, New Jersey 08054

       

      
        	 	
                Re:

              	
                PHH
                  Mortgage Capital LLC 

                PHHMC
                  Mortgage Pass-Through Certificates, Series 2006-3, 

                Class
                  [B-4][B-5][B-6]

              

      

      

      Ladies
        and Gentlemen:

       

      __________________________________
        (the “Transferee”) intends to acquire from _____________________ (the
“Transferor”) $____________ Initial Certificate Principal Balance of PHH
        Mortgage Capital LLC, PHHMC Mortgage Pass-Through Certificates, Series 2006-3,
        Class ___ (the “Certificates”), issued pursuant to a Pooling and Servicing
        Agreement (the “Pooling and Servicing Agreement”) dated as of September 1, 2006
        among PHH Mortgage Capital LLC as depositor (the “Depositor”), PHH Mortgage
        Corporation as master servicer (the “Master Servicer”) and Citibank, N.A. as
        trustee (the “Trustee”). Capitalized terms used herein and not otherwise defined
        shall have the meanings assigned thereto in the Pooling and Servicing Agreement.
        

       

      The
        Transferee hereby certifies, represents and warrants to, and covenants with
        the
        Depositor, the Trustee and the Master Servicer that the following statements
        in
        either (1), (2) or (3) below are accurate (please mark the applicable statement
        with a check (ü)):

       

      _____
        (1)
        The Certificates (i) are not being acquired by, and will not be transferred
        to,
        any employee benefit plan within the meaning of section 3(3) of the Employee
        Retirement Income Security Act of 1974, as amended (“ERISA”), or other
        retirement arrangement, including individual retirement accounts and annuities,
        Keogh plans and bank collective investment funds and insurance company general
        or separate accounts in which such plans, accounts or arrangements are invested,
        that is subject to Section 406 of ERISA or Section 4975 of the Internal Revenue
        Code of 1986 (the “Code”) (any of the foregoing, a “Plan”), (ii) are not being
        acquired with “plan assets” of a Plan within the meaning of the Department of
        Labor (“DOL”) regulation, 29 C.F.R. ss. 2510.3-101, and (iii) will not be
        transferred to any entity that is deemed to be investing in plan assets within
        the meaning of the DOL regulation at 29 C.F.R.ss.2510.3-101; or

       

      _____
        (2)
        The purchase of Certificates is permissible under applicable law, will not
        subject the Depositor, the Trustee or the Master Servicer to any obligation
        in
        addition to those undertaken in the Pooling and Servicing Agreement and (i)
        the
        Transferee is an insurance company, (ii) the source of funds used to purchase
        such Certificates is an “insurance company general account” (as such term is
        defined in Prohibited Transaction Class Exemption (“PTCE”) 95-60) and (iii) the
        conditions set forth in Section III of PTCE 95-60 and all other applicable
        conditions of PTCE 95-60 have been satisfied and as a result, the acquisition
        and holding of the Certificates will not constitute or result in any prohibited
        transaction under ERISA or Section 4975 of the Code; or

       

      _____
        (3)
        The Transferee has provided the Trustee and the Master Servicer with an Opinion
        of Counsel, subject to the satisfaction of the Depositor in form and substance,
        that purchase of the Certificates (i) is permissible under applicable law,
        (ii)
        will not constitute or result in a non-exempt prohibited transaction under
        ERISA
        or Section 4975 of the Code, and (iii) will not subject the Depositor, the
        Trustee or the Master Servicer to any obligation or liability (including
        obligations or liabilities arising under ERISA or Section 4975 of the Code)
        in
        addition to those undertaken in the Pooling and Servicing
        Agreement.

      
        	 	 	 
	 	
                Very
                  truly yours,

              
	 
 	 
 	 
 
	 	 	By:
	 	
                
                  

                

              
	 	
                Name: 

                
                  Title: 

                

              

      

       

       

      EXHIBIT
        G-2

      

      FORM
        OF
        ERISA REPRESENTATION LETTER

      (CLASS
        A-6, CLASS A-7 AND CLASS A-8, CLASS B-1, CLASS B-2 AND CLASS B-3)

      

      _____
        __,
        2006

      

      PHH
        Mortgage Capital LLC

      3000
        Leadenhall Road

      Mount
        Laurel, New Jersey 08054

      

      Citibank,
        N.A.

      111
        Wall
        Street, 14th
        Floor /
        Zone 3

      New
        York,
        New York 10005

       

      PHH
        Mortgage Corporation

      3000
        Leadenhall Road

      Mount
        Laurel, New Jersey 08054

      

      
        	 	
                Re:

              	
                PHH
                  Mortgage Capital LLC 

                PHHMC
                  Mortgage Pass-Through Certificates, Series 2006-3, Class [A-6]
                  [A-7] [A-8]
                  [B-1] [B-2] [B-3]

              

      

      

      Ladies
        and Gentlemen:

      

      __________________________________
        (the “Transferee”) intends to acquire from _____________________ (the
“Transferor”) $____________ Initial Certificate Principal Balance of PHH
        Mortgage Capital LLC, PHHMC Mortgage Pass-Through Certificates, Series 2006-3,
        Class ____ (the “Certificates”), issued pursuant to a Pooling and Servicing
        Agreement (the “Pooling and Servicing Agreement”) dated as of September 1, 2006
        among PHH Mortgage Capital LLC as depositor (the “Depositor”), PHH Mortgage
        Corporation as master servicer (the “Master Servicer”) and Citibank, N.A. as
        trustee (the “Trustee”). Capitalized terms used herein and not otherwise defined
        shall have the meanings assigned thereto in the Pooling and Servicing Agreement.
        

      

      The
        Transferee hereby certifies, represents and warrants to, and covenants with
        the
        Depositor, the Trustee and the Master Servicer that the following statements
        in
        either (1) or (2) below are accurate (please mark the applicable statement
        with
        a check (T)):

      

      _____
        (1)
        The Certificates (1) are not being acquired by, and will not be transferred
        to,
        any employee benefit plan with the meaning of section 3(3) of the Employee
        Retirement Income Security Act of 1974, as amended (“ERISA”), or other
        retirement arrangement, including individual retirement accounts and annuities,
        Keogh plans and bank collective investment funds and insurance company general
        or separate accounts in which such plans, accounts or arrangements are invested,
        that is subject to Section 406 of ERISA or Section 4975 of the Internal Revenue
        Code of 1986 (the “Code”) (any of the foregoing, a “Plan”), (ii) are not being
        acquired with “plan assets” of a Plan within the meaning of the Department of
        Labor (“DOL”) regulation, 29 C.F.R. ss. 2510.3-101, and (iii) will not be
        transferred to any entity that is deemed to be investing in plan assets within
        the meaning of the DOL regulation at 29 C.F.R. ss. 2510.3-101; or

      

      _____
        (2)
        The Transferee is an “accredited investor” as defined in Rule 501(a)(1) of
        Regulation D of the Securities and Exchange Commission under the Securities
        Act
        of 1933 (the “Securities Act”) and, so long as the Transferee (or any transferee
        of the Transferee’s Certificates) is required to obtain from its transferee a
        representation regarding compliance with the Securities Act, the Transferee
        will
        require its transferee to make such representation in writing.

      
        	 	 	 
	 	
                Very
                  truly yours,

              
	 
 	 
 	 
 
	 	 	By: 
	 	
                
                  

                

              
	 	
                Name: 

                
                  Title: 

                

              

       

      EXHIBIT
        H

       

      FORM
        OF
        LOST NOTE AFFIDAVIT

       

      [Name
        of
        Seller], a ______________ corporation (the “Mortgage Loan Seller”), by its
        undersigned authorized representative, hereby certifies:

       

      Pursuant
        to the Mortgage Loan Purchase Agreement, dated _______________, between the
        Seller [PHH Mortgage Corporation] [Bishop’s Gate Residential Mortgage Trust] and
        PHH Mortgage Capital LLC (the “Depositor”), the Seller is granting all of its
        right, title and interest in and to the Mortgage Loan identified below to
        the
        Depositor. Terms used but not defined herein have the respective meanings
        assigned to them in the Mortgage Loan Purchase Agreement.

       

      Mortgage
        Loan Number:

      Maker:

      Original
        Principal Amount:

      Original
        Mortgage Note Date:

      Maturity
        Date:

       

      The
        Seller is the current owner and holder of the indebtedness evidenced by the
        original Mortgage Note.

       

      After
        diligent search, the Seller has been unable to locate the original Mortgage
        Note
        and believes it to be lost or misplaced.

       

      A
        true,
        complete and correct photocopy of the original Mortgage Note is attached
        hereto.

       

      If
        at any
        time the Seller locates the original Mortgage Note, the Mortgage Loan Seller
        shall endorse such original Mortgage Note in the following form: “Pay to the
        order of [Name of Trustee], as Trustee for the registered holders of PHH
        Mortgage Capital LLC, Mortgage Pass-Through Certificates, PHHMC Series 2006-3,
        without recourse,” and shall promptly deliver to the Trustee the original
        Mortgage Note so endorsed, with all prior and intervening endorsements showing
        a
        complete chain of endorsement from the originator to the Seller.

       

      The
        Seller hereby indemnifies the Depositor, the Trustee and the Certificateholders
        from and against any and all losses, liabilities, damages, claims or expenses
        of
        whatever kind (including without limitation attorneys’ fees and disbursements)
        arising from or in connection with the Seller’s failure to have delivered the
        original Mortgage Note (as required under the Mortgage Loan Purchase Agreement)
        to the Trustee as designee of the Depositor, including without limitation
        any
        such losses, liabilities, damages, claims or expenses arising from or in
        connection with any claim by any third party who is the holder of such
        indebtedness by virtue of its possession of such original Mortgage
        Note.

      This
        Lost
        Note Affidavit shall inure to the benefit of the Depositor, the Trustee and
        the
        Certificateholders and their respective successors and permitted
        assigns.

       

      Dated:

      
        	 	 	 
	 	
                [Seller]

              
	 
 	 
 	 
 
	 	 	By:       
                ___________________________________
	 	Name: 
                 ___________________________________
	 	
                Title:    
                  ___________________________________

              

      

       

      

      EXHIBIT
        I-1

       

      FORM
        OF
        TRUSTEE’S INITIAL CERTIFICATION

       

      _________
        __, 2006

       

      PHH
        Mortgage Capital LLC

      3000
        Leadenhall Road

      Mount
        Laurel, New Jersey 08054

       

      PHH
        Mortgage Corporation

      3000
        Leadenhall Road

      Mount
        Laurel, New Jersey 08054

       

      
        	 	
                Re:

              	
                Pooling
                  and Servicing Agreement, dated as of September 1, 2006, 

                among
                  PHH Mortgage Capital LLC, as depositor, PHH Mortgage 

                Corporation
                  as master servicer and Citibank, N.A., as Trustee, PHHMC 

                Mortgage
                  Pass-Through Certificates, Series
                  2006-3

              

      

      

      Ladies
        and Gentlemen:

       

      Attached
        is the Trustee’s preliminary exception report delivered in accordance with
        Section 2.02 of the referenced Pooling and Servicing Agreement (the “Pooling and
        Servicing Agreement”). Capitalized terms used but not otherwise defined herein
        shall have the meanings set forth in the Pooling and Servicing
        Agreement.

       

      The
        Trustee has made no independent examination of any documents contained in
        each
        Mortgage File beyond the review specifically required in the Pooling and
        Servicing Agreement. The Trustee makes no representations as to (i) the
        validity, legality, sufficiency, enforceability or genuineness of any of
        the
        documents contained in the Mortgage File pertaining to the Mortgage Loans
        identified on the Mortgage Loan Schedule, (ii) the collectability, insurability,
        effectiveness or suitability of any such Mortgage Loan or (iii) whether any
        Mortgage File included any of the documents specified in Section 2.01 of
        the
        Pooling and Servicing Agreement.

      
        	 	 	 
	 	
                
                  [______________]

                

              
	 
 	 
 	 
 
	 	 	By: 
	 	
                
                  

                

              
	 	
                Name: 

                
                  Title: 

                

              

      

      

      
 

      EXHIBIT
        I-2

       

      FORM
        OF
        TRUSTEE FINAL CERTIFICATION

       

      _________________,
        2006

       

      PHH
        Mortgage Capital LLC

      3000
        Leadenhall Road

      Mount.
        Laurel, New Jersey 08054

       

      PHH
        Mortgage Corporation

      3000
        Leadenhall Road

      Mount
        Laurel, New Jersey 08054

       

      
        	 	
                Re:

              	
                Pooling
                  and Servicing Agreement, dated as of September 1, 2006, among PHH
                  Mortgage
                  Capital LLC, as depositor, PHH Mortgage Corporation, as master
                  servicer
                  and Citibank, N.A., as Trustee, PHHMC Mortgage Pass-Through Certificates,
                  Series 2006-3

              

      

      

       

      Ladies
        and Gentlemen:

       

      In
        accordance with Section 2.02 of the above-captioned Pooling and Servicing
        Agreement, the undersigned, hereby certifies that, except as noted on the
        Schedule of Exceptions attached hereto, for each Mortgage Loan listed on
        the
        Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed
        on
        the attachment hereto), it has received a complete Mortgage File which includes
        the documents required to be included in the Mortgage File as set forth in
        the
        Pooling and Servicing Agreement.

       

      The
        undersigned has made no independent examination of any documents contained
        in
        each Mortgage File beyond the review specifically required in the
        above-referenced Pooling and Servicing Agreement. The undersigned makes no
        representation as to: (i) the validity, legality, sufficiency, enforceability
        or
        genuineness of any documents contained in any Mortgage File for any of the
        Mortgage Loans listed on the Mortgage Loan Schedule to the Pooling and Servicing
        Agreement, (ii) the collectability, insurability, effectiveness or suitability
        of any such Mortgage Loan or (iii) whether any Mortgage File should include
        any
        flood insurance policy, any rider, addenda, surety or guaranty agreement,
        power
        of attorney, buy down agreement, assumption agreement, modification agreement,
        written assurance or substitution agreement.

       

      Capitalized
        words and phrases used herein shall have the respective meanings assigned
        to
        them in the above-captioned Pooling and Servicing Agreement.

      
        	 	 	 
	 	
                
                  
                    [______________],
                      as Trustee

                  

                

              
	 
 	 
 	 
 
	 	 	By: 
	 	
                
                  

                

              
	 	
                Name: 

                
                  Title: 

                

              

      

      

      
 

      EXHIBIT
        J

       

      MORTGAGE
        LOAN PURCHASE AGREEMENT

       

      This
        MORTGAGE LOAN PURCHASE AGREEMENT (this “Agreement”), dated as of September 1,
        2006, is made among PHH Mortgage Capital LLC (the “Purchaser”), PHH Mortgage
        Corporation (“PHH Mortgage”) and Bishop’s Gate Residential Mortgage Trust
        (“BGRMT,” together with PHH Mortgage, the “Sellers” and individually, each a
“Seller”).

       

      W I T N E
60;S S E T H:

       

      WHEREAS,
        the Sellers own the Mortgage Loans indicated on the Mortgage Loan Schedule
        attached as Exhibit 1 hereto (the “Mortgage Loans”), including rights to (a) any
        property acquired by foreclosure or deed in lieu of foreclosure or otherwise,
        and (b) the proceeds of any insurance policies covering the Mortgage
        Loans;

       

      WHEREAS,
        the parties hereto desire that the Sellers sell the Mortgage Loans to the
        Purchaser (other than the servicing rights with respect thereto), effective
        as
        of the Closing Date, and that the Sellers make certain representations and
        warranties and undertake certain obligations with respect to the Mortgage
        Loans;

       

      WHEREAS,
        pursuant to the terms of a Pooling and Servicing Agreement (the “Pooling and
        Servicing Agreement”) dated as of September 1, 2006 (the “Cut-off Date”), among
        the Purchaser, as depositor, PHH Mortgage Corporation, as master servicer
        (the
“Master Servicer”) and Citibank, N.A., as trustee (the “Trustee”), the Purchaser
        will issue the PHHMC Mortgage Pass-Through Certificates, Series 2006-3 (the
        “Certificates”);

       

      NOW,
        THEREFORE, in consideration of the mutual covenants herein contained, the
        parties hereto agree as follows:

       

       

      I.

      DEFINITIONS

       

      A.  Definitions.
        For all
        purposes of this Mortgage Loan Purchase 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
        the
        Pooling and Servicing Agreement. All other capitalized terms used herein
        shall
        have the meanings specified herein.

       

       

      II.

       

      SALE
        OF
        MORTGAGE LOANS AND RELATED PROVISIONS

       

      A.  Sale
        of Mortgage Loans.

       

      1.  The
        Sellers, by the execution and delivery of this Agreement, do hereby sell,
        and in
        connection therewith hereby assign, to the Purchaser, effective as of the
        Closing Date, without recourse but subject to the terms of this Agreement,
        all
        of its right, title and interest in, to and under the Mortgage Loans identified
        on Exhibit 1 as of the Closing Date, whether now existing or hereafter acquired
        and wherever located, on the Closing Date and as of the Cut-off Date. In
        addition, PHH Mortgage hereby assigns to the Purchaser all of its right,
        title
        and interest in and to the Additional Collateral Servicing Agreement with
        respect to the Additional Collateral Mortgage Loans, which right, title and
        interest shall be assigned by the Purchaser to the Trustee, for the benefit
        of
        the Certificateholders, pursuant to the Pooling and Servicing
        Agreement.

       

      2.  In
        connection with such conveyances by each Seller, the applicable Seller shall
        on
        behalf of the Purchaser deliver to, and deposit with the Trustee (or the
        Master
        Servicer, in which case the Master Servicer shall hold such documents in
        trust
        for the use and benefit of all present and future Certificateholders until
        such
        time as set forth in Section 2.01 of the Pooling and Servicing Agreement),
        on or
        before the Closing Date, the following documents or instruments with respect
        to
        each Mortgage Loan:

       

      (i)  with
        respect to each Mortgage Loan, other than a Cooperative Loan:

       

      (a)  the
        original Mortgage Note, endorsed “Pay to the order of Citibank, N.A., as Trustee
        for the registered holders of the PHHMC Mortgage Pass-Through Certificates,
        Series 2006-3, without recourse”, or endorsed “Pay to the order of _______
        without recourse”, and signed in the name of the last named endorsee by an
        authorized officer together with all prior and intervening endorsements showing
        a complete chain of endorsement from the originator to the last
        endorsee;

       

      (b)  the
        original Mortgage, noting the presence of the MIN of the Mortgage Loan and
        language indicating that the Mortgage Loan is a MOM Loan if the Mortgage
        Loan is
        a MOM Loan, with evidence of recording thereon which have been recorded,
        with
        evidence of recording thereon or a copy of the Mortgage certified by the
        public
        recording office in which such Mortgage has been recorded;

       

      (c)  Unless
        the Mortgage Loan is registered on the MERS® System, an original Assignment of
        the Mortgage (A) executed in the following form “Citibank, N.A., as Trustee for
        the registered holders of the PHHMC Mortgage Pass-Through Certificates, Series
        2006-3”, or (B) in the blank, which assignment appears to be in form and
        substance acceptable for recording;

       

      (d)  the
        original recorded Assignment or Assignments of the Mortgage showing a complete
        chain of assignment from the originator to the Person assigning the Mortgage
        to
        the Trustee (or to MERS, if the Mortgage Loan is registered on the MERS® System
        and noting the presence of a MIN) as contemplated by the immediately preceding
        clause (C), if applicable and only to the extent available to the Depositor
        with
        evidence of recording thereon;

       

      (e)  the
        originals of all assumption, modification, consolidation or extension
        agreements, with evidence of recording thereon, if any;

       

      (f)  a
        copy of
        any guarantee (other than Additional Collateral) executed in connection with
        the
        Mortgage Note;

       

      (g)  the
        original of any security agreement, chattel mortgage or equivalent document
        executed in connection with the Mortgage;

       

      (h)  the
        original power of attorney, if applicable; and

       

      (i)  if
        such
        Mortgage Loan is a Buydown Mortgage Loan (as shown in the Mortgage Loan
        Schedule), the original Buydown Agreement or a copy thereof;

       

      (ii)  in
        addition, with respect to each Mortgage Loan that is an Additional Collateral
        Mortgage Loan:

       

      (a)  a
        copy of
        the related Mortgage 100K
        Pledge
        Agreement or Parent Power Agreement, as applicable; and

       

      (b)  a
        copy of
        the related UCC-1, to the extent that MLCC was required to deliver such UCC-1
        to
        the Master Servicer, and an original form UCC-3, if applicable, to the extent
        that MLCC was required to deliver such UCC-3 to the Master Servicer;
        or

       

      (iii)  with
        respect to each Mortgage Loan that is a Cooperative Loan:

       

      (a)  the
        original Mortgage Note, endorsed “Pay to the order of Citibank, N.A., as Trustee
        for the registered holders of the PHHMC Mortgage Pass-Through Certificates,
        Series 2006-3, without recourse”, or endorsed “Pay to the order of _______
        without recourse”, and signed in the name of the last named endorsee by an
        authorized officer together with all prior and intervening endorsements showing
        a complete chain of endorsement from the originator to the last
        endorsee;

       

      (b)  the
        original duly executed assignment of Security Agreement to the
        Trustee;

       

      (c)  the
        acknowledgment copy of the original executed Form UCC-1 (or certified copy
        thereof) with respect to the Security Agreement, and any required continuation
        statements;

       

      (d)  the
        acknowledgment copy of the original executed Form UCC-3 with respect to the
        Security Agreement, indicating the Trustee as the assignee of the secured
        party;

       

      (e)  the
        stock
        certificate representing the Cooperative Assets allocated to the cooperative
        unit, with a stock power in blank attached;

       

      (f)  the
        original collateral assignment of the proprietary lease by Mortgagor to the
        originator;

       

      (g)  a
        copy of
        the recognition agreement;

       

      (h)  if
        applicable and to the extent available, the original intervening assignments,
        including warehousing assignments, if any, showing, to the extent available,
        an
        unbroken chain of the related Mortgage Loan to the Trustee, together with
        a copy
        of the related Form UCC-3 with evidence of filing thereon; and

       

      (i)  the
        originals of each assumption, modification or substitution agreement, if
        any,
        relating to the Mortgage Loan;

       

      provided,
        however, that in lieu of the foregoing, the applicable Seller may deliver
        the
        following documents, under the circumstances set forth below: (x) in lieu
        of the
        original Mortgage, assignments to the Trustee or intervening assignments
        thereof
        which have been delivered, are being delivered or will, upon receipt of
        recording information relating to the Mortgage required to be included thereon,
        be delivered to recording offices for recording and have not been returned
        to
        applicable Seller within 270 days of the Closing Date, applicable Seller
        may
        deliver a true copy thereof with an Officer’s Certificate certifying that such
        Mortgage, assignment to the Trustee or intervening assignment has been delivered
        to the appropriate recording office for recording; and (y) in lieu of the
        Mortgage, assignment to the Trustee or intervening assignments thereof, if
        the
        applicable jurisdiction retains the originals of such documents (as evidenced
        by
        a certification from applicable Seller, to such effect) the applicable Seller
        may deliver photocopies of such documents containing an original certification
        by the judicial or other governmental authority of the jurisdiction where
        such
        documents were recorded; and provided, further, however, that in the case
        of
        Mortgage Loans which have been prepaid in full after the Cut-off Date and
        prior
        to the Closing Date, the applicable Seller, in lieu of delivering the above
        documents, may deliver to the Trustee a certification to such effect and
        shall
        pay all amounts paid in respect of such Mortgage Loans to the Trustee on
        the
        Closing Date. The applicable Seller shall deliver such original documents
        (including any original documents as to which certified copies had previously
        been delivered) to the Trustee promptly after they are received.

       

      The
        applicable Seller may, in lieu of delivering the original of the documents
        set
        forth in Section 2.1(b)(i), (ii) and (iii) (other than Section 2.1(b)(i)(A)
        and
        Section 2.1(b)(iii)(A)) (or copies thereof as permitted by Section 2.1) to
        the
        Trustee, deliver such documents to the Master Servicer, and the Master Servicer
        shall hold such documents in trust for the use and benefit of all present
        and
        future Certificateholders until such time as is set forth in the next sentence.
        Within 60 days following the earlier of (i) the receipt of the original of
        all
        of the documents or instruments set forth in Section 2.1(b)(i), (ii) and
        (iii)
        (other than Section 2.1(b)(i)(A) and Section 2.1(b)(iii)(A)) (or copies thereof
        as permitted by such Section) for any Mortgage Loan and (ii) a written request
        by the Trustee to deliver those documents with respect to any or all of the
        Mortgage Loans then being held by the Master Servicer, the Master Servicer
        shall
        deliver a complete set of such documents to the Trustee.

       

      The
        applicable Seller shall, at its expense, cause the Assignment of the Mortgage
        to
        the Trustee to be recorded not later than 270 days after the Closing Date,
        unless (a) such recordation is not required by the Rating Agencies or an
        Opinion
        of Counsel has been provided as set forth below in this Section 2.1 or (b)
        MERS
        is identified on the Mortgage or on a properly recorded assignment of the
        Mortgage as the mortgagee of record. The applicable Seller need not cause
        to be
        recorded any assignment in any jurisdiction under the laws of which, as
        evidenced by an Opinion of Counsel delivered by the applicable Seller to
        the
        Trustee and the Rating Agencies, the recordation of such assignment is not
        necessary to protect the Trustee’s interest in the related Mortgage Loan;
        provided, however, notwithstanding the delivery of any Opinion of Counsel,
        each
        assignment shall be submitted for recording by the Seller in the manner
        described above, at no expense to the Trust Fund or the Trustee, upon the
        earliest to occur of: (i) reasonable direction by the Holders of Certificates
        evidencing Fractional Undivided Interests aggregating not less than 25% of
        the
        Trust Fund, (ii) the occurrence of a Master Servicer Event of Termination,
        (iii)
        the occurrence of a bankruptcy, insolvency or foreclosure relating to the
        applicable Seller, (iv) the occurrence of a servicing transfer as described
        in
        Section 7.02 of the Pooling and Servicing Agreement and (v) with respect
        to any
        one assignment, the occurrence of a bankruptcy, insolvency or foreclosure
        relating to the Mortgagor under the related Mortgage.

       

      If
        any
        original Mortgage Note referred to in Section 2.1(b)(i)(A) or 2.1(b)(iii)(A)
        above cannot be located, the obligations of the applicable Seller to deliver
        such documents shall be deemed to be satisfied upon delivery to the Trustee
        of a
        photocopy of such Mortgage Note, if available, with a Lost Note Affidavit.
        If
        any of the original Mortgage Notes for which a Lost Note Affidavit was delivered
        to the Trustee is subsequently located, such original Mortgage Note shall
        be
        delivered to the Trustee within three Business Days.

       

      The
        Purchaser hereby acknowledges its acceptance of all right, title and interest
        to
        the Mortgage Loans and other property, now existing and hereafter created,
        conveyed to it pursuant to this Section 2.1.

       

      B.  Payment
        of Purchase Price for the Mortgage Loans.

       

      In
        consideration of the sale of the Mortgage Loans from the Sellers to the
        Purchaser on the Closing Date, (i) PHH Mortgage shall receive (a) the Class
        R-I
        Certificates and Class R-II Certificates (other than a de minimis portion
        of
        each such class) and (b) $20,858,516.41 by wire transfer of immediately
        available funds to a bank account designated by PHH Mortgage and (ii) BGRMT
        shall receive $89,781,430.24 by wire transfer of immediately available funds
        to
        a bank account designated by BGRMT.

       

       

      III.

       

      REPRESENTATIONS
        AND WARRANTIES;

      REMEDIES
        FOR BREACH

       

      A.  Sellers
        Representations and Warranties.

       

      1.  Each
        Seller, as to itself, represents, warrants and covenants to the Purchaser
        that
        as of the Closing Date (or as of such date specifically provided herein)
        that:

       

      (i)  Due
        Organization.
        The
        Seller is an entity duly organized, validly existing and in good standing
        under
        the laws of its jurisdiction of organization, and has all licenses necessary
        to
        carry on its business now being conducted and is licensed, qualified and
        in good
        standing under the laws of each state where a Mortgaged Property is located
        or
        is otherwise exempt under applicable law from such qualification or is otherwise
        not required under applicable law to effect such qualification; no demand
        for
        such qualification has been made upon the Seller by any state having
        jurisdiction and in any event the Seller is or will be in compliance with
        the
        laws of any such state to the extent necessary to enforce each Mortgage
        Loan;

       

      (ii)  Due
        Authority.
        The
        Seller had the full power and authority and legal right to originate the
        Mortgage Loans that it originated, if any, and to acquire the Mortgage Loans
        that it acquired. The Seller has the full power and authority to hold each
        Mortgage Loan, to sell each Mortgage Loan and to execute, deliver and perform,
        and to enter into and consummate, all transactions contemplated by this
        Agreement. The Seller has duly authorized the execution, delivery and
        performance of this Agreement, has duly executed and delivered this Agreement,
        and this Agreement, assuming due authorization, execution and delivery by
        the
        Purchaser, constitutes a legal, valid and binding obligation of the Seller,
        enforceable against it in accordance with its terms, subject to applicable
        bankruptcy, reorganization, receivership, conservatorship, insolvency,
        moratorium and other laws relating to or affecting creditors’ rights generally
        or the rights of creditors of banks and to the general principles of equity
        (whether such enforceability is considered in a proceeding in equity or at
        law);

       

      (iii)  No
        Conflict.
        The
        execution and delivery of this Agreement, the acquisition or origination,
        as
        applicable, of the Mortgage Loans by the Seller, the sale of the Mortgage
        Loans,
        the consummation of the transactions contemplated hereby, or the fulfillment
        of
        or compliance with the terms and conditions of this Agreement, will not conflict
        with or result in a breach of any of the terms, conditions or provisions
        of the
        Seller’s organizational documents and bylaws or any legal restriction or any
        agreement or instrument to which the Seller is now a party or by which it
        is
        bound, or constitute a default or result in an acceleration under any of
        the
        foregoing, or result in the violation of any law, rule, regulation, order,
        judgment or decree to which the Seller or its property is subject, or impair
        the
        ability of the Purchaser to realize on the Mortgage Loans;

       

      (iv)  Ability
        to Perform.
        The
        Seller does not believe, nor does it have any reason or cause to believe,
        that
        it cannot perform each and every covenant contained in this
        Agreement;

       

      (v)  No
        Material Default.
        Neither
        the Seller nor any of its Affiliates is in material default under any agreement,
        contract, instrument or indenture of any nature whatsoever to which the Seller
        or any of its Affiliates is a party or by which it (or any of its assets)
        is
        bound, which default would have a material adverse effect on the ability
        of the
        Seller to perform under this Agreement, nor, to the best of the Seller’s
        knowledge, has any event occurred which, with notice, lapse of time or both,
        would constitute a default under any such agreement, contract, instrument
        or
        indenture and have a material adverse effect on the ability of the Seller
        to
        perform its obligations under this Agreement;

       

      (vi)  No
        Litigation Pending.
        There
        is no action, suit, proceeding or investigation pending or, to the best of
        the
        Seller’s knowledge, threatened, against the Seller, which, either in any one
        instance or in the aggregate, if determined adversely to the Seller would
        adversely affect the sale of the Mortgage Loans to the Purchaser or the
        execution, delivery or enforceability of this Agreement or result in any
        material liability of the Seller, or draw into question the validity of this
        Agreement, or have a material adverse effect on the financial condition of
        the
        Seller or the ability of the Seller to perform its obligations under this
        Agreement;

       

      (vii)  No
        Consent Required.
        No
        consent, approval, authorization or order of any court or governmental agency
        or
        body is required for the execution, delivery and performance by the Seller
        of or
        compliance by the Seller with this Agreement, the delivery of the Mortgage
        Files
        to the Purchaser, the sale of the Mortgage Loans to the Purchaser or the
        consummation of the transactions contemplated by this Agreement or, if required,
        such approval has been obtained prior to the Closing Date;

       

      (viii)  Ordinary
        Course of Business.
        The
        consummation of the transactions contemplated by this Agreement is in the
        ordinary course of business of the Seller, and the transfer, assignment and
        conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant
        to
        this Agreement are not subject to the bulk transfer or any similar statutory
        provisions in effect in any applicable jurisdiction;

       

      (ix)  No
        Broker.
        The
        Seller has not dealt with any broker or agent or anyone else who might be
        entitled to a fee or commission in connection with this transaction;
        and

       

      (x)  No
        Untrue Information.
        Neither
        this Agreement nor any statement, report or other agreement, document or
        instrument furnished or to be furnished pursuant to this Agreement contains
        or
        will contain any materially untrue statement of fact or omits or will omit
        to
        state a fact necessary to make the statements contained therein, in light
        of the
        circumstances under which they were made, not misleading.

       

      2.  With
        respect to each Mortgage Loan, the applicable Seller hereby makes the following
        representations and warranties to the Purchaser on which the Purchaser
        specifically relies in purchasing such Mortgage Loan. Such representations
        and
        warranties speak as of the Closing Date (unless otherwise indicated), but shall
        survive any subsequent transfer, assignment or conveyance of such Mortgage
        Loans:

       

      (i)  Such
        Mortgage Loan complies with the terms and conditions set forth herein, and
        all
        of the information set forth with respect thereto on the Mortgage Loan Schedule
        is true and correct in all material respects;

       

      (ii)  The
        instruments and documents specified in Section 2.1 with respect to such Mortgage
        Loan have been delivered to the Purchaser in accordance with the requirements
        of
        Section 2.1(b). The applicable Seller is in possession of a Mortgage File
        respecting such Mortgage Loan, except for such documents as have been previously
        delivered to the Purchaser;

       

      (iii)  The
        Mortgage relating to such Mortgage Loan has been duly recorded in the
        appropriate recording office, and the applicable Seller is the owner of record
        of such Mortgage Loan and the indebtedness evidenced by the related Mortgage
        Note;

       

      (iv)  All
        payments required to be made up to and including the Closing Date for such
        Mortgage Loan under the terms of the Mortgage Note have been made, such that
        such Mortgage Loan is not delinquent 30 days or more on the Cut-off Date.
        Unless
        otherwise disclosed in the prospectus supplement, dated September 26, 2006,
        relating to the public offering of the Certificates (the “Prospectus
        Supplement”) or the Mortgage Loan Schedule, there has been no delinquency,
        exclusive of any period of grace, in any payment by the Mortgagor thereunder
        during the twelve months preceding the Closing Date; and, if the Mortgage
        Loan
        is a Cooperative Loan, no foreclosure action or private or public sale under
        the
        Uniform Commercial Code has ever been overtly threatened or commenced with
        respect to the Cooperative Loan;

       

      (v)  There
        are
        no delinquent taxes, insurance premiums, assessments, including assessments
        payable in future installments, or other outstanding charges affecting the
        Mortgaged Property related to such Mortgage Loan;

       

      (vi)  The
        terms
        of the Mortgage Note and the Mortgage related to such Mortgage Loan (and
        the
        proprietary lease, the stock power, the Assignment of the proprietary lease,
        the
        Assignment of the Mortgage Note and the acceptance of assignment and assumption
        of lease agreement with respect to each Cooperative Loan), have not been
        impaired, waived, altered or modified in any material respect, except as
        specifically set forth in the Mortgage Loan Schedule;

       

      (vii)  The
        Mortgage Note and the Mortgage related to such Mortgage Loan (and the acceptance
        of assignment and assumption of lease agreement related to each Cooperative
        Loan) are not subject to any right of rescission, set-off or defense, including
        the defense of usury, nor will the operation of any of the terms of such
        Mortgage Note and such Mortgage, or the exercise of any right thereunder,
        render
        such Mortgage unenforceable, in whole or in part, or subject to any right
        of
        rescission, set-off or defense, including the defense of usury and no such
        right
        of rescission, set-off or defense has been asserted with respect
        thereto;

       

      (viii)  
        (a) All
        buildings upon the Mortgaged Property related to such Mortgage Loan are insured
        by a Qualified Insurer against loss by fire, hazards of extended coverage
        and
        such other hazards as are customary in the area where such Mortgaged Property
        is
        located. All such insurance policies (collectively, the “hazard insurance
        policy”) are in full force and effect and contain a standard mortgagee clause
        naming the originator of such Mortgage Loan, its successors and assigns,
        as
        mortgagee. If the Mortgaged Property is in an area identified in the Federal
        Register by the Federal Emergency Management Agency (“FEMA”) as having special
        flood hazards, a flood insurance policy is in effect which met the requirements
        of FEMA at the time such policy was issued. Such policies are the valid and
        binding obligations of the insurer, and all premiums thereon due to date
        have
        been paid. The related Mortgage obligates the Mortgagor thereunder to maintain
        all such insurance at such Mortgagor’s cost and expense, and on such Mortgagor’s
        failure to do so, authorizes the holder of such Mortgage to maintain such
        insurance at such Mortgagor’s cost and expense and to seek reimbursement
        therefor from such Mortgagor; or (b) in the case of a condominium or unit
        in a
        planned unit development (“PUD”) project that is not covered by an individual
        policy, the condominium or PUD project is covered by a “master” or “blanket”
policy and there exists and is in the Mortgage File a certificate of insurance
        showing that the individual unit that secures the first mortgage is covered
        under such policy. The insurance policy contains a standard mortgagee clause
        naming the originator of such Mortgage Loan (and its successors and assigns),
        as
        insured mortgagee. Such policies are the valid and binding obligations of
        the
        insurer, and all premiums thereon have been paid. The insurance policy provides
        for advance notice to the applicable Seller or Master Servicer if the policy
        is
        canceled or not renewed, or if any other change that adversely affects the
        applicable Seller’s interests is made; the certificate includes the types and
        amounts of coverage provided, describes any endorsements that are part of
        the
“master” policy and would be acceptable pursuant to the Fannie Mae
        Guide;

       

      (ix)  All
        requirements of any federal, state or local law (including usury, truth in
        lending, real estate settlement procedures, consumer credit protection, equal
        credit opportunity or disclosure laws) applicable to the origination and
        servicing of such Mortgage Loan have been complied with in all material
        respects;

       

      (x)  The
        Mortgage related to such Mortgage Loan has not been satisfied, canceled or
        subordinated, in whole or in part, or rescinded, and the related Mortgaged
        Property has not been released from the lien of such Mortgage, in whole or
        in
        part, nor has any instrument been executed that would effect any such release,
        cancellation, subordination or rescission;

       

      (xi)  The
        Mortgage related to such Mortgage Loan is a valid, subsisting and enforceable
        perfected first lien on the related Mortgaged Property, including all
        improvements on the related Mortgaged Property, which Mortgaged Property
        is free
        and clear of any encumbrances and liens having priority over the first lien
        of
        the Mortgage subject only to (a) the lien of current real estate taxes and
        special assessments not yet due and payable, (b) covenants, conditions and
        restrictions, rights of way, easements and other matters of the public record
        as
        of the date of recording of such Mortgage which are acceptable to mortgage
        lending institutions generally, are referred to in the lender’s title insurance
        policy and do not adversely affect the market value or intended use of the
        related Mortgaged Property, and (c) other matters to which like properties
        are
        commonly subject which do not individually or in the aggregate materially
        interfere with the benefits of the security intended to be provided by such
        Mortgage or the use, enjoyment, or market value of the related Mortgaged
        Property; with respect to each Cooperative Loan, each acceptance of assignment
        and assumption of lease agreement creates a valid, enforceable and subsisting
        first security interest in the collateral securing the related Mortgage Note
        subject only to (x) the lien of the related Cooperative for unpaid assessments
        representing the obligor’s pro rata share of the Cooperative’s payments for its
        blanket mortgage, current and future real property taxes, insurance premiums,
        maintenance fees and other assessments to which like collateral is commonly
        subject and (y) other matters to which like collateral is commonly subject
        which
        do not materially interfere with the benefits of the security intended to
        be
        provided by the acceptance of assignment and assumption of lease agreement;
        provided, however, that the appurtenant proprietary lease may be subordinated
        or
        otherwise subject to the lien of any mortgage on the cooperative
        project;

       

      (xii)  The
        Mortgage Note and the Mortgage related to such Mortgage Loan (and the acceptance
        of assignment and assumption of lease agreement with respect to each Cooperative
        Loan) are genuine and each is the legal, valid and binding obligation of
        the
        maker thereof, enforceable in accordance with its terms, except as such
        enforcement may be limited by bankruptcy, insolvency, reorganization or other
        similar laws affecting the enforcement of creditors’ rights generally and
        general equitable principles (regardless whether such enforcement is considered
        in a proceeding in equity or at law);

       

      (xiii)  All
        parties to the Mortgage Note and the Mortgage related to such Mortgage Loan
        had
        legal capacity to enter into such Mortgage Loan and to execute and deliver
        the
        related Mortgage Note and the related Mortgage and the related Mortgage Note
        and
        the related Mortgage have been duly and properly executed by such parties;
        with
        respect to each Cooperative Loan, all parties to the Mortgage Note and the
        Mortgage Loan had legal capacity to execute and deliver the Mortgage Note,
        the
        acceptance of assignment and assumption of lease agreement, the proprietary
        lease, the stock power, the recognition agreement, the financing statement
        and
        the Assignment of proprietary lease and such documents have been duly and
        properly executed by such parties; each stock power (i) has all signatures
        guaranteed or (ii) if all signatures are not guaranteed, then such Cooperative
        Assets will be transferred by the stock transfer agent of the Cooperative
        if the
        applicable Seller undertakes to convert the ownership of the collateral securing
        the related Cooperative Loan;

       

      (xiv)  Such
        Mortgage Loan has closed and the proceeds of such Mortgage Loan have been
        fully
        disbursed prior to the Closing Date; provided that, with respect to any Mortgage
        Loan originated within the previous 150 days, alterations and repairs with
        respect to the related Mortgaged Property or any part thereof may have required
        an escrow of funds in an amount sufficient to pay for all outstanding work
        within 150 days of the origination of such Mortgage Loan, and, if so, such
        funds
        are held in escrow by the applicable Seller, a title company or other escrow
        agent;

       

      (xv)  The
        Mortgage Note and the Mortgage related to such Mortgage Loan have not been
        assigned, pledged or otherwise transferred by the applicable Seller, in whole
        or
        in part, and the applicable Seller has good and marketable title thereto,
        and
        the applicable Seller is the sole owner thereof (and with respect to any
        Cooperative Loan, the sole owner of the related acceptance of assignment
        and
        assumption of lease agreement) and has full right and authority to transfer
        and
        sell such Mortgage Loan, and is transferring such Mortgage Loan to the Purchaser
        free and clear of any encumbrance, equity, lien, pledge, charge, claim or
        security interest;

       

      (xvi)  All
        parties that have had any interest in such Mortgage Loan, whether as mortgagee,
        assignee, pledgee or otherwise, are (or, during the period in which they
        held
        and disposed of such interest, were) in compliance with any and all applicable
        licensing requirements of the laws of the state wherein the related Mortgaged
        Property is located;

       

      (xvii)  (a)
        Such
        Mortgage Loan is covered by an American Land Title Association (“ALTA”) lender’s
        title insurance policy or short form title policy acceptable to Fannie Mae
        and
        Freddie Mac (or, in jurisdictions where ALTA policies are not generally approved
        for use, a lender’s title insurance policy acceptable to Fannie Mae and Freddie
        Mac), issued by a title insurer acceptable to Fannie Mae and Freddie Mac
        and
        qualified to do business in the jurisdiction where the related Mortgaged
        Property is located, insuring (subject to the exceptions contained in clauses
        (xi)(a), (b) and (x) above) the applicable Seller or Master Servicer, its
        successors and assigns as to the first priority lien of the related Mortgage
        in
        the original principal amount of such Mortgage Loan. Additionally, either
        such
        lender’s title insurance policy affirmatively insures that there is ingress and
        egress to and from the Mortgaged Property or the applicable Seller warrants
        that
        there is ingress and egress to and from the Mortgaged Property and the lender’ s
        title insurance policy affirmatively insures against encroachments by or
        upon
        the related Mortgaged Property or any interest therein or any other adverse
        circumstance that either is disclosed or would have been disclosed by an
        accurate survey. The applicable Seller or Master Servicer is the sole insured
        of
        such lender’s title insurance policy, and such lender’s title insurance policy
        is in full force and effect and will be in full force and effect upon the
        consummation of the transactions contemplated by this Agreement and will
        inure
        to the benefit of the Purchaser without any further act. No claims have been
        made under such lender’s title insurance policy, neither the applicable Seller,
        nor to the best of the applicable Seller’s knowledge, any prior holder of the
        related Mortgage has done, by act or omission, anything that would impair
        the
        coverage of such lender’s insurance policy, and there is no act, omission,
        condition, or information that would impair the coverage of such lender’s
        insurance policy; (b) The mortgage title insurance policy covering each unit
        mortgage in a condominium or PUD project related to such Mortgage Loan meets
        all
        requirements of Fannie Mae and Freddie Mac;

       

      (xviii)  
        (a)
        There is no default, breach, violation or event of acceleration existing
        under
        the Mortgage, the Mortgage Note, or any other agreements, documents, or
        instruments related to such Mortgage Loan; (b) to the best of the applicable
        Seller’s knowledge, there is no event that, with the lapse of time, the giving
        of notice, or both, would constitute such a default, breach, violation or
        event
        of acceleration; (c) the Mortgagor(s) with respect to such Mortgage Loan
        is (1)
        not in default under any other Mortgage Loan or (2) the subject of an insolvency
        proceeding; (d) no event of acceleration has previously occurred, and no
        notice
        of default has been sent, with respect to such Mortgage Loan; and (e) in
        no
        event has the applicable Seller waived any of its rights or remedies in respect
        of any default, breach, violation or event of acceleration under the Mortgage,
        the Mortgage Note, or any other agreements, documents, or instruments related
        to
        such Mortgage Loan; and (f) with respect to each Cooperative Loan, there
        is no
        default in complying with the terms of the Mortgage Note, the acceptance
        of
        assignment and assumption of lease agreement and the proprietary lease and
        all
        maintenance charges and assessments (including assessments payable in the
        future
        installments, which previously became due and owing) have been paid, and
        the
        applicable Seller has the right under the terms of the Mortgage Note, acceptance
        of assignment and assumption of lease agreement and recognition agreement
        to pay
        any maintenance charges or assessments owed by the Mortgagor;

       

      (xix)  As
        of the
        date of origination of such Mortgage Loan, there were no mechanics’ or similar
        liens, except such liens as are expressly insured against by a title insurance
        policy, or claims that have been filed for work, labor or material (and no
        rights are outstanding that under law could give rise to such lien) affecting
        the related Mortgaged Property that are or may be liens prior to, or equal
        or
        coordinate with, the lien of the related Mortgage;

       

      (xx)  As
        of the
        date of origination of such Mortgage Loan, to the best of the applicable
        Seller’s knowledge, all improvements that were considered in determining the
        Value of the related Mortgaged Property lay wholly within the boundaries
        and
        building restriction lines of such Mortgaged Property (and wholly within
        the
        project in the case of a condominium unit), and no improvements on adjoining
        properties encroach upon such Mortgaged Property except as permitted under
        the
        terms of the Fannie Mae Guide and the Freddie Mac Selling Guide or those
        which
        are insured against by the title insurance policy referred to in clause (xvii)
        above; to the best of the applicable Seller’s knowledge, no improvement located
        on or part of any Mortgaged Property is in violation of any applicable zoning
        law or regulation, and all inspections, licenses and certificates required
        to be
        made or issued with respect to all occupied portions of such Mortgaged Property,
        and with respect to the use and occupancy of the same, including certificates
        of
        occupancy, have been made or obtained from the appropriate
        authorities;

       

      (xxi)  Except
        with respect to approximately 8.32% of the Mortgage Loans for which the related
        Mortgage Note provides for an initial interest-only period for the first
        10
        years, principal payments on such Mortgage Loan commenced or will commence
        no
        more than 60 days after funds were disbursed in connection with such Mortgage
        Loan. The related Mortgage Note is payable on the first day of each month
        in
        arrears, in accordance with the payment terms described on the related Mortgage
        Loan Schedule;

       

      (xxii)  Except
        as
        noted otherwise on the Mortgage Loan Schedule, the related Mortgage contains
        the
        usual and customary “due-on-sale” clause or other similar provision for the
        acceleration of the payment of the unpaid principal balance of such Mortgage
        Loan if the related Mortgaged Property or any interest therein is sold or
        transferred without the prior consent of the mortgagee thereunder;

       

      (xxiii)  Except
        as
        noted otherwise on the Mortgage Loan Schedule, such Mortgage Loan is not
        subject
        to any prepayment penalty;

       

      (xxiv)  To
        the
        best of the applicable Seller’s knowledge, as of the Closing Date, the related
        Mortgaged Property (and with respect to a Cooperative Loan, the related
        cooperative project and Cooperative Unit) is free of material damage and
        waste
        and there is no proceeding pending for the total or partial condemnation
        thereof;

       

      (xxv)  The
        related Mortgage contains customary and enforceable provisions that render
        the
        rights and remedies of the holder thereof adequate for the realization against
        the related Mortgaged Property of the benefits of the security provided thereby,
        including, (a) in the case of a Mortgage designated as a deed of trust, by
        trustee’s sale, and (b) in the case of a Mortgage, otherwise by judicial
        foreclosure;

       

      (xxvi)  Such
        Mortgage Loan was underwritten in accordance with the Underwriting
        Guide;

       

      (xxvii)  The
        Mortgage File contains an appraisal (or other collateral assessment, permitted
        by the Underwriting Guide) of the related Mortgaged Property on forms and
        with
        riders approved by Fannie Mae and Freddie Mac, signed prior to the approval
        of
        such Mortgage Loan application by an appraiser, duly appointed by the originator
        of such Mortgage Loan, whose compensation is not affected by the approval
        or
        disapproval of such Mortgage Loan and who met the minimum qualifications
        of
        Fannie Mae and Freddie Mac for appraisers. Each appraisal of the Mortgage
        Loan
        was made in accordance with the relevant provisions of the Financial
        Institutions Reform, Recovery, and Enforcement Act of 1989;

       

      (xxviii)  If
        the
        related Mortgage constitutes a deed of trust, then a trustee, duly qualified
        under applicable law to serve as such, has been properly designated and
        currently so serves and is named in such Mortgage, and no fees or expenses
        are
        or will become payable by the Purchaser to the trustee under such deed of
        trust,
        except in connection with a trustee’s sale after default by the related
        Mortgagor;

       

      (xxix)  Except
        with respect to Additional Collateral Mortgage Loans, if such Mortgage Loan
        had
        a Loan-to-Value Ratio of more than 80% at origination, such Mortgage Loan
        is and
        will be subject to a Primary Insurance Policy issued by a Qualified Insurer,
        which insures the applicable Seller or Master Servicer, its successors and
        assigns and insureds in the amount set forth on the Mortgage Loan Schedule
        provided that, a Primary Insurance Policy will not be required for any
        Cooperative Loan if (i) the proceeds of such Cooperative Loan were used to
        purchase a Cooperative Unit at the “insider’s price” when the building was
        converted to a Cooperative, (ii) the value of the Cooperative Unit for purposes
        of establishing the Loan-to-Value Ratio at origination was such “insider’s
        price”, (iii) the principal amount of the Cooperative Loan at origination was
        not more than 100% of such “insider’s price” and (iv) the Loan-to-Value Ratio at
        origination, as calculated using the Value at origination, was less than or
        equal to 80%. All provisions of such Primary Insurance Policy have been and
        are
        being complied with, such policy is in full force and effect, and all premiums
        due thereunder have been paid. Any related Mortgage subject to any such Primary
        Insurance Policy (other than a “lender-paid” Primary Insurance Policy) obligates
        the Mortgagor thereunder to maintain such insurance for the time period required
        by law and to pay all premiums and charges in connection therewith. As of
        the
        date of origination, the Loan-to-Value Ratio of such Mortgage Loan is as
        specified in the applicable Mortgage Loan Schedule;

       

      (xxx)  As
        of the
        date of origination of such Mortgage Loan, to the best of the applicable
        Seller’s knowledge, the related Mortgaged Property (or with respect to a
        Cooperative Loan, the related Cooperative Unit) is lawfully occupied under
        applicable law and all inspections, licenses and certificates required to
        be
        made or issued with respect to all occupied portions of the Mortgaged Property
        (or with respect to a Cooperative Loan, the related Cooperative Unit) and,
        with
        respect to the use and occupancy of the same, including but not limited to
        certificates of occupancy, have been made or obtained from the appropriate
        authorities;

       

      (xxxi)  Each
        Mortgage Loan either was (a) closed in the name of PHH Mortgage or in the
        name
        of another entity that is either a savings and loan association, a savings
        bank,
        a commercial bank, credit union, insurance company or an institution which
        is
        supervised and examined by a federal or state authority, or a mortgagee approved
        by the Secretary of Housing and Urban Development pursuant to Sections 203
        and
        211 of the National Housing Act (any such entity and PHH Mortgage, a “HUD
        Approved Mortgagee”), and was so at the time such Mortgage Loan was originated
        (PHH Mortgage or such other entity, the “Originator”) or (b) closed in the name
        of a correspondent lender under the circumstances described in the following
        sentence. If such Mortgage Loan was originated through a correspondent lender,
        such Mortgage Loan met the Originator’s underwriting criteria at the time of
        origination and was originated in accordance with the Originator’s policies and
        procedures and the Originator acquired such Mortgage Loan from the correspondent
        lender contemporaneously with the origination thereof. The Mortgage Loans
        that
        BGRMT is selling to Purchaser were originated by or on behalf of PHH Mortgage
        and subsequently assigned to BGRMT;

       

      (xxxii)  All
        of
        the terms of the related Mortgage Note pertaining to interest rate adjustments,
        payment adjustments and adjustments of the outstanding principal balance,
        if
        any, are enforceable and such adjustments will not affect the priority of
        the
        lien of the related Mortgage; all such adjustments on such Mortgage Loan
        have
        been made properly and in accordance with the provisions of such Mortgage
        Loan;

       

      (xxxiii)  To
        the
        best of the applicable Seller’s knowledge, the related Mortgagor is not the
        subject of any insolvency proceeding;

       

      (xxxiv)  Unless
        otherwise disclosed in the Prospectus Supplement or the Mortgage Loan Schedule,
        no Mortgage Loan contains provisions pursuant to which Monthly Payments are
        (a)
        paid or partially paid with funds deposited in any separate account established
        by the applicable Seller, the Mortgagor, or anyone on behalf of the Mortgagor,
        (b) paid by any source other than the Mortgagor or (c) contains any other
        similar provisions which may constitute a “buydown” provision. The Mortgage Loan
        is not a graduated payment mortgage loan and the Mortgage Loan does not have
        a
        shared appreciation or other contingent interest feature;

       

      (xxxv)  The
        Assignment is in recordable form and is acceptable for recording under the
        laws
        of the jurisdiction in which the Mortgaged Property is located;

       

      (xxxvi)  Any
        principal advances made to the Mortgagor prior to the Cut-off Date have been
        consolidated with the outstanding principal amount secured by the Mortgage,
        and
        the secured principal amount, as consolidated, bears a single interest rate
        and
        single repayment term. The consolidated principal amount does not exceed
        the
        original principal amount of the Mortgage Loan;

       

      (xxxvii)  Unless
        otherwise disclosed in the Prospectus Supplement or the Mortgage Loan Schedule,
        no Mortgage Loan has a balloon payment feature. With respect to any Mortgage
        Loan with a balloon payment feature, the Mortgage Note is payable in Monthly
        Payments based on a thirty year amortization schedule and has a final Monthly
        Payment substantially greater than the preceeding Monthly Payment which is
        sufficient to amortize the remaining principal balance of the Mortgage
        Loan;

       

      (xxxviii)  If
        the
        residential dwelling on the Mortgaged Property is a condominium unit or a
        unit
        in a planned unit development (other than a de minimis planned unit development)
        such condominium or planned unit development project meets the eligibility
        requirements of the Underwriting Guide;

       

      (xxxix)  No
        Mortgage Loan is subject to the provisions of the Homeownership and Equity
        Protection Act of 1994;

       

      (xl)  Unless
        otherwise disclosed in the Prospectus Supplement or the Mortgage Loan Schedule,
        no Mortgage Loan was made in connection with (a) the construction or
        rehabilitation of a Mortgaged Property or (b) facilitating the trade-in or
        exchange of a Mortgaged Property;

       

      (xli)  The
        applicable Seller has no knowledge of any circumstances or condition with
        respect to the Mortgage, the Mortgaged Property (or with respect to a
        Cooperative Loan, the acceptance of assignment and assumption of lease
        agreement, the Cooperative Unit or the cooperative project), the Mortgagor
        or
        the Mortgagor’s credit standing that can reasonably be expected to cause the
        Mortgage Loan to be an unacceptable investment, cause the Mortgage Loan to
        become delinquent, or adversely affect the value of the Mortgage
        Loan;

       

      (xlii)  Unless
        otherwise disclosed in the Prospectus Supplement or the Mortgage Loan Schedule,
        interest on each Mortgage Loan is calculated on the basis of a 360-day year
        consisting of twelve 30-day months;

       

      (xliii)  To
        the
        best of applicable Seller’s knowledge, the Mortgaged Property is in material
        compliance with all applicable environmental laws pertaining to environmental
        hazards including, without limitation, asbestos, and neither the applicable
        Seller nor, to the applicable Seller’s knowledge, the related Mortgagor, has
        received any notice of any violation or potential violation of such
        law;

       

      (xliv)  No
        Mortgage Loan is subject to negative amortization;

       

      (xlv)  No
        Mortgage Loan is a “High-Cost Home Loan” as defined in the New Jersey Home
        Ownership Act effective November 27, 2003;

       

      (xlvi)  Each
        Mortgage Loan, at the time it was made, complied in all material respects
        with
        applicable local, state and federal laws, including, but not limited to,
        all
        applicable predatory and abusive lending laws;

       

      (xlvii)  Each
        Mortgage Loan is a “qualified mortgage” as defined under Section 860G(a)(3) of
        the Code and Treasury Regulation Section 1.860G-2(a)(1);

       

      (xlviii)  None
        of
        the Mortgage Loans are “high cost loans” as defined by the applicable predatory-
        and abusive- lending laws;

       

      (xlix)  With
        respect to each Cooperative Loan, a cooperative lien search has been made
        by a
        company competent to make the same which company is acceptable to FNMA and
        qualified to do business in the jurisdiction where the Cooperative Unit is
        located;

       

      (l)  With
        respect to each Cooperative Loan, (i) the terms of the related proprietary
        lease
        is longer than the terms of the Cooperative Loan, (ii) there is no provision
        in
        any proprietary lease which requires the Mortgagor to offer for sale the
        Cooperative Assets owned by such Mortgagor first to the Cooperative, (iii)
        there
        is no prohibition in any proprietary lease against pledging the Cooperative
        Assets or assigning the proprietary lease and (iv) the recognition agreement
        is
        on a form of agreement published by the Aztech Document Systems, Inc. or
        includes provisions which are no less favorable to the lender than those
        contained in such agreement;

       

      (li)  With
        respect to each Cooperative Loan, each original UCC financing statement,
        continuation statement or other governmental filing or recordation necessary
        to
        create or preserve the perfection and priority of the first priority lien
        and
        security interest in the Cooperative Assets and proprietary lease has been
        timely and properly made. Any security agreement, chattel mortgage or equivalent
        document related to the Cooperative Loan and delivered to the Mortgagor or
        its
        designee establishes in the Mortgagor a valid and subsisting perfected first
        lien on and security interest in the Mortgaged Property described therein,
        and
        the Mortgagor has full right to sell and assign the same; and

       

      (lii)  With
        respect to each Cooperative Loan, each acceptance of assignment and assumption
        of lease agreement contains enforceable provisions such as to render the
        rights
        and remedies of the holder thereof adequate for the realization of the benefits
        of the security provided thereby. The acceptance of assignment and assumption
        of
        lease agreement contains an enforceable provision for the acceleration of
        the
        payment of the unpaid principal balance of the Mortgage Note in the event
        the
        Cooperative Unit is transferred or sold without the consent of the holder
        thereof.

       

      It
        is
        understood and agreed that the representations and warranties set forth in
        this
        Section 3.1 will inure to the benefit of the Purchaser, its successors and
        assigns, notwithstanding any restrictive or qualified endorsement on any
        Mortgage Note or assignment of Mortgage or the examination of any Mortgage
        File.

       

      B.  Remedies
        for Breach.

       

      1.  With
        respect to the representations and warranties contained herein that are made
        to
        the knowledge or the best knowledge of the related Seller or as to which
        the
        related Seller has no knowledge, if it is discovered that the substance of
        any
        such representation and warranty is inaccurate and the inaccuracy materially
        and
        adversely affects the value of the related Mortgage Loan, or the interest
        therein of the Purchaser or the Certificateholders, then notwithstanding
        the
        related Seller’s lack of knowledge with respect to the substance of such
        representation and warranty being inaccurate at the time the representation
        and
        warranty was made, such inaccuracy shall be deemed a breach of the applicable
        representation and warranty and the related Seller shall take such action
        described in the following paragraph of this Section 3.2(a) in respect of
        such
        Mortgage Loan.

       

      Upon
        discovery or receipt of notice of any materially defective document in, or
        that
        a document is missing from, a Mortgage File or of the breach by either Seller
        of
        any representation, warranty or covenant in Section 3.1(b) hereof in respect
        of
        any Mortgage Loan which materially adversely affects the value of such Mortgage
        Loan or the interest therein of the Purchaser or the Certificateholders,
        the
        applicable Seller shall deliver such missing document or cure such defect
        or
        breach within 90 days from the date such Seller was notified of such missing
        document, defect or breach, and if such Seller does not deliver such missing
        document or cure such defect or breach in all material respects during such
        period, the applicable Seller shall repurchase such Mortgage Loan from the
        Trust
        Fund at the Purchase Price within 90 days after the date on which such Seller
        was notified (subject to Section 3.2(c)) of such missing document, defect
        or
        breach. If such defect or breach can ultimately be cured but is not reasonably
        expected to be cured within the 90-day period, then the applicable Seller
        shall
        have such additional time, if any, as is reasonable, to cure such defect
        or
        breach, provided that the applicable Seller has commenced curing or correcting
        such defect or breach and is diligently pursuing the same. In lieu of
        repurchasing any such Mortgage Loan as provided above, the applicable Seller
        may
        cause such Mortgage Loan to be removed from the Trust Fund (in which case
        it
        shall become a Defective Mortgage Loan) and substitute one or more Eligible
        Substitute Mortgage Loans in the manner and subject to the limitations set
        forth
        in Section 3.2(c). If the breach of representation and warranty that gave
        rise
        to the obligation to repurchase or substitute a Mortgage Loan pursuant to
        this
        Section 3.2 was the representation and warranty set forth in clause (xlvi)
        of
        Section 3.1, then PHH Mortgage shall pay to the Trust Fund, concurrently
        with
        and in addition to the remedies provided in the preceding three sentences,
        an
        amount equal to any liability, penalty or expense that was actually incurred
        and
        paid out of or on behalf of the Trust Fund, and that directly resulted from
        such
        breach, or if incurred and paid by the Trust Fund thereafter, concurrently
        with
        such payment. It is understood and agreed that the obligation of the applicable
        Seller to cure or to repurchase (or to substitute for) any Mortgage Loan
        as to
        which a document is missing, a material defect in a constituent document
        exists
        or as to which such a breach has occurred and is continuing shall constitute
        the
        sole remedy respecting such omission, defect or breach available to the
        Purchaser. Notwithstanding the foregoing, in recognition of the Trust’s rights
        against PHH Mortgage with respect to the Mortgage Loans acquired by it from
        PHH
        Mortgage and conveyed to the Purchaser hereunder, the Purchaser shall have
        the
        right to cause PHH Mortgage to repurchase directly any Defective Mortgage
        Loan
        (other than as a result of a breach by BGRMT of Section 3.1(b)(iii) or
        3.1(b)(xv) hereof, in which case the Purchaser shall have the right to cause
        BGRMT to repurchase directly the Defective Mortgage Loan) acquired hereunder
        by
        the Purchaser from BGRMT.

       

      2.  Any
        substitution of Eligible Substitute Mortgage Loans for Defective Mortgage
        Loans
        made pursuant to Section 3.2(a), must be effected prior to the date which
        is two
        years after the Closing Date and in accordance with Section 2.03 of the Pooling
        and Servicing Agreement.

       

      In
        addition, the applicable Seller shall obtain at its own expense and deliver
        to
        the Trustee an Opinion of Counsel to the effect that such substitution will
        not
        cause (a) any federal tax to be imposed on the Trust Fund, including without
        limitation, any federal tax imposed on “prohibited transactions” under Section
        860F(a)(1) of the Code or on “contributions after the startup date” under
        Section 860G(d)(1) of the Code, or (b) any REMIC to fail to qualify as a
        REMIC
        at any time that any Certificate is outstanding.

       

      3.  Upon
        discovery by the Purchaser, a Seller, the Master Servicer or the Trustee
        that
        any Mortgage Loan does not constitute a “qualified mortgage” within the meaning
        of Section 860G(a)(3) of the Code, the party discovering such fact shall
        within
        two Business Days give written notice thereof to the other parties. In
        connection therewith, the applicable Seller shall repurchase such Mortgage
        Loan
        from the Trust Fund at the Purchase Price or, subject to the limitations
        set
        forth in Section 2.03 of the Pooling and Servicing Agreement, substitute
        one or
        more Eligible Substitute Mortgage Loans for the affected Mortgage Loan within
        60
        days of the earlier of discovery or receipt of such notice with respect to
        such
        affected Mortgage Loan. Such repurchase or substitution shall be made by
        the
        applicable Seller if the affected Mortgage Loan’s status as a non-qualified
        mortgage is or results from a breach of any representation, warranty or covenant
        made by the applicable Seller. Any such repurchase or substitution shall
        be made
        in the same manner as set forth in Section 3.2(a).

       

      C.  Purchaser
        Representations and Warranties.
        The
        Purchaser hereby represents and warrants to the Sellers as of the Closing
        Date
        (or if otherwise specified below, as of the date so specified)
        that:

       

      1.  the
        Purchaser is a limited liability company duly organized, validly existing
        and in
        good standing under the laws of the State of Delaware;

       

      2.  the
        Purchaser has full corporate power to own its property, to carry on its business
        as presently conducted and to enter into and perform its obligations under
        this
        Agreement;

       

      3.  the
        execution and delivery by the Purchaser of this Agreement have been duly
        authorized by all necessary corporate action on the part of the Purchaser;
        and
        neither the execution and delivery of this Agreement, nor the consummation
        of
        the transactions herein contemplated hereby, nor compliance with the provisions
        hereof, will conflict with or result in a breach of, or constitute a default
        under, any of the provisions of any law, governmental rule, regulation,
        judgment, decree or order binding on the Purchaser or its properties or the
        certificate of formation or limited liability company agreement of the
        Purchaser, except those conflicts, breaches or defaults which would not
        reasonably be expected to have a material adverse effect on the Purchaser’s
        ability to enter into this Agreement and to consummate the transactions
        contemplated hereby;

       

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

       

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

       

      6.  except
        as
        previously disclosed in the Prospectus Supplement, there are no actions,
        suits
        or proceedings pending or, to the knowledge of the Purchaser, threatened
        against
        the Purchaser, before or by any court, administrative agency, arbitrator
        or
        governmental body (i) with respect to any of the transactions contemplated
        by
        this Agreement or (ii) with respect to any other matter which in the judgment
        of
        the Purchaser if determined adversely to the Purchaser would reasonably be
        expected to materially and adversely affect the Purchaser’s ability to perform
        its obligations under this Agreement; and the Purchaser is not in default
        with
        respect to any order of any court, administrative agency, arbitrator or
        governmental body so as to materially and adversely affect the transactions
        contemplated by this Agreement;

       

       

      IV.

       

      SELLER’S
        COVENANTS

       

      A.  Covenants
        of the Sellers.
        Each
        Seller hereby covenants that, except for the transfer hereunder with respect
        to
        the Mortgage Loans, each Seller will not sell, pledge, assign or transfer
        to any
        other Person, or grant, create, incur or assume any Lien on, any Mortgage
        Loan,
        whether now existing or hereafter created, or any interest therein; each
        Seller
        will notify the Trustee, on behalf of the Trust Fund, of the existence of
        any
        Lien (other than as provided above) on any Mortgage Loan immediately upon
        discovery thereof; and each Seller will defend the right, title and interest
        of
        the Trustee, on behalf of the Trust Fund, in, to and under the Mortgage Loans,
        whether now existing or hereafter created, against all claims of third parties
        claiming through or under the respective Seller.

       

       

      V.

       

      INDEMNIFICATION
        BY PHH MORTGAGE

      WITH
        RESPECT TO THE MORTGAGE LOANS

       

      A.  Indemnification
        With Respect to the Mortgage Loans.
        PHH
        Mortgage shall indemnify and hold harmless the Purchaser from and against
        any
        loss, liability or expense arising from the breach by either Seller of its
        representations and warranties in Section 3.1 of this Agreement (other than
        as a
        result of a breach by BGRMT of Section 3.1(b)(iii) or 3.1(b)(xv) hereof,
        in
        which case BGRMT shall indemnify and hold harmless the Purchaser from and
        against any loss, liability or expense arising from such breach) which
        materially and adversely affects the Purchaser’s interest in any Mortgage Loan
        or from the failure by either Seller to perform its obligations under this
        Agreement in any material respect, provided that neither PHH Mortgage nor
        BGRMT
        shall have any obligation to indemnify the Purchaser in respect of any loss,
        liability or expense that arises as a result of the Purchaser’s willful
        malfeasance, bad faith or gross negligence or as a result of the breach by
        the
        Purchaser of its obligations hereunder.

       

      B.  Limitation
        on Liability of the Sellers.
        None of
        the directors, officers, employees or agents of either Seller shall be under
        any
        liability to the Purchaser, it being expressly understood that all such
        liability is expressly waived and released as a condition of, and as
        consideration for, the execution of this Agreement. Except as and to the
        extent
        expressly provided in the Pooling and Servicing Agreement or this Agreement,
        the
        Sellers shall not be under any liability to the Trust Fund, the Trustee or
        the
        Certificateholders. The Sellers and any director, officer, employee or agent
        of
        each Seller may rely in good faith on any document of any kind prima
        facie
        properly
        executed and submitted by any Person respecting any matters arising
        hereunder.

       

       

      VI.

      TERMINATION

       

      A.  Termination.
        The
        respective obligations and responsibilities of each Seller and the Purchaser
        created hereby shall terminate, except for each Seller’s indemnity obligations
        as provided herein, upon the termination of the Trust Fund pursuant to the
        terms
        of the Pooling and Servicing Agreement.

       

       

      VII.

      MISCELLANEOUS
        PROVISIONS

       

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

       

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

       

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

       

      (i)  if
        to the
        PHH Mortgage:

       

      PHH
        Mortgage Corporation

      3000
        Leadenhall Road

      Mail
        Stop
        LGL

      Mt.
        Laurel, NJ 08054

      Attention:
        General Counsel

       

      or,
        such
        other address as may hereafter be furnished to the Purchaser and BGRMT in
        writing by PHH Mortgage.

       

      (ii)  if
        to
        BGRMT:

       

      c/o
        PHH
        Mortgage Corporation, as Administrator

      3000
        Leadenhall Road

      Mail
        Stop
        LGL

      Mt.
        Laurel, NJ 08054

      Attention:
        General Counsel

       

      or,
        such
        other address as may hereafter be furnished to the Purchaser and PHH Mortgage
        in
        writing by Trust.

       

      (iii)  if
        to the
        Purchaser:

       

      PHH
        Mortgage Capital LLC

      3000
        Leadenhall Road

      Mail
        Stop
        LGL

      Mt.
        Laurel, New Jersey 08054

      Attention:
        General Counsel

       

      or
        such
        other address as
        may
        hereafter be furnished to the Sellers in writing by the Purchaser.

       

      D.  Severability
        of Provisions.
        If any
        one or more of the covenants, agreements, provisions or terms of this Agreement
        shall be held invalid for any reason whatsoever. then such covenants,
        agreements, provisions or terms shall be deemed severable from the remaining
        covenants, agreements, provisions or terms of this Agreement and shall in
        no way
        affect the validity or enforceability of the other provisions of this
        Agreement.

       

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

       

      F.  Counterparts.
        This
        Agreement may be executed in two 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 and such counterparts together shall constitute
        one
        and the same Agreement.

       

      G.  Further
        Agreements.
        The
        Purchaser and the Sellers each agree to execute and deliver to the other
        such
        additional documents, instruments or agreements as may be necessary or
        appropriate to effectuate the purposes of this Agreement. The Purchaser and
        each
        Seller agrees to use its best reasonable efforts to take all actions necessary
        to be taken by it to cause the Certificates to be issued and rated in the
        highest rating category by each of the Rating Agencies, with the Certificates
        to
        be offered pursuant to the Purchaser’s shelf registration statement, and each
        party will cooperate with the other in connection therewith.

       

      H.  Intention
        of the Parties.
        It is
        the intention of the parties that the Purchaser is purchasing, and the Sellers
        are selling, the Mortgage Loans, rather than a loan by the Purchaser to the
        Sellers secured by the Mortgage Loans. Accordingly, the parties hereto each
        intend to treat this transaction with respect to the Mortgage Loans for federal
        income tax purposes as a sale by the Sellers, and a purchase by the Purchaser,
        of the Mortgage Loans. The Purchaser will have the right to review the Mortgage
        Loans and the related documents to determine the characteristics of the Mortgage
        Loans which will affect the federal income tax consequences of owning the
        Mortgage Loans and the Sellers will cooperate with all reasonable requests
        made
        by the Purchaser in the course of such review.

       

      I.  Successors
        and Assigns; Assignment of Purchase Agreement.
        This
        Agreement shall bind and inure to the benefit of and be enforceable by the
        Sellers, the Purchaser and their respective successors and assigns. The
        obligations of the Sellers under this Agreement cannot be assigned or delegated
        to a third party without the consent of the Purchaser, which consent shall
        be at
        the Purchaser’s sole discretion. The parties hereto acknowledge that the
        Purchaser is acquiring the Mortgage Loans for the purpose of assigning the
        Mortgage Loans to the Trustee, on behalf of the Trust Fund, for the benefit
        of
        the Certificateholders. As an inducement to the Purchaser to purchase the
        Mortgage Loans, each Seller acknowledges and consents to the assignment by
        the
        Purchaser to the Trustee, on behalf of the Trust Fund of all of the Purchaser’s
        rights against the Sellers pursuant to this Agreement and to the enforcement
        or
        exercise of any right or remedy against the Sellers pursuant to this Agreement
        by the Purchaser. Such enforcement of a right or remedy by the Trustee, on
        behalf of the Trust Fund, shall have the same force and effect as if the
        right
        or remedy had been enforced or exercised by the Purchaser directly.

       

      J.  Survival.
        The
        representations and warranties made herein by each Seller and the provisions
        of
        Article V hereof shall survive the purchase of the Mortgage Loans
        hereunder.

       

       

      IN
        WITNESS WHEREOF, the Seller and the Purchaser have caused their names to
        be
        signed to this Mortgage Loan Purchase Agreement by their respective officers
        thereunto duly authorized as of the day and year first above
        written.

      
        	 	 	 
	 	
                PHH
                  MORTGAGE CAPITAL LLC

                
                  as
                    Purchaser

                

              
	 
 	 
 	 
 
	 	 	By: 
	 	
                
                  

                

              
	 	
                Name:

                
                  Title:

                

              

      

       

      
        	 	 	 
	 	
                PHH
                  MORTGAGE CORPORATION

                
                  as
                    Seller

                

              
	 
 	 
 	 
 
	 	  	By: 
	 	
                
                  

                

              
	 	 Name:
                
                  Title:

                

              

      

      
         

        
          	 	 	 
	 	
                  
                    BISHOP’S
                      GATE RESIDENTIAL 

                    MORTGAGE
                      TRUST

                  

                  
                    
                      as
                        Seller

                       

                      
                        By: 
PHH
                          MORTGAGE CORPORATION, 

                        as
                          Administrator

                      

                    

                  

                
	 
 	 
 	 
 
	 	  	
                  By: 
                    

                
	 	
                  
                    

                  

                
	 	 Name:
                  
                    Title:

                  

                

        

         

      

       

      Exhibit
        1

       

      MORTGAGE
        LOAN SCHEDULE

      
 

      EXHIBIT
        K

       

      ASSIGNMENT,
        ASSUMPTION AND RECOGNITION AGREEMENT

      (ADDITIONAL
        COLLATERAL SERVICING AGREEMENT)

       

      (Available
        Upon Request)

       

       

      EXHIBIT
        L

       

      [RESERVED]

       

      
 

      EXHIBIT
        M

       

      FORM
        OF
        FORM 10-K CERTIFICATE

       

      I,
        [identify the certifying individual], certify that:

       

      1.  I
        have
        reviewed this report on Form 10-K and all reports on Form 10-D required to
        be
        filed in respect of the period covered by this report on Form 10-K of the
        trust
        (the “Trust”) created pursuant to the Pooling and Servicing Agreement dated
        September 1, 2006 (the “Agreement”) among PHH Mortgage Capital LLC (the
“Depositor”), PHH Mortgage Corporation (the “Master Servicer”) and Citbank, N.A.
        (the “Trustee”) (the “Exchange Act periodic reports”);

       

      2.  Based
        on
        my knowledge, the Exchange Act periodic reports, taken as a whole, do not
        contain any untrue statement of a material fact or omit to state a material
        fact
        necessary to make the statements made, in light of the circumstances under
        which
        such statements were made, not misleading with respect to the period covered
        by
        this report;

       

      3.  Based
        on
        my knowledge, all of the distribution, servicing and other information required
        to be provided under Form 10-D for the period covered by this report is included
        in the Exchange Act periodic reports;

       

      4.  I
        am
        responsible for reviewing the activities performed by the Master Servicer
        and
        based on my knowledge and the compliance review conducted in preparing the
        servicer compliance statement required in this report under Item 1123 of
        Regulation AB, and except as disclosed in the Exchange Act periodic reports,
        the
        Master Servicer has fulfilled its obligations under the Agreement in all
        material respects; and

       

      5.  All
        of
        the reports on assessment of compliance with servicing criteria for asset-backed
        securities and their related attestation reports on assessment of compliance
        with servicing criteria for asset-backed securities required to be included
        in
        this report in accordance with Item 1122 of Regulation AB and Exchange Act
        Rules
        13a-18 and 15d-18 have been included as an exhibit to this report, except
        as
        otherwise disclosed in this report. Any material instances of noncompliance
        described in such reports have been disclosed in this report on Form
        10-K.

       

      In
        giving
        the certifications above, I have reasonably relied on the information provided
        to me by the following unaffiliated parties: the Trustee.

       

      Date:____________

       

      _________________________________*

       

      [Signature]

      Name:

      Title:

       

      *
        - to be
        signed by the Chief Executive Officer of the Master Servicer

       

      

      EXHIBIT
        N

       

      FORM
        OF
        BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE

       

      PHH
        Mortgage Corporation

      3000
        Leadenhall Road

      Mt.
        Laurel, New Jersey 08054

       

      
        	 	
                Re:

              	
                PHHMC
                  Mortgage Pass-Through Certificates, Series
                  2006-3

              

      

      

       

      Reference
        is made to the Pooling and Servicing Agreement, dated as of September 1,
        2006
        (the “Pooling and Servicing Agreement”), by and among Citibank, N.A., as trustee
        (the “Trustee”), PHH Mortgage Corporation, as master servicer (the “Master
        Servicer”) and PHH Mortgage Capital LLC, as depositor (the “Depositor”). The
        Trustee, hereby certifies to the Master Servicer, and its officers, directors
        and affiliates, and with the knowledge and intent that they will rely upon
        this
        certification, that:

       

      
        	 	
                (i)

              	
                The
                  Trustee has reviewed the annual report on Form 10-K for the fiscal
                  year
                  _____, and all reports on Form 10-D containing distribution reports
                  filed
                  in respect of periods included in the year covered by that annual
                  report,
                  relating to the above-referenced
                  trust;

              

      

       

      
        	 	
                (ii)

              	
                Based
                  on my knowledge, the information set forth in the reports on Form
                  10-K and
                  Form 10-D referenced in (i) above (including the distribution reports)
                  does not contain any untrue statement of material fact subject
                  to the
                  accuracy of the information provided to us by the Master Servicer
                  and
                  includes all information required to be stated therein;
                  and

              

      

       

      
        	 	
                (iii)

              	
                Based
                  on my knowledge, all distribution information required to be provided
                  by
                  the Trustee under the Pooling and Servicing Agreement is included
                  in these
                  reports.

              

      

       

      Date:

      
        	 	 	 
	 	
                [______________],
                  as Trustee

              
	 
 	 
 	 
 
	 	 	
                By:     
                  ________________________________

              
	 	
                Name:
                  ________________________________

              
	 	
                Title:  
                  ________________________________

              

      

       

       

       

      EXHIBIT
        O

       

      SERVICING
        CRITERIA TO BE ADDRESSED

      IN
        ASSESSMENT OF COMPLIANCE

      Key:

      X
        -
        obligation

      [X]
        - under
        consideration for obligation

      

      Where
        there are multiple checks for criteria the attesting party will identify
        in
        their management assertion that they are attesting only to the portion of
        the
        distribution chain they are responsible for in the related transaction
        agreements.

      

      

      
        	
                Reg
                  AB Reference

              	
                Servicing
                  Criteria

              	
                Primary
                  Servicer

              	
                Master
                  Servicer

              	
                Trustee

              
	 
	
                1122(d)(1)(i)

              	
                Policies
                  and procedures are instituted to monitor any performance or other
                  triggers
                  and events of default in accordance with the transaction
                  agreements.

              	
                X

              	
                X

              	 
	
                1122(d)(1)(ii)

              	
                If
                  any material servicing activities are outsourced to third parties,
                  policies and procedures are instituted to monitor the third party’s
                  performance and compliance with such servicing activities.

              	
                X

              	
                X

              	
                X

              
	
                1122(d)(1)(iii)

              	
                Any
                  requirements in the transaction agreements to maintain a back-up
                  servicer
                  for the Pool Assets are maintained. 

              	 	 	 
	
                1122(d)(1)(iv)

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

              	
                X

              	
                X

              	 
	
                 Cash
                  Collection and 

                Administration

              
	
                1122(d)(2)(i)

              	
                Payments
                  on pool assets are deposited into the appropriate custodial bank
                  accounts
                  and related bank clearing accounts no more than two business days
                  following receipt, or such other number of days specified in the
                  transaction agreements. 

              	
                X

              	
                X

              	
                X

              
	
                1122(d)(2)(ii)

              	
                Disbursements
                  made via wire transfer on behalf of an obligor or to an investor
                  are made
                  only by authorized personnel. 

              	
                X

              	
                X

              	
                X

              
	
                1122(d)(2)(iii)

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

              	
                X

              	
                X

              	 
	
                1122(d)(2)(iv)

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

              	 	 	
                X

              
	
                1122(d)(2)(v)

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

              	
                X

              	
                X

              	 
	
                1122(d)(2)(vi)

              	
                Unissued
                  checks are safeguarded so as to prevent unauthorized access.
                  

              	
                X

              	
                X

              	 
	
                1122(d)(2)(vii)
                  

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

              	
                X

              	
                X

              	
                X

              
	
                 Investor
                  Remittances and 

                 Reporting

              
	
                1122(d)(3)(i)

              	
                Reports
                  to investors, including those to be filed with the Commission,
                  are
                  maintained in accordance with the transaction agreements and applicable
                  Commission requirements. Specifically, such reports (A) are prepared
                  in
                  accordance with timeframes and other terms set forth in the transaction
                  agreements; (B) provide information calculated in accordance with
                  the
                  terms specified in the transaction agreements; (C) are filed with
                  the
                  Commission as required by its rules and regulations; and (D) agree
                  with
                  investors’ or the trustee’s records as to the total unpaid principal
                  balance and number of Pool Assets serviced by the Servicer.
                  

              	
                X

              	
                X

              	
                X

              
	
                1122(d)(3)(ii)

              	
                Amounts
                  due to investors are allocated and remitted in accordance with
                  timeframes,
                  distribution priority and other terms set forth in the transaction
                  agreements. 

              	
                X

              	
                X

              	
                X

              
	
                1122(d)(3)(iii)

              	
                Disbursements
                  made to an investor are posted within two business days to the
                  Servicer’s
                  investor records, or such other number of days specified in the
                  transaction agreements. 

              	
                X

              	
                X

              	
                X

              
	
                1122(d)(3)(iv)

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

              	
                X

              	
                X

              	
                X

              
	
                 Pool
                  Asset Administration

              
	
                1122(d)(4)(i)
                  

              	
                Collateral
                  or security on pool assets is maintained as required by the transaction
                  agreements or related pool asset documents. 

              	
                X

              	
                X

              	
                X*

              
	
                1122(d)(4)(ii)

              	
                Pool
                  assets and related documents are safeguarded as required by the
                  transaction agreements 

              	
                X

              	
                X

              	
                X*

              
	
                1122(d)(4)(iii)

              	
                Any
                  additions, removals or substitutions to the asset pool are made,
                  reviewed
                  and approved in accordance with any conditions or requirements
                  in the
                  transaction agreements. 

              	
                X

              	
                X

              	 
	
                1122(d)(4)(iv)

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

              	
                X

              	
                X

              	 
	
                1122(d)(4)(v)

              	
                The
                  Servicer’s records regarding the pool assets agree with the Servicer’s
                  records with respect to an obligor’s unpaid principal balance.
                  

              	
                X

              	
                X

              	 

      

      
        	
                * The
                  Trustee or its subcontractor shall provide assessment regarding
                  these
                  criteria.

              

      

      

      
        	
                1122(d)(4)(vi)

              	
                Changes
                  with respect to the terms or status of an obligor's pool assets
                  (e.g.,
                  loan modifications or re-agings) are made, reviewed and approved
                  by
                  authorized personnel in accordance with the transaction agreements
                  and
                  related pool asset documents. 

              	
                X

              	
                X

              	 
	
                1122(d)(4)(vii)

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

              	
                X

              	
                X

              	 
	
                1122(d)(4)(viii)

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

              	
                X

              	
                X

              	 
	
                1122(d)(4)(ix)

              	
                Adjustments
                  to interest rates or rates of return for pool assets with variable
                  rates
                  are computed based on the related pool asset documents. 

              	
                X

              	
                X

              	 
	
                1122(d)(4)(x)

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

              	
                X

              	
                X

              	 
	
                1122(d)(4)(xi)

              	
                Payments
                  made on behalf of an obligor (such as tax or insurance payments)
                  are made
                  on or before the related penalty or expiration dates, as indicated
                  on the
                  appropriate bills or notices for such payments, provided that such
                  support
                  has been received by the servicer at least 30 calendar days prior
                  to these
                  dates, or such other number of days specified in the transaction
                  agreements. 

              	
                X

              	
                X

              	 
	
                1122(d)(4)(xii)

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

              	
                X

              	
                X

              	 
	
                1122(d)(4)(xiii)

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

              	
                X

              	
                X

              	 
	
                1122(d)(4)(xiv)
                  

              	
                Delinquencies,
                  charge-offs and uncollectible accounts are recognized and recorded
                  in
                  accordance with the transaction agreements. 

              	 	
                X

              	 
	
                1122(d)(4)(xv)

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

              	 	 	 

      

      

       

      EXHIBIT
        P

      

      FORM
        10-D, FORM 8-K AND FORM 10-K REPORTING RESPONSIBILITY

       

      As
        to
        each item described below, the entity indicated as the Responsible Party
        shall
        be primarily responsible for reporting the information to the Trustee pursuant
        to Section 8.17(a)(i), (ii) and (iii). If the Trustee is indicated below
        as to
        any item, then the Trustee is primarily responsible for obtaining that
        information. 

      

      Under
        Item 1 of Form 10-D: a) items marked “4.02 statement” are required to be
        included in the monthly statement under Section 4.02, provided by the Trustee
        based on information received from the Master Servicer to the extent required
        of
        the Master Servicer under the Pooling and Servicing Agreement; and b) items
        marked “Form 10-D report” are required to be in the Form 10-D report but not the
        4.02 statement, provided by the party indicated. Information under all other
        Items of Form 10-D is to be included in the Form 10-D report. Items indicated
        as
“N/A” are not applicable to the transaction.

      

      For
        purposes of this Exhibit, “Servicer” includes the Special Servicer.

      

      
        	
                Form

              	
                Item

              	
                Description

              	
                Responsible
                  Party

              
	
                10-D

              	 	 	 
	
                1

              	
                Distribution
                  and Pool Performance Information

              	 
	
                Item
                  1121(a) - Distribution and Pool Performance
                  Information

              	 
	
                (1)
                  Any applicable record dates, accrual dates, determination dates
                  for
                  calculating distributions and actual distribution dates for the
                  distribution period.

              	
                4.02
                  statement

              
	
                (2)
                  Cash flows received and the sources thereof for distributions,
                  fees and
                  expenses.

              	
                4.02
                  statement

              
	
                (3)
                  Calculated amounts and distribution of the flow of funds for the
                  period
                  itemized by type and priority of payment, including:

              	
                4.02
                  statement

              
	
                (i)
                  Fees or expenses accrued and paid, with an identification of the
                  general
                  purpose of such fees and the party receiving such fees or
                  expenses.

              	
                4.02
                  statement

              
	
                (ii)
                  Payments accrued or paid with respect to enhancement or other support
                  identified in Item 1114 of Regulation AB (such as insurance premiums
                  or
                  other enhancement maintenance fees), with an identification of
                  the general
                  purpose of such payments and the party receiving such
                  payments.

              	
                N/A

              
	
                (iii)
                  Principal, interest and other distributions accrued and paid on
                  the
                  asset-backed securities by type and by class or series and any
                  principal
                  or interest shortfalls or carryovers.

              	
                4.02
                  statement

              
	
                (iv)
                  The amount of excess cash flow or excess spread and the disposition
                  of
                  excess cash flow.

              	
                N/A

              
	
                (4)
                  Beginning and ending principal balances of the asset-backed
                  securities.

              	
                4.02
                  statement

              
	
                (5)
                  Interest rates applicable to the pool assets and the asset-backed
                  securities, as applicable. Consider providing interest rate information
                  for pool assets in appropriate distributional groups or incremental
                  ranges.

              	
                4.02
                  statement

              
	
                (6)
                  Beginning and ending balances of transaction accounts, such as
                  reserve
                  accounts, and material account activity during the period.

              	
                4.02
                  statement

              
	
                (7)
                  Any amounts drawn on any credit enhancement or other support identified
                  in
                  Item 1114 of Regulation AB, as applicable, and the amount of coverage
                  remaining under any such enhancement, if known and
                  applicable.

              	
                N/A

              
	
                (8)
                  Number and amount of pool assets at the beginning and ending of
                  each
                  period, and updated pool composition information, such as weighted
                  average
                  coupon, weighted average life, weighted average remaining term,
                  pool
                  factors and prepayment amounts.

              	
                4.02
                  statement

                 

                Updated
                  pool composition information fields to be as reasonably requested
                  by
                  Depositor in writing to the Master Servicer and the Trustee at
                  least 30
                  days prior to the related Remittance Date from time to
                  time

              
	
                (9)
                  Delinquency and loss information for the period. 

                 

                In
                  addition, describe any material changes to the information specified
                  in
                  Item 1100(b)(5) of Regulation AB regarding the pool
                  assets.

              	
                4.02
                  statement.

                 

                Form
                  10-D report: PHH Mortgage Corporation/Depositor

              
	
                (10)
                  Information on the amount, terms and general purpose of any advances
                  made
                  or reimbursed during the period, including the general use of funds
                  advanced and the general source of funds for
                  reimbursements.

              	
                4.02
                  statement

              
	
                (11)
                  Any material modifications, extensions or waivers to pool asset
                  terms,
                  fees, penalties or payments during the distribution period or that
                  have
                  cumulatively become material over time.

              	
                Form
                  10-D report: PHH Mortgage Corporation

              
	
                (12)
                  Material breaches of pool asset representations or warranties or
                  transaction covenants.

              	
                Form
                  10-D report: PHH Mortgage (subject to Depositor
                  approval)

              
	
                (13)
                  Information on ratio, coverage or other tests used for determining
                  any
                  early amortization, liquidation or other performance trigger and
                  whether
                  the trigger was met.

              	
                4.02
                  statement

              
	
                (14)
                  Information regarding any new issuance of asset-backed securities
                  backed
                  by the same asset pool, 

                 

                [information
                  regarding] any pool asset changes (other than in connection with
                  a pool
                  asset converting into cash in accordance with its terms), such
                  as
                  additions or removals in connection with a prefunding or revolving
                  period
                  and pool asset substitutions and repurchases (and purchase rates,
                  if
                  applicable), and cash flows available for future purchases, such
                  as the
                  balances of any prefunding or revolving accounts, if
                  applicable.

                 

                Disclose
                  any material changes in the solicitation, credit-granting, underwriting,
                  origination, acquisition or pool selection criteria or procedures,
                  as
                  applicable, used to originate, acquire or select the new pool
                  assets.

              	
                Form
                  10-D report: Depositor

                 

                 

                Form
                  10-D report: PHH Mortgage Corporation (subject to Depositor
                  approval)

                 

                 

                 

                 

                 

                Form
                  10-D report: PHH Mortgage Corporation (subject to Depositor
                  approval)

              
	
                Item
                  1121(b) - Pre-Funding or Revolving Period Information

                 

                Updated
                  pool information as required under Item 1121(b).

              	
                N/A

              
	
                2

              	
                Legal
                  Proceedings

              	 
	
                Item
                  1117 - Legal proceedings pending against the following entities,
                  or their
                  respective property, that is material to Certificateholders, including
                  proceedings known to be contemplated by governmental
                  authorities:

                 

                Sponsor
                  (Seller)

                 

                Depositor

                 

                Trustee

                 

                Issuing
                  entity

                 

                Servicer
                  or any Subservicer to which Servicer delegates servicing function
                  to that
                  is servicing 20% or more of pool assets at time of report

                 

                Originator
                  of 20% or more of pool assets as of the Cut-off Date

                 

                Custodian

              	
                 

                 

                 

                 

                Seller

                 

                Depositor

                 

                Trustee

                 

                Depositor

                 

                Master
                  Servicer

                 

                 

                Master
                  Servicer

                 

                Trustee

              
	
                3

              	
                Sales
                  of Securities and Use of Proceeds

              	 
	
                Information
                  from Item 2(a) of Part II of Form 10-Q:

                 

                With
                  respect to any sale of securities by the sponsor, depositor or
                  issuing
                  entity, that are backed by the same asset pool or are otherwise
                  issued by
                  the issuing entity, whether or not registered, provide the sales
                  and use
                  of proceeds information in Item 701 of Regulation S-K. Pricing
                  information
                  can be omitted if securities were not registered.

              	
                Depositor

              
	
                4

              	
                Defaults
                  Upon Senior Securities

              	 
	
                Information
                  from Item 3 of Part II of Form 10-Q:

                 

                Report
                  the occurrence of any Event of Default of which the Trustee has
                  received
                  written notice or has actual knowledge (after expiration of any
                  grace
                  period and provision of any required notice)

              	
                Trustee

              
	
                5

              	
                Submission
                  of Matters to a Vote of Security Holders

              	 
	
                Information
                  from Item 4 of Part II of Form 10-Q

              	
                Trustee

              
	
                6

              	
                Significant
                  Obligors of Pool Assets

              	 
	
                Item
                  1112(b) - Significant
                  Obligor Financial Information*

              	
                N/A

              
	
                *This
                  information need only be reported on the Form 10-D for the distribution
                  period in which updated information is required pursuant to the
                  Item.

              	 
	
                7

              	
                Significant
                  Enhancement Provider Information

              	 
	
                Item
                  1114(b)(2) - Credit Enhancement Provider Financial
                  Information*

                 

                Determining
                  applicable disclosure threshold

                 

                 

                Obtaining
                  required financial information or effecting incorporation by
                  reference

              	
                N/A

              
	
                Item
                  1115(b) - Derivative Counterparty Financial Information*

                 

                Determining
                  current maximum probable exposure

                 

                Determining
                  current significance percentage

                 

                 

                Obtaining
                  required financial information or effecting incorporation by
                  reference

              	
                 

                 

                 

                N/A

                 

                 

                N/A

                 

                 

                 

                N/A

              
	
                *This
                  information need only be reported on the Form 10-D for the distribution
                  period in which updated information is required pursuant to the
                  Items.

              	 
	
                8

              	
                Other
                  Information

              	 
	
                Disclose
                  any information required to be reported on Form 8-K during the
                  period
                  covered by the Form 10-D but not reported

              	
                The
                  Responsible Party for the applicable Form 8-K item as indicated
                  below

              
	
                9

              	
                Exhibits

              	 
	
                Distribution
                  report

              	
                Trustee

              
	
                Exhibits
                  required by Item 601 of Regulation S-K, such as material
                  agreements

              	
                Depositor

              
	
                8-K

              	 
	
                1.01

              	
                Entry
                  into a Material Definitive Agreement

              	 
	
                Disclosure
                  is required regarding entry into or amendment of any definitive
                  agreement
                  that is material to the securitization, even if depositor is not
                  a party.
                  

                 

                Examples:
                  servicing agreement, custodial agreement.

                 

                Note:
                  disclosure not required as to definitive agreements that are fully
                  disclosed in the prospectus

              	
                Any
                  of the following that is entering into a material definitive agreement:
                  Master Servicer, Trustee, Depositor

              
	
                1.02

              	
                Termination
                  of a Material Definitive Agreement

              	 
	
                Disclosure
                  is required regarding termination of any definitive agreement that
                  is
                  material to the securitization (other than expiration in accordance
                  with
                  its terms), even if depositor is not a party. 

                 

                Examples:
                  servicing agreement, custodial agreement.

              	
                Any
                  of the following that is requesting termination of a material definitive
                  agreement: Master Servicer, Trustee, Depositor

              
	
                1.03

              	
                Bankruptcy
                  or Receivership

              	 
	
                Disclosure
                  is required regarding the bankruptcy or receivership, if known
                  to the
                  Depositor, with respect to any of the following: 

                 

                Sponsor
                  (Seller), Depositor, Master Servicer, affiliated Servicer, other
                  Servicer
                  servicing 20% or more of pool assets at time of report, other material
                  servicers, Trustee, significant obligor, credit enhancer (10% or
                  more),
                  derivatives counterparty, Custodian

              	
                Any
                  of the following that is in bankruptcy or receivership: Master
                  Servicer,
                  Trustee, Depositor, Custodian (to be provided by
                  Trustee)

              
	
                2.04

              	
                Triggering
                  Events that Accelerate or Increase a Direct Financial Obligation
                  or an
                  Obligation under an Off-Balance Sheet Arrangement

              	 
	
                Includes
                  an early amortization, performance trigger or other event, including
                  event
                  of default, that would materially alter the payment priority/distribution
                  of cash flows/amortization schedule.

                 

                Disclosure
                  will be made of events other than waterfall triggers which are
                  disclosed
                  in the 4.06 statement

              	
                Trustee

              
	
                3.03

              	
                Material
                  Modification to Rights of Security Holders

              	 
	
                Disclosure
                  is required of any material modification to documents defining
                  the rights
                  of Certificateholders, including the Pooling and Servicing
                  Agreement

              	
                Trustee
                  (or Depositor, if the Trustee is not a party to such agreement
                  or required
                  to provide prior written consent to such amendment)

              
	
                5.03

              	
                Amendments
                  to Articles of Incorporation or Bylaws; Change in Fiscal
                  Year

              	 
	
                Disclosure
                  is required of any amendment “to the governing documents of the issuing
                  entity”

              	
                Depositor

              
	
                5.06

              	
                Change
                  in Shell Company Status

              	 
	
                [Not
                  applicable to ABS issuers]

              	
                N/A

              
	
                6.01

              	
                ABS
                  Informational and Computational Material

              	
                Depositor

              
	
                [Not
                  included in reports to be filed under Section 8.12]

              
	
                6.02

              	
                Change
                  of Servicer or Trustee

              
	
                Requires
                  disclosure of any removal, replacement, substitution or addition
                  of any
                  master servicer, affiliated servicer, other servicer servicing
                  10% or more
                  of pool assets at time of report, other material servicers, certificate
                  administrator or trustee. Reg AB disclosure about any new servicer
                  or
                  trustee is also required.

              	
                Trustee
                  

              
	
                6.03

              	
                Change
                  in Credit Enhancement or Other External Support

              	 
	
                Covers
                  termination of any enhancement in manner other than by its terms,
                  the
                  addition of an enhancement, or a material change in the enhancement
                  provided. Applies to external credit enhancements as well as derivatives.
                  Reg AB disclosure about any new enhancement provider is also
                  required.

              	
                N/A

              
	
                6.04

              	
                Failure
                  to Make a Required Distribution

              	
                Trustee

              
	
                6.05

              	
                Securities
                  Act Updating Disclosure

              	 
	
                If
                  any material pool characteristic differs by 5% or more at the time
                  of
                  issuance of the securities from the description in the final prospectus,
                  provide updated Reg AB disclosure about the actual asset
                  pool.

              	
                Depositor

              
	
                If
                  there are any new servicers or originators required to be disclosed
                  under
                  Regulation AB as a result of the foregoing, provide the information
                  called
                  for in Items 1108 and 1110 respectively.

              	
                Depositor

              
	
                7.01

              	
                Regulation
                  FD Disclosure

              	
                Depositor

              
	
                8.01

              	
                Other
                  Events

              	 
	
                Any
                  event, with respect to which information is not otherwise called
                  for in
                  Form 8-K, that the registrant deems of importance to security
                  holders.

              	
                Depositor

              
	
                9.01

              	
                Financial
                  Statements and Exhibits

              	
                The
                  Responsible Party applicable to reportable event

              
	
                10-K

              	 
	
                9B

              	
                Other
                  Information

              	 
	
                Disclose
                  any information required to be reported on Form 8-K during the
                  fourth
                  quarter covered by the Form 10-K but not reported

              	
                The
                  Responsible Party for the applicable Form 8-K item as indicated
                  above

              
	
                15

              	
                Exhibits
                  and Financial Statement Schedules

              	 
	
                Item
                  1112(b) - Significant
                  Obligor Financial Information

              	
                N/A

              
	
                Item
                  1114(b)(2) - Credit Enhancement Provider Financial
                  Information

                 

                Determining
                  applicable disclosure threshold

                 

                Obtaining
                  required financial information or effecting incorporation by
                  reference

              	
                N/A

              
	
                Item
                  1115(b) - Derivative Counterparty Financial Information

                 

                Determining
                  current maximum probable exposure

                 

                Determining
                  current significance percentage

                 

                Obtaining
                  required financial information or effecting incorporation by
                  reference

              	
                 

                 

                N/A

                 

                N/A

                 

                N/A

              
	
                Item
                  1117 - Legal proceedings pending against the following entities,
                  or their
                  respective property, that is material to Certificateholders, including
                  proceedings known to be contemplated by governmental
                  authorities:

                 

                Sponsor
                  (Seller)

                 

                 

                Depositor

                 

                Trustee

                 

                Issuing
                  entity

                 

                Servicer
                  or any other Subservicer to which Servicer delegates servicing
                  function to
                  that is servicing 20% or more of pool assets at time of
                  report

                 

                Originator
                  of 20% or more of pool assets as of the Cut-off Date

                 

                Custodian

              	
                 

                 

                 

                 

                PHH
                  Mortgage Corporation

                 

                Depositor

                 

                Trustee

                 

                Depositor

                 

                Master
                  Servicer

                 

                 

                 

                Depositor

                 

                 

                Trustee

              
	
                Item
                  1119 - Affiliations and relationships between the following entities,
                  or
                  their respective affiliates, that are material to
                  Certificateholders:

                 

                Sponsor
                  (Seller)

                 

                 

                Depositor

                 

                Trustee

                 

                Servicer
                  or any other Subservicer to which Servicer delegates servicing
                  function to
                  that is servicing 20% or more of pool assets at time of
                  report

                 

                Originator

                 

                Custodian

                 

                Counterparty

              	
                 

                 

                 

                PHH
                  Mortgage Corporation

                 

                Depositor

                 

                Trustee

                 

                Master
                  Servicer

                 

                 

                 

                Depositor

                 

                Trustee

                 

                N/A

              
	
                Item
                  1122 - Assessment of Compliance with Servicing
                  Criteria

              	
                Trustee,
                  Master Servicer, Custodian (to be provided by Trustee)

              
	
                Item
                  1123 - Servicer Compliance Statement

              	
                Master
                  Servicer

              

      

      

       

       

      EXHIBIT
        Q

       

      TRANSACTION
        PARTIES

      

      Sponsor
        -
        PHH Mortgage Corporation

      

      Depositor
        - PHH Mortgage Capital LLC

      

      Issuing
        Entity - PHHMC Series 2006-3 Trust

      

      Master
        Servicer - PHH Mortgage Corporation

      

      Originator
        - PHH Mortgage Corporation

      

      Custodian
        - Treasury Bank, a division of Countrywide Bank, N.A.

      

      Trustee
        -
        Citibank, N.A.Unassociated Document

    

       

      EXHIBIT
        4.1

       

      INDENTURE

       

      between

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3,

      as
        Issuer

       

      and

       

      U.S.
        BANK
        NATIONAL ASSOCIATION,

      as
        Indenture Trustee

       

      Relating
        To:

      The
        National Collegiate Student Loan Trust 2006-3

       

      Dated
        as
        of September 1, 2006

       

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

       

      Reconciliation
        and tie between Trust Indenture Act of 1939, as amended (the “Trust Indenture
        Act” or “TIA”) and this Indenture of Trust, dated as of September 1,
        2006.

       

      
        	
                Trust
                  Indenture Act Section

              	 	
                Indenture
                  Section

              
	
                Section 310(a)(1)

              	 	
                6.11

              
	
                Section
                  310(a)(3)

              	 	
                9.08

              
	
                Section
                  310(b)

              	 	
                6.11

              
	
                Section
                  313(c)

              	 	
                3.24,
                  9.06

              
	
                Section
                  314(c)

              	 	
                8.13

              
	
                Section
                  314(d)(1)

              	 	
                8.13

              
	
                Section
                  318

              	 	
                9.08

              

      

      ____________________

      NOTE:
        This reconciliation and tie shall not, for any purpose, be deemed to be a
        part
        of the Indenture.

       

      Attention
        should also be directed to Section 318(c) of the Trust Indenture Act, which
        provides that the provisions of Sections 310 to and including 317 of the
        Trust
        Indenture Act are a part of and govern every qualified indenture, whether
        or not
        physically contained therein.

       

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      TABLE
        OF
        CONTENTS

       

      

      
        	
                ARTICLE
                  I

              
	
                Definitions
                  and Usage

              
	
                SECTION
                  1.01

              	
                Definitions
                  and Usage

              
	 	 
	
                ARTICLE
                  II

              
	
                The
                  Notes

              
	
                SECTION
                  2.01

              	
                Form

              
	
                SECTION
                  2.02

              	
                Execution,
                  Authentication and Delivery

              
	
                SECTION
                  2.03

              	
                Temporary
                  Notes

              
	
                SECTION
                  2.04

              	
                Registration;
                  Registration of Transfer and Exchange

              
	
                SECTION
                  2.05

              	
                Mutilated,
                  Destroyed, Lost or Stolen Notes

              
	
                SECTION
                  2.06

              	
                Persons
                  Deemed Owner

              
	
                SECTION
                  2.07

              	
                Payment
                  of Principal and Interest; Defaulted Interest

              
	
                SECTION
                  2.08

              	
                Cancellation

              
	
                SECTION
                  2.09

              	
                Release
                  of Collateral

              
	
                SECTION
                  2.10

              	
                Book-Entry
                  Notes

              
	
                SECTION
                  2.11

              	
                Notices
                  to Clearing Agency

              
	
                SECTION
                  2.12

              	
                Definitive
                  Notes

              
	
                SECTION
                  2.13

              	
                Tax
                  Treatment

              
	 	 
	
                ARTICLE
                  III

              
	
                Covenants

              
	
                SECTION
                  3.01

              	
                Payment
                  to Noteholders and Liquidity Provider

              
	
                SECTION
                  3.02

              	
                Maintenance
                  of Office or Agency

              
	
                SECTION
                  3.03

              	
                Money
                  for Payments To Be Held in Trust

              
	
                SECTION
                  3.04

              	
                Existence

              
	
                SECTION
                  3.05

              	
                Protection
                  of Indenture Trust Estate

              
	
                SECTION
                  3.06

              	
                Opinions
                  as to Indenture Trust Estate

              
	
                SECTION
                  3.07

              	
                Performance
                  of Obligations; Servicing of Financed Student Loans

              
	
                SECTION
                  3.08

              	
                Negative
                  Covenants

              
	
                SECTION
                  3.09

              	
                Annual
                  Statement as to Compliance

              
	
                SECTION
                  3.10

              	
                Issuer
                  May Consolidate, etc

              
	
                SECTION
                  3.11

              	
                Successor
                  or Transferee

              
	
                SECTION
                  3.12

              	
                No
                  Other Business

              
	
                SECTION
                  3.13

              	
                No
                  Borrowing

              
	
                SECTION
                  3.14

              	
                Disposing
                  of Financed Student Loans

              
	
                SECTION
                  3.15

              	
                Guarantees,
                  Loans, Advances and Other Liabilities

              
	
                SECTION
                  3.16

              	
                Capital
                  Expenditures

              
	
                SECTION
                  3.17

              	
                Restricted
                  Payments

              
	
                SECTION
                  3.18

              	
                Notice
                  of Events of Default

              
	
                SECTION
                  3.19

              	
                Further
                  Instruments and Acts

              
	
                SECTION
                  3.20

              	
                Additional
                  Covenants

              
	
                SECTION
                  3.21

              	
                Covenant
                  Regarding Financed Student Loans

              
	
                SECTION
                  3.22

              	
                Additional
                  Representations of the Issuer

              
	
                SECTION
                  3.23

              	
                Issuer
                  Separateness Covenants

              
	
                SECTION
                  3.24

              	
                Reports
                  by Issuer

              
	 	 
	
                ARTICLE
                  IV

              
	
                Satisfaction
                  and Discharge

              
	
                SECTION
                  4.01

              	
                Satisfaction
                  and Discharge of Indenture

              
	
                SECTION
                  4.02

              	
                Application
                  of Trust Money

              
	
                SECTION
                  4.03

              	
                Repayment
                  of Moneys Held by Paying Agent

              
	 	 
	
                ARTICLE
                  V

              
	
                Remedies

              
	
                SECTION
                  5.01

              	
                Events
                  of Default

              
	
                SECTION
                  5.02

              	
                Acceleration
                  of Maturity; Rescission and Annulment

              
	
                SECTION
                  5.03

              	
                Collection
                  of Indebtedness and Suits for Enforcement by Indenture
                  Trustee

              
	
                SECTION
                  5.04

              	
                Remedies;
                  Priorities

              
	
                SECTION
                  5.05

              	
                Optional
                  Preservation of the Financed Student Loans

              
	
                SECTION
                  5.06

              	
                Limitation
                  of Suits

              
	
                SECTION
                  5.07

              	
                Unconditional
                  Rights of Noteholders To Receive Principal and Interest

              
	
                SECTION
                  5.08

              	
                Restoration
                  of Rights and Remedies

              
	
                SECTION
                  5.09

              	
                Rights
                  and Remedies Cumulative

              
	
                SECTION
                  5.10

              	
                Delay
                  or Omission Not a Waiver

              
	
                SECTION
                  5.11

              	
                Control
                  by Noteholders

              
	
                SECTION
                  5.12

              	
                Waiver
                  of Past Defaults

              
	
                SECTION
                  5.13

              	
                Undertaking
                  for Costs

              
	
                SECTION
                  5.14

              	
                Waiver
                  of Stay or Extension Laws

              
	
                SECTION
                  5.15

              	
                Action
                  on Notes

              
	
                SECTION
                  5.16

              	
                Performance
                  and Enforcement of Certain Obligations

              
	
                SECTION
                  5.17

              	
                Notice
                  of Defaults

              
	 	 
	
                ARTICLE
                  VI

              
	
                The
                  Indenture Trustee

              
	
                SECTION
                  6.01

              	
                Duties
                  of Indenture Trustee

              
	
                SECTION
                  6.02

              	
                Rights
                  of Indenture Trustee

              
	
                SECTION
                  6.03

              	
                Individual
                  Rights of Indenture Trustee

              
	
                SECTION
                  6.04

              	
                Indenture
                  Trustee’s Disclaimer

              
	
                SECTION
                  6.05

              	
                Notice
                  of Defaults

              
	
                SECTION
                  6.06

              	
                Reports
                  by Indenture Trustee to Noteholders

              
	
                SECTION
                  6.07

              	
                Compensation
                  and Indemnity

              
	
                SECTION
                  6.08

              	
                Replacement
                  of Indenture Trustee

              
	
                SECTION
                  6.09

              	
                Successor
                  Indenture Trustee by Merger

              
	
                SECTION
                  6.10

              	
                Appointment
                  of Co-Trustee or Separate Trustee

              
	
                SECTION
                  6.11

              	
                Eligibility;
                  Disqualification

              
	 	 
	
                ARTICLE
                  VII

              
	
                Noteholders’
                  Lists and Reports

              
	
                SECTION
                  7.01

              	
                Issuer
                  To Furnish Indenture Trustee Names and Addresses of
                  Noteholders

              
	
                SECTION
                  7.02

              	
                Preservation
                  of Information; Communications to Noteholders

              
	
                SECTION
                  7.03

              	
                Reports
                  by Issuer

              
	 	 
	
                ARTICLE
                  VIII

              
	
                Accounts,
                  Disbursements and Releases

              
	
                SECTION
                  8.01

              	
                Collection
                  of Money

              
	
                SECTION
                  8.02

              	
                Trust
                  Accounts

              
	
                SECTION
                  8.03

              	
                General
                  Provisions Regarding Accounts

              
	
                SECTION
                  8.04

              	
                Release
                  of Indenture Trust Estate

              
	
                SECTION
                  8.05

              	
                Opinion
                  of Counsel

              
	
                SECTION
                  8.06

              	
                Cost
                  of Issuance Account

              
	
                SECTION
                  8.07

              	
                Application
                  of Collections

              
	
                SECTION
                  8.08

              	
                Reserve
                  Account

              
	
                SECTION
                  8.09

              	
                Statements
                  to Noteholders

              
	
                SECTION
                  8.10

              	
                Liquidity
                  Note Agreement

              
	
                SECTION
                  8.11

              	
                Advances

              
	 	 
	
                ARTICLE
                  IX

              
	
                Supplemental
                  Indentures

              
	
                SECTION
                  9.01

              	
                Supplemental
                  Indentures Without Consent of Noteholders

              
	
                SECTION
                  9.02

              	
                Supplemental
                  Indentures with Consent of Noteholders

              
	
                SECTION
                  9.03

              	
                Execution
                  of Supplemental Indentures

              
	
                SECTION
                  9.04

              	
                Effect
                  of Supplemental Indenture

              
	
                SECTION
                  9.05

              	
                Reference
                  in Notes to Supplemental Indentures

              
	
                SECTION
                  9.06

              	
                Conformity
                  With the Trust Indenture Act

              
	 	 
	
                ARTICLE
                  X

              
	
                Reporting
                  Requirements

              
	
                SECTION
                  10.01

              	
                Annual
                  Statement as to Compliance

              
	
                SECTION
                  10.02

              	
                Annual
                  Independent Public Accountants’ Servicing Report

              
	
                SECTION
                  10.03

              	
                Assessment
                  of Compliance and Attestation Reports

              
	 	 
	
                ARTICLE
                  XI

              
	
                Miscellaneous

              
	
                SECTION
                  11.01

              	
                Compliance
                  Certificates and Opinions, etc

              
	
                SECTION
                  11.02

              	
                Form
                  of Documents Delivered to Indenture Trustee

              
	
                SECTION
                  11.03

              	
                Acts
                  of Noteholders

              
	
                SECTION
                  11.04

              	
                Notices,
                  etc

              
	
                SECTION
                  11.05

              	
                Notices
                  to Noteholders; Waiver

              
	
                SECTION
                  11.06

              	
                Alternate
                  Payment and Notice Provisions

              
	
                SECTION
                  11.07

              	
                Effect
                  of Headings and Table of Contents

              
	
                SECTION
                  11.08

              	
                Successors
                  and Assigns

              
	
                SECTION
                  11.09

              	
                Separability

              
	
                SECTION
                  11.10

              	
                Benefits
                  of Indenture

              
	
                SECTION
                  11.11

              	
                Legal
                  Holidays

              
	
                SECTION
                  11.12

              	
                Governing
                  Law

              
	
                SECTION
                  11.13

              	
                Counterparts

              
	
                SECTION
                  11.14

              	
                Recording
                  of Indenture

              
	
                SECTION
                  11.15

              	
                Trust
                  Obligations

              
	
                SECTION
                  11.16

              	
                No
                  Petition

              
	
                SECTION
                  11.17

              	
                Inspection

              
	
                SECTION
                  11.18

              	
                Third-Party
                  Beneficiaries

              

      

      

      
        	
                APPENDIX
                  A

              	
                Definitions
                  and Usage

              
	 	 
	
                SCHEDULE
                  A

              	
                Schedule
                  of Financed Student Loans

              
	
                SCHEDULE
                  B

              	
                List
                  of TERI Guaranty Agreements

              
	
                SCHEDULE
                  C

              	
                List
                  of Student Loan Purchase Agreements

              

      

      

      

      
        	
                EXHIBIT
                  A-1

              	
                Form
                  of Class A-1 Note

              
	
                EXHIBIT
                  A-2

              	
                Form
                  of Class A-2 Note

              
	
                EXHIBIT
                  A-3

              	
                Form
                  of Class A-3 Note

              
	
                EXHIBIT
                  A-4

              	
                Form
                  of Class A-4 Note

              
	
                EXHIBIT
                  A-5

              	
                Form
                  of Class A-5 Note

              
	
                EXHIBIT
                  A-6

              	
                Form
                  of Class A-IO Note

              
	
                EXHIBIT
                  A-7

              	
                Form
                  of Class B Note

              
	
                EXHIBIT
                  A-8

              	
                Form
                  of Class C Note

              
	
                EXHIBIT
                  A-9

              	
                Form
                  of Class D Note

              
	
                EXHIBIT
                  B

              	
                [RESERVED]

              
	
                EXHIBIT
                  C

              	
                Relevant
                  Servicing Criteria

              

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      INDENTURE
        dated as of September 1, 2006, between THE NATIONAL COLLEGIATE STUDENT LOAN
        TRUST 2006-3, a Delaware statutory trust (the “Issuer”), and U.S. BANK NATIONAL
        ASSOCIATION, a national banking association, as trustee and not in its
        individual capacity (the “Indenture Trustee”).

       

       

      W I T N E S S E T H:

       

      WHEREAS,
        the Issuer is duly created as a statutory trust under the laws of the State
        of
        Delaware and by proper action has duly authorized the execution and delivery
        of
        this Indenture, which Indenture provides for the issuance of student loan
        asset-backed notes to finance the acquisition of certain student loans from
        The
        National Collegiate Funding LLC (the “Depositor”) and the payment to holders of
        the Notes; and

       

      WHEREAS,
        this Indenture is subject to the provisions
        of
        the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act” or
“TIA”), that are deemed to be incorporated into this Indenture and shall, to the
        extent applicable, be governed by such provisions;

       

      NOW,
        THEREFORE, each party agrees as follows for the benefit of the other party
        and
        for the equal and ratable benefit of the holders of the Issuer’s Class A-1 Notes
        (the “Class A-1 Notes”), Class A-2 Notes (the “Class A-2 Notes”), Class A-3
        Notes (the “Class A-3 Notes”), Class A-4 Notes (the “Class A-4 Notes”), Class
        A-5 Notes (the “Class A-5 Notes”), Class A-IO Notes (the “Class A-IO Notes”),
        Class B Notes (the “Class B Notes”), Class C Notes (the “Class C Notes”), Class
        D Notes (the “Class D Notes” and together with the Class A-1 Notes, the Class
        A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class A-5 Notes,
        the
        Class A-IO Notes, the Class B Notes and the Class C Notes, the “Notes”) and the
        Liquidity Provider:

       

      GRANTING
        CLAUSE

       

      The
        Issuer hereby Grants to the Indenture Trustee at the Closing Date with respect
        to the Financed Student Loans, as trustee for the benefit of the holders
        of the
        Notes and the Liquidity Provider, all the Issuer’s right, title and interest in
        and to the following:

       

      (a)  the
        Financed Student Loans, and all obligations of the Obligors thereunder including
        all moneys paid thereunder on or after the Cutoff Date;

       

      (b)  all
        Servicing Agreements and all Student Loan Purchase Agreements, including
        the
        right of the Issuer to cause the Sellers to repurchase or the Servicers to
        purchase, Student Loans from the Issuer under circumstances described
        therein;

       

      (c)  each
        Guarantee Agreement, including the right of the Issuer to cause the Guarantee
        Agency to make Guarantee Payments in respect of the Student Loans, the TERI
        Deposit and Security Agreement and the Issuer’s rights to the TERI Pledge Fund
        as the same relate to the Student Loans and the proceeds thereof, and each
        of
        the other Basic Documents;

       

      (d)  all
        funds
        on deposit from time to time in the Trust Accounts related to the Notes (and
        sub-accounts thereof), including the Reserve Account Initial Deposit;

       

      (e)  the
        Liquidity Note Agreement; and

       

      (f)  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,
        including all proceeds of the conversion, voluntary or involuntary, into
        cash or
        other liquid property, all cash proceeds, accounts, accounts receivable,
        notes,
        drafts, acceptances, chattel paper, checks, deposit accounts, insurance
        proceeds, condemnation awards, 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, “Collateral”).

       

      The
        foregoing Grant is made in trust to secure the payment of principal of and/or
        interest on, as applicable, and any other amounts owing in respect of, the
        Notes
        and under the Liquidity Note Agreement, equally and ratably, without prejudice,
        priority or distinction, except as otherwise provided for herein, and to
        secure
        compliance with the provisions of this Indenture, all as provided in this
        Indenture.

       

      The
        Indenture Trustee, as Indenture Trustee on behalf of the holders of the Notes
        and the Liquidity Provider, acknowledges such Grant, accepts the trusts under
        this Indenture in accordance with the provisions of this Indenture and agrees
        to
        perform its duties required in this Indenture to the best of its ability
        to the
        end that the interests of the holders of the Notes and the Liquidity Provider
        may be adequately and effectively protected.

       

      ARTICLE
        I

       

      Definitions
        and Usage

       

      SECTION
        1.01  Definitions
        and Usage.
        Except
        as otherwise specified herein or as the context may otherwise require,
        capitalized terms used but not defined herein are defined in Appendix A
        hereto, which also contain rules as to usage that shall be applicable
        herein.

       

      ARTICLE
        II

       

      The
        Notes

       

      SECTION
        2.01  Form.
        The
        Notes, together with the Indenture Trustee’s certificate of authentication,
        shall be in substantially the forms set forth in Exhibits A-1 through A-9,
        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
        the 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
        Definitive 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 officers executing such Notes, as evidenced
        by their execution of such Notes.

       

      Each
        Note
        shall be dated the date of its authentication. The terms of the Notes set
        forth
        in Exhibits A-1 through A-9, 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 an Issuer Order authenticate and deliver Notes
        for
        original issue in (i) an aggregate principal amount of $323,600,000 with
        respect
        to the Class A-1 Notes, $306,230,000 with respect to the Class A-2 Notes,
        $322,790,000 with respect to the Class A-3 Notes, $294,510,000 with respect
        to
        the Class A-4 Notes, $325,130,000 with respect to the Class A-5 Notes,
        $94,810,000 with respect to the Class B Notes, $92,450,000 with respect to
        the
        Class C Notes and $83,870,000 with respect to the Class D Notes and (ii)
        an
        aggregate Notional Amount of $325,130,000 with respect to the Class A-IO
        Notes.

       

      Each
        Note
        shall be dated the date of its authentication. The Notes shall be issuable
        as
        registered Notes in minimum denominations (or in the case of the Class A-IO
        Notes, minimum Notional Amounts) of $100,000 and in integral multiples of
        $1,000
        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.

       

      SECTION
        2.03  Temporary
        Notes.
        Pending
        the preparation of Definitive Notes, the Issuer may execute, and upon receipt
        of
        an Issuer Order the Indenture Trustee shall authenticate and deliver, temporary
        Notes which are printed, lithographed, typewritten, mimeographed or otherwise
        produced, of the tenor of the Definitive Notes in lieu of which they are
        issued
        and with such variations not inconsistent with the terms of this Indenture
        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 Definitive
        Notes,
        the temporary Notes shall be exchangeable for Definitive Notes upon surrender
        of
        the temporary Notes at the office or agency of the Issuer to be maintained
        as
        provided in Section 3.02, without charge to the holder of the Notes. Upon
        surrender for cancellation of any one or more temporary Notes, the Issuer
        shall
        execute and the Indenture Trustee shall authenticate and deliver in exchange
        therefor a like initial principal amount or initial Notional Amount, as
        applicable, of Definitive Notes of authorized denominations. Until so exchanged,
        the temporary Notes shall in all respects be entitled to the same benefits
        under
        this Indenture as Definitive Notes.

       

      SECTION
        2.04  Registration;
        Registration of Transfer and Exchange.
        (a) The
        Indenture Trustee shall cause to be kept a register (the “Note Register”) in
        which, subject to such reasonable regulations as it may prescribe, the Issuer
        shall provide for the registration of Notes and the registration of transfers
        and exchanges of Notes as herein provided. The Indenture Trustee shall be
“Note
        Registrar” for the purpose of registering Notes and transfers of Notes as herein
        provided. Upon any resignation of any Note Registrar, the Issuer shall promptly
        appoint a successor.

       

      (b)  If
        a
        Person other than the Indenture Trustee is appointed by the Issuer as Note
        Registrar, the Issuer will give the Indenture Trustee prompt written notice
        of
        the appointment of such Note Registrar and of the location, and any change
        in
        the location, of the Note Register, and the Indenture Trustee shall have
        the
        right to inspect the Note Register at all reasonable times and to obtain
        copies
        thereof, and the Indenture Trustee shall have the right to rely upon a
        certificate executed on behalf of the Note Registrar by an Executive Officer
        thereof as to the names and addresses of the holders of the Notes and the
        principal amounts or Notional Amount, as applicable, and number of such
        Notes.

       

      (c)  Every
        Note presented or surrendered for registration of transfer or exchange shall
        be
        duly endorsed by, or be accompanied by a written instrument of transfer in
        form
        satisfactory to the Indenture Trustee duly executed by the holder of the
        Notes
        thereof 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 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
        Exchange Act.

       

      (d)  No
        service charge shall be made to a holder of the Notes for any registration
        of
        transfer or exchange of Notes, but the Indenture Trustee may require payment
        of
        a sum sufficient to cover any tax or other governmental charge that may be
        imposed in connection with any registration of transfer or exchange of Notes,
        other than exchanges pursuant to Section 2.03 or 9.05 not involving any
        transfer.

       

      (e)  On
        the
        Closing Date, the Issuer will execute and the Indenture Trustee will, upon
        Issuer Order, authenticate one or more Global Notes in an aggregate principal
        amount (or, in the case of the Class A-IO Notes, an aggregate Notional Amount)
        that shall equal the applicable Original Principal Balance for each Class
        of
        Notes.

       

      The
        Global Notes, pursuant to the Depository’s instructions, shall be delivered by
        the Administrator on behalf of the Depository to and deposited with the DTC
        Custodian, and shall be registered in the name of Cede & Co. and shall bear
        a legend substantially to the following effect:

       

      “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
        Global Notes may be deposited with such other Depository as the Administrator
        may from time to time designate, and shall bear such legend as may be
        appropriate; provided
        that
        such successor Depository maintains a book-entry system that qualifies to
        be
        treated as “registered form” under Section 163(f) of the Code.

       

      The
        Issuer and the Indenture Trustee are hereby authorized to execute and deliver
        a
        Note Depository Agreement with the Depository relating to the Global
        Notes.

       

      (f)  With
        respect to Notes registered in the Note Register in the name of Cede & Co.,
        as nominee of the Depository, the Administrator, the Back-Up Administrator,
        the
        Owner Trustee and the Indenture Trustee shall have no responsibility or
        obligation to Participants or Indirect Participants or Beneficial Owners
        for
        which the Depository holds Notes from time to time as a Depository. Without
        limiting the immediately preceding sentence, the Administrator, the Back-Up
        Administrator, the Owner Trustee and the Indenture Trustee shall have no
        responsibility or obligation with respect to (a) the accuracy of the records
        of
        the Depository, Cede & Co., or any Participant or Indirect Participant or
        Beneficial Owners with respect to the ownership interest in the Notes, (b)
        the
        delivery to any Participant or Indirect Participant or any other Person,
        other
        than a registered Noteholder, (c) the payment to any Participant or Indirect
        Participant or any other Person, other than a registered Noteholder as shown
        in
        the Note Register, of any amount with respect to any distribution of principal
        or interest on the Notes or (d) the making of book-entry transfers among
        Participants of the Depository with respect to Notes registered in the Note
        Register in the name of the nominee of the Depository. No Person other than
        a
        registered Noteholder as shown in the Note Register shall receive a Note
        evidencing such Note.

       

      (g)  Upon
        delivery by the Depository to the Indenture Trustee of written notice to
        the
        effect that the Depository has determined to substitute a new nominee in
        place
        of Cede & Co., and subject to the provisions hereof with respect to the
        payment of distributions by the mailing of checks or drafts to the registered
        Noteholder appearing as registered owners in the Note Register on a Record
        Date,
        the name “Cede & Co.” in this Indenture shall refer to such new nominee of
        the Depository.

       

      Subject
        to the preceding paragraphs, upon surrender for registration of transfer
        of any
        Note at the office of the Note Registrar and, upon satisfaction of the
        conditions set forth below, the Issuer shall execute in the name of the
        designated transferee or transferees, a new Note of the same principal balance
        or Notional Amount and dated the date of authentication by the Indenture
        Trustee. The Note Registrar shall notify the Administrator and the Indenture
        Trustee of any such transfer.

       

      No
        Note
        may be acquired directly or indirectly by a fiduciary of, on behalf of, or
        with
“Plan Assets” (within the meaning of Section 2510.3-101 of the U.S. Department
        of Labor regulations (the “Plan Asset Regulation”)) of, an “employee benefit
        plan” as defined in Section 3(3) of ERISA, a “plan” within the meaning of
        Section 4975 of the Code or any other entity whose underlying assets include
        Plan Assets by reason of any plan’s investment in the entity, which is subject
        to Title I of ERISA or Section 4975 of the Code (a “Plan”), unless (i) such Note
        is rated investment grade or better as of the date of purchase, (ii) the
        transferee of the Note believes that the Note is properly treated as
        indebtedness without substantial equity features for purposes of the Plan
        Asset
        Regulation and agrees to so treat such Note and (iii) the acquisition and
        holding of the Note do not result in a violation of the prohibited transaction
        rules of ERISA or Section 4975 of the Code (A) because it is covered by an
        applicable exemption, including Prohibited Transaction Class Exemption 96-23,
        95-60, 91-38, 90-1 or 84-14, or (B) by reason of the Trust, the Administrator,
        the Back-up Administrator, the Underwriters, the Servicers, the Indenture
        Trustee, the Owner Trustee, the Liquidity Provider, any other provider of
        credit
        support or any of their affiliates not being a “Party in Interest” (within the
        meaning of Section 3(14) of ERISA) with respect to such Plan. Any transferee
        of
        a Note shall be deemed to have represented that such transferee is acquiring
        a
        Note in conformance with the requirements of the preceding
        sentence.

       

      The
        Indenture Trustee shall have no obligation or duty to monitor, determine
        or
        inquire as to compliance with any restrictions on transfer imposed under
        this
        Indenture or under applicable law with respect to any transfer of any interest
        in any Note (including any transfers between or among Participants, members
        or
        Beneficial Owners in any Note) other than to require delivery of such
        certificates and other documentation or evidence as are expressly required
        by,
        and to do so if and when expressly required by, the terms of this Indenture,
        and
        to examine the same to determine substantial compliance as to form with the
        express requirements hereof.

       

      SECTION
        2.05  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 15 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, the Issuer may require
        the
        payment by the holder of the Notes thereof 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 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 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
        2.06  Persons
        Deemed Owner.
        Prior
        to due presentment for registration of transfer of any Note, the Issuer,
        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
        (with respect to each Class of Notes other than the Class A-IO Notes) and
        interest on such Note and for all other purposes whatsoever, whether or not
        such
        Note be overdue, and neither the Issuer or the Indenture Trustee nor any
        agent
        of the Issuer or the Indenture Trustee shall be affected by notice to the
        contrary.

       

      SECTION
        2.07  Payment
        of Principal and Interest; Defaulted Interest.
        (a) Each
        Class of Notes shall accrue interest as provided in the applicable form of
        such
        Class set forth in Exhibits A-1 through A-9 respectively, and such interest
        accrued on each Class of Notes shall be payable on each applicable Distribution
        Date as specified therein and in the order set forth in Section 8.02 hereof,
        subject to Section 3.01. Any installment of interest or principal, if any,
        with respect to each Class of Notes payable on any applicable Note which
        is
        punctually paid or duly provided for by the Issuer on the applicable
        Distribution Date shall be paid to the Person in whose name such Note (or
        one or
        more Predecessor Notes) is registered on the Record Date by check mailed
        first-class, postage prepaid to such Person’s address as it appears on the Note
        Register on such Record Date, except that, unless Definitive Notes have been
        issued pursuant to Section 2.12, with respect to Notes registered on the
        Record Date in the name of the nominee of the Clearing Agency (initially,
        such
        nominee to be Cede & Co.), payment will be made by wire transfer in
        immediately available funds to the account designated by such nominee and
        except
        for the final installment of principal payable with respect to such Note
        on a
        Distribution Date or on the applicable Note Final Maturity Date which shall
        be
        payable as provided below. The funds represented by any such checks returned
        undelivered shall be held in accordance with Section 3.03.

       

      (b)  The
        principal of each Note (other than the Class A-IO Notes) shall be payable
        in
        installments on each Distribution Date as provided in the applicable form
        of
        Note set forth in Exhibits A-1 through A-9, respectively, to the extent the
        amount of funds required and available to be distributed in respect of principal
        on such Class of Notes pursuant to the terms of this Indenture; provided,
        however,
        the
        entire unpaid principal amount of each Class of Notes, other than the Class
        A-IO
        Notes, shall be due and payable on its respective Final Maturity Date.
        Notwithstanding the foregoing, the entire unpaid principal amount of the
        Notes,
        other than the Class A-IO Notes, shall be due and payable, if not previously
        paid, on the date on which an Event of Default shall have occurred and is
        continuing, if the Indenture Trustee or the Interested Noteholders holding
        a
        majority of the Outstanding Amount of the related Classes of Notes have declared
        the Notes to be immediately due and payable in the manner provided in
        Section 5.02. All principal payments on each Class of Class A Notes, other
        than the Class A-IO Notes, shall be made pro rata
        to the
        holders of such Class of Notes entitled thereto. The Indenture Trustee shall
        notify the Person in whose name a Note is registered at the close of business
        on
        the Record Date preceding the Distribution Date on which the Issuer expects
        that
        the final installment of principal of and interest on any Class of Notes,
        other
        than the Class A-IO Notes, will be paid. Such notice shall be mailed or
        transmitted by facsimile prior to such final Distribution Date and shall
        specify
        that such final installment 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 payment of such installment.

       

      (c)  If
        the
        Issuer defaults in a payment of interest on any Class of the Notes, the Issuer
        shall pay defaulted interest (plus interest on such defaulted interest to
        the
        extent lawful) at the applicable Note Interest Rate in any lawful manner.
        The
        Issuer shall pay such defaulted interest to the persons who are holders of
        such
        Class or Classes of Notes on a subsequent special record date, which date
        shall
        be at least three Business Days prior to the payment date. The Issuer shall
        fix
        or cause to be fixed any such special record date and payment date, and,
        at
        least 15 days before any such special record date, the Issuer shall mail
        to each
        holder of the affected Class or Classes of Notes and the Indenture Trustee
        a
        notice that states the special record date, the payment date and the amount
        of
        defaulted interest to be paid.

       

      SECTION
        2.08  Cancellation.
        All
        Notes surrendered for payment, registration of transfer or exchange 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 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, 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 Order that they be returned to it and so long as such Issuer Order
        is
        timely and the Notes have not been previously disposed of by the Indenture
        Trustee.

       

      SECTION
        2.09  Release
        of Collateral.
        Subject
        to Section 11.01 and the terms of the Basic Documents, the Indenture
        Trustee shall release property from the lien of this Indenture only upon
        receipt
        of an Issuer Request accompanied by an Officers’ Certificate of the
        Issuer.

       

      SECTION
        2.10  Book-Entry
        Notes.
        The
        Notes, upon original issuance, will be issued in the form of typewritten
        Notes
        representing the Book-Entry Notes, to be delivered to The Depository Trust
        Company, the initial Clearing Agency, by, or on behalf of, the Issuer. Such
        Notes shall initially be registered on the Note Register in the name of Cede
        & Co., the nominee of the initial Clearing Agency, and no Note Owner will
        receive a Definitive Note (as defined below) representing such Note Owner’s
        interest in such Note, except as provided in Section 2.12. Unless and until
        definitive, fully registered Notes (the “Definitive Notes”) have been issued to
        Note Owners pursuant to Section 2.12:

       

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

       

      (ii)  the
        Note
        Registrar and the Indenture Trustee may deal with the Clearing Agency for
        all
        purposes (including the payment of principal of and interest and other amounts
        on the Notes) as the authorized representative of the Note Owners;

       

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

       

      (iv)  the
        rights of Note Owners shall be exercised only through the Clearing Agency
        and
        shall be limited to those established by law and agreements between such
        Note
        Owners and the Clearing Agency and/or the Clearing Agency Participants pursuant
        to the Note Depository Agreements. Unless and until Definitive Notes are
        issued
        pursuant to Section 2.12, the initial Clearing Agency will make book-entry
        transfers among the Clearing Agency Participants and receive and transmit
        payments of principal of and interest and other amounts on the Notes to such
        Clearing Agency Participants; and

       

      (v)  whenever
        this Indenture requires or permits actions to be taken based upon instructions
        or directions of the holders of the Notes evidencing a specified percentage
        of
        the Outstanding Amount of the Notes, the Clearing Agency shall be deemed
        to
        represent such percentage only to the extent that it has received instructions
        to such effect from Note Owners and/or Clearing Agency 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
        2.11  Notices
        to Clearing Agency.
        Whenever a notice or other communication to the holders of the Notes is required
        under this Indenture, unless and until Definitive Notes shall have been issued
        to Note Owners pursuant to Section 2.12, the Indenture Trustee shall give
        all such notices and communications specified herein to be given to the holders
        of the Notes to the Clearing Agency.

       

      SECTION
        2.12  Definitive
        Notes.
        If
        (i) the Administrator advises the Indenture Trustee in writing that the
        Clearing Agency is no longer willing or able to properly discharge its
        responsibilities with respect to the Notes, and the Administrator is unable
        to
        locate a qualified successor, (ii) circumstances change so that the book-entry
        system through the Clearing Agency is less advantageous due to economic or
        administrative burden or the use of the book-entry system becomes unlawful
        with
        respect to the Notes or the Issuer notifies the Indenture Trustee in writing
        that because of the change in circumstances the Issuer is terminating the
        book-entry system with respect to the Notes or (iii) after the occurrence
        of an
        Event of Default, Note Owners representing beneficial interests aggregating
        at
        least a majority of the Outstanding Amount of such Class of Notes advise
        the
        Clearing Agency (which shall then notify the Indenture Trustee) in writing
        that
        the continuation of a book-entry system through the Clearing Agency is no
        longer
        in the best interests of the Note Owners of such Class of Notes, then the
        Indenture Trustee will cause the Clearing Agency to notify all Note Owners
        of
        such Class of Notes, through the Clearing Agency, of the occurrence of any
        such
        event and of the availability of Definitive Notes to such Note Owners requesting
        the same. Upon surrender to the Indenture Trustee of the typewritten Notes
        representing the Book-Entry Notes by the Clearing Agency, accompanied by
        registration instructions, the Issuer shall execute and the Indenture Trustee
        shall authenticate the Definitive Notes in accordance with the instructions
        of
        the Clearing Agency. 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 the Noteholders for such Class of
        Notes.

       

      SECTION
        2.13  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, 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, agree to treat the Notes for federal, state and local income, business
        and
        franchise tax purposes as indebtedness of the Issuer.

       

      ARTICLE
        III

       

      Covenants

       

      SECTION
        3.01  Payment
        to Noteholders and Liquidity Provider.
        The
        Issuer will duly and punctually pay the principal of and interest owing on
        each
        Class of Notes (and in the case of Class A-IO Notes, interest and Prepayment
        Penalties) pursuant to the terms of this Indenture and amounts owing to the
        Liquidity Provider pursuant to the terms of the Liquidity Note Agreement.
        Without limiting the foregoing, subject to Section 8.02, the Issuer will
        cause
        to be distributed to the holders of the each Class of Notes and the Liquidity
        Provider that portion of the amounts on deposit in the Trust Accounts on
        a
        Distribution Date, to which the holders of each Class of Notes and the Liquidity
        Provider are entitled to receive pursuant to the terms of this Indenture
        and the
        Liquidity Note Agreement. Amounts properly withheld under the Code by any
        Person
        from a payment to any holder of the Notes or the Liquidity Provider of interest
        on and/or principal of shall be considered as having been paid by the Issuer
        to
        such holder of the applicable Notes or to the Liquidity Provider for all
        purposes of this Indenture. The Notes and amounts owing to the Liquidity
        Provider pursuant to the terms of the Liquidity Note Agreement will be
        non-recourse obligations of the Issuer and shall be limited in right of payment
        to amounts available from the Indenture Trust Estate as provided in this
        Indenture and the Issuer shall not be otherwise liable on the Notes or under
        the
        Liquidity Note Agreement. Upon a Ratings
        Downgrade,
        as
        described and defined in the Liquidity Note Agreement, the Liquidity Provider
        may designate by written notice to the Issuer and the Indenture Trustee all
        or
        any amount of the payments due to it under Section 8.02(d) to be paid to
        the
        Liquidity Facility Guarantor. 

       

      SECTION
        3.02  Maintenance
        of Office or Agency.
        The
        Issuer will maintain in the Borough of Manhattan, The City of New York, an
        office or agency where Notes may be surrendered for registration of transfer
        or
        exchange. The Issuer hereby initially designates U.S. Bank National Association,
        U.S. Bank Trust New York, 100 Wall Street, Suite 1600, New York, New York
        10005
        to serve as its agent for the foregoing purposes. The Issuer will give prompt
        written notice to the Indenture Trustee of the location, and of any change
        in
        the location, of any such office or agency. 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 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 in respect of the Notes.

       

      SECTION
        3.03  Money
        for Payments To Be Held in Trust.
        As
        provided in Section 8.02, all payments of amounts due and payable with respect
        to any Notes or under the Liquidity Note Agreement, that are to be made from
        amounts distributed from the Collection Account or any other Trust Account
        pursuant to Section 8.02 shall be made on behalf of the Issuer by the Indenture
        Trustee or by another Paying Agent, and no amounts so distributed from the
        Collection Account for payments of Notes or under the Liquidity Note Agreement
        shall be paid over to the Issuer except as provided in this Section. The
        Indenture Trustee is hereby appointed as the initial “Paying Agent” hereunder
        and the Indenture Trustee hereby accepts such appointment.

       

      On
        or
        before the Business Day next preceding each Distribution Date, the Issuer
        shall
        distribute or cause to be distributed to the Indenture Trustee (or any other
        Paying Agent) an aggregate sum sufficient to pay the amounts then becoming
        due
        under each Class of the Notes and under the Liquidity Note Agreement, such
        sum
        to be held in trust for the benefit of the Persons entitled thereto and (unless
        the Paying Agent is the Indenture Trustee) shall promptly notify the Indenture
        Trustee of its action or failure so to act.

       

      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,
        that such Paying Agent will:

       

      (i)  hold
        all
        sums held by it for the payment of amounts due with respect to each Class
        of the
        Notes and under the Liquidity Note Agreement 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 notice of any default by the Issuer of which it has actual
        knowledge (or any other obligor upon the Notes) in the making of any payment
        required to be made with respect to any Class of Notes and under the Liquidity
        Note Agreement;

       

      (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;

       

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

       

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

       

      The
        Administrator may at any time, for the purpose of obtaining the satisfaction
        and
        discharge of this Indenture or for any other purpose, by written order 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 two years 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 Notes thereof 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 a newspaper published in the English language, customarily
        published on each Business Day and of general circulation in The City of
        New
        York, 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.

       

      SECTION
        3.04  Existence.
        The
        Issuer will keep in full effect its existence, rights and franchises as a
        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
        Collateral and each other instrument or agreement included in the Indenture
        Trust Estate.

       

      SECTION
        3.05  Protection
        of Indenture Trust Estate.
        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)  enforce
        any of the Collateral; or

       

      (iv)  preserve
        and defend title to the Indenture Trust Estate and the rights of the Indenture
        Trustee, and the holders of the Notes and the Liquidity Provider in such
        Indenture Trust Estate against the claims of all persons and
        parties.

       

      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.

       

      SECTION
        3.06  Opinions
        as to Indenture Trust Estate.
        (a)  On
        the Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion
        of Counsel 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 of this Indenture 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.

       

      (b)  On
        or
        before April 30 in each calendar year, beginning in 2007, the Issuer shall
        furnish to the Indenture Trustee an Opinion of Counsel either stating that,
        in
        the opinion of such counsel, such action has been taken with respect to the
        recording, filing, re-recording 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 created by this
        Indenture 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 of this
        Indenture until April 30 in the following calendar year.

       

      SECTION
        3.07  Performance
        of Obligations; Servicing of Financed Student Loans.
        (a)  The
        Issuer will not take any action and will use its best efforts not to permit
        any
        action to be taken by others that would release any Person from any of such
        Person’s material covenants or obligations under any instrument or agreement
        included in the Indenture Trust Estate or that would result in the amendment,
        hypothecation, subordination, termination or discharge of, or impair the
        validity or effectiveness of, any such instrument or agreement, except as
        expressly provided in this Indenture or the other Basic Documents.

       

      (b)  Although
        the Issuer will contract with other Persons to assist it in performing its
        duties under this Indenture, any performance of such duties by a Person
        identified to the Indenture Trustee in an Officers’ Certificate of the Issuer
        shall be deemed to be action taken by the Issuer. Initially, the Issuer has
        contracted with the Servicers and the Administrator to assist the Issuer
        in
        performing its duties under this Indenture.

       

      (c)  The
        Issuer will enforce all of its rights under this Indenture and the Basic
        Documents, including, without limitation, enforcing the covenants and agreements
        of the Depositor in the Deposit and Sale Agreement (including covenants to
        the
        effect that the Depositor will enforce covenants against the Sellers under
        the
        Student Loan Purchase Agreements), and will punctually perform and observe
        all
        of its obligations and agreements contained in this Indenture, the other
        Basic
        Documents and in the instruments and agreements included in the Indenture
        Trust
        Estate, including filing or causing to be filed all UCC financing statements
        and
        continuation statements required to be filed by the terms of this Indenture
        in
        accordance with and within the time periods provided for herein and therein.
        Except
        as
        otherwise expressly provided therein, the Issuer shall not waive, amend,
        modify,
        supplement or terminate any Basic Document or any provision thereof without
        the
        consent of the Indenture Trustee and the Interested Noteholders holding a
        majority of the Outstanding Amount of the related Classes of Notes.

       

      (d)  If
        the
        Issuer shall have knowledge of the occurrence of a Servicer Default, an
        Administrator Default or a Back-up Administrator Default, the Issuer shall
        promptly notify the Indenture Trustee, the Liquidity Provider and the Rating
        Agencies thereof, and shall specify in such notice the action, if any, the
        Issuer is taking with respect to such default. If a Servicer Default shall
        arise
        from the failure of a Servicer to perform any of its duties or obligations
        under
        the Servicing Agreement, or an Administrator Default shall arise from the
        failure of the Administrator to perform any of its duties or obligations
        under
        the Administration Agreement, or a Back-up Administrator Default shall arise
        from the failure of the Back-up Administrator to perform any of its duties
        or
        obligations under the Back-up Administration Agreement, as the case may be,
        with
        respect to the Financed Student Loans, the Issuer shall take all reasonable
        steps available to it to enforce its rights under the Basic Documents in
        respect
        of such failure.

       

      (e)  Upon
        any
        partial or complete termination of a Servicer’s rights and powers pursuant to a
        Servicing Agreement, or any termination of the Administrator’s rights and powers
        pursuant to the Administration Agreement, or any termination of the Back-up
        Administrator’s rights and powers pursuant to the Back-up Administration
        Agreement, as the case may be, the Issuer shall promptly notify the Indenture
        Trustee, the Liquidity Provider and the Rating Agencies. As soon as a successor
        Servicer, a successor Administrator, or a successor Back-up Administrator
        is
        appointed, the Issuer shall notify the Indenture Trustee, the Liquidity Provider
        and the Rating Agencies of such appointment, specifying in such notice the
        name
        and address of such Successor Servicer, such Successor Administrator or such
        Back-up Administrator.

       

      (f)  Without
        derogating from the absolute nature of the assignment granted to the Indenture
        Trustee under this Indenture or the rights of the Indenture Trustee hereunder,
        the Issuer agrees that it will not, without the prior written consent of
        the
        Indenture Trustee and the Interested Noteholders holding a majority of the
        Outstanding Amount of the Related Classes of Notes, amend, modify, waive,
        supplement, terminate or surrender, or agree to any amendment, modification,
        supplement, termination, waiver or surrender of, the terms of any Collateral
        or
        the Basic Documents, except to the extent otherwise provided therein, or
        waive
        timely performance or observance by a Servicer, the Administrator, the Back-up
        Administrator, the Depositor, the Issuer or the Owner Trustee under the Basic
        Documents; provided,
        however,
        that no
        such amendment shall (i) increase or reduce in any manner the amount of,
        or
        accelerate or delay the timing of, collections of payments with respect to
        Student Loans or distributions that shall be required to be made for the
        benefit
        of the holders of Notes or the Liquidity Provider, (ii) amend the aforesaid
        percentage of the Outstanding Amount of the related Class or Classes of Notes,
        which are required to consent to any such amendment, without the consent
        of all
        outstanding holders of all Classes of Notes affected by such amendment and
        the
        Liquidity Provider. If any such amendment, modification, supplement or waiver
        shall be so consented to by the Indenture Trustee and such holders of the
        Notes
        and the Liquidity Provider, the Issuer agrees, promptly following a request
        by
        the Indenture Trustee to do so, to execute and deliver, in its own name and
        at
        its own expense, such agreements, instruments, consents and other documents
        as
        the Indenture Trustee may deem necessary or appropriate in the
        circumstances.

       

      SECTION
        3.08  Negative
        Covenants.
        So long
        as any Notes are Outstanding or amounts are owed to the Liquidity Provider
        under
        the Liquidity Note Agreement, the Issuer shall not:

       

      (i)  except
        as
        expressly permitted by this Indenture or any other Basic Document, sell,
        transfer, exchange or otherwise dispose of any of the properties or assets
        of
        the Issuer, including those included in the Indenture Trust Estate, unless
        directed to do so by the Indenture Trustee pursuant to the terms
        hereof;

       

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

       

      (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
        or
        discharged, or permit any Person to be released from any covenants or
        obligations with respect to the Notes under this Indenture or under the
        Liquidity Note Agreement except as may be expressly permitted hereby or thereby,
        (B) 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 Indenture Trust Estate or any part
        thereof or any interest therein or the proceeds thereof (other than tax liens
        and other liens that arise by operation of law, in each case arising solely
        as a
        result of an action or omission of the related Obligor, and other than as
        expressly permitted by the Basic Documents) or (C) permit the lien of this
        Indenture not to constitute a valid first priority (other than with respect
        to
        any such tax or other lien) security interest in the Indenture Trust
        Estate.

       

      SECTION
        3.09  Annual
        Statement as to Compliance.
        The
        Issuer will deliver to the Indenture Trustee and to the Liquidity Provider,
        on
        or before March 15 of each year, commencing March 15, 2007, an Officers’
Certificate of the Issuer stating that:

       

      (i)  a
        review
        of the activities of the Issuer during the previous calendar year and of
        performance under this Indenture has been made under such Authorized Officers’
supervision; and

       

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

       

      SECTION
        3.10  Issuer
        May Consolidate, etc., Only on Certain Terms.
        (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 and shall 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 each Class of Notes and amounts owed to the
        Liquidity Provider, and the performance or observance of every agreement
        and
        covenant of this Indenture and the other Basic Documents on the part of the
        Issuer to be performed or observed, all as provided herein and
        therein;

       

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

       

      (iii)  the
        Rating Agency Condition shall have been satisfied with respect to such
        transaction;

       

      (iv)  the
        Issuer shall have received an Opinion of Counsel (and shall have delivered
        copies thereof to the Indenture Trustee) to the effect that such transaction
        will not have any material adverse Federal tax consequence to the Issuer,
        any
        holder of the Notes, the Liquidity Provider or any holder of the
        Certificates;

       

      (v)  any
        action as 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 Officers’ Certificate of
        the Issuer 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.

       

      (b)  The
        Issuer shall not convey or transfer all or substantially all its properties
        or
        assets, including those included in the Indenture 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 each Class of Notes and amounts owed to the
        Liquidity Provider and the performance or observance of every agreement and
        covenant of this Indenture and the other Basic Documents on the part of the
        Issuer to be performed or observed, all as provided herein and therein, (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 and the Liquidity Provider and (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, the Notes and the Liquidity
        Note Agreement;

       

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

       

      (iii)  the
        Rating Agency Condition shall have been satisfied with respect to such
        transaction;

       

      (iv)  the
        Issuer shall have received an Opinion of Counsel (and shall have delivered
        copies thereof to the Indenture Trustee) to the effect that such transaction
        will not have any material adverse Federal tax consequence to the Issuer,
        any
        holder of the Notes, the Liquidity Provider or any holder of the
        Certificates;

       

      (v)  any
        action as 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 Officers’ Certificate of
        the Issuer 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.

       

      SECTION
        3.11  Successor
        or Transferee.
        (a)  Upon
        any consolidation or merger of the Issuer in accordance with Section 3.10(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 3.10(b), The National Collegiate Student Loan Trust 2006-3 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 by the Issuer of written notice to the Indenture Trustee
        stating that The National Collegiate Student Loan Trust 2006-3 is to be so
        released.

       

      SECTION
        3.12  No
        Other Business.
        The
        Issuer shall not engage in any business other than financing, purchasing,
        owning, selling and servicing the Financed Student Loans in the manner
        contemplated by this Indenture and the other Basic Documents and activities
        incidental thereto.

       

      SECTION
        3.13  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
        3.14  Disposing
        of Financed Student Loans.
        Other
        than pursuant to Article V, Financed Student Loans may only be sold,
        transferred, exchanged or otherwise disposed of by the Indenture Trustee
        free
        from the lien of this Indenture (i) for transfer to a Guarantee Agency pursuant
        to the terms of the applicable Guarantee Agreement; (ii) to a Seller or the
        Depositor in accordance with the applicable Student Loan Purchase Agreement
        or
        the Deposit and Sale Agreement; or (iii) to a Servicer in and, in each case,
        if
        the Indenture Trustee is provided with the following:

       

      (a)  an
        Issuer
        Order stating the sale price and directing that Financed Student Loans be
        sold,
        transferred or otherwise disposed of and delivered to a transferee whose
        name
        shall be specified; and

       

      (b)  a
        certificate signed by an Authorized Officer of the Issuer to the effect that
        the
        disposition price is equal to or in excess of the amount required by the
        applicable Guarantee Agreement in the case of clause (i), by the applicable
        Student Loan Purchase Agreement in the case of clause (ii), or by the applicable
        Servicing Agreement in the case of clause (iii).

       

      Subject
        to the provisions of this Indenture and except for sales of Financed Student
        Loans pursuant to this Section 3.14, the Indenture Trustee shall release
        property from the lien of this Indenture only upon receipt of an Issuer Order,
        an Opinion of Counsel and independent certificates in accordance with TIA
        Sections 314(c) and 314(d)(1) or an Opinion of Counsel in lieu of such
        independent certificates to the effect that the TIA does not require any
        such
        independent certificates.

       

      Each
        Noteholder, by the acceptance of a Note, acknowledges that from time to time
        the
        Indenture Trustee shall release the lien of this Indenture on any Financed
        Student Loan to be sold pursuant to this Section 3.14, and each Noteholder,
        by
        the acceptance of a Note, consents to any such release.

       

      The
        Indenture Trustee, as a third-party beneficiary under the Student Loan Purchase
        Agreements entered into by the Depositor, who has assigned its entire right,
        title and interest in such Student Loan Purchase Agreements to the Issuer
        pursuant to the terms of the Deposit and Sale Agreement, shall have the right
        to
        request the repurchase of loans by the applicable Seller or the Depositor,
        as
        the case may be, together with any indemnity payments due thereunder upon
        the
        conditions and subject to the provisions contained in the Student Loan Purchase
        Agreements. The Indenture Trustee shall make such a request to the applicable
        Seller under the related Student Loan Purchase Agreement or the Depositor
        under
        the Deposit and Sale Agreement, as the case may be, to repurchase and, as
        the
        case may be, pay any indemnity amounts due with respect to certain specific
        loans pursuant to the Student Loan Purchase Agreements or the Deposit and
        Sale
        Agreement, as applicable, if (i) a Responsible Officer of the Indenture Trustee
        has actual knowledge that the conditions precedent to such a repurchase or
        indemnity obligation with respect to such loans have been satisfied; (ii)
        the
        Indenture Trustee has notified the Issuer in writing that such conditions
        have
        been satisfied; and (iii) the Issuer has not exercised its right to request
        the
        repurchase or indemnity of the applicable loans by the applicable Seller
        or the
        Depositor, as the case may be, within 10 days after receiving written notice
        from the Indenture Trustee.

       

      SECTION
        3.15  Guarantees,
        Loans, Advances and Other Liabilities.
        Except
        as contemplated by this Indenture or the other 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
        3.16  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
        3.17  Restricted
        Payments.
        The
        Issuer shall not, directly or indirectly, (i) pay any dividend or make any
        distribution (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 or to the Depositor, a Servicer,
        the Administrator or the Back-up Administrator, (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, distributions to such persons as
        contemplated by, and to the extent funds are available for such purpose under,
        this Indenture and the other Basic Documents. The Issuer will not, directly
        or
        indirectly, make payments to or distributions from the Collection Account
        except
        in accordance with this Indenture and the other Basic Documents.

       

      SECTION
        3.18  Notice
        of Events of Default.
        The
        Issuer shall give the Indenture Trustee, the Liquidity Provider and the Rating
        Agencies prompt written notice of each Event of Default hereunder and each
        default on the part of a Servicer of its obligations under a Servicing Agreement
        or the Administrator of its obligations under the Administration Agreement.
        In
        addition, the Issuer shall deliver to the Indenture Trustee, within five
        days
        after the occurrence thereof, written notice in the form of an Officers’
Certificate of the Issuer of any event which with the giving of notice and
        the
        lapse of time would become an Event of Default under Section 5.01(iii), its
        status and what action the Issuer is taking or proposes to take with respect
        thereto.

       

      SECTION
        3.19  Further
        Instruments and Acts.
        Upon
        request of the Indenture Trustee (acting at the direction of the Interested
        Noteholders representing not less than a majority of the Outstanding Amount
        of
        the applicable Classes of Notes and the Liquidity Note), 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
        3.20  Additional
        Covenants.
        The
        Issuer covenants that it will acquire or cause to be acquired Student Loans
        as
        described herein. The Noteholders shall not in any circumstances be deemed
        to be
        the owner or holder of the Financed Student Loans.

       

      The
        Issuer, or its designated agent, shall be responsible for each of the following
        actions:

       

      (a)  The
        Issuer, or its designated agent, shall cause the benefits of the Guarantee
        Agreements to flow to the Indenture Trustee.

       

      (b)  The
        Indenture Trustee shall have no obligation to administer, service or collect
        the
        loans in the Indenture Trust Estate or to maintain or monitor the
        administration, servicing or collection of such loans.

       

      (c)  The
        Issuer shall comply with all United States statutes, rules and regulations
        which
        apply to the Student Loan Programs, the Program Manual and the Financed Student
        Loans.

       

      (d)  The
        Issuer shall cause to be diligently enforced and taken all reasonable steps,
        actions and proceedings necessary for the enforcement of all terms, covenants
        and conditions of all Financed Student Loans made and agreements in connection
        therewith, including the prompt payment of all principal and interest payments
        and all other amounts due the Issuer thereunder. The Issuer shall not permit
        the
        release of the obligations of any borrower under any Financed Student Loan
        and
        shall at all times, to the extent permitted by law, cause to be defended,
        enforced, preserved and protected the rights and privileges of the Issuer,
        the
        Indenture Trustee and of the Noteholders under or with respect to each Financed
        Student Loan and agreement in connection therewith.

       

      (e)  The
        Issuer shall take all appropriate action to ensure that at the time each
        Student
        Loan becomes a part of the Indenture Trust Estate it shall be free and clear
        from all liens.

       

      (f)  The
        Issuer shall diligently enforce, and take all steps, actions and proceedings
        reasonably necessary to protect its rights with respect to each Financed
        Student
        Loan, and to maintain any guarantee (including the Guarantee issued by TERI)
        on
        and to enforce all terms, covenants and conditions of Financed Student Loans,
        including its rights and remedies under the Deposit and Sale Agreement and
        the
        TERI Pledge Fund.

       

      The
        Trustee shall not be deemed to be the designated agent for the purposes of
        this
        Section unless it has agreed in writing to be such agent.

       

      SECTION
        3.21  Covenant
        Regarding Financed Student Loans.
        The
        Issuer hereby covenants that all Student Loans to be acquired hereunder will
        meet the following:

       

      (a)  Each
        Student Loan is evidenced by an executed promissory note, which note is a
        valid
        and binding obligation of the Obligor, enforceable by or on behalf of the
        holder
        thereof in accordance with its terms, subject to bankruptcy, insolvency and
        other laws relating to or affecting creditors’ rights.

       

      (b)  The
        amount of the unpaid principal balance of each Student Loan is due and owing,
        and no counterclaim, offset, defense or right to rescission exists with respect
        to any such Student Loan which can be asserted and maintained or which, with
        notice, lapse of time, or the occurrence or failure to occur of any act or
        event, could be asserted and maintained by the Obligor against the Issuer
        as
        assignee thereof. The Issuer shall take all reasonable actions to assure
        that no
        maker of a Student Loan has or may acquire a defense to the payment
        thereof.

       

      (c)  No
        Student Loan has a payment that is more than 90 days overdue other than such
        Student Loans that, in the aggregate, do not exceed 1.00% of the then aggregate
        outstanding principal amount of the Student Loans.

       

      (d)  The
        Issuer has full right, title and interest in each Student Loan free and clear
        of
        all liens, pledges or encumbrances whatsoever.

       

      (e)  Each
        Student Loan was made in compliance with all applicable state and federal
        laws,
        rules and regulations, including, without limitation, all applicable
        nondiscrimination, truth-in-lending, consumer credit and usury
        laws.

       

      (f)  All
        loan
        documentation shall be delivered to the applicable Servicer (as custodian
        for
        the Indenture Trustee) prior to payment of the purchase price of such Student
        Loan.

       

      (g)  Each
        Student Loan is accruing interest (whether or not such interest is being
        paid
        currently by the borrower or is being capitalized), except as otherwise
        expressly permitted by this Indenture.

       

      (h)  Each
        Student Loan was originated in conformity with the “loan acceptance criteria”
(including, without limitation, any general policies, eligible borrower
        criteria, creditworthiness criteria and “good credit” criteria) and the “loan
        program terms” (including, without limitation, the loan amount, the interest
        rate and the guaranty fee) (or any similar criteria or terms, however so
        designated, under the applicable Program Manual) contained in the Program
        Manual
        and otherwise, in substantial conformity with the Program Manual.

       

      (i)  Each
        Student Loan is guaranteed by a Guarantee Agency.

       

      SECTION
        3.22  Additional
        Representations of the Issuer.
        The
        Issuer hereby makes the following representations and warranties to the
        Indenture Trustee, on behalf of the Noteholders and the Liquidity
        Provider:

       

      (a)  Valid
        and Continuing Security Interest.
        This
        Indenture creates a valid and continuing security interest (as defined in
        the
        applicable Uniform Commercial Code (“UCC”) in effect in the State of Delaware)
        in the Financed Student Loans and all other assets constituting part of the
        Indenture Trust Estate in favor of the Indenture Trustee, which security
        interest is prior to all other liens, charges, security interests, mortgages
        or
        other encumbrances, and is enforceable as such as against creditors of and
        purchasers from the Issuer.

       

      (b)  Accounts.
        The
        Financed Student Loans constitute “accounts” or “payment intangibles” within the
        meaning of the applicable UCC.

       

      (c)  Good
        and Marketable Title.
        The
        Issuer owns and has good and marketable title to the Financed Student Loans
        and
        all other assets constituting part of the Indenture Trust Estate free and
        clear
        of any lien, charge, security interest, mortgage or other encumbrance, claim
        or
        encumbrance of any Person, other that those granted pursuant to this
        Indenture.

       

      (d)  Perfection
        by Filing.
        The
        Issuer has caused or will have caused, within ten days of the Closing Date,
        the
        filing of all appropriate financing statements in the proper filing office
        in
        the appropriate jurisdictions under applicable law in order to perfect the
        security interest in the Financed Student Loans and all other assets of the
        Indenture Trust Estate granted to the Trustee hereunder.

       

      (e)  Perfection
        by Possession.
        The
        Issuer has given the Indenture Trustee a copy of a written acknowledgment
        from
        the applicable custodian that the custodian is holding executed copies of
        the
        promissory notes and master promissory notes that constitute or evidence
        the
        Financed Student Loans, and that such custodian is holding such notes solely
        on
        behalf and for the benefit of the Indenture Trustee.

       

      (f)  Priority.
        Other
        than the security interest granted to the Indenture Trustee pursuant to this
        Indenture, the Issuer has not pledged, assigned, sold, granted a security
        interest in, or otherwise conveyed any of the Financed Student Loans or any
        other portion of the Indenture Trust Estate. 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 Financed Student Loans or
        any
        other portion of the Indenture Trust Estate other than any financing statement
        relating to the security interest granted to the Indenture Trustee hereunder
        or
        that has been terminated. The Issuer is not aware of any judgment or tax
        lien
        filings against the Issuer.

       

      (g)  Valid
        Business Reasons; No Fraudulent Transfers.
        The
        transactions contemplated by this Indenture are in the ordinary course of
        the
        Issuer’s business and the Issuer has valid business reasons for granting the
        Indenture Trust Estate pursuant to this Indenture. At the time of each such
        grant: (i) the Issuer granted the Indenture Trust Estate to the Indenture
        Trustee without any intent to hinder, delay, or defraud any current or future
        creditor of the Issuer; (ii) the Issuer was not insolvent and did not become
        insolvent as a result of any such grant; (iii) the Issuer was not engaged
        and
        was not about to engage in any business or transaction for which any property
        remaining with such entity was an unreasonably small capital or for which
        the
        remaining assets of such entity are unreasonably small in relation to the
        business of such entity or the transaction; (iv) the Issuer did not intend
        to
        incur, and did not believe or should not have reasonably believed, that it
        would
        incur, debts beyond its ability to pay as they become due; and (v) the
        consideration paid received by the Issuer for the grant of the Indenture
        Trust
        Estate was reasonably equivalent to the value of the related grant.

       

      SECTION
        3.23  Issuer
        Separateness Covenants.
        So long
        as any of the Notes are Outstanding or amounts are owed to the Liquidity
        Provider under the Liquidity Note Agreement:

       

      (a)  The
        Issuer shall not engage in any business or activity other than in connection
        with the activities contemplated hereby and in the Basic Documents, and in
        connection with the issuance of Notes.

       

      (b)  The
        funds
        and other assets of the Issuer shall not be commingled with those of any
        other
        individual, corporation, estate, partnership, joint venture, association,
        joint
        stock company, trust, unincorporated organization, or government or any agency
        or political subdivision thereof.

       

      (c)  The
        Issuer shall not be, become or hold itself out as being liable for the debts
        of
        any other party.

       

      (d)  The
        Issuer shall not form, or cause to be formed, any subsidiaries.

       

      (e)  The
        Issuer shall act solely in its own name and through its duly authorized officers
        or agents in the conduct of its business, and shall conduct its business
        so as
        not to mislead others as to the identity of the entity with which they are
        concerned.

       

      (f)  The
        Issuer shall maintain its records and books of account and shall not commingle
        its records and books of account with the records and books of account of
        any
        other Person. The books of the Issuer may be kept (subject to any provision
        contained in the statutes) inside or outside the State of Delaware at such
        place
        or places as may be designated from time to time by the board of trustees
        or in
        the bylaws of the Issuer.

       

      (g)  All
        actions of the Issuer shall be taken by a duly authorized officer or agent
        of
        the Issuer.

       

      (h)  The
        Issuer shall not amend, alter, change or repeal any provision contained in
        this
        Section without (i) the prior written consent of the Indenture Trustee, and
        (ii) satisfying the Rating Agency Condition.

       

      (i)  The
        Issuer shall not amend its organizational documents or change its jurisdiction
        of formation without first satisfying the Rating Agency Condition.

       

      (j)  All
        audited financial statements of the Issuer that are consolidated with those
        of
        any Affiliate thereof will contain detailed notes clearly stating that
        (i) all of the Issuer’s assets are owned by the Issuer, and (ii) the
        Issuer is a separate entity with creditors who have received ownership and/or
        security interests in the Issuer’s assets.

       

      (k)  The
        Issuer will strictly observe legal formalities in its dealings with any of
        its
        Affiliates, and funds or other assets of the Issuer will not be commingled
        with
        those of any of its Affiliates. The Issuer shall not maintain joint bank
        accounts or other depository accounts to which any of its Affiliates has
        independent access. None of the Issuer’s funds will at any time be pooled with
        the funds of any of its Affiliates.

       

      (l)  The
        Issuer will maintain an arm’s length relationship with each Seller (and any
        Affiliate thereof), the Depositor (and any Affiliate thereof), and any of
        the
        Issuer’s Affiliates. Any Person that renders or otherwise furnishes services to
        the Issuer will be compensated by the Issuer at market rates for such services
        it renders or otherwise furnishes to the Issuer except as otherwise provided
        in
        this Indenture. The Issuer will not hold itself out to be responsible for
        the
        debts of the Seller, or the Depositor, the parent or the decisions or actions
        respecting the daily business and affairs of the Seller, the Depositor or
        the
        parent.

       

      (m)  The
        Issuer shall not sell, transfer, exchange or otherwise dispose of any portion
        of
        the Indenture Trust Estate except as expressly permitted by this
        Indenture.

       

      (n)  The
        Issuer shall not claim any credit on, or make any deduction from, the principal
        amount of any of the Notes by reason of the payment of any taxes levied or
        assessed upon any portion of the Indenture Trust Estate.

       

      (o)  The
        Issuer shall not permit the validity or effectiveness of this Indenture or
        any
        grant hereunder to be impaired, or permit the lien of this Indenture to be
        amended, hypothecated, subordinated, terminated or discharged, or permit
        any
        Person to be released from any covenants or obligations under this Indenture,
        except as may be expressly permitted hereby.

       

      SECTION
        3.24  Reports
        by Issuer.
        The
        Issuer will:

       

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

       

      (b)  File
        with
        the Indenture Trustee and the SEC, in accordance with rules and regulations
        prescribed from time to time by the SEC, such additional information, documents
        and reports, if any, 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

       

      (c)  Transmit
        by mail to the Noteholders, within 30 days after the filing thereof with
        the Indenture Trustee, in the manner and to the extent provided in TIA
        Section 313(c), such summaries of any information, documents and reports
        required to be filed by the Issuer, if any, pursuant to Section 3.24(a) and
        (b) as may be required by rules and regulations prescribed from time to time
        by
        the SEC.

       

      The
        Indenture Trustee may conclusively rely and accept such reports from the
        Issuer
        as fulfilling the requirements of this Section 3.24, with no further duty
        to examine such reports or to determine whether such reports comply with
        the
        prescribed timing, rules and regulations of the SEC. Delivery of such reports
        to
        the Indenture Trustee is for informational purposes only and the Indenture
        Trustee’s receipt of such shall not constitute constructive notice of any
        information contained therein or determinable from information contained
        therein, including the Issuer’s compliance with any of its covenants hereunder
        (as to which the Indenture Trustee is entitled to rely on an Officers’
Certificate).

       

      ARTICLE
        IV

       

      Satisfaction
        and Discharge

       

      SECTION
        4.01  Satisfaction
        and Discharge of Indenture.
        This
        Indenture shall cease to be of further effect with respect to the Notes and
        the
        Liquidity Note except as to (i) rights of registration of transfer and exchange,
        (ii) substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights
        of
        holders of the Notes to receive payments of principal thereof and interest
        thereon, (iv) Sections 3.03, 3.04, 3.05, 3.08, 3.10, 3.12 and 3.13, (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 4.02) and (vi) the rights of holders
        of the
        Notes, 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)  a
        period
        of 367 days has expired after all 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 2.05 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) and the Liquidity Note have been delivered
        to the Indenture Trustee for cancellation;

       

      (B)  a
        period
        of 367 days has expired after the later of (i) the date on which no Notes
        and
        the Liquidity Note are outstanding or (ii) the date on which the Issuer has
        paid
        or caused to be paid all other sums otherwise payable hereunder by the Issuer;
        and

       

      (C)  the
        Issuer has delivered to the Indenture Trustee an Officers’ Certificate of the
        Issuer and an Opinion of Counsel, each meeting the applicable requirements
        of
        Section 11.01 and, subject to Section 11.02, each stating that all conditions
        precedent herein provided for relating to the satisfaction and discharge
        of this
        Indenture have been complied with.

       

      SECTION
        4.02  Application
        of Trust Money.
        All
        moneys deposited with the Indenture Trustee pursuant to Section 4.01 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, as the Indenture Trustee may determine, to the holders of the
        particular Notes for the payment of which such moneys have been deposited
        with
        the Indenture Trustee, of all sums due and to become due thereon for principal
        of and interest on each Class of Notes; but such moneys need not be segregated
        from other funds except to the extent required herein or required by
        law.

       

      SECTION
        4.03  Repayment
        of Moneys Held by Paying Agent.
        In
        connection with the satisfaction and discharge of this Indenture with respect
        to
        the Notes, all moneys then held by any Paying Agent other than the Indenture
        Trustee under the provisions of this Indenture with respect to such Notes
        shall,
        upon demand of the Issuer, be paid to the Indenture Trustee to be held and
        applied according to Section 3.03 and thereupon such Paying Agent shall be
        released from all further liability with respect to such moneys.

       

      ARTICLE
        V

       

      Remedies

       

      SECTION
        5.01  Events
        of Default.
“Event
        of Default”, wherever used herein, means any one of the following events
        (whatever the reason for such Event of Default and whether it shall be voluntary
        or involuntary or be effected by operation of law or pursuant to any judgment,
        decree or order of any court or any order, rule or regulation of any
        administrative or governmental body):

       

      (i)  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 three (3) Business
        Days
        (provided,
        however,
        so long
        as (x) any of the Class A Notes are outstanding, each holder of any Class
        B
        Note, Class C Note or Class D Note or the Note Owner of any such Class B
        Note,
        Class C Note or Class D Note by such holder’s acceptance of such Class B Note,
        Class C Note or Class D Note or beneficial interest therein, as the case
        may be,
        shall be deemed to have consented to the delay in payment of interest on
        such
        Class B Note, Class C Note or Class D Note and to have waived its right to
        institute suit for enforcement of any such payment, (y) any of the Class
        B Notes
        are outstanding, each holder of any Class C Note or Class D Note or the Note
        Owner of any such Class C Note or Class D Note by such holder’s acceptance of
        such Class C Note or Class D Note or beneficial interest therein, as the
        case
        may be, shall be deemed to have consented to the delay in payment of interest
        on
        such Class C Note or Class D Note and to have waived its right to institute
        suit
        for enforcement of any such payment or
        (z) any of the Class C Notes are outstanding, each holder of any Class D
        Note or
        the Note Owner of any such Class D Note by such holder’s acceptance of such
        Class D Note or beneficial interest therein, as the case may be, shall be
        deemed
        to have consented to the delay in payment of interest on such Class D Note
        and
        to have waived its right to institute suit for enforcement of any such
        payment);
        or

       

      (ii)  default
        in the payment of the principal of any Note (other than the Class A-IO Notes)
        (x) when the same becomes due and payable (but only to the extent there exists
        sufficient Available Funds, therefor), or (y) on the Final Maturity Date
        with
        respect thereto; or

       

      (iii)  default
        in the observance or performance of any covenant or agreement of the Issuer
        made
        in this Indenture or any other Basic Document (other than a covenant or
        agreement, a default in the observance or performance of which is elsewhere
        in
        this Section specifically dealt with), or any representation or warranty
        of the
        Issuer made in this Indenture or any other Basic Document 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, and such default shall continue or not be cured, or the
        circumstance or condition in respect of which such misrepresentation 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 Interested Noteholders, representing not less than 25% of the Outstanding
        Amount of the applicable Classes of Notes; 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)  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 Indenture
        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 Indenture 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)  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,
        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 Indenture 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 action by the
        Issuer
        in furtherance of any of the foregoing.

       

      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 at the written direction of the Interested
        Noteholders representing not less than a majority of the Outstanding Amount
        of
        the applicable Classes of Notes
        and the
        Liquidity Note, shall declare all the Notes to be immediately due and payable,
        by a notice in writing to the Issuer (and to the Indenture Trustee if given
        by
        the holders of the Notes), and upon any such declaration the unpaid principal
        amount of the Notes and the Liquidity Note Balance, 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 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 Interested
        Noteholders representing not less than a majority of the Outstanding Amount
        of
        the applicable Classes of Notes and the Liquidity Note, by written notice
        to the
        Issuer and the Indenture Trustee, may 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)  (1)
        all
        payments of principal of and interest on all Notes and (2) the Liquidity
        Note
        Balance, and all other amounts that would then be due hereunder or upon such
        Notes and the Liquidity Note if the Event of Default giving rise to such
        acceleration had not occurred;

       

      (B)  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 (A) the principal of the
        Notes
        and (B) the Liquidity Note Balance that have 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)
        The
        Issuer covenants that if (i) default is made in the payment of any interest
        on
        any Note when the same becomes due and payable, and such default continues
        for a
        period of three Business Days, or (ii) default is made in the payment of
        the
        principal on the related Final Maturity Date of a Class of Notes when the
        same
        becomes due and payable in accordance with Section 2.07(b), the Issuer will,
        upon demand of the Indenture Trustee, pay to the Indenture Trustee, for the
        benefit of the holders of the Notes, the whole amount then due and payable
        on
        such Notes for principal and interest, with interest upon the overdue principal,
        and, to the extent payment at such rate of interest shall be legally
        enforceable, upon overdue installments of interest at the rate specified
        in
        Section 2.07 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, may,
        or
        shall at the written direction of the Interested Noteholders, representing
        not
        less than a majority of the Outstanding Amount of the applicable Classes
        of
        Notes, institute a Proceeding for the collection of the sums so due and unpaid,
        and prosecute such Proceeding to judgment or final decree, and enforce the
        same
        against the Issuer or other obligor upon such Notes, and collect in the manner
        provided by law out of the property of the Issuer or other obligor upon such
        Notes wherever situated, the moneys adjudged or decreed to be
        payable.

       

      (c)  If
        an
        Event of Default occurs and is continuing, the Indenture Trustee may, or
        shall
        at the written direction of the Interested Noteholders, representing not
        less
        than a majority of the Outstanding Amount of the applicable Classes of Notes,
        as
        more particularly provided in Section 5.04, proceed to protect and enforce
        its
        rights, the rights of the holders of the Notes and the Liquidity Provider,
        as
        applicable, 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 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 the Liquidity Note, or any Person having or claiming an ownership
        interest in the Indenture 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 the Liquidity Note,
        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, may, or shall at the written direction of the
        Interested Noteholders representing not less than a majority of the Outstanding
        Amount of the applicable Classes of Notes and the Liquidity Note, 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 of and interest
        on
        each Class of Notes owing and unpaid in respect of the Notes and amounts
        owing
        and unpaid in respect of the Liquidity Note 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 or bad faith)
        and the holders of the Notes allowed in such Proceedings;

       

      (ii)  unless
        prohibited by applicable law and regulations, to vote on behalf of the holders
        of the 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 moneys or other property payable or deliverable on
        any
        such claims and to distribute all amounts received with respect to the claims
        of
        the holders of the Notes, the Liquidity Provider and of the Indenture Trustee
        on
        their behalf;

       

      (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
        the Notes or the Liquidity Provider allowed in any judicial proceedings relative
        to the Issuer, its creditors and its property; and

       

      (v)  to
        take
        any other action with respect to such claims including participating as a
        member
        of any official committee of creditor’s appointed in the matters as it deems
        necessary or advisable;

       

      and
        any
        trustee, receiver, liquidator, custodian or other similar official in any
        such
        Proceeding is hereby authorized by each of such holders of the Notes and
        the
        Liquidity Provider 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 holders of the Notes and the Liquidity Provider 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 or bad faith.

       

      (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 holder of the
        Notes or the Liquidity Provider any plan of reorganization, arrangement,
        adjustment or composition affecting the Notes or the Liquidity Provider or
        the
        rights of any holder of the Notes or the Liquidity Provider thereof or to
        authorize the Indenture Trustee to vote in respect of the claim of any holder
        of
        the Notes or the Liquidity Provider 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 the Liquidity Provider and it shall not be
        necessary to make any holder of the Notes 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
        may, or shall, subject to Section 5.11, at the written direction of the
        Interested Noteholders representing not less than a majority of the Outstanding
        Amount of the applicable Classes of Notes and the Liquidity Note (or such
        different percentage as set forth below), 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 the Liquidity
        Note
        Agreement or this Indenture with respect thereto, whether by declaration
        or
        otherwise, enforce any judgment obtained, and collect from the Issuer and
        any
        other obligor upon such Notes or under the Liquidity Note Agreement moneys
        adjudged due;

       

      (ii)  institute
        Proceedings from time to time for the complete or partial foreclosure of
        this
        Indenture with respect to the Indenture Trust Estate securing the Notes and
        amounts due the Liquidity Provider under the Liquidity Note
        Agreement;

       

      (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 and the Liquidity Provider; and

       

      (iv)  sell
        the
        Indenture Trust Estate securing the Notes and amounts due the Liquidity Provider
        under the Liquidity Note Agreement 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 Indenture Trust
        Estate securing the Notes and amounts due the Liquidity Provider under the
        Liquidity Note Agreement following an Event of Default, other than an Event
        of
        Default described in Section 5.01(i) or (ii), unless (x) 100% of the Noteholders
        and the Liquidity Provider consent to such sale, (y) the proceeds of such
        sale
        are sufficient to pay in full the principal of and the accrued interest on
        the
        Notes and amounts owed to the Liquidity Provider under the Liquidity Note
        Agreement or (z) the Indenture Trustee determines that the collections on
        the
        Financed Student Loans would not be sufficient on an ongoing basis to make
        all
        payments on the Notes and amounts owed to the Liquidity Provider under the
        Liquidity Note Agreement as such payments would have become due if such
        obligations had not been declared due and payable, and the Indenture Trustee
        obtains the consent of the holders of Notes, representing not less than a
        66.67%
        of the Outstanding Amount of the Notes and the Liquidity Provider. In
        determining the sufficiency of the collections on such loans, 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
        sufficiency of the Indenture Trust Estate for such purpose. 

       

      (b)  If
        the
        Indenture Trustee collects any money or property under this Article V following
        the occurrence and during the continuation of an Event of Default with respect
        to Sections 5.01(i) or 5.01(ii) above or following the acceleration of the
        Notes
        pursuant to Section 5.02 upon an Event of Default with respect to Sections
        5.01(i) or 5.01(ii) above, it shall pay out the money or property in the
        following order:

       

      FIRST: pro rata
        based
        upon amounts owed (i) to the Owner Trustee for amounts due under Article
        X of
        the Trust Agreement, to the Indenture Trustee for amounts due under Section
        6.07, to the Irish Paying Agent for amounts due under the Irish Paying Agent
        Agreement, to the Back-up Administrator for amounts due under the Back-up
        Administration Agreement, not to exceed $200,000 per annum in the aggregate,
        (ii) to the Servicers and the Administrator, the unpaid fees and expenses
        owed
        by the Issuer to such parties, and (iii) to the Liquidity Provider, for unpaid
        fees and expenses due under the Liquidity Note Agreement;

       

      SECOND:
        pro rata
        (i) to
        the holders of the Class A Notes for amounts due and unpaid on the Class
        A Notes
        for interest, ratably, without preference or priority of any kind, according
        to
        the amounts due and payable on the Class A Notes for interest, and (ii) to
        the
        Liquidity Provider, any interest due on the Liquidity Note Balance;

       

      THIRD:
        pro rata (i)
        to
        the holders of the Class A Notes for amounts due and unpaid on the Class
        A Notes
        for principal, ratably, without preference or priority of any kind, according
        to
        the amounts due and payable on the Class A Notes for principal, until the
        Outstanding Amount of the Class A Notes is zero, and (ii) to the Liquidity
        Provider for principal until the Liquidity Note Balance is zero;

       

      FOURTH:
        to the
        holders of the Class B Notes for amounts due and unpaid on the Class B Notes
        for
        interest (including any Noteholder’s Interest Carryover Shortfall), without
        preference or priority of any kind, according to the amounts due and payable
        on
        the Class B Notes for interest;

       

      FIFTH:
        to the
        holders of the Class B Notes for amounts due and unpaid on the Class B Notes
        for
        principal, without preference or priority of any kind, according to the amounts
        due and payable on the Class B Notes for principal, until the Outstanding
        Amount
        of the Class B Notes is zero;

       

      SIXTH:
        to the
        holders of the Class C Notes for amounts due and unpaid on the Class C Notes
        for
        interest (including any Noteholder’s Interest Carryover Shortfall), without
        preference or priority of any kind, according to the amounts due and payable
        on
        the Class C Notes for interest;

       

      SEVENTH:
        to the
        holders of the Class C Notes for amounts due and unpaid on the Class C Notes
        for
        principal, without preference or priority of any kind, according to the amounts
        due and payable on the Class C Notes for principal, until the Outstanding
        Amount
        of the Class C Notes is zero;

       

      EIGHTH:
        to the
        holders of the Class D Notes for amounts due and unpaid on the Class D Notes
        for
        interest (including any Noteholder’s Interest Carryover Shortfall), without
        preference or priority of any kind, according to the amounts due and payable
        on
        the Class D Notes for interest;

       

      NINTH:
        to the
        holders of the Class D Notes for amounts due and unpaid on the Class D Notes
        for
        principal, without preference or priority of any kind, according to the amounts
        due and payable on the Class D Notes for principal, until the Outstanding
        Amount
        of the Class D Notes is zero;

       

      TENTH:
        pro rata
        based
        upon amounts owed, (i) to the Owner Trustee, the Indenture Trustee, the Irish
        Paying Agent and the Back-up Administrator, for all amounts due and owing
        to
        such parties under the Basic Documents to the extent not paid pursuant to
        priority FIRST above, (ii) to FMC, for any unreimbursed Advances made pursuant
        to Section 8.11, (iii) to the Servicer, the Administrator and the Guarantee
        Agency, for all amounts due and owing to such parties pursuant to the Basic
        Documents, and (iv) to the Liquidity Provider for all amounts due and owing
        to
        the Liquidity Provider under the Liquidity Note Agreement to the extent not
        paid
        pursuant to priority FIRST above;

       

      ELEVENTH:
        to the
        holders of the Class A-IO Notes any Prepayment Penalties remaining unpaid
        from
        prior Distribution Dates, together with interest thereon at the Note Interest
        Rate for the Class A-IO Notes; and

       

      TWELFTH:
        to the
        Owner Trustee (on behalf of the Issuer), for distribution to the
        Certificateholders in accordance with the terms of the Trust
        Agreement.

       

      The
        Indenture Trustee may fix a record date and payment date for any payment
        to the
        holders of the Notes and the Liquidity Provider pursuant to this Section.
        At
        least 15 days before such record date, the Issuer shall mail to each holder
        of
        the Notes, the Liquidity Provider and the Indenture Trustee a notice that
        states
        the record date, the payment date and the amount to be paid.

       

      (c)  If
        the
        Indenture Trustee collects any money or property under this Article V following
        the occurrence and during the continuation of an Event of Default other than
        with respect to Sections 5.01(i) or 5.01(ii) above or following the acceleration
        of the Notes pursuant to Section 5.02 upon an Event of Default other than
        with
        respect to Sections 5.01(i) or 5.01(ii) above, it shall pay out the money
        or
        property in the following order:

       

      FIRST:
        pro rata
        based
        upon amounts owed (i) to the Owner Trustee for amounts due under Article
        X of
        the Trust Agreement, to the Indenture Trustee for amounts due under Section
        6.07, to the Irish Paying Agent for amounts due under the Irish Paying Agent
        Agreement, to the Back-up Administrator for amounts due under the Back-up
        Administration Agreement, not to exceed $200,000 per annum in the aggregate,
        (ii) to the Servicers and the Administrator, the unpaid fees and expenses
        owed
        by the Issuer to such parties, and (iii) to the Liquidity Provider, for unpaid
        fees and expenses due under the Liquidity Note Agreement;

       

      SECOND:
        pro rata
        (i) to
        the holders of the Class A Notes for amounts due and unpaid on the Class
        A Notes
        for interest, ratably, without preference or priority of any kind, according
        to
        the amounts due and payable on the Class A Notes for interest, and (ii) to
        the
        Liquidity Provider, any interest due on the Liquidity Note Balance;

       

      THIRD:
        to the
        holders of the Class B Notes for amounts due and unpaid on the Class B Notes
        for
        interest (except for Noteholders’ Interest Carryover Shortfall), without
        preference or priority of any kind, according to the amounts due and payable
        on
        the Class B Notes for interest (except for Noteholders’ Interest Carryover
        Shortfall);

       

      FOURTH:
        to the
        holders of the Class C Notes for amounts due and unpaid on the Class C Notes
        for
        interest (except for Noteholders’ Interest Carryover Shortfall), without
        preference or priority of any kind, according to the amounts due and payable
        on
        the Class C Notes for interest (except for Noteholders’ Interest Carryover
        Shortfall);

       

      FIFTH:
        to the
        holders of the Class D Notes for amounts due and unpaid on the Class D Notes
        for
        interest (except for Noteholders’ Interest Carryover Shortfall), without
        preference or priority of any kind, according to the amounts due and payable
        on
        the Class D Notes for interest (except for Noteholders’ Interest Carryover
        Shortfall);

       

      SIXTH:
        pro rata
        (i) to
        the holders of the Class A Notes for amounts due and unpaid on the Class
        A Notes
        for principal, ratably, without preference or priority of any kind, according
        to
        the amounts due and payable on the Class A Notes for principal, until the
        Outstanding Amount of the Class A Notes is zero, and (ii) to the Liquidity
        Provider for principal until the Liquidity Note Balance is zero;

       

      SEVENTH:
        to the
        holders of the Class B Notes for amounts due and unpaid on the Class B Notes
        for
        Noteholders’ Interest Carryover Shortfall, without preference or priority of any
        kind, according to the amounts due and payable on the Class B Notes for
        Noteholders’ Interest Carryover Shortfall;

       

      EIGHTH:
        to the
        holders of the Class B Notes for amounts due and unpaid on the Class B Notes
        for
        principal, without preference or priority of any kind, according to the amounts
        due and payable on the Class B Notes for principal, until the Outstanding
        Amount
        of the Class B Notes is zero;

       

      NINTH:
        to the
        holders of the Class C Notes for amounts due and unpaid on the Class C Notes
        for
        Noteholders’ Interest Carryover Shortfall, without preference or priority of any
        kind, according to the amounts due and payable on the Class C Notes for
        Noteholders’ Interest Carryover Shortfall;

       

      TENTH:
        to the
        holders of the Class C Notes for amounts due and unpaid on the Class C Notes
        for
        principal, without preference or priority of any kind, according to the amounts
        due and payable on the Class C Notes for principal, until the Outstanding
        Amount
        of the Class C Notes is zero;

       

      ELEVENTH:
        to the
        holders of the Class D Notes for amounts due and unpaid on the Class D Notes
        for
        Noteholders’ Interest Carryover Shortfall, without preference or priority of any
        kind, according to the amounts due and payable on the Class D Notes for
        Noteholders’ Interest Carryover Shortfall;

       

      TWELFTH:
        to the
        holders of the Class D Notes for amounts due and unpaid on the Class D Notes
        for
        principal, without preference or priority of any kind, according to the amounts
        due and payable on the Class D Notes for principal, until the Outstanding
        Amount
        of the Class D Notes is zero;

       

      THIRTEENTH:
        pro rata
        based
        upon amounts owed, (i) to the Owner Trustee, the Indenture Trustee, the Irish
        Paying Agent and the Back-up Administrator, for all amounts due and owning
        to
        such parties under the Basic Documents to the extent not paid pursuant to
        priority FIRST above, (ii) to FMC, for any unreimbursed Advances made pursuant
        to Section 8.11, (iii) to the Servicer, the Administrator and the Guarantee
        Agency, for all amounts due and owing to such parties pursuant to the Basic
        Documents, and (iv) to the Liquidity Provider for all amounts due and owing
        to
        the Liquidity Provider under the Liquidity Note Agreement to the extent not
        paid
        pursuant to priority FIRST above;

       

      FOURTEENTH:
        to the
        holders of the Class A-IO Notes any Prepayment Penalties remaining unpaid
        from
        prior Distribution Dates, together with interest thereon at the Note Interest
        Rate for the Class A-IO Notes; and

       

      FIFTEETH:
        to the
        Owner Trustee (on behalf of the Issuer), for distribution to the
        Certificateholders in accordance with the terms of the Trust
        Agreement.

       

      SECTION
        5.05  Optional
        Preservation of the Financed Student Loans.
        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, or, subject to Section
        5.11,
        shall at the written direction of the Interested Noteholders, representing
        not
        less than a majority of the Outstanding Amount of the applicable Classes
        of
        Notes, elect to maintain possession of the related Indenture Trust Estate.
        It is
        the desire of the parties hereto and the holders of the Notes and the Liquidity
        Provider that there be at all times sufficient funds for the payment of
        principal of and interest on each Class of Notes and amounts due to the
        Liquidity Provider under the Liquidity Note Agreement, and the Indenture
        Trustee
        shall take such desire into account when determining whether or not to maintain
        possession of the Indenture Trust Estate. In determining whether to maintain
        possession of the Indenture Trust Estate, 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 Indenture Trust Estate for such
        purpose.

       

      SECTION
        5.06  Limitation
        of Suits.
        No
        holder of the Notes or the Liquidity Provider 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 the following conditions listed below are satisfied:

       

      (i)  such
        holder of the Notes or the Liquidity Provider 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 Outstanding Amount of the Notes and the
        Liquidity Note, in the aggregate, 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
        holders of the Notes or the Liquidity Provider as the case may be 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 Proceeding; 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
        Outstanding Amount of the Notes in the aggregate;

       

      it
        being
        understood and intended that no one or more holders of the Notes or the
        Liquidity Provider 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 the Notes or the Liquidity Provider or
        to
        obtain or to seek to obtain priority or preference over any other holders
        of the
        Notes or the Liquidity Provider or to enforce any right under this Indenture,
        except in the manner herein provided.

       

      If
        the
        Indenture Trustee shall receive conflicting or inconsistent requests and
        indemnity from two or more groups of Noteholders or the Liquidity Provider,
        each
        representing less than a majority of the Outstanding Amount 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  Unconditional
        Rights of Noteholders To Receive Principal and Interest.
        Notwithstanding any other provisions in this Indenture, any holder of any
        Class
        of Notes and the Liquidity Provider shall have the right, which is absolute
        and
        unconditional, to receive payment of the principal of and interest, on such
        Note
        or under the Liquidity Note Agreement, as applicable, on or after the respective
        due dates thereof expressed in such Note or under the Liquidity Note Agreement,
        as applicable, 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 of any such Class of Notes or the Liquidity Provider.

       

      SECTION
        5.08  Restoration
        of Rights and Remedies.
        If the
        Indenture Trustee or any holder of Notes or the Liquidity Provider 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 holder of Notes
        or
        the Liquidity Provider, then and in every such case the Issuer, the Indenture
        Trustee and the holders of the Notes or the Liquidity Provider shall, subject
        to
        any determination in such Proceeding, be restored severally and respectively
        to
        their former positions hereunder, and thereafter all rights and remedies
        of the
        Indenture Trustee and the holders of the Notes and the Liquidity Provider
        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
        or to
        the holders of the Notes or the Liquidity Provider 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 or any holder of Notes or the
        Liquidity Provider to exercise any right or remedy accruing upon any Default
        shall impair any such right or remedy or constitute a waiver of any such
        Default
        or an acquiescence therein. Every right and remedy given by this Article
        V or by
        law to the Indenture Trustee or to the holders of the Notes or the Liquidity
        Provider may be exercised from time to time, and as often as may be deemed
        expedient, by the Indenture Trustee or by the holders of the Notes or the
        Liquidity Provider.

       

      SECTION
        5.11  Control
        by Noteholders.
        With
        respect to the Notes, the Interested Noteholders, representing not less than
        a
        majority of the Outstanding Amount of the applicable Classes of Notes and
        Liquidity Note (or, in each case, if only one Class is affected thereby,
        a
        majority of the Outstanding Amount of such Class) 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;

       

      (ii)  subject
        to the express terms of Section 5.04, any direction to the Indenture Trustee
        to
        sell or liquidate the Indenture Trust Estate shall be by the holders of not
        less
        than 100% of the Outstanding Amount of the Notes and the Liquidity
        Provider;

       

      (iii)  if
        the
        conditions set forth in Section 5.05 have been satisfied and the Indenture
        Trustee elects to retain the Indenture Trust Estate pursuant to such Section,
        then any direction to the Indenture Trustee by the holders of less than 100%
        of
        the Outstanding Amount of the Notes and the Liquidity Provider, to sell or
        liquidate the Indenture 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;

       

      provided,
        however,
        that,
        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 holders of the Notes not consenting to such
        action.

       

      SECTION
        5.12  Waiver
        of Past Defaults.
        Prior
        to the declaration of the acceleration of the Notes as provided in Section
        5.02,
        the Interested Noteholders representing not less than a majority of the
        Outstanding Amount of the applicable Classes of Notes and the Liquidity Note,
        may waive any past Default and its consequences except a Default (a) in payment
        when due of principal of or interest on any Note or amounts due the Liquidity
        Provider under the Liquidity Note Agreement or (b) in respect of a covenant
        or
        provision hereof which cannot be modified or amended without the consent
        of each
        holder of the Notes or the Liquidity Provider. In the case of any such waiver,
        the Issuer, the Indenture Trustee and the holders of the Notes and the Liquidity
        Provider shall be restored to their former positions and rights hereunder,
        respectively; but no such waiver shall extend to any subsequent or other
        Default
        or impair any right consequent thereto.

       

      Upon
        any
        such waiver, such Default shall cease to exist and 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 Default or impair any right consequent
        thereto.

       

      SECTION
        5.13  Undertaking
        for Costs.
        All
        parties to this Indenture agree, and each holder of the Notes by such
        Noteholder’s acceptance of any Note 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 shall not apply to
        (a)
        any suit instituted by the Indenture Trustee, (b) any suit instituted by
        any
        holder of the Notes or group of holders of the Notes, in each case holding
        in
        the aggregate more than 10% of the Outstanding Amount of the Notes or (c)
        any
        suit instituted by any holder of the Notes 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
        will 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  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
        holders of the Notes 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 Indenture 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) or (c), as the case may
        be.

       

      SECTION
        5.16  Performance
        and Enforcement of Certain Obligations.
        (a)
        Promptly
        following a request from the Indenture Trustee, and at the Administrator’s
        expense, the Issuer shall take all such lawful action as the Indenture Trustee
        may request to compel or secure the performance and observance by the Depositor,
        the Sellers, the Administrator, the Back-up Administrator, the Liquidity
        Provider and the Servicers, as applicable, of each of their obligations to
        the
        Issuer under or in connection with the Basic Documents in accordance with
        the
        terms thereof, and to exercise any and all rights, remedies, powers and
        privileges lawfully available to the Issuer under or in connection with the
        Basic Documents, including the transmission of notices of default and the
        institution of legal or administrative actions or proceedings to compel or
        secure performance by the Depositor, the Sellers, the Administrator, the
        Back-up
        Administrator, the Liquidity Provider or the Servicers of each of their
        obligations under the Basic Documents.

       

      (b)  If
        an
        Event of Default has occurred and is continuing, the Indenture Trustee shall,
        subject to Section 5.11, at the direction (which direction shall be in writing
        or by telephone (confirmed in writing promptly thereafter)) of the Interested
        Noteholders, representing not less than 66.67% of the Outstanding Amount
        of the
        applicable Classes of Notes, exercise all rights, remedies, powers, privileges
        and claims of the Issuer against the Depositor, the Sellers, the Administrator,
        the Back-up Administrator, the Liquidity Provider, the Servicers or the
        Guarantee Agency under or in connection with the Basic Documents, including
        the
        right or power to take any action to compel or secure performance or observance
        by the Depositor, the Sellers, the Administrator, the Back-up Administrator,
        the
        Liquidity Provider and the Servicers of each of their obligations to the
        Issuer
        thereunder and to give any consent, request, notice, direction, approval,
        extension or waiver under the Basic Documents and any right of the Issuer
        to
        take such action shall be suspended.

       

      SECTION
        5.17  Notice
        of Defaults.
        Within
        90 days after the occurrence of any Default hereunder with respect to the
        Notes, the Indenture Trustee shall transmit in the manner and to the extent
        provided in TIA Section 313(c), notice of such Default hereunder to which a
        Responsible Officer of the Indenture Trustee has actual knowledge or is in
        receipt of a written notice thereof in accordance with the terms of this
        Indenture, unless such Default shall have been cured or waived; provided,
        however,
        that,
        except in the case of a Default in the payment of the principal of or interest
        with respect to any Note, the Indenture Trustee shall be protected in
        withholding such notice if and so long as a Responsible Officer of the Indenture
        Trustee in good faith determines that the withholding of such notice is in
        the
        interest of the Noteholders.

       

      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 the other Basic Documents to
        which
        the Indenture Trustee is a party, 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 a Responsible Officer
        of the
        Indenture Trustee and conforming to the requirements of this Indenture;
provided,
        however,
        that
        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;

       

      (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
        pursuant to Section 5.11.

       

      (d)  Every
        provision of this Indenture that in any way relates to the Indenture Trustee
        is
        subject to paragraphs (a), (b), (c) and (g) of this Section 6.01.

       

      (e)  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.

       

      (f)  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.

       

      (g)  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 repayments of such funds
        or
        adequate indemnity satisfactory to it against any loss, liability or expense
        is
        not reasonably assured to it.

       

      (h)  Except
        as
        expressly provided in the Basic Documents, the Indenture Trustee shall have
        no
        obligation to administer, service or collect the Financed Student Loans or
        to
        maintain, monitor or otherwise supervise the administration, servicing or
        collection of the Financed Student Loans.

       

      (i)  In
        the
        event that the Indenture Trustee is the Paying Agent or the Note Registrar,
        the
        rights and protections afforded to the Indenture Trustee pursuant to this
        Indenture shall also be afforded to the Indenture Trustee in its capacity
        as
        Paying Agent and Note Registrar.

       

      (j)  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 6.01.

       

      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 such document.

       

      (b)  Before
        the Indenture Trustee acts or refrains from acting, it may require an Officers’
Certificate of the Issuer 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 such Officers’ 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.

       

      (f)  In
        the
        event that the Person acting as Indenture Trustee is also acting as securities
        intermediary, all the rights, powers, immunities and indemnities afforded
        to the
        Indenture Trustee under the Basic Documents shall also be afforded to the
        securities intermediary.

       

      (g)  Absent
        willful misconduct or fraud, the Indenture Trustee shall not be liable for
        any
        punitive damages, regardless of the form of action and whether or not any
        such
        damages were foreseeable or contemplated.

       

      (h)  The
        Indenture Trustee shall not be deemed to have notice of any Default or Event
        of
        Default unless a Responsible Officer of the Indenture Trustee has actual
        knowledge thereof or unless written notice of any event which is in fact
        such
        Default or Event of Default is received by the Indenture Trustee at the
        Corporate Trust Office, and such notice references the Notes under this
        Indenture.

       

      (i)  Any
        permissive right or authority granted to the Indenture Trustee shall not
        be
        construed as a mandatory duty.

       

      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
        Paying
        Agent, Note Registrar, co-registrar or co-paying agent may do the same with
        like
        rights. However, the Indenture Trustee must comply with Section
        6.11.

       

      SECTION
        6.04  Indenture
        Trustee’s Disclaimer.
        The
        Indenture Trustee shall not be responsible for and makes no representation
        as to
        the validity or adequacy of this Indenture or the Notes, it shall not be
        accountable for the Issuer’s use of the proceeds from the Notes, and it shall
        not be 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 Defaults.
        If a
        Default occurs and is continuing and if it is either actually known or written
        notice of the existence thereof has been received by a Responsible Officer
        of
        the Indenture Trustee, the Indenture Trustee shall mail to each holder of
        the
        Notes and the Liquidity Provider notice of the Default within 90 days after
        it
        occurs. Except in the case of a Default in payment of principal of or interest
        on the Notes, the Indenture Trustee may withhold the notice to the holders
        of
        the Notes if and so long as a committee of its Responsible Officers in good
        faith determines that withholding the notice is in the interests of holders
        of
        the Notes.

       

      SECTION
        6.06  Reports
        by Indenture Trustee to Noteholders.
        The
        Indenture Trustee shall deliver to each holder of the Notes (and to each
        Person
        who was a holder of the Notes at any time during the applicable calendar
        year)
        and to the Liquidity Provider such information with respect to the Notes
        or the
        Liquidity Note, as applicable, as may be required to enable such holder or
        the
        Liquidity Provider, as applicable, to prepare its Federal and state income
        tax
        returns.

       

      SECTION
        6.07  Compensation
        and Indemnity.
        The
        Issuer shall pay to the Indenture Trustee from time to time reasonable
        compensation for all services rendered under this Indenture, and also all
        reasonable expenses, charges, counsel fees and other disbursements, including
        those of their attorneys, agents and employees, incurred in and about the
        performance of their powers and duties under this Indenture. The Issuer further
        agrees to indemnify and save the Indenture Trustee harmless against any
        liabilities which it may incur in the exercise and performance of its powers
        and
        duties hereunder, and which are not due to its negligence or willful misconduct,
        to the extent solely payable from the Indenture Trust Estate. To secure the
        Indenture Trustee’s right to receive amounts pursuant to this Section 6.07, the
        Indenture Trustee shall have a lien against the Indenture Trust Estate that
        is,
        except to the extent otherwise expressly provided herein, subordinate to
        the
        rights of the Noteholders and the Liquidity Provider. Without prejudice to
        its
        rights hereunder, when the Indenture Trustee incurs expenses or renders services
        after a Default specified in Sections 5.01(iv) or (v) occurs, such expenses
        and
        the compensation for such services (including the fees and expenses of its
        agent
        and counsel) shall constitute expenses of administration under the applicable
        bankruptcy law. The provisions of this Section 6.07 shall survive the
        satisfaction and discharge of this Indenture and the resignation or removal
        of
        the Indenture Trustee.

       

      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.
        The
        Administrator shall remove the Indenture Trustee if:

       

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

       

      (ii)  an
        Insolvency Event occurs with respect to the Indenture Trustee;

       

      (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
        Indenture Trustee for any reason (the Indenture Trustee in such event being
        referred to herein as the retiring Indenture Trustee), the Administrator
        shall
        promptly appoint a successor Indenture Trustee.

       

      A
        successor Indenture Trustee shall deliver a written acceptance of its
        appointment to the retiring Indenture Trustee and 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 the holders of the Notes, the Liquidity
        Provider and each Rating Agency. The retiring Indenture Trustee shall promptly
        transfer all property held by it as Indenture Trustee to the successor Indenture
        Trustee upon payment of all monies due and owing to the retiring Indenture
        Trustee.

       

      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 in Outstanding Amount 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 holder of the Notes
        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
        and the Administrator’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 with written notice of any such transaction provided
        it is
        not otherwise obligated to maintain such information confidential.

       

      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-Trustee or Separate 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 Indenture 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 Indenture Trust Estate, and
        to vest
        in such Person or Persons, in such capacity and for the benefit of the holders
        of the Notes, such title to the Indenture Trust Estate, or any part hereof,
        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 holders of the Notes 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:

       

      (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 Indenture 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 Indenture 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 Indenture
        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 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.
        There
        shall at all times be an Indenture Trustee hereunder which shall be eligible
        to
        act as Indenture Trustee under TIA Section 310(a)(1) and shall have a
        combined capital and surplus of at least $50,000,000 (and, with respect to
        any
        successor Indenture Trustee, having a rating of at least “Baa3” from Moody’s
        unless the Rating Agency Condition is satisfied). If such corporation publishes
        reports of condition at least annually, pursuant to law or the requirements
        of
        federal, state, territorial or District of Columbia supervising or examining
        authority, then for the purposes of this Section 6.11, 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.
        If at
        any time the Indenture Trustee shall cease to be eligible in accordance with
        the
        provisions of this Section 6.11, it shall resign immediately in the manner
        and with the effect specified in this Article VI. Neither the Issuer nor
        any Person directly or indirectly controlling or controlled by, or under
        common
        control with, the Issuer shall serve as 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 the earlier of (i) each Record Date and (ii) three
        months after the last Record Date, a list, in such form as the Indenture
        Trustee
        may reasonably require, of the names and addresses of the holders of the
        Notes
        as of such Record Date, (b) at such other times as the Indenture Trustee
        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.

       

      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 the Notes contained
        in
        the most recent list furnished to the Indenture Trustee as provided in Section
        7.01 and the names and addresses of the holders of the 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)  Upon
        receipt by the Indenture Trustee of any request by a holder of the Notes
        to
        receive a copy of the current list of holders of the Notes, the Indenture
        Trustee shall promptly notify the Administrator thereof by providing to the
        Administrator a copy of such request and a copy of the list of holders of
        the
        Notes produced in response thereto.

       

      (c)  The
        Indenture Trustee shall furnish to the holders of the Notes promptly upon
        receipt of a written request therefor, duplicates or copies of all reports,
        notices, requests, demands, certificates, financial statements and any other
        instruments furnished to the Indenture Trustee under the Basic
        Documents.

       

      SECTION
        7.03  Reports
        by Issuer.
        (a)
        The
        Issuer shall cause the Administrator to furnish the Issuer and the Indenture
        Trustee the reports required by the Administration Agreement and by Section
        3.24
        of this Indenture.

       

      (b)  Unless
        the Issuer otherwise determines, the fiscal year of the Issuer shall end
        on June
        30 of each year. In the case of any change to the Issuer’s fiscal year, the
        Administrator shall notify the Indenture Trustee of such change. 

       

      ARTICLE
        VIII

       

      Accounts,
        Disbursements and Releases

       

      SECTION
        8.01  Collection
        of Money.
        (a)
        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
        on
        behalf of the holders of the Notes and the Liquidity Provider 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 Indenture 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 under this Indenture and any right to proceed thereafter as provided
        in
        Article V.

       

      (b)  The
        Indenture Trustee shall deposit into the Collection Account all payments
        it
        receives from the Servicers by or on behalf of the Obligors with respect
        to the
        Student Loans, and all related Liquidation Proceeds and Recoveries, as collected
        during the Collection Period. For purposes of this Article VIII, the phrase
        “payments by or on behalf of Obligors” shall mean payments made with respect to
        the Student Loans, as applicable, by or on behalf of borrowers thereof and
        the
        Guarantee Agency.

       

      (c)  The
        Indenture Trustee shall deposit into the Collection Account the aggregate
        Purchase Amount it receives with respect to Purchased Student Loans and all
        other amounts received from the Sellers or the Servicers with respect to
        the
        Student Loans.

       

      SECTION
        8.02  Trust
        Accounts.
        (a)(i)  The
        Issuer, for the benefit of the Noteholders and itself, shall establish and
        maintain in the name of the Indenture Trustee an Eligible Deposit Account
        (the
“Collection Account”), bearing a designation clearly indicating that the funds
        deposited therein are held for the benefit of the Noteholders, the Liquidity
        Provider and the Issuer. The Collection Account will initially be established
        as
        a segregated account at U.S. Bank National Association in the name of the
        Indenture Trustee. The Issuer will make an initial deposit on the Closing
        Date
        into the Collection Account of cash equal to $1,634,418,538, of which
        $1,460,925,573 amount will be disbursed on the Closing Date by the Indenture
        Trustee, pursuant to written instructions of the Administrator, to acquire
        the
        Financed Student Loans and $173,308,476 will be disbursed on the Closing
        Date by
        the Indenture Trustee, pursuant to written instructions of the Administrator,
        to
        pay the First Marblehead Corporation a structuring advisory fee.

       

      (ii)  The
        Issuer, for the benefit of the Noteholders, the Liquidity Provider and itself,
        shall establish and maintain in the name of the Indenture Trustee an Eligible
        Deposit Account (the “Reserve Account”), bearing a designation clearly
        indicating that the funds deposited therein are held for the benefit of the
        Noteholders and the Issuer. The Reserve Account initially will be established
        as
        a segregated account at U.S. Bank National Association in the name of the
        Indenture Trustee. The Issuer will make an initial deposit on the Closing
        Date
        into the Reserve Account of cash or certain Eligible Investments equal to
        the
        Reserve Account Initial Deposit

       

      (b)  Funds
        on
        deposit in the Collection Account and the Reserve Account (together, the
“Trust
        Accounts”) shall be invested by the Indenture Trustee (or any custodian or
        designated agent with respect to any amounts on deposit in such accounts)
        in
        Eligible Investments pursuant to written instructions by the Issuer;
provided,
        however,
        it is
        understood and agreed that the Indenture Trustee shall not be liable for
        any
        loss arising from such investment in Eligible Investments. All such Eligible
        Investments shall be held by (or by any custodian on behalf of) the Indenture
        Trustee for the benefit of the Noteholders, the Liquidity Provider and the
        Issuer; provided that on the Business Day preceding each Distribution Date
        on
        which funds in the applicable Trust Account will be needed, all interest
        and
        other investment income (net of losses and investment expenses) on funds
        on
        deposit therein shall be deposited into the Collection Account and shall
        constitute a portion of the Available Funds for such Distribution Date. Other
        than as described in the following proviso or as otherwise permitted by the
        Rating Agencies, funds on deposit in the Trust Accounts shall be invested
        in
        Eligible Investments that will mature so that such funds will be available
        at
        the close of business on the Business Day preceding the following Distribution
        Date for which such funds are needed; provided,
        however,
        that
        funds on deposit in Trust Accounts may be invested in Eligible Investments
        of
        the Indenture Trustee which may mature so that such funds will be available
        on
        such Distribution Date. Funds deposited in a Trust Account on a Business
        Day
        which immediately precedes a Distribution Date upon the maturity of any Eligible
        Investments are not required to be invested overnight

       

      (c)  The
        Indenture Trustee, on behalf of the Noteholders and the Liquidity Provider,
        shall possess all right, title and interest in all funds on deposit from
        time to
        time in the Trust Accounts and in all proceeds thereof (including all income
        thereon) and all such funds, investments, proceeds and income shall be part
        of
        the Indenture Trust Estate. Subject to the Issuer’s power to instruct the
        Indenture Trustee pursuant to paragraph (b) above, the Trust Accounts shall
        be
        under the sole dominion and control of the Indenture Trustee for the benefit
        of
        the Noteholders and the Liquidity Provider. If, at any time, any of the Trust
        Accounts ceases to be an Eligible Deposit Account, the Indenture Trustee
        (or the
        Administrator on its behalf) agrees, by its acceptance hereto, that it shall
        within 5 Business Days (or such longer period, not to exceed 30 calendar
        days,
        as to which each Rating Agency may consent) establish a new Trust Account
        as an
        Eligible Deposit Account and shall transfer any cash and/or any investments
        to
        such new Trust Account. In connection with the foregoing, the Issuer agrees
        that, in the event that any of the Trust Accounts are not accounts with the
        Indenture Trustee, the Issuer shall notify the Indenture Trustee, in writing,
        promptly upon any of such Trust Accounts ceasing to be an Eligible Deposit
        Account.

       

      (A)  With
        respect to the Trust Account Property, the Indenture Trustee agrees, by its
        acceptance hereof, that:

       

      (B)  any
        Trust
        Account Property that is held in deposit accounts shall be held solely in
        Eligible Deposit Accounts; and, subject to Section 8.02(b), each such
        Eligible Deposit Account shall be subject to the exclusive custody and control
        of the Indenture Trustee, and the Indenture Trustee shall have sole signature
        authority with respect thereto;

       

      (C)  any
        Trust
        Account Property shall be Delivered to the Indenture Trustee in accordance
        with
        the definition of “Delivery” and shall be held, pending maturity or disposition,
        solely by the Indenture Trustee or such other Person acting solely for the
        Indenture Trustee as required for Delivery;

       

      (D)  In
        the
        event that the Indenture Trustee, in its capacity as securities intermediary
        has
        or subsequently obtains by agreement, operation of law or otherwise a security
        interest in the Trust Accounts or any security entitlement credited thereto,
        the
        Indenture Trustee, in its capacity as securities intermediary hereby agrees
        that
        such security interest shall be subordinate to the security interest of the
        Indenture Trustee for the benefit of the Noteholders and the Liquidity Provider.
        The financial assets and other items deposited to the Trust Accounts will
        not be
        subject to deduction, set-off, banker’s lien, or any other right in favor of any
        person other than the Indenture Trustee (except that the Indenture Trustee,
        in
        its capacity as securities intermediary may set off (i) the face amount of
        any
        checks which have been credited to the Trust Accounts but are subsequently
        returned unpaid because of uncollected or insufficient funds, and (ii) all
        amounts due to it in respect of its customary fees and expenses for the routine
        maintenance and operation of the Trust Accounts;

       

      (E)  The
        Issuer shall instruct the Indenture Trustee to make withdrawals and payments
        from the Trust Accounts for the purpose of permitting the Indenture Trustee
        to
        carry out its duties under this Indenture;

       

      (F)  Each
        Trust Account provided for herein to be established and maintained by the
        Indenture Trustee shall be so established and maintained by the Indenture
        Trustee, as securities intermediary (in such capacity, the “Securities
        Intermediary”). Each item of “investment property” within the meaning of Section
        9-102(a)(49) of the New York Uniform Commercial Code (which shall not be
        deemed
        to include the Financed Student Loans or the related notes evidencing the
        Financed Student Loans) or “money” within the meaning of Section 1-201(24) of
        the New York Uniform Commercial Code, that is (whether investment property,
        security, instrument or cash) credited to such a Trust Account shall be treated
        as a “financial asset” within the meaning of Section 8-102(a)(9) of the New York
        Uniform Commercial Code. The State of New York shall be deemed to be the
        Securities Intermediary’s location for purposes of the New York Uniform
        Commercial Code, and each such Trust Account (as well as the securities
        entitlements related thereto) shall be governed by the laws of the State
        of New
        York; and

       

      (G)  Following
        the filing of any UCC financing statement with respect to this Indenture,
        the
        Indenture Trustee hereby agrees to notify the Issuer no earlier than six
        months
        prior to the expiration of such filing of the need to file continuation
        statements, and to the extent permitted by law, the Issuer shall execute
        and
        file such continuation statements, and provide a copy thereof to the Indenture
        Trustee along with an Opinion of Counsel to the effect that all action has
        been
        taken as is necessary to maintain the lien and security interest created
        by this
        Indenture.

       

      (d)  On
        each
        Distribution Date on which a Class B Note Interest Trigger, a Class C Note
        Interest Trigger or a Class D Note Interest Trigger is not in effect, the
        Administrator shall instruct the Indenture Trustee in writing (based on the
        information contained in the Administrator’s Officer’s Certificate and each
        related Servicer’s Report delivered pursuant to the Administration Agreement) to
        make the following deposits and distributions to the Persons or to the account
        specified below by 11:00 a.m. (New York time), to the extent of the amount
        of Available Funds in the Collection Account, in the following order of priority
        (except as otherwise provided in Sections 5.04(b) or 5.04(c)) and the Indenture
        Trustee shall comply with such instruction:

       

      (1)  FIRST:
        pro rata
        (i)
        Indenture Trustee fees and expenses, Irish Paying Agent fees and expenses,
        Owner
        Trustee fees and expenses, and Back-up Administrator fees and expenses due
        on
        and allocated to such Distribution Date in an aggregate amount not to exceed
        $200,000, per annum; (ii) Servicing Fees and expenses with respect to the
        Financed Student Loans due on such Distribution Date and all prior unpaid
        Servicing Fees and expenses allocated to the Financed Student Loans up to
        the
        amount specified in the Servicing Agreement, (iii) Administration Fees and
        expenses with respect to the Financed Student Loans up to the amount specified
        in the Administration Agreement; and (iv) Liquidity Provider fees and expenses
        up to the amount specified in the Liquidity Note Agreement;

       

      (2)  SECOND:
        to
        TERI, the additional guaranty fees pursuant to the TERI Guaranty Agreements,
        which will be deposited into the TERI Pledge Fund;

       

      (3)  THIRD:
        to the
        holders of each Class of Class A Notes, the Noteholders’ Interest Distribution
        Amount for such Class A Notes and to the Liquidity Provider, any interest
        due on
        the Liquidity Note Balance on a pro rata
        basis;

       

      (4)  FOURTH:
        to the
        holders of the Class B Notes, the Noteholders’ Interest Distribution Amount for
        the Class B Notes;

       

      (5)  FIFTH:
        to the
        holders of the Class C Notes, the Noteholders’ Interest Distribution Amount for
        the Class C Notes;

       

      (6)  SIXTH:
        to the
        holders of the Class D Notes, the Noteholders’ Interest Distribution Amount for
        the Class D Notes;

       

      (7)  SEVENTH:
        to the
        Reserve Account, an amount up to the amount necessary to reinstate the balance
        of the Reserve Account to equal the excess, if any, of the Required Reserve
        Amount over the then applicable Liquidity Note Commitment;

       

      (8)  EIGHTH:
        to TERI
        (or the TERI Pledge Fund), to purchase Rehabilitated Financed Student
        Loans;

       

      (9)  NINTH:
        to the
        Liquidity Provider, until the Liquidity Note Balance is reduced to zero;
        

       

      (10)  TENTH:
        the
        Noteholders’ Principal Distribution Amount to the holders of (i) the Class A-1
        Notes, until paid in full, then (ii) the Class A-2 Notes, until paid in full,
        then (iii) the Class A-3 Notes, until paid in full, then (iv) the Class A-4
        Notes, until paid in full, then (v) the Class A-5, until paid in full, then
        (vi)
        the Class B Notes, to pay any Noteholders’ Interest Carryover Shortfall for the
        Class B Notes, until paid in full, then (vii) the Class B Notes, until paid
        in
        full, then (viii) the Class C Notes, to pay any Noteholders’ Interest Carryover
        Shortfall for the Class C Notes, until paid in full, then (ix) the Class
        C
        Notes, until paid in full, then (x) the Class D Notes, to pay any Noteholders’
Interest Carryover Shortfall for the Class D Notes, until paid in full, and
        finally, (xi) the Class D Notes, until paid in full; provided,
        however,
        that on and after the Stepdown Date and so long as no Subordinate Note Principal
        Trigger has occurred and remains in effect, the Class A Percentage of the
        Noteholders’ Principal Distribution Amount will be payable to the Class A Notes
        (in the same order of priority set forth above), the Class B Percentage of
        the
        Noteholders’ Principal Distribution Amount will be payable to the Class B Notes
        first to pay any Noteholders’ Interest Carryover Shortfall for the Class B Notes
        and then to pay principal until paid in full, the Class C Percentage of the
        Noteholders’ Principal Distribution Amount will be payable to the Class C Notes
        first to pay any Noteholders’ Interest Carryover Shortfall for the Class C and
        then to pay principal until paid in full, and the Class D Percentage of the
        Noteholders’ Principal Distribution Amount will be payable to the Class D Notes
        first to pay any Noteholders’ Interest Carryover Shortfall for the Class D and
        then to pay principal until paid in full;

       

      (11)  ELEVENTH:
        to the
        holders of the Class B Notes, any remaining Noteholders’ Interest Carryover
        Shortfall for the Class B Notes;

       

      (12)  TWELFTH:
        to the
        holders of the Class C Notes, any remaining Noteholders’ Interest Carryover
        Shortfall for the Class C Notes;

       

      (13)  THIRTEENTH:
        to the
        holders of the Class D Notes, any remaining Noteholders’ Interest Carryover
        Shortfall for the Class D Notes;

       

      (14)  FOURTEENTH:
        pro rata:
        (i) any
        unreimbursed Advances to FMC, (ii) for all amounts in excess of the maximum
        amounts specified in priority FIRST: for Indenture Trustee fees and expenses
        pursuant to the Indenture; for Irish Paying Agent fees and expenses pursuant
        to
        the Irish Paying Agent Agreement; Owner Trustee fees and expenses pursuant
        to
        the Trust Agreement; for Back-up Administrator fees and expenses pursuant
        to the
        Back-up Administration Agreement; (iii) indemnities, fees and expenses of
        the
        Servicer; (iv) the portion of the Administration Fee and expenses allocated
        to
        the Notes and (v) all unpaid Administration Fees and expenses from prior
        Collection Periods allocated to the Notes ; and (vi) all indemnities, fees
        and
        expenses due and owing to the Liquidity Provider pursuant to the Liquidity
        Note
        Agreement..

       

      (15)  FIFTEENTH:
        (a) if
        a Turbo Trigger is in effect, to the holders of the Notes, any remaining
        amounts
        as payment of principal allocated among the Noteholders as described in priority
        TENTH until the Outstanding Amount of each Class of Notes is reduced to
        zero;

       

      (16)  SIXTEENTH:
        to the
        holders of the Class A-IO Notes any Prepayment Penalty for that Distribution
        Date and any Prepayment Penalties remaining unpaid from prior Distribution
        Dates, together with interest thereon at the Note Interest Rate for the Class
        A-IO Notes; and

       

      (17)  SEVENTEENTH:
        to FMC,
        any unpaid and accrued structuring advisory fees, and then to the
        Certificateholders, any remaining amounts.

       

      Notwithstanding
        the foregoing, for each Distribution Date on which (i) a Class B Note Interest
        Trigger is in effect (x) amounts payable pursuant to priority FOURTH will
        instead be paid following payment of the Noteholders’ Principal Distribution
        Amount to the Class A Notes pursuant to priority TENTH (i) through (v),
        inclusive, (y) amounts payable pursuant to priorities FIFTH and TENTH (viii)
        and
        (ix) will instead be paid following priority ELEVENTH and (z) amounts payable
        pursuant to priorities SIXTH and TENTH (x) and (xi) will instead be paid
        following priority TWELFTH; (ii) a Class C Note Interest Trigger is in effect
        (x) amounts payable pursuant to priorities FIFTH and TENTH (viii) and (ix)
        will
        instead be paid following priority ELEVENTH and (y) amounts payable pursuant
        to
        priorities SIXTH and TENTH (x) and (xi) will instead be paid following priority
        TWELFTH; and (iii) a Class D Note Interest Trigger is in effect amounts payable
        pursuant to priorities SIXTH and TENTH (x) and (xi) will instead be paid
        following priority TWELFTH.

       

      SECTION
        8.03  General
        Provisions Regarding Accounts.
        (a) So
        long as no Default shall have occurred and be continuing, all or a portion
        of
        the funds in the Trust Accounts shall be invested in Eligible Investments
        and
        reinvested by the Indenture Trustee upon Issuer Order, subject to the provisions
        of Section 8.01(b). All income or other gain from investments of moneys
        deposited in the Trust Accounts shall be deposited by the Indenture Trustee
        in
        the Collection Account, and any loss resulting from such investments shall
        be
        charged to such Trust Account. The Issuer will not direct the Indenture Trustee
        to make any investment of any funds or to sell any investment held in any
        of the
        Trust Accounts unless the security interest granted and perfected in such
        account will continue to be perfected in such investment or the proceeds
        of such
        sale, in either case without any further action by any Person, and, in
        connection with any direction to the Indenture Trustee to make any such
        investment or sale, if requested by the Indenture Trustee, the Issuer shall
        deliver to the Indenture Trustee an Opinion of Counsel, acceptable to the
        Indenture Trustee, to such effect.

       

      (b)  Subject
        to Section 6.01(c), the Indenture Trustee shall not in any way be held liable
        by
        reason of any insufficiency in any of the Trust Accounts resulting from any
        loss
        on any Eligible Investment included therein except for losses attributable
        to
        the Indenture Trustee’s failure to make payments on such Eligible Investments
        issued by the Indenture Trustee, in its commercial capacity as principal
        obligor
        and not as trustee, in accordance with their terms.

       

      (c)  If
        (i)
        the Issuer shall have failed to give investment directions for any funds
        on
        deposit in the Trust Accounts to the Indenture Trustee by 1:00 p.m. Eastern
        Time
        (or such other time as may be agreed by the Issuer and Indenture Trustee)
        on any
        Business Day; or (ii) a Default shall have occurred and be continuing, but
        the
        Notes shall not have been declared due and payable pursuant to Section 5.02,
        or,
        if such Notes shall have been declared due and payable following an Event
        of
        Default, amounts collected or receivable from the Indenture Trust Estate
        are
        being applied in accordance with Section 5.04 as if there had not been such
        a
        declaration; then the Indenture Trustee shall, to the fullest extent
        practicable, invest and reinvest funds in the Trust Accounts in one or more
        of
        the Indenture Trustee’s money market mutual funds that is an Eligible
        Investment.

       

      SECTION
        8.04  Release
        of Indenture Trust Estate.
        (a)
        Subject
        to the payment of its fees and expenses pursuant to Section 6.07, 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 this Article VIII 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 moneys.

       

      (b)  The
        Indenture Trustee shall, at such time as there are no Notes Outstanding and
        all
        sums due the Liquidity Provider under the Liquidity Note Agreement and the
        Indenture Trustee pursuant to Section 6.07 have been paid, release any remaining
        portion of the Indenture Trust Estate that secured the Notes and amounts
        due the
        Liquidity Provider under the Liquidity Note Agreement from the lien of this
        Indenture and release to the Issuer or any other Person entitled thereto
        any
        funds then on deposit in the Trust Accounts. The Indenture Trustee shall
        release
        property from the lien of this Indenture pursuant to this Section 8.04(b)
        only
        upon receipt of an Issuer Request accompanied by an Officers’ Certificate of the
        Issuer and an Opinion of Counsel meeting the applicable requirements of Section
        11.01.

       

      SECTION
        8.05  Opinion
        of Counsel.
        The
        Indenture Trustee shall receive at least seven days’ notice when requested by
        the Issuer to take any action pursuant to Section 8.04(a), accompanied by
        copies
        of any instruments involved, and the Indenture Trustee shall also require,
        except in connection with any action contemplated by Section 8.04(c), as
        a
        condition to such action, an Opinion of Counsel, 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
        and such action will not materially and adversely impair the security for
        the
        Notes or the Liquidity Note Agreement or the rights of the holders of the
        Notes
        or the Liquidity Provider in contravention of the provisions of this Indenture.
        Counsel rendering any such opinion may rely, without independent investigation,
        on the accuracy and validity of any certificate or other instrument delivered
        to
        the Indenture Trustee in connection with any such action.

       

      SECTION
        8.06  Cost
        of Issuance Account.
        The
        Issuer shall establish and maintain in the name of the Indenture Trustee
        an
        Eligible Deposit Account (the “Cost of Issuance Account”). The Cost of Issuance
        Account shall not be a Trust Account and the Noteholders and Liquidity Provider
        shall have no interest in the amount deposited therein. The Cost of Issuance
        Account initially will be established as a segregated account at U.S. Bank
        National Association in the name of the Indenture Trustee. The Issuer shall
        make
        a deposit into the Cost of Issuance Account on the Closing Date in an amount
        equal to $2,000,000. Upon receipt of written instructions from the
        Administrator, the Indenture Trustee shall remit funds on deposit in the
        Cost of
        Issuance Account to pay the costs and expenses incurred by the Issuer in
        connection with issuing the Notes. Commencing 60 days after the Closing Date,
        the Indenture Trustee shall remit funds, if any, remaining in the Cost of
        Issuance Account as directed in writing by the Administrator.

       

      SECTION
        8.07  Application
        of Collections.
        (a)
        With
        respect to each Financed Student Loan, all collections (including all
        Guarantee Payments) with respect thereto for the Collection Period shall
        be
        applied to interest and principal on such Financed Student Loan by allocating
        to
        interest the portion of such collection equal to the product of (A) the
        applicable interest rate on such Financed Student Loan, (B) the unpaid
        principal balance of such Financed Student Loan, and (C) the period of time
        elapsed since the preceding payment of interest on such Financed Student
        Loan
        was made (over the actual number of days in a year) (“Interest Collections”) and
        by allocating the remainder of such collection to principal.

       

      (b)  All
        Liquidation Proceeds shall be applied to the related Financed Student
        Loan.

       

      SECTION
        8.08  Reserve
        Account.
        (a)  On
        the Closing Date, the Issuer shall deposit the Reserve Account Initial Deposit
        into the Reserve Account. The Indenture Trustee shall deposit into the Reserve
        Account the amounts, if any, required to be deposited pursuant to Sections
        8.02,
        8.10 and 8.11.

       

      (b)  (i)
        If
        the amounts payable for any Distribution Date pursuant to Section 8.02(d)(1)
        exceed the amount distributed or allocated to the applicable parties on such
        Distribution Date (exclusive of the amounts described in the second proviso
        to
        the definition of “Available Funds” included in Appendix A hereto), the
        Administrator shall instruct the Indenture Trustee in writing to withdraw
        from
        the Reserve Account on such Distribution Date an amount equal to such excess,
        to
        the extent of funds available therein, and to distribute or allocate such
        amounts to the applicable parties pro rata
        (based
        upon the amount owed to such parties); provided,
        however,
        that if
        the Liquidity Note Commitment exceeds $0 and the Liquidity Provider is not
        in
        default under the Liquidity Note Agreement, the Administrator will not instruct
        the Indenture Trustee to withdraw amounts from the Reserve Account that would
        cause the amount of funds then remaining in the Reserve Account to be less
        than
        the Reserve Account Minimum Balance.

       

      (ii)  If
        the
        amounts payable for any Distribution Date pursuant to Section 8.02(d)(2)
        exceed
        the amount transferred to the TERI Pledge Fund on such Distribution Date
        (exclusive of the amounts described in the second proviso to the definition
        of
“Available Funds” included in Appendix A hereto), the
        Administrator shall instruct the Indenture Trustee in writing to withdraw
        from
        the Reserve Account on such Distribution Date an amount equal to such
        excess,
        to the
        extent of funds available therein after giving effect to paragraph (b)(i)
        above,
        and to transfer such amount to the TERI Pledge Fund; provided,
        however,
        that if
        the Liquidity Note Commitment exceeds $0 and the Liquidity Provider is not
        in
        default under the Liquidity Note Agreement, the Administrator will not instruct
        the Indenture Trustee to withdraw amounts from the Reserve Account that would
        cause the amount of funds then remaining in the Reserve Account to be less
        than
        the Reserve Account Minimum Balance.

       

      (iii)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class A Notes and
        the interest due on the Liquidity Note Balance for a Distribution Date exceeds
        the amount distributed to the holders of the Class A Notes and the Liquidity
        Provider on such Distribution Date (exclusive of the amounts described in
        the
        second proviso to the definition of “Available Funds” included in Appendix A
        hereto), the Administrator shall instruct the Indenture Trustee in writing
        to
        withdraw from the Reserve Account on such Distribution Date an amount equal
        to
        such excess, to the extent of funds available therein after giving effect
        to
        paragraphs (b)(i) through (b)(ii) above, and to distribute such amount to
        the
        applicable parties pro rata
        (based
        upon the amounts then owed to each such party); provided,
        however,
        that if
        the Liquidity Note Commitment exceeds $0 and the Liquidity Provider is not
        in
        default under the Liquidity Note Agreement, the Administrator will not instruct
        the Indenture Trustee to withdraw amounts from the Reserve Account that would
        cause the amount of funds then remaining in the Reserve Account to be less
        than
        the Reserve Account Minimum Balance.

       

      (iv)  If
        on the
        Final Maturity Date for a Class of Class A Notes, the outstanding principal
        balance of the applicable Class of Class A Notes (prior to giving effect
        to any
        distribution of principal thereon on such date) exceeds the amount of principal
        distributed to the holders of the applicable Class of Class A Notes on such
        date, the Administrator shall instruct the Indenture Trustee in writing on
        such
        date to withdraw from the Reserve Account on such date an amount equal to
        such
        excess, to the extent of funds available therein, after giving effect to
        paragraphs (b)(i) through (b)(iii) above and to distribute such amount, pro
        rata, to the holders of (A) the applicable Class of Class A Notes, in the
        same
        order and priority as is set forth in Section 8.02(d)(10) and (B) the Liquidity
        Note;

       

      (v)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class B Notes for
        a Distribution Date exceeds the amount distributed to the holders of the
        Class B
        Notes on such Distribution Date, the Administrator shall instruct the Indenture
        Trustee in writing to withdraw from the Reserve Account on such Distribution
        Date an amount equal to such excess, to the extent of funds available therein
        after giving effect to paragraphs (b)(i) through (b)(iv) above, and to
        distribute such amount, to the holders of the Class B Notes entitled thereto;
        provided,
        however,
        that if
        the Liquidity Note Commitment exceeds $0 and the Liquidity Provider is not
        in
        default under the Liquidity Note Agreement, the Administrator will not instruct
        the Indenture Trustee to withdraw amounts from the Reserve Account that would
        cause the amount of funds then remaining in the Reserve Account to be less
        than
        the Reserve Account Minimum Balance.

       

      (vi)  If
        on the
        Final Maturity Date for the Class B Notes, the outstanding principal balance
        of
        the Class B Notes (prior to giving effect to any distribution of principal
        thereon on such date) exceeds the amount of principal distributed to the
        holders
        of the Class B Notes on such date, the Administrator shall instruct the
        Indenture Trustee in writing on such date to withdraw from the Reserve Account
        on such date an amount equal to such excess, to the extent of funds available
        therein, after giving effect to paragraphs (b)(i) through (b)(v) above and
        to
        distribute such amount to the holders of the Class B Notes;

       

      (vii)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class C Notes for
        a Distribution Date exceeds the amount distributed to the holders of the
        Class C
        Notes on such Distribution Date, the Administrator shall instruct the Indenture
        Trustee in writing to withdraw from the Reserve Account on such Distribution
        Date an amount equal to such excess, to the extent of funds available therein
        after giving effect to paragraphs (b)(i) through (b)(vi) above, and to
        distribute such amount to the holders of the Class C Notes entitled thereto;
        provided,
        however,
        that if
        the Liquidity Note Commitment exceeds $0 and the Liquidity Provider is not
        in
        default under the Liquidity Note Agreement, the Administrator will not instruct
        the Indenture Trustee to withdraw amounts from the Reserve Account that would
        cause the amount of funds then remaining in the Reserve Account to be less
        than
        the Reserve Account Minimum Balance.

       

      (viii)  If
        on the
        Final Maturity Date for the Class C Notes, the outstanding principal balance
        of
        the Class C Notes (prior to giving effect to any distribution of principal
        thereon on such date) exceeds the amount of principal distributed to the
        holders
        of the Class C Notes on such date, the Administrator shall instruct the
        Indenture Trustee in writing on such date to withdraw from the Reserve Account
        on such date an amount equal to such excess, to the extent of funds available
        therein, after giving effect to paragraphs (b)(i) through (b)(vii) above
        and to
        distribute such amount to the holders of the Class C Notes;

       

      (ix)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class D Notes for
        a Distribution Date exceeds the amount distributed to the holders of the
        Class D
        Notes on such Distribution Date, the Administrator shall instruct the Indenture
        Trustee in writing to withdraw from the Reserve Account on such Distribution
        Date an amount equal to such excess, to the extent of funds available therein
        after giving effect to paragraphs (b)(i) through (b)(viii) above, and to
        distribute such amount to the holders of the Class D Notes entitled thereto;
        provided,
        however,
        that if
        the Liquidity Note Commitment exceeds $0 and the Liquidity Provider is not
        in
        default under the Liquidity Note Agreement, the Administrator will not instruct
        the Indenture Trustee to withdraw amounts from the Reserve Account that would
        cause the amount of funds then remaining in the Reserve Account to be less
        than
        the Reserve Account Minimum Balance.

       

      (x)  If
        on the
        Final Maturity Date for the Class D Notes, the outstanding principal balance
        of
        the Class D Notes (prior to giving effect to any distribution of principal
        thereon on such date) exceeds the amount of principal distributed to the
        holders
        of the Class D Notes on such date, the Administrator shall instruct the
        Indenture Trustee in writing on such date to withdraw from the Reserve Account
        on such date an amount equal to such excess, to the extent of funds available
        therein, after giving effect to paragraphs (b)(i) through (b)(ix) above and
        to
        distribute such amount to the holders of the Class D Notes;

       

      (c)  If
        on any
        Distribution Date on which the Liquidity Note Commitment equals $0 and the
        amount on deposit in the Reserve Account on such Distribution Date (without
        giving effect to all deposits or withdrawals therefrom on such Distribution
        Date) is greater than the Required Reserve Amount for such Distribution Date,
        the Administrator shall instruct the Indenture Trustee in writing to deposit
        the
        amount of such excess into the Collection Account for distribution on such
        Distribution Date. 

       

      (d)  If
        on any
        Distribution Date the
        amount on deposit in the Reserve Account (without
        giving effect to all deposits or withdrawals therefrom on such Distribution
        Date) is equal to or greater than the aggregate Outstanding Amount of all
        Notes
        and the Liquidity Note Balance, the Administrator shall instruct the Indenture
        Trustee in writing to deposit all amounts in the Reserve Account into the
        Collection Account for distribution on such Distribution Date.

       

      (e)  If
        the
        amounts payable for any Distribution Date pursuant to paragraphs (b)(i) through
        (b)(ix) above exceed (i) the amount of the Liquidity Note Commitment on such
        Distribution Date together with (ii) the amounts on deposit in the Reserve
        Account in excess of the Reserve Account Minimum Balance, the Administrator
        shall instruct the Indenture Trustee in writing to withdraw from the Reserve
        Account an amount equal to such excess depleting the funds in the Reserve
        Account below the Reserve Account Minimum Balance.

       

      SECTION
        8.09  Statements
        to Noteholders.
        On each
        Determination Date preceding a Distribution Date, pursuant to the Administration
        Agreement the Administrator shall provide to the Indenture Trustee (with
        a copy
        to the Owner Trustee and the Rating Agencies) for the Indenture Trustee to
        forward on such succeeding Distribution Date to each holder of record of
        the
        Notes and the Liquidity Provider a statement setting forth at least the
        following information as to the Notes, to the extent applicable:

       

      (1)  the
        amount of the distribution allocable to principal of each Class of
        Notes;

       

      (2)  the
        amount of the distribution allocable to interest on each Class of Notes
        (including, with respect to the Class B Notes, the Class C Notes and the
        Class D
        Notes, the portion allocable to Noteholders’ Interest Carryover Shortfall),
        together with the interest rates applicable with respect thereto;

       

      (3)  the
        Pool
        Balance as of the close of business on the last day of the preceding Collection
        Period, after giving effect to the related payments allocated to principal
        reported under clause (1) above;

       

      (4)  the
        aggregate outstanding principal balance of each Class of Notes as of such
        Distribution Date, after giving effect to related payments allocated to
        principal reported under clause (1) above;

       

      (5)  for
        each
        Distribution Date (A) the amount of fees and expenses paid to the Indenture
        Trustee and the Owner Trustee; (B) the amount of the Servicing Fee and expenses
        paid to the Servicers; (C) the amount of fees paid to TERI; (D) the amount
        of
        the Administration Fee and expenses paid to the Administrator, (E) the amount
        of
        the Back-Up Administration Fee and expenses paid to the Back-Up Administrator,
        and (F) the amount of the fees and expenses payable to the Liquidity Provider,
        and, in each case, with respect to such Collection Period, together with
        the
        amount, if any, remaining unpaid after giving effect to all such
        payments;

       

      (6)  for
        each
        Distribution Date, the amount of the aggregate Realized Losses for the Financed
        Student Loans, if any, for such Collection Period and the balance of the
        Financed Student Loans that are delinquent in each delinquency period as
        of the
        end of such Collection Period;

       

      (7)  the
        balance of the Reserve Account on such Distribution Date, after giving effect
        to
        changes therein on such Distribution Date;

       

      (8)  the
        amounts withdrawn from the Reserve Account on such Distribution Date;

       

      (9)  the
        amounts drawn under the Liquidity Note Agreement on such Distribution
        Date;

       

      (10)  the
        Liquidity Note Commitment;

       

      (11)  the
        amount of the distribution allocable to interest on the Liquidity
        Note;

       

      (12)  the
        amount of the distribution allocable to principal on the Liquidity Note;
        

       

      (13)  the
        Liquidity Note Balance as of such Distribution Date, after giving effect
        to
        draws under the Liquidity Note Agreement and payments allocated to principal
        reported under clause (12) above;

       

      (14)  the
        amount of any Advance with respect to such Distribution Date;

       

      (15)  the
        amount transferred to the TERI Pledge Fund to acquire Rehabilitated Student
        Loans with respect to such Distribution Date; and

       

      (16)  the
        amount of the distribution allocable to Prepayment Penalties.

       

      Each
        amount set forth pursuant to clauses (1), (2), (3), (5) and (6) above shall
        be expressed as a dollar amount. A copy of the statements referred to above
        may
        be obtained by any Note Owner by a written request to the Indenture Trustee
        addressed to the Corporate Trust Office.

       

      SECTION
        8.10  Liquidity
        Note Agreement.
        (a)
        On the
        Closing Date, the Issuer and the Indenture Trustee shall enter into the
        Liquidity Note Agreement with the Liquidity Provider. In connection therewith,
        the Issuer shall execute and deliver to the Liquidity Provider a liquidity
        note
        (the “Liquidity Note”) in an aggregate maximum amount outstanding at any time
        not to exceed $118,000,000. Such Liquidity Note shall evidence the Issuer’s
        obligation to repay all funded draws made by the Liquidity Provider to the
        Issuer pursuant to the Liquidity Note Agreement, together with interest accrued
        on the outstanding balance of the aggregate of all funded draws in accordance
        with the Liquidity Note Agreement. 

       

      (b)  The
        amount available to be drawn under the Liquidity Note Agreement (the “Liquidity
        Note Commitment”) on the first Distribution Date shall be $118,000,000.
        Thereafter, the Liquidity Note Commitment shall be reduced by amounts drawn
        on
        the Liquidity Note and increased by amounts repaid up to the Liquidity Note
        Commitment; provided,
        however that
        the
        Liquidity Note Commitment shall never be greater on any Distribution Date
        than
        the Liquidity Note Commitment on any preceding Distribution Date, as provided
        in
        the Liquidity Note Agreement. In addition, on each Distribution Date beginning
        with the Distribution Date in February 2007, if the sum of the Liquidity
        Note
        Commitment and the aggregate amount of funds on deposit in the Reserve Account
        exceeds the Required Reserve Amount, the then Liquidity Note Commitment shall
        be
        reduced by the amount of the excess until the Liquidity Note Commitment is
        equal
        to zero; provided that on the January 2015 Distribution Date, the Liquidity
        Note
        Commitment shall be equal to zero. 

       

      (c)  At
        and in
        accordance with the direction of the Administrator, the Indenture Trustee,
        on
        behalf of the Issuer, shall, subject to and pursuant to the terms of the
        Liquidity Note Agreement, request draws under the Liquidity Note up to the
        amount of the Liquidity Note Commitment, as follows: 

       

      (i)  If
        the
        amounts payable on any Distribution Date pursuant to Section 8.02(d)(1) will
        exceed the amount available to be distributed to the applicable parties on
        such
        Distribution Date, after giving effect to all distributions from the Reserve
        Account pursuant to Section 8.08, the Administrator shall instruct the Indenture
        Trustee in writing to draw on the Liquidity Note in accordance with the terms
        of, and within the timeframe set forth in the Liquidity Note Agreement, in
        an
        amount equal to the lesser of (i) such excess and (ii) the remaining Liquidity
        Note Commitment on such Distribution Date, and to distribute or allocate
        such
        amounts to the applicable parties pro rata
        (based
        upon amounts owed to each such party).

       

      (ii)  If
        the
        amounts payable on any Distribution Date pursuant to Section 8.02(d)(2) will
        exceed the amount available to be transferred to the TERI Pledge Fund on
        such
        Distribution Date, after giving effect to all distributions from the Reserve
        Account pursuant to Section 8.08, the Administrator shall instruct the Indenture
        Trustee in writing to draw on the Liquidity Note in accordance with the terms
        of, and within the timeframe set forth in the Liquidity Note Agreement, in
        an
        amount equal to the lesser of (i) such excess and (ii) the remaining Liquidity
        Note Commitment on such Distribution Date, after giving effect to paragraph
        (b)(i) above, and to transfer such amount to the TERI Pledge Fund.

       

      (iii)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class A Notes and
        the interest due on the Liquidity Note Balance for a Distribution Date will
        exceed the amount available to be distributed to the holders of the Class
        A
        Notes and the Liquidity Provider on such Distribution Date, after giving
        effect
        to all distributions from the Reserve Account pursuant to Section 8.08, the
        Administrator shall instruct the Indenture Trustee in writing to draw on
        the
        Liquidity Note in accordance with the terms of, and within the timeframe
        set
        forth in the Liquidity Note Agreement, in an amount equal to the lesser of
        (i)
        such excess and (ii) the remaining Liquidity Note Commitment on such
        Distribution Date, after giving effect to paragraphs (b)(i) through (b)(ii)
        above, and to distribute such amount to the applicable parties pro rata
        (based
        upon the amounts then owed to each such party).

       

      (iv)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class B Notes for
        a Distribution Date will exceed the amount available to be distributed to
        the
        holders of the Class B Notes on such Distribution Date, after giving effect
        to
        all distributions from the Reserve Account pursuant to Section 8.08, the
        Administrator shall instruct the Indenture Trustee in writing to draw on
        the
        Liquidity Note in accordance with the terms of, and within the timeframe
        set
        forth in the Liquidity Note Agreement, in an amount equal to the lesser of
        (i)
        such excess and (ii) the remaining Liquidity Note Commitment on such
        Distribution Date, after giving effect to paragraphs (b)(i) through (b)(iii)
        above, and to distribute such amount to the holders of the Class B Notes
        entitled thereto.

       

      (v)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class C Notes for
        a Distribution Date will exceed the amount available to be distributed to
        the
        holders of the Class C Notes on such Distribution Date, after giving effect
        to
        all distributions from the Reserve Account pursuant to Section 8.08, the
        Administrator shall instruct the Indenture Trustee in writing to draw on
        the
        Liquidity Note in accordance with the terms of, and within the timeframe
        set
        forth in the Liquidity Note Agreement, in an amount equal to the lesser of
        (i)
        such excess and (ii) the remaining Liquidity Note Commitment on such
        Distribution Date, after giving effect to paragraphs (b)(i) through (b)(iv)
        above, and to distribute such amount to the holders of the Class C Notes
        entitled thereto.

       

      (vi)  If
        the
        Noteholders’ Interest Distribution Amount with respect to the Class D Notes for
        a Distribution Date will exceed the amount available to be distributed to
        the
        holders of the Class D Notes on such Distribution Date, after giving effect
        to
        all distributions from the Reserve Account pursuant to Section 8.08, the
        Administrator shall instruct the Indenture Trustee in writing to draw on
        the
        Liquidity Note in accordance with the terms of, and within the timeframe
        set
        forth in the Liquidity Note Agreement, in an amount equal to the lesser of
        (i)
        such excess and (ii) the remaining Liquidity Note Commitment on such
        Distribution Date, after giving effect to paragraphs (b)(i) through (b)(v)
        above, and to distribute such amount to the holders of the Class D Notes
        entitled thereto.

       

      (vii)  In
        the
        event of a Ratings Downgrade (as defined in Section 2.5 of the Liquidity
        Note
        Agreement), then, within 10 days thereafter, the Administrator shall be required
        to cause (and the Indenture Trustee shall sign all documents and take such
        actions as the Administrator shall reasonably request), subject to a Rating
        Agency Condition, the Issuer to cause the Liquidity Provider to enter into
        a
        guaranty agreement with a Liquidity Facility Guarantor meeting the requirements
        of Section 2.5 of the Liquidity Note Agreement for the funding of all subsequent
        draws thereunder. In the event the Liquidity Provider fails to fund any draw
        request, such Liquidity Facility Guarantor shall, after notice from the
        Liquidity Provider, and pursuant to the terms of the Liquidity Note Agreement
        and of such guaranty agreement, fund such draw request and all subsequent
        draw
        requests. If the Liquidity Facility Guarantor fails to perform in accordance
        with its obligations under any such guaranty agreement or in the event the
        ratings of the Liquidity Facility Guarantor fall below those specified in
        Section 2.5 of the Liquidity Note Agreement, with prompt written notice to
        the
        Rating Agencies, the Administrator shall be required to cause the Issuer
        within
        10 days thereof to (i) subject to a Rating Agency Condition, replace such
        Liquidity Facility Guarantor with another Liquidity Facility Guarantor meeting
        the requirements of Section 2.5 of the Liquidity Note Agreement, (ii) replace
        the Liquidity Provider with a similar provider whose
        short-term unsecured debt ratings are F1+ by Fitch, A-1+ by S&P and P-1 by
        Moody’s or
        (iii)
        if no substitute liquidity provider can be obtained on terms substantially
        similar to those contained in the Liquidity Note Agreement, demand payment
        in
        accordance with Section 2.2(a) of the Liquidity Note Agreement of the entire
        undrawn amount of the Liquidity Note Commitment available on the related
        Distribution Date. Any such amount received shall be deposited in the Reserve
        Account. 

       

      SECTION
        8.11  Advances.
        (a)
        On or
        prior to any Distribution Date, a Certificateholder may, but shall not be
        obligated to, make an optional deposit (each, an “Optional Deposit”) to the
        Reserve Account from funds to be released to such Certificateholder pursuant
        to
        Section 8.02(d)(17) on such Distribution Date or otherwise. Any such Optional
        Deposit shall be applied on the related Distribution Date in the same manner
        as
        other funds on deposit in the Reserve Account on the related Distribution
        Date
        in accordance with Section 8.08.

       

      (b)  If
        on any
        Determination Date the amount required to be distributed on the upcoming
        Distribution Date pursuant to Section 8.02(d)(1), would exceed the sum of
        the
        aggregate amount in the Collection Account, the Reserve Account and the
        Liquidity Note Commitment, the Administrator, in its sole option, may elect
        to
        deposit, or have an Affiliate deposit, in the Reserve Account (no later than
        the
        Business Day immediately preceding such Distribution Date) an amount up to
        the
        amount of such deficiency (such deposit, is referred to as an
“Advance”).

       

      ARTICLE
        IX

       

      Supplemental
        Indentures

       

      SECTION
        9.01  Supplemental
        Indentures Without Consent of Noteholders.
        (a)
        Without
        the consent of any holders of the Notes but with prior notice to the Rating
        Agencies, the Issuer and the Indenture Trustee, when authorized by an Issuer
        Order, at any time and from time to time, may enter into one or more indentures
        supplemental hereto, 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 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 or supplement any provision herein or in any
        supplemental indenture which may be inconsistent with any other provision
        herein
        or in any supplemental indenture or 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 adversely affect
        the
        interests of the holders of the Notes; or

       

      (vi)  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.

       

      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
        Administrator, on behalf of the Issuer and the Indenture Trustee, when
        authorized by an Issuer Order, may, also without the consent of any of the
        holders of the Notes but upon satisfying the Rating Agency Condition, 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, including 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, adversely affect
        in any material respect the interests of any holder of the Notes or the
        Liquidity Provider.

       

      SECTION
        9.02  Supplemental
        Indentures with Consent of Noteholders.
        The
        Issuer and the Indenture Trustee, when authorized by an Issuer Order, also
        may,
        with prior notice to the Rating Agencies, and with the consent of the Interested
        Noteholders holding a majority of the Outstanding Amount of the related Classes
        of Notes, 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 no
        such supplemental indenture shall, without the consent of the holder of each
        Outstanding Note affected thereby and the Liquidity Provider:

       

      (i)  change
        the date of payment of any installment of principal of or interest on each
        Class
        of Notes, or reduce the principal amount thereof or the interest rate thereon,
        or amounts due the Liquidity Provider under the Liquidity Note Agreement,
        change
        the provisions of this Indenture relating to the application of collections
        on,
        or the proceeds of the sale of, the Indenture Trust Estate to payment of
        principal of or interest on the applicable Notes, or amounts due the Liquidity
        Provider under the Liquidity Note Agreement, or change any place of payment
        where, or the coin or currency in which, any Note, or the interest thereon,
        or
        amounts due the Liquidity Provider under the Liquidity Note Agreement, 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, or amounts due the Liquidity Provider under the Liquidity Note Agreement,
        on or after the respective due dates thereof;

       

      (ii)  reduce
        the percentage of the Outstanding Amount of the Notes, the consent of the
        holders of which is required for any such supplemental indenture, or the
        consent
        of the holders of the Notes 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”;

       

      (iv)  reduce
        the percentage of the Outstanding Amount of the Notes required to direct
        the
        Indenture Trustee to direct the Issuer to sell or liquidate the Indenture
        Trust
        Estate pursuant to Section 5.04;

       

      (v)  modify
        any provision of this Section except to increase any percentage specified
        herein
        or to provide that certain additional provisions of this Indenture or the
        other
        Basic Documents cannot be modified or waived without the consent of the holder
        of each Outstanding 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
        applicable Note on any Distribution Date (including the calculation of any
        of
        the individual components of such calculation);

       

      (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 Indenture 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 any holder of any Note
        of
        the security provided by the lien of this Indenture; or

       

      (viii)  change
        the definition of Interested Noteholders.

       

      It
        shall
        not be necessary for any Act of holders of the Notes under this Section 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, the Indenture Trustee shall mail to the
        holders of the Notes to which such amendment or supplemental indenture relates
        and the Liquidity Provider a notice prepared by the Issuer 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.

       

      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 modifications 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 that
        all
        conditions precedent to the execution and delivery thereof have been satisfied.
        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 be deemed to be modified and amended in accordance
        therewith, 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 and the Liquidity Provider
        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  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.

       

      SECTION
        9.06  Conformity
        With the Trust Indenture Act.
        Every
        Supplemental Indenture executed pursuant to this Article IX shall conform
        to the requirements of the TIA as then in effect.

       

      ARTICLE
        X

       

      Reporting
        Requirements

       

      SECTION
        10.01  Annual
        Statement as to Compliance.
        The
        Issuer will cause each Servicer to deliver to the Administrator, any applicable
        annual statements as to compliance required by such Servicer’s Servicing
        Agreement. Copies of any such annual statements will be provided to the Rating
        Agencies rating the Notes.

       

      SECTION
        10.02  Annual
        Independent Public Accountants’ Servicing Report.
        The
        Issuer shall cause each Servicer to cause a firm of independent public
        accountants to furnish a statement to the Administrator and the Indenture
        Trustee in accordance with such Servicer’s Servicing Agreement. So long as the
        Issuer is required to file reports with the SEC pursuant to Section 15(d)
        of the
        Exchange Act, the Issuer shall cause each Servicer that is required to provide
        an assessment of compliance and an attestation report pursuant to Item 1122
        of
        Regulation AB to furnish such items to the Administrator and the Indenture
        Trustee in sufficient time to permit the Issuer to file in a timely manner
        with
        the SEC all reports required to be filed by the Issuer pursuant to Section
        15(d)
        of the Exchange Act. The Issuer shall cause copies of each document delivered
        pursuant to this Section 10.02 to be provided to the Rating Agencies rating
        the
        Notes.

       

      SECTION
        10.03  Assessment
        of Compliance and Attestation Reports.

       

      (a)  Assessment
        of Compliance.

       

      (i)  By
        September 15 of each year, commencing in September 2007, the Indenture Trustee
        shall furnish to the Depositor and the Administrator, a report on an assessment
        of compliance with the Relevant Servicing Criteria that contains (A) a statement
        by such party of its responsibility for assessing compliance with the Relevant
        Servicing Criteria, (B) a statement that such party used the Servicing Criteria
        to assess compliance with the Relevant Servicing Criteria, (C) such party’s
        assessment of compliance with the Relevant Servicing Criteria as of and for
        the
        fiscal year covered by the Form 10-K required to be filed pursuant to Section
        3.24, including, if there has been any material instance of noncompliance
        with
        the Relevant Servicing Criteria, a discussion of each such failure and the
        nature and status thereof, and (D) a statement that a registered public
        accounting firm has issued an attestation report on such party’s assessment of
        compliance with the Relevant Servicing Criteria as of and for such
        period.

       

      (ii)  When
        the
        Indenture Trustee submits its assessment to the Depositor and the Administrator,
        it will also at such time include the assessment (and attestation pursuant
        to
        subsection (b) of this Section 10.03) of each Servicing Function Participant
        engaged by it and shall indicate what Relevant Servicing Criteria will be
        addressed in any such reports prepared by any such Servicing Function
        Participant.

       

      (iii)  Promptly
        after receipt of each report on assessment of compliance, the Administrator
        shall confirm that the assessments, taken as a whole, address all applicable
        Servicing Criteria and taken individually address the Relevant Servicing
        Criteria (and disclose the inapplicability of the Servicing Criteria not
        determined to be Relevant Servicing Criteria) for each party as set forth
        on
        Exhibit C attached hereto and on any similar exhibit set forth in the applicable
        Servicing Agreement in respect of any Servicer, and the applicable Custodial
        Agreement, and shall notify the Depositor of any exceptions.

       

      (b)  Attestation
        Reports.

       

      (i)  By
        September 15 of each year, commencing in September 2007, the Indenture Trustee
        shall cause, and shall cause any Servicing Function Participant engaged by
        it to
        cause, a registered public accounting firm (which may also render other services
        to the Administrator and the Indenture Trustee, as the case may be) that
        is a
        member of the American Institute of Certified Public Accountants to furnish
        a
        report to the Depositor and the Administrator, to the effect that (A) it
        has
        obtained a representation regarding certain matters from the management of
        such
        party, which includes an assertion that such party has complied with the
        Relevant Servicing Criteria, and (B) on the basis of an examination conducted
        by
        such firm in accordance with standards for attestation engagements issued
        or
        adopted by the Public Company Accounting Oversight Board, it is expressing
        an
        opinion as to whether such party’s compliance with the Relevant Servicing
        Criteria was fairly stated in all material respects, or it cannot express
        an
        overall opinion regarding such party’s assessment of compliance with the
        Relevant Servicing Criteria. In the event that an overall opinion cannot
        be
        expressed, such registered public accounting firm shall state in such report
        why
        it was unable to express such an opinion. Such report must be available for
        general use and not contain restricted use language.

       

      (ii)  Promptly
        after receipt of such report from the Indenture Trustee or any Servicing
        Function Participant engaged by it, the Administrator shall confirm that
        each
        assessment submitted pursuant subsection (a) of this Section 10.03 is coupled
        with an attestation meeting the requirements of this Section and notify the
        Depositor of any exceptions.

       

      (c)  The
        Indenture Trustee’s obligation to provide assessments of compliance and
        attestations under this Section 10.03 shall terminate upon the filing of
        a Form
        15 suspension notice on behalf of the Issuer; provided,
        however
        that the
        Indenture Trustee shall provide assessments of compliance and attestations
        for
        the first fiscal year of the Issuer. After the occurrence of such event,
        and
        provided the Depositor is not otherwise provided with such reports or copies
        of
        such reports, the Indenture Trustee shall no longer be obligated to provide
        a
        copy of such reports to the Depositor or the Administrator.

       

      (d)  The
        scope
        of the “platform” to be used for the assessment of compliance and attestation
        reports shall be limited to all securities offered after January 1, 2006
        involving the Indenture Trustee as the asserting party that are backed by
        student loans.

       

      (e)  Notwithstanding
        anything contained in Exhibit C to the contrary, the Indenture Trustee shall
        be
        entitled to deposit payments on Financed Student Loans in the appropriate
        custodial bank accounts and related bank clearing accounts no more than five
        Business Days following receipt, in accordance with Section 1122(d)(2)(i)
        of the
        Relevant Servicing Criteria.

       

      (f)  Each
        of
        the parties hereto acknowledges and agrees that the purpose of this Section
        10.03 is to facilitate compliance by the Issuer with the provisions of
        Regulation AB, as such may be amended or clarified from time to time. Therefore,
        each of the parties agrees that the Indenture Trustee’s obligations hereunder
        will be supplemented and modified as necessary to be consistent with any
        such
        amendments, interpretive advice or guidance, convention or consensus among
        active participants in the asset-backed securities markets, advice of counsel
        or
        otherwise in respect of the requirements of Regulation AB and the Indenture
        Trustee shall comply with requests made by the Administrator, on behalf of
        the
        Issuer, for delivery of additional or different information as the
        Administrator, on behalf of the Issuer, may determine in good faith is necessary
        to comply with the provisions of Regulation AB, provided that such information
        is available without unreasonable effort or expense and within such timeframe
        as
        may be reasonably requested.

       

      ARTICLE
        XI

       

      Miscellaneous

       

      SECTION
        11.01  Compliance
        Certificates and Opinions, etc.
        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 (i) an Officers’ Certificate of the Issuer 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:

       

      (i)  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;

       

      (ii)  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;

       

      (iii)  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; and

       

      (iv)  a
        statement as to whether, in the opinion of each such signatory, such condition
        or covenant has been complied with.

       

      SECTION
        11.02  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 a Servicer,
        the
        Issuer or the Administrator, stating that the information with respect to
        such
        factual matters is in the possession of such Servicer, the Issuer or the
        Administrator, 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
        11.03  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 holders of the
        Notes
        may be embodied in and evidenced by one or more instruments of substantially
        similar tenor signed by such holders of the Notes, 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 holders
        of the Notes, 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.

       

      (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 Register.

       

      (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
        11.04  Notices,
        etc., to Indenture Trustee, Issuer and Rating Agencies.
        Any
        request, demand, authorization, direction, notice, consent, waiver or Act
        of
        holders of Notes, 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 holders of Notes, is to be made upon, given
        or
        furnished to or filed with:

       

      (a)  the
        Indenture Trustee by any holder of Notes, 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 its Corporate Trust Office.

       

      (b)  the
        Issuer by the Indenture Trustee or by any holder of Notes shall be sufficient
        for every purpose hereunder if in writing and mailed, first-class, postage
        prepaid, to the Issuer addressed to: The National Collegiate Student Loan
        Trust
        2006-3, c/o Wilmington Trust Company, as Owner Trustee, 1100 North Market
        Street, Wilmington, DE 19890, Attention: Corporate Trust Administration;
        with a
        copy to: The First Marblehead Corporation, The Prudential Tower, 800 Boylston
        Street, 34th Floor, Boston, Massachusetts 02199-8157, Attention: Controller,
        with a copy to: Corporate Law Department, or at any other address previously
        furnished in writing to the Indenture Trustee by the Issuer or the
        Administrator. The Issuer shall promptly transmit any notice received by
        it from
        the holders of the Notes to the Indenture Trustee.

       

      (c)  the
        Liquidity Provider shall be sufficient for every purpose hereunder if made,
        given, furnished or filed in writing to or with the Liquidity Provider at
        the
        address set forth in the Liquidity Note Agreement, or such other address
        as
        shall be designated by the Liquidity Provider by written notice to the other
        parties.

       

      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, electronically
        delivered, or mailed by certified mail, return receipt requested, and shall
        be
        deemed to have been duly given upon receipt (i) in the case of Moody’s, via
        electronic delivery to “servicerreports@moodys.com”, and for any information not
        available in electronic format, send hard copies to: Moody’s Investors Service,
        Inc., ABS Monitoring Department, 99 Church Street, New York, New York 10007;
        (ii) in the case of Standard & Poor’s, via electronic delivery to
“Servicer_reports@sandp.com” and for any information not available in electronic
        format, send hard copies to: Standard & Poor’s Ratings Services, 55 Water
        Street, 41st floor, New York, New York 10041-0003, Attention: ABS Surveillance
        Group; (iii) in the case of Fitch, via electronic delivery to
“surveillance-abs-consumer@fitchratings.com” and for any information not
        available in electronic format, send hard copies to: Fitch Ratings, One State
        Street Plaza, New York, NY 10004, Attention: ABS Surveillance Group; or as
        to
        each of the foregoing, at such other address as shall be designated by written
        notice to the other parties.

       

      SECTION
        11.05  Notices
        to Noteholders; Waiver.
        Where
        this Indenture provides for notice to holders of Notes 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 holder of Notes
        affected by such event, at his 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 holders of the
        Notes
        is given by mail, neither the failure to mail such notice nor any defect
        in any
        notice so mailed to any particular holder of Notes shall affect the sufficiency
        of such notice with respect to other holders of Notes, and any notice that
        is
        mailed in the manner herein provided shall conclusively be presumed to have
        been
        duly given.

       

      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 holders of the Notes 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 holders of the Notes 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 a Default.

       

      SECTION
        11.06  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 the
        Notes
        providing for a method of payment, or notice by the Indenture Trustee or
        any
        Paying Agent to such holder of the Notes that is different from the methods
        provided for in this Indenture for such payments or notices. The Issuer will
        furnish to the Indenture Trustee a copy of each such agreement and the Indenture
        Trustee will cause payments to be made and notices to be given in accordance
        with such agreements.

       

      SECTION
        11.07  Effect
        of Headings and Table of Contents.
        The
        Article and Section headings herein and the Table of Contents are for
        convenience only and shall not affect the construction hereof.

       

      SECTION
        11.08  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 the successors, co-trustees
        and agents (excluding any legal representatives or accountants) of the Indenture
        Trustee.

       

      SECTION
        11.09  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
        11.10  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 holders
        of
        the Notes, and any other party secured hereunder (including the Liquidity
        Provider) and any other Person with an ownership interest in any part of
        the
        Indenture Trust Estate, any benefit or any legal or equitable right, remedy
        or
        claim under this Indenture.

       

      SECTION
        11.11  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
        11.12  Governing
        Law.
        THIS
        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 SHALL BE DETERMINED IN ACCORDANCE
        WITH SUCH LAWS. THIS INDENTURE IS SUBJECT TO THE PROVISIONS OF THE TIA THAT
        ARE
        REQUIRED TO BE PART OF THIS INDENTURE AND SHALL, TO THE EXTENT APPLICABLE,
        BE
        GOVERNED BY SUCH PROVISIONS.

       

      SECTION
        11.13  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
        11.14  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 (which may be counsel to the Indenture Trustee or any
        other counsel reasonably acceptable to the Indenture Trustee) to the effect
        that
        such recording is necessary either for the protection of the holders of the
        Notes or any other Person secured hereunder or for the enforcement of any
        right
        or remedy granted to the Indenture Trustee under this Indenture.

       

      SECTION
        11.15  Trust
        Obligations.
        No
        recourse may be taken, directly or indirectly, with respect to the obligations
        of the Issuer, the Administrator, the Back-up Administrator, any Servicer,
        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 Administrator, the Back-up Administrator, such Servicer,
        the
        Indenture Trustee or the Owner Trustee in its individual capacity or (ii)
        any
        partner, owner, beneficiary, agent, officer, director, employee or agent
        of the
        Administrator, the Back-up Administrator, such Servicer, the Indenture Trustee
        or the Owner Trustee in its individual capacity, any holder or owner of a
        beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee
        or
        of any successor or assign of the Administrator, the Back-up Administrator,
        a
        Servicer, the Liquidity Provider, 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 individual capacity) 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.

       

      This
        Indenture is executed and delivered by Wilmington Trust Company (“WTC”), not
        individually or personally but solely as Owner Trustee of the Issuer in the
        exercise of the powers and authority conferred and vested in it and each
        of the
        representations, undertakings and agreements herein made on the part of the
        Issuer is made and intended not as a personal representation, undertaking
        and
        agreement by WTC but is made and intended for the purpose of binding only
        the
        Issuer and under no circumstances shall WTC be personally liable for the
        payment
        of any indebtedness or expenses of the Issuer or be liable for the breach
        or
        failure of any obligation, representation, warranty or covenant made or
        undertaken by the Issuer under this Indenture or otherwise.

       

      SECTION
        11.16  No
        Petition.
        The
        Indenture Trustee, by entering into this Indenture, and each holder of each
        Class of the Notes, by accepting a Note, hereby covenant and agree that they
        will not at any time institute against the Issuer, or join in any institution
        against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency,
        receivership 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 other Basic
        Documents.

       

      SECTION
        11.17  Inspection.
        The
        Issuer agrees that, on reasonable prior notice, it will 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 obtained
        from such examination or inspection 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.

       

      SECTION
        11.18  Third-Party
        Beneficiaries.
        This
        Indenture will inure to the benefit of and be binding upon the parties hereto,
        the Owner Trustee, the Noteholders, the Note Owners, the Liquidity Provider,
        TERI and their respective successors and permitted assigns. Except as otherwise
        provided in this Indenture, no other person will have any right or obligation
        hereunder.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused this Indenture
        to be duly executed by their respective officers, thereunto duly authorized
        and
        duly attested, all as of the day and year first above written.

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY,

                not
                  in its individual capacity but solely as Owner Trustee

                 

              
	
                By:

              	
                /s/
                  J. Christopher Murphy

              
	
                Name:

              	
                J.
                  Christopher Murphy

              
	
                Title:

              	
                Financial
                  Services Officer

              
	 
	 
	
                U.S.
                  BANK NATIONAL ASSOCIATION, 

                not
                  in its individual capacity but solely

                as
                  Indenture Trustee

              
	 	 
	
                By:

              	
                /s/
                  Karen Beard

              
	
                Name:

              	
                Karen
                  Beard

              
	
                Title:

              	
                Vice
                  President

              

      

      

      

      
        
          
            

            

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
          

        

      

      
        	
                STATE
                  OF DELAWARE

              	
                )

              	 
	 	
                )

              	
                ss.:

              
	
                COUNTY
                  OF NEW CASTLE

              	
                )

              	 

      

      

      

      

      On
        the
        22nd day of September in the year 2006, before me, the undersigned, personally
        appeared J. Christopher Murphy, an Authorized Officer, of WILMINGTON TRUST
        COMPANY, as Owner Trustee of THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3,
        personally known to me or proved to me on the basis of satisfactory evidence
        to
        be the individual whose name is subscribed to the within instrument and
        acknowledged to me that he executed the same in his capacity, and that by
        his
        signature on the instrument, the individual, or the person upon behalf of
        which
        the individual acted, executed the instrument.

       

      GIVEN
        UNDER MY HAND AND SEAL OF OFFICE, this 22nd day of September 2006.

       

      

      
        	
                /s/
                  Amanda E. Burger

              
	
                Notary
                  Public in and for

              
	
                the
                  State of Delaware.

              

      

      

      My
        commission expires: 

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                COMMONWEALTH
                  OF MASSACHUSETTS

              	
                 
                  )

              	 
	 	
                 
                  )

              	
                ss.:

              
	
                COUNTY
                  OF SUFFOLK

              	
                 
                  )

              	 

      

      

      

      On
        the
        28th day of September
        in
        the
        year 2006, before me, the undersigned, personally appeared Karen Beard, a
        Vice
        President of U.S. BANK NATIONAL ASSOCIATION, personally known to me or proved
        to
        me on the basis of satisfactory evidence to be the individual whose name
        is
        subscribed to the within instrument and acknowledged to me that he executed
        the
        same in his capacity, and that by his signature on the instrument, the
        individual, or the person upon behalf of which the individual acted, executed
        the instrument.

       

      GIVEN
        UNDER MY HAND AND SEAL OF OFFICE, this 28th day of September 2006.

       

      

      
        	
                /s/
                  Winnie L. Chen

              
	
                Notary
                  Public in and for

              
	
                the
                  State of Massachusetts.

              

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      APPENDIX
        A

       

      DEFINITIONS
        AND USAGE

       

      Usage

       

      The
        following rules of construction and usage shall be applicable to any instrument
        that is governed by this Appendix:

       

      (a)  All
        terms
        defined in this Appendix shall have the defined meanings when used in any
        instrument governed hereby and in any certificate or other document made
        or
        delivered pursuant thereto unless otherwise defined therein.

       

      (b)  As
        used
        herein, in any instrument governed hereby and in any certificate or other
        document made or delivered pursuant thereto, accounting terms not defined
        in
        this Appendix or in any such instrument, certificate or other document, and
        accounting terms partly defined in this Appendix or in any such instrument,
        certificate or other document to the extent not defined, shall have the
        respective meanings given to them under generally accepted accounting principles
        as in effect on the date of such instrument. To the extent that the definitions
        of accounting terms in this Appendix or in any such instrument, certificate
        or
        other document are inconsistent with the meanings of such terms under generally
        accepted accounting principles, the definitions contained in this Appendix
        or in
        any such instrument, certificate or other document shall control.

       

      (c)  The
        words
“hereof,” “herein,” “hereunder” and words of similar import when used in an
        instrument refer to such instrument as a whole and not to any particular
        provision or subdivision thereof; references in an instrument to “Article,”
“Section” or another subdivision or to an attachment are, unless the context
        otherwise requires, to an article, section or subdivision of or an attachment
        to
        such instrument; and the term “including” means “including without
        limitation.”

       

      (d)  The
        definitions contained in this Appendix are equally applicable to both the
        singular and 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 below or in any
        agreement or instrument that is governed by this Appendix means such agreement
        or instrument or statute as from time to time amended, modified or supplemented,
        including (in the case of agreements or instruments) by waiver or consent
        and
        (in the case of statutes) by succession of comparable successor statutes
        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.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      Definitions

       

      “Accountant”
means
        PricewaterhouseCoopers LLP and any other independent certified public accountant
        as may be selected by
        the
        Issuer and satisfying the Rating Agency Condition.

       

      “Act”
has
        the
        meaning specified in Section 11.03(a) of the Indenture.

       

      “Administration
        Agreement”
means
        the Administration Agreement dated as of September 28, 2006, among the Issuer,
        the Indenture Trustee, the Owner Trustee, the Depositor and the
        Administrator.

       

      “Administration
        Fee”
has
        the
        meaning specified in Section 3 of the Administration
        Agreement.

       

      “Administrator”
means
        First Marblehead Data Services, Inc., a Massachusetts corporation, in its
        capacity as administrator of the Issuer and the Financed Student Loans, and
        its
        successors and permitted assigns.

       

      “Administrator
        Default”
means
        the occurrence of any event specified in Section 8(d) of the Administration
        Agreement.

       

      “Advance”
has
        the
        meaning specified in Section 8.10(b) of the Indenture.

       

      “Affiliate”
means,
        with respect to any specified Person, any other Person controlling or controlled
        by or under common control with such specified Person. For the purposes of
        this
        definition, “control” when used with respect to any specified Person means the
        power to direct the management and policies of such Person, directly or
        indirectly, whether through the ownership of voting securities, by contract
        or
        otherwise; and the terms “controlling” and “controlled” have meanings
        correlative to the foregoing.

       

      “Applicable
        Index”
means
        with respect to each Class of Notes (other than the Class A-IO Notes), One-Month
        LIBOR; provided,
        however,
        with
        respect to the initial Interest Period, the Applicable Index shall be determined
        by the following formula:

       

      X
        + 30/31
        * (Y-X)

       

      Where:
        X
        = One-Month LIBOR, and

       

      Y
        =
        Two-Month LIBOR, in each case, as of the second Business Day before the start
        of
        the initial Interest Period.

       

      “Applicable
        Note Margin”
means
        0.03% for the Class A-1 Notes, 0. 11 % for the Class A-2 Notes, 0.15% for
        the
        Class A-3 Notes, 0.27% for the Class A-4 Notes, 0.32% for the Class A-5 Notes,
        0.36% for the Class B Notes, 0.47% for the Class C Notes, and 1.15% for the
        Class D Notes.

       

      “Authorized
        Officer”
means,
        with respect to any Person, any Person who is authorized to act for such
        Person
        in matters relating to the Basic Documents and whose action is binding upon
        such
        Person. With the respect to the Issuer, “Authorized Officer” means any officer
        of the Owner Trustee and/or the Administrator who is authorized to act for
        the
        Owner Trustee and/or the Administrator in matters relating to the Issuer.
        With
        respect to the Indenture Trustee, “Authorized Officer” means any officer of the
        Indenture Trustee customarily performing functions similar to those performed
        by
        any of the above designated officers and also, with respect to a particular
        matter, any other officer to whom such matter is referred because of such
        officer’s knowledge of and familiarity with the particular subject.

       

      “Available
        Funds”
means,
        with respect to any Distribution Date, the sum of the following amounts received
        with respect to the preceding Collection Period to the extent not previously
        distributed:

       

      (i)  all
        collections received by the Servicers on the Financed Student Loans, (including
        any Guarantee Payments received) but net of any applicable administrative
        fees,
        a portion of any late fees or similar fees received from a
        borrower;

       

      (ii)  all
        Liquidation Proceeds and all Recoveries in respect of Liquidated Student
        Loans
        which were written off in prior Collection Periods;

       

      (iii)  the
        aggregate Purchase Amounts received for Financed Student Loans repurchased
        by a
        Seller or a Servicer during the Collection Period;

       

      (iv)  Investment
        Earnings for such Distribution Date;

       

      (v)  amounts
        withdrawn from the Reserve Account in excess of the Required Reserve Amount
        and
        deposited into the Collection Account;

       

      (vi)  Advances
        and Optional Deposits, if any; and

       

      (vii)  any
        proceeds received in connection with the sale of the Student Loans, or sums
        collected by the Indenture Trustee pursuant to Sections 5.03 or 5.04(a) of
        the
        Indenture; 

       

      provided,
        however,
        that
        Available Funds will exclude all payments and proceeds (including Liquidation
        Proceeds) of any Financed Student Loans, the related Purchase Amount of which
        has been included in Available Funds, for a prior Distribution Date;
provided,
        further,
        that if
        on any Distribution Date there would not be sufficient funds, after application
        of Available Funds and amounts available from the Reserve Account and draws
        under the Liquidity Note Agreement, to pay any of the items specified in
        clauses
        (1) through (6) of Section 8.02(d) of the Indenture for such Distribution
        Date,
        then Available Funds for such Distribution Date shall include, in addition
        to
        the Available Funds described above in clauses (i) through (vii) inclusive,
        amounts being held pursuant to Section 8.01 of the Indenture or on deposit
        in
        the Collection Account which would have constituted Available Funds for the
        Distribution Date succeeding such Distribution Date, up to the amount necessary
        to pay the items specified in clause (1) through (6) of Section 8.02(d) of
        the
        Indenture, and the Available Funds for such succeeding Distribution Date
        shall
        be adjusted accordingly.

       

      “Back-up
        Administration Agreement”:
        means
        the Back-up Administration Agreement dated as of September 28, 2006 among
        the
        Issuer, Back-up Administrator, the Owner Trustee, the Administrator and the
        Depositor.

       

      “Back-up
        Administration Fee”
means
        the fee payable to the Back-up Administrator pursuant to the Back-up
        Administration Agreement.

       

      “Back-up
        Administrator”
means
        U.S. Bank National Association, a national banking association, in its capacity
        as back-up administrator of the Issuer and the Financed Student Loans, and
        its
        successors and permitted assigns.

       

      “Back-up
        Administrator Default”
means
        the occurrence of any event specified in Section 8(d) of the Administration
        Agreement after the Back-up Administrator has assumed the duties required
        to be
        performed by the Administrator pursuant to the Back-up Administration
        Agreement.

       

      “Basic
        Documents”
means
        the Trust Agreement, the Indenture, all Student Loan Purchase Agreements,
        the
        Deposit and Sale Agreement, the Servicing Agreements, the Administration
        Agreement, the Back-up Administration Agreement, the Liquidity Note Agreement,
        the Custodial Agreements, the Note Depository Agreement, the Guarantee
        Agreements, the TERI Deposit and Security Agreement, any Program Manual and
        other documents and certificates delivered in connection with any
        thereof.

       

      “Beneficial
        Owner”
means,
        with respect to a 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 or as an indirect participant,
        in
        accordance with the rules of such Depository), as the case may be.

       

      “Book-Entry
        Note”
means
        a
        beneficial interest in the Notes, ownership and transfers of which shall
        be made
        through book entries by a Clearing Agency as described in Section 2.10 of
        the Indenture.

       

      “Business
        Day”
means
        any day other than a Saturday, a Sunday or a day on which banking institutions
        or trust companies in New York City, Minneapolis, Minnesota or the city in
        which
        the designated corporate trust office of the Indenture Trustee is located,
        are
        authorized or obligated by law, regulation or executive order to remain
        closed.

       

      “Certificates”
means
        the Trust Certificates issued pursuant to the Trust Agreement, substantially
        in
        the form of Exhibit 1 thereto.

       

      “Certificateholders”
means
        the Persons in whose names Certificates are registered.

       

      “Class”
means
        reference to any of the Class A-1, Class A-2, Class A-3, Class A-4, Class
        A-5,
        Class B, Class C or Class D Notes, as applicable.

       

      “Class
        A Notes”
means
        the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes, Class
        A-5 and Class A-IO Notes.

       

      “Class
        A Percentage”
means
        at any time the percentage equivalent of a fraction, the numerator of which
        is
        the Outstanding Amount of the Class A Notes and the denominator of which
        is the
        sum of the Outstanding Amount of all the Notes.

       

      “Class
        A-1 Note”
means
        a
        Class A-1 Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-1 thereto.

       

      “Class
        A-2 Note”
means
        a
        Class A-2 Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-2 thereto.

       

      “Class
        A-3 Note”
means
        a
        Class A-3 Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-3 thereto.

       

      “Class
        A-4 Note”
means
        a
        Class A-4 Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-4 thereto.

       

      “Class
        A-5 Note”
means
        a
        Class A-5 Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-5 thereto.

       

      “Class
        A-IO Note”
means
        a
        7.10% Class A-IO Note issued pursuant to the Indenture, substantially in
        the
        form of Exhibit A-6 thereto.

       

      “Class
        B Note”
means
        a
        Class B Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-7 thereto.

       

      “Class
        B Percentage”
means
        at any time the percentage equivalent of a fraction, the numerator of which
        is
        the Outstanding Amount of the Class B Notes and the denominator of which
        is the
        sum of the Outstanding Amount of all the Notes.

       

      “Class
        B Note Interest Trigger”
means
        on any Distribution Date, if the Cumulative Default Rate for such Distribution
        Date equals or exceeds the percentage listed below for the most recent date
        preceding such Distribution Date:

       

      

      
        	
                Date

              	
                Cumulative
                  Default Rate

              
	
                June
                  1, 2007

              	
                3.00%

              
	
                June
                  1, 2008

              	
                9.00%

              
	
                June
                  1, 2009

              	
                15.00%

              
	
                June
                  1, 2010

              	
                21.00%

              
	
                June
                  1, 2011

              	
                25.00%

              
	
                June
                  1, 2012

              	
                30.00%

              
	
                June
                  1, 2013

              	
                30.00%

              

      

      

      provided,
        however,
        that a
        Class B Note Interest Trigger will not be deemed to be in effect if (a) on
        the
        last day of the related Collection Period, the aggregate Outstanding Amount
        of
        the Class A Notes is less than the sum of the Pool Balance plus the amount
        on
        deposit in the Reserve Account (excluding the sum of (i) the amount on deposit
        in the TERI Pledge Fund and (ii) the amount of any Noteholders’ Interest
        Carryover Shortfall for the Class B Notes) or 

       

      (b)
        TERI
        is solvent and is continuing to purchase Defaulted Student Loans with respect
        to
        which TERI has become obligated to purchase under the terms of the relevant
        Guaranty Agreement.

       

      “Class
        C Note”
means
        a
        Class C Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-8 thereto.

       

      “Class
        C Note Interest Trigger”
means
        on any Distribution Date, if the Cumulative Default Rate for such Distribution
        Date equals or exceeds the percentage listed below for the most recent date
        preceding such Distribution Date:

       

      

      
        	
                Date

              	
                Cumulative
                  Default Rate

              
	
                June
                  1, 2007

              	
                3.00%

              
	
                June
                  1, 2008

              	
                7.00%

              
	
                June
                  1, 2009

              	
                12.00%

              
	
                June
                  1, 2010

              	
                16.00%

              
	
                June
                  1, 2011

              	
                19.00%

              
	
                June
                  1, 2012

              	
                21.00%

              
	
                June
                  1, 2013

              	
                23.00%

              

      

      

      provided,
        however,
        that a
        Class C Note Interest Trigger will not be deemed to be in effect if (a) on
        the
        last day of the related Collection Period, the aggregate Outstanding Amount
        of
        the Class A Notes and the Class B Notes is less than the sum of the Pool
        Balance
        plus the amount on deposit in the Reserve Account (excluding the sum of (i)
        the
        amount on deposit in the TERI Pledge Fund and (ii) the amount of any
        Noteholders’ Interest Carryover Shortfall for the Class B Notes and the Class C
        Notes) or (b) TERI is solvent and is continuing to purchase Defaulted Student
        Loans with respect to which TERI has become obligated to purchase under the
        terms of the relevant Guaranty Agreement.

       

      “Class
        C Percentage”
means
        at any time the percentage equivalent of a fraction, the numerator of which
        is
        the Outstanding Amount of the Class C Notes and the denominator of which
        is the
        sum of the Outstanding Amount of all the Notes.

       

      “Class
        D Note”
means
        a
        Class D Note issued pursuant to the Indenture, substantially in the form
        of
        Exhibit A-9 thereto.

       

      “Class
        D Note Interest Trigger”
means
        on any Distribution Date if (a)
        the
        sum of the pool balance at the end of the preceding collection period plus
        amounts on deposit in the reserve account (excluding amounts on deposit in
        the
        TERI pledge fund) after payments on that distribution date is less than (b)
        84%
        of the outstanding principal balance of the offered notes and any amounts
        drawn
        and not repaid on the liquidity note after payments on that distribution
        date.

       

      provided,
        however,
        that a
        Class D Note Interest Trigger will not be deemed to be in effect if (a) on
        the
        last day of the related Collection Period, the aggregate Outstanding Amount
        of
        the Class A Notes, the Class B Notes and the Class C Notes is less than the
        sum
        of the Pool Balance plus the amount on deposit in the Reserve Account (excluding
        the sum of (i) the amount on deposit in the TERI Pledge Fund and (ii) the
        amount
        of any Noteholders’ Interest Carryover Shortfall for the Class B Notes, the
        Class C Notes and the Class D Notes) or (b) TERI is solvent and is continuing
        to
        purchase Defaulted Student Loans with respect to which TERI has become obligated
        to purchase under the terms of the relevant Guaranty Agreement. 

       

      “Class
        D Percentage”
means
        at any time the percentage equivalent of a fraction, the numerator of which
        is
        the Outstanding Amount of the Class D Notes and the denominator of which
        is the
        sum of the Outstanding Amount of all the Notes. 

       

      “Clearing
        Agency”
means
        an organization registered as a “clearing agency” pursuant to Section 17A
        of the Exchange Act.

       

      “Clearing
        Agency Participant”
means
        a
        broker, dealer, bank, other financial institution or other Person for whom
        from
        time to time a Clearing Agency effects book-entry transfers and pledges of
        securities deposited with the Clearing Agency.

       

      “Clearstream”
means
        Clearstream Banking, a société anonyme, a limited liability company organized
        under the laws of Luxembourg.

       

      “Closing
        Date”
means
        September 28, 2006.

       

      “Code”
means
        the Internal Revenue Code of 1986, as amended from time to time, and Treasury
        Regulations promulgated thereunder.

       

      “Collateral”
has
        the
        meaning specified in the Granting Clause of the Indenture.

       

      “Collection
        Account”
means
        the account designated as such, established and maintained pursuant to Section
        8.02(a)(i) of the Indenture.

       

      “Collection
        Period”
means,
        with respect to the first Distribution Date, the period beginning on the
        Cutoff
        Date and ending on October 31, 2006, and with respect to each subsequent
        Distribution Date, the Collection Period means the calendar month immediately
        following the end of the previous Collection Period.

       

      “Corporate
        Trust Office”
means
        (i) with respect to the Indenture Trustee and the Note Registrar (so long
        as the Indenture Trustee is the Note Registrar), the designated office of
        the
        Indenture Trustee at which at any particular time its corporate trust business
        shall be administered, which office at the Closing Date is located at One
        Federal Street, 3rd Floor, Boston, Massachusetts 02110,
        Attention:  The National Collegiate Student Loan Trust 2006-3
        (facsimile: (617) 603-6638) or at such other address as the Indenture Trustee
        may designate from time to time by notice to the Noteholders, the Administrator,
        and the Depositor, or the principal corporate trust office of any successor
        Indenture Trustee (the address of which the successor Indenture Trustee will
        notify the Noteholders, the Administrator, and the Depositor) and (ii) with
        respect to the Owner Trustee, the principal corporate trust office of the
        Owner
        Trustee located at Rodney Square North, 1100 North Market Street, Wilmington,
        Delaware 19890, Attention: Corporate Trust Administration (facsimile:
        302-636-4140); or at such other address as the Owner Trustee may designate
        by
        notice to the Certificateholders, the Administrator and the Depositor, or
        corporate trust office of any successor Owner Trustee (the address of which
        the
        successor Owner Trustee will notify the Certificateholders, the Administrator,
        the Back-up Administrator and the Depositor).

       

      “Cost
        of Issuance Account”
means
        the account designated as such, established and maintained pursuant to Section
        8.06 of the Indenture.

       

      “Credit-Worthy
        Cosigned Loan”
means
        a
        loan made to a borrower to pay the costs of attendance at a school approved
        under the Student Loan Programs, which loan (i) was originated and underwritten
        to a credit-worthy standard as set forth in the related Program Manual with
        at
        least two signatures on the note evidencing such Student Loan, and (ii) is
        guaranteed by TERI.

       

      “Credit-Worthy
        Non-Cosigned Loan”
means
        a
        loan made to a borrower to pay the costs of attendance at a school approved
        under the Student Loan Programs, which loan (i) was originated and underwritten
        to a credit-worthy standard as set forth in the related Program Manual with
        one
        signature on the note evidencing such Student Loan, and (ii) is guaranteed
        by
        TERI.

       

      “Credit-Ready
        Loan”
means
        a
        loan made to a borrower to pay the costs of attendance at a school approved
        under the Student Loan Programs, which loan (i) was originated and underwritten
        to a credit-ready standard as set forth in the related Program Manual with
        one
        signature on the note evidencing such Student Loan, and (ii) is guaranteed
        by
        TERI.

       

      “Cumulative
        Default Rate”
means,
        as of any Distribution Date, the percentage equivalent of the fraction (a)
        the
        numerator of which is the aggregate principal balance of the Financed Student
        Loans which are Defaulted Student Loans as of the end of the related Collection
        Period, and (b) the denominator of which is the aggregate principal balance
        of
        the Financed Student Loans as of the Cutoff Date.

       

      “Custodial
        Agreements”
means
        the Custodial Agreements, dated as of September 28, 2006, each between the
        applicable Servicer and the Indenture Trustee.

       

      “Cutoff
        Date”
means
        with respect to the Financed Student Loans, August 31, 2006.

       

      “Default”
means
        any occurrence that is, or with notice or the lapse of time or both would
        become, an Event of Default.

       

      “Defaulted
        Student Loan”
means
        a
        Financed Student Loan for which a TERI Guaranty Event has occurred.

       

      “Definitive
        Notes”
has
        the
        meaning specified in Section 2.10 of the Indenture.

       

      “Delivery”
or
        “Deliver”
when
        used with respect to Trust Account Property means the following and such
        additional or alternative procedures as may hereafter become appropriate
        to
        effect the complete transfer of ownership of any such Collateral to the
        Indenture Trustee, free and clear of any adverse claims, consistent with
        changes
        in applicable law or regulations or the interpretation thereof:

       

      (a)  with
        respect to bankers’ acceptances, commercial paper, negotiable certificates of
        deposit and other obligations that constitute instruments and are susceptible
        of
        physical delivery (“Physical Property”):

       

      (b)  transfer
        of possession thereof to the Indenture Trustee endorsed to, or with respect
        to a
        certificated security:

       

      (i)  delivery
        thereof in bearer form to the Indenture Trustee; or

       

      (ii)  delivery
        thereof in registered form to the Indenture Trustee and

       

      (A)  the
        certificate is endorsed to the Indenture Trustee or in blank by effective
        endorsement; or

       

      (B)  the
        certificate is registered in the name of the Indenture Trustee, upon original
        issue or registration of transfer by the issuer;

       

      (c)  with
        respect to an uncertificated security:

       

      (i)  the
        delivery of the uncertificated security to the Indenture Trustee;
        or

       

      (ii)  the
        issuer has agreed that it will comply with instructions originated by the
        Indenture Trustee, without further consent by the registered owner;

       

      (d)  with
        respect to any security issued by the U.S. Treasury, the Federal Home Loan
        Mortgage Corporation or by the Federal National Mortgage Association that
        is a
        book-entry security held through the Federal Reserve System pursuant to Federal
        book-entry regulations:

       

      (i)  a
        Federal
        Reserve Bank by book entry credits the book-entry security to the securities
        account (as defined in 31 CFR Part 357) of a participant (as defined in 31
        CFR
        Part 357) which is also a securities intermediary; and

       

      (ii)  the
        participant indicates by book entry that the book-entry security has been
        credited to the Indenture Trustee’s securities account, as
        applicable;

       

      (e)  with
        respect to a security entitlement:

       

      (i)  the
        Indenture Trustee, becomes the entitlement holder; or

       

      (ii)  the
        securities intermediary has agreed that it will comply with entitlement orders
        originated by the Indenture Trustee;

       

      (f)  without
        further consent by the entitlement holder for the purpose of clauses (b)
        and (c)
        hereof “delivery” means:

       

      (i)  with
        respect to a certificated security:

       

      (A)  the
        Indenture Trustee, acquires possession thereof;

       

      (B)  another
        person (other than a securities intermediary) either acquires possession
        thereof
        on behalf of the Indenture Trustee or, having previously acquired possession
        thereof, acknowledges that it holds for the Indenture Trustee; or

       

      (C)  a
        securities intermediary acting on behalf of the Indenture Trustee acquires
        possession of thereof, only if the certificate is in registered form and
        has
        been specially endorsed to the Indenture Trustee by an effective
        endorsement;

       

      (ii)  with
        respect to an uncertificated security:

       

      (A)  the
        issuer registers the Indenture Trustee as the registered owner, upon original
        issue or registration of transfer; or

       

      (B)  another
        person (other than a securities intermediary) either becomes the registered
        owner thereof on behalf of the Indenture Trustee, or, having previously become
        the registered owner, acknowledges that it holds for the Indenture
        Trustee;

       

      (g)  for
        purposes of this definition, except as otherwise indicated, the following
        terms
        shall have the meaning assigned to each such term in the UCC:

       

      (i)  “certificated
        security”

       

      (ii)  “effective
        endorsement”

       

      (iii)  “entitlement
        holder”

       

      (iv)  “instrument”

       

      (v)  “securities
        account”

       

      (vi)  “securities
        entitlement”

       

      (vii)  “securities
        intermediary”

       

      (viii)  “uncertificated
        security”

       

      (h)  in
        each
        case of Delivery contemplated herein, the Indenture Trustee shall make
        appropriate notations on its records, and shall cause same to be made of
        the
        records of its nominees, indicating that securities are held in trust pursuant
        to and as provided in this Agreement.

       

      “Deposit
        and Sale Agreement”
means
        the Deposit and Sale Agreement dated as of September 28, 2006, between the
        Depositor and the Issuer pursuant to which the Depositor transfers Student
        Loans
        to the Issuer.

       

      “Depositor”
means
        The National Collegiate Funding LLC, as depositor under the Trust Agreement
        and
        any successor thereto or assignee thereof.

       

      “Depository”
means
        The Depository Trust Company, a New York corporation, its successors and
        assigns.

       

      “Depository
        Participant”
means
        a
        Person for whom, from time to time, the Depository effects book-entry transfers
        and pledges of securities deposited with the Depository.

       

      “Determination
        Date”
means,
        with respect to any Distribution Date, the third Business Day preceding such
        Distribution Date.

       

      “Distribution
        Date”
means,
        the 25th
        calendar
        day of each month or if such day is not a Business Day, the next Business
        Day,
        commencing November 27, 2006.

       

      “DTC”
means
        the Depository Trust Company, a New York corporation.

       

      “DTC
        Custodian”
means
        the Indenture Trustee as a custodian for DTC.

       

      “Eligible
        Deposit Account”
means
        either (a) a segregated account with an Eligible Institution, (b) a
        segregated trust account with the corporate trust department of a depository
        institution organized under the laws of the United States of America or any
        one
        of the States (or any domestic branch of a foreign bank), having corporate
        trust
        powers and acting as trustee for funds deposited in such account, so long
        as any
        of the securities of such depository institution have a credit rating from
        at
        least two nationally recognized Rating Agencies in one of their respective
        generic rating categories which signifies investment grade, or (c) any other
        account that is acceptable to the Rating Agencies (as evidenced by written
        confirmation to the Indenture Trustee from each Rating Agency that the use
        of
        such account satisfies the Rating Agency Condition).

       

      “Eligible
        Institution”
means
        a
        depository institution (which may be, without limitation, the Indenture Trustee
        or any Affiliate of the Indenture Trustee) organized under the banking laws
        of
        the United States of America or any one of the States (or any domestic branch
        of
        a foreign bank), (a) which has (i) a short-term senior unsecured debt rating
        of
“P-1” or better by Moody’s, (ii) either (A) a long term senior unsecured debt
        rating of “AAA” by S&P or (B) a short-term senior unsecured debt rating
“A-1+” by S&P, and (iii) a short-term senior unsecured debt rating of “F-1”
or better by Fitch or any other long-term, short-term or certificate of deposit
        rating acceptable to the Rating Agencies, and (b) whose deposits are insured
        by
        the FDIC.

       

      “Eligible
        Investments”
mean
        book-entry securities, negotiable instruments or securities represented by
        instruments in bearer or registered form which evidence:

       

      (a)  direct
        obligations of, and obligations fully guaranteed as to timely payment by,
        the
        United States of America;

       

      (b)  demand
        deposits, time deposits or certificates of deposit of any depository institution
        or trust company incorporated under the laws of the United States of America
        or
        any State (or any domestic branch of a foreign bank) and subject to supervision
        and examination by Federal or state banking or depository institution
        authorities (including depository receipts issued by any such institution
        or
        trust company as custodian with respect to any obligation referred to in
        clause (a) above or portion of such obligation for the benefit of the
        holders of such depository receipts); provided,
        however,
        that
        (i) each such investment has an original maturity of less than 365 days and
        (ii)
        at the time of the investment or contractual commitment to invest therein
        (which
        shall be deemed to be made again each time funds are reinvested following
        each
        Distribution Date, as the case may be), the commercial paper or other short-term
        senior unsecured debt obligations (other than such obligations the rating
        of
        which is based on the credit of a Person other than such depository institution
        or trust company) thereof shall have a credit rating from Moody’s, S&P and
        Fitch in the highest investment category granted thereby;

       

      (c)  commercial
        paper having an original maturity of less than 365 days and having, at the
        time
        of the investment or contractual commitment to invest therein, a rating from
        Moody’s, S&P and Fitch in the highest investment category granted
        thereby;

       

      (d)  investments
        in money market funds (including funds for which the Indenture Trustee or
        the
        Owner Trustee or any of their respective Affiliates is an investment manager
        or
        advisor) that (i) maintain a stable $1.00 net asset value per share, (ii)
        are
        freely transferable on a daily basis, (iii) invests only in other Eligible
        Investments, and (iv) have a rating from Moody’s, S&P and Fitch in the
        highest investment category granted thereby;

       

      (e)  bankers’
        acceptances having an original maturity of less than 365 days and issued
        by any
        depository institution or trust company referred to in clause (b) above;
        and

       

      (f)  any
        other
        investment permitted by each of the Rating Agencies and as set forth in writing
        delivered to the Indenture Trustee; provided
        that
        such investment shall satisfy the Rating Agency Condition and that such
        investment is relatively risk free.

       

      “ERISA”
means
        the Employee Retirement Income Security Act of 1974, as amended.

       

      “Euroclear”
means
        the Euroclear System, or any successor thereto.

       

      “Event
        of Default”
has
        the
        meaning specified in Section 5.01 of the Indenture.

       

      “Exchange
        Act”
means
        the Securities Exchange Act of 1934, as amended.

       

      “Executive
        Officer”
means,
        with respect to any corporation, the Chief Executive Officer, Chief Operating
        Officer, Chief Financial Officer, President, any Executive Vice President,
        any
        Senior Vice President, any Vice President, the Secretary, the Assistant
        Secretary or the Treasurer of such corporation; and with respect to any
        partnership, any general partner thereof.

       

      “FASB”
means
        the Financial Accounting Standards Board.

       

      “FDIC”
means
        the Federal Deposit Insurance Corporation.

       

      “Final
        Maturity Date”
means
        for the (i) Class A-1 Notes, September 25, 2019, (ii) Class A-2 Notes, March
        25,
        2026, (iii) Class A-3 Notes, October 25, 2027, (iv) Class A-4 Notes, March
        26,
        2029, (v) Class A-5 Notes, October 27, 2031, (vi) Class A-IO Notes, January
        25,
        2012, (vii) Class B Notes, January 26, 2032, (viii) Class C Notes, February
        25,
        2032, and (viii) Class D Notes, March 25, 2032.

       

      “Financed
        Student Loans”
means
        the Student Loans identified as such in each of the pool supplements dated
        as of
        the Closing Date between the Trust and a Seller, transferred to the Trust
        as of
        the Closing Date and listed on the Schedule of Financed Student Loans on
        the
        Closing Date as set forth in Schedule
        A
        to the
        Indenture (which Schedule may be in the form of microfiche or computer disk
        or
        tape).

       

      “Financed
        Student Loan Note”
means
        the original fully executed copy of the note (or a copy of a fully executed
        master promissory note) evidencing each Financed Student Loan.

       

      “FMC”
means
        The First Marblehead Corporation.

       

      “Fitch”
means
        Fitch, Inc., and its successors and assigns.

       

      “Global
        Note”
means
        any Note registered in the name of the Depository or its nominee, beneficial
        interests of which are reflected on the books of the Depository or on the
        books
        of a Person maintaining any account with such Depository (directly or as
        an
        indirect participant in accordance with the rules of such
        Depository).

       

      “Grant”
means
        mortgage, 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 the Collateral 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.

       

      “Guarantee”
means
        with respect to a Student Loan, the insurance or guarantee of the Guarantee
        Agency pursuant to such Guarantee Agency’s Guarantee Agreement.

       

      “Guarantee
        Agency”
means
        TERI.

       

      “Guarantee
        Agreements”
means
        the TERI Guarantee Agreements.

       

      “Guarantee
        Payment”
means
        any payment made by the Guarantee Agency pursuant to the Guarantee Agreement
        in
        respect of a Financed Student Loan.

       

      “Indenture”
means
        the Indenture dated as of September 1, 2006, between the Issuer and the
        Indenture Trustee.

       

      “Indenture
        Trustee”
means
        U.S. Bank National Association, not in its individual capacity but solely
        as
        Indenture Trustee under the Indenture.

       

      “Indenture
        Trust Estate”
means
        all money, instruments, rights and other property that are subject or intended
        to be subject to the lien and security interest of the Indenture for the
        benefit
        of the Noteholders (including all property and interests granted to the
        Indenture Trustee), including all proceeds thereof.

       

      “Independent”
means,
        when used with respect to any specified Person, that the Person (a) is in
        fact independent of the Issuer, any other obligor upon the Notes, the Depositor,
        the Administrator, the Back-up Administrator and any Affiliate of any of
        the
        foregoing Persons, (b) does not have any direct financial interest or any
        material indirect financial interest in the Issuer, any such other obligor,
        the
        Depositor, the Administrator, the Back-Up Administrator or any Affiliate
        of any
        of the foregoing Persons and (c) is not connected with the Issuer, any such
        other obligor, the Depositor, the Administrator, the Back-Up Administrator
        or
        any Affiliate of any of the foregoing Persons as an officer, employee, promoter,
        underwriter, trustee, partner, director or person performing similar functions.
        Whenever it is herein provided that any Independent Person’s Opinion of Counsel
        or certificate shall be furnished to the Indenture Trustee, such Person shall
        be
        appointed by the Issuer or the Indenture Trustee, as the case may be, and
        such
        Opinion of Counsel or certificate shall state that the signer has read this
        definition and that the signer is Independent within the meaning
        hereof.

       

      “Index
        Maturity”
means,
        (i) for One-Month LIBOR, one month, (ii) for Two-Month LIBOR, two months,
        and
        (ii) for Three-Month LIBOR, three months.

       

      “Indirect
        Participant”
means
        any financial institution for whom any Participant holds an interest in any
        Note.

       

      “Insider”
means,
        with respect to an entity, any officer, director or person privy to material
        information, including, but not limited to, contracts or agreements concerning
        such entity that are not available to the general public.

       

      “Insolvency
        Event”
means,
        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 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 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 Federal or state 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 taking of action by such Person in furtherance of any of the
        foregoing.

       

      “Interest
        Collections”
shall
        have the meaning specified in Section 8.07 of the Indenture.

       

      “Interest
        Period”
means,
        with respect to a Distribution Date for a Class of Notes, the period from
        and
        including the Closing Date or the most recent Distribution Date for that
        Class
        of Notes on which interest on the Notes has been distributed to but excluding
        the current Distribution Date.

       

      “Interested
        Noteholders”
means
        the Class A Noteholders (until such time as all Class A Notes have been paid
        in
        full), then the Class B Noteholders (until such time as all Class B Notes
        have
        been paid in full), and finally the Class C Noteholders). Notwithstanding
        the
        foregoing, any Notes owned by the Administrator, the Depositor or any of
        their
        respective Affiliates or agents designated for such purpose, shall not be
        voted
        by such entity nor considered in determining any specified voting percentage
        of
        the Interested Noteholders, unless otherwise set forth in the Indenture.
        Further, the term “Interested Noteholders” also shall include the Liquidity
        Provider if the Liquidity Note Balance is greater than zero.

       

      “Investment
        Earnings”
means,
        with respect to any Distribution Date, the investment earnings (net of losses
        and investment expenses) on amounts on deposit in the Trust Accounts to be
        deposited into the Collection Account on or prior to such Distribution Date
        pursuant to Section 8.02(b) of the Indenture.

       

      “Irish
        Paying Agent”
means
        Custom House Administration and Corporate Services Limited, and its successors
        and assigns, and any other entity serving in such capacity.

       

      “Irish
        Paying Agent Agreement”
means
        Irish Paying Agency Agreement dated as of September 28, 2006 between the
        Irish
        Paying Agent and the Administrator on behalf of the Issuer.

       

      “Issuer”
means
        The National Collegiate Student Loan Trust 2006-3 until a successor replaces
        it
        and, thereafter, means the successor.

       

      “Issuer
        Order”
and
        “Issuer
        Request”
means
        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”
means
        the London interbank offered rate for deposits in U.S. dollars for a specified
        maturity.

       

      “LIBOR
        Determination Date”
means,
        with respect to each Interest Period, the second Business Day prior to the
        commencement of such Interest Period. For purposes of this definition, a
        “Business Day” is any day on which banks in London and New York City are open
        for the transaction of business.

       

      “Lien”
means
        a
        security interest, lien, charge, pledge, equity or encumbrance of any kind,
        other than tax liens and any other liens, if any, which attach to the respective
        Financed Student Loan by operation of law as a result of any act or omission
        by
        the related Obligor.

       

      “Liquidated
        Student Loan”
means
        any defaulted Financed Student Loan, liquidated by a Servicer.

       

      “Liquidation
        Proceeds”
means,
        with respect to any Liquidated Student Loan, the moneys collected in respect
        thereof from whatever source, other than Recoveries or Guarantee Payments
        received, net of the sum of any amounts expended by a Servicer in connection
        with such liquidation and any amounts required by law to be remitted to the
        borrower on such Liquidated Student Loan.

       

      “Liquidity
        Facility Guarantor”
has
        the
        meaning specified in Section 2.5 of the Liquidity Note Agreement. 

       

      “Liquidity
        Provider”
means
        UBS AG, Stamford branch, and its successors and permitted assigns, including
        any
        Liquidity Facility Guarantor.

       

      “Liquidity
        Note”
has
        the
        meaning specified in Section 8.10. 

       

      “Liquidity
        Note Agreement”
means
        the Liquidity Note Agreement, dated as of September 28, 2006, between the
        Issuer, the Liquidity Provider and the Indenture Trustee.

       

      “Liquidity
        Note Balance”
means,
        with respect to any date of determination, the excess, if any, of (i) all
        amounts paid by the Liquidity Provider to the Issuer pursuant to the terms
        of
        the Liquidity Note Agreement over (ii) all amounts reimbursed by the Issuer
        to
        the Liquidity Provider for such payments (excluding interest, fees and
        expenses).

       

      “Liquidity
        Note Commitment”
has
        the
        meaning specified in Section 8.10.

       

      “Moody’s”
means
        Moody’s Investors Service, Inc., and its successors and assigns.

       

      “Note
        Depository Agreement”
means
        the blanket issuer letter of representations dated as of September 27, 2006
        relating to the Notes, executed by the Issuer and received and accepted by
        The
        Depository Trust Company, as the initial Clearing Agency.

       

      “Note
        Interest Rate”
means,
        with respect to any Interest Period and (1) in the case of each Class of
        Notes,
        other than the Class A-IO Notes, the interest rate per annum equal to the
        sum of
        (x) the Applicable Index plus (y) the Applicable Note Margin for such Class,
        and
        (2) in the case of the Class A-IO Notes, 7.10% per annum. The interest rate
        per
        annum for each Class of Notes, other than the Class A-IO Notes, will be computed
        on the basis of the actual number of days elapsed in the related Interest
        Period
        divided by 360. The interest rate per annum for the Class A-IO Notes will
        be
        computed on a 30/360 basis, meaning a year of 360 days that is comprised
        of 12
        months consisting of 30 days each; provided,
        however,
        that
        the initial Interest Period for the Class A-IO Notes shall consist of 59
        days.

       

      “Note
        Owner”
means,
        with respect to a Book-Entry Note, the Person who is the owner of such
        Book-Entry Note, as reflected on the books of the Clearing Agency, or on
        the
        books of a Person maintaining an account with such Clearing Agency (directly
        as
        a Clearing Agency Participant or as an indirect participant, in each case
        in
        accordance with the rules of such Clearing Agency).

       

      “Note
        Parity Trigger”
means
        on any Distribution Date on and after the Stepdown Date if (a) the sum of
        the
        Pool Balance plus amounts on deposit in the Reserve Account (excluding amounts
        on deposit in the TERI Pledge Fund) at the end of the preceding Collection
        Period is less than (b) 101% of the Outstanding Amount of the Notes and the
        Liquidity Note Balance after payments on that Distribution Date.

       

      “Note
        Register”
and
        “Note
        Registrar”
have
        the respective meanings specified in Section 2.04 of the
        Indenture.

       

      “Noteholders”
means
        each Person in whose name a Note is registered in the Note.

       

      “Noteholders’
        Interest Carryover Shortfall”
means,
        with respect to any Distribution Date and any Class of Notes, the sum of
        (x) the
        excess of (i) the sum of the related Noteholders’ Interest Distribution
        Amount with respect to that Class of Notes, on the preceding Distribution
        Date
        for the Class of Notes over (ii) the amount of interest actually
        distributed to the holders of that Class of Notes on such preceding Distribution
        Date, and (y) all Noteholders’ Interest Carryover Shortfall for that Class of
        Notes remaining unpaid from prior Distribution Dates, plus interest on the
        amount of such excess interest due to the holders of that Class of Notes
        to the
        extent permitted by law, at the then current Note
        Interest Rate for that Class of Notes from such preceding Distribution Date
        for
        that Class of Notes to the current Distribution Date for that Class of
        Notes.

       

      “Noteholders’
        Interest Distribution Amount”
means,
        with respect to any Distribution Date and any Class of Notes, the aggregate
        amount of interest accrued at the applicable Note Interest Rate for the related
        Interest Period on the outstanding principal balance (or Notional Amount,
        for
        the Class A-IO Note) of such Class of Notes on the immediately preceding
        Distribution Date after giving effect to all principal distributions (or
        related
        reduction in Notional Amount, as applicable), to such Noteholders of such
        Class
        on such date (or, in the case of the first Distribution Date, on the Closing
        Date).

       

      “Noteholders’
        Principal Distribution Amount”
means,
        with respect to any Distribution Date, the amount necessary, so that after
        distributing such amount to the Notes, (a) the sum of the Pool Balance at
        the
        end of the preceding Collection Period, plus amounts on deposit in the Reserve
        Account (excluding amounts on deposit in the TERI Pledge Fund) after payments
        on
        such Distribution Date, equals (b) 103% of the Outstanding Amount of the
        Notes
        and the Liquidity Note Balance after payments on such Distribution Date;
        provided,
        however,
        that
        the Noteholders’ Principal Distribution Amount will not exceed the Outstanding
        Amount of the Notes. In addition, (a) on the Final Maturity Date for each
        related Class of Notes, the principal required to be distributed to such
        Class
        of Notes will include the amount required to reduce the Outstanding Amount
        of
        such Class of Notes to zero.

       

      “Notes”
means
        collectively, the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes,
        the
        Class A-4 Notes, the Class A-5 Notes, the Class A-IO Notes, the Class B Notes,
        the Class C Notes, and the Class D Notes.

       

      “Notional
        Amount”
means,
        for the Class A-IO Notes, the amount on which the interest accrued on such
        Class
        of Notes is computed and, as of any Distribution Date, shall equal the amount
        determined as follows:

       

      
        	
                Distribution
                  Dates

              	
                Notional
                  Amount

              
	
                November
                  2006 -

                April
                  2011

              	
                $325,130,000
                  

              
	
                May
                  2011

              	
                $305,000,000
                  

              
	
                June
                  2011

              	
                $286,000,000
                  

              
	
                July
                  2011

              	
                $267,000,000
                  

              
	
                August
                  2011

              	
                $250,000,000
                  

              
	
                September
                  2011

              	
                $233,000,000
                  

              
	
                October
                  2011

              	
                $217,000,000
                  

              
	
                November
                  2011

              	
                $202,000,000
                  

              
	
                December
                  2011

              	
                $187,000,000
                  

              
	
                January
                  2012 and

                thereafter

              	
                $                 
                  0

              

      

      

      However,
        if on any Distribution Date (after giving effect to the distributions of
        principal to be made on that Distribution Date) the Outstanding Amount of
        the
        Class A-5 Notes would be less than its Original Principal Balance, the Notional
        Amount of the Class A-IO Notes will equal the lesser of the Outstanding Amount
        of the Class A-5 Notes and the scheduled Notional Amount determined as described
        in the above table.

       

      “Obligor”
on
        a
        Financed Student Loan means the borrower or co-borrowers of such Financed
        Student Loan and any other Person who owes payments in respect of such Financed
        Student Loan, including the Guarantee Agency thereof.

       

      “Officers’
        Certificate”
means,
        with respect to the Issuer or the Administrator, a certificate signed by
        one of
        its Authorized Officers.

       

      “One-Month
        LIBOR,”
        “Two-Month
        LIBOR”
and
        “Three-Month
        LIBOR”
means,
        with respect to any Interest Period, the London interbank offered rate for
        deposits in U.S. dollars having the Index Maturity which appears on Telerate
        Page 3750 as of 11:00 a.m., London time, on such LIBOR Determination
        Date. If such rate does not appear on Telerate Page 3750, the rate for that
        day will be determined on the basis of the rates at which deposits in U.S.
        dollars, having the Index Maturity and in a principal amount of not less
        than
        U.S. $1,000,000, are offered at approximately 11:00 a.m., London time, on
        such LIBOR Determination Date to prime banks in the London interbank market
        by
        the Reference Banks. The Administrator will request the principal London
        office
        of each of such Reference Banks to provide a quotation of its rate. If at
        least
        two such quotations are provided, the rate for that day will be the arithmetic
        mean of the quotations. If fewer than two quotations are provided, the rate
        for
        that day will be the arithmetic mean of the rates quoted by major banks in
        New
        York City, selected by the Administrator, at approximately 11:00 a.m., New
        York City time, on such LIBOR Determination Date for loans in U.S. dollars
        to
        leading European banks having the Index Maturity and in a principal amount
        of
        not less than U.S. $1,000,000; provided that if the banks selected as aforesaid
        are not quoting as mentioned in this sentence, LIBOR in effect for the
        applicable Interest Period for the applicable Index Maturity will be LIBOR
        in
        effect for the previous Interest Period for that Index Maturity.

       

      “Opinion
        of Counsel”
means
        a
        written opinion of an attorney at law or firm of attorneys selected by the
        Person obliged to deliver an opinion on the subject in question, reasonably
        acceptable to the Person who is to receive the same hereunder, duly admitted
        to
        the practice of law before the highest court of any state of the United States
        of America or the District of Columbia.

       

      “Optional
        Deposit”
has
        the
        meaning specified in Section 8.11(a) of the Indenture.

       

      “Original
        Principal Balance”
means,
        for any Class of Notes, the original principal balance (or, in the case of
        the
        Class A-IO Notes, the original Notional Amount) for such Class on the Closing
        Date, as set forth in Section 2.02 of the Indenture.

       

      “Outstanding”
means,
        as of the date of determination, all Notes theretofore authenticated and
        delivered under the Indenture except:

       

      (i)  Notes
        theretofore canceled by the Note Registrar or delivered to the Note Registrar
        for cancellation;

       

      (ii)  Notes
        or
        portions thereof the payment for which money in the necessary amount has
        been
        theretofore deposited with the Indenture Trustee or any Paying Agent in trust
        for the Noteholders thereof;

       

      (iii)  Notes
        in
        exchange for or in lieu of other Notes which have been authenticated and
        delivered pursuant to the Indenture unless proof satisfactory to the Indenture
        Trustee is presented that any such Notes are held by a bona fide
        purchaser;

       

      provided
        that in
        determining whether the Noteholders of the requisite Outstanding Amount of
        the
        Notes have given any request, demand, authorization, direction, notice, consent
        or waiver hereunder or under any other Basic Document, Notes owned by the
        Issuer, any other obligor upon the Notes, the Depositor, the Administrator,
        a
        Servicer, or any Affiliate of any of the foregoing Persons shall be disregarded
        and deemed not to be Outstanding, except 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 a
        Responsible Officer of the Indenture Trustee either actually knows to be
        so
        owned or has received written notice thereof shall be so disregarded. Notes
        so
        owned that have been pledged in good faith may be regarded as Outstanding
        if the
        pledgee establishes to the satisfaction of the Indenture 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, the Depositor, the Administrator,
        a
        Servicer, or any Affiliate of any of the foregoing Persons.

       

      “Outstanding
        Amount”
means
        the sum of the aggregate principal amount of all Notes (or, if the context
        so
        indicates, one or more Classes of Notes) Outstanding at the date of
        determination and the Liquidity Note Balance. The Class A-IO Notes shall
        have no
        Outstanding Amount.

       

      “Owner
        Trustee”
means
        Wilmington Trust Company, not in its individual capacity but solely as Owner
        Trustee under the Trust Agreement, and any successor thereto or assigned
        thereof.

       

      “Participant”
means
        a
        Person that has an account with DTC.

       

      “Paying
        Agent”
means
        (i) the Indenture Trustee or any other Person that meets the eligibility
        standards for the Indenture Trustee specified in Section 6.11 of the
        Indenture and is authorized by the Issuer to make the payments to and
        distributions from the Collection Account and payments of principal of and
        interest and any other amounts owing on the Notes on behalf of the Issuer
        and
        (ii) the Irish Paying Agent.

       

      “Person”
means
        any individual, corporation, estate, partnership, joint venture, association,
        joint stock company, trust (including any beneficiary thereof), unincorporated
        organization or government or any agency or political subdivision
        thereof.

       

      “Physical
        Property”
has
        the
        meaning assigned to such term in the definition of “Delivery”
above.

       

      “Pool
        Balance”
means,
        at any time, the aggregate principal balance of the Financed Student Loans
        at
        the end of the preceding Collection Period (including accrued interest thereon
        for such Collection Period to the extent such interest will be capitalized
        upon
        commencement of repayment or during deferment or forbearance).

       

      “Predecessor
        Note”
means,
        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 2.05 of the Indenture and 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.

       

      “Prepayment
        Penalty”
means,
        on any Distribution Date on which the Class A-IO Notes are Outstanding, if
        the
        amount listed as the Notional Amount for that Distribution Date on the following
        schedule exceeds the Notional Amount of such Class A-IO Notes immediately
        prior
        to such Distribution Date, an amount equal to the interest accrued on such
        excess at the rate of 7.10% per annum for the applicable Interest
        Period:

       

      

      
        	
                Distribution
                  Dates

              	
                Notional
                  Amount

              
	
                November
                  2006 - 

                April
                  2011

              	
                $325,130,000
                  

              
	
                May
                  2011

              	
                $305,000,000
                  

              
	
                June
                  2011

              	
                $286,000,000
                  

              
	
                July
                  2011

              	
                $267,000,000
                  

              
	
                August
                  2011

              	
                $250,000,000
                  

              
	
                September
                  2011

              	
                $233,000,000
                  

              
	
                October
                  2011

              	
                $217,000,000
                  

              
	
                November
                  2011

              	
                $202,000,000
                  

              
	
                December
                  2011

              	
                $187,000,000
                  

              
	
                January
                  2012 and

                thereafter

              	
                $                  0

              

      

      

      Prepayment
        Penalties shall not be deemed payments of interest and/or principal of the
        Class
        A-IO Notes.

       

      “Proceeding”
means
        any suit in equity, action at law or other judicial or administrative
        proceeding.

       

      “Program
        Manuals”
means
        the program manual attached as an exhibit to each TERI Guarantee Agreement
        together with the student loan program guidelines of each of the Sellers
        which
        describe their credit and collection policies for the origination, acquisition,
        financing and servicing of Financed Student Loans, as amended, revised or
        supplemented from time to time; provided,
        however,
        that no
        such amendment, revision or supplement shall (a) reduce in any manner the
        amount
        of, or delay the timing of, collections of payments with respect to Financed
        Student Loans or (b) reduce the underwriting standards with respect to Financed
        Student Loans acquired or to be acquired by the Issuer, in each case without
        satisfying the Rating Agency Condition.

       

      “Purchase
        Amount”
means,
        as of the close of business on the last day of a Collection Period, 100%
        of the
        amount required to prepay in full the respective Financed Student Loan, in
        each
        case under the terms thereof including all accrued interest thereon expected
        to
        be capitalized upon commencement of repayment or during deferment or
        forbearance.

       

      “Purchased
        Student Loan”
means
        a
        Financed Student Loan purchased by a Service or repurchased by a Seller from
        the
        Issuer.

       

      “Rating
        Agency”
means
        each of Moody’s, S&P and Fitch. If any such organization or successor is no
        longer in existence, “Rating Agency” shall be a nationally recognized
        statistical rating organization or other comparable Person designated by
        the
        Issuer, notice of which designation shall be given to the Indenture Trustee
        and
        the Owner Trustee.

       

      “Rating
        Agency Condition”
means,
        with respect to any action, that each Rating Agency shall have been given
        10 days’ prior notice thereof (or such shorter period as shall be
        acceptable to the Rating Agencies) and that each Rating Agency shall have
        confirmed to the Administrator and the Indenture Trustee, in writing that
        such
        action will not in and of itself result in a reduction or withdrawal of the
        then
        current rating of the Notes, based upon the review by each such Rating Agency
        of
        payment and default performance of the Financed Student Loans, financial
        information relating to the Trust, the Indenture Trust Estate, the Guarantee
        Agency, the Servicers or the Administrator, and such other information that
        such
        Rating Agency determines to review.

       

      “Ratings
        Downgrade”
has
        the
        meaning assigned to such term in the Liquidity Note Agreement.

       

      “Realized
        Losses”
means
        the excess of the aggregate principal balance of any Liquidated Student Loan
        plus accrued but unpaid interest thereon over the related Liquidation Proceeds
        to the extent allocable to principal.

       

      “Record
        Date”
means
        with respect to a Class of the Notes, the close of business on the Business
        Day
        immediately preceding a Distribution Date for such Class of Notes.

       

      “Recoveries”
means,
        with respect to any Liquidated Student Loan, moneys collected in respect
        thereof, from whatever source, during any Collection Period following the
        Collection Period in which such Financed Student Loan, became a Liquidated
        Student Loan, net of the sum of any amounts expended by a Servicer for the
        account of any Obligor and any amounts required by law to be remitted to
        the
        Obligor.

       

      “Reference
        Bank”
means
        a
        leading bank (i) engaged in transactions in Eurodollar deposits in the
        international Eurocurrency market, (ii) not controlling, controlled by or
        under
        common control with the Administrator and (iii) having an established place
        of
        business in London.

       

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

       

      “Rehabilitated
        Student Loans”
means
        Financed Student Loan purchased by TERI due to a TERI Guaranty Event, that
        the
        Trust will repurchase, (to the extent there are Available Funds), if TERI
        succeeds, after purchase, in obtaining from the borrower three or more
        consecutive on-time monthly payments pursuant to the TERI Guarantee Agreements,
        and the borrower is within thirty days of being current on the Financed Student
        Loan.

       

      “Relevant
        Servicing Criteria”
means
        the Servicing Criteria applicable to the Indenture Trustee, as set forth
        on
        Exhibit C attached hereto. With respect to a Servicing Function Participant
        engaged by the Indenture Trustee, the term “Relevant Servicing Criteria” may
        refer to a portion of the Relevant Servicing Criteria applicable to such
        parties.

       

      “Required
        Reserve Amount”
means,
        on any Distribution Date beginning with the Distribution Date in February
        2007
        (after giving effect to all deposits or withdrawals therefrom on that
        Distribution Date), the respective amount listed below for that Distribution
        Date:

       

      

      
        	
                Distribution
                  Date

              	
                Amount

              	 	
                Distribution
                  Date

              	
                Amount

              
	
                February
                  2007

              	
                $354,380,000
                  

              	 	
                March
                  2009

              	
                $90,840,000
                  

              
	
                March
                  2007

              	
                $344,030,000
                  

              	 	
                April
                  2009

              	
                $83,630,000
                  

              
	
                April
                  2007

              	
                $332,960,000
                  

              	 	
                May
                  2009

              	
                $80,390,000
                  

              
	
                May
                  2007

              	
                $322,290,000
                  

              	 	
                June
                  2009

              	
                $74,770,000
                  

              
	
                June
                  2007

              	
                $309,960,000
                  

              	 	
                July
                  2009

              	
                $69,800,000
                  

              
	
                July
                  2007

              	
                $297,510,000
                  

              	 	
                August
                  2009

              	
                $65,850,000
                  

              
	
                August
                  2007

              	
                $285,240,000
                  

              	 	
                September
                  2009

              	
                $62,200,000
                  

              
	
                September
                  2007

              	
                $273,690,000
                  

              	 	
                October
                  2009

              	
                $57,940,000
                  

              
	
                October
                  2007

              	
                $261,860,000
                  

              	 	
                November
                  2009

              	
                $53,700,000
                  

              
	
                November
                  2007

              	
                $250,560,000
                  

              	 	
                December
                  2009

              	
                $50,150,000
                  

              
	
                December
                  2007

              	
                $239,810,000
                  

              	 	
                January
                  2010

              	
                $44,420,000
                  

              
	
                January
                  2008

              	
                $227,800,000
                  

              	 	
                February
                  2010

              	
                $40,200,000
                  

              
	
                February
                  2008

              	
                $215,440,000
                  

              	 	
                March
                  2010

              	
                $38,050,000
                  

              
	
                March
                  2008

              	
                $201,940,000
                  

              	 	
                April
                  2010

              	
                $35,740,000
                  

              
	
                April
                  2008

              	
                $191,840,000
                  

              	 	
                May
                  2010

              	
                $34,550,000
                  

              
	
                May
                  2008

              	
                $182,740,000
                  

              	 	
                June
                  2010

              	
                $31,950,000
                  

              
	
                June
                  2008

              	
                $172,920,000
                  

              	 	
                July
                  2010

              	
                $27,720,000
                  

              
	
                July
                  2008

              	
                $163,800,000
                  

              	 	
                August
                  2010

              	
                $24,200,000
                  

              
	
                August
                  2008

              	
                $154,060,000
                  

              	 	
                September
                  2010

              	
                $21,410,000
                  

              
	
                September
                  2008

              	
                $143,800,000
                  

              	 	
                October
                  2010

              	
                $18,850,000
                  

              
	
                October
                  2008

              	
                $134,500,000
                  

              	 	
                November
                  2010

              	
                $16,740,000
                  

              
	
                November
                  2008

              	
                $124,120,000
                  

              	 	
                December
                  2010

              	
                $15,970,000
                  

              
	
                December
                  2008

              	
                $113,060,000
                  

              	 	
                January
                  2011

              	
                $15,380,000
                  

              
	
                January
                  2009

              	
                $106,890,000
                  

              	 	
                February
                  2011

              	
                $11,700,000
                  

              
	
                February
                  2009

              	
                $ 
                  98,630,000 

              	 	
                March
                  2011 and thereafter

              	
                $
                   9,200,000 

              

      

      

      “Reserve
        Account”
means
        the account designated as such, established and maintained pursuant to Section
        8.02(a)(ii) of the Indenture.

       

      “Reserve
        Account Initial Deposit”
means
        $283,520,000.

       

      “Reserve
        Account Minimum Balance”
means
        $9,200,000.

       

      “Responsible
        Officer”
means,
        with respect to the Indenture Trustee or the Owner Trustee, any officer within
        the Corporate Trust Office of the Indenture Trustee or the Owner Trustee,
        including any Vice President, Assistant Vice President, Secretary, Assistant
        Secretary, or any other officer of the Indenture Trustee or the Owner Trustee
        customarily performing functions similar to those performed by any of the
        above
        designated officers, with direct responsibility for the administration of
        the
        Indenture (or the Trust Agreement, as amended from time to time, as applicable
        to the Owner Trustee) and the other Basic Documents on behalf of the Indenture
        Trustee or the Owner Trustee and also, with respect to a particular matter,
        any
        other officer to whom such matter is referred because of such officer’s
        knowledge of and familiarity with the particular subject.

       

      “S&P”
means
        Standard and Poor’s Ratings Services, a division of The McGraw-Hill Companies,
        Inc., and its successors and assigns.

       

      “Schedules
        of Financed Student Loans”
means
        the listing of the Financed Student Loans set forth in Schedule A to the
        Indenture (which Schedule may be in the form of microfiche or file or computer
        disk tape).

       

      “SEC”
means
        the United States Securities and Exchange Commission.

       

      “Securities”
means
        the Notes.

       

      “Securities
        Act”
means
        the Securities Act of 1933, as amended.

       

      “Seller”
means
        any person authorized to sell Student Loans to the Depositor pursuant to
        a
        Student Loan Purchase Agreement.

       

      “Servicer”
means
        the Pennsylvania Higher Education Assistance Agency, Great Lakes Educational
        Loan Services, Inc., Educational Services of America, Inc., Nelnet, Inc.,
        ACS
        Education Services, Inc.
        and any
        other loan servicer satisfying the Rating Agency Condition.

       

      “Servicer
        Default”
means
        any default event specified in the Servicing Agreement.

       

      “Servicer’s
        Report”
means
        any report of a Servicer delivered pursuant to such Servicer’s Servicing
        Agreement, substantially in the form acceptable to the
        Administrator.

       

      “Servicing
        Agreement”
means
        (a) the agreement by which the Pennsylvania Higher Education Assistance Agency
        will act as the Servicer, dated as of September 18, 2006 between FMC and
        the
        Pennsylvania Higher Education Assistance Agency, (b) the Non-FFELP Loan
        Servicing Agreement, dated as of May 1, 2003, as amended, by and between
        Great
        Lakes Educational Loan Services, Inc. and FMC, (c) Alternative Servicing
        Agreement dated as of February 1, 2004, as supplemented, between Educational
        Services of America, Inc. and FMC, (d) the
        Alternative Servicing Agreement, dated as of March 1, 2005, as amended, between
        ACS Education Services, Inc. and FMC,
        and (e)
        the Loan Servicing Agreement, dated as of August 1, 2001, as amended, between
        Nelnet, Inc. (as successor in interest to UNIPAC Service Corporation) and
        FMC,
        all of which agreements will be assigned to the Trust concurrent with the
        initial purchase of Financed Student Loans, or any other servicing agreement
        between the Issuer and a servicer under which such servicer agrees to service
        Financed Student Loans included in the Indenture Trust Estate, which servicing
        agreement shall satisfy the Rating Agency Condition.

       

      “Servicing
        Criteria”
means
        the “servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may
        be amended from time to time, and as described on Exhibit C attached
        hereto.

       

      “Servicing
        Fee”
means
        the fee payable to a Servicer (including services rendered but not yet invoiced)
        pursuant to such Servicer’s Servicing Agreement as in effect on the Closing
        Date; such fee may be increased upon satisfying the Rating Agency Condition.
        The
        Servicing Fee shall include expenses of the applicable Servicer related to
        sending privacy policy notices as required by the Gramm-Leach-Bliley Act
        of
        1999, as amended, or any successor thereto. As of each Distribution Date,
        the
        Servicing Fee shall include services rendered but not yet invoiced.

       

      “Servicing
        Function Participant”
means
        any Subservicer, Subcontractor or any other Person, other than each Servicer
        and
        the Indenture Trustee, that is participating in the servicing function within
        the meaning of Regulation AB, unless such Person’s activities relate only to 5%
        or less of the Financed Student Loans.

       

      “State”
means
        any one of the 50 States of the United States of America or the District of
        Columbia.

       

      “Stepdown
        Date”
means
        the November 2012 Distribution Date.

       

      “Student
        Loan”
means
        (a) a Credit-Worthy Cosigned Loan, (b) a Credit-Worthy Non-Cosigned Loan,
        or (c) a Credit-Ready Loan.

       

      “Student
        Loan Files”
        means

       

      (a) the
        original fully executed copy of the note evidencing the Financed Student
        Loan
        (including the original loan application fully executed by the Obligor);
        and

       

      (b) any
        and
        all other documents and computerized records that a Servicer shall keep on
        file,
        in accordance with its customary procedures, relating to such Financed Student
        Loan or any borrower with respect thereto.

       

      “Student
        Loan Programs”
means
        the student loan programs sponsored by the Depositor and its Affiliates for
        the
        origination, acquisition, holding, servicing and financing of Student Loans,
        which programs are governed by the Program Manuals.

       

      “Student
        Loan Purchase Agreements”
means,
        collectively, the student loan purchase agreements and any other similar
        agreement providing for the sale of Student Loans from the Sellers to the
        Depositor for deposit into the Indenture Trust Estate, including the pool
        supplement relating thereto by and among the applicable Seller, the Depositor
        and FMC. On the Closing Date, the Student Loan Purchase Agreements shall
        be as
        listed in Schedule C to the Indenture.

       

      “Subcontractor”
means
        any third-party or Affiliate vendor, subcontractor or other Person utilized
        by a
        Servicer, a Subservicer or the Indenture Trustee that is not responsible
        for the
        overall servicing (as “servicing” is commonly understood by participants in the
        student loan backed securities market) of the Financed Student Loans but
        performs one or more discrete functions identified in Item 1122(d) of Regulation
        AB with respect to the Financed Student Loans under direction and authority
        of
        such Servicer, Subservicer or Indenture Trustee.

       

      “Subordinate
        Note Principal Trigger”
means
        if (a) a Note Parity Trigger occurs and is continuing or (b) the Cumulative
        Default Rate exceeds 10%,
        provided, however,
        that a
        Subordinated Note Principal Trigger will not be deemed to be in effect if
        TERI
        is solvent and is continuing to purchase Defaulted Student Loans with respect
        to
        which TERI has become obligated to purchase under the terms of the relevant
        Guaranty Agreement.

       

      “Subservicer”
means
        any Person that (i) is considered to be a Servicing Function Participant,
        (ii)
        services Financed Student Loans on behalf of any Servicer and (iii) is
        responsible for the performance (whether directly or through Subservicers
        or
        Subcontractors) of material servicing functions required to be performed
        by the
        Servicer or the Indenture Trustee under the Basic Documents with respect
        to some
        or all of the Financed Student Loans, that are identified in Item 1122(d)
        of
        Regulation AB.

       

      “Supplemental
        Indenture”
means
        any amendment of or supplement to this Indenture made in accordance with
        Article IX hereof.

       

      “Telerate
        Page 3750”
means
        the display page so designated on the Bridge Telerate Service (or such other
        page as may replace that page on that service for the purpose of displaying
        comparable rates or prices) or such comparable page on a comparable
        service.

       

      “TERI”
means
        The Education Resources Institute, Inc., a Massachusetts non-profit corporation,
        or its successors and assigns.

       

      “TERI
        Deposit and Security Agreement”
means
        the Deposit and Security Agreement dated as of September 28, 2006, by and
        among
        the Issuer, TERI and the Administrator with respect to the issuance of the
        Notes
        hereunder.

       

      “TERI
        Guaranty Agreement”
means,
        with a respect to a Student Loan Program, a guaranty agreement between a
        Seller
        and TERI, together with the acknowledgment by TERI relating thereto. On the
        Issue Date, the TERI Guarantee Agreements shall be as listed on Schedule
        B to
        the Indenture.

       

      “TERI
        Guaranty Amount”
means,
        pursuant to the TERI Guaranty Agreements, Financed Student Loans are guaranteed
        100% as to payment of principal and interest.

       

      “TERI
        Guaranty Event”
means
        a
        claim for payment on a Financed Student Loan made under any of the TERI Guaranty
        Agreements if: (i)(a) the Obligor has failed to make monthly principal and/or
        interest payments on such loan when due, provided such failure continues
        for a
        period of 150 consecutive days, (b) the Obligor has filed a Chapter 13 petition
        in a bankruptcy or, in a Chapter 7 proceeding has filed an adversary proceeding
        pursuant to 11 U.S.C. § 523(a)(8), or (c) the Obligor has died and (ii) the
        conditions set forth in such TERI Guaranty Agreement giving rise to an
        obligation on the part of TERI to make payment on such claim have otherwise
        been
        satisfied.

       

      “TERI
        Pledge Fund”
means
        the fund by the name created in the TERI Deposit and Security Agreement whereby
        TERI will pledge a portion of its guaranty fees to the Trust, by deposit
        into a
        special trust account with the Indenture Trustee.

       

      “Three-Month
        LIBOR”
        see“One-Month
        LIBOR” herein.

       

      “Treasury
        Regulations”
means
        regulations, including proposed or temporary regulations, promulgated under
        the
        Code. References in any document or instrument to specific provisions of
        proposed or temporary regulations shall include analogous provisions of final
        Treasury Regulations or other successor Treasury Regulations.

       

      “Trust”
means
        the Issuer, established pursuant to the Trust Agreement.

       

      “Trust
        Account Property”
means
        the Trust Accounts, all amounts and investments held from time to time in
        any
        Trust Account (whether in the form of deposit accounts, Physical Property,
        book-entry securities, uncertificated securities or otherwise), including
        the
        Reserve Account Initial Deposits and all proceeds of the foregoing.

       

      “Trust
        Accounts”
has
        the
        meaning specified in Section 8.02(b) of the Indenture.

       

      “Trust
        Agreement”
means
        the Trust Agreement, dated as of September 28, 2006, among the Depositor,
        TERI
        and the Owner Trustee.

       

      “Trust
        Certificates”
means
        the Certificates.

       

      “Trust
        Indenture Act”
or
        “TIA”
means
        the Trust Indenture Act of 1939, as amended from time to time.

       

      “Turbo
        Trigger”
means
        any Distribution Date on which (a) the outstanding aggregate Pool Balance
        is
        equal to or less than 10% of the sum of the aggregate principal balance as
        of
        the Cutoff Date of the Financed Student Loans; or (b) the Cumulative Default
        Rate exceeds 10%; provided,
        however,
        that
        with respect to clause (b), a Turbo Trigger will not have occurred if TERI
        is
        solvent and is continuing to purchase Defaulted Student Loans with respect
        to
        which TERI has become obligated to purchase under the terms of the relevant
        Guaranty Agreement.

       

      “Two-Month
        LIBOR”
        see“One-Month
        LIBOR” herein.

       

      “UCC”
means,
        unless the context otherwise requires, the Uniform Commercial Code, as in
        effect
        in the relevant jurisdiction, as amended from time to time.

       

      “Underwriters”
means
        Deutsche Bank Securities Inc., Credit Suisse Securities (USA) LLC, Goldman,
        Sachs & Co., Greenwich Capital Markets, Inc. and UBS Securities LLC.

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
        A

       

      SCHEDULE
        OF FINANCED STUDENT LOANS

       

      [On
        file
        with Indenture Trustee]

       

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
        B

       

      LIST
        OF TERI GUARANTEE AGREEMENTS

       

      Each
        of
        the following guaranty agreements, as amended or supplemented, was entered
        into
        by and between The Education Resources Institute, Inc. and:

       

      ·  Bank
        of
        America, N.A., dated April 30, 2001, for loans that were originated under
        Bank
        of America’s BAGEL Loan Program, TERI Loan Program and ISLP Loan
        Program.

       

      ·  Bank
        of
        America, N.A., dated June 30, 2006, for loans that were originated under
        Bank of
        America’s BAGEL Loan Program, TERI Loan Program and ISLP Loan
        Program.

       

      ·  Bank
        of
        America, N.A., dated June 30, 2003, for loans that were originated under
        Bank of
        America’s Direct to Consumer Loan Program.

       

      ·  Bank
        One,
        N.A., dated May 13, 2002, for loans that were originated under Bank One’s
        CORPORATE ADVANTAGE Loan Program, EDUCATION ONE Loan Program, and Campus
        One
        Loan Program.

       

      ·  Charter
        One Bank, N.A., dated as of December 29, 2003 for loans that were originated
        under Charter One’s AAA Southern New England Bank Loan Program.

       

      ·  Charter
        One Bank, N.A., dated October 31, 2003, for loans that were originated under
        Charter One’s AES EducationGAIN Loan Program.

       

      ·  Charter
        One Bank, N.A., dated March 25, 2004, for loans that were originated under
        Charter One’s Astrive and AstriveAlliance Education Loan Program.

       

      ·  Charter
        One Bank, N.A., dated May 15, 2002, for loans that were originated under
        Charter
        One’s CFS Direct to Consumer Loan Program.

       

      ·  Charter
        One Bank, N.A., dated June 30, 2003, for loans that were originated under
        Charter One’s Citibank Education Assistance Loan Program.

       

      ·  Charter
        One Bank, N.A., dated July 1, 2002, for loans that were originated under
        Charter
        One’s College Loan Corporation Loan Program.

       

      ·  Charter
        One Bank, N.A., dated December 1, 2003, for loans that were originated under
        Charter One’s Custom Educredit Loan Program.

       

      ·  Charter
        One Bank, N.A., dated May 10, 2004, for loans that were originated under
        Charter
        One’s Edfinancial Loan Program.

       

      ·  Charter
        One Bank, N.A., dated September 15, 2003, for loans that were originated
        under
        Charter One’s Extra Credit II Loan Program (North Texas Higher
        Education).

       

      ·  Charter
        One Bank, N.A., dated September 20, 2003, for loans that were originated
        under
        Charter One’s M&I Alternative Loan Program.

       

      ·  Charter
        One Bank, N.A., dated November 17, 2003, for loans that were originated under
        Charter One’s National Education Loan Program.

       

      ·  Charter
        One Bank, N.A., dated May 15, 2002, for loans that were originated under
        Charter
        One’s NextStudent Alternative Loan Program.

       

      ·  Charter
        One Bank, N.A., dated March 26, 2004, for loans that were originated under
        Charter One’s NextStudent Private Consolidation Loan Program.

       

      ·  Charter
        One Bank, N.A., dated May 15, 2003, for loans that were originated under
        Charter
        One’s WAMU Alternative Student Loan Program.

       

      ·  Charter
        One Bank, N.A., dated February 15, 2005, for loans that were originated under
        Charter One’s Referral Loan Program, including the UPromise Alternative Loan
        Program, Collegiate Solutions Alternative Loan Program, College Board
        Alternative Loan Program, and Axiom Alternative Loan Program.

       

      ·  Citizens
        Bank of Rhode Island, dated April 30, 2004, for loans that were originated
        under
        Citizens Bank of Rhode Island’s Alternative Loan Program, Compass Bank
        Alternative Loan Program, FinanSure Alternative Loan Program, Navy Federal
        Alternative Loan Program, and Xanthus Alternative Loan Program.

       

      ·  Citizens
        Bank of Rhode Island, dated October 1, 2002, for loans that were originated
        under Citizens Bank of Rhode Island’s Penn State Undergraduate Loan
        Program.

       

      ·  First
        National Bank Northeast, dated August 1, 2001, for loans that were originated
        under First National Bank Northeast’s CASL Undergraduate Alternative Loan
        Program.

       

      ·  HSBC
        Bank
        USA, National Association, dated April 17, 2002, for loans that were originated
        under the HSBC Loan Program.

       

      ·  The
        Huntington National Bank, dated May 20, 2003, for loans that were originated
        under The Huntington National Bank’s Huntington Bank Education Loan
        Program.

       

      ·  KeyBank,
        dated May 12, 2006, for loans that were originated under KeyBank’s Private
        Education Loan Program.

       

      ·  Manufacturers
        and Traders Trust Company, dated April 29, 2004, for loans that were originated
        under Manufacturers and Traders Trust Company’s Alternative Loan
        Program.

       

      ·  National
        City Bank, dated July 26, 2002, for loans that were originated under National
        City Bank’s National City Loan Program.

       

      ·  PNC
        Bank,
        N.A., dated April 22, 2004, for loans that were originated under PNC Bank’s
        Alternative Conforming Loan Program, Brazos Alternative Loan Program, Edvisors
        Alternative Loan Program, GE Money Bank Alternative Loan Prorgam, Old National
        Bank Alternative Loan Program, and Regions Bank Alternative Loan
        Program..

       

      ·  Sovereign
        Bank, dated April 30, 2004, for loans that were originated under Sovereign
        Bank’s Alternative Loan Program.

       

      ·  SunTrust
        Bank, dated March 1, 2002, for loans that were originated under SunTrust
        Bank’s
        SunTrust Alternative Loan Program.

       

      ·  TCF
        National Bank, dated July 22, 2005, for loans that were originated under
        TCF
        National Bank’s Alternative Loan Program.

       

      ·  U.S.
        Bank, N.A., dated May 1, 2005, for loans that were originated under U.S Bank’s
        Alternative Loan Program.

        

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      SCHEDULE
        C

       

      LIST
        OF STUDENT LOAN PURCHASE AGREEMENTS

       

      Each
        of
        the student loan purchase agreements, as amended or supplemented, was entered
        into by and between The First Marblehead Corporation and:

       

      ·  Bank
        of
        America, N.A., dated April 30, 2001, for loans that were originated under
        Bank
        of America’s BAGEL Loan Program, TERI Alternative Loan Program and ISLP Loan
        Program.

       

      ·  Bank
        of
        America, N.A., dated June 30, 2006, for loans that were originated under
        Bank of
        America’s BAGEL Loan Program, TERI Alternative Loan Program and ISLP Loan
        Program. 

       

      ·  Bank
        of
        America, N.A., dated June 30, 2003, for loans that were originated under
        Bank of
        America’s Direct to Consumer Loan Program.

       

      ·  Bank
        of
        America, N.A., dated April 1, 2006, for loans that were originated under
        Bank of
        America’s Direct to Consumer Loan Program.

       

      ·  Bank
        One,
        N.A., dated May 1, 2002, for loans that were originated under Bank One’s
        CORPORATE ADVANTAGE Loan Program, EDUCATION ONE Loan Program, and Campus
        One
        Loan Program.

       

      ·  Charter
        One Bank, N.A., dated as of December 29, 2003 for loans that were originated
        under Charter One’s AAA Southern New England Bank Loan Program.

       

      ·  Charter
        One Bank, N.A., dated October 31, 2003, for loans that were originated under
        Charter One’s AES EducationGAIN Loan Program.

       

      ·  Charter
        One Bank, N.A., dated May 15, 2002, for loans that were originated under
        Charter
        One’s CFS Direct to Consumer Loan Program.

       

      ·  Charter
        One Bank, N.A., dated June 30, 2003, for loans that were originated under
        Charter One’s Citibank Education Assistance Loan Program.

       

      ·  Charter
        One Bank, N.A., dated July 1, 2002, for loans that were originated under
        Charter
        One’s College Loan Corporation Loan Program.

       

      ·  Charter
        One Bank, N.A., dated December 1, 2003, for loans that were originated under
        Charter One’s Custom Educredit Loan Program.

       

      ·  Charter
        One Bank, N.A., dated May 10, 2004, for loans that were originated under
        Charter
        One’s EdFinancial Loan Program.

       

      ·  Charter
        One Bank, N.A., dated September 15, 2003, for loans that were originated
        under
        Charter One’s Extra Credit II Loan Program (North Texas Higher
        Education).

       

      ·  Charter
        One Bank, N.A., dated September 20, 2003, for loans that were originated
        under
        Charter One’s M&I Alternative Loan Program.

       

      ·  Charter
        One Bank, N.A., dated November 17, 2003, for loans that were originated under
        Charter One’s National Education Loan Program.

       

      ·  Charter
        One Bank, N.A., dated May 15, 2002, for loans that were originated under
        Charter
        One’s NextStudent Alternative Loan Program.

       

      ·  Charter
        One Bank, N.A., dated March 26, 2004, for loans that were originated under
        Charter One’s NextStudent Private Consolidation Loan Program.

       

      ·  Charter
        One Bank, N.A., dated March 25, 2004, for loans that were originated under
        Charter One’s Astrive and AstriveAlliance Education Loan Programs.

       

      ·  Charter
        One Bank, N.A., dated May 15, 2003, for loans that were originated under
        Charter
        One’s WAMU Alternative Student Loan Program.

       

      ·  Charter
        One Bank, N.A., dated February 15, 2005, for loans that were originated under
        Charter One’s Referral Loan Program (including loans in the UPromise Alternative
        Loan Program, Collegiate Solutions Alternative Loan Program, College Board
        Alternative Loan Program, and Axiom Alternative Loan Programs).

       

      ·  Citizens
        Bank of Rhode Island, dated April 30, 2004, for loans that were originated
        under
        Citizens Bank of Rhode Island’s Alternative Loan Program, Compass Bank
        Alternative Loan Program, FinanSure Alternative Loan Program, Navy Federal
        Alternative Loan Program, and Xanthus Alternative Loan Program.

       

      ·  Citizens
        Bank of Rhode Island, dated October 1, 2002, for loans that were originated
        under Citizens Bank of Rhode Island’s Penn State Undergraduate Loan
        Program.

       

      ·  First
        National Bank Northeast, dated August 1, 2001, for loans that were originated
        under First National Bank Northeast’s CASL Undergraduate Alternative Loan
        Program.

       

      ·  HSBC
        Bank
        USA, National Association, dated April 17, 2002, as amended on June 2, 2003
        and
        August 1, 2003, for loans that were originated under the HSBC Loan
        Program.

       

      ·  The
        Huntington National Bank, dated May 20, 2003, for loans that were originated
        under The Huntington National Bank’s Huntington Bank Education Loan
        Program.

       

      ·  KeyBank,
        dated May 12, 2006, for loans that were originated under KeyBank’s Private
        Education Loan Program.

       

      ·  Manufacturers
        and Traders Trust Company, dated April 29, 2004, for loans that were originated
        under Manufacturers and Traders Trust Company’s Alternative Loan
        Program.

       

      ·  National
        City Bank, dated November 13, 2002, for loans that were originated under
        National City Bank’s National City Loan Program.

       

      ·  PNC
        Bank,
        N.A., dated April 22, 2004, for loans that were originated under PNC Bank’s
        Alternative Conforming Loan Program, Brazos Alternative Loan Program, Edvisors
        Alternative Loan Program, GE Money Bank Alternative Loan Prorgam, Old National
        Bank Alternative Loan Program, and Regions Bank Alternative Loan
        Program.

       

      ·  Sovereign
        Bank, dated April 30, 2004, for loans that were originated under Sovereign
        Bank’s Alternative Loan Program.

       

      ·  SunTrust
        Bank, dated March 1, 2002, for loans that were originated under SunTrust
        Bank’s
        SunTrust Alternative Loan Program.

       

      ·  TCF
        National Bank, dated July 22, 2005, for loans that were originated under
        TCF
        National Bank’s Alternative Loan Program.

       

      ·  U.S.
        Bank, N.A., dated May 1, 2005, for loans that were originated under U.S Bank’s
        Alternative Loan Program.

       

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-1

       

      FORM
        OF CLASS A-1 NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

       

      STUDENT
        LOAN ASSET BACKED NOTES

       

      CLASS
        A-1

       

      

      
        	
                No.
                  A-1-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                September
                  25, 2019

              	
                ______
                  __, 200_

              	
                63543V
                  AA 1

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$323,600,000**

              	
                US63543VAA17

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897351

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class A-1 Notes (defined herein) shall be in default, Class A-1 Notes
        issued
        in lieu of such Class A-1 Notes surrendered for transfer or exchange shall
        bear
        interest from the date to which interest has been paid in full on the Class
        A-1
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class A-1 Note at the rate per annum equal
        to
        the Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class A-1 (the “Class A-1 Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class A-1 Notes. The Class A-1 Notes, together
        with any additional notes issued pursuant to the Indenture are collectively
        referred to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class A-1 Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class A-1 Notes.

       

      The
        Class
        A-1 Notes are issuable as registered notes in the minimum denomination of
        $100,000 and $1,000 integral multiples in excess thereof. Subject to the
        limitations provided in the Indenture and upon payment of any tax or
        governmental charge, Class A-1 Notes may be exchanged for a like Class and
        aggregate principal amount of Class A-1 Notes of other authorized
        denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared
        that all
        acts, conditions and things required to be done, to exist, to happen and
        to be
        performed in order to make this Note a valid and binding obligation of the
        Issuer according to its terms have been done, do exist, have happened and
        have
        been performed in regular and due form, time and manner as so
        required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof,
        The
        National Collegiate Student Loan Trust 2006-3 has caused this note to be
        executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

      
        	
                Attest

              
	 
	
                 

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        note
        is one of the Class A-1 Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-2

       

      FORM
        OF CLASS A-2 NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        A-2

       

      

      
        	
                No.
                  A-2-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                March
                  25, 2026

              	
                ______
                  __, 200_

              	
                63543V
                  AB 9

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$306,230,000**

              	
                US63543VAB99

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897386

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class A-2 Notes (defined herein) shall be in default, Class A-2 Notes
        issued
        in lieu of such Class A-2 Notes surrendered for transfer or exchange shall
        bear
        interest from the date to which interest has been paid in full on the Class
        A-2
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class A-2 Note at the rate per annum equal
        to
        the Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class A-2 (the “Class A-2 Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class A-2 Notes. The Class A-2 Notes, together
        with any additional notes issued pursuant to the Indenture are collectively
        referred to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class A-2 Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class A-2 Notes.

       

      The
        Class
        A-2 Notes are issuable as registered notes in the minimum denomination of
        $100,000 and $1,000 integral multiples in excess thereof. Subject to the
        limitations provided in the Indenture and upon payment of any tax or
        governmental charge, Class A-2 Notes may be exchanged for a like Class and
        aggregate principal amount of Class A-2 Notes of other authorized
        denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared
        that all
        acts, conditions and things required to be done, to exist, to happen and
        to be
        performed in order to make this Note a valid and binding obligation of the
        Issuer according to its terms have been done, do exist, have happened and
        have
        been performed in regular and due form, time and manner as so
        required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof,
        The
        National Collegiate Student Loan Trust 2006-3 has caused this note to be
        executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class A-2 Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-3

       

      FORM
        OF CLASS A-3 NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        A-3

       

      

      
        	
                No.
                  A-3-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                October
                  25, 2027

              	
                ______
                  __, 200_

              	
                63543V
                  AC 7

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$322,790,000**

              	
                US63543VAC72

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897416

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class A-3 Notes (defined herein) shall be in default, Class A-3 Notes
        issued
        in lieu of such Class A-3 Notes surrendered for transfer or exchange shall
        bear
        interest from the date to which interest has been paid in full on the Class
        A-3
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class A-3 Note at the rate per annum equal
        to
        the Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class A-3 (the “Class A-3 Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class A-3 Notes. The Class A-3 Notes, together
        with any additional notes issued pursuant to the Indenture are collectively
        referred to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class A-3 Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class A-3 Notes.

       

      The
        Class
        A-3 Notes are issuable as registered notes in the minimum denomination of
        $100,000 and $1,000 integral multiples in excess thereof. Subject to the
        limitations provided in the Indenture and upon payment of any tax or
        governmental charge, Class A-3 Notes may be exchanged for a like Class and
        aggregate principal amount of Class A-3 Notes of other authorized
        denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared
        that all
        acts, conditions and things required to be done, to exist, to happen and
        to be
        performed in order to make this Note a valid and binding obligation of the
        Issuer according to its terms have been done, do exist, have happened and
        have
        been performed in regular and due form, time and manner as so
        required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof,
        The
        National Collegiate Student Loan Trust 2006-3 has caused this note to be
        executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class A-3 Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-4

       

      FORM
        OF CLASS A-4 NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        A-4

       

      

      
        	
                No.
                  A-4-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                March
                  26, 2029

              	
                ______
                  __, 200_

              	
                63543V
                  AD 5

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$294,510,000**

              	
                US63543VAD55

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897459

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class A-4 Notes (defined herein) shall be in default, Class A-4 Notes
        issued
        in lieu of such Class A-4 Notes surrendered for transfer or exchange shall
        bear
        interest from the date to which interest has been paid in full on the Class
        A-4
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class A-4 Note at the rate per annum equal
        to
        the Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class A-4 (the “Class A-4 Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class A-4 Notes. The Class A-4 Notes, together
        with any additional notes issued pursuant to the Indenture are collectively
        referred to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class A-4 Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class A-4 Notes.

       

      The
        Class
        A-4 Notes are issuable as registered notes in the minimum denomination of
        $100,000 and $1,000 integral multiples in excess thereof. Subject to the
        limitations provided in the Indenture and upon payment of any tax or
        governmental charge, Class A-4 Notes may be exchanged for a like Class and
        aggregate principal amount of Class A-4 Notes of other authorized
        denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared
        that all
        acts, conditions and things required to be done, to exist, to happen and
        to be
        performed in order to make this Note a valid and binding obligation of the
        Issuer according to its terms have been done, do exist, have happened and
        have
        been performed in regular and due form, time and manner as so
        required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof,
        The
        National Collegiate Student Loan Trust 2006-3 has caused this note to be
        executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class A-4 Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-5

       

      FORM
        OF CLASS A-5
        NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        A-5

       

      

      
        	
                No.
                  A-5-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                October
                  27, 2031

              	
                ______
                  __, 200_

              	
                63543V
                  AE 3

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$325,130,000**

              	
                US63543VAE39

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897491

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class A-5 Notes (defined herein) shall be in default, Class A-5 Notes
        issued
        in lieu of such Class A-5 Notes surrendered for transfer or exchange shall
        bear
        interest from the date to which interest has been paid in full on the Class
        A-5
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class A-5 Note at the rate per annum equal
        to
        the Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class A-5 (the “Class A-5 Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class A-5 Notes. The Class A-5 Notes, together
        with any additional notes issued pursuant to the Indenture are collectively
        referred to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class A-5 Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class A-5 Notes.

       

      The
        Class
        A-5 Notes are issuable as registered notes in the minimum denomination of
        $100,000 and $1,000 integral multiples in excess thereof. Subject to the
        limitations provided in the Indenture and upon payment of any tax or
        governmental charge, Class A-5 Notes may be exchanged for a like Class and
        aggregate principal amount of Class A-5 Notes of other authorized
        denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared
        that all
        acts, conditions and things required to be done, to exist, to happen and
        to be
        performed in order to make this Note a valid and binding obligation of the
        Issuer according to its terms have been done, do exist, have happened and
        have
        been performed in regular and due form, time and manner as so
        required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof,
        The
        National Collegiate Student Loan Trust 2006-3 has caused this note to be
        executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class A-5 Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 
	 	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
          

        

      

       

      EXHIBIT
        A-6

       

      FORM
        OF CLASS A-IO NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        A-IO

       

      

      
        	
                No.
                  A-IO-__

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                7.10%

              	
                January
                  25, 2012

              	
                ______
                  __, 200_

              	
                63543V
                  AF 0

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	 	 	
                US63543VAF04

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897521

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class A-IO Notes (defined herein) shall be in default, Class A-IO Notes
        issued in lieu of such Class A-IO Notes surrendered for transfer or exchange
        shall bear interest from the date to which interest has been paid in full
        on the
        Class A-IO Notes surrendered until payment of the principal hereof has been
        made
        or duly provided for. Principal of this note is payable upon the presentation
        and surrender hereof at the principal corporate trust office of U.S. Bank
        National Association, as indenture trustee (the “Indenture Trustee”). Interest
        on this note is payable to the Registered Owner of record as of the close
        of
        business on the applicable record date as shown on the registration books
        of the
        Issuer maintained by the Indenture Trustee in its capacity as bond registrar,
        or
        its successor in such capacity, by check or draft mailed to the Registered
        Owner
        at the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on the Notional Amount of this Class A-IO Note at
        the
        rate per annum equal to the Note Interest Rate (as defined in the Indenture)
        for
        this Note, on each Distribution Date until the Notional Amount of this Class
        A-IO Note is reduced to zero. Interest on this Class A-IO Note will accrue
        for
        each Distribution Date on the Notional Amount of the Class A-IO Note until
        such
        Notional Amount is reduced to zero, from the most recent Distribution Date
        on
        which interest has been paid to but excluding such Distribution Date or,
        if no
        interest has yet been paid, from the Closing Date). Such principal of and
        interest on this Note shall be paid in the manner specified herein.

       

      Interest
        on this Note is 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.

       

      This
        Note
        also is entitled to receive Prepayment Penalties as described in the
        Indenture.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class A-IO (the “Class A-IO Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class A-IO Notes. The Class A-IO Notes,
        together with any additional notes issued pursuant to the Indenture are
        collectively referred to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class A-IO Notes have been issued and provisions made for their security
        and for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class A-IO Notes.

       

      The
        Class
        A-IO Notes are issuable as registered notes in the minimum denomination of
        $100,000 and $1,000 integral multiples in excess thereof. Subject to the
        limitations provided in the Indenture and upon payment of any tax or
        governmental charge, Class A-IO Notes may be exchanged for a like Class and
        aggregate principal amount of Class A-IO Notes of other authorized
        denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared that all acts, conditions and
        things required to be done, to exist, to happen and to be performed in order
        to
        make this Note a valid and binding obligation of the Issuer according to
        its
        terms have been done, do exist, have happened and have been performed in
        regular
        and due form, time and manner as so required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof, The National Collegiate Student Loan Trust 2006-3 has
        caused this note to be executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class A-IO Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-7

       

      FORM
        OF CLASS B NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        B

       

      

      
        	
                No.
                  B-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                January
                  26, 2032

              	
                ______
                  __, 200_

              	
                63543V
                  AG 8

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$94,810,000**

              	
                US63543VAG86

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897572

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class B Notes (defined herein) shall be in default, Class B Notes issued
        in
        lieu of such Class B Notes surrendered for transfer or exchange shall bear
        interest from the date to which interest has been paid in full on the Class
        B
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class B Note at the rate per annum equal
        to the
        Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class B (the “Class B Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class B Notes. The Class B Notes, together
        with
        any additional notes issued pursuant to the Indenture are collectively referred
        to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class B Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class B Notes.

       

      The
        Class
        B Notes are issuable as registered notes in the minimum denomination of $100,000
        and $1,000 integral multiples in excess thereof. Subject to the limitations
        provided in the Indenture and upon payment of any tax or governmental charge,
        Class B Notes may be exchanged for a like Class and aggregate principal amount
        of Class B Notes of other authorized denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared that all acts, conditions and
        things required to be done, to exist, to happen and to be performed in order
        to
        make this Note a valid and binding obligation of the Issuer according to
        its
        terms have been done, do exist, have happened and have been performed in
        regular
        and due form, time and manner as so required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof, The National Collegiate Student Loan Trust 2006-3 has
        caused this note to be executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class B Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 
	 	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-8

       

      FORM
        OF CLASS C NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        C

       

      

      
        	
                No.
                  C-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                February
                  25, 2032

              	
                ______
                  __, 200_

              	
                63543V
                  AH 6

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$92,450,000
                  **

              	
                US63543VAH69

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897637

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class C Notes (defined herein) shall be in default, Class C Notes issued
        in
        lieu of such Class C Notes surrendered for transfer or exchange shall bear
        interest from the date to which interest has been paid in full on the Class
        C
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class C Note at the rate per annum equal
        to the
        Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class C (the “Class C Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class C Notes. The Class C Notes, together
        with
        any additional notes issued pursuant to the Indenture are collectively referred
        to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class C Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class C Notes.

       

      The
        Class
        C Notes are issuable as registered notes in the minimum denomination of $100,000
        and $1,000 integral multiples in excess thereof. Subject to the limitations
        provided in the Indenture and upon payment of any tax or governmental charge,
        Class C Notes may be exchanged for a like Class and aggregate principal amount
        of Class C Notes of other authorized denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared that all acts, conditions and
        things required to be done, to exist, to happen and to be performed in order
        to
        make this Note a valid and binding obligation of the Issuer according to
        its
        terms have been done, do exist, have happened and have been performed in
        regular
        and due form, time and manner as so required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof, The National Collegiate Student Loan Trust 2006-3 has
        caused this note to be executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class C Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 
	 	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        A-9

       

      FORM
        OF CLASS
        D NOTE

       

      UNLESS
        THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
        TRUST
        COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE INDENTURE TRUSTEE, THE REGISTRAR
        OR ANY AGENT THEREOF 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
        PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
        HAVE
        REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
        BEHALF
        OF, AS A FIDUCIARY OF, OR WITH “PLAN ASSETS” (WITHIN THE MEANING OF SECTION
        2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE “PLAN ASSET
        REGULATION”)) OF, AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE
        EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)), A “PLAN”
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986
        (THE
“CODE”)) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
        REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
        ERISA OR SECTION 4975 OF THE CODE (A “PLAN”), OR (II)(A) THIS NOTE IS RATED
        INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
        HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
        WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
        AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE
        NOTE
        DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA
        OR
        SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
        INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1
        OR
        84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE BACK-UP
        ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE
        OWNER
        TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING
        A
“PARTY IN INTEREST” (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
        TO SUCH PLAN.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      THE
        NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

      STUDENT
        LOAN ASSET BACKED NOTES

      CLASS
        D

       

      

      
        	
                No.
                  D-___

              
	 
	
                Interest
                  Rate

              	
                Date
                  of Maturity

              	
                Dated
                  Date

              	
                CUSIP

              
	
                Variable

              	
                March
                  25, 2032

              	
                ______
                  __, 200_

              	
                63543V
                  AJ 2

              
	 	 	 
	
                REGISTERED
                  OWNER:

              	
                **CEDE
                  & CO.**

              	
                ISIN

              
	
                PRINCIPAL
                  AMOUNT:

              	
                **$83,870,000**

              	
                US63543VAJ26

              
	 	 	 
	 	 	
                European
                  Common Code

              
	 	 	
                026897696

              
	 	 	 

      

      

      The
        National Collegiate Student Loan Trust 2006-3, a statutory trust duly organized
        and validly existing under the laws of the State of Delaware (the “Issuer”), for
        value received, hereby promises to pay, but only from the sources and as
        hereinafter provided, to the Registered Owner specified above, or registered
        assigns, the Principal Amount shown above in lawful money of the United States
        of America on the Date of Maturity shown above, unless prepaid prior thereto
        with interest thereon from the Distribution Date next preceding the date
        of
        authentication hereof, unless such date of authentication is prior to the
        first
        Distribution Date, in which case this note shall bear interest from the Dated
        Date specified above or unless such date of authentication is a Distribution
        Date, in which case this note shall bear interest from such Distribution
        Date;
provided,
        however,
        that if
        as shown by the records of the Indenture Trustee (defined herein) interest
        on
        the Class D Notes (defined herein) shall be in default, Class D Notes issued
        in
        lieu of such Class D Notes surrendered for transfer or exchange shall bear
        interest from the date to which interest has been paid in full on the Class
        D
        Notes surrendered until payment of the principal hereof has been made or
        duly
        provided for. Principal of this note is payable upon the presentation and
        surrender hereof at the principal corporate trust office of U.S. Bank National
        Association, as indenture trustee (the “Indenture Trustee”). Interest on this
        note is payable to the Registered Owner of record as of the close of business
        on
        the applicable record date as shown on the registration books of the Issuer
        maintained by the Indenture Trustee in its capacity as bond registrar, or
        its
        successor in such capacity, by check or draft mailed to the Registered Owner
        at
        the registered address.

       

      Any
        capitalized words and terms used as defined words and terms in this note
        and not
        otherwise defined herein shall have the meanings given them in the Indenture
        (hereinafter defined).

       

      The
        Issuer will pay interest on this Class D Note at the rate per annum equal
        to the
        Note Interest Rate (as defined in the Indenture) for this Note, on each
        Distribution Date until the principal of this Note is paid or made available
        for
        payment, on the principal amount of this Note Outstanding on the preceding
        Distribution Date (after giving effect to all payments of principal made
        on the
        preceding Distribution Date). Interest on this Note will accrue for each
        Distribution Date from the most recent Distribution Date on which interest
        has
        been paid to but excluding such Distribution Date or, if no interest has
        yet
        been paid, from the Closing Date). Such principal of and interest on this
        Note
        shall be paid in the manner specified herein.

       

      The
        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.

       

      This
        Note
        is one of a duly authorized class of notes of the Issuer designated Student
        Loan
        Asset Backed Notes, Class D (the “Class D Notes”), issued pursuant to the
        Indenture, dated as of September 1, 2006, between the Issuer and the Indenture
        Trustee, as indenture trustee (such indenture, as supplemented or amended
        from
        time to time in accordance with its terms, the “Indenture”).

       

      The
        Indenture pledges for the payment of the Notes (as hereinafter defined) the
        student loans identified in the Indenture (the “Financed Student Loans”) and the
        payments of interest and the repayments of principal with respect thereto,
        including certain guarantees related thereto, as well as certain other rights,
        funds and accounts of the Issuer set forth in the Indenture, including a
        Reserve
        Account (collectively, the “Trust Estate”).

       

      This
        Note
        is a limited obligation of the Issuer, payable solely from the principal
        and
        interest on Financed Student Loans financed pursuant to the Indenture, any
        guaranty payments thereon received by the Issuer, and certain other revenues
        and
        earnings to be held pursuant to the Indenture, all in an amount and in the
        manner provided in the Indenture. Additional notes and other obligations
        may be
        issued or entered into under the Indenture the right to payment of which
        is
        equal with or subordinate to the Class D Notes. The Class D Notes, together
        with
        any additional notes issued pursuant to the Indenture are collectively referred
        to herein as “Notes.”

       

      The
        Notes
        are secured as provided in the Indenture, but solely by the pledge of the
        Trust
        Estate described in the Indenture; provided that the rights of the holders
        of
        the Class A Notes shall be superior to the rights of the Registered Owners
        of
        Class B Notes, Class C Notes and Class D Notes. Reference is made to the
        Indenture for a complete statement of the terms and conditions upon which
        the
        Class D Notes have been issued and provisions made for their security and
        for
        the rights, duties and obligations of the Issuer, the Indenture Trustee and
        the
        Registered Owners of the Class D Notes.

       

      The
        Class
        D Notes are issuable as registered notes in the minimum denomination of $100,000
        and $1,000 integral multiples in excess thereof. Subject to the limitations
        provided in the Indenture and upon payment of any tax or governmental charge,
        Class D Notes may be exchanged for a like Class and aggregate principal amount
        of Class D Notes of other authorized denominations.

       

      The
        Registered Owner of this Note shall have no right to enforce the provisions
        of
        the Indenture or to institute action to enforce the covenants therein, or
        to
        take any action with respect to any Event of Default under the Indenture,
        or to
        institute, appear in or defend any suit or other proceedings with respect
        thereto, except as provided in the Indenture. If an Event of Default under
        the
        Indenture occurs, the principal of all Notes then Outstanding issued under
        the
        Indenture may be declared due and payable upon the conditions and in the
        manner
        and with the effect provided in the Indenture.

       

      It
        Is Hereby Certified, Recited And Declared that all acts, conditions and
        things required to be done, to exist, to happen and to be performed in order
        to
        make this Note a valid and binding obligation of the Issuer according to
        its
        terms have been done, do exist, have happened and have been performed in
        regular
        and due form, time and manner as so required.

       

      The
        Issuer and the Indenture Trustee may deem and treat the person in whose name
        this Note is registered upon the registration books as the absolute owner
        hereof, whether this Note is overdue or not, for the purpose of receiving
        payment of or on account of the principal or interest and for all other
        purposes, and all such payments so made to the Registered Owner or upon such
        Registered Owner’s order shall be valid and effectual to satisfy and discharge
        the liability on this note to the extent of the sum or sums so paid, and
        neither
        the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
        notice to the contrary.

       

      This
        Note
        shall not be valid or become obligatory for any purpose or be entitled to
        any
        security or benefit under the Indenture until the Certificate of Authentication
        hereon shall have been executed by the Indenture Trustee.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      In
        Witness Whereof, The National Collegiate Student Loan Trust 2006-3 has
        caused this note to be executed and attested.

       

      

       

      
        	
                THE
                  NATIONAL COLLEGIATE STUDENT LOAN TRUST 2006-3

                 

              
	
                By:

              	
                WILMINGTON
                  TRUST COMPANY, not in its individual capacity but solely as Owner
                  Trustee

                 

              
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        	
                Attest

              	 
	 	 
	
                 

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      CERTIFICATE
        OF AUTHENTICATION

       

      This
        Note
        is one of the Class D Notes and described in the provisions of the
        within-mentioned Indenture.

       

      

      
        	
                Date
                  of Authentication: __________________

              	 
	 	 

      

      

      
        	
                U.S.
                  BANK NATIONAL ASSOCIATION,
                  as
                  Authenticating Agent 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      ASSIGNMENT

       

      For
        Value
        Received _____________________ hereby sell(s), assign(s) and transfer(s)
        unto

       

      

      
        	 	 
	 
	
                (Please
                  print or type an address

              	
                (Social
                  Security number

              
	
                including
                  postal zip code of transferee)

              	
                of
                  transferee)

              

      

      

      the
        within Note, together with accrued interest thereon and all right, title
        and
        interest thereto, and hereby irrevocably authorize(s) and appoint(s)
        _______________________________________ attorney to transfer said Note on
        the
        books of the within named Corporation with full power of substitution in
        the
        premises.

       

      

      
        	 	 
	 	 
	
                Dated
                  ________________

              	
                ________________________________L.S.

              
	 	 
	
                Guaranteed
                  by:

              	 
	 	 
	 	 
	 	 
	
                _____________________________________

              	 

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
          

        

      

       

      EXHIBIT
        B

       

      [RESERVED]

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
        C

       

      RELEVANT
        SERVICING CRITERIA

       

      

      
        	 	
                Servicing
                  Criteria

              	
                Applicable
                  Servicing Criteria

              
	
                Reference

              	
                Criteria

              	 
	 	
                General
                  Servicing Considerations

              	 
	
                1122(d)(1)(i)

              	
                Policies
                  and procedures are instituted to monitor any performance or other
                  triggers
                  and events of default in accordance with the transaction
                  agreements.

              	 
	
                1122(d)(1)(ii)

              	
                If
                  any material servicing activities are outsourced to third parties,
                  policies and procedures are instituted to monitor the third party’s
                  performance and compliance with such servicing activities.

              	 
	
                1122(d)(1)(iii)

              	
                Any
                  requirements in the transaction agreements to maintain a back-up
                  servicer
                  for the pool assets are maintained.

              	 
	
                1122(d)(1)(iv)

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

              	 
	 	
                Cash
                  Collection and Administration

              	 
	
                1122(d)(2)(i)

              	
                Payments
                  on pool assets are deposited into the appropriate custodial bank
                  accounts
                  and related bank clearing accounts no more than two business days
                  following receipt, or such other number of days specified in the
                  transaction agreements.

              	
                X

              
	
                1122(d)(2)(ii)

              	
                Disbursements
                  made via wire transfer on behalf of an obligor or to an investor
                  are made
                  only by authorized personnel.

              	
                X

              
	
                1122(d)(2)(iii)

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

              	 
	
                1122(d)(2)(iv)

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

              	
                X

              
	
                1122(d)(2)(v)

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

              	 
	
                1122(d)(2)(vi)

              	
                Unissued
                  checks are safeguarded so as to prevent unauthorized
                  access.

              	 
	
                1122(d)(2)(vii)

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

              	
                X

              
	 	
                Investor
                  Remittances and Reporting

              	 
	
                1122(d)(3)(i)

              	
                Reports
                  to investors, including those to be filed with the Commission,
                  are
                  maintained in accordance with the transaction agreements and applicable
                  Commission requirements. Specifically, such reports (A) are prepared
                  in
                  accordance with timeframes and other terms set forth in the transaction
                  agreements; (B) provide information calculated in accordance with
                  the
                  terms specified in the transaction agreements; (C) are filed with
                  the
                  Commission as required by its rules and regulations; and (D) agree
                  with
                  investors’ or the trustee’s records as to the total unpaid principal
                  balance and number of pool assets serviced by the
                  Servicer.

              	 
	
                1122(d)(3)(ii)

              	
                Amounts
                  due to investors are allocated and remitted in accordance with
                  timeframes,
                  distribution priority and other terms set forth in the transaction
                  agreements.

              	 
	
                1122(d)(3)(iii)

              	
                Disbursements
                  made to an investor are posted within two business days to the
                  Servicer’s
                  investor records, or such other number of days specified in the
                  transaction agreements.

              	
                X

              
	
                1122(d)(3)(iv)

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

              	
                X

              
	 	
                Pool
                  Asset Administration

              	 
	
                1122(d)(4)(i)

              	
                Collateral
                  or security on pool assets is maintained as required by the transaction
                  agreements or related pool asset documents.

              	 
	
                1122(d)(4)(ii)

              	
                Pool
                  asset and related documents are safeguarded as required by the
                  transaction
                  agreements.

              	 
	
                1122(d)(4)(iii)

              	
                Any
                  additions, removals or substitutions to the asset pool are made,
                  reviewed
                  and approved in accordance with any conditions or requirements
                  in the
                  transaction agreements.

              	 
	
                1122(d)(4)(iv)

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

              	 
	
                1122(d)(4)(v)

              	
                The
                  Servicer’s records regarding the pool assets agree with the Servicer’s
                  records with respect to an obligor’s unpaid principal
                  balance.

              	 
	
                1122(d)(4)(vi)

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

              	 
	
                1122(d)(4)(vii)

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

              	 
	
                1122(d)(4)(viii)

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

              	 
	
                1122(d)(4)(ix)

              	
                Adjustments
                  to interest rates or rates of return for pool assets with variable
                  rates
                  are computed based on the related pool asset documents.

              	 
	
                1122(d)(4)(x)

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

              	 
	
                1122(d)(4)(xi)

              	
                Payments
                  made on behalf of an obligor (such as tax or insurance payments)
                  are made
                  on or before the related penalty or expiration dates, as indicated
                  on the
                  appropriate bills or notices for such payments, provided that such
                  support
                  has been received by the servicer at least 30 calendar days prior
                  to these
                  dates, or such other number of days specified in the transaction
                  agreements.

              	 
	
                1122(d)(4)(xii)

              	
                Any
                  late payment penalties in connection with any payment to be made
                  on behalf
                  of an obligor are paid from the servicer’s funds and not charged to the
                  obligor, unless the late payment was due to the obligor’s error or
                  omission.

              	 
	
                1122(d)(4)(xiii)

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

              	 
	
                1122(d)(4)(xiv)

              	
                Delinquencies,
                  charge-offs and uncollectible accounts are recognized and recorded
                  in
                  accordance with the transaction agreements.

              	 
	
                1122(d)(4)(xv)

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

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