Document:

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                        NEW CENTURY FINANCIAL CORPORATION

                                  COMMON STOCK
                           (PAR VALUE $.01 PER SHARE)

                           PLACEMENT AGENCY AGREEMENT

                                  July 19, 2001

Friedman, Billings, Ramsey & Co., Inc.
1001 Nineteenth Street North
Arlington, Virginia 22209

Ladies/Gentlemen:

      New Century Financial Corporation, a Delaware corporation (the "COMPANY"),
proposes to issue and sell shares of the Company's Common Stock, par value $.01
per share (the "SHARES") in a minimum amount of $15 million ("MINIMUM PROCEEDS")
to certain investors (collectively, the "INVESTORS") in a private placement at a
price per share to Investors of $10.40 (the "OFFERING"). The Company hereby
confirms the following agreements with you.

      1. AGREEMENT TO ACT AS PLACEMENT AGENT. On the basis of the
representations, warranties and agreements of the Company herein contained and
subject to all the terms and conditions of this Agreement, Friedman, Billings,
Ramsey & Co., Inc. (the "PLACEMENT AGENT") agrees to be appointed the Company's
exclusive placement agent, on a reasonable commercial efforts basis, in
connection with the issuance and sale by the Company of the Shares to the
Investors. It is understood that the Placement Agent has no commitment to
purchase or sell the Shares. As compensation for services rendered, at the
Closing (as defined below), the Placement Agent shall remit to the Company $9.81
per share based on funds that it receives directly from Investors. If any funds
are received by the Company directly from any Investors for the purchase of
Shares, the Company shall pay to the Placement Agent at the Closing a fee of
$0.59 per share on any amounts so received by the Company directly from
Investors.

      2. DELIVERY AND PAYMENT.

            (a) Subscriptions for Shares shall be evidenced by the execution by
Investors of the Purchase Agreement. The Purchase Agreement shall not be
effective unless and until it is accepted by the Company. Until subscriptions
for the Minimum Proceeds have been received and funds representing the sale
thereof have cleared, all subscription funds received shall be held by the
Placement Agent. The Placement Agent shall not have any obligation to
independently verify the accuracy or completeness of any information contained
in the Purchase Agreement.

            (b) The completion of the purchase and sale of the Shares shall take
place at the closing (the "CLOSING") and shall occur at such place and such time
(the "CLOSING DATE") as

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specified by the Company and the Placement Agent, and of which the Investors
will be notified in advance by the Placement Agent.

            (c) The Company's obligation to issue the Shares to the Investors,
and the Investors' obligations to purchase the Shares, shall be subject to the
terms and conditions contained in the Purchase Agreement.

      3. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.

      Except as set forth in the Disclosure Schedules of the Company attached
hereto, the Company represents and warrants to and agrees with the Placement
Agent that:

            (a) Since January 1, 1999, the Company has timely filed all reports,
schedules, forms, statements and other documents required to be filed by it with
the Securities and Exchange Commission ("SEC") pursuant to the reporting
requirements of the Securities Exchange Act of 1934, as amended ("EXCHANGE ACT")
(all of the foregoing filed prior to the date hereof and all exhibits included
therein and financial statements and schedules thereto and documents
incorporated by reference therein, being hereinafter referred to as the "SEC
DOCUMENTS"). As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the Exchange Act or the Securities
Act of 1933, as amended ("SECURITIES ACT"), as the case may be, and the rules
and regulations of the SEC promulgated thereunder applicable to the SEC
Documents, and none of the SEC Documents, at the time they were filed with the
SEC, contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

            (b) As of their respective dates, the consolidated financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. Such financial statements
have been prepared in accordance with U.S. generally accepted accounting
principles, consistently applied, during the periods involved (except (a) as may
be otherwise indicated in such financial statements or the notes thereto, or (b)
in the case of unaudited interim consolidated statements, to the extent they may
not include footnotes or may be condensed or summary statements) and fairly
present in all material respects the consolidated financial position of the
Company as of the dates thereof and the consolidated results of its operations
and cash flows for the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments).

            (c) Since March 31, 2001, there has not been (a) any material
adverse change or any development involving a prospective material adverse
change in or affecting the condition, financial or otherwise, or in the
earnings, assets or business affairs of the Company, whether or not arising in
the ordinary course of business, (b) any transactions entered into by the
Company, other than those in the ordinary course of business, which are material
with respect to the Company, (c) any dividend or distribution of any kind
declared, paid or made on the capital stock of the Company or (d) any loss or
damage (whether or not insured) to the physical property

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or assets of the Company which has a material adverse effect on the business,
operations, assets or financial condition of the Company on a consolidated basis
("MATERIAL ADVERSE EFFECT").

            (d) The Company is duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware with
corporate power and authority to own, lease and operate its properties and
conduct its business as described in the SEC Documents, and is duly qualified to
transact business and is in good standing in each other jurisdiction in which
the conduct of its business or its ownership or leasing of property requires
such qualification, except where the failure to be so qualified or in good
standing is not reasonably likely to have a Material Adverse Effect. No
proceeding has been instituted in any such jurisdiction with respect to the
Company to revoke, limit or curtail, or that seeks to revoke, limit or curtail,
such power and authority or qualification.

            (e) The Company does not own or control, directly or indirectly, any
corporation, association or other entity, other than those entities described on
Schedule 3(e) attached hereto (each, a "SUBSIDIARY"). Each Subsidiary is duly
incorporated and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation, with corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the SEC Documents, and is duly qualified to transact business in each other
jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification and in which the failure to be so qualified
is not reasonably likely to have a Material Adverse Effect. No proceeding has
been instituted in any such jurisdiction with respect to any Subsidiary to
revoke, limit or curtail, or that seeks to revoke, limit or curtail, such power
and authority or qualification. All the outstanding shares of capital stock of,
or other form of ownership interest in, each Subsidiary have been duly
authorized and issued and are fully paid and non-assessable and, except as set
forth in the SEC Documents or Schedule 3(e), are owned directly or indirectly by
the Company free and clear of all liens, encumbrances, security interests or
claims. There are no outstanding options, warrants or other rights calling for
the issuance of, and, except as described in the SEC Documents, there are no
commitments or arrangements to issue, any shares of capital stock of any
Subsidiary or any security convertible or exchangeable or exercisable for
capital stock of any Subsidiary.

            (f) The Company has corporate power and authority to enter into this
Agreement and to perform the transactions contemplated hereby. This Agreement
has been duly authorized, executed and delivered by the Company, and constitutes
a valid and binding agreement of the Company, enforceable in accordance with its
terms, except as rights to indemnification hereunder may be limited by
applicable law and except as the enforcement hereof or thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally or by general
equitable principles.

            (g) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement does not
contravene any provision of applicable law or the Certificate of Incorporation,
as amended, or Bylaws, as amended, of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries, or any judgment,
order or decree of any governmental body, agency or court having jurisdiction
over the Company or any subsidiary, and no consent, approval, authorization or

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order of or qualification with any governmental body or agency is required for
the performance by the Company of its obligations under this Agreement, except
such as may be required by (i) the securities or Blue Sky laws of the various
states, and (ii) the applicable securities laws of any jurisdiction outside the
United States in connection with the offer and sale of the Shares.

            (h) The Company has an authorized, issued and outstanding
capitalization that conforms to the description thereof contained in the SEC
Documents. The Company has not issued any shares of capital stock of the Company
since March 31, 2001, other than pursuant to (i) outstanding warrants or options
disclosed in the SEC Documents or (ii) pursuant to employee benefit plans
disclosed in the SEC Documents. The outstanding shares of Common Stock of the
Company and the Shares to be sold pursuant to the Purchase Agreement conform in
all material respects to the description of the Company's Common Stock contained
in the Company's Registration Statement on form S-1 (File No. 333-25483)
declared effective on June 25, 1997, have been duly and validly authorized, and
the Shares to be sold pursuant to the Purchase Agreement, when issued and paid
for in accordance with the terms of the Purchase Agreement, will be duly and
validly issued, fully paid and non-assessable. Except as disclosed in the SEC
Documents, no preemptive right, right of first refusal granted by the Company or
other similar right exists with respect to the Shares or the issuance and sale
thereof except for such rights which have been waived and subject to any
adjustment to the conversion rights of the outstanding shares of the Company's
Series 1998A and 1999A Preferred Stock as a result of issuance of the Shares.
The outstanding shares of Preferred Stock of the Company conform in all material
respects to the description thereof contained in the Disclosure Schedules
attached hereto, have been duly and validly authorized and issued and are fully
paid and non-assessable, have been issued and sold in compliance with applicable
Federal and state securities laws and were not issued in violation of any
preemptive rights, rights of first refusal granted by the Company or other
similar rights. Except as described in the SEC Documents, there are no
outstanding options, warrants or other rights calling for the issuance of, and
there are no commitments or arrangements to issue, any shares of capital stock
of the Company or any security convertible or exchangeable or exercisable for
capital stock of the Company. Except as disclosed in the SEC Documents, there
are no stockholder agreements, voting agreements or other similar agreements
with respect to the capital stock of the Company to which the Company is a party
or, to the knowledge of the Company, between or among any of the Company's
stockholders.

            (i) There is no material legal or governmental proceeding pending
or, to the knowledge of the Company, threatened or contemplated, to which the
Company or any Subsidiary is or may be a party or of which the business or
property of the Company or any Subsidiary is or may be subject that is not
disclosed in the SEC Documents.

            (j) Neither the Company nor any Subsidiary is in violation of its
charter, bylaws, or other organizational document, or in violation of any law,
administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority applicable to the Company or any
Subsidiary, which violation, individually or in the aggregate, is reasonably
likely to have a Material Adverse Effect, or is in default in any material
respect in the performance of any obligation, agreement or condition contained
in any bond, debenture, note or any other evidence of indebtedness in any
indenture, mortgage, deed of trust or any other

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agreement or instrument to which the Company or any Subsidiary is a party or by
which the Company or any Subsidiary is bound or by which the properties of the
Company or any Subsidiary are bound or affected, which default, individually or
in the aggregate, is reasonably likely to have a Material Adverse Effect, and
there exists no condition which, with the passage of time or otherwise, would
constitute a material default under any such document or instrument or result in
the imposition of any material penalty or the acceleration of any material
indebtedness, which condition, individually or in the aggregate, is reasonably
likely to have a Material Adverse Effect.

            (k) KPMG LLP, who have certified certain consolidated financial
statements of the Company and its Subsidiaries and delivered their report with
respect to the audited consolidated financial statements and schedules included
in the SEC Documents, are independent public accountants as required by the
Securities Act and the rules and regulations promulgated thereunder.

            (l) Except as set forth in the SEC Documents, the agreements to
which the Company or any of its Subsidiaries is a party and which are described
in the SEC Documents are valid agreements, enforceable by the Company and its
Subsidiaries (as applicable) except as the enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally or by general
equitable principles and, to the best of the Company's knowledge, the other
contracting party or parties thereto are not in material breach or material
default under any of such agreements, in each case, where such breach or default
is reasonably likely to have a Material Adverse Effect.

            (m) The Company and its Subsidiary have timely filed all necessary
federal, state and foreign income and franchise tax returns and have paid all
taxes shown thereon as due, and there is no tax deficiency that has been or, to
the best of the Company's knowledge, might be asserted against the Company or
any of its Subsidiaries that has resulted or is reasonably likely to result in a
Material Adverse Effect; and all tax liabilities are adequately provided for on
the books of the Company.

            (n) Except as described in the SEC Documents and subject to the
matters described under "Risk Factors" in the SEC Documents, (i) the Company and
its Subsidiaries have operated and currently operate their businesses in
conformity with all applicable laws, rules and regulations of each jurisdiction
in which they are conducting business, except where the failure to be so in
compliance is not reasonably likely to have a Material Adverse Effect, (ii) the
Company and its Subsidiaries have all licenses, certificates, authorizations,
approvals, permits, franchises, orders and consents from all state, federal and
other governmental or regulatory authorities which are necessary to the current
conduct of their businesses, except where the failure to be so in compliance is
not reasonably likely to have a Material Adverse Effect, (iii) all of such
licenses, certificates, authorizations, approvals, permits, franchises, orders
and consents are valid and in full force and effect, except where the failure to
be valid or in full force and effect is not reasonably likely to have a Material
Adverse Effect, (iv) the Company and its Subsidiaries have fulfilled and
performed, and will fulfill and perform, all of their obligations with respect
to, and are operating in compliance with, all such licenses, certificates,
authorizations, approvals, permits, franchises, orders and consents and no event
has occurred

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which allows, or after notice or lapse of time would allow, revocation or
termination thereof or result in any impairment of the rights of the holder
thereof, except to the extent that any such failure to fulfill or perform such
obligations or to be in compliance with such licenses, certificates,
authorizations, approvals, permits, franchises, orders or consents or any such
revocation, termination or impairment is not reasonably likely to have a
Material Adverse Effect and (v) no such licenses, certificates, authorizations,
approvals, permits, franchises, orders or consents contain any restrictions that
is not reasonably likely to have a Material Adverse Effect.

            (o) The Company has been advised concerning the Investment Company
Act of 1940, as amended (the "1940 ACT"), and the rules and regulations
thereunder. The Company is not, and will not be as a result of consummation of
the Offering, an "investment company" under the 1940 Act.

            (p) The Company and each of its Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general or
specific authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.

            (q) There are no outstanding loans, advances (except normal advances
for business expenses in the ordinary course of business) or guarantees of
indebtedness by the Company to or for the benefit of any of the officers or
directors of the Company or any of the members of the families of any of them,
except as disclosed in the SEC Documents.

      4. FURTHER AGREEMENTS OF THE COMPANY.

      The Company agrees with the Placement Agent that:

            (a) The Company will use its reasonable commercial efforts, and
cooperate with the Placement Agent, to ensure that the offer and sale of the
Shares complies with the securities or Blue Sky laws of such states as the
Placement Agent may designate for offerings to "accredited investors" as defined
in the Securities Act, except that the Company shall not be required in
connection therewith or as a condition thereof to qualify as a foreign
corporation or to execute a general consent to service of process in any
jurisdiction in which it is not otherwise required to be so qualified or to so
execute a general consent to service of process.

            (b) The Company will furnish to the Placement Agent, as soon as
available, copies of the SEC Documents in such quantities as the Placement Agent
may from time to time reasonably request for purposes of distribution to
prospective Investors in the Offering.

            (c) The Company will comply in all material respects with its
obligations pursuant to the Purchase Agreements with the Investors.

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            (d) The Company shall use its reasonable commercial efforts to do
and perform all material things required or necessary to be done and performed
under the Agreements by the Company prior to each Closing Date and to satisfy
all material conditions precedent to the delivery of the Shares.

            (e) The Company will use its reasonable commercial efforts not to
take any action in connection with the Offering which would cause the Company
not to comply with Section 4(2) of the Securities Act. The Company shall
exercise reasonable care to assure that the Investors are not underwriters
within the meaning of Section 2(11) of the Act, and shall take all actions
required by Rule 502(d) of Regulation D. The Company, in its sole discretion,
will not accept a subscription from an Investor if the Company has reason to
believe that material information supplied by or material representations or
warranties made by, such Investor are not fully accurate. The Company shall
reasonably believe, immediately prior to making any sale, that each Investor is
an accredited investor.

            (f) Except as may be required by law, neither the Company nor the
Placement Agent shall distribute materials related to the Offering or otherwise
advertise to or solicit purchasers of Shares without the consent of the other
party. Notwithstanding the foregoing, the Placement Agent may solicit purchasers
of Shares and distribute materials related to the Offering within the scope of
its engagement as Placement Agent.

      5. REPRESENTATIONS OF THE PLACEMENT AGENT.

            (a) The Placement Agent is a member in good standing of the National
Association of Securities Dealers, Inc. ("NASD") and it has, and at all times
while taking any actions constituting an offer or sale of the Shares had, all
governmental licenses (including both federal and state broker dealer licenses)
required to act as placement agent for the shares.

            (b) The Placement Agent has complied and will comply with all
applicable Federal and state laws (including, without limitation, Regulation D)
and applicable rules of the NASD in connection with its activities as placement
agent for the Shares.

      6. CONDITIONS TO PLACEMENT AGENT'S OBLIGATIONS. The obligations of the
Placement Agent hereunder shall be subject to the accuracy, in all material
respects, as of the date hereof, of the representations and warranties of the
Company herein, and to the performance, in all material respects, by the Company
of its obligations hereunder.

      7. EXPENSES. Except as set forth in Section 10, the Company shall be
responsible for, and shall bear all of its expenses incurred in connection with
the proposed Offering, including, without limitation, legal fees of its counsel
relating to the costs of preparing the Offering and the review, negotiation and
execution of the Agreements (but the Company shall not bear any legal fees or
expenses of the Placement Agent), preparing and delivering all selling
documents, including, but not limited to, this Agreement and Blue Sky fees and
filing fees.

      8. INDEMNIFICATION. The Company agrees to indemnify the Placement Agent
and its controlling persons, representatives and agents in accordance with the
indemnification provisions

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set forth in APPENDIX I, and agrees to the other provisions of APPENDIX I, which
is incorporated herein by this reference, regardless of whether the proposed
Offering is consummated.

      9. SURVIVAL OF CERTAIN PROVISIONS. All representations, warranties,
covenants and agreements of the Company and the Placement Agent herein or in
certificates delivered pursuant hereto, and the indemnity agreement contained in
Section 8 and APPENDIX I hereto, shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of the Placement
Agent or any controlling person within the meaning of the Securities Act or the
Exchange Act, or by or on behalf of the Company or any of its officers,
directors or controlling persons within the meaning of the Securities Act or the
Exchange Act, and shall survive the delivery of the Shares to the Investors or
termination of this Agreement.

      10. NOTICES. All notices or communications hereunder will be in writing
and will be mailed, delivered, telegraphed (and confirmed by letter) or
telecopied (and confirmed by letter), as follows: If to the Company, to New
Century Financial Corporation, 18400 Von Karman, Suite 1000, Irvine, California
92612, Attention: Robert Cole, facsimile number (949) 224-5762, with a copy to
O'Melveny & Myers LLP, 990 Marsh Road, Menlo Park, California 94025, facsimile
number 650-473-2601, Attention: David A. Krinsky, Esq.; if to the Placement
Agent, to Friedman, Billings, Ramsey & Co., Inc., 1001 Nineteenth Street North,
Arlington, Virginia 22209, Attention: William Ginivan, Esq. facsimile number
(703) 312-9602, with a copy to Morrison & Foerster LLP, 555 West Fifth Street,
Los Angeles, California 90013, facsimile number 213-892-5454, Attention: Allen
Z. Sussman, Esq.

      11. PARTIES. This Agreement shall inure solely to the benefit of, and
shall be binding upon, the Placement Agent, the Company, and their respective
executors, administrators and successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person or corporation
(including, without limitation, the Investors), other than these parties hereto
and their respective executors, administrators and successors, and the parties
subject to indemnification under Section 8 hereof, any legal or equitable right,
remedy or claim in respect of this Agreement or any provisions herein contained,
this Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of the parties hereto and their
respective executors, administrators and successors and said parties subject to
indemnification, and for the benefit of no other person or corporation. An
Investor in the Offering shall not be deemed to be a successor to the Company.

      12. ENTIRE AGREEMENT. This Agreement embodies the entire agreement among
the parties hereto with respect to the subject matter hereof and supersede all
prior agreements and undertakings, both written and oral, among the parties, or
any of them, with respect to the subject matter hereof.

      13. GOVERNING LAW; CONSENT TO JURISDICTION. This Agreement shall be
governed by, and construed in accordance with, the internal laws of the State of
California without giving effect to the principles of conflicts of law. Any
legal suit, action or proceeding arising out of or based upon this Agreement or
the transactions contemplated hereby ("RELATED PROCEEDINGS") may be instituted
in the federal courts of the United States of America located in the County of
Orange or the courts of the State of California in each case located in the
County of Orange

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(collectively, the "SPECIFIED COURTS"), and each party irrevocably submits to
the exclusive jurisdiction (except for proceedings instituted in regard to the
enforcement of a judgment of any such court (a "RELATED JUDGMENT"), as to which
such jurisdiction is non-exclusive) of such courts in any such suit, action or
proceeding. Service of any process, summons, notice or document by mail to such
party's address set forth above shall be effective service of process for any
suit, action or other proceeding brought in any such court. The parties
irrevocably and unconditionally waive any objection to the laying of venue of
any suit, action or other proceeding in the Specified Courts and irrevocably and
unconditionally waive and agree not to plead or claim in any such court that any
such suit, action or other proceeding brought in any such court has been brought
in an inconvenient forum. With respect to any Related Proceeding, each party
irrevocably waives, to the fullest extent permitted by applicable law, all
immunity (whether on the basis of sovereignty or otherwise) from jurisdiction,
service of process, attachment (both before and after judgment) and execution to
which it might otherwise be entitled in the Specified Courts or any other court
of competent jurisdiction.

      14. COUNTERPARTS. This Agreement may be signed in several counterparts,
each of which will constitute an original.

      15. SEVERABILITY. If any term or provision of this Agreement is invalid,
illegal or incapable of being enforced by any rule of law, or public policy, all
other provisions of this Agreement shall nevertheless remain in full force and
effect so long as the economic and legal substance of the agreements contained
herein is not effected in any manner adverse to any party.

      16. AMENDMENT. The Agreement may not be amended except in writing signed
by each party to be bound thereby.

                            [Signature page follows]

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      If the foregoing correctly sets forth the understanding between the
Company and the Placement Agent, please so indicate in the space provided below
for that purpose, whereupon this Agreement shall constitute a binding agreement
between the Company and the Placement Agent.

                                      Very truly yours,

                                      NEW CENTURY FINANCIAL CORPORATION

                                      By:    /s/ Robert K. Cole
                                         ---------------------------------------
                                      Print Name: ROBERT K. COLE
                                                 -------------------------------
                                      Title:        CEO
                                            ------------------------------------
                                                    Robert K. Love

Accepted as of the date first above written:

FRIEDMAN, BILLINGS, RAMSEY & CO., INC.

By:  /s/ J. Rock Tonbel Jr
   -----------------------------------------
Print Name: J. ROCK TONBEL Jr
           ---------------------------------
Title:  Senior Managing Director
      --------------------------------------

                   J. Rock Tonbel Jr.

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                                   APPENDIX I

                           INDEMNIFICATION PROVISIONS

      The Company agrees to indemnify and hold harmless the Placement Agent and
its affiliates (as defined in Rule 405 under the Securities Act of 1933, as
amended) and their respective directors, officers, employees, agents and
controlling persons (the Placement Agent and each such person being an
"INDEMNIFIED PARTY") from and against any loss, claim, damage or liability (or
action, including stockholder action, in respect thereof), joint or several, to
which such Indemnified Party may become subject under any federal or state law,
or otherwise, which arises out of or is based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in any of the SEC
Documents, including the financial statements and other documents filed as a
part thereof, as amended at the time of this Agreement, or the omission or
alleged omission to state in any of them a material fact required to be stated
therein or necessary to make the statements in any of them, in light of the
circumstances under which they were made, not misleading, (ii) any inaccuracy in
any of the representations and warranties of the Company contained in this
Agreement or (iii) any failure of the Company to perform its obligations under
this Agreement, and will promptly reimburse any Indemnified Party for all
reasonable expenses (including reasonable counsel fees and expenses) as they are
incurred in connection with the investigation of, preparation for or defense
arising from any threatened or pending claim, whether or not such Indemnified
Party is a party and whether or not such claim, action or proceeding is
initiated or brought by the Company. The Company will not be liable to any
Indemnified Party under the foregoing indemnification and reimbursement
provisions, (i) for any settlement by an Indemnified Party effected without its
prior written consent (not to be unreasonably withheld); or (ii) to the extent
that any loss, claim, damage or liability is found in a final judgment by a
court of competent jurisdiction to have resulted primarily from the Placement
Agent's willful misconduct or gross negligence or a breach or violation of any
representation, warranty or covenant of the Placement Agent made in this
Placement Agency Agreement. The Company also agrees that no Indemnified Party
shall have any liability (whether direct or indirect, in contract or tort or
otherwise) to the Company or its security holders or creditors related to or
arising out of the engagement of the Placement Agent pursuant to, or the
performance by the Placement Agent of the services contemplated by, this
Agreement except to the extent that any loss, claim, damage or liability is
found in a final judgment by a court of competent jurisdiction to have resulted
primarily from the Placement Agent's willful misconduct or gross negligence.

      Promptly after receipt by an Indemnified Party of notice of any intention
or threat to commence an action, suit or proceeding or notice of the
commencement of any action, suit or proceeding, such Indemnified Party will, if
a claim in respect thereof is to be made against the Company pursuant hereto,
promptly notify the Company in writing of the same. In case any such action is
brought against any Indemnified Party and such Indemnified Party notifies the
Company of the commencement thereof, the Company may elect to assume the defense
thereof, with counsel reasonably satisfactory to such Indemnified Party, and an
Indemnified Party may employ counsel to participate in the defense of any such
action provided, that the employment of such counsel shall be at the Indemnified
Party's own expense, unless (i) the employment of such counsel has been
authorized in writing by the Company, (ii) the Indemnified Party has reasonably
concluded (based upon advice of counsel to the Indemnified Party) that there may
be legal defenses available to it or other Indemnified Parties that are
different from or in addition to those available to the Company, or that a
conflict or potential conflict exists (based upon advice of counsel to the
Indemnified Party) between the Indemnified Party and the Company that makes it
impossible or inadvisable for counsel to the Indemnifying Party to conduct the
defense of both the Company and the Indemnified Party (in which case the Company
will not have the right to direct the defense of such action on behalf of the
Indemnified Party), or (iii) the Company has not in fact employed counsel
reasonably satisfactory to the Indemnified Party to assume the defense of such
action within a reasonable time after receiving notice of the action, suit or
proceeding, in each of which cases the

                                   Appendix-1
<PAGE>

reasonable fees, disbursements and other charges of such counsel will be at the
expense of the Company; provided, further, that in no event shall the Company be
required to pay fees and expenses for more than one firm of attorneys
representing Indemnified Parties unless the defense of one Indemnified Party is
unique or separate from that of another Indemnified Party subject to the same
claim or action. Any failure or delay by an Indemnified Party to give the notice
referred to in this paragraph shall not affect such Indemnified Party's right to
be indemnified hereunder, except to the extent that such failure or delay causes
actual harm to the Company, or prejudices its ability to defend such action,
suit or proceeding on behalf of such Indemnified Party.

      If the indemnification provided for in this Agreement is for any reason
held unenforceable by an Indemnified Party, the Company agrees to contribute to
the losses, claims, damages and liabilities for which such indemnification is
held unenforceable (i) in such proportion as is appropriate to reflect the
relative benefits to the Company, on the one hand, and the Placement Agent on
the other hand, of the Offering as contemplated whether or not the Offering is
consummated or, (ii) if (but only if) the allocation provided for in clause (i)
is for any reason unenforceable, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) but also the relative
fault of the Company, on the one hand and the Placement Agent, on the other
hand, as well as any other relevant equitable considerations. The Company agrees
that for the purposes of this paragraph the relative benefits to the Company and
the Placement Agent of the Offering as contemplated shall be deemed to be in the
same proportion that the total value received or contemplated to be received by
the Company or its stockholders, as the case may be, as a result of or in
connection with the Offering bear to the fees paid or to be paid to the
Placement Agent under this Agreement. Notwithstanding the foregoing, the Company
expressly agrees that the Placement Agent shall not be required to contribute
any amount in excess of the amount by which fees paid the Placement Agent
hereunder (excluding reimbursable expenses), exceeds the amount of any damages
which the Placement Agent has otherwise been required to pay.

      The Company agrees that without the Placement Agent's prior written
consent, which shall not be unreasonably withheld, it will not settle,
compromise or consent to the entry of any judgment in any pending or threatened
claim, action or proceeding in respect of which indemnification could be sought
under the indemnification provisions of this Agreement (in which the Placement
Agent or any other Indemnified Party is an actual or potential party to such
claim, action or proceeding), unless such settlement, compromise or consent
includes an unconditional release of each Indemnified Party from all liability
arising out of such claim, action or proceeding.

      In the event that an Indemnified Party is requested or required to appear
as a witness in any action brought by or on behalf of or against the Company in
which such Indemnified Party is not named as a defendant, the Company agrees to
promptly reimburse the Placement Agent on a monthly basis for all expenses
incurred by it in connection with such Indemnified Party's appearing and
preparing to appear as such a witness, including, without limitation, the
reasonable fees and disbursements of its legal counsel. In addition to any
reimbursed fees, expenses or costs outlined hereunder, the Placement Agent shall
also receive from the Company cash compensation of $2,000.00 per person, per
day, plus reasonable out-of-pocket expenses and costs should the Placement Agent
be required to provide testimony in any formal or informal proceeding regarding
the Company.

                                   Appendix-2
<PAGE>

      If multiple claims are brought with respect to at least one of which
indemnification is permitted under applicable law and provided for under this
Agreement, the Company agrees that any judgment or arbitration award shall be
conclusively deemed to be based on claims as to which indemnification is
permitted and provided for, except to the extent the judgment or arbitration
award expressly states that it, or any portion thereof, is based solely on a
claim as to which indemnification is not available.

Confirmed and Agreed to:

By: ___________________________________________________
      Robert K. Cole
      Chairman of the Board and Chief Executive Officer

                                   Appendix-3<PAGE>

                                                               EXECUTION VERSION

================================================================================

                           MASTER REPURCHASE AGREEMENT

                                      AMONG

                       CDC MORTGAGE CAPITAL INC., AS BUYER

                   NEW CENTURY MORTGAGE CORPORATION, AS SELLER

                                       AND

                        NC CAPITAL CORPORATION, AS SELLER

                            Dated as of July 19, 2001

================================================================================

<PAGE>

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

1.  APPLICABILITY..............................................................1

2.  DEFINITIONS................................................................1

3.  INITIATION; TERMINATION...................................................19

4.  MARGIN AMOUNT MAINTENANCE.................................................28

5.  INCOME PAYMENTS...........................................................29

6.  REQUIREMENTS OF LAW.......................................................29

7.  SECURITY INTEREST.........................................................31

8.  PAYMENT, TRANSFER AND CUSTODY.............................................32

9.  HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS...............................33

10. SELLER'S REPRESENTATIONS..................................................33

11. COVENANTS OF SELLER.......................................................38

12. EVENTS OF DEFAULT.........................................................49

13. REMEDIES..................................................................51

14. INDEMNIFICATION AND EXPENSES..............................................53

15. RECORDING OF COMMUNICATIONS...............................................54

16. SINGLE AGREEMENT..........................................................55

17. NOTICES AND OTHER COMMUNICATIONS..........................................55

18. ENTIRE AGREEMENT; SEVERABILITY............................................55

19. NON-ASSIGNABILITY.........................................................56

20. TERMINABILITY.............................................................56

21. GOVERNING LAW.............................................................56

22. SUBMISSION TO JURISDICTION; WAIVERS.......................................56

                                      -i-
<PAGE>

23. NO WAIVERS, ETC...........................................................57

24. SERVICING.................................................................57

25. BUYER'S REPRESENTATIONS...................................................59

26. NETTING...................................................................59

27. PERIODIC DUE DILIGENCE REVIEW.............................................60

28. BUYER'S APPOINTMENT AS ATTORNEY-IN-FACT...................................61

29. MISCELLANEOUS.............................................................62

30. CONFIDENTIALITY...........................................................63

31. CONFLICTS.................................................................63

32. SET-OFF...................................................................63

33. OBLIGATIONS JOINT AND SEVERAL.............................................63

                                      -ii-
<PAGE>

EXHIBITS

SCHEDULE 1              Representations and Warranties Re: Mortgage Loans

SCHEDULE 2              Subsidiaries

SCHEDULE 3              Litigation

EXHIBIT I               Transaction Request

EXHIBIT II              Underwriting Guidelines

EXHIBIT III             Form of Opinion Letter

EXHIBIT IV              UCC Filing Jurisdictions

EXHIBIT V               Form of Account Agreement

EXHIBIT VI              Form of True Sale Certification

EXHIBIT VII-A           Form of Seller's Release Letter

EXHIBIT VII-B           Form of Warehouse Lender's Release Letter

EXHIBIT VIII            Form of Servicer Notice

EXHIBIT IX              Form of Request for Additional Transactions for
                        Excess Margin

                                     -iii-
<PAGE>

                           MASTER REPURCHASE AGREEMENT

            This is a MASTER REPURCHASE AGREEMENT, dated as of July 19, 2001,
among NEW CENTURY MORTGAGE CORPORATION, a California corporation ("NCMC"), NC
CAPITAL CORPORATION, a California corporation ("NCCC", and together with NCMC,
"SELLER") and CDC MORTGAGE CAPITAL INC., a New York corporation ("BUYER").

1.    APPLICABILITY

      From time to time the parties hereto may enter into transactions in which
      Seller agrees to transfer to Buyer Mortgage Loans against the transfer of
      funds by Buyer, with a simultaneous agreement by Buyer to transfer to
      Seller such Mortgage Loans at a date certain not later than 364 days after
      the date of transfer, against the transfer of funds by Seller. Each such
      transaction shall be referred to herein as a "TRANSACTION" and shall be
      governed by this Agreement, unless otherwise agreed in writing.

2.    DEFINITIONS

      As used herein, the following terms shall have the following meanings (all
      terms defined in this Section 2 or in other provisions of this Agreement
      in the singular to have the same meanings when used in the plural and VICE
      VERSA). Terms otherwise not defined herein shall have the meanings set
      forth in the Custodial Agreement.

      "ACCOUNT AGREEMENT" shall mean a letter agreement among NCCC, NCMC,
      Servicer, Buyer and the Bank substantially in the form of EXHIBIT V
      attached hereto.

      "ACT OF INSOLVENCY" shall mean, with respect to any Person, (i) the filing
      of a petition, commencing, or authorizing the commencement of any case or
      proceeding under any bankruptcy, insolvency, reorganization, liquidation,
      dissolution or similar law relating to the protection of creditors, or
      suffering any such petition or proceeding to be commenced by another which
      is consented to, not timely contested or results in entry of an order for
      relief which is not discharged within thirty (30) days; (ii) the seeking
      or consenting to the appointment of a receiver, trustee, custodian or
      similar official for such Person or any substantial part of the property
      of such Person; (iii) the appointment of a receiver, conservator, or
      manager for such Person by any governmental agency or authority having the
      jurisdiction to do so; (iv) the making or offering by such Person of a
      composition with its creditors or a general assignment for the benefit of
      creditors; (v) the admission by such Person of its inability to pay its
      debts or discharge its obligations as they become due or mature; or (vi)
      that any governmental authority or agency or any person, agency or entity
      acting or purporting to act under governmental authority shall have taken
      any action to condemn, seize or appropriate, or to assume custody or
      control of, all or any substantial part of the property of such Person, or
      shall have taken any action to displace the management of such Person or
      to curtail its authority in the conduct of the business of such Person.

      "ADDITIONAL PURCHASED ASSETS" shall mean Mortgage Loans or cash provided
      by Seller to Buyer or its designee pursuant to Section 4.

<PAGE>

      "ADJUSTED LEVERAGE RATIO" shall mean on any date of determination, the
      ratio of (a) Total Liabilities to (b) Adjusted Tangible Net Worth.

      "ADJUSTED TANGIBLE NET WORTH" shall mean on any date of determination, the
      Tangible Net Worth of Guarantor minus 25% of the amount by which the book
      value of Junior Securitization Interests included in calculating Tangible
      Net Worth exceeds Indebtedness of the type described in Section 11(s)(4).

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

      "AGREEMENT" shall mean this Master Repurchase Agreement, as the same may
      be further amended, supplemented or otherwise modified in accordance with
      the terms hereof.

      "ALTA" shall mean the American Land Title Association.

      "APPRAISED VALUE" shall mean the value set forth in an appraisal made in
      connection with the origination of the related Mortgage Loan as the value
      of the Mortgaged Property.

      "ASSET VALUE" shall mean with respect to each Eligible Asset as of any
      date of determination, the lesser of (a) the Purchase Percentage
      multiplied by the Market Value of such Mortgage Loan as of such date of
      determination, and (b) the outstanding principal balance of such Eligible
      Asset as of such date of determination; provided, that, the following
      additional limitations on Asset Value shall apply:

            (1)   the aggregate Asset Value of Wet-Ink Mortgage Loans may not
                  exceed the Wet-Ink Sub-Limit at any time;

            (2)   the aggregate Asset Value of Second Lien Mortgage Loans may
                  not exceed the Second Lien Sub-Limit at any time;

            (3)   the aggregate Asset Value of Second Lien Mortgage Loans with a
                  CLTV in excess of 100% shall not exceed the Second Lien CLTV
                  Sub-Limit at any time;

            (4)   the aggregate Asset Value of a single Mortgage Loan shall not
                  exceed the Mortgage Loan Sub-Limit;

            (5)   the aggregate Asset Value of Jumbo Mortgage Loans may not
                  exceed the Jumbo Sub-Limit at any time;

            (6)   the aggregate Asset Value of Jumbo(500) Mortgage Loans may not
                  exceed the Jumbo(500) Sub-Limit at any time;

            (7)   the aggregate Asset Value of Jumbo(750) Mortgage Loans may not
                  exceed the Jumbo(750) Sub-Limit at any time;

                                      -2-
<PAGE>

            (8)   the aggregate Asset Value of C Credit Mortgage Loans may not
                  exceed the C Credit Sub-Limit at any time;

            (9)   the aggregate Asset Value of C Minus Credit Mortgage Loans may
                  not exceed the C Minus Credit Sub-Limit at any time;

            (10)  The aggregate Asset Value of Non-owner Occupied Mortgage Loans
                  may not exceed $12,500,000;

            (11)  The aggregate Asset Value of High Cost Mortgage Loans may not
                  exceed $5,000,000; and

            (12)  the Asset Value shall be deemed to be zero with respect to
                  each Mortgage Loan (i) in respect of which there is a breach
                  of a representation and warranty set forth in SCHEDULE 1
                  (assuming each representation and warranty is made as of the
                  date Asset Value is determined), (ii) in respect of which
                  there is a delinquency in the payment of principal and/or
                  interest which continues for a period in excess of twenty nine
                  (29) calendar days (without regard to any applicable grace
                  periods), (iii) which has not been repurchased by Seller by
                  the earlier to occur of (A) the Termination Date and (B) the
                  180th day after the date on which it is first purchased by
                  Buyer, (iv) which has been released from the possession of
                  Custodian under the Custodial Agreement to Seller for a period
                  in excess of ten (10) calendar days, (v) which exceed the
                  limitations on Asset Value set forth above or (vi) which is a
                  Wet-Ink Mortgage Loan, for which Custodian has failed to
                  receive the related Mortgage Documents by the seventh (7th)
                  Business Day following the applicable Origination Date of such
                  Wet-Ink Mortgage Loan.

      "ASSIGNMENT OF MORTGAGE" shall mean, with respect to any Mortgage, an
      assignment of the Mortgage, notice of transfer or equivalent instrument in
      recordable form, sufficient under the laws of the jurisdiction wherein the
      related Mortgaged Property is located to reflect the assignment of the
      Mortgage to Buyer.

      "BANK" shall mean U.S. Bank National Association, a national banking
      association, and its successors in interest, or such other depository
      institution as may be acceptable to Buyer in its sole discretion, and
      their respective successors in interest.

      "BANKRUPTCY CODE" shall mean the United States Bankruptcy Code of 1978, as
      amended from time to time.

      "BASIC STATUS REPORT AND EXCEPTION REPORT" shall have the meaning assigned
      thereto in the Custodial Agreement.

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

                                      -3-
<PAGE>

      "BUYER" shall mean CDC Mortgage Capital Inc., a New York corporation, and
      its successors in interest and assigns.

      "C CREDIT MORTGAGE LOAN" shall mean each Mortgage Loan originated in
      accordance with the Underwriting Guidelines criteria for "C" credit
      mortgage loans.

      "C CREDIT SUB-LIMIT" shall mean an amount equal to $30,000,000.

      "C MINUS CREDIT MORTGAGE LOANS" shall mean each Mortgage Loan originated
      in accordance with the Underwriting Guidelines criteria for "C-" credit
      mortgage loans.

      "C MINUS CREDIT SUB-LIMIT" shall mean an amount equal to $20,000,000.

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

      "CODE" shall mean the Internal Revenue Code of 1986, as amended from time
      to time.

      "COLLECTION ACCOUNT" shall mean the account established by the Bank
      subject to an Account Agreement, into which all Income shall be deposited.

      "COMBINED LOAN-TO-VALUE RATIO OR CLTV" shall mean with respect to any
      Second Lien Mortgage Loan, the sum of the original principal balance of
      such Mortgage Loan and the outstanding principal balance of any related
      first lien as of the date of origination of the Mortgage Loan, divided by
      the lesser of the Appraised Value of the Mortgage Property as of the
      Origination Date or the purchase price of the Mortgaged Property.

      "COMMONLY CONTROLLED ENTITY" shall mean an entity, whether or not
      incorporated, which is under common control with Seller within the meaning
      of Section 4001 of ERISA or is part of a group which includes Seller and
      which is treated as a single employer under Section 414 of the Code.

      "COMPANY SECURITIZATION TRANSACTION" shall mean an issuance of
      Mortgage-backed Securities by NCCC, NCMC, or by SBRC, or any other
      registered broker dealer, or an Affiliate of any of them, on behalf of
      NCCC or NCMC, through a trust or other entity created by NCCC or NCMC,
      SBRC or any other registered broker-dealer which Mortgage-backed
      Securities are either secured (in whole or in part) by Mortgage Loans
      originated or acquired by NCCC or NCMC or evidence the entire beneficial
      ownership interest therein, and in connection with which one or more
      Junior Securitization Interests are issued to NCCC or NCMC or any
      Affiliate.

      "CHANGE OF CONTROL" shall mean the occurrence, after the Effective Date,
      of any of the following circumstances: (a) Guarantor not owning, directly
      or indirectly, all of the issued and outstanding capital stock of NCMC; or
      (b) any Person, or two or more Persons

                                      -4-
<PAGE>

      acting in concert, other than the Management Shareholders, acquiring
      beneficial ownership (within the meaning of Rule 13d-3 of the Securities
      and Exchange Commission under the Securities Exchange Act of 1934, as
      amended), directly or indirectly, of securities of Guarantor (or other
      securities convertible into such securities) representing 35% or more of
      the combined voting power of all securities of Guarantor entitled to vote
      in the election of directors; (c) any Person, or two or more Persons
      acting in concert, other than the Management Shareholders, acquiring by
      contract or otherwise, or entering into a contract or arrangement which
      upon consummation will result in its or their acquisition of and, control
      over securities of Guarantor (or other securities convertible into such
      securities) representing 35% or more of the combined voting power of all
      securities of Guarantor entitled to vote in the election of directors; (d)
      Robert Cole ceasing to be Chairman and Chief Executive Officer of
      Guarantor or (e) U.S. Bancorp's direct or indirect equity interest in
      Guarantor is reduced below 17.5%.

      "CONFIRMATION" shall have the meaning specified in Section 3(c).

      "COUNTRYWIDE FINANCING FACILITY" shall mean the Master Repurchase
      Agreement, dated as of July 28, 2000, and Annex I thereto, as may be
      amended from time to time, among between Countrywide Warehouse Lending and
      NC Residual Corporation II, and all other documents or agreements executed
      in connection therewith, or replacement facilities with substantially
      similar terms (including, but not limited to, amounts and rates) with
      financial institutions approved by Buyer.

      "CUSTODIAL AGREEMENT" shall mean that custodial agreement, dated as of
      July 19, 2001 by and among Buyer, NCCC, NCMC and Custodian, as the same
      shall be modified and supplemented and in effect from time to time.

      "CUSTODIAL IDENTIFICATION CERTIFICATE" shall have the meaning specified in
      the Custodial Agreement.

      "CUSTODIAN" shall mean U.S. Bank National Association, a national banking
      association, and its successors in interest, as custodian under the
      Custodial Agreement, and any successor Custodian under the Custodial
      Agreement.

      "DAILY LEVERAGE RATIO" shall mean on any date of determination, the ratio
      of (a) Total Liabilities of Guarantor and its Subsidiaries on such date to
      (b) Tangible Net Worth of Guarantor and its Subsidiaries as of the last
      day of the most recently completed month.

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

      "DOLLARS" and "$" shall mean lawful money of the United States of America.

      "DUE DILIGENCE REVIEW" shall mean the performance by Buyer of any or all
      of the reviews permitted under Section 27 with respect to any or all of
      the Mortgage Loans, as desired by Buyer from time to time.

                                      -5-
<PAGE>

      "EARLY TERMINATION PERCENTAGE" shall mean 25 basis points (0.25%) less
      0.02 basis points (0.02%) for each full calendar month that has elapsed
      since the Effective Date.

      "EFFECTIVE DATE" shall mean the date upon which the conditions precedent
      set forth in Section 3(a)(1) shall have been satisfied.

      "ELECTRONIC TRANSMISSION" shall mean the delivery of information in an
      electronic format acceptable to the applicable recipient thereof.

      "ELIGIBLE ASSET" shall mean a Mortgage Loan, including a Wet-Ink Mortgage
      Loan, (i) as to which the representations and warranties in SCHEDULE 1
      attached hereto are true and correct, (ii) which is underwritten strictly
      in accordance with the Underwriting Guidelines of Seller, and (iii) which
      is secured by a Residential Dwelling.

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

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

      "EURODOLLAR RATE" shall mean, with respect to each day a Transaction is
      outstanding, the rate per annum equal to the rate appearing at page 5 of
      the Telerate Screen as one-month LIBOR at or about 9:00 a.m., New York
      time, on such date (and if such date is not a Business Day, the Eurodollar
      Rate in effect on the Business Day immediately preceding such date), and
      if such rate shall not be so quoted, the average rate per annum at which
      three mutually acceptable banks are offered Dollar deposits at or about
      9:00 a.m., New York time, on such date by prime banks in the interbank
      eurodollar market where the eurodollar and foreign currency exchange
      operations in respect of its Transactions are then being conducted for
      delivery on such day for a period of thirty (30) days and in an amount
      comparable to the amount of the Transactions to be outstanding on such
      day. The Eurodollar Rate shall be reset by Buyer as described above and
      Buyer's determination of Eurodollar Rate shall be conclusive upon the
      parties absent manifest error on the part of Buyer

      "EVENT OF DEFAULT" has the meaning specified in Section 12.

      "EXCESS MARGIN" has the meaning specified in Section 3(r).

      "EXISTING FINANCING FACILITIES" shall mean the Countrywide Financing
      Facility, the Greenwich Financing Facility, the Morgan Stanley Financing
      Facility, the Salomon Financing Facility, the Salomon NCMC Financing
      Facility, the Salomon REO Financing Facility, the Salomon Residual
      Financing Facility, the US Bank Financing Facility, the UBS Financing
      Facility and the USB Financing Facility.

                                      -6-
<PAGE>

      "FANNIE MAE" shall mean the Federal National Mortgage Association, and its
      successors in interest.

      "FORECLOSED LOAN" shall mean a loan the property securing which has been
      foreclosed upon by Seller.

      "FREDDIE MAC" shall mean the Federal Home Loan Mortgage Corporation, and
      its successors in interest.

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

      "GOVERNMENTAL AUTHORITY" shall mean any nation or government, any state or
      other political subdivision thereof, any entity exercising executive,
      legislative, judicial, regulatory or administrative functions of or
      pertaining to government and any court or arbitrator having jurisdiction
      over NCCC, NCMC, Guarantor, any of their respective Subsidiaries or any of
      their properties.

      "GREENWICH FINANCING FACILITY" shall mean the Residual Financing Facility
      Agreement dated as of June 23, 1999, as may be amended from time to time,
      by and between NCCC and Greenwich Capital Financial Products, Inc. and all
      other documents or agreements executed in connection therewith, or
      replacement facilities with substantially similar terms (including, but
      not limited to, amounts and rates) with financial institutions approved by
      Buyer.

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

      "GUARANTOR" shall mean New Century Financial Corporation, a California
      corporation, and its successors in interest.

      "GUARANTY" shall mean the Guaranty, dated as of the date hereof, made by
      Guarantor in favor of Buyer, which shall be in form and substance
      satisfactory to Buyer in all respects.

                                      -7-
<PAGE>

      "INCOME" shall mean, with respect to any Mortgage Loan at any time, all
      collections and proceeds on or in respect of the Mortgage Loans,
      including, without limitation, any principal thereof then payable and all
      interest or other distributions payable thereon less any related servicing
      fee(s) charged by Servicer.

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

      "INITIAL FUNDING" shall mean the date upon which the conditions precedent
      set forth in Section 3(a)(2) shall have been satisfied.

      "INTEREST RATE PROTECTION AGREEMENT" shall mean, with respect to any or
      all of the Mortgage Loans, any short sale of US Treasury securities, or
      futures contract, or options related contract, or interest rate swap, cap
      or collar agreement or similar arrangement providing for protection
      against fluctuations in interest rates or the exchange of nominal interest
      obligations, either generally or under specific contingencies and
      acceptable to Buyer.

      "INVESTMENT" shall mean with respect to any Person, any direct or indirect
      purchase or other acquisition by that Person of, or a beneficial interest
      in, stock or other securities of any other Person, or any direct or
      indirect loan, advance (other than advances to employees for moving and
      travel expenses, drawing accounts and similar expenditures in the ordinary
      course of business) or capital contribution by that Person to any other
      Person, including all Indebtedness and accounts receivable from that other
      Person which are not current assets or did not arise from sales to that
      other Person in the ordinary course of business.

      "JUMBO MORTGAGE LOANS" shall mean each Mortgage Loan with a principal
      balance as of origination of more than $275,000.

                                      -8-
<PAGE>

      "JUMBO SUB-LIMIT" shall mean an amount equal to $70,000,000

      "JUMBO(500) MORTGAGE LOANS" shall mean each Mortgage Loan with a principal
      balance as of origination of more than $500,000 and less than or equal to
      $750,000.

      "JUMBO(500) SUB-LIMIT" shall mean an amount equal to $40,000,000.

      "JUMBO(750) MORTGAGE LOANS" shall mean shall mean each Mortgage Loan with
      a principal balance as of origination of more than $750,000.

      "JUMBO(750) SUB-LIMIT" shall mean an amount equal to $20,000,000.

      "JUNIOR SECURITIZATION INTERESTS" shall mean a Mortgage-backed Security
      created in a Company Securitization Transaction that represents a
      subordinated right to receive principal or interest payments on the
      underlying Mortgage Loans (whether or not such subordination arises only
      under particular circumstances).

      "LATE PAYMENT FEE" has the meaning specified in Section 5(b).

      "LEVERAGE RATIO" shall mean on any date of determination, the ratio of (a)
      Total Liabilities to (b) Tangible Net Worth.

      "LIEN" shall mean any mortgage, lien, pledge, charge, security interest or
      similar encumbrance.

      "LOAN-TO-VALUE RATIO" or "LTV" means with respect to any Mortgage Loan,
      the ratio of the original outstanding principal amount of the Mortgage
      Loan to the lesser of (a) the Appraised Value of the Mortgaged Property at
      origination of each Mortgage Loan and (b) if the Mortgaged Property was
      purchased within twelve (12) months of the origination of the Mortgage
      Loan, the purchase price of the Mortgaged Property.

      "MANAGEMENT SHAREHOLDERS" shall mean Robert K. Cole, Brad A. Morrice, and
      Edward F. Gotschall.

      "MARGIN BASE" shall mean the aggregate Asset Value of all Purchased Assets
      which are Eligible Assets.

      "MARGIN DEFICIT" has the meaning specified in Section 4.

      "MARKET VALUE" shall mean, as of any date in respect of any Mortgage Loan,
      the price at which such Mortgage Loan could readily be sold as determined
      in Buyer's sole discretion using its reasonable business judgment, which
      price may be determined to be zero. Buyer's determination of Market Value
      shall be conclusive upon the parties absent manifest error on the part of
      Buyer.

      "MATERIAL ADVERSE EFFECT" shall mean a material adverse effect on (a) the
      Property, business, operations, financial condition or prospects of NCCC,
      NCMC or Guarantor, (b) the ability of NCCC or NCMC to perform its
      obligations under any of the Repurchase

                                      -9-
<PAGE>

      Documents to which it is a party, (c) the validity or enforceability of
      any of the Repurchase Documents, (d) the rights and remedies of Buyer
      under any of the Repurchase Documents, (e) the timely payment of any
      amounts payable under the Repurchase Documents, (f) the Asset Value of the
      Purchased Assets or (g) the ability of Guarantor to perform its
      obligations under the Guaranty.

      "MAXIMUM AMOUNT" shall mean $200,000,000.

      "MORGAN STANLEY FINANCING FACILITY" shall mean the Master Loan and
      Security Agreement dated December 1, 2000, as may be amended from time to
      time, between NCCC and Morgan Stanley Dean Witter Mortgage Capital, Inc.
      and all other documents or agreements executed in connection therewith, or
      replacement facilities with substantially similar terms (including, but
      not limited to, amounts and rates) with financial institutions approved by
      Buyer.

      "MORTGAGE" shall mean the mortgage, deed of trust or other instrument
      securing a Mortgage Note, which creates a first lien or second lien on a
      fee simple Residential Dwelling securing the Mortgage Note.

      "MORTGAGE FILE" shall have the meaning assigned thereto in the Custodial
      Agreement.

      "MORTGAGE LOAN" shall mean a mortgage loan originated in accordance with
      the Underwriting Guidelines which Custodian has been instructed to hold
      for Buyer pursuant to the Custodial Agreement, and which Mortgage Loan
      includes, without limitation, (i) a Mortgage Note and related Mortgage,
      and (ii) all right, title and interest of Seller in and to the Mortgaged
      Property covered by such Mortgage.

      "MORTGAGE LOAN SUB-LIMIT" shall mean $1,000,000.

      "MORTGAGE NOTE" shall mean the original executed promissory note or other
      evidence of the indebtedness of a Mortgagor with respect to a Mortgage
      Loan.

      "MORTGAGE-BACKED SECURITY" shall mean a security (including, without
      limitation, a participation certificate) that is an interest in a pool of
      Mortgage Loans or is secured by such an interest.

      "MORTGAGED PROPERTY" shall mean a fee simple interest in the real property
      (including all improvements, buildings, fixtures, building equipment and
      personal property thereon and all additions, alterations and replacements
      made at any time with respect to the foregoing) and all other collateral
      securing repayment of the debt evidenced by a Mortgage Note.

      "MORTGAGEE" shall mean the record holder of a Mortgage Note secured by a
      Mortgage.

      "MORTGAGOR" shall mean the obligor or obligors on a Mortgage Note,
      including any person who has assumed or guaranteed the obligations of the
      obligor thereunder.

                                      -10-
<PAGE>

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

      "NCCC" shall mean NC Capital Corporation, a California corporation, and
      its successors in interest.

      "NCMC" shall mean New Century Mortgage Corporation, a California
      corporation, and its successors in interest.

      "NCRC" shall mean NC Residual II Corporation, a Delaware corporation, and
      its successors in interest.

      "NET WORTH" shall mean with respect to any Person, on any date of
      determination, the net worth of such Person as of such date, determined in
      accordance with GAAP.

      "NON-OWNER OCCUPIED MORTGAGE LOANS" shall mean each Mortgage Loan with
      respect to which the improvements on the Mortgaged Property are not
      occupied by the owner of such Mortgaged Property.

      "NON-USE FEE" has the meaning specified in Section 3(p).

      "ORIGINATION DATE" shall mean the date a Mortgage Loan is funded by any
      originator and the proceeds are disbursed to a borrower under such
      Mortgage Loan.

      "PAYMENT DATE" shall mean the tenth (10th) Business Day of each month.

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

      "PERIODIC ADVANCE REPURCHASE PAYMENT" has the meaning specified in Section
      5(b).

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

      "PLAN" shall mean an employee benefit or other plan established or
      maintained by any Seller or any ERISA Affiliate and covered by Title IV of
      ERISA.

      "POST-DEFAULT RATE" shall mean, in respect of any day a Transaction is
      outstanding or any other amount under this Agreement or any other
      Repurchase Document that is not paid when due to Buyer at the stated
      Repurchase Date or otherwise when due (a "POST-DEFAULT DAY"), a rate per
      annum on a 360 day per year basis during the period from and including the
      due date to but excluding the date on which such amount is paid in full
      equal to 4% per annum PLUS the Prime Rate on such Post-Default Day.

      "PRICE DIFFERENTIAL" means, with respect to any Transaction hereunder as
      of any date, the aggregate amount obtained by daily application of the
      Pricing Rate for such Transaction

                                      -11-
<PAGE>

      to the Purchase Price for such Transaction on a 360 day per year basis for
      the actual number of days during the period commencing on (and including)
      the Purchase Date for such Transaction and ending on (but excluding) the
      Repurchase Date (reduced by any amount of such Price Differential
      previously paid by Seller to Buyer with respect to such Transaction).

      "PRICING RATE" shall mean a rate per annum equal to the sum of (a) the
      Eurodollar Rate plus (b) the Pricing Spread.

      "PRICING SPREAD" shall mean the applicable rates per annum set forth below
      for each type of Eligible Asset for each day during the related Interest
      Period:

            (b)   Mortgage Loans (other than Wet-Ink Mortgage Loans), 0.95% (95)
                  basis points; and

            (c)   Wet-Ink Mortgage Loans, 1.25% (125) basis points.

      "PRIME RATE" shall mean the prime rate announced to be in effect from time
      to time, as published as the average rate in THE WALL STREET JOURNAL.

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

      "PURCHASE AGREEMENT" shall mean any purchase agreement by and between NCCC
      or NCMC and any third party, including without limitation, any Affiliate
      of NCCC or NCMC, pursuant to which NCCC or NCMC has purchased assets
      subsequently sold to Buyer hereunder.

      "PURCHASE DATE" shall mean the date on which Purchased Assets are
      transferred by Seller to Buyer or its designee (including Custodian).

      "PURCHASE PERCENTAGE" shall mean the applicable percentage set forth below
      for each type of Eligible Assets:

            (a)   Mortgage Loans (other than Wet-Ink Mortgage Loans), 98%; and

            (b)   Wet-Ink Mortgage Loans, 98%.

      "PURCHASE PRICE" shall mean on each Purchase Date, the price at which
      Purchased Assets are transferred by Seller to Buyer or its designee
      (including Custodian) which shall equal the Asset Value for such Purchased
      Assets on the Purchase Date.

      "PURCHASED ASSETS" shall mean the Mortgage Loans sold by Seller to Buyer
      in a Transaction, and any Additional Purchased Assets.

      "PURCHASED ITEMS" has the meaning specified in Section 7.

                                      -12-
<PAGE>

      "QUALIFIED ORIGINATOR" means NCMC, any of its subsidiaries set forth on
      Schedule 2, or any other originator of Mortgage Loans acceptable to Buyer
      in its sole discretion.

      "QUARTERLY AVERAGE LEVERAGE RATIO" shall mean for each three (3) month
      period ending on March 31, June 30, September 30 or December 31 of any
      year during the term of this Agreement, the ratio of (a) the average daily
      amount of Total Liabilities of Guarantor and its Subsidiaries outstanding
      during such three (3) month period to (b) the average of the Tangible Net
      Worth of Guarantor and its Subsidiaries at the end of each month during
      such three (3) month period.

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

      "REO PROPERTY" shall mean real property acquired by Seller, including a
      Mortgaged Property acquired through foreclosure of a Mortgage Loan or by
      deed in lieu of such foreclosure.

      "REO SUB" shall mean New Century REO Corp., a California corporation.

      "REPORTABLE EVENT" shall mean any of the events set forth in Section
      4043(b) of ERISA or a successor provision thereof, other than those events
      as to which the thirty day notice period is waived under subsections .13,
      .14, .16, .18, .19 or .20 of PBGC Reg. ss. 2615 or one or more successor
      provision thereof.

      "REPURCHASE DATE" shall mean the date on which Seller is to repurchase the
      Purchased Assets from Buyer as specified in the related Confirmation,
      including any date determined by application of the provisions of Sections
      3 or 13; which date shall be specified as "open" unless otherwise
      requested by Seller and agreed by Buyer; provided that in no event shall
      the Repurchase Date be in excess of 364 days after the Purchase Date.

      "REPURCHASE DOCUMENTS" shall mean this Agreement, the Custodial Agreement,
      the Guaranty, the Account Agreement, the Side Letter, among New Century
      Financial Corporation and CDC Capital Markets, Inc., dated May 17, 2001
      and the Side Letter, among Buyer, NCMC, NCCC and Guarantor, dated July 19,
      2001.

      "REPURCHASE OBLIGATIONS" shall have the meaning provided in Section 7(b).

      "REPURCHASE PRICE" means the price at which Purchased Assets are to be
      transferred from Buyer or its designee (including Custodian) to Seller
      upon termination of a Transaction, which will be determined in each case
      (including Transactions terminable upon demand) as the sum of the Purchase
      Price and the Price Differential as of the date of such determination
      decreased by all cash, Income and Periodic Advance Repurchase Payments
      (including Late Payment Fees, if any) actually received by Buyer pursuant
      to Sections 5(a) or 5(b), respectively.

                                      -13-
<PAGE>

      "REQUIRED AMENDMENTS" shall mean the amendment, in form and substance
      satisfactory to Buyer in its sole discretion, to the USB Financing
      Facility and the Salomon Financing Facility to amend the covenants set
      forth in Sections 4.14, 4.15 and 4.16 and in Annex 1, Sections
      2(i)(v)(A)(B) and (C), respectively, thereof such that such covenants are
      satisfactory to the Buyer in all respects and substantially conform to the
      covenants set forth in Sections 11(m), 11(n) and 11(o), duly executed and
      delivered by the parties to such Existing Financing Facilities.

      "REQUIRED SECONDARY AMENDMENTS" shall mean the amendments, each in form
      and substance satisfactory to Buyer in its sole discretion, to the Morgan
      Stanley Financing Facility to amend the representations and warranties
      with respect to mortgage loans such that such representations and
      warranties are satisfactory to the Buyer in all respects and substantially
      conform to the representations and warranties set forth in clauses 9, 16,
      20 and 41 of Schedule 1 and to delete the representation which requires
      that no mortgage loan has been refinanced by Seller if such original
      mortgage loan was originated by Seller or an Affiliate, duly executed and
      delivered by the parties to the Morgan Stanley Financing Facility.

      "REQUIREMENT OF LAW" shall mean as to any Person, the certificate of
      incorporation and by-laws or other organizational or governing documents
      of such Person, and any law, treaty, rule or regulation or determination
      of an arbitrator or a court or other Governmental Authority, in each case
      applicable to or binding upon such Person or any of its property or to
      which such Person or any of its property is subject.

      "RESIDENTIAL DWELLING" shall mean any one of the following: (i) a detached
      single family dwelling, (ii) a two-to-four family dwelling, (iii) a unit
      in a condominium project, (iv) a detached single family dwelling in a
      planned unit development or (v) manufactured housing units. Mortgaged
      Properties that consist of the following property types are not
      Residential Dwellings: (a) co-operative units, (b) log homes, (c) earthen
      homes, (d) underground homes, (e) mobile homes, and (f) any dwelling
      situated on more than ten acres of property.

      "RESIDUAL FINANCE SUBSIDIARIES" shall mean (a) NC Residual Corporation, a
      Delaware corporation, as long as it is a wholly-owned Subsidiary of NCMC
      and does not amend its Certificate of Incorporation as in effect on March
      20, 1998, and (b) any other wholly-owned Subsidiary of NCMC or NCCC that,
      pursuant to its Articles or Certificate of Incorporation, has a purpose
      limited to the ownership of Junior Securitization Interests, the
      establishment of one or more securitization trusts, issuing securities
      backed by such Junior Securitization Interests, otherwise financing such
      Junior Securitization Interests, and lawful activities incidental to and
      necessary and convenient to the foregoing.

      "RESIDUAL FINANCING AGREEMENTS" shall mean collectively, the Global Master
      Repurchase Agreement dated as of March 29, 2001 by and between Salomon
      Smith Barney, Inc., as Agent for Salomon Brothers International, Inc., and
      NCCC, as amended, supplemented, restated or otherwise modified and in
      effect from time to time, (ii) the Global Master Repurchase Agreement
      dated as of March 29, 2001 by and between Salomon Smith Barney, Inc., as
      Agent for Salomon Brothers International, Inc., and NCRC, as amended,

                                      -14-
<PAGE>

      supplemented, restated or otherwise modified and in effect from time to
      time, (iii) the Master Loan and Security Agreement dated as of July 20,
      1999 by and among Seller, NC Capital Corporation and UBS Real Estate
      Securities Inc. (formerly known as Paine Webber Real Estate Securities
      Inc.), as amended, supplemented, restated or otherwise modified and in
      effect from time to time, (iv) the Residual Financing Facility Agreement
      dated as of June 23, 1999 by and between NCCC and Greenwich Capital
      Financial Products, Inc., as amended, supplemented, restated or otherwise
      modified and in effect from time to time, and (v) any similar agreements
      pursuant to which "Residual Financing" (as defined in the Residual
      Security Agreement) is hereafter provided to NCMC or NCCC or any
      Subsidiary of NCMC or NCCC.

      "RESIDUAL SECURITY AGREEMENT" shall mean the Amended and Restated Security
      Agreement dated as of April 30, 2000 by and among NCCC, NCRC and U.S. Bank
      National Association, as collateral agent for (i) the Lenders (as defined
      therein), (ii) U.S. Bancorp Leasing & Financial, successor in interest to
      FBS Business Finance Corp. (the "Lessor"), as Lessor under any present or
      future leases of equipment by the Lessor, as lessor, to NCCC, NCMC or
      Guarantor, as lessee, or as lender under any present or future loan by the
      Lessor, as lender, to NCCC, NCMC or Guarantor, as borrower, secured by
      equipment and (iii) the Subordinated Noteholder (as defined therein).

      "RESPONSIBLE OFFICER" shall mean, as to any Person, the chief executive
      officer, the chief financial officer, the treasurer or the chief operating
      officer of such Person.

      "RISK RATING" shall mean the risk rating of a Mortgage Loan, as determined
      using the Underwriting Guidelines.

      "SALOMON FINANCING FACILITY" shall mean TBMA/ISMA Global Master Repurchase
      Agreement, as may be amended from time to time, by and between Salomon
      Smith Barney Inc. as agent for Salomon Brothers International Ltd. and
      NCCC and Annex I thereto, dated as of March 29, 2001 and all other
      documents or agreements executed in connection therewith, or replacement
      facilities with substantially similar terms (including, but not limited
      to, amounts and rates) with financial institutions approved by Buyer.

      "SALOMON NCMC FINANCING FACILITY" shall mean the Letter Agreement, dated
      December 1, 2000, as may be amended from time to time, by and among
      Salomon Brothers Realty Corp., NCCC and NCMC and all other documents or
      agreements executed in connection therewith, or replacement facilities
      with substantially similar terms (including, but not limited to, amounts
      and rates) with financial institutions approved by Buyer.

      "SALOMON REO FINANCING FACILITY" shall mean the Master Loan and Security
      Agreement dated as of April 1, 2000, as may be amended from time to time,
      by and between NCMC, NCCC and SBRC, and all other documents or agreements
      executed in connection therewith, or replacement facilities with
      substantially similar terms (including, but not limited to, amounts and
      rates) with financial institutions approved by Buyer.

                                      -15-
<PAGE>

      "SALOMON RESIDUAL FINANCING FACILITY" shall mean TBMA/ISMA Global Master
      Repurchase Agreement, as may be amended from time to time, by and between
      Salomon Smith Barney Inc as Agent for Salomon Brothers International Ltd.
      and NC Residual II Corporation and Annex I thereto, dated as of March 29,
      2001 and all other documents or agreements executed in connection
      therewith, or replacement facilities with substantially similar terms
      (including, but not limited to, amounts and rates) with financial
      institutions approved by Buyer; provided that amounts available under the
      Salomon Residual Financing Facility may be reduced by up to $2,000,000 per
      month and $9,000,000 per quarter in accordance with its terms.

      "SBRC" shall mean Salomon Brothers Realty Corp., a Delaware corporation.

      "SECOND LIEN MORTGAGE LOANS" shall mean an Eligible Asset secured by a
      lien on the Mortgaged Property, subject to one prior lien on such
      Mortgaged Property.

      "SECOND LIEN SUB-LIMIT" shall mean an amount equal to $20,000,000.

      "SECOND LIEN CLTV SUB-LIMIT" shall mean with respect to Second Lien
      Mortgage Loans with a Combined Loan to Value Ratio of greater than 100%,
      $10,000,000.

      "SECURITY AGREEMENT" shall mean with respect to any Mortgage Loan, any
      contract, instrument or other document related to security for repayment
      thereof (other than the related Mortgage and Mortgage Note), executed by
      the Mortgagor and/or others in connection with such Mortgage Loan,
      including without limitation, any security agreement, guaranty, title
      insurance policy, hazard insurance policy, chattel mortgage, letter of
      credit or certificate of deposit or other pledged accounts, and any other
      documents and records relating to any of the foregoing.

      "SELLER" shall mean NCCC and NCMC.

      "SELLER ASSET SCHEDULE" shall have the meaning assigned thereto in the
      Custodial Agreement.

      "SELLER-RELATED OBLIGATIONS" shall mean any obligations of NCCC or NCMC
      hereunder and under any other arrangement between NCCC, NCMC or an
      Affiliate of NCCC or NCMC on the one hand and Buyer or an Affiliate of
      Buyer on the other hand.

      "SERVICER" shall have the meaning provided in Section 24.

      "SERVICER ACCOUNT" shall mean any account established by Servicer in
      connection with the servicing of the Mortgage Loans.

      "SERVICING AGREEMENT" has the meaning specified in Section 24.

      "SERVICING CONTRACT" shall mean a contract or agreement purchased by NCCC
      or NCMC or entered into by NCCC or NCMC for its own account (and not as
      nominee or subservicer), whether now existing or hereafter purchased or
      entered into, pursuant to

                                      -16-
<PAGE>

      which NCCC or NCMC services Mortgage Loans or Mortgage Loan pools for
      Persons other than itself or the other Seller.

      "SERVICING FILE" means with respect to each Mortgage Loan, the file
      retained by Seller consisting of originals of all documents in the
      Mortgage File which are not delivered to a Custodian and copies of all
      documents in the Mortgage File set forth in Section 2 of the Custodial
      Agreement.

      "SERVICING RECORDS" has the meaning specified in Section 24.

      "SETTLEMENT AGENT" shall mean, with respect to any Transaction, the
      entity, which may be a title company, escrow company or attorney in
      accordance with local law and practice in the jurisdiction where the
      related Wet-Ink Mortgage Loan is being originated, which funds such
      Mortgage Loan with amounts wired pursuant to the terms of an Existing
      Financing Facility.

      "SUB-LIMIT" shall mean any of the Web-Ink Sub-Limit, the Second Lien
      Sub-Limit, the Second Lien CLTV Sub-Limit, the Mortgage Loan Sub-Limit,
      the Jumbo Sub-Limit, the Jumbo(500) Sub-Limit, the Jumbo(750) Sub-Limit at
      any time, the C Credit Sub-Limit and the C Minus Credit Sub-Limit.

      "SUBORDINATED DEBT" shall mean any Indebtedness of NCCC or NCMC, now
      existing or hereafter created, incurred or arising, which is subordinated
      in right of payment to the payment of all obligations hereunder in a
      manner and to an extent that Buyer has approved in writing prior to the
      creation of such Indebtedness.

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

      "TANGIBLE NET WORTH" shall mean on any date of determination, the
      consolidated Net Worth of Guarantor, NCCC or NCMC, as applicable, and its
      respective Subsidiaries, minus the consolidated book value of all assets
      of Guarantor, NCCC or NCMC, as applicable, and its respective Subsidiaries
      (to the extent reflected as an asset in the balance sheet of Guarantor,
      NCCC or NCMC, as applicable, or any such Subsidiary at such date) which
      are treated as intangibles under GAAP, including, without limitation, such
      items as deferred financing expenses, net leasehold improvements, good
      will, trademarks, trade names, service marks, copyrights, patents,
      licenses and unamortized debt discount and expense; provided, that Junior
      Securitization Interests shall not be treated as intangibles for purposes
      of this definition.

                                      -17-
<PAGE>

      "TERM PURCHASED ASSET" shall mean any Purchased Asset for which Buyer and
      Seller shall have agreed that the Repurchase Date is not "open".

      "TERMINATION DATE" shall mean the date which is 364 days from the date
      hereof which shall be July 18, 2002 or such earlier date on which this
      Agreement shall terminate in accordance with the provisions hereof or by
      operation of law, as may be extended pursuant to Section 3(n).

      "TERMINATION FEE" has the meaning specified in Section 3(p).

      "TEST PERIOD" shall mean each consecutive three-month period commencing
      with the three-month period from the Effective Date to the date that is
      three months after the Effective Date, provided that with respect to the
      first Test Period, for purposes of determining if a Non-Use Fee is
      payable, the first Test Period shall begin on August 1, 2001 and end on
      the date that is 3 months after the Effective Date.

      "TOTAL LIABILITIES" shall mean on any date of determination, the amount,
      on a consolidated basis, of the liabilities of Guarantor, NCCC or NCMC, as
      applicable, and its respective Subsidiaries, determined in accordance with
      GAAP, minus Subordinated Debt.

      "TRANSACTION" has the meaning specified in Section 1.

      "TRANSACTION REQUEST" means a request from Seller to Buyer, in the form
      attached as EXHIBIT I hereto, to enter into a Transaction.

      "TRUE SALE CERTIFICATION" shall mean a true sale certification in the form
      of EXHIBIT VI attached hereto.

      "TRUST RECEIPT" shall mean a trust receipt issued by Custodian to Buyer
      confirming Custodian's possession of certain Mortgage Files which are held
      by Custodian for the benefit of Buyer or the registered holder of such
      trust receipt.

      "UBS FINANCING FACILITY" shall mean the Master Loan and Security Agreement
      dated as of July 20, 1999, as may be amended from time to time, by and
      among Seller, NCCC and UBS Real Estate Securities Inc. (formerly known as
      Paine Webber Real Estate Securities Inc.) and all other documents or
      agreements executed in connection therewith, or replacement facilities
      with substantially similar terms (including, but not limited to, amounts
      and rates) with financial institutions approved by Buyer; provided that
      the UBS Financing Facility may be terminated or amounts available to
      Seller thereunder may be reduced so long as it is a result of the
      repayment of all amounts due thereunder other than as a result of an
      acceleration or a default.

      "UNDERWRITING GUIDELINES" shall mean the underwriting guidelines delivered
      by Seller to Buyer on or prior to the Effective Date and as may be
      modified or supplemented from time to time thereafter as approved by Buyer
      in its sole discretion attached hereto as EXHIBIT II.

                                      -18-
<PAGE>

      "UNIFORM COMMERCIAL CODE" or "UCC" shall mean the Uniform Commercial Code
      as in effect on the date hereof in the State of New York; provided that if
      by reason of mandatory provisions of law, the perfection or the effect of
      perfection or non-perfection of the security interest in any Purchased
      Items is governed by the Uniform Commercial Code as in effect in a
      jurisdiction other than New York, "Uniform Commercial Code" shall mean the
      Uniform Commercial Code as in effect in such other jurisdiction for
      purposes of the provisions hereof relating to such perfection or effect of
      perfection or non-perfection.

      "US BANK FINANCING FACILITY" shall mean the Subordinated Loan Agreement by
      and among NCMC and US Bank National Association, dated April 28, 2000, as
      may be amended from time to time, and all other documents or agreements
      executed in connection therewith, or replacement facilities with
      substantially similar terms (including, but not limited to, amounts and
      rates) with financial institutions approved by Buyer.

      "USB FINANCING FACILITY" shall mean the Fifth Amended and Restated Credit
      Agreement dated as of May 23, 2001, as may be amended from time to time,
      by and among NCCC, NCMC and U.S. Bank National Association as agent for
      the lenders thereunder and all other documents or agreements executed in
      connection therewith, or replacement facilities with substantially similar
      terms (including, but not limited to, amounts and rates) with financial
      institutions approved by Buyer; provided that on or prior to July 31, 2001
      Bank United may cease being a lender thereunder and the commitment may be
      reduced by the amount of Bank United's commitment amount.

      "USB SETTLEMENT ACCOUNT" shall mean the following account of U.S. Bank
      National Association as agent for the lenders under the USB Financing
      Facility, U.S. Bank National Association, Minneapolis, Minnesota, ABA #
      0910-0002-2 for credit to New Century Mortgage Corporation, Collateral
      Account #1731-0097-1378.

      "WET-INK MORTGAGE LOAN" shall mean an Eligible Asset which is sold to
      Buyer within 6 Business Days of, the origination thereof by Seller, which
      origination is in accordance with the Underwriting Guidelines and is
      funded in part or in whole with cash advanced directly to the USB
      Settlement Account.

      "WET-INK SUB-LIMIT" shall mean an amount equal to (i) with respect to the
      first five (5) Business Days of each calendar month, $100,000,000, (ii)
      with respect to the last three (3) Business Days of each calendar month,
      $100,000,000 and (iii) at all other times, $80,000,000.

      "WORTH PURCHASE AGREEMENT" shall mean the mortgage loan purchase
      agreement, dated as of July 1, 2001 between Worth Funding Incorporated and
      NCMC, as the same shall be modified and supplemented and in effect from
      time to time, pursuant to which NCMC buys certain of the Eligible Assets
      from Worth Funding Incorporated.

3.    INITIATION; TERMINATION

      (a) CONDITIONS PRECEDENT TO INITIAL TRANSACTION AND INITIAL FUNDING.

                                      -19-
<PAGE>

            (1)   Buyer's obligation to enter into the initial Transaction
                  hereunder is subject to the satisfaction, immediately prior to
                  or concurrently with the making of such Transaction, of the
                  condition precedent that Buyer shall have received from Seller
                  any fees and expenses payable hereunder (including, without
                  limitation, the fee required pursuant to Section 3(q)), and
                  all of the following documents, each of which shall be
                  satisfactory in form and substance to Buyer and its counsel:

                        (A) The following Repurchase Documents delivered to
                        Buyer:

                              (1) MASTER REPURCHASE AGREEMENT. This Master
                        Repurchase Agreement duly completed and executed by the
                        parties thereto. In addition, Seller shall have taken
                        such other action as Buyer shall have requested in order
                        to perfect the security interests created pursuant to
                        this Agreement;

                              (2) CUSTODIAL AGREEMENT. The Custodial Agreement,
                        duly executed and delivered by NCMC, NCCC, Buyer and
                        Custodian. In addition, Seller shall have taken such
                        other action as Buyer shall have requested in order to
                        transfer the Purchased Assets pursuant to this
                        Agreement;

                              (3) GUARANTY. The Guaranty, duly executed and
                        delivered by the parties thereto; and

                              (4) UCC FINANCING STATEMENTS. UCC Financing
                        Statements naming each of NCCC and NCMC as Debtor and
                        Buyer as Secured Party and describing the Purchased
                        Items;

                              (5) OPINIONS OF COUNSEL. An opinion or opinions of
                        outside counsel to each of NCCC, NCMC and Guarantor,
                        substantially in the form of EXHIBIT III;

                              (6) ORGANIZATIONAL DOCUMENTS. A good standing
                        certificate and certified copies of the charter and
                        by-laws (or equivalent documents) of each of NCCC, NCMC
                        and Guarantor and of all corporate or other authority
                        for NCCC, NCMC or Guarantor, as applicable, with respect
                        to the execution, delivery and performance of the
                        Repurchase Documents to which it is a party and each
                        other document to be delivered by NCCC, NCMC or
                        Guarantor from time to time in connection herewith (and
                        Buyer may conclusively rely on such certificate until it
                        receives notice in writing from NCCC, NCMC or Guarantor,
                        as applicable, to the contrary);

                              (7) UNDERWRITING GUIDELINES. A copy of Seller's
                        current Underwriting Guidelines, and any material
                        changes to the Underwriting Guidelines made since the
                        Underwriting Guidelines were last delivered to Buyer;

                                      -20-
<PAGE>

                              (8) SERVICING AGREEMENT(S). Any Servicing
                        Agreement, certified as a true, correct and complete
                        copy of the original; and

                              (9) OTHER DOCUMENTS. Such other documents as Buyer
                        may reasonably request, in form and substance reasonably
                        acceptable to Buyer.

            (2)   Buyer's obligation to enter into the initial purchase of
                  Eligible Assets hereunder is subject to the satisfaction,
                  immediately prior to or concurrently with the making of such
                  Transaction, of the condition precedent that Buyer shall have
                  received from Seller any fees and expenses payable hereunder,
                  and all of the following documents, each of which shall be
                  satisfactory in form and substance to Buyer and its counsel:

                        (A) The following Repurchase Documents delivered to
                        Buyer:

                              (1) ACCOUNT AGREEMENT. An Account Agreement, duly
                        executed and delivered by the parties thereto;

                              (2) CONSENTS AND WAIVERS. Any and all irrevocable
                        consents and waivers required under the Existing
                        Financing Facilities;

                              (3) UCC AMENDMENTS AND RELEASES. Any and all
                        amendments or terminations of UCC financing statements
                        required by Buyer; and

                              (4) WORTH PURCHASE AGREEMENT. A certified copy of
                        the Worth Purchase Agreement;

                              (5) WORTH UCC FINANCING STATEMENTS. A UCC-1
                        Financing Statement naming Worth Funding Incorporated as
                        Debtor and NCMC as Secured Party under the Worth
                        Purchase Agreement and a UCC-3 assignment of such
                        Financing Statement naming Buyer as assignee;

                              (6) SERVICER NOTICE. The Servicer Notice, duly
                        executed and delivered by the parties thereto.

      (b)   CONDITIONS PRECEDENT TO ALL TRANSACTIONS. Buyer's obligation to
            enter into each Transaction (including the initial Transaction) is
            subject to the satisfaction of the following further conditions
            precedent, both immediately prior to entering into such Transaction
            and also after giving effect to the consummation thereof and the
            intended use of the proceeds of the sale:

            (1)   Seller shall have delivered a Transaction Request via
                  Electronic Transmission in accordance with the procedures set
                  forth in Section 3(c);

                                      -21-
<PAGE>

            (2)   no Default or Event of Default shall have occurred and be
                  continuing under the Repurchase Documents;

            (3)   after giving effect to the requested Transaction, the
                  aggregate outstanding Purchase Price of the Transactions
                  outstanding shall not exceed the Maximum Amount;

            (4)   both immediately prior to the requested Transaction and also
                  after giving effect thereto and to the intended use thereof,
                  the representations and warranties made by Seller in Section
                  10, shall be true, correct and complete on and as of such
                  Purchase Date in all material respects with the same force and
                  effect as if made on and as of such date (or, if any such
                  representation or warranty is expressly stated to have been
                  made as of a specific date, as of such specific date);

            (5)   after giving effect to the requested Transaction, the
                  aggregate outstanding Purchase Price of the Transactions
                  outstanding shall not exceed the Asset Value of all the
                  Purchased Assets subject to outstanding Transactions;

            (6)   subject to Buyer's right to perform one or more Due Diligence
                  Reviews pursuant to Section 27, Buyer shall have completed its
                  due diligence review of the Mortgage File for each Purchased
                  Asset, and such other documents, records, agreements,
                  instruments, mortgaged properties or information relating to
                  such Purchased Asset as Buyer in its sole discretion deems
                  appropriate to review and such review shall be satisfactory to
                  Buyer in its sole discretion;

            (7)   Buyer shall have received from Seller certified copies of any
                  Servicing Agreement relating to the Eligible Assets and Buyer
                  shall have reviewed and approved each such Servicing Agreement
                  in its sole discretion;

            (8)   Buyer shall have received all fees and expenses of counsel to
                  Buyer as contemplated by Section 14(b) which amount, at
                  Buyer's option, may be withheld from the sale proceeds of any
                  Transaction hereunder;

            (9)   Buyer shall have approved, in its sole discretion, all
                  exceptions to the Underwriting Guidelines;

            (10)  none of the following shall have occurred and/or be
                  continuing:

                        (A) an event or events shall have occurred in the good
                  faith determination of Buyer resulting in the effective
                  absence of a "repo market" or comparable "lending market" for
                  financing debt obligations secured by mortgage loans or
                  securities or an event or events shall have occurred resulting
                  in Buyer not being able to finance Purchased Assets through
                  the "repo market" or "lending market" with traditional
                  counterparties at rates which would have been reasonable prior
                  to the occurrence of such event or events; or

                                      -22-
<PAGE>

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

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

            (11)  with respect to each Eligible Asset, Buyer shall have received
                  from Custodian a Trust Receipt and a Basic Status Report and
                  Exception Report with exceptions acceptable to Buyer in its
                  sole discretion in respect of Eligible Assets to be purchased
                  hereunder on such Business Day;

            (12)  Buyer shall have received from Seller a Warehouse Lender's
                  Release Letter substantially in the form of EXHIBIT VII-B
                  hereto (or such other form acceptable to Buyer) or a Seller's
                  Release Letter substantially in the form of EXHIBIT VII-A
                  hereto (or such other form acceptable to Buyer) covering each
                  Eligible Asset to be sold to Buyer;

            (13)  The aggregate requested Purchase Price of Eligible Assets that
                  are not Wet-Ink Mortgage Loans that Seller has requested Buyer
                  purchase pursuant to the Transaction Request is equal to or in
                  excess of $10,000,000; and

            (14)  the Repurchase Date for such Transaction is not later than the
                  Termination Date.

      Each Transaction Request delivered by Seller hereunder shall constitute a
      certification by each of NCCC and NCMC that all the conditions set forth
      in this Section 3(b) have been satisfied (both as of the date of such
      notice or request and as of the date of such purchase).

         Each of NCCC and NCMC hereby request that Buyer, on each Business Day,
         convert each Eligible Asset which is a Wet-Ink Mortgage Loan for which
         the Mortgage File has been received by the Custodian in accordance with
         the Custodial Agreement to a dry Mortgage Loan and this request shall
         constitute a certification by each of NCCC and NCMC that all the
         conditions set forth in this Section 3(b) have been satisfied (both as
         of the date hereof and as of the date of such conversion).

      (c)   Seller shall request a Transaction by delivering to Custodian and
            Buyer via Electronic Transmission a request in the form of EXHIBIT I
            attached hereto (a "TRANSACTION REQUEST") no later than (i) 9:00
            a.m. New York time on the requested Purchase Date with respect to
            the initial purchase of each Eligible Asset that is not a Wet-Ink
            Mortgage Loan and with respect to each Wet-Ink Mortgage Loan
            anticipated to be purchased on such Purchase Date (with a final
            Seller Asset

                                      -23-
<PAGE>

            Schedule to be delivered no later than 11:30 a.m. New York time on
            the related Purchase Date) and (ii) 4:00 p.m. New York time on the
            Business Day prior to the date a Wet-Ink Mortgage Loan converts with
            respect to each Wet-Ink Mortgage Loan for which Custodian has
            received the related Mortgage File and there are no Fatal Exceptions
            with respect thereto and such Wet-Ink Mortgage Loan is converting to
            a dry Mortgage Loan on the Purchase Date. Such Transaction Request
            shall describe the Purchased Assets in a Seller Asset Schedule and
            set forth (i) the Purchase Date, (ii) the Purchase Price, (iii) the
            Repurchase Date, (iv) the Pricing Rate applicable to the
            Transaction, (v) the applicable Purchase Percentages and (vi)
            additional terms or conditions not inconsistent with this Agreement.
            Each such Transaction Request in respect of Eligible Assets that are
            not Wet-Ink Mortgage Loans shall be for an aggregate Purchase Price
            equal to or in excess of $10,000,000.

            On each Purchase Date, Buyer shall forward to Seller a confirmation
      (a "CONFIRMATION") by Electronic Transmission setting forth with respect
      to each Transaction funded on such date, (1) the mortgage loan number, (2)
      the Purchase Price for such Purchased Assets, (3) the Market Value of the
      related Mortgage Loans as of the date of such Confirmation, (4) the
      outstanding principal amount of the related Mortgage Loans, (5) the
      Repurchase Date and (6) the Pricing Rate.

            On each date that all the documents set forth in Section 2(a)(i) of
      the Custodial Agreement are received by the Custodian with respect to a
      Wet-Ink Mortgage Loan, and Custodian delivers to Buyer a Trust Receipt
      attaching a Basic Status Report and Exception Report with respect to such
      Eligible Assets, Seller shall forward to Buyer a new Confirmation by
      Electronic Transmission setting forth the following information, updated
      to reflect the revised Pricing Rate, and, if applicable, Market Value as a
      result of the conversion of such Mortgage Loan, (1) the mortgage loan
      number, (2) the Purchase Price for such Purchased Assets, (3) the Market
      Value of the related Mortgage Loans, (4) the outstanding principal amount
      of the related Mortgage Loans, (5) the Repurchase Date and (6) the Pricing
      Rate.

            In the event Seller disagrees with any terms of the Confirmation and
      Seller shall notify Buyer in writing of such disagreement within one (1)
      Business Day after receipt of such Confirmation unless a corrected
      Confirmation is sent by Buyer. An objection sent by Seller must state
      specifically that it is an objection, must specify the provision(s) being
      objected to by Seller, must set forth such provision(s) in the manner that
      Seller believes they should be stated, and must be received by Buyer no
      more than one (1) Business Day after the Confirmation was received by
      Seller.

      (d)   Any Confirmation by Buyer shall be deemed to have been received by
            Seller on the date actually received by Seller.

      (e)   Except as set forth in Section 3(c), each Confirmation, together
            with this Agreement, shall constitute conclusive evidence of the
            terms agreed between Buyer and Seller with respect to the
            Transaction to which the Confirmation relates, and Seller's
            acceptance of the related proceeds shall constitute Seller's

                                      -24-
<PAGE>

            agreement to the terms of such Confirmation. It is the intention of
            the parties that each Confirmation shall not be separate from this
            Agreement but shall be made a part of this Agreement.

      (f)   On the Repurchase Date, termination of a Transaction will be
            effected by transfer to Seller or its designee of the Purchased
            Assets (and any Income in respect thereof received by Buyer not
            previously credited or transferred to, or applied to the obligations
            of, Seller pursuant to Section 5) which amount shall be netted
            against the simultaneous receipt of the Repurchase Price by Buyer.
            To the extent a net amount is owed to one party, the other party
            shall pay such amount to the party. Seller is obligated to obtain
            the Mortgage Files from Buyer or its designee (including Custodian)
            at Seller's expense on the Repurchase Date.

      (g)   Subject to the terms and conditions of this Agreement, during the
            term of this Agreement Seller may sell to Buyer, repurchase from
            Buyer and resell to Buyer Eligible Assets hereunder.

      (h)   In no event shall a Transaction be entered into when any Default or
            Event of Default has occurred and is continuing or when the
            Repurchase Date for such Transaction would be later than the
            Termination Date.

      (i)   With respect to each Eligible Asset that is not a Wet-Ink Mortgage
            Loan, no later than 12:00 noon, New York time, two (2) Business Days
            prior to the requested Purchase Date (or such lesser time as
            Custodian and Seller may agree), Seller shall deliver to Custodian
            the Mortgage File, as applicable, pertaining to each Eligible Asset
            to be purchased by Buyer.

      (j)   With respect to each Eligible Asset that is not a Wet-Ink Mortgage
            Loan, pursuant to the Custodial Agreement, Custodian shall deliver
            to Buyer and Seller, by no later than 11:30 a.m., New York time on a
            Purchase Date, a Trust Receipt in respect of all such Eligible
            Assets purchased by Buyer on such Purchase Date. Subject to the
            provisions of this Section 3, the Purchase Price for each Eligible
            Asset which is not a Wet-Ink Mortgage Loan will then be made
            available to Seller by Buyer transferring via wire transfer, in the
            aggregate amount of such Purchase Price in funds immediately
            available pursuant to wire instructions set forth in the Transaction
            Request (subject to the purchase limits set forth herein). Pursuant
            to the Custodial Agreement, Custodian shall deliver to Buyer a Basic
            Status Report and Exception Report no later than 11:00 a.m. New York
            time on each Purchase Date.

      (k)   With respect to each Eligible Asset that is a Wet-Ink Mortgage Loan,
            pursuant to the Custodial Agreement, Custodian shall deliver to
            Buyer and Seller, by no later than 11:30 a.m., New York time on a
            Purchase Date, a Trust Receipt in respect of all such Wet-Ink
            Mortgage Loans purchased by Buyer on such Purchase Date. Subject to
            the provisions of this Section 3, the Purchase Price for each
            Eligible Asset which is a Wet-Ink Mortgage Loan will then be made
            available to Seller by Buyer transferring, via wire transfer, to the
            USB Settlement Account, in the

                                      -25-
<PAGE>

            aggregate amount of such Purchase Price in funds immediately
            available to the USB Account. Seller shall deliver the Mortgage File
            related thereto to Custodian, for receipt by Custodian no later than
            seven (7) Business Days following the Origination Date of such
            Wet-Ink Mortgage Loan.

      (l)   Seller may repurchase any individual Purchased Asset without penalty
            or premium, but subject to the last sentence of this Section 3(l),
            on any date. The Repurchase Price payable for the repurchase of any
            such Purchased Asset shall be reduced as provided in Section 5(e).
            If Seller intends to make such a repurchase, Seller shall give one
            (1) Business Day's prior written notice thereof to Buyer,
            designating the Purchased Assets to be repurchased. If such notice
            is given, the amount specified in such notice shall be due and
            payable on the date specified therein, and, on receipt, such amount
            shall be applied to the Repurchase Price for the designated
            Purchased Assets. The amount of the original Purchase Price of the
            Purchased Assets thus repurchased shall be available for subsequent
            Transactions subject to the terms of this Agreement. If any Term
            Purchased Asset is repurchased on any date other than the Repurchase
            Date for such Term Purchased Asset, Seller shall pay to Buyer any
            amount determined by Buyer in its sole discretion, exercised in good
            faith, as necessary to compensate Buyer for any additional losses,
            costs or expenses which it may reasonably incur as a result of such
            repurchase, including, without limitation, any loss, cost or expense
            incurred by reason of the liquidation or reemployment of deposits or
            other funds acquired by Buyer to fund or maintain such Transaction.

      (m)   [Reserved]

      (n)   At the request of Seller made at least 90 days, but in no event
            earlier than 360 days, prior to the then current Termination Date,
            Buyer may in its sole discretion extend the Termination Date for a
            period of 364 additional days or such other period to be determined
            by Buyer in its sole discretion by giving written notice of such
            extension to Seller no later than sixty (60) days after Buyer's
            receipt of Seller's request. Any failure by Buyer to deliver such
            notice of extension shall be deemed to be Buyer's determination not
            to extend the then current Termination Date.

      (o)   [Reserved]

      (p)   In the event Seller fails to maintain the average aggregate
            principal balance of Transactions outstanding hereunder for any Test
            Period equal to at least $120,000,000, Seller agrees to pay to Buyer
            on the fifth (5th) Business Day of the next succeeding calendar
            month a non-use fee (the "NON-USE FEE") equal to 25 basis points
            (0.25%) per annum of the amount equal to the Maximum Amount less the
            average aggregate principal balance of Transactions outstanding
            hereunder over such Test Period; provided that the Seller shall not
            be required to pay such Non-Use Fee if, during the applicable Test
            Period, the Buyer's determination of Market Value resulted in
            Purchase Prices with respect to a requested Transaction during such
            Test Period equal to less than 99% of the

                                      -26-
<PAGE>

            outstanding principal balance of the Eligible Assets Seller
            requested Buyer purchase during such Test Period. No Non-Use Fee
            shall be payable by Seller if Buyer does not purchase any Eligible
            Assets during such Test Period due to the occurrence of any event
            set forth in Section 3(b)(10). In addition, in the event Seller
            terminates this Agreement in accordance with Section 20, Seller
            shall pay to Buyer on the fifth (5th) Business Day of the next
            succeeding calendar month a termination fee (the "TERMINATION FEE")
            equal to a percentage per annum equal to the Early Termination
            Percentage, calculated based on the actual number of days remaining
            and assuming a 360 day year, of the Maximum Amount for the period
            commencing on the date of such termination and ending on the
            original Termination Date, as may have been extended pursuant to
            Section 3(n); provided, however, that if Buyer assigns its
            obligation to purchase Eligible Assets from Seller under this
            Agreement, no Termination Fee will be payable by Seller in the event
            Seller terminates this Agreement in accordance with Section 20. All
            such payments pursuant to this clause (p) shall be made in Dollars,
            in immediately available funds, without deduction, set-off or
            counterclaim, to Buyer at the account set forth in Section 8(a)
            hereof.

      (q)   Seller agrees to pay to Buyer on or prior to the Effective Date a
            facility fee equal to 12.5 basis points (0.125%) per annum of the
            Maximum Amount, such payment to be made in Dollars, in immediately
            available funds, without deduction, set-off or counterclaim, to
            Buyer at the account set forth in Section 8(a) hereof.

      (r)   On any day on which the Margin Base exceeds the aggregate
            outstanding Purchase Price of all Transactions, so long as no
            Default or Event of Default has occurred and is continuing:

            (1)   Seller may prepare a Request for Additional Transactions for
                  Excess Margin in the form of EXHIBIT IX attached hereto
                  ("REQUEST FOR ADDITIONAL TRANSACTIONS FOR EXCESS MARGIN"),
                  specifying (i) the Eligible Assets and increase in Purchase
                  Price for which a Transaction is sought and the requested
                  Purchase Date, (ii) the Margin Base with respect to such
                  Eligible Assets sold hereunder before giving effect to the
                  requested Transaction, (iii) the Margin Base after giving
                  effect to the additional Transactions for such Eligible
                  Assets, (iv) the aggregate outstanding Purchase Price of the
                  Transactions prior to giving effect to the requested
                  Transaction, and (v) an officer's certificate from Seller
                  certifying that, upon the consummation of the additional
                  Transactions, the Margin Base would be equal to or greater
                  than the aggregate outstanding Purchase Price of all
                  Transactions, and the excess of the Margin Base over the
                  aggregate outstanding Purchase Price, after giving effect to
                  the Transaction, shall be the "EXCESS MARGIN".

            (2)   Seller shall transmit via Electronic Transmission the Request
                  for Additional Transactions for Excess Margin to Buyer prior
                  to 12:00 noon New York time on the requested Purchase Date.
                  Upon confirming that the Request for Additional Transactions
                  for Excess Margin correctly reflects

                                      -27-
<PAGE>

                  the information set forth in Section 3(r)(1) and that, after
                  giving effect to the requested Transaction, the amount of the
                  Margin Base would be equal to or greater than the aggregate
                  outstanding Purchase Prices of all Transactions, Buyer shall
                  remit the additional Purchase Price in the amount set forth in
                  such Request for Additional Transactions for Excess Margin and
                  send a revised Confirmation with respect to such Purchased
                  Assets. In the event that Buyer's assessment of the Margin
                  Base would alter the information set forth in any Request for
                  Additional Transactions for Excess Margin, Buyer shall
                  promptly notify Seller in writing of such assessment.

            (3)   Buyer shall not be obligated to remit the additional Purchase
                  Price requested pursuant to a Request for Additional
                  Transactions for Excess Margin which (i) Buyer reasonably
                  determines is based on erroneous information or would result
                  in a Transaction not in accordance with the terms of this
                  Agreement, or (ii) does not reflect Buyer's current
                  determination of Market Value as provided in the definition
                  thereof.

4.    MARGIN AMOUNT MAINTENANCE

      (a)   If at any time the Margin Base is less than the aggregate Purchase
            Price for all outstanding Transactions (a "MARGIN DEFICIT"), then
            Buyer may by notice to Seller (as such notice is more particularly
            set forth below, a "MARGIN DEFICIT NOTICE"), require Seller to
            transfer to Buyer or its designee (including Custodian) cash or
            Eligible Assets ("ADDITIONAL PURCHASED ASSETS") so that the
            aggregate Asset Value of the Purchased Assets, including any such
            Additional Purchased Assets, will thereupon equal or exceed the
            aggregate Purchase Prices for such Purchased Assets. If Buyer
            delivers a Margin Deficit Notice to Seller on or prior to 6 p.m.
            (New York time) on any Business Day, then Seller shall transfer
            Additional Purchased Assets to Buyer no later than 5 p.m. (New York
            time) the following Business Day. In the event Buyer delivers a
            Margin Deficit Notice to Seller after 6 p.m. (New York time) on any
            Business Day, then such Margin Deficit Notice shall be deemed to
            have been delivered on the following Business Day and Seller shall
            be required to transfer Additional Purchased Assets no later than 5
            p.m. (New York time) on the subsequent Business Day. All cash
            transferred to Buyer pursuant to this Section 4(a) shall be
            deposited in the account set forth in Section 8(a) hereof and shall
            be deemed to reduce the aggregate Purchase Price with respect to all
            outstanding Transactions.

      (b)   Buyer's election, in its sole and absolute discretion, not to
            deliver a Margin Deficit Notice at any time there is a Margin
            Deficit shall not in any way limit or impair its right to deliver a
            Margin Deficit Notice at any time a Margin Deficit exists.

                                      -28-
<PAGE>

5.    INCOME PAYMENTS

      (a)   Where a particular Transaction's term extends over an Income payment
            date on the Purchased Assets subject to that Transaction such Income
            shall be the property of Buyer. Notwithstanding the foregoing, Buyer
            agrees that until an Event of Default has occurred and is continuing
            and Buyer otherwise directs, Servicer shall continue to remit Income
            in accordance with the Servicer Notice and Account Agreement.

      (b)   Notwithstanding that Buyer and Seller intend that the Transactions
            hereunder be sales to Buyer of the Purchased Assets, Seller shall
            pay to Buyer the accreted value of the Price Differential (less any
            amount of such Price Differential previously paid by Seller to
            Buyer) of each Transaction (each such payment, a "PERIODIC ADVANCE
            REPURCHASE PAYMENT") on each Payment Date. If Seller fails to make
            all or part of the Periodic Advance Repurchase Payment by 5:00 p.m.
            (New York time) on the Payment Date, Seller shall be obligated to
            pay to Buyer (in addition to, and together with, the Periodic
            Advance Repurchase Payment) interest on the unpaid amount of the
            Periodic Advance Repurchase Payment at a rate per annum equal to the
            Post-Default Rate (the "LATE PAYMENT FEE") until the overdue
            Periodic Advance Repurchase Payment is received in full by Buyer.

      (c)   Seller shall hold for the benefit of, and in trust for, Buyer all
            income, including without limitation all Income received by or on
            behalf of Seller with respect to such Purchased Assets. Seller shall
            instruct Servicer to deposit such Income in a deposit account (the
            title of which shall indicate that the funds therein are being held
            in trust for Buyer) (the "COLLECTION ACCOUNT") with the Bank and
            which is subject to the Account Agreement. All such Income shall be
            held in trust for Buyer, shall constitute the property of Buyer and
            shall not be commingled with other property of Seller, any affiliate
            of Seller or the applicable Servicer except as expressly permitted
            above. Funds deposited in the Collection Account during any month
            shall be held therein, in trust for Buyer.

      (d)   Notwithstanding the preceding provisions, if an Event of Default has
            occurred, all funds in the Collection Account shall be withdrawn and
            applied as determined by Buyer.

      (e)   Buyer shall offset against the Repurchase Price of each such
            Transaction all Income and Periodic Advance Repurchase Payments
            actually received by Buyer for such Transaction pursuant to Sections
            5(a) and (b) as of the applicable Repurchase Date, respectively,
            excluding any Late Payment Fees paid pursuant to Section 5(b); it
            being understood that the Late Payment Fees are properties of Buyer
            that are not subject to offset against the Repurchase Price.

6.    REQUIREMENTS OF LAW

      (a)   If any Requirement of Law (other than with respect to any amendment
            made to Buyer's certificate of incorporation and by-laws or other
            organizational or

                                      -29-
<PAGE>

            governing documents) or any change in the interpretation or
            application thereof or compliance by Buyer with any request or
            directive (whether or not having the force of law) from any central
            bank or other Governmental Authority made subsequent to the date
            hereof:

            (1)   shall subject Buyer to any tax of any kind whatsoever with
                  respect to this Agreement or any Transaction (excluding net
                  income taxes) or change the basis of taxation of payments to
                  Buyer in respect thereof;

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

            (3)   shall impose on Buyer any other condition;

            and the result of any of the foregoing is to increase the cost to
      Buyer, by an amount which Buyer deems to be material, of entering,
      continuing or maintaining any Transaction or to reduce any amount due or
      owing hereunder in respect thereof, then, in any such case, Seller shall
      promptly pay Buyer such additional amount or amounts as calculated by
      Buyer in good faith as will compensate Buyer for such increased cost or
      reduced amount receivable.

      (b)   If Buyer shall have determined that the adoption of or any change in
            any Requirement of Law (other than with respect to any amendment
            made to Buyer's certificate of incorporation and by-laws or other
            organizational or governing documents) regarding capital adequacy or
            in the interpretation or application thereof or compliance by Buyer
            or any corporation controlling Buyer with any request or directive
            regarding capital adequacy (whether or not having the force of law)
            from any Governmental Authority made subsequent to the date hereof
            shall have the effect of reducing the rate of return on Buyer's or
            such corporation's capital as a consequence of its obligations
            hereunder to a level below that which Buyer or such corporation
            could have achieved but for such adoption, change or compliance
            (taking into consideration Buyer's or such corporation's policies
            with respect to capital adequacy) by an amount deemed by Buyer to be
            material, then from time to time, Seller shall promptly pay to Buyer
            such additional amount or amounts as will compensate Buyer for such
            reduction.

      (c)   If Buyer becomes entitled to claim any additional amounts pursuant
            to this Section, (i) it shall promptly notify Seller of the event by
            reason of which it has become so entitled and (ii) at the sole
            option of Buyer, (x) Buyer may terminate this Agreement and Seller
            shall not be required to pay any Termination Fee or (y) this
            Agreement shall continue in full force and effect, but, Seller shall
            not be required to pay any Non-Use Fee with respect to each Test
            Period during which Buyer is entitled to such additional amounts
            solely under this Section. A

                                      -30-
<PAGE>

            certificate as to any additional amounts payable pursuant to this
            Section submitted by Buyer to Seller shall be conclusive in the
            absence of manifest error.

7.    SECURITY INTEREST

      (a)   Each of the following items or types of property, whether now owned
            or hereafter acquired, now existing or hereafter created and
            wherever located, is hereinafter referred to as the "PURCHASED
            ITEMS": all Mortgage Loans, all rights under each Purchase Agreement
            (but not the obligations thereunder), all rights of NCMC under the
            Worth Purchase Agreement with respect to Mortgage Loans originated
            by Worth Funding Incorporated, all Mortgage Files, including without
            limitation all promissory notes, all Servicing Records relating to
            the Mortgage Loans (as defined in Section 24(c)), all Servicing
            Agreements relating to the Mortgage Loans and any other collateral
            pledged or otherwise relating to such Mortgage Loans, together with
            all files, documents, instruments, surveys, certificates,
            correspondence, appraisals, computer programs, computer storage
            media, accounting records and other books and records relating
            thereto, all mortgage guaranties and insurance (issued by
            governmental agencies or otherwise) and any mortgage insurance
            certificate or other document evidencing such mortgage guaranties or
            insurance relating to any Mortgage Loan, all servicing fees to which
            such Seller is entitled and servicing and other rights relating to
            the Mortgage Loans, all Servicer Accounts established pursuant to
            any Servicing Agreement and all amounts on deposit therein, from
            time to time, all Purchase Agreements or other agreements or
            contracts relating to, constituting, or otherwise governing, any or
            all of the foregoing to the extent they relate to the Purchased
            Assets including the right to receive principal and interest
            payments with respect to the Purchased Assets and the right to
            enforce such payments, the Collection Account and all monies from
            time to time on deposit in the Collection Account, all "general
            intangibles", "accounts", "chattel paper", "deposit accounts" and
            "investment property" as defined in the Uniform Commercial Code as
            in effect from time to time relating to or constituting any and all
            of the foregoing, and any and all replacements, substitutions,
            distributions on or proceeds of any and all of the foregoing.

      (b)   Buyer and Seller intend that the Transactions hereunder be sales to
            Buyer of the Purchased Assets and not loans from Buyer to Seller
            secured by the Purchased Assets. However, in order to preserve
            Buyer's rights under this Agreement in the event that a court or
            other forum recharacterizes the Transactions hereunder as loans and
            as security for the performance by Seller of all of Seller's
            obligations to Buyer hereunder and the Transactions entered into
            hereunder ("REPURCHASE OBLIGATIONS") and the Seller-Related
            Obligations, each of NCCC and NCMC hereby assigns, pledges and
            grants a security interest in all of its right, title and interest
            in, to and under the Purchased Items and Purchased Assets to Buyer
            to secure the Repurchase Obligations and Seller-Related Obligations,
            including without limitation the repayment of all amounts owing to
            Buyer hereunder. The assignment, pledge and grant of security
            interest contained herein shall be, and each of NCCC and NCMC hereby
            represents and warrants to Buyer that it is, a

                                      -31-
<PAGE>

            first priority perfected security interest. Each of NCCC and NCMC
            agrees to mark its computer records and tapes to evidence the
            interests granted to Buyer hereunder. All Purchased Items shall
            secure the payment of all obligations of Seller now or hereafter
            existing under this Agreement, including, without limitation,
            Seller's obligation to repurchase Purchased Assets, or if such
            obligation is so recharacterized as a loan, to repay such loan, for
            the Repurchase Price and to pay any and all other amounts owing to
            Buyer hereunder.

      (c)   Pursuant to the Custodial Agreement, Custodian shall hold the
            Mortgage Files as exclusive bailee and agent for Buyer pursuant to
            the terms of the Custodial Agreement and shall deliver to Buyer
            Trust Receipts each to the effect that it has reviewed such Mortgage
            Files in the manner and to the extent required by the Custodial
            Agreement and identifying any deficiencies in such Mortgage Files as
            so reviewed.

8.    PAYMENT, TRANSFER AND CUSTODY

      (a)   Unless otherwise mutually agreed in writing, all transfers of funds
            to be made by Seller hereunder shall be made in Dollars, in
            immediately available funds, without deduction, set-off or
            counterclaim, to Buyer at the following account maintained by Buyer;
            Account No. GLA 111569 SER, for the account of CDC Mortgage Capital,
            Inc., Bank of New York, ABA No. 021000018, Attn: Chin-Yong Choe not
            later than 3 p.m. New York time, on the date on which such payment
            shall become due (and each such payment made after such time shall
            be deemed to have been made on the next succeeding Business Day).
            Notwithstanding the preceding sentence, on each Repurchase Date,
            Seller shall remit payment of the Repurchase Price to the Settlement
            Account in accordance with Section 11 of the Custodial Agreement.
            Seller acknowledges that it has no rights of withdrawal from the
            foregoing account.

      (b)   On the Purchase Date for each Transaction, ownership of the
            Purchased Assets shall be transferred to Buyer or its designee
            (including Custodian) against the simultaneous transfer of the
            Purchase Price to the account designated pursuant to the wire
            instructions in the related Seller Asset Schedule, not later than 6
            p.m. New York time, simultaneously with the delivery to Custodian of
            the Purchased Assets relating to each Transaction. Each of NCCC and
            NCMC hereby sells, transfers, conveys and assigns to Buyer or its
            designee (including Custodian) without recourse, but subject to the
            terms of this Agreement, all the right, title and interest of NCCC
            and NCMC, as applicable, in and to the Purchased Assets together
            with all right, title and interest in and to the proceeds of any
            related Purchased Items.

      (c)   In connection with such sale, transfer, conveyance and assignment,
            on or prior to each Purchase Date, Seller shall deliver or cause to
            be delivered and released to Buyer or its designee (including
            Custodian) (i) the Custodial Identification Certificate and (ii) the
            documents identified in the Custodial Agreement.

                                      -32-
<PAGE>

      (d)   Any Mortgage Files not delivered to Buyer or its designee (including
            Custodian) are and shall be held in trust by Seller or its designee
            for the benefit of Buyer as the owner thereof. Seller or its
            designee shall maintain a copy of the Mortgage File and the
            originals of the Mortgage File not delivered to Buyer or its
            designee (including Custodian). The possession of the Mortgage File
            by Seller or its designee is at the will of Buyer for the sole
            purpose of servicing the related Purchased Mortgage Loan, and such
            retention and possession by Seller or its designee is in a custodial
            capacity only. Each Mortgage File retained or held by Seller or its
            designee shall be segregated on Seller's books and records from the
            other assets of Seller or its designee and the books and records of
            Seller or its designee shall be marked appropriately to reflect
            clearly the sale of the related Purchased Mortgage Loan to Buyer.
            Seller or its designee shall release its custody of the Mortgage
            File only in accordance with written instructions from Buyer, unless
            such release is required as incidental to the servicing of the
            Purchased Assets or is in connection with a repurchase of any
            Purchased Asset by Seller.

9.    HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS

      Title to all Purchased Assets and Purchased Items shall pass to Buyer and
      Buyer shall have free and unrestricted use of all Purchased Assets and
      Purchased Items. Nothing in this Agreement shall preclude Buyer from
      engaging in repurchase transactions with the Purchased Assets and
      Purchased Items or otherwise pledging, repledging, transferring,
      hypothecating, or rehypothecating the Purchased Assets and Purchased
      Items, all on terms that Buyer may determine in its sole discretion.
      Nothing contained in this Agreement shall obligate Buyer to segregate any
      Purchased Assets or Purchased Items delivered to Buyer by Seller.

10.   SELLER'S REPRESENTATIONS

      Each of NCCC and NCMC represents and warrants to Buyer that as of the
      Purchase Date for the purchase of any Purchased Assets by Buyer from
      Seller and as of the date of this Agreement and any Transaction hereunder
      and at all times while the Repurchase Documents and any Transaction
      hereunder is in full force and effect:

      (a)   ACTING AS PRINCIPAL. Seller will engage in such Transactions as
            principal (or, if agreed in writing in advance of any Transaction by
            the other party hereto, as agent for a disclosed principal).

      (b)   SOLVENCY. Neither the Repurchase Documents nor any Transaction
            thereunder are entered into in contemplation of insolvency or with
            intent to hinder, delay or defraud any of Seller's creditors. The
            transfer of the Mortgage Loans subject hereto and the obligation to
            repurchase such Mortgage Loans is not undertaken with the intent to
            hinder, delay or defraud any of Seller's creditors. Seller is not
            insolvent within the meaning of 11 U.S.C. Section 101(32) or any
            successor provision thereof and the transfer and sale of the
            Mortgage Loans pursuant hereto and the obligation to repurchase such
            Mortgage Loan (i) will not cause Seller to

                                      -33-
<PAGE>

            become insolvent, (ii) will not result in Seller having unreasonably
            small capital, and (iii) will not result in debts that would be
            beyond Seller's ability to pay as the same mature. Seller received
            reasonably equivalent value in exchange for the transfer and sale of
            the Purchased Assets and Purchased Items subject hereto.

      (c)   NO BROKER. Seller has not dealt with any broker, investment banker,
            agent, or other person, except for Buyer, who may be entitled to any
            commission or compensation in connection with the sale of Purchased
            Assets pursuant to this Agreement.

      (d)   ABILITY TO PERFORM. Seller does not believe, nor does it have any
            reason or cause to believe, that it cannot perform each and every
            covenant contained in the Repurchase Documents applicable to it to
            which it is a party.

      (e)   NO DEFAULTS. No Default or Event of Default has occurred and is
            continuing hereunder.

      (f)   LEGAL NAME; EXISTENCE. NCMC's exact legal name is New Century
            Mortgage Corporation. NCCC's exact legal name is NC Capital
            Corporation. Each of NCCC and NCMC (a) is a corporation duly
            organized, validly existing and in good standing under the laws of
            California, (b) has all requisite corporate or other power, and has
            all governmental licenses, authorizations, consents and approvals
            necessary to own its assets and carry on its business as now being
            or as proposed to be conducted, except where the lack of such
            licenses, authorizations, consents and approvals would not be
            reasonably likely to have a Material Adverse Effect; and (c) is
            qualified to do business and is in good standing in all other
            jurisdictions in which the nature of the business conducted by it
            makes such qualification necessary, except where failure so to
            qualify could not be reasonably likely (either individually or in
            the aggregate) to have a Material Adverse Effect.

      (g)   FINANCIAL CONDITION. Seller has heretofore furnished to Buyer a copy
            of (a) its consolidated balance sheet for the fiscal year ended
            December 31, 2000, and the related consolidated statements of income
            and retained earnings and of cash flows for Seller and its
            consolidated Subsidiaries for such fiscal year, each audited by and
            with the unqualified opinion thereon of KPMG LLP and (b) its
            consolidated balance sheet for the quarterly fiscal period of Seller
            as of March 31, 2001 and its consolidated balance sheet as of May
            31, 2001 and the related consolidated statements of income and
            retained earnings and of cash flows for Seller and its consolidated
            Subsidiaries for such periods, setting forth in each case in
            comparative form the figures for the previous year. All such
            financial statements are complete and correct and fairly present, in
            all material respects, the consolidated financial position of Seller
            and its Subsidiaries and the consolidated results of their
            operations as at such dates and for such fiscal periods, all in
            accordance with GAAP applied on a consistent basis. Since May 31,
            2001, there has been no material adverse change in the consolidated
            business, operations or financial condition of Seller and its
            consolidated Subsidiaries taken as a whole from that set forth in
            said financial statements.

                                      -34-
<PAGE>

      (h)   LITIGATION. There are no actions, suits, arbitrations,
            investigations (including, without limitation, any of the foregoing
            which are pending or threatened) or other legal or arbitrable
            proceedings affecting Seller or any of its Subsidiaries or affecting
            any of the Property of any of them before any Governmental Authority
            which (i) questions or challenges the validity or enforceability of
            the Repurchase Documents or any action to be taken in connection
            with the transactions contemplated hereby, (ii) makes a claim or
            claims in an aggregate amount greater than $500,000 except as set
            forth on Schedule 3, or (iii) individually or in the aggregate, if
            adversely determined, could reasonably be likely to have a Material
            Adverse Effect.

      (i)   NO BREACH. Neither (a) the execution and delivery of the Repurchase
            Documents nor (b) the consummation of the transactions therein
            contemplated to be entered into by Seller in compliance with the
            terms and provisions thereof will conflict with or result in a
            breach of the organizational documents of NCCC, NCMC or Guarantor,
            or any applicable law, rule or regulation, or any order, writ,
            injunction or decree of any Governmental Authority, or any Servicing
            Agreement or other material agreement or instrument to which NCCC,
            NCMC, Guarantor or any of their respective Subsidiaries is a party
            or by which any of them or any of their Property is bound or to
            which any of them is subject, or constitute a default under any such
            material agreement or instrument or result in the creation or
            imposition of any Lien (except for the Liens created pursuant to the
            Repurchase Documents) upon any Property of NCCC, NCMC or Guarantor,
            or any of their respective Subsidiaries pursuant to the terms of any
            such agreement or instrument, other than a breach or default for
            which a consent or waiver has been obtained pursuant to Section
            3(a)(1)(F).

      (j)   ACTION. Each of NCCC, NCMC and Guarantor has all necessary corporate
            or other power, authority and legal right to execute, deliver and
            perform its obligations under each of the Repurchase Documents to
            which it is a party, as applicable; the execution, delivery and
            performance by NCCC, NCMC or Guarantor of each of the Repurchase
            Documents to which it is a party have been duly authorized by all
            necessary corporate or other action on its part; and each Repurchase
            Document to which it is a party has been duly and validly executed
            and delivered by NCCC, NCMC or Guarantor, as applicable, and
            constitutes a legal, valid and binding obligation of NCCC, NCMC or
            Guarantor, as applicable, enforceable against NCCC, NCMC or
            Guarantor, as applicable, in accordance with its terms.

      (k)   APPROVALS. No authorizations, approvals or consents of, and no
            filings or registrations with, any Governmental Authority or any
            securities exchange are necessary for the execution, delivery or
            performance by NCCC, NCMC or Guarantor, as applicable, of the
            Repurchase Documents to which it is a party or for the legality,
            validity or enforceability thereof, except for filings and
            recordings in respect of the Liens created pursuant to the
            Repurchase Documents.

                                      -35-
<PAGE>

      (l)   MARGIN REGULATIONS. Neither any Transaction hereunder, nor the use
            of the proceeds thereof, will violate or be inconsistent with the
            provisions of Regulation T, U or X.

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

      (n)   INVESTMENT COMPANY ACT. None of NCCC, NCMC, Guarantor nor any of
            their respective Subsidiaries is an "investment company", or a
            company "controlled" by an "investment company," within the meaning
            of the Investment Company Act of 1940, as amended.

      (o)   PURCHASED ASSETS.

            (1)   Neither NCCC nor NCMC has assigned, pledged, or otherwise
                  conveyed or encumbered any Mortgage Loan to any other Person
                  (except as between any of NCCC, Worth Funding Incorporated and
                  NCMC), and immediately prior to the sale of such Mortgage Loan
                  to Buyer, NCCC and/or NCMC was the sole owner of such Mortgage
                  Loan and had good and marketable title thereto, free and clear
                  of all Liens, in each case except for Liens to be released
                  simultaneously with the sale to Buyer hereunder. No Mortgage
                  Loan sold to Buyer hereunder was acquired (by purchase or
                  otherwise) by NCCC or NCMC from an Affiliate of NCCC or NCMC
                  (except as between any of NCCC, Worth Funding Incorporated and
                  NCMC), as applicable unless a True Sale Certification has been
                  delivered to Buyer.

            (2)   The provisions of this Agreement are effective to either
                  constitute a sale of Purchased Items to Buyer or to create in
                  favor of Buyer a valid security interest in all right, title
                  and interest of NCCC and NCMC in, to and under the Purchased
                  Items.

            (3)   Upon receipt by Custodian of each Mortgage Note, endorsed in
                  blank by a duly authorized officer of NCCC or NCMC, as
                  applicable, either a purchase shall have been completed by
                  Buyer of each Mortgage Note or Buyer shall have a valid and
                  fully perfected first priority security interest in the
                  applicable Mortgage Note and in such Seller's interest in the
                  related Mortgaged Property.

                                      -36-
<PAGE>

            (4)   Upon the filing of financing statements on Form UCC-1 naming
                  Buyer as "Secured Party", and NCCC and NCMC as "Debtor" and
                  describing the Purchased Items, in the jurisdictions and
                  recording offices listed on EXHIBIT IV attached hereto, the
                  security interests granted hereunder in the Purchased Items
                  will constitute fully perfected first priority security
                  interests under the Uniform Commercial Code in all right,
                  title and interest of NCCC and NCMC in, to and under such
                  Purchased Items, which can be perfected by filing under the
                  Uniform Commercial Code.

            (5)   Upon execution and delivery of the Account Agreement, Buyer
                  shall either be the owner of, or have a valid and fully
                  perfected first priority security interest in, the investment
                  property and all deposit accounts comprising Purchased Items.

            (6)   With respect to each Purchased Asset, each of the
                  representations and warranties on Schedule 1 is true and
                  correct.

      (p)   CHIEF EXECUTIVE OFFICE/JURISDICTION OF ORGANIZATION. On the
            Effective Date, and during the four months immediately preceding the
            Effective Date, each of NCCC and NCMC's chief executive office, is,
            and has been located at 18400 Von Karman, Suite 1000, Irvine,
            California 92612. On the Effective Date, each of NCCC and NCMC's
            jurisdiction of organization is California.

      (q)   LOCATION OF BOOKS AND RECORDS. The location where each of NCCC and
            NCMC keeps its books and records, including all computer tapes and
            records related to the Purchased Items is its chief executive
            office.

      (r)   RESERVED.

      (s)   SERVICING AGREEMENTS. Seller has delivered to Buyer all Servicing
            Agreements with respect to the Purchased Mortgage Loans and no
            default or event of default exists thereunder.

      (t)   EXISTING FINANCING FACILITIES. Seller has delivered to Buyer copies
            of all Existing Financing Facilities and no defaults or events of
            default exist thereunder.

      (u)   TRUE AND COMPLETE DISCLOSURE. (a) The information, reports,
            financial statements, exhibits and schedules furnished in writing by
            or on behalf of NCCC, NCMC or Guarantor to Buyer in connection with
            the negotiation, preparation or delivery of this Agreement and the
            other Repurchase Documents or included herein or therein or
            delivered pursuant hereto or thereto (other than with respect to the
            Mortgage Loans), when taken as a whole, do not contain any untrue
            statement of material fact or omit to state any material fact
            necessary to make the statements herein or therein, in light of the
            circumstances under which they were made, not misleading. All
            written information furnished after the date hereof by or on behalf
            of each of NCCC, NCMC and Guarantor to Buyer in connection with this
            Agreement and the other Repurchase Documents and the transactions
            contemplated hereby (other than with respect to the Mortgage Loans)
            and thereby

                                      -37-
<PAGE>

            will be true, complete and accurate in every material respect, or
            (in the case of projections) based on reasonable estimates, on the
            date as of which such information is stated or certified. There is
            no fact known to a Responsible Officer of either NCCC or NCMC, after
            due inquiry, that could reasonably be expected to have a Material
            Adverse Effect that has not been disclosed herein, in the other
            Repurchase Documents or in a report, financial statement, exhibit,
            schedule, disclosure letter or other writing furnished to Buyer for
            use in connection with the transactions contemplated hereby or
            thereby.

      (v)   ERISA. NCCC, NCMC, Guarantor and any of their respective ERISA
            Affiliates are not and will not be in the future, required to
            contribute to any Plan (including Multiemployer Plans) subject to
            the applicable provisions of ERISA.

      (w)   WORTH PURCHASE AGREEMENT. Each Eligible Asset sold by Seller to
            Buyer, which was originated by Worth Funding Incorporated, was
            purchased by Seller pursuant to the Worth Purchase Agreement.

11.   COVENANTS OF SELLER

      On and as of the date of this Agreement and each Purchase Date and until
      this Agreement is no longer in force with respect to any Transaction, each
      of NCCC and NCMC covenants that it will:

      (a)   FINANCIAL STATEMENTS. Seller shall deliver to Buyer:

            (1)   as soon as available and in any event within thirty (30)
                  calendar days after the end of each calendar month, the
                  unaudited consolidated balance sheets of Guarantor, Seller and
                  their consolidated Subsidiaries as at the end of such period
                  and the related unaudited consolidated statements of income
                  and retained earnings and of cash flows for Guarantor, Seller
                  and their consolidated Subsidiaries for such period and the
                  portion of the fiscal year through the end of such period,
                  accompanied by a certificate of a Responsible Officer of
                  Guarantor and Seller, as applicable, which certificate shall
                  state that said consolidated financial statements fairly
                  present in all material respects the consolidated financial
                  condition and results of operations of Guarantor or Seller and
                  its consolidated Subsidiaries, as applicable, in accordance
                  with GAAP, consistently applied, as at the end of, and for,
                  such period (subject to normal year-end adjustments);

            (2)   as soon as available and in any event within ninety (90) days
                  after the end of each fiscal year of Guarantor or Seller, the
                  consolidated balance sheets of Guarantor and Seller and their
                  respective consolidated Subsidiaries as at the end of such
                  fiscal year and the related consolidated statements of income
                  and retained earnings and of cash flows for Guarantor and
                  Seller and their respective consolidated Subsidiaries for such
                  year, setting forth in each case in comparative form the
                  figures for the previous year,

                                      -38-
<PAGE>

                  accompanied by an opinion thereon of independent certified
                  public accountants of recognized national standing, which
                  opinion shall not be qualified as to scope of audit or going
                  concern and shall state that said consolidated financial
                  statements fairly present the consolidated financial condition
                  and results of operations of Guarantor and Seller and their
                  respective consolidated Subsidiaries as at the end of, and
                  for, such fiscal year in accordance with GAAP, and a
                  certificate of such accountants stating that, in making the
                  examination necessary for their opinion, they obtained no
                  knowledge, except as specifically stated, of any Default or
                  Event of Default;

            (3)   prior to the end of each fiscal year, final annual budgets,
                  forecasts and pro-forma cash flow projections developed by
                  Guarantor, NCMC and NCCC for their next succeeding fiscal
                  year;

            (4)   as soon as available and in any event within thirty (30) days
                  after the end of each fiscal quarter of Seller, management
                  reports containing such information with respect to each
                  Junior Securitization Interest owned by any of NCCC, NCMC or
                  their respective Affiliates, and the related Company
                  Securitization Transaction, as Buyer may request, including,
                  without limitation, information concerning reserve account
                  balances, cash receipts, prepayment and credit loss
                  experience, REO Property inventory status and loss
                  projections, and relevant gain on sale assumptions;

            (5)   from time to time such other information regarding the
                  financial condition, operations, or business of Seller as
                  Buyer may reasonably request; and

            (6)   as soon as available and in any event within thirty (30)
                  calendar days after the end of each calendar month, the
                  balance sheet and statement of profits and losses as at the
                  end of such period for Worth Funding Incorporated.

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

      (b)   LITIGATION. Seller will promptly, and in any event within ten (10)
            days after service of process on any of the following, give to Buyer
            notice of all litigation, actions, suits, arbitrations,
            investigations (including, without limitation, any of the foregoing
            which are threatened or pending) or other legal or arbitrable
            proceedings affecting Seller or any of its Subsidiaries or affecting
            any of the

                                      -39-
<PAGE>

            Property of any of them before any Governmental Authority that (i)
            questions or challenges the validity or enforceability of any of the
            Repurchase Documents or any action to be taken in connection with
            the transactions contemplated hereby, (ii) makes a claim or claims
            in an aggregate amount greater than $500,000, or (iii) which,
            individually or in the aggregate, if adversely determined, could be
            reasonably likely to have a Material Adverse Effect.

      (c)   EXISTENCE, ETC. Each of NCCC and NCMC will:

            (1)   preserve and maintain its legal existence and all of its
                  material rights, privileges, licenses and franchises necessary
                  for the operation of its business (provided that nothing in
                  this Section 11(c)(1) shall prohibit any transaction expressly
                  permitted under Section 11(d));

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

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

            (4)   not move its chief executive office from the address referred
                  to in Section 10(p) or change its jurisdiction of organization
                  unless it shall have provided Buyer thirty (30) days' prior
                  written notice of such change;

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

            (6)   permit representatives of Buyer, upon reasonable notice
                  (unless a Default shall have occurred and is continuing, in
                  which case, no prior notice shall be required), during normal
                  business hours, to examine, copy and make extracts from its
                  books and records, to inspect any of its Properties, and to
                  discuss its business and affairs with its officers, all to the
                  extent reasonably requested by Buyer.

      (d)   RESTRICTION ON FUNDAMENTAL CHANGES. Guarantor, NCCC and NCMC will
            not, and will not permit any of their Subsidiaries to, engage in any
            business activities or operations substantially different from or
            unrelated to those in which Guarantor, NCCC and NCMC were engaged on
            the Effective Date, enter into any transaction of merger or
            consolidation, or liquidate, wind up or dissolve itself (or suffer
            any liquidation or dissolution), or convey, sell, lease, transfer or
            otherwise dispose of, in one transaction or a series of
            transactions, any of its assets, whether now owned

                                      -40-
<PAGE>

            or hereafter acquired, or acquire by purchase or otherwise all or
            substantially all the business or Property of, or stock or other
            evidence of beneficial ownership of, any Person, except:

            (1)   Guarantor, NCCC or NCMC may sell or otherwise dispose of
                  property in the ordinary course of business, provided such
                  sales do not include all or substantially all of the assets of
                  Guarantor, NCCC or NCMC;

            (2)   Guarantor and its Subsidiaries other than Seller may engage in
                  any business involving the origination, acquisition, servicing
                  or sale of consumer Indebtedness; and

            (3)   the Seller may transfer assets with a book value not to exceed
                  $6,000,000 at any time to REO Sub, provided that Buyer's
                  interest has been released in such assets in accordance
                  herewith.

      (e)   MARGIN DEFICIT. If at any time there exists a Margin Deficit, Seller
            shall cure same in accordance with Section 4.

      (f)   NOTICES. Seller shall give notice to Buyer:

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

            (2)   with respect to any Purchased Asset, promptly upon receipt of
                  any principal prepayment (in full or partial) of such
                  Purchased Asset;

            (3)   with respect to any Purchased Asset hereunder, promptly upon
                  receipt of notice or knowledge that the underlying Mortgaged
                  Property has been damaged by waste, fire, earthquake or earth
                  movement, flood, tornado or other casualty, or otherwise
                  damaged so as to affect adversely the Asset Value of such
                  Purchased Asset (provided that Seller may satisfy its
                  obligations under this clause (3) by causing Servicer to
                  notify Buyer of any such damage);

            (4)   promptly upon receipt of notice or knowledge of (i) any
                  material default related to any Purchased Item, (ii) any Lien
                  or security interest on, or claim asserted against, any
                  Purchased Item or (iii) any event or change in circumstances
                  which could reasonably be expected to have a Material Adverse
                  Effect;

            (5)   promptly upon any material change in the market value of any
                  or all of Seller's assets which could reasonably be expected
                  to have a Material Adverse Effect;

            (6)   no later than five Business Days after the end of each such
                  month, of all amounts borrowed under the Existing Financing
                  Facilities during such month, in the form of a daily
                  tabulation of all such amounts borrowed;

                                      -41-
<PAGE>

            (7)   upon any material amendment to the Existing Financing
                  Facilities, any decrease in the gross amount available to be
                  borrowed thereunder, or any change in custodian or custodial
                  arrangements relating thereto; and

            (8)   promptly upon the occurrence of any default or event of
                  default under the Existing Financing Facilities.

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

      (g)   REPORTS. Seller shall provide Buyer with a quarterly report, which
            report shall include, among other items, a summary of such Seller's
            delinquency and loss experience with respect to Mortgage Loans
            serviced by Seller, any Servicer or any designee of either,
            operating statements and the occupancy status of such Mortgaged
            Property and other property level information, plus any such
            additional reports as Buyer may reasonably request with respect to
            Seller or any Servicer's servicing portfolio or pending originations
            of Mortgage Loans.

      (h)   UNDERWRITING GUIDELINES. All Eligible Assets will conform with, and
            will be assigned a Risk Rating in accordance with, the Underwriting
            Guidelines. Seller shall not make any material change in the
            Underwriting Guidelines without the prior consent of Buyer and shall
            review the Underwriting Guidelines periodically to confirm that they
            are being complied with in all material respects and are adequate to
            meet Seller's business objectives. In the event Seller makes any
            material amendment or modification to the Underwriting Guidelines,
            Seller shall promptly deliver to Buyer a complete copy of the
            amended or modified Underwriting Guidelines. Seller shall deliver to
            Buyer a complete copy of the then-current Underwriting Guidelines
            (i) on the 1st day of each Test Period and (ii) promptly upon
            Buyer's request.

      (i)   AFFILIATE TRANSACTIONS. Guarantor, NCCC and NCMC will not, and will
            not permit any of their Subsidiaries to, enter into any transaction
            with an Affiliate of Guarantor, NCCC or NCMC, except: (a)
            transactions in the ordinary course of business on terms no less
            favorable to Guarantor, NCCC or NCMC than those that would be
            obtained in an arm's-length transaction; (b) Indebtedness described
            in Sections 11(s)(5) and 11(s)(10); (c) guaranties of Indebtedness
            described in Section 11(k); (d) transfers of assets by NCMC to NCCC
            and REO Sub as described in Sections 11(k)(3) and 11(k)(4); and (e)
            transfers by NCCC and NCCC of Junior Securitization Interests to
            Residual Finance Subsidiaries. In no event shall Seller transfer to
            Buyer hereunder any Mortgage Loan acquired by Seller from an
            Affiliate of Seller (other than each other Seller or Worth Funding
            Incorporated) unless a True Sale Certification has been delivered to
            Buyer prior to such sale.

      (j)   LIENS. Guarantor, NCCC and NCMC will not, and will not permit any of
            their Subsidiaries to, directly or indirectly, create, incur, assume
            or permit to exist any

                                      -42-
<PAGE>

            Lien with respect to any property now owned or hereafter acquired by
            Guarantor, NCCC or NCMC, or any income or profits therefrom, except:

            (1)   [Reserved];

            (2)   Liens in connection with deposits or pledges to secure payment
                  of workers' compensation, unemployment insurance, old age
                  pensions or other social security obligations, in the ordinary
                  course of business of Guarantor, NCCC or NCMC;

            (3)   Liens for taxes, fees, assessments and governmental charges
                  not delinquent or which are being contested in good faith by
                  appropriate proceedings and for which appropriate reserves
                  have been established in accordance with GAAP;

            (4)   encumbrances consisting of zoning regulations, easements,
                  rights of way, survey exceptions and other similar
                  restrictions on the use of real property and minor
                  irregularities in title thereto which do not materially impair
                  their use in the operation of its business;

            (5)   Liens on equipment arising under any capitalized lease
                  obligation or other purchase money Liens on equipment acquired
                  after the Effective Date to secure Indebtedness permitted
                  pursuant to Section 11(s)(3);

            (6)   Liens incurred in connection with gestation repurchase
                  agreements or similar arrangements, including, without
                  limitation, (i) arrangements under which Guarantor or its
                  Subsidiaries are required to repurchase Mortgage-backed
                  Securities or Mortgage Loans from any lender or other
                  counterparty reasonably satisfactory to Buyer, or (ii) credit
                  facilities structured as loan and security agreements;
                  provided, that such gestation repurchase agreements or similar
                  arrangements are entered into in the ordinary course of
                  business in contemplation of the subsequent non-recourse sale
                  of such Mortgage-backed Securities or Mortgage Loans,
                  including without limitation, liens granted under the Existing
                  Financing Facilities;

            (7)   Liens on Junior Securitization Interests which secure
                  Indebtedness permitted by Section 11(s)(4);

            (8)   Liens arising under Interest Rate Protection Agreements;

            (9)   a pledge of the stock of REO Sub to SBRC pursuant to the
                  Salomon REO Financing Facility; and

            (10)  a pledge of the stock of NC Residual II Corporation to
                  Financial Securities Assurance Corporation.

                                      -43-
<PAGE>

      (k)   GUARANTEES. Guarantor, NCCC and NCMC will not, and will not permit
            any of their Subsidiaries to, directly or indirectly, create or
            become or be liable with respect to any Guarantee, other than:

            (1)   the Guarantee pursuant to the USB Financing Facility;

            (2)   Guarantees by Guarantor of Indebtedness of NCMC OR NCCC
                  secured by liens described in Section 11(j)(5), in an amount
                  not to exceed $7,500,000;

            (3)   Guarantees by Guarantor of NCMC's or NCCC's obligations
                  relating to (i) Indebtedness permitted by Sections 11(s)(4)
                  and 11(s)(7) or (ii) the Strategic Alliance Agreement (as
                  defined below) described in Section 11(t)(10);

            (4)   Guarantees by NCMC of the obligations of NCCC or Residual
                  Finance Subsidiaries in respect of Indebtedness permitted by
                  Sections 11(s)(4) and 11(s)(7); and

            (5)   the Guaranty.

      (l)   LIMITATION ON DISTRIBUTIONS. After the occurrence and during the
            continuation of any Default, neither NCCC nor NCMC shall make any
            payment on account of, or set apart assets for, a sinking or other
            analogous fund for the purchase, redemption, defeasance, retirement
            or other acquisition of any equity or partnership interest of NCCC
            or NCMC, as applicable, whether now or hereafter outstanding, or
            make any other distribution in respect thereof, either directly or
            indirectly, whether in cash or property or in obligations of NCCC or
            NCMC, as applicable.

      (m)   NET WORTH. Guarantor will at all times during each fiscal year
            maintain Tangible Net Worth of not less than (a) the greater of (i)
            $130,000,000 or (ii) eighty-five percent (85%) of the Tangible Net
            Worth at the end of its most recently completed fiscal year (or, in
            the case of the Tangible Net Worth at the end of any fiscal year,
            its prior fiscal year) plus (b) ninety percent (90%) of capital
            contributions made during such fiscal year plus (c) fifty percent
            (50%) of positive year-to-date net income. NCMC will at all times
            during each fiscal year maintain Tangible Net Worth of not less than
            (a) the greater of (i) $85,000,000 or (ii) eighty-five percent (85%)
            of the Tangible Net Worth at the end of its most recently completed
            fiscal year (or, in the case of the Tangible Net Worth at the end of
            any fiscal year, its prior fiscal year) plus (b) ninety percent
            (90%) of capital contributions made during such fiscal year plus (c)
            fifty percent (50%) of positive year-to-date net income. NCCC will
            at all times during each fiscal year maintain Tangible Net Worth of
            not less than $1.00.

      (n)   MINIMUM LIQUIDITY. Seller will not permit the sum of (a) Cash of the
            Guarantor plus (b) the lesser of the Borrowing Base (as defined
            therein) of the USB Financing Facility and the Commitment Amounts
            (as defined therein) of the USB

                                      -44-
<PAGE>

            Financing Facility minus, in either case, the outstanding principal
            balance of all Loans thereunder (as defined therein), plus (c) the
            lesser of eighty percent (80%) of the receivables related to the
            sale or transfer of NCMC's or NCCC's interest in any Servicing
            Contract, or $5,000,000, to (i) be less than $10,000,000 as of the
            end of any month or (ii) remain less than $10,000,000 for more than
            ten (10) calendar days after giving effect to any mandatory
            prepayment of principal (or the equivalent) under any Residual
            Financing Agreement.

      (o)   LEVERAGE RATIO. Guarantor will not permit (i) the Quarterly Average
            Leverage Ratio for any period of measurement to be greater than 10.0
            to 1.0, (ii) the Daily Leverage Ratio on any date to be greater than
            15.0 to 1.0, or (iii) the Adjusted Leverage Ratio as of the last day
            of each fiscal quarter to be greater than 12.0 to 1.0. NCMC will not
            permit the Leverage Ratio of NCMC to be greater than 8.0 to 1.0 as
            of the last day of each fiscal quarter of NCMC.

      (p)   SERVICER; SERVICING TAPE. Seller shall provide to Buyer, via
            Electronic Transmission, a remittance report on a monthly basis by
            no later than the 12th day of each month (the "REPORTING DATE")
            containing servicing information, including without limitation those
            fields reasonably requested by Buyer from time to time, on a
            loan-by-loan basis and in the aggregate, with respect to the
            Purchased Mortgage Loans serviced hereunder by Seller or any
            Servicer for the month (or any portion thereof) prior to the
            Reporting Date (such remittance report, an "ASSET TAPE"). Seller
            shall not cause the Mortgage Loans to be serviced by any servicer
            other than a servicer expressly approved in writing by Buyer, which
            approval shall be deemed granted by Buyer with respect to Seller
            with the execution of this Agreement.

      (q)   REQUIRED FILINGS. Seller shall promptly provide Buyer with copies of
            all documents which NCCC, NCMC or any Subsidiary of NCCC or NCMC is
            required to file with the Office of the Comptroller of Currency in
            accordance with its regulations.

      (r)   REMITTANCE OF PREPAYMENTS. Seller shall remit or cause to be
            remitted to Buyer, with sufficient detail via Electronic
            Transmission to enable Buyer to appropriately identify the Mortgage
            Loan to which any amount remitted applies, all full or partial
            principal prepayments on any Purchased Asset that Seller has
            received on a weekly basis, to be paid on Thursday of the next
            succeeding week (or the next Business Day).

      (s)   INDEBTEDNESS. Guarantor, NCCC and NCMC will not, and will not permit
            any of their Subsidiaries to, directly or indirectly, create, incur,
            assume, guarantee, or otherwise become or remain directly or
            indirectly liable with respect to, any Indebtedness, except:

            (1)   The obligations of Seller hereunder and Guarantor under the
                  Guaranty;

                                      -45-
<PAGE>

            (2)   current liabilities not more than ninety (90) days overdue,
                  unless contested in good faith by appropriate proceedings and
                  any reserves required by GAAP have been established, incurred
                  by Guarantor, NCMC or NCCC in the ordinary course of business
                  otherwise than for money borrowed;

            (3)   Indebtedness incurred to finance the purchase of equipment and
                  secured solely by Liens on such equipment, in an aggregate
                  amount not to exceed $10,000,000;

            (4)   Indebtedness incurred to finance all Junior Securitization
                  Interests which Indebtedness is secured only by Junior
                  Securitization Interests, provided, that such Indebtedness
                  does not exceed 50% of the aggregate value of all Junior
                  Securitization Interests determined in accordance with GAAP;

            (5)   intercompany Indebtedness of Guarantor to NCCC or NCMC in an
                  aggregate amount not to exceed $1,000,000;

            (6)   intercompany Indebtedness of NCCC or NCMC to Guarantor
                  incurred in the ordinary course of business;

            (7)   obligations under gestation repurchase agreements or similar
                  arrangements of the type described in Section 11(j)(6);

            (8)   Subordinated Debt;

            (9)   Indebtedness incurred by NCCC or NCMC in connection with the
                  Salomon REO Financing Facility in an aggregate amount not to
                  exceed $3,000,000; and

            (10)  intercompany Indebtedness between NCMC and NCCC incurred in
                  the ordinary course of business.

      (t)   INVESTMENTS. Guarantor, NCMC and NCCC will not, and will not permit
            any of their Subsidiaries to, directly or indirectly, make or own
            any Investment, except Investments in:

            (1)   marketable direct obligations issued or unconditionally
                  guaranteed by the United States Government or issued by any
                  agency thereof and backed by the full faith and credit of the
                  United States, in each case maturing within one year from the
                  date of acquisition thereof;

            (2)   marketable direct obligations issued by any state of the
                  United States of America or any political subdivision of any
                  such state or any public instrumentality thereof maturing
                  within one year from the date of acquisition thereof and, at
                  the time of acquisition, having the highest rating obtainable
                  from either Standard & Poor's Ratings Group, a division of
                  McGraw Hill, Inc., or Moody's Investors Service, Inc.;

                                      -46-
<PAGE>

            (3)   commercial paper maturing no more than one year from the date
                  of creation thereof and, at the time of acquisition, having
                  the highest rating obtainable from either Standard & Poor's
                  Ratings Group, a division of McGraw Hill, Inc., or Moody's
                  Investors Service, Inc.;

            (4)   in the case of Guarantor, other consumer debt obligations
                  originated or acquired by Guarantor in the ordinary course of
                  Guarantor's business, in the case of NCMC, Mortgage Loans
                  originated or acquired by NCMC in the ordinary course of
                  NCMC's business, and in the case of NCCC, Mortgage Loans
                  acquired from NCMC in the ordinary course of NCCC's business;

            (5)   certificates of deposits or bankers acceptances issued by
                  Buyer or any other commercial bank organized under the laws of
                  the United States or any State thereof and having a combined
                  capital and surplus of at least $500,000,000, or by United
                  States offices of foreign banks having the highest rating
                  obtainable from a nationally recognized rating agency, in each
                  case maturing within one year from the date of acquisition
                  thereof;

            (6)   Investments in mutual funds that invest substantially all of
                  their assets in Investments of the types described in
                  subsections (1), (2), (3) and (5) of this Section 11(t);

            (7)   the capital stock of any Subsidiary (subject to the
                  limitations set forth in Sections 11(d) and 11(u);

            (8)   in the case of NCMC and NCCC, loans to Guarantor in an
                  aggregate amount not to exceed $1,000,000;

            (9)   direct equity investments made by either NCMC or NCCC, to the
                  extent no Event of Default or Default has occurred and is
                  continuing, or would occur as a result thereof, in or loans to
                  Persons in the mortgage origination business, in an aggregate
                  amount not to exceed $2,500,000;

            (10)  Investments made or to be made by NCMC, in an amount not to
                  exceed $1,250,000 in the aggregate, and a guaranty made by
                  Guarantor, pursuant to a Strategic Alliance Agreement (the
                  "STRATEGIC ALLIANCE AGREEMENT") by and among NCMC, Qualified
                  Financial Services, Inc., a Colorado corporation, Qualified
                  Financial Services, Inc., a California corporation, Simon
                  Mundy, an individual, and David V.V. Thais, an individual;

            (11)  Investments arising under Interest Rate Protection Agreements;

            (12)  in the case of Guarantor, loans to NCMC and NCCC; and

            (13)  intercompany Indebtedness between NCMC and NCCC incurred in
                  the ordinary course of business.

                                      -47-
<PAGE>

      (u)   SUBSIDIARIES. (a) Guarantor will not create or acquire any
            Subsidiaries other than (i) NCCC and NCMC, (ii) the Subsidiaries
            listed on Schedule 2 hereto, (iii) Residual Finance Subsidiaries,
            and (iv) Subsidiaries engaged solely in any business involving the
            origination, acquisition, servicing and sale of consumer
            obligations, and (b) Seller will not create or acquire any
            Subsidiaries other than (i) the Subsidiaries listed on Schedule 2
            hereto, (ii) Residual Finance Subsidiaries, and (iii) Subsidiaries
            acquired as a result of Investments permitted pursuant to Section
            11(t)(10).

      (v)   RESTRICTED PAYMENTS. Guarantor, NCCC and NCMC will not make any
            Restricted Payments, other than (a) dividends paid by Guarantor on
            its Series 1998A Convertible Preferred Stock and its Series 1999A
            Convertible Preferred Stock in an aggregate amount not to exceed
            $3,000,000 per annum, and (b) dividends paid by NCMC to Guarantor to
            enable Guarantor to pay such dividends in an amount not to exceed
            $3,000,000 per annum; provided, that in each case both before and
            after giving effect to such dividends, Guarantor, NCCC and NCMC are
            in compliance with the covenants set forth in Section 11 of this
            Agreement and no Event of Default or Default has occurred and is
            continuing.

      (w)   CUSTODIAL AGREEMENT AND ACCOUNT AGREEMENT. Seller shall maintain
            each of the Custodial Agreement and Account Agreement in full force
            and effect and shall not amend or modify either of the Custodial
            Agreement or the Account Agreement or waive compliance with any
            provisions thereunder without the prior written consent of Buyer.

      (x)   INCONSISTENT AGREEMENTS. Guarantor, NCMC and NCCC will not, and will
            not permit any of their Subsidiaries to, directly or indirectly,
            enter into any agreement containing any provision which would be
            violated or breached by any Transaction hereunder or by the
            performance by either of Guarantor, NCCC or NCMC of their respective
            obligations under any Repurchase Document to which it is a party.

      (y)   COMPLIANCE REPORT. Seller shall provide Buyer no later than the 30th
            day of each month, in a letter format acceptable to Buyer in its
            sole discretion, a compliance report demonstrating therein the
            calculations Seller utilized to determine its compliance with the
            financial covenants set forth in clauses (m), (n) and (o) of this
            Section 11 as of the end of the immediately preceding month.

      (z)   SUB-LIMITS. Seller shall not sell to Buyer any Eligible Assets if,
            after giving effect to such Transaction, the aggregate principal
            balance of such Purchased Assets are in excess of any applicable
            Sub-Limit.

      (aa)  ESCROW IMBALANCES. Seller will, no later than five (5) Business Days
            after learning (from any source) of any material imbalance in any
            escrow account, fully and completely correct and eliminate such
            imbalance including, without limitation, depositing its own funds
            into such account to eliminate any overdrawal or deficit.

                                      -48-
<PAGE>

      (bb)  INDEPENDENCE OF COVENANTS. All covenants hereunder shall be given
            independent effect so that if a particular action or condition is
            not permitted by any of such covenants, the fact that it would be
            permitted by an exception to, or be otherwise within the limitations
            of, another covenant shall not avoid the occurrence of an Event of
            Default or Default if such action is taken or condition exists.

12.   EVENTS OF DEFAULT

      If any of the following events (each an "EVENT OF DEFAULT") occur, Seller
      and Buyer shall have the rights set forth in Section 13, as applicable:

      (a)   Seller shall default in the payment of any Repurchase Price due or
            any amount under Section 5 when due (whether at stated maturity,
            upon acceleration or at mandatory or optional prepayment); or

      (b)   Seller shall default in the payment of any other amount payable by
            it hereunder or under any other Repurchase Document after
            notification by Buyer of such default, and such default shall have
            continued unremedied for one (1) Business Day; or

      (c)   any representation, warranty or certification made or deemed made
            herein or in any other Repurchase Document by Seller or any
            certificate furnished to Buyer pursuant to the provisions hereof or
            thereof or any information with respect to the Mortgage Loans
            furnished in writing by on behalf of Seller shall prove to have been
            false or misleading in any material respect as of the time made or
            furnished (other than the representations and warranties set forth
            in SCHEDULE 1, which shall be considered solely for the purpose of
            determining the Asset Value of the Purchased Assets, unless (i)
            Seller shall have made any such representations and warranties with
            actual knowledge that they were materially false or misleading at
            the time made; or (ii) any such representations and warranties have
            been determined in good faith by Buyer in its sole discretion to be
            materially false or misleading on a regular basis); or

      (d)   Seller shall fail to comply with the requirements of 11(c), Section
            11(d), Section 11(e), Section 11(f), Section 11(h) (with respect to
            the Eligible Assets as a whole and not with respect to any single
            Eligible Asset) or Sections 11(i) through 11(w); and such default
            shall continue unremedied for a period of 5 Business Days from the
            earlier of (i) a responsible officer of Seller having knowledge of
            such default and (ii) Buyer giving notice to Seller of such default;
            or except as otherwise set forth in Sections 12(a), 12(b), 12(c) and
            12(d), Seller shall fail to observe or perform any other covenant or
            agreement contained in this Agreement or any other Repurchase
            Document and such failure to observe or perform shall continue
            unremedied for a period of 10 Business Days from the earlier of (i)
            a responsible officer of Seller having knowledge of such default and
            (ii) Buyer giving notice to Seller of such default; or

      (e)   a final judgment or judgments for the payment of money in excess of
            $500,000 in the aggregate shall be rendered against NCCC, NCMC or
            any of their Affiliates

                                      -49-
<PAGE>

            by one or more courts, administrative tribunals or other bodies
            having jurisdiction and the same shall not be satisfied, discharged
            (or provision shall not be made for such discharge) or bonded, or a
            stay of execution thereof shall not be procured, within 30 days from
            the date of entry thereof; or

      (f)   an Act of Insolvency shall have occurred with respect to NCCC, NCMC
            or any of their Affiliates; or

      (g)   the Custodial Agreement, the Account Agreement or any Repurchase
            Document shall for whatever reason be terminated or cease to be in
            full force and effect, or the enforceability thereof shall be
            contested by NCCC or NCMC; or

      (h)   NCCC or NCMC shall grant, or suffer to exist, any Lien on any
            Purchased Item (except any Lien in favor of Buyer); or either the
            Purchased Items shall not have been sold to Buyer, or the Liens
            contemplated hereby shall cease or fail to be first priority
            perfected Liens on any Purchased Items (but not the related
            Mortgaged Properties) in favor of Buyer or shall be Liens in favor
            of any Person other than Buyer; or

      (i)   NCCC, NCMC or any of their Affiliates shall be in default under (i)
            any Indebtedness in an amount equal to $250,000 or more of NCCC or
            NCMC or of such Affiliate which default (1) involves the failure to
            pay a matured obligation, or (2) permits the acceleration of the
            maturity of obligations by any other party to or beneficiary with
            respect to such Indebtedness, (ii) any other contract to which NCCC
            or NCMC or such Affiliate is a party which default (1) involves the
            failure to pay a matured obligation in excess of $250,000, or (2)
            permits the acceleration of the maturity of obligations in excess of
            $250,000 by any other party to or beneficiary of such contract, or
            (iii) any Seller-Related Obligation; or

      (j)   any material adverse change in the Property, business or financial
            condition of NCCC or NCMC or any of their Affiliates shall occur, in
            each case as determined by Buyer in its sole good faith discretion,
            or any other condition shall exist which, in Buyer's sole good faith
            discretion, constitutes a material impairment of Seller's ability to
            perform its obligations under this Agreement or any other Repurchase
            Document; or

      (k)   the Initial Funding does not occur on or prior to August 1, 2001; or

      (l)   upon (i) any material adverse change in the terms of or (ii)
            material reduction in amounts available to NCCC, NCMC or their
            Affiliates under any of the Existing Financing Facilities; or

      (m)   upon any event of default or event which, with the passage of time
            or expiration of any grace periods, would constitute an event of
            default under any of the Existing Financing Facilities; or

      (n)   a Change of Control shall have occurred; or

                                      -50-
<PAGE>

      (o)   Seller shall not complete the Required Secondary Amendments within
            sixty (60) days of the date hereof; or

      (p)   Seller shall not complete the Required Amendments within thirty (30)
            days of the date hereof.

13.   REMEDIES

      (a)   If an Event of Default occurs, the following rights and remedies are
            available to Buyer; provided, that an Event of Default shall be
            deemed to be continuing unless expressly waived by Buyer in writing.

            (1)   At the option of Buyer, exercised by written notice to Seller
                  (which option shall be deemed to have been exercised, even if
                  no notice is given, immediately upon the occurrence of an Act
                  of Insolvency of Seller), the Repurchase Date for each
                  Transaction hereunder, if it has not already occurred, shall
                  be deemed immediately to occur. Buyer shall (except upon the
                  occurrence of an Act of Insolvency of Seller) give notice to
                  Seller of the exercise of such option as promptly as
                  practicable.

            (2)   If Buyer exercises or is deemed to have exercised the option
                  referred to in subsection (a)(1) of this Section,

                        (A) Seller's obligations in such Transactions to
                  repurchase all Purchased Assets, at the Repurchase Price
                  therefor on the Repurchase Date, (1) shall thereupon become
                  immediately due and payable, (2) all Income paid after such
                  exercise or deemed exercise shall be retained by Buyer and
                  applied to the aggregate unpaid Repurchase Prices and any
                  other amounts owed by Seller hereunder, and (3) Seller shall
                  immediately deliver to Buyer any Purchased Assets subject to
                  such Transactions then in NCCC's or NCMC's possession or
                  control;

                        (B) to the extent permitted by applicable law, the
                  Repurchase Price with respect to each such Transaction shall
                  be increased by the aggregate amount obtained by daily
                  application of, on a 360 day per year basis for the actual
                  number of days during the period from and including the date
                  of the exercise or deemed exercise of such option to but
                  excluding the date of payment of the Repurchase Price, (x) the
                  Post-Default Rate to (y) the Repurchase Price for such
                  Transaction as of the Repurchase Date (decreased as of any day
                  by (i) any amounts actually in the possession of Buyer
                  pursuant to clause (C) of this subsection, (ii) any proceeds
                  from the sale of Purchased Assets applied to the Repurchase
                  Price pursuant to subsection (a)(4) of this Section, and (iii)
                  any amounts applied to the Repurchase Price pursuant to
                  subsection (a)(4) of this Section); and

                        (C) all Income actually received by Buyer pursuant to
                  Section 5 (excluding any Late Payment Fees paid pursuant to
                  Section 5(b)) shall be applied to the aggregate unpaid
                  Repurchase Price owed by Seller.

                                      -51-
<PAGE>

            (3)   Upon the occurrence of one or more Events of Default, Buyer
                  shall have the right to obtain physical possession of the
                  Servicing Records (subject to the provisions of the Custodial
                  Agreement) and all other files of Seller relating to the
                  Purchased Assets and all documents relating to the Purchased
                  Assets which are then or may thereafter come in to the
                  possession of Seller or any third party acting for Seller and
                  Seller shall deliver to Buyer such assignments as Buyer shall
                  request and Buyer shall have the right to appoint any Person
                  to act as Servicer for the Purchased Assets. Buyer shall be
                  entitled to specific performance of all agreements of Seller
                  contained in the Repurchase Documents.

            (4)   At any time on the Business Day following notice to Seller
                  (which notice may be the notice given under subsection (a)(1)
                  of this Section), in the event Seller has not repurchased all
                  Purchased Assets, Buyer may (A) immediately sell, without
                  demand or further notice of any kind, at a public or private
                  sale and at such price or prices as Buyer may deem
                  satisfactory any or all Purchased Assets subject to such
                  Transactions hereunder and apply the proceeds thereof to the
                  aggregate unpaid Repurchase Price and any other amounts owing
                  by Seller hereunder or (B) in its sole discretion elect, in
                  lieu of selling all or a portion of such Purchased Assets, to
                  give Seller credit for such Purchased Assets in an amount
                  equal to the Market Value of the Purchased Assets against the
                  aggregate unpaid Repurchase Price and any other amounts owing
                  by Seller hereunder. The proceeds of any disposition of
                  Purchased Assets shall be applied first to the costs and
                  expenses incurred by Buyer in connection with Seller's
                  default; second to costs of relating covering and/or related
                  hedging transactions; third to the Repurchase Price; and
                  fourth to any other outstanding obligation of Seller to Buyer
                  or its Affiliates.

            (5)   Seller agrees that Buyer may obtain an injunction or an order
                  of specific performance to compel Seller to fulfill its
                  obligations as set forth in Section 24, if Seller fails or
                  refuses to perform its obligations as set forth therein.

            (6)   Seller shall be liable to Buyer, payable as and when incurred
                  by Buyer, for (A) the amount of all actual out-of-pocket
                  expenses, including legal or other expenses incurred by Buyer
                  in connection with or as a consequence of an Event of Default,
                  and (B) all costs incurred in connection with hedging or
                  covering transactions.

            (7)   Buyer shall have, in addition to its rights hereunder, any
                  rights otherwise available to it under any other agreement or
                  applicable law.

      (b)   Buyer may exercise one or more of the remedies available to Buyer
            immediately upon the occurrence of an Event of Default and, except
            to the extent provided in subsections (a)(1) and (4) of this
            Section, at any time thereafter without notice to Seller. All rights
            and remedies arising under this Agreement as amended from

                                      -52-
<PAGE>

            time to time hereunder are cumulative and not exclusive of any other
            rights or remedies which Buyer may have.

      (c)   Buyer may enforce its rights and remedies hereunder without prior
            judicial process or hearing, and Seller hereby expressly waives any
            defenses Seller might otherwise have to require Buyer to enforce its
            rights by judicial process. Seller also waives any defense (other
            than a defense of payment or performance) Seller might otherwise
            have arising from the use of nonjudicial process, enforcement and
            sale of all or any portion of the Purchased Items, or from any other
            election of remedies. Seller recognizes that nonjudicial remedies
            are consistent with the usages of the trade, are responsive to
            commercial necessity and are the result of a bargain at
            arm's-length.

      (d)   To the extent permitted by applicable law, Seller shall be liable to
            Buyer for interest on any amounts owing by Seller hereunder, from
            the date Seller becomes liable for such amounts hereunder until such
            amounts are (i) paid in full by Seller or (ii) satisfied in full by
            the exercise of Buyer's rights hereunder. Interest on any sum
            payable by Seller to Buyer under this paragraph 13(d) shall be at a
            rate equal to the Post-Default Rate.

14.   INDEMNIFICATION AND EXPENSES

      (a)   NCCC and NCMC, jointly and severally, agree to hold Buyer and its
            Affiliates and their present and former respective officers,
            directors, employees, agents, advisors and other representatives
            (each an "INDEMNIFIED PARTY") harmless from and indemnify any
            Indemnified Party against all liabilities, losses, damages,
            judgments, costs and expenses of any kind which may be imposed on,
            incurred by or asserted against such Indemnified Party (including
            counsel's fees and disbursements) (collectively, "COSTS"), relating
            to or arising out of this Agreement, any other Repurchase Document
            or any transaction contemplated hereby or thereby, or any amendment,
            supplement or modification of, or any waiver or consent under or in
            respect of, this Agreement, any other Repurchase Document or any
            transaction contemplated hereby or thereby, that, in each case,
            results from anything other than the Indemnified Party's gross
            negligence or willful misconduct. Without limiting the generality of
            the foregoing, each of NCCC and NCMC, jointly and severally, agrees
            to hold any Indemnified Party harmless from and indemnify such
            Indemnified Party against all Costs with respect to all Mortgage
            Loans relating to or arising out of any violation or alleged
            violation of any environmental law, rule or regulation or any
            consumer credit laws, including without limitation the federal Truth
            in Lending Act and/or the federal Real Estate Settlement Procedures
            Act, that, in each case, results from anything other than the
            Indemnified Party's gross negligence or willful misconduct. In any
            suit, proceeding or action brought by an Indemnified Party in
            connection with any Mortgage Loan for any sum owing thereunder, or
            to enforce any provisions of any Mortgage Loan, each of NCCC and
            NCMC, jointly and severally, will save, indemnify and hold such
            Indemnified Party harmless from and against all expense, loss or
            damage suffered by reason of any defense, set-off,

                                      -53-
<PAGE>

            counterclaim, recoupment or reduction or liability whatsoever of the
            account debtor or obligor thereunder, arising out of a breach by
            NCCC or NCMC of any obligation thereunder or arising out of any
            other agreement, indebtedness or liability at any time owing to or
            in favor of such account debtor or obligor or its successors from
            NCCC or NCMC. Each of NCCC and NCMC, jointly and severally, also
            agrees to reimburse an Indemnified Party as and when billed by such
            Indemnified Party for all the Indemnified Party's costs and expenses
            incurred in connection with the enforcement or the preservation of
            Buyer's rights under this Agreement, any other Repurchase Document
            or any transaction contemplated hereby or thereby, including without
            limitation the fees and disbursements of its counsel.

      (b)   Subject to the second succeeding sentence, Seller agrees to pay as
            and when billed by Buyer all of the out-of-pocket costs and expenses
            (including legal fees) incurred by Buyer in connection with the
            development, preparation and execution of, any other Repurchase
            Document or any other documents prepared in connection herewith (the
            "INITIAL COSTS"). Seller agrees to pay as and when billed by Buyer
            all of the out-of-pocket costs and expenses (including legal fees)
            incurred by Buyer in connection with any amendment, supplement or
            modification to, this Agreement or any other Repurchase Document or
            any other documents prepared in connection therewith. Seller agrees
            to pay as and when billed by Buyer all of the out-of-pocket costs
            and expenses incurred in connection with the consummation and
            administration of the transactions contemplated hereby and thereby
            including without limitation all fees, disbursements and expenses of
            counsel to Buyer which amount shall be deducted from the Purchase
            Price paid for the first Transaction hereunder; provided that such
            expenses, together with the Initial Costs, shall not exceed $65,000
            without the prior written consent of Seller which consent shall not
            be unreasonably withheld. Subject to the limitations set forth in
            Section 27, Seller agrees to pay Buyer all the out-of-pocket due
            diligence, inspection, testing and review costs and expenses
            incurred by Buyer with respect to Mortgage Loans submitted by Seller
            for purchase under this Agreement, including, but not limited to,
            those out of pocket costs and expenses incurred by Buyer pursuant to
            Sections 24 and 27.

15.   RECORDING OF COMMUNICATIONS

      Buyer and Seller shall have the right (but not the obligation) from time
      to time to make or cause to be made tape recordings of communications
      between its employees and those of the other party with respect to
      Transactions upon notice to the other party of such recording. Buyer and
      Seller consent to the admissibility of such tape recordings in any court,
      arbitration, or other proceedings. The parties agree that a duly
      authenticated transcript of such a tape recording shall be deemed to be a
      writing conclusively evidencing the parties' agreement.

                                      -54-
<PAGE>

16.   SINGLE AGREEMENT

      Buyer and Seller acknowledge that, and have entered hereinto and will
      enter into each Transaction hereunder in consideration of and in reliance
      upon the fact that, all Transactions hereunder constitute a single
      business and contractual relationship and that each has been entered into
      in consideration of the other Transactions. Accordingly, each of Buyer and
      Seller agrees (i) to perform all of its obligations in respect of each
      Transaction hereunder, and that a default in the performance of any such
      obligations shall constitute a default by it in respect of all
      Transactions hereunder, (ii) that each of them shall be entitled to set
      off claims and apply property held by them in respect of any Transaction
      against obligations owing to them in respect of any other Transaction
      hereunder; (iii) that payments, deliveries, and other transfers made by
      either of them in respect of any Transaction shall be deemed to have been
      made in consideration of payments, deliveries, and other transfers in
      respect of any other Transactions hereunder, and the obligations to make
      any such payments, deliveries, and other transfers may be applied against
      each other and netted and (iv) to promptly provide notice to the other
      after any such set off or application.

17.   NOTICES AND OTHER COMMUNICATIONS

      Except as otherwise expressly permitted by this Agreement, all notices,
      requests and other communications provided for herein and under the
      Custodial Agreement (including without limitation any modifications of, or
      waivers, requests or consents under, this Agreement) shall be given or
      made in writing (including without limitation by email, telex or telecopy)
      delivered to the intended recipient at the "Address for Notices" specified
      below its name on the signature pages hereof or thereof); or, as to any
      party, at such other address as shall be designated by such party in a
      written notice to each other party. Except as otherwise provided in this
      Agreement and except for notices given under Section 3 (which shall be
      effective only on receipt), all such communications shall be deemed to
      have been duly given when transmitted by telecopy or personally delivered
      or, in the case of a mailed notice, upon receipt.

18.   ENTIRE AGREEMENT; SEVERABILITY

      This Agreement together with the other Repurchase Documents constitute the
      entire understanding between Buyer and Seller with respect to the subject
      matter it covers and shall supersede any existing agreements between the
      parties containing general terms and conditions for repurchase
      transactions involving Purchased Assets. By acceptance of this Agreement,
      Buyer and Seller acknowledge that they have not made, and are not relying
      upon, any statements, representations, promises or undertakings not
      contained in this Agreement. Each provision and agreement herein shall be
      treated as separate and independent from any other provision or agreement
      herein and shall be enforceable notwithstanding the unenforceability of
      any such other provision or agreement.

                                      -55-
<PAGE>

19.   NON-ASSIGNABILITY

      The rights and obligations of the parties under this Agreement and under
      any Transaction shall not be assigned by NCCC or NCMC without the prior
      written consent of Buyer, and any attempted assignment without such
      consent shall be null and void. Subject to the foregoing, this Agreement
      and any Transactions shall be binding upon and shall inure to the benefit
      of the parties and their respective successors and assigns. Nothing in
      this Agreement express or implied, shall give to any person, other than
      the parties to this Agreement and their successors hereunder, any benefit
      of any legal or equitable right, power, remedy or claim under this
      Agreement.

20.   TERMINABILITY

      Except as set forth below, this Agreement may be terminated (a) by Seller
      upon giving written notice to Buyer and (b) by Buyer upon the occurrence
      of any event set forth in Section 3(b)(10) except that this Agreement
      shall, notwithstanding such notice, remain applicable to any Transaction
      then outstanding; provided that the Repurchase Date for any such
      Transaction outstanding shall be the earlier to occur of the original
      Repurchase Date pursuant to the applicable Confirmation and (ii) 20 days
      from the date of such notice of termination. Each representation and
      warranty made or deemed to be made by entering into a Transaction, herein
      or pursuant hereto shall survive the making of such representation and
      warranty, and Buyer shall not be deemed to have waived any Default that
      may arise because any such representation or warranty shall have proved to
      be false or misleading, notwithstanding that Buyer may have had notice or
      knowledge or reason to believe that such representation or warranty was
      false or misleading at the time the Transaction was made. Notwithstanding
      any such termination or the occurrence of an Event of Default, all of the
      representations and warranties and covenants hereunder shall continue and
      survive. The obligations of Seller under Section 14 shall survive the
      termination of this Agreement.

21.   GOVERNING LAW

      THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
      LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW
      PRINCIPLES.

22.   SUBMISSION TO JURISDICTION; WAIVERS

      EACH OF BUYER, NCCC AND NCMC HEREBY IRREVOCABLY AND UNCONDITIONALLY:

      (A) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING
      RELATING TO THIS AGREEMENT AND THE OTHER REPURCHASE DOCUMENTS, OR FOR
      RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE
      EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, THE
      FEDERAL COURTS OF THE UNITED STATES OF

                                      -56-
<PAGE>

      AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM
      ANY THEREOF;

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

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

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

      (E) BUYER, NCCC AND NCMC HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT
      PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
      LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER
      REPURCHASE DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

23.   NO WAIVERS, ETC.

      No failure on the part of Buyer or Seller to exercise and no delay in
      exercising, and no course of dealing with respect to, any right, power or
      privilege under any Repurchase Document shall operate as a waiver thereof,
      nor shall any single or partial exercise of any right, power or privilege
      under any Repurchase Document preclude any other or further exercise
      thereof or the exercise of any other right, power or privilege. The
      remedies provided herein are cumulative and not exclusive of any remedies
      provided by law. An Event of Default shall be deemed to be continuing
      unless expressly waived by Buyer in writing.

24.   SERVICING

      (a)   Each of NCCC and NCMC covenants to maintain or cause the servicing
            of the Mortgage Loans to be maintained in conformity with accepted
            and prudent servicing practices in the industry for the same type of
            mortgage loans as the Mortgage Loans and in a manner at least equal
            in quality to the servicing Seller provides for mortgage loans which
            it owns. In the event that the preceding

                                      -57-
<PAGE>

            language is interpreted as constituting one or more servicing
            contracts, each such servicing contract shall terminate
            automatically upon the earliest of (i) an Event of Default, (ii) the
            date on which this Agreement terminates or (iii) the transfer of
            servicing approved by Buyer.

      (b)   If the Mortgage Loans are serviced by Seller, Seller agrees that
            Buyer is the owner of all servicing records, including but not
            limited to any and all servicing agreements, files, documents,
            records, data bases, computer tapes, copies of computer tapes, proof
            of insurance coverage, insurance policies, appraisals, other closing
            documentation, payment history records, and any other records
            relating to or evidencing the servicing of the Mortgage Loans (the
            "SERVICING RECORDS"). Seller covenants to safeguard such Servicing
            Records and to deliver them promptly to Buyer or its designee
            (including Custodian) at Buyer's request.

      (c)   If the Mortgage Loans are serviced by a third party servicer (such
            third party servicer, the "SERVICER"), Seller (i) shall provide a
            copy of the servicing agreement to Buyer, which shall be in form and
            substance acceptable to Buyer (the "SERVICING AGREEMENT"); (ii)
            shall provide a Servicer Notice to the Servicer substantially in the
            form of EXHIBIT VIII hereto; and (iii) hereby irrevocably assigns to
            Buyer and Buyer's successors and assigns all right, title, interest
            of Seller in, to and under, and the benefits of, any Servicing
            Agreement with respect to the Mortgage Loans. Any successor to the
            Servicer shall be approved in writing by Buyer prior to such
            successor's assumption of servicing obligations with respect to the
            Mortgage Loans.

      (d)   If the servicer of the Mortgage Loans is Seller or Servicer is an
            Affiliate of Seller, Seller shall provide to Buyer a letter from
            Seller or Servicer, as the case may be, to the effect that upon the
            occurrence of an Event of Default, Buyer may terminate any Servicing
            Agreement and transfer servicing to its designee, at no cost or
            expense to Buyer, it being agreed that Seller will pay any and all
            fees required to terminate the Servicing Agreement and to effectuate
            the transfer of servicing to the designee of Buyer.

      (e)   After the Purchase Date, until the repurchase of any Mortgage Loan,
            Seller will have no right to modify or alter the terms of such
            Mortgage Loan and Seller will have no obligation or right to
            repossess such Mortgage Loan or substitute another Mortgage Loan, in
            each case except as provided in the Custodial Agreement.

      (f)   In the event Seller or its Affiliate is servicing the Mortgage
            Loans, Seller shall permit Buyer to inspect Seller's or its
            Affiliate's servicing facilities, as the case may be, for the
            purpose of satisfying Buyer that Seller or its Affiliate, as the
            case may be, has the ability to service the Mortgage Loans as
            provided in this Agreement.

                                      -58-
<PAGE>

25.   BUYER'S REPRESENTATIONS

            Buyer represents and warrants to Seller that as of the Effective
Date and as of the Repurchase Date for the repurchase of any Purchased Assets by
Seller from Buyer hereunder:

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

      (b)   APPROVALS. No authorizations, approvals or consents of, and no
            filings or registrations with, any Governmental Authority or any
            securities exchange are necessary for the execution, delivery or
            performance by Buyer, of the Repurchase Documents to which it is a
            party or for the legality, validity or enforceability thereof,
            except for filings and recordings in respect of the Liens created
            pursuant to the Repurchase Documents.

      (c)   NO BREACH. Neither (a) the execution and delivery of the Repurchase
            Documents nor (b) the consummation of the transactions therein
            contemplated to be entered into by Buyer in compliance with the
            terms and provisions thereof will conflict with or result in a
            breach of the organizational documents of Buyer, or any applicable
            law, rule or regulation, or any order, writ, injunction or decree of
            any Governmental Authority or other material agreement or instrument
            to which Buyer or any of its Subsidiaries is a party or by which
            Buyer or any of its Property is bound or to which Buyer is subject,
            or constitute a default under any such material agreement or
            instrument or result in the creation or imposition of any Lien upon
            any Property of Buyer, or any of its respective Subsidiaries
            pursuant to the terms of any such agreement or instrument.

      (d)   PURCHASED ASSETS. Immediately prior to the repurchase of any
            Purchased Assets by Seller, Buyer was the sole owner of such
            Purchased Assets and had good and marketable title thereto, free and
            clear of all Liens, in each case except for Liens to be released
            simultaneously with the repurchase by Seller hereunder.

26.   NETTING

      If Buyer and Seller are "financial institutions" as now or hereinafter
      defined in Section 4402 of Title 12 of the United States Code ("Section
      4402") and any rules or regulations promulgated thereunder,

      (a)   All amounts to be paid or advanced by one party to or on behalf of
            the other under this Agreement or any Transaction hereunder shall be
            deemed to be "payment obligations" and all amounts to be received by
            or on behalf of one party from the other under this Agreement or any
            Transaction hereunder shall be deemed to be

                                      -59-
<PAGE>

            "payment entitlements" within the meaning of Section 4402, and this
            Agreement shall be deemed to be a "netting contract" as defined in
            Section 4402.

      (b)   The payment obligations and the payment entitlements of the parties
            hereto pursuant to this Agreement and any Transaction hereunder
            shall be netted as follows. In the event that either party (the
            "DEFAULTING PARTY") shall fail to honor any payment obligation under
            this Agreement or any Transaction hereunder, the other party (the
            "NONDEFAULTING PARTY") shall be entitled to reduce the amount of any
            payment to be made by the Nondefaulting Party to the Defaulting
            Party by the amount of the payment obligation that the Defaulting
            Party failed to honor.

27.   PERIODIC DUE DILIGENCE REVIEW

      Seller acknowledges that Buyer has the right to perform continuing due
      diligence reviews with respect to the Mortgage Loans, for purposes of
      verifying compliance with the representations, warranties and
      specifications made hereunder, or otherwise, and Seller agrees that upon
      reasonable (but no less than one (1) Business Day's) prior notice unless
      an Event of Default shall have occurred, in which case no notice is
      required, to Seller, Buyer or its authorized representatives will be
      permitted during normal business hours to examine, inspect, and make
      copies and extracts of, the Mortgage Files and any and all documents,
      records, agreements, instruments or information relating to such Mortgage
      Loans in the possession or under the control of Seller and/or Custodian.
      Seller also shall make available to Buyer a knowledgeable financial or
      accounting officer for the purpose of answering questions respecting the
      Mortgage Files and the Mortgage Loans. Without limiting the generality of
      the foregoing, Seller acknowledges that Buyer may purchase Mortgage Loans
      from Seller based solely upon the information provided by Seller to Buyer
      in the Seller Asset Schedule and the representations, warranties and
      covenants contained herein, and that Buyer, at its option, has the right
      at any time to conduct a partial or complete due diligence review on some
      or all of the Mortgage Loans purchased in a Transaction, including without
      limitation ordering new credit reports and new appraisals on the related
      Mortgaged Properties and otherwise re-generating the information used to
      originate such Mortgage Loan. Buyer may underwrite such Mortgage Loans
      itself or engage a mutually agreed upon third party underwriter to perform
      such underwriting. Seller agrees to cooperate with Buyer and any third
      party underwriter in connection with such underwriting, including, but not
      limited to, providing Buyer and any third party underwriter with access to
      any and all documents, records, agreements, instruments or information
      relating to such Mortgage Loans in the possession, or under the control,
      of Seller. Buyer shall pay all out-of-pocket costs and expenses incurred
      by Buyer in connection with Buyer's activities pursuant to this Section 27
      ("DUE DILIGENCE COSTS"); provided that, in the event that a Default or an
      Event of Default shall have occurred, Seller shall reimburse Buyer for all
      Due Diligence Costs for any and all reasonable out-of-pocket costs and
      expenses incurred by Buyer in connection with Buyer's activities pursuant
      to this Section 27.

                                      -60-
<PAGE>

28.   BUYER'S APPOINTMENT AS ATTORNEY-IN-FACT

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

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

            (2)   to pay or discharge taxes and Liens levied or placed on or
                  threatened against the Purchased Items;

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

                                      -61-
<PAGE>

                  the intent of this Agreement, all as fully and effectively as
                  such Seller might do;

            (4)   after a Default or an Event of Default, to direct the actions
                  of Custodian with respect to the Purchased Items under the
                  Custodial Agreement; and

            (5)   to execute, from time to time, in connection with any sale
                  provided for in Section 13, any endorsements, assignments or
                  other instruments of conveyance or transfer with respect to
                  the Purchased Items.

      Each of NCCC and NCMC hereby ratifies all that said attorneys shall
      lawfully do or cause to be done by virtue hereof. This power of attorney
      is a power coupled with an interest and shall be irrevocable. Until the
      occurrence of a Default or Event of Default, Buyer shall not direct a
      Servicer in its servicing of the Purchased Assets or commence any
      servicing actions with respect to the Mortgage Loans pursuant to this
      Section 28(a). Neither Buyer nor any of its officers, directors, employers
      or agents shall be responsible to Seller for any failure to act hereunder
      prior to a Default or Event of Default.

      (b)   The powers conferred on Buyer hereunder are solely to protect
            Buyer's interests in the Purchased Items and Purchased Assets and
            shall not impose any duty upon it to exercise any such powers. Buyer
            shall be accountable only for amounts that it actually receives as a
            result of the exercise of such powers, and neither it nor any of its
            officers, directors, employees or agents shall be responsible to
            Seller for any act or failure to act hereunder, except for its or
            their own gross negligence or willful misconduct.

29.   MISCELLANEOUS

      (a)   If there is any conflict between the terms of this Agreement or any
            Transaction entered into hereunder and the Custodial Agreement, this
            Agreement shall prevail.

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

      (c)   The captions and headings appearing herein are for included solely
            for convenience of reference and are not intended to affect the
            interpretation of any provision of this Agreement.

      (d)   Each of NCCC and NCMC hereby acknowledges that:

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

            (2)   Buyer has no fiduciary relationship to Seller; and

            (3)   no joint venture exists between Buyer and Seller.

                                      -62-
<PAGE>

30.   CONFIDENTIALITY

      Seller hereby acknowledges and agrees that all information regarding the
      terms set forth in any of the Repurchase Documents or the Transactions
      contemplated thereby (the "CONFIDENTIAL TERMS") shall be kept confidential
      and shall not be divulged to any party without the prior written consent
      of such other party except to the extent that (i) it is necessary to do so
      in working with legal counsel, auditors, taxing authorities or other
      governmental agencies or regulatory bodies or in order to comply with any
      applicable federal or state laws, (ii) any of the Confidential Terms are
      in the public domain other than due to a breach of this covenant, or (iii)
      in the event of a Default or an Event of Default Buyer determines such
      information to be necessary or desirable to disclose in connection with
      the marketing and sales of the Purchased Assets or otherwise to enforce or
      exercise Buyer's rights hereunder. The provisions set forth in this
      Section 30 shall survive the termination of this Agreement for a period of
      one year following such termination.

31.   CONFLICTS

      In the event of any conflict between the terms of this Agreement, any
      other Repurchase Document and any Confirmation, the documents shall
      control in the following order of priority: FIRST, the terms of the
      Confirmation shall prevail, then the terms of this Agreement shall
      prevail, and then the terms of the other Repurchase Documents shall
      prevail.

32.   SET-OFF.

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

33.   OBLIGATIONS JOINT AND SEVERAL.

      Each of NCCC and NCMC hereby acknowledges and agrees that it shall be
      jointly and severally liable to Buyer for all representations, warranties,
      covenants, obligations and indemnities of Seller hereunder.

                                      -63-
<PAGE>

                            [SIGNATURE PAGE FOLLOWS]

                                      -64-
<PAGE>

            IN WITNESS WHEREOF, the parties have entered into this Agreement as
of the date set forth above.

                                        BUYER:

                                        CDC MORTGAGE CAPITAL INC.

                                        By: /s/ Adil Nathani
                                            ------------------------------------
                                        Name: ADIL NATHANI
                                        Title: MANAGING DIRECTOR

                                        By: /s/ William Branagh
                                            ------------------------------------
                                        Name: William Branagh
                                        Title: Director

            ADDRESS FOR NOTICES:              With a copy to:

            9 West 57th Street                9 West 57th Street
            New York, NY 10019                New York, NY 10019
            Attention: Ray Sullivan           Attention: Al Zakes, Esq.,
            Telecopier No.:                   General Counsel
            (212) 891-3350                    Telecopier No.: (212) 891-1922
            Telephone No.:                    Telephone No.: (212) 891-6137
            (212) 891-5815                    Email address:
            Email address:                    albert.zakes@cdcixis-cnma.com
            sullivr@cdcna.com

<PAGE>

                                        SELLER:

                                        NEW CENTURY MORTGAGE
                                           CORPORATION

                                        By: /s/ PATRICK FLANAGAN
                                            ------------------------------------
                                        Name: PATRICK FLANAGAN
                                        Title: EXECUTIVE VICE PRESIDENT

                                        ADDRESS FOR NOTICES:

                                            18400 Von Karman, Suite 1000
                                            Irvine, California 92612
                                            Attn:  Sean Carter, Esq.
                                            Telecopier No.: (949) 440-7033
                                            Telephone No: (949) 862-7749
                                            Email: scarter@ncen.com

                                        NC CAPITAL CORPORATION

                                        By: /s/ PATRICK FLANAGAN
                                            ------------------------------------
                                        Name: PATRICK FLANAGAN
                                        Title: PRESIDENT

                                        ADDRESS FOR NOTICES:

                                            18400 Von Karman, Suite 1000
                                            Irvine, California 92612
                                            Attn:  Sean Carter, Esq.
                                            Telecopier No.: (949) 440-7033
                                            Telephone No: (949) 862-7749
                                            Email: scarter@ncen.com

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