Document:

EXHIBIT 4.1

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                                STANDARD TERMS OF
                         POOLING AND SERVICING AGREEMENT

                          Dated as of December 1, 2006

                        Residential Accredit Loans, Inc.
                 Mortgage Asset-Backed Pass-Through Certificates

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                                TABLE OF CONTENTS

                                                                            Page

Article I    DEFINITIONS.......................................................2

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

      Section 1.02.     Use of Words and Phrases..............................35

Article II   CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF
             CERTIFICATES.....................................................36

      Section 2.01.     Conveyance of Mortgage Loans..........................36

      Section 2.02.     Acceptance by Trustee.................................43

      Section 2.03.     Representations, Warranties and Covenants of the
                          Master Servicer and the Company.....................44

      Section 2.04.     Representations and Warranties of Residential
                          Funding.............................................46

      Section 2.05.     Execution and Authentication of Certificates/Issuance
                          of Certificates Evidencing Interests in REMIC I
                          Certificates........................................48

      Section 2.06.     Conveyance of Uncertificated REMIC I and REMIC II
                          Regular Interests; Acceptance by the Trustee........48

      Section 2.07.     Issuance of Certificates Evidencing Interests in
                          REMIC II............................................48

      Section 2.08.     Purposes and Powers of the Trust......................48

Article III  ADMINISTRATION AND SERVICING OF MORTGAGE LOANS...................48

      Section 3.01.     Master Servicer to Act as Servicer....................48

      Section 3.02.     Subservicing Agreements Between Master Servicer and
                          Subservicers; Enforcement of Subservicers' and
                          Sellers' Obligations................................50

      Section 3.03.     Successor Subservicers................................51

      Section 3.04.     Liability of the Master Servicer......................51

      Section 3.05.     No Contractual Relationship Between Subservicer and
                          Trustee or Certificateholders.......................52

      Section 3.06.     Assumption or Termination of Subservicing Agreements
                          by Trustee..........................................52

      Section 3.07.     Collection of Certain Mortgage Loan Payments;
                          Deposits to Custodial Account.......................52

      Section 3.08.     Subservicing Accounts; Servicing Accounts.............55

      Section 3.09.     Access to Certain Documentation and  Information
                          Regarding the Mortgage Loans........................57

                                      -i-

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                                TABLE OF CONTENTS
                                   (continued)
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      Section 3.10.     Permitted Withdrawals from the Custodial Account......57

      Section 3.11.     Maintenance of the Primary Insurance  Policies;
                          Collections Thereunder..............................59

      Section 3.12.     Maintenance of Fire Insurance and  Omissions and
                          Fidelity Coverage...................................60

      Section 3.13.     Enforcement of Due-on-Sale Clauses; Assumption and
                          Modification Agreements; Certain Assignments........61

      Section 3.14.     Realization Upon Defaulted Mortgage Loans.............63

      Section 3.15.     Trustee to Cooperate; Release of Custodial Files......67

      Section 3.16.     Servicing and Other Compensation; Compensating
                          Interest............................................68

      Section 3.17.     Reports to the Trustee and the Company................69

      Section 3.18.     Annual Statement as to Compliance and Servicing
                          Assessment..........................................69

      Section 3.19.     Annual Independent Public Accountants' Servicing
                          Report..............................................70

      Section 3.20.     Rights of the Company in Respect of the Master
                          Servicer............................................70

      Section 3.21.     Administration of Buydown Funds.......................70

      Section 3.22.     Advance Facility......................................71

Article IV   PAYMENTS TO CERTIFICATEHOLDERS...................................75

      Section 4.01.     Certificate Account...................................75

      Section 4.02.     Distributions.     ...................................76

      Section 4.03.     Statements to Certificateholders; Statements to
                          Rating Agencies; Exchange Act Reporting.............76

      Section 4.04.     Distribution of Reports to the Trustee and  the
                          Company; Advances by the Master Servicer............78

      Section 4.05.     Allocation of Realized Losses.........................79

      Section 4.06.     Reports of Foreclosures and Abandonment of
                          Mortgaged Property..................................80

      Section 4.07.     Optional Purchase of Defaulted Mortgage Loans.........80

      Section 4.08.     Surety Bond...........................................80

Article V    THE CERTIFICATES.................................................81

      Section 5.01.     The Certificates......................................81

      Section 5.02.     Registration of Transfer and Exchange of
                          Certificates........................................83

      Section 5.03.     Mutilated, Destroyed, Lost or Stolen Certificates.....89

                                      -ii-

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                                TABLE OF CONTENTS
                                   (continued)
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      Section 5.04.     Persons Deemed Owners.................................89

      Section 5.05.     Appointment of Paying Agent...........................90

      Section 5.06.     U.S.A. Patriot Act Compliance.........................90

Article VI   THE COMPANY AND THE MASTER SERVICER..............................91

      Section 6.01.     Respective Liabilities of the Company and the
                          Master Servicer.....................................91

      Section 6.02.     Merger or Consolidation of the Company or the
                          Master Servicer; Assignment of Rights and
                          Delegation of Duties by Master Servicer.............91

      Section 6.03.     Limitation on Liability of the Company, the Master
                          Servicer and Others.................................92

      Section 6.04.     Company and Master Servicer Not to Resign.............93

Article VII  DEFAULT..........................................................94

      Section 7.01.     Events of Default.....................................94

      Section 7.02.     Trustee or Company to Act; Appointment of Successor...96

      Section 7.03.     Notification to Certificateholders....................97

      Section 7.04.     Waiver of Events of Default...........................97

Article VIII   CONCERNING THE TRUSTEE.........................................98

      Section 8.01.     Duties of Trustee.....................................98

      Section 8.02.     Certain Matters Affecting the Trustee.................99

      Section 8.03.     Trustee Not Liable for Certificates or
                          Mortgage Loans.....................................101

      Section 8.04.     Trustee May Own Certificates.........................101

      Section 8.05.     Master Servicer to Pay Trustee's Fees  and Expenses;
                          Indemnification....................................101

      Section 8.06.     Eligibility Requirements for Trustee.................102

      Section 8.07.     Resignation and Removal of the Trustee...............103

      Section 8.08.     Successor Trustee....................................104

      Section 8.09.     Merger or Consolidation of Trustee...................104

      Section 8.10.     Appointment of Co-Trustee or Separate Trustee........104

      Section 8.11.     Appointment of the Custodian.........................105

      Section 8.12.     Appointment of Office or Agency......................106

                                     -iii-

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                                TABLE OF CONTENTS
                                   (continued)
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Article IX   TERMINATION OR OPTIONAL PURCHASE OF ALL CERTIFICATES............107

      Section 9.01.     Optional Purchase by the Master Servicer of All
                          Certificates; Termination Upon Purchase by the
                          Master Servicer or Liquidation of All Mortgage
                          Loans..............................................107

      Section 9.02.     Additional Termination Requirements..................110

      Section 9.03.     Termination of Multiple REMICs.......................111

Article X    REMIC PROVISIONS................................................112

      Section 10.01.    REMIC Administration.................................112

      Section 10.02.    Master Servicer, REMIC Administrator and Trustee
                          Indemnification....................................115

      Section 10.03.    Designation of REMIC(s)..............................116

      Section 10.04.    Distributions on the Uncertificated REMIC I and
                          REMIC II Regular Interests.........................116

      Section 10.05.    Compliance with Withholding Requirements.............116

Article XI   MISCELLANEOUS PROVISIONS........................................117

      Section 11.01.    Amendment............................................117

      Section 11.02.    Recordation of Agreement; Counterparts...............119

      Section 11.03.    Limitation on Rights of Certificateholders...........120

      Section 11.04.    Governing Law........................................120

      Section 11.05.    Notices..............................................121

      Section 11.06.    Required Notices to Rating Agency and Subservicer....121

      Section 11.07.    Severability of Provisions...........................122

      Section 11.08.    Supplemental Provisions for Resecuritization.........122

      Section 11.09.    Allocation of Voting Rights..........................122

      Section 11.10.    No Petition..........................................122

Article XII  COMPLIANCE WITH REGULATION AB...................................123

      Section 12.01.    Intent of the Parties; Reasonableness................123

      Section 12.02.    Additional Representations and Warranties of
                          the Trustee........................................123

      Section 12.03.    Information to Be Provided by the Trustee............124

      Section 12.04.    Report on Assessment of Compliance and Attestation...124

                                      -iv-

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                                TABLE OF CONTENTS
                                   (continued)
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      Section 12.05.    Indemnification; Remedies............................125

                                      -v-

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                                    EXHIBITS

Exhibit A:      Form of Class A Certificate
Exhibit A-I:    Form of Class X Certificate
Exhibit B:      Form of Class M Certificate
Exhibit C:      Form of Class B Certificate
Exhibit C-I:    Form of Class P Certificate
Exhibit C-II:   Form of Class SB Certificate
Exhibit D:      Form of Class R Certificate
Exhibit E:      Form of Seller/Servicer Contract
Exhibit F:      Forms of Request for Release
Exhibit G-1:    Form of Transfer Affidavit and Agreement
Exhibit G-2:    Form of Transferor Certificate
Exhibit H:      Form of Investor Representation Letter
Exhibit I:      Form of Transferor Representation Letter
Exhibit J:      Form of Rule 144A Investment Representation Letter
Exhibit K:      Text of Amendment to Pooling and Servicing Agreement Pursuant to
                Section 11.01(e) for a Limited Guaranty
Exhibit L:      Form of Limited Guaranty
Exhibit M:      Form of Lender Certification for Assignment of Mortgage Loan
Exhibit N:      Request for Exchange Form
Exhibit O:      Form of Form 10-K Certification
Exhibit P:      Form of Back-Up Certification to Form 10-K Certificate
Exhibit Q:      Information to be Provided by the Master Servicer to the
                Rating Agencies
                Relating to Reportable Modified Mortgage Loans
Exhibit R:      Servicing Criteria

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      This is the Standard Terms of Pooling and Servicing Agreement, dated as of
December 1, 2006 (the "Standard Terms",  and as incorporated by reference into a
Series  Supplement  dated as of the Cut-off  Date,  the "Pooling  and  Servicing
Agreement" or  "Agreement"),  among  RESIDENTIAL  ACCREDIT  LOANS,  INC., as the
company  (together with its permitted  successors and assigns,  the  "Company"),
RESIDENTIAL  FUNDING  COMPANY,  LLC,  as  master  servicer  (together  with  its
permitted successors and assigns, the "Master Servicer"),  and the trustee named
in the applicable Series Supplement  (together with its permitted successors and
assigns, the "Trustee").

                             PRELIMINARY STATEMENT:

      The Company  intends to sell certain  mortgage  asset-backed  pass-through
certificates  (collectively,  the  "Certificates"),   to  be  issued  under  the
Agreement in multiple  classes,  which in the aggregate will evidence the entire
beneficial ownership interest in the Mortgage Loans.

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

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                                    Article I

                                   DEFINITIONS

Section 1.01.     Definitions.

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

      Accretion Termination Date:  As defined in the Series Supplement.

      Accrual Certificates:  As defined in the Series Supplement.

      Accrued Certificate  Interest:  With respect to each Distribution Date, as
to any  Class  or  Subclass  of  Certificates  (other  than any  Principal  Only
Certificates),  interest  accrued during the related  Interest Accrual Period at
the related  Pass-Through Rate on the Certificate  Principal Balance or Notional
Amount thereof  immediately prior to such Distribution Date. Accrued Certificate
Interest will be calculated on the basis of a 360-day year, consisting of twelve
30-day  months.  In each  case  Accrued  Certificate  Interest  on any  Class or
Subclass of Certificates will be reduced by the amount of:

      (i)   Prepayment  Interest  Shortfalls  on all  Mortgage  Loans or, if the
            Mortgage  Pool is  comprised  of two or  more  Loan  Groups,  on the
            Mortgage  Loans in the related  Loan Group (to the extent not offset
            by the Master  Servicer with a payment of  Compensating  Interest as
            provided in Section 4.01),

      (ii)  the interest  portion  (adjusted  to the Net  Mortgage  Rate (or the
            Modified Net Mortgage Rate in the case of a Modified Mortgage Loan))
            of Realized Losses on all Mortgage Loans or, if the Mortgage Pool is
            comprised of two or more Loan Groups,  on the Mortgage  Loans in the
            related Loan Group (including  Excess Special Hazard Losses,  Excess
            Fraud Losses, Excess Bankruptcy Losses and Extraordinary Losses) not
            allocated  solely to one or more  specific  Classes of  Certificates
            pursuant to Section 4.05,

      (iii) the interest  portion of Advances that were (A) previously made with
            respect to a Mortgage Loan or REO Property on all Mortgage Loans or,
            if the Mortgage Pool is comprised of two or more Loan Groups, on the
            Mortgage   Loans  in  the  related   Loan  Group,   which   remained
            unreimbursed  following the Cash  Liquidation or REO  Disposition of
            such  Mortgage  Loan or REO  Property  and (B) made with  respect to
            delinquencies  that were ultimately  determined to be Excess Special
            Hazard  Losses,  Excess Fraud Losses,  Excess  Bankruptcy  Losses or
            Extraordinary Losses, and

      (iv)  any other  interest  shortfalls  not  covered  by the  subordination
            provided  by the  Class M  Certificates  and  Class B  Certificates,
            including  interest  that  is not  collectible  from  the  Mortgagor
            pursuant to the Servicemembers Civil Relief Act of 1940, as amended,
            or similar  legislation  or  regulations  as in effect  from time to
            time,

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with  all  such  reductions  allocated  (A)  among  all of the  Certificates  in
proportion to their respective amounts of Accrued  Certificate  Interest payable
on such  Distribution Date absent such reductions or (B) if the Mortgage Pool is
comprised  of two or more Loan Groups,  the related  Senior  Percentage  of such
reductions among the related Senior Certificates in proportion to the amounts of
Accrued  Certificate  Interest  payable  from  the  related  Loan  Group on such
Distribution Date absent such reductions,  with the remainder of such reductions
allocated among the holders of the Class M Certificates and Class B Certificates
in  proportion  to their  respective  amounts  of Accrued  Certificate  Interest
payable on such  Distribution  Date absent such reductions.  In addition to that
portion of the reductions described in the preceding sentence that are allocated
to any  Class  of Class B  Certificates  or any  Class of Class M  Certificates,
Accrued Certificate Interest on such Class of Class B Certificates or such Class
of Class M Certificates will be reduced by the interest portion (adjusted to the
Net Mortgage Rate) of Realized Losses that are allocated solely to such Class of
Class B Certificates  or such Class of Class M Certificates  pursuant to Section
4.05.

      Addendum and Assignment Agreement:  The Addendum and Assignment Agreement,
dated as of January 31, 1995, between MLCC and the Master Servicer.

      Additional  Collateral:  Any of the  following  held,  in  addition to the
related  Mortgaged  Property,  as security for a Mortgage  Loan:  (i) all money,
securities,  security  entitlements,   accounts,  general  intangibles,  payment
rights,  instruments,  documents,  deposit  accounts,  certificates  of deposit,
commodities  contracts  and other  investment  property  and other  property  of
whatever kind or description now existing or hereafter acquired which is pledged
as  security  for  the  repayment  of  such  Mortgage  Loan,  (ii)   third-party
guarantees,  and (A) all money,  securities,  security  entitlements,  accounts,
general intangibles,  payment rights, instruments,  documents, deposit accounts,
certificates of deposit, commodities contracts and other investment property and
other  property of  whatever  kind or  description  now  existing  or  hereafter
acquired  which is pledged as collateral for such guarantee or (B) any mortgaged
property  securing  the  performance  of such  guarantee,  or (iii)  such  other
collateral as may be set forth in the Series Supplement.

      Additional  Collateral  Loan:  Each  Mortgage  Loan that is  supported  by
Additional Collateral.

      Adjusted  Mortgage Rate: With respect to any Mortgage Loan and any date of
determination,  the Mortgage Rate borne by the related  Mortgage Note,  less the
rate at which the related Subservicing Fee accrues.

      Advance: As to any Mortgage Loan, any advance made by the Master Servicer,
pursuant to Section 4.04.

      Advance Facility: As defined in Section 3.22.

      Advance Facility Notice: As defined in Section 3.22.

      Advance Facility Trustee: As defined in Section 3.22.

      Advancing Person: As defined in Section 3.22.

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      Advance Reimbursement Amounts: As defined in Section 3.22.

      Affiliate:  With  respect to any  Person,  any other  Person  controlling,
controlled by or under common  control with such first Person.  For the purposes
of this  definition,  "control"  means the power to direct  the  management  and
policies of such Person,  directly or indirectly,  whether through the ownership
of voting securities,  by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.

      Ambac:  Ambac  Assurance  Corporation  (formerly  known as AMBAC Indemnity
Corporation).

      Amount Held for Future Distribution: As to any Distribution Date and, with
respect to any Mortgage Pool that is comprised of two or more Loan Groups,  each
Loan Group, the total of the amounts held in the Custodial  Account at the close
of business on the preceding  Determination  Date on account of (i)  Liquidation
Proceeds, Subsequent Recoveries, Insurance Proceeds, Curtailments, Mortgage Loan
purchases  made pursuant to Section 2.02,  2.03,  2.04 or 4.07 and Mortgage Loan
substitutions  made  pursuant  to Section  2.03 or 2.04  received or made in the
month of such Distribution Date (other than such Liquidation Proceeds, Insurance
Proceeds and purchases of Mortgage Loans that the Master  Servicer has deemed to
have been received in the preceding month in accordance  with Section  3.07(b)),
and Principal  Prepayments in Full made after the related Prepayment Period, and
(ii) payments which represent  early receipt of scheduled  payments of principal
and interest due on a date or dates subsequent to the related Due Date.

      Appraised  Value:  As to any  Mortgaged  Property,  the  lesser of (i) the
appraised value of such Mortgaged  Property based upon the appraisal made at the
time of the  origination of the related  Mortgage Loan, and (ii) the sales price
of the Mortgaged  Property at such time of origination,  except in the case of a
Mortgaged  Property  securing a refinanced or modified Mortgage Loan as to which
it is  either  the  appraised  value  determined  above or the  appraised  value
determined in an appraisal at the time of  refinancing or  modification,  as the
case may be.

      Assigned  Contracts:  With respect to any Pledged  Asset Loan:  the Credit
Support Pledge Agreement; the Funding and Pledge Agreement, among GMAC Mortgage,
LLC, National Financial  Services  Corporation and the Mortgagor or other person
pledging  the related  Pledged  Assets;  the  Additional  Collateral  Agreement,
between  GMAC  Mortgage,  LLC and the  Mortgagor  or other  person  pledging the
related  Pledged  Assets;  or such  other  contracts  as may be set forth in the
Series Supplement.

      Assignment:   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 of
record  the  sale  of the  Mortgage  Loan to the  Trustee  for  the  benefit  of
Certificateholders,   which   assignment,   notice  of  transfer  or  equivalent
instrument  may be in the  form  of one or  more  blanket  assignments  covering
Mortgages  secured  by  Mortgaged  Properties  located  in the same  county,  if
permitted by law and accompanied by an Opinion of Counsel to that effect.

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<PAGE>

      Assignment Agreement:  The Assignment and Assumption Agreement,  dated the
Closing  Date,  between  Residential  Funding  and the  Company  relating to the
transfer and assignment of the Mortgage Loans.

      Assignment Agreement and Amendment of Security Instrument: With respect to
a Sharia  Mortgage  Loan,  the  agreement  between the consumer and the co-owner
pursuant  to which all of the  co-owner's  interest as a  beneficiary  under the
related Sharia Mortgage Loan Security  Instrument and the co-owner's interest in
the related Mortgaged Property is conveyed to a subsequent owner, which may take
the form of an "Assignment  Agreement" and an "Amendment of Security Instrument"
or  an  "Assignment  Agreement  and  Amendment  of  Security   Instrument",   as
applicable.

      Assignment of Proprietary  Lease:  With respect to a Cooperative Loan, the
assignment of the related Cooperative Lease from the Mortgagor to the originator
of the Cooperative Loan.

      Available  Distribution  Amount:  As to any  Distribution  Date and,  with
respect to any Mortgage  Pool  comprised  of two or more Loan Groups,  each Loan
Group, an amount equal to (a) the sum of (i) the amount relating to the Mortgage
Loans on deposit in the  Custodial  Account as of the close of  business  on the
immediately preceding  Determination Date, including any Subsequent  Recoveries,
and  amounts   deposited  in  the  Custodial  Account  in  connection  with  the
substitution  of Qualified  Substitute  Mortgage  Loans,  (ii) the amount of any
Advance made on the  immediately  preceding  Certificate  Account  Deposit Date,
(iii) any amount deposited in the Certificate Account on the related Certificate
Account Deposit Date pursuant to the second paragraph of Section  3.12(a),  (iv)
any amount  deposited  in the  Certificate  Account  pursuant to Section 4.07 or
Section  9.01,  (v) any amount  that the Master  Servicer  is not  permitted  to
withdraw  from the  Custodial  Account or the  Certificate  Account  pursuant to
Section 3.16(e),  (vi) any amount received by the Trustee pursuant to the Surety
Bond in respect of such  Distribution Date and (vii) the proceeds of any Pledged
Assets received by the Master  Servicer,  reduced by (b) the sum as of the close
of business on the  immediately  preceding  Determination  Date of (w) aggregate
Foreclosure  Profits,  (x) the  Amount  Held for  Future  Distribution,  and (y)
amounts  permitted  to be withdrawn by the Master  Servicer  from the  Custodial
Account  in  respect  of  the  Mortgage  Loans  pursuant  to  clauses  (ii)-(x),
inclusive,  of Section 3.10(a).  Such amount shall be determined  separately for
each  Loan  Group.  Additionally,  with  respect  to any  Mortgage  Pool that is
comprised of two or more Loan Groups,  if on any Distribution  Date Compensating
Interest  provided  pursuant  to this  Section  3.16(e) is less than  Prepayment
Interest  Shortfalls incurred on the Mortgage Loans in connection with Principal
Prepayments  in Full and  Curtailments  made in the prior calendar  month,  such
Compensating  Interest  shall  be  allocated  on such  Distribution  Date to the
Available  Distribution  Amount  for each  Loan  Group  on a pro  rata  basis in
accordance with the respective  amounts of such Prepayment  Interest  Shortfalls
incurred  on  the  Mortgage  Loans  in  such  Loan  Group  in  respect  of  such
Distribution Date.

      Bankruptcy Code:  The Bankruptcy Code of 1978, as amended.

      Bankruptcy Loss: With respect to any Mortgage Loan, a Deficient  Valuation
or Debt Service Reduction; provided, however, that neither a Deficient Valuation
nor a Debt Service Reduction shall be deemed a Bankruptcy Loss hereunder so long
as the Master  Servicer  has  notified  the  Trustee in writing  that the Master
Servicer is diligently  pursuing any remedies that

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<PAGE>

may exist in connection with the  representations  and warranties made regarding
the related  Mortgage  Loan and either (A) the related  Mortgage  Loan is not in
default with regard to payments due  thereunder  or (B)  delinquent  payments of
principal and interest  under the related  Mortgage Loan and any premiums on any
applicable  primary hazard  insurance  policy and any related escrow payments in
respect  of such  Mortgage  Loan are being  advanced  on a current  basis by the
Master  Servicer or a  Subservicer,  in either case without giving effect to any
Debt Service Reduction.

      Book-Entry  Certificate:  Any  Certificate  registered  in the name of the
Depository or its nominee,  and designated as such in the Preliminary  Statement
to the Series Supplement.

      Business  Day: Any day other than (i) a Saturday or a Sunday or (ii) a day
on which banking  institutions  in the State of New York, the State of Michigan,
the State of  California,  the State of Illinois or the State of Minnesota  (and
such other  state or states in which the  Custodial  Account or the  Certificate
Account are at the time  located) are required or authorized by law or executive
order to be closed.

      Buydown  Funds:  Any  amount  contributed  by the  seller  of a  Mortgaged
Property, the Company or other source in order to enable the Mortgagor to reduce
the payments  required to be made from the Mortgagor's  funds in the early years
of a  Mortgage  Loan.  Buydown  Funds  are not part of the Trust  Fund  prior to
deposit into the Custodial or Certificate Account.

      Buydown Mortgage Loan: Any Mortgage Loan as to which a specified amount of
interest  is paid out of  related  Buydown  Funds in  accordance  with a related
buydown agreement.

      Calendar Quarter: A Calendar Quarter shall consist of one of the following
time periods in any given year: January 1 through March 31, April 1 through June
30, July 1 through September 30, and October 1 through December 31.

      Capitalization Reimbursement Amount: With respect to any Distribution Date
and,  with  respect to any Mortgage  Pool  comprised of two or more Loan Groups,
each Loan Group, the amount of Advances or Servicing Advances that were added to
the Stated  Principal  Balance of all Mortgage Loans or, if the Mortgage Pool is
comprised of two or more Loan Groups,  on the Mortgage Loans in the related Loan
Group,  during the prior calendar month and reimbursed to the Master Servicer or
Subservicer  on  or  prior  to  such   Distribution  Date  pursuant  to  Section
3.10(a)(vii),  plus the Capitalization  Reimbursement Shortfall Amount remaining
unreimbursed  from any prior  Distribution  Date and  reimbursed  to the  Master
Servicer or Subservicer on or prior to such Distribution Date.

      Capitalization   Reimbursement  Shortfall  Amount:  With  respect  to  any
Distribution  Date and,  with respect to any Mortgage  Pool  comprised of two or
more Loan Groups,  each Loan Group,  the amount,  if any, by which the amount of
Advances or Servicing  Advances that were added to the Stated Principal  Balance
of all Mortgage Loans (or, if the Mortgage Pool is comprised of two or more Loan
Groups,  on the Mortgage  Loans in the related Loan Group)  during the preceding
calendar  month exceeds the amount of principal  payments on the Mortgage  Loans
included in the  Available  Distribution  Amount (or,  if the  Mortgage  Pool is
comprised  of

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<PAGE>

two or more Loan  Groups,  Available  Distribution  Amount for the related  Loan
Group) for that Distribution Date.

      Cash Liquidation:  As to any defaulted Mortgage Loan other than a Mortgage
Loan as to which an REO  Acquisition  occurred,  a  determination  by the Master
Servicer that it has received all Insurance Proceeds,  Liquidation  Proceeds and
other payments or cash recoveries  which the Master  Servicer  reasonably and in
good faith expects to be finally recoverable with respect to such Mortgage Loan.

      Certificate  Account  Deposit  Date:  As to  any  Distribution  Date,  the
Business Day prior thereto.

      Certificateholder  or Holder:  The Person in whose name a  Certificate  is
registered  in  the  Certificate  Register,  and,  in  respect  of  any  Insured
Certificates,  the  Certificate  Insurer to the extent of  Cumulative  Insurance
Payments,  except that  neither a  Disqualified  Organization  nor a  Non-United
States  Person shall be a holder of a Class R  Certificate  for purposes  hereof
and, solely for the purpose of giving any consent or direction  pursuant to this
Agreement, any Certificate, other than a Class R Certificate,  registered in the
name of the Company,  the Master  Servicer or any  Subservicer  or any Affiliate
thereof shall be deemed not to be  outstanding  and the  Percentage  Interest or
Voting Rights  evidenced  thereby shall not be taken into account in determining
whether the requisite amount of Percentage  Interests or Voting Rights necessary
to effect any such consent or direction has been obtained. All references herein
to "Holders" or  "Certificateholders"  shall  reflect the rights of  Certificate
Owners as they may  indirectly  exercise such rights  through the Depository and
participating members thereof,  except as otherwise specified herein;  provided,
however,  that the  Trustee  shall be  required  to  recognize  as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register.

      Certificate Insurer: As defined in the Series Supplement.

      Certificate  Owner: With respect to a Book-Entry  Certificate,  the Person
who is the beneficial owner of such Certificate, as reflected on the books of an
indirect participating brokerage firm for which a Depository Participant acts as
agent, if any, and otherwise on the books of a Depository  Participant,  if any,
and otherwise on the books of the Depository.

      Certificate  Principal  Balance:  With respect to each Certificate  (other
than any Interest Only  Certificate),  on any date of  determination,  an amount
equal to:

      (i)   the Initial  Certificate  Principal  Balance of such  Certificate as
            specified on the face thereof, plus

      (ii)  any Subsequent Recoveries added to the Certificate Principal Balance
            of such Certificate pursuant to Section 4.02, plus

      (iii) in the case of each  Accrual  Certificate,  an  amount  equal to the
            aggregate  Accrued  Certificate  Interest  added to the  Certificate
            Principal Balance thereof prior to such date of determination, minus

                                       7
<PAGE>

      (iv)  the sum of (x) the aggregate of all amounts  previously  distributed
            with respect to such  Certificate (or any  predecessor  Certificate)
            and  applied to reduce the  Certificate  Principal  Balance  thereof
            pursuant to Section  4.02(a) and (y) the aggregate of all reductions
            in  Certificate   Principal  Balance  deemed  to  have  occurred  in
            connection with Realized  Losses which were previously  allocated to
            such  Certificate  (or  any  predecessor  Certificate)  pursuant  to
            Section 4.05;

provided,  that the  Certificate  Principal  Balance of each  Certificate of the
Class of  Subordinate  Certificates  with the Lowest  Priority at any given time
shall  be  further  reduced  by an  amount  equal  to  the  Percentage  Interest
represented  by such  Certificate  multiplied by the excess,  if any, of (A) the
then aggregate Certificate Principal Balance of all Classes of Certificates then
outstanding over (B) the then aggregate Stated Principal Balance of the Mortgage
Loans.

      Certificate  Register and Certificate  Registrar:  The register maintained
and the registrar appointed pursuant to Section 5.02.

      Class: Collectively, all of the Certificates bearing the same designation.
The initial Class A-V  Certificates  and any Subclass thereof issued pursuant to
Section 5.01(c) shall be a single Class for purposes of this Agreement.

      Class A-P Certificate:  Any one of the Certificates  designated as a Class
A-P Certificate.

      Class A-P Collection  Shortfall:  With respect to the Cash  Liquidation or
REO  Disposition of a Discount  Mortgage Loan, any  Distribution  Date and, with
respect to any Mortgage  Pool  comprised  of two or more Loan Groups,  each Loan
Group,  the excess of the amount described in clause (C)(1) of the definition of
Class  A-P  Principal  Distribution  Amount  (for the  related  Loan  Group,  if
applicable) over the amount described in clause (C)(2) of such definition.

      Class A-P Principal  Distribution Amount: With respect to any Distribution
Date and,  with  respect  to any  Mortgage  Pool  comprised  of two or more Loan
Groups, each Loan Group, an amount equal to the aggregate of:

            (A) the related Discount  Fraction of the principal  portion of each
      Monthly  Payment on each  Discount  Mortgage Loan (or, with respect to any
      Mortgage Pool comprised of two or more Loan Groups, each Discount Mortgage
      Loan in the related Loan Group) due during the related Due Period, whether
      or not received on or prior to the related  Determination  Date, minus the
      Discount  Fraction of the  principal  portion of any related  Debt Service
      Reduction  which  together  with  other  Bankruptcy   Losses  exceeds  the
      Bankruptcy Amount;

            (B) the related  Discount  Fraction of the principal  portion of all
      unscheduled  collections on each Discount  Mortgage Loan (or, with respect
      to any Mortgage Pool  comprised of two or more Loan Groups,  each Discount
      Mortgage  Loan in the related Loan Group)  received  during the  preceding
      calendar month or, in the case of Principal  Prepayments  in Full,  during
      the related  Prepayment  Period (other than amounts received in connection
      with a Cash  Liquidation or REO  Disposition  of a Discount  Mortgage Loan
      described in clause (C) below),  including Principal  Prepayments in Full,
      Curtailments,  Subsequent  Recoveries and  repurchases  (including  deemed
      repurchases under Section

                                       8
<PAGE>

      3.07(b))  of  such  Discount   Mortgage  Loans  (or,  in  the  case  of  a
      substitution  of a Deleted  Mortgage  Loan,  the Discount  Fraction of the
      amount of any shortfall  deposited in the Custodial  Account in connection
      with such substitution);

            (C) in connection with the Cash  Liquidation or REO Disposition of a
      Discount Mortgage Loan (or, with respect to any Mortgage Pool comprised of
      two or more Loan Groups,  each Discount  Mortgage Loan in the related Loan
      Group) that occurred during the preceding calendar month (or was deemed to
      have occurred during such period in accordance with Section  3.07(b)) that
      did not result in any Excess Special  Hazard Losses,  Excess Fraud Losses,
      Excess Bankruptcy  Losses or Extraordinary  Losses, an amount equal to the
      lesser of (1) the  applicable  Discount  Fraction of the Stated  Principal
      Balance  of  such  Discount   Mortgage  Loan  immediately  prior  to  such
      Distribution  Date and (2) the aggregate amount of the collections on such
      Mortgage Loan to the extent applied as recoveries of principal;

            (D) any amounts allocable to principal for any previous Distribution
      Date  (calculated  pursuant  to clauses (A) through (C) above) that remain
      undistributed; and

            (E) the  amount  of any  Class A-P  Collection  Shortfalls  for such
      Distribution  Date and the related  Loan  Group,  if  applicable,  and the
      amount of any Class A-P Collection Shortfalls (for the related Loan Group,
      if applicable)  remaining unpaid for all previous  Distribution Dates, but
      only to the extent of the Eligible Funds for such Distribution Date; minus

            (F)  the   related   Discount   Fraction   of  the  portion  of  the
      Capitalization  Reimbursement  Amount  (for the  related  Loan  Group,  if
      applicable) for such  Distribution  Date, if any, related to each Discount
      Mortgage Loan (in the related Loan Group, if applicable).

      Notwithstanding  the foregoing,  with respect to any Distribution  Date on
and  after  the  Credit  Support   Depletion   Date,  the  Class  A-P  Principal
Distribution  Amount (for a Loan Group, if applicable) shall equal the excess of
(i) the sum of (a) the related  Discount  Fraction of the  principal  portion of
each Monthly Payment on each Discount  Mortgage Loan (in the related Loan Group,
if applicable) received or advanced prior to the related  Determination Date and
not previously  distributed minus the Discount Fraction of the principal portion
of any related Debt  Service  Reduction  which  together  with other  Bankruptcy
Losses exceeds the Bankruptcy  Amount and (b) the related  Discount  Fraction of
the aggregate amount of unscheduled collections described in clauses (B) and (C)
above over (ii) the amount calculated pursuant to clause (F) above.

      Class A-V Certificate:  Any one of the Certificates  designated as a Class
A-V Certificate, including any Subclass thereof.

      Class B Certificate: Any one of the Certificates designated as a Class B-1
Certificate, Class B-2 Certificate or Class B-3 Certificate.

      Class M Certificate: Any one of the Certificates designated as a Class M-1
Certificate, Class M-2 Certificate or Class M-3 Certificate.

                                       9
<PAGE>

      Class P Certificate:  Any one of the Certificates  designated as a Class P
Certificate.

      Class SB Certificate: Any one of the Certificates designated as a Class SB
Certificate.

      Class X Certificate:  Any one of the Certificates  designated as a Class X
Certificate.

      Closing Date: As defined in the Series Supplement.

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

      Combined  Collateral  LLC:  Combined  Collateral  LLC, a Delaware  limited
liability company.

      Commission:  The Securities and Exchange Commission.

      Compensating  Interest:  With respect to any Distribution  Date, an amount
equal to Prepayment Interest Shortfalls resulting from Principal  Prepayments in
Full  during the related  Prepayment  Period and  Curtailments  during the prior
calendar  month and  included  in the  Available  Distribution  Amount  for such
Distribution  Date, but not more than the lesser of (a) one-twelfth of 0.125% of
the Stated Principal  Balance of the Mortgage Loans  immediately  preceding such
Distribution  Date and (b) the sum of the  Servicing Fee and all income and gain
on amounts held in the Custodial Account and the Certificate Account and payable
to the Certificateholders  with respect to such Distribution Date; provided that
for  purposes of this  definition  the amount of the  Servicing  Fee will not be
reduced  pursuant to Section  7.02(a) except as may be required  pursuant to the
last sentence of such Section.

      Compliance  With Laws  Representation:  The following  representation  and
warranty (or any representation and warranty that is substantially similar) made
by Residential Funding in Section 4 of Assignment Agreement: "Each Mortgage Loan
at the time it was made complied in all material respects with applicable local,
state,  and  federal  laws,  including,  but  not  limited  to,  all  applicable
anti-predatory lending laws".

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

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

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

      Cooperative  Loans:  Any  of the  Mortgage  Loans  made  in  respect  of a
Cooperative  Apartment,  evidenced  by a  Mortgage  Note  and  secured  by (i) a
Security Agreement, (ii) the

                                       10
<PAGE>

related  Cooperative Stock  Certificate,  (iii) an assignment of the Cooperative
Lease,  (iv)  financing  statements  and (v) a stock  power  (or  other  similar
instrument),   and  ancillary  thereto,  a  recognition  agreement  between  the
Cooperative  and the  originator  of the  Cooperative  Loan,  each of which  was
transferred  and  assigned to the Trustee  pursuant to Section 2.01 and are from
time to time held as part of the Trust Fund.

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

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

      Credit Repository:  Equifax,  Transunion and Experian, or their successors
in interest.

      Credit Support  Depletion Date: The first  Distribution  Date on which the
Certificate Principal Balances of the Subordinate Certificates have been reduced
to zero.

      Credit Support  Pledge  Agreement:  The Credit  Support Pledge  Agreement,
dated as of November 24, 1998,  among the Master Servicer,  GMAC Mortgage,  LLC,
Combined  Collateral  LLC and The First  National  Bank of Chicago (now known as
Bank One, National Association), as custodian.

      Cumulative Insurance Payments:  As defined in the Series Supplement.

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

      Custodial   Account:   The  custodial  account  or  accounts  created  and
maintained pursuant to Section 3.07 in the name of a depository institution,  as
custodian for the holders of the Certificates,  for the holders of certain other
interests in mortgage loans serviced or sold by the Master  Servicer and for the
Master  Servicer,  into which the  amounts  set forth in  Section  3.07 shall be
deposited directly. Any such account or accounts shall be an Eligible Account.

      Custodial  Agreement:  An  agreement  that may be  entered  into among the
Company, the Master Servicer,  the Trustee and a Custodian pursuant to which the
Custodian will hold certain  documents  relating to the Mortgage Loans on behalf
of the Trustee.

      Custodial  File:  Any mortgage  loan document in the Mortgage File that is
required to be delivered to the Trustee or Custodian pursuant to Section 2.01(b)
of this Agreement.

      Custodian:  A custodian appointed pursuant to a Custodial Agreement.

      Cut-off  Date  Principal  Balance:  As to any  Mortgage  Loan,  the unpaid
principal  balance  thereof  at the  Cut-off  Date  after  giving  effect to all
installments  of principal  due on or prior  thereto (or due during the month of
the Cut-off Date), whether or not received.

      Debt Service Reduction:  With respect to any Mortgage Loan, a reduction in
the  scheduled  Monthly  Payment for such  Mortgage Loan by a court of competent
jurisdiction in a

                                       11
<PAGE>

proceeding  under the Bankruptcy  Code,  except such a reduction  constituting a
Deficient Valuation or any reduction that results in a permanent  forgiveness of
principal.

      Deficient  Valuation:  With respect to any Mortgage Loan, a valuation by a
court of competent jurisdiction of the Mortgaged Property in an amount less than
the then outstanding  indebtedness  under the Mortgage Loan, or any reduction in
the amount of  principal to be paid in  connection  with any  scheduled  Monthly
Payment that constitutes a permanent  forgiveness of principal,  which valuation
or reduction results from a proceeding under the Bankruptcy Code.

      Definitive   Certificate:   Any   Certificate   other  than  a  Book-Entry
Certificate.

      Deleted  Mortgage  Loan: A Mortgage Loan replaced or to be replaced with a
Qualified Substitute Mortgage Loan.

      Delinquent: As used herein, a Mortgage Loan is considered to be: "30 to 59
days" or "30 or more days"  delinquent  when a payment due on any  scheduled due
date  remains  unpaid  as of the  close of  business  on the last  business  day
immediately  prior to the next following  monthly  scheduled due date; "60 to 89
days" or "60 or more days"  delinquent  when a payment due on any  scheduled due
date  remains  unpaid  as of the  close of  business  on the last  business  day
immediately prior to the second following monthly scheduled due date; and so on.
The  determination  as to whether a Mortgage Loan falls into these categories is
made as of the close of business  on the last  business  day of each month.  For
example, a Mortgage Loan with a payment due on July 1 that remained unpaid as of
the close of  business on July 31 would then be  considered  to be 30 to 59 days
delinquent.  Delinquency  information  as of the Cut-off Date is determined  and
prepared as of the close of business on the last business day immediately  prior
to the Cut-off Date.

      Depository:  The  Depository  Trust Company,  or any successor  Depository
hereafter  named.  The  nominee  of  the  initial  Depository  for  purposes  of
registering those Certificates that are to be Book-Entry  Certificates is Cede &
Co. The Depository shall at all times be a "clearing  corporation" as defined in
Section  8-102(a)(5) of the Uniform Commercial Code of the State of New York and
a "clearing agency" registered  pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934, as amended.

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

      Destroyed  Mortgage  Note:  A  Mortgage  Note the  original  of which  was
permanently lost or destroyed and has not been replaced.

      Destroyed  Obligation  to Pay: An  Obligation to Pay the original of which
was permanently lost or destroyed and has not been replaced.

      Determination Date: As defined in the Series Supplement.

      Discount  Fraction:  With  respect to each  Discount  Mortgage  Loan,  the
fraction  expressed as a percentage,  the numerator of which is the Discount Net
Mortgage Rate minus the Net

                                       12
<PAGE>

Mortgage  Rate (or the initial Net  Mortgage  Rate with  respect to any Discount
Mortgage  Loans as to which the Mortgage  Rate is modified  pursuant to 3.07(a))
for such Mortgage Loan and the denominator of which is the Discount Net Mortgage
Rate. The Discount  Fraction with respect to each Discount  Mortgage Loan is set
forth as an exhibit attached to the Series Supplement.

      Discount  Mortgage  Loan: Any Mortgage Loan having a Net Mortgage Rate (or
the initial Net Mortgage  Rate) of less than the Discount Net Mortgage  Rate per
annum and any Mortgage  Loan deemed to be a Discount  Mortgage  Loan pursuant to
the definition of Qualified Substitute Mortgage Loan.

      Discount Net Mortgage Rate:  As defined in the Series Supplement.

      Disqualified  Organization:  Any  organization  defined as a "disqualified
organization"  under  Section  860E(e)(5)  of the  Code,  and  if not  otherwise
included,  any of the following:  (i) the United States,  any State or political
subdivision  thereof,  any  possession  of the United  States,  or any agency or
instrumentality of any of the foregoing (other than an instrumentality  which is
a  corporation  if all of its  activities  are  subject  to tax and,  except for
Freddie  Mac, a  majority  of its board of  directors  is not  selected  by such
governmental unit), (ii) a foreign government,  any international  organization,
or any agency or instrumentality of any of the foregoing, (iii) any organization
(other than certain farmers' cooperatives  described in Section 521 of the Code)
which is exempt from the tax imposed by Chapter 1 of the Code (including the tax
imposed by Section 511 of the Code on unrelated  business taxable income),  (iv)
rural electric and telephone  cooperatives described in Section 1381(a)(2)(C) of
the Code, (v) any "electing large  partnership," as defined in Section 775(a) of
the Code and (vi) any other Person so  designated  by the Trustee  based upon an
Opinion  of  Counsel  that the  holding of an  Ownership  Interest  in a Class R
Certificate  by such  Person may cause the Trust  Fund or any  Person  having an
Ownership  Interest in any Class of  Certificates  (other  than such  Person) to
incur a liability  for any  federal  tax  imposed  under the Code that would not
otherwise be imposed but for the Transfer of an Ownership  Interest in a Class R
Certificate   to  such  Person.   The  terms   "United   States",   "State"  and
"international  organization"  shall have the meanings set forth in Section 7701
of the Code or successor provisions.

      Distribution  Date:  The  25th day of any  month  beginning  in the  month
immediately  following the month of the initial issuance of the Certificates or,
if such 25th day is not a Business Day, the Business Day  immediately  following
such 25th day.

      Due Date: With respect to any Distribution Date and any Mortgage Loan, the
day during the related Due Period on which the Monthly Payment is due.

      Due Period:  With respect to any  Distribution  Date, the one-month period
set forth in the Series Supplement.

      Eligible Account: An account that is any of the following:  (i) maintained
with a depository  institution the debt  obligations of which have been rated by
each  Rating  Agency in its  highest  rating  available,  or (ii) an  account or
accounts in a depository institution in which such accounts are fully insured to
the limits  established  by the FDIC,  provided that any deposits not so insured
shall, to the extent  acceptable to each Rating Agency, as evidenced in writing,
be

                                       13
<PAGE>

maintained  such that (as  evidenced  by an Opinion of Counsel  delivered to the
Trustee and each Rating Agency) the registered  Holders of  Certificates  have a
claim with  respect to the funds in such account or a perfected  first  security
interest   against  any   collateral   (which  shall  be  limited  to  Permitted
Investments)  securing  such  funds  that is  superior  to  claims  of any other
depositors or creditors of the depository institution with which such account is
maintained,  or (iii) in the case of the Custodial  Account,  a trust account or
accounts maintained in the corporate trust department of the Trustee, or (iv) in
the case of the Certificate  Account, a trust account or accounts  maintained in
the corporate trust department of the Trustee,  or (v) an account or accounts of
a  depository  institution  acceptable  to each Rating  Agency (as  evidenced in
writing by each  Rating  Agency  that use of any such  account as the  Custodial
Account or the  Certificate  Account will not reduce the rating  assigned to any
Class of  Certificates  by such  Rating  Agency  below the  then-current  rating
assigned to such Certificates).

      Event of Default:  As defined in Section 7.01.

      Excess  Bankruptcy Loss: Any Bankruptcy  Loss, or portion  thereof,  which
exceeds the then applicable Bankruptcy Amount.

      Excess Fraud Loss: Any Fraud Loss, or portion  thereof,  which exceeds the
then applicable Fraud Loss Amount.

      Excess Special  Hazard Loss: Any Special Hazard Loss, or portion  thereof,
that exceeds the then applicable Special Hazard Amount.

      Excess Subordinate Principal Amount: With respect to any Distribution Date
on which the aggregate Certificate Principal Balance of the Class of Subordinate
Certificates  then outstanding with the Lowest Priority is to be reduced to zero
and on which Realized  Losses are to be allocated to such class or classes,  the
excess,  if any,  of (i) the amount that would  otherwise  be  distributable  in
respect  of  principal  on  such  class  or  classes  of  Certificates  on  such
Distribution  Date over (ii) the excess,  if any, of the  aggregate  Certificate
Principal Balance of such class or classes of Certificates  immediately prior to
such  Distribution  Date  over the  aggregate  amount of  Realized  Losses to be
allocated to such classes of Certificates on such  Distribution  Date as reduced
by any amount  calculated  pursuant to clause (E) of the definition of Class A-P
Principal  Distribution  Amount.  With  respect  to any  Mortgage  Pool  that is
comprised of two or more Loan Groups,  the Excess  Subordinate  Principal Amount
will be allocated between each Loan Group on a pro rata basis in accordance with
the amount of Realized  Losses  attributable to each Loan Group and allocated to
the Certificates on such Distribution Date.

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

      Extraordinary  Events:  Any of the following  conditions with respect to a
Mortgaged  Property  (or, with respect to a Cooperative  Loan,  the  Cooperative
Apartment)  or Mortgage  Loan  causing or  resulting  in a loss which causes the
liquidation of such Mortgage Loan:

            (a)  losses  that  are of the type  that  would  be  covered  by the
      fidelity bond and the errors and omissions insurance policy required to be
      maintained  pursuant to Section  3.12(b) but are in excess of the coverage
      maintained thereunder;

                                       14
<PAGE>

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

            (c)  hostile  or warlike  action in time of peace or war,  including
      action in hindering,  combating or defending against an actual,  impending
      or expected attack:

                  1. by any government or sovereign  power, de jure or de facto,
            or by any  authority  maintaining  or using  military,  naval or air
            forces; or

                  2. by military, naval or air forces; or

                  3. by an agent of any such  government,  power,  authority  or
            forces;

            (d) any weapon of war employing atomic fission or radioactive  force
      whether in time of peace or war; or

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

      Extraordinary  Losses:  Any loss  incurred on a Mortgage Loan caused by or
resulting from an Extraordinary Event.

      Fannie Mae: Federal National Mortgage  Association,  a federally chartered
and  privately  owned  corporation  organized  and  existing  under the  Federal
National Mortgage Association Charter Act, or any successor thereto.

      FDIC:  Federal Deposit Insurance Corporation or any successor thereto.

      Final  Distribution  Date:  The  Distribution  Date  on  which  the  final
distribution  in respect of the  Certificates  will be made  pursuant to Section
9.01, which Final  Distribution  Date shall in no event be later than the end of
the 90-day liquidation period described in Section 9.02.

      Fitch:  Fitch Ratings or its successor in interest.

      Foreclosure Profits: As to any Distribution Date or related  Determination
Date and any  Mortgage  Loan,  the  excess,  if any,  of  Liquidation  Proceeds,
Insurance Proceeds and REO Proceeds (net of all amounts  reimbursable  therefrom
pursuant  to  Section  3.10(a)(ii))  in  respect  of each  Mortgage  Loan or REO
Property for which a Cash Liquidation or REO Disposition occurred in the related
Prepayment  Period over the sum of the unpaid principal balance of such Mortgage
Loan  or REO  Property  (determined,  in the  case  of an  REO  Disposition,  in
accordance  with Section 3.14) plus accrued and unpaid  interest at the Mortgage
Rate on such unpaid  principal  balance from the Due Date to which  interest was
last paid by the Mortgagor to the first

                                       15
<PAGE>

day of the month  following  the month in which  such  Cash  Liquidation  or REO
Disposition occurred.

      Form 10-K Certification:  As defined in Section 4.03(e).

      Fraud  Losses:  Realized  Losses on  Mortgage  Loans as to which there was
fraud in the origination of such Mortgage Loan.

      Freddie  Mac:  Federal  Home  Loan  Mortgage   Corporation,   a  corporate
instrumentality of the United States created and existing under Title III of the
Emergency Home Finance Act of 1970, as amended, or any successor thereto.

      Highest  Priority:  As  of  any  date  of  determination,   the  Class  of
Subordinate  Certificates then outstanding with a Certificate  Principal Balance
greater than zero, with the earliest  priority for payments  pursuant to Section
4.02(a),  in the following  order:  Class M-1,  Class M-2, Class M-3, Class B-1,
Class B-2 and Class B-3 Certificates.

      Independent:  When used with respect to any specified Person, means such a
Person who (i) is in fact  independent of the Company,  the Master  Servicer and
the Trustee,  or any Affiliate thereof,  (ii) does not have any direct financial
interest or any material indirect financial interest in the Company,  the Master
Servicer or the Trustee or in an Affiliate  thereof,  and (iii) is not connected
with the Company,  the Master  Servicer or the Trustee as an officer,  employee,
promoter,  underwriter,  trustee, partner, director or person performing similar
functions.

      Initial  Certificate  Principal  Balance:  With  respect  to each Class of
Certificates, the Certificate Principal Balance of such Class of Certificates as
of the Cut-off Date, as set forth in the Series Supplement.

      Initial Monthly Payment Fund: An amount  representing  scheduled principal
amortization and interest at the Net Mortgage Rate for the Due Date in the first
Due Period  commencing  subsequent to the Cut-off Date for those  Mortgage Loans
for which the Trustee will not be entitled to receive such payment,  and as more
specifically defined in the Series Supplement.

      Initial Notional Amount: With respect to any Class or Subclass of Interest
Only  Certificates,  the amount  initially  used as the principal  basis for the
calculation of any interest payment amount, as more specifically  defined in the
Series Supplement.

      Initial Subordinate Class Percentage: As defined in the Series Supplement.

      Insurance  Proceeds:  Proceeds  paid  in  respect  of the  Mortgage  Loans
pursuant to any Primary  Insurance Policy or any other related  insurance policy
covering a Mortgage Loan  (excluding any  Certificate  Policy (as defined in the
Series  Supplement)),  to the extent such  proceeds are payable to the mortgagee
under the Mortgage, any Subservicer,  the Master Servicer or the Trustee and are
not applied to the  restoration  of the related  Mortgaged  Property  (or,  with
respect to a Cooperative Loan, the related Cooperative Apartment) or released to
the Mortgagor in accordance  with the procedures  that the Master Servicer would
follow in servicing mortgage loans held for its own account.

                                       16
<PAGE>

      Insurer:  Any named  insurer  under any  Primary  Insurance  Policy or any
successor thereto or the named insurer in any replacement policy.

      Interest Accrual Period: As defined in the Series Supplement.

      Interest  Only  Certificates:  A Class or  Subclass  of  Certificates  not
entitled  to  payments  of  principal,  and  designated  as such  in the  Series
Supplement.  The Interest Only Certificates  will have no Certificate  Principal
Balance.

      Interim Certification:  As defined in Section 2.02.

      International  Borrower:  In connection with any Mortgage Loan, a borrower
who  is (a) a  United  States  citizen  employed  in a  foreign  country,  (b) a
non-permanent resident alien employed in the United States or (c) a citizen of a
country  other than the United States with income  derived from sources  outside
the United States.

      Junior  Certificateholder:  The  Holder  of  not  less  than  95%  of  the
Percentage Interests of the Junior Class of Certificates.

      Junior  Class  of  Certificates:  The  Class of  Subordinate  Certificates
outstanding  as of the date of the  repurchase  of a Mortgage  Loan  pursuant to
Section 4.07 herein that has the Lowest Priority.

      Late Collections:  With respect to any Mortgage Loan, all amounts received
during any Due  Period,  whether as late  payments  of  Monthly  Payments  or as
Insurance  Proceeds,  Liquidation  Proceeds or otherwise,  which  represent late
payments or  collections  of Monthly  Payments due but delinquent for a previous
Due Period and not previously recovered.

      Liquidation Proceeds:  Amounts (other than Insurance Proceeds) received by
the  Master  Servicer  in  connection  with the  taking of an  entire  Mortgaged
Property  by  exercise  of the power of  eminent  domain or  condemnation  or in
connection with the liquidation of a defaulted  Mortgage Loan through  trustee's
sale, foreclosure sale or otherwise, other than REO Proceeds.

      Loan Group:  Any group of Mortgage  Loans  designated  as a separate  loan
group in the Series  Supplement.  The  Certificates  relating to each Loan Group
will be designated in the Series Supplement.

      Loan-to-Value  Ratio:  As  of  any  date,  the  fraction,  expressed  as a
percentage,  the  numerator  of which is the  current  principal  balance of the
related Mortgage Loan at the date of determination  and the denominator of which
is the Appraised Value of the related Mortgaged Property.

      Lower  Priority:  As of  any  date  of  determination  and  any  Class  of
Subordinate  Certificates,  any other  Class of  Subordinate  Certificates  then
outstanding with a later priority for payments pursuant to Section 4.02 (a).

      Lowest Priority: As of any date of determination, the Class of Subordinate
Certificates then outstanding with a Certificate  Principal Balance greater than
zero, with the latest priority for

                                       17
<PAGE>

payments pursuant to Section 4.02(a),  in the following order:  Class B-3, Class
B-2, Class B-1, Class M-3, Class M-2 and Class M-1 Certificates.

      Maturity Date: The latest possible  maturity date,  solely for purposes of
Section   1.860G-1(a)(4)(iii)   of  the  Treasury  regulations,   by  which  the
Certificate  Principal  Balance of each Class of  Certificates  (other  than the
Interest Only Certificates which have no Certificate Principal Balance) and each
Uncertificated REMIC Regular Interest would be reduced to zero, as designated in
the Series Supplement.

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

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

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

      MLCC:  Merrill Lynch Credit Corporation, or its successor in interest.

      Modified  Mortgage  Loan: Any Mortgage Loan that has been the subject of a
Servicing Modification.

      Modified Net Mortgage Rate: As to any Mortgage Loan that is the subject of
a  Servicing  Modification,  the Net  Mortgage  Rate minus the rate per annum by
which the Mortgage Rate on such Mortgage Loan was reduced.

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

      Monthly  Payment:  With respect to any Mortgage  Loan  (including  any REO
Property) and any Due Date, the payment of principal and interest due thereon in
accordance with the amortization  schedule at the time applicable thereto (after
adjustment,  if any, for  Curtailments  and for Deficient  Valuations  occurring
prior to such Due Date but before any adjustment to such  amortization  schedule
by reason of any  bankruptcy,  other  than a  Deficient  Valuation,  or  similar
proceeding or any  moratorium  or similar  waiver or grace period and before any
Servicing Modification that constitutes a reduction of the interest rate on such
Mortgage Loan).

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

      Mortgage:  With respect to each  Mortgage  Note related to a Mortgage Loan
which is not a Cooperative Loan, the mortgage, deed of trust or other comparable
instrument  creating  a first  lien on an  estate  in fee  simple  or  leasehold
interest  in real  property  securing  a  Mortgage  Note.  With  respect to each
Obligation to Pay related to a Sharia  Mortgage Loan,  the Sharia  Mortgage Loan
Security Instrument.

                                       18
<PAGE>

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

      Mortgage Loans: Such of the mortgage loans,  including any Sharia Mortgage
Loans,  transferred and assigned to the Trustee pursuant to Section 2.01 as from
time to time are held or  deemed  to be held as a part of the  Trust  Fund,  the
Mortgage Loans  originally so held being identified in the initial Mortgage Loan
Schedule, and Qualified Substitute Mortgage Loans held or deemed held as part of
the  Trust  Fund  including,  without  limitation,  (i)  with  respect  to  each
Cooperative Loan, the related Mortgage Note, Security  Agreement,  Assignment of
Proprietary Lease, Cooperative Stock Certificate, Cooperative Lease and Mortgage
File and all rights  appertaining  thereto,  (ii) with  respect  to each  Sharia
Mortgage  Loan,  the related  Obligation to Pay,  Sharia  Mortgage Loan Security
Instrument,  Sharia Mortgage Loan Co-Ownership  Agreement,  Assignment Agreement
and  Amendment  of  Security   Instrument  and  Mortgage  File  and  all  rights
appertaining  thereto and (iii) with respect to each  Mortgage Loan other than a
Cooperative Loan or a Sharia Mortgage Loan, each related Mortgage Note, Mortgage
and Mortgage File and all rights appertaining thereto.

      Mortgage Loan Schedule:  As defined in the Series Supplement.

      Mortgage  Note:  The  originally   executed  note  or  other  evidence  of
indebtedness  evidencing the  indebtedness of a Mortgagor under a Mortgage Loan,
together with any  modification  thereto.  With respect to each Sharia  Mortgage
Loan, the related Obligation to Pay.

      Mortgage Pool: The pool of mortgage loans,  including all Loan Groups,  if
any, consisting of the Mortgage Loans.

      Mortgage  Rate:  As to any Mortgage  Loan,  the interest rate borne by the
related  Mortgage  Note,  or any  modification  thereto  other than a  Servicing
Modification. As to any Sharia Mortgage Loan, the profit factor described in the
related  Obligation to Pay, or any  modification  thereto other than a Servicing
Modification.

      Mortgaged Property:  The underlying real property securing a Mortgage Loan
or,  with  respect to a  Cooperative  Loan,  the related  Cooperative  Lease and
Cooperative Stock.

      Mortgagor:  The obligor on a Mortgage  Note,  or with  respect to a Sharia
Mortgage Loan, the consumer on an Obligation to Pay.

      Net Mortgage  Rate: As to each Mortgage Loan, a per annum rate of interest
equal to the  Adjusted  Mortgage  Rate  less  the per  annum  rate at which  the
Servicing Fee is calculated.

      Non-Discount  Mortgage  Loan:  A  Mortgage  Loan  that  is not a  Discount
Mortgage Loan.

      Non-Primary  Residence  Loans: The Mortgage Loans designated as secured by
second or vacation  residences,  or by  non-owner  occupied  residences,  on the
Mortgage Loan Schedule.

      Non-United States Person:  Any Person other than a United States Person.

                                       19
<PAGE>

      Nonrecoverable Advance: Any Advance previously made or proposed to be made
by the Master  Servicer or Subservicer in respect of a Mortgage Loan (other than
a Deleted  Mortgage  Loan)  which,  in the good  faith  judgment  of the  Master
Servicer,  will not,  or,  in the case of a  proposed  Advance,  would  not,  be
ultimately  recoverable  by the Master  Servicer from related Late  Collections,
Insurance Proceeds,  Liquidation Proceeds,  REO Proceeds or amounts reimbursable
to the Master Servicer  pursuant to Section  4.02(a) hereof.  To the extent that
any Mortgagor is not obligated  under the related  Mortgage  documents to pay or
reimburse  any  portion of any  Servicing  Advances  that are  outstanding  with
respect  to the  related  Mortgage  Loan as a result of a  modification  of such
Mortgage Loan by the Master  Servicer,  which forgives  amounts which the Master
Servicer  or  Subservicer  had  previously  advanced,  and the  Master  Servicer
determines that no other source of payment or reimbursement for such advances is
available to it, such Servicing  Advances  shall be deemed to be  Nonrecoverable
Advances.  The  determination  by  the  Master  Servicer  that  it  has  made  a
Nonrecoverable   Advance  or  that  any  proposed  Advance  would  constitute  a
Nonrecoverable Advance, shall be evidenced by an Officers' Certificate delivered
to the Company, the Trustee and any Certificate Insurer.

      Nonsubserviced  Mortgage  Loan:  Any  Mortgage  Loan that,  at the time of
reference thereto, is not subject to a Subservicing Agreement.

      Notional  Amount:  With respect to any Class or Subclass of Interest  Only
Certificates,  an amount used as the principal  basis for the calculation of any
interest payment amount, as more specifically defined in the Series Supplement.

      Obligation to Pay: The  originally  executed  obligation to pay or similar
agreement  evidencing  the  obligation of the consumer  under a Sharia  Mortgage
Loan, together with any modification thereto.

      Officers' Certificate:  A certificate signed by the Chairman of the Board,
the President or a Vice President or Assistant Vice President,  or a Director or
Managing Director, and by the Treasurer,  the Secretary, or one of the Assistant
Treasurers or Assistant  Secretaries of the Company or the Master  Servicer,  as
the case may be, and delivered to the Trustee, as required by this Agreement.

      Opinion of Counsel: A written opinion of counsel acceptable to the Trustee
and the  Master  Servicer,  who may be  counsel  for the  Company  or the Master
Servicer, provided that any opinion of counsel (i) referred to in the definition
of  "Disqualified  Organization"  or (ii) relating to the  qualification  of any
REMIC formed under the Series Supplement or compliance with the REMIC Provisions
must, unless otherwise specified, be an opinion of Independent counsel.

      Outstanding  Mortgage Loan: As to any Due Date, a Mortgage Loan (including
an REO  Property)  which was not the subject of a Principal  Prepayment in Full,
Cash  Liquidation or REO  Disposition  and which was not  purchased,  deleted or
substituted  for prior to such Due Date pursuant to Section 2.02,  2.03, 2.04 or
4.07.

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

                                       20
<PAGE>

      Pass-Through Rate:  As defined in the Series Supplement.

      Paying Agent:  The Trustee or any successor  Paying Agent appointed by the
Trustee.

      Percentage Interest: With respect to any Certificate (other than a Class R
Certificate),  the undivided  percentage ownership interest in the related Class
evidenced by such  Certificate,  which  percentage  ownership  interest shall be
equal to the Initial  Certificate  Principal Balance thereof or Initial Notional
Amount (in the case of any Interest  Only  Certificate)  thereof  divided by the
aggregate Initial Certificate  Principal Balance or the aggregate of the Initial
Notional Amounts, as applicable, of all the Certificates of the same Class. With
respect to a Class R Certificate,  the interest in distributions to be made with
respect to such Class evidenced thereby, expressed as a percentage, as stated on
the face of each such Certificate.

      Permitted Investments:  One or more of the following:

            (i)  obligations  of or guaranteed as to timely payment of principal
      and interest by the United States or any agency or instrumentality thereof
      when  such  obligations  are  backed by the full  faith and  credit of the
      United States;

            (ii)  repurchase  agreements on obligations  specified in clause (i)
      maturing  not more than one month  from the date of  acquisition  thereof,
      provided  that the  unsecured  short-term  debt  obligations  of the party
      agreeing  to  repurchase  such  obligations  are at the time rated by each
      Rating Agency in its highest short-term rating available;

            (iii) federal funds,  certificates of deposit, demand deposits, time
      deposits  and  bankers'  acceptances  (which  shall each have an  original
      maturity  of  not  more  than  90  days  and,  in  the  case  of  bankers'
      acceptances,  shall in no event have an original maturity of more than 365
      days or a remaining  maturity of more than 30 days)  denominated in United
      States  dollars  of any  U.S.  depository  institution  or  trust  company
      incorporated  under the laws of the United  States or any state thereof or
      of any  domestic  branch  of a  foreign  depository  institution  or trust
      company; provided that the debt obligations of such depository institution
      or trust  company at the date of  acquisition  thereof  have been rated by
      each  Rating  Agency in its  highest  short-term  rating  available;  and,
      provided  further  that,  if the  original  maturity  of  such  short-term
      obligations of a domestic  branch of a foreign  depository  institution or
      trust  company  shall  exceed  30  days,  the  short-term  rating  of such
      institution  shall be A-1+ in the case of  Standard & Poor's if Standard &
      Poor's is a Rating Agency;

            (iv) commercial paper and demand notes (having  original  maturities
      of not more than 365 days) of any corporation  incorporated under the laws
      of the United States or any state thereof which on the date of acquisition
      has been rated by each  Rating  Agency in its  highest  short-term  rating
      available;  provided  that such  commercial  paper  shall have a remaining
      maturity of not more than 30 days;

            (v) any mutual fund,  money market fund,  common trust fund or other
      pooled investment vehicle,  the assets of which are limited to instruments
      that otherwise would constitute Permitted  Investments  hereunder and have
      been  rated  by  each  Rating  Agency  in its  highest  short-term  rating
      available (in the case of Standard & Poor's such rating

                                       21
<PAGE>

      shall be either AAAm or AAAm-G),  including  any such fund that is managed
      by the Trustee or any affiliate of the Trustee or for which the Trustee or
      any of its affiliates acts as an adviser; and

            (vi) other  obligations  or securities  that are  acceptable to each
      Rating Agency as a Permitted  Investment hereunder and will not reduce the
      rating  assigned  to any  Class  of  Certificates  by such  Rating  Agency
      (without giving effect to any Certificate Policy (as defined in the Series
      Supplement) in the case of Insured  Certificates (as defined in the Series
      Supplement)  below the lower of the  then-current  rating assigned to such
      Certificates by such Rating Agency, as evidenced in writing;

provided,  however,  no  instrument  shall  be  a  Permitted  Investment  if  it
represents,  either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest  payments derived from  obligations  underlying such instrument and the
principal and interest payments with respect to such instrument  provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations.  References  herein to the highest  rating  available  on unsecured
long-term debt shall mean AAA in the case of Standard & Poor's and Fitch and Aaa
in the case of Moody's,  and for  purposes  of this  Agreement,  any  references
herein  to the  highest  rating  available  on  unsecured  commercial  paper and
short-term  debt  obligations  shall  mean  the  following:  A-1 in the  case of
Standard  &  Poor's,  P-1 in the case of  Moody's  and F-1 in the case of Fitch;
provided,  however,  that any  Permitted  Investment  that is a short-term  debt
obligation rated A-1 by Standard & Poor's must satisfy the following  additional
conditions: (i) the total amount of debt from A-1 issuers must be limited to the
investment of monthly principal and interest payments (assuming fully amortizing
collateral);  (ii) the total amount of A-1  investments  must not represent more
than 20% of the  aggregate  outstanding  Certificate  Principal  Balance  of the
Certificates and each investment must not mature beyond 30 days; (iii) the terms
of the debt must have a  predetermined  fixed dollar  amount of principal due at
maturity that cannot vary; and (iv) if the investments  may be liquidated  prior
to their maturity or are being relied on to meet a certain yield,  interest must
be tied to a single  interest rate index plus a single fixed spread (if any) and
must move  proportionately with that index. Any Permitted Investment may be held
by or through the Trustee or its Affiliates.

      Permitted Transferee: Any Transferee of a Class R Certificate,  other than
a Disqualified Organization or Non-United States Person.

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

      Pledged  Amount:  With  respect to any Pledged  Asset Loan,  the amount of
money  remitted  to Combined  Collateral  LLC,  at the  direction  of or for the
benefit of the related Mortgagor.

      Pledged Asset Loan:  Any Mortgage Loan supported by Pledged Assets or such
other collateral,  other than the related Mortgaged  Property,  set forth in the
Series Supplement.

      Pledged Assets: With respect to any Mortgage Loan, all money,  securities,
security  entitlements,  accounts,  general  intangibles,  payment  intangibles,
instruments, documents, deposit

                                       22
<PAGE>

accounts,  certificates of deposit,  commodities  contracts and other investment
property and other property of whatever kind or description  pledged by Combined
Collateral LLC as security in respect of any Realized  Losses in connection with
such Mortgage  Loan up to the Pledged  Amount for such  Mortgage  Loan,  and any
related  collateral,  or such other collateral as may be set forth in the Series
Supplement.

      Pledged Asset  Mortgage  Servicing  Agreement:  The Pledged Asset Mortgage
Servicing  Agreement,  dated as of February 28, 1996 between MLCC and the Master
Servicer.

      Pooling and Servicing Agreement or Agreement:  With respect to any Series,
this Standard Terms together with the related Series Supplement.

      Pool Stated Principal Balance:  As to any Distribution Date, the aggregate
of the Stated Principal Balances of each Mortgage Loan.

      Pool Strip Rate:  With  respect to each  Mortgage  Loan,  a per annum rate
equal to the excess of (a) the Net Mortgage  Rate of such Mortgage Loan over (b)
the Discount Net Mortgage Rate (but not less than 0.00%) per annum.

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

      Prepayment  Interest  Shortfall:  As to  any  Distribution  Date  and  any
Mortgage Loan (other than a Mortgage Loan relating to an REO Property)  that was
the  subject of (a) a  Principal  Prepayment  in Full  during the portion of the
related  Prepayment Period that falls during the prior calendar month, an amount
equal  to the  excess  of one  month's  interest  at the Net  Mortgage  Rate (or
Modified  Net  Mortgage  Rate in the case of a  Modified  Mortgage  Loan) on the
Stated  Principal  Balance of such  Mortgage  Loan over the  amount of  interest
(adjusted to the Net Mortgage Rate (or Modified Net Mortgage Rate in the case of
a Modified  Mortgage  Loan)) paid by the Mortgagor for such month to the date of
such Principal Prepayment in Full or (b) a Curtailment during the prior calendar
month,  an amount  equal to one month's  interest at the Net  Mortgage  Rate (or
Modified  Net  Mortgage  Rate in the case of a  Modified  Mortgage  Loan) on the
amount of such Curtailment.

      Prepayment Period: As to any Distribution Date and Principal Prepayment in
Full,  the period  commencing on the 16th day of the month prior to the month in
which that  Distribution  Date occurs and ending on the 15th day of the month in
which such Distribution Date occurs.

      Primary  Insurance  Policy:  Each  primary  policy  of  mortgage  guaranty
insurance or any replacement policy therefor referred to in Section  2.03(b)(iv)
and (v).

                                       23
<PAGE>

      Principal  Only  Certificates:  A Class of  Certificates  not  entitled to
payments of interest,  and more  specifically  designated  as such in the Series
Supplement.

      Principal  Prepayment:  Any payment of  principal  or other  recovery on a
Mortgage Loan,  including a recovery that takes the form of Liquidation Proceeds
or Insurance  Proceeds,  which is received in advance of its  scheduled Due Date
and is not  accompanied  by an  amount  as to  interest  representing  scheduled
interest  on such  payment  due on any  date or dates  in any  month  or  months
subsequent to the month of prepayment.

      Principal  Prepayment  in Full:  Any  Principal  Prepayment  of the entire
principal balance of a Mortgage Loan that is made by the Mortgagor.

      Program Guide:  Collectively,  the Client Guide and the Servicer Guide for
Residential Funding's Expanded Criteria Mortgage Program.

      Purchase  Price:  With  respect  to any  Mortgage  Loan (or REO  Property)
required to be or  otherwise  purchased  on any date  pursuant to Section  2.02,
2.03,  2.04 or  4.07,  an  amount  equal  to the sum of (i)  100% of the  Stated
Principal Balance thereof plus the principal portion of any related unreimbursed
Advances  and (ii) unpaid  accrued  interest at the Adjusted  Mortgage  Rate (or
Modified Net Mortgage Rate plus the rate per annum at which the Servicing Fee is
calculated in the case of a Modified Mortgage Loan) (or at the Net Mortgage Rate
(or Modified Net Mortgage Rate in the case of a Modified  Mortgage  Loan) in the
case of a purchase made by the Master Servicer) on the Stated Principal  Balance
thereof  to the Due Date in the Due  Period  related  to the  Distribution  Date
occurring  in the month  following  the month of  purchase  from the Due Date to
which interest was last paid by the Mortgagor.

      Qualified  Substitute  Mortgage  Loan:  A  Mortgage  Loan  substituted  by
Residential  Funding or the Company for a Deleted  Mortgage  Loan which must, on
the  date  of  such  substitution,  as  confirmed  in an  Officers'  Certificate
delivered to the Trustee, with a copy to the Custodian,

      (i)   have  an  outstanding  principal  balance,  after  deduction  of the
            principal  portion  of the  monthly  payment  due in  the  month  of
            substitution  (or in the  case of a  substitution  of more  than one
            Mortgage Loan for a Deleted Mortgage Loan, an aggregate  outstanding
            principal  balance,  after  such  deduction),  not in  excess of the
            Stated Principal Balance of the Deleted Mortgage Loan (the amount of
            any  shortfall  to  be  deposited  by  Residential  Funding  in  the
            Custodial Account in the month of substitution);

      (ii)  have a Mortgage  Rate and a Net Mortgage  Rate no lower than and not
            more  than 1% per  annum  higher  than  the  Mortgage  Rate  and Net
            Mortgage Rate, respectively,  of the Deleted Mortgage Loan as of the
            date of substitution;

      (iii) have a  Loan-to-Value  Ratio at the time of  substitution  no higher
            than that of the Deleted Mortgage Loan at the time of substitution;

      (iv)  have a remaining  term to stated  maturity not greater than (and not
            more than one year less than) that of the Deleted Mortgage Loan;

                                       24
<PAGE>

      (v)   comply with each  representation  and warranty set forth in Sections
            2.03 and 2.04 hereof and Section 4 of the Assignment Agreement; and

      (vi)  have a Pool Strip Rate equal to or greater  than that of the Deleted
            Mortgage Loan.

Notwithstanding  any other provisions  herein, (x) with respect to any Qualified
Substitute  Mortgage Loan  substituted  for a Deleted  Mortgage Loan which was a
Discount Mortgage Loan, such Qualified  Substitute Mortgage Loan shall be deemed
to be a  Discount  Mortgage  Loan and to have a Discount  Fraction  equal to the
Discount  Fraction  of the Deleted  Mortgage  Loan and (y) in the event that the
"Pool  Strip  Rate" of any  Qualified  Substitute  Mortgage  Loan as  calculated
pursuant to the  definition  of "Pool Strip Rate" is greater than the Pool Strip
Rate of the related Deleted Mortgage Loan

      (i)   the Pool Strip Rate of such Qualified Substitute Mortgage Loan shall
            be equal to the Pool Strip Rate of the related Deleted Mortgage Loan
            for purposes of calculating the  Pass-Through  Rate on the Class A-V
            Certificates and

      (ii)  the  excess  of the Pool  Strip  Rate on such  Qualified  Substitute
            Mortgage  Loan as  calculated  pursuant to the  definition  of "Pool
            Strip Rate" over the Pool Strip Rate on the related Deleted Mortgage
            Loan  shall be  payable  to the  Class R  Certificates  pursuant  to
            Section 4.02 hereof.

      Rating Agency: Each of the statistical credit rating agencies specified in
the Preliminary Statement of the Series Supplement. If any agency or a successor
is no longer in  existence,  "Rating  Agency" shall be such  statistical  credit
rating agency, or other comparable Person,  designated by the Company, notice of
which designation shall be given to the Trustee and the Master Servicer.

      Realized Loss:  With respect to each Mortgage Loan (or REO Property):

      (a)   as to which a Cash  Liquidation or REO Disposition has occurred,  an
            amount  (not  less  than  zero)  equal to (i) the  Stated  Principal
            Balance of the  Mortgage  Loan (or REO  Property)  as of the date of
            Cash  Liquidation  or REO  Disposition,  plus (ii) interest (and REO
            Imputed Interest, if any) at the Net Mortgage Rate from the Due Date
            as to which interest was last paid or advanced to Certificateholders
            up to the Due Date in the Due  Period  related  to the  Distribution
            Date on which  such  Realized  Loss will be  allocated  pursuant  to
            Section 4.05 on the Stated  Principal  Balance of such Mortgage Loan
            (or REO  Property)  outstanding  during  each Due  Period  that such
            interest was not paid or advanced, minus (iii) the proceeds, if any,
            received  during  the month in which such Cash  Liquidation  (or REO
            Disposition)  occurred,  to the  extent  applied  as  recoveries  of
            interest at the Net  Mortgage  Rate and to principal of the Mortgage
            Loan, net of the portion thereof reimbursable to the Master Servicer
            or any  Subservicer  with  respect  to related  Advances,  Servicing
            Advances  or other  expenses  as to which  the  Master  Servicer  or
            Subservicer is entitled to  reimbursement  thereunder but which have
            not been previously reimbursed,

                                       25
<PAGE>

      (b)   which is the subject of a Servicing Modification, (i) (1) the amount
            by which the interest  portion of a Monthly Payment or the principal
            balance  of such  Mortgage  Loan was  reduced  or (2) the sum of any
            other  amounts  owing under the Mortgage Loan that were forgiven and
            that  constitute  Servicing  Advances that are  reimbursable  to the
            Master  Servicer  or a  Subservicer,  and (ii) any such  amount with
            respect to a Monthly  Payment that was or would have been due in the
            month   immediately   following  the  month  in  which  a  Principal
            Prepayment  or the Purchase  Price of such Mortgage Loan is received
            or is deemed to have been received,

      (c)   which  has  become  the  subject  of  a  Deficient  Valuation,   the
            difference  between  the  principal  balance  of the  Mortgage  Loan
            outstanding  immediately  prior to such Deficient  Valuation and the
            principal  balance of the Mortgage  Loan as reduced by the Deficient
            Valuation, or

      (d)   which has become the object of a Debt Service Reduction,  the amount
            of such Debt Service Reduction.

Notwithstanding  the above,  neither a Deficient  Valuation  nor a Debt  Service
Reduction  shall be  deemed a  Realized  Loss  hereunder  so long as the  Master
Servicer  has  notified  the  Trustee in writing  that the  Master  Servicer  is
diligently  pursuing  any  remedies  that  may  exist  in  connection  with  the
representations  and  warranties  made  regarding the related  Mortgage Loan and
either (A) the related  Mortgage  Loan is not in default with regard to payments
due  thereunder or (B)  delinquent  payments of principal and interest under the
related  Mortgage  Loan  and  any  premiums  on any  applicable  primary  hazard
insurance  policy and any related  escrow  payments in respect of such  Mortgage
Loan  are  being  advanced  on a  current  basis  by the  Master  Servicer  or a
Subservicer, in either case without giving effect to any Debt Service Reduction.

To the extent the Master Servicer receives Subsequent Recoveries with respect to
any Mortgage Loan, the amount of the Realized Loss with respect to that Mortgage
Loan will be reduced to the extent  such  recoveries  are  applied to reduce the
Certificate  Principal  Balance of any Class of Certificates on any Distribution
Date.

      Record Date: With respect to each Distribution Date, the close of business
on the last  Business  Day of the month  next  preceding  the month in which the
related Distribution Date occurs.

      Regular  Certificate:  Any of  the  Certificates  other  than  a  Class  R
Certificate.

      Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation AB),
17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from time to time, and
subject to such  clarification  and  interpretation as have been provided by the
Commission in the adopting  release  (Asset-Backed  Securities,  Securities  Act
Release No.  33-8518,  70 Fed. Reg.  1,506,  1,531  (January 7, 2005)) or by the
staff of the  Commission,  or as may be provided by the  Commission or its staff
from time to time.

      Reimbursement Amounts: As defined in Section 3.22.

                                       26
<PAGE>

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

      REMIC  Administrator:  Residential  Funding  Company,  LLC. If Residential
Funding Company, LLC is found by a court of competent  jurisdiction to no longer
be able to fulfill its obligations as REMIC  Administrator  under this Agreement
the  Master  Servicer  or  Trustee  acting as Master  Servicer  shall  appoint a
successor REMIC Administrator,  subject to assumption of the REMIC Administrator
obligations under this Agreement.

      REMIC  Provisions:  Provisions  of the federal  income tax law relating to
real estate mortgage investment conduits,  which appear at Sections 860A through
860G of  Subchapter  M of Chapter 1 of the Code,  and  related  provisions,  and
temporary and final  regulations (or, to the extent not  inconsistent  with such
temporary or final  regulations,  proposed  regulations) and published  rulings,
notices and  announcements  promulgated  thereunder,  as the foregoing may be in
effect from time to time.

      REO  Acquisition:  The acquisition by the Master Servicer on behalf of the
Trustee for the benefit of the  Certificateholders  of any REO Property pursuant
to Section 3.14.

      REO  Disposition:  As to any REO Property,  a determination  by the Master
Servicer that it has received all Insurance Proceeds,  Liquidation Proceeds, REO
Proceeds and other payments and recoveries  (including proceeds of a final sale)
which the Master  Servicer  expects to be finally  recoverable  from the sale or
other disposition of the REO Property.

      REO Imputed  Interest:  As to any REO Property,  for any period, an amount
equivalent to interest (at the Net Mortgage Rate that would have been applicable
to the related  Mortgage Loan had it been  outstanding) on the unpaid  principal
balance of the  Mortgage  Loan as of the date of  acquisition  thereof  for such
period.

      REO Proceeds:  Proceeds,  net of expenses,  received in respect of any REO
Property (including, without limitation, proceeds from the rental of the related
Mortgaged  Property  or,  with  respect  to  a  Cooperative  Loan,  the  related
Cooperative  Apartment)  which  proceeds are  required to be deposited  into the
Custodial Account only upon the related REO Disposition.

      REO Property: A Mortgaged Property acquired by the Master Servicer through
foreclosure  or deed  in lieu of  foreclosure  in  connection  with a  defaulted
Mortgage Loan.

      Reportable  Modified  Mortgage  Loan:  Any Mortgage Loan that (i) has been
subject to an interest rate reduction, (ii) has been subject to a term extension
or (iii) has had amounts owing on such Mortgage Loan  capitalized by adding such
amount to the Stated Principal Balance of such Mortgage Loan; provided, however,
that a  Mortgage  Loan  modified  in  accordance  with  clause  (i)  above for a
temporary  period  shall  not be a  Reportable  Modified  Mortgage  Loan if such
Mortgage Loan has not been  delinquent in payments of principal and interest for
six months since the date of such  modification  if that interest rate reduction
is not made permanent thereafter.

      Request  for  Release:  A  request  for  release,  the  forms of which are
attached as Exhibit F hereto,  or an electronic  request in a form acceptable to
the Custodian.

                                       27
<PAGE>

      Required  Insurance  Policy:  With  respect  to  any  Mortgage  Loan,  any
insurance policy which is required to be maintained from time to time under this
Agreement, the Program Guide or the related Subservicing Agreement in respect of
such Mortgage Loan.

      Required  Surety Payment:  With respect to any Additional  Collateral Loan
that becomes a Liquidated Mortgage Loan, the lesser of (i) the principal portion
of the Realized Loss with respect to such Mortgage Loan and (ii) the excess,  if
any, of (a) the amount of Additional  Collateral  required at  origination  with
respect  to  such  Mortgage  Loan  over  (b) the net  proceeds  realized  by the
Subservicer from the related Additional Collateral.

      Residential Funding:  Residential Funding Company, LLC, a Delaware limited
liability  company,  in its  capacity  as  seller of the  Mortgage  Loans to the
Company and any successor thereto.

      Responsible Officer: When used with respect to the Trustee, any officer of
the  Corporate  Trust  Department  of the  Trustee,  including  any Senior  Vice
President,  any Vice  President,  any Assistant  Vice  President,  any Assistant
Secretary, any Trust Officer or Assistant Trust Officer, or any other officer of
the Trustee customarily  performing  functions similar to those performed by any
of the above designated  officers to whom, with respect to a particular  matter,
such  matter  is  referred,  in each  case with  direct  responsibility  for the
administration of the Agreement.

      Retail  Certificates:  A Senior  Certificate,  if any,  offered in smaller
minimum denominations than other Senior Certificates,  and designated as such in
the Series Supplement.

      Schedule of Discount  Fractions:  The schedule  setting forth the Discount
Fractions with respect to the Discount Mortgage Loans, attached as an exhibit to
the Series Supplement.

      Securitization  Transaction:  Any  transaction  involving  a sale or other
transfer  of  mortgage  loans  directly or  indirectly  to an issuing  entity in
connection with an issuance of publicly  offered or privately  placed,  rated or
unrated mortgage-backed securities.

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

      Seller: As to any Mortgage Loan, a Person, including any Subservicer, that
executed a Seller's Agreement applicable to such Mortgage Loan.

      Seller's Agreement:  An agreement for the origination and sale of Mortgage
Loans generally in the form of the Seller  Contract  referred to or contained in
the  Program  Guide,  or in such other form as has been  approved  by the Master
Servicer and the Company,  each  containing  representations  and  warranties in
respect of one or more Mortgage Loans  consistent in all material  respects with
those set forth in the Program Guide.

      Senior   Accelerated   Distribution   Percentage:   With  respect  to  any
Distribution  Date occurring on or prior to the 60th Distribution Date and, with
respect to any Mortgage  Pool  comprised  of two or more Loan  Groups,  any Loan
Group,  100%. With respect to any Distribution Date thereafter and any such Loan
Group, if applicable, as follows:

                                       28
<PAGE>

            (i) for any Distribution  Date after the 60th  Distribution Date but
      on or prior to the 72nd  Distribution  Date, the related Senior Percentage
      for such Distribution Date plus 70% of the related Subordinate  Percentage
      for such Distribution Date;

            (ii) for any Distribution  Date after the 72nd Distribution Date but
      on or prior to the 84th  Distribution  Date, the related Senior Percentage
      for such Distribution Date plus 60% of the related Subordinate  Percentage
      for such Distribution Date;

            (iii) for any Distribution Date after the 84th Distribution Date but
      on or prior to the 96th  Distribution  Date, the related Senior Percentage
      for such Distribution Date plus 40% of the related Subordinate  Percentage
      for such Distribution Date;

            (iv) for any Distribution  Date after the 96th Distribution Date but
      on or prior to the 108th  Distribution Date, the related Senior Percentage
      for such Distribution Date plus 20% of the related Subordinate  Percentage
      for such Distribution Date; and

            (v) for any Distribution Date thereafter,  the Senior Percentage for
      such Distribution Date;

provided, however,

      (i) that any scheduled  reduction to the Senior  Accelerated  Distribution
Percentage  described above shall not occur as of any  Distribution  Date unless
either

            (a)(1)(X) the  outstanding  principal  balance of the Mortgage Loans
      delinquent  60  days  or  more  (including  Mortgage  Loans  which  are in
      foreclosure, have been foreclosed or otherwise liquidated, or with respect
      to which the  Mortgagor is in bankruptcy  and any REO  Property)  averaged
      over the last six months,  as a percentage  of the  aggregate  outstanding
      Certificate  Principal  Balance of the Subordinate  Certificates,  is less
      than  50% or (Y) the  outstanding  principal  balance  of  Mortgage  Loans
      delinquent  60  days  or  more  (including  Mortgage  Loans  which  are in
      foreclosure, have been foreclosed or otherwise liquidated, or with respect
      to which the  Mortgagor is in bankruptcy  and any REO  Property)  averaged
      over the last six months,  as a percentage  of the  aggregate  outstanding
      principal balance of all Mortgage Loans averaged over the last six months,
      does not exceed 2% and (2) Realized  Losses on the Mortgage  Loans to date
      for such Distribution Date if occurring during the sixth, seventh, eighth,
      ninth or tenth year (or any year  thereafter)  after the Closing  Date are
      less than  30%,  35%,  40%,  45% or 50%,  respectively,  of the sum of the
      Initial Certificate Principal Balances of the Subordinate Certificates or

             (b)(1)  the  outstanding   principal   balance  of  Mortgage  Loans
      delinquent  60  days  or  more  (including  Mortgage  Loans  which  are in
      foreclosure, have been foreclosed or otherwise liquidated, or with respect
      to which the  Mortgagor is in bankruptcy  and any REO  Property)  averaged
      over the last six months,  as a percentage  of the  aggregate  outstanding
      principal balance of all Mortgage Loans averaged over the last six months,
      does not exceed 4% and (2) Realized  Losses on the Mortgage  Loans to date
      for such  Distribution  Date,  if  occurring  during the  sixth,  seventh,
      eighth,  ninth or tenth year (or any year  thereafter)  after the  Closing
      Date are less than 10%, 15%, 20%, 25% or 30%,

                                       29
<PAGE>

      respectively,  of the sum of the Initial Certificate Principal Balances of
      the Subordinate Certificates, and

      (ii) that for any  Distribution  Date on which the  Senior  Percentage  is
greater  than  the  Senior  Percentage  as  of  the  Closing  Date,  the  Senior
Accelerated  Distribution  Percentage for such  Distribution Date shall be 100%,
or,  if the  Mortgage  Pool is  comprised  of two or more Loan  Groups,  for any
Distribution  Date on which the weighted  average of the Senior  Percentages for
each Loan Group,  weighted on the basis of the Stated Principal  Balances of the
Mortgage Loans in the related Loan Group (excluding the Discount Fraction of the
Discount  Mortgage Loans in such Loan Group) exceeds the weighted average of the
initial Senior Percentages  (calculated on such basis) for each Loan Group, each
of the Senior  Accelerated  Distribution  Percentages for such Distribution Date
will equal 100%.

Notwithstanding the foregoing,  upon the reduction of the Certificate  Principal
Balances  of  the  related  Senior   Certificates  (other  than  the  Class  A-P
Certificates,  if any) to zero,  the  related  Senior  Accelerated  Distribution
Percentage shall thereafter be 0%.

      Senior Certificate:  As defined in the Series Supplement.

      Senior Percentage: As defined in the Series Supplement.

      Senior Support Certificate:  A Senior Certificate that provides additional
credit  enhancement  to  certain  other  classes  of  Senior   Certificates  and
designated as such in the Preliminary Statement of the Series Supplement.

      Series: All of the Certificates issued pursuant to a Pooling and Servicing
Agreement and bearing the same series designation.

      Series  Supplement:  The  agreement  into  which  this  Standard  Terms is
incorporated and pursuant to which,  together with this Standard Terms, a Series
of Certificates is issued.

      Servicing  Accounts:  The  account  or  accounts  created  and  maintained
pursuant to Section 3.08.

      Servicing Criteria:  The "servicing criteria" set forth in Item 1122(d) of
Regulation AB, as such may be amended from time to time.

      Servicing  Advances:  All  customary,  reasonable  and  necessary  "out of
pocket" costs and expenses incurred in connection with a default, delinquency or
other  unanticipated  event  by the  Master  Servicer  or a  Subservicer  in the
performance  of its servicing  obligations,  including,  but not limited to, the
cost of (i) the preservation, restoration and protection of a Mortgaged Property
or, with respect to a Cooperative Loan, the related Cooperative Apartment,  (ii)
any enforcement or judicial proceedings,  including foreclosures,  including any
expenses  incurred  in  relation  to any such  proceedings  that result from the
Mortgage Loan being  registered  on the MERS System,  (iii) the  management  and
liquidation of any REO Property,  (iv) any mitigation procedures  implemented in
accordance  with Section 3.07, and (v)  compliance  with the  obligations  under
Sections 3.01, 3.08, 3.11, 3.12(a) and 3.14,  including,  if the Master Servicer
or any Affiliate of the Master Servicer provides services such as appraisals and
brokerage services that are

                                       30
<PAGE>

customarily  provided  by  Persons  other  than  servicers  of  mortgage  loans,
reasonable compensation for such services.

      Servicing Advance Reimbursement Amounts: As defined in Section 3.22.

      Servicing  Fee: With respect to any Mortgage Loan and  Distribution  Date,
the fee payable  monthly to the Master  Servicer in respect of master  servicing
compensation  that accrues at an annual rate  designated  on the  Mortgage  Loan
Schedule as the "MSTR SERV FEE" for such Mortgage  Loan, as may be adjusted with
respect to successor Master Servicers as provided in Section 7.02.

      Servicing  Modification:  Any  reduction  of the  interest  rate on or the
outstanding  principal  balance of a Mortgage  Loan,  any extension of the final
maturity date of a Mortgage Loan, and any increase to the outstanding  principal
balance of a  Mortgage  Loan by adding to the Stated  Principal  Balance  unpaid
principal and interest and other amounts owing under the Mortgage  Loan, in each
case pursuant to a  modification  of a Mortgage Loan that is in default,  or for
which, in the judgment of the Master Servicer, default is reasonably foreseeable
in accordance with Section 3.07(a).

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

      Sharia  Mortgage  Loan:  A  declining  balance  co-ownership  transaction,
structured so as to comply with Islamic religious law.

      Sharia Mortgage Loan  Co-Ownership  Agreement:  The agreement that defines
the relationship  between the consumer and co-owner and the parties'  respective
rights under a Sharia  Mortgage Loan,  including  their  respective  rights with
respect to the indicia of ownership of the related Mortgaged Property.

      Sharia  Mortgage  Loan  Security   Instrument:   The  mortgage,   security
instrument or other comparable  instrument creating a first lien on an estate in
fee simple or leasehold interest in real property securing an Obligation to Pay.

      Special  Hazard Loss:  Any Realized  Loss not in excess of the cost of the
lesser of repair or replacement  of a Mortgaged  Property (or, with respect to a
Cooperative Loan, the related Cooperative  Apartment) suffered by such Mortgaged
Property  (or  Cooperative  Apartment)  on  account  of  direct  physical  loss,
exclusive  of (i) any  loss of a type  covered  by a  hazard  policy  or a flood
insurance policy required to be maintained in respect of such Mortgaged Property
pursuant  to Section  3.12(a),  except to the extent of the portion of such loss
not covered as a result of any coinsurance  provision and (ii) any Extraordinary
Loss.

      Standard & Poor's:  Standard & Poor's Ratings Services,  a division of The
McGraw-Hill Companies, Inc., or its successor in interest.

                                       31
<PAGE>

      Stated Principal Balance: With respect to any Mortgage Loan or related REO
Property,  as of any  Distribution  Date,  (i) the sum of (a) the  Cut-off  Date
Principal  Balance of the Mortgage  Loan plus (b) any amount by which the Stated
Principal  Balance  of the  Mortgage  Loan  has  been  increased  pursuant  to a
Servicing  Modification,  minus (ii) the sum of (a) the principal portion of the
Monthly  Payments due with respect to such Mortgage Loan or REO Property  during
each Due Period ending with the Due Period related to the previous  Distribution
Date which were  received or with respect to which an Advance was made,  and (b)
all  Principal  Prepayments  with respect to such Mortgage Loan or REO Property,
and all Insurance Proceeds, Liquidation Proceeds and REO Proceeds, to the extent
applied by the Master  Servicer as recoveries  of principal in  accordance  with
Section 3.14 with respect to such Mortgage  Loan or REO  Property,  in each case
which were  distributed  pursuant to Section 4.02 on any  previous  Distribution
Date,  and (c) any Realized Loss  allocated to  Certificateholders  with respect
thereto for any previous Distribution Date.

      Subclass: With respect to the Class A-V Certificates, any Subclass thereof
issued  pursuant  to Section  5.01(c).  Any such  Subclass  will  represent  the
Uncertificated  REMIC  Regular  Interest or Interests Z specified by the initial
Holder of the Class A-V Certificates pursuant to Section 5.01(c).

      Subordinate  Certificate:  Any one of the Class M Certificates  or Class B
Certificates,  executed  by the  Trustee and  authenticated  by the  Certificate
Registrar  substantially  in the form annexed hereto as Exhibit B and Exhibit C,
respectively.

      Subordinate  Class  Percentage:  With respect to any Distribution Date and
any Class of Subordinate  Certificates,  a fraction,  expressed as a percentage,
the numerator of which is the aggregate  Certificate  Principal  Balance of such
Class  of  Subordinate  Certificates  immediately  prior  to such  date  and the
denominator  of which is the aggregate  Stated  Principal  Balance of all of the
Mortgage  Loans (or related  REO  Properties)  (other than the related  Discount
Fraction of each Discount  Mortgage Loan) immediately prior to such Distribution
Date.

      Subordinate  Percentage:  As of any Distribution Date and, with respect to
any Mortgage  Pool  comprised of two or more Loan Groups,  any Loan Group,  100%
minus the related Senior Percentage as of such Distribution Date.

      Subsequent  Recoveries:  As of any Distribution  Date, amounts received by
the Master  Servicer  (net of any related  expenses  permitted to be  reimbursed
pursuant  to Section  3.10) or surplus  amounts  held by the Master  Servicer to
cover estimated expenses  (including,  but not limited to, recoveries in respect
of the representations and warranties made by the related Seller pursuant to the
applicable  Seller's  Agreement and assigned to the Trustee  pursuant to Section
2.04)  specifically  related to a Mortgage  Loan that was the  subject of a Cash
Liquidation or an REO Disposition  prior to the related  Prepayment  Period that
resulted in a Realized Loss.

      Subserviced  Mortgage  Loan:  Any  Mortgage  Loan  that,  at the  time  of
reference thereto, is subject to a Subservicing Agreement.

      Subservicer:  Any Person with whom the Master  Servicer has entered into a
Subservicing Agreement and who generally satisfied the requirements set forth in
the Program Guide in

                                       32
<PAGE>

respect of the  qualification of a Subservicer as of the date of its approval as
a Subservicer by the Master Servicer.

      Subservicer Advance: Any delinquent  installment of principal and interest
on a Mortgage  Loan which is  advanced by the  related  Subservicer  (net of its
Subservicing Fee) pursuant to the Subservicing Agreement.

      Subservicing   Account:   An  account  established  by  a  Subservicer  in
accordance with Section 3.08.

      Subservicing  Agreement:  The written contract between the Master Servicer
and any Subservicer relating to servicing and administration of certain Mortgage
Loans as  provided  in  Section  3.02,  generally  in the  form of the  servicer
contract  referred to or contained in the Program Guide or in such other form as
has been  approved  by the Master  Servicer  and the  Company.  With  respect to
Additional  Collateral  Loans  subserviced by MLCC, the  Subservicing  Agreement
shall also include the Addendum and  Assignment  Agreement and the Pledged Asset
Mortgage Servicing Agreement. With respect to any Pledged Asset Loan subserviced
by GMAC  Mortgage,  LLC,  the  Addendum and  Assignment  Agreement,  dated as of
November 24, 1998,  between the Master Servicer and GMAC Mortgage,  LLC, as such
agreement may be amended from time to time.

      Subservicing  Fee: As to any Mortgage Loan, the fee payable monthly to the
related  Subservicer (or, in the case of a Nonsubserviced  Mortgage Loan, to the
Master Servicer) in respect of subservicing and other  compensation that accrues
at an annual rate equal to the excess of the Mortgage  Rate borne by the related
Mortgage  Note over the rate per annum  designated on the Mortgage Loan Schedule
as the "CURR NET" for such Mortgage Loan.

      Successor Master Servicer: As defined in Section 3.22.

      Surety:  Ambac, or its successors in interest, or such other surety as may
be identified in the Series Supplement.

      Surety Bond: The Limited Purpose Surety Bond (Policy No. AB0039BE),  dated
February 28, 1996 in respect to Mortgage Loans originated by MLCC, or the Surety
Bond (Policy No.  AB0240BE),  dated March 17, 1999 in respect to Mortgage  Loans
originated by Novus Financial Corporation,  in each case issued by Ambac for the
benefit of certain  beneficiaries,  including the Trustee for the benefit of the
Holders of the Certificates, but only to the extent that such Surety Bond covers
any Additional  Collateral Loans, or such other Surety Bond as may be identified
in the Series Supplement.

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

                                       33
<PAGE>

      Transaction Party:  As defined in Section 12.02(a).

      Transfer: Any direct or indirect transfer, sale, pledge,  hypothecation or
other form of assignment of any Ownership Interest in a Certificate.

      Transferee: Any Person who is acquiring by Transfer any Ownership Interest
in a Certificate.

      Transferor:  Any Person who is  disposing  by  Transfer  of any  Ownership
Interest in a Certificate.

      Trust  Fund:  The  segregated  pool of assets  related  to a Series,  with
respect to which one or more REMIC  elections  are to be made  pursuant  to this
Agreement, consisting of:

            (i) the Mortgage Loans and the related Mortgage Files and collateral
      securing such Mortgage Loans,

            (ii) all  payments  on and  collections  in respect of the  Mortgage
      Loans due after the Cut-off  Date as shall be on deposit in the  Custodial
      Account or in the  Certificate  Account and identified as belonging to the
      Trust Fund,  including  the proceeds  from the  liquidation  of Additional
      Collateral  for any Additional  Collateral  Loan or Pledged Assets for any
      Pledged Asset Loan,  but not  including  amounts on deposit in the Initial
      Monthly Payment Fund,

            (iii)  property  that  secured  a  Mortgage  Loan  and that has been
      acquired for the benefit of the  Certificateholders by foreclosure or deed
      in lieu of foreclosure,

            (iv) the hazard insurance  policies and Primary Insurance  Policies,
      if any, the Pledged  Assets with respect to each Pledged  Asset Loan,  and
      the  interest in the Surety Bond  transferred  to the Trustee  pursuant to
      Section 2.01, and

            (v) all proceeds of clauses (i) through (iv) above.

      Trustee Information:  As specified in Section 12.05(a)(i)(A).

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

      United  States  Person or U.S.  Person:  (i) A citizen or  resident of the
United  States,  (ii) a  corporation,  partnership  or other entity treated as a
corporation  or  partnership  for United  States  federal  income  tax  purposes
organized in or under the laws of the United  States or any state thereof or the
District of Columbia (unless, in the case of a partnership, Treasury regulations
provide  otherwise),  provided that, for purposes solely of the  restrictions on
the transfer of residual interests,  no partnership or other entity treated as a
partnership  for United States federal income tax purposes shall be treated as a
United States  Person or U.S.  Person unless all persons that own an interest in
such partnership  either directly or indirectly through any chain of entities no
one of which is a corporation  for United States federal income tax purposes are
required by the  applicable  operating  agreement to be United  States  Persons,
(iii) an estate the income of

                                       34
<PAGE>

which is includible  in gross income for United States tax purposes,  regardless
of its source,  or (iv) a trust if a court  within the United  States is able to
exercise  primary  supervision over the  administration  of the trust and one or
more United States persons have authority to control all  substantial  decisions
of the trust.  Notwithstanding the preceding sentence, to the extent provided in
Treasury  regulations,  certain  Trusts in  existence  on August 20,  1996,  and
treated as United States  persons prior to such date,  that elect to continue to
be treated as United States persons will also be a U.S. Person.

      U.S.A.  Patriot  Act:  Uniting  and  Strengthening  America  by  Providing
Appropriate Tools to Intercept and Obstruct Terrorism Act of 2001, as amended.

      Voting Rights: The portion of the voting rights of all of the Certificates
which is allocated  to any  Certificate,  and more  specifically  designated  in
Article XI of the Series Supplement.

      Section 1.02. Use of Words and Phrases.

      "Herein," "hereby," "hereunder," `hereof,"  "hereinbefore,"  "hereinafter"
and other  equivalent  words refer to the Pooling and  Servicing  Agreement as a
whole. All references herein to Articles, Sections or Subsections shall mean the
corresponding  Articles,  Sections and  Subsections in the Pooling and Servicing
Agreement.  The  definitions  set forth herein include both the singular and the
plural.

      References  in the Pooling and  Servicing  Agreement to  "interest" on and
"principal"  of the  Mortgage  Loans  shall  mean,  with  respect  to the Sharia
Mortgage Loans,  amounts in respect profit  payments and  acquisition  payments,
respectively.

                                       35
<PAGE>

                                   Article II

                          CONVEYANCE OF MORTGAGE LOANS;
                        ORIGINAL ISSUANCE OF CERTIFICATES

      Section 2.01. Conveyance of Mortgage Loans.

      (a) The Company, concurrently with the execution and delivery hereof, does
hereby assign to the Trustee for the benefit of the  Certificateholders  without
recourse all the right, title and interest of the Company in and to the Mortgage
Loans,  including all interest and principal  received on or with respect to the
Mortgage  Loans after the Cut-off  Date (other than  payments of  principal  and
interest  due on the  Mortgage  Loans in the  month  of the  Cut-off  Date).  In
connection with such transfer and assignment, the Company does hereby deliver to
the Trustee the Certificate Policy (as defined in the Series Supplement), if any
for the benefit of the Holders of the  Insured  Certificates  (as defined in the
Series Supplement).

      (b) In  connection  with such  assignment,  except as set forth in Section
2.01(c) and subject to Section  2.01(d) below,  the Company does hereby (1) with
respect  to each  Mortgage  Loan  (other  than a  Cooperative  Loan or a  Sharia
Mortgage  Loan),  deliver to the Master  Servicer (or an Affiliate of the Master
Servicer) each of the documents or instruments described in clause (I)(ii) below
(and the  Master  Servicer  shall hold (or cause  such  Affiliate  to hold) such
documents  or  instruments  in trust for the use and  benefit of all present and
future  Certificateholders),  (2) with respect to each MOM Loan,  deliver to and
deposit  with the  Trustee,  or the  Custodian  on  behalf of the  Trustee,  the
documents or  instruments  described in clauses  (I)(i) and (v) below,  (3) with
respect to each  Mortgage  Loan that is not a MOM Loan but is  registered on the
MERS(R) System,  deliver to and deposit with the Trustee, or to the Custodian on
behalf of the Trustee, the documents or instruments described in clauses (I)(i),
(iv) and (v) below,  (4) with  respect to each  Mortgage  Loan that is not a MOM
Loan and is not  registered on the MERS(R)  System,  deliver to and deposit with
the Trustee,  or to the  Custodian on behalf of the  Trustee,  the  documents or
instruments described in clauses (I)(i), (iii), (iv) and (v) below, and (5) with
respect  to each  Cooperative  Loan and  Sharia  Mortgage  Loan,  deliver to and
deposit with the  Trustee,  or to the  Custodian  on behalf of the Trustee,  the
documents and instruments described in clause (II) and clause (III) below:

      (I)  with  respect  to  each  Mortgage  Loan  so  assigned  (other  than a
Cooperative Loan or a Sharia Mortgage Loan):

            (i) The original  Mortgage Note,  endorsed without recourse in blank
      or to the  order  of  the  Trustee,  and  showing  an  unbroken  chain  of
      endorsements from the originator thereof to the Person endorsing it to the
      Trustee,  or with respect to any Destroyed Mortgage Note, an original lost
      note affidavit from the related Seller or Residential Funding stating that
      the original Mortgage Note was lost, misplaced or destroyed, together with
      a copy of the related Mortgage Note;

            (ii) The  original  Mortgage,  noting the presence of the MIN of the
      Mortgage Loan and language indicating that the Mortgage Loan is a MOM Loan
      if the Mortgage

                                       36
<PAGE>

      Loan is a MOM Loan, with evidence of recording indicated thereon or a copy
      of the Mortgage with evidence of recording indicated thereon;

            (iii) The  original  Assignment  of the Mortgage to the Trustee with
      evidence of recording  indicated thereon or a copy of such assignment with
      evidence of recording indicated thereon;

            (iv) The original recorded assignment or assignments of the Mortgage
      showing  an  unbroken  chain of title from the  originator  thereof to the
      Person  assigning it to the Trustee (or to MERS,  if the Mortgage  Loan is
      registered  on the MERS(R)  System and noting the  presence of a MIN) with
      evidence of recordation  noted thereon or attached  thereto,  or a copy of
      such  assignment or assignments of the Mortgage with evidence of recording
      indicated thereon; and

            (v) The  original  of each  modification,  assumption  agreement  or
      preferred loan agreement, if any, relating to such Mortgage Loan or a copy
      of each modification, assumption agreement or preferred loan agreement

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

            (i) The original  Mortgage Note,  endorsed  without  recourse to the
      order of the Trustee and showing an unbroken  chain of  endorsements  from
      the originator thereof to the Person endorsing it to the Trustee,  or with
      respect to any Destroyed  Mortgage  Note, an original lost note  affidavit
      from the related Seller or Residential  Funding  stating that the original
      Mortgage Note was lost,  misplaced or  destroyed,  together with a copy of
      the related Mortgage Note;

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

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

            (iv) The original  recognition  agreement by the  Cooperative of the
      interests of the mortgagee with respect to the related Cooperative Loan or
      a copy thereof;

            (v) The Security Agreement or a copy thereof;

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

            (vii) Copies of the filed UCC-3 assignments of the security interest
      referenced  in clause (vi) above  showing an unbroken  chain of title from
      the originator to the Trustee,

                                       37
<PAGE>

      each with evidence of recording  thereof,  evidencing  the interest of the
      originator under the Security  Agreement and the Assignment of Proprietary
      Lease;

            (viii) An executed  assignment of the interest of the  originator in
      the  Security   Agreement,   Assignment  of  Proprietary   Lease  and  the
      recognition agreement referenced in clause (iv) above, showing an unbroken
      chain of title from the originator to the Trustee, or a copy thereof;

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

            (x) A duly completed  UCC-1 financing  statement  showing the Master
      Servicer  as  debtor,  the  Company as  secured  party and the  Trustee as
      assignee  and a duly  completed  UCC-1  financing  statement  showing  the
      Company  as  debtor  and the  Trustee  as  secured  party,  each in a form
      sufficient  for filing,  evidencing  the  interest of such  debtors in the
      Cooperative Loans or copies thereof;

      (III) with respect to each Sharia Mortgage Loan so assigned:

            (i) The original  Obligation to Pay,  endorsed  without  recourse in
      blank or to the order of the  Trustee  and  showing an  unbroken  chain of
      endorsements from the originator thereof to the Person endorsing it to the
      Trustee,  or with respect to any Destroyed  Obligation to Pay, an original
      affidavit from the related Seller or Residential  Funding stating that the
      original Obligation to Pay was lost, misplaced or destroyed, together with
      a copy of the related Obligation to Pay;

            (ii) The original  Sharia  Mortgage Loan Security  Instrument,  with
      evidence of recording  indicated  thereon or a copy of the Sharia Mortgage
      Loan Security Instrument with evidence of recording indicated thereon;

            (iii) An original  Assignment and Amendment of Security  Instrument,
      assigned to the Trustee with evidence of recording  indicated thereon or a
      copy of such Assignment and Amendment of Security Instrument with evidence
      of recording indicated thereon;

            (iv) The original  recorded  assignment or assignments of the Sharia
      Mortgage Loan Security  Instrument showing an unbroken chain of title from
      the  originator  thereof to the Person  assigning  it to the Trustee  with
      evidence of recordation  noted thereon or attached  thereto,  or a copy of
      such  assignment  or  assignments  of the Sharia  Mortgage  Loan  Security
      Instrument with evidence of recording indicated thereon;

            (v) The original  Sharia Mortgage Loan  Co-Ownership  Agreement with
      respect  to the  related  Sharia  Mortgage  Loan or a copy of such  Sharia
      Mortgage Loan Co-Ownership Agreement; and

            (vi) The original of each modification or assumption  agreement,  if
      any,  relating to such Sharia Mortgage Loan or a copy of each modification
      or assumption agreement.

                                       38
<PAGE>

      (c) The Company may, in lieu of  delivering  the original of the documents
set forth in Sections 2.01(b)(I)(iii), (iv) and (v), Sections (b)(II)(ii), (iv),
(vii), (ix) and (x) and Sections 2.01(b)(III)(ii), (iii), (iv), (v) and (vi) (or
copies  thereof) to the Trustee or to the  Custodian  on behalf of the  Trustee,
deliver such  documents to the Master  Servicer,  and the Master  Servicer shall
hold such  documents  in trust for the use and benefit of all present and future
Certificateholders until such time as is set forth in the next sentence.  Within
thirty Business Days following the earlier of (i) the receipt of the original of
all of the documents or instruments set forth in Sections 2.01(b)(I)(iii),  (iv)
and  (v),  Sections  (b)(II)(ii),   (iv),  (vii),  (ix)  and  (x)  and  Sections
2.01(b)(III)(ii), (iii), (iv), (v) and (vi) (or copies thereof) for any Mortgage
Loan and (ii) a written  request by the Trustee to deliver those  documents with
respect  to any or all of the  Mortgage  Loans  then  being  held by the  Master
Servicer,  the Master Servicer shall deliver a complete set of such documents to
the Trustee or to the Custodian on behalf of the Trustee.

      The parties hereto agree that it is not intended that any Mortgage Loan be
included in the Trust Fund that is either (i) a "High-Cost Home Loan" as defined
in the New Jersey  Home  Ownership  Act  effective  November  27,  2003,  (ii) a
"High-Cost  Home Loan" as defined in the New  Mexico  Home Loan  Protection  Act
effective  January 1, 2004, (iii) a "High Cost Home Mortgage Loan" as defined in
the Massachusetts  Predatory Home Loan Practices Act effective  November 7, 2004
or (iv) a "High-Cost Home Loan" as defined in the Indiana House Enrolled Act No.
1229, effective as of January 1, 2005.

      (d)  Notwithstanding the provisions of Section 2.01(c), in connection with
any Mortgage  Loan, if the Company  cannot deliver the original of the Mortgage,
any assignment,  modification,  assumption agreement or preferred loan agreement
(or copy  thereof as permitted by Section  2.01(b))  with  evidence of recording
thereon  concurrently  with the execution and delivery of this Agreement because
of (i) a delay  caused by the  public  recording  office  where  such  Mortgage,
assignment,  modification,  assumption  agreement or preferred loan agreement as
the case may be,  has been  delivered  for  recordation,  or (ii) a delay in the
receipt of certain information necessary to prepare the related assignments, the
Company  shall  deliver  or  cause  to be  delivered  to the  Trustee  or to the
Custodian  on  behalf  of the  Trustee  a copy  of  such  Mortgage,  assignment,
modification, assumption agreement or preferred loan agreement.

      The Company  (i) shall  promptly  cause to be recorded in the  appropriate
public office for real  property  records the  Assignment  referred to in clause
(I)(iii)  of Section  2.01(b),  except (a) in states  where,  in the  opinion of
counsel acceptable to the Trustee and the Master Servicer, such recording is not
required to protect the  Trustee's  interests in the  Mortgage  Loan against the
claim of any  subsequent  transferee  or any  successor  to or  creditor  of the
Company or the  originator of such Mortgage Loan or (b) if MERS is identified on
the  Mortgage  or on a  properly  recorded  assignment  of the  Mortgage  as the
mortgagee  of record  solely as nominee  for the Seller and its  successors  and
assigns,  (ii) shall  promptly  cause to be filed the Form UCC-3  assignment and
UCC-1   financing   statement   referred  to  in  clauses   (II)(vii)  and  (x),
respectively,  of Section  2.01(b) and (iii) shall promptly cause to be recorded
in the  appropriate  public  recording  office  for real  property  records  the
Assignment  Agreement and Amendment of Security Instrument referred to in clause
(III)(iii)  of Section  2.01(b).  If any  Assignment,  Assignment  Agreement and
Amendment of Security  Instrument,  Form UCC-3 or Form UCC-1, as applicable,  is
lost or returned  unrecorded to the Company because of any defect  therein,  the
Company  shall  prepare  a  substitute  Assignment,   Assignment  Agreement  and
Amendment of Security Instrument, Form

                                       39
<PAGE>

UCC-3 or Form UCC-1, as applicable, or cure such defect, as the case may be, and
cause  such  Assignment  or  Assignment  Agreement  and  Amendment  of  Security
Instrument to be recorded in accordance with this  paragraph.  The Company shall
promptly deliver or cause to be delivered to the applicable  person described in
Section 2.01(b), any Assignment, substitute Assignment, Assignment Agreement and
Amendment of Security Instrument or Form UCC-3 or Form UCC-1, as applicable, (or
copy  thereof)  recorded in  connection  with this  paragraph,  with evidence of
recording  indicated  thereon  at the time  specified  in  Section  2.01(c).  In
connection with its servicing of Cooperative Loans, the Master Servicer will use
its best  efforts to file  timely  continuation  statements  with regard to each
financing statement and assignment relating to Cooperative Loans as to which the
related Cooperative Apartment is located outside of the State of New York.

      If the Company  delivers to the Trustee or to the  Custodian  on behalf of
the Trustee any Mortgage  Note,  Obligation  to Pay,  Assignment  Agreement  and
Amendment of Security Instrument or Assignment of Mortgage in blank, the Company
shall, or shall cause the Custodian to, complete the endorsement of the Mortgage
Note,  Obligation  to  Pay,  Assignment  Agreement  and  Amendment  of  Security
Instrument  and Assignment of Mortgage in the name of the Trustee in conjunction
with the Interim  Certification  issued by the  Custodian,  as  contemplated  by
Section 2.02.

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

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

      (f) It is intended  that the  conveyance  by the Company to the Trustee of
the   Mortgage   Loans  as  provided  for  in  this  Section  2.01  be  and  the
Uncertificated  REMIC  Regular  Interests,  if any (as  provided  for in Section
2.06), be construed as a sale by the Company to the Trustee of

                                       40
<PAGE>

the  Mortgage  Loans and any  Uncertificated  REMIC  Regular  Interests  for the
benefit  of the  Certificateholders.  Further,  it is  not  intended  that  such
conveyance be deemed to be a pledge of the Mortgage Loans and any Uncertificated
REMIC Regular  Interests by the Company to the Trustee to secure a debt or other
obligation of the Company. Nonetheless, (a) this Agreement is intended to be and
hereby is a security agreement within the meaning of Articles 8 and 9 of the New
York  Uniform  Commercial  Code and the  Uniform  Commercial  Code of any  other
applicable  jurisdiction;  (b) the conveyance provided for in Section 2.01 shall
be deemed to be, and hereby is, (1) a grant by the  Company to the  Trustee of a
security  interest in all of the Company's right  (including the power to convey
title thereto), title and interest,  whether now owned or hereafter acquired, in
and to any and all general intangibles,  payment intangibles,  accounts, chattel
paper, instruments, documents, money, deposit accounts, certificates of deposit,
goods,  letters of credit,  advices of credit and investment  property and other
property of whatever  kind or  description  now existing or  hereafter  acquired
consisting  of,  arising  from  or  relating  to any of the  following:  (A) the
Mortgage Loans, including (i) with respect to each Cooperative Loan, the related
Mortgage Note, Security Agreement,  Assignment of Proprietary Lease, Cooperative
Stock  Certificate  and  Cooperative  Lease,  (ii) with  respect to each  Sharia
Mortgage  Loan,  the related Sharia  Mortgage Loan Security  Instrument,  Sharia
Mortgage Loan Co-Ownership Agreement, Obligation to Pay and Assignment Agreement
and Amendment of Security  Instrument,  (iii) with respect to each Mortgage Loan
other than a Cooperative  Loan or a Sharia  Mortgage Loan, the related  Mortgage
Note and Mortgage,  and (iv) any insurance  policies and all other  documents in
the related  Mortgage  File,  (B) all amounts  payable  pursuant to the Mortgage
Loans in accordance with the terms thereof, (C) any Uncertificated REMIC Regular
Interests and (D) all proceeds of the conversion,  voluntary or involuntary,  of
the foregoing into cash,  instruments,  securities or other property,  including
without  limitation  all  amounts  from  time to time  held or  invested  in the
Certificate  Account  or the  Custodial  Account,  whether  in the form of cash,
instruments,  securities or other  property and (2) an assignment by the Company
to the Trustee of any security interest in any and all of Residential  Funding's
right (including the power to convey title thereto), title and interest, whether
now  owned  or  hereafter  acquired,  in and to the  property  described  in the
foregoing clauses (1)(A), (B), (C) and (D) granted by Residential Funding to the
Company pursuant to the Assignment Agreement; (c) the possession by the Trustee,
any  Custodian  on behalf of the  Trustee or any other  agent of the  Trustee of
Mortgage Notes or such other items of property as constitute instruments, money,
payment intangibles,  negotiable documents,  goods, deposit accounts, letters of
credit,  advices of credit,  investment  property,  certificated  securities  or
chattel  paper  shall be deemed to be  "possession  by the  secured  party,"  or
possession  by a purchaser or a person  designated  by such secured  party,  for
purposes of perfecting the security  interest  pursuant to the Minnesota Uniform
Commercial  Code  and  the  Uniform  Commercial  Code  of any  other  applicable
jurisdiction as in effect (including, without limitation, Sections 8-106, 9-313,
9-314  and  9-106  thereof);  and (d)  notifications  to  persons  holding  such
property,  and  acknowledgments,  receipts or confirmations from persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, securities intermediaries,  bailees or agents of, or persons
holding for (as  applicable)  the Trustee  for the  purpose of  perfecting  such
security interest under applicable law.

      The Company and, at the Company's  direction,  Residential Funding and the
Trustee  shall,  to  the  extent  consistent  with  this  Agreement,  take  such
reasonable  actions as may be necessary to ensure that, if this  Agreement  were
determined  to  create  a  security   interest  in  the  Mortgage   Loans,   any
Uncertificated REMIC Regular Interests and the other property described

                                       41
<PAGE>

above,  such security  interest  would be determined to be a perfected  security
interest of first priority  under  applicable law and will be maintained as such
throughout the term of this  Agreement.  Without  limiting the generality of the
foregoing, the Company shall prepare and deliver to the Trustee not less than 15
days prior to any filing date and,  the  Trustee  shall  forward for filing,  or
shall cause to be  forwarded  for filing,  at the  expense of the  Company,  all
filings  necessary  to  maintain  the  effectiveness  of  any  original  filings
necessary under the Uniform  Commercial Code as in effect in any jurisdiction to
perfect the Trustee's security interest in or lien on the Mortgage Loans and any
Uncertificated REMIC Regular Interests, as evidenced by an Officers' Certificate
of the Company,  including without limitation (x) continuation  statements,  and
(y) such  other  statements  as may be  occasioned  by (1) any change of name of
Residential  Funding,  the Company or the Trustee (such  preparation  and filing
shall be at the  expense  of the  Trustee,  if  occasioned  by a  change  in the
Trustee's  name),  (2) any change of type or  jurisdiction  of  organization  of
Residential  Funding  or the  Company,  (3)  any  transfer  of any  interest  of
Residential  Funding or the Company in any Mortgage  Loan or (4) any transfer of
any interest of Residential  Funding or the Company in any Uncertificated  REMIC
Regular Interest.

      (g) The  Master  Servicer  hereby  acknowledges  the  receipt by it of the
Initial  Monthly  Payment  Fund.  The Master  Servicer  shall hold such  Initial
Monthly  Payment Fund in the  Custodial  Account and shall  include such Initial
Monthly  Payment  Fund in the  Available  Distribution  Amount  for the  initial
Distribution Date.  Notwithstanding anything herein to the contrary, the Initial
Monthly  Payment Fund shall not be an asset of any REMIC. To the extent that the
Initial Monthly  Payment Fund  constitutes a reserve fund for federal income tax
purposes, (1) it shall be an outside reserve fund and not an asset of any REMIC,
(2) it shall be owned by the Seller and (3) amounts  transferred by any REMIC to
the Initial  Monthly  Payment Fund shall be treated as transferred to the Seller
or any successor,  all within the meaning of Section 1.860G-2(h) of the Treasury
Regulations.

      (h) The Company  agrees that the sale of each Pledged  Asset Loan pursuant
to this  Agreement  will also  constitute the  assignment,  sale,  setting-over,
transfer and  conveyance  to the Trustee,  without  recourse (but subject to the
Company's  covenants,   representations  and  warranties  specifically  provided
herein),  of all of the Company's  obligations  and all of the Company's  right,
title and interest in, to and under,  whether now existing or hereafter acquired
as owner of the  Mortgage  Loan with  respect to any and all money,  securities,
security  entitlements,  accounts,  general  intangibles,  payment  intangibles,
instruments,  documents, deposit accounts,  certificates of deposit, commodities
contracts,  and other investment property and other property of whatever kind or
description  consisting  of,  arising  from  or  related  to  (i)  the  Assigned
Contracts,  (ii) all rights, powers and remedies of the Company as owner of such
Mortgage  Loan  under or in  connection  with the  Assigned  Contracts,  whether
arising under the terms of such  Assigned  Contracts,  by statute,  at law or in
equity,  or otherwise  arising out of any default by the  Mortgagor  under or in
connection  with the Assigned  Contracts,  including  all rights to exercise any
election  or  option  or to make any  decision  or  determination  or to give or
receive any notice,  consent,  approval or waiver thereunder,  (iii) the Pledged
Amounts and all money,  securities,  security  entitlements,  accounts,  general
intangibles,  payment  intangibles,  instruments,  documents,  deposit accounts,
certificates of deposit,  commodities  contracts,  and other investment property
and other  property of whatever  kind or  description  and all cash and non-cash
proceeds of the sale,  exchange,  or redemption  of, and all stock or conversion
rights,  rights  to  subscribe,  liquidation  dividends  or  preferences,  stock
dividends, rights to interest, dividends, earnings,

                                       42
<PAGE>

income, rents, issues, profits, interest payments or other distributions of cash
or other property that secures a Pledged Asset Loan,  (iv) all documents,  books
and records concerning the foregoing  (including all computer  programs,  tapes,
disks and related items  containing any such  information) and (v) all insurance
proceeds (including  proceeds from the Federal Deposit Insurance  Corporation or
the Securities Investor  Protection  Corporation or any other insurance company)
of any of the  foregoing  or  replacements  thereof or  substitutions  therefor,
proceeds  of proceeds  and the  conversion,  voluntary  or  involuntary,  of any
thereof.  The foregoing  transfer,  sale,  assignment  and  conveyance  does not
constitute  and is not intended to result in the  creation,  or an assumption by
the Trustee, of any obligation of the Company, or any other person in connection
with the Pledged Assets or under any agreement or instrument  relating  thereto,
including any obligation to the  Mortgagor,  other than as owner of the Mortgage
Loan.

      Section 2.02. Acceptance by Trustee.

      The Trustee  acknowledges  receipt  (or,  with  respect to Mortgage  Loans
subject  to  a  Custodial  Agreement,   and  based  solely  upon  a  receipt  or
certification executed by the Custodian,  receipt by the respective Custodian as
the duly  appointed  agent  of the  Trustee)  of the  documents  required  to be
delivered to the Trustee (or the Custodian on behalf of the Trustee) pursuant to
Section 2.01(b) above (except that for purposes of such acknowledgement  only, a
Mortgage  Note may be endorsed in blank) and declares  that it, or the Custodian
as its  agent,  holds  and will  hold such  documents  and the  other  documents
constituting  a part of the Custodial  Files  delivered to it, or a Custodian as
its agent,  and the rights of  Residential  Funding  with respect to any Pledged
Assets,  Additional  Collateral  and the Surety  Bond  assigned  to the  Trustee
pursuant  to Section  2.01,  in trust for the use and benefit of all present and
future  Certificateholders.  The Trustee or Custodian  (the  Custodian  being so
obligated   under  a   Custodial   Agreement)   agrees,   for  the   benefit  of
Certificateholders,  to review each  Custodial  File delivered to it pursuant to
Section  2.01(b)  within 45 days after the Closing  Date to  ascertain  that all
required  documents  (specifically as set forth in Section  2.01(b)),  have been
executed and  received,  and that such  documents  relate to the Mortgage  Loans
identified  on the  Mortgage  Loan  Schedule,  as  supplemented,  that have been
conveyed  to it, and to  deliver  to the  Trustee a  certificate  (the  "Interim
Certification")  to the  effect  that all  documents  required  to be  delivered
pursuant to Section  2.01(b) above have been executed and received and that such
documents relate to the Mortgage Loans identified on the Mortgage Loan Schedule,
except  for any  exceptions  listed  on  Schedule  A  attached  to such  Interim
Certification. Upon delivery of the Custodial Files by the Company or the Master
Servicer,  the Trustee shall  acknowledge  receipt (or, with respect to Mortgage
Loans  subject to a  Custodial  Agreement,  and based  solely  upon a receipt or
certification executed by the Custodian,  receipt by the respective Custodian as
the duly appointed agent of the Trustee) of the documents referred to in Section
2.01(c) above.

      If the Custodian,  as the Trustee's agent, finds any document or documents
constituting a part of a Custodial File to be missing or defective,  the Trustee
shall  promptly  so notify the Master  Servicer  and the  Company.  Pursuant  to
Section 2.3 of the Custodial  Agreement,  the  Custodian  will notify the Master
Servicer, the Company and the Trustee of any such omission or defect found by it
in respect of any Custodial  File held by it in respect of the items reviewed by
it pursuant to the Custodial  Agreement.  If such omission or defect  materially
and  adversely  affects  the  interests  of the  Certificateholders,  the Master
Servicer shall promptly  notify  Residential  Funding of such omission or defect
and request Residential Funding to correct or cure such

                                       43
<PAGE>

omission or defect within 60 days from the date the Master Servicer was notified
of such omission or defect and, if Residential  Funding does not correct or cure
such  omission or defect  within such  period,  require  Residential  Funding to
purchase such Mortgage Loan from the Trust Fund at its Purchase Price, within 90
days from the date the Master  Servicer was notified of such omission or defect;
provided  that if the  omission or defect  would cause the  Mortgage  Loan to be
other than a "qualified  mortgage" as defined in Section 860G(a)(3) of the Code,
any such cure or repurchase  must occur within 90 days from the date such breach
was discovered. The Purchase Price for any such Mortgage Loan shall be deposited
by the Master  Servicer in the  Custodial  Account  maintained by it pursuant to
Section 3.07 and,  upon receipt by the Trustee of written  notification  of such
deposit signed by a Servicing Officer,  the Master Servicer,  the Trustee or the
Custodian,  as the  case may be,  shall  release  the  contents  of any  related
Mortgage  File in its  possession  to the owner of such  Mortgage  Loan (or such
owners'  designee) and the Trustee shall execute and deliver such instruments of
transfer or  assignment  prepared by the Master  Servicer,  in each case without
recourse,  as shall be necessary to vest in Residential  Funding or its designee
any Mortgage Loan released  pursuant  hereto and  thereafter  such Mortgage Loan
shall  not be part of the Trust  Fund.  It is  understood  and  agreed  that the
obligation of Residential Funding to so cure or purchase any Mortgage Loan as to
which a material  and adverse  defect in or omission of a  constituent  document
exists  shall  constitute  the sole  remedy  respecting  such defect or omission
available   to   Certificateholders   or   the   Trustee   on   behalf   of  the
Certificateholders.

      Section  2.03.  Representations,  Warranties  and  Covenants of the Master
                      Servicer and the Company.

      (a) The Master Servicer hereby  represents and warrants to the Trustee for
the benefit of the Certificateholders that as of the Closing Date:

            (i)  The  Master  Servicer  is  a  limited  liability  company  duly
      organized,  validly existing and in good standing under the laws governing
      its creation and existence  and is or will be in compliance  with the laws
      of each  state in which any  Mortgaged  Property  is located to the extent
      necessary to ensure the enforceability of each Mortgage Loan in accordance
      with the terms of this Agreement;

            (ii) The  execution  and  delivery of this  Agreement  by the Master
      Servicer  and its  performance  and  compliance  with  the  terms  of this
      Agreement will not violate the Master Servicer's  Certificate of Formation
      or Limited  Liability  Company  Agreement or constitute a material default
      (or an  event  which,  with  notice  or lapse  of  time,  or  both,  would
      constitute a material default) under, or result in the material breach of,
      any material  contract,  agreement or other instrument to which the Master
      Servicer is a party or which may be applicable  to the Master  Servicer or
      any of its assets;

            (iii) This  Agreement,  assuming due  authorization,  execution  and
      delivery by the Trustee and the Company,  constitutes  a valid,  legal and
      binding  obligation  of the  Master  Servicer,  enforceable  against it in
      accordance  with  the  terms  hereof  subject  to  applicable  bankruptcy,
      insolvency,  reorganization,  moratorium  and  other  laws  affecting  the
      enforcement of creditors'  rights  generally and to general  principles of
      equity,  regardless  of  whether  such  enforcement  is  considered  in  a
      proceeding in equity or at law;

                                       44
<PAGE>

            (iv) The Master Servicer is not in default with respect to any order
      or decree of any court or any order,  regulation or demand of any federal,
      state,   municipal  or  governmental  agency,  which  default  might  have
      consequences  that would  materially  and  adversely  affect the condition
      (financial  or  other)  or  operations  of  the  Master  Servicer  or  its
      properties  or might have  consequences  that would  materially  adversely
      affect its performance hereunder;

            (v) No  litigation  is  pending  or,  to  the  best  of  the  Master
      Servicer's  knowledge,  threatened against the Master Servicer which would
      prohibit its entering into this  Agreement or performing  its  obligations
      under this Agreement;

            (vi) The Master Servicer will comply in all material respects in the
      performance of this Agreement with all reasonable  rules and  requirements
      of each insurer under each Required Insurance Policy;

            (vii) No information, certificate of an officer, statement furnished
      in  writing or report  delivered  to the  Company,  any  Affiliate  of the
      Company or the Trustee by the Master  Servicer  will,  to the knowledge of
      the Master  Servicer,  contain any untrue  statement of a material fact or
      omit a  material  fact  necessary  to make the  information,  certificate,
      statement or report not misleading;

            (viii) The Master  Servicer has  examined  each  existing,  and will
      examine each new,  Subservicing  Agreement and is or will be familiar with
      the terms thereof. The terms of each existing  Subservicing  Agreement and
      each designated  Subservicer are acceptable to the Master Servicer and any
      new  Subservicing  Agreements  will comply with the  provisions of Section
      3.02; and

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

It is understood and agreed that the representations and warranties set forth in
this Section 2.03(a) shall survive delivery of the respective Custodial Files to
the Trustee or the Custodian.

      Upon discovery by either the Company, the Master Servicer,  the Trustee or
the  Custodian of a breach of any  representation  or warranty set forth in this
Section  2.03(a) which  materially  and  adversely  affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach shall
give  prompt  written  notice  to the  other  parties  (the  Custodian  being so
obligated under a Custodial  Agreement).  Within 90 days of its discovery or its
receipt of notice of such breach, the Master Servicer shall either (i) cure such
breach in all  material  respects or (ii) to the extent that such breach is with
respect to a Mortgage  Loan or a related  document,  purchase such Mortgage Loan
from the Trust Fund at the Purchase Price and in the manner set forth in Section
2.02;  provided  that if the omission or defect would cause the Mortgage Loan to
be other than a  "qualified  mortgage" as defined in Section  860G(a)(3)  of the
Code,  any such cure or repurchase  must occur within 90 days from the date such
breach was discovered. The obligation of the Master Servicer to cure such breach
or to so purchase such Mortgage Loan shall constitute the sole remedy in respect
of a breach of a representation and warranty set forth in this

                                       45
<PAGE>

Section 2.03(a) available to the  Certificateholders or the Trustee on behalf of
the Certificateholders.

      (b)  Representations and warranties relating to the Mortgage Loans are set
forth in Section 2.03(b) of the Series Supplement.

      Section 2.04. Representations and Warranties of Residential Funding.

      The  Company,  as assignee of  Residential  Funding  under the  Assignment
Agreement,  hereby assigns to the Trustee for the benefit of  Certificateholders
all of its right,  title and  interest  in respect of the  Assignment  Agreement
applicable to a Mortgage Loan.  Insofar as the Assignment  Agreement  relates to
the  representations  and warranties  made by Residential  Funding in respect of
such Mortgage Loan and any remedies  provided  thereunder for any breach of such
representations  and warranties,  such right, title and interest may be enforced
by the Master Servicer on behalf of the Trustee and the Certificateholders. Upon
the discovery by the Company, the Master Servicer,  the Trustee or the Custodian
of a breach of any of the  representations and warranties made in the Assignment
Agreement (which, for purposes hereof, will be deemed to include any other cause
giving  rise to a  repurchase  obligation  under the  Assignment  Agreement)  in
respect  of any  Mortgage  Loan  which  materially  and  adversely  affects  the
interests of the Certificateholders in such Mortgage Loan, the party discovering
such breach shall give prompt written notice to the other parties (the Custodian
being so  obligated  under a Custodial  Agreement).  The Master  Servicer  shall
promptly notify Residential  Funding of such breach and request that Residential
Funding either (i) cure such breach in all material respects within 90 days from
the date the Master  Servicer was notified of such breach or (ii)  purchase such
Mortgage  Loan from the Trust Fund at the  Purchase  Price and in the manner set
forth in Section 2.02;  provided that Residential  Funding shall have the option
to  substitute a Qualified  Substitute  Mortgage Loan or Loans for such Mortgage
Loan if such  substitution  occurs within two years  following the Closing Date;
provided  that if the breach  would cause the  Mortgage  Loan to be other than a
"qualified  mortgage"  as defined in Section  860G(a)(3)  of the Code,  any such
cure,  repurchase  or  substitution  must occur within 90 days from the date the
breach was discovered.  If a breach of the Compliance  With Laws  Representation
has given rise to the  obligation  to  repurchase  or substitute a Mortgage Loan
pursuant  to Section 4 of the  Assignment  Agreement,  then the Master  Servicer
shall request that Residential Funding pay to the Trust Fund,  concurrently with
and in addition to the remedies  provided in the preceding  sentence,  an amount
equal to any liability,  penalty or expense that was actually  incurred and paid
out of or on behalf of the Trust  Fund,  and that  directly  resulted  from such
breach, or if incurred and paid by the Trust Fund thereafter,  concurrently with
such  payment.  In the event that  Residential  Funding  elects to  substitute a
Qualified Substitute Mortgage Loan or Loans for a Deleted Mortgage Loan pursuant
to this Section  2.04,  Residential  Funding shall deliver to the Trustee or the
Custodian  for  the  benefit  of the  Certificateholders  with  respect  to such
Qualified  Substitute  Mortgage Loan or Loans,  the original  Mortgage Note, the
Mortgage, an Assignment of the Mortgage in recordable form, if required pursuant
to Section  2.01,  and such other  documents  and  agreements as are required by
Section  2.01,  with the Mortgage  Note endorsed as required by Section 2.01. No
substitution will be made in any calendar month after the Determination Date for
such month.  Monthly Payments due with respect to Qualified  Substitute Mortgage
Loans in the month of substitution  shall not be part of the Trust Fund and will
be  retained  by the Master  Servicer  and  remitted  by the Master  Servicer to
Residential Funding on the next succeeding Distribution Date.

                                       46
<PAGE>

For the month of  substitution,  distributions  to the  Certificateholders  will
include the Monthly  Payment due on a Deleted  Mortgage  Loan for such month and
thereafter  Residential Funding shall be entitled to retain all amounts received
in respect of such Deleted  Mortgage  Loan.  The Master  Servicer shall amend or
cause to be amended the Mortgage  Loan  Schedule,  and, if the Deleted  Mortgage
Loan was a Discount Mortgage Loan, the Schedule of Discount  Fractions,  for the
benefit  of the  Certificateholders  to  reflect  the  removal  of such  Deleted
Mortgage Loan and the substitution of the Qualified  Substitute Mortgage Loan or
Loans and the Master Servicer shall deliver the amended  Mortgage Loan Schedule,
and, if the Deleted  Mortgage  Loan was a Discount  Mortgage  Loan,  the amended
Schedule of Discount  Fractions,  to the Trustee.  Upon such  substitution,  the
Qualified  Substitute  Mortgage  Loan or Loans  shall be subject to the terms of
this  Agreement  and  the  related  Subservicing   Agreement  in  all  respects,
Residential  Funding  shall  be  deemed  to have  made the  representations  and
warranties with respect to the Qualified  Substitute  Mortgage Loan contained in
the related Assignment Agreement,  and the Company and the Master Servicer shall
be deemed to have made with respect to any Qualified Substitute Mortgage Loan or
Loans,  as of the  date of  substitution,  the  covenants,  representations  and
warranties set forth in this Section 2.04, in Section 2.03 hereof and in Section
4 of the  Assignment  Agreement,  and the Master  Servicer shall be obligated to
repurchase or substitute for any Qualified  Substitute Mortgage Loan as to which
a  Repurchase  Event (as  defined  in the  Assignment  Agreement)  has  occurred
pursuant to Section 4 of the Assignment Agreement.

      In connection with the  substitution  of one or more Qualified  Substitute
Mortgage Loans for one or more Deleted  Mortgage Loans, the Master Servicer will
determine  the amount (if any) by which the aggregate  principal  balance of all
such Qualified  Substitute Mortgage Loans as of the date of substitution is less
than the aggregate Stated  Principal  Balance of all such Deleted Mortgage Loans
(in each case after application of the principal portion of the Monthly Payments
due  in  the  month  of   substitution   that  are  to  be  distributed  to  the
Certificateholders  in the month of  substitution).  Residential  Funding  shall
deposit the amount of such  shortfall  into the Custodial  Account on the day of
substitution, without any reimbursement therefor. Residential Funding shall give
notice  in  writing  to the  Trustee  of  such  event,  which  notice  shall  be
accompanied by an Officers'  Certificate as to the calculation of such shortfall
and  (subject to Section  10.01(f))  by an Opinion of Counsel to the effect that
such  substitution will not cause (a) any federal tax to be imposed on the Trust
Fund,  including  without  limitation,  any federal  tax imposed on  "prohibited
transactions"  under Section  860F(a)(1) of the Code or on "contributions  after
the startup date" under Section 860G(d)(1) of the Code or (b) any portion of any
REMIC  to  fail  to  qualify  as  such  at any  time  that  any  Certificate  is
outstanding.

      It is understood and agreed that the obligation of Residential  Funding to
cure such breach or purchase,  or to substitute for, a Mortgage Loan as to which
such a breach has occurred and is continuing and to make any additional payments
required  under the  Assignment  Agreement  in  connection  with a breach of the
Compliance With Laws Representation  shall constitute the sole remedy respecting
such  breach  available  to the  Certificateholders  or the Trustee on behalf of
Certificateholders.  If the Master  Servicer is  Residential  Funding,  then the
Trustee  shall  also have the right to give the  notification  and  require  the
purchase or substitution  provided for in the second preceding  paragraph in the
event of such a breach  of a  representation  or  warranty  made by  Residential
Funding in the  Assignment  Agreement.  In  connection  with the  purchase of or
substitution  for any such Mortgage  Loan by  Residential  Funding,  the Trustee
shall assign to

                                       47
<PAGE>

Residential Funding all of the Trustee's right, title and interest in respect of
the Assignment Agreement applicable to such Mortgage Loan.

      Section 2.05.  Execution and  Authentication of  Certificates/Issuance  of
                     Certificates Evidencing Interests in REMIC I Certificates.

            As provided in Section 2.05 of the Series Supplement.

      Section 2.06.  Conveyance of  Uncertificated  REMIC I and REMIC II Regular
                     Interests; Acceptance by the Trustee.

            As provided in Section 2.06 of the Series Supplement.

      Section 2.07. Issuance of Certificates Evidencing Interests in REMIC II.

            As provided in Section 2.07 of the Series Supplement.

      Section 2.08. Purposes and Powers of the Trust.

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

      (a) to sell the  Certificates  to the Company in exchange for the Mortgage
Loans;

      (b) to enter into and perform its obligations under this Agreement;

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

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

            The  trust  is  hereby   authorized   to  engage  in  the  foregoing
activities. Notwithstanding the provisions of Section 11.01, the trust shall not
engage in any activity other than in connection with the foregoing or other than
as required or authorized by the terms of this Agreement  while any  Certificate
is outstanding, and this Section 2.08 may not be amended, without the consent of
the  Certificateholders  evidencing a majority of the aggregate Voting Rights of
the Certificates.

                                  Article III

                          ADMINISTRATION AND SERVICING
                                OF MORTGAGE LOANS

      Section 3.01. Master Servicer to Act as Servicer.

      (a) The Master Servicer shall service and administer the Mortgage Loans in
accordance  with the terms of this Agreement and the  respective  Mortgage Loans
and shall have full power and authority, acting alone or through Subservicers as
provided in Section 3.02, to do

                                       48
<PAGE>

any and all things which it may deem  necessary or desirable in connection  with
such  servicing  and  administration.  Without  limiting the  generality  of the
foregoing,  the Master  Servicer in its own name or in the name of a Subservicer
is hereby  authorized  and empowered by the Trustee when the Master  Servicer or
the  Subservicer,  as the  case  may be,  believes  it  appropriate  in its best
judgment,  to execute and deliver, on behalf of the  Certificateholders  and the
Trustee or any of them, any and all instruments of satisfaction or cancellation,
or of  partial or full  release or  discharge,  or of consent to  assumption  or
modification in connection with a proposed  conveyance,  or of assignment of any
Mortgage and Mortgage Note in connection  with the repurchase of a Mortgage Loan
and all other  comparable  instruments,  or with respect to the  modification or
re-recording  of a Mortgage  for the purpose of  correcting  the  Mortgage,  the
subordination  of the lien of the Mortgage in favor of a public utility  company
or government agency or unit with powers of eminent domain, the taking of a deed
in lieu of foreclosure, the commencement,  prosecution or completion of judicial
or  non-judicial  foreclosure,  the  conveyance  of a Mortgaged  Property to the
related Insurer, the acquisition of any property acquired by foreclosure or deed
in lieu of  foreclosure,  or the  management,  marketing  and  conveyance of any
property  acquired by foreclosure or deed in lieu of foreclosure with respect to
the Mortgage  Loans and with  respect to the  Mortgaged  Properties.  The Master
Servicer  further is authorized  and empowered by the Trustee,  on behalf of the
Certificateholders  and  the  Trustee,  in its own  name  or in the  name of the
Subservicer,  when the Master Servicer or the  Subservicer,  as the case may be,
believes it  appropriate  in its best  judgment to register any Mortgage Loan on
the MERS(R) System,  or cause the removal from the  registration of any Mortgage
Loan on the MERS(R) System, to execute and deliver, on behalf of the Trustee and
the Certificateholders or any of them, any and all instruments of assignment and
other comparable  instruments with respect to such assignment or re-recording of
a  Mortgage  in the name of MERS,  solely as  nominee  for the  Trustee  and its
successors  and assigns.  Any expenses  incurred in connection  with the actions
described in the  preceding  sentence  shall be borne by the Master  Servicer in
accordance with Section 3.16(c), with no right of reimbursement;  provided, that
if, as a result of MERS discontinuing or becoming unable to continue  operations
in connection with the MERS System,  it becomes necessary to remove any Mortgage
Loan from  registration  on the MERS System and to arrange for the assignment of
the  related  Mortgages  to the  Trustee,  then any  related  expenses  shall be
reimbursable to the Master Servicer.  Notwithstanding the foregoing,  subject to
Section  3.07(a),  the Master  Servicer shall not permit any  modification  with
respect to any  Mortgage  Loan that would both  constitute a sale or exchange of
such  Mortgage  Loan  within the  meaning  of  Section  1001 of the Code and any
proposed,  temporary or final regulations  promulgated thereunder (other than in
connection  with a proposed  conveyance or assumption of such Mortgage Loan that
is treated as a Principal Prepayment in Full pursuant to Section 3.13(d) hereof)
and cause any REMIC formed under the Series  Supplement  to fail to qualify as a
REMIC under the Code.  The Trustee  shall  furnish the Master  Servicer with any
powers of attorney and other  documents  necessary or  appropriate to enable the
Master Servicer to service and administer the Mortgage Loans.  The Trustee shall
not be liable for any action  taken by the Master  Servicer  or any  Subservicer
pursuant  to such  powers  of  attorney.  In  servicing  and  administering  any
Nonsubserviced  Mortgage  Loan,  the Master  Servicer  shall,  to the extent not
inconsistent  with this  Agreement,  comply with the Program Guide as if it were
the  originator of such Mortgage Loan and had retained the servicing  rights and
obligations in respect thereof.  In connection with servicing and  administering
the Mortgage Loans, the Master Servicer and any Affiliate of the Master Servicer
(i) may perform services such as appraisals and brokerage services that are not

                                       49
<PAGE>

customarily  provided by servicers of mortgage  loans,  and shall be entitled to
reasonable  compensation  therefor in accordance with Section 3.10 and (ii) may,
at its own discretion and on behalf of the Trustee, obtain credit information in
the form of a "credit score" from a credit repository.

      (b) All costs  incurred  by the  Master  Servicer  or by  Subservicers  in
effecting the timely payment of taxes and assessments on the properties  subject
to the  Mortgage  Loans  shall  not,  for the  purpose  of  calculating  monthly
distributions to the Certificateholders,  be added to the amount owing under the
related Mortgage Loans,  notwithstanding that the terms of such Mortgage Loan so
permit,  and such costs shall be recoverable to the extent  permitted by Section
3.10(a)(ii).

      (c)  The  Master  Servicer  may  enter  into  one or  more  agreements  in
connection with the offering of pass-through  certificates  evidencing interests
in one or more of the  Certificates  providing  for the  payment  by the  Master
Servicer of amounts  received by the Master  Servicer as servicing  compensation
hereunder and required to cover certain  Prepayment  Interest  Shortfalls on the
Mortgage Loans, which payment obligation will thereafter be an obligation of the
Master Servicer hereunder.

      Section  3.02.   Subservicing   Agreements  Between  Master  Servicer  and
                       Subservicers; Enforcement  of  Subservicers' and Sellers'
                       Obligations.

      (a) The Master  Servicer  may continue in effect  Subservicing  Agreements
entered into by Residential  Funding and Subservicers prior to the execution and
delivery of this Agreement,  and may enter into new Subservicing Agreements with
Subservicers,  for  the  servicing  and  administration  of all or  some  of the
Mortgage Loans. Each Subservicer of a Mortgage Loan shall be entitled to receive
and retain,  as provided in the related  Subservicing  Agreement  and in Section
3.07, the related  Subservicing  Fee from payments of interest  received on such
Mortgage Loan after payment of all amounts required to be remitted to the Master
Servicer  in respect of such  Mortgage  Loan.  For any  Mortgage  Loan that is a
Nonsubserviced  Mortgage Loan, the Master  Servicer shall be entitled to receive
and retain an amount equal to the  Subservicing  Fee from  payments of interest.
Unless the context otherwise  requires,  references in this Agreement to actions
taken or to be taken by the Master  Servicer in  servicing  the  Mortgage  Loans
include  actions taken or to be taken by a  Subservicer  on behalf of the Master
Servicer.  Each Subservicing Agreement will be upon such terms and conditions as
are  generally   required  or  permitted  by  the  Program  Guide  and  are  not
inconsistent  with this Agreement and as the Master Servicer and the Subservicer
have agreed. A representative form of Subservicing  Agreement is attached hereto
as Exhibit  E. With the  approval  of the Master  Servicer,  a  Subservicer  may
delegate  its  servicing   obligations  to  third-party   servicers,   but  such
Subservicer will remain obligated under the related Subservicing Agreement.  The
Master  Servicer  and a  Subservicer  may enter  into  amendments  thereto  or a
different form of Subservicing  Agreement,  and the form referred to or included
in the Program Guide is merely  provided for information and shall not be deemed
to limit in any respect the discretion of the Master Servicer to modify or enter
into  different  Subservicing  Agreements;  provided,  however,  that  any  such
amendments  or  different  forms  shall be  consistent  with and not violate the
provisions of either this Agreement or the Program Guide in a manner which would
materially  and adversely  affect the interests of the  Certificateholders.  The
Program Guide and any other Subservicing Agreement entered into

                                       50
<PAGE>

between the Master Servicer and any Subservicer shall require the Subservicer to
accurately  and fully  report its  borrower  credit  files to each of the Credit
Repositories in a timely manner.

      (b) As part of its servicing  activities  hereunder,  the Master Servicer,
for the benefit of the Trustee  and the  Certificateholders,  shall use its best
reasonable  efforts to enforce the  obligations  of each  Subservicer  under the
related  Subservicing  Agreement  and of each Seller under the related  Seller's
Agreement  insofar as the Company's  rights with respect to Seller's  obligation
has  been   assigned  to  the  Trustee   hereunder,   to  the  extent  that  the
non-performance  of any such  Seller's  obligation  would  have a  material  and
adverse effect on a Mortgage Loan, including, without limitation, the obligation
to purchase a Mortgage Loan on account of defective documentation,  as described
in Section 2.02, or on account of a breach of a representation  or warranty,  as
described in Section 2.04. Such enforcement,  including, without limitation, the
legal prosecution of claims,  termination of Subservicing Agreements or Seller's
Agreements, as appropriate, and the pursuit of other appropriate remedies, shall
be in such form and carried out to such an extent and at such time as the Master
Servicer would employ in its good faith  business  judgment and which are normal
and usual in its general  mortgage  servicing  activities.  The Master  Servicer
shall  pay the  costs  of such  enforcement  at its own  expense,  and  shall be
reimbursed  therefor  only (i)  from a  general  recovery  resulting  from  such
enforcement to the extent, if any, that such recovery exceeds all amounts due in
respect of the related Mortgage Loan or (ii) from a specific  recovery of costs,
expenses or attorneys  fees against the party against whom such  enforcement  is
directed.  For  purposes  of  clarification  only,  the  parties  agree that the
foregoing  is not  intended  to, and does not,  limit the  ability of the Master
Servicer to be reimbursed for expenses that are incurred in connection  with the
enforcement  of a Seller's  obligations  (insofar as the  Company's  rights with
respect  to  such  Seller's  obligations  have  been  assigned  to  the  Trustee
hereunder) and are reimbursable pursuant to Section 3.10(a)(viii).

      Section 3.03. Successor Subservicers.

      The Master  Servicer  shall be  entitled  to  terminate  any  Subservicing
Agreement  that may exist in  accordance  with the terms and  conditions of such
Subservicing  Agreement and without any limitation by virtue of this  Agreement;
provided,  however,  that  in the  event  of  termination  of  any  Subservicing
Agreement by the Master Servicer or the  Subservicer,  the Master Servicer shall
either act as servicer of the related Mortgage Loan or enter into a Subservicing
Agreement with a successor  Subservicer  which will be bound by the terms of the
related  Subservicing  Agreement.  If the Master  Servicer or any  Affiliate  of
Residential  Funding  acts as  servicer,  it will not assume  liability  for the
representations  and  warranties of the  Subservicer  which it replaces.  If the
Master  Servicer   enters  into  a  Subservicing   Agreement  with  a  successor
Subservicer,  the  Master  Servicer  shall use  reasonable  efforts  to have the
successor  Subservicer assume liability for the  representations  and warranties
made by the terminated Subservicer in respect of the related Mortgage Loans and,
in the event of any such  assumption  by the successor  Subservicer,  the Master
Servicer may, in the exercise of its business  judgment,  release the terminated
Subservicer from liability for such representations and warranties.

      Section 3.04. Liability of the Master Servicer.

      Notwithstanding any Subservicing Agreement,  any of the provisions of this
Agreement relating to agreements or arrangements  between the Master Servicer or
a Subservicer or

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<PAGE>

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

      Section 3.05. No Contractual  Relationship Between Subservicer and Trustee
                    or Certificateholders.

      Any  Subservicing  Agreement  that  may be  entered  into  and  any  other
transactions or services  relating to the Mortgage Loans involving a Subservicer
in its capacity as such and not as an  originator  shall be deemed to be between
the  Subservicer  and  the  Master  Servicer  alone  and  the  Trustee  and  the
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights,  obligations,  duties or liabilities  with respect to the Subservicer in
its  capacity  as such  except  as set  forth in  Section  3.06.  The  foregoing
provision  shall  not in any way  limit a  Subservicer's  obligation  to cure an
omission or defect or to  repurchase  a Mortgage  Loan as referred to in Section
2.02 hereof.

      Section 3.06.  Assumption or  Termination  of  Subservicing  Agreements by
                     Trustee.

      (a) If the  Master  Servicer  shall for any reason no longer be the master
servicer (including by reason of an Event of Default), the Trustee, its designee
or its successor shall thereupon assume all of the rights and obligations of the
Master  Servicer  under each  Subservicing  Agreement that may have been entered
into. The Trustee,  its designee or the successor servicer for the Trustee shall
be deemed to have assumed all of the Master  Servicer's  interest therein and to
have replaced the Master  Servicer as a party to the  Subservicing  Agreement to
the same  extent  as if the  Subservicing  Agreement  had been  assigned  to the
assuming party except that the Master  Servicer shall not thereby be relieved of
any liability or obligations under the Subservicing Agreement.

      (b) The Master  Servicer  shall,  upon  request of the  Trustee but at the
expense of the Master Servicer,  deliver to the assuming party all documents and
records  relating to each  Subservicing  Agreement  and the Mortgage  Loans then
being  serviced  and an  accounting  of  amounts  collected  and  held by it and
otherwise use its best efforts to effect the orderly and  efficient  transfer of
each Subservicing Agreement to the assuming party.

      Section 3.07.  Collection of Certain  Mortgage Loan Payments;  Deposits to
                     Custodial Account.

      (a) The Master  Servicer  shall  make  reasonable  efforts to collect  all
payments  called for under the terms and provisions of the Mortgage  Loans,  and
shall, to the extent such procedures shall be consistent with this Agreement and
the terms and provisions of any related Primary  Insurance  Policy,  follow such
collection procedures as it would employ in its good faith

                                       52
<PAGE>

business  judgment  and  which are  normal  and  usual in its  general  mortgage
servicing activities.  Consistent with the foregoing, the Master Servicer may in
its discretion  (i) waive any late payment  charge or any  prepayment  charge or
penalty  interest in connection  with the prepayment of a Mortgage Loan and (ii)
extend the Due Date for payments due on a Mortgage Loan in  accordance  with the
Program Guide; provided, however, that the Master Servicer shall first determine
that any such waiver or  extension  will not impair the  coverage of any related
Primary Insurance Policy or materially  adversely affect the lien of the related
Mortgage.  Notwithstanding  anything in this Section to the contrary, the Master
Servicer  shall  not  enforce  any  prepayment  charge to the  extent  that such
enforcement  would  violate  any  applicable  law.  In the  event  of  any  such
arrangement,  the Master  Servicer  shall make  timely  advances  on the related
Mortgage Loan during the scheduled  period in accordance  with the  amortization
schedule of such  Mortgage Loan without  modification  thereof by reason of such
arrangements  unless  otherwise  agreed  to by the  Holders  of the  Classes  of
Certificates affected thereby;  provided,  however, that no such extension shall
be made if any such advance would be a Nonrecoverable  Advance.  Consistent with
the terms of this Agreement,  the Master Servicer may also waive, modify or vary
any  term  of any  Mortgage  Loan  or  consent  to the  postponement  of  strict
compliance with any such term or in any manner grant indulgence to any Mortgagor
if  in  the  Master   Servicer's   determination   such  waiver,   modification,
postponement  or  indulgence is not  materially  adverse to the interests of the
Certificateholders  (taking into account any estimated  Realized Loss that might
result absent such action); provided,  however, that the Master Servicer may not
modify  materially  or permit  any  Subservicer  to modify  any  Mortgage  Loan,
including  without  limitation any  modification  that would change the Mortgage
Rate,  forgive the payment of any  principal or interest  (unless in  connection
with the  liquidation of the related  Mortgage Loan or except in connection with
prepayments to the extent that such  reamortization is not inconsistent with the
terms of the Mortgage  Loan),  capitalize any amounts owing on the Mortgage Loan
by adding such amount to the outstanding principal balance of the Mortgage Loan,
or extend the final  maturity date of such Mortgage  Loan,  unless such Mortgage
Loan is in default or, in the judgment of the Master  Servicer,  such default is
reasonably foreseeable;  provided,  further, that (1) no such modification shall
reduce the interest rate on a Mortgage Loan below  one-half of the Mortgage Rate
as in  effect  on the  Cut-off  Date,  but not less than the sum of the rates at
which the Servicing Fee and the  Subservicing  Fee with respect to such Mortgage
Loan accrues plus the rate at which the premium paid to the Certificate Insurer,
if any, accrues,  (2) the final maturity date for any Mortgage Loan shall not be
extended  beyond the  Maturity  Date,  (3) the Stated  Principal  Balance of all
Reportable Modified Mortgage Loans subject to Servicing  Modifications (measured
at the  time of the  Servicing  Modification  and  after  giving  effect  to any
Servicing  Modification)  can be no more  than  five  percent  of the  aggregate
principal  balance of the  Mortgage  Loans as of the Cut-off  Date,  unless such
limit is increased from time to time with the consent of the Rating Agencies and
the Certificate  Insurer,  if any. In addition,  any amounts owing on a Mortgage
Loan added to the  outstanding  principal  balance of such Mortgage Loan must be
fully  amortized over the remaining term of such Mortgage Loan, and such amounts
may be added to the outstanding  principal  balance of a Mortgage Loan only once
during the life of such  Mortgage  Loan.  Also,  the  addition  of such  amounts
described in the preceding  sentence shall be implemented in accordance with the
Program  Guide  and may be  implemented  only by  Subservicers  that  have  been
approved  by the  Master  Servicer  for such  purpose.  In  connection  with any
Curtailment  of a  Mortgage  Loan,  the  Master  Servicer,  to  the  extent  not
inconsistent with the terms of the Mortgage Note and local law and practice, may
permit the Mortgage Loan

                                       53
<PAGE>

to be reamortized  such that the Monthly  Payment is  recalculated  as an amount
that will fully amortize the remaining Stated  Principal  Balance thereof by the
original Maturity Date based on the original Mortgage Rate; provided,  that such
re-amortization  shall not be permitted if it would  constitute a reissuance  of
the Mortgage Loan for federal income tax purposes,  except if such reissuance is
described in Treasury Regulation Section 1.860G-2(b)(3).

      (b) The Master Servicer shall  establish and maintain a Custodial  Account
in which the Master  Servicer  shall deposit or cause to be deposited on a daily
basis, except as otherwise  specifically provided herein, the following payments
and  collections  remitted by  Subservicers  or received by it in respect of the
Mortgage  Loans  subsequent  to the  Cut-off  Date  (other  than in  respect  of
principal and interest on the Mortgage Loans due on or before the Cut-off Date):

            (i) All  payments  on  account  of  principal,  including  Principal
      Prepayments  made by  Mortgagors  on the Mortgage  Loans and the principal
      component of any  Subservicer  Advance or of any REO Proceeds  received in
      connection with an REO Property for which an REO Disposition has occurred;

            (ii) All  payments on account of interest at the  Adjusted  Mortgage
      Rate on the  Mortgage  Loans,  including  Buydown  Funds,  if any, and the
      interest  component  of any  Subservicer  Advance  or of any REO  Proceeds
      received in connection  with an REO Property for which an REO  Disposition
      has occurred;

            (iii)  Insurance  Proceeds,  Subsequent  Recoveries and  Liquidation
      Proceeds (net of any related expenses of the Subservicer);

            (iv) All  proceeds  of any  Mortgage  Loans  purchased  pursuant  to
      Section  2.02,  2.03,  2.04  or  4.07  (including  amounts  received  from
      Residential  Funding  pursuant to the last  paragraph  of Section 4 of the
      Assignment Agreement in respect of any liability,  penalty or expense that
      resulted from a breach of the Compliance With Laws  Representation and all
      amounts  required to be deposited in connection with the substitution of a
      Qualified Substitute Mortgage Loan pursuant to Section 2.03 or 2.04;

            (v) Any amounts required to be deposited pursuant to Section 3.07(c)
      or 3.21;

            (vi) All amounts  transferred  from the  Certificate  Account to the
      Custodial Account in accordance with Section 4.02(a);

            (vii) Any amounts  realized by the  Subservicer  and received by the
      Master Servicer in respect of any Additional Collateral; and

            (viii) Any  amounts  received  by the Master  Servicer in respect of
      Pledged Assets.

The  foregoing  requirements  for  deposit  in the  Custodial  Account  shall be
exclusive,  it being understood and agreed that, without limiting the generality
of the foregoing, payments on the Mortgage Loans which are not part of the Trust
Fund  (consisting  of  payments  in respect of  principal  and  interest  on the
Mortgage  Loans due on or before the Cut-off  Date) and,  unless  otherwise  set
forth in the  series  supplement,  payments  or  collections  in the  nature  of
prepayment

                                       54
<PAGE>

charges or late payment charges or assumption fees may but need not be deposited
by the Master  Servicer in the  Custodial  Account.  In the event any amount not
required to be deposited in the Custodial  Account is so  deposited,  the Master
Servicer may at any time withdraw such amount from the  Custodial  Account,  any
provision  herein to the contrary  notwithstanding.  The  Custodial  Account may
contain  funds  that  belong to one or more trust  funds  created  for  mortgage
pass-through certificates of other series and may contain other funds respecting
payments  on  mortgage  loans  belonging  to the Master  Servicer or serviced or
master serviced by it on behalf of others.  Notwithstanding  such commingling of
funds, the Master Servicer shall keep records that accurately  reflect the funds
on deposit in the  Custodial  Account that have been  identified  by it as being
attributable to the Mortgage Loans.

      With respect to Insurance Proceeds, Liquidation Proceeds, REO Proceeds and
the  proceeds of the purchase of any Mortgage  Loan  pursuant to Sections  2.02,
2.03,  2.04 and 4.07  received in any calendar  month,  the Master  Servicer may
elect to treat such amounts as included in the Available Distribution Amount for
the Distribution Date in the month of receipt, but is not obligated to do so. If
the Master Servicer so elects, such amounts will be deemed to have been received
(and any related Realized Loss shall be deemed to have occurred) on the last day
of the month prior to the receipt thereof.

      (c)  The  Master  Servicer  shall  use  its  best  efforts  to  cause  the
institution  maintaining  the  Custodial  Account  to  invest  the  funds in the
Custodial  Account  attributable to the Mortgage Loans in Permitted  Investments
which shall  mature not later than the  Certificate  Account  Deposit  Date next
following the date of such investment (with the exception of the Amount Held for
Future  Distribution)  and which shall not be sold or disposed of prior to their
maturities.  All income and gain realized from any such investment  shall be for
the benefit of the Master  Servicer as  additional  servicing  compensation  and
shall be subject to its withdrawal or order from time to time. The amount of any
losses  incurred  in  respect  of  any  such  investments  attributable  to  the
investment of amounts in respect of the Mortgage Loans shall be deposited in the
Custodial  Account by the Master  Servicer out of its own funds  immediately  as
realized without any right of reimbursement.

      (d) The Master  Servicer  shall give notice to the Trustee and the Company
of any change in the location of the  Custodial  Account and the location of the
Certificate Account prior to the use thereof.

      Section 3.08. Subservicing Accounts; Servicing Accounts.

      (a) In those  cases  where a  Subservicer  is  servicing  a Mortgage  Loan
pursuant  to a  Subservicing  Agreement,  the Master  Servicer  shall  cause the
Subservicer,  pursuant to the Subservicing  Agreement, to establish and maintain
one or more Subservicing Accounts which shall be an Eligible Account or, if such
account is not an Eligible Account,  shall generally satisfy the requirements of
the Program Guide and be otherwise  acceptable  to the Master  Servicer and each
Rating  Agency.  The  Subservicer  will be required  thereby to deposit into the
Subservicing Account on a daily basis all proceeds of Mortgage Loans received by
the  Subservicer,  less its  Subservicing  Fees and  unreimbursed  advances  and
expenses,  to  the  extent  permitted  by  the  Subservicing  Agreement.  If the
Subservicing  Account is not an Eligible  Account,  the Master Servicer shall be
deemed to have received such monies upon receipt thereof by the Subservicer.

                                       55
<PAGE>

The  Subservicer  shall not be required to deposit in the  Subservicing  Account
payments or collections  in the nature of prepayment  charges or late charges or
assumption fees. On or before the date specified in the Program Guide, but in no
event later than the  Determination  Date,  the Master  Servicer shall cause the
Subservicer,  pursuant  to the  Subservicing  Agreement,  to remit to the Master
Servicer for deposit in the Custodial Account all funds held in the Subservicing
Account with respect to each Mortgage Loan serviced by such Subservicer that are
required to be remitted to the Master  Servicer.  The  Subservicer  will also be
required,  pursuant to the Subservicing  Agreement, to advance on such scheduled
date of  remittance  amounts  equal to any  scheduled  monthly  installments  of
principal  and interest  less its  Subservicing  Fees on any Mortgage  Loans for
which payment was not received by the  Subservicer.  This  obligation to advance
with respect to each  Mortgage  Loan will continue up to and including the first
of the month following the date on which the related Mortgaged  Property is sold
at a  foreclosure  sale  or is  acquired  by the  Trust  Fund by deed in lieu of
foreclosure  or  otherwise.  All such advances  received by the Master  Servicer
shall be deposited promptly by it in the Custodial Account.

      (b) The  Subservicer  may also be required,  pursuant to the  Subservicing
Agreement,  to remit to the Master Servicer for deposit in the Custodial Account
interest at the Adjusted  Mortgage  Rate (or Modified Net Mortgage Rate plus the
rate per annum at which the  Servicing  Fee  accrues  in the case of a  Modified
Mortgage Loan) on any Curtailment  received by such  Subservicer in respect of a
Mortgage Loan from the related  Mortgagor during any month that is to be applied
by the  Subservicer  to reduce  the  unpaid  principal  balance  of the  related
Mortgage Loan as of the first day of such month, from the date of application of
such  Curtailment to the first day of the following month. Any amounts paid by a
Subservicer  pursuant to the preceding  sentence shall be for the benefit of the
Master Servicer as additional servicing compensation and shall be subject to its
withdrawal or order from time to time pursuant to Sections 3.10(a)(iv) and (v).

      (c) In addition to the Custodial Account and the Certificate  Account, the
Master Servicer shall for any Nonsubserviced  Mortgage Loan, and shall cause the
Subservicers  for Subserviced  Mortgage Loans to,  establish and maintain one or
more Servicing  Accounts and deposit and retain therein all collections from the
Mortgagors   (or  advances  from   Subservicers)   for  the  payment  of  taxes,
assessments,  hazard insurance premiums,  Primary Insurance Policy premiums,  if
applicable,  or  comparable  items  for  the  account  of the  Mortgagors.  Each
Servicing Account shall satisfy the requirements for a Subservicing Account and,
to the extent  permitted by the Program  Guide or as is otherwise  acceptable to
the Master Servicer, may also function as a Subservicing Account. Withdrawals of
amounts  related to the Mortgage  Loans from the Servicing  Accounts may be made
only to effect timely payment of taxes, assessments,  hazard insurance premiums,
Primary  Insurance  Policy  premiums,  if applicable,  or comparable  items,  to
reimburse the Master Servicer or Subservicer out of related  collections for any
payments made  pursuant to Sections 3.11 (with respect to the Primary  Insurance
Policy)  and  3.12(a)  (with  respect  to  hazard  insurance),  to refund to any
Mortgagors  any sums as may be  determined to be overages,  to pay interest,  if
required,  to Mortgagors  on balances in the  Servicing  Account or to clear and
terminate  the  Servicing  Account  at the  termination  of  this  Agreement  in
accordance with Section 9.01 or in accordance with the Program Guide. As part of
its servicing  duties,  the Master Servicer shall,  and the  Subservicers  will,
pursuant to the  Subservicing  Agreements,  be required to pay to the Mortgagors
interest on funds in this account to the extent required by law.

                                       56
<PAGE>

      (d) The Master  Servicer  shall  advance the  payments  referred to in the
preceding  subsection  that are not timely paid by the Mortgagors or advanced by
the  Subservicers on the date when the tax, premium or other cost for which such
payment is  intended  is due,  but the Master  Servicer  shall be required so to
advance only to the extent that such advances, in the good faith judgment of the
Master  Servicer,  will be recoverable  by the Master  Servicer out of Insurance
Proceeds, Liquidation Proceeds or otherwise.

      Section 3.09. Access to Certain  Documentation  and Information  Regarding
                    the Mortgage Loans.

      If compliance  with this Section 3.09 shall make any Class of Certificates
legal for investment by federally  insured  savings and loan  associations,  the
Master  Servicer shall provide,  or cause the  Subservicers  to provide,  to the
Trustee, the Office of Thrift Supervision or the FDIC and the supervisory agents
and examiners thereof access to the  documentation  regarding the Mortgage Loans
required by applicable  regulations  of the Office of Thrift  Supervision,  such
access being afforded without charge but only upon reasonable request and during
normal  business  hours at the offices  designated by the Master  Servicer.  The
Master  Servicer  shall  permit  such  representatives  to  photocopy  any  such
documentation  and  shall  provide  equipment  for  that  purpose  at  a  charge
reasonably approximating the cost of such photocopying to the Master Servicer.

      Section 3.10. Permitted Withdrawals from the Custodial Account.

      (a) The Master  Servicer may, from time to time as provided  herein,  make
withdrawals from the Custodial Account of amounts on deposit therein pursuant to
Section  3.07 that are  attributable  to the  Mortgage  Loans for the  following
purposes:

            (i) to make deposits into the Certificate Account in the amounts and
      in the manner provided for in Section 4.01;

            (ii) to reimburse  itself or the related  Subservicer for previously
      unreimbursed Advances,  Servicing Advances or other expenses made pursuant
      to Sections 3.01, 3.07(a), 3.08, 3.11, 3.12(a), 3.14 and 4.04 or otherwise
      reimbursable  pursuant  to the terms of this  Agreement,  such  withdrawal
      right being  limited to amounts  received on the  related  Mortgage  Loans
      (including,   for  this  purpose,   REO  Proceeds,   Insurance   Proceeds,
      Liquidation  Proceeds  and proceeds  from the purchase of a Mortgage  Loan
      pursuant to Section  2.02,  2.03,  2.04 or 4.07) which  represent (A) Late
      Collections of Monthly Payments for which any such advance was made in the
      case of Subservicer  Advances or Advances pursuant to Section 4.04 and (B)
      recoveries  of amounts in respect of which such  advances were made in the
      case of Servicing Advances;

            (iii) to pay to itself or the related Subservicer (if not previously
      retained by such  Subservicer)  out of each payment received by the Master
      Servicer  on account of  interest on a Mortgage  Loan as  contemplated  by
      Sections 3.14 and 3.16, an amount equal to that  remaining  portion of any
      such payment as to interest  (but not in excess of the  Servicing  Fee and
      the Subservicing  Fee, if not previously  retained) which,  when deducted,
      will result in the remaining amount of such interest being interest at the
      Net

                                       57
<PAGE>

      Mortgage  Rate (or Modified  Net  Mortgage  Rate in the case of a Modified
      Mortgage Loan) on the amount specified in the amortization schedule of the
      related Mortgage Loan as the principal balance thereof at the beginning of
      the period  respecting which such interest was paid after giving effect to
      any previous Curtailments;

            (iv) to pay to  itself  as  additional  servicing  compensation  any
      interest or investment income earned on funds and other property deposited
      in or credited to the  Custodial  Account  that it is entitled to withdraw
      pursuant to Section 3.07(c);

            (v)  to pay to  itself  as  additional  servicing  compensation  any
      Foreclosure  Profits,  any amounts remitted by Subservicers as interest in
      respect of Curtailments  pursuant to Section 3.08(b), and any amounts paid
      by a  Mortgagor  in  connection  with a  Principal  Prepayment  in Full in
      respect of interest for any period during the calendar month in which such
      Principal   Prepayment   in   Full   is   to   be   distributed   to   the
      Certificateholders;

            (vi) to pay to itself, a Subservicer, a Seller, Residential Funding,
      the  Company or any other  appropriate  Person,  as the case may be,  with
      respect to each Mortgage Loan or property acquired in respect thereof that
      has been  purchased or  otherwise  transferred  pursuant to Section  2.02,
      2.03, 2.04, 4.07 or 9.01, all amounts received thereon and not required to
      be  distributed  to the  Certificateholders  as of the date on  which  the
      related Stated Principal Balance or Purchase Price is determined;

            (vii)  to  reimburse  itself  or the  related  Subservicer  for  any
      Nonrecoverable  Advance  or  Advances  in the  manner  and  to the  extent
      provided in  subsection  (c) below,  and any Advance or Servicing  Advance
      made in connection with a modified Mortgage Loan that is in default or, in
      the judgment of the Master  Servicer,  default is  reasonably  foreseeable
      pursuant  to Section  3.07(a),  to the extent the amount of the Advance or
      Servicing  Advance  was  added  to the  Stated  Principal  Balance  of the
      Mortgage Loan in a prior calendar  month,  or any Advance  reimbursable to
      the Master Servicer pursuant to Section 4.02(a);

            (viii)to  reimburse  itself or the Company for expenses  incurred by
      and reimbursable to it or the Company pursuant to Sections 3.01(a),  3.11,
      3.13, 3.14(c), 6.03, 10.01 or otherwise,  or in connection with enforcing,
      in  accordance  with  this  Agreement,  any  repurchase,  substitution  or
      indemnification  obligation  of any Seller (other than an Affiliate of the
      Company) pursuant to the related Seller's Agreement;

            (ix) to reimburse itself for Servicing  Advances  expended by it (a)
      pursuant to Section 3.14 in good faith in connection  with the restoration
      of property  damaged by an Uninsured Cause, and (b) in connection with the
      liquidation  of a Mortgage Loan or  disposition  of an REO Property to the
      extent not otherwise  reimbursed  pursuant to clause (ii) or (viii) above;
      and

            (x) to withdraw any amount  deposited in the Custodial  Account that
      was not required to be deposited therein pursuant to Section 3.07.

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<PAGE>

      (b) Since, in connection with withdrawals pursuant to clauses (ii), (iii),
(v)  and  (vi),  the  Master  Servicer's   entitlement  thereto  is  limited  to
collections  or other  recoveries  on the  related  Mortgage  Loan,  the  Master
Servicer  shall keep and maintain  separate  accounting,  on a Mortgage  Loan by
Mortgage  Loan basis,  for the purpose of  justifying  any  withdrawal  from the
Custodial Account pursuant to such clauses.

      (c) The Master  Servicer  shall be  entitled  to  reimburse  itself or the
related  Subservicer for any advance made in respect of a Mortgage Loan that the
Master Servicer determines to be a Nonrecoverable Advance by withdrawal from the
Custodial  Account of amounts on deposit  therein  attributable  to the Mortgage
Loans  on any  Certificate  Account  Deposit  Date  succeeding  the date of such
determination.  Such  right of  reimbursement  in  respect  of a  Nonrecoverable
Advance  relating to an Advance pursuant to Section 4.04 on any such Certificate
Account  Deposit Date shall be limited to an amount not exceeding the portion of
such  Advance  previously  paid  to  Certificateholders   (and  not  theretofore
reimbursed to the Master Servicer or the related Subservicer).

      Section 3.11.  Maintenance of the Primary Insurance Policies;  Collections
                     Thereunder.

      (a) The Master Servicer shall not take, or permit any Subservicer to take,
any action  which would  result in  non-coverage  under any  applicable  Primary
Insurance  Policy of any loss which,  but for the actions of the Master Servicer
or Subservicer,  would have been covered  thereunder.  To the extent coverage is
available,  the Master Servicer shall keep or cause to be kept in full force and
effect each such Primary  Insurance  Policy until the  principal  balance of the
related Mortgage Loan secured by a Mortgaged  Property is reduced to 80% or less
of  the  Appraised  Value  in  the  case  of  such  a  Mortgage  Loan  having  a
Loan-to-Value  Ratio at origination in excess of 80%, provided that such Primary
Insurance  Policy  was in  place as of the  Cut-off  Date  and the  Company  had
knowledge  of such  Primary  Insurance  Policy.  The  Master  Servicer  shall be
entitled to cancel or permit the discontinuation of any Primary Insurance Policy
as to any Mortgage Loan, if the Stated Principal Balance of the Mortgage Loan is
reduced  below an  amount  equal to 80% of the  appraised  value of the  related
Mortgaged  Property as  determined  in any  appraisal  thereof after the Closing
Date,  or if the  Loan-to-Value  Ratio  is  reduced  below  80% as a  result  of
principal  payments on the Mortgage  Loan after the Closing  Date.  In the event
that the Company  gains  knowledge  that as of the Closing Date, a Mortgage Loan
had a Loan-to-Value Ratio at origination in excess of 80% and is not the subject
of a Primary  Insurance  Policy (and was not  included in any  exception  to the
representation in Section 2.03(b)(iv)) and that such Mortgage Loan has a current
Loan-to-Value  Ratio in excess  of 80% then the  Master  Servicer  shall use its
reasonable  efforts to obtain and  maintain  a Primary  Insurance  Policy to the
extent  that such a policy is  obtainable  at a  reasonable  price.  The  Master
Servicer shall not cancel or refuse to renew any such Primary  Insurance  Policy
applicable to a  Nonsubserviced  Mortgage  Loan,  or consent to any  Subservicer
canceling or refusing to renew any such Primary Insurance Policy applicable to a
Mortgage  Loan  subserviced  by it, that is in effect at the date of the initial
issuance  of the  Certificates  and is  required  to be kept in force  hereunder
unless the replacement Primary Insurance Policy for such canceled or non-renewed
policy is maintained with an insurer whose  claims-paying  ability is acceptable
to each Rating  Agency for mortgage  pass-through  certificates  having a rating
equal to or better  than the  lower of the  then-current  rating  or the  rating
assigned to the Certificates as of the Closing Date by such Rating Agency.

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<PAGE>

      (b) In connection with its activities as administrator and servicer of the
Mortgage  Loans,  the Master  Servicer agrees to present or to cause the related
Subservicer to present,  on behalf of the Master Servicer,  the Subservicer,  if
any, the Trustee and Certificateholders, claims to the related Insurer under any
Primary Insurance Policies, in a timely manner in accordance with such policies,
and,  in this  regard,  to take or cause to be taken such  reasonable  action as
shall be  necessary  to permit  recovery  under any Primary  Insurance  Policies
respecting  defaulted  Mortgage  Loans.  Pursuant to Section 3.07, any Insurance
Proceeds  collected  by or  remitted  to the Master  Servicer  under any Primary
Insurance  Policies  shall be deposited  in the  Custodial  Account,  subject to
withdrawal pursuant to Section 3.10.

      Section  3.12.  Maintenance  of Fire  Insurance and Omissions and Fidelity
                      Coverage.

      (a) The Master  Servicer  shall cause to be  maintained  for each Mortgage
Loan (other than a Cooperative Loan) fire insurance with extended coverage in an
amount  which is equal to the  lesser  of the  principal  balance  owing on such
Mortgage  Loan  or 100  percent  of the  insurable  value  of the  improvements;
provided,  however,  that such coverage may not be less than the minimum  amount
required to fully compensate for any loss or damage on a replacement cost basis.
To the extent it may do so without breaching the related Subservicing Agreement,
the Master  Servicer  shall  replace  any  Subservicer  that does not cause such
insurance, to the extent it is available, to be maintained.  The Master Servicer
shall also cause to be maintained on property acquired upon foreclosure, or deed
in lieu of  foreclosure,  of any Mortgage Loan (other than a Cooperative  Loan),
fire  insurance  with extended  coverage in an amount which is at least equal to
the  amount  necessary  to avoid  the  application  of any  co-insurance  clause
contained in the related hazard insurance policy.  Pursuant to Section 3.07, any
amounts  collected by the Master  Servicer  under any such policies  (other than
amounts to be  applied to the  restoration  or repair of the  related  Mortgaged
Property  or property  thus  acquired or amounts  released to the  Mortgagor  in
accordance with the Master  Servicer's  normal  servicing  procedures)  shall be
deposited in the Custodial  Account,  subject to withdrawal  pursuant to Section
3.10. Any cost incurred by the Master Servicer in maintaining any such insurance
shall  not,  for  the  purpose  of  calculating  monthly  distributions  to  the
Certificateholders,  be added to the  amount  owing  under  the  Mortgage  Loan,
notwithstanding  that the terms of the Mortgage Loan so permit. Such costs shall
be  recoverable  by the Master  Servicer  out of related  late  payments  by the
Mortgagor or out of Insurance  Proceeds and  Liquidation  Proceeds to the extent
permitted by Section  3.10.  It is  understood  and agreed that no earthquake or
other  additional  insurance is to be required of any Mortgagor or maintained on
property  acquired  in respect of a Mortgage  Loan other than  pursuant  to such
applicable  laws and  regulations  as shall at any time be in force and as shall
require such additional insurance. Whenever the improvements securing a Mortgage
Loan (other than a Cooperative  Loan) are located at the time of  origination of
such Mortgage  Loan in a federally  designated  special  flood hazard area,  the
Master  Servicer  shall cause flood  insurance  (to the extent  available) to be
maintained in respect thereof.  Such flood insurance shall be in an amount equal
to the lesser of (i) the amount required to compensate for any loss or damage to
the Mortgaged  Property on a replacement  cost basis and (ii) the maximum amount
of such  insurance  available  for the  related  Mortgaged  Property  under  the
national flood insurance program (assuming that the area in which such Mortgaged
Property is located is participating in such program).

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<PAGE>

      If the Master  Servicer shall obtain and maintain a blanket fire insurance
policy with  extended  coverage  insuring  against  hazard  losses on all of the
Mortgage  Loans,  it  shall   conclusively  be  deemed  to  have  satisfied  its
obligations as set forth in the first sentence of this Section 3.12(a), it being
understood and agreed that such policy may contain a deductible clause, in which
case the Master  Servicer  shall,  in the event  that there  shall not have been
maintained on the related  Mortgaged  Property a policy complying with the first
sentence  of this  Section  3.12(a) and there shall have been a loss which would
have been covered by such policy,  deposit in the Certificate Account the amount
not  otherwise  payable  under the  blanket  policy  because of such  deductible
clause. Any such deposit by the Master Servicer shall be made on the Certificate
Account  Deposit Date next preceding the  Distribution  Date which occurs in the
month  following  the month in which  payments  under any such policy would have
been deposited in the Custodial  Account.  In connection  with its activities as
administrator  and servicer of the Mortgage Loans, the Master Servicer agrees to
present,  on behalf of itself,  the Trustee and the  Certificateholders,  claims
under any such blanket policy.

      (b) The Master  Servicer  shall obtain and maintain at its own expense and
keep in full force and effect  throughout  the term of this  Agreement a blanket
fidelity bond and an errors and omissions  insurance  policy covering the Master
Servicer's  officers and  employees  and other  persons  acting on behalf of the
Master  Servicer in connection  with its activities  under this  Agreement.  The
amount  of  coverage  shall be at  least  equal to the  coverage  that  would be
required by Fannie Mae or Freddie Mac, whichever is greater, with respect to the
Master  Servicer if the Master  Servicer were  servicing and  administering  the
Mortgage Loans for Fannie Mae or Freddie Mac. In the event that any such bond or
policy  ceases to be in effect,  the Master  Servicer  shall obtain a comparable
replacement  bond or  policy  from an  issuer  or  insurer,  as the case may be,
meeting the  requirements,  if any, of the Program  Guide and  acceptable to the
Company.  Coverage of the Master  Servicer under a policy or bond obtained by an
Affiliate of the Master  Servicer and  providing  the coverage  required by this
Section 3.12(b) shall satisfy the requirements of this Section 3.12(b).

      Section  3.13.   Enforcement  of  Due-on-Sale   Clauses;   Assumption  and
                       Modification Agreements; Certain Assignments.

      (a) When any Mortgaged  Property is conveyed by the Mortgagor,  the Master
Servicer or  Subservicer,  to the extent it has  knowledge  of such  conveyance,
shall enforce any due-on-sale clause contained in any Mortgage Note or Mortgage,
to the extent permitted under applicable law and governmental  regulations,  but
only to the extent that such enforcement will not adversely affect or jeopardize
coverage under any Required Insurance Policy. Notwithstanding the foregoing:

            (i) the Master  Servicer  shall not be deemed to be in default under
      this  Section  3.13(a) by reason of any transfer or  assumption  which the
      Master Servicer is restricted by law from preventing; and

            (ii) if the Master Servicer  determines that it is reasonably likely
      that any  Mortgagor  will bring,  or if any  Mortgagor  does bring,  legal
      action to declare invalid or otherwise avoid  enforcement of a due-on-sale
      clause contained in any Mortgage Note or

                                       61
<PAGE>

      Mortgage,  the  Master  Servicer  shall not be  required  to  enforce  the
      due-on-sale clause or to contest such action.

      (b)  Subject to the Master  Servicer's  duty to  enforce  any  due-on-sale
clause  to the  extent  set  forth in  Section  3.13(a),  in any case in which a
Mortgaged Property is to be conveyed to a Person by a Mortgagor, and such Person
is to enter into an  assumption or  modification  agreement or supplement to the
Mortgage Note or Mortgage which requires the signature of the Trustee,  or if an
instrument of release signed by the Trustee is required  releasing the Mortgagor
from liability on the Mortgage Loan, the Master Servicer is authorized,  subject
to the requirements of the sentence next following,  to execute and deliver,  on
behalf of the  Trustee,  the  assumption  agreement  with the Person to whom the
Mortgaged  Property  is  to be  conveyed  and  such  modification  agreement  or
supplement  to the  Mortgage  Note  or  Mortgage  or  other  instruments  as are
reasonable  or necessary to carry out the terms of the Mortgage Note or Mortgage
or otherwise to comply with any  applicable  laws  regarding  assumptions or the
transfer of the Mortgaged Property to such Person;  provided,  however,  none of
such terms and requirements  shall either (i) both (A) constitute a "significant
modification"  effecting an exchange or  reissuance  of such Mortgage Loan under
the REMIC  Provisions  and (B) cause any portion of any REMIC  formed  under the
Series  Supplement  to fail to qualify as a REMIC  under the Code or (subject to
Section  10.01(f)),   result  in  the  imposition  of  any  tax  on  "prohibited
transactions" or (ii) constitute  "contributions"  after the start-up date under
the REMIC  Provisions.  The Master  Servicer  shall  execute  and  deliver  such
documents only if it reasonably  determines  that (i) its execution and delivery
thereof will not conflict  with or violate any terms of this  Agreement or cause
the unpaid  balance and interest on the  Mortgage  Loan to be  uncollectible  in
whole or in part,  (ii) any  required  consents of insurers  under any  Required
Insurance Policies have been obtained and (iii) subsequent to the closing of the
transaction  involving  the  assumption  or transfer (A) the Mortgage  Loan will
continue  to be secured by a first  mortgage  lien  pursuant to the terms of the
Mortgage,  (B) such transaction will not adversely affect the coverage under any
Required Insurance Policies,  (C) the Mortgage Loan will fully amortize over the
remaining term thereof, (D) no material term of the Mortgage Loan (including the
interest  rate on the  Mortgage  Loan) will be altered  nor will the term of the
Mortgage  Loan be  changed  and (E) if the  seller/transferor  of the  Mortgaged
Property is to be released  from  liability on the Mortgage  Loan,  such release
will  not  (based  on  the  Master   Servicer's  or  Subservicer's   good  faith
determination)  adversely affect the  collectability  of the Mortgage Loan. Upon
receipt of appropriate  instructions from the Master Servicer in accordance with
the  foregoing,  the Trustee shall execute any  necessary  instruments  for such
assumption  or  substitution  of  liability as directed in writing by the Master
Servicer.  Upon the closing of the transactions  contemplated by such documents,
the Master  Servicer shall cause the originals or true and correct copies of the
assumption agreement, the release (if any), or the modification or supplement to
the Mortgage  Note or Mortgage to be  delivered to the Trustee or the  Custodian
and deposited  with the Mortgage File for such Mortgage  Loan. Any fee collected
by the  Master  Servicer  or  such  related  Subservicer  for  entering  into an
assumption or substitution of liability agreement will be retained by the Master
Servicer or such Subservicer as additional servicing compensation.

      (c) The Master  Servicer or the related  Subservicer,  as the case may be,
shall be entitled to approve a request from a Mortgagor for a partial release of
the related Mortgaged Property,  the granting of an easement thereon in favor of
another Person,  any alteration or demolition of the related Mortgaged  Property
(or, with respect to a Cooperative Loan, the related

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<PAGE>

Cooperative  Apartment)  without  any right of  reimbursement  or other  similar
matters if it has determined, exercising its good faith business judgment in the
same manner as it would if it were the owner of the related  Mortgage Loan, that
the security for, and the timely and full  collectability of, such Mortgage Loan
would not be adversely affected thereby and that any portion of any REMIC formed
under the Series  Supplement  would not fail to  continue  to qualify as a REMIC
under the Code as a result thereof and (subject to Section 10.01(f)) that no tax
on "prohibited  transactions" or "contributions"  after the startup day would be
imposed on any such REMIC as a result  thereof.  Any fee collected by the Master
Servicer  or the  related  Subservicer  for  processing  such a request  will be
retained by the Master  Servicer or such  Subservicer  as  additional  servicing
compensation.

      (d)  Subject  to  any  other  applicable  terms  and  conditions  of  this
Agreement,  the  Trustee  and Master  Servicer  shall be  entitled to approve an
assignment in lieu of satisfaction  with respect to any Mortgage Loan,  provided
the  obligee  with  respect  to  such  Mortgage  Loan  following  such  proposed
assignment provides the Trustee and Master Servicer with a "Lender Certification
for  Assignment of Mortgage  Loan" in the form attached  hereto as Exhibit M, in
form and substance  satisfactory to the Trustee and Master  Servicer,  providing
the  following:  (i) that the substance of the assignment is, and is intended to
be, a refinancing  of such  Mortgage;  (ii) that the Mortgage Loan following the
proposed  assignment will have a rate of interest at least 0.25 percent below or
above  the  rate of  interest  on such  Mortgage  Loan  prior  to such  proposed
assignment;  and (iii) that such  assignment  is at the request of the  borrower
under the related  Mortgage  Loan.  Upon  approval of an  assignment  in lieu of
satisfaction  with  respect to any  Mortgage  Loan,  the Master  Servicer  shall
receive cash in an amount equal to the unpaid  principal  balance of and accrued
interest on such Mortgage Loan and the Master  Servicer  shall treat such amount
as a Principal  Prepayment  in Full with respect to such  Mortgage  Loan for all
purposes hereof.

      Section 3.14. Realization Upon Defaulted Mortgage Loans.

      (a) The Master  Servicer  shall  foreclose  upon or  otherwise  comparably
convert  (which may include an REO  Acquisition)  the  ownership  of  properties
securing such of the Mortgage  Loans as come into and continue in default and as
to which no satisfactory  arrangements  can be made for collection of delinquent
payments pursuant to Section 3.07.  Alternatively,  the Master Servicer may take
other  actions in respect of a defaulted  Mortgage  Loan,  which may include (i)
accepting  a short sale (a payoff of the  Mortgage  Loan for an amount less than
the  total  amount  contractually  owed in  order  to  facilitate  a sale of the
Mortgaged Property by the Mortgagor) or permitting a short refinancing (a payoff
of the Mortgage Loan for an amount less than the total amount contractually owed
in order to facilitate refinancing transactions by the Mortgagor not involving a
sale of the Mortgaged  Property),  (ii)  arranging for a repayment plan or (iii)
agreeing to a modification  in accordance  with Section 3.07. In connection with
such foreclosure or other conversion, the Master Servicer shall, consistent with
Section 3.11, follow such practices and procedures as it shall deem necessary or
advisable,  as shall be  normal  and  usual in its  general  mortgage  servicing
activities and as shall be required or permitted by the Program Guide;  provided
that the Master  Servicer  shall not be liable in any respect  hereunder  if the
Master  Servicer  is acting in  connection  with any such  foreclosure  or other
conversion in a manner that is consistent with the provisions of this Agreement.
The Master Servicer,  however,  shall not be required to expend its own funds or
incur other reimbursable charges in connection with any

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<PAGE>

foreclosure,  or attempted  foreclosure  which is not completed,  or towards the
restoration of any property unless it shall determine (i) that such  restoration
and/or  foreclosure  will increase the proceeds of  liquidation  of the Mortgage
Loan to Holders of  Certificates of one or more Classes after  reimbursement  to
itself for such  expenses or charges and (ii) that such expenses or charges will
be recoverable to it through Liquidation  Proceeds,  Insurance Proceeds,  or REO
Proceeds  (respecting  which it shall have priority for purposes of  withdrawals
from the  Custodial  Account  pursuant  to  Section  3.10,  whether  or not such
expenses and charges are actually recoverable from related Liquidation Proceeds,
Insurance Proceeds or REO Proceeds). In the event of such a determination by the
Master Servicer  pursuant to this Section 3.14(a),  the Master Servicer shall be
entitled to reimbursement of such amounts pursuant to Section 3.10.

            In addition to the foregoing, the Master Servicer shall use its best
reasonable  efforts to realize upon any  Additional  Collateral  for such of the
Additional Collateral Loans as come into and continue in default and as to which
no satisfactory  arrangements can be made for collection of delinquent  payments
pursuant to Section 3.07; provided that the Master Servicer shall not, on behalf
of the Trustee, obtain title to any such Additional Collateral as a result of or
in lieu of the disposition  thereof or otherwise;  and provided further that (i)
the Master Servicer shall not proceed with respect to such Additional Collateral
in any manner  that would  impair the  ability to recover  against  the  related
Mortgaged  Property,  and (ii) the Master  Servicer  shall  proceed with any REO
Acquisition in a manner that preserves the ability to apply the proceeds of such
Additional  Collateral  against amounts owed under the defaulted  Mortgage Loan.
Any proceeds realized from such Additional  Collateral (other than amounts to be
released to the Mortgagor or the related guarantor in accordance with procedures
that the  Master  Servicer  would  follow in  servicing  loans  held for its own
account,  subject  to the terms  and  conditions  of the  related  Mortgage  and
Mortgage  Note  and to the  terms  and  conditions  of any  security  agreement,
guarantee  agreement,  mortgage or other agreement  governing the disposition of
the proceeds of such Additional  Collateral) shall be deposited in the Custodial
Account,  subject to  withdrawal  pursuant to Section  3.10.  Any other  payment
received by the Master Servicer in respect of such Additional  Collateral  shall
be deposited in the Custodial Account subject to withdrawal  pursuant to Section
3.10.

            For so long as the Master  Servicer is the Master Servicer under the
Credit  Support  Pledge  Agreement,   the  Master  Servicer  shall  perform  its
obligations  under the Credit Support Pledge  Agreement in accordance  with such
Agreement   and  in  a   manner   that  is  in  the   best   interests   of  the
Certificateholders.  Further,  the Master Servicer shall use its best reasonable
efforts to realize upon any Pledged  Assets for such of the Pledged  Asset Loans
as  come  into  and  continue  in  default  and  as  to  which  no  satisfactory
arrangements  can be made for  collection  of  delinquent  payments  pursuant to
Section  3.07;  provided  that the Master  Servicer  shall not, on behalf of the
Trustee,  obtain title to any such  Pledged  Assets as a result of or in lieu of
the disposition  thereof or otherwise;  and provided further that (i) the Master
Servicer  shall not proceed with  respect to such  Pledged  Assets in any manner
that would impair the ability to recover against the related Mortgaged Property,
and (ii) the Master  Servicer shall proceed with any REO Acquisition in a manner
that  preserves the ability to apply the proceeds of such Pledged Assets against
amounts owed under the defaulted  Mortgage Loan. Any proceeds realized from such
Pledged  Assets  (other  than  amounts to be released  to the  Mortgagor  or the
related  guarantor in accordance  with procedures that the Master Servicer would
follow in

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<PAGE>

servicing loans held for its own account, subject to the terms and conditions of
the related  Mortgage and Mortgage  Note and to the terms and  conditions of any
security agreement,  guarantee agreement,  mortgage or other agreement governing
the  disposition  of the proceeds of such Pledged  Assets) shall be deposited in
the Custodial Account, subject to withdrawal pursuant to Section 3.10. Any other
payment  received by the Master Servicer in respect of such Pledged Assets shall
be deposited in the Custodial Account subject to withdrawal  pursuant to Section
3.10.

            Concurrently with the foregoing,  the Master Servicer may pursue any
remedies that may be available in connection  with a breach of a  representation
and warranty with respect to any such Mortgage Loan in accordance  with Sections
2.03 and 2.04.  However,  the Master  Servicer  is not  required  to continue to
pursue both foreclosure (or similar remedies) with respect to the Mortgage Loans
and remedies in connection with a breach of a representation and warranty if the
Master Servicer determines in its reasonable  discretion that one such remedy is
more likely to result in a greater  recovery as to the Mortgage  Loan.  Upon the
occurrence of a Cash  Liquidation or REO  Disposition,  following the deposit in
the Custodial Account of all Insurance Proceeds,  Liquidation Proceeds and other
payments and recoveries  referred to in the definition of "Cash  Liquidation" or
"REO  Disposition,"  as  applicable,  upon  receipt  by the  Trustee  of written
notification of such deposit signed by a Servicing  Officer,  the Trustee or the
Custodian,  as the case may be, shall release to the Master Servicer the related
Custodial  File and the Trustee  shall execute and deliver such  instruments  of
transfer or  assignment  prepared by the Master  Servicer,  in each case without
recourse,  as shall be necessary to vest in the Master Servicer or its designee,
as the case may be, the related Mortgage Loan, and thereafter such Mortgage Loan
shall not be part of the Trust Fund.  Notwithstanding the foregoing or any other
provision of this  Agreement,  in the Master  Servicer's  sole  discretion  with
respect  to any  defaulted  Mortgage  Loan or REO  Property  as to either of the
following provisions, (i) a Cash Liquidation or REO Disposition may be deemed to
have occurred if substantially all amounts expected by the Master Servicer to be
received in connection with the related defaulted  Mortgage Loan or REO Property
have been  received,  and (ii) for  purposes  of  determining  the amount of any
Liquidation Proceeds,  Insurance Proceeds, REO Proceeds or any other unscheduled
collections  or the amount of any Realized  Loss,  the Master  Servicer may take
into account minimal amounts of additional  receipts  expected to be received or
any  estimated  additional  liquidation  expenses  expected  to be  incurred  in
connection with the related defaulted Mortgage Loan or REO Property.

      (b) If title to any Mortgaged Property is acquired by the Trust Fund as an
REO  Property  by  foreclosure  or by deed in lieu of  foreclosure,  the deed or
certificate  of sale shall be issued to the  Trustee or to its nominee on behalf
of  Certificateholders.  Notwithstanding  any  such  acquisition  of  title  and
cancellation  of the related  Mortgage Loan,  such REO Property shall (except as
otherwise expressly provided herein) be considered to be an Outstanding Mortgage
Loan held in the Trust Fund until such time as the REO  Property  shall be sold.
Consistent with the foregoing for purposes of all calculations hereunder so long
as such REO Property shall be considered to be an  Outstanding  Mortgage Loan it
shall be assumed that,  notwithstanding  that the indebtedness  evidenced by the
related  Mortgage  Note shall have been  discharged,  such Mortgage Note and the
related  amortization  schedule in effect at the time of any such acquisition of
title  (after  giving  effect  to  any  previous  Curtailments  and  before  any
adjustment thereto by

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reason of any  bankruptcy  or similar  proceeding  or any  moratorium or similar
waiver or grace period) remain in effect.

      (c) If the Trust Fund  acquires any REO Property as aforesaid or otherwise
in connection with a default or imminent  default on a Mortgage Loan, the Master
Servicer on behalf of the Trust Fund shall  dispose of such REO Property as soon
as   practicable,   giving   due   consideration   to  the   interests   of  the
Certificateholders,  but in all cases  within three full years after the taxable
year of its acquisition by the Trust Fund for purposes of Section  860G(a)(8) of
the Code (or such shorter  period as may be  necessary  under  applicable  state
(including  any state in which such  property  is located)  law to maintain  the
status of any portion of any REMIC formed under the Series Supplement as a REMIC
under  applicable state law and avoid taxes resulting from such property failing
to be foreclosure property under applicable state law) or, at the expense of the
Trust Fund, request, more than 60 days before the day on which such grace period
would  otherwise  expire,  an extension  of such grace period  unless the Master
Servicer  (subject  to Section  10.01(f))  obtains for the Trustee an Opinion of
Counsel,  addressed to the Trustee and the Master  Servicer,  to the effect that
the  holding by the Trust Fund of such REO  Property  subsequent  to such period
will not  result in the  imposition  of taxes on  "prohibited  transactions"  as
defined in Section  860F of the Code or cause any REMIC  formed under the Series
Supplement to fail to qualify as a REMIC (for federal (or any  applicable  State
or  local)  income  tax  purposes)  at  any  time  that  any   Certificates  are
outstanding, in which case the Trust Fund may continue to hold such REO Property
(subject to any  conditions  contained in such  Opinion of Counsel).  The Master
Servicer shall be entitled to be reimbursed  from the Custodial  Account for any
costs  incurred in  obtaining  such  Opinion of Counsel,  as provided in Section
3.10.  Notwithstanding  any other provision of this  Agreement,  no REO Property
acquired by the Trust Fund shall be rented (or allowed to continue to be rented)
or otherwise used by or on behalf of the Trust Fund in such a manner or pursuant
to any terms  that  would (i) cause  such REO  Property  to fail to  qualify  as
"foreclosure  property" within the meaning of Section  860G(a)(8) of the Code or
(ii) subject the Trust Fund to the imposition of any federal income taxes on the
income earned from such REO  Property,  including any taxes imposed by reason of
Section 860G(c) of the Code,  unless the Master Servicer has agreed to indemnify
and hold  harmless  the Trust Fund with  respect to the  imposition  of any such
taxes.

      (d) The proceeds of any Cash  Liquidation,  REO Disposition or purchase or
repurchase of any Mortgage Loan pursuant to the terms of this Agreement, as well
as any recovery resulting from a collection of Liquidation  Proceeds,  Insurance
Proceeds or REO Proceeds,  will be applied in the  following  order of priority:
first, to reimburse the Master Servicer or the related Subservicer in accordance
with Section  3.10(a)(ii);  second, to the  Certificateholders  to the extent of
accrued and unpaid  interest on the Mortgage  Loan,  and any related REO Imputed
Interest,  at the Net Mortgage  Rate (or the  Modified Net Mortgage  Rate in the
case of a Modified Mortgage Loan) to the Due Date prior to the Distribution Date
on which such amounts are to be distributed; third, to the Certificateholders as
a recovery of principal on the Mortgage Loan (or REO Property);  fourth,  to all
Servicing Fees and Subservicing  Fees payable therefrom (and the Master Servicer
and the Subservicer  shall have no claims for any  deficiencies  with respect to
such fees which result from the foregoing allocation); and fifth, to Foreclosure
Profits.

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(e) In the event of a default on a Mortgage  Loan one or more of whose  obligors
is not a United States Person, in connection with any foreclosure or acquisition
of a deed in lieu of foreclosure  (together,  "foreclosure")  in respect of such
Mortgage Loan, the Master Servicer will cause  compliance with the provisions of
Treasury Regulation Section  1.1445-2(d)(3) (or any successor thereto) necessary
to assure that no withholding tax obligation arises with respect to the proceeds
of such  foreclosure  except  to the  extent,  if  any,  that  proceeds  of such
foreclosure are required to be remitted to the obligors on such Mortgage Loan.

      Section 3.15. Trustee to Cooperate; Release of Custodial Files.

      (a) Upon  becoming  aware of the payment in full of any Mortgage  Loan, or
upon the receipt by the Master  Servicer of a notification  that payment in full
will be escrowed in a manner  customary for such purposes,  the Master  Servicer
will immediately  notify the Trustee (if it holds the related Custodial File) or
the Custodian by a  certification  of a Servicing  Officer (which  certification
shall  include a  statement  to the effect  that all  amounts  received or to be
received in  connection  with such payment which are required to be deposited in
the  Custodial  Account  pursuant  to  Section  3.07  have  been  or  will be so
deposited),  substantially in one of the forms attached hereto as Exhibit F, or,
in the case of the Custodian,  an electronic request in a form acceptable to the
Custodian,  requesting delivery to it of the Custodial File. Within two Business
Days of receipt of such certification and request, the Trustee shall release, or
cause the  Custodian  to  release,  the  related  Custodial  File to the  Master
Servicer.  The Master  Servicer  is  authorized  to execute  and  deliver to the
Mortgagor  the  request for  reconveyance,  deed of  reconveyance  or release or
satisfaction of mortgage or such instrument  releasing the lien of the Mortgage,
together  with the  Mortgage  Note with,  as  appropriate,  written  evidence of
cancellation  thereon  and to cause the  removal  from the  registration  on the
MERS(R)  System of such  Mortgage and to execute and  deliver,  on behalf of the
Trustee and the  Certificateholders  or any of them, any and all  instruments of
satisfaction or cancellation or of partial or full release. No expenses incurred
in connection with any instrument of satisfaction or deed of reconveyance  shall
be chargeable to the Custodial Account or the Certificate Account.

      (b) From time to time as is  appropriate  for the servicing or foreclosure
of any Mortgage Loan, the Master Servicer shall deliver to the Custodian, with a
copy to the Trustee,  a certificate of a Servicing Officer  substantially in one
of the forms attached as Exhibit F hereto, or, in the case of the Custodian,  an
electronic  request  in a form  acceptable  to the  Custodian,  requesting  that
possession of all, or any document  constituting  part of, the Custodial File be
released to the Master Servicer and certifying as to the reason for such release
and that such release will not  invalidate  any insurance  coverage  provided in
respect of the Mortgage Loan under any Required  Insurance Policy.  Upon receipt
of the foregoing,  the Trustee shall deliver, or cause the Custodian to deliver,
the Custodial File or any document  therein to the Master  Servicer.  The Master
Servicer shall cause each Custodial File or any document  therein so released to
be returned to the Trustee,  or the  Custodian as agent for the Trustee when the
need therefor by the Master  Servicer no longer exists,  unless (i) the Mortgage
Loan has been liquidated and the Liquidation  Proceeds  relating to the Mortgage
Loan have been deposited in the Custodial  Account or (ii) the Custodial File or
such  document  has been  delivered  directly  or  through a  Subservicer  to an
attorney,  or to a public  trustee or other public  official as required by law,
for purposes of initiating or pursuing legal action or other proceedings for the
foreclosure of the Mortgaged Property either judicially or  non-judicially,  and
the Master Servicer has delivered

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<PAGE>

directly or through a Subservicer  to the Trustee a  certificate  of a Servicing
Officer  certifying  as to the name and  address  of the  Person  to which  such
Custodial  File or such  document was  delivered  and the purpose or purposes of
such delivery.  In the event of the  liquidation of a Mortgage Loan, the Trustee
shall  deliver  the  Request  for  Release  with  respect  thereto to the Master
Servicer  upon  deposit of the related  Liquidation  Proceeds  in the  Custodial
Account.

      (c) The  Trustee or the Master  Servicer  on the  Trustee's  behalf  shall
execute and deliver to the Master Servicer,  if necessary,  any court pleadings,
requests for trustee's sale or other  documents  necessary to the foreclosure or
trustee's sale in respect of a Mortgaged Property or to any legal action brought
to obtain judgment  against any Mortgagor on the Mortgage Note or Mortgage or to
obtain a  deficiency  judgment,  or to  enforce  any  other  remedies  or rights
provided by the Mortgage  Note or Mortgage or  otherwise  available at law or in
equity.  Together  with such  documents or pleadings (if signed by the Trustee),
the Master  Servicer  shall deliver to the Trustee a certificate  of a Servicing
Officer  requesting  that such pleadings or documents be executed by the Trustee
and  certifying  as to the reason such  documents or pleadings  are required and
that the execution and delivery  thereof by the Trustee will not  invalidate any
insurance  coverage  under  any  Required  Insurance  Policy  or  invalidate  or
otherwise affect the lien of the Mortgage,  except for the termination of such a
lien upon completion of the foreclosure or trustee's sale.

      Section 3.16. Servicing and Other Compensation; Compensating Interest.

      (a) The Master  Servicer,  as compensation  for its activities  hereunder,
shall be entitled to receive on each  Distribution Date the amounts provided for
by clauses (iii),  (iv), (v) and (vi) of Section 3.10(a),  subject to clause (e)
below. The amount of servicing  compensation  provided for in such clauses shall
be accounted for on a Mortgage  Loan-by-Mortgage  Loan basis.  In the event that
Liquidation  Proceeds,  Insurance  Proceeds  and REO  Proceeds  (net of  amounts
reimbursable  therefrom  pursuant to Section  3.10(a)(ii))  in respect of a Cash
Liquidation  or REO  Disposition  exceed  the unpaid  principal  balance of such
Mortgage  Loan plus  unpaid  interest  accrued  thereon  (including  REO Imputed
Interest)  at a per annum rate equal to the  related Net  Mortgage  Rate (or the
Modified Net Mortgage Rate in the case of a Modified  Mortgage Loan), the Master
Servicer  shall be entitled to retain  therefrom and to pay to itself and/or the
related   Subservicer,   any  Foreclosure  Profits  and  any  Servicing  Fee  or
Subservicing Fee considered to be accrued but unpaid.

      (b) Additional  servicing  compensation in the form of prepayment charges,
assumption  fees,  late  payment  charges,  investment  income on amounts in the
Custodial  Account or the Certificate  Account or otherwise shall be retained by
the Master Servicer or the Subservicer to the extent provided herein, subject to
clause (e) below.

      (c) The Master Servicer shall be required to pay, or cause to be paid, all
expenses  incurred by it in connection with its servicing  activities  hereunder
(including  payment of premiums for the Primary Insurance  Policies,  if any, to
the extent such premiums are not required to be paid by the related  Mortgagors,
and the fees and  expenses  of the Trustee and any  co-trustee  (as  provided in
Section  8.05)  and the fees and  expense  of the  Custodian)  and  shall not be
entitled to reimbursement  therefor except as specifically  provided in Sections
3.10 and 3.14.

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      (d) The Master Servicer's right to receive servicing  compensation may not
be transferred in whole or in part except in connection with the transfer of all
of its  responsibilities  and  obligations  of the  Master  Servicer  under this
Agreement.

      (e)  Notwithstanding  any other provision herein,  the amount of servicing
compensation  that the Master  Servicer  shall be  entitled  to receive  for its
activities  hereunder for the period ending on each  Distribution  Date shall be
reduced  (but not below zero) by an amount  equal to  Compensating  Interest (if
any) for such  Distribution  Date.  Such reduction  shall be applied during such
period as follows:  first, to any Servicing Fee or Subservicing Fee to which the
Master Servicer is entitled pursuant to Section 3.10(a)(iii), and second, to any
income or gain  realized  from any  investment  of funds  held in the  Custodial
Account or the  Certificate  Account to which the Master  Servicer  is  entitled
pursuant to Sections 3.07(c) or 4.01(b), respectively. In making such reduction,
the Master  Servicer (i) will not withdraw from the  Custodial  Account any such
amount  representing  all or a  portion  of the  Servicing  Fee to  which  it is
entitled pursuant to Section  3.10(a)(iii),  and (ii) will not withdraw from the
Custodial Account or Certificate Account any such amount to which it is entitled
pursuant to Section 3.07(c) or 4.01(b).

      Section 3.17. Reports to the Trustee and the Company.

      Not later than fifteen  days after it receives a written  request from the
Trustee or the Company, the Master Servicer shall forward to the Trustee and the
Company a statement,  certified by a Servicing Officer, setting forth the status
of the  Custodial  Account  as of  the  close  of  business  on the  immediately
preceding Distribution Date as it relates to the Mortgage Loans and showing, for
the  period  covered  by  such  statement,  the  aggregate  of  deposits  in  or
withdrawals from the Custodial Account in respect of the Mortgage Loans for each
category of deposit  specified in Section 3.07 and each  category of  withdrawal
specified in Section 3.10.

      Section 3.18. Annual Statement as to Compliance and Servicing Assessment.

      The Master  Servicer  will  deliver to the  Company  and the Trustee on or
before  the  earlier  of (a)  March 31 of each year or (b) with  respect  to any
calendar year during which the Company's  annual report on Form 10-K is required
to be filed in accordance with the Exchange Act and the rules and regulations of
the Commission,  the date on which the annual report on Form 10-K is required to
be filed in accordance  with the Exchange Act and the rules and  regulations  of
the Commission,  (i) a servicing  assessment as described in Section 4.03(f)(ii)
and (ii) a servicer compliance statement, signed by an authorized officer of the
Master Servicer,  as described in Items 1122(a),  1122(b) and 1123 of Regulation
AB, to the effect that:

      (A) A review of the Master  Servicer's  activities  during  the  reporting
period  and of its  performance  under this  Agreement  has been made under such
officer's supervision.

      (B) To the best of such  officer's  knowledge,  based on such review,  the
Master Servicer has fulfilled all of its obligations under this Agreement in all
material  respects  throughout  the  reporting  period  or,  if there has been a
failure to fulfill any such obligation in any material respect,  specifying each
such failure known to such officer and the nature and status thereof.

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<PAGE>

      The Master Servicer shall use  commercially  reasonable  efforts to obtain
from all other parties  participating  in the servicing  function any additional
certifications  required  under Item 1122 and Item 1123 of  Regulation AB to the
extent required to be included in a Report on Form 10-K; provided, however, that
a failure  to obtain  such  certifications  shall not be a breach of the  Master
Servicer's  duties  hereunder  if  any  such  party  fails  to  deliver  such  a
certification.

      Section 3.19. Annual Independent Public Accountants' Servicing Report.

      On or before the earlier of (a) March 31 of each year or (b) with  respect
to any calendar  year during which the  Company's  annual report on Form 10-K is
required  to be filed in  accordance  with the  Exchange  Act and the  rules and
regulations of the Commission,  the date on which the annual report on Form 10-K
is required to be filed in  accordance  with the  Exchange Act and the rules and
regulations of the Commission,  the Master Servicer at its expense shall cause a
firm of independent public  accountants,  which shall be members of the American
Institute of  Certified  Public  Accountants,  to furnish to the Company and the
Trustee  the  attestation  required  under  Item  1122(b) of  Regulation  AB. In
rendering  such  statement,  such firm may rely,  as to matters  relating to the
direct servicing of mortgage loans by Subservicers,  upon comparable  statements
for examinations  conducted by independent public  accountants  substantially in
accordance  with standards  established  by the American  Institute of Certified
Public Accountants  (rendered within one year of such statement) with respect to
such Subservicers.

      Section 3.20. Rights of the Company in Respect of the Master Servicer.

      The Master  Servicer  shall afford the Company,  upon  reasonable  notice,
during  normal  business  hours access to all records  maintained  by the Master
Servicer  in  respect  of its rights  and  obligations  hereunder  and access to
officers of the Master Servicer responsible for such obligations.  Upon request,
the Master  Servicer  shall  furnish the Company with its most recent  financial
statements and such other information as the Master Servicer possesses regarding
its business,  affairs,  property and  condition,  financial or  otherwise.  The
Master   Servicer  shall  also  cooperate  with  all  reasonable   requests  for
information  including,  but not limited to, notices, tapes and copies of files,
regarding  itself,  the Mortgage  Loans or the  Certificates  from any Person or
Persons identified by the Company or Residential  Funding.  The Company may, but
is not obligated to, enforce the  obligations of the Master  Servicer  hereunder
and may, but is not obligated to, perform,  or cause a designee to perform,  any
defaulted  obligation of the Master Servicer hereunder or exercise the rights of
the Master  Servicer  hereunder;  provided that the Master Servicer shall not be
relieved of any of its  obligations  hereunder by virtue of such  performance by
the Company or its designee.  The Company shall not have any  responsibility  or
liability  for any action or failure  to act by the Master  Servicer  and is not
obligated  to  supervise  the  performance  of the  Master  Servicer  under this
Agreement or otherwise.

      Section 3.21. Administration of Buydown Funds

      (a) With  respect  to any  Buydown  Mortgage  Loan,  the  Subservicer  has
deposited  Buydown  Funds in an account that  satisfies the  requirements  for a
Subservicing  Account (the "Buydown  Account").  The Master Servicer shall cause
the  Subservicing  Agreement to require that upon receipt from the  Mortgagor of
the amount due on a Due Date for each Buydown

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Mortgage  Loan,  the  Subservicer  will  withdraw  from the Buydown  Account the
predetermined  amount  that,  when added to the amount due on such date from the
Mortgagor,  equals  the  full  Monthly  Payment  and  transmit  that  amount  in
accordance with the terms of the  Subservicing  Agreement to the Master Servicer
together  with the  related  payment  made by the  Mortgagor  or advanced by the
Subservicer.

      (b) If the  Mortgagor on a Buydown  Mortgage Loan prepays such loan in its
entirety  during  the period  (the  "Buydown  Period")  when  Buydown  Funds are
required to be applied to such Buydown  Mortgage Loan, the Subservicer  shall be
required to  withdraw  from the  Buydown  Account  and remit any  Buydown  Funds
remaining  in the  Buydown  Account  in  accordance  with  the  related  buydown
agreement.  The amount of Buydown Funds which may be remitted in accordance with
the related  buydown  agreement may reduce the amount required to be paid by the
Mortgagor  to fully  prepay the related  Mortgage  Loan.  If the  Mortgagor on a
Buydown  Mortgage Loan defaults on such Mortgage Loan during the Buydown  Period
and the property  securing such Buydown Mortgage Loan is sold in the liquidation
thereof  (either by the Master Servicer or the insurer under any related Primary
Insurance  Policy),  the  Subservicer  shall be required  to  withdraw  from the
Buydown  Account the Buydown Funds for such Buydown  Mortgage Loan still held in
the Buydown Account and remit the same to the Master Servicer in accordance with
the terms of the Subservicing Agreement for deposit in the Custodial Account or,
if  instructed  by the Master  Servicer,  pay to the  insurer  under any related
Primary  Insurance  Policy if the  Mortgaged  Property  is  transferred  to such
insurer  and such  insurer  pays all of the loss  incurred  in  respect  of such
default.  Any amount so remitted  pursuant  to the  preceding  sentence  will be
deemed to reduce the amount owed on the Mortgage Loan.

      Section 3.22. Advance Facility

      (a) The Master Servicer is hereby  authorized to enter into a financing or
other facility (any such arrangement, an "Advance Facility") under which (1) the
Master  Servicer  sells,  assigns or pledges  to another  Person (an  "Advancing
Person") the Master  Servicer's rights under this Agreement to be reimbursed for
any Advances or Servicing Advances and/or (2) an Advancing Person agrees to fund
some or all Advances and/or Servicing Advances required to be made by the Master
Servicer pursuant to this Agreement.  No consent of the Depositor,  the Trustee,
the  Certificateholders  or any other party shall be required  before the Master
Servicer may enter into an Advance  Facility.  Notwithstanding  the existence of
any Advance  Facility  under which an Advancing  Person  agrees to fund Advances
and/or Servicing  Advances on the Master Servicer's  behalf, the Master Servicer
shall remain obligated pursuant to this Agreement to make Advances and Servicing
Advances  pursuant to and as required by this Agreement.  If the Master Servicer
enters into an Advance Facility,  and for so long as an Advancing Person remains
entitled to receive  reimbursement  for any  Advances  including  Nonrecoverable
Advances ("Advance  Reimbursement  Amounts") and/or Servicing Advances including
Nonrecoverable  Advances ("Servicing Advance Reimbursement Amounts" and together
with Advance Reimbursement  Amounts,  "Reimbursement  Amounts") (in each case to
the  extent  such  type of  Reimbursement  Amount  is  included  in the  Advance
Facility), as applicable,  pursuant to this Agreement,  then the Master Servicer
shall identify such  Reimbursement  Amounts  consistent  with the  reimbursement
rights set forth in Section  3.10(a)(ii) and (vii) and remit such  Reimbursement
Amounts in accordance with this Section 3.22 or otherwise in accordance with the
documentation establishing the Advance Facility to such Advancing Person or to a
trustee,

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<PAGE>

agent or custodian (an "Advance Facility Trustee")  designated by such Advancing
Person  in an  Advance  Facility  Notice  described  below in  Section  3.22(b).
Notwithstanding  the  foregoing,  if so  required  pursuant  to the terms of the
Advance Facility,  the Master Servicer may direct, and if so directed in writing
the  Trustee  is hereby  authorized  to and shall  pay to the  Advance  Facility
Trustee the Reimbursement Amounts identified pursuant to the preceding sentence.
An Advancing  Person whose  obligations  hereunder are limited to the funding of
Advances  and/or   Servicing   Advances  shall  not  be  required  to  meet  the
qualifications of a Master Servicer or a Subservicer pursuant to Section 3.02(a)
or  6.02(c)  hereof  and  shall not be deemed  to be a  Subservicer  under  this
Agreement.  Notwithstanding  anything to the contrary herein,  in no event shall
Advance  Reimbursement  Amounts or Servicing  Advance  Reimbursement  Amounts be
included   in   the   Available    Distribution   Amount   or   distributed   to
Certificateholders.

      (b) If the Master Servicer  enters into an Advance  Facility and makes the
election  set forth in Section  3.22(a),  the Master  Servicer  and the  related
Advancing  Person  shall  deliver to the  Certificate  Insurer and the Trustee a
written notice and payment instruction (an "Advance Facility Notice"), providing
the Trustee  with  written  payment  instructions  as to where to remit  Advance
Reimbursement  Amounts and/or Servicing Advance  Reimbursement  Amounts (each to
the extent  such type of  Reimbursement  Amount is  included  within the Advance
Facility)  on  subsequent  Distribution  Dates.  The payment  instruction  shall
require the applicable  Reimbursement Amounts to be distributed to the Advancing
Person or to an Advance  Facility  Trustee  designated  in the Advance  Facility
Notice.  An Advance  Facility Notice may only be terminated by the joint written
direction  of the Master  Servicer  and the  related  Advancing  Person (and any
related  Advance  Facility  Trustee).  The Master  Servicer  shall  provide  the
Certificate  Insurer,  if any,  with  notice of any  termination  of any Advance
Facility pursuant to this Section 3.22(b).

      (c)  Reimbursement  Amounts shall consist  solely of amounts in respect of
Advances and/or  Servicing  Advances made with respect to the Mortgage Loans for
which the Master  Servicer would be permitted to reimburse  itself in accordance
with Section  3.10(a)(ii) and (vii) hereof,  assuming the Master Servicer or the
Advancing Person had made the related  Advance(s)  and/or Servicing  Advance(s).
Notwithstanding   the  foregoing,   except  with  respect  to  reimbursement  of
Nonrecoverable  Advances as set forth in Section 3.10(c) of this  Agreement,  no
Person  shall be entitled  to  reimbursement  from funds held in the  Collection
Account  for  future  distribution  to   Certificateholders   pursuant  to  this
Agreement.  Neither the Company nor the Trustee shall have any duty or liability
with  respect to the  calculation  of any  Reimbursement  Amount,  nor shall the
Company  or the  Trustee  have  any  responsibility  to  track  or  monitor  the
administration  of the  Advance  Facility or have any  responsibility  to track,
monitor or verify the payment of Reimbursement  Amounts to the related Advancing
Person or Advance  Facility  Trustee.  The Master  Servicer  shall  maintain and
provide to any Successor Master Servicer a detailed accounting on a loan-by-loan
basis as to amounts advanced by, sold, pledged or assigned to, and reimbursed to
any Advancing Person. The Successor Master Servicer shall be entitled to rely on
any such  information  provided by the Master Servicer and the Successor  Master
Servicer shall not be liable for any errors in such information.

      (d) Upon the direction of and at the expense of the Master  Servicer,  the
Trustee agrees to execute such acknowledgments, certificates and other documents
reasonably   satisfactory  to  the  Trustee  provided  by  the  Master  Servicer
recognizing the interests of any

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Advancing Person or Advance Facility  Trustee in such  Reimbursement  Amounts as
the Master Servicer may cause to be made subject to Advance Facilities  pursuant
to this Section 3.22.

      (e)  Reimbursement  Amounts  collected  with respect to each Mortgage Loan
shall be allocated to outstanding  unreimbursed  Advances or Servicing  Advances
(as the case may be) made with  respect to that  Mortgage  Loan on a  "first-in,
first out" ("FIFO") basis, subject to the qualifications set forth below:

            (i)  Any  successor  Master  Servicer  to  Residential   Funding  (a
      "Successor  Master Servicer") and the Advancing Person or Advance Facility
      Trustee  shall be required to apply all amounts  available  in  accordance
      with this Section 3.22(e) to the  reimbursement  of Advances and Servicing
      Advances in the manner provided for herein; provided,  however, that after
      the succession of a Successor Master Servicer,  (A) to the extent that any
      Advances or Servicing  Advances  with respect to any  particular  Mortgage
      Loan are reimbursed from payments or recoveries,  if any, from the related
      Mortgagor,  and Liquidation  Proceeds or Insurance Proceeds,  if any, with
      respect to that Mortgage Loan,  reimbursement shall be made, first, to the
      Advancing Person or Advance Facility Trustee in respect of Advances and/or
      Servicing  Advances  related  to that  Mortgage  Loan to the extent of the
      interest  of the  Advancing  Person or  Advance  Facility  Trustee in such
      Advances  and/or  Servicing  Advances,  second to the Master  Servicer  in
      respect of Advances  and/or  Servicing  Advances  related to that Mortgage
      Loan in excess of those in which the Advancing  Person or Advance Facility
      Trustee  Person  has an  interest,  and  third,  to the  Successor  Master
      Servicer  in  respect  of any other  Advances  and/or  Servicing  Advances
      related to that Mortgage  Loan,  from such sources as and when  collected,
      and (B)  reimbursements  of  Advances  and  Servicing  Advances  that  are
      Nonrecoverable  Advances shall be made pro rata to the Advancing Person or
      Advance Facility  Trustee,  on the one hand, and any such Successor Master
      Servicer,  on the other  hand,  on the basis of the  respective  aggregate
      outstanding   unreimbursed   Advances  and  Servicing  Advances  that  are
      Nonrecoverable  Advances owed to the Advancing  Person,  Advance  Facility
      Trustee or Master Servicer  pursuant to this  Agreement,  on the one hand,
      and any such  Successor  Master  Servicer,  on the other hand, and without
      regard to the date on which any such Advances or Servicing  Advances shall
      have been made. In the event that, as a result of the FIFO allocation made
      pursuant to this Section  3.22(e),  some or all of a Reimbursement  Amount
      paid to the  Advancing  Person or  Advance  Facility  Trustee  relates  to
      Advances  or  Servicing  Advances  that were made by a Person  other  than
      Residential  Funding or the Advancing Person or Advance Facility  Trustee,
      then the Advancing Person or Advance Facility Trustee shall be required to
      remit any portion of such  Reimbursement  Amount to the Person entitled to
      such portion of such Reimbursement Amount. Without limiting the generality
      of  the  foregoing,  Residential  Funding  shall  remain  entitled  to  be
      reimbursed by the  Advancing  Person or Advance  Facility  Trustee for all
      Advances  and  Servicing  Advances  funded by  Residential  Funding to the
      extent the  related  Reimbursement  Amount(s)  have not been  assigned  or
      pledged  to  an  Advancing  Person  or  Advance  Facility   Trustee.   The
      documentation  establishing any Advance Facility shall require Residential
      Funding to provide to the  related  Advancing  Person or Advance  Facility
      Trustee loan by loan information with respect to each Reimbursement Amount
      distributed to such Advancing  Person or Advance  Facility Trustee on each
      date of remittance  thereof to such Advancing  Person or Advance  Facility
      Trustee, to enable the Advancing Person or Advance Facility

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      Trustee to make the FIFO  allocation  of each  Reimbursement  Amount  with
      respect to each Mortgage Loan.

            (ii)  By way of  illustration,  and  not  by  way  of  limiting  the
      generality  of  the  foregoing,  if  the  Master  Servicer  resigns  or is
      terminated  at a time when the  Master  Servicer  is a party to an Advance
      Facility,  and  is  replaced  by a  Successor  Master  Servicer,  and  the
      Successor  Master Servicer  directly funds Advances or Servicing  Advances
      with respect to a Mortgage  Loan and does not assign or pledge the related
      Reimbursement  Amounts to the related Advancing Person or Advance Facility
      Trustee,  then all  payments  and  recoveries  received  from the  related
      Mortgagor or received in the form of Liquidation  Proceeds with respect to
      such Mortgage Loan (including  Insurance  Proceeds collected in connection
      with a liquidation of such Mortgage  Loan) will be allocated  first to the
      Advancing   Person  or  Advance   Facility   Trustee   until  the  related
      Reimbursement  Amounts attributable to such Mortgage Loan that are owed to
      the Master Servicer and the Advancing Person, which were made prior to any
      Advances or Servicing Advances made by the Successor Master Servicer, have
      been  reimbursed  in full, at which point the  Successor  Master  Servicer
      shall be entitled to retain all related Reimbursement Amounts subsequently
      collected  with respect to that  Mortgage Loan pursuant to Section 3.10 of
      this Agreement.  To the extent that the Advances or Servicing Advances are
      Nonrecoverable Advances to be reimbursed on an aggregate basis pursuant to
      Section 3.10 of this Agreement, the reimbursement paid in this manner will
      be made pro rata to the Advancing Person or Advance Facility  Trustee,  on
      the one hand,  and the Successor  Master  Servicer,  on the other hand, as
      described in clause (i)(B) above.

      (f) The Master  Servicer  shall remain  entitled to be reimbursed  for all
Advances and Servicing  Advances funded by the Master Servicer to the extent the
related rights to be reimbursed therefor have not been sold, assigned or pledged
to an Advancing Person.

      (g) Any  amendment to this Section 3.22 or to any other  provision of this
Agreement that may be necessary or appropriate to effect the terms of an Advance
Facility as described  generally in this Section 3.22,  including  amendments to
add provisions  relating to a successor Master Servicer,  may be entered into by
the Trustee,  the Certificate  Insurer,  Company and the Master Servicer without
the consent of any Certificateholder, with written confirmation from each Rating
Agency that the amendment will not result in the reduction of the ratings on any
class of the  Certificates  below the  lesser of the then  current  or  original
ratings on such  Certificates,  and an opinion of counsel as required by Section
11.01(c),  notwithstanding  anything  to the  contrary  in  Section  11.01 of or
elsewhere in this Agreement.

      (h) Any rights of set-off that the Trust Fund,  the Trustee,  the Company,
any Successor  Master  Servicer or any other Person might otherwise have against
the Master  Servicer under this  Agreement  shall not attach to any rights to be
reimbursed for Advances or Servicing Advances that have been sold,  transferred,
pledged, conveyed or assigned to any Advancing Person.

      (i) At any  time  when an  Advancing  Person  shall  have  ceased  funding
Advances and/or Servicing Advances (as the case may be) and the Advancing Person
or related Advance  Facility Trustee shall have received  Reimbursement  Amounts
sufficient in the aggregate to

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reimburse all Advances and/or Servicing  Advances (as the case may be) the right
to reimbursement for which were assigned to the Advancing Person,  then upon the
delivery  of a written  notice  signed by the  Advancing  Person  and the Master
Servicer  or its  successor  or assign) to the Trustee  terminating  the Advance
Facility Notice (the "Notice of Facility  Termination"),  the Master Servicer or
its Successor Master Servicer shall again be entitled to withdraw and retain the
related  Reimbursement  Amounts from the Custodial  Account  pursuant to Section
3.10.

      (j) After  delivery of any  Advance  Facility  Notice,  and until any such
Advance Facility Notice has been terminated by a Notice of Facility Termination,
this  Section 3.22 may not be amended or  otherwise  modified  without the prior
written consent of the related Advancing Person.

                                   Article IV

                         PAYMENTS TO CERTIFICATEHOLDERS

      Section 4.01. Certificate Account.

      (a) The Master  Servicer  on behalf of the  Trustee  shall  establish  and
maintain a Certificate  Account in which the Master  Servicer  shall cause to be
deposited  on behalf of the Trustee on or before 2:00 P.M. New York time on each
Certificate Account Deposit Date by wire transfer of immediately available funds
an amount  equal to the sum of (i) any  Advance for the  immediately  succeeding
Distribution  Date,  (ii) any amount required to be deposited in the Certificate
Account pursuant to Section  3.12(a),  (iii) any amount required to be deposited
in the Certificate Account pursuant to Section 3.16(e) or Section 4.07, (iv) any
amount  required to be paid  pursuant to Section 9.01 and (v) all other  amounts
constituting the Available  Distribution  Amount for the immediately  succeeding
Distribution Date.

      (b) The Trustee  shall,  upon written  request  from the Master  Servicer,
invest or cause the institution  maintaining  the Certificate  Account to invest
the funds in the Certificate Account in Permitted Investments  designated in the
name of the  Trustee  for the  benefit of the  Certificateholders,  which  shall
mature or be payable on demand not later than the  Business  Day next  preceding
the  Distribution  Date next following the date of such investment  (except that
(i) any  investment in the  institution  with which the  Certificate  Account is
maintained may mature or be payable on demand on such Distribution Date and (ii)
any other  investment  may mature or be  payable on demand on such  Distribution
Date  if the  Trustee  shall  advance  funds  on such  Distribution  Date to the
Certificate   Account  in  the  amount  payable  on  such   investment  on  such
Distribution  Date,  pending  receipt  thereof to the extent  necessary  to make
distributions on the Certificates) and shall not be sold or disposed of prior to
maturity. Subject to Section 3.16(e), all income and gain realized from any such
investment  shall be for the benefit of the Master Servicer and shall be subject
to its withdrawal or order from time to time. The amount of any losses  incurred
in respect of any such investments shall be deposited in the Certificate Account
by the Master Servicer out of its own funds  immediately as realized without any
right of

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reimbursement.   The  Trustee  or  its   Affiliates  are  permitted  to  receive
compensation that could be deemed to be in the Trustee's economic  self-interest
for (i) serving as investment  adviser (with respect to investments made through
its  Affiliates),  administrator,  shareholder  servicing  agent,  custodian  or
sub-custodian with respect to certain of the Permitted  Investments,  (ii) using
Affiliates to effect  transactions  in certain  Permitted  Investments and (iii)
effecting transactions in certain Permitted Investments.

      Section 4.02. Distributions.

                    As provided in Section 4.02 of the Series Supplement.

      Section 4.03. Statements   to  Certificateholders;  Statements  to  Rating
                    Agencies; Exchange Act Reporting.

      (a) Concurrently with each distribution charged to the Certificate Account
and with respect to each  Distribution Date the Master Servicer shall forward to
the Trustee and the Trustee  shall either  forward by mail or make  available to
each Holder and the Company,  via the Trustee's  internet  website,  a statement
(and at its option,  any additional  files containing the same information in an
alternative  format) setting forth information as to each Class of Certificates,
the  Mortgage  Pool and, if the  Mortgage  Pool is comprised of two or more Loan
Groups,  each Loan Group, to the extent applicable.  This statement will include
the  information set forth in an exhibit to the Series  Supplement.  The Trustee
shall mail to each Holder that  requests a paper copy by  telephone a paper copy
via first class mail.  The Trustee may modify the  distribution  procedures  set
forth in this Section  provided that such  procedures are no less convenient for
the  Certificateholders.  The Trustee shall provide  prior  notification  to the
Company,  the Master  Servicer  and the  Certificateholders  regarding  any such
modification. In addition, the Master Servicer shall provide to any manager of a
trust  fund  consisting  of some  or all of the  Certificates,  upon  reasonable
request,  such additional  information as is reasonably obtainable by the Master
Servicer at no additional  expense to the Master Servicer.  Also, at the request
of a Rating Agency,  the Master Servicer shall provide the information  relating
to the Reportable  Modified  Mortgage Loans  substantially  in the form attached
hereto as Exhibit Q to such Rating  Agency  within a reasonable  period of time;
provided,  however,  that the Master  Servicer  shall not be required to provide
such information more than four times in a calendar year to any Rating Agency.

      (b) Within a reasonable period of time after it receives a written request
from a Holder of a  Certificate,  other than a Class R  Certificate,  the Master
Servicer shall prepare, or cause to be prepared,  and shall forward, or cause to
be  forwarded,  to each Person who at any time during the calendar  year was the
Holder  of a  Certificate,  other  than  a  Class  R  Certificate,  a  statement
containing the  information  set forth in clauses (v) and (vi) of the exhibit to
the Series  Supplement  referred to in subsection (a) above  aggregated for such
calendar  year or  applicable  portion  thereof  during  which such Person was a
Certificateholder.  Such  obligation of the Master  Servicer  shall be deemed to
have been  satisfied  to the extent that  substantially  comparable  information
shall be provided by the Master  Servicer  pursuant to any  requirements  of the
Code.

      (c) Within a reasonable period of time after it receives a written request
from a Holder of a Class R Certificate,  the Master  Servicer shall prepare,  or
cause to be prepared, and

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<PAGE>

shall forward,  or cause to be forwarded,  to each Person who at any time during
the  calendar  year  was  the  Holder  of a  Class R  Certificate,  a  statement
containing the applicable  distribution  information  provided  pursuant to this
Section 4.03  aggregated  for such calendar year or applicable  portion  thereof
during  which  such  Person  was  the  Holder  of a Class  R  Certificate.  Such
obligation of the Master  Servicer shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the Master
Servicer pursuant to any requirements of the Code.

      (d)  Upon  the  written  request  of  any  Certificateholder,  the  Master
Servicer,  as soon as  reasonably  practicable,  shall  provide  the  requesting
Certificateholder with such information as is necessary and appropriate,  in the
Master  Servicer's  sole  discretion,  for  purposes  of  satisfying  applicable
reporting requirements under Rule 144A.

      (e) The Master  Servicer shall, on behalf of the Company and in respect of
the Trust  Fund,  sign and cause to be filed with the  Commission  any  periodic
reports  required to be filed under the  provisions of the Exchange Act, and the
rules  and  regulations  of  the  Commission   thereunder   including,   without
limitation, reports on Form 10-K, Form 10-D and Form 8-K. In connection with the
preparation  and filing of such  periodic  reports,  the  Trustee  shall  timely
provide to the Master Servicer (I) a list of  Certificateholders as shown on the
Certificate  Register as of the end of each  calendar  year,  (II) copies of all
pleadings,  other legal process and any other documents  relating to any claims,
charges or complaints involving the Trustee, as trustee hereunder,  or the Trust
Fund that are received by a Responsible Officer of the Trustee,  (III) notice of
all  matters  that,  to the actual  knowledge  of a  Responsible  Officer of the
Trustee,  have been  submitted to a vote of the  Certificateholders,  other than
those matters that have been  submitted to a vote of the  Certificateholders  at
the  request  of the  Company  or the Master  Servicer,  and (IV)  notice of any
failure of the Trustee to make any  distribution  to the  Certificateholders  as
required pursuant to the Series Supplement.  Neither the Master Servicer nor the
Trustee shall have any liability with respect to the Master  Servicer's  failure
to properly prepare or file such periodic reports  resulting from or relating to
the  Master  Servicer's  inability  or failure  to obtain  any  information  not
resulting from the Master Servicer's own negligence or willful misconduct.

      (f) Any Form  10-K  filed  with the  Commission  in  connection  with this
Section 4.03 shall include,  with respect to the  Certificates  relating to such
10-K:

            (i) A  certification,  signed by the senior officer in charge of the
      servicing  functions  of the  Master  Servicer,  in the form  attached  as
      Exhibit O hereto or such other form as may be required or permitted by the
      Commission  (the  "Form 10-K  Certification"),  in  compliance  with Rules
      13a-14 and 15d-14 under the Exchange Act and any additional  directives of
      the Commission.

            (ii) A report  regarding its  assessment  of  compliance  during the
      preceding  calendar year with all applicable  servicing criteria set forth
      in  relevant  Commission   regulations  with  respect  to  mortgage-backed
      securities  transactions  taken as a whole  involving the Master  Servicer
      that  are  backed  by the same  types  of  assets  as  those  backing  the
      certificates,  as well as similar  reports  on  assessment  of  compliance
      received from other  parties  participating  in the servicing  function as
      required by relevant

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<PAGE>

      Commission regulations, as described in Item 1122(a) of Regulation AB. The
      Master Servicer shall obtain from all other parties  participating  in the
      servicing function any required assessments.

            (iii) With respect to each assessment  report described  immediately
      above, a report by a registered  public  accounting  firm that attests to,
      and reports on, the assessment  made by the asserting  party, as set forth
      in relevant Commission regulations,  as described in Regulation 1122(b) of
      Regulation AB and Section 3.19.

            (iv) The servicer  compliance  certificate  required to be delivered
      pursuant Section 3.18.

      (g) In  connection  with the Form 10-K  Certification,  the Trustee  shall
provide the Master Servicer with a back-up  certification  substantially  in the
form attached hereto as Exhibit P.

      (h) This Section  4.03 may be amended in  accordance  with this  Agreement
without the consent of the Certificateholders.

      (i) The Trustee  shall make  available on the Trustee's  internet  website
each of the  reports  filed with the  Commission  by or on behalf of the Company
under the Exchange Act, as soon as reasonably  practicable upon delivery of such
reports to the Trustee.

      Section  4.04.  Distribution  of Reports to the Trustee  and the  Company;
                      Advances by the Master Servicer.

      (a) Prior to the close of business on the  Determination  Date, the Master
Servicer shall furnish a written statement to the Trustee,  any Paying Agent and
the Company  (the  information  in such  statement  to be made  available to any
Certificate  Insurer and  Certificateholders  by the Master Servicer on request)
setting  forth  (i) the  Available  Distribution  Amount  and (ii)  the  amounts
required to be  withdrawn  from the  Custodial  Account and  deposited  into the
Certificate  Account on the immediately  succeeding  Certificate Account Deposit
Date  pursuant to clause  (iii) of Section  4.01(a).  The  determination  by the
Master  Servicer of such  amounts  shall,  in the absence of obvious  error,  be
presumptively  deemed to be correct for all purposes  hereunder  and the Trustee
shall be protected in relying  upon the same  without any  independent  check or
verification.

      (b) On or before  2:00  P.M.  New York  time on each  Certificate  Account
Deposit Date, the Master  Servicer  shall either (i) deposit in the  Certificate
Account from its own funds, or funds received therefor from the Subservicers, an
amount equal to the Advances to be made by the Master Servicer in respect of the
related  Distribution  Date,  which shall be in an aggregate amount equal to the
aggregate  amount of  Monthly  Payments  (with  each  interest  portion  thereof
adjusted to the Net  Mortgage  Rate),  less the amount of any related  Servicing
Modifications,  Debt Service  Reductions or reductions in the amount of interest
collectable from the Mortgagor pursuant to the Servicemembers  Civil Relief Act,
as  amended,  or similar  legislation  or  regulations  then in  effect,  on the
Outstanding  Mortgage Loans as of the related Due Date,  which Monthly  Payments
were not  received as of the close of  business as of the related  Determination
Date;  provided  that no Advance  shall be made if it would be a  Nonrecoverable
Advance, (ii)

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<PAGE>

withdraw  from  amounts on deposit in the  Custodial  Account and deposit in the
Certificate  Account all or a portion of the Amount Held for Future Distribution
in  discharge  of any such  Advance,  or (iii) make  advances in the form of any
combination of (i) and (ii) aggregating the amount of such Advance.  Any portion
of the Amount  Held for Future  Distribution  so used shall be  replaced  by the
Master  Servicer by deposit in the  Certificate  Account on or before 11:00 A.M.
New York time on any future Certificate  Account Deposit Date to the extent that
funds  attributable  to the Mortgage  Loans that are  available in the Custodial
Account  for  deposit in the  Certificate  Account on such  Certificate  Account
Deposit Date shall be less than  payments to  Certificateholders  required to be
made on the following  Distribution  Date. The Master Servicer shall be entitled
to use any Advance made by a  Subservicer  as described in Section  3.07(b) that
has been deposited in the Custodial  Account on or before such Distribution Date
as part of the Advance  made by the Master  Servicer  pursuant  to this  Section
4.04. The amount of any reimbursement  pursuant to Section 4.02(a) in respect of
outstanding  Advances on any  Distribution  Date shall be  allocated to specific
Monthly  Payments due but delinquent for previous Due Periods,  which allocation
shall be made, to the extent  practicable,  to Monthly  Payments which have been
delinquent for the longest period of time. Such allocations  shall be conclusive
for purposes of  reimbursement to the Master Servicer from recoveries on related
Mortgage Loans pursuant to Section 3.10.

      The determination by the Master Servicer that it has made a Nonrecoverable
Advance or that any proposed Advance, if made, would constitute a Nonrecoverable
Advance,  shall be evidenced by an Officers'  Certificate of the Master Servicer
delivered to the Company and the Trustee.

      If the Master  Servicer  determines  as of the Business Day  preceding any
Certificate  Account  Deposit  Date  that it will be unable  to  deposit  in the
Certificate  Account an amount equal to the Advance  required to be made for the
immediately succeeding Distribution Date, it shall give notice to the Trustee of
its inability to advance (such notice may be given by telecopy),  not later than
3:00 P.M.,  New York time, on such Business Day,  specifying the portion of such
amount  that it will be unable to  deposit.  Not later than 3:00 P.M.,  New York
time, on the Certificate Account Deposit Date the Trustee shall, unless by 12:00
Noon, New York time, on such day the Trustee shall have been notified in writing
(by  telecopy)  that the Master  Servicer  shall  have  directly  or  indirectly
deposited in the  Certificate  Account such portion of the amount of the Advance
as to which  the  Master  Servicer  shall  have  given  notice  pursuant  to the
preceding  sentence,  pursuant to Section 7.01,  (a) terminate all of the rights
and  obligations of the Master  Servicer under this Agreement in accordance with
Section 7.01 and (b) assume the rights and  obligations  of the Master  Servicer
hereunder,  including the  obligation to deposit in the  Certificate  Account an
amount equal to the Advance for the immediately succeeding Distribution Date.

      The Trustee shall  deposit all funds it receives  pursuant to this Section
4.04 into the Certificate Account.

      Section 4.05. Allocation of Realized Losses.

      As provided in Section 4.05 of the Series Supplement.

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<PAGE>

      Section  4.06.  Reports  of  Foreclosures  and  Abandonment  of  Mortgaged
                      Property.

      The Master Servicer or the  Subservicers  shall file  information  returns
with  respect  to the  receipt  of  mortgage  interests  received  in a trade or
business, the reports of foreclosures and abandonments of any Mortgaged Property
and the information returns relating to cancellation of indebtedness income with
respect to any Mortgaged  Property required by Sections 6050H,  6050J and 6050P,
respectively,  of the Code, and deliver to the Trustee an Officers'  Certificate
on or before  March 31 of each year  stating  that such reports have been filed.
Such reports  shall be in form and  substance  sufficient  to meet the reporting
requirements imposed by Sections 6050H, 6050J and 6050P of the Code.

      Section 4.07. Optional Purchase of Defaulted Mortgage Loans.

      (a) With respect to any Mortgage  Loan that is delinquent in payment by 90
days or more,  the Master  Servicer  may, at its option,  purchase such Mortgage
Loan from the  Trustee  at the  Purchase  Price  therefor;  provided,  that such
Mortgage Loan that becomes 90 days or more delinquent  during any given Calendar
Quarter shall only be eligible for purchase  pursuant to this Section during the
period  beginning on the first Business Day of the following  Calendar  Quarter,
and ending at the close of business on the  second-to-last  Business Day of such
following Calendar Quarter; and provided, further, that such Mortgage Loan is 90
days or more delinquent at the time of repurchase.  Such option if not exercised
shall  not  thereafter  be  reinstated  as to  any  Mortgage  Loan,  unless  the
delinquency is cured and the Mortgage Loan thereafter  again becomes  delinquent
in payment by 90 days or more in a subsequent Calendar Quarter.

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

      If,  however,  the  Master  Servicer  shall  have  exercised  its right to
repurchase  a Mortgage  Loan  pursuant  to this  Section  4.07 upon the  written
request of and with funds provided by the Junior Certificateholder and thereupon
transferred  such  Mortgage  Loan to the  Junior  Certificateholder,  the Master
Servicer shall so notify the Trustee in writing.

      Section 4.08. Surety Bond.

      (a) If a Required  Surety  Payment is payable  pursuant to the Surety Bond
with respect to any Additional  Collateral  Loan,  the Master  Servicer shall so
notify the  Trustee as soon as  reasonably  practicable  and the  Trustee  shall
promptly  complete the notice in the form of Attachment 1 to the Surety Bond and
shall promptly submit such notice to the Surety as a claim

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for a Required Surety. The Master Servicer shall upon request assist the Trustee
in  completing  such notice and shall provide any  information  requested by the
Trustee in connection therewith.

      (b) Upon receipt of a Required Surety Payment from the Surety on behalf of
the Holders of  Certificates,  the Trustee shall  deposit such  Required  Surety
Payment in the  Certificate  Account and shall  distribute  such Required Surety
Payment,  or the proceeds thereof,  in accordance with the provisions of Section
4.02.

      (c) The Trustee shall (i) receive as  attorney-in-fact of each Holder of a
Certificate  any Required  Surety  Payment from the Surety and (ii) disburse the
same to the Holders of such Certificates as set forth in Section 4.02.

                                   Article V

                                THE CERTIFICATES

      Section 5.01. The Certificates.

      (a) The  Senior,  Class X, Class M, Class B, Class P, Class SB and Class R
Certificates  shall be  substantially in the forms set forth in Exhibits A, A-I,
B, C, C-I, C-II and D, respectively, or such other form or forms as shall be set
forth in the Series  Supplement,  and shall,  on original issue, be executed and
delivered by the Trustee to the  Certificate  Registrar for  authentication  and
delivery to or upon the order of the Company  upon receipt by the Trustee or the
Custodian of the documents  specified in Section 2.01. The Certificates shall be
issuable in the minimum denominations designated in the Preliminary Statement to
the Series Supplement.

      The  Certificates  shall be executed by manual or  facsimile  signature on
behalf of an authorized officer of the Trustee.  Certificates bearing the manual
or facsimile  signatures of individuals who were at any time the proper officers
of the Trustee shall bind the Trustee,  notwithstanding that such individuals or
any of them have ceased to hold such  offices  prior to the  authentication  and
delivery of such  Certificate  or did not hold such  offices at the date of such
Certificates.  No  Certificate  shall be  entitled  to any  benefit  under  this
Agreement, or be valid for any purpose, unless there appears on such Certificate
a certificate of  authentication  substantially  in the form provided for herein
executed by the Certificate Registrar by manual signature,  and such certificate
upon any Certificate shall be conclusive evidence,  and the only evidence,  that
such  Certificate  has been duly  authenticated  and  delivered  hereunder.  All
Certificates shall be dated the date of their authentication.

      (b) Except as provided below,  registration of Book-Entry Certificates may
not be transferred by the Trustee  except to another  Depository  that agrees to
hold such  Certificates  for the  respective  Certificate  Owners with Ownership
Interests therein.  The Holders of the Book-Entry  Certificates shall hold their
respective  Ownership Interests in and to each of such Certificates  through the
book-entry facilities of the Depository and, except as provided below, shall not
be entitled to Definitive  Certificates in respect of such Ownership  Interests.
All transfers by Certificate Owners of their respective  Ownership  Interests in
the  Book-Entry  Certificates  shall be made in accordance  with the  procedures
established by the Depository  Participant or brokerage firm  representing  such
Certificate Owner. Each Depository

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Participant  shall  transfer  the  Ownership  Interests  only in the  Book-Entry
Certificates of Certificate Owners it represents or of brokerage firms for which
it acts as agent in accordance with the Depository's normal procedures.

      The  Trustee,  the Master  Servicer  and the Company may for all  purposes
(including  the making of payments due on the  respective  Classes of Book-Entry
Certificates)  deal with the Depository as the authorized  representative of the
Certificate  Owners  with  respect  to  the  respective  Classes  of  Book-Entry
Certificates  for the purposes of  exercising  the rights of  Certificateholders
hereunder.  The rights of  Certificate  Owners  with  respect to the  respective
Classes of Book-Entry  Certificates shall be limited to those established by law
and agreements between such Certificate  Owners and the Depository  Participants
and brokerage firms representing such Certificate Owners.  Multiple requests and
directions  from,  and  votes  of,  the  Depository  as  Holder  of any Class of
Book-Entry  Certificates  with  respect to any  particular  matter  shall not be
deemed  inconsistent  if they are made with  respect  to  different  Certificate
Owners.  The Trustee may establish a reasonable  record date in connection  with
solicitations  of consents from or voting by  Certificateholders  and shall give
notice to the Depository of such record date.

      If (i)(A) the Company  advises the Trustee in writing that the  Depository
is no longer  willing or able to  properly  discharge  its  responsibilities  as
Depository and (B) the Company is unable to locate a qualified successor or (ii)
the Company  notifies the  Depository and the Trustee of its intent to terminate
the  book-entry  system  and,  upon  receipt of notice of such  intent  from the
Depository,  the Depository  Participants  holding  beneficial  interests in the
Book-Entry  Certificates agree to such termination  through the Depository,  the
Trustee shall notify all  Certificate  Owners,  through the  Depository,  of the
occurrence of any such event and of the availability of Definitive  Certificates
to Certificate  Owners requesting the same. Upon surrender to the Trustee of the
Book-Entry   Certificates  by  the   Depository,   accompanied  by  registration
instructions from the Depository for registration of transfer, the Trustee shall
execute,  authenticate and deliver the Definitive Certificates.  In addition, if
an Event of Default has  occurred  and is  continuing,  each  Certificate  Owner
materially  adversely  affected  thereby may at its option  request a Definitive
Certificate  evidencing  such  Certificate  Owner's  Percentage  Interest in the
related Class of Certificates. In order to make such a request, such Certificate
Owner shall, subject to the rules and procedures of the Depository,  provide the
Depository  or the  related  Depository  Participant  with  directions  for  the
Certificate  Registrar  to  exchange or cause the  exchange  of the  Certificate
Owner's  interest in such Class of  Certificates  for an  equivalent  Percentage
Interest in fully  registered  definitive  form. Upon receipt by the Certificate
Registrar  of  instructions  from  the  Depository   directing  the  Certificate
Registrar to effect such exchange (such instructions  shall contain  information
regarding the Class of Certificates and the Certificate  Principal Balance being
exchanged,  the Depository  Participant account to be debited with the decrease,
the  registered   holder  of  and  delivery   instructions  for  the  Definitive
Certificate,  and any other information  reasonably  required by the Certificate
Registrar),  (i) the  Certificate  Registrar  shall  instruct the  Depository to
reduce the related Depository Participant's account by the aggregate Certificate
Principal Balance of the Definitive Certificate,  (ii) the Trustee shall execute
and the Certificate Registrar shall authenticate and deliver, in accordance with
the  registration  and  delivery  instructions  provided  by the  Depository,  a
Definitive  Certificate  evidencing such Certificate Owner's Percentage Interest
in such Class of Certificates and (iii) the Trustee shall

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execute  and the  Certificate  Registrar  shall  authenticate  a new  Book-Entry
Certificate  reflecting  the  reduction in the aggregate  Certificate  Principal
Balance of such Class of Certificates by the  Certificate  Principal  Balance of
the Definitive Certificate.

      None of the Company,  the Master  Servicer or the Trustee  shall be liable
for any actions  taken by the  Depository  or its  nominee,  including,  without
limitation,  any delay in delivery of any  instructions  required  under Section
5.01 and may  conclusively  rely on, and shall be  protected in relying on, such
instructions.  Upon the issuance of Definitive Certificates, the Trustee and the
Master  Servicer shall  recognize the Holders of the Definitive  Certificates as
Certificateholders hereunder.

      (c) If the Class A-V Certificates are Definitive  Certificates,  from time
to  time  Residential   Funding,   as  the  initial  Holder  of  the  Class  A-V
Certificates,  may exchange such Holder's Class A-V  Certificates for Subclasses
of Class A-V  Certificates  to be issued under this  Agreement  by  delivering a
"Request for Exchange"  substantially  in the form attached to this Agreement as
Exhibit N executed by an authorized officer, which Subclasses, in the aggregate,
will represent the Uncertificated REMIC Regular Interests Z corresponding to the
Class A-V Certificates so surrendered for exchange. Any Subclass so issued shall
bear  a  numerical  designation  commencing  with  Class  A-V-1  and  continuing
sequentially thereafter, and will evidence ownership of the Uncertificated REMIC
Regular Interest or Interests specified in writing by such initial Holder to the
Trustee.  The Trustee may  conclusively,  without any independent  verification,
rely  on,  and  shall  be  protected  in  relying  on,   Residential   Funding's
determinations of the Uncertificated  REMIC Regular Interests Z corresponding to
any Subclass, the Initial Notional Amount and the initial Pass-Through Rate on a
Subclass as set forth in such Request for Exchange and the Trustee shall have no
duty to determine if any Uncertificated REMIC Regular Interest Z designated on a
Request for Exchange corresponds to a Subclass which has previously been issued.
Each Subclass so issued shall be  substantially in the form set forth in Exhibit
A and shall,  on original issue, be executed and delivered by the Trustee to the
Certificate Registrar for authentication and delivery in accordance with Section
5.01(a).  Every Certificate presented or surrendered for exchange by the initial
Holder  shall (if so required by the Trustee or the  Certificate  Registrar)  be
duly endorsed by, or be accompanied by a written instrument of transfer attached
to such  Certificate  and shall be completed to the  satisfaction of the Trustee
and the  Certificate  Registrar  duly executed by, the initial Holder thereof or
his attorney duly  authorized in writing.  The  Certificates  of any Subclass of
Class  A-V  Certificates  may be  transferred  in  whole,  but not in  part,  in
accordance with the provisions of Section 5.02.

      Section 5.02. Registration of Transfer and Exchange of Certificates.

      (a) The  Trustee  shall cause to be kept at one of the offices or agencies
to be appointed by the Trustee in accordance with the provisions of Section 8.12
a Certificate  Register in which,  subject to such reasonable  regulations as it
may prescribe,  the Trustee shall provide for the  registration  of Certificates
and of transfers and exchanges of Certificates as herein  provided.  The Trustee
is initially  appointed  Certificate  Registrar  for the purpose of  registering
Certificates and transfers and exchanges of Certificates as herein provided. The
Certificate Registrar,  or the Trustee, shall provide the Master Servicer with a
certified list of Certificateholders as of each Record Date prior to the related
Determination Date.

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<PAGE>

      (b) Upon surrender for  registration of transfer of any Certificate at any
office or agency of the Trustee  maintained for such purpose pursuant to Section
8.12 and,  in the case of any Class M, Class B, Class P or Class R  Certificate,
upon  satisfaction of the conditions set forth below,  the Trustee shall execute
and the Certificate Registrar shall authenticate and deliver, in the name of the
designated  transferee or  transferees,  one or more new  Certificates of a like
Class (or Subclass) and aggregate Percentage Interest.

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

      (d)  No  transfer,  sale,  pledge  or  other  disposition  of  a  Class  B
Certificate  or Class P Certificate  shall be made unless such  transfer,  sale,
pledge or other disposition is exempt from the registration  requirements of the
Securities Act of 1933, as amended,  and any applicable state securities laws or
is made in accordance  with said Act and laws. In the event that a transfer of a
Class B  Certificate  or Class P  Certificate  is to be made  either  (i)(A) the
Trustee shall require a written Opinion of Counsel acceptable to and in form and
substance  satisfactory to the Trustee and the Company that such transfer may be
made pursuant to an exemption, describing the applicable exemption and the basis
therefor, from said Act and laws or is being made pursuant to said Act and laws,
which Opinion of Counsel shall not be an expense of the Trustee,  the Company or
the Master Servicer (except that, if such transfer is made by the Company or the
Master  Servicer or any Affiliate  thereof,  the Company or the Master  Servicer
shall provide such Opinion of Counsel at their own expense);  provided that such
Opinion of Counsel will not be required in connection with the initial  transfer
of any such  Certificate by the Company or any Affiliate  thereof to the Company
or an Affiliate of the Company and (B) the Trustee shall require the  transferee
to execute a representation letter, substantially in the form of Exhibit H (with
respect to any Class B Certificate)  or Exhibit G-1 (with respect to any Class P
Certificate)  hereto,  and the Trustee shall require the transferor to execute a
representation  letter,  substantially  in the form of  Exhibit I  hereto,  each
acceptable  to and in form and  substance  satisfactory  to the  Company and the
Trustee  certifying  to the Company and the Trustee the facts  surrounding  such
transfer,  which representation  letters shall not be an expense of the Trustee,
the Company or the Master Servicer;  provided, however, that such representation
letters  will  not be  required  in  connection  with any  transfer  of any such
Certificate  by the  Company  or any  Affiliate  thereof  to the  Company  or an
Affiliate of the Company, and the Trustee shall be entitled to conclusively rely
upon a  representation  (which,  upon the  request  of the  Trustee,  shall be a
written representation) from the Company, of the status of such transferee as an
Affiliate  of  the  Company  or  (ii)  the  prospective  transferee  of  such  a
Certificate shall be required to provide the Trustee, the Company and the Master
Servicer  with an  investment  letter  substantially  in the form of  Exhibit  J
attached hereto (or such other form as the Company in its sole discretion  deems
acceptable), which investment letter shall not be an expense of the Trustee, the
Company or the

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Master Servicer,  and which  investment  letter states that, among other things,
such transferee (A) is a "qualified  institutional  buyer" as defined under Rule
144A,   acting  for  its  own  account  or  the  accounts  of  other  "qualified
institutional  buyers"  as defined  under  Rule 144A,  and (B) is aware that the
proposed   transferor  intends  to  rely  on  the  exemption  from  registration
requirements  under the  Securities  Act of 1933,  as amended,  provided by Rule
144A. The Holder of any such  Certificate  desiring to effect any such transfer,
sale, pledge or other disposition shall, and does hereby agree to, indemnify the
Trustee, the Company, the Master Servicer and the Certificate  Registrar against
any liability that may result if the transfer, sale, pledge or other disposition
is not so exempt or is not made in accordance with such federal and state laws.

      (e)   (i) In the  case of any  Class  B,  Class P or  Class R  Certificate
            presented for registration in the name of any Person, either (A) the
            Trustee  shall  require  an  Opinion  of  Counsel  addressed  to the
            Trustee,  the Company and the Master Servicer,  acceptable to and in
            form and  substance  satisfactory  to the Trustee to the effect that
            the  purchase  or  holding  of such  Class  B,  Class  P or  Class R
            Certificate is permissible under applicable law, will not constitute
            or result in any non-exempt prohibited transaction under Section 406
            of the Employee  Retirement  Income Security Act of 1974, as amended
            ("ERISA"),  or Section 4975 of the Code (or comparable provisions of
            any subsequent  enactments),  and will not subject the Trustee,  the
            Company  or the  Master  Servicer  to any  obligation  or  liability
            (including obligations or liabilities under ERISA or Section 4975 of
            the Code) in addition to those  undertaken in this Agreement,  which
            Opinion of  Counsel  shall not be an  expense  of the  Trustee,  the
            Company or the Master  Servicer  or (B) the  prospective  Transferee
            shall be required to provide the Trustee, the Company and the Master
            Servicer with a  certification  to the effect set forth in paragraph
            six of  Exhibit  H (with  respect  to any  Class B  Certificate)  or
            paragraph  fifteen  of  Exhibit  G-1  (with  respect  to any Class R
            Certificate or Class P Certificate), which the Trustee may rely upon
            without   further   inquiry   or   investigation,   or  such   other
            certifications  as the Trustee may deem  desirable  or  necessary in
            order to establish that such  Transferee or the Person in whose name
            such registration is requested either (a) is not an employee benefit
            plan or other plan subject to the prohibited  transaction provisions
            of ERISA or Section 4975 of the Code,  or any Person  (including  an
            investment manager, a named fiduciary or a trustee of any such plan)
            who is  using  "plan  assets"  of  any  such  plan  to  effect  such
            acquisition  (each,  a "Plan  Investor")  or (b) in the  case of any
            Class B Certificate,  the following  conditions  are satisfied:  (i)
            such  Transferee is an insurance  company,  (ii) the source of funds
            used to purchase or hold such  Certificate (or interest  therein) is
            an  "insurance   company  general   account"  (as  defined  in  U.S.
            Department of Labor Prohibited  Transaction Class Exemption ("PTCE")
            95-60,  and (iii) the  conditions set forth in Sections I and III of
            PTCE 95-60 have been  satisfied  (each  entity that  satisfies  this
            clause (b), a "Complying Insurance Company").

            (ii) Any Transferee of a Class M Certificate  will be deemed to have
            represented by virtue of its purchase or holding of such Certificate
            (or interest  therein) that either (a) such Transferee is not a Plan
            Investor,  (b) it has acquired and is holding  such  Certificate  in
            reliance on Prohibited  Transaction Exemption

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<PAGE>

            ("PTE") 94-29, as most recently amended,  PTE 2002-41,  67 Fed. Reg.
            54487  (August  22,  2002)  (the  "RFC  Exemption"),   and  that  it
            understands that there are certain conditions to the availability of
            the RFC Exemption  including that such Certificate must be rated, at
            the time of purchase,  not lower than "BBB-" (or its  equivalent) by
            Standard  & Poor's,  Fitch or Moody's  or (c) such  Transferee  is a
            Complying Insurance Company.

            (iii) (A) If any Class M  Certificate  (or any interest  therein) is
            acquired or held by any Person that does not satisfy the  conditions
            described  in  paragraph   (ii)  above,   then  the  last  preceding
            Transferee  that either (i) is not a Plan  Investor,  (ii)  acquired
            such Certificate in compliance with the RFC Exemption, or (iii) is a
            Complying  Insurance  Company  shall  be  restored,  to  the  extent
            permitted by law, to all rights and obligations as Certificate Owner
            thereof  retroactive  to the date of such  Transfer  of such Class M
            Certificate.  The Trustee  shall be under no liability to any Person
            for making any payments due on such  Certificate  to such  preceding
            Transferee.

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

      (f) (i) Each Person who has or who  acquires any  Ownership  Interest in a
Class R Certificate  shall be deemed by the  acceptance or  acquisition  of such
Ownership Interest to have agreed to be bound by the following provisions and to
have  irrevocably  authorized the Trustee or its designee under clause  (iii)(A)
below to deliver  payments to a Person  other than such Person and to  negotiate
the terms of any mandatory  sale under clause  (iii)(B) below and to execute all
instruments of transfer and to do all other things  necessary in connection with
any such sale. The rights of each Person  acquiring any Ownership  Interest in a
Class R Certificate are expressly subject to the following provisions:

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

                  (B) In connection with any proposed  Transfer of any Ownership
            Interest  in a  Class  R  Certificate,  the  Trustee  shall  require
            delivery to it, and shall not  register  the Transfer of any Class R
            Certificate  until its receipt of, (I) an affidavit and agreement (a
            "Transfer  Affidavit and  Agreement," in the form attached hereto as
            Exhibit G-1) from the  proposed  Transferee,  in form and  substance
            satisfactory to the Master  Servicer,  representing  and warranting,
            among other things,  that it is a Permitted  Transferee,  that it is
            not acquiring its Ownership Interest in the Class R Certificate that
            is the subject of the  proposed  Transfer  as a nominee,  trustee or
            agent for any Person who is not a Permitted Transferee,  that for so
            long as it retains its Ownership  Interest in a Class R Certificate,
            it will

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<PAGE>

            endeavor to remain a Permitted Transferee,  and that it has reviewed
            the  provisions  of this  Section  5.02(f) and agrees to be bound by
            them, and (II) a certificate, in the form attached hereto as Exhibit
            G-2, from the Holder wishing to transfer the Class R Certificate, in
            form and substance satisfactory to the Master Servicer, representing
            and warranting,  among other things, that no purpose of the proposed
            Transfer is to impede the assessment or collection of tax.

                  (C)  Notwithstanding  the delivery of a Transfer Affidavit and
            Agreement  by a proposed  Transferee  under  clause (B) above,  if a
            Responsible Officer of the Trustee who is assigned to this Agreement
            has actual knowledge that the proposed Transferee is not a Permitted
            Transferee,  no  Transfer  of an  Ownership  Interest  in a  Class R
            Certificate to such proposed Transferee shall be effected.

                  (D) Each Person holding or acquiring any Ownership Interest in
            a  Class  R  Certificate  shall  agree  (x) to  require  a  Transfer
            Affidavit  and  Agreement  from any other Person to whom such Person
            attempts to transfer its Ownership Interest in a Class R Certificate
            and (y) not to transfer its Ownership  Interest unless it provides a
            certificate  to the Trustee in the form  attached  hereto as Exhibit
            G-2.

                  (E) Each Person holding or acquiring an Ownership  Interest in
            a Class R Certificate,  by purchasing an Ownership  Interest in such
            Certificate,  agrees to give the Trustee written notice that it is a
            "pass-through  interest  holder"  within the  meaning  of  Temporary
            Treasury  Regulations Section  1.67-3T(a)(2)(i)(A)  immediately upon
            acquiring an Ownership Interest in a Class R Certificate,  if it is,
            or is holding an  Ownership  Interest  in a Class R  Certificate  on
            behalf of, a "pass-through interest holder."

            (ii)  The  Trustee  shall  register  the  Transfer  of any  Class  R
      Certificate  only if it shall have  received  the Transfer  Affidavit  and
      Agreement,  a certificate  of the Holder  requesting  such transfer in the
      form  attached  hereto as Exhibit G-2 and all of such other  documents  as
      shall have been reasonably  required by the Trustee as a condition to such
      registration.  Transfers of the Class R Certificates to Non-United  States
      Persons and Disqualified  Organizations (as defined in Section  860E(e)(5)
      of the Code) are prohibited.

            (iii) (A) If any Disqualified  Organization shall become a holder of
      a Class R Certificate,  then the last preceding Permitted Transferee shall
      be restored, to the extent permitted by law, to all rights and obligations
      as Holder thereof retroactive to the date of registration of such Transfer
      of such Class R Certificate.  If a Non-United States Person shall become a
      holder of a Class R  Certificate,  then the last  preceding  United States
      Person  shall be restored,  to the extent  permitted by law, to all rights
      and obligations as Holder thereof  retroactive to the date of registration
      of such Transfer of such Class R  Certificate.  If a transfer of a Class R
      Certificate  is  disregarded   pursuant  to  the  provisions  of  Treasury
      Regulations Section 1.860E-1 or Section 1.860G-3,  then the last preceding
      Permitted Transferee shall be restored, to the extent permitted by law, to
      all rights and  obligations as Holder  thereof  retroactive to the date of
      registration of such Transfer of

                                       87
<PAGE>

      such Class R  Certificate.  The Trustee shall be under no liability to any
      Person for any  registration of Transfer of a Class R Certificate  that is
      in fact not  permitted by this Section  5.02(f) or for making any payments
      due on such  Certificate  to the  holder  thereof  or for taking any other
      action with respect to such holder under the provisions of this Agreement.

                  (B) If any  purported  Transferee  shall  become a Holder of a
            Class R Certificate in violation of the restrictions in this Section
            5.02(f) and to the extent that the  retroactive  restoration  of the
            rights of the Holder of such Class R  Certificate  as  described  in
            clause  (iii)(A) above shall be invalid,  illegal or  unenforceable,
            then the Master Servicer shall have the right, without notice to the
            holder or any prior holder of such Class R Certificate, to sell such
            Class R Certificate to a purchaser  selected by the Master  Servicer
            on such terms as the Master  Servicer  may  choose.  Such  purported
            Transferee   shall  promptly   endorse  and  deliver  each  Class  R
            Certificate  in  accordance  with  the  instructions  of the  Master
            Servicer.  Such purchaser may be the Master  Servicer  itself or any
            Affiliate of the Master Servicer.  The proceeds of such sale, net of
            the commissions (which may include commissions payable to the Master
            Servicer or its  Affiliates),  expenses and taxes due, if any, shall
            be remitted by the Master Servicer to such purported Transferee. The
            terms and conditions of any sale under this clause (iii)(B) shall be
            determined in the sole  discretion of the Master  Servicer,  and the
            Master  Servicer  shall  not be  liable  to  any  Person  having  an
            Ownership  Interest  in a Class R  Certificate  as a  result  of its
            exercise of such discretion.

            (iv) The  Master  Servicer,  on behalf of the  Trustee,  shall  make
      available,   upon  written  request  from  the  Trustee,  all  information
      necessary to compute any tax imposed (A) as a result of the Transfer of an
      Ownership  Interest  in a  Class  R  Certificate  to any  Person  who is a
      Disqualified  Organization,  including the information  regarding  "excess
      inclusions"  of such Class R  Certificates  required to be provided to the
      Internal  Revenue  Service and certain  Persons as  described  in Treasury
      Regulations  Sections  1.860D-1(b)(5)  and  1.860E-2(a)(5),  and  (B) as a
      result of any regulated investment company,  real estate investment trust,
      common trust fund, partnership, trust, estate or organization described in
      Section  1381 of the Code that holds an  Ownership  Interest  in a Class R
      Certificate  having as among its record holders at any time any Person who
      is a Disqualified Organization. Reasonable compensation for providing such
      information may be required by the Master Servicer from such Person.

            (v) The  provisions of this Section  5.02(f) set forth prior to this
      clause (v) may be modified,  added to or  eliminated,  provided that there
      shall have been delivered to the Trustee the following:

                  (A) written notification from each Rating Agency to the effect
            that the modification, addition to or elimination of such provisions
            will not cause such  Rating  Agency to  downgrade  its  then-current
            ratings,  if any,  of any  Class of the  Senior  (in the case of the
            Insured  Certificates  (as defined in the Series  Supplement),  such
            determination shall be made without giving effect to the

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            Certificate Policy (as defined in the Series  Supplement)),  Class M
            or Class B Certificates  below the lower of the then-current  rating
            or the rating  assigned to such  Certificates as of the Closing Date
            by such Rating Agency; and

                  (B) subject to Section 10.01(f),  an Officers'  Certificate of
            the Master Servicer stating that the Master Servicer has received an
            Opinion of Counsel, in form and substance satisfactory to the Master
            Servicer,  to the  effect  that such  modification,  addition  to or
            absence of such  provisions  will not cause any portion of any REMIC
            formed  under the Series  Supplement  to cease to qualify as a REMIC
            and will not cause (x) any  portion  of any REMIC  formed  under the
            Series Supplement to be subject to an entity-level tax caused by the
            Transfer  of  any  Class  R  Certificate  to  a  Person  that  is  a
            Disqualified  Organization  or (y) a  Certificateholder  or  another
            Person to be subject to a  REMIC-related  tax caused by the Transfer
            of a  Class  R  Certificate  to a  Person  that  is not a  Permitted
            Transferee.

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

      (h) All  Certificates  surrendered  for  transfer  and  exchange  shall be
destroyed by the Certificate Registrar.

      Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.

      If (i)  any  mutilated  Certificate  is  surrendered  to  the  Certificate
Registrar,  or the Trustee and the  Certificate  Registrar  receive  evidence to
their  satisfaction of the destruction,  loss or theft of any  Certificate,  and
(ii) there is  delivered  to the  Trustee  and the  Certificate  Registrar  such
security or indemnity as may be required by them to save each of them  harmless,
then, in the absence of notice to the Trustee or the Certificate  Registrar that
such  Certificate has been acquired by a bona fide purchaser,  the Trustee shall
execute  and the  Certificate  Registrar  shall  authenticate  and  deliver,  in
exchange  for or in lieu  of any  such  mutilated,  destroyed,  lost  or  stolen
Certificate,  a new Certificate of like tenor, Class and Percentage Interest but
bearing a number not contemporaneously outstanding. Upon the issuance of any new
Certificate  under this  Section,  the  Trustee may require the payment of a sum
sufficient to cover any tax or other governmental  charge that may be imposed in
relation thereto and any other expenses  (including the fees and expenses of the
Trustee  and the  Certificate  Registrar)  connected  therewith.  Any  duplicate
Certificate  issued  pursuant to this  Section  shall  constitute  complete  and
indefeasible  evidence of ownership in the Trust Fund, as if originally  issued,
whether or not the lost,  stolen or destroyed  Certificate shall be found at any
time.

      Section 5.04. Persons Deemed Owners.

      Prior to due  presentation of a Certificate for  registration of transfer,
the Company,  the Master Servicer,  the Trustee,  any Certificate  Insurer,  the
Certificate  Registrar and any agent of the Company,  the Master  Servicer,  the
Trustee, any Certificate Insurer or the Certificate

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Registrar  may treat the Person in whose name any  Certificate  is registered as
the  owner  of such  Certificate  for the  purpose  of  receiving  distributions
pursuant to Section 4.02 and for all other purposes whatsoever, except as and to
the extent  provided in the definition of  "Certificateholder,"  and neither the
Company,  the  Master  Servicer,  the  Trustee,  any  Certificate  Insurer,  the
Certificate  Registrar nor any agent of the Company,  the Master  Servicer,  the
Trustee, any Certificate Insurer or the Certificate  Registrar shall be affected
by notice to the contrary except as provided in Section 5.02(f).

      Section 5.05. Appointment of Paying Agent.

      The  Trustee  may  appoint  a  Paying  Agent  for the  purpose  of  making
distributions to the  Certificateholders  pursuant to Section 4.02. In the event
of any  such  appointment,  on or  prior to each  Distribution  Date the  Master
Servicer on behalf of the Trustee  shall  deposit or cause to be deposited  with
the Paying Agent a sum sufficient to make the payments to the Certificateholders
in the amounts and in the manner  provided for in Section  4.02,  such sum to be
held in trust for the benefit of the Certificateholders.

      The Trustee  shall  cause each Paying  Agent to execute and deliver to the
Trustee an  instrument  in which such Paying  Agent shall agree with the Trustee
that such  Paying  Agent  shall hold all sums held by it for the  payment to the
Certificateholders in trust for the benefit of the  Certificateholders  entitled
thereto until such sums shall be  distributed  to such  Certificateholders.  Any
sums so held by such Paying Agent shall be held only in Eligible Accounts to the
extent such sums are not  distributed to the  Certificateholders  on the date of
receipt by such Paying Agent.

      Section 5.06. U.S.A. Patriot Act Compliance.

      In order for it to comply with its duties  under the U.S.A.  Patriot  Act,
the Trustee may obtain and verify  certain  information  from the other  parties
hereto,  including  but not  limited to such  parties'  name,  address and other
identifying information.

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                                   Article VI

                       THE COMPANY AND THE MASTER SERVICER

      Section  6.01.  Respective  Liabilities  of the  Company  and  the  Master
                      Servicer.

      The Company  and the Master  Servicer  shall each be liable in  accordance
herewith only to the extent of the  obligations  specifically  and  respectively
imposed upon and undertaken by the Company and the Master  Servicer  herein.  By
way of  illustration  and not  limitation,  the  Company  is not  liable for the
servicing  and  administration  of the  Mortgage  Loans,  nor is it obligated by
Section 7.01 or Section 10.01 to assume any  obligations of the Master  Servicer
or to appoint a designee  to assume such  obligations,  nor is it liable for any
other  obligation  hereunder that it may, but is not obligated to, assume unless
it elects to assume such obligation in accordance herewith.

      Section  6.02.  Merger  or  Consolidation  of the  Company  or the  Master
                      Servicer; Assignment of Rights and Delegation of Duties by
                      Master Servicer.

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

      (b) Any Person into which the Company or the Master Servicer may be merged
or converted or with which it may be consolidated,  or any Person resulting from
any  merger,  conversion  or  consolidation  to which the  Company or the Master
Servicer  shall be a party,  or any Person  succeeding  to the  business  of the
Company or the Master  Servicer,  shall be the  successor  of the Company or the
Master Servicer, as the case may be, hereunder,  without the execution or filing
of any  paper  or any  further  act on the  part of any of the  parties  hereto,
anything in this  Section  6.02(b) to the  contrary  notwithstanding;  provided,
however,  that the successor or surviving Person to the Master Servicer shall be
qualified to service  mortgage loans on behalf of Fannie Mae or Freddie Mac; and
provided further that the Master Servicer (or the Company,  as applicable) shall
notify  each  Rating  Agency and the  Trustee  in  writing  of any such  merger,
conversion or consolidation at least 30 days prior to the effective date of such
event.

      (c) Notwithstanding anything else in this Section 6.02 and Section 6.04 to
the contrary,  the Master Servicer may assign its rights and delegate its duties
and obligations  under this Agreement;  provided that the Person  accepting such
assignment  or  delegation  shall be a  Person  which is  qualified  to  service
mortgage   loans  on  behalf  of  Fannie  Mae  or  Freddie  Mac,  is  reasonably
satisfactory to the Trustee and the Company,  is willing to service the Mortgage
Loans and executes and delivers to the Company and the Trustee an agreement,  in
form and substance reasonably satisfactory to the Company and the Trustee, which
contains an  assumption by such Person of the due and punctual  performance  and
observance  of each  covenant  and  condition to be performed or observed by the
Master Servicer under this Agreement; provided further that

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each Rating Agency's  rating of the Classes of Certificates  (in the case of the
Insured  Certificates (as defined in the Series Supplement),  such determination
shall be made without giving effect to the Certificate Policy (as defined in the
Series  Supplement))  that have been rated in effect  immediately  prior to such
assignment  and  delegation  will not be  qualified,  reduced or  withdrawn as a
result of such  assignment  and  delegation  (as  evidenced  by a letter to such
effect  from  each  Rating  Agency).  In the  case of any  such  assignment  and
delegation,  the Master  Servicer shall be released from its  obligations  under
this  Agreement,  except that the Master  Servicer  shall remain  liable for all
liabilities and obligations incurred by it as Master Servicer hereunder prior to
the  satisfaction  of the conditions to such assignment and delegation set forth
in the next preceding sentence. Notwithstanding the foregoing, in the event of a
pledge or assignment by the Master Servicer solely of its rights to purchase all
assets of the Trust Fund under  Section  9.01(a) (or, if so specified in Section
9.01(a), its rights to purchase the Mortgage Loans and property acquired related
to such  Mortgage  Loans or its  rights to  purchase  the  Certificates  related
thereto), the provisos of the first sentence of this paragraph will not apply.

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

      Neither  the  Company,  the  Master  Servicer  nor  any of the  directors,
officers,  employees  or agents of the Company or the Master  Servicer  shall be
under any liability to the Trust Fund or the  Certificateholders  for any action
taken or for refraining  from the taking of any action in good faith pursuant to
this  Agreement,  or for  errors  in  judgment;  provided,  however,  that  this
provision shall not protect the Company,  the Master Servicer or any such Person
against any breach of warranties or representations made herein or any liability
which would otherwise be imposed by reason of willful misfeasance,  bad faith or
gross negligence in the performance of duties or by reason of reckless disregard
of obligations and duties  hereunder.  The Company,  the Master Servicer and any
director,  officer,  employee or agent of the Company or the Master Servicer may
rely in good faith on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising  hereunder.  The Company,
the Master Servicer and any director,  officer, employee or agent of the Company
or the Master  Servicer shall be indemnified by the Trust Fund and held harmless
against any loss,  liability or expense  incurred in  connection  with any legal
action  relating to this  Agreement  or the  Certificates,  other than any loss,
liability or expense  related to any specific  Mortgage  Loan or Mortgage  Loans
(except as any such loss,  liability or expense shall be otherwise  reimbursable
pursuant  to this  Agreement)  and any loss,  liability  or expense  incurred by
reason of willful misfeasance,  bad faith or gross negligence in the performance
of duties hereunder or by reason of reckless disregard of obligations and duties
hereunder.

      Neither the Company nor the Master  Servicer shall be under any obligation
to  appear  in,  prosecute  or  defend  any  legal  or  administrative   action,
proceeding,  hearing or  examination  that is not  incidental to its  respective
duties  under this  Agreement  and which in its  opinion  may  involve it in any
expense or liability; provided, however, that the Company or the Master Servicer
may  in its  discretion  undertake  any  such  action,  proceeding,  hearing  or
examination that it may deem necessary or desirable in respect to this Agreement
and the  rights  and  duties of the  parties  hereto  and the  interests  of the
Certificateholders  hereunder.  In such event,  the legal  expenses and costs of
such action,  proceeding,  hearing or  examination  and any liability  resulting
therefrom  shall be expenses,  costs and  liabilities of the Trust Fund, and the
Company and the Master Servicer shall

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be  entitled  to be  reimbursed  therefor  out of  amounts  attributable  to the
Mortgage  Loans on deposit in the Custodial  Account as provided by Section 3.10
and, on the Distribution Date(s) following such reimbursement,  the aggregate of
such  expenses  and  costs  shall  be  allocated  in  reduction  of the  Accrued
Certificate  Interest  on each Class  entitled  thereto in the same manner as if
such expenses and costs constituted a Prepayment Interest Shortfall.

      Section 6.04. Company and Master Servicer Not to Resign.

      Subject to the  provisions  of Section  6.02,  neither the Company nor the
Master  Servicer shall resign from its respective  obligations and duties hereby
imposed on it except upon  determination that its duties hereunder are no longer
permissible  under  applicable  law.  Any  such  determination   permitting  the
resignation  of the  Company or the Master  Servicer  shall be  evidenced  by an
Opinion of Counsel to such effect delivered to the Trustee.  No such resignation
by the Master  Servicer shall become  effective until the Trustee or a successor
servicer  shall  have  assumed  the  Master  Servicer's   responsibilities   and
obligations in accordance with Section 7.02.

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                                   Article VII

                                     DEFAULT

      Section 7.01. Events of Default.

      Event of Default,  wherever  used herein,  means any one of the  following
events  (whatever  reason  for such  Event of  Default  and  whether it shall be
voluntary or  involuntary  or be effected by operation of law or pursuant to any
judgment,  decree or order of any court or any order,  rule or regulation of any
administrative or governmental body):

            (i) the  Master  Servicer  shall  fail to  deposit  or  cause  to be
      deposited  into the  Certificate  Account  any  amounts  required to be so
      deposited  therein  at the  time  required  pursuant  to  Section  4.01 or
      otherwise or the Master  Servicer  shall fail to distribute or cause to be
      distributed to the Holders of Certificates  of any Class any  distribution
      required to be made under the terms of the  Certificates of such Class and
      this Agreement and, in each case,  such failure shall continue  unremedied
      for a period of 5 days  after the date upon which  written  notice of such
      failure,  requiring such failure to be remedied,  shall have been given to
      the  Master  Servicer  by the  Trustee  or the  Company  or to the  Master
      Servicer,  the Company and the Trustee by the Holders of  Certificates  of
      such Class evidencing  Percentage Interests aggregating not less than 25%;
      or

            (ii) the  Master  Servicer  shall  fail to observe or perform in any
      material  respect any other of the  covenants or agreements on the part of
      the Master Servicer  contained in the Certificates of any Class or in this
      Agreement and such failure shall  continue  unremedied  for a period of 30
      days (except that such number of days shall be 15 in the case of a failure
      to pay the premium for any Required  Insurance  Policy)  after the date on
      which written  notice of such failure,  requiring the same to be remedied,
      shall  have  been  given to the  Master  Servicer  by the  Trustee  or the
      Company,  or to the Master  Servicer,  the  Company and the Trustee by the
      Holders of Certificates of any Class  evidencing,  in the case of any such
      Class, Percentage Interests aggregating not less than 25%; or

            (iii)  a  decree  or  order  of a court  or  agency  or  supervisory
      authority having jurisdiction in the premises in an involuntary case under
      any present or future federal or state  bankruptcy,  insolvency or similar
      law  or  appointing  a  conservator  or  receiver  or  liquidator  in  any
      insolvency, readjustment of debt, marshalling of assets and liabilities or
      similar proceedings,  or for the winding-up or liquidation of its affairs,
      shall have been  entered  against the Master  Servicer  and such decree or
      order shall have remained in force  undischarged  or unstayed for a period
      of 60 days; or

            (iv) the  Master  Servicer  shall  consent to the  appointment  of a
      conservator or receiver or liquidator in any  insolvency,  readjustment of
      debt, marshalling of assets and liabilities, or similar proceedings of, or
      relating  to,  the  Master   Servicer  or  of,  or  relating  to,  all  or
      substantially all of the property of the Master Servicer; or

            (v) the Master  Servicer shall admit in writing its inability to pay
      its debts  generally as they become due, file a petition to take advantage
      of, or commence a

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<PAGE>

      voluntary case under, any applicable insolvency or reorganization statute,
      make an  assignment  for the  benefit  of its  creditors,  or  voluntarily
      suspend payment of its obligations; or

            (vi) the Master  Servicer  shall  notify  the  Trustee  pursuant  to
      Section 4.04(b) that it is unable to deposit in the Certificate Account an
      amount equal to the Advance.

      If an Event of Default  described in clauses (i)-(v) of this Section shall
occur,  then,  and in each and every such case, so long as such Event of Default
shall not have been remedied,  either the Company or the Trustee may, and at the
direction  of Holders  of  Certificates  entitled  to at least 51% of the Voting
Rights,  the Trustee shall,  by notice in writing to the Master Servicer (and to
the Company if given by the Trustee or to the Trustee if given by the  Company),
terminate all of the rights and  obligations  of the Master  Servicer under this
Agreement and in and to the Mortgage Loans and the proceeds thereof,  other than
its rights as a Certificateholder hereunder. If an Event of Default described in
clause (vi) hereof  shall  occur,  the  Trustee  shall,  by notice to the Master
Servicer  and  the  Company,   immediately  terminate  all  of  the  rights  and
obligations  of the  Master  Servicer  under  this  Agreement  and in and to the
Mortgage  Loans  and  the  proceeds   thereof,   other  than  its  rights  as  a
Certificateholder  hereunder  as  provided in Section  4.04(b).  On or after the
receipt by the Master Servicer of such written  notice,  all authority and power
of the  Master  Servicer  under  this  Agreement,  whether  with  respect to the
Certificates  (other  than  as a  Holder  thereof)  or  the  Mortgage  Loans  or
otherwise, shall subject to Section 7.02 pass to and be vested in the Trustee or
the  Trustee's  designee  appointed  pursuant  to  Section  7.02;  and,  without
limitation,  the  Trustee is hereby  authorized  and  empowered  to execute  and
deliver, on behalf of the Master Servicer, as attorney-in-fact or otherwise, any
and all documents and other instruments,  and to do or accomplish all other acts
or things  necessary  or  appropriate  to effect the  purposes of such notice of
termination,  whether to complete the transfer and  endorsement or assignment of
the Mortgage  Loans and related  documents,  or otherwise.  The Master  Servicer
agrees to cooperate with the Trustee in effecting the  termination of the Master
Servicer's responsibilities and rights hereunder, including, without limitation,
the transfer to the Trustee or its designee for administration by it of all cash
amounts  which  shall at the time be credited  to the  Custodial  Account or the
Certificate  Account or  thereafter  be received  with  respect to the  Mortgage
Loans. No such  termination  shall release the Master Servicer for any liability
that it would  otherwise  have  hereunder  for any act or omission  prior to the
effective time of such termination.

      Notwithstanding  any termination of the activities of Residential  Funding
in its  capacity as Master  Servicer  hereunder,  Residential  Funding  shall be
entitled  to  receive,  out of any late  collection  of a Monthly  Payment  on a
Mortgage  Loan  which  was  due  prior  to the  notice  terminating  Residential
Funding's rights and obligations as Master Servicer hereunder and received after
such notice,  that portion to which Residential Funding would have been entitled
pursuant to Sections 3.10(a)(ii), (vi) and (vii) as well as its Servicing Fee in
respect thereof,  and any other amounts payable to Residential Funding hereunder
the  entitlement  to which  arose  prior to the  termination  of its  activities
hereunder.  Upon the  termination  of  Residential  Funding  as Master  Servicer
hereunder the Company shall deliver to the Trustee a copy of the Program Guide.

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      Section 7.02. Trustee or Company to Act; Appointment of Successor.

      (a) On and  after  the time  the  Master  Servicer  receives  a notice  of
termination pursuant to Section 7.01 or resigns in accordance with Section 6.04,
the Trustee or, upon notice to the Company and with the Company's consent (which
shall not be  unreasonably  withheld) a designee  (which meets the standards set
forth  below) of the  Trustee,  shall be the  successor  in all  respects to the
Master  Servicer  in its  capacity  as  servicer  under this  Agreement  and the
transactions  set forth or  provided  for herein and shall be subject to all the
responsibilities,  duties and liabilities  relating thereto placed on the Master
Servicer (except for the  responsibilities,  duties and liabilities contained in
Sections 2.02 and 2.03(a),  excluding the duty to notify related Subservicers or
Sellers as set forth in such Sections, and its obligations to deposit amounts in
respect of losses incurred prior to such notice or termination on the investment
of funds  in the  Custodial  Account  or the  Certificate  Account  pursuant  to
Sections  3.07(c) and  4.01(b) by the terms and  provisions  hereof);  provided,
however,  that any failure to perform such duties or responsibilities  caused by
the  preceding  Master  Servicer's  failure to provide  information  required by
Section  4.04 shall not be  considered  a default by the Trustee  hereunder.  As
compensation  therefor,  the Trustee shall be entitled to all funds  relating to
the Mortgage Loans which the Master  Servicer would have been entitled to charge
to the Custodial  Account or the Certificate  Account if the Master Servicer had
continued to act  hereunder  and, in  addition,  shall be entitled to the income
from any Permitted  Investments  made with amounts  attributable to the Mortgage
Loans held in the Custodial Account or the Certificate  Account.  If the Trustee
has become the successor to the Master  Servicer in accordance with Section 6.04
or Section 7.01, then notwithstanding the above, the Trustee may, if it shall be
unwilling to so act, or shall, if it is unable to so act, appoint, or petition a
court of competent  jurisdiction to appoint,  any  established  housing and home
finance  institution,  which  is  also a  Fannie  Mae- or  Freddie  Mac-approved
mortgage servicing institution,  having a net worth of not less than $10,000,000
as the successor to the Master  Servicer  hereunder in the  assumption of all or
any part of the  responsibilities,  duties or liabilities of the Master Servicer
hereunder.  Pending appointment of a successor to the Master Servicer hereunder,
the Trustee shall become  successor to the Master Servicer and shall act in such
capacity as  hereinabove  provided.  In  connection  with such  appointment  and
assumption,  the Trustee may make such arrangements for the compensation of such
successor  out of  payments  on Mortgage  Loans as it and such  successor  shall
agree;  provided,  however, that no such compensation shall be in excess of that
permitted the initial Master Servicer hereunder.  The Company,  the Trustee, the
Custodian  and such  successor  shall  take such  action,  consistent  with this
Agreement,  as  shall be  necessary  to  effectuate  any  such  succession.  The
Servicing  Fee for any  successor  Master  Servicer  appointed  pursuant to this
Section 7.02 will be lowered with respect to those Mortgage Loans, if any, where
the Subservicing Fee accrues at a rate of less than 0.20% per annum in the event
that the successor Master Servicer is not servicing such Mortgage Loans directly
and it is necessary to raise the related Subservicing Fee to a rate of 0.20% per
annum in order to hire a Subservicer  with respect to such Mortgage  Loans.  The
Master  Servicer shall pay the reasonable  expenses of the Trustee in connection
with any servicing transition hereunder.

      (b) In  connection  with the  termination  or  resignation  of the  Master
Servicer  hereunder,  either (i) the successor  Master  Servicer,  including the
Trustee if the Trustee is acting as successor Master  Servicer,  shall represent
and warrant that it is a member of MERS in

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

      Section 7.03. Notification to Certificateholders.

      (a) Upon any such  termination or appointment of a successor to the Master
Servicer,   the  Trustee  shall  give  prompt  written  notice  thereof  to  the
Certificateholders  at their respective  addresses  appearing in the Certificate
Register.

      (b)  Within 60 days  after the  occurrence  of any Event of  Default,  the
Trustee  shall  transmit by mail to all Holders of  Certificates  notice of each
such Event of  Default  hereunder  known to the  Trustee,  unless  such Event of
Default shall have been cured or waived.

      Section 7.04. Waiver of Events of Default.

      The Holders  representing  at least 66% of the Voting Rights affected by a
default  or Event of  Default  hereunder  may  waive  such  default  or Event of
Default; provided,  however, that (a) a default or Event of Default under clause
(i) of Section  7.01 may be waived  only by all of the  Holders of  Certificates
affected by such default or Event of Default and (b) no waiver  pursuant to this
Section 7.04 shall affect the Holders of Certificates in the manner set forth in
Section  11.01(b)(i)  or (ii).  Upon any such  waiver of a  default  or Event of
Default by the Holders  representing  the requisite  percentage of Voting Rights
affected by such  default or Event of Default,  such default or Event of Default
shall cease to exist and shall be deemed to have been remedied for every purpose
hereunder.  No such waiver shall extend to any  subsequent  or other  default or
Event of  Default or impair any right  consequent  thereon  except to the extent
expressly so waived.

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                                  Article VIII

                             CONCERNING THE TRUSTEE

      Section 8.01. Duties of Trustee.

      (a) The Trustee,  prior to the occurrence of an Event of Default and after
the  curing  or  waiver  of all  Events  of  Default  which  may have  occurred,
undertakes to perform such duties and only such duties as are  specifically  set
forth in this Agreement. In case an Event of Default has occurred (which has not
been cured or waived),  the Trustee shall exercise such of the rights and powers
vested  in it by this  Agreement,  and use the same  degree of care and skill in
their  exercise  as  a  prudent   investor  would  exercise  or  use  under  the
circumstances in the conduct of such investor's own affairs.

      (b)  The  Trustee,   upon  receipt  of  all   resolutions,   certificates,
statements,  opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically  required to be furnished  pursuant to any
provision  of this  Agreement,  shall  examine  them to  determine  whether they
conform to the  requirements  of this  Agreement.  The Trustee  shall notify the
Certificateholders  of any such documents which do not materially conform to the
requirements  of  this  Agreement  in the  event  that  the  Trustee,  after  so
requesting, does not receive satisfactorily corrected documents.

      The Trustee shall forward or cause to be forwarded in a timely fashion the
notices, reports and statements required to be forwarded by the Trustee pursuant
to Sections 4.03,  4.06,  7.03 and 10.01.  The Trustee shall furnish in a timely
fashion to the Master  Servicer  such  information  as the Master  Servicer  may
reasonably  request  from time to time for the Master  Servicer  to fulfill  its
duties as set forth in this Agreement.  The Trustee covenants and agrees that it
shall perform its obligations hereunder in a manner so as to maintain the status
of any portion of any REMIC formed under the Series  Supplement as a REMIC under
the REMIC Provisions and (subject to Section 10.01(f)) to prevent the imposition
of any federal, state or local income,  prohibited transaction,  contribution or
other tax on the Trust  Fund to the  extent  that  maintaining  such  status and
avoiding  such taxes are  reasonably  within the  control of the Trustee and are
reasonably within the scope of its duties under this Agreement.

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

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

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<PAGE>

      to the  Trustee by the Company or the Master  Servicer  and which on their
      face, do not contradict the requirements of this Agreement;

            (ii) The  Trustee  shall not be  personally  liable  for an error of
      judgment  made in good  faith  by a  Responsible  Officer  or  Responsible
      Officers  of the  Trustee,  unless it shall be proved that the Trustee was
      negligent in ascertaining the pertinent facts;

            (iii) The Trustee shall not be personally liable with respect to any
      action  taken,  suffered  or  omitted  to be taken by it in good  faith in
      accordance with the direction of  Certificateholders  of any Class holding
      Certificates  which  evidence,  as to  such  Class,  Percentage  Interests
      aggregating  not  less  than  25% as to the  time,  method  and  place  of
      conducting  any  proceeding  for any remedy  available to the Trustee,  or
      exercising  any trust or power  conferred  upon the  Trustee,  under  this
      Agreement;

            (iv) The Trustee shall not be charged with  knowledge of any default
      (other than a default in payment to the Trustee)  specified in clauses (i)
      and (ii) of Section 7.01 or an Event of Default under clauses (iii),  (iv)
      and (v) of  Section  7.01  unless a  Responsible  Officer  of the  Trustee
      assigned to and  working in the  Corporate  Trust  Office  obtains  actual
      knowledge of such failure or event or the Trustee  receives written notice
      of such  failure or event at its  Corporate  Trust  Office from the Master
      Servicer, the Company or any Certificateholder; and

            (v) Except to the extent  provided in Section  7.02, no provision in
      this  Agreement  shall require the Trustee to expend or risk its own funds
      (including,  without  limitation,  the making of any Advance) or otherwise
      incur any personal  financial  liability in the  performance of any of its
      duties as Trustee  hereunder,  or in the  exercise of any of its rights or
      powers,  if the Trustee shall have  reasonable  grounds for believing that
      repayment of funds or adequate indemnity against such risk or liability is
      not reasonably assured to it.

      (d) The Trustee  shall timely pay,  from its own funds,  the amount of any
and all federal,  state and local taxes  imposed on the Trust Fund or its assets
or transactions  including,  without  limitation,  (A) "prohibited  transaction"
penalty  taxes as defined in Section 860F of the Code,  if, when and as the same
shall be due and  payable,  (B) any tax on  contributions  to a REMIC  after the
Closing  Date  imposed  by  Section  860G(d) of the Code and (C) any tax on "net
income from foreclosure property" as defined in Section 860G(c) of the Code, but
only if such  taxes  arise out of a breach  by the  Trustee  of its  obligations
hereunder,  which breach  constitutes  negligence  or willful  misconduct of the
Trustee.

      Section 8.02. Certain Matters Affecting the Trustee.

      (a) Except as otherwise provided in Section 8.01:

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

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<PAGE>

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

            (iii) The Trustee  shall be under no  obligation  to exercise any of
      the  trusts or  powers  vested in it by this  Agreement  or to  institute,
      conduct or defend any  litigation  hereunder or in relation  hereto at the
      request, order or direction of any of the Certificateholders,  pursuant to
      the provisions of this  Agreement,  unless such  Certificateholders  shall
      have offered to the Trustee  reasonable  security or indemnity against the
      costs,  expenses and liabilities which may be incurred therein or thereby;
      nothing  contained  herein  shall,  however,  relieve  the  Trustee of the
      obligation, upon the occurrence of an Event of Default (which has not been
      cured or waived),  to exercise  such of the rights and powers vested in it
      by this  Agreement,  and to use the same degree of care and skill in their
      exercise  as  a  prudent   investor   would  exercise  or  use  under  the
      circumstances in the conduct of such investor's own affairs;

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

            (v) Prior to the  occurrence  of an Event of Default  hereunder  and
      after  the  curing  or waiver  of all  Events  of  Default  which may have
      occurred,  the Trustee shall not be bound to make any  investigation  into
      the facts or matters  stated in any  resolution,  certificate,  statement,
      instrument,  opinion,  report, notice, request,  consent, order, approval,
      bond or other paper or document,  unless  requested in writing so to do by
      Holders  of  Certificates  of any  Class  evidencing,  as to  such  Class,
      Percentage  Interests,  aggregating not less than 50%; provided,  however,
      that if the payment within a reasonable  time to the Trustee of the costs,
      expenses or liabilities  likely to be incurred by it in the making of such
      investigation is, in the opinion of the Trustee, not reasonably assured to
      the Trustee by the security afforded to it by the terms of this Agreement,
      the Trustee may  require  reasonable  indemnity  against  such  expense or
      liability as a condition to so proceeding. The reasonable expense of every
      such  examination  shall be paid by the  Master  Servicer,  if an Event of
      Default  shall have  occurred  and is  continuing,  and  otherwise  by the
      Certificateholder requesting the investigation;

            (vi) The Trustee  may execute any of the trusts or powers  hereunder
      or perform any duties hereunder either directly or by or through agents or
      attorneys; and

            (vii) To the extent  authorized  under the Code and the  regulations
      promulgated  thereunder,  each  Holder  of a  Class R  Certificate  hereby
      irrevocably appoints and authorizes the Trustee to be its attorney-in-fact
      for purposes of signing any Tax Returns  required to be filed on behalf of
      the Trust  Fund.  The  Trustee  shall sign on behalf of the Trust Fund and
      deliver to the Master Servicer in a timely manner any Tax Returns prepared
      by or on behalf of the Master  Servicer  that the  Trustee is  required to
      sign as determined by the Master Servicer pursuant to applicable  federal,
      state or local tax laws,

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<PAGE>

      provided that the Master  Servicer shall indemnify the Trustee for signing
      any such Tax Returns that contain errors or omissions.

      (b)  Following  the issuance of the  Certificates,  the Trustee  shall not
accept any  contribution  of assets to the Trust Fund unless (subject to Section
10.01(f)) it shall have obtained or been furnished with an Opinion of Counsel to
the effect  that such  contribution  will not (i) cause any portion of any REMIC
formed  under the  Series  Supplement  to fail to qualify as a REMIC at any time
that any Certificates are outstanding or (ii) cause the Trust Fund to be subject
to any federal tax as a result of such contribution (including the imposition of
any federal tax on "prohibited  transactions"  imposed under Section  860F(a) of
the Code).

      Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans.

      The  recitals  contained  herein and in the  Certificates  (other than the
execution of the  Certificates and relating to the acceptance and receipt of the
Mortgage  Loans) shall be taken as the  statements  of the Company or the Master
Servicer as the case may be, and the Trustee assumes no responsibility for their
correctness.  The  Trustee  makes  no  representations  as to  the  validity  or
sufficiency  of  this  Agreement  or  of  the  Certificates   (except  that  the
Certificates  shall be duly and  validly  executed  and  authenticated  by it as
Certificate  Registrar) or of any Mortgage Loan or related document,  or of MERS
or the MERS(R) System.  Except as otherwise  provided herein,  the Trustee shall
not be  accountable  for the use or  application  by the  Company  or the Master
Servicer of any of the Certificates or of the proceeds of such Certificates,  or
for the use or  application  of any  funds  paid to the  Company  or the  Master
Servicer in respect of the Mortgage  Loans or deposited in or withdrawn from the
Custodial  Account  or the  Certificate  Account  by the  Company  or the Master
Servicer.

      Section 8.04. Trustee May Own Certificates.

      The Trustee in its  individual or any other  capacity may become the owner
or pledgee  of  Certificates  with the same  rights it would have if it were not
Trustee.

      Section 8.05.  Master Servicer to Pay Trustee's Fees
                     and Expenses; Indemnification.

      (a) The Master Servicer covenants and agrees to pay to the Trustee and any
co-trustee  from  time to time,  and the  Trustee  and any  co-trustee  shall be
entitled  to,  reasonable  compensation  (which  shall  not  be  limited  by any
provision of law in regard to the compensation of a trustee of an express trust)
for all services  rendered by each of them in the execution of the trusts hereby
created  and in the  exercise  and  performance  of any of the powers and duties
hereunder of the Trustee and any co-trustee, and the Master Servicer will pay or
reimburse  the  Trustee  and any  co-trustee  upon  request  for all  reasonable
expenses,  disbursements  and  advances  incurred  or made by the Trustee or any
co-trustee in accordance with any of the provisions of this Agreement (including
the reasonable  compensation  and the expenses and  disbursements of its counsel
and of all persons not regularly in its employ, and the expenses incurred by the
Trustee or any  co-trustee in connection  with the  appointment  of an office or
agency  pursuant  to Section  8.12)  except any such  expense,  disbursement  or
advance as may arise from its negligence or bad faith.

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      (b) The Master  Servicer  agrees to indemnify the Trustee for, and to hold
the Trustee harmless  against,  any loss,  liability or expense incurred without
negligence or willful  misconduct on the Trustee's  part,  arising out of, or in
connection with, the acceptance and administration of the Trust Fund,  including
the costs  and  expenses  (including  reasonable  legal  fees and  expenses)  of
defending   itself  against  any  claim  in  connection  with  the  exercise  or
performance  of any of its  powers  or  duties  under  this  Agreement  and  the
Custodial  Agreement,  and the Master  Servicer  further agrees to indemnify the
Trustee for, and to hold the Trustee harmless  against,  any loss,  liability or
expense  arising out of, or in connection  with, the provisions set forth in the
second paragraph of Section 2.01(c) hereof, including,  without limitation,  all
costs,  liabilities and expenses (including  reasonable legal fees and expenses)
of investigating  and defending itself against any claim,  action or proceeding,
pending or threatened,  relating to the provisions of this  paragraph,  provided
that:

            (i) with respect to any such claim, the Trustee shall have given the
      Master  Servicer  written notice thereof  promptly after the Trustee shall
      have actual knowledge thereof;

            (ii) while  maintaining  control over its own  defense,  the Trustee
      shall  cooperate and consult  fully with the Master  Servicer in preparing
      such defense; and

            (iii)  notwithstanding  anything in this  Agreement to the contrary,
      the Master Servicer shall not be liable for settlement of any claim by the
      Trustee  entered  into  without the prior  consent of the Master  Servicer
      which consent shall not be unreasonably withheld.

No termination of this Agreement  shall affect the  obligations  created by this
Section  8.05(b) of the Master  Servicer  to  indemnify  the  Trustee  under the
conditions and to the extent set forth herein.

      Notwithstanding the foregoing,  the indemnification provided by the Master
Servicer  in this  Section  8.05(b)  shall  not be  available  (A) for any loss,
liability  or  expense  of the  Trustee,  including  the costs and  expenses  of
defending  itself  against any claim,  incurred in  connection  with any actions
taken by the Trustee at the direction of the Certificateholders  pursuant to the
terms of this  Agreement or (B) where the Trustee is required to  indemnify  the
Master Servicer pursuant to Section 12.05(a).

      Section 8.06. Eligibility Requirements for Trustee.

      The Trustee  hereunder  shall at all times be a corporation  or a national
banking  association  having its principal office in a state and city acceptable
to the Company and organized and doing  business under the laws of such state or
the United States of America,  authorized under such laws to exercise  corporate
trust  powers,  having a combined  capital and surplus of at least  $50,000,000,
subject to  supervision  or  examination  by federal or state  authority and the
short-term  rating of such  institution  shall be A-1 in the case of  Standard &
Poor's if Standard & Poor's is a Rating Agency.  If such corporation or national
banking association  publishes reports of condition at least annually,  pursuant
to  law  or to  the  requirements  of the  aforesaid  supervising  or  examining
authority,  then for the  purposes  of this  Section  the  combined  capital and
surplus of

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such  corporation  shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so  published.  In case at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section,  the Trustee shall resign immediately in the manner and with the effect
specified in Section 8.07.

      Section 8.07. Resignation and Removal of the Trustee.

      (a) The Trustee may at any time resign and be  discharged  from the trusts
hereby created by giving  written notice thereof to the Company.  Upon receiving
such notice of  resignation,  the  Company  shall  promptly  appoint a successor
trustee by written instrument,  in duplicate, one copy of which instrument shall
be delivered to the resigning Trustee and one copy to the successor trustee.  If
no successor trustee shall have been so appointed and have accepted  appointment
within 30 days after the giving of such  notice of  resignation,  the  resigning
Trustee may petition any court of competent  jurisdiction for the appointment of
a successor trustee.

      (b) If at any time the Trustee  shall  cease to be eligible in  accordance
with the  provisions  of  Section  8.06 and shall fail to resign  after  written
request  therefor by the  Company,  or if at any time the Trustee  shall  become
incapable of acting, or shall be adjudged  bankrupt or insolvent,  or a receiver
of the Trustee or of its  property  shall be  appointed,  or any public  officer
shall take  charge or control of the  Trustee or of its  property or affairs for
the purpose of rehabilitation, conservation or liquidation, then the Company may
remove the Trustee and appoint a  successor  trustee by written  instrument,  in
duplicate,  one copy of which  instrument  shall be  delivered to the Trustee so
removed and one copy to the successor  trustee.  In addition,  in the event that
the Company determines that the Trustee has failed (i) to distribute or cause to
be distributed to the  Certificateholders  any amount required to be distributed
hereunder, if such amount is held by the Trustee or its Paying Agent (other than
the Master  Servicer  or the  Company)  for  distribution  or (ii) to  otherwise
observe or perform in any material  respect any of its covenants,  agreements or
obligations  hereunder,  and such failure shall continue unremedied for a period
of 5 days (in respect of clause (i) above) or 30 days (in respect of clause (ii)
above other than any failure to comply with the  provisions  of Article  XII, in
which  case no notice or grace  period  shall be  applicable)  after the date on
which written notice of such failure, requiring that the same be remedied, shall
have been given to the Trustee by the  Company,  then the Company may remove the
Trustee and  appoint a  successor  trustee by written  instrument  delivered  as
provided in the preceding  sentence.  In connection  with the  appointment  of a
successor trustee pursuant to the preceding  sentence,  the Company shall, on or
before the date on which any such  appointment  becomes  effective,  obtain from
each  Rating  Agency  written  confirmation  that  the  appointment  of any such
successor  trustee will not result in the  reduction of the ratings on any class
of the Certificates  below the lesser of the then current or original ratings on
such Certificates.

      (c) The  Holders of  Certificates  entitled  to at least 51% of the Voting
Rights may at any time remove the  Trustee  and  appoint a successor  trustee by
written  instrument or  instruments,  in  triplicate,  signed by such Holders or
their  attorneys-in-fact duly authorized,  one complete set of which instruments
shall be delivered  to the  Company,  one complete set to the Trustee so removed
and one complete set to the successor so appointed.

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      (d) Any  resignation  or  removal  of the  Trustee  and  appointment  of a
successor trustee pursuant to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor trustee as provided in
Section 8.08.

      Section 8.08. Successor Trustee.

      (a) Any  successor  trustee  appointed  as provided in Section  8.07 shall
execute,  acknowledge and deliver to the Company and to its predecessor  trustee
an  instrument   accepting  such  appointment   hereunder,   and  thereupon  the
resignation  or removal of the  predecessor  trustee shall become  effective and
such  successor  trustee  shall become  effective  and such  successor  trustee,
without any further act, deed or conveyance,  shall become fully vested with all
the rights,  powers, duties and obligations of its predecessor  hereunder,  with
the like  effect as if  originally  named as  trustee  herein.  The  predecessor
trustee shall deliver to the successor  trustee all Custodial  Files and related
documents and statements held by it hereunder (other than any Custodial Files at
the time held by a  Custodian,  which  shall  become the agent of any  successor
trustee  hereunder),  and the Company,  the Master  Servicer and the predecessor
trustee shall execute and deliver such  instruments  and do such other things as
may  reasonably be required for more fully and certainly  vesting and confirming
in the successor trustee all such rights, powers, duties and obligations.

      (b) No  successor  trustee  shall accept  appointment  as provided in this
Section unless at the time of such  acceptance  such successor  trustee shall be
eligible under the provisions of Section 8.06.

      (c) Upon  acceptance of appointment by a successor  trustee as provided in
this Section,  the Company  shall mail notice of the  succession of such trustee
hereunder  to all Holders of  Certificates  at their  addresses  as shown in the
Certificate  Register.  If the Company  fails to mail such notice within 10 days
after acceptance of appointment by the successor trustee,  the successor trustee
shall cause such notice to be mailed at the expense of the Company.

      Section 8.09. Merger or Consolidation of Trustee.

      Any corporation or national banking association into which the Trustee may
be merged or converted or with which it may be  consolidated  or any corporation
or  national  banking  association  resulting  from any  merger,  conversion  or
consolidation  to which the  Trustee  shall be a party,  or any  corporation  or
national banking association succeeding to the business of the Trustee, shall be
the successor of the Trustee  hereunder,  provided such  corporation or national
banking  association  shall be eligible  under the  provisions  of Section 8.06,
without the  execution  or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding.  The
Trustee  shall  mail  notice  of  any  such  merger  or   consolidation  to  the
Certificateholders at their address as shown in the Certificate Register.

      Section 8.10. Appointment of Co-Trustee or Separate Trustee.

      (a)  Notwithstanding  any other  provisions  hereof,  at any time, for the
purpose of meeting any legal  requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located,  the
Master  Servicer and the Trustee  acting  jointly shall have the power and shall
execute and deliver all instruments to appoint one or

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more  Persons  approved  by the  Trustee to act as  co-trustee  or  co-trustees,
jointly with the Trustee,  or separate trustee or separate  trustees,  of all or
any part of the  Trust  Fund,  and to vest in such  Person or  Persons,  in such
capacity, such title to the Trust Fund, or any part thereof, and, subject to the
other provisions of this Section 8.10, such powers, duties, obligations,  rights
and trusts as the Master  Servicer  and the Trustee may  consider  necessary  or
desirable.  If the Master  Servicer  shall not have  joined in such  appointment
within 15 days  after  the  receipt  by it of a request  so to do, or in case an
Event of Default shall have occurred and be continuing,  the Trustee alone shall
have the power to make such  appointment.  No  co-trustee  or  separate  trustee
hereunder  shall be  required  to meet the terms of  eligibility  as a successor
trustee under Section 8.06 hereunder and no notice to Holders of Certificates of
the appointment of co-trustee(s) or separate  trustee(s) shall be required under
Section 8.08 hereof.

      (b) In the case of any  appointment  of a co-trustee  or separate  trustee
pursuant  to this  Section  8.10 all  rights,  powers,  duties  and  obligations
conferred  or imposed  upon the Trustee  shall be  conferred or imposed upon and
exercised or performed by the Trustee,  and such separate  trustee or co-trustee
jointly,  except to the extent that under any law of any  jurisdiction  in which
any particular act or acts are to be performed  (whether as Trustee hereunder or
as successor to the Master Servicer hereunder), the Trustee shall be incompetent
or unqualified to perform such act or acts, in which event such rights,  powers,
duties and obligations  (including the holding of title to the Trust Fund or any
portion  thereof in any such  jurisdiction)  shall be exercised and performed by
such separate trustee or co-trustee at the direction of the Trustee.

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

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

      Section 8.11. Appointment of the Custodian.

      The Trustee may, with the consent of the Master  Servicer and the Company,
or shall,  at the  direction  of the  Company and the Master  Servicer,  appoint
custodians  who are not  Affiliates of the Company,  the Master  Servicer or any
Seller to hold all or a portion of the Custodial Files as agent for the Trustee,
by entering into a Custodial  Agreement.  Subject to Article  VIII,  the Trustee
agrees to comply with the terms of each Custodial  Agreement with respect to the
Custodial  Files and to enforce  the terms and  provisions  thereof  against the
related custodian for

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the benefit of the  Certificateholders.  Each  custodian  shall be a  depository
institution  subject to supervision by federal or state authority,  shall have a
combined  capital and surplus of at least  $15,000,000 and shall be qualified to
do business  in the  jurisdiction  in which it holds any  Custodial  File.  Each
Custodial Agreement, with respect to the Custodial Files, may be amended only as
provided in Section 11.01.  The Trustee shall notify the  Certificateholders  of
the appointment of any custodian  (other than the custodian  appointed as of the
Closing Date) pursuant to this Section 8.11.

      Section 8.12. Appointment of Office or Agency.

      The Trustee will  maintain an office or agency in the United States at the
address  designated in Section 11.05 of the Series Supplement where Certificates
may be surrendered for  registration  of transfer or exchange.  The Trustee will
maintain  an  office  at the  address  stated  in  Section  11.05 of the  Series
Supplement  where  notices and demands to or upon the Trustee in respect of this
Agreement may be served.

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                                   Article IX

              TERMINATION OR OPTIONAL PURCHASE OF ALL CERTIFICATES

      Section   9.01.   Optional   Purchase  by  the  Master   Servicer  of  All
                        Certificates;  Termination  Upon  Purchase by the Master
                        Servicer or Liquidation of All Mortgage Loans.

      (a)   Subject  to   Section   9.02,   the   respective   obligations   and
responsibilities  of the Company,  the Master  Servicer and the Trustee  created
hereby in respect of the Certificates  (other than the obligation of the Trustee
to make certain payments after the Final Distribution Date to Certificateholders
and the  obligation of the Company to send certain  notices as  hereinafter  set
forth) shall  terminate upon the last action required to be taken by the Trustee
on the Final Distribution Date pursuant to this Article IX following the earlier
of:

            (i) the  later of the final  payment  or other  liquidation  (or any
      Advance with respect  thereto) of the last Mortgage Loan  remaining in the
      Trust Fund or the disposition of all property acquired upon foreclosure or
      deed in lieu of foreclosure of any Mortgage Loan, or

            (ii) the purchase by the Master  Servicer of all Mortgage  Loans and
      all  property  acquired in respect of any Mortgage  Loan  remaining in the
      Trust  Fund at a price  equal to 100% of the unpaid  principal  balance of
      each Mortgage  Loan or, if less than such unpaid  principal  balance,  the
      fair market value of the related underlying property of such Mortgage Loan
      with respect to Mortgage Loans as to which title has been acquired if such
      fair market value is less than such unpaid  principal  balance (net of any
      unreimbursed  Advances attributable to principal) on the day of repurchase
      plus accrued  interest  thereon at the Net Mortgage  Rate (or Modified Net
      Mortgage  Rate in the case of any  Modified  Mortgage  Loan)  to,  but not
      including,  the first day of the month in which such  repurchase  price is
      distributed,  provided,  however, that in no event shall the trust created
      hereby  continue  beyond the  expiration of 21 years from the death of the
      last survivor of the descendants of Joseph P. Kennedy, the late ambassador
      of the United States to the Court of St. James,  living on the date hereof
      and  provided  further  that the  purchase  price set forth above shall be
      increased as is necessary,  as determined by the Master Servicer, to avoid
      disqualification  of any  portion  of any REMIC  formed  under the  Series
      Supplement  as a REMIC.  The  purchase  price paid by the Master  Servicer
      shall also include any amounts owed by Residential Funding pursuant to the
      last paragraph of Section 4 of the Assignment  Agreement in respect of any
      liability,  penalty  or  expense  that  resulted  from  a  breach  of  the
      Compliance  With Laws  Representation,  that remain  unpaid on the date of
      such purchase.

      The right of the Master  Servicer to purchase  all the assets of the Trust
Fund pursuant to clause (ii) above is conditioned upon the Pool Stated Principal
Balance  as  of  the  Final   Distribution  Date,  prior  to  giving  effect  to
distributions to be made on such Distribution  Date, being less than ten percent
of the Cut-off Date Principal Balance of the Mortgage Loans.

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<PAGE>

      If such right is exercised  by the Master  Servicer,  the Master  Servicer
shall be deemed to have been reimbursed for the full amount of any  unreimbursed
Advances theretofore made by it with respect to the Mortgage Loans. In addition,
the Master Servicer shall provide to the Trustee the  certification  required by
Section 3.15 and the Trustee and the Custodian shall, promptly following payment
of the  purchase  price,  release to the Master  Servicer  the  Custodial  Files
pertaining to the Mortgage Loans being purchased.

      In addition to the foregoing,  on any Distribution  Date on which the Pool
Stated Principal Balance,  prior to giving effect to distributions to be made on
such  Distribution  Date, is less than ten percent of the Cut-off Date Principal
Balance of the Mortgage Loans,  the Master Servicer shall have the right, at its
option, to purchase the Certificates in whole, but not in part, at a price equal
to the outstanding  Certificate  Principal Balance of such Certificates plus the
sum of Accrued  Certificate  Interest  thereon for the related  Interest Accrual
Period and any previously  unpaid Accrued  Certificate  Interest.  If the Master
Servicer  exercises  this right to purchase the  outstanding  Certificates,  the
Master  Servicer  will  promptly   terminate  the  respective   obligations  and
responsibilities  created hereby in respect of the Certificates pursuant to this
Article IX.

      (b) The  Master  Servicer  shall give the  Trustee  not less than 40 days'
prior notice of the Distribution  Date on which the Master Servicer  anticipates
that the final  distribution  will be made to  Certificateholders  (whether as a
result of the  exercise  by the Master  Servicer  of its right to  purchase  the
assets  of the  Trust  Fund  or  otherwise)  or on  which  the  Master  Servicer
anticipates that the Certificates will be purchased (as a result of the exercise
by the Master Servicer to purchase the outstanding Certificates).  Notice of any
termination specifying the anticipated Final Distribution Date (which shall be a
date  that   would   otherwise   be  a   Distribution   Date)   upon  which  the
Certificateholders  may  surrender  their  Certificates  to the  Trustee  (if so
required  by the  terms  hereof)  for  payment  of the  final  distribution  and
cancellation  or  notice  of  any  purchase  of  the  outstanding  Certificates,
specifying  the  Distribution  Date upon which the Holders may  surrender  their
Certificates  to the Trustee for payment,  shall be given promptly by the Master
Servicer (if it is exercising its right to purchase the assets of the Trust Fund
or to purchase the  outstanding  Certificates),  or by the Trustee (in any other
case) by letter.  Such notice shall be prepared by the Master Servicer (if it is
exercising its right to purchase the assets of the Trust Fund or to purchase the
outstanding  Certificates),  or by the Trustee (in any other case) and mailed by
the  Trustee to the  Certificateholders  not  earlier  than the 15th day and not
later  than the 25th day of the month  next  preceding  the month of such  final
distribution specifying:

            (i) the anticipated Final Distribution Date upon which final payment
      of the  Certificates  is  anticipated  to be made  upon  presentation  and
      surrender of  Certificates  at the office or agency of the Trustee therein
      designated  where  required  pursuant to this Agreement or, in the case of
      the purchase by the Master Servicer of the outstanding  Certificates,  the
      Distribution Date on which such purchase is to be made,

            (ii) the  amount of any such  final  payment,  or in the case of the
      purchase of the  outstanding  Certificates,  the purchase price, in either
      case, if known, and

            (iii) that the Record Date otherwise applicable to such Distribution
      Date is not applicable, and in the case of the Senior Certificates,  or in
      the case of all of the

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      Certificates in connection with the exercise by the Master Servicer of its
      right to purchase  the  Certificates,  that payment will be made only upon
      presentation  and surrender of the Certificates at the office or agency of
      the Trustee therein specified.

If the Master  Servicer is  obligated  to give notice to  Certificateholders  as
aforesaid,  it shall give such notice to the  Certificate  Registrar at the time
such  notice is given to  Certificateholders  and,  if the  Master  Servicer  is
exercising its rights to purchase the  outstanding  Certificates,  it shall give
such  notice  to each  Rating  Agency  at the  time  such  notice  is  given  to
Certificateholders.  As a result of the  exercise by the Master  Servicer of its
right to  purchase  the  assets of the Trust  Fund,  the Master  Servicer  shall
deposit  in the  Certificate  Account,  before  the Final  Distribution  Date in
immediately available funds an amount equal to the purchase price for the assets
of the Trust Fund,  computed as provided  above.  As a result of the exercise by
the Master Servicer of its right to purchase the outstanding  Certificates,  the
Master Servicer shall deposit in an Eligible Account,  established by the Master
Servicer on behalf of the Trustee and separate from the  Certificate  Account in
the name of the Trustee in trust for the registered holders of the Certificates,
before the  Distribution  Date on which such purchase is to occur in immediately
available  funds an amount  equal to the  purchase  price for the  Certificates,
computed as above  provided,  and provide notice of such deposit to the Trustee.
The Trustee will withdraw  from such account the amount  specified in subsection
(c) below.

      (c)  In the  case  of  the  Senior  Certificates,  upon  presentation  and
surrender of the Certificates by the Certificateholders thereof, and in the case
of the Class M and Class B Certificates,  upon presentation and surrender of the
Certificates by the  Certificateholders  thereof in connection with the exercise
by the Master Servicer of its right to purchase the Certificates,  and otherwise
in  accordance  with  Section  4.01(a),  the  Trustee  shall  distribute  to the
Certificateholders  (i) the amount otherwise  distributable on such Distribution
Date, if not in connection with the Master Servicer's election to repurchase the
assets of the Trust Fund or the outstanding Certificates,  or (ii) if the Master
Servicer  elected  to so  repurchase  the  assets  of  the  Trust  Fund  or  the
outstanding  Certificates,  an amount determined as follows: (A) with respect to
each Certificate the outstanding  Certificate  Principal  Balance thereof,  plus
Accrued Certificate Interest for the related Interest Accrual Period thereon and
any previously unpaid Accrued Certificate Interest,  subject to the priority set
forth in Section 4.02(a), and (B) with respect to the Class R Certificates,  any
excess of the amounts available for distribution (including the repurchase price
specified  in clause  (ii) of  subsection  (a) of this  Section)  over the total
amount distributed under the immediately  preceding clause (A).  Notwithstanding
the reduction of the Certificate  Principal  Balance of any Class of Subordinate
Certificates  to zero,  such  Class  will be  outstanding  hereunder  until  the
termination of the respective  obligations and  responsibilities of the Company,
the Master Servicer and the Trustee hereunder in accordance with Article IX.

      (d) If any  Certificateholders  shall not surrender their Certificates for
final payment and cancellation on or before the Final  Distribution  Date (if so
required by the terms hereof), the Trustee shall on such date cause all funds in
the   Certificate   Account   not   distributed   in   final   distribution   to
Certificateholders  to be  withdrawn  therefrom  and  credited to the  remaining
Certificateholders by depositing such funds in a separate escrow account,  which
may be non-interest bearing, for the benefit of such Certificateholders, and the
Master  Servicer (if it exercised  its right to purchase the assets of the Trust
Fund),  or the Trustee (in any other case) shall give a second written notice to
the remaining Certificateholders to surrender their Certificates for

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cancellation and receive the final distribution with respect thereto.  If within
six  months  after  the  second  notice  any  Certificate  shall  not have  been
surrendered  for  cancellation,  the  Trustee  shall take  appropriate  steps as
directed  by the Master  Servicer to contact  the  remaining  Certificateholders
concerning   surrender  of  their  Certificates.   The  costs  and  expenses  of
maintaining  the escrow  account and of contacting  Certificateholders  shall be
paid out of the assets which remain in the escrow account. If within nine months
after the second notice any  Certificates  shall not have been  surrendered  for
cancellation,  the  Trustee  shall  pay  to  the  Master  Servicer  all  amounts
distributable  to the holders thereof and the Master  Servicer shall  thereafter
hold such amounts until distributed to such Holders. No interest shall accrue or
be payable to any  Certificateholder on any amount held in the escrow account or
by the  Master  Servicer  as a result  of such  Certificateholder's  failure  to
surrender its  Certificate(s)  for final payment thereof in accordance with this
Section 9.01.

      (e) If any  Certificateholders  do not surrender their  Certificates on or
before the Distribution Date on which a purchase of the outstanding Certificates
is to be made, the Trustee shall on such date cause all funds in the Certificate
Account  deposited therein by the Master Servicer pursuant to Section 9.01(b) to
be withdrawn therefrom and deposited in a separate escrow account,  which may be
non-interest bearing, for the benefit of such Certificateholders, and the Master
Servicer  shall  give a second  written  notice  to such  Certificateholders  to
surrender  their  Certificates  for payment of the purchase price  therefor.  If
within six months after the second  notice any  Certificate  shall not have been
surrendered  for  cancellation,  the  Trustee  shall take  appropriate  steps as
directed by the Master  Servicer  to contact  the  Holders of such  Certificates
concerning   surrender  of  their  Certificates.   The  costs  and  expenses  of
maintaining  the escrow  account and of contacting  Certificateholders  shall be
paid out of the assets which remain in the escrow account. If within nine months
after the second notice any  Certificates  shall not have been  surrendered  for
cancellation  in accordance with this Section 9.01, the Trustee shall pay to the
Master Servicer all amounts  distributable to the Holders thereof and the Master
Servicer shall  thereafter hold such amounts until  distributed to such Holders.
No interest  shall accrue or be payable to any  Certificateholder  on any amount
held in the  escrow  account  or by the  Master  Servicer  as a  result  of such
Certificateholder's  failure to  surrender  its  Certificate(s)  for  payment in
accordance  with this Section 9.01. Any  Certificate  that is not surrendered on
the Distribution  Date on which a purchase  pursuant to this Section 9.01 occurs
as  provided  above will be deemed to have been  purchased  and the Holder as of
such date will  have no  rights  with  respect  thereto  except to  receive  the
purchase price therefor minus any costs and expenses associated with such escrow
account and notices allocated  thereto.  Any Certificates so purchased or deemed
to have been  purchased  on such  Distribution  Date  shall  remain  outstanding
hereunder  until the Master  Servicer has terminated the respective  obligations
and responsibilities  created hereby in respect of the Certificates  pursuant to
this  Article  IX.  The Master  Servicer  shall be for all  purposes  the Holder
thereof as of such date.

      Section 9.02. Additional Termination Requirements.

      (a) Each  REMIC that  comprises  the Trust  Fund  shall be  terminated  in
accordance  with the  following  additional  requirements,  unless  (subject  to
Section  10.01(f)) the Trustee and the Master  Servicer have received an Opinion
of Counsel  (which Opinion of Counsel shall not be an expense of the Trustee) to
the effect that the  failure of each such REMIC to comply with the  requirements
of this Section 9.02 will not (i) result in the  imposition on the Trust Fund of
taxes

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<PAGE>

on "prohibited transactions," as described in Section 860F of the Code, or
(ii)  cause any such  REMIC to fail to  qualify  as a REMIC at any time that any
Certificate is outstanding:

            (i) The Master Servicer shall establish a 90-day  liquidation period
      for each  such  REMIC  and  specify  the  first  day of such  period  in a
      statement  attached  to the Trust  Fund's  final Tax  Return  pursuant  to
      Treasury  regulations  Section  1.860F-1.  The Master  Servicer also shall
      satisfy all of the  requirements  of a qualified  liquidation  for a REMIC
      under Section 860F of the Code and regulations thereunder;

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

            (iii) If the Master  Servicer or the Company is exercising its right
      to  purchase  the assets of the Trust  Fund,  the Master  Servicer  shall,
      during  the  90-day  liquidation  period  and at or  prior  to  the  Final
      Distribution Date, purchase all of the assets of the Trust Fund for cash.

      (b) Each  Holder  of a  Certificate  and the  Trustee  hereby  irrevocably
approves  and appoints the Master  Servicer as its  attorney-in-fact  to adopt a
plan of complete  liquidation for each REMIC at the expense of the Trust Fund in
accordance with the terms and conditions of this Agreement.

      Section 9.03. Termination of Multiple REMICs.

      If the REMIC Administrator makes two or more separate REMIC elections, the
applicable  REMIC shall be terminated  on the earlier of the Final  Distribution
Date and the date on which it is deemed to receive the last deemed distributions
on the related  Uncertificated REMIC Regular Interests and the last distribution
due on the Certificates is made.

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                                   Article X

                                REMIC PROVISIONS

      Section 10.01. REMIC Administration.

      (a) The REMIC Administrator shall make an election to treat the Trust Fund
as one or more REMICs under the Code and, if necessary,  under  applicable state
law.  The assets of each such REMIC will be set forth in the Series  Supplement.
Such  election  will be made on Form 1066 or other  appropriate  federal  tax or
information return (including Form 8811) or any appropriate state return for the
taxable  year  ending  on the  last  day of  the  calendar  year  in  which  the
Certificates  are issued.  For the purposes of each REMIC election in respect of
the Trust Fund,  Certificates  and  interests to be  designated  as the "regular
interests"  and the sole class of "residual  interests" in the REMIC will be set
forth in Section 10.03 of the Series Supplement. The REMIC Administrator and the
Trustee shall not permit the creation of any "interests"  (within the meaning of
Section  860G of the Code) in any REMIC  elected  in  respect  of the Trust Fund
other than the "regular interests" and "residual interests" so designated.

      (b) The Closing  Date is hereby  designated  as the  "startup  day" of the
Trust Fund within the meaning of Section 860G(a)(9) of the Code.

      (c) The REMIC Administrator shall hold a Class R Certificate  representing
a 0.01% Percentage  Interest each Class of the Class R Certificates and shall be
designated as "the tax matters  person" with respect to each REMIC in the manner
provided under Treasury regulations section 1.860F-4(d) and Treasury regulations
section 301.6231(a)(7)-1.  The REMIC Administrator, as tax matters person, shall
(i) act on behalf of each REMIC in  relation  to any tax  matter or  controversy
involving the Trust Fund and (ii) represent the Trust Fund in any administrative
or judicial  proceeding  relating to an examination or audit by any governmental
taxing authority with respect  thereto.  The legal expenses,  including  without
limitation attorneys' or accountants' fees, and costs of any such proceeding and
any liability  resulting  therefrom  shall be expenses of the Trust Fund and the
REMIC Administrator  shall be entitled to reimbursement  therefor out of amounts
attributable  to the  Mortgage  Loans on  deposit  in the  Custodial  Account as
provided by Section  3.10 unless such legal  expenses  and costs are incurred by
reason  of the REMIC  Administrator's  willful  misfeasance,  bad faith or gross
negligence.  If  the  REMIC  Administrator  is no  longer  the  Master  Servicer
hereunder,  at its option the REMIC  Administrator  may  continue  its duties as
REMIC  Administrator  and shall be paid  reasonable  compensation  not to exceed
$3,000 per year by any successor Master Servicer  hereunder for so acting as the
REMIC Administrator.

      (d) The REMIC  Administrator  shall prepare or cause to be prepared all of
the Tax Returns  that it  determines  are  required  with  respect to each REMIC
created hereunder and deliver such Tax Returns in a timely manner to the Trustee
and the  Trustee  shall sign and file such Tax Returns in a timely  manner.  The
expenses of  preparing  such returns  shall be borne by the REMIC  Administrator
without any right of reimbursement  therefor.  The REMIC Administrator agrees to
indemnify  and hold  harmless  the Trustee  with respect to any tax or liability
arising  from the  Trustee's  signing  of Tax  Returns  that  contain  errors or
omissions.  The Trustee and Master  Servicer  shall  promptly  provide the REMIC
Administrator with such

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<PAGE>

information  as the REMIC  Administrator  may from time to time  request for the
purpose of enabling the REMIC Administrator to prepare Tax Returns.

      (e) The REMIC Administrator shall provide (i) to any Transferor of a Class
R Certificate  such  information as is necessary for the  application of any tax
relating  to the  transfer of a Class R  Certificate  to any Person who is not a
Permitted Transferee,  (ii) to the Trustee, and the Trustee shall forward to the
Certificateholders,  such  information or reports as are required by the Code or
the REMIC  Provisions  including  reports  relating to interest,  original issue
discount and market  discount or premium (using the Prepayment  Assumption)  and
(iii) to the Internal  Revenue  Service the name,  title,  address and telephone
number of the person who will serve as the representative of each REMIC.

      (f) The  Master  Servicer  and the  REMIC  Administrator  shall  take such
actions and shall cause each REMIC created hereunder to take such actions as are
reasonably within the Master Servicer's or the REMIC Administrator's control and
the scope of its duties more specifically set forth herein as shall be necessary
or  desirable  to  maintain  the status of each REMIC as a REMIC under the REMIC
Provisions  (and the  Trustee  shall  assist the Master  Servicer  and the REMIC
Administrator, to the extent reasonably requested by the Master Servicer and the
REMIC  Administrator to do so). The Master Servicer and the REMIC  Administrator
shall not knowingly or  intentionally  take any action,  cause the Trust Fund to
take any  action  or fail to take (or fail to  cause  to be  taken)  any  action
reasonably within their respective control that, under the REMIC Provisions,  if
taken or not taken,  as the case may be,  could (i)  endanger  the status of any
portion  of any REMIC  formed  under the  Series  Supplement  as a REMIC or (ii)
result in the imposition of a tax upon any such REMIC (including but not limited
to the tax on prohibited  transactions  as defined in Section  860F(a)(2) of the
Code and the tax on contributions to a REMIC set forth in Section 860G(d) of the
Code)  (either  such  event,  in the  absence  of an  Opinion  of Counsel or the
indemnification  referred to in this sentence,  an "Adverse REMIC Event") unless
the Master Servicer or the REMIC Administrator,  as applicable,  has received an
Opinion of Counsel (at the expense of the party  seeking to take such action or,
if such party fails to pay such  expense,  and the Master  Servicer or the REMIC
Administrator, as applicable,  determines that taking such action is in the best
interest  of the Trust Fund and the  Certificateholders,  at the  expense of the
Trust  Fund,  but in no event at the expense of the Master  Servicer,  the REMIC
Administrator  or the Trustee) to the effect that the  contemplated  action will
not,  with respect to each REMIC  created  hereunder,  endanger  such status or,
unless the Master  Servicer,  the REMIC  Administrator  or both, as  applicable,
determine in its or their sole  discretion  to indemnify  the Trust Fund against
the imposition of such a tax,  result in the imposition of such a tax.  Wherever
in this Agreement a  contemplated  action may not be taken because the timing of
such action might result in the  imposition  of a tax on the Trust Fund,  or may
only be taken  pursuant  to an  Opinion of Counsel  that such  action  would not
impose a tax on the Trust Fund,  such action may  nonetheless  be taken provided
that the  indemnity  given in the  preceding  sentence with respect to any taxes
that  might be  imposed  on the  Trust  Fund has been  given  and that all other
preconditions  to the taking of such  action  have been  satisfied.  The Trustee
shall not take or fail to take any action (whether or not authorized  hereunder)
as to which the Master Servicer or the REMIC Administrator,  as applicable,  has
advised it in writing  that it has  received an Opinion of Counsel to the effect
that an Adverse  REMIC  Event  could  occur  with  respect  to such  action.  In
addition, prior to taking any action with respect to any REMIC created hereunder
or any  related  assets  thereof,  or causing any such REMIC to take any action,
which is

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<PAGE>

not  expressly  permitted  under the terms of this  Agreement,  the Trustee will
consult with the Master Servicer or the REMIC Administrator,  as applicable,  or
its  designee,  in writing,  with  respect to whether such action could cause an
Adverse  REMIC Event to occur with  respect to any such  REMIC,  and the Trustee
shall not take any such  action or cause any such REMIC to take any such  action
as to which the Master Servicer or the REMIC Administrator,  as applicable,  has
advised it in writing  that an  Adverse  REMIC  Event  could  occur.  The Master
Servicer or the REMIC Administrator,  as applicable, may consult with counsel to
make  such  written  advice,  and the cost of same  shall be borne by the  party
seeking to take the action not expressly permitted by this Agreement,  but in no
event at the expense of the Master Servicer or the REMIC  Administrator.  At all
times as may be required  by the Code,  the Master  Servicer  will to the extent
within its  control  and the scope of its  duties  more  specifically  set forth
herein, maintain substantially all of the assets of each REMIC created hereunder
as  "qualified  mortgages"  as  defined in  Section  860G(a)(3)  of the Code and
"permitted investments" as defined in Section 860G(a)(5) of the Code.

      (g) In the event that any tax is imposed on "prohibited  transactions"  of
any REMIC  created  hereunder as defined in Section  860F(a)(2)  of the Code, on
"net income from  foreclosure  property" of any such REMIC as defined in Section
860G(c) of the Code,  on any  contributions  to any such REMIC after the Startup
Day  therefor  pursuant  to  Section  860G(d)  of the Code,  or any other tax is
imposed  by the Code or any  applicable  provisions  of state or local tax laws,
such tax shall be charged (i) to the Master Servicer,  if such tax arises out of
or results from a breach by the Master Servicer of any of its obligations  under
this Agreement or the Master Servicer has in its sole  discretion  determined to
indemnify  the Trust Fund  against such tax,  (ii) to the  Trustee,  if such tax
arises out of or results from a breach by the Trustee of any of its  obligations
under  this  Article  X, or (iii)  otherwise  against  amounts on deposit in the
Custodial  Account as provided by Section 3.10 and on the  Distribution  Date(s)
following such  reimbursement  the aggregate of such taxes shall be allocated in
reduction of the Accrued Certificate  Interest on each Class entitled thereto in
the same manner as if such taxes constituted a Prepayment Interest Shortfall.

      (h) The  Trustee and the Master  Servicer  shall,  for federal  income tax
purposes,  maintain  books  and  records  with  respect  to each  REMIC  created
hereunder  on a calendar  year and on an accrual  basis or as  otherwise  may be
required by the REMIC Provisions.

      (i) Following the Startup Day, neither the Master Servicer nor the Trustee
shall accept any  contributions of assets to any REMIC created  hereunder unless
(subject to Section  10.01(f))  the Master  Servicer and the Trustee  shall have
received an Opinion of Counsel (at the expense of the party seeking to make such
contribution) to the effect that the inclusion of such assets in such REMIC will
not  cause  the  REMIC  to fail to  qualify  as a REMIC  at any  time  that  any
Certificates  are  outstanding  or subject  the REMIC to any tax under the REMIC
Provisions or other  applicable  provisions  of federal,  state and local law or
ordinances.

      (j) Neither the Master  Servicer nor the Trustee shall (subject to Section
10.01(f)) enter into any  arrangement by which any REMIC created  hereunder will
receive a fee or other  compensation  for  services nor permit any such REMIC to
receive any income from assets other than  "qualified  mortgages"  as defined in
Section 860G(a)(3) of the Code or "permitted  investments" as defined in Section
860G(a)(5) of the Code.

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      (k) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
Regulations,  the  "latest  possible  maturity  date" by which  the  Certificate
Principal  Balance of each Class of  Certificates  (other than the Interest Only
Certificates)  representing a regular  interest in the applicable  REMIC and the
Uncertificated  Principal Balance of each Uncertificated  REMIC Regular Interest
(other than each  Uncertificated  REMIC Regular Interest  represented by a Class
A-V  Certificate,  if any) and the rights to the Interest Only  Certificates and
Uncertificated  REMIC Regular  Interest  represented by a Class A-V  Certificate
would be  reduced to zero is the  Maturity  Date for each such  Certificate  and
Interest.

      (l) Within 30 days after the Closing Date, the REMIC  Administrator  shall
prepare  and file with the  Internal  Revenue  Service  Form 8811,  "Information
Return for Real  Estate  Mortgage  Investment  Conduits  (REMIC)  and Issuers of
Collateralized Debt Obligations" for each REMIC created hereunder.

      (m) Neither the Trustee nor the Master Servicer shall sell,  dispose of or
substitute  for any of the Mortgage  Loans  (except in  connection  with (i) the
default,  imminent default or foreclosure of a Mortgage Loan,  including but not
limited to, the acquisition or sale of a Mortgaged  Property acquired by deed in
lieu of foreclosure,  (ii) the bankruptcy of any REMIC created hereunder,  (iii)
the  termination  of any such REMIC  pursuant to Article IX of this Agreement or
(iv) a  purchase  of  Mortgage  Loans  pursuant  to  Article  II or III of  this
Agreement) nor acquire any assets for any such REMIC, nor sell or dispose of any
investments  in the Custodial  Account or the  Certificate  Account for gain nor
accept any  contributions to any such REMIC after the Closing Date unless it has
received  an Opinion of Counsel  that such sale,  disposition,  substitution  or
acquisition will not (a) affect adversely the status of such REMIC as a REMIC or
(b)  unless  the  Master  Servicer  has  determined  in its sole  discretion  to
indemnify  the Trust Fund against such tax,  cause such REMIC to be subject to a
tax on  "prohibited  transactions"  or  "contributions"  pursuant  to the  REMIC
Provisions.

      Section  10.02.   Master  Servicer,   REMIC   Administrator   and  Trustee
                        Indemnification.

      (a) The Trustee agrees to indemnify the Trust Fund, the Company, the REMIC
Administrator and the Master Servicer for any taxes and costs including, without
limitation,  any  reasonable  attorneys fees imposed on or incurred by the Trust
Fund,  the  Company  or the  Master  Servicer,  as a result  of a breach  of the
Trustee's covenants set forth in Article VIII or this Article X.

      (b) The REMIC  Administrator  agrees to  indemnify  the  Trust  Fund,  the
Company, the Master Servicer and the Trustee for any taxes and costs (including,
without  limitation,  any reasonable  attorneys' fees) imposed on or incurred by
the Trust Fund, the Company,  the Master Servicer or the Trustee, as a result of
a breach of the REMIC Administrator's covenants set forth in this Article X with
respect to compliance with the REMIC Provisions,  including without  limitation,
any penalties  arising from the Trustee's  execution of Tax Returns  prepared by
the REMIC  Administrator  that contain errors or omissions;  provided,  however,
that such liability will not be imposed to the extent such breach is a result of
an error or omission in information  provided to the REMIC  Administrator by the
Master Servicer in which case Section 10.02(c) will apply.

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      (c) The Master  Servicer  agrees to indemnify the Trust Fund, the Company,
the REMIC  Administrator  and the  Trustee  for any taxes and costs  (including,
without  limitation,  any reasonable  attorneys' fees) imposed on or incurred by
the Trust Fund, the Company, the REMIC Administrator or the Trustee, as a result
of a breach of the Master Servicer's covenants set forth in this Article X or in
Article III with  respect to  compliance  with the REMIC  Provisions,  including
without  limitation,  any penalties arising from the Trustee's  execution of Tax
Returns prepared by the Master Servicer that contain errors or omissions.

      Section 10.03. Designation of REMIC(s).

      As provided in Section 10.03 of the Series Supplement.

      Section 10.04.  Distributions on the  Uncertificated  REMIC I and REMIC II
      Regular Interests.

      As provided in Section 10.04 of the Series Supplement.

      Section 10.05. Compliance with Withholding Requirements.

      As provided in Section 10.05 of the Series Supplement.

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                                   Article XI

                            MISCELLANEOUS PROVISIONS

      Section 11.01. Amendment.

      (a) This Agreement or any Custodial  Agreement may be amended from time to
time by the Company, the Master Servicer and the Trustee, without the consent of
any of the Certificateholders:

            (i) to cure any ambiguity,

            (ii) to correct or  supplement  any  provisions  herein or  therein,
      which may be inconsistent  with any other provisions  herein or therein or
      to correct any error,

            (iii) to modify,  eliminate or add to any of its  provisions to such
      extent as shall be necessary or desirable to maintain the qualification of
      the Trust Fund as a REMIC at all times that any Certificate is outstanding
      or to avoid or minimize the risk of the imposition of any tax on the Trust
      Fund  pursuant  to the Code that would be a claim  against the Trust Fund,
      provided that the Trustee has received an Opinion of Counsel to the effect
      that  (A)  such  action  is  necessary  or  desirable  to  maintain   such
      qualification  or to avoid or minimize the risk of the  imposition  of any
      such tax and (B) such action  will not  adversely  affect in any  material
      respect the interests of any Certificateholder,

            (iv) to  change  the  timing  and/or  nature  of  deposits  into the
      Custodial  Account  or the  Certificate  Account  or to change the name in
      which  the  Custodial  Account  is  maintained,   provided  that  (A)  the
      Certificate  Account  Deposit  Date  shall in no  event be later  than the
      related  Distribution  Date, (B) such change shall not, as evidenced by an
      Opinion of Counsel, adversely affect in any material respect the interests
      of any  Certificateholder  and (C)  such  change  shall  not  result  in a
      reduction of the rating  assigned to any Class of  Certificates  below the
      lower  of  the  then-current   rating  or  the  rating  assigned  to  such
      Certificates  as  of  the  Closing  Date  (in  the  case  of  the  Insured
      Certificates  (as defined in the Series  Supplement),  such  determination
      shall be made without giving effect to the Certificate  Policy (as defined
      in the Series  Supplement)),  as  evidenced  by a letter  from each Rating
      Agency to such effect,

            (v) to modify, eliminate or add to the provisions of Section 5.02(f)
      or  any  other  provision  hereof  restricting  transfer  of the  Class  R
      Certificates,  by virtue  of their  being the  "residual  interests"  in a
      REMIC,  provided that (A) such change shall not result in reduction of the
      rating assigned to any such Class of  Certificates  below the lower of the
      then-current  rating or the rating assigned to such Certificates as of the
      Closing Date (in the case of the Insured  Certificates  (as defined in the
      Series Supplement), such determination shall be made without giving effect
      to the  Certificate  Policy (as  defined in the  Series  Supplement)),  as
      evidenced by a letter from each Rating Agency to such effect, and (B) such
      change shall not (subject to Section 10.01(f)), as evidenced by an Opinion
      of Counsel (at the expense of the party seeking so to modify, eliminate or
      add such  provisions),  cause any REMIC  created  hereunder  or any of the
      Certificateholders (other

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<PAGE>

      than the  transferor)  to be subject to a federal tax caused by a transfer
      to a Person that is not a Permitted Transferee,

            (vi) to make  any  other  provisions  with  respect  to  matters  or
      questions  arising under this Agreement or such Custodial  Agreement which
      shall  not  be  materially   inconsistent  with  the  provisions  of  this
      Agreement, provided that such action shall not, as evidenced by an Opinion
      of Counsel,  adversely affect in any material respect the interests of any
      Certificateholder or

            (vii) to amend any provision  herein or therein that is not material
      to any of the Certificateholders.

      (b) This  Agreement or any  Custodial  Agreement  may also be amended from
time to time by the  Company,  the  Master  Servicer  and the  Trustee  with the
consent of the Holders of Certificates evidencing in the aggregate not less than
66% of the Percentage Interests of each Class of Certificates with a Certificate
Principal  Balance greater than zero affected  thereby for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or such Custodial  Agreement or of modifying in any manner the
rights of the Holders of Certificates of such Class; provided,  however, that no
such amendment shall:

            (i)  reduce in any  manner  the  amount  of, or delay the timing of,
      payments which are required to be distributed on any  Certificate  without
      the consent of the Holder of such Certificate,

            (ii) reduce the aforesaid  percentage of  Certificates  of any Class
      the Holders of which are required to consent to any such amendment, in any
      such case without the consent of the Holders of all  Certificates  of such
      Class then outstanding.

      (c) Notwithstanding any contrary provision of this Agreement,  the Trustee
shall not consent to any amendment to this Agreement  unless it shall have first
received an Opinion of Counsel  (subject to Section  10.01(f) and at the expense
of the party seeking such  amendment)  to the effect that such  amendment or the
exercise of any power granted to the Master Servicer, the Company or the Trustee
in accordance with such amendment is permitted  hereunder and will not result in
the  imposition  of a federal  tax on the Trust Fund or cause any REMIC  created
under the Series  Supplement  to fail to qualify as a REMIC at any time that any
Certificate is outstanding.

      (d) Promptly  after the execution of any such  amendment the Trustee shall
furnish written notification of the substance of such amendment to the Custodian
and each  Certificateholder.  It  shall  not be  necessary  for the  consent  of
Certificateholders  under this Section 11.01 to approve the  particular  form of
any proposed amendment, but it shall be sufficient if such consent shall approve
the substance  thereof.  The manner of obtaining such consents and of evidencing
the  authorization  of the  execution  thereof  by  Certificateholders  shall be
subject to such reasonable regulations as the Trustee may prescribe.

      (e) The Company shall have the option,  in its sole discretion,  to obtain
and  deliver  to  the  Trustee  any  corporate  guaranty,   payment  obligation,
irrevocable  letter  of  credit,   surety  bond,  insurance  policy  or  similar
instrument or a reserve fund, or any combination of the foregoing, for

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the purpose of protecting the Holders of the Class B Certificates against any or
all Realized  Losses or other  shortfalls.  Any such instrument or fund shall be
held by the Trustee for the benefit of the Class B Certificateholders, but shall
not be and shall not be deemed  to be under any  circumstances  included  in the
Trust Fund. To the extent that any such instrument or fund constitutes a reserve
fund for federal income tax purposes,  (i) any reserve fund so established shall
be an outside  reserve  fund and not an asset of the Trust  Fund,  (ii) any such
reserve fund shall be owned by the Company, and (iii) amounts transferred by the
Trust Fund to any such reserve fund shall be treated as amounts  distributed  by
the Trust Fund to the  Company  or any  successor,  all  within  the  meaning of
Treasury  Regulations Section 1.860G-2(h) as it reads as of the Cut-off Date. In
connection with the provision of any such instrument or fund, this Agreement and
any provision hereof may be modified,  added to, deleted or otherwise amended in
any manner  that is  related or  incidental  to such  instrument  or fund or the
establishment or  administration  thereof,  such amendment to be made by written
instrument  executed or  consented  to by the Company but without the consent of
any  Certificateholder  and without  the  consent of the Master  Servicer or the
Trustee being  required  unless any such  amendment  would impose any additional
obligation  on, or  otherwise  adversely  affect  the  interests  of the  Senior
Certificateholders,  the Class M Certificateholders,  the Master Servicer or the
Trustee,  as applicable;  provided that the Company obtains  (subject to Section
10.01(f))  an Opinion of Counsel  (which  need not be an opinion of  Independent
counsel)  to the effect that any such  amendment  will not cause (a) any federal
tax to be imposed on the Trust Fund,  including without limitation,  any federal
tax imposed on "prohibited transactions" under Section 860F(a)(1) of the Code or
on "contributions  after the startup date" under Section  860G(d)(1) of the Code
and (b) any REMIC  created  hereunder  to fail to qualify as a REMIC at any time
that any  Certificate  is  outstanding.  In the event that the Company elects to
provide such  coverage in the form of a limited  guaranty  provided by GMAC LLC,
the Company may elect that the text of such amendment to this Agreement shall be
substantially  in  the  form  attached  hereto  as  Exhibit  K  (in  which  case
Residential  Funding's  Subordinate  Certificate Loss Obligation as described in
such exhibit  shall be  established  by  Residential  Funding's  consent to such
amendment) and that the limited  guaranty shall be executed in the form attached
hereto  as  Exhibit  L,  with  such  changes  as the  Company  shall  deem to be
appropriate;  it being understood that the Trustee has reviewed and approved the
content of such forms and that the  Trustee's  consent  or  approval  to the use
thereof is not required.

      Section 11.02. Recordation of Agreement; Counterparts.

      (a) To the extent  permitted by applicable  law, this Agreement is subject
to recordation in all  appropriate  public offices for real property  records in
all the counties or other  comparable  jurisdictions  in which any or all of the
properties  subject to the Mortgages are situated,  and in any other appropriate
public  recording  office or elsewhere,  such  recordation to be effected by the
Master Servicer and at its expense on direction by the Trustee  (pursuant to the
request  of  Holders  of  Certificates  entitled  to at least 25% of the  Voting
Rights),  but only upon  direction  accompanied  by an Opinion of Counsel to the
effect that such recordation  materially and beneficially  affects the interests
of the Certificateholders.

      (b) For the purpose of  facilitating  the recordation of this Agreement as
herein  provided  and  for  other  purposes,  this  Agreement  may  be  executed
simultaneously in any number

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of counterparts,  each of which  counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same instrument.

      Section 11.03. Limitation on Rights of Certificateholders.

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

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

      (c) No  Certificateholder  shall have any right by virtue of any provision
of this  Agreement to institute  any suit,  action or proceeding in equity or at
law  upon or  under  or with  respect  to this  Agreement,  unless  such  Holder
previously  shall have given to the  Trustee a written  notice of default and of
the continuance thereof, as hereinbefore  provided,  and unless also the Holders
of  Certificates  of any Class  evidencing in the aggregate not less than 25% of
the related Percentage  Interests of such Class, shall have made written request
upon the Trustee to institute such action, suit or proceeding in its own name as
Trustee  hereunder  and  shall  have  offered  to the  Trustee  such  reasonable
indemnity as it may require  against the costs,  expenses and  liabilities to be
incurred therein or thereby,  and the Trustee,  for 60 days after its receipt of
such notice, request and offer of indemnity,  shall have neglected or refused to
institute any such action,  suit or proceeding it being understood and intended,
and being  expressly  covenanted  by each  Certificateholder  with  every  other
Certificateholder  and the Trustee,  that no one or more Holders of Certificates
of any  Class  shall  have any  right in any  manner  whatever  by virtue of any
provision of this  Agreement to affect,  disturb or prejudice  the rights of the
Holders of any other of such  Certificates  of such Class or any other Class, or
to  obtain or seek to  obtain  priority  over or  preference  to any other  such
Holder,  or to  enforce  any right  under this  Agreement,  except in the manner
herein provided and for the common benefit of  Certificateholders  of such Class
or all Classes,  as the case may be. For the protection  and  enforcement of the
provisions  of this  Section  11.03,  each and every  Certificateholder  and the
Trustee  shall be entitled  to such  relief as can be given  either at law or in
equity.

      Section 11.04. Governing Law.

      This agreement and the Certificates  shall be governed by and construed in
accordance  with the laws of the State of New York and the  obligations,  rights
and remedies of the parties  hereunder  shall be determined  in accordance  with
such laws.

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      Section 11.05. Notices.

      As provided in Section 11.05 of the Series Supplement.

      Section 11.06. Required Notices to Rating Agency and Subservicer.

      The Company, the Master Servicer or the Trustee, as applicable,  (i) shall
notify each Rating Agency at such time as it is otherwise  required  pursuant to
this Agreement to give notice of the occurrence of, any of the events  described
in clause (a), (b), (c), (d), (g), (h), (i) or (j) below,  (ii) shall notify the
Subservicer at such time as it is otherwise  required pursuant to this Agreement
to give notice of the occurrence of, any of the events  described in clause (a),
(b), (c)(1), (g)(1), or (i) below, or (iii) provide a copy to each Rating Agency
at such time as otherwise required to be delivered pursuant to this Agreement of
any of the statements described in clauses (e) and (f) below:

            (a) a material change or amendment to this Agreement,

            (b) the occurrence of an Event of Default,

            (c)  (1)  the  termination  or  appointment  of a  successor  Master
      Servicer or (2) the termination or appointment of a successor Trustee or a
      change in the majority ownership of the Trustee,

            (d) the  filing of any claim  under the  Master  Servicer's  blanket
      fidelity bond and the errors and omissions  insurance  policy  required by
      Section 3.12 or the  cancellation  or  modification  of coverage under any
      such instrument,

            (e) the  statement  required to be  delivered to the Holders of each
      Class of Certificates pursuant to Section 4.03,

            (f) the  statements  required to be  delivered  pursuant to Sections
      3.18 and 3.19,

            (g) (1) a change in the location of the  Custodial  Account or (2) a
      change in the location of the Certificate Account,

            (h) the occurrence of any monthly cash flow shortfall to the Holders
      of any Class of  Certificates  resulting  from the  failure  by the Master
      Servicer to make an Advance pursuant to Section 4.04,

            (i) the occurrence of the Final Distribution Date, and

            (j) the repurchase of or substitution for any Mortgage Loan,

provided,  however,  that with respect to notice of the occurrence of the events
described in clauses (d), (g) or (h) above,  the Master  Servicer  shall provide
prompt written notice to each Rating Agency and the Subservicer,  if applicable,
of any such event known to the Master Servicer.

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      Section 11.07. Severability of Provisions.

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

      Section 11.08. Supplemental Provisions for Resecuritization.

      This Agreement may be  supplemented by means of the addition of a separate
Article hereto (a "Supplemental  Article") for the purpose of resecuritizing any
of the Certificates issued hereunder,  under the following  circumstances.  With
respect to any Class or Classes of Certificates issued hereunder, or any portion
of any such  Class,  as to which the  Company or any of its  Affiliates  (or any
designee thereof) is the registered Holder (the  "Resecuritized  Certificates"),
the  Company  may  deposit  such  Resecuritized  Certificates  into a new REMIC,
grantor trust or custodial arrangement (a "Restructuring Vehicle") to be held by
the Trustee  pursuant to a Supplemental  Article.  The instrument  adopting such
Supplemental  Article shall be executed by the Company,  the Master Servicer and
the Trustee;  provided,  that neither the Master  Servicer nor the Trustee shall
withhold  their  consent  thereto  if their  respective  interests  would not be
materially  adversely  affected  thereby.  To the  extent  that the terms of the
Supplemental  Article do not in any way affect any  provisions of this Agreement
as to any of the Certificates  initially issued  hereunder,  the adoption of the
Supplemental Article shall not constitute an "amendment" of this Agreement.

      Each  Supplemental  Article  shall  set  forth  all  necessary  provisions
relating to the holding of the  Resecuritized  Certificates by the Trustee,  the
establishment of the  Restructuring  Vehicle,  the issuing of various classes of
new certificates by the  Restructuring  Vehicle and the distributions to be made
thereon,  and any  other  provisions  necessary  for the  purposes  thereof.  In
connection  with each  Supplemental  Article,  the Company  shall deliver to the
Trustee an Opinion of Counsel to the effect that (i) the  Restructuring  Vehicle
will qualify as a REMIC,  grantor  trust or other entity not subject to taxation
for  federal  income tax  purposes  and (ii) the  adoption  of the  Supplemental
Article will not endanger the status of the Trust Fund as a REMIC or (subject to
Section  10.01(f))  result  in the  imposition  of a tax  upon  the  Trust  Fund
(including but not limited to the tax on prohibited  transactions  as defined in
Section  860F(a)(2) of the Code and the tax on  contributions  to a REMIC as set
forth in Section 860G(d) of the Code).

      Section 11.09. Allocation of Voting Rights.

      As provided in Section 11.09 of the Series Supplement.

      Section 11.10. No Petition.

      As provided in Section 11.10 of the Series Supplement.

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                                  Article XII

                          COMPLIANCE WITH REGULATION AB

      Section 12.01. Intent of the Parties; Reasonableness.

            The Company,  the Trustee and the Master  Servicer  acknowledge  and
agree that the purpose of this Article XII is to  facilitate  compliance  by the
Company with the  provisions of Regulation AB and related rules and  regulations
of the Commission.  The Company shall not exercise its right to request delivery
of information or other  performance  under these  provisions other than in good
faith,  or for  purposes  other than  compliance  with the  Securities  Act, the
Exchange  Act  and  the  rules  and  regulations  of the  Commission  under  the
Securities Act and the Exchange Act. Each of the Master Servicer and the Trustee
acknowledges  that  interpretations  of the  requirements  of  Regulation AB may
change  over  time,  whether  due  to  interpretive  guidance  provided  by  the
Commission or its staff,  consensus among  participants  in the  mortgage-backed
securities markets,  advice of counsel, or otherwise,  and agrees to comply with
reasonable  requests  made  by  the  Company  in  good  faith  for  delivery  of
information under these provisions on the basis of evolving  interpretations  of
Regulation  AB.  Each of the Master  Servicer  and the Trustee  shall  cooperate
reasonably  with the  Company to deliver to the  Company  (including  any of its
assignees  or  designees),   any  and  all  disclosure,   statements,   reports,
certifications,  records and any other information  necessary in the reasonable,
good faith determination of the Company to permit the Company to comply with the
provisions of Regulation AB.

      Section 12.02. Additional Representations and Warranties of the Trustee.

            (a) The  Trustee  shall be deemed to  represent  and  warrant to the
Company as of the Closing Date and on each date on which information is provided
to the Company under Sections 12.01, 12.02(b) or 12.03 that, except as disclosed
in writing to the  Company  prior to such date:  (i) it is not aware and has not
received  notice  that any  default,  early  amortization  or other  performance
triggering event has occurred as to any other Securitization  Transaction due to
any default of the Trustee; (ii) there are no aspects of its financial condition
that  could  have a  material  adverse  effect on the  performance  by it of its
trustee obligations under this Agreement or any other Securitization Transaction
as to which it is the trustee; (iii) there are no material legal or governmental
proceedings  pending  (or known to be  contemplated)  against  it that  would be
material to Certificateholders;  (iv) there are no relationships or transactions
(as  described  in Item 1119(b) of  Regulation  AB) relating to the Trustee with
respect to the  Company  or any  sponsor,  issuing  entity,  servicer,  trustee,
originator,  significant  obligor,  enhancement  or  support  provider  or other
material  transaction  party (as each of such terms are used in  Regulation  AB)
relating to the  Securitization  Transaction  contemplated by the Agreement,  as
identified  by the  Company to the  Trustee in  writing as of the  Closing  Date
(each, a "Transaction  Party") that are outside the ordinary  course of business
or on terms other than would be obtained in an arm's length  transaction with an
unrelated third party, apart from the Securitization  Transaction,  and that are
material  to the  investors'  understanding  of the  Certificates;  and  (v) the
Trustee is not an affiliate (as  contemplated  by Item 1119(a) of Regulation AB)
of any Transaction  Party. The Company shall notify the Trustee of any change in
the identity of a Transaction Party after the Closing Date.

                                      123
<PAGE>

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

      Section 12.03. Information to Be Provided by the Trustee.

            For so long as the Certificates are outstanding,  for the purpose of
satisfying  the  Company's  reporting  obligation  under the  Exchange  Act with
respect to any class of Certificates, the Trustee shall provide to the Company a
written  description of (a) any litigation or governmental  proceedings  pending
against  the  Trustee  as of the last day of each  calendar  month that would be
material to  Certificateholders,  and (b) any affiliations or relationships  (as
described in Item 1119 of Regulation AB) that develop following the Closing Date
between the Trustee and any  Transaction  Party of the type described in Section
12.02(a)(iv)  or  12.02(a)(v)  as of the last  day of each  calendar  year.  Any
descriptions  required with respect to legal proceedings,  as well as updates to
previously  provided  descriptions,  under this Section  12.03 shall be given no
later than five  Business  Days prior to the  Determination  Date  following the
month in which the  relevant  event  occurs,  and any notices  and  descriptions
required with respect to affiliations, as well as updates to previously provided
descriptions,  under this Section  12.03 shall be given no later than January 31
of the calendar year following the year in which the relevant  event occurs.  As
of the related  Distribution  Date with respect to each Report on Form 10-D with
respect  to the  Certificates  filed by or on behalf of the  Company,  and as of
March 15  preceding  the date  each  Report on Form  10-K  with  respect  to the
Certificates is filed, the Trustee shall be deemed to represent and warrant that
any  information  previously  provided by the Trustee  under this Article XII is
materially  correct and does not have any material  omissions unless the Trustee
has provided an update to such  information.  The Company will allow the Trustee
to review any  disclosure  relating to material  litigation  against the Trustee
prior to filing such  disclosure  with the  Commission to the extent the Company
changes the information provided by the Trustee.

      Section 12.04. Report on Assessment of Compliance and Attestation.

            On or before March 15 of each calendar year, the Trustee shall:

      (a)  deliver  to the  Company a report (in form and  substance  reasonably
satisfactory  to the Company)  regarding the Trustee's  assessment of compliance
with the applicable Servicing Criteria during the immediately preceding calendar
year,  as required  under Rules  13a-18 and 15d-18 of the  Exchange Act and Item
1122 of Regulation  AB. Such report shall be signed by an authorized  officer of
the Trustee,  and shall  address  each of the  Servicing  Criteria  specified on
Exhibit R hereto; and

      (b) deliver to the Company a report of a registered public accounting firm
satisfying the  requirements of Rule 2-01 of Regulation S-X under the Securities
Act and the  Exchange  Act that  attests to, and reports on, the  assessment  of
compliance made by the Trustee and delivered

                                      124
<PAGE>

pursuant to the preceding  paragraph.  Such  attestation  shall be in accordance
with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and
the Exchange Act.

      Section 12.05. Indemnification; Remedies.

      (a) The  Trustee  shall  indemnify  the  Company,  each  affiliate  of the
Company, the Master Servicer and each affiliate of the Master Servicer,  and the
respective present and former directors,  officers, employees and agents of each
of the  foregoing,  and shall hold each of them  harmless  from and  against any
losses,  damages,  penalties,  fines,  forfeitures,  legal fees and expenses and
related  costs,  judgments,  and any other costs,  fees and expenses that any of
them may sustain arising out of or based upon:

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

                  (ii) any failure by the  Trustee to deliver  any  information,
report,  certification or other material when and as required under this Article
XII, other than a failure by the Trustee to deliver an accountants' attestation.

      (b) In the case of any failure of performance  described in clause (ii) of
Section 12.05(a),  as well as a failure to deliver an accountants'  attestation,
the Trustee shall (i) promptly  reimburse  the Company for all costs  reasonably
incurred   by  the  Company  in  order  to  obtain  the   information,   report,
certification,  accountants'  attestation or other material not delivered by the
Trustee as required and (ii)  cooperate with the Company to mitigate any damages
that may result from such failure.

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

      (d)  Notwithstanding  any provision in this Section 12.05 to the contrary,
the parties agree that none of the Trustee,  the Company or the Master  Servicer
shall  be  liable  to the  other  for  any  consequential  or  punitive  damages
whatsoever, whether in contract, tort (including

                                      125
<PAGE>

negligence  and strict  liability),  or any other legal or equitable  principle;
provided,  however, that such limitation shall not be applicable with respect to
third party claims made against a party.

                                      126
<PAGE>

                                    EXHIBIT A

       FORM OF CLASS A CERTIFICATE, [PRINCIPAL ONLY/CLASS A-P] CERTIFICATE
                    AND [INTEREST ONLY/CLASS A-V] CERTIFICATE

      SOLELY  FOR U.S.  FEDERAL  INCOME  TAX  PURPOSES,  THIS  CERTIFICATE  IS A
"REGULAR  INTEREST" IN A "REAL  ESTATE  MORTGAGE  INVESTMENT  CONDUIT," AS THOSE
TERMS ARE  DEFINED,  RESPECTIVELY,  IN  SECTIONS  860G AND 860D OF THE  INTERNAL
REVENUE CODE OF 1986.

      UNLESS THIS  CERTIFICATE IS PRESENTED BY AN AUTHORIZED  REPRESENTATIVE  OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION  ("DTC"),  TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER,  EXCHANGE,  OR PAYMENT,  AND ANY CERTIFICATE
ISSUED  IS  REGISTERED  IN THE NAME OF CEDE & CO.  OR IN SUCH  OTHER  NAME AS IS
REQUESTED  BY AN  AUTHORIZED  REPRESENTATIVE  OF DTC (AND ANY PAYMENT IS MADE TO
CEDE  &  CO.  OR  TO  SUCH  OTHER  ENTITY  AS  IS  REQUESTED  BY  AN  AUTHORIZED
REPRESENTATIVE  OF DTC), ANY TRANSFER,  PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE  BY OR TO ANY PERSON IS  WRONGFUL  INASMUCH  AS THE  REGISTERED  OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

      [THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING
THE U.S.  FEDERAL  INCOME TAX  ORIGINAL  ISSUE  DISCOUNT  ("OID")  RULES TO THIS
CERTIFICATE.  THE  ISSUE  DATE OF THIS  CERTIFICATE  IS  ___________  __,  ____.
ASSUMING  THAT THE  MORTGAGE  LOANS  PREPAY AT [___]%  OF THE  PREPAYMENT  SPEED
ASSUMPTION (AS DESCRIBED IN THE PROSPECTUS SUPPLEMENT), [AND ASSUMING A CONSTANT
PASS-THROUGH RATE EQUAL TO THE INITIAL  PASS-THROUGH RATE,] THIS CERTIFICATE HAS
BEEN ISSUED WITH NO MORE THAN $[ ] OF OID PER  [$1,000]  [$100,000]  OF [INITIAL
CERTIFICATE  PRINCIPAL BALANCE] [NOTIONAL AMOUNT], THE YIELD TO MATURITY IS [ ]%
AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN
$[  ]  PER  [$1,000]  [$100,000]  OF  [INITIAL  CERTIFICATE  PRINCIPAL  BALANCE]
[NOTIONAL AMOUNT],  COMPUTED USING THE APPROXIMATE  METHOD. NO REPRESENTATION IS
MADE THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT SPEED
ASSUMPTION  OR AT ANY  OTHER  RATE OR AS TO THE  CONSTANCY  OF THE  PASS-THROUGH
RATE.]

<PAGE>

Certificate No.                   [___%][Variable] Pass-Through Rate [based on a
                                  Notional Amount]
Class A-__ Senior
Date of Pooling and Servicing     [Percentage Interest: ______%]
Agreement and Cut-off Date:
___________ 1, ____               Aggregate Initial [Certificate Principal
                                  Balance] [[Interest Only/Class A-V] Notional
First Distribution Date:          Amount] [Subclass Notional Amount] of the
_________ 25, ____                Class A-__ Certificates:

Master Servicer:                  [Initial] [Certificate Principal
Residential Funding               Balance] [Interest Only/Class A-V] [Subclass]
Company, LLC                      Notional Amount] of this Certificate:
                                  $____________]
Assumed Final
Distribution Date:                CUSIP 76110F-______
___________ 25, ____

                 MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE
                                 SERIES ____-___

            evidencing a percentage  interest in the distributions  allocable to
            the Class A-  Certificates  with respect to a Trust Fund  consisting
            primarily  of a pool  of  [conventional  one- to  four-family  fixed
            interest rate first  mortgage  loans] formed and sold by RESIDENTIAL
            ACCREDIT LOANS, INC.

            This  Certificate  is  payable  solely  from the assets of the Trust
Fund,  and does not  represent  an  obligation  of or  interest  in  Residential
Accredit Loans, Inc., the Master Servicer, the Trustee referred to below or GMAC
Mortgage Group, LLC or any of their affiliates. Neither this Certificate nor the
underlying  Mortgage Loans are guaranteed or insured by any governmental  agency
or instrumentality or by Residential  Accredit Loans, Inc., the Master Servicer,
the Trustee or GMAC Mortgage Group, LLC or any of their affiliates.  None of the
Company,  the  Master  Servicer,  GMAC  Mortgage  Group,  LLC or  any  of  their
affiliates  will have any  obligation  with respect to any  certificate or other
obligation secured by or payable from payments on the Certificates.

            This certifies  that  ____________  is the  registered  owner of the
Percentage  Interest  evidenced by this  Certificate  [(obtained by dividing the
[Initial  Certificate  Principal  Balance]  [Initial  [Interest  Only/Class A-V]
Notional  Amount] of this  Certificate  by the  aggregate  [Initial  Certificate
Principal Balance of all Class A- Certificates]  [Initial  [Interest  Only/Class
A-V] Notional Amounts of all [Interest  Only/Class A-V]  Certificates],  both as
specified  above)]  in  certain  distributions  with  respect  to the Trust Fund
consisting  primarily  of  an  interest  in a  pool  of  [conventional  one-  to
four-family  fixed interest rate first mortgage  loans] (the "Mortgage  Loans"),
formed and sold by Residential  Accredit  Loans,  Inc.  (hereinafter  called the
"Company," which term includes any successor entity under the Agreement referred
to below).  The Trust  Fund was  created  pursuant  to a Pooling  and  Servicing
Agreement dated as

                                      A-2
<PAGE>

specified  above (the  "Agreement")  among the Company,  the Master Servicer and
__________________,  as  trustee  (the  "Trustee"),  a summary of certain of the
pertinent provisions of which is set forth hereafter.  To the extent not defined
herein,  the  capitalized  terms used herein have the  meanings  assigned in the
Agreement.  This  Certificate  is issued  under  and is  subject  to the  terms,
provisions  and conditions of the  Agreement,  to which  Agreement the Holder of
this  Certificate by virtue of the  acceptance  hereof assents and by which such
Holder is bound.

            Pursuant to the terms of the Agreement,  a distribution will be made
on the 25th day of each  month or, if such 25th day is not a Business  Day,  the
Business Day  immediately  following (the  "Distribution  Date"),  commencing as
described  in the  Agreement,  to the Person in whose name this  Certificate  is
registered  at the close of business on the last day (or if such last day is not
a Business  Day, the Business Day  immediately  preceding  such last day) of the
month immediately  preceding the month of such distribution (the "Record Date"),
from the Available  Distribution Amount in an amount equal to the product of the
Percentage  Interest  evidenced by this Certificate and the amount [(of interest
and  principal,  if any)]  required  to be  distributed  to  Holders of Class A-
Certificates on such Distribution Date. [The [Interest  Only/Class A-V] Notional
Amount  of  the  [Interest  Only/Class  A-V]  Certificates  as of  any  date  of
determination is equal to the aggregate Stated Principal Balance of the Mortgage
Loans corresponding to the Uncertificated REMIC Regular Interests represented by
such [Interest  Only/Class A-V]  Certificates.] [The Subclass Notional Amount of
the [Interest  Only/Class A-V]-  Certificates as of any date of determination is
equal  to  the  aggregate  Stated  Principal   Balance  of  the  Mortgage  Loans
corresponding to the Uncertificated REMIC Regular Interests  represented by such
[Interest  Only/Class A-V]-  Certificates  immediately prior to such date.] [The
[Interest  Only/Class  A-V][-  ]  Certificates  have  no  Certificate  Principal
Balance.]

            Distributions  on this Certificate will be made either by the Master
Servicer  acting on behalf of the Trustee or by a Paying Agent  appointed by the
Trustee in immediately  available  funds (by wire transfer or otherwise) for the
account of the Person entitled thereto if such Person shall have so notified the
Master  Servicer or such Paying Agent,  or by check mailed to the address of the
Person  entitled  thereto,  as  such  name  and  address  shall  appear  on  the
Certificate Register.

            Notwithstanding   the  above,   the  final   distribution   on  this
Certificate  will be made after due notice of the pendency of such  distribution
and only upon  presentation  and surrender of this  Certificate at the office or
agency  appointed  by the Trustee for that  purpose.  The  [Initial  Certificate
Principal Balance] [Initial [Interest  Only/Class A-V] Notional Amount] [initial
Subclass  Notional  Amount]  of  this  Certificate  is set  forth  above.]  [The
Certificate   Principal  Balance  hereof  will  be  reduced  to  the  extent  of
distributions allocable to principal and any Realized Losses allocable hereto.]

            This  Certificate is one of a duly authorized  issue of Certificates
issued in several  Classes  designated  as  Mortgage  Asset-Backed  Pass-Through
Certificates  of the Series  specified  hereon (herein  collectively  called the
"Certificates").

            The  Certificates  are  limited  in  right  of  payment  to  certain
collections  and  recoveries   respecting  the  Mortgage  Loans,   all  as  more
specifically set forth herein and in the Agreement. In the event Master Servicer
funds are advanced with respect to any Mortgage

                                      A-3
<PAGE>

Loan,  such  advance  is  reimbursable  to the  Master  Servicer,  to the extent
provided in the Agreement, from related recoveries on such Mortgage Loan or from
other cash that would have been distributable to Certificateholders.

            As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the  Master  Servicer  from  time to time  for  purposes  other  than
distributions to Certificateholders,  such purposes including without limitation
reimbursement  to the Company  and the Master  Servicer  of  advances  made,  or
certain expenses incurred, by either of them.

            The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the  Company,  the  Master  Servicer  and  the  Trustee  and the  rights  of the
Certificateholders  under the  Agreement at any time by the Company,  the Master
Servicer  and the  Trustee  with the  consent  of the  Holders  of  Certificates
evidencing  in the aggregate  not less than 66% of the  Percentage  Interests of
each Class of Certificates  affected thereby.  Any such consent by the Holder of
this  Certificate  shall be  conclusive  and binding on such Holder and upon all
future  holders  of this  Certificate  and of any  Certificate  issued  upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the  Certificate.  The  Agreement  also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain  additional  circumstances,  without the
consent of the Holders of certain Classes of Certificates.

            As provided  in the  Agreement  and  subject to certain  limitations
therein  set forth,  the  transfer of this  Certificate  is  registrable  in the
Certificate  Register upon surrender of this  Certificate  for  registration  of
transfer at the offices or agencies appointed by the Trustee,  duly endorsed by,
or accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Trustee and the Certificate  Registrar duly
executed by the Holder  hereof or such  Holder's  attorney  duly  authorized  in
writing, and thereupon one or more new Certificates of authorized  denominations
evidencing  the same Class and aggregate  Percentage  Interest will be issued to
the designated transferee or transferees.

            The  Certificates  are  issuable  only  as  registered  Certificates
without coupons in Classes and in denominations  specified in the Agreement.  As
provided in the Agreement and subject to certain  limitations therein set forth,
Certificates are  exchangeable for new Certificates of authorized  denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

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

            The Company,  the Master  Servicer,  the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer,  the Trustee or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered  as the owner hereof for all purposes,  and neither the Company,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

                                      A-4
<PAGE>

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

            The  obligations   created  by  the  Agreement  in  respect  of  the
Certificates and the Trust Fund created thereby shall terminate upon the payment
to  Certificateholders  of all  amounts  held by or on behalf of the Trustee and
required to be paid to them pursuant to the  Agreement  following the earlier of
(i) the maturity or other  liquidation of the last Mortgage Loan subject thereto
or the disposition of all property  acquired upon foreclosure or deed in lieu of
foreclosure  of any Mortgage  Loan and (ii) the purchase by the Master  Servicer
from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such  Mortgage  Loans,  thereby  effecting  early  retirement  of the
Certificates.  The Agreement permits,  but does not require, the Master Servicer
to (i) purchase at a price determined as provided in the Agreement all remaining
Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
purchase in whole,  but not in part,  all of the  Certificates  from the Holders
thereof; provided, that any such option may only be exercised if the Pool Stated
Principal  Balance of the Mortgage Loans as of the Distribution  Date upon which
the proceeds of any such  purchase are  distributed  is less than ten percent of
the Cut-off Date Principal Balance of the Mortgage Loans.

            Reference  is  hereby  made  to  the  further   provisions  of  this
Certificate set forth on the reverse hereof,  which further provisions shall for
all purposes have the same effect as if set forth at this place.

            Unless the certificate of authentication hereon has been executed by
the Certificate  Registrar,  by manual signature,  this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.

                                      A-5
<PAGE>

            IN WITNESS  WHEREOF,  the Trustee has caused this  Certificate to be
duly executed.

Dated:                                [_________________________],
                                       as Trustee

                                      By: ____________________________
                                          Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

            This  is  one  of  the  Class  A-  Certificates  referred  to in the
within-mentioned Agreement.

                                      [___________________________],
                                        as Certificate Registrar

                                      By: ____________________________
                                          Authorized Signatory

                                      A-6
<PAGE>

                                   ASSIGNMENT

            FOR VALUE RECEIVED,  the undersigned  hereby sell(s),  assign(s) and
transfer(s) unto ____________________________________ (Please print or typewrite
name and address  including  postal zip code of assignee) a Percentage  Interest
evidenced  by the within  Mortgage  Asset-Backed  Pass-Through  Certificate  and
hereby  authorizes the transfer of  registration of such interest to assignee on
the Certificate Register of the Trust Fund.

            I (We)  further  direct  the  Certificate  Registrar  to issue a new
Certificate of a like  denomination  and Class,  to the above named assignee and
deliver such Certificate to the following address: _____________________________

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

                                      _________________________________________
Dated:                                Signature by or on behalf of assignor

                                      _________________________________________
                                          Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

            The  assignee   should   include  the   following  for  purposes  of
distribution:

            Distributions  shall be made,  by wire  transfer  or  otherwise,  in
immediately  available  funds to  ________________________  for the  account  of
__________________  account  number  ___________,  or, if  mailed  by check,  to
_____________________________Applicable   statements   should   be   mailed   to
__________________________.

            This  information  is  provided  by  ________________________,   the
assignee named above, or _________________________________, as its agent.

<PAGE>

                                   EXHIBIT A-1

                           FORM OF CLASS X CERTIFICATE

SOLELY FOR U.S.  FEDERAL  INCOME TAX PURPOSES,  THIS  CERTIFICATE  IS A "REGULAR
INTEREST" IN A "REAL  ESTATE  MORTGAGE  INVESTMENT  CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986.

UNLESS THIS  CERTIFICATE  IS PRESENTED BY AN  AUTHORIZED  REPRESENTATIVE  OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER,  EXCHANGE,  OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED  REPRESENTATIVE  OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

<PAGE>

Certificate No. ____                       Variable Pass-Through Rate
Class X Senior

Date of Pooling and Servicing Agreement    Percentage Interest: 100%
and Cut-off Date: __________ 1, ____

Master Servicer:                           Aggregate Initial Notional Amount of
Residential Funding Company, LLC           the Class XCertificates: $__________

First Distribution Date:                   Initial Notional Amount of this
__________ 25, ____                        Certificate: $_____________

Assumed Final Distribution Date:           CUSIP ________
_____________

                 MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE
                                SERIES ____-____

      Evidencing a  percentage  interest in the  distributions  allocable to the
      Class X Certificates with respect to a Trust Fund consisting  primarily of
      a   pool   of   [one-   to   four-family   residential,    payment-option,
      adjustable-rate  first lien  mortgage  loans with a negative  amortization
      feature] formed and sold by RESIDENTIAL ACCREDIT LOANS, INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Accredit  Loans,
Inc., the Master Servicer, the Trustee referred to below or GMAC Mortgage Group,
LLC or any of their  affiliates.  Neither this  Certificate  nor the  underlying
Mortgage  Loans  are  guaranteed  or  insured  by  any  governmental  agency  or
instrumentality or by Residential Accredit Loans, Inc., the Master Servicer, the
Trustee or GMAC  Mortgage  Group,  LLC or any of their  affiliates.  None of the
Company,  the  Master  Servicer,  GMAC  Mortgage  Group,  LLC or  any  of  their
affiliates  will have any  obligation  with respect to any  certificate or other
obligation secured by or payable from payments on the Certificates.

      This certifies that  _________________________  is the registered owner of
the Percentage Interest evidenced by this Certificate  (obtained by dividing the
Initial Notional Amount of this Certificate by the Aggregate  Notional Amount of
all Class X Certificates, both as specified above) in certain distributions with
respect to the Trust Fund consisting primarily of an interest in a pool of [one-
to four-family residential, payment-option,  adjustable-rate first lien mortgage
loans with a negative amortization  feature] (the "Mortgage Loans"),  formed and
sold by Residential  Accredit  Loans,  Inc.  (hereinafter  called the "Company,"
which term includes any successor entity under the Agreement referred to below).
The Trust Fund was created  pursuant to a Pooling and Servicing  Agreement dated
as specified above (the "Agreement") among the Company,  the Master Servicer and
________________________,  as trustee (the  "Trustee"),  a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not

                                     A-1-2
<PAGE>

defined herein,  the capitalized terms used herein have the meanings assigned in
the  Agreement.  This  Certificate  is issued under and is subject to the terms,
provisions  and conditions of the  Agreement,  to which  Agreement the Holder of
this  Certificate by virtue of the  acceptance  hereof assents and by which such
Holder is bound.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business  Day, the Business
Day immediately following (the "Distribution Date"),  commencing as described in
the Agreement, to the Person in whose name this Certificate is registered at the
close of  business  on the last day (or if such last day is not a Business  Day,
the Business Day immediately  preceding such last day) of the month  immediately
preceding the month of such distribution (the "Record Date"), from the Available
Distribution Amount in an amount equal to the product of the Percentage Interest
evidenced  by this  Certificate  and the amount  required to be  distributed  to
Holders  of  Class  X  Certificates  on  such  Distribution  Date.  The  Class X
Certificates have no Certificate Principal Balance.

      Distributions  on  this  Certificate  will be made  either  by the  Master
Servicer  acting on behalf of the Trustee or by a Paying Agent  appointed by the
Trustee in immediately  available  funds (by wire transfer or otherwise) for the
account of the Person entitled thereto if such Person shall have so notified the
Master  Servicer or such Paying Agent,  or by check mailed to the address of the
Person  entitled  thereto,  as  such  name  and  address  shall  appear  on  the
Certificate Register.

      Notwithstanding the above, the final distribution on this Certificate will
be made  after due notice of the  pendency  of such  distribution  and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose. The Initial Notional Amount of this Certificate
is set forth above.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes designated as Mortgage Asset-Backed Pass-Through Certificates
of the Series specified hereon (herein collectively called the "Certificates").

      The  Certificates  are limited in right of payment to certain  collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the  Agreement.  In the event Master  Servicer  funds are advanced
with respect to any Mortgage Loan,  such advance is  reimbursable  to the Master
Servicer,  to the extent provided in the Agreement,  from related  recoveries on
such  Mortgage  Loan or from other cash that  would have been  distributable  to
Certificateholders.

      As provided  in the  Agreement,  withdrawals  from the  Custodial  Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the  Master  Servicer  from  time to time  for  purposes  other  than
distributions to Certificateholders,  such purposes including without limitation
reimbursement  to the Company  and the Master  Servicer  of  advances  made,  or
certain expenses incurred, by either of them.

      The Agreement  permits,  with certain  exceptions  therein  provided,  the
amendment of the Agreement and the modification of the rights and obligations of
the Company, the Master

                                     A-1-3
<PAGE>

Servicer  and the  Trustee  and the rights of the  Certificateholders  under the
Agreement at any time by the Company,  the Master  Servicer and the Trustee with
the consent of the Holders of Certificates  evidencing in the aggregate not less
than 66% of the  Percentage  Interests  of each Class of  Certificates  affected
thereby.  Any such consent by the Holder of this Certificate shall be conclusive
and binding on such Holder and upon all future holders of this  Certificate  and
of any Certificate  issued upon the transfer hereof or in exchange herefor or in
lieu  hereof  whether  or  not  notation  of  such  consent  is  made  upon  the
Certificate.  The  Agreement  also  permits  the  amendment  thereof  in certain
circumstances without the consent of the Holders of any of the Certificates and,
in certain  additional  circumstances,  without  the  consent of the  Holders of
certain Classes of Certificates.

      As provided in the  Agreement and subject to certain  limitations  therein
set forth,  the transfer of this  Certificate is registrable in the  Certificate
Register upon surrender of this  Certificate for registration of transfer at the
offices or agencies  appointed by the Trustee,  duly endorsed by, or accompanied
by an assignment  in the form below or other  written  instrument of transfer in
form satisfactory to the Trustee and the Certificate  Registrar duly executed by
the Holder hereof or such  Holder's  attorney  duly  authorized in writing,  and
thereupon one or more new  Certificates of authorized  denominations  evidencing
the  same  Class  and  aggregate  Percentage  Interest  will  be  issued  to the
designated transferee or transferees.

      The  Certificates  are issuable  only as registered  Certificates  without
coupons in Classes and in denominations  specified in the Agreement. As provided
in  the  Agreement  and  subject  to  certain  limitations  therein  set  forth,
Certificates are  exchangeable for new Certificates of authorized  denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

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

      The  Company,  the  Master  Servicer,  the  Trustee  and  the  Certificate
Registrar and any agent of the Company, the Master Servicer,  the Trustee or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered  as the owner hereof for all purposes,  and neither the Company,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

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

      The  obligations  created by the Agreement in respect of the  Certificates
and the  Trust  Fund  created  thereby  shall  terminate  upon  the  payment  to
Certificateholders  of all  amounts  held by or on  behalf  of the  Trustee  and
required to be paid to them pursuant to the  Agreement  following the earlier of
(i) the maturity or other  liquidation of the last Mortgage Loan subject thereto
or the disposition of all property  acquired upon foreclosure or deed in lieu of
foreclosure  of any Mortgage  Loan and (ii) the purchase by the Master  Servicer
from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such Mortgage Loans, thereby

                                     A-1-4
<PAGE>

effecting early retirement of the Certificates.  The Agreement permits, but does
not  require,  the Master  Servicer  to (i)  purchase at a price  determined  as
provided in the Agreement all remaining Mortgage Loans and all property acquired
in respect of any Mortgage Loan or (ii) purchase in whole,  but not in part, all
of the Certificates from the Holders thereof; provided, that any such option may
only be exercised if the Pool Stated Principal  Balance of the Mortgage Loans as
of the  Distribution  Date upon  which the  proceeds  of any such  purchase  are
distributed  is less than ten percent of the Cut-off Date  Principal  Balance of
the Mortgage Loans.

      Reference is hereby made to the further provisions of this Certificate set
forth on the reverse  hereof,  which further  provisions  shall for all purposes
have the same effect as if set forth at this place.

      Unless the certificate of  authentication  hereon has been executed by the
Certificate  Registrar,  by  manual  signature,  this  Certificate  shall not be
entitled to any benefit under the Agreement or be valid for any purpose.

                                     A-1-5
<PAGE>

      IN WITNESS  WHEREOF,  the Trustee has caused this  Certificate  to be duly
executed.

Dated:                                [________________________________],
                                            as Trustee

                                      By: _____________________________
                                            Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

      This  is  one  of  the   Class   X   Certificates   referred   to  in  the
within-mentioned Agreement.

                                      [________________________________],
                                            as Certificate Registrar

                                      By: ______________________________
                                            Authorized Signatory

                                     A-1-6
<PAGE>

                                   ASSIGNMENT

      FOR  VALUE  RECEIVED,  the  undersigned  hereby  sell(s),   assign(s)  and
transfer(s) unto _______________________________________________________________
(Please  print  or  typewrite  name and  address  including  postal  zip code of
assignee) a Percentage  Interest  evidenced by the within Mortgage  Asset-Backed
Pass-Through  Certificate and hereby  authorizes the transfer of registration of
such interest to assignee on the Certificate Register of the Trust Fund.

      I (We) further direct the Certificate Registrar to issue a new Certificate
of a like  denomination  and Class, to the above named assignee and deliver such
Certificate to the following address:

________________________________________________________________________________

                                      _______________________________________
                                      Signature by or on behalf of assignor

                                      _______________________________________
                                      Signature Guaranteed
Dated:

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

      Distributions shall be made, by wire transfer or otherwise, in immediately
available   funds  to  for  the  account  of   _______________   account  number
______________________, or, if mailed by check, to

________________________________________________________________________________

Applicable statements should be mailed to

________________________________________________________________________________

      This  information  is provided by  _______________________,  the  assignee
named above, or _______________________ as its agent.

<PAGE>

                                    EXHIBIT B

                           FORM OF CLASS M CERTIFICATE

      THIS  CERTIFICATE  IS  SUBORDINATED  IN RIGHT  OF  PAYMENT  TO THE  SENIOR
CERTIFICATES  [CLASS M-1 CERTIFICATES] [AND CLASS M-2 CERTIFICATES] AS DESCRIBED
IN THE AGREEMENT (AS DEFINED BELOW).

      SOLELY  FOR U.S.  FEDERAL  INCOME  TAX  PURPOSES,  THIS  CERTIFICATE  IS A
"REGULAR  INTEREST" IN A "REAL  ESTATE  MORTGAGE  INVESTMENT  CONDUIT," AS THOSE
TERMS ARE  DEFINED,  RESPECTIVELY,  IN  SECTIONS  860G AND 860D OF THE  INTERNAL
REVENUE CODE OF 1986 (THE "CODE").

      UNLESS THIS  CERTIFICATE IS PRESENTED BY AN AUTHORIZED  REPRESENTATIVE  OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION  ("DTC"),  TO ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER,  EXCHANGE,  OR PAYMENT,  AND ANY CERTIFICATE
ISSUED  IS  REGISTERED  IN THE NAME OF CEDE & CO.  OR IN SUCH  OTHER  NAME AS IS
REQUESTED  BY AN  AUTHORIZED  REPRESENTATIVE  OF DTC (AND ANY PAYMENT IS MADE TO
CEDE  &  CO.  OR  TO  SUCH  OTHER  ENTITY  AS  IS  REQUESTED  BY  AN  AUTHORIZED
REPRESENTATIVE  OF DTC), ANY TRANSFER,  PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE  BY OR TO ANY PERSON IS  WRONGFUL  INASMUCH  AS THE  REGISTERED  OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

      THE FOLLOWING  INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING
THE U.S.  FEDERAL  INCOME TAX  ORIGINAL  ISSUE  DISCOUNT  ("OID")  RULES TO THIS
CERTIFICATE.  THE  ISSUE  DATE OF THIS  CERTIFICATE  IS  ___________  __,  ____.
ASSUMING  THAT THE  MORTGAGE  LOANS  PREPAY AT [___]%  OF THE  PREPAYMENT  SPEED
ASSUMPTION (AS DESCRIBED IN THE PROSPECTUS  SUPPLEMENT),  THIS  CERTIFICATE  HAS
BEEN ISSUED WITH NO MORE THAN $[____] OF OID PER $[1,000] OF INITIAL CERTIFICATE
PRINCIPAL  BALANCE,  THE YIELD TO  MATURITY  IS  [_____]%  AND THE AMOUNT OF OID
ATTRIBUTABLE  TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[____] PER $[1,000]
OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE APPROXIMATE METHOD.
NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON
THE PREPAYMENT SPEED ASSUMPTION OR AT ANY OTHER RATE.

      ANY TRANSFEREE OF THIS  CERTIFICATE  WILL BE DEEMED TO HAVE REPRESENTED BY
VIRTUE OF ITS PURCHASE OR HOLDING OF THIS  CERTIFICATE (OR INTEREST HEREIN) THAT
EITHER (A) SUCH TRANSFEREE IS NOT AN INVESTMENT  MANAGER, A NAMED FIDUCIARY OR A
TRUSTEE OF ANY PLAN, OR ANY OTHER PERSON,  ACTING,  DIRECTLY OR  INDIRECTLY,  ON
BEHALF OF OR PURCHASING ANY CERTIFICATE  WITH "PLAN ASSETS" OF ANY PLAN (A "PLAN
INVESTOR"),  (B) IT HAS ACQUIRED AND IS HOLDING SUCH  CERTIFICATE IN

<PAGE>

RELIANCE ON PROHIBITED  TRANSACTION  EXEMPTION  ("PTE") 94-29,  AS MOST RECENTLY
AMENDED,   PTE  2002-41,  67  FED.  REG.  54487  (AUGUST  22,  2002)  (THE  "RFC
EXEMPTION"),  AND THAT IT UNDERSTANDS  THAT THERE ARE CERTAIN  CONDITIONS TO THE
AVAILABILITY OF THE RFC EXEMPTION INCLUDING THAT SUCH CERTIFICATE MUST BE RATED,
AT THE TIME OF PURCHASE, NOT LOWER THAN "BBB-" (OR ITS EQUIVALENT) BY STANDARD &
POOR'S, FITCH OR MOODY'S OR (C) (I) THE TRANSFEREE IS AN INSURANCE COMPANY, (II)
THE  SOURCE  OF  FUNDS  TO BE  USED  BY IT TO  PURCHASE  THE  CERTIFICATE  IS AN
"INSURANCE  COMPANY GENERAL ACCOUNT"  (WITHIN THE MEANING OF U.S.  DEPARTMENT OF
LABOR PROHIBITED  TRANSACTION  CLASS EXEMPTION  ("PTCE")  95-60),  AND (III) THE
CONDITIONS  SET FORTH IN  SECTIONS I AND III OF PTCE  95-60 HAVE BEEN  SATISFIED
(EACH ENTITY THAT SATISFIES THIS CLAUSE (C), A "cOMPLYING INSURANCE COMPANY).

      IF THIS  CERTIFICATE  (OR ANY INTEREST  HEREIN) IS ACQUIRED OR HELD BY ANY
PERSON  THAT  DOES  NOT  SATISFY  THE  CONDITIONS  DESCRIBED  IN  THE  PRECEDING
PARAGRAPH,  THEN THE LAST  PRECEDING  TRANSFEREE  THAT  EITHER (I) IS NOT A PLAN
INVESTOR,  (II) ACQUIRED SUCH  CERTIFICATE IN COMPLIANCE WITH THE RFC EXEMPTION,
OR (III) IS A  COMPLYING  INSURANCE  COMPANY  SHALL BE  RESTORED,  TO THE EXTENT
PERMITTED BY LAW, TO ALL RIGHTS AND  OBLIGATIONS  AS  CERTIFICATE  OWNER THEREOF
RETROACTIVE TO THE DATE OF SUCH TRANSFER OF THIS CERTIFICATE.  THE TRUSTEE SHALL
BE  UNDER NO  LIABILITY  TO ANY  PERSON  FOR  MAKING  ANY  PAYMENTS  DUE ON THIS
CERTIFICATE TO SUCH PRECEDING TRANSFEREE.

      ANY  PURPORTED  CERTIFICATE  OWNER  WHOSE  ACQUISITION  OR HOLDING OF THIS
CERTIFICATE (OR INTEREST  HEREIN) WAS EFFECTED IN VIOLATION OF THE  RESTRICTIONS
IN SECTION  5.02(E) OF THE POOLING AND SERVICING  AGREEMENT  SHALL INDEMNIFY AND
HOLD HARMLESS THE COMPANY,  THE TRUSTEE,  THE MASTER SERVICER,  ANY SUBSERVICER,
AND THE TRUST FUND FROM AND AGAINST ANY AND ALL  LIABILITIES,  CLAIMS,  COSTS OR
EXPENSES INCURRED BY SUCH PARTIES AS A RESULT OF SUCH ACQUISITION OR HOLDING.

                                      B-2
<PAGE>

Certificate No. ____                   [______]% Pass-Through Rate

Class M-    Subordinate                Aggregate Certificate
                                       Principal Balance
Date of Pooling and Servicing          of the Class M Certificates:
Agreement and Cut-off Date:            $________________
___________ 1, ____
                                       Initial Certificate Principal
First Distribution Date:               Balance of this Certificate:
_________ 25, ____                     $________________

Master Servicer:                       CUSIP: 76110F-______
Residential Funding Company, LLC

Assumed Final Distribution Date:
___________ 25, ____

                 MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
                                 SERIES ____-___

      evidencing a  percentage  interest in any  distributions  allocable to the
      Class M-_ Certificates with respect to the Trust Fund consisting primarily
      of a pool of [conventional  one- to four-family  fixed interest rate first
      mortgage loans] formed and sold by RESIDENTIAL ACCREDIT LOANS, INC.

            This  Certificate  is  payable  solely  from the assets of the Trust
Fund,  and does not  represent  an  obligation  of or  interest  in  Residential
Accredit Loans, Inc., the Master Servicer, the Trustee referred to below or GMAC
Mortgage Group, LLC or any of their affiliates. Neither this Certificate nor the
underlying  Mortgage Loans are guaranteed or insured by any governmental  agency
or instrumentality or by Residential  Accredit Loans, Inc., the Master Servicer,
the Trustee or GMAC Mortgage Group, LLC or any of their affiliates.  None of the
Company,  the  Master  Servicer,  GMAC  Mortgage  Group,  LLC or  any  of  their
affiliates  will have any  obligation  with respect to any  certificate or other
obligation secured by or payable from payments on the Certificates.

            This  certifies  that  _________________________  is the  registered
owner of the  Percentage  Interest  evidenced by this  Certificate  (obtained by
dividing the Certificate  Principal Balance of this Certificate by the aggregate
Certificate  Principal  Balance of all Class M- Certificates,  both as specified
above)  in  certain  distributions  with  respect  to a  Trust  Fund  consisting
primarily of a pool of  [conventional  one- to  four-family  fixed interest rate
first  mortgage  loans] (the "Mortgage  Loans"),  formed and sold by Residential
Accredit Loans, Inc.  (hereinafter called the "Company," which term includes any
successor  entity  under the  Agreement  referred to below).  The Trust Fund was
created  pursuant to a Pooling and Servicing  Agreement dated as specified above
(the "Agreement") among the Company, the Master Servicer and __________________,
as trustee (the "Trustee"),  a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the

                                      B-3
<PAGE>

capitalized terms used herein have the meanings assigned in the Agreement.  This
Certificate  is  issued  under  and is  subject  to the  terms,  provisions  and
conditions of the Agreement,  to which Agreement the Holder of this  Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

            Pursuant to the terms of the Agreement,  a distribution will be made
on the 25th day of each  month or, if such 25th day is not a Business  Day,  the
Business Day  immediately  following (the  "Distribution  Date"),  commencing as
described  in the  Agreement,  to the Person in whose name this  Certificate  is
registered  at the close of business on the last day (or if such last day is not
a Business  Day, the Business Day  immediately  preceding  such last day) of the
month immediately  preceding the month of such distribution (the "Record Date"),
from the Available  Distribution Amount in an amount equal to the product of the
Percentage  Interest  evidenced by this  Certificate and the amount (of interest
and  principal,  if any)  required  to be  distributed  to  Holders  of Class M-
Certificates on such Distribution Date.

            Distributions  on this Certificate will be made either by the Master
Servicer  acting on behalf of the Trustee or by a Paying Agent  appointed by the
Trustee in immediately  available  funds (by wire transfer or otherwise) for the
account of the Person entitled thereto if such Person shall have so notified the
Master  Servicer or such Paying Agent,  or by check mailed to the address of the
Person  entitled  thereto,  as  such  name  and  address  shall  appear  on  the
Certificate Register.

            Notwithstanding   the  above,   the  final   distribution   on  this
Certificate  will be made after due notice of the pendency of such  distribution
and only upon  presentation  and surrender of this  Certificate at the office or
agency  appointed  by the Trustee  for that  purpose.  The  Initial  Certificate
Principal  Balance  of this  Certificate  is set forth  above.  The  Certificate
Principal  Balance  hereof  will be reduced  to the extent of the  distributions
allocable to principal and any Realized Losses allocable hereto.

            Any  transferee  of  this   Certificate   will  be  deemed  to  have
represented  by  virtue of its  purchase  or  holding  of this  Certificate  (or
interest herein) that either (a) such transferee is not an investment manager, a
named fiduciary or a trustee of any plan, or any other person, acting,  directly
or indirectly,  on behalf of or purchasing any Certificate with "plan assets" of
any  plan  (a  "plan  investor"),  (b)  it has  acquired  and  is  holding  such
Certificate in reliance on prohibited  transaction  exemption  ("PTE") 94-29, as
most recently  amended,  PTE 2002-41,  67 fed. Reg. 54487 (August 22, 2002) (the
"RFC Exemption"),  and that it understands that there are certain  conditions to
the  availability of the RFC Exemption  including that such  Certificate must be
rated,  at the time of purchase,  not lower than "BBB-" (or its  equivalent)  by
Standard & Poor's,  Fitch or Moody's or (c) (i) the  transferee  is an insurance
company,  (ii) the source of funds to be used by it to purchase the  Certificate
is an "insurance company general account" (within the meaning of U.S. Department
of Labor prohibited  transaction class exemption  ("PTCE") 95-60), and (iii) the
conditions  set forth in  Sections I and III of PTCE  95-60 have been  satisfied
(each entity that satisfies this clause (c), a "complying insurance company).

            If this  Certificate (or any interest herein) is acquired or held by
any person that does not  satisfy  the  conditions  described  in the  preceding
paragraph,  then the last  preceding  transferee  that  either (i) is not a plan
investor, (ii) acquired such Certificate in compliance with

                                      B-4
<PAGE>

the RFC Exemption,  or (iii) is a complying insurance company shall be restored,
to the extent  permitted by law, to all rights and  obligations  as  Certificate
owner thereof retroactive to the date of such transfer of this Certificate.  The
Trustee shall be under no liability to any person for making any payments due on
this Certificate to such preceding transferee.

            This  Certificate is one of a duly authorized  issue of Certificates
issued in several  Classes  designated  as  Mortgage  Asset-Backed  Pass-Through
Certificates  of the Series  specified  hereon (herein  collectively  called the
"Certificates").

            The  Certificates  are  limited  in  right  of  payment  to  certain
collections  and  recoveries   respecting  the  Mortgage  Loans,   all  as  more
specifically set forth herein and in the Agreement. In the event Master Servicer
funds  are  advanced  with  respect  to  any  Mortgage  Loan,  such  advance  is
reimbursable  to the Master  Servicer,  to the extent provided in the Agreement,
from related recoveries on such Mortgage Loan or from other cash that would have
been distributable to Certificateholders.

            As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the  Master  Servicer  from  time to time  for  purposes  other  than
distributions to Certificateholders,  such purposes including without limitation
reimbursement  to the Company  and the Master  Servicer  of  advances  made,  or
certain expenses incurred, by either of them.

            The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the  Company,  the  Master  Servicer  and  the  Trustee  and the  rights  of the
Certificateholders  under the  Agreement at any time by the Company,  the Master
Servicer  and the  Trustee  with the  consent  of the  Holders  of  Certificates
evidencing  in the aggregate  not less than 66% of the  Percentage  Interests of
each Class of Certificates  affected thereby.  Any such consent by the Holder of
this  Certificate  shall be  conclusive  and binding on such Holder and upon all
future  holders  of this  Certificate  and of any  Certificate  issued  upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the  Certificate.  The  Agreement  also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain  additional  circumstances,  without the
consent of the Holders of certain Classes of Certificates.

            As provided  in the  Agreement  and  subject to certain  limitations
therein  set forth,  the  transfer of this  Certificate  is  registrable  in the
Certificate  Register upon surrender of this  Certificate  for  registration  of
transfer at the offices or agencies appointed by the Trustee,  duly endorsed by,
or accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Trustee and the Certificate  Registrar duly
executed by the Holder  hereof or such  Holder's  attorney  duly  authorized  in
writing, and thereupon one or more new Certificates of authorized  denominations
evidencing  the same Class and aggregate  Percentage  Interest will be issued to
the designated transferee or transferees.

            The  Certificates  are  issuable  only  as  registered  Certificates
without coupons in Classes and in denominations  specified in the Agreement.  As
provided in the Agreement and subject to certain  limitations therein set forth,
Certificates are exchangeable for new Certificates

                                      B-5
<PAGE>

of authorized  denominations  evidencing the same Class and aggregate Percentage
Interest, as requested by the Holder surrendering the same.

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

            The Company,  the Master  Servicer,  the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer,  the Trustee or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered  as the owner hereof for all purposes,  and neither the Company,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

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

            The  obligations   created  by  the  Agreement  in  respect  of  the
Certificates and the Trust Fund created thereby shall terminate upon the payment
to  Certificateholders  of all  amounts  held by or on behalf of the Trustee and
required to be paid to them pursuant to the  Agreement  following the earlier of
(i) the maturity or other  liquidation of the last Mortgage Loan subject thereto
or the disposition of all property  acquired upon foreclosure or deed in lieu of
foreclosure  of any Mortgage  Loan and (ii) the purchase by the Master  Servicer
from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such  Mortgage  Loans,  thereby  effecting  early  retirement  of the
Certificates.  The Agreement permits,  but does not require, the Master Servicer
to (i) purchase at a price determined as provided in the Agreement all remaining
Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
purchase in whole,  but not in part,  all of the  Certificates  from the Holders
thereof; provided, that any such option may only be exercised if the Pool Stated
Principal  Balance of the Mortgage Loans as of the Distribution  Date upon which
the proceeds of any such  purchase are  distributed  is less than ten percent of
the Cut-off Date Principal Balance of the Mortgage Loans.

            Unless the certificate of authentication hereon has been executed by
the Certificate  Registrar,  by manual signature,  this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.

                                      B-6
<PAGE>

            IN WITNESS  WHEREOF,  the Trustee has caused this  Certificate to be
duly executed.

Dated:                                [____________________________],
                                      as Trustee

                                      By: ___________________________
                                          Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

            This  is  one  of  the  Class  M-  Certificates  referred  to in the
within-mentioned Agreement.

                                      [_________________________],
                                           as Certificate Registrar

                                      By: ___________________________
                                          Authorized Signatory

                                      B-7
<PAGE>

                                   ASSIGNMENT

            FOR VALUE RECEIVED,  the undersigned  hereby sell(s),  assign(s) and
transfer(s)  unto  _____________________  (Please  print or  typewrite  name and
address including postal zip code of assignee) a Percentage  Interest  evidenced
by  the  within  Mortgage  Asset-Backed   Pass-Through  Certificate  and  hereby
authorizes  the  transfer of  registration  of such  interest to assignee on the
Certificate Register of the Trust Fund.

            I (We)  further  direct  the  Certificate  Registrar  to issue a new
Certificate of a like  denomination  and Class,  to the above named assignee and
deliver such Certificate to the following address:

Dated:                                _____________________________________
                                      Signature by or on behalf of assignor

                                      _____________________________________
                                          Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

            The  assignee   should   include  the   following  for  purposes  of
distribution:

            Distributions  shall be made,  by wire  transfer  or  otherwise,  in
immediately   available  funds  to   ___________________   for  the  account  of
____________________account    number __,   or,   if   mailed   by   check,   to
_________________________    Applicable   statements   should   be   mailed   to
____________________.

            This  information  is provided by  _______________________________,
the assignee named above, or ______, as its agent.

<PAGE>

                                    EXHIBIT C

                           FORM OF CLASS B CERTIFICATE

THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR  CERTIFICATES
AND CLASS M CERTIFICATES [AND CLASS B-1] [CLASS B-2  CERTIFICATES]  DESCRIBED IN
THE AGREEMENT (AS DEFINED HEREIN).

THIS  CERTIFICATE  HAS NOT BEEN AND WILL NOT BE REGISTERED  UNDER THE SECURITIES
ACT OF 1933,  AS  AMENDED,  OR THE  SECURITIES  LAWS OF ANY STATE AND MAY NOT BE
RESOLD OR TRANSFERRED  UNLESS IT IS REGISTERED  PURSUANT TO SUCH ACT AND LAWS OR
IS SOLD OR TRANSFERRED IN TRANSACTIONS  WHICH ARE EXEMPT FROM REGISTRATION UNDER
SUCH ACT AND UNDER  APPLICABLE  STATE LAW AND IS TRANSFERRED IN ACCORDANCE  WITH
THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT.

NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF THE AGREEMENT OR
AN OPINION OF COUNSEL  SATISFACTORY  TO THE  TRUSTEE  THAT THE  PURCHASE OF THIS
CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION
UNDER  SECTION 406 OF THE EMPLOYEE  RETIREMENT  INCOME  SECURITY ACT OF 1974, AS
AMENDED  ("ERISA"),  OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE MASTER
SERVICER,  THE COMPANY OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY IN ADDITION
TO THOSE UNDERTAKEN IN THE AGREEMENT.

SOLELY FOR U.S.  FEDERAL  INCOME TAX PURPOSES,  THIS  CERTIFICATE  IS A "REGULAR
INTEREST" IN A "REAL  ESTATE  MORTGAGE  INVESTMENT  CONDUIT," AS THOSE TERMS ARE
DEFINED,  RESPECTIVELY,  IN SECTIONS  860G AND 860D OF THE CODE.  THE  FOLLOWING
INFORMATION  IS PROVIDED  SOLELY FOR THE PURPOSES OF APPLYING  THE U.S.  FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.  THE ISSUE
DATE OF THIS  CERTIFICATE  IS ___________  __, ____.  ASSUMING THAT THE MORTGAGE
LOANS PREPAY AT 100% OF THE  PREPAYMENT  SPEED  ASSUMPTION  (AS DESCRIBED IN THE
PROSPECTUS  SUPPLEMENT),  THIS  CERTIFICATE  HAS BEEN  ISSUED  WITH NO MORE THAN
$[____] OF OID PER $[1,000] OF INITIAL CERTIFICATE  PRINCIPAL BALANCE, THE YIELD
TO MATURITY  IS __% AND THE AMOUNT OF OID  ATTRIBUTABLE  TO THE INITIAL  ACCRUAL
PERIOD IS NO MORE THAN  $[____] PER  $[1,000] OF INITIAL  CERTIFICATE  PRINCIPAL
BALANCE,  COMPUTED UNDER THE APPROXIMATE  METHOD. NO REPRESENTATION IS MADE THAT
THE  MORTGAGE  LOANS  WILL  PREPAY  AT A  RATE  BASED  ON THE  PREPAYMENT  SPEED
ASSUMPTION OR AT ANY OTHER RATE.

<PAGE>

Certificate No. ____                     [______]% Pass-Through Rate

Class B-__ Subordinate                   Aggregate Certificate
                                         Principal Balance
Date of Pooling and Servicing            of the Class B-___
Agreement and Cut-off Date:              Certificates as of
___________ 1, ____                      the Cut-off Date:
                                         $________________
First Distribution Date:
_________ 25, ____                       Initial Certificate Principal
                                         Balance of this Certificate:
Master Servicer:                         $________________
Residential Funding Company, LLC

Assumed Final Distribution Date:
___________ 25, ____

                 MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
                                 SERIES ____-___

        evidencing a percentage  interest in any distributions  allocable to the
        Class  B-  Certificates  with  respect  to  the  Trust  Fund  consisting
        primarily of a pool of [conventional  one- to four-family fixed interest
        rate  first  mortgage  loans]  formed and sold by  RESIDENTIAL  ACCREDIT
        LOANS, INC.

            This  Certificate  is  payable  solely  from the assets of the Trust
Fund,  and does not  represent  an  obligation  of or  interest  in  Residential
Accredit Loans, Inc., the Master Servicer, the Trustee referred to below or GMAC
Mortgage Group, LLC or any of their affiliates. Neither this Certificate nor the
underlying  Mortgage Loans are guaranteed or insured by any governmental  agency
or instrumentality or by Residential  Accredit Loans, Inc., the Master Servicer,
the Trustee or GMAC Mortgage Group, LLC or any of their affiliates.  None of the
Company,  the  Master  Servicer,  GMAC  Mortgage  Group,  LLC or  any  of  their
affiliates  will have any  obligation  with respect to any  certificate or other
obligation secured by or payable from payments on the Certificates.

            This  certifies  that  Residential   Accredit  Loans,  Inc.  is  the
registered  owner  of the  Percentage  Interest  evidenced  by this  Certificate
(obtained by dividing the Certificate  Principal  Balance of this Certificate by
the aggregate Certificate  Principal Balance of all Class B- Certificates,  both
as  specified  above) in  certain  distributions  with  respect  to a Trust Fund
consisting  primarily  of a pool  of  [conventional  one- to  four-family  fixed
interest rate first mortgage loans] (the "Mortgage  Loans"),  formed and sold by
Residential  Accredit Loans, Inc.  (hereinafter called the "Company," which term
includes any successor entity under the Agreement  referred to below). The Trust
Fund  was  created  pursuant  to a  Pooling  and  Servicing  Agreement  dated as
specified  above (the  "Agreement")  among the Company,  the Master Servicer and
__________________,  as  trustee  (the  "Trustee"),  a summary of certain of the
pertinent provisions of which is set forth hereafter.  To the extent not defined
herein, the

                                      C-2
<PAGE>

capitalized terms used herein have the meanings assigned in the Agreement.  This
Certificate  is  issued  under  and is  subject  to the  terms,  provisions  and
conditions of the Agreement,  to which Agreement the Holder of this  Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.

            Pursuant to the terms of the Agreement,  a distribution will be made
on the 25th day of each  month or, if such 25th day is not a Business  Day,  the
Business Day immediately following (the "Distribution Date"),  commencing on the
first  Distribution  Date  specified  above,  to the  Person in whose  name this
Certificate  is  registered at the close of business on the last day (or if such
last day is not a Business Day, the Business Day immediately preceding such last
day) of the month next  preceding  the month of such  distribution  (the "Record
Date"), from the Available Distribution Amount in an amount equal to the product
of the  Percentage  Interest  evidenced by this  Certificate  and the amount (of
interest and principal, if any) required to be distributed to Holders of Class B
Certificates on such Distribution Date.

            Distributions  on this Certificate will be made either by the Master
Servicer  acting on behalf of the Trustee or by a Paying Agent  appointed by the
Trustee in immediately  available  funds (by wire transfer or otherwise) for the
account of the Person entitled thereto if such Person shall have so notified the
Master  Servicer or such Paying Agent,  or by check mailed to the address of the
Person  entitled  thereto,  as  such  name  and  address  shall  appear  on  the
Certificate Register.

            Notwithstanding   the  above,   the  final   distribution   on  this
Certificate  will be made after due notice of the pendency of such  distribution
and only upon  presentation  and surrender of this  Certificate at the office or
agency  appointed  by the Trustee  for that  purpose.  The  Initial  Certificate
Principal  Balance  of this  Certificate  is set forth  above.  The  Certificate
Principal  Balance  hereof  will be reduced  to the extent of the  distributions
allocable to principal and any Realized Losses allocable hereto.

            No  transfer  of this Class B  Certificate  will be made unless such
transfer is exempt from the  registration  requirements of the Securities Act of
1933,  as  amended,  and  any  applicable  state  securities  laws or is made in
accordance  with said Act and laws.  In the event that such a transfer  is to be
made,  (i) the  Trustee  or the  Company  may  require  an  opinion  of  counsel
acceptable  to and in form and  substance  satisfactory  to the  Trustee and the
Company that such transfer is exempt  (describing  the applicable  exemption and
the  basis  therefor)  from  or is  being  made  pursuant  to  the  registration
requirements  of the Securities  Act of 1933, as amended,  and of any applicable
statute of any state and (ii) the transferee shall execute an investment  letter
in the form  described by the  Agreement.  The Holder hereof  desiring to effect
such  transfer  shall,  and does hereby agree to,  indemnify  the  Trustee,  the
Company,  the Master Servicer and the Certificate  Registrar acting on behalf of
the Trustee  against  any  liability  that may result if the  transfer is not so
exempt  or is not made in  accordance  with such  Federal  and  state  laws.  In
connection  with any such transfer,  the Trustee will also require either (i) an
opinion  of  counsel  addressed  to the  Trustee,  the  Company  and the  Master
Servicer,  acceptable to and in form and substance  satisfactory  to the Trustee
with  respect  to  the  permissibility  of  such  transfer  under  the  Employee
Retirement Income Security Act of 1974, as amended  ("ERISA"),  and Section 4975
of the Internal Revenue Code (the "Code") and stating,  among other things, that
the  transferee's  acquisition  of a Class B Certificate  will not constitute or
result in a non-exempt prohibited

                                      C-3
<PAGE>

transaction  under  Section  406 of ERISA or Section  4975 of the Code or (ii) a
representation  letter,  in the form as  described  by  Section  5.02(e)  of the
Agreement,  either  stating that the  transferee  is not an employee  benefit or
other plan subject to the prohibited  transaction provisions of ERISA or Section
4975 of the Code (a  "Plan"),  or any  other  person  (including  an  investment
manager,  a named  fiduciary  or a trustee  of any  Plan)  acting,  directly  or
indirectly, on behalf of or purchasing any Certificate with "plan assets" of any
Plan,  or stating that the  transferee  is an insurance  company,  the source of
funds to be used by it to purchase  the  Certificate  is an  "insurance  company
general   account"  (within  the  meaning  of  Department  of  Labor  Prohibited
Transaction Class Exemption  ("PTCE") 95-60),  and the purchase is being made in
reliance upon the availability of the exemptive relief afforded under Sections I
and III of PTCE 95-60.

            This  Certificate is one of a duly authorized  issue of Certificates
issued in several  Classes  designated  as  Mortgage  Asset-Backed  Pass-Through
Certificates  of the Series  specified  hereon (herein  collectively  called the
"Certificates").

            The  Certificates  are  limited  in  right  of  payment  to  certain
collections  and  recoveries   respecting  the  Mortgage  Loans,   all  as  more
specifically set forth herein and in the Agreement. In the event Master Servicer
funds  are  advanced  with  respect  to  any  Mortgage  Loan,  such  advance  is
reimbursable  to the Master  Servicer,  to the extent provided in the Agreement,
from related recoveries on such Mortgage Loan or from other cash that would have
been distributable to Certificateholders.

            As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the  Master  Servicer  from  time to time  for  purposes  other  than
distributions to Certificateholders,  such purposes including without limitation
reimbursement  to the Company  and the Master  Servicer  of  advances  made,  or
certain expenses incurred, by either of them.

            The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the  Company,  the  Master  Servicer  and  the  Trustee  and the  rights  of the
Certificateholders  under the  Agreement at any time by the Company,  the Master
Servicer  and the  Trustee  with the  consent  of the  Holders  of  Certificates
evidencing  in the aggregate  not less than 66% of the  Percentage  Interests of
each Class of Certificates  affected thereby.  Any such consent by the Holder of
this  Certificate  shall be  conclusive  and binding on such Holder and upon all
future  holders  of this  Certificate  and of any  Certificate  issued  upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the  Certificate.  The  Agreement  also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain  additional  circumstances,  without the
consent of the Holders of certain Classes of Certificates.

            As provided  in the  Agreement  and  subject to certain  limitations
therein  set forth,  the  transfer of this  Certificate  is  registrable  in the
Certificate  Register upon surrender of this  Certificate  for  registration  of
transfer at the offices or agencies appointed by the Trustee,  duly endorsed by,
or accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Trustee and the Certificate  Registrar duly
executed by the

                                      C-4
<PAGE>

Holder  hereof  or such  Holder's  attorney  duly  authorized  in  writing,  and
thereupon one or more new  Certificates of authorized  denominations  evidencing
the  same  Class  and  aggregate  Percentage  Interest  will  be  issued  to the
designated transferee or transferees.

            The  Certificates  are  issuable  only  as  registered  Certificates
without coupons in Classes and in denominations  specified in the Agreement.  As
provided in the Agreement and subject to certain  limitations therein set forth,
Certificates are  exchangeable for new Certificates of authorized  denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

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

            The Company,  the Master  Servicer,  the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer,  the Trustee or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered  as the owner hereof for all purposes,  and neither the Company,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

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

            The  obligations   created  by  the  Agreement  in  respect  of  the
Certificates and the Trust Fund created thereby shall terminate upon the payment
to  Certificateholders  of all  amounts  held by or on behalf of the Trustee and
required to be paid to them pursuant to the  Agreement  following the earlier of
(i) the maturity or other  liquidation of the last Mortgage Loan subject thereto
or the disposition of all property  acquired upon foreclosure or deed in lieu of
foreclosure  of any Mortgage  Loan and (ii) the purchase by the Master  Servicer
from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such  Mortgage  Loans,  thereby  effecting  early  retirement  of the
Certificates.  The Agreement permits,  but does not require, the Master Servicer
to (i) purchase at a price determined as provided in the Agreement all remaining
Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
purchase in whole,  but not in part,  all of the  Certificates  from the Holders
thereof; provided, that any such option may only be exercised if the Pool Stated
Principal  Balance of the Mortgage Loans as of the Distribution  Date upon which
the proceeds of any such  purchase are  distributed  is less than ten percent of
the Cut-off Date Principal Balance of the Mortgage Loans.

            Unless the certificate of authentication hereon has been executed by
the Certificate  Registrar,  by manual signature,  this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.

                                      C-5
<PAGE>

            IN WITNESS  WHEREOF,  the Trustee has caused this  Certificate to be
duly executed.

Dated:                                [_____________________________],
                                         as Trustee

                                      By: __________________________
                                          Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

            This  is  one  of  the  Class  B-  Certificates  referred  to in the
within-mentioned Agreement.

                                      [___________________________],
                                          as Certificate Registrar

                                      By: __________________________
                                          Authorized Signatory

                                      C-6
<PAGE>

                                   ASSIGNMENT

            FOR VALUE RECEIVED,  the undersigned  hereby sell(s),  assign(s) and
transfer(s)  unto  ____________________________  (Please print or typewrite name
and  address  including  postal  zip code of  assignee)  a  Percentage  Interest
evidenced  by the within  Mortgage  Asset-Backed  Pass-Through  Certificate  and
hereby  authorizes the transfer of  registration of such interest to assignee on
the Certificate Register of the Trust Fund.

            I (We)  further  direct  the  Certificate  Registrar  to issue a new
Certificate of a like  denomination  and Class,  to the above named assignee and
deliver such Certificate to the following address:

Dated:                                _______________________________________
                                      Signature by or on behalf of assignor

                                      _______________________________________
                                          Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

            The  assignee   should   include  the   following  for  purposes  of
distribution:

            Distributions  shall be made,  by wire  transfer  or  otherwise,  in
immediately  available  funds  to  _____________________   for  the  account  of
_______________________  account number  __________,  or, if mailed by check, to
____________________    Applicable    statements    should    be    mailed    to
_____________________.

            This  information  is  provided  by  _________________________,  the
assignee named above, or ______, as its agent.

<PAGE>

                                   EXHIBIT C-I

                           FORM OF CLASS P CERTIFICATE

THIS  CERTIFICATE  HAS NOT BEEN AND WILL NOT BE REGISTERED  UNDER THE SECURITIES
ACT OF 1933,  AS  AMENDED,  OR THE  SECURITIES  LAWS OF ANY STATE AND MAY NOT BE
RESOLD OR TRANSFERRED  UNLESS IT IS REGISTERED  PURSUANT TO SUCH ACT AND LAWS OR
IS SOLD OR TRANSFERRED IN TRANSACTIONS  WHICH ARE EXEMPT FROM REGISTRATION UNDER
SUCH ACT AND UNDER  APPLICABLE  STATE LAW AND IS TRANSFERRED IN ACCORDANCE  WITH
THE PROVISIONS OF SECTION 5.02 OF THE AGREEMENT).

NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF THE AGREEMENT OR
AN OPINION OF COUNSEL  SATISFACTORY TO THE THE TRUSTEE THAT THE PURCHASE OF THIS
CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION
UNDER  SECTION 406 OF THE EMPLOYEE  RETIREMENT  INCOME  SECURITY ACT OF 1974, AS
AMENDED  ("ERISA"),  OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE MASTER
SERVICER,  THE COMPANY OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY IN ADDITION
TO THOSE UNDERTAKEN IN THE AGREEMENT.

<PAGE>

Certificate No. ___                     Prepayment Charge

Class P - Prepayment Charge             Aggregate Certificate Principal Balance
                                        of the Class P
Date of Pooling and Servicing           Certificates as of
Agreement and Cut-off Date:             the Cut-off Date:
__________ 1, ____                      $0.00

First Distribution Date:                Initial Certificate Principal Balance of
__________ 25, ____                      this Certificate: $____

Master Servicer:                        Percentage Interest of this Certificate:
Residential Funding Company, LLC        100%

Assumed Final Distribution Date:        CUSIP: __________
__________ 25, ____

                 MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
                                 SERIES ____-___

        evidencing a percentage  interest in any distributions  allocable to the
        Class P Certificates with respect to the Trust Fund consisting primarily
        of  a  pool  of  [one-  to  four-family   residential,   payment-option,
        adjustable-rate  first lien mortgage loans with a negative  amortization
        feature] formed and sold by RESIDENTIAL ACCREDIT LOANS, INC.

            This  Certificate  is  payable  solely  from the assets of the Trust
Fund,  and does not  represent  an  obligation  of or  interest  in  Residential
Accredit Loans, Inc., the Master Servicer, the Trustee referred to below or GMAC
Mortgage Group, LLC or any of their affiliates. Neither this Certificate nor the
underlying  Mortgage Loans are guaranteed or insured by any governmental  agency
or instrumentality or by Residential  Accredit Loans, Inc., the Master Servicer,
the Trustee or GMAC Mortgage Group, LLC or any of their affiliates.  None of the
Company,  the  Master  Servicer,  GMAC  Mortgage  Group,  LLC or  any  of  their
affiliates  will have any  obligation  with respect to any  certificate or other
obligation secured by or payable from payments on the Certificates.

            This certifies that  ____________________________  is the registered
owner of the Percentage  Interest  evidenced by this  Certificate  (as specified
above)  in  certain  distributions  with  respect  to a  Trust  Fund  consisting
primarily  of a  pool  of  [one-  to  four-family  residential,  payment-option,
adjustable-rate  first lien mortgage loans with a negative amortization feature]
(the "Mortgage  Loans"),  formed and sold by Residential  Accredit  Loans,  Inc.
(hereinafter  called the  "Company,"  which term includes any  successor  entity
under the Agreement referred to below). The Trust Fund was created pursuant to a
Pooling and Servicing Agreement dated as specified above (the "Agreement") among
the  Company,  the Master  Servicer  and  ____________________,  as trustee (the
"Trustee"),  a summary of certain of the  pertinent  provisions  of which is set
forth hereafter. To the extent not defined herein, the capitalized terms

                                     C-1-2
<PAGE>

used herein have the meanings  assigned in the  Agreement.  This  Certificate is
issued  under and is subject  to the terms,  provisions  and  conditions  of the
Agreement,  to which  Agreement the Holder of this  Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.

            Pursuant to the terms of the Agreement,  a distribution will be made
on the 25th day of each  month or, if such 25th day is not a Business  Day,  the
Business Day immediately following (the "Distribution Date"),  commencing on the
first  Distribution  Date  specified  above,  to the  Person in whose  name this
Certificate at the close of business on the last day (or if such last day is not
a Business  Day, the Business Day  immediately  preceding  such last day) of the
month immediately  preceding the month of such distribution (the "Record Date"),
in an amount equal to the product of the Percentage  Interest  evidenced by this
Certificate  and the amount  required  to be  distributed  to Holders of Class P
Certificates on such Distribution Date.

            Distributions  on this Certificate will be made either by the Master
Servicer  acting on behalf of the Trustee or by a Paying Agent  appointed by the
Trustee in immediately  available  funds (by wire transfer or otherwise) for the
account of the Person entitled thereto if such Person shall have so notified the
Master  Servicer or such Paying Agent,  or by check mailed to the address of the
Person  entitled  thereto,  as  such  name  and  address  shall  appear  on  the
Certificate Register.

            Notwithstanding   the  above,   the  final   distribution   on  this
Certificate  will be made after due notice of the pendency of such  distribution
and only upon  presentation  and surrender of this  Certificate at the office or
agency appointed by the Trustee for that purpose.

            No  transfer  of this Class P  Certificate  will be made unless such
transfer is exempt from the  registration  requirements of the Securities Act of
1933,  as  amended,  and  any  applicable  state  securities  laws or is made in
accordance  with said Act and laws.  In the event that such a transfer  is to be
made,  (i) the  Trustee  or the  Company  may  require  an  opinion  of  counsel
acceptable  to and in form and  substance  satisfactory  to the  Trustee and the
Company that such transfer is exempt  (describing  the applicable  exemption and
the  basis  therefor)  from  or is  being  made  pursuant  to  the  registration
requirements  of the Securities  Act of 1933, as amended,  and of any applicable
statute of any state and (ii) the transferee shall execute an investment  letter
in the form  described by the  Agreement.  The Holder hereof  desiring to effect
such  transfer  shall,  and does hereby agree to,  indemnify  the  Trustee,  the
Company,  the Master Servicer and the Certificate  Registrar acting on behalf of
the Trustee  against  any  liability  that may result if the  transfer is not so
exempt  or is not made in  accordance  with such  Federal  and  state  laws.  In
connection  with any such transfer,  the Trustee will also require either (i) an
opinion  of  counsel  addressed  to the  Trustee,  the  Company  and the  Master
Servicer,  acceptable to and in form and substance  satisfactory  to the Trustee
with  respect  to  the  permissibility  of  such  transfer  under  the  Employee
Retirement Income Security Act of 1974, as amended  ("ERISA"),  and Section 4975
of the Internal Revenue Code (the "Code") and stating,  among other things, that
the  transferee's  acquisition  of a Class P Certificate  will not constitute or
result in a  non-exempt  prohibited  transaction  under  Section 406 of ERISA or
Section  4975 of the  Code  or  (ii) a  representation  letter,  in the  form as
described  by  Section  5.02(e)  of  the  Agreement,  either  stating  that  the
transferee  is not an employee  benefit or other plan subject to the  prohibited
transaction  provisions of ERISA or Section 4975 of the Code (a "Plan"),  or any
other person (including an

                                     C-1-3
<PAGE>

investment manager, a named fiduciary or a trustee of any Plan) acting, directly
or indirectly,  on behalf of or purchasing any Certificate with "plan assets" of
any Plan.

            This  Certificate is one of a duly authorized  issue of Certificates
issued in several  Classes  designated  as  Mortgage  Asset-Backed  Pass-Through
Certificates  of the Series  specified  hereon (herein  collectively  called the
"Certificates").

            The  Certificates  are  limited  in  right  of  payment  to  certain
collections  and  recoveries   respecting  the  Mortgage  Loans,   all  as  more
specifically set forth herein and in the Agreement. In the event Master Servicer
funds  are  advanced  with  respect  to  any  Mortgage  Loan,  such  advance  is
reimbursable  to the Master  Servicer,  to the extent provided in the Agreement,
from related recoveries on such Mortgage Loan or from other cash that would have
been distributable to Certificateholders.

            As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the  Master  Servicer  from  time to time  for  purposes  other  than
distributions to Certificateholders,  such purposes including without limitation
reimbursement  to the Company  and the Master  Servicer  of  advances  made,  or
certain expenses incurred, by either of them.

            The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the  Company,  the  Master  Servicer  and  the  Trustee  and the  rights  of the
Certificateholders  under the  Agreement at any time by the Company,  the Master
Servicer  and the  Trustee  with the  consent  of the  Holders  of  Certificates
evidencing  in the aggregate  not less than 66% of the  Percentage  Interests of
each Class of Certificates  affected thereby.  Any such consent by the Holder of
this  Certificate  shall be  conclusive  and binding on such Holder and upon all
future  holders  of this  Certificate  and of any  Certificate  issued  upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the  Certificate.  The  Agreement  also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain  additional  circumstances,  without the
consent of the Holders of certain Classes of Certificates.

            As provided  in the  Agreement  and  subject to certain  limitations
therein  set forth,  the  transfer of this  Certificate  is  registrable  in the
Certificate  Register upon surrender of this  Certificate  for  registration  of
transfer at the offices or agencies appointed by the Trustee,  duly endorsed by,
or accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Trustee and the Certificate  Registrar duly
executed by the Holder  hereof or such  Holder's  attorney  duly  authorized  in
writing, and thereupon one or more new Certificates of authorized  denominations
evidencing  the same Class and aggregate  Percentage  Interest will be issued to
the designated transferee or transferees.

            The  Certificates  are  issuable  only  as  registered  Certificates
without coupons in Classes and in denominations  specified in the Agreement.  As
provided in the Agreement and subject to certain  limitations therein set forth,
Certificates are  exchangeable for new Certificates of authorized  denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

                                     C-1-4
<PAGE>

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

            The Company,  the Master  Servicer,  the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer,  the Trustee or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered  as the owner hereof for all purposes,  and neither the Company,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

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

            The  obligations   created  by  the  Agreement  in  respect  of  the
Certificates and the Trust Fund created thereby shall terminate upon the payment
to  Certificateholders  of all  amounts  held by or on behalf of the Trustee and
required to be paid to them pursuant to the  Agreement  following the earlier of
(i) the maturity or other  liquidation of the last Mortgage Loan subject thereto
or the disposition of all property  acquired upon foreclosure or deed in lieu of
foreclosure  of any Mortgage  Loan and (ii) the purchase by the Master  Servicer
from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such  Mortgage  Loans,  thereby  effecting  early  retirement  of the
Certificates.  The Agreement permits,  but does not require, the Master Servicer
to (i) purchase at a price determined as provided in the Agreement all remaining
Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
purchase in whole,  but not in part,  all of the  Certificates  from the Holders
thereof; provided, that any such option may only be exercised if the Pool Stated
Principal  Balance of the Mortgage Loans as of the Distribution  Date upon which
the proceeds of any such  purchase are  distributed  is less than ten percent of
the Cut-off Date Principal Balance of the Mortgage Loans.

            Unless the certificate of authentication hereon has been executed by
the Certificate  Registrar,  by manual signature,  this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.

                                     C-1-5
<PAGE>

      IN WITNESS  WHEREOF,  the Trustee has caused this  Certificate  to be duly
executed.

Dated: _______________               [____________________________],
                                                as Trustee

                                      By: __________________________
                                          Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

      This  is  one  of  the   Class   P   Certificates   referred   to  in  the
within-mentioned Agreement.

                                      [____________________________],
                                            as Certificate Registrar

                                      By:______________________________
                                            Authorized Signatory

                                     C-1-6
<PAGE>

                                   ASSIGNMENT

            FOR VALUE RECEIVED,  the undersigned  hereby sell(s),  assign(s) and
transfer(s) unto  _________________________  (Please print or typewrite name and
address including postal zip code of assignee) a Percentage  Interest  evidenced
by  the  within  Mortgage  Asset-Backed   Pass-Through  Certificate  and  hereby
authorizes  the  transfer of  registration  of such  interest to assignee on the
Certificate Register of the Trust Fund.

            I (We)  further  direct  the  Certificate  Registrar  to issue a new
Certificate of a like  denomination  and Class,  to the above named assignee and
deliver such Certificate to the following address:

Dated:                                ________________________________________
                                      Signature by or on behalf of assignor

                                      ________________________________________
                                          Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

            The  assignee   should   include  the   following  for  purposes  of
distribution:

            Distributions  shall be made,  by wire  transfer  or  otherwise,  in
immediately  available funds to  ___________________________  for the account of
_______________________  account number  __________,  or, if mailed by check, to
__________________     Applicable     statements    should    be    mailed    to
_____________________________.

            This  information is provided by  ____________________________,  the
assignee named above, or ________________, as its agent.

<PAGE>

                                  EXHIBIT C-II

                            CLASS SB-[ ] CERTIFICATE

      THIS  CERTIFICATE  IS  SUBORDINATED  IN RIGHT  OF  PAYMENT  TO THE  SENIOR
CERTIFICATES,  THE CLASS M-1, CLASS M-2, CLASS M-3, [CLASS M-4, CLASS M-5, CLASS
M-6, CLASS M-7, CLASS M-8, CLASS M-9 AND CLASS M-10]  CERTIFICATES  AS DESCRIBED
IN THE AGREEMENT (AS DEFINED HEREIN).

      SOLELY  FOR U.S.  FEDERAL  INCOME  TAX  PURPOSES,  THIS  CERTIFICATE  IS A
"REGULAR  INTEREST" IN A "REAL  ESTATE  MORTGAGE  INVESTMENT  CONDUIT," AS THOSE
TERMS ARE  DEFINED,  RESPECTIVELY,  IN  SECTIONS  860G AND 860D OF THE  INTERNAL
REVENUE CODE OF 1986.

      THIS  CERTIFICATE  HAS NOT  BEEN  AND WILL  NOT BE  REGISTERED  UNDER  THE
SECURITIES ACT OF 1933, AS AMENDED,  OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR  TRANSFERRED  UNLESS IT IS REGISTERED  PURSUANT TO SUCH ACT AND
LAWS  OR  IS  SOLD  OR  TRANSFERRED  IN  TRANSACTIONS   WHICH  ARE  EXEMPT  FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE  WITH THE  PROVISIONS  OF SECTION  5.02 OF THE POOLING AND  SERVICING
AGREEMENT (THE "AGREEMENT").

      NO TRANSFER OF THIS  CERTIFICATE  OR ANY INTEREST  HEREIN SHALL BE MADE TO
ANY PLAN  SUBJECT  TO TITLE I OF ERISA OR SECTION  4975 OF THE CODE,  ANY PERSON
ACTING,  DIRECTLY  OR  INDIRECTLY,  ON  BEHALF  OF ANY SUCH  PLAN OR ANY  PERSON
ACQUIRING SUCH  CERTIFICATES  WITH "PLAN ASSETS" OF A PLAN WITHIN THE MEANING OF
THE DEPARTMENT OF LABOR REGULATION  PROMULGATED AT 29 C.F.R.  ss.2510.3-101,  AS
MODIFIED  BY  SECTION  3(42) OF ERISA  ("PLAN  ASSET  REGULATIONS"),  UNLESS THE
DEPOSITOR,  THE TRUSTEE AND THE MASTER  SERVICER ARE PROVIDED WITH AN OPINION OF
COUNSEL WHICH  ESTABLISHES TO THE  SATISFACTION OF THE TRUSTEE THAT THE PURCHASE
OF THIS CERTIFICATE IS PERMISSIBLE  UNDER APPLICABLE LAW, WILL NOT CONSTITUTE OR
RESULT IN ANY PROHIBITED  TRANSACTION  UNDER TITLE I OF ERISA OR SECTION 4975 OF
THE CODE AND WILL NOT SUBJECT THE DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE OR
THE  TRUST  FUND  TO ANY  OBLIGATION  OR  LIABILITY  (INCLUDING  OBLIGATIONS  OR
LIABILITIES  UNDER TITLE I OF ERISA OR SECTION  4975 OF THE CODE) IN ADDITION TO
THOSE  UNDERTAKEN  IN THE  AGREEMENT,  WHICH  OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF. THE DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE OR THE TRUST FUND.

<PAGE>

Class SB-[ ] Subordinate                   Certificate No. ___

Date of Pooling and Servicing Agreement    Percentage Interest: _____%
and Cut-off Date:
___________ 1, ____

First Distribution Date:                   Aggregate Initial Notional Principal
___________ 25, ____                       Balance of the Class SB-[ ]
                                           Certificates: $____________

Master Servicer:                           Initial Notional Balance
Residential Funding Company, LLC           of this Class SB-2 Certificate:
                                           $____________

Maturity Date:                             CUSIP: ____________
___________ 25, ____

                 MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
                                Series _____-____

            evidencing a percentage  interest in any distributions  allocable to
            the  Class  SB-[ ]  Certificates  with  respect  to the  Trust  Fund
            consisting primarily of a pool of [one- to four-family  residential,
            hybrid  adjustable-rate  first lien  mortgage  loans with a negative
            amortization feature] formed and sold by RESIDENTIAL ACCREDIT LOANS,
            INC.

      This  Certificate is payable solely from the assets of the Trust Fund, and
does not represent an obligation of or interest in Residential  Accredit  Loans,
Inc., the Master Servicer, the Trustee referred to below or GMAC Mortgage Group,
LLC or any of their  affiliates.  Neither this  Certificate  nor the  underlying
Mortgage  Loans  are  guaranteed  or  insured  by  any  governmental  agency  or
instrumentality or by Residential Accredit Loans, Inc., the Master Servicer, the
Trustee or GMAC  Mortgage  Group,  LLC or any of their  affiliates.  None of the
Depositor,  the  Master  Servicer,  GMAC  Mortgage  Group,  LLC or any of  their
affiliates  will have any  obligation  with respect to any  certificate or other
obligation secured by or payable from payments on the Certificates.

      This  certifies  that  PRAMWAVE  & CO.  is  the  registered  owner  of the
Percentage Interest evidenced by this Certificate in certain  distributions with
respect to the Trust Fund consisting primarily of an interest in a pool of [one-
to  four-family  adjustable  rate  first lien  mortgage  loans]  (the  "Mortgage
Loans"),  sold by  Residential  Accredit  Loans,  Inc.  (hereinafter  called the
"Depositor,"  which term  includes  any  successor  entity  under the  Agreement
referred to below).

                                     C-II-2
<PAGE>

The Trust Fund was created  pursuant to a Pooling and Servicing  Agreement dated
as specified above (the  "Agreement")  among the Depositor,  the Master Servicer
and  _____________,  as  trustee  (the  "Trustee"),  a summary of certain of the
pertinent provisions of which is set forth hereafter.  To the extent not defined
herein,  the  capitalized  terms used herein have the  meanings  assigned in the
Agreement.  This  Certificate  is issued  under  and is  subject  to the  terms,
provisions  and conditions of the  Agreement,  to which  Agreement the Holder of
this Certificate by virtue of the acceptance  hereof,  assents and by which such
Holder is bound.

      Pursuant to the terms of the Agreement, a distribution will be made on the
25th day of each month or, if such 25th day is not a Business  Day, the Business
Day immediately following (the "Distribution Date"),  commencing as described in
the Agreement, to the Person in whose name this Certificate is registered at the
close of business on the last  Business Day of the month  immediately  preceding
the  month  of  such  distribution  (the  "Record  Date"),  from  the  Available
Distribution Amount in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount of interest and principal,  if any,
required  to be  distributed  to Holders of Class  SB-[ ]  Certificates  on such
Distribution Date.

      Distributions  on  this  Certificate  will be made  either  by the  Master
Servicer  acting on behalf of the Trustee or by a Paying Agent  appointed by the
Trustee in immediately  available  funds (by wire transfer or otherwise) for the
account of the Person entitled thereto if such Person shall have so notified the
Master  Servicer or such Paying Agent,  or by check mailed to the address of the
Person  entitled  thereto,  as  such  name  and  address  shall  appear  on  the
Certificate Register.

      Notwithstanding the above, the final distribution on this Certificate will
be made  after due notice of the  pendency  of such  distribution  and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the  Trustee  for that  purpose.  The  Notional  Amount of this  Class SB-[ ]
Certificate as of any date of  determination  will be calculated as described in
the  Agreement.  This Class  SB-[ ]  Certificate  will  accrue  interest  at the
Pass-Through  Rate on the  Notional  Amount as indicated  in the  definition  of
Accrued  Certificate  Interest in the  Agreement.  This Class SB-[ ] Certificate
will not accrue interest on its Certificate Principal Balance.

      No  transfer  of this Class SB-[ ]  Certificate  will be made  unless such
transfer is exempt from the  registration  requirements of the Securities Act of
1933,  as  amended,  and  any  applicable  state  securities  laws or is made in
accordance  with said Act and laws.  In the event that such a transfer  is to be
made,  (i) the  Trustee  or the  Depositor  may  require  an  opinion of counsel
acceptable  to and in form and  substance  satisfactory  to the  Trustee and the
Depositor that such transfer is exempt (describing the applicable  exemption and
the  basis  therefor)  from  or is  being  made  pursuant  to  the  registration
requirements  of the Securities  Act of 1933, as amended,  and of any applicable
statute of any state and (ii) the transferee shall execute an investment  letter
in the form  described by the  Agreement.  The Holder hereof  desiring to effect
such  transfer  shall,  and does hereby agree to,  indemnify  the  Trustee,  the
Depositor, the Master Servicer and the Certificate Registrar acting on behalf of
the Trustee  against  any  liability  that may result if the  transfer is not so
exempt or is not made in accordance with such Federal and state laws.

                                     C-II-3
<PAGE>

      No transfer of this  Certificate  or any interest  herein shall be made to
any Plan  subject  to Title I of ERISA or Section  4975 of the Code,  any Person
acting,  directly  or  indirectly,  on  behalf  of any such  Plan or any  Person
acquiring such  Certificates  with "plan assets" of a Plan within the meaning of
the Department of Labor regulation  promulgated at 29 C.F.R.  ss.2510.3-101,  as
modified  by  Section  3(42) of ERISA  ("Plan  Asset  Regulations"),  unless the
Depositor,  the Trustee and the Master  Servicer are provided with an Opinion of
Counsel which  establishes to the  satisfaction of the Trustee that the purchase
of this Certificate is permissible  under applicable law, will not constitute or
result in any prohibited  transaction  under Title I of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Master Servicer, the Trustee or
the  Trust  Fund  to any  obligation  or  liability  (including  obligations  or
liabilities  under Title I of ERISA or Section  4975 of the Code) in addition to
those  undertaken  in the  Agreement,  which  Opinion of Counsel shall not be an
expense of the Depositor, the Master Servicer, the Trustee or the Trust Fund.

      This Certificate is one of a duly authorized issue of Certificates  issued
in several Classes designated as Mortgage Asset-Backed Pass-Through Certificates
of the Series specified hereon (herein collectively called the "Certificates").

      The  Certificates  are limited in right of payment to certain  collections
and recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the  Agreement.  In the event Master  Servicer  funds are advanced
with respect to any Mortgage Loan,  such advance is  reimbursable  to the Master
Servicer,  to the extent provided in the Agreement,  from related  recoveries on
such  Mortgage  Loan or from other cash that  would have been  distributable  to
Certificateholders.

      As provided  in the  Agreement,  withdrawals  from the  Custodial  Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the  Master  Servicer  from  time to time  for  purposes  other  than
distributions to Certificateholders,  such purposes including without limitation
reimbursement  to the  Depositor  and the Master  Servicer of advances  made, or
certain expenses incurred, by either of them.

      The Agreement  permits,  with certain  exceptions  therein  provided,  the
amendment of the Agreement and the modification of the rights and obligations of
the  Depositor,  the  Master  Servicer  and the  Trustee  and the  rights of the
Certificateholders  under the Agreement from time to time by the Depositor,  the
Master  Servicer and the Trustee with the consent of the Holders of Certificates
evidencing  in the aggregate  not less than 66% of the  Percentage  Interests of
each Class of Certificates  affected thereby.  Any such consent by the Holder of
this  Certificate  shall be  conclusive  and binding on such Holder and upon all
future  holders  of this  Certificate  and of any  Certificate  issued  upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the  Certificate.  The  Agreement  also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain  additional  circumstances,  without the
consent of the Holders of certain Classes of Certificates.

      As provided in the  Agreement and subject to certain  limitations  therein
set forth,  the transfer of this  Certificate is registrable in the  Certificate
Register upon surrender of this  Certificate for registration of transfer at the
offices or agencies appointed by the Trustee, duly

                                     C-II-4
<PAGE>

endorsed by, or  accompanied by an assignment in the form below or other written
instrument of transfer in form  satisfactory  to the Trustee and the Certificate
Registrar  duly  executed by the Holder  hereof or such  Holder's  attorney duly
authorized in writing,  and thereupon one or more new Certificates of authorized
denominations  evidencing the same Class and aggregate  Percentage Interest will
be issued to the designated transferee or transferees.

      The  Certificates  are issuable  only as registered  Certificates  without
coupons in Classes and in denominations  specified in the Agreement. As provided
in  the  Agreement  and  subject  to  certain  limitations  therein  set  forth,
Certificates are  exchangeable for new Certificates of authorized  denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

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

      The Depositor, the Master Servicer, the Trustee, the Certificate Registrar
and any  agent  of the  Depositor,  the  Master  Servicer,  the  Trustee  or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered as the owner hereof for all purposes, and neither the Depositor,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

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

      The  obligations  created by the Agreement in respect of the  Certificates
and the  Trust  Fund  created  thereby  shall  terminate  upon  the  payment  to
Certificateholders  of all  amounts  held by or on  behalf  of the  Trustee  and
required to be paid to them pursuant to the  Agreement  following the earlier of
(i) the maturity or other  liquidation of the last Mortgage Loan subject thereto
or the disposition of all property  acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage  Loan, and (ii) the purchase by the Master  Servicer
from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such  Mortgage  Loans,  thereby  effecting  early  retirement  of the
Certificates.  The Agreement permits,  but does not require, the Master Servicer
(i) to  purchase,  at a price  determined  as  provided  in the  Agreement,  all
remaining  Mortgage  Loans and all property  acquired in respect of any Mortgage
Loan or (ii) to purchase in whole, but not in part, all of the Certificates from
the Holders thereof, provided, that any such option may only be exercised if the
Stated Principal Balance before giving effect to the distributions to be made on
such  Distribution  Date of the Mortgage Loans, as of the Distribution Date upon
which the proceeds of any such purchase are distributed is less than ten percent
of the Cut-off Date Principal Balance of the Mortgage Loans.

      Unless the certificate of  authentication  hereon has been executed by the
Certificate  Registrar  by  manual  signature,  this  Certificate  shall  not be
entitled to any benefit under the Agreement or be valid for any purpose.

                            [Signature Page Follows]

                                     C-II-5
<PAGE>

      IN WITNESS  WHEREOF,  the Trustee has caused this  Certificate  to be duly
executed.

                                            __________________________,
                                            as Trustee

                                            By: ______________________
                                             Authorized Signatory

Dated:  _________, ____

                          CERTIFICATE OF AUTHENTICATION

      This  is  one  of  the  Class  SB-[  ]  Certificates  referred  to in  the
within-mentioned Agreement.

                                            ___________________________,
                                            as Certificate Registrar

                                            By: _______________________
                                             Authorized Signatory

                                     C-II-6
<PAGE>

                                   ASSIGNMENT

FOR VALUE RECEIVED,  the undersigned  hereby sell(s),  assign(s) and transfer(s)
unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please  print  or  typewrite  name and  address  including  postal  zip code of
assignee) the beneficial  interest evidenced by the within Trust Certificate and
hereby  authorizes the transfer of  registration of such interest to assignee on
the Certificate Register of the Trust Fund.

      I (We) further direct the Certificate Registrar to issue a new Certificate
of a like  denomination  and Class, to the above named assignee and deliver such
Certificate to the following address:
________________________________________________________________________________

Dated:_____________________               _____________________________________
                                          Signature by or on behalf of assignor

                                          ______________________________________
                                          Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

      The assignee should include the following for purposes of distribution:

Distributions  shall be made,  by wire  transfer or  otherwise,  in  immediately
available fund to ______________________________________________________________
for the  account  of  __________________________________________________________
account number  ________________________________________________________________
or, if mailed by check, to______________________________________________________

      Applicable statements should be mailed to:________________________________
________________________________________________________________________________
________________________________________________________________________________

      This information is provided by  ___________________________________,  the
assignee named above, or ______________________________, as its agent.

<PAGE>

                                    EXHIBIT D

                           FORM OF CLASS R CERTIFICATE

THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED STATES PERSON
OR A DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).

SOLELY FOR U.S.  FEDERAL  INCOME TAX PURPOSES,  THIS  CERTIFICATE IS A "RESIDUAL
INTEREST"  IN A "REAL  ESTATE  MORTGAGE  INVESTMENT  CONDUIT" AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986 (THE "CODE").

NO TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION  PURSUANT TO SECTION 5.02(e) OF THE AGREEMENT OR
AN OPINION OF COUNSEL  SATISFACTORY  TO THE  TRUSTEE  THAT THE  PURCHASE OF THIS
CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION
UNDER  SECTION 406 OF THE EMPLOYEE  RETIREMENT  INCOME  SECURITY ACT OF 1974, AS
AMENDED  ("ERISA"),  OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE MASTER
SERVICER,  THE COMPANY OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY IN ADDITION
TO THOSE UNDERTAKEN IN THE AGREEMENT.

ANY RESALE,  TRANSFER OR OTHER  DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED  TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER SERVICER
AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE
OR POLITICAL  SUBDIVISION  THEREOF,  ANY POSSESSION OF THE UNITED STATES, OR ANY
AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN INSTRUMENTALITY
WHICH IS A CORPORATION  IF ALL OF ITS  ACTIVITIES  ARE SUBJECT TO TAX AND EXCEPT
FOR FREDDIE  MAC, A MAJORITY OF ITS BOARD OF  DIRECTORS  IS NOT SELECTED BY SUCH
GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR
ANY AGENCY OR INSTRUMENTALITY  OF EITHER OF THE FOREGOING,  (C) ANY ORGANIZATION
(OTHER THAN CERTAIN FARMERS' COOPERATIVES  DESCRIBED IN SECTION 521 OF THE CODE)
WHICH IS  EXEMPT  FROM THE TAX  IMPOSED  BY  CHAPTER 1 OF THE CODE  UNLESS  SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE (INCLUDING
THE TAX  IMPOSED  BY  SECTION  511 OF THE  CODE ON  UNRELATED  BUSINESS  TAXABLE
INCOME),  (D) RURAL  ELECTRIC AND  TELEPHONE  COOPERATIVES  DESCRIBED IN SECTION
1381(a)(2)(C)  OF THE CODE,  (E) AN ELECTING  LARGE  PARTNERSHIP  UNDER  SECTION
775(a) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B),
(C), (D) OR (E) BEING HEREIN REFERRED TO AS A "DISQUALIFIED  ORGANIZATION"),  OR
(F) AN AGENT OF A DISQUALIFIED ORGANIZATION,  (2) NO PURPOSE OF SUCH TRANSFER IS
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE  SATISFIES
CERTAIN  ADDITIONAL  CONDITIONS  RELATING  TO  THE  FINANCIAL  CONDITION  OF THE
PROPOSED  TRANSFEREE.   NOTWITHSTANDING  THE  REGISTRATION  IN  THE  CERTIFICATE
REGISTER OR ANY

<PAGE>

TRANSFER,  SALE OR  OTHER  DISPOSITION  OF THIS  CERTIFICATE  TO A  DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL
BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT
BE DEEMED TO BE A CERTIFICATEHOLDER  FOR ANY PURPOSE HEREUNDER,  INCLUDING,  BUT
NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF
THIS  CERTIFICATE  BY  ACCEPTANCE  OF THIS  CERTIFICATE  SHALL BE DEEMED TO HAVE
CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.

Certificate No. __                      [___]% Pass-Through Rate

Class R Senior                          Aggregate Initial Certificate
                                        Principal Balance of the
Date of Pooling and Servicing           Class R Certificates:
Agreement and Cut-off Date:             $100.00
___________ 1, ____
                                        Initial Certificate Principal
First Distribution Date:                Balance of this Certificate:
_________ 25, ____                      $___________

Master Servicer:                        Percentage Interest:
Residential Funding Company, LLC        __%

Assumed Final Distribution Date:        CUSIP 76110F-___
___________ 25, ____

                 MORTGAGE ASSET-BACKED PASS-THROUGH CERTIFICATE,
                                 SERIES ____-___

      evidencing a  percentage  interest in any  distributions  allocable to the
      Class R Certificates  with respect to the Trust Fund consisting  primarily
      of a pool of [conventional  one- to four-family  fixed interest rate first
      mortgage loans] formed and sold by RESIDENTIAL ACCREDIT LOANS, INC.

            This  Certificate  is  payable  solely  from the assets of the Trust
Fund,  and does not  represent  an  obligation  of or  interest  in  Residential
Accredit Loans, Inc., the Master Servicer, the Trustee referred to below or GMAC
Mortgage Group, LLC or any of their affiliates. Neither this Certificate nor the
underlying  Mortgage Loans are guaranteed or insured by any governmental  agency
or instrumentality or by Residential  Accredit Loans, Inc., the Master Servicer,
the Trustee or GMAC Mortgage Group, LLC or any of their affiliates.  None of the
Company,  the  Master  Servicer,  GMAC  Mortgage  Group,  LLC or  any  of  their
affiliates  will have any  obligation  with respect to any  certificate or other
obligation secured by or payable from payments on the Certificates.

            This certifies that  _______________________ is the registered owner
of the Percentage  Interest evidenced by this Certificate  (obtained by dividing
the Initial Certificate

<PAGE>

Principal  Balance of this  Certificate  by the  aggregate  Initial  Certificate
Principal  Balance  of all Class R  Certificates,  both as  specified  above) in
certain  distributions with respect to the Trust Fund consisting  primarily of a
pool of  [conventional  one- to  four-family  fixed interest rate first mortgage
loans] (the "Mortgage  Loans"),  formed and sold by Residential  Accredit Loans,
Inc. (hereinafter called the "Company," which term includes any successor entity
under the Agreement referred to below). The Trust Fund was created pursuant to a
Pooling and Servicing Agreement dated as specified above (the "Agreement") among
the  Company,  the Master  Servicer  and  __________________,  as  trustee  (the
"Trustee"),  a summary of certain of the  pertinent  provisions  of which is set
forth hereafter.  To the extent not defined herein,  the capitalized  terms used
herein have the meanings  assigned in the Agreement.  This Certificate is issued
under and is subject to the terms,  provisions  and conditions of the Agreement,
to which  Agreement the Holder of this  Certificate  by virtue of the acceptance
hereof assents and by which such Holder is bound.

            Pursuant to the terms of the Agreement,  a distribution will be made
on the 25th day of each  month or, if such 25th day is not a Business  Day,  the
Business Day  immediately  following (the  "Distribution  Date"),  commencing as
described  in the  Agreement,  to the Person in whose name this  Certificate  is
registered  at the close of business on the last day (or if such last day is not
a Business  Day, the Business Day  immediately  preceding  such last day) of the
month immediately  preceding the month of such distribution (the "Record Date"),
from the Available  Distribution Amount in an amount equal to the product of the
Percentage  Interest  evidenced by this  Certificate and the amount (of interest
and  principal,  if any)  required  to be  distributed  to  Holders  of  Class R
Certificates on such Distribution Date.

            Each Holder of this  Certificate will be deemed to have agreed to be
bound by the restrictions set forth in the Agreement to the effect that (i) each
person holding or acquiring any Ownership Interest in this Certificate must be a
United  States  Person and a  Permitted  Transferee,  (ii) the  transfer  of any
Ownership  Interest in this Certificate will be conditioned upon the delivery to
the Trustee of,  among other  things,  an  affidavit  to the effect that it is a
United States Person and Permitted Transferee,  (iii) any attempted or purported
transfer of any  Ownership  Interest in this  Certificate  in  violation of such
restrictions  will be  absolutely  null and void and will  vest no rights in the
purported  transferee,  and (iv) if any person other than a United States Person
and a Permitted  Transferee  acquires any Ownership Interest in this Certificate
in violation of such restrictions,  then the Company will have the right, in its
sole  discretion and without notice to the Holder of this  Certificate,  to sell
this Certificate to a purchaser selected by the Company,  which purchaser may be
the Company,  or any affiliate of the Company,  on such terms and  conditions as
the Company may choose.

            Notwithstanding   the  above,   the  final   distribution   on  this
Certificate  will be made after due notice of the pendency of such  distribution
and only upon  presentation  and surrender of this  Certificate at the office or
agency  appointed  by the Trustee  for that  purpose.  The  Initial  Certificate
Principal  Balance  of this  Certificate  is set forth  above.  The  Certificate
Principal  Balance  hereof  will  be  reduced  to the  extent  of  distributions
allocable to principal and any Realized Losses allocable hereto. Notwithstanding
the  reduction  of the  Certificate  Principal  Balance  hereof  to  zero,  this
Certificate  will remain  outstanding  under the Agreement and the Holder hereof
may have additional obligations with respect to this Certificate,  including tax

<PAGE>

liabilities,  and may be entitled to certain additional distributions hereon, in
accordance with the terms and provisions of the Agreement.

            No  transfer  of this Class R  Certificate  will be made  unless the
Trustee has received either (i) an opinion of counsel  addressed to the Trustee,
the Company and the Master  Servicer,  acceptable  to and in form and  substance
satisfactory to the Trustee with respect to the  permissibility of such transfer
under the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
and Section  4975 of the Internal  Revenue Code (the "Code") and stating,  among
other things,  that the  transferee's  acquisition of a Class R Certificate will
not constitute or result in a non-exempt  prohibited  transaction  under Section
406 of ERISA or Section 4975 of the Code or (ii) a representation letter, in the
form as  described  by the  Agreement,  stating  that the  transferee  is not an
employee benefit or other plan subject to the prohibited  transaction provisions
of ERISA or Section 4975 of the Code (a "Plan"),  or any other person (including
an  investment  manager,  a named  fiduciary  or a trustee of any Plan)  acting,
directly or indirectly,  on behalf of or purchasing any  Certificate  with "plan
assets" of any Plan.

            This  Certificate is one of a duly authorized  issue of Certificates
issued in several  Classes  designated  as  Mortgage  Asset-Backed  Pass-Through
Certificates  of the Series  specified  hereon (herein  collectively  called the
"Certificates").

            The  Certificates  are  limited  in  right  of  payment  to  certain
collections  and  recoveries   respecting  the  Mortgage  Loans,   all  as  more
specifically set forth herein and in the Agreement. In the event Master Servicer
funds  are  advanced  with  respect  to  any  Mortgage  Loan,  such  advance  is
reimbursable  to the Master  Servicer,  to the extent provided in the Agreement,
from related recoveries on such Mortgage Loan or from other cash that would have
been distributable to Certificateholders.

            As provided in the Agreement, withdrawals from the Custodial Account
and/or the Certificate Account created for the benefit of Certificateholders may
be made by the  Master  Servicer  from  time to time  for  purposes  other  than
distributions to Certificateholders,  such purposes including without limitation
reimbursement  to the Company  and the Master  Servicer  of  advances  made,  or
certain expenses incurred, by either of them.

            The Agreement permits, with certain exceptions therein provided, the
amendment of the Agreement and the modification of the rights and obligations of
the  Company,  the  Master  Servicer  and  the  Trustee  and the  rights  of the
Certificateholders  under the  Agreement at any time by the Company,  the Master
Servicer  and the  Trustee  with the  consent  of the  Holders  of  Certificates
evidencing  in the aggregate  not less than 66% of the  Percentage  Interests of
each Class of Certificates  affected thereby.  Any such consent by the Holder of
this  Certificate  shall be  conclusive  and binding on such Holder and upon all
future  holders  of this  Certificate  and of any  Certificate  issued  upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon the  Certificate.  The  Agreement  also permits the
amendment thereof in certain circumstances without the consent of the Holders of
any of the Certificates and, in certain  additional  circumstances,  without the
consent of the Holders of certain Classes of Certificates.

<PAGE>

            As provided  in the  Agreement  and  subject to certain  limitations
therein  set forth,  the  transfer of this  Certificate  is  registrable  in the
Certificate  Register upon surrender of this  Certificate  for  registration  of
transfer at the offices or agencies appointed by the Trustee,  duly endorsed by,
or accompanied by an assignment in the form below or other written instrument of
transfer in form satisfactory to the Trustee and the Certificate  Registrar duly
executed by the Holder  hereof or such  Holder's  attorney  duly  authorized  in
writing, and thereupon one or more new Certificates of authorized  denominations
evidencing  the same Class and aggregate  Percentage  Interest will be issued to
the designated transferee or transferees.

            The  Certificates  are  issuable  only  as  registered  Certificates
without coupons in Classes and in denominations  specified in the Agreement.  As
provided in the Agreement and subject to certain  limitations therein set forth,
Certificates are  exchangeable for new Certificates of authorized  denominations
evidencing the same Class and aggregate Percentage Interest, as requested by the
Holder surrendering the same.

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

            The Company,  the Master  Servicer,  the Trustee and the Certificate
Registrar and any agent of the Company, the Master Servicer,  the Trustee or the
Certificate  Registrar  may treat the Person in whose name this  Certificate  is
registered  as the owner hereof for all purposes,  and neither the Company,  the
Master  Servicer,  the Trustee nor any such agent shall be affected by notice to
the contrary.

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

            The  obligations   created  by  the  Agreement  in  respect  of  the
Certificates and the Trust Fund created thereby shall terminate upon the payment
to  Certificateholders  of all  amounts  held by or on behalf of the Trustee and
required to be paid to them pursuant to the  Agreement  following the earlier of
(i) the maturity or other  liquidation of the last Mortgage Loan subject thereto
or the disposition of all property  acquired upon foreclosure or deed in lieu of
foreclosure  of any Mortgage  Loan and (ii) the purchase by the Master  Servicer
from the Trust Fund of all remaining Mortgage Loans and all property acquired in
respect of such  Mortgage  Loans,  thereby  effecting  early  retirement  of the
Certificates.  The Agreement permits,  but does not require, the Master Servicer
to (i) purchase at a price determined as provided in the Agreement all remaining
Mortgage Loans and all property acquired in respect of any Mortgage Loan or (ii)
purchase in whole,  but not in part,  all of the  Certificates  from the Holders
thereof; provided, that any such option may only be exercised if the Pool Stated
Principal  Balance of the Mortgage Loans as of the Distribution  Date upon which
the proceeds of any such  purchase are  distributed  is less than ten percent of
the Cut-off Date Principal Balance of the Mortgage Loans.

            Reference  is  hereby  made  to  the  further   provisions  of  this
Certificate set forth on the reverse hereof,  which further provisions shall for
all purpose have the same effect as if set forth at this place.

<PAGE>

            Unless the certificate of authentication hereon has been executed by
the Certificate  Registrar,  by manual signature,  this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.

<PAGE>

            IN WITNESS  WHEREOF,  the Trustee has caused this  Certificate to be
duly executed.

Dated:                                [____________________________],
                                      as Trustee

                                      By: _________________________
                                          Authorized Signatory

                          CERTIFICATE OF AUTHENTICATION

            This  is  one  of  the  Class  R  Certificates  referred  to in  the
within-mentioned Agreement.

                                      [____________________________],
                                          as Certificate Registrar

                                      By: _________________________
                                          Authorized Signatory

<PAGE>

                                            ASSIGNMENT

            FOR VALUE RECEIVED,  the undersigned  hereby sell(s),  assign(s) and
transfer(s) unto __________________  (Please print or typewrite name and address
including  postal zip code of assignee) a Percentage  Interest  evidenced by the
within Mortgage Asset-Backed  Pass-Through Certificate and hereby authorizes the
transfer  of  registration  of such  interest  to  assignee  on the  Certificate
Register of the Trust Fund.

            I (We)  further  direct  the  Certificate  Registrar  to issue a new
Certificate of a like  denomination  and Class,  to the above named assignee and
deliver such Certificate to the following address:

Dated:                                ________________________________________
                                      Signature by or on behalf of assignor

                                      ________________________________________
                                          Signature Guaranteed

                            DISTRIBUTION INSTRUCTIONS

            The  assignee   should   include  the   following  for  purposes  of
distribution:

            Distributions  shall be made,  by wire  transfer  or  otherwise,  in
immediately   available   funds   to   _______________   for  the   account   of
____________________  account  number  __________,  or, if  mailed by check,  to
__________________     Applicable     statements    should    be    mailed    to
____________________.

            This  information  is  provided  by  _________________________,  the
assignee named above, or _____________________________, as its agent.

<PAGE>

                                   EXHIBIT E

                        FORM OF SELLER/SERVICER CONTRACT

      This  Seller/Servicer  Contract  (as  may  be  amended,   supplemented  or
otherwise  modified from time to time, this  "Contract") is made this ______ day
of  ______,  20__  , by  and  between  Residential  Funding  Company,  LLC,  its
successors  and  assigns  ("Residential  Funding")  and  _________________  (the
"Seller/Servicer,"  and,  together with Residential  Funding,  the "parties" and
each, individually, a "party").

      WHEREAS,  the  Seller/Servicer  desires to sell Loans to,  and/or  service
Loans for,  Residential  Funding,  and  Residential  Funding desires to purchase
Loans from the Seller/Servicer  and/or have the Seller/Servicer  service various
of its Loans, pursuant to the terms of this Contract and the Residential Funding
Seller  and  Servicer  Guides  incorporated  herein by  reference,  as  amended,
supplemented or otherwise modified, from time to time (together, the "Guides").

      NOW,  THEREFORE,   in  consideration  of  the  premises,  and  the  terms,
conditions and agreements set forth below, the parties agree as follows:

1. Incorporation of Guides by Reference.

      The Seller/Servicer acknowledges that it has received and read the Guides.
All provisions of the Guides are  incorporated by reference into and made a part
of this Contract, and shall be binding upon the parties; provided, however, that
the Seller/Servicer  shall be entitled to sell Loans to and/or service Loans for
Residential  Funding only if and for so long as it shall have been authorized to
do so by Residential Funding in writing.  Specific reference in this Contract to
particular  provisions of the Guides and not to other  provisions  does not mean
that those provisions of the Guides not specifically  cited in this Contract are
not applicable. All terms used herein shall have the same meanings as such terms
have in the Guides, unless the context clearly requires otherwise.

2. Amendments.

      This Contract may not be amended or modified  orally,  and no provision of
this  Contract  may be waived or amended  except in writing  signed by the party
against whom  enforcement  is sought.  Such a written  waiver or amendment  must
expressly  reference this Contract.  However,  by their terms, the Guides may be
amended or  supplemented  by  Residential  Funding  from time to time.  Any such
amendment(s) to the Guides shall be binding upon the parties hereto.

3. Representations and Warranties.

      a. Reciprocal Representations and Warranties.

            The  Seller/Servicer  and  Residential  Funding each  represents and
warrants to the other that as of the date of this Contract:

<PAGE>

            (1)   Each party is duly organized,  validly  existing,  and in good
                  standing under the laws of its  jurisdiction of  organization,
                  is  qualified,  if  necessary,  to do  business  and  in  good
                  standing in each jurisdiction in which it is required to be so
                  qualified,  and has the requisite power and authority to enter
                  into  this  Contract  and  all  other   agreements  which  are
                  contemplated by this Contract and to carry out its obligations
                  hereunder   and  under  the   Guides   and  under  such  other
                  agreements.

            (2)   This Contract has been duly authorized, executed and delivered
                  by each  party and  constitutes  a valid and  legally  binding
                  agreement of each party  enforceable  in  accordance  with its
                  terms.

            (3)   There is no action,  proceeding  or  investigation  pending or
                  threatened,  and no basis  therefor is known to either  party,
                  that could affect the validity or prospective validity of this
                  Contract.

            (4)   Insofar as its capacity to carry out any obligation under this
                  Contract is  concerned,  neither  party is in violation of any
                  charter,  articles of incorporation,  bylaws,  certificates of
                  formation,  limited  liability  company  agreement,  mortgage,
                  indenture,  indebtedness,   agreement,  instrument,  judgment,
                  decree,  order,  statute,  rule or regulation  and none of the
                  foregoing adversely affects its capacity to fulfill any of its
                  obligations  under  this  Contract.   Its  execution  of,  and
                  performance  pursuant to, this  Contract  will not result in a
                  violation of any of the foregoing.

      b.    Seller/Servicer's Representations, Warranties and Covenants.

            In addition to the representations, warranties and covenants made by
            the  Seller/Servicer  pursuant to subparagraph (a) of this paragraph
            3, the  Seller/Servicer  makes the  representations,  warranties and
            covenants  set forth in the  Guides  and,  upon  request,  agrees to
            deliver to Residential Funding the certified  Resolution of Board of
            Directors  which  authorizes  the  execution  and  delivery  of this
            Contract.

4. Remedies of Residential Funding.

      If an Event of Seller Default or an Event of Servicer Default shall occur,
Residential  Funding may, at its option,  exercise one or more of those remedies
set forth in the Guides.

5. Seller/Servicer's Status as Independent Contractor.

      At no time  shall the  Seller/Servicer  represent  that it is acting as an
agent of Residential Funding. The Seller/Servicer shall, at all times, act as an
independent contractor.

                                      E-2
<PAGE>

6. Prior Agreements Superseded.

      This Contract  restates,  amends and  supersedes  any and all prior Seller
Contracts or Servicer Contracts between the parties except that any subservicing
agreement  executed by the  Seller/Servicer in connection with any loan-security
exchange transaction shall not be affected.

7. Assignment.

      This Contract may not be assigned or transferred,  in whole or in part, by
the  Seller/Servicer  without the prior written consent of Residential  Funding.
Residential  Funding may sell,  assign,  convey,  hypothecate,  pledge or in any
other way transfer,  in whole or in part, without restriction,  its rights under
this Contract and the Guides with respect to any Commitment or Loan.

8. Notices.

      All  notices,  requests,  demands or other  communications  that are to be
given under this  Contract  shall be in writing,  addressed  to the  appropriate
parties and sent by  telefacsimile  or by overnight  courier or by United States
mail,  postage prepaid,  to the addresses and  telefacsimile  numbers  specified
below.  However,  another  name,  address  and/or  telefacsimile  number  may be
substituted  by  the  Seller/Servicer  pursuant  to  the  requirements  of  this
paragraph 8, or Residential Funding pursuant to an amendment to the Guides.

If to Residential  Funding,  notices must be sent to the appropriate  address or
telefacsimile number specified in the Guides.

If to the Seller/Servicer, notice must be sent to:

      ______________________________
      ______________________________
      ______________________________
      Attention: ___________________
      Telefacsimile Number:  (___)___-____

9. Jurisdiction and Venue.

      Each of the parties  irrevocably  submits to the jurisdiction of any state
or federal court located in Hennepin County, Minnesota, over any action, suit or
proceeding  to enforce or defend any right  under  this  Contract  or  otherwise
arising from any loan sale or servicing relationship existing in connection with
this  Contract,  and each of the parties  irrevocably  agrees that all claims in
respect of any such  action or  proceeding  may be heard or  determined  in such
state or federal court. Each of the parties irrevocably waives the defense of an
inconvenient  forum to the  maintenance of any such action or proceeding and any
other  substantive or procedural  rights or remedies it may have with respect to
the maintenance of any such action or proceeding in any such forum.  Each of the
parties agrees that a final  judgment in any such action or proceeding  shall be
conclusive and may be enforced in any other jurisdiction by suit on the judgment
or in any other manner  provided by law. Each of the parties  further agrees not
to institute  any legal  actions or  proceedings  against the other party or any
director, officer, employee, attorney, agent

                                      E-3
<PAGE>

or property of the other party,
arising  out of or  relating  to  this  Contract  in any  court  other  than  as
hereinabove specified in this paragraph 9.

10. Miscellaneous.

      This Contract,  including all documents  incorporated by reference herein,
constitutes the entire  understanding  between the parties hereto and supersedes
all other agreements, covenants, representations, warranties, understandings and
communications between the parties, whether written or oral, with respect to the
transactions  contemplated by this Contract.  All paragraph  headings  contained
herein  are for  convenience  only and  shall not be  construed  as part of this
Contract.  Any provision of this Contract that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining portions
hereof or affecting  the  validity or  enforceability  of such  provision in any
other jurisdiction,  and, to this end, the provisions hereof are severable. This
Contract  shall be governed by, and construed  and enforced in accordance  with,
applicable federal laws and the laws of the State of Minnesota.

                                      E-4
<PAGE>

      IN WITNESS WHEREOF,  the duly authorized  officers of the  Seller/Servicer
and Residential  Funding have executed this  Seller/Servicer  Contract as of the
date first above written.

ATTEST:                             SELLER/SERVICER

[Corporate Seal]
                                         _____________________________________
                                               (Name of Seller/Servicer)

By:______________________________        By: _________________________________
    (Signature)                                (Signature)

By: _____________________________        By: _________________________________
       (Typed Name)                                  (Typed Name)

Title: __________________________        Title: ______________________________

ATTEST:                             RESIDENTIAL FUNDING COMPANY, LLC

[Corporate Seal]

By:______________________________        By: _________________________________
    (Signature)                                (Signature)

By: _____________________________        By: _________________________________
       (Typed Name)                                  (Typed Name)

Title: __________________________        Title: ______________________________

                                      E-5
<PAGE>

                                    EXHIBIT F

                          FORMS OF REQUEST FOR RELEASE

DATE:

TO:

RE:            REQUEST FOR RELEASE OF DOCUMENTS

In connection with the  administration of the pool of Mortgage Loans held by you
for the  referenced  pool,  we request  the  release of the  Mortgage  Loan File
described below.

Pooling and Servicing Agreement Dated:
Series#:
Account#:
Pool#:
Loan#:
MIN#:
Borrower Name(s):
Reason for Document Request:          (circle one)

      Mortgage Loan Prepaid in Full            Mortgage Loan Repurchased

"We hereby  certify  that all amounts  received or to be received in  connection
with such  payments  which are required to be deposited  have been or will be so
deposited as provided in the Pooling and Servicing Agreement."

________________________________
Residential Funding Company, LLC
Authorized Signature

******************************************************************************

TO  CUSTODIAN/TRUSTEE:  Please acknowledge this request, and check off documents
being  enclosed  with a copy of this form.  You should retain this form for your
files in accordance with the terms of the Pooling and Servicing Agreement.

Enclosed Documents:       [ ]   Promissory Note
                          [ ]   Primary Insurance Policy
                          [ ]   Mortgage or Deed of Trust
                          [ ]   Assignment(s) of Mortgage or Deed of Trust
                          [ ]   Title Insurance Policy
                          [ ]   Other:

Name: _____________________
Title: ____________________
Date: _____________________

<PAGE>

                                   EXHIBIT G-1

                    FORM OF TRANSFER AFFIDAVIT AND AGREEMENT

STATE OF                    )
                            ) ss.:
COUNTY OF                   )

            [NAME OF OFFICER], being first duly sworn, deposes and says:

            1. That he is  [Title of  Officer]  of [Name of  Owner]  (record  or
beneficial owner of the Mortgage Asset-Backed Pass-Through Certificates,  Series
____-___,  Class R (the "Owner")),  a [savings  institution]  [corporation] duly
organized and existing under the laws of [the State of ___________________] [the
United States], on behalf of which he makes this affidavit and agreement.

            2.  That  the  Owner  (i) is not  and  will  not be a  "disqualified
organization"  or an electing large  partnership as of [date of transfer] within
the  meaning of  Sections  860E(e)(5)  and 775,  respectively,  of the  Internal
Revenue Code of 1986, as amended (the "Code") or an electing  large  partnership
under  Section  775(a) of the Code,  (ii) will  endeavor to remain  other than a
disqualified  organization  for so long as it retains its ownership  interest in
the Class R  Certificates,  and (iii) is acquiring the Class R Certificates  for
its own account or for the account of another  Owner from which it has  received
an affidavit and agreement in substantially  the same form as this affidavit and
agreement.  (For this purpose, a "disqualified  organization"  means an electing
large partnership under Section 775 of the Code, the United States, any state or
political  subdivision  thereof,  any  agency or  instrumentality  of any of the
foregoing  (other than an  instrumentality  all of the  activities  of which are
subject to tax and,  except for the Federal Home Loan  Mortgage  Corporation,  a
majority of whose board of directors  is not  selected by any such  governmental
entity) or any foreign government,  international  organization or any agency or
instrumentality of such foreign  government or organization,  any rural electric
or telephone  cooperative,  or any  organization  (other than  certain  farmers'
cooperatives)  that is  generally  exempt  from  federal  income tax unless such
organization is subject to the tax on unrelated business taxable income).

            3. That the Owner is aware (i) of the tax that  would be  imposed on
transfers of Class R  Certificates  to  disqualified  organizations  or electing
large  partnerships,  under the Code,  that applies to all  transfers of Class R
Certificates after March 31, 1988; (ii) that such tax would be on the transferor
(or,  with  respect to transfers to electing  large  partnerships,  on each such
partnership),  or, if such transfer is through an agent (which person includes a
broker,  nominee or middleman)  for a disqualified  organization,  on the agent;
(iii) that the person  (other than with respect to  transfers to electing  large
partnerships)  otherwise  liable for the tax shall be relieved of liability  for
the tax if the  transferee  furnishes  to such  person  an  affidavit  that  the
transferee is not a disqualified organization and, at the time of transfer, such
person does not have actual knowledge that the affidavit is false; and (iv) that
the Class R Certificates  may be  "noneconomic  residual  interests"  within the
meaning of Treasury  regulations  promulgated  pursuant to the Code and that the
transferor of a noneconomic residual interest will remain liable

                                     G-1-1
<PAGE>

for any taxes due with respect to the income on such residual  interest,  unless
no  significant  purpose  of  the  transfer  was to  impede  the  assessment  or
collection of tax.

            4. That the  Owner is aware of the tax  imposed  on a  "pass-through
entity"  holding Class R Certificates  if either the  pass-through  entity is an
electing  large  partnership  under  Section  775 of the  Code or if at any time
during the taxable year of the pass-through  entity a disqualified  organization
is the record holder of an interest in such entity.  (For this purpose,  a "pass
through  entity"  includes  a  regulated   investment  company,  a  real  estate
investment  trust or common  trust fund,  a  partnership,  trust or estate,  and
certain cooperatives.)

            5. The  Owner is either  (i) a citizen  or  resident  of the  United
States, (ii) a corporation, partnership or other entity treated as a corporation
or a partnership  for U.S.  federal income tax purposes and created or organized
in or under the laws of the United States,  any state thereof or the District of
Columbia (other than a partnership that is not treated as a United States person
under any applicable Treasury regulations), (iii) an estate that is described in
Section 7701(a)(30)(D) of the Code, or (iv) a trust that is described in Section
7701(a)(30)(E) of the Code.

            6. The Owner  hereby  agrees that it will not cause  income from the
Class R Certificates to be attributable to a foreign permanent  establishment or
fixed base (within the meaning of an applicable  income tax treaty) of the Owner
or another United States taxpayer.

            7. That the Owner is aware that the Trustee  will not  register  the
transfer of any Class R Certificates unless the transferee,  or the transferee's
agent,  delivers  to it an  affidavit  and  agreement,  among other  things,  in
substantially the same form as this affidavit and agreement. The Owner expressly
agrees  that it will not  consummate  any such  transfer if it knows or believes
that any of the  representations  contained in such  affidavit and agreement are
false.

            8. That the Owner has  reviewed  the  restrictions  set forth on the
face of the Class R Certificates  and the  provisions of Section  5.02(f) of the
Pooling and Servicing Agreement under which the Class R Certificates were issued
(in particular,  clause (iii)(A) and (iii)(B) of Section 5.02(f) which authorize
the Trustee to deliver payments to a person other than the Owner and negotiate a
mandatory sale by the Trustee in the event the Owner holds such  Certificates in
violation of Section 5.02(f)).  The Owner expressly agrees to be bound by and to
comply with such restrictions and provisions.

            9.  That  the  Owner  consents  to any  additional  restrictions  or
arrangements that shall be deemed necessary upon advice of counsel to constitute
a reasonable  arrangement to ensure that the Class R  Certificates  will only be
owned,  directly  or  indirectly,  by  an  Owner  that  is  not  a  disqualified
organization.

            10. The Owner's Taxpayer Identification Number is _________________.

            11.  This  affidavit  and  agreement  relates  only  to the  Class R
Certificates  held by the  Owner  and not to any  other  holder  of the  Class R
Certificates. The Owner understands that the liabilities described herein relate
only to the Class R Certificates.

                                     G-2-1
<PAGE>

            12. That no purpose of the Owner  relating to the transfer of any of
the Class R Certificates  by the Owner is or will be to impede the assessment or
collection of any tax; in making this  representation,  the Owner  warrants that
the Owner is familiar  with (i)  Treasury  Regulation  Section  1.860E-1(c)  and
recent amendments thereto,  effective as of July 19, 2002, and (ii) the preamble
describing the adoption of the amendments to such regulation,  which is attached
hereto as Exhibit 1.

            13. That the Owner has no present  knowledge or expectation  that it
will be unable to pay any United  States  taxes owed by it so long as any of the
Certificates remain outstanding.  In this regard, the Owner hereby represents to
and for the benefit of the person from whom it acquired the Class R  Certificate
that the Owner  intends  to pay  taxes  associated  with  holding  such  Class R
Certificate  as they  become  due,  fully  understanding  that it may  incur tax
liabilities in excess of any cash flows generated by the Class R Certificate.

            14. That the Owner has no present  knowledge or expectation  that it
will become  insolvent or subject to a bankruptcy  proceeding for so long as any
of the Class R Certificates remain outstanding.

            15. The  Purchaser  is not an  employee  benefit  plan or other plan
subject to the  prohibited  transaction  provisions  of the Employee  Retirement
Income Security Act of 1974, as amended ("ERISA"),  or Section 4975 of the Code,
or an investment manager,  named fiduciary or a trustee of any such plan, or any
other Person  acting,  directly or  indirectly,  on behalf of or purchasing  any
Certificate with "plan assets" of any such plan.

                                     G-3-1
<PAGE>

            IN WITNESS  WHEREOF,  the Owner has  caused  this  instrument  to be
executed on its behalf,  pursuant to the authority of its Board of Directors, by
its [Title of Officer] and its corporate seal to be hereunto attached,  attested
by its [Assistant] Secretary, this _____ day of ____, 200_.

                                      [NAME OF OWNER]

                                      By: ___________________________________
                                          [Name of Officer]
                                          [Title of Officer]
[Corporate Seal]

ATTEST:

________________________________
[Assistant] Secretary

            Personally  appeared  before me the  above-named  [Name of Officer],
known  or  proved  to me to be  the  same  person  who  executed  the  foregoing
instrument and to be the [Title of Officer] of the Owner, and acknowledged to me
that he executed  the same as his free act and deed and the free act and deed of
the Owner.

            Subscribed  and  sworn  before  me  this  _________________  day  of
__________________________, 200_.

                                      __________________________________
                                          NOTARY PUBLIC

                                      COUNTY OF _________________________
                                      STATE OF __________________________
                                           My Commission expires the __ day of
                                      ______________, 20__.

                                     G-4-1
<PAGE>

                                    EXHIBIT 1

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Parts 1 and 602

[TD 9004]
RIN 1545-AW98

Real Estate Mortgage Investment Conduits

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Final regulations.

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

SUMMARY:  This  document  contains  final  regulations  relating  to safe harbor
transfers of noneconomic  residual interests in real estate mortgage  investment
conduits (REMICs).  The final regulations provide additional  limitations on the
circumstances under which transferors may claim safe harbor treatment.

DATES: Effective Date: These regulations are effective July 19, 2002.
    Applicability Date: For dates of applicability, see Sec. 1.860E-
(1)(c)(10).

FOR FURTHER INFORMATION CONTACT: Courtney Shepardson at (202) 622-3940
(not a toll-free number).

SUPPLEMENTARY INFORMATION:

Paperwork Reduction Act

    The  collection  of  information  in this final rule has been  reviewed and,
pending  receipt and  evaluation of public  comments,  approved by the Office of
Management  and Budget (OMB) under 44 U.S.C.  3507 and assigned  control  number
1545-1675.
    The  collection  of  information  in  this  regulation  is in  Sec.  1.860E-
1(c)(5)(ii).  This  information  is  required to enable the IRS to verify that a
taxpayer is complying with the conditions of this regulation.  The collection of
information  is mandatory  and is  required.  Otherwise,  the taxpayer  will not
receive the benefit of safe harbor treatment as provided in the regulation.  The
likely respondents are businesses and other for-profit institutions.

    Comments on the  collection of  information  should be sent to the Office of
Management  and Budget,  Attn:  Desk Officer for the Department of the Treasury,
Office of Information and Regulatory Affairs, Washington, DC, 20503, with copies
to  the  Internal  Revenue  Service,   Attn:  IRS  Reports  Clearance   Officer,
W:CAR:MP:FP:S,  Washington,  DC 20224. Comments on the collection of information
should be received by September 17, 2002.  Comments are  specifically  requested
concerning:

    Whether  the   collection  of   information  is  necessary  for  the  proper

                                     G-5-1
<PAGE>

performance of the functions of the Internal Revenue Service,  including whether
the information will have practical utility;

    The accuracy of the  estimated  burden  associated  with the  collection  of
information (see below);

    How the quality, utility, and clarity of the information to be
collected may be enhanced;

    How the  burden of  complying  with the  collection  of  information  may be
minimized,  including through the application of automated collection techniques
or other forms of information technology; and

    Estimates of capital or start-up costs and costs of operation,  maintenance,
and purchase of service to provide information.

    An agency  may not  conduct  or  sponsor,  and a person is not  required  to
respond to, a  collection  of  information  unless it  displays a valid  control
number assigned by the Office of Management and Budget.

    The  estimated  total  annual  reporting  burden is 470  hours,  based on an
estimated  number of respondents  of 470 and an estimated  average annual burden
hours per respondent of one hour.

    Books or records relating to a collection of information must be retained as
long as their contents may become material in the administration of any internal
revenue law. Generally, tax returns and tax return information are confidential,
as required by 26 U.S.C. 6103.

Background

    This document contains final regulations  regarding the proposed  amendments
to 26 CFR part 1 under  section  860E of the Internal  Revenue Code (Code).  The
regulations  provide the circumstances under which a transferor of a noneconomic
REMIC  residual   interest   meeting  the   investigation   and   representation
requirements  may avail  itself  of the safe  harbor by  satisfying  either  the
formula test or the asset test.

    Final regulations  governing REMICs, issued in 1992, contain rules governing
the transfer of noneconomic REMIC residual interests.  In general, a transfer of
a  noneconomic  residual  interest  is  disregarded  for all tax  purposes  if a
significant purpose of the transfer is to

[[Page 47452]]

enable the  transferor to impede the  assessment or collection of tax. A purpose
to impede the assessment or collection of tax (a wrongful purpose) exists if the
transferor,  at the time of the transfer,  either knew or should have known that
the transferee would be unwilling or unable to pay taxes due on its share of the
REMIC's taxable income.

    Under a safe harbor, the transferor of a REMIC noneconomic residual interest
is presumed not to have a wrongful  purpose if two  requirements  are satisfied:
(1) the  transferor  conducts a  reasonable  investigation  of the  transferee's
financial  condition  (the  investigation  requirement);  and (2) the transferor
secures a  representation  from the transferee to the effect that the transferee
understands the tax obligations  associated with holding a residual interest and
intends to pay those taxes (the representation requirement).

    The  IRS  and  Treasury  have  been  concerned  that  some   transferors  of
noneconomic  residual  interests  claim they  satisfy  the safe  harbor  even in
situations  where the economics of the transfer  clearly indicate the transferee
is unwilling or unable to pay the tax associated with holding the interest.  For
this reason,  on February 7, 2000, the IRS published in the Federal Register (65
FR 5807) a notice of proposed

                                     G-6-1
<PAGE>

rulemaking (REG-100276-97; REG-122450-98) designed to clarify the safe harbor by
adding the ``formula test,'' an economic test. The proposed  regulation provides
that the safe harbor is unavailable  unless the present value of the anticipated
tax liabilities  associated  with holding the residual  interest does not exceed
the sum of: (1) The present value of any  consideration  given to the transferee
to  acquire  the  interest;  (2)  the  present  value  of  the  expected  future
distributions on the interest;  and (3) the present value of the anticipated tax
savings associated with holding the interest as the REMIC generates losses.

    The notice of proposed  rulemaking also contained rules for FASITs.  Section
1.860H-6(g) of the proposed regulations  provides  requirements for transfers of
FASIT  ownership  interests  and adopts a safe harbor by  reference  to the safe
harbor provisions of the REMIC regulations.

    In January 2001, the IRS published Rev. Proc. 2001-12 (2001-3 I.R.B. 335) to
set forth an alternative  safe harbor that taxpayers could use while the IRS and
the  Treasury  considered  comments  on  the  proposed  regulations.  Under  the
alternative safe harbor, if a transferor meets the investigation requirement and
the representation  requirement but the transfer fails to meet the formula test,
the transferor  may invoke the safe harbor if the transferee  meets a two- prong
test (the asset test). A transferee generally meets the first prong of this test
if, at the time of the transfer, and in each of the two years preceding the year
of  transfer,  the  transferee's  gross  assets  exceed $100 million and its net
assets exceed $10 million. A transferee generally meets the second prong of this
test if it is a  domestic,  taxable  corporation  and agrees in  writing  not to
transfer  the  interest  to any person  other  than  another  domestic,  taxable
corporation that also satisfies the requirements of the asset test. A transferor
cannot rely on the asset test if the  transferor  knows,  or has reason to know,
that the  transferee  will not comply  with its written  agreement  to limit the
restrictions on subsequent transfers of the residual interest.

    Rev. Proc. 2001-12 provides that the asset test fails to be satisfied in the
case of a transfer or assignment of a noneconomic residual interest to a foreign
branch of an otherwise  eligible  transferee.  If such a transfer or  assignment
were permitted,  a corporate taxpayer might seek to claim that the provisions of
an  applicable  income tax treaty  would  resource  excess  inclusion  income as
foreign  source  income,  and that,  as a  consequence,  any U.S. tax  liability
attributable  to the excess  inclusion  income  could be offset by  foreign  tax
credits.  Such a claim would impede the  assessment or collection of U.S. tax on
excess inclusion income,  contrary to the congressional purpose of assuring that
such income will be taxable in all events. See, e.g., sections 860E(a)(1),  (b),
(e) and 860G(b) of the Code.

    The Treasury and the IRS have  learned that certain  taxpayers  transferring
noneconomic residual interests to foreign branches have attempted to rely on the
formula  test to obtain  safe  harbor  treatment  in an  effort  to  impede  the
assessment or collection of U.S. tax on excess  inclusion  income.  Accordingly,
the  final  regulations  provide  that if a  noneconomic  residual  interest  is
transferred  to a  foreign  permanent  establishment  or  fixed  base  of a U.S.
taxpayer,  the transfer is not eligible for safe harbor  treatment  under either
the asset  test or the  formula  test.  The  final  regulations  also  require a
transferee  to  represent  that it will not cause  income  from the  noneconomic
residual  interest to be attributable to a foreign  permanent  establishment  or

                                     G-7-1
<PAGE>

fixed base.

    Section 1.860E-1(c)(8)  provides computational rules that a taxpayer may use
to  qualify  for  safe  harbor   status   under  the   formula   test.   Section
1.860E-1(c)(8)(i)  provides that the transferee is presumed to pay tax at a rate
equal to the highest rate of tax specified in section 11(b).  Some  commentators
were  concerned that this presumed rate of taxation was too high because it does
not take into  consideration  taxpayers  subject to the alternative  minimum tax
rate. In light of the comments received,  this provision has been amended in the
final regulations to allow certain transferees that compute their taxable income
using the alternative  minimum tax rate to use the alternative  minimum tax rate
applicable to corporations.

    Additionally,  Sec.  1.860E-1(c)(8)(iii) provides that the present values in
the  formula  test  are to be  computed  using  a  discount  rate  equal  to the
applicable  Federal  short-term  rate prescribed by section  1274(d).  This is a
change  from  the  proposed   regulation  and  Rev.  Proc.   2001-12.  In  those
publications  the provision  stated that  ``present  values are computed using a
discount rate equal to the applicable Federal rate prescribed in section 1274(d)
compounded  semiannually'' and that ``[a] lower discount rate may be used if the
transferee can demonstrate that it regularly borrows, in the course of its trade
or  business,  substantial  funds at such  lower  rate from an  unrelated  third
party.'' The IRS and the Treasury  Department  have learned that,  based on this
provision,  certain taxpayers have been attempting to use unrealistically low or
zero interest rates to satisfy the formula test,  frustrating  the intent of the
test.  Furthermore,  the  Treasury  Department  and the IRS believe  that a rule
allowing  for a rate  other than a rate based on an  objective  index  would add
unnecessary complexity to the safe harbor. As a result, the rule in the proposed
regulations  that  permits a transferee  to use a lower  discount  rate,  if the
transferee can demonstrate that it regularly  borrows  substantial funds at such
lower rate, is not included in the final regulations; and the Federal short-term
rate  has  been  substituted  for  the  applicable  Federal  rate.  To  simplify
taxpayers' computations, the final regulations allow use of any of the published
short-term  rates,  provided  that  the  present  values  are  computed  with  a
corresponding  period  of  compounding.  With the  exception  of the  provisions
relating to transfers to foreign  branches,  these  changes  generally  have the
proposed  applicability  date of February 4, 2000,  but  taxpayers may choose to
apply the interest  rate formula set forth in the proposed  regulation  and Rev.
Proc. 2001-12 for transfers occurring before August 19, 2002.

    It is anticipated that when final regulations are adopted with respect to

[[Page 47453]]

FASITs,  Sec.  1.860H-6(g)  of the  proposed  regulations  will  be  adopted  in
substantially  its  present  form,  with the result  that the final  regulations
contained  in this  document  will  also  govern  transfers  of FASIT  ownership
interests with substantially the same applicability date as is contained in this
document.

Effect on Other Documents

    Rev.  Proc.  2001-12  (2001-3  I.R.B.  335) is  obsolete  for  transfers  of

                                     G-8-1
<PAGE>

noneconomic residual interests in REMICs occurring on or after August 19, 2002.

Special Analyses

    It is hereby  certified that these  regulations  will not have a significant
economic impact on a substantial number of small entities. This certification is
based  on the  fact  that it is  unlikely  that a  substantial  number  of small
entities will hold REMIC residual interests. Therefore, a Regulatory Flexibility
Analysis  under  the  Regulatory  Flexibility  Act (5 U.S.C.  chapter  6) is not
required.  It  has  been  determined  that  this  Treasury  decision  is  not  a
significant regulatory action as defined in Executive Order 12866.  Therefore, a
regulatory assessment is not required. It also has been determined that sections
553(b) and 553(d) of the  Administrative  Procedure Act (5 U.S.C.  chapter 5) do
not apply to these regulations.

Drafting Information

    The principal author of these regulations is Courtney  Shepardson.  However,
other  personnel  from the IRS and  Treasury  Department  participated  in their
development.

List of Subjects

26 CFR Part 1

    Income taxes, Reporting and record keeping requirements.

26 CFR Part 602

    Reporting and record keeping requirements.

Adoption of Amendments to the Regulations

    Accordingly, 26 CFR parts 1 and 602 are amended as follows:

PART 1--INCOME TAXES

    Paragraph 1. The authority  citation for part 1 continues to read in part as
follows:

    Authority: 26 U.S.C. 7805 * * *

                                     G-9-1
<PAGE>

                                   EXHIBIT G-2

                         FORM OF TRANSFEROR CERTIFICATE

                                ___________________, 20__

Residential Accredit Loans, Inc.
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, Minnesota  55437

__________________
__________________
__________________

Attention:  Residential Funding Company, LLC Series ____-___

            Re:   Mortgage Asset-Backed Pass-Through Certificates,
                  Series ____-___, Class R

Ladies and Gentlemen:

            This letter is delivered to you in  connection  with the transfer by
____________________  (the "Seller") to __________________  (the "Purchaser") of
$____________  Initial  Certificate  Principal Balance of Mortgage  Asset-Backed
Pass-Through  Certificates,  Series  ____-___,  Class  R  (the  "Certificates"),
pursuant to Section 5.02 of the Pooling and  Servicing  Agreement  (the "Pooling
and Servicing  Agreement"),  dated as of ___________  1, ____ among  Residential
Accredit Loans,  Inc., as seller (the "Company"),  Residential  Funding Company,
LLC, as master  servicer (the "Master  Servicer"),  and  __________________,  as
trustee (the "Trustee").  All terms used herein and not otherwise  defined shall
have the meanings set forth in the Pooling and Servicing  Agreement.  The Seller
hereby  certifies,  represents and warrants to, and covenants  with, the Company
and the Trustee that:

            1.  No  purpose  of  the  Seller  relating  to the  transfer  of the
Certificate  by  the  Seller  to the  Purchaser  is or  will  be to  impede  the
assessment or collection of any tax.

            2. The Seller  understands  that the  Purchaser has delivered to the
Trustee and the Master  Servicer a transfer  affidavit and agreement in the form
attached to the Pooling and Servicing  Agreement as Exhibit G-1. The Seller does
not know or believe that any representation contained therein is false.

            3. The Seller has at the time of the transfer conducted a reasonable
investigation  of the financial  condition of the Purchaser as  contemplated  by
Treasury  Regulations  Section  1.860E-1(c)(4)(i)  and,  as  a  result  of  that
investigation,  the Seller has  determined  that the Purchaser has  historically
paid its debts as they  become  due and has  found no  significant  evidence  to
indicate that the Purchaser will not continue to pay its debts as they

                                     G-2-1
<PAGE>

become due in the future.  The Seller understands that the transfer of a Class R
Certificate  may not be respected for United States income tax purposes (and the
Seller may  continue  to be liable for United  States  income  taxes  associated
therewith) unless the Seller has conducted such an investigation.

            4. The Seller has no actual  knowledge that the proposed  Transferee
is not both a United States Person and a Permitted Transferee.

                                      Very truly yours,

                                      ___________________________________
                                      (Seller)

                                      By: _______________________________
                                      Name: _____________________________
                                      Title: ____________________________

                                     G-2-2
<PAGE>

                                    EXHIBIT H

                     FORM OF INVESTOR REPRESENTATION LETTER

                                                _______________, 20__

Residential Accredit Loans, Inc.
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, MN 55437

__________________
__________________
__________________

Residential Funding Company, LLC
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, MN  55437

Attention:  Residential Funding Company, LLC Series ____-___

            RE:   Mortgage Asset-Backed Pass-Through Certificates,
                  Series ____-___, [Class B-]

Ladies and Gentlemen:

            __________________________________________ (the "Purchaser") intends
to purchase from  _______________  (the  "Seller")  $__________________  Initial
Certificate   Principal   Balance   of   Mortgage   Asset-Backed    Pass-Through
Certificates,  Series ____-___,  Class (the "Certificates"),  issued pursuant to
the Pooling and Servicing  Agreement  (the  "Pooling and Servicing  Agreement"),
dated as of  ___________  1, ____ among  Residential  Accredit  Loans,  Inc., as
seller (the "Company"),  Residential  Funding  Company,  LLC, as master servicer
(the "Master Servicer"), and __________________, as trustee (the "Trustee"). All
terms used herein and not otherwise defined shall have the meanings set forth in
the Pooling and Servicing Agreement. The Purchaser hereby certifies,  represents
and warrants to, and  covenants  with,  the Company,  the Trustee and the Master
Servicer that:

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

<PAGE>

            the transfer of the Certificates and (e) the Certificates  will bear
            a legend to the foregoing effect.

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

                  3.  The   Purchaser  is  (a)  a   substantial,   sophisticated
            institutional  investor  having such  knowledge  and  experience  in
            financial and business matters, and, in particular,  in such matters
            related to securities  similar to the Certificates,  such that it is
            capable of  evaluating  the merits  and risks of  investment  in the
            Certificates,  (b)  able  to  bear  the  economic  risks  of such an
            investment  and (c) an "accredited  investor"  within the meaning of
            Rule 501(a) promulgated pursuant to the Act.

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

                  5. The Purchaser has not and will not nor has it authorized or
            will it authorize any person to (a) offer,  pledge, sell, dispose of
            or  otherwise   transfer  any  Certificate,   any  interest  in  any
            Certificate  or any  other  similar  security  to any  person in any
            manner,  (b)  solicit  any  offer  to buy  or to  accept  a  pledge,
            disposition  of other transfer of any  Certificate,  any interest in
            any Certificate or any other similar security from any person in any
            manner,  (c)  otherwise  approach or  negotiate  with respect to any
            Certificate,  any interest in any  Certificate  or any other similar
            security  with any  person  in any  manner,  (d)  make  any  general
            solicitation by means of general  advertising or in any other manner
            or (e) take any

                                      H-2
<PAGE>

            other  action,  that  (as to any of (a)  through  (e)  above)  would
            constitute a  distribution  of any  Certificate  under the Act, that
            would  render the  disposition  of any  Certificate  a violation  of
            Section  5 of the Act or any state  securities  law,  or that  would
            require   registration  or  qualification   pursuant  thereto.   The
            Purchaser   will  not  sell  or   otherwise   transfer  any  of  the
            Certificates,  except  in  compliance  with  the  provisions  of the
            Pooling and Servicing Agreement.

               6. The Purchaser

                  (a) is not an  employee  benefit or other plan  subject to the
            prohibited  transaction provisions of the Employee Retirement Income
            Security Act of 1974, as amended  ("ERISA"),  or Section 4975 of the
            Internal  Revenue Code of 1986, as amended (a "Plan"),  or any other
            person  (including an  investment  manager,  a named  fiduciary or a
            trustee of any Plan) acting, directly or indirectly, on behalf of or
            purchasing any Certificate with "plan assets" of any Plan within the
            meaning of the  Department of Labor ("DOL")  regulation at 29 C.F.R.
            ss.2510.3-101, as modified by Section 3(42) of ERISA; or

                  (b) is an insurance company, the source of funds to be used by
            it to purchase the  Certificates  is an "insurance  company  general
            account"  (within the meaning of DOL  Prohibited  Transaction  Class
            Exemption  ("PTCE")  95-60),  and  the  purchase  is  being  made in
            reliance  upon the  availability  of the exemptive  relief  afforded
            under Sections I and III of PTCE 95-60.

      In addition,  the Purchaser hereby certifies,  represents and warrants to,
and covenants  with, the Company,  the Trustee and the Master  Servicer that the
Purchaser will not transfer such  Certificates to any Plan or person unless such
Plan or person meets the requirements set forth in either 6(a) or (b) above.

                                      Very truly yours,

                                      ________________________________

                                      By: ____________________________
                                      Name: __________________________
                                      Title: _________________________

                                      H-3
<PAGE>

                                    EXHIBIT I

                    FORM OF TRANSFEROR REPRESENTATION LETTER

                                                             _____________, 20__

Residential Accredit Loans, Inc.
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, MN 55437

__________________
__________________
__________________

Attention: Residential Funding Company, LLC Series ____-___

            Re:   Mortgage Asset-Backed Pass-Through Certificates,
                  Series ____-___, [Class B-]

Ladies and Gentlemen:

            In connection  with the sale by ________  (the  "Seller") to _______
(the  "Purchaser")  of $  Initial  Certificate  Principal  Balance  of  Mortgage
Asset-Backed   Pass-Through   Certificates,    Series   ____-___,   Class   (the
"Certificates"),  issued  pursuant to the Pooling and Servicing  Agreement  (the
"Pooling  and  Servicing  Agreement"),  dated as of  ___________  1, ____  among
Residential Accredit Loans, Inc., as seller (the "Company"), Residential Funding
Company,  LLC,  as master  servicer,  and  __________________,  as trustee  (the
"Trustee").  The  Seller  hereby  certifies,  represents  and  warrants  to, and
covenants with, the Company and the Trustee that:

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

<PAGE>

                                      Very truly yours,

                                      __________________________________
                                      (Seller)

                                      By: ____________________________
                                      Name: __________________________
                                      Title: _________________________

                                      I-2
<PAGE>

                                    EXHIBIT J

                  [FORM OF RULE 144A INVESTMENT REPRESENTATION]

             Description of Rule 144A Securities, including numbers:

           _________________________________________________________

           _________________________________________________________

           _________________________________________________________

           _________________________________________________________

            The undersigned seller, as registered holder (the "Seller"), intends
to transfer the Rule 144A Securities  described  above to the undersigned  buyer
(the "Buyer").

            1. In  connection  with such  transfer  and in  accordance  with the
agreements  pursuant to which the Rule 144A Securities  were issued,  the Seller
hereby  certifies the following  facts:  Neither the Seller nor anyone acting on
its behalf has offered, transferred,  pledged, sold or otherwise disposed of the
Rule 144A  Securities,  any  interest in the Rule 144A  Securities  or any other
similar security to, or solicited any offer to buy or accept a transfer,  pledge
or other disposition of the Rule 144A Securities,  any interest in the Rule 144A
Securities  or any other  similar  security  from,  or otherwise  approached  or
negotiated  with respect to the Rule 144A  Securities,  any interest in the Rule
144A Securities or any other similar security with, any person in any manner, or
made any general  solicitation  by means of general  advertising or in any other
manner,  or taken any other action,  that would constitute a distribution of the
Rule 144A  Securities  under the  Securities  Act of 1933, as amended (the "1933
Act"),  or that  would  render the  disposition  of the Rule 144A  Securities  a
violation of Section 5 of the 1933 Act or require registration pursuant thereto,
and that the Seller has not offered the Rule 144A Securities to any person other
than the Buyer or  another  "qualified  institutional  buyer" as defined in Rule
144A under the 1933 Act.

            2. The Buyer  warrants and  represents  to, and covenants  with, the
Seller,  the  Trustee  and the Master  Servicer  (as  defined in the Pooling and
Servicing  Agreement  (the  "Agreement"),  dated as of ___________ 1, ____ among
Residential Funding Company, LLC as Master Servicer, Residential Accredit Loans,
Inc.   as   depositor   pursuant   to  Section   5.02  of  the   Agreement   and
__________________, as trustee, as follows:

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

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

<PAGE>

                  (c)  The  Buyer  has  been  furnished  with  all   information
      regarding the Rule 144A  Securities that it has requested from the Seller,
      the Trustee or the Servicer.

                  (d)  Neither  the Buyer nor  anyone  acting on its  behalf has
      offered, transferred, pledged, sold or otherwise disposed of the Rule 144A
      Securities,  any interest in the Rule 144A Securities or any other similar
      security to, or solicited any offer to buy or accept a transfer, pledge or
      other  disposition of the Rule 144A  Securities,  any interest in the Rule
      144A  Securities  or  any  other  similar   security  from,  or  otherwise
      approached or  negotiated  with respect to the Rule 144A  Securities,  any
      interest in the Rule 144A  Securities or any other similar  security with,
      any person in any  manner,  or made any general  solicitation  by means of
      general  advertising  or in any other  manner,  or taken any other action,
      that would constitute a distribution of the Rule 144A Securities under the
      1933 Act or that would render the  disposition of the Rule 144A Securities
      a violation of Section 5 of the 1933 Act or require registration  pursuant
      thereto,  nor will it act, nor has it  authorized or will it authorize any
      person to act, in such manner with respect to the Rule 144A Securities.

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

            [3. The Buyer

                  [(a) is not an employee  benefit or other plan  subject to the
      prohibited  transaction  provisions  of  the  Employee  Retirement  Income
      Security  Act of  1974,  as  amended  ("ERISA"),  or  Section  4975 of the
      Internal Revenue Code of 1986, as amended (a "Plan"),  or any other person
      (including an investment  manager,  a named  fiduciary or a trustee of any
      Plan)  acting,  directly or  indirectly,  on behalf of or  purchasing  any
      Certificate  with  "plan  assets" of any Plan  within  the  meaning of the
      Department of Labor ("DOL")  regulation at 29 C.F.R.  ss.  2510.3-101,  as
      modified by Section 3(42) of ERISA]1; or

                  (b) is an insurance company, the source of funds to be used by
      it to purchase the Certificates is an "insurance  company general account"
      (within the meaning of DOL Prohibited Transaction Class Exemption ("PTCE")
      95-60),  and the purchase is
----------
1 Only paragraph (a) for Class P Certificates.

                                      J-2
<PAGE>

      being made in  reliance  upon the  availability  of the  exemptive  relief
      afforded under Sections I and III of PTCE 95-60.]2

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

            IN WITNESS  WHEREOF,  each of the parties has executed this document
as of the date set forth below.

__________________________________         ____________________________________
Print Name of Seller                       Print Name of Buyer

By: ______________________________         By: ________________________________
    Name:                                      Name:
    Title:                                     Title:

Taxpayer Identification                    Taxpayer Identification:

No. ______________________________         No: ________________________________

Date: ____________________________         Date: ______________________________

----------
2 Class B Certificateholders may represent to either (a) or (b).

                                      J-3
<PAGE>

                                                            ANNEX 1 TO EXHIBIT J

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

             [For Buyers Other Than Registered Investment Companies]

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

            1. As indicated  below,  the  undersigned  is the  President,  Chief
Financial  Officer,  Senior Vice  President  or other  executive  officer of the
Buyer.

            2. In  connection  with  purchases  by the  Buyer,  the  Buyer  is a
"qualified  institutional  buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because (i) the Buyer owned and/or invested
on a  discretionary  basis $         in  securities  (except  for  the  excluded
securities  referred to below) as of the end of the Buyer's  most recent  fiscal
year (such amount being  calculated in  accordance  with Rule 144A) and (ii) the
Buyer satisfies the criteria in the category marked below.

      --    Corporation,  etc.  The Buyer is a  corporation  (other than a bank,
            savings and loan association or similar institution),  Massachusetts
            or similar business trust,  partnership,  or charitable organization
            described in Section 501(c)(3) of the Internal Revenue Code.

      --    Bank.  The  Buyer  (a) is a  national  bank or  banking  institution
            organized under the laws of any State,  territory or the District of
            Columbia, the business of which is substantially confined to banking
            and is supervised by the State or territorial  banking commission or
            similar official or is a foreign bank or equivalent institution, and
            (b) has an audited net worth of at least $25,000,000 as demonstrated
            in its  latest  annual  financial  statements,  a copy of  which  is
            attached hereto.

      --    Savings and Loan.  The Buyer (a) is a savings and loan  association,
            building  and  loan   association,   cooperative   bank,   homestead
            association or similar institution, which is supervised and examined
            by a State or Federal  authority  having  supervision  over any such
            institutions  or  is a  foreign  savings  and  loan  association  or
            equivalent  institution and (b) has an audited net worth of at least
            $25,000,000  as   demonstrated   in  its  latest  annual   financial
            statements.

      --    Broker-Dealer.  The Buyer is a dealer registered pursuant to Section
            15 of the Securities Exchange Act of 1934.

      --    Insurance  Company.  The Buyer is an insurance company whose primary
            and predominant business activity is the writing of insurance or the
            reinsuring of risks underwritten by insurance companies and which is
            subject to  supervision by the insurance  commissioner  or a similar
            official  or  agency  of a State or  territory  or the  District  of
            Columbia.

<PAGE>

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

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

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

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

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

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

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

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

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

<PAGE>

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

            6. If the answer to the foregoing question is "no", the Buyer agrees
that,  in connection  with any purchase of securities  sold to the Buyer for the
account of a third party  (including  any separate  account) in reliance on Rule
144A,  the Buyer will only purchase for the account of a third party that at the
time is a "qualified  institutional  buyer"  within the meaning of Rule 144A. In
addition,  the Buyer  agrees that the Buyer will not purchase  securities  for a
third party unless the Buyer has obtained a current  representation  letter from
such third party or taken other appropriate  steps  contemplated by Rule 144A to
conclude that such third party  independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.

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

                                      _________________________________
                                      Print Name of Buyer

                                      By: _____________________________
                                          Name:
                                          Title:

                                      Date:_____________________________

<PAGE>

                                                            ANNEX 2 TO EXHIBIT J

            QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A

              [For Buyers That Are Registered Investment Companies]

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

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

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

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

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

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

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

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

<PAGE>

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

                                      _________________________________
                                      Print Name of Buyer

                                      By: _____________________________
                                          Name: _______________________
                                          Title: ______________________

                                      IF AN ADVISER:

                                      _________________________________
                                      Print Name of Buyer

                                      Date: ___________________________

<PAGE>

                                    EXHIBIT K

                   [TEXT OF AMENDMENT TO POOLING AND SERVICING
                  AGREEMENT PURSUANT TO SECTION 11.01(E) FOR A
                                LIMITED GUARANTY]

                                  ARTICLE XIII

Subordinate Certificate Loss Coverage; Limited Guaranty

            Section  13.01.  Subordinate  Certificate  Loss  Coverage;   Limited
Guaranty.  (a) Subject to subsection (c) below,  prior to the later of the third
Business Day prior to each Distribution Date or the related  Determination Date,
the Master  Servicer  shall  determine  whether it or any  Sub-Servicer  will be
entitled to any  reimbursement  pursuant to Section 4.02(a) on such Distribution
Date for Advances or Sub-Servicer  Advances  previously made, (which will not be
Advances or Sub-Servicer  Advances that were made with respect to  delinquencies
which were  subsequently  determined to be Excess Special Hazard Losses,  Excess
Fraud Losses,  Excess Bankruptcy Losses or Extraordinary Losses) and, if so, the
Master Servicer shall demand payment from Residential Funding of an amount equal
to the amount of any Advances or Sub-Servicer  Advances  reimbursed  pursuant to
Section 4.02(a),  to the extent such Advances or Sub-Servicer  Advances have not
been included in the amount of the Realized Loss in the related  Mortgage  Loan,
and  shall  distribute  the same to the Class B  Certificateholders  in the same
manner as if such amount were to be distributed pursuant to Section 4.02(a).

            (b) Subject to subsection (c) below, prior to the later of the third
Business Day prior to each Distribution Date or the related  Determination Date,
the Master  Servicer  shall  determine  whether any Realized  Losses (other than
Excess Special Hazard Losses,  Excess Bankruptcy Losses, Excess Fraud Losses and
Extraordinary  Losses)  will be allocated  to the Class B  Certificates  on such
Distribution  Date  pursuant to Section  4.05,  and, if so, the Master  Servicer
shall demand  payment from  Residential  Funding of the amount of such  Realized
Loss and shall distribute the same to the Class B Certificateholders in the same
manner as if such amount  were to be  distributed  pursuant to Section  4.02(a);
provided, however, that the amount of such demand in respect of any Distribution
Date shall in no event be greater than the sum of (i) the  additional  amount of
Accrued  Certificate  Interest  that  would  have  been  paid  for  the  Class B
Certificateholders  on such  Distribution  Date had such Realized Loss or Losses
not occurred plus (ii) the amount of the reduction in the Certificate  Principal
Balances  of the  Class B  Certificates  on such  Distribution  Date due to such
Realized  Loss or Losses.  Notwithstanding  such payment,  such Realized  Losses
shall be deemed to have been borne by the  Certificateholders  for  purposes  of
Section  4.05.  Excess  Special  Hazard  Losses,  Excess  Fraud  Losses,  Excess
Bankruptcy Losses and Extraordinary Losses allocated to the Class B Certificates
will not be covered by the Subordinate Certificate Loss Obligation.

            (c) Demands for  payments  pursuant  to this  Section  shall be made
prior to the later of the third Business Day prior to each  Distribution Date or
the  related  Determination  Date by the Master  Servicer  with  written  notice
thereof to the Trustee.  The maximum  amount that  Residential  Funding shall be
required to pay pursuant to this Section on any Distribution Date

<PAGE>

(the  "Amount  Available")  shall be equal to the lesser of (X) minus the sum of
(i) all previous payments made under subsections (a) and (b) hereof and (ii) all
draws  under the Limited  Guaranty  made in lieu of such  payments as  described
below in  subsection  (d) and (Y) the  then  outstanding  Certificate  Principal
Balances of the Class B Certificates, or such lower amount as may be established
pursuant to Section  13.02.  Residential  Funding's  obligations as described in
this  Section  are  referred  to herein  as the  "Subordinate  Certificate  Loss
Obligation."

            (d) The  Trustee  will  promptly  notify  GMAC LLC of any failure of
Residential  Funding to make any payments  hereunder  and shall  demand  payment
pursuant to the limited guaranty (the "Limited Guaranty"), executed by GMAC LLC,
of Residential  Funding's  obligation to make payments pursuant to this Section,
in an amount  equal to the  lesser  of (i) the  Amount  Available  and (ii) such
required  payments,  by delivering  to GMAC LLC a written  demand for payment by
wire transfer,  not later than the second Business Day prior to the Distribution
Date for such month, with a copy to the Master Servicer.

            (e)  All  payments  made by  Residential  Funding  pursuant  to this
Section or amounts paid under the Limited  Guaranty shall be deposited  directly
in the Certificate  Account,  for distribution on the Distribution Date for such
month to the Class B Certificateholders.

            (f) The Company shall have the option,  in its sole  discretion,  to
substitute  for  either  or  both of the  Limited  Guaranty  or the  Subordinate
Certificate  Loss  Obligation  another  instrument  in the  form of a  corporate
guaranty,  an irrevocable  letter of credit, a surety bond,  insurance policy or
similar  instrument  or a reserve fund;  provided  that (i) the Company  obtains
(subject to the provisions of Section 10.01(f) as if the Company was substituted
for the Master Servicer solely for the purposes of such provision) an Opinion of
Counsel (which need not be an opinion of Independent counsel) to the effect that
obtaining such  substitute  corporate  guaranty,  irrevocable  letter of credit,
surety bond,  insurance  policy or similar  instrument  or reserve fund will not
cause  either (a) any  federal  tax to be imposed on the Trust  Fund,  including
without limitation,  any federal tax imposed on "prohibited  transactions" under
Section  860(F)(a)(1) of the Code or on  "contributions  after the startup date"
under Section  860(G)(d)(1) of the Code or (b) the Trust Fund to fail to qualify
as a REMIC at any time that any  Certificate  is  outstanding,  and (ii) no such
substitution  shall  be made  unless  (A) the  substitute  Limited  Guaranty  or
Subordinate  Certificate  Loss Obligation is for an initial amount not less than
the then  current  Amount  Available  and  contains  provisions  that are in all
material  respects  equivalent to the original  Limited  Guaranty or Subordinate
Certificate   Loss   Obligation   (including   that  no  portion  of  the  fees,
reimbursements  or other  obligations under any such instrument will be borne by
the Trust  Fund),  (B) the long  term debt  obligations  of any  obligor  of any
substitute  Limited Guaranty or Subordinate  Certificate Loss Obligation (if not
supported by the Limited Guaranty) shall be rated at least the lesser of (a) the
rating of the long term debt  obligations of GMAC LLC as of the date of issuance
of the Limited  Guaranty and (b) the rating of the long term debt obligations of
GMAC LLC at the date of such  substitution  and (C) the Company  obtains written
confirmation from each nationally recognized credit rating agency that rated the
Class B Certificates at the request of the Company that such substitution  shall
not lower the  rating on the Class B  Certificates  below the  lesser of (a) the
then-current  rating  assigned to the Class B Certificates by such rating agency
and (b) the original  rating assigned to the Class B Certificates by such rating
agency. Any replacement of the Limited Guaranty or Subordinate  Certificate Loss
Obligation pursuant to this Section shall be accompanied by a written Opinion of
Counsel to the substitute

                                      K-2
<PAGE>

guarantor  or obligor,  addressed to the Master  Servicer and the Trustee,  that
such substitute instrument  constitutes a legal, valid and binding obligation of
the substitute  guarantor or obligor,  enforceable in accordance with its terms,
and concerning  such other matters as the Master  Servicer and the Trustee shall
reasonably  request.  Neither the Company,  the Master  Servicer nor the Trustee
shall be  obligated  to  substitute  for or  replace  the  Limited  Guaranty  or
Subordinate Certificate Loss Obligation under any circumstance.

            Section  13.02.   Amendments   Relating  to  the  Limited  Guaranty.
Notwithstanding Sections 11.01 or 13.01: (i) the provisions of this Article XIII
may be amended,  superseded or deleted, (ii) the Limited Guaranty or Subordinate
Certificate Loss Obligation may be amended,  reduced or canceled,  and (iii) any
other  provision of this Agreement which is related or incidental to the matters
described  in this  Article  XIII may be amended in any manner;  in each case by
written  instrument  executed or  consented  to by the  Company and  Residential
Funding but without the consent of any Certificateholder and without the consent
of the Master  Servicer or the Trustee being required  unless any such amendment
would impose any  additional  obligation on, or otherwise  adversely  affect the
interests of, the Master Servicer or the Trustee,  as applicable;  provided that
the Company shall also obtain a letter from each  nationally  recognized  credit
rating agency that rated the Class B Certificates  at the request of the Company
to the effect that such amendment,  reduction, deletion or cancellation will not
lower  the  rating  on the  Class B  Certificates  below  the  lesser of (a) the
then-current  rating  assigned to the Class B Certificates by such rating agency
and (b) the original  rating assigned to the Class B Certificates by such rating
agency, unless (A) the Holder of 100% of the Class B Certificates is Residential
Funding  or  an  Affiliate  of  Residential  Funding,  or  (B)  such  amendment,
reduction,  deletion or cancellation is made in accordance with Section 11.01(e)
and,  provided  further that the Company  obtains  (subject to the provisions of
Section  10.01(f)  as if the  Company was  substituted  for the Master  Servicer
solely for the purposes of such provision),  in the case of a material amendment
or  supercession  (but not a reduction,  cancellation or deletion of the Limited
Guaranty or the Subordinate Certificate Loss Obligation),  an Opinion of Counsel
(which  need not be an opinion of  Independent  counsel)  to the effect that any
such amendment or  supercession  will not cause either (a) any federal tax to be
imposed on the Trust Fund, including without limitation, any federal tax imposed
on  "prohibited  transactions"  under  Section  860F(a)(1)  of  the  Code  or on
"contributions  after the startup date" under Section  860G(d)(1) of the Code or
(b) the  Trust  Fund to  fail  to  qualify  as a  REMIC  at any  time  that  any
Certificate is outstanding.  A copy of any such instrument  shall be provided to
the Trustee and the Master  Servicer  together  with an Opinion of Counsel  that
such amendment complies with this Section 13.02.

                                      K-3
<PAGE>

                                    EXHIBIT L

                           [FORM OF LIMITED GUARANTY]

                                LIMITED GUARANTY

                        RESIDENTIAL ACCREDIT LOANS, INC.

                 Mortgage Asset-Backed Pass-Through Certificates
                                 Series ____-___

                                                               ___________, 200_

__________________
__________________
__________________

Attention:  Residential Funding Company, LLC Series ____-___

Ladies and Gentlemen:

            WHEREAS,  Residential  Funding  Company,  LLC,  a  Delaware  limited
liability company ("Residential  Funding"),  an indirect wholly-owned subsidiary
of GMAC LLC, a  Delaware  limited  liability  company  ("GMAC"),  plans to incur
certain  obligations  as  described  under  Section  13.01  of the  Pooling  and
Servicing Agreement dated as of ___________ 1, ____ (the "Servicing Agreement"),
among Residential Accredit Loans, Inc. (the "Company"),  Residential Funding and
__________________ (the "Trustee") as amended by Amendment No. thereto, dated as
of , with respect to the Mortgage Asset-Backed Pass-Through Certificates, Series
____-___ (the "Certificates"); and

            WHEREAS,  pursuant  to  Section  13.01 of the  Servicing  Agreement,
Residential  Funding  agrees  to make  payments  to the  Holders  of the Class B
Certificates  with respect to certain  losses on the Mortgage Loans as described
in the Servicing Agreement; and

            WHEREAS,  GMAC desires to provide certain assurances with respect to
the ability of Residential  Funding to secure sufficient funds and faithfully to
perform its Subordinate Certificate Loss Obligation;

            NOW THEREFORE, in consideration of the premises herein contained and
certain  other good and valuable  consideration,  the receipt of which is hereby
acknowledged, GMAC agrees as follows:

            1. Provision of Funds.  (a) GMAC agrees to contribute and deposit in
the Certificate  Account on behalf of Residential  Funding (or otherwise provide
to  Residential  Funding,  or to  cause  to be  made  available  to  Residential
Funding),  either  directly  or through a  subsidiary,  in any case prior to the
related Distribution Date, such moneys as may be required by

<PAGE>

Residential Funding to perform its Subordinate  Certificate Loss Obligation when
and as the same  arises  from time to time upon the  demand  of the  Trustee  in
accordance with Section 13.01 of the Servicing Agreement.

            (b) The  agreement  set forth in the  preceding  clause (a) shall be
absolute,  irrevocable  and  unconditional  and  shall  not be  affected  by the
transfer by GMAC or any other person of all or any part of its or their interest
in Residential  Funding,  by any  insolvency,  bankruptcy,  dissolution or other
proceeding affecting  Residential Funding or any other person, by any defense or
right of  counterclaim,  set-off  or  recoupment  that  GMAC  may  have  against
Residential  Funding or any other  person or by any other fact or  circumstance.
Notwithstanding  the  foregoing,  GMAC's  obligations  under  clause  (a)  shall
terminate  upon  the  earlier  of (x)  substitution  for this  Limited  Guaranty
pursuant to Section 13.01(f) of the Servicing Agreement,  or (y) the termination
of the Trust Fund pursuant to the Servicing Agreement.

            2.  Waiver.  GMAC hereby  waives any failure or delay on the part of
Residential  Funding,  the Trustee or any other person in asserting or enforcing
any  rights or in making  any  claims or demands  hereunder.  Any  defective  or
partial  exercise of any such  rights  shall not  preclude  any other or further
exercise  of  that  or  any  other  such  right.  GMAC  further  waives  demand,
presentment,  notice of default,  protest,  notice of  acceptance  and any other
notices with respect to this Limited Guaranty,  including,  without  limitation,
those of action or nonaction on the part of Residential Funding or the Trustee.

            3.  Modification,  Amendment and Termination.  This Limited Guaranty
may be modified, amended or terminated only by the written agreement of GMAC and
the Trustee and only if such modification, amendment or termination is permitted
under Section 13.02 of the Servicing  Agreement.  The  obligations of GMAC under
this  Limited  Guaranty  shall  continue  and  remain  in  effect so long as the
Servicing  Agreement is not modified or amended in any way that might affect the
obligations  of GMAC under  this  Limited  Guaranty  without  the prior  written
consent of GMAC.

            4. Successor.  Except as otherwise  expressly  provided herein,  the
guarantee  herein  set  forth  shall be  binding  upon  GMAC and its  respective
successors.

            5.  Governing  Law. This Limited  Guaranty  shall be governed by the
laws of the State of New York.

            6. Authorization and Reliance.  GMAC understands that a copy of this
Limited  Guaranty  shall be  delivered  to the  Trustee in  connection  with the
execution  of  Amendment  No.  1 to the  Servicing  Agreement  and  GMAC  hereby
authorizes  the Company and the Trustee to rely on the covenants and  agreements
set forth herein.

            7.  Definitions.  Capitalized  terms used but not otherwise  defined
herein shall have the meaning given them in the Servicing Agreement.

            8. Counterparts. This Limited Guaranty may be executed in any number
of  counterparts,  each of which  shall be  deemed  to be an  original  and such
counterparts shall constitute but one and the same instrument.

                                      L-2
<PAGE>

            IN WITNESS  WHEREOF,  GMAC has caused  this  Limited  Guaranty to be
executed and delivered by its respective  officers  thereunto duly authorized as
of the day and year first above written.

                                      GMAC LLC

                                      By: __________________________
                                      Name: ________________________
                                      Title: _______________________

Acknowledged by:

__________________,
     as Trustee

By: __________________________
Name: ________________________
Title: _______________________

RESIDENTIAL ACCREDIT LOANS, INC.

By: __________________________
Name: ________________________
Title: _______________________

                                      L-3
<PAGE>

                                    EXHIBIT M

          FORM OF LENDER CERTIFICATION FOR ASSIGNMENT OF MORTGAGE LOAN

                                                            ______________, 20__

Residential Accredit Loans, Inc.
8400 Normandale Lake Boulevard
Suite 250
Minneapolis, Minnesota  55437

__________________
__________________
__________________

Attention:  Residential Funding Company, LLC Series ____-___

            Re:   Mortgage Asset-Backed Pass-Through Certificates,
                  Series ____-___ Assignment of Mortgage Loan

Ladies and Gentlemen:

            This letter is delivered to you in connection with the assignment by
_________  (the  "Trustee")  to  _________  (the  "Lender")  of  _________  (the
"Mortgage  Loan")  pursuant  to Section  3.13(d) of the  Pooling  and  Servicing
Agreement  (the "Pooling and Servicing  Agreement"),  dated as of ___________ 1,
____  among  Residential  Accredit  Loans,  Inc.,  as  seller  (the  "Company"),
Residential Funding Company, LLC, as Master Servicer, and the Trustee. All terms
used herein and not  otherwise  defined shall have the meanings set forth in the
Pooling and Servicing  Agreement.  The Lender hereby  certifies,  represents and
warrants to, and covenants with, the Master Servicer and the Trustee that:

      (i) the  Mortgage  Loan is  secured  by  Mortgaged  Property  located in a
jurisdiction  in which an  assignment  in lieu of  satisfaction  is  required to
preserve lien priority,  minimize or avoid mortgage recording taxes or otherwise
comply with, or facilitate a refinancing under, the laws of such jurisdiction;

      (ii)  the  substance  of the  assignment  is,  and is  intended  to be,  a
refinancing  of such Mortgage Loan and the form of the  transaction is solely to
comply with, or facilitate the transaction under, such local laws;

      (iii) the Mortgage Loan following the proposed assignment will be modified
to have a rate of  interest  at least  0.25  percent  below or above the rate of
interest on such Mortgage Loan prior to such proposed assignment; and

      (iv) such  assignment is at the request of the borrower  under the related
Mortgage Loan.

<PAGE>

                                      Very truly yours,

                                      ______________________________
                                      (Lender)

                                      By: __________________________
                                      Name: ________________________
                                      Title: _______________________

                                      M-2
<PAGE>

                                    EXHIBIT N

                          FORM OF REQUEST FOR EXCHANGE

                                                                          [DATE]

__________________
__________________
__________________

            Re:   Residential Accredit Loans, Inc.,
                  Mortgage Asset-Backed Pass-Through Certificates,
                  Series ____-___

            Residential  Funding  Company,  LLC, as the Holder of a % Percentage
Interest of the [Interest Only/Class A-V][-1] Certificates,  hereby requests the
Trustee  to  exchange  the  above-referenced  Certificates  for  the  Subclasses
referred to below:

            1.    [Interest Only/Class A-V]- Certificates,  corresponding to the
                  following   Uncertificated  REMIC  Regular  Interests:   [List
                  numbers  corresponding  to the  related  loans and Pool  Strip
                  Rates from the Mortgage Loan Schedule].  The initial  Subclass
                  Notional  Amount  and  the  Initial  Pass-Through  Rate on the
                  [Interest  Only/Class  A-V]-  Certificates  will  be $________
                  and _____%, respectively.

            2.    [Repeat as appropriate.]

            The Subclasses  requested  above will represent in the aggregate all
of the  Uncertificated  REMIC  Regular  Interests  represented  by the [Interest
Only/Class A-V][-1] Certificates surrendered for exchange.

            All  capitalized  terms used but not defined  herein  shall have the
meanings  set  forth  in  the  Pooling  and  Servicing  Agreement,  dated  as of
___________ 1, ____, among Residential Accredit Loans, Inc., Residential Funding
Company, LLC and __________________, as trustee.

                                      RESIDENTIAL FUNDING COMPANY, LLC

                                      By: __________________________
                                      Name:
                                      Title:

<PAGE>

                                    EXHIBIT O

                         Form of Form 10-K Certification

      I, [identify the certifying individual], certify that:

      1. I have  reviewed  this report on Form 10-K and all reports on Form 10-D
required  to be filed in respect of the  period  covered by this  report on Form
10-K of the trust (the "Exchange Act periodic  reports") created pursuant to the
Series Supplement dated ___________________ to the Standard Terms of Pooling and
Servicing Agreement dated  ____________________  (together, the "P&S Agreement")
among Residential  Accredit Loans, Inc.,  Residential Funding Company,  LLC (the
"Master Servicer") and [Name of Trustee] (the "Trustee");

      2. Based on my knowledge,  the Exchange Act periodic  reports,  taken as a
whole, do not contain any untrue statement of a material fact or omit to state a
material  fact  necessary  to  make  the  statements   made,  in  light  of  the
circumstances under which such statements were made, not misleading with respect
to the period covered by this report;

      3. Based on my  knowledge,  all of the  distribution,  servicing and other
information  required to be provided  under Form 10-D for the period  covered by
this report is included in the Exchange Act periodic reports;

      4. I am responsible  for reviewing the activities  performed by the Master
Servicer  and based on my  knowledge  and the  compliance  review  conducted  in
preparing the servicer  compliance  statement required in this report under Item
1123 of  Regulation  AB, and except a disclosed  in the  Exchange  Act  periodic
reports,  the  Master  Servicer  has  fulfilled  its  obligations  under the P&S
Agreement; and

      5. All of the reports on assessment of compliance with servicing  criteria
for asset-backed  securities and their related attestation reports on assessment
of compliance with servicing criteria for asset-backed securities required to be
included  in this  report in  accordance  with Item  1122 of  Regulation  AB and
Exchange  Act Rules  13a-18 and 15d-18 have been  included as an exhibit to this
report,  except as otherwise disclosed in this report. Any material instances of
noncompliance  described in such  reports have been  disclosed in this report on
Form 10-K.

      In  giving  the  certifications  above,  I have  reasonably  relied on the
information provided to me by the following unaffiliated parties: [the Trustee].

Date:_______________________

____________________________*
[Signature] [Title:]

*     to be signed by the senior officer in charge of the servicing functions of
      the Master Servicer

<PAGE>

                                    EXHIBIT P

            [FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE]

      The  undersigned,  a Responsible  Officer of [_________]  (the  "Trustee")
certifies that:

      (a) The Trustee has performed all of the duties  specifically  required to
be  performed  by it pursuant  to the  provisions  of the Pooling and  Servicing
Agreement  dated  as of  [_________],  20[__]  (the  "Agreement")  by and  among
[__________],  as  depositor,   Residential  Funding  Company,  LLC,  as  Master
Servicer, and the Trustee in accordance with the standards set forth therein.

      (b) Based on my knowledge,  the list of Certificateholders as shown on the
Certificate Register as of the end of each calendar year that is provided by the
Trustee  pursuant to the  Agreement is accurate as of the last day of the 20[__]
calendar year.

Capitalized terms used and not defined herein shall have the meanings given such
terms in the Agreement.

      IN WITNESS WHEREOF, I have duly executed this certificate as of _________,
20__.]

                                            Name:
                                            Title:

<PAGE>

                                    EXHIBIT Q

         INFORMATION TO BE PROVIDED BY THE MASTER SERVICER TO THE RATING
            AGENCIES RELATING TO REPORTABLE MODIFIED MORTGAGE LOANS

Account number

Transaction Identifier
Unpaid Principal Balance prior to Modification
Next Due Date
Monthly Principal and Interest
Payment Total Servicing Advances
Current Interest Rate
Original Maturity Date
Original Term to Maturity (Months)
Remaining Term to Maturity (Months)
Trial Modification Indicator
Mortgagor Equity Contribution
Total Servicer Advances
Trial Modification Term (Months)
Trial Modification Start Date
Trial Modification End Date
Trial Modification Period Principal and Interest Payment
Trial Modification Interest Rate
Trial Modification Term
Rate Reduction Indicator
Interest Rate Post Modification
Rate Reduction Start Date
Rate Reduction End Date
Rate Reduction Term

Term Modified Indicator
Modified Amortization Period
Modified Final Maturity Date
Total Advances Written Off
Unpaid Principal Balance Written Off
Other Past Due Amounts Written Off
Write Off Date
Unpaid Principal Balance Post Write Off
Capitalization Indicator
Mortgagor Contribution
Total Capitalized Amount
Modification Close Date
Unpaid Principal Balance  Post Capitalization Modification
Next Payment Due Date per Modification Plan
Principal and Interest Payment Post Modification

Interest Rate Post Modification
Payment Made Post Capitalization
Delinquency Status to Modification Plan

<PAGE>

                                    EXHIBIT R

         SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

      The assessment of compliance to be delivered by the Trustee shall address,
at a  minimum,  the  criteria  identified  as  below  as  "Applicable  Servicing
Criteria":

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------
                                                                                     Applicable Servicing
                                       Servicing Criteria                                  Criteria
---------------------------------------------------------------------------------------------------------
     Reference                             Criteria
---------------------------------------------------------------------------------------------------------
                              General Servicing Considerations
---------------------------------------------------------------------------------------------------------
<S>              <C>                                                                   <C>
1122(d)(1)(i)    Policies and procedures are instituted to monitor any performance
                 or other  triggers and events of default in  accordance  with the
                 transaction agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(1)(ii)   If any material  servicing  activities  are  outsourced  to third
                 parties,  policies and  procedures  are instituted to monitor the
                 third party's  performance  and  compliance  with such  servicing
                 activities.
---------------------------------------------------------------------------------------------------------
1122(d)(1)(iii)  Any  requirements  in the  transaction  agreements  to maintain a
                 back-up servicer for the pool assets are maintained.
---------------------------------------------------------------------------------------------------------
1122(d)(1)(iv)   A fidelity bond and errors and  omissions  policy is in effect on
                 the party  participating in the servicing function throughout the
                 reporting  period  in the  amount  of  coverage  required  by and
                 otherwise  in  accordance  with  the  terms  of  the  transaction
                 agreements.
---------------------------------------------------------------------------------------------------------
                          Cash Collection and Administration
---------------------------------------------------------------------------------------------------------
1122(d)(2)(i)    Payments on pool assets are deposited  into the  appropriate
                 custodial bank accounts and related bank clearing accounts no        |X| (as to accounts
                 more than two business  days  following  receipt,  or such  other      held by Trustee)
                 number  of  days   specified   in  the   transaction agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(2)(ii)   Disbursements  made via wire  transfer on behalf of an obligor or    |X| (as to investors
                 to   an investor are made only by  authorized personnel.                    only)
---------------------------------------------------------------------------------------------------------
1122(d)(2)(iii)  Advances  of  funds or  guarantees  regarding  collections,  cash
                 flows or  distributions,  and any  interest or other fees charged
                 for such advances,  are made,  reviewed and approved as specified
                 in the transaction agreements.
---------------------------------------------------------------------------------------------------------
                 The related accounts for the transaction, such as cash reserve
                 accounts or accounts established as a form of
                 overcollateralization, are separately maintained (e.g., with         |X| (as to accounts
                 respect to commingling of cash) as set forth in the transaction        held by Trustee)
1122(d)(2)(iv)   agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(2)(v)    Each  custodial  account is  maintained  at a  federally  insured
                 depository   institution   as  set   forth  in  the   transaction
                 agreements.  For purposes of this criterion,  "federally  insured
                 depository  institution"  with  respect  to a  foreign  financial
                 institution means a foreign financial  institution that meets the
                 requirements of Rule 13k-1(b)(1) of the Securities Exchange Act.
---------------------------------------------------------------------------------------------------------
1122(d)(2)(vi)   Unissued  checks are  safeguarded  so as to prevent  unauthorized
                 access.
---------------------------------------------------------------------------------------------------------
1122(d)(2)(vii)  Reconciliations   are  prepared  on  a  monthly   basis  for  all
                 asset-backed   securities   related  bank   accounts,   including
                 custodial  accounts and related  bank  clearing  accounts.  These
                 reconciliations  are (A)  mathematically  accurate;  (B) prepared
                 within 30 calendar days after the bank statement  cutoff date, or
                 such  other  number  of  days   specified   in  the   transaction
                 agreements;  (C) reviewed and approved by someone  other than the
                 person  who   prepared  the   reconciliation;   and  (D)  contain
                 explanations for reconciling  items.  These reconciling items are
                 resolved    within   90   calendar   days   of   their   original
                 identification,  or such other  number of days  specified  in the
                 transaction agreements.
---------------------------------------------------------------------------------------------------------
</TABLE>

                                      R-1
<PAGE>

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------
                                                                                     Applicable Servicing
                                       Servicing Criteria                                  Criteria
---------------------------------------------------------------------------------------------------------
     Reference                             Criteria
---------------------------------------------------------------------------------------------------------
                          Investor Remittances and Reporting
---------------------------------------------------------------------------------------------------------
<S>              <C>                                                                   <C>
1122(d)(3)(i)    Reports  to  investors,  including  those  to be  filed  with the
                 Commission,  are  maintained in accordance  with the  transaction
                 agreements and applicable Commission requirements.  Specifically,
                 such reports (A) are prepared in accordance  with  timeframes and
                 other terms set forth in the transaction agreements;  (B) provide
                 information  calculated in accordance with the terms specified in
                 the transaction agreements;  (C) are filed with the Commission as
                 required  by its  rules  and  regulations;  and  (D)  agree  with
                 investors'  or  the  trustee's  records  as to the  total  unpaid
                 principal  balance  and  number of pool  assets  serviced  by the
                 servicer.
---------------------------------------------------------------------------------------------------------
1122(d)(3)(ii)   Amounts due to investors are allocated and remitted in accordance            |X|
                 with timeframes, distribution priority and other terms set forth in
                 the transaction agreements.
---------------------------------------------------------------------------------------------------------
                 Disbursements made to an investor are posted within two business
                 days to the servicer's investor records, or such other number of             |X|
1122(d)(3)(iii)  days specified in the transaction agreements.
---------------------------------------------------------------------------------------------------------
                 Amounts remitted to investors per the investor reports agree with
                 cancelled checks, or other form of payment, or custodial bank                |X|
1122(d)(3)(iv)   statements.
---------------------------------------------------------------------------------------------------------
                                     Pool Asset Administration
---------------------------------------------------------------------------------------------------------
1122(d)(4)(i)    Collateral  or security on pool assets is  maintained as required
                 by the transaction agreements or related asset pool documents.
---------------------------------------------------------------------------------------------------------
                 Pool assets and related documents are safeguarded as required by
1122(d)(4)(ii)   the transaction agreements
---------------------------------------------------------------------------------------------------------
1122(d)(4)(iii)  Any additions,  removals or  substitutions  to the asset pool are
                 made,  reviewed and approved in accordance with any conditions or
                 requirements in the transaction agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(iv)   Payments  on  pool  assets,   including  any  payoffs,   made  in
                 accordance  with the related pool asset  documents  are posted to
                 the  servicer's  obligor  records  maintained  no more  than  two
                 business  days  after  receipt,  or  such  other  number  of days
                 specified  in  the  transaction  agreements,   and  allocated  to
                 principal,  interest or other items (e.g.,  escrow) in accordance
                 with the related pool asset documents.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(v)    The servicer's  records  regarding the pool assets agree with the
                 servicer's  records with respect to an obligor's unpaid principal
                 balance.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(vi)   Changes with respect to the terms or status of an obligor's  pool
                 asset (e.g., loan modifications or re-agings) are made,  reviewed
                 and  approved by  authorized  personnel  in  accordance  with the
                 transaction agreements and related pool asset documents.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(vii)  Loss  mitigation or recovery  actions (e.g.,  forbearance  plans,
                 modifications and deeds in lieu of foreclosure,  foreclosures and
                 repossessions,   as  applicable)  are  initiated,  conducted  and
                 concluded in accordance with the timeframes or other requirements
                 established by the transaction agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(viii) Records  documenting  collection  efforts are maintained during
                 the  period a pool asset is  delinquent  in  accordance  with the
                 transaction agreements. Such records are maintained on at least a
                 monthly basis, or such other period  specified in the transaction
                 agreements,  and describe the entity's  activities  in monitoring
                 delinquent  pool assets  including,  for  example,  phone  calls,
                 letters and payment rescheduling plans in cases where delinquency
                 is deemed temporary (e.g., illness or unemployment).
---------------------------------------------------------------------------------------------------------
1122(d)(4)(ix)   Adjustments  to interest rates or rates of return for pool assets
                 with variable  rates are computed based on the related pool asset
                 documents.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(x)    Regarding  any funds held in trust for an obligor (such as escrow
                 accounts):  (A) such funds are analyzed,  in accordance  with the
                 obligor's pool asset  documents,  on at least an annual basis, or
                 such other period  specified in the transaction  agreements;  (B)
                 interest  on such funds is paid,  or  credited,  to  obligors  in
                 accordance  with  applicable pool asset documents and state laws;
                 and (C) such funds are returned to the obligor within 30 calendar
                 days of full  repayment of the related pool asset,  or such other
                 number of days specified in the transaction agreements.
---------------------------------------------------------------------------------------------------------
</TABLE>

                                      R-2
<PAGE>

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------
                                                                                     Applicable Servicing
                                       Servicing Criteria                                  Criteria
---------------------------------------------------------------------------------------------------------
     Reference                             Criteria
---------------------------------------------------------------------------------------------------------
<S>              <C>                                                                   <C>
1122(d)(4)(xi)   Payments  made on behalf of an obligor  (such as tax or insurance
                 payments) are made on or before the related penalty or expiration
                 dates, as indicated on the appropriate  bills or notices for such
                 payments,  provided  that such  support has been  received by the
                 servicer at least 30 calendar days prior to these dates,  or such
                 other number of days specified in the transaction agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(xii)  Any late payment  penalties in connection  with any payment to be
                 made on behalf of an obligor are paid from the  servicer's  funds
                 and not charged to the  obligor,  unless the late payment was due
                 to the obligor's error or omission.
---------------------------------------------------------------------------------------------------------
                 Disbursements  made on behalf of an obligor are posted within two
                 business  days  to  the  obligor's  records   maintained  by  the
                 servicer,   or  such  other  number  of  days  specified  in  the
                 transaction
1122(d)(4)(xiii) agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(xiv)  Delinquencies,   charge-offs  and   uncollectible   accounts  are
                 recognized  and  recorded  in  accordance  with  the  transaction
                 agreements.
---------------------------------------------------------------------------------------------------------
1122(d)(4)(xv)   Any external  enhancement  or other  support,  identified in Item
                 1114(a)(1)  through  (3)  or  Item  1115  of  Regulation  AB,  is            |X|
                 maintained as set forth in the transaction agreements.
---------------------------------------------------------------------------------------------------------
</TABLE>

                                      R-3EXHIBIT 4.2

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

                            FORM OF SERIES SUPPLEMENT

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

                        RESIDENTIAL ACCREDIT LOANS, INC.,

                                    Company,

                        RESIDENTIAL FUNDING COMPANY, LLC,

                                Master Servicer,

                                       and

                              [__________________],

                                     Trustee

                               SERIES SUPPLEMENT,

                        Dated as of [________], 200[__],

                                       TO

                                STANDARD TERMS OF
                         POOLING AND SERVICING AGREEMENT
                         dated as of [_____] 1, 200[__]

                 Mortgage Asset-Backed Pass-Through Certificates

                              Series 200[__]-QS[_]

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

<PAGE>

ARTICLE I    DEFINITIONS ..................................................    3

   Section 1.01.  Definitions .............................................    3

   Section 1.02.  Use of Words and Phrases ................................   18

   Section 1.03.  [Determination of LIBOR .................................   18

ARTICLE II   CONVEYANCE OF MORTGAGE LOANS; ORIGINAL
             ISSUANCE OF CERTIFICATES .....................................   20

   Section 2.01.  Conveyance of Mortgage Loans ............................   20

   Section 2.02.  Acceptance by Trustee ...................................   20

   Section 2.03.  Representations, Warranties and Covenants of the
                  Master Servicer and the Company .........................   20

   Section 2.04.  Representations and Warranties of Sellers. (See Section
                  2.04 of the Standard Terms) .............................   23

   Section 2.05.  Execution and Authentication of Certificates/ Issuance
                  of Certificates Evidencing Interests in REMIC I
                  Certificates ............................................   23

   Section 2.06.  [Conveyance of Uncertificated REMIC I and REMIC II
                  Regular Interests; Acceptance by the Trustee ............   23

   Section 2.07.  [Issuance of Certificates Evidencing Interest
                  in REMIC II .............................................   24

   Section 2.08.  Purposes and Powers of the Trust (See Section 2.08 of
                  the Standard Terms) .....................................   24

ARTICLE III  ADMINISTRATION AND SERVICING OF MORTGAGE LOANS ...............   25

ARTICLE IV   PAYMENTS TO CERTIFICATEHOLDERS ...............................   26

   Section 4.01.  Certificate Account .....................................   26

   Section 4.02.  Distributions ...........................................   26

   Section 4.03.  Statements to Certificateholders ........................   36

   Section 4.04.  Distribution of Reports to the Trustee and the
                  Company; Advances by the Master Servicer ................   36

   Section 4.05.  Allocation of Realized Losses ...........................   36

   Section 4.06.  Reports of Foreclosures and Abandonment of
                  Mortgaged Property ......................................   38

   Section 4.07.  Optional Purchase of Defaulted Mortgage Loans ...........   38

   Section 4.08.  Surety Bond. (See Section 4.08 of the Standard
                  Terms) ..................................................   38

   Section 4.09.  [Reserve Fund ...........................................   38

   Section 4.10.  [Rounding Account .......................................   38

   Section 4.11.  [Principal Distributions on the Insured
                  Certificates ............................................   39

ARTICLE V    THE CERTIFICATES .............................................   43

ARTICLE VI   THE COMPANY AND THE MASTER SERVICER ..........................   44

<PAGE>

ARTICLE VII  DEFAULT ......................................................   45

ARTICLE VIII CONCERNING THE TRUSTEE .......................................   46

ARTICLE IX   TERMINATION ..................................................   47

ARTICLE X    REMIC PROVISIONS .............................................   48

   Section 10.01. REMIC Administration ....................................   48

   Section 10.02. Master Servicer; REMIC Administrator and
                  Trustee Indemnification .................................   48

   Section 10.03. Designation of REMIC[s] .................................   48

   Section 10.04. Distributions on the Uncertificated REMIC [I and
                  REMIC II] Regular Interests .............................   48

   Section 10.05. Compliance with Withholding Requirements ................   50

ARTICLE XI   MISCELLANEOUS PROVISIONS .....................................   51

   Section 11.01. Amendment ...............................................   51

   Section 11.02. Recordation of Agreement ................................   51

   Section 11.03. Limitation on Rights of Certificateholders ..............   51

   Section 11.04. Governing Laws ..........................................   51

   Section 11.05. Notices .................................................   51

   Section 11.06. Required Notices to Rating Agency and Subservicer .......   52

   Section 11.07. Severability of Provisions ..............................   52

   Section 11.08. Supplemental Provisions for Resecuritization ............   52

   Section 11.09. Allocation of Voting Rights .............................   52

   Section 11.10. No Petition .............................................   52

ARTICLE XII  [CERTAIN MATTERS REGARDING THE CERTIFICATE INSURER ...........   53

   Section 12.01. Rights of the Certificate Insurer To Exercise Rights
                  of Insured Certificateholders ...........................   53

   Section 12.02. Claims Upon the Certificate Policy; Certificate
                  Insurance Account .......................................   53

   Section 12.03. Effect of Payments by the Certificate Insurer;
                  Subrogation .............................................   54

   Section 12.04. Notices and Information to the Certificate
                  Insurer .................................................   55

   Section 12.05. Trustee to Hold Certificate Policy ......................   55

                                      O-2

<PAGE>

                                    EXHIBITS

Exhibit One:         Mortgage Loan Schedule
Exhibit Two:         Schedule of Discount Fractions
Exhibit Three:       Information to be Included in
                     Monthly Distribution Date Statement
Exhibit Four:        Standard Terms of Pooling and Servicing
                     Agreement Dated as of [_________]
[Exhibit [___]:      Schedule of Planned Principal Balances]
[Exhibit [___]:      Schedule of Targeted Principal Balances]

                                      O-3

<PAGE>

      This is a Series Supplement, dated as of [___________] 1, 200[__] (the
"Series Supplement"), to the Standard Terms of Pooling and Servicing Agreement,
dated as of [___] 1, 200[_] and attached as Exhibit Four hereto (the "Standard
Terms" and, together with this Series Supplement, the "Pooling and Servicing
Agreement" or "Agreement"), among RESIDENTIAL ACCREDIT LOANS, INC., as the
company (together with its permitted successors and assigns, the "Company"),
RESIDENTIAL FUNDING COMPANY, LLC, as master servicer (together with its
permitted successors and assigns, the "Master Servicer"), and
[__________________], as Trustee (together with its permitted successors and
assigns, the "Trustee").

                             PRELIMINARY STATEMENT:

      The Company intends to sell mortgage asset-backed pass-through
certificates (collectively, the "Certificates"), to be issued hereunder in
multiple classes, which in the aggregate will evidence the entire beneficial
ownership interest in the Mortgage Loans. As provided herein, the REMIC
Administrator will make an election to treat the entire segregated pool of
assets described in the definition of Trust Fund, and subject to this Agreement
(including the Mortgage Loans but excluding the Initial Monthly Payment Fund),
as one or more real estate mortgage investment conduits (each, a "REMIC") for
federal income tax purposes.

      The terms and provisions of the Standard Terms are hereby incorporated by
reference herein as though set forth in full herein. If any term or provision
contained herein shall conflict with or be inconsistent with any provision
contained in the Standard Terms, the terms and provisions of this Series
Supplement shall govern. All capitalized terms not otherwise defined herein
shall have the meanings set forth in the Standard Terms. The Pooling and
Servicing Agreement shall be dated as of the date of the Series Supplement.

<PAGE>

         The following table sets forth the designation, type, Pass-Through
Rate, aggregate Initial Certificate Principal Balance, Maturity Date, initial
ratings and certain features for each Class of Certificates comprising the
interests in the Trust Fund created hereunder.

<TABLE>
<CAPTION>

                                  Aggregate Initial                                            [Standard &
                  Pass-Through       Certificate                              Maturity           Poor's/            Minimum
Designation           Rate       Principal Balance       Features(1)            Date             Fitch]         Denominations(2)
-----------       ------------   ------------------    ---------------    -----------------    -----------      ----------------
<S>                  <C>           <C>                  <C>               <C>                   <C>              <C>
Class [_]            [___]%        $[__________]           Senior         [_____] 25, 20[_]      AAA/AAA         $[__________]
Class [_]            [___]%        $[__________]           Senior         [_____] 25, 20[_]      AAA/AAA         $[__________]
Class [_]            [___]%        $[__________]           Senior         [_____] 25, 20[_]      AAA/AAA         $[__________]
Class [_]            [___]%        $[__________]           Senior         [_____] 25, 20[_]      AAA/AAA         $[__________]
Class [_]            [___]%        $[__________]           Senior         [_____] 25, 20[_]      AAA/AAA         $[__________]
Class [_]            [___]%        $[__________]           Senior         [_____] 25, 20[_]      AAA/AAA         $[__________]
Class [_]            [___]%        $[__________]      [Senior Support]    [_____] 25, 20[_]      AAA/AAA         $[__________]
Class [_]            [___]%        $[__________]         Prepayment       [_____] 25, 20[_]      AAA/AAA         $[__________]
                                                       Lockout/Senior
Class A-P             0.00%        $[__________]          Principal       [_____] 25, 20[_]      AAA/AAA         $[__________]
                                                         Only/Senior
Class A-V           Variable               $0.00           Variable       [_____] 25, 20[_]      AAA/AAA               (4)
                    Rate(3)                             Strip/Senior
Class R              [___]%              $100.00       Residual/Senior    [_____] 25, 20[_]      AAA/AAA               (5)
Class M-1            [___]%        $[__________]          Mezzanine       [_____] 25, 20[_]       AA/AA          $[__________]
Class M-2            [___]%        $[__________]          Mezzanine       [_____] 25, 20[_]        A/A           $[__________]
Class M-3            [___]%        $[__________]          Mezzanine       [_____] 25, 20[_]      BBB/BBB         $[__________]
Class B-1            [___]%        $[__________]         Subordinate      [_____] 25, 20[_]       BB/BB          $[__________]
Class B-2            [___]%        $[__________]         Subordinate      [_____] 25, 20[_]        B/B           $[__________]
Class B-3            [___]%        $[__________]         Subordinate      [_____] 25, 20[_]        N/A           $[__________]
</TABLE>

      The Mortgage Loans have an aggregate principal balance as of the Cut-off
Date of $[__________].

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

      ----------
      (1)   The  Certificates,  other than the Class A-P, Class A-V, Class B and
            Class R  Certificates  shall be Book-Entry  Certificates.  The Class
            A-P, Class A-V, Class B and Class R Certificates  shall be delivered
            to the holders thereof in physical form.

      (2)   The Certificates, other than the [Retail,] Class [__], Class A-V and
            Class  R   Certificates,   shall  be  issuable  in  minimum   dollar
            denominations as indicated above (by Certificate  Principal  Balance
            or Notional Amount, as applicable) and integral  multiples of $1 (or
            $1,000 in the case of the Class A-P,  Class B-1, Class B-2 and Class
            B-3 Certificates) in excess thereof,  except that one Certificate of
            any of the  [Class  A-P and Class  B-1,  Class  B-2 and  Class  B-3]
            Certificates  that  contain an uneven  multiple  of $1,000  shall be
            issued in a  denomination  equal to the sum of the  related  minimum
            denomination set forth above and such uneven multiple for such Class
            or the sum of such  denomination and an integral multiple of $1,000.
            [The  Retail  Certificates  shall  be  issuable  in  minimum  dollar
            denominations  of $1,000 and integral  multiples of $1,000 in excess
            thereof].

      (3)   The  Initial  Pass-Through  Rate on the  Class A-V  Certificates  is
            [____]%.

      (4)   The  Class R  Certificates  and  Class  A-V  Certificates  shall  be
            issuable in minimum  denominations of not less than a 20% Percentage
            Interest;  provided,  however,  that one Class R Certificate will be
            issuable to Residential  Funding as "tax matters person" pursuant to
            Section  10.01(c) and (e) in a minimum  denomination  representing a
            Percentage Interest of not less than 0.01%.

                                       2
<PAGE>

                                   ARTICLE I

                                   DEFINITIONS

      Section 1.01. Definitions.

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

      [Accretion   Directed   Certificates:   Any   one  of  the   Class   [___]
Certificates.]

      [Accretion Termination Date: The earliest to occur of (i) the Distribution
Date after which the  Certificate  Principal  Balance of any Accretion  Directed
Certificates  has been reduced to zero; (ii) the  Distribution  Date after which
the Certificate  Principal Balance of the Accrual  Certificates has been reduced
to zero; and (iii) the Credit Support Depletion Date.]

      [Accrual Certificates: Any one of the Class [___] Certificates.]

      [Accrual Distribution Amount: With respect to each Distribution Date prior
to the  Accretion  Termination  Date,  an amount  equal to the amount of Accrued
Certificate  Interest on any Accrual  Certificates  for such date, to the extent
added  to  the  Certificate   Principal  Balance  thereof  pursuant  to  Section
[4.02(d)].]

      Bankruptcy  Amount:  As of any date of  determination  prior to the  first
anniversary  of the Cut-off Date, an amount equal to the excess,  if any, of (A)
$[______] over (B) the aggregate amount of Bankruptcy Losses allocated solely to
one or more specific  Classes of Certificates in accordance with Section 4.05 of
this Series  Supplement.  As of any date of  determination on or after the first
anniversary of the Cut-off Date, an amount equal to the excess, if any, of

            (1) the lesser of (a) the  Bankruptcy  Amount  calculated  as of the
      close of business  on the  Business  Day  immediately  preceding  the most
      recent  anniversary of the Cut-off Date  coinciding with or preceding such
      date of determination (or, if such date of determination is an anniversary
      of the Cut-off Date, the Business Day  immediately  preceding such date of
      determination)   (for   purposes  of  this   definition,   the   "Relevant
      Anniversary") and (b) the greater[est] of

                  (A) [if S&P is a rating  agency]  the  greater  of (i)  0.0006
            times the aggregate  principal  balance of all the Mortgage Loans in
            the  Mortgage  Pool  as of  the  Relevant  Anniversary  (other  than
            Additional  Collateral  Loans [or  Pledged  Asset  Mortgage  Loans])
            having a  Loan-to-Value  Ratio at origination  which exceeds 75% and
            (ii) $100,000; and

                  (B) [if  Fitch  is a rating  agency]  the  greater  of (i) the
            product  of (x) an amount  equal to the  largest  difference  in the
            related Monthly Payment for any Non-Primary Residence Loan remaining
            in the Mortgage  Pool (other than  Additional  Collateral  Loans [or
            Pledged Asset Mortgage  Loans]) which had an original  Loan-to-Value
            Ratio of 80% or greater that would  result if the Net Mortgage  Rate
            thereof was equal to the weighted  average  (based on the  principal

                                       3
<PAGE>

            balance of the Mortgage Loans as of the Relevant Anniversary) of the
            Net  Mortgage  Rates  of  all  Mortgage  Loans  as of  the  Relevant
            Anniversary less 1.25% per annum, (y) a number equal to the weighted
            average  remaining term to maturity,  in months,  of all Non-Primary
            Residence  Loans  remaining in the Mortgage  Pool as of the Relevant
            Anniversary,  and (z) one plus the  quotient  of the  number  of all
            Non-Primary  Residence  Loans remaining in the Mortgage Pool divided
            by the total number of  Outstanding  Mortgage  Loans in the Mortgage
            Pool as of the Relevant Anniversary, and (ii) $50,000, and

                  (C) [if  Moody's  is a  rating  agency]  (i) if the  aggregate
            principal  balance  of the  Non-Primary  Residence  Loans  as of the
            Relevant  Anniversary  is  less  than  10% of the  Stated  Principal
            Balance of the Mortgage Loans as of the Relevant Anniversary, $0.00,
            or  (ii)  if the  aggregate  principal  balance  of the  Non-Primary
            Residence  Loans  as of the  Relevant  Anniversary  is  equal  to or
            greater  than 10% of the Stated  Principal  Balance of the  Mortgage
            Loans as of the Relevant  Anniversary,  the sum of (I) the aggregate
            principal  balance  of  the  Non-Primary   Residence  Loans  with  a
            Loan-to-Value Ratio of greater than 80.00% but less than or equal to
            90.00% (other than Additional  Collateral Loans),  times 0.25%, (II)
            the aggregate  principal balance of the Non-Primary  Residence Loans
            with a  Loan-to-Value  Ratio of greater than 90.00% but less than or
            equal to 95.00%  (other than  Additional  Collateral  Loans),  times
            0.50%, and (III) the aggregate  principal balance of the Non-Primary
            Residence  Loans with a  Loan-to-Value  Ratio of greater than 95.00%
            (other than Additional  Collateral  Loans) times 0.75%, in each case
            as of the Relevant Anniversary,

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

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

      [CB Loan Group:  The group of  Mortgage  Loans  comprised  of the Group CB
Loans.]

      Certificate:  Any [Class A], [Class CB], [Class NB], Class A-P, Class A-V,
Class M, Class B or Class R Certificate.

      Certificate   Account:  The  separate  account  or  accounts  created  and
maintained  pursuant  to Section  4.01 of the  Standard  Terms,  which  shall be
entitled "[__________________],  as trustee, in trust for the registered holders
of  Residential  Accredit  Loans,  Inc.,  Mortgage   Asset-Backed   Pass-Through
Certificates, Series 200[_]-QS[_]" and which must be an Eligible Account.

                                       4
<PAGE>

      [Certificate  Insurance  Account:  The  account  established  pursuant  to
Section [_______] hereof.]

      [Certificate  Insurance  Payment:  Any  payment  made  by the  Certificate
Insurer with respect to any Insured Certificates under the Certificate Policy.]

      [Certificate Insurance Premium: With respect to the Certificate Policy and
any  Distribution  Date, an amount equal to one-twelfth  (1/12) of [___]% of the
Certificate Principal Balance of the Insured Certificates.]

      [Certificate Insurer: [_____________], a stock insurance company organized
and created under the laws of the State of  [_____________],  and any successors
thereto, issuer of the Certificate Policy (No. [_________]).]

      [Certificate  Insurer Default:  The existence and continuance of a failure
by the  Certificate  Insurer to make a payment  required  under the  Certificate
Policy in accordance with its terms.]

      [Certificate Policy: The financial guaranty insurance policy issued by the
Certificate Insurer for the benefit of the Holders of any Insured  Certificates,
including any endorsements thereto, attached hereto as Exhibit [___].]

      Class A Certificate:  Any one of the [Class  A-[__],  Class A-[__],] Class
A-P or Class A-V Certificates,  executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as
Exhibit A.

      [Class CB  Certificate:  Any one of the Class  CB-[___]  Certificates  [or
Class CB-__  Certificates],  executed by the  Trustee and  authenticated  by the
Certificate Registrar substantially in the form annexed to the Standard Terms as
Exhibit A, which Certificates relate to the Group CB Loans.]

      [Class CB Percentage:  As of any Distribution Date, the lesser of 100% and
a fraction,  expressed as a percentage,  the numerator of which is the aggregate
Certificate  Principal  Balance  of the  Class  CB  Certificates  [and  Class  R
Certificates] immediately prior to such Distribution Date and the denominator of
which is the aggregate Stated Principal Balance of all of the Mortgage Loans (or
related  REO  Properties)  (other  than the  related  Discount  Fraction of each
Discount  Mortgage  Loan)  in  the CB  Loan  Group  immediately  prior  to  such
Distribution Date.]

      [Class CB Principal  Distribution Amount: As to any Distribution Date, the
lesser of (a) the balance of the Available Distribution Amount related to the CB
Loan Group  remaining  after the  distribution  of all  amounts  required  to be
distributed  pursuant to Section  4.02(a)(i)(X),  after the  distribution of the
portion of the amounts required to be distributed  therefrom pursuant to Section
4.02(a)(i)([Z]),  and  after  the  distribution  of the  amount  required  to be
distributed   to  the  Class  A-P   Certificateholders   pursuant   to   Section
4.02(a)(ii)(X)  or, after the Credit Support Depletion Date, the amount required
to be  distributed  to the  Class A-P  Certificateholders  pursuant  to  Section
4.02(d), and (b) the sum of the amounts required to be distributed  therefrom to
the  Class  CB  Certificateholders  [and  Class  R  Certificateholders]  on such
Distribution  Date  pursuant  to and  Section  4.02(a)(ii)([Y])  and ([Z]),  and
Section 4.02(a)(xvii) [and (xviii)].]

                                       5
<PAGE>

      [Class NB  Certificate:  Any one of the Class  NB-[___]  Certificates  [or
Class NB-[___]  Certificates],  executed by the Trustee and authenticated by the
Certificate Registrar substantially in the form annexed to the Standard Terms as
Exhibit A, which Certificates relate to the Group NB Loans.]

      [Class NB Percentage:  As of any Distribution Date, the lesser of 100% and
a fraction,  expressed as a percentage,  the numerator of which is the aggregate
Certificate  Principal  Balance  of the  Class  NB  Certificates  [and  Class  R
Certificates] immediately prior to such Distribution Date and the denominator of
which is the aggregate Stated Principal Balance of all of the Mortgage Loans (or
related  REO  Properties)  (other  than the  related  Discount  Fraction of each
Discount  Mortgage  Loan)  in  the NB  Loan  Group  immediately  prior  to  such
Distribution Date.]

      [Class NB Principal  Distribution Amount: As to any Distribution Date, the
lesser of (a) the balance of the Available Distribution Amount related to the NB
Loan Group  remaining  after the  distribution  of all  amounts  required  to be
distributed pursuant to Section  4.02(a)(i)([Y]),  after the distribution of the
portion of the amounts required to be distributed  therefrom pursuant to Section
4.02(a)(i)([Z]),  and  after  the  distribution  of the  amount  required  to be
distributed   to  the  Class  A-P   Certificateholders   pursuant   to   Section
4.02(a)(ii)(X)  or, after the Credit Support Depletion Date, the amount required
to be  distributed  to the  Class A-P  Certificateholders  pursuant  to  Section
4.02(d), and (b) the sum of the amounts required to be distributed  therefrom to
the  Class  NB  Certificateholders  [and  Class  R  Certificateholders]  on such
Distribution  Date  pursuant  to and  Section  4.02(a)(ii)([Y])  and ([Z]),  and
Section 4.02(a)(xvii) [and (xviii)].]

      Class R Certificate: [Any one of the Class R-I Certificates and Class R-II
Certificates.] [Any one of the Class R Certificates  executed by the Trustee and
authenticated by the Certificate Registrar  substantially in the form annexed to
the  Standard  Terms as Exhibit D and  evidencing  an interest  designated  as a
"residual interest" in the REMIC for purposes of the REMIC Provisions.]

      [Class R-I Certificate:  Any one of the Class R-I Certificates executed by
the Trustee and authenticated by the Certificate Registrar  substantially in the
form  annexed to the  Standard  Terms as Exhibit D and  evidencing  an  interest
designated  as a  "residual  interest"  in  REMIC I for  purposes  of the  REMIC
Provisions.]

      [Class R-II Certificate:  Any one of the Class R-II Certificates  executed
by the Trustee and authenticated by the Certificate  Registrar  substantially in
the form annexed to the Standard  Terms as Exhibit D and  evidencing an interest
designated  as a  "residual  interest"  in REMIC II for  purposes  of the  REMIC
Provisions.]

      Closing Date: [_____________], 200[__].

      Corporate  Trust Office:  The principal  office of the Trustee at which at
any particular  time its corporate trust business with respect to this Agreement
shall  be  administered,  which  office  at the  date of the  execution  of this
instrument is located at [Address of Trustee],  Attention:  Residential  Funding
Company, LLC Series 200[__]-QS[_].

      [Cumulative  Insurance  Payments:  As of any  time of  determination,  the
aggregate  of  all  Certificate   Insurance  Payments  previously  made  by  the
Certificate Insurer under the Certificate

                                       6
<PAGE>

Policy minus the aggregate of all payments  previously  made to the  Certificate
Insurer pursuant to [Sections  4.02(a)(xvi) and 4.02(e)] hereof as reimbursement
for Certificate Insurance Payments.]

      Custodial  File:  Any mortgage  loan document in the Mortgage File that is
required to be delivered to the Trustee or Custodian pursuant to Section 2.01(b)
of this Agreement.

      Cut-off Date: [___________] 1, 200[__].

      Determination   Date:   With  respect  to  any   Distribution   Date,  the
[second/third] Business Day prior to each Distribution Date.

      Discount Net Mortgage Rate: [____]% per annum.

      Due Period:  With respect to each Distribution Date and any Mortgage Loan,
the period  commencing  on the [__] day of the month prior to the month in which
such  Distribution  Date occurs and ending on the [__] day of the month in which
such Distribution Date occurs.

      Eligible  Funds:  On any  Distribution  Date, the portion,  if any, of the
Available  Distribution  Amount  remaining after reduction by the sum of (i) the
aggregate  amount of Accrued  Certificate  Interest on the Senior  Certificates,
(ii) the Senior  Principal  Distribution  Amount  (determined  without regard to
Section [4.02(a)(ii)(Y)(D)]  hereof), (iii) the Class A-P Principal Distribution
Amount (determined without regard to Section  4.02(b)(i)(E) hereof) and (iv) the
aggregate amount of Accrued  Certificate  Interest on the Class M, Class B-1 and
Class B-2 Certificates.

      [Floater Certificates: Class [___] Certificates].

      Fraud Loss Amount: As of any date of determination after the Cut-off Date,
an amount equal to: (X) prior to the [first]  anniversary of the Cut-off Date an
amount equal to [2.00]% of the aggregate outstanding principal balance of all of
the Mortgage  Loans as of the Cut-off Date minus the  aggregate  amount of Fraud
Losses  allocated  solely to one or more  specific  Classes of  Certificates  in
accordance with Section 4.05 of this Series Supplement since the Cut-off Date up
to such date of determination  and (Y) from the [first] to the fifth anniversary
of the  Cut-off  Date,  an amount  equal to (1) the lesser of (a) the Fraud Loss
Amount as of the most recent  anniversary of the Cut-off Date and (b) [1.00]% of
the aggregate  outstanding  principal balance of all of the Mortgage Loans as of
the most recent  anniversary of the Cut-off Date minus (2) the aggregate  amount
of Fraud Losses allocated solely to one or more specific Classes of Certificates
in accordance with Section 4.05 since the most recent anniversary of the Cut-off
Date up to such date of determination. On and after the fifth anniversary of the
Cut-off Date, the Fraud Loss Amount shall be zero.

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

                                       7
<PAGE>

      [Group CB Loans:  The  Mortgage  Loans  designated  on the  Mortgage  Loan
Schedule as Group CB Loans,  having  original  principal  balances  less than or
equal to $[___________].]

      [Group NB Loans:  The  Mortgage  Loans  designated  on the  Mortgage  Loan
Schedule  as  Group NB  Loans,  having  original  principal  balances  exceeding
$[_____________].]

      [Guaranteed Distribution: With respect to any Insured Certificates and any
Distribution Date, as defined in the Certificate Policy.]

      [Index: [____________].]

      [Indirect Depository Participant:  An institution that is not a Depository
Participant  but clears  through or  maintains  a  custodial  relationship  with
Participants and has access to the Depository's clearing system.]

      Initial  Monthly  Payment  Fund:   $[________],   representing   scheduled
principal  amortization  and  interest at the Net  Mortgage  Rate during the Due
Period ending on _________  200_, for those Mortgage Loans for which the Trustee
will not be entitled to receive such payment.

      Initial  Notional  Amount:  With respect to the Class A-V  Certificates or
Subclass thereof issued pursuant to Section 5.01(c),  the aggregate Cut-off Date
Principal  Balance of the Mortgage  Loans  corresponding  to the  Uncertificated
REMIC I Regular  Interests Z represented  by such Class or Subclass on such date
[; and, with respect to any Class [___] Certificate, $[_____________]].

      Initial  Subordinate  Class  Percentage:  With  respect  to each  Class of
Subordinate  Certificates,  an amount  which is equal to the  initial  aggregate
Certificate  Principal  Balance  of the such Class of  Subordinate  Certificates
divided by the aggregate Stated  Principal  Balance of all the Mortgage Loans as
of the Cut-off Date as follows:

         Class M-1: [___]%     Class B-1: [___]%
         Class M-2: [___]%     Class B-2: [___]%
         Class M-3: [___]%     Class B-3: [___]%

      [Insured Certificates: Any one of the Class [___] Certificates.]

      [Insured Retail Certificate:  An Insured Certificate that evidences $1,000
initial Certificate Principal Balance.]

      Interest  Accrual  Period:  With  respect  to  any  Certificates  and  any
Distribution  Date[,  the  calendar  month  preceding  the  month in which  such
Distribution Date occurs].

      Interest  Only  Certificates:  Any one of the Class A-V  Certificates  [or
Class  [___]   Certificates.]  The  Interest  Only  Certificates  will  have  no
Certificate Principal Balance.

      [Inverse Floater Certificates: Class [___] Certificates].

                                       8
<PAGE>

      [LIBOR Rate Adjustment Date: [___________].]

      [Loan Group: Either or both of the CB Loan Group or the NB Loan Group.]

      [Lockout  Percentage:  For any  Distribution  Date occurring  prior to the
Distribution Date in [_______]  200[_],  0%; for any Distribution Date occurring
after [______] 200[_] but prior to [_______]  200[_],  30%; for any Distribution
Date occurring after [______] 200[_] but prior to [_______] 200[_], 40%; for any
Distribution Date occurring after [______] 200[_] but prior to [_______] 200[_],
60%; for any  Distribution  Date occurring  after  [______]  200[_] but prior to
[_______] 200[_], 80%; for any Distribution Date after [_______] 200_, 100%.]

      [Lockout Scheduled  Percentage:  for any Distribution Date occurring prior
to  the  Distribution  Date  in  [_________]  200[_]  will  be 0%  and  for  any
Distribution Date thereafter, will be 100%.]

      Maturity Date:  [________] 25, 20[__],  the Distribution  Date immediately
following the latest scheduled maturity date of any Mortgage Loan].

      Mortgage Loan  Schedule:  The list or lists of the Mortgage Loans attached
hereto as Exhibit One (as amended  from time to time to reflect the  addition of
Qualified  Substitute  Mortgage Loans),  which list or lists shall set forth the
following information as to each Mortgage Loan:

      (i)   the Mortgage Loan identifying number ("RFC LOAN #");

      (ii)  the maturity of the Mortgage Note ("MATURITY DATE");

      (iii) the Mortgage Rate ("ORIG RATE");

      (iv)  the Subservicer pass-through rate ("CURR NET");

      (v)   the Net Mortgage Rate ("NET MTG RT");

      (vi)  the Pool Strip Rate ("STRIP");

      (vii) the initial  scheduled  monthly  payment of  principal,  if any, and
            interest ("ORIGINAL P & I");

      (viii) the Cut-off Date Principal Balance ("PRINCIPAL BAL");

      (ix)  the Loan-to-Value Ratio at origination ("LTV");

      (x)   the rate at which the Subservicing  Fee accrues  ("SUBSERV FEE") and
            at which the Servicing Fee accrues ("MSTR SERV FEE");

      (xi)  a code "T," "BT" or "CT" under the column "LN  FEATURE,"  indicating
            that the Mortgage Loan is secured by a second or vacation residence;
            and

                                       9
<PAGE>

      (xii) a code  "N"  under  the  column  "OCCP  CODE,"  indicating  that the
            Mortgage Loan is secured by a non-owner occupied residence.

      Such schedule may consist of multiple reports that  collectively set forth
all of the information required.

      [NB Loan Group:  The group of  Mortgage  Loans  comprised  of the Group NB
Loans.]

      Notional Amount:  As of any  Distribution  Date, with respect to any Class
A-V  Certificates or Subclass  thereof issued pursuant to Section  5.01(c),  the
aggregate  Stated Principal  Balance of the Mortgage Loans  corresponding to the
Uncertificated REMIC I Regular Interests Z represented by such Class or Subclass
immediately  prior to such date [and, as of any Distribution  Date, with respect
to any Class [___]  Certificate,  an amount equal to the  Certificate  Principal
Balance of the Class [___] Certificates immediately prior to such date].

      [PAC Certificates: Any Class [___] Certificate.]

      [PAC Distribution Amount: As of any Distribution Date, the amount required
to reduce the Certificate  Principal  Balances of the PAC  Certificates to their
Planned Principal Balances as of such Distribution Date.]

      Pass-Through  Rate:  With  respect  to the [Class A] [Class CB] [Class NB]
Certificates [(other than the [Floater],  [Inverse Floater], Class A-V and Class
A-P  Certificates)],  Class M  Certificates,  Class B  Certificates  and Class R
Certificates  and any  Distribution  Date,  the per annum rates set forth in the
Preliminary  Statement hereto. [With respect to the Floater Certificates and the
initial  Interest  Accrual  Period,  [____]% per annum,  and as to any  Interest
Accrual  Period  thereafter,  a per annum  rate equal to  [Index]  plus  [___]%,
subject to a maximum  rate of [___]% per annum and a minimum  rate of [___]% per
annum.]  [With  respect to the  Inverse  Floater  Certificates  and the  initial
Interest  Accrual Period,  [_______]% per annum,  and as to any Interest Accrual
Period  thereafter,  a per annum rate equal to  [______]%  minus the  product of
[_____] and  [Index],  subject to a maximum  rate of  [______]%  per annum and a
minimum rate of [0.000]% per annum.] With respect to the Class A-V  Certificates
(other than any Subclass thereof) and any Distribution Date, a rate equal to the
weighted  average,  expressed  as a  percentage,  of the Pool Strip Rates of all
Mortgage  Loans as of the Due Date in the related  Due  Period,  weighted on the
basis of the respective  Stated Principal  Balances of such Mortgage Loans as of
the day immediately  preceding such  Distribution  Date (or, with respect to the
initial  Distribution  Date, at the close of business on the Cut-off Date). With
respect to the Class A-V  Certificates  and the  initial  Distribution  Date the
Pass-Through Rate is equal to [____]% per annum. With respect to any Subclass of
Class A-V Certificates  and any Distribution  Date, a rate equal to the weighted
average,  expressed  as a  percentage,  of the Pool Strip Rates of all  Mortgage
Loans   corresponding  to  the  Uncertificated   REMIC  I  Regular  Interests  Z
represented  by such  Subclass  as of the Due Date in the  related  Due  Period,
weighted  on the  basis of the  respective  Stated  Principal  Balances  of such
Mortgage Loans as of the day immediately  preceding such  Distribution  Date (or
with respect to the initial  Distribution  Date, at the close of business on the
Cut-off Date). The Principal Only Certificates have no Pass-Through Rate and are
not entitled to Accrued Certificate Interest.

                                       10
<PAGE>

      [Planned Principal Balance:  With respect to the PAC Certificates and each
Distribution   Date,  the  amount  set  forth  for  such  Certificates  on  such
Distribution Date on Exhibit [__] hereto.]

      Prepayment  Assumption:  [With respect to the Class [CB,  Class A-P, Class
A-V, Class M and Class B] Certificates, the prepayment assumption to be used for
determining  the  accrual of  original  issue  discount  and  premium and market
discount on such  Certificates for federal income tax purposes,  which assumes a
constant  prepayment  rate of 4.0% per annum of the then  outstanding  principal
balance of the  related  Mortgage  Loans in the first  month of the life of such
Mortgage  Loans and an  additional  1.0909%  per annum in each month  thereafter
until the twelfth  month,  and  beginning in the twelfth month and in each month
thereafter during the life of the Mortgage Loans, a constant  prepayment rate of
16.0% per annum.] [With respect to the Class [NB]  Certificates,  the prepayment
assumption to be used for determining the accrual of original issue discount and
market  discount  and  premium  on such  Certificates  for  federal  income  tax
purposes,  which assumes a constant rate of prepayment of mortgage loans of 6.0%
per annum of the then  outstanding  principal  balance of such mortgage loans in
the first month of the life of the mortgage  loans,  increasing by an additional
1.272727%  per annum in each  succeeding  month until the twelfth  month,  and a
constant  20.0%  per annum  rate of  prepayment  thereafter  for the life of the
mortgage loans.]

      Prepayment Distribution Percentage:  With respect to any Distribution Date
[and the  Available  Distribution  Amount for each Loan Group] and each Class of
Subordinate  Certificates,  under the applicable  circumstances set forth below,
the respective percentages set forth below:

      (i)   For any Distribution Date prior to the Distribution Date in [______]
            200[__]  [(unless the Certificate  Principal  Balances of the Senior
            Certificates  (other than the Class A-P  Certificates)]  [unless the
            Certificate  Principal  Balances of the Class CB  Certificates  [and
            Class  R  Certificates]  or  Class  NB  Certificates  [and  Class  R
            Certificates], as applicable,] have been reduced to zero), 0%.

      (ii)  For any Distribution Date not discussed in clause (i) above on which
            any Class of Subordinate Certificates are outstanding:

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

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

                                       11
<PAGE>

      (iii) Notwithstanding  the foregoing,  if the application of the foregoing
            percentages on any Distribution  Date as provided in Section 4.02 of
            this Series Supplement  (determined without regard to the proviso to
            the definition of "Subordinate Principal Distribution Amount") would
            result in a  distribution  in respect of  principal  of any Class or
            Classes of  Subordinate  Certificates  in an amount greater than the
            remaining  Certificate  Principal Balance thereof (any such class, a
            "Maturing Class"), then: (a) the Prepayment  Distribution Percentage
            of each  Maturing  Class  shall be  reduced  to a level  that,  when
            applied as described  above,  would exactly  reduce the  Certificate
            Principal  Balance  of  such  Class  to  zero;  (b)  the  Prepayment
            Distribution   Percentage   of  each  other  Class  of   Subordinate
            Certificates  (any such  Class,  a  "Non-Maturing  Class")  shall be
            recalculated  in accordance  with the  provisions in paragraph  (ii)
            above,  as if the  Certificate  Principal  Balance of each  Maturing
            Class had been reduced to zero (such percentage as recalculated, the
            "Recalculated  Percentage");  (c) the total amount of the reductions
            in the Prepayment Distribution  Percentages of the Maturing Class or
            Classes  pursuant to clause (a) of this  sentence,  expressed  as an
            aggregate  percentage,  shall be  allocated  among the  Non-Maturing
            Classes in proportion to their respective  Recalculated  Percentages
            (the  portion  of  such  aggregate  reduction  so  allocated  to any
            Non-Maturing  Class,  the  "Adjustment  Percentage");  and  (d)  for
            purposes of such  Distribution  Date,  the  Prepayment  Distribution
            Percentage of each  Non-Maturing  Class shall be equal to the sum of
            (1) the Prepayment  Distribution  Percentage thereof,  calculated in
            accordance  with the  provisions  in paragraph  (ii) above as if the
            Certificate  Principal  Balance of each Maturing  Class had not been
            reduced to zero, plus (2) the related Adjustment Percentage.

      [Prepayment Lockout Percentage:  For any Distribution Date occurring prior
to the Distribution Date in [__________]  200[_],  0%; for any Distribution Date
occurring after [__________]  200[_] but prior to [__________]  200[_], 30%; for
any  Distribution  Date  occurring  after  [__________]   200[_]  but  prior  to
[__________] 200[_], 40%; for any Distribution Date occurring after [__________]
200[_]  but  prior  to  [__________]  200[_],  60%;  for any  Distribution  Date
occurring after [__________]  200[_] but prior to [__________]  200[_], 80%; for
any Distribution Date after [__________] 200[_], 100%.]

      [Principal  Only  Certificates:  Any one of the Class A-P  Certificates or
Class __ Certificates.]

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

      Related Classes: As to any Uncertificated REMIC I Regular Interest,  those
classes of Certificates  identified as "Related Classes of Certificates" to such
Uncertificated  REMIC I Regular  Interest in the  definition  of  Uncertificated
REMIC I Regular Interest.

      [REMIC I: The  segregated  pool of assets,  with  respect to which a REMIC
election is to be made, consisting of:

                                       12
<PAGE>

      (i)   the Mortgage Loans and the related Mortgage Files,

      (ii)  all payments and  collections  in respect of the Mortgage  Loans due
            after  the  Cut-off  Date as shall be on  deposit  in the  Custodial
            Account or in the Certificate Account and identified as belonging to
            the Trust Fund,  including  the  proceeds  from the  liquidation  of
            Additional  Collateral for any Additional  Collateral  Loan, but not
            including amounts on deposit in the Initial Monthly Payment Fund,

      (iii) property  which  secured a Mortgage Loan and which has been acquired
            for the benefit of the  Certificateholders by foreclosure or deed in
            lieu of foreclosure,

      (iv)  the hazard insurance  policies and Primary  Insurance  Policies,  if
            any, the Pledged  Assets with respect to each Pledged Asset Mortgage
            Loan, and the interest in the Surety Bond transferred to the Trustee
            pursuant to Section 2.01 herein, and

      (v)   all proceeds of clauses (i) through (iv) above.]

      [REMIC I Certificates: The Class R-I Certificates.]

      [REMIC II: The segregated pool of assets consisting of the  Uncertificated
REMIC I Regular  Interests  conveyed  in trust to the Trustee for the benefit of
the  holders  of  each  Class  of   Certificates   (other  than  the  Class  R-I
Certificates)  pursuant to Section 2.06,  with respect to which a separate REMIC
election is to be made.]

      [REMIC II  Certificates:  Any Class of Certificates  (other than the Class
R-I Certificates).]

      [Reserve Fund Deposit: [_____].]

      [Reserve Fund: Any one or more segregated trust accounts that are Eligible
Accounts, which shall be titled "Reserve Fund, [NAME OF TRUSTEE], as trustee for
the  registered   holders  of  Residential   Accredit  Loans,   Inc.,   Mortgage
Asset-Backed Pass-Through Certificates, Series 200[__]-QS[_], Class [___]."]

      [Reserve Fund Withdrawal: As defined in Section 4.[__].]

      [Retail Certificates: Any of the Class [__] Certificates.]

      [Rounding Account: A segregated trust account that is an Eligible Account,
which shall be titled "Rounding Account,  [NAME OF TRUSTEE],  as trustee for the
registered holders of Residential  Accredit Loans, Inc.,  Mortgage  Asset-Backed
Pass-Through Certificates, Series 200[__]-QS[_], Class [__]."]

      [Rounding Amount: [______].]

                                       13
<PAGE>

      Senior Certificate:  Any one of the [Class A], [Class CB, Class NB], Class
A-P,  Class  A-V  or  Class  R   Certificates,   executed  by  the  Trustee  and
authenticated by the Certificate Registrar  substantially in the form annexed to
the Standard Terms as Exhibit A and Exhibit D.

      Senior  Percentage:  As of any Distribution Date, the lesser of 100% and a
fraction,  expressed as a  percentage,  the  numerator of which is the aggregate
Certificate  Principal Balance of the Senior  Certificates (other than the Class
A-P   Certificates)   immediately  prior  to  such  Distribution  Date  and  the
denominator  of which is the aggregate  Stated  Principal  Balance of all of the
Mortgage  Loans (or related  REO  Properties)  (other than the related  Discount
Fraction of each Discount  Mortgage Loan) immediately prior to such Distribution
Date.] [The Class CB Percentage or Class NB Percentage, as applicable.]

      Senior Principal  Distribution  Amount:  [As to any Distribution Date, the
lesser of (a) the balance of the Available  Distribution  Amount remaining after
the distribution of all amounts  required to be distributed  pursuant to Section
4.02(a)(i) and Section  4.02(a)(ii)(X) of this Series Supplement,  or, after the
Credit  Support  Depletion  Date,  the amount  required to be distributed to the
Class  A-P  Certificateholders  pursuant  to  Section  4.02(c)  of  this  Series
Supplement,  and (b) the sum of the amounts  required to be  distributed  to the
Senior   Certificateholders  on  such  Distribution  Date  pursuant  to  Section
4.02(a)(ii)(Y),  (xvi) and  (xvii) of this  Series  Supplement.]  [The  Class CB
Principal  Distribution Amount or the Class NB Principal Distribution Amount, as
applicable.]

      [Senior Support Certificates: Any one of the Class [__] Certificates.]

      Special Hazard  Amount:  As of any  Distribution  Date, an amount equal to
$[_________]  minus the sum of (i) the aggregate amount of Special Hazard Losses
allocated  solely to one or more specific  Classes of Certificates in accordance
with Section 4.05 of this Series  Supplement and (ii) the Adjustment  Amount (as
defined below) as most recently calculated.  For each anniversary of the Cut-off
Date, the Adjustment  Amount shall be equal to the amount,  if any, by which the
amount  calculated in accordance  with the preceding  sentence  (without  giving
effect to the deduction of the Adjustment Amount for such  anniversary)  exceeds
the greater of (A) the greatest of (i) twice the outstanding  principal  balance
of the  Mortgage  Loan in the  Trust  Fund  which  has the  largest  outstanding
principal   balance  on  the  Distribution   Date  immediately   preceding  such
anniversary, (ii) the product of [1.00]% multiplied by the outstanding principal
balance of all Mortgage Loans on the  Distribution  Date  immediately  preceding
such anniversary and (iii) the aggregate  outstanding  principal  balance (as of
the immediately preceding Distribution Date) of the Mortgage Loans in any single
five-digit California zip code area with the largest amount of Mortgage Loans by
aggregate principal balance as of such anniversary and (B) [if Fitch is a rating
agency] the greater of (i) the product of [0.50]%  multiplied by the outstanding
principal  balance of all Mortgage Loans on the  Distribution  Date  immediately
preceding such anniversary  multiplied by a fraction,  the numerator of which is
equal to the  aggregate  outstanding  principal  balance (as of the  immediately
preceding  Distribution  Date) of all of the Mortgage Loans secured by Mortgaged
Properties  located  in  the  State  of  California  divided  by  the  aggregate
outstanding  principal  balance (as of the  immediately  preceding  Distribution
Date)  of all  of  the  Mortgage  Loans,  expressed  as a  percentage,  and  the
denominator  of  which  is equal to  [___]%  (which  percentage  is equal to the
percentage of Mortgage Loans by aggregate principal balance initially secured by
Mortgaged Properties located in the State of

                                       14
<PAGE>

California)  and (ii) the  aggregate  outstanding  principal  balance (as of the
immediately preceding Distribution Date) of the largest Mortgage Loan secured by
a Mortgaged  Property  (or,  with  respect to a  Cooperative  Loan,  the related
Cooperative Apartment) located in the State of California.

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

      Subordinate   Principal   Distribution   Amount:   With   respect  to  any
Distribution  Date [and Loan Group] and each Class of Subordinate  Certificates,
(a) the sum of the  following:  (i) such  Class's pro rata  share,  based on the
Certificate  Principal  Balance of each Class of Subordinate  Certificates  then
outstanding,  of the aggregate of the amounts calculated  (without giving effect
to the  [related  Senior]  Percentage[s])  for such  Distribution  Date [for the
related   Loan   Group]   under   clauses   (1),   (2)   and   (3)  of   Section
[4.02(a)(ii)(Y)(A)]  to the extent not payable to the Senior Certificates;  (ii)
such Class's pro rata share, based on the Certificate  Principal Balance of each
Class of Subordinate Certificates then outstanding, of the principal collections
described  in  Section  [4.02(a)(ii)(Y)(B)(b)]  [for  the  related  Loan  Group]
(without  giving  effect  to  the  [related]  Senior  Accelerated   Distribution
Percentages) to the extent such collections are not otherwise distributed to the
Senior  Certificates;   (iii)  the  product  of  (x)  the  [related]  Prepayment
Distribution  Percentage  and (y) the aggregate of all Principal  Prepayments in
Full received in the related Prepayment Period and Curtailments  received in the
preceding  calendar month [for the related Loan Group] (other than the [related]
Discount  Fraction of such Principal  Prepayments in Full and Curtailments  with
respect to a  Discount  Mortgage  Loan) to the extent not  payable to the Senior
Certificates;  (iv) if such Class is the Class of Subordinate  Certificates with
the Highest Priority,  any Excess Subordinate  Principal Amount [for the related
Loan Group] for such Distribution Date; and (v) any amounts described in clauses
(i),  (ii) and (iii) as  determined  for any previous  Distribution  Date,  that
remain  undistributed  to the extent that such amounts are not  attributable  to
Realized Losses which have been allocated to a Class of Subordinate Certificates
minus (b) with respect to the Class of Subordinate  Certificates with the Lowest
Priority,  any Excess  Subordinate  Principal Amount for such Distribution Date;
provided,  however, that the Subordinate  Principal  Distribution Amount for any
Class of Subordinate  Certificates  on any  Distribution  Date shall in no event
exceed  the  outstanding   Certificate   Principal  Balance  of  such  Class  of
Certificates immediately prior to such date.

      [Super Senior Certificates: Any one of the Class [__] Certificates.]

      [Super Senior Principal  Distribution  Amount: As of any Distribution Date
on  or  after  the  Credit  Support  Depletion  Date  the  product  of  (a)  the
then-applicable Super Senior Percentage and (b) the sum of the amounts set forth
in Section [4.02(a)(ii)(Y)(A), (B), (C), (D) and (E)].

      [Super  Senior  Percentage:  As of  any  Distribution  Date,  a  fraction,
expressed as a percentage,  the numerator of which is the aggregate  Certificate
Principal Balance of the Super

                                       15
<PAGE>

Senior  Certificates  immediately  prior  to  such  Distribution  Date  and  the
denominator  of which is the  aggregate  Certificate  Principal  Balance  of all
Senior Certificates (other than the Class A-P Certificates) immediately prior to
such Distribution Date.]

      [TAC Certificates: Any Class [___] Certificate.]

      [TAC Distribution Amount: As of any Distribution Date, the amount required
to reduce the Certificate  Principal  Balances of the TAC  Certificates to their
Targeted Principal Balances as of such Distribution Date.]

      [Targeted  Principal  Balances:  With respect to the TAC  Certificates and
each  Distribution  Date,  the  amount set forth for such  Certificates  on such
Distribution Date on Exhibit [__] hereto.]

      Uncertificated  Accrued Interest:  With respect to each Distribution Date,
(i)  as to  each  Uncertificated  REMIC  I  Regular  Interest  other  than  each
Uncertificated  REMIC I Regular  Interest  Z, an amount  equal to the  aggregate
amount of Accrued Certificate  Interest that would result under the terms of the
definition  thereof on the Related Classes of  Certificates if the  Pass-Through
Rate on such Classes were equal to the Uncertificated  Pass-Through Rate on such
Uncertificated REMIC I Regular Interest,  (ii) as to each Uncertificated REMIC I
Regular  Interest  Z and each  Uncertificated  REMIC II Regular  Interest  Z, an
amount  equal to one  month's  interest  at the Pool Strip  Rate of the  related
Mortgage  Loan on the  principal  balance of such  Mortgage Loan reduced by such
Interest's  pro-rata  share  of any  prepayment  interest  shortfalls  or  other
reductions of interest allocable to the Class A-V Certificates.

      Uncertificated   Pass-Through   Rate:   With   respect   to  each  of  the
Uncertificated  REMIC I Regular  Interests  the per annum rate  specified in the
definition of  Uncertificated  REMIC I Regular  Interests.  With respect to each
Uncertificated  REMIC I  Regular  Interest  Z and each  Uncertificated  REMIC II
Regular Interest Z, the Pool Strip Rate for the related Mortgage Loan.

      Uncertificated  Principal  Balance:  With  respect to each  Uncertificated
REMIC I Regular Interest, as defined in the definition of Uncertificated REMIC I
Regular Interests.

      Uncertificated  REMIC I  Regular  Interests:  [Insert  all  REMIC  Regular
Interests in lower tier REMICS.] The Uncertificated  REMIC I Regular Interests Z
together with the interests  identified in the table below, each representing an
undivided  beneficial  ownership  interest in REMIC I, and having the  following
characteristics:

      1.    The principal balance from time to time of each Uncertificated REMIC
            I Regular Interest identified in the table below shall be the amount
            identified as the Initial  Principal  Balance thereof in such table,
            minus (ii) the sum of (x) the  aggregate  of all amounts  previously
            deemed  distributed  with  respect to such  interest  and applied to
            reduce the  Uncertificated  Principal  Balance  thereof  pursuant to
            Section  10.04(a)(ii)  and (y) the  aggregate of all  reductions  in
            Certificate  Principal Balance deemed to have occurred in connection
            with Realized  Losses that were previously  deemed  allocated to the
            Uncertificated  Principal  Balance  of such  Uncertificated  REMIC I
            Regular  Interest  pursuant to Section  10.04(d),  which  equals the
            aggregate   principal   balance  of  the  Classes  of   Certificates

                                       16
<PAGE>

            identified  as  related  to  such  Uncertificated  REMIC  I  Regular
            Interest in such table.

      2.    The Uncertificated Pass-Through Rate for each Uncertificated REMIC I
            Regular  Interest  identified  in the table  below  shall be the per
            annum rate set forth in the Pass-Through Rate column of such table.

      3.    The  Uncertificated  REMIC I  Distribution  Amount  for each REMIC I
            Regular  Interest  identified  in the table  below shall be, for any
            Distribution  Date,  the amount deemed  distributed  with respect to
            such  Uncertificated  REMIC I Regular Interest on such  Distribution
            Date pursuant to the provisions of Section 10.04(a).

--------------------------------------------------------------------------------
Uncertificated                                                    Initial
REMIC I               Related Classes          Pass-Through      Principal
Regular Interest      of Certificates              Rate           Balance
--------------------------------------------------------------------------------
V                 Class [______________]          [____]%        $[_______]
--------------------------------------------------------------------------------
W                 Class [______________]          [____]%        $[_______]
--------------------------------------------------------------------------------
X                 Class [______________]          [____]%        $[_______]
--------------------------------------------------------------------------------
Y                 Class [______________]          [____]%        $[_______]
--------------------------------------------------------------------------------

      Uncertificated  REMIC I  Regular  Interests  Z: The  [___]  uncertificated
partial undivided  beneficial  ownership  interests in the Trust Fund,  numbered
sequentially  from 1 to [___],  each  relating to the  particular  Mortgage Loan
identified by such sequential number on the Mortgage Loan Schedule,  each having
no principal  balance,  and each bearing  interest at the respective  Pool Strip
Rate on the Stated Principal Balance of the related Mortgage Loan.

      Uncertificated  REMIC I Regular  Interests  Z  Distribution  Amount:  With
respect  to  any  Distribution  Date,  the  sum  of  the  amounts  deemed  to be
distributed  on  the  Uncertificated  REMIC  I  Regular  Interests  Z  for  such
Distribution Date pursuant to Section 10.04(a).

      Uncertificated REMIC I Regular Interest Distribution Amounts: With respect
to each Uncertificated  REMIC I Regular Interest,  other than the Uncertificated
REMIC I Regular Interests Z, the amount specified as the Uncertificated  REMIC I
Regular Interest  Distribution  Amount with respect thereto in the definition of
Uncertificated  REMIC I Regular  Interests.  With respect to the  Uncertificated
REMIC I Regular  Interests  Z, the  Uncertificated  REMIC I Regular  Interests Z
Distribution Amount.

      [Uncertificated   REMIC  II  Regular   Interests  Z:  Each  of  the  [___]
uncertificated  partial  undivided  beneficial  ownership  interests in REMIC II
numbered  sequentially  from 1 through  [___] each  relating to the  identically
numbered  Uncertificated  REMIC I Regular  Interests Z, each having no principal
balance and bearing  interest at a rate equal to the related  Pool Strip Rate on
the Stated  Principal  Balance of the Mortgage  Loan related to the  identically
numbered   Uncertificated   REMIC  I  Regular   Interests  Z,   comprising  such
Uncertificated  REMIC  II  Regular  Interest's  pro  rata  share  of the  amount
distributed pursuant to Sections 10.04(a) and (b).]

                                       17
<PAGE>

      [Uncertificated  REMIC II  Regular  Interests  Distribution  Amount:  With
respect  to  any  Distribution  Date,  the  sum  of  the  amounts  deemed  to be
distributed  on  the  Uncertificated  REMIC  I  Regular  Interests  Z  for  such
Distribution Date pursuant to Section 4.02(a).]

      Underwriter: [_____________].

      Section 1.02.  Use of Words and Phrases.

      "Herein," "hereby," "hereunder," "hereof,"  "hereinbefore,"  "hereinafter"
and other  equivalent  words refer to the Pooling and  Servicing  Agreement as a
whole. All references herein to Articles, Sections or Subsections shall mean the
corresponding  Articles,  Sections and  Subsections in the Pooling and Servicing
Agreement.  The  definitions  set forth herein include both the singular and the
plural.

      References  in the Pooling and  Servicing  Agreement to  "interest" on and
"principal"  of the  Mortgage  Loans  shall  mean,  with  respect  to the Sharia
Mortgage Loans,  amounts in respect profit  payments and  acquisition  payments,
respectively.

      Section 1.03.  [Determination of LIBOR.

      LIBOR  applicable  to the  calculation  of the  Pass-Through  Rates on the
Floater Certificates and Inverse Floater Certificates,  if any, for any Interest
Accrual  Period  (other  than  the  initial  Interest  Accrual  Period)  will be
determined on each LIBOR Rate Adjustment Date.

      On each LIBOR Rate  Adjustment  Date,  LIBOR shall be  established  by the
Trustee  and, as to any  Interest  Accrual  Period,  will equal the rate for one
month United  States dollar  deposits  that appears on the Telerate  Screen Page
3750 as of  11:00  a.m.,  London  time,  on such  LIBOR  Rate  Adjustment  Date.
"Telerate  Screen Page 3750" means the  display  designated  as page 3750 on the
Telerate  Service (or such other page as may replace  page 3750 on that  service
for the purpose of displaying London interbank offered rates of major banks). If
such rate does not appear on such page (or such other page as may  replace  that
page on that service, or if such service is no longer offered, LIBOR shall be so
established  by use of such other  service for  displaying  LIBOR or  comparable
rates as may be  selected  by the  Trustee  after  consultation  with the Master
Servicer),  the rate will be the Reference Bank Rate. The "Reference  Bank Rate"
will be determined on the basis of the rates at which  deposits in U.S.  Dollars
are offered by the  reference  banks  (which shall be any three major banks that
are engaged in  transactions  in the London  interbank  market,  selected by the
Trustee after  consultation  with the Master Servicer) as of 11:00 a.m.,  London
time, on the LIBOR Rate Adjustment  Date to prime banks in the London  interbank
market for a period of one month in amounts approximately equal to, with respect
to each of the  Floater  Certificates  and  Inverse  Floater  Certificates,  the
Certificate  Principal Balances of the Floater  Certificates and Inverse Floater
Certificates,  respectively,  then  outstanding.  The Trustee  will  request the
principal London office of each of the reference banks to provide a quotation of
its rate. If at least two such  quotations  are  provided,  the rate will be the
arithmetic  mean of the quotations  rounded up to the next multiple of 1/16%. If
on such date fewer than two quotations are provided as requested,  the rate will
be the  arithmetic  mean of the rates  quoted by one or more major  banks in New
York City,  selected by the Trustee after consultation with the Master Servicer,
as of 11:00 a.m., New York City time, on such date for

                                       18
<PAGE>

loans in U.S.  Dollars  to leading  European  banks for a period of one month in
amounts approximately equal to, with respect to each of the Floater Certificates
and Inverse  Floater  Certificates,  the Certificate  Principal  Balances of the
Floater  Certificates  and  Inverse  Floater  Certificates,  respectively,  then
outstanding.  If no such quotations can be obtained,  the rate will be LIBOR for
the prior Distribution Date.

      The  establishment  of LIBOR by the  Trustee on any LIBOR Rate  Adjustment
Date  and  the  Trustee's  subsequent  calculation  of  the  Pass-Through  Rates
applicable to each of the Floater  Certificates and Inverse Floater Certificates
for the relevant Interest Accrual Period, in the absence of manifest error, will
be final and binding.

      Promptly  following  each LIBOR Rate  Adjustment  Date the  Trustee  shall
supply the Master  Servicer  with the results of its  determination  of LIBOR on
such date.  Furthermore,  the Trustee  will supply to any  Certificateholder  so
requesting  by  telephone  the  Pass-Through   Rates  on  each  of  the  Floater
Certificates   and  Inverse  Floater   Certificates  for  the  current  and  the
immediately preceding Interest Accrual Period.]

                                       19
<PAGE>

                                   ARTICLE II

                          CONVEYANCE OF MORTGAGE LOANS;

                        ORIGINAL ISSUANCE OF CERTIFICATES

      Section  2.01. Conveyance of  Mortgage  Loans.  (See  Section  2.01 of the
                     Standard Terms)

      Section  2.02. Acceptance  by  Trustee.  (See Section 2.02 of the Standard
                     Terms)

      Section  2.03. Representations,  Warranties  and  Covenants of  the Master
                     Servicer and the Company.

      (a) For representations,  warranties and covenants of the Master Servicer,
see Section 2.03(a) of the Standard Terms.

      (b) The  Company  hereby  represents  and  warrants to the Trustee for the
benefit of  Certificateholders  that as of the Closing  Date (or,  if  otherwise
specified below, as of the date so specified):

            (i) No  Mortgage  Loan is 30 or more days  Delinquent  in payment of
      principal  and  interest as of the Cut-off  Date and no Mortgage  Loan has
      been so  Delinquent  more than once in the  12-month  period  prior to the
      Cut-off Date;

            (ii) The information set forth in Exhibit One hereto with respect to
      each Mortgage Loan or the Mortgage  Loans, as the case may be, is true and
      correct in all  material  respects at the date or dates  respecting  which
      such information is furnished;

            (iii) The Mortgage Loans are  fully-amortizing  (subject to interest
      only periods, if applicable), fixed-rate mortgage loans with level Monthly
      Payments  due,  with respect to a majority of the Mortgage  Loans,  on the
      first  day  of  each  month  and  terms  to  maturity  at  origination  or
      modification of not more than 30 years;

            (iv) To the best of the Company's knowledge,  except with respect to
      [___] Mortgage  Loans  representing  approximately  [___]% of the Mortgage
      Loans by aggregate Stated Principal Balance, if a Mortgage Loan is secured
      by a Mortgaged  Property  with a  Loan-to-Value  Ratio at  origination  in
      excess of 80%, such  Mortgage  Loan is the subject of a Primary  Insurance
      Policy that  insures (a) at least 35% of the Stated  Principal  Balance of
      the Mortgage Loan at  origination  if the  Loan-to-Value  Ratio is between
      100.00% and 95.01%,  (b) at least 30% of the Stated  Principal  Balance of
      the Mortgage Loan at  origination  if the  Loan-to-Value  Ratio is between
      95.00% and 90.01%,  (c) at least 25% of such balance if the  Loan-to-Value
      Ratio is between 90.00% and 85.01% and (d) at least 12% of such balance if
      the  Loan-to-Value  Ratio is between 85.00% and 80.01%. To the best of the
      Company's  knowledge,  each such Primary Insurance Policy is in full force
      and effect and the Trustee is entitled to the benefits thereunder;

            (v) The  issuers of the Primary  Insurance  Policies  are  insurance
      companies whose claims-paying  abilities are currently  acceptable to each
      Rating Agency;

                                       20
<PAGE>

            (vi) No more  than  [___]%  of the  [Mortgage]  [Group  CB] Loans by
      aggregate Stated  Principal  Balance as of the Cut-off Date are secured by
      Mortgaged Properties located in any one zip code area in California and no
      more than  [___]% of the  Mortgage  Loans by  aggregate  Stated  Principal
      Balance as of the Cut-off Date are secured by Mortgaged Properties located
      in any one zip code area outside  California[;  and no more than [___]% of
      the  [Group  NB] Loans by  aggregate  Stated  Principal  Balance as of the
      Cut-off  Date are secured by Mortgaged  Properties  located in any one zip
      code area in California and no more than [___]% of the  [Mortgage]  [Group
      CB] Loans by aggregate Stated Principal Balance as of the Cut-off Date are
      secured by Mortgaged  Properties  located in any one zip code area outside
      California];

            (vii) The  improvements  upon the Mortgaged  Properties  are insured
      against loss by fire and other  hazards as required by the Program  Guide,
      including  flood  insurance if required under the National Flood Insurance
      Act of 1968, as amended.  The Mortgage  requires the Mortgagor to maintain
      such casualty insurance at the Mortgagor's expense, and on the Mortgagor's
      failure  to do so,  authorizes  the holder of the  Mortgage  to obtain and
      maintain such insurance at the Mortgagor's  expense and seek reimbursement
      therefor from the Mortgagor;

            (viii)  Immediately prior to the assignment of the Mortgage Loans to
      the  Trustee,  the  Company  had good title to, and was the sole owner of,
      each  Mortgage  Loan free and clear of any pledge,  lien,  encumbrance  or
      security   interest   (other   than  rights  to   servicing   and  related
      compensation)  and such  assignment  validly  transfers  ownership  of the
      Mortgage  Loans  to the  Trustee  free  and  clear  of any  pledge,  lien,
      encumbrance or security interest;

            (ix)  Approximately  [___]% of the  [Mortgage]  [Group  CB] Loans by
      aggregate   Stated   Principal   Balance  as  of  the  Cut-off  Date  were
      underwritten  under a reduced loan  documentation  program,  approximately
      [___]% of the [Mortgage]  [Group CB] Loans by aggregate  Stated  Principal
      Balance as of the Cut-off Date were underwritten  under a no-stated income
      program,  and  approximately  [___]% of the [Mortgage] [Group CB] Loans by
      aggregate   Stated   Principal   Balance  as  of  the  Cut-off  Date  were
      underwritten under a no income/no asset program[; and approximately [___]%
      of the [Group NB] Loans by aggregate  Stated  Principal  Balance as of the
      Cut-off Date were underwritten under a reduced loan documentation program,
      approximately [___]% of the [Group NB] Loans by aggregate Stated Principal
      Balance as of the Cut-off Date were underwritten  under a no-stated income
      program,  and  approximately  [___]% of the [Group NB] Loans by  aggregate
      Stated Principal Balance as of the Cut-off Date were underwritten  under a
      no income/no asset program];

            (x) Except with respect to  approximately  [___]% of the  [Mortgage]
      [Group CB] Loans by aggregate Stated  Principal  Balance as of the Cut-off
      Date,  [and  approximately  [___]% of the  [Group  NB] Loans by  aggregate
      Stated   Principal   Balance  as  of  the  Cut-off  Date,]  the  Mortgagor
      represented in its loan  application  with respect to the related Mortgage
      Loan that the Mortgaged Property would be owner-occupied;

            (xi) [None] of the Mortgage Loans are Buydown Mortgage Loans;

                                       21
<PAGE>

            (xii) Each Mortgage  Loan  constitutes  a qualified  mortgage  under
      Section  860G(a)(3)(A)  of  the  Code  and  Treasury  Regulations  Section
      1.860G-2(a)(1);

            (xiii) A policy of title  insurance  was effective as of the closing
      of each  Mortgage  Loan and is valid and binding and remains in full force
      and effect,  unless the Mortgaged  Properties  are located in the State of
      Iowa and an attorney's  certificate  has been provided as described in the
      Program Guide;

            (xiv)  [None] of the  Mortgage  Loans is a  Cooperative  Loan;  with
      respect to a Mortgage Loan that is a  Cooperative  Loan,  the  Cooperative
      Stock that is  pledged  as  security  for the  Mortgage  Loan is held by a
      person as a tenant-stockholder  (as defined in Section 216 of the Code) in
      a cooperative housing corporation (as defined in Section 216 of the Code);

            (xv)  With  respect  to  each  Mortgage  Loan  originated   under  a
      "streamlined"  Mortgage  Loan  program  (through  which no new or  updated
      appraisals of Mortgaged  Properties  are obtained in  connection  with the
      refinancing  thereof),  the related Seller has represented that either (a)
      the value of the related  Mortgaged  Property as of the date the  Mortgage
      Loan was originated was not less than the appraised value of such property
      at the time of  origination  of the  refinanced  Mortgage  Loan or (b) the
      Loan-to-Value  Ratio of the Mortgage Loan as of the date of origination of
      the Mortgage Loan generally meets the Company's underwriting guidelines;

            (xvi) Interest on each Mortgage Loan is calculated on the basis of a
      360-day year consisting of twelve 30-day months;

            (xvii) [None] of the Mortgage Loans contain in the related  Mortgage
      File a Destroyed Mortgage Note;

            (xviii) No more than [___]% of the [Mortgage]  [Group CB] Loans [and
      [___]% of the [Group NB] Loans by aggregate Stated Principal Balance as of
      the Cut-off Date will have been made to  International  Borrowers,  and no
      such Mortgagor is a member of a foreign diplomatic mission with diplomatic
      rank;

            (xix) No Mortgage  Loan  provides for  payments  that are subject to
      reduction by withholding taxes levied by any foreign  (non-United  States)
      sovereign government; and

            (xx) [None] of the Mortgage  Loans are Additional  Collateral  Loans
      and [none] of the Mortgage Loans are Pledged Asset Loans.

It is understood and agreed that the representations and warranties set forth in
this Section 2.03(b) shall survive delivery of the respective Custodial Files to
the Trustee or the Custodian.

      Upon discovery by any of the Company, the Master Servicer,  the Trustee or
the Custodian of a breach of any of the representations and warranties set forth
in this Section 2.03(b) that  materially and adversely  affects the interests of
the  Certificateholders  in any Mortgage Loan, the party discovering such breach
shall give prompt written  notice to the other parties (the  Custodian  being so
obligated under a Custodial Agreement); provided, however, that

                                       22
<PAGE>

in the event of a breach of the representation and warranty set forth in Section
2.03(b)(xii),  the party  discovering  such breach shall give such notice within
five days of discovery. Within 90 days of its discovery or its receipt of notice
of  breach,  the  Company  shall  either  (i) cure such  breach in all  material
respects or (ii) purchase such Mortgage Loan from the Trust Fund at the Purchase
Price and in the manner set forth in Section  2.02;  provided  that the  Company
shall have the option to  substitute  a Qualified  Substitute  Mortgage  Loan or
Loans  for such  Mortgage  Loan if such  substitution  occurs  within  two years
following the Closing Date;  provided that if the omission or defect would cause
the Mortgage Loan to be other than a "qualified  mortgage" as defined in Section
860G(a)(3) of the Code,  any such cure or  repurchase  must occur within 90 days
from the date  such  breach  was  discovered.  Any  such  substitution  shall be
effected  by the  Company  under the same terms and  conditions  as  provided in
Section 2.04 for  substitutions  by  Residential  Funding.  It is understood and
agreed that the  obligation of the Company to cure such breach or to so purchase
or  substitute  for any Mortgage Loan as to which such a breach has occurred and
is continuing shall constitute the sole remedy  respecting such breach available
to the Certificateholders or the Trustee on behalf of the Certificateholders.

      Section 2.04. Representations and Warranties of Sellers. (See Section 2.04
                    of the Standard Terms)

      Section 2.05. Execution  and  Authentication of Certificates/  Issuance of
                    Certificates Evidencing Interests in REMIC I Certificates

      The Trustee  acknowledges  the  assignment to it of the Mortgage Loans and
the  delivery  of the  Custodial  Files to it, or the  Custodian  on its behalf,
subject to any exceptions noted, together with the assignment to it of all other
assets included in the Trust Fund and/or the applicable REMIC,  receipt of which
is  hereby  acknowledged.  Concurrently  with  such  delivery  and  in  exchange
therefor,  the Trustee,  pursuant to the written request of the Company executed
by an officer of the Company,  has executed and caused to be  authenticated  and
delivered to or upon the order of the Company the  [Certificates  in  authorized
denominations  that  evidence  ownership of the entire  Trust Fund.]  [Class R-I
Certificates in authorized  denominations which together with the Uncertificated
REMIC I Regular Interests, evidence ownership of REMIC I.]

      Section 2.06. [Conveyance of  Uncertificated  REMIC I and REMIC II Regular
                    Interests; Acceptance by the Trustee.

      The Company,  as of the Closing Date, and concurrently  with the execution
and delivery hereof,  does hereby assign without  recourse all the right,  title
and  interest  of the  Company  in and to the  Uncertificated  REMIC  I  Regular
Interests  to the  Trustee  for the  benefit  of the  Holders  of each  Class of
Certificates (other than the Class R-I Certificates).  The Trustee  acknowledges
receipt of the  Uncertificated  REMIC I Regular  Interests  and declares that it
holds and will hold the same in trust for the  exclusive  use and benefit of all
present and future Holders of each Class of  Certificates  (other than the Class
R-I  Certificates).  The rights of the  Holders  of each  Class of  Certificates
(other  than the Class  R-I  Certificates)  to  receive  distributions  from the
proceeds of REMIC II in respect of such Classes,  and all ownership interests of
the Holders of such Classes in such distributions, shall be as set forth in this
Agreement.]

                                       23
<PAGE>

      Section 2.07.  [Issuance of Certificates Evidencing Interest in REMIC II.

      The Trustee  acknowledges the assignment to it of the Uncertificated REMIC
I Regular  Interests  and,  concurrently  therewith  and in  exchange  therefor,
pursuant  to the written  request of the  Company  executed by an officer of the
Company,  the Trustee has executed and caused to be authenticated  and delivered
to or upon the order of the Company, all Classes of Certificates (other than the
Class R-I Certificates) in authorized denominations, which evidence ownership of
the entire REMIC II.]

      Section  2.08. Purposes  and  Powers of the Trust (See Section 2.08 of the
                     Standard Terms).

                                       24
<PAGE>

                                  ARTICLE III

                          ADMINISTRATION AND SERVICING

                                OF MORTGAGE LOANS

                     (See Article III of the Standard Terms)

                                       25
<PAGE>

                                   ARTICLE IV

                         PAYMENTS TO CERTIFICATEHOLDERS

      Section 4.01.  Certificate   Account.  (See  Section  4.01 of the Standard
                     Terms)

      Section 4.02.  Distributions.

      (a) On each  Distribution  Date (x) the Master  Servicer  on behalf of the
Trustee or (y) the Paying Agent  appointed by the Trustee,  shall  distribute to
the  Master  Servicer,  in  the  case  of a  distribution  pursuant  to  Section
4.02(a)([iii][iv])  below,  the amount  required to be distributed to the Master
Servicer or a Sub-Servicer pursuant to Section  4.02(a)([iii][iv]) below, and to
each  Certificateholder  of record on the next preceding Record Date (other than
as  provided  in  Section  9.01  respecting  the final  distribution)  either in
immediately  available  funds (by wire  transfer or otherwise) to the account of
such  Certificateholder at a bank or other entity having appropriate  facilities
therefor,  if such  Certificateholder has so notified the Master Servicer or the
Paying  Agent,  as the case may be,  or,  if such  Certificateholder  has not so
notified the Master  Servicer or the Paying  Agent by the Record Date,  by check
mailed to such  Certificateholder at the address of such Holder appearing in the
Certificate  Register  such  Certificateholder's  share  (which  share  (A) with
respect to each Class of Certificates  (other than any Subclass of the Class A-V
Certificates),  shall be  based on the  aggregate  of the  Percentage  Interests
represented by Certificates  of the applicable  Class held by such Holder or (B)
with  respect to any Subclass of the Class A-V  Certificates,  shall be equal to
the amount (if any)  distributed  pursuant to Section  4.02(a)(i)  below to each
Holder of a Subclass thereof) of the following  amounts,  in the following order
of priority  (subject to the provisions of Section 4.02(b),  (c)[ and (d)][, (d)
and (f)]  below),  in each case to the  extent  of the  [related  or  specified]
Available  Distribution  Amount  remaining  in the  case  of  clauses  (i)  [and
(ii)][through (iii), and to the extent of the Available  Distribution Amount for
each Loan Group remaining in the case of clauses (iv) through (xviii)]:

            (i)  [to  the  Senior   Certificates   (other  than  the  Class  A-P
      Certificates)  on a pro rata basis based on Accrued  Certificate  Interest
      payable  on such  Certificates  with  respect to such  Distribution  Date,
      Accrued   Certificate   Interest  on  such  Classes  of  Certificates  (or
      Subclasses,  if any, with respect to the Class A-V  Certificates) for such
      Distribution Date, plus any Accrued Certificate Interest thereon remaining
      unpaid from any previous  Distribution Date except as provided in the last
      paragraph of this Section 4.02(a);]

            [(X) from the Available  Distribution  Amount related to the CB Loan
      Group, to the Class CB Certificateholders  and Class R Certificateholders,
      on a pro rata basis based on Accrued Certificate Interest on such Class of
      Certificates  for such  Distribution  Date,  plus any Accrued  Certificate
      Interest  thereon  remaining  unpaid from any previous  Distribution  Date
      except as provided in the last paragraph of this Section 4.02(a);

            (Y) from the Available  Distribution  Amount  related to the NB Loan
      Group,  to the Class NB  Certificateholders,  on a pro rata basis based on
      Accrued Certificate  Interest payable on such Certificates with respect to
      such Distribution  Date, Accrued  Certificate  Interest on such Classes of
      Certificates (or Subclasses, if any, with

                                       26
<PAGE>

      respect to the Class A-V Certificates)  for such  Distribution  Date, plus
      any  Accrued  Certificate  Interest  thereon  remaining  unpaid  from  any
      previous  Distribution  Date except as provided in the last  paragraph  of
      this Section 4.02(a); and

            (Z) from the Available  Distribution Amount derived from the related
      Loan Group, on a parity with the  distributions in Sections  4.02(a)(i)(X)
      and  4.02(a)(i)(Y),  as  applicable,  to the  Class  A-V  Certificates  in
      proportion  to the  respective  amounts  of Accrued  Certificate  Interest
      thereon derived from each Loan Group,  Accrued Certificate Interest on the
      Class A-V Certificates  with respect to such Distribution Date and derived
      from the related Loan Group, plus any Accrued Certificate Interest thereon
      remaining unpaid from any previous  Distribution Date with respect to such
      Loan  Group  except as  provided  in the last  paragraph  of this  Section
      4.02(a);] and

            (ii)  (X)  to  the  Class  A-P  Certificates,  [from  the  Available
      Distribution  Amount for each Loan Group in proportion  to the  respective
      amounts of the Class A-P Principal  Distribution  Amount derived from each
      Loan Group,] the Class A-P Principal Distribution Amount; and

            (Y)  to  the  Senior   Certificates   (other   than  the  Class  A-P
      Certificates), in the priorities and amounts set forth in Section 4.02(b),
      (c)[ and (e)][, (d) and (f)], the sum of the following  (applied to reduce
      the  Certificate  Principal  Balances  of  such  Senior  Certificates,  as
      applicable):

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

                        (1) the  principal  portion of each Monthly  Payment due
                  during the  related  Due Period on each  Outstanding  Mortgage
                  Loan [in the  related  Loan  Group]  (other  than the  related
                  Discount  Fraction of the  principal  portion of such  payment
                  with  respect to a  Discount  Mortgage  Loan),  whether or not
                  received on or prior to the related  Determination Date, minus
                  the  principal  portion of any Debt Service  Reduction  (other
                  than the related Discount Fraction of the principal portion of
                  such Debt Service  Reductions  with  respect to each  Discount
                  Mortgage  Loan) which  together with other  Bankruptcy  Losses
                  exceeds the Bankruptcy Amount;

                        (2) the Stated  Principal  Balance of any Mortgage  Loan
                  [in the related Loan Group]  repurchased  during the preceding
                  calendar  month  (or  deemed to have  been so  repurchased  in
                  accordance  with Section  3.07(b))  pursuant to Section  2.02,
                  2.03,  2.04 or 4.07 and the amount of any shortfall  deposited
                  in the Custodial  Account in connection with the  substitution
                  of a Deleted  Mortgage  Loan [in such Loan Group]  pursuant to
                  Section  2.03 or 2.04  during  the  preceding  calendar  month
                  (other  than the  related  Discount  Fraction  of such  Stated
                  Principal  Balance or shortfall  with respect to each Discount
                  Mortgage Loan); and

                                       27
<PAGE>

                        (3)  the  principal  portion  of all  other  unscheduled
                  collections  [with  respect to the related Loan Group]  (other
                  than  Principal  Prepayments  in  Full  and  Curtailments  and
                  amounts  received in connection with a Cash Liquidation or REO
                  Disposition   of  a  Mortgage   Loan   described   in  Section
                  4.02(a)(ii)(Y)(B) of this Series Supplement, including without
                  limitation  Insurance Proceeds,  Liquidation  Proceeds and REO
                  Proceeds)  received  during the preceding  calendar  month (or
                  deemed to have been so received  in  accordance  with  Section
                  3.07(b) of the  Standard  Terms) to the extent  applied by the
                  Master  Servicer as  recoveries  of  principal  of the related
                  Mortgage Loan  pursuant to Section 3.14 of the Standard  Terms
                  (other than the  related  Discount  Fraction of the  principal
                  portion of such unscheduled collections,  with respect to each
                  Discount Mortgage Loan);

                  (B) with  respect to each  Mortgage  Loan [in the related Loan
            Group] for which a Cash  Liquidation or a REO  Disposition  occurred
            during the preceding  calendar month (or was deemed to have occurred
            during  such  period  in  accordance  with  Section  3.07(b)  of the
            Standard  Terms)  and did not result in any  Excess  Special  Hazard
            Losses,   Excess  Fraud   Losses,   Excess   Bankruptcy   Losses  or
            Extraordinary  Losses,  an  amount  equal to the  lesser  of (a) the
            [related]  Senior  Percentage for such  Distribution  Date times the
            Stated  Principal  Balance of such  Mortgage  Loan  (other  than the
            related  Discount  Fraction of such Stated Principal  Balance,  with
            respect to each Discount Mortgage Loan) and (b) the [related] Senior
            Accelerated Distribution Percentage for such Distribution Date times
            the related  unscheduled  collections  (including without limitation
            Insurance  Proceeds,  Liquidation  Proceeds and REO Proceeds) to the
            extent applied by the Master  Servicer as recoveries of principal of
            the related  Mortgage  Loan pursuant to Section 3.14 of the Standard
            Terms (in each  case  other  than the  portion  of such  unscheduled
            collections,  with respect to a Discount Mortgage Loan,  included in
            Section 4.02(b)(i)(C) of this Series Supplement);

                  (C) the [related] Senior Accelerated  Distribution  Percentage
            for such  Distribution  Date times the  aggregate  of all  Principal
            Prepayments  in  Full  [with  respect  to the  related  Loan  Group]
            received in the related  Prepayment  Period and  Curtailments  [with
            respect  to the  related  Loan  Group]  received  in  the  preceding
            calendar  month  (other than the related  Discount  Fraction of such
            Principal Prepayments in Full and Curtailments, with respect to each
            Discount Mortgage Loan);

                  (D) any [portion of the] Excess  Subordinate  Principal Amount
            for such  Distribution  Date  [allocated to the related Loan Group];
            [and]

                  (E) any amounts described in subsection (ii)(Y),  clauses (A),
            (B) and (C) of this Section 4.02(a),  as determined for any previous
            Distribution  Date, which remain unpaid after application of amounts
            previously  distributed  pursuant  to this  clause (E) to the extent
            that such amounts are not attributable to Realized Losses which have
            been allocated to the Subordinate Certificates; [and]

                                       28
<PAGE>

            [(Z) to the  Holders  of the Class CB or Class NB  Certificates,  as
      applicable,  amounts  required  to  be  distributed  pursuant  to  Section
      4.02(c);

            [(iii)] if the aggregate  Certificate Principal Balance of the Class
      CB  Certificates  and Class R  Certificates  or Class NB  Certificates  is
      greater than the aggregate Stated Principal  Balance of the Mortgage Loans
      in the related  Loan Group  (other than the related  Discount  Fraction of
      each  Discount  Mortgage  Loan in the related  Loan Group) and the Class M
      Certificates or Class B Certificates are still  outstanding,  in each case
      after giving effect to distributions to be made on such Distribution Date,
      to the  Holders  of such Class or Classes of Class CB and Class R or Class
      NB Certificates, as applicable, an amount equal to one month's interest at
      a rate  equal to the  Discount  Net  Mortgage  Rate on the  amount  of the
      difference  between the aggregate  Certificate  Principal  Balance of such
      Class or  Classes of Class CB  Certificates  and Class R  Certificates  or
      Class  NB  Certificates,  as the  case may be,  and the  aggregate  Stated
      Principal   Balance  of  its  related  Loan  Group,   from  the  Available
      Distribution  Amount for the other  Loan  Group with  respect to which the
      aggregate  Stated  Principal  Balance of the  Mortgage  Loans in that Loan
      Group are not less than the aggregate Certificate Principal Balance of the
      related  Classes  of Senior  Certificates,  applied  first to pay  Accrued
      Certificate Interest on such Class or Classes of Class CB Certificates and
      Class R Certificates on a pro rata basis or Class NB Certificates on a pro
      rata basis to the extent not paid on such  Distribution  Date  pursuant to
      Section 4.02(a)(i),  and then to pay principal on such Class or Classes of
      Class CB Certificates and Class R Certificates or Class NB Certificates in
      accordance  with the  priorities set forth in Section  4.02(b),  until the
      Certificate  Principal  Balance of such Class CB Certificates  and Class R
      Certificates  or Class NB  Certificates  is equal to the aggregate  Stated
      Principal Balance of the Mortgage Loans in the related Loan Group;]

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

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

            (v) to the Holders of the Class M-1 Certificates, an amount equal to
      (x) the  Subordinate  Principal  Distribution  Amount  for  such  Class of
      Certificates [for each Loan Group] for such  Distribution  Date, minus (y)
      the amount of any Class A-P Collection  Shortfalls  for such  Distribution
      Date or  remaining  unpaid for all  previous  Distribution  Dates,  to the
      extent  the  amounts   available   pursuant  to  clause  (x)  of  Sections
      4.02(a)[(vii),  (ix), (xi),  (xiii),  (xiv) and (xv)][(viii),  (x), (xii),
      (xiv),  (xv)  and  (xvi)]  of  this  Series  Supplement  are  insufficient
      therefor, applied in reduction of the Certificate Principal Balance of the
      Class M-1 Certificates;

                                       29
<PAGE>

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

            (vii) to the Holders of the Class M-2 Certificates,  an amount equal
      to (x) the  Subordinate  Principal  Distribution  Amount for such Class of
      Certificates [for each Loan Group] for such  Distribution  Date, minus (y)
      the amount of any Class A-P Collection  Shortfalls  for such  Distribution
      Date or  remaining  unpaid for all  previous  Distribution  Dates,  to the
      extent  the  amounts   available   pursuant  to  clause  (x)  of  Sections
      4.02(a)[(ix),  (xi), (xiii),  (xiv) and (xv)][(x),  (xii), (xiv), (xv) and
      (xvi)] are insufficient therefor,  applied in reduction of the Certificate
      Principal Balance of the Class M-2 Certificates;

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

            (ix) to the Holders of the Class M-3  Certificates,  an amount equal
      to (x) the  Subordinate  Principal  Distribution  Amount for such Class of
      Certificates  [for each Loan Group] for such  Distribution  Date minus (y)
      the amount of any Class A-P Collection  Shortfalls  for such  Distribution
      Date or  remaining  unpaid for all  previous  Distribution  Dates,  to the
      extent  the  amounts   available   pursuant  to  clause  (x)  of  Sections
      4.02(a)[(xi),  (xiii),  (xiv) and (xv)][(xii),  (xiv), (xv) and (xvi)] are
      insufficient  therefor,  applied in reduction of the Certificate Principal
      Balance of the Class M-3 Certificates;

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

            (xi) to the Holders of the Class B-1  Certificates,  an amount equal
      to (x) the  Subordinate  Principal  Distribution  Amount for such Class of
      Certificates  [for each Loan Group] for such  Distribution  Date minus (y)
      the amount of any Class A-P Collection  Shortfalls  for such  Distribution
      Date or  remaining  unpaid for all  previous  Distribution  Dates,  to the
      extent  the  amounts   available   pursuant  to  clause  (x)  of  Sections
      4.02(a)[(xiii),  (xiv) and  (xv)][(xiv),  (xv) and (xvi)] are insufficient
      therefor, applied in reduction of the Certificate Principal Balance of the
      Class B-1 Certificates;

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

            (xiii) to the Holders of the Class B-2 Certificates, an amount equal
      to (x) the  Subordinate  Principal  Distribution  Amount for such Class of
      Certificates  [for each Loan Group] for such  Distribution  Date minus (y)
      the amount of any Class A-P Collection  Shortfalls  for such  Distribution
      Date or  remaining  unpaid for all  previous  Distribution  Dates,  to the
      extent  the  amounts   available   pursuant  to  clause  (x)  of  Sections
      4.02(a)[(xiv) and (xv)][(xv) and (xvi)] are insufficient therefor, applied
      in  reduction  of the  Certificate  Principal  Balance  of the  Class  B-2
      Certificates;

                                       30
<PAGE>

            (xiv) to the Holders of the Class B-3 Certificates,  an amount equal
      to (x) the Accrued  Certificate  Interest  thereon  for such  Distribution
      Date, plus any Accrued Certificate  Interest thereon remaining unpaid from
      any previous  Distribution  Date, except as provided below,  minus (y) the
      amount of any Class A-P Collection  Shortfalls for such  Distribution Date
      or remaining unpaid for all previous Distribution Dates, to the extent the
      amounts available  pursuant to clause (x) of Section  4.02(a)[(xv)][(xvi)]
      are insufficient therefor;

            (xv) to the Holders of the Class B-3  Certificates,  an amount equal
      to (x) the  Subordinate  Principal  Distribution  Amount for such Class of
      Certificates  [for each Loan Group] for such  Distribution  Date minus (y)
      the amount of any Class A-P Collection  Shortfalls  for such  Distribution
      Date or remaining  unpaid for all previous  Distribution  Dates applied in
      reduction  of  the  Certificate   Principal   Balance  of  the  Class  B-3
      Certificates;

            (xvi) to the Senior Certificates,  on a pro rata basis in accordance
      with their respective  outstanding  Certificate  Principal  Balances,  the
      portion, if any, of the Available  Distribution  [Amount][Amounts for each
      Loan Group] remaining after the foregoing distributions, applied to reduce
      the Certificate Principal Balances of such Senior Certificates,  but in no
      event more than the  aggregate of the  outstanding  Certificate  Principal
      Balances of each such Class of Senior  Certificates,  and  thereafter,  to
      each Class of Subordinate  Certificates  then  outstanding  beginning with
      such  Class  with the  Highest  Priority,  any  portion  of the  Available
      Distribution  [Amount][Amounts  for each Loan Group]  remaining  after the
      Senior  Certificates have been retired,  applied to reduce the Certificate
      Principal Balance of each such Class of Subordinate  Certificates,  but in
      no event more than the outstanding  Certificate  Principal Balance of each
      such Class of Subordinate Certificates; and

            (xvii) to the Class [R][R-I]  Certificates,  the balance, if any, of
      the Available Distribution [Amount][Amounts for each Loan Group].

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

      (b)  Distributions  of  principal  on  the  Senior  Certificates  on  each
Distribution  Date occurring prior to the Credit Support  Depletion Date will be
made as follows:

                                       31
<PAGE>

            (i)  first,  to the Class A-P  Certificates,  until the  Certificate
      Principal  Balance  thereof is reduced to zero,  an amount (the "Class A-P
      Principal Distribution Amount") equal to the aggregate of:

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

                  (B) the related Discount  Fraction of the principal portion of
            all unscheduled  collections on each Discount Mortgage Loan received
            during the  preceding  calendar  month or, in the case of  Principal
            Prepayments  in Full,  during the related  Prepayment  Period (other
            than amounts  received in connection with a Cash  Liquidation or REO
            Disposition  of a Discount  Mortgage  Loan  described  in clause (C)
            below),  including Principal  Prepayments in Full,  Curtailments and
            repurchases  (including deemed  repurchases under Section 3.07(b) of
            the Standard Terms) of Discount Mortgage Loans (or, in the case of a
            substitution  of a Deleted  Mortgage Loan, the Discount  Fraction of
            the amount of any shortfall  deposited in the  Custodial  Account in
            connection with such substitution);

                  (C) in connection with the Cash Liquidation or REO Disposition
            of a  Discount  Mortgage  Loan  that did not  result  in any  Excess
            Special Hazard Losses, Excess Fraud Losses, Excess Bankruptcy Losses
            or  Extraordinary  Losses,  an amount equal to the lesser of (1) the
            applicable Discount Fraction of the Stated Principal Balance of such
            Discount  Mortgage Loan immediately  prior to such Distribution Date
            and (2) the  aggregate  amount of the  collections  on such Mortgage
            Loan to the extent applied as recoveries of principal;

                  (D) any  amounts  allocable  to  principal  for  any  previous
            Distribution  Date  (calculated  pursuant to clauses (A) through (C)
            above) that remain undistributed; and

                  (E) the amount of any Class A-P Collection Shortfalls for such
            Distribution  Date  and  the  amount  of any  Class  A-P  Collection
            Shortfalls remaining unpaid for all previous Distribution Dates, but
            only to the extent of the Eligible Funds for such Distribution Date;

            (ii) [Senior Certificates' paydown rules]

      [(c) Prior to the  occurrence  of the Credit  Support  Depletion  Date but
after  the  reduction  of the  Certificate  Principal  Balances  of the Class CB
Certificates  and Class R  Certificates  or Class NB  Certificates  to zero, the
remaining  Class  CB   Certificates   and  Class  R  Certificates  or  Class  NB
Certificates,  as  applicable,  will be entitled to receive,  in addition to any
Mortgagor prepayments related to such Certificates'  respective Loan Group, 100%
of the  Mortgagor  prepayments  on the  Mortgage  Loans in the other Loan Group,
whose related Classes

                                       32
<PAGE>

of Senior Certificates are no longer outstanding,  to be allocated on a pro rata
basis in  accordance  with  their  respective  aggregate  Certificate  Principal
Balances between the remaining Class CB Certificates  and Residual  Certificates
as a group and Class NB Certificates  as a group,  and among the remaining Class
NB Certificates in accordance with the priorities set forth in clause (b) above,
and  in  reduction  of  the  Certificate  Principal  Balances  thereof,  on  any
Distribution Date unless (i) the weighted average of the Subordinate Percentages
for both Loan Groups,  weighted on the basis of the Stated Principal Balances of
the Mortgage Loans in the related Loan Group, is at least two times the weighted
average of the initial Subordinate  Percentages for both Loan Groups (calculated
on such basis) and (ii) the outstanding  principal balance of the Mortgage Loans
in both  Loan  Groups  delinquent  60 days or more  averaged  over  the last six
months,  as a percentage  of the  aggregate  outstanding  Certificate  Principal
Balance of the Subordinate  Certificates,  is less than 50%. In addition, on any
Distribution  Date  prior to the  Credit  Support  Depletion  Date on which  the
aggregate Certificate Principal Balance of the Class CB Certificates and Class R
Certificates  or Class NB  Certificates,  as  applicable,  is  greater  than the
aggregate  Stated  Principal  Balance of the Mortgage  Loans in the related Loan
Group in each  case  after  giving  effect to  distributions  to be made on such
Distribution  Date,  100%  of  the  Mortgagor   prepayments   allocable  to  the
Subordinate  Certificates  on the Mortgage Loans in the other Loan Group will be
distributed  to such  class or  classes  of Class CB  Certificates  and  Class R
Certificates or Class NB  Certificates,  as applicable,  and in reduction of the
Certificate   Principal  Balances  thereof,   until  the  aggregate  Certificate
Principal Balance of such Class or Classes of Certificates  equals the aggregate
Stated Principal Balance of the Mortgage Loans in the related Loan Group. If the
aggregate  Certificate  Principal  Balance  of the  related  Class or Classes of
Senior  Certificates  of more than one Loan Group is greater than the  aggregate
Stated Principal  Balance of the Mortgage Loans in the related Loan Group,  then
the amount described in the sentence above will be allocated on a pro rata basis
among such Class CB, Class R-I, and Class R-II  Certificates as a group or Class
NB  Certificates  as a group,  and  among  the  classes  of any such  group,  as
applicable, in accordance with the priorities set forth in clause (b) above.]

      (c) On or after the Credit Support Depletion Date, all priorities relating
to  distributions  as described in Section 4.02(b) above in respect of principal
among the  various  classes  of Senior  Certificates  (other  than the Class A-P
Certificates)  will be  disregarded,  and (i) [an amount  equal to the  Discount
Fraction  of  the  principal  portion  of  scheduled  payments  and  unscheduled
collections  received or advanced in respect of the Discount Mortgage Loans will
be  distributed  to the  Class  A-P  Certificates,  (ii)  the  Senior  Principal
Distribution  Amount will be  distributed to the remaining  Senior  Certificates
(other  than the Class  A-P  Certificates)  pro rata in  accordance  with  their
respective outstanding  Certificate Principal Balances, and (iii) the amount set
forth in  Section  4.02(a)(i)  will be  distributed  as set forth  therein.][the
remaining  Class CB Principal  Distribution  Amount will be  distributed  to the
Class CB Certificates and Class R Certificates on a pro rata basis in accordance
with their  respective  outstanding  Certificate  Principal  Balances,  (ii) the
remaining  Class NB Principal  Distribution  Amount will be  distributed  to the
Class NB Certificates  on a pro rata basis in accordance  with their  respective
outstanding  Certificate  Principal  Balances,  (iii)  the  amount  set forth in
Section 4.02(a)(i) will be distributed as set forth therein,  and (iv) an amount
equal to the Discount  Fraction of the principal  portion of scheduled  payments
and unscheduled collections received or advanced in respect of Discount Mortgage
Loans will be  distributed  to the Class A-P  Certificates,  from the  Available
Distribution  Amount for each Loan Group in proportion to the respective amounts
of the Class A-P Principal Distribution Amount derived from each Loan Group.]

                                       33
<PAGE>

      (d) After the  reduction  of the  Certificate  Principal  Balances  of the
Senior Certificates (other than the Class A-P Certificates) to zero but prior to
the Credit Support Depletion Date, the Senior Certificates (other than the Class
A-P  Certificates)  will be entitled to no further  distributions  of  principal
thereon and the Available Distribution Amount [for each Loan Group] will be paid
solely to the holders of the Class A-P, Class A-V and Subordinate  Certificates,
in each case as described herein.

      (e) In  addition  to the  foregoing  distributions,  with  respect  to any
Mortgage Loan that was  previously  the subject of a Cash  Liquidation or an REO
Disposition that resulted in a Realized Loss, in the event that within two years
of the date on which such  Realized  Loss was  determined  to have  occurred the
Master Servicer receives amounts,  which the Master Servicer reasonably believes
to represent subsequent recoveries (net of any related liquidation expenses), or
determines that it holds surplus amounts previously  reserved to cover estimated
expenses, specifically related to such Mortgage Loan (including, but not limited
to,  recoveries in respect of the  representations  and  warranties  made by the
related Seller pursuant to the applicable Seller's Agreement and assigned to the
Trustee  pursuant to Section 2.04),  the Master  Servicer shall  distribute such
amounts to the  applicable  Certificateholders  of the Class or Classes to which
such Realized Loss was allocated  (with the amounts to be distributed  allocated
among such Classes in the same proportions as such Realized Loss was allocated),
and within each such Class to the  Certificateholders of record as of the Record
Date  immediately  preceding the date of such  distribution (or if such Class of
Certificates is no longer outstanding,  to the  Certificateholders  of record at
the  time  that  such  Realized  Loss  was  allocated);  provided  that  no such
distribution to any Class of Certificates of subsequent  recoveries related to a
Mortgage Loan shall exceed, either individually or in the aggregate and together
with any other amounts paid in reimbursement therefor, the amount of the related
Realized Loss that was allocated to such Class of Certificates.  Notwithstanding
the  foregoing,  no  such  distribution  shall  be  made  with  respect  to  the
Certificates of any Class to the extent that either (i) such Class was protected
against the related Realized Loss pursuant to any instrument or fund established
under Section  11.01(e) or (ii) such Class of  Certificates  has been  deposited
into  a  separate  trust  fund  or  other   structuring   vehicle  and  separate
certificates  or other  instruments  representing  interests  therein  have been
issued in one or more classes,  and any of such separate  certificates  or other
instruments  was  protected  against the related  Realized  Loss pursuant to any
limited guaranty, payment obligation, irrevocable letter of credit, surety bond,
insurance  policy or similar  instrument  or a reserve  fund,  or a  combination
thereof. Any amount to be so distributed with respect to the Certificates of any
Class shall be distributed by the Master Servicer to the  Certificateholders  of
record as of the Record Date immediately preceding the date of such distribution
(i) with  respect to the  Certificates  of any Class  (other  than the Class A-V
Certificates),  on a pro rata basis based on the Percentage Interest represented
by each  Certificate  of such Class as of such Record Date and (ii) with respect
to the Class A-V  Certificates,  to the Class A-V  Certificates  or any Subclass
thereof in the same proportion as the related  Realized Loss was allocated.  Any
amounts to be so distributed  shall not be remitted to or  distributed  from the
Trust Fund, and shall constitute  subsequent recoveries with respect to Mortgage
Loans that are no longer assets of the Trust Fund.

      (f) Each  distribution  with respect to a Book-Entry  Certificate shall be
paid to the Depository,  as Holder thereof,  and the Depository  shall be solely
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its

                                       34
<PAGE>

normal  procedures.   Each  Depository  Participant  shall  be  responsible  for
disbursing such distribution to the Certificate Owners that it represents and to
each indirect  participating  brokerage  firm (a "brokerage  firm") for which it
acts as agent.  Each brokerage firm shall be responsible for disbursing funds to
the Certificate Owners that it represents.  None of the Trustee, the Certificate
Registrar,  the  Company or the Master  Servicer  shall have any  responsibility
therefor.

      (g) Except as otherwise  provided in Section 9.01, if the Master  Servicer
anticipates that a final  distribution with respect to any Class of Certificates
will be made on the next Distribution  Date, the Master Servicer shall, no later
than the Determination Date in the month of such final distribution,  notify the
Trustee and the Trustee  shall,  no later than two (2) Business  Days after such
Determination  Date,  mail  on  such  date  to each  Holder  of  such  Class  of
Certificates a notice to the effect that: (i) the Trustee  anticipates  that the
final  distribution  with respect to such Class of Certificates  will be made on
such  Distribution  Date  but  only  upon  presentation  and  surrender  of such
Certificates at the office of the Trustee or as otherwise specified therein, and
(ii) no interest shall accrue on such Certificates from and after the end of the
related Interest Accrual Period. In the event that  Certificateholders  required
to surrender  their  Certificates  pursuant to Section  9.01(c) do not surrender
their  Certificates  for final  cancellation,  the  Trustee  shall  cause  funds
distributable  with  respect  to such  Certificates  to be  withdrawn  from  the
Certificate Account and credited to a separate escrow account for the benefit of
such Certificateholders as provided in Section 9.01(d).

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

                                       35
<PAGE>

      Section 4.03.  Statements to Certificateholders;  Statements to the Rating
                     Agencies; Exchange Act Reporting. (See Section  4.03 of the
                     Standard Terms)

      Section  4.04. Distribution  of  Reports to the Trustee  and the  Company;
                     Advances by  the Master  Servicer. (See Section 4.04 of the
                     Standard Terms)

      Section 4.05.  Allocation of Realized Losses.

      Prior to each  Distribution  Date, the Master Servicer shall determine the
total  amount  of  Realized  Losses,   if  any,  that  resulted  from  any  Cash
Liquidation, Servicing Modification, Debt Service Reduction, Deficient Valuation
or REO Disposition that occurred during the related Prepayment Period or, in the
case of a Servicing  Modification  that  constitutes a reduction of the interest
rate on a Mortgage Loan, the amount of the reduction in the interest  portion of
the  Monthly  Payment  due during the  related  Due  Period.  The amount of each
Realized  Loss shall be  evidenced  by an  Officers'  Certificate.  All Realized
Losses, other than Excess Special Hazard Losses,  Extraordinary  Losses,  Excess
Bankruptcy Losses or Excess Fraud Losses, shall be allocated as follows:  first,
to the Class B-3 Certificates  until the Certificate  Principal  Balance thereof
has been  reduced  to zero;  second,  to the  Class B-2  Certificates  until the
Certificate  Principal  Balance thereof has been reduced to zero;  third, to the
Class B-1 Certificates until the Certificate  Principal Balance thereof has been
reduced to zero;  fourth,  to the Class M-3  Certificates  until the Certificate
Principal  Balance  thereof has been  reduced to zero;  fifth,  to the Class M-2
Certificates until the Certificate Principal Balance thereof has been reduced to
zero;  sixth,  to the Class M-1  Certificates  until the  Certificate  Principal
Balance thereof has been reduced to zero; and, thereafter,  if any such Realized
Losses are on a Discount  Mortgage  Loan,  to the Class A-P  Certificates  in an
amount equal to the Discount Fraction of the principal portion thereof,  and the
remainder of such Realized Losses on the Discount  Mortgage Loans and the entire
amount of such Realized Losses on Non-Discount  Mortgage Loans will be allocated
among all the  [Senior  Certificates  (other  than the Class A-P  Certificates)]
[Class CB  Certificates  [and Class R  Certificates]  (in the case of a Group CB
Loan) or among the Class NB Certificates [and Class R Certificates] (in the case
of a Group NB Loan), and the Class A-V Certificates (in the case of the interest
portion of a Realized  Loss on a Mortgage  Loan in either Loan  Group)] on a pro
rata basis,  as described  below.  The principal  portion of any Excess  Special
Hazard Losses,  Excess Bankruptcy Losses,  Excess Fraud Losses and Extraordinary
Losses  on the  Discount  Mortgage  Loans  will be  allocated  to the  Class A-P
Certificates  in an  amount  equal to the  Discount  Fraction  thereof  [and the
remainder of such Realized Losses on the Discount  Mortgage Loans and the entire
amount of such Realized Losses on Non-Discount  Mortgage Loans will be allocated
among the  Senior  Certificates  (other  than the Class  A-P  Certificates)  and
Subordinate  Certificates,  on a pro rata basis, as described below[,  provided,
however,   that  Realized  Losses  otherwise   allocable  to  the  Super  Senior
Certificates  will be allocated  to the Senior  Support  Certificates  until the
Certificate  Principal Balance of the Senior Support  Certificates is reduced to
zero].] [in the case of a Discount  Mortgage  Loan.  The Class CB  Percentage or
Class NB  Percentage  (as  applicable)  of the  remainder of such losses will be
allocated among the Class CB  Certificates  and Class A-V  Certificates  (in the
case of a Class CB Loan) or the Class NB, Class R and Class A-V Certificates (in
the case of a Class NB Loan) on a pro rata basis,  as described  below;  and the
remainder  of such  Realized  Losses  will be  allocated  among the  Subordinate
Certificates,  on a pro rata basis, as described below.] The interest portion of
any Excess Special

                                       36
<PAGE>

Hazard Losses,  Excess Bankruptcy Losses,  Excess Fraud Losses and Extraordinary
Losses will be allocated to all the Certificates on a pro rata basis.

      As used herein,  an  allocation  of a Realized  Loss on a "pro rata basis"
among two or more specified Classes of Certificates means an allocation on a pro
rata  basis,  among the  various  Classes  so  specified,  to each such Class of
Certificates  on the  basis  of their  then  outstanding  Certificate  Principal
Balances  [derived  from the  related  Loan  Group]  prior to  giving  effect to
distributions to be made on such  Distribution Date in the case of the principal
portion of a Realized Loss or based on the Accrued Certificate  Interest thereon
payable [from the related Loan Group] in respect of such  Distribution Date [and
derived  from the  related  Loan  Group]  (without  regard  to any  Compensating
Interest  for such  Distribution  Date) in the case of an interest  portion of a
Realized Loss[;  provided that in determining the Certificate  Principal Balance
of the  Accrual  Certificates  for the  purpose of  allocating  any portion of a
Realized  Loss  thereto,  the  Certificate  Principal  Balance  of  the  Accrual
Certificates  shall be  deemed  to be equal to the  lesser  of (a) the  original
Certificate  Principal  Balance  of such  Certificate  and  (b) the  Certificate
Principal Balance of such Certificate prior to giving effect  distributions made
on such Distribution Date].  Except as provided in the following  sentence,  any
allocation of the principal  portion of Realized Losses (other than Debt Service
Reductions) to a Class of Certificates shall be made by reducing the Certificate
Principal Balance thereof by the amount so allocated,  which allocation shall be
deemed  to have  occurred  on such  Distribution  Date.  Any  allocation  of the
principal portion of Realized Losses (other than Debt Service Reductions) to the
Subordinate Certificates then outstanding with the Lowest Priority shall be made
by  operation  of the  definition  of  "Certificate  Principal  Balance"  and by
operation of the  provisions  of Section  4.02(a).  Allocations  of the interest
portions of Realized Losses shall be made in proportion to the amount of Accrued
Certificate  Interest and by operation of the definition of "Accrued Certificate
Interest" and by operation of the provisions of Section 4.02(a).  Allocations of
the principal  portion of Debt Service  Reductions shall be made by operation of
the  provisions  of Section  4.02(a).  All Realized  Losses and all other losses
allocated  to a Class of  Certificates  hereunder  will be  allocated  among the
Certificates of such Class in proportion to the Percentage  Interests  evidenced
thereby; provided that if any Subclasses of the Class A-V Certificates have been
issued  pursuant  to Section  5.01(c),  such  Realized  Losses and other  losses
allocated to the Class A-V Certificates shall be allocated among such Subclasses
in proportion to the respective amounts of Accrued Certificate  Interest payable
on such Distribution Date that would have resulted absent such reductions.

                                       37
<PAGE>

      Section 4.06.  Reports  of  Foreclosures   and  Abandonment  of  Mortgaged
                     Property. (See Section 4.06 of the Standard Terms)

      Section 4.07.  Optional Purchase of Defaulted Mortgage Loans. (See Section
                     4.07 of the Standard Terms)

      Section 4.08.  Surety Bond. (See Section 4.08 of the Standard Terms)

      Section 4.09.  [Reserve Fund.

      No later than the Closing  Date,  the Trustee will  establish and maintain
the Reserve  Fund.  On the Closing Date the  Underwriter  shall deposit with the
Trustee,  and the Trustee shall deposit into the Reserve Fund, cash in an amount
equal to the Reserve Fund Deposit.

      The  Master   Servicer  shall  direct  the  Trustee  in  writing  on  each
Distribution Date to withdraw amounts on deposit in the Reserve Fund for deposit
into  the  Certificate  Account,  and  to  pay to  the  holders  of any  Insured
Certificates pursuant to Section [4.02(a)(i)], the amount of Prepayment Interest
Shortfalls  otherwise  allocable  to any  Insured  Certificates  pursuant to the
definition  of  Accrued  Certificate  Interest  (to the extent not offset by the
Master Servicer pursuant to Section 3.16(e) hereof),  and to the extent of funds
on  deposit  in the  Reserve  Fund  (the  amount  of  such  withdrawal  for  any
Distribution Date, the "Reserve Fund Withdrawal").

      For federal income tax purposes, the Underwriter shall be the owner of the
Reserve  Fund and shall  report  all items of  income,  deduction,  gain or loss
arising therefrom.  Notwithstanding anything herein to the contrary, the Reserve
Fund shall not be an asset of any REMIC.  The Reserve  Fund shall be invested in
Permitted  Investments at the direction of the Underwriter.  All income and gain
realized  from  investment  of funds  deposited  in the  Reserve  Fund  shall be
deposited  in the  Reserve  Fund for the sole use and  exclusive  benefit of the
Reserve Fund. The amount of any loss incurred in respect of any such investments
shall be deposited in the Reserve Fund by the  Underwriter  out of its own funds
immediately as realized without any right of reimbursement. The balance, if any,
remaining in the Reserve Fund on the Distribution  Date on which the Certificate
Principal  Balance  of any  Insured  Certificates  is  reduced  to zero  will be
distributed  by the Trustee to the  Underwriter.  To the extent that the Reserve
Fund constitutes a reserve fund for federal income tax purposes, (1) it shall be
an outside reserve fund and not an asset of any REMIC,  (2) it shall be owned by
the Underwriter,  all within the meaning of Section  1.860G-2(h) of the Treasury
Regulations.  The Reserve  Fund may not be owned by more than one Person and (3)
for all  federal  tax  purposes,  any  amounts  transferred  by any REMIC to the
Reserve  Fund  will be  treated  as  amounts  distributed  by any  REMIC  to the
Underwriter.]

      Section 4.10.  [Rounding Account.

      No later than the Closing  Date,  the Trustee will  establish and maintain
the Rounding  Account.  On the Closing Date, the Underwriter  shall deposit with
the Trustee, and the Trustee shall deposit into the Rounding Account, cash in an
amount equal to $999.99.

      The  Trustee on each  Distribution  Date  shall,  based  upon  information
provided by the Master  Servicer  for the related  Distribution  Date,  withdraw
funds  from  the  Rounding  Account  to  pay  to  the  holders  of  any  Insured
Certificates pursuant to [Section 4.02(h)] the Rounding

                                       38
<PAGE>

Amount. In addition,  the Trustee on each  Distribution  Date shall,  based upon
information  provided by the Master Servicer for the related  Distribution Date,
withdraw funds from the Certificate Account to repay to the Rounding Account the
Rounding  Amount from the prior  Distribution  Date as  contemplated  in Section
[4.02(h)].]

      Section 4.11.  [Principal Distributions on the Insured Certificates.

      Distributions  in reduction of the  Certificate  Principal  Balance of any
Insured Certificates will be made in integral multiples of $1,000 at the request
of the appropriate  representatives of Beneficial Owners of Insured Certificates
or by mandatory  distributions by Random Lot or on a pro rata basis as described
below.

      All requests for  distributions in reduction of the Certificate  Principal
Balance of any Insured  Certificates  will be accepted  in  accordance  with the
provisions  set forth in Section  4.11(a).  All  requests for  distributions  in
reduction of the Certificate  Principal Balance of any Insured Certificates with
respect  to any  Distribution  Date  must  be  received  by the  Depository  and
forwarded  to, and  received by, the Trustee no later than the close of business
on the related Record Date.  Requests for distributions that are received by the
Depository  and  forwarded to the Trustee  after the related  Record  Date,  and
requests for distributions  forwarded to the Trustee prior to the related Record
Date and not accepted with respect to any Distribution  Date, will be treated as
requests for distributions in reduction of the Certificate  Principal Balance of
Insured  Certificates  on  the  next  succeeding  Distribution  Date,  and  each
succeeding Distribution Date thereafter,  until each such request is accepted or
is  withdrawn  as  provided  in Section  4.11(a).  Such  requests  as are not so
withdrawn shall retain their order of priority  without the need for any further
action on the part of the appropriate  Certificate  Owner of the related Insured
Certificate,  all in accordance  with the  procedures of the  Depository and the
Trustee.  Upon the transfer of beneficial  ownership of any Insured Certificate,
any distribution  request previously  submitted with respect to such Certificate
will be deemed to have been withdrawn only upon the receipt by the Trustee on or
before  the  Record  Date for such  Distribution  Date of  notification  of such
withdrawal  in the manner set forth in Section 4.11 (a) using a form required by
the Depository.

      Distributions  in reduction of the  Certificate  Principal  Balance of any
Insured Certificates on any Distribution Date will be applied in an amount equal
to the Senior Principal  Distribution Amount allocable to such Class pursuant to
Section  4.02(b),  minus any amounts  deposited in the Rounding Account plus any
amounts available for distribution from such Rounding Account, provided that the
aggregate  distribution in reduction of the Certificate Principal Balance of any
Insured  Certificates  on any  Distribution  Date  shall be made in an  integral
multiple of $1,000.

      To the extent that the portion of the Senior Principal Distribution Amount
allocable to distributions in reduction of the Certificate  Principal Balance of
any  Insured  Certificates  on  any  Distribution  Date  exceeds  the  aggregate
Certificate  Principal  Balance of Insured  Certificates  with  respect to which
distribution requests, as set forth above, have been received (minus any amounts
deposited in the Rounding  Account plus any amounts  required to be  distributed
pursuant to the Rounding Account), distributions in reduction of the Certificate
Principal  Balance  of any  Insured  Certificates  will  be  made  by  mandatory
distribution pursuant to Section 4.11 (b).

                                       39
<PAGE>

            (a)   Requests for  distributions  in  reduction of the  Certificate
                  Principal  Balance  of  Insured  Certificates  must be made by
                  delivering  a  written  request  therefor  to  the  Depository
                  Participant or Indirect Depository  Participant that maintains
                  the account  evidencing such  Certificate  Owner's interest in
                  Insured  Certificates.  The Depository  Participant  should in
                  turn make the request of the Depository (or, in the case of an
                  Indirect  Depository  Participant,  such  Indirect  Depository
                  Participant must notify the related Depository  Participant of
                  such request,  which  Depository  Participant  should make the
                  request  of  the   Depository)  on  a  form  required  by  the
                  Depository  and provided to the Depository  Participant.  Upon
                  receipt of such  request,  the  Depository  will date and time
                  stamp such  request and forward  such  request to the Trustee.
                  The Depository may establish such  procedures as it deems fair
                  and  equitable to  establish  the order of receipt of requests
                  for such distributions received by it on the same day. None of
                  the  Company,  Master  Servicer,  the  Trustee or  Certificate
                  Insurer  shall be liable for any delay in delivery of requests
                  for  distributions  or  withdrawals  of such  requests  by the
                  Depository,   a   Depository   Participant   or  any  Indirect
                  Depository Participant.

      The  Trustee  shall  maintain  a list  of  those  Depository  Participants
representing the appropriate  Certificate  Owners of Insured  Certificates  that
have  submitted  requests for  distributions  in  reduction  of the  Certificate
Principal  Balance of Insured  Certificates,  together with the order of receipt
and the  amounts  of such  requests.  The  Depository  will honor  requests  for
distributions  in the order of their  receipt.  The  Trustee  shall  notify  the
Depository as to which requests should be honored on each  Distribution  Date at
least three  Business Days prior to such  Distribution  Date based on the report
received by the Trustee pursuant to Section 4.04 and shall notify the Depository
as to the amount of the Senior Principal  Distribution  Amount to be distributed
to any Insured Certificates by Random Lot pursuant to Section 4.11 (b). Requests
shall be  honored by the  Depository  in  accordance  with the  procedures,  and
subject to the priorities and  limitations,  described in this Section 4.11. The
exact  procedures to be followed by the Trustee and the  Depository for purposes
of determining  such priorities and limitations  will be those  established from
time to time by the Trustee or the Depository, as the case may be. The decisions
of the Trustee and the  Depository  concerning  such  matters  will be final and
binding on all affected persons.

      Insured  Retail  Certificates  that have been accepted for a  distribution
shall be due and payable on the applicable  Distribution Date. Such Certificates
shall cease to bear interest after the last day of the month preceding the month
in which such  Distribution  Date occurs,  and  notwithstanding  anything to the
contrary  herein,  no  amounts  shall  be due from the  Certificate  Insurer  or
otherwise with respect to interest on such  Certificates  after such last day of
the month.

      Any  Certificate  Owner of an Insured  Certificate  that has  requested  a
distribution  may withdraw its request by so notifying in writing the Depository
Participant or Indirect  Depository  Participant that maintains such Certificate
Owner's  account.  In the event that such account is  maintained  by an Indirect
Depository  Participant,  such Indirect  Depository  Participant must notify the
related Depository Participant which in turn must forward the withdrawal of such
request, on a form required by the Depository, to the Trustee. If such notice of
withdrawal of a request for distribution has not been received by the Depository
and forwarded to the Trustee on

                                       40
<PAGE>

or before the Record Date for the next  Distribution  Date, the previously  made
request  for  distribution  will be  irrevocable  with  respect to the making of
distributions in reduction of the Certificate  Principal  Balance of any Insured
Certificates on such Distribution Date.

      In  the  event  any  requests  for   distributions  in  reduction  of  the
Certificate  Principal  Balance of any Insured  Certificates are rejected by the
Trustee for failure to comply with the  requirements  of this Section 4.11,  the
Trustee shall return such request to the appropriate Depository Participant with
a copy  to  the  Depository  with  an  explanation  as to the  reason  for  such
rejection.

            (b)   To the extent, if any, that  distributions in reduction of the
                  Certificate Principal Balance of any Insured Certificates on a
                  Distribution Date exceed the outstanding Certificate Principal
                  Balance  of  Insured   Certificates   with  respect  to  which
                  distribution requests have been received by the related Record
                  Date,  as provided in Section 4.11 (a) above,  the  additional
                  distributions  in  reduction  of  the  Certificate   Principal
                  Balance of any Insured  Certificates will be made by mandatory
                  distributions   in   reduction    thereof.    Such   mandatory
                  distributions on Insured Retail  Certificates  will be made by
                  Random Lot in accordance with the  then-applicable  Random Lot
                  procedures of the Depository,  the Depository Participants and
                  the  Indirect   Depository   Participants   representing   the
                  Certificate  Owners;  provided  however,  that,  if after  the
                  distribution in reduction of the Certificate Principal Balance
                  of  any   Insured   Certificates   on  the   next   succeeding
                  Distribution  Date on which mandatory  distributions are to be
                  made,  the  Certificate   Principal  Balance  of  any  Insured
                  Certificates  would not be reduced to zero, the Insured Retail
                  Certificates to which such distributions will be applied shall
                  be selected by the Depository from those Insured  Certificates
                  not  otherwise  receiving  distributions  in  reduction of the
                  Certificate  Principal Balance on such Distribution  Date. The
                  Trustee shall notify the Depository of the aggregate amount of
                  the  mandatory  distribution  in reduction of the  Certificate
                  Principal  Balance of any Insured  Certificates  to be made on
                  the next Distribution Date. The Depository shall then allocate
                  such aggregate  amount among its Depository  Participants on a
                  Random Lot basis.  Each Depository  Participant  and, in turn,
                  each  Indirect  Depository  Participant  will then select,  in
                  accordance   with   its   own   procedures,   Insured   Retail
                  Certificates  from among those held in its accounts to receive
                  mandatory   distributions  in  reduction  of  the  Certificate
                  Principal Balance of any Insured  Certificates,  such that the
                  total amount so selected is equal to the  aggregate  amount of
                  such  mandatory  distributions  allocated  to such  Depository
                  Participant by the Depository and to such Indirect  Depository
                  Participant by its related Depository Participant, as the case
                  may  be.  Depository   Participants  and  Indirect  Depository
                  Participants  that  hold  Insured  Certificates  selected  for
                  mandatory   distributions  in  reduction  of  the  Certificate
                  Principal  Balance  thereof are required to provide  notice of
                  such  mandatory  distributions  to  the  affected  Certificate
                  Owners.  The Master  Servicer  agrees to notify the Trustee of
                  the amount of  distributions  in reduction of the  Certificate
                  Principal  Balance of any Insured  Certificates  to be made on
                  each  Distribution  Date in a  timely  manner  such  that  the
                  Trustee may fulfill its obligations pursuant to the [Letter

                                       41
<PAGE>

                  of   Representations]   dated  the  Business  Day  immediately
                  preceding the Closing Date among the Company,  the Trustee and
                  the Depository.

            (c)   Notwithstanding any provisions herein to the contrary, on each
                  Distribution  Date  following the first  Distribution  Date on
                  which  any  Realized  Losses  are  allocated  to  any  Insured
                  Certificates,  distributions  in reduction of the  Certificate
                  Principal Balance of any Insured Certificates will be made pro
                  rata among the Certificate Owners of any Insured  Certificates
                  and will  not be made in  integral  multiples  of  $1,000  nor
                  pursuant to requests  for  distribution  as  permitted by this
                  Section 4.11 or mandatory distributions by Random Lot.

      In  the  event  that  Definitive  Certificates  representing  any  Insured
Certificates  are  issued  pursuant  to  Section  5.01,  an  amendment  to  this
Agreement,  which may be approved without the consent of any Certificateholders,
shall  establish  procedures  relating to the manner in which  distributions  in
reduction of the Certificate  Principal Balance of any Insured  Certificates are
to be made;  provided that such  procedures  shall be consistent,  to the extent
practicable and customary for certificates similar to any Insured  Certificates,
with the provisions of this Section 4.11.]

                                       42
<PAGE>

                                   ARTICLE V

                                THE CERTIFICATES

                      (See Article V of the Standard Terms)

                                       43
<PAGE>

                                   ARTICLE VI

                       THE COMPANY AND THE MASTER SERVICER

                     (See Article VI of the Standard Terms)

                                       44
<PAGE>

                                  ARTICLE VII

                                     DEFAULT

                     (See Article VII of the Standard Terms)

                                       45
<PAGE>

                                  ARTICLE VIII

                             CONCERNING THE TRUSTEE

                    (See Article VIII of the Standard Terms)

                                       46
<PAGE>

                                   ARTICLE IX

                                   TERMINATION

                     (See Article IX of the Standard Terms)

                                       47
<PAGE>

                                   ARTICLE X

                                REMIC PROVISIONS

      Section 10.01. REMIC  Administration.  (See Section  10.01 of the Standard
                     Terms)

      Section 10.02. Master   Servicer;   REMIC   Administrator   and    Trustee
                     Indemnification. (See Section 10.02 of the Standard Terms)

      Section 10.03. Designation of REMIC[s].

      The  REMIC  Administrator  will  make an  election  to  treat  the  entire
segregated pool of assets described in the definition of Trust Fund, and subject
to this  Agreement  (including  the  Mortgage  Loans but  excluding  the Initial
Monthly  Payment  Fund) as a REMIC  [("REMIC  I") and will make and  election to
treat  the  pool of  assets  comprised  of the  Uncertificated  REMIC I  Regular
Interests as a REMIC ("REMIC II")] for federal income tax purposes.

      [The Uncertificated REMIC I Regular Interests] [Class _ Certificates] will
be "regular  interests"  in REMIC I and the Class R-I  Certificates  will be the
sole  class  of  "residual  interests"  in  REMIC I for  purposes  of the  REMIC
Provisions (as defined herein) under the federal income tax law.]

      The [Class CB-1,  Class CB-2,  Class NB-1,  Class NB-2,  Class NB-3, Class
NB-4,  Class NB-5,  Class NB-6, Class NB-7, Class NB-8, Class NB-9,] [Class A-1,
Class A-2,  Class A-3,  Class A-4,  Class A-5, Class A-6, Class A-7, Class A-8,]
Class A-P,  Class M-1,  Class M-2, Class M-3, Class B-1, Class B-2 and Class B-3
Certificates and the [Uncertificated REMIC II Regular Interests] [Uncertificated
Class  A-V  REMIC  Regular  Interests],  the  rights  in and to  which  will  be
represented by the Class A-V Certificates, will be "regular interests" in [REMIC
II] [the REMIC], and the Class [R-II] [R] Certificates will be the sole class of
"residual  interests"  therein for purposes of the REMIC  Provisions (as defined
herein) under  federal  income tax law. On and after the date of issuance of any
Subclass  of Class  A-V  Certificates  pursuant  to  Section  5.01(c),  any such
Subclass will represent the  Uncertificated  Class A-V REMIC Regular Interest or
Interests specified by the initial Holder of the Class A-V Certificates pursuant
to said Section.]

      Section 10.04. Distributions  on the Uncertificated REMIC [I and REMIC II]
                     Regular Interests.

      (a) On each Distribution Date the Trustee shall be deemed to distribute to
itself, as the holder of the  Uncertificated  REMIC [I] Regular  Interests,  the
[Uncertificated  Accrued Interest on the Uncertificated  REMIC Regular Interests
for such  Distribution  Date, plus any  Uncertificated  Accrued Interest thereon
remaining unpaid from any previous  Distribution Date]  [Uncertificated  REMIC I
Regular Interest  Distribution Amounts in the following order of priority to the
extent of the Available Distribution Amount reduced by distributions made to the
Class R-I Certificates pursuant to Section 4.02(a):

            (i) Uncertificated  Accrued Interest on the  Uncertificated  REMIC I
      Regular  Interests for such  Distribution  Date,  plus any  Uncertificated
      Accrued Interest thereon  remaining unpaid from any previous  Distribution
      Date; and

                                       48
<PAGE>

            (ii) In accordance with the priority set forth in Section  10.04(b),
      an  amount  equal  to the  sum of the  amounts  in  respect  of  principal
      distributable  on each  Class of  Certificates  (other  than the Class R-I
      Certificates)  under Section  4.02(a),  as allocated  thereto  pursuant to
      Section 4.02(b).

      (b)  The  amount  described  in  Section   10.04(a)(ii)  shall  be  deemed
distributed   to  (i)   Uncertificated   REMIC  I  Regular   Interest   V,  (ii)
Uncertificated  REMIC I Regular Interest W, (iii) Uncertificated REMIC I Regular
Interest X and (iv) Uncertificated REMIC I Regular Interest Y with the amount to
be distributed  allocated  among such interests in accordance  with the priority
assigned to each Class of Certificates  (other than the Class R-I Certificates),
respectively,  under Section 4.02(b) until the Uncertificated  Principal Balance
of each such interest is reduced to zero.

      (c)  The  portion  of  the   Uncertificated   REMIC  I  Regular   Interest
Distribution   Amounts  described  in  Section   10.04(a)(ii)  shall  be  deemed
distributed by REMIC I to REMIC II in accordance  with the priority  assigned to
the REMIC II Certificates  relative to that assigned to the REMIC I Certificates
under Section 4.02(b).]

      (d) In determining from time to time the Uncertificated  REMIC [I] Regular
Interest  Distribution  Amounts [and  Uncertificated  REMIC II Regular  Interest
Distribution Amounts]:

            (i) Realized Losses  allocated to the Class A-V  Certificates  under
      Section 4.05 shall be deemed  allocated  to the REMIC [II]  Uncertificated
      Regular  Interests   pro-rata  according  to  the  respective  amounts  of
      Uncertificated   Accrued   Interest   that  would  have  accrued  on  such
      Uncertificated  REMIC Regular [II] Interests for the Distribution Date for
      which such allocation is being made in the absence of such allocation;

            (ii) [Realized Losses allocated to the Class NB-_ Certificates under
      Section 4.05 shall be deemed allocated to  Uncertificated  REMIC I Regular
      Interest V;]

            (iii)  [Realized  Losses  allocated  to the Class NB-_  Certificates
      under  Section 4.05 shall be deemed  allocated to  Uncertificated  REMIC I
      Regular Interest W;]

            (iv) [Realized Losses allocated to the Class A-P Certificates  under
      Section 4.05 shall be deemed allocated to  Uncertificated  REMIC I Regular
      Interest X;]

            (v) [Realized Losses allocated to the [Class CB-1, Class CB-2, Class
      NB-1,  Class NB-2,  Class NB-3,  Class NB-4, Class NB-5,] Class M-1, Class
      M-2,   Class  M-3,  Class  B-1,  Class  B-2,  Class  B-3  and  Class  R-II
      Certificates   under   Section   4.05   shall  be  deemed   allocated   to
      Uncertificated REMIC I Regular Interest Y; and]

            (vi)  [Realized  Losses  allocated  to the  Uncertificated  REMIC II
      Regular Interests under clause (I), above,  shall be deemed allocated,  in
      each case, to the related Uncertificated REMIC I Regular Interest Z.]

      (e) On each  Distribution  Date the Trustee  shall be deemed to distribute
from [the Trust Fund] [REMIC II], in the priority set forth in Sections  4.02(a)
and (b),  [to the Class  A-V  Certificates]  [to the  Holders  of each  Class of
Certificates (other than the Class R-I Certificates)]

                                       49
<PAGE>

the amounts  distributable  thereon  from the  Uncertificated  REMIC [I] Regular
Interest  Distribution  Amounts  deemed to have been  received [by REMIC II from
REMIC I] [from the Trust  Fund] under this  Section  10.04.  The amounts  deemed
distributed  hereunder with respect to the Class A-V  Certificates  shall [equal
100% of the amounts  payable with respect to the  Uncertificated  REMIC  Regular
Interests] [be deemed to have been distributed in respect of the  Uncertificated
REMIC II Regular Interests Z in accordance with their respective  Uncertificated
REMIC II Regular Interest  Distribution Amounts, as such Uncertificated REMIC II
Regular Interests comprise the Class A-V Certificates.]

      (f) Notwithstanding the deemed  distributions on the Uncertificated  REMIC
[I] Regular  Interests  described in this Section 10.04,  distributions of funds
from the Certificate Account shall be made only in accordance with Section 4.02.

      Section 10.05. Compliance with Withholding Requirements.

      Notwithstanding any other provision of this Agreement,  the Trustee or any
Paying  Agent,  as  applicable,   shall  comply  with  all  federal  withholding
requirements  respecting payments to  Certificateholders,  including interest or
original  issue  discount  payments or advances  thereof that the Trustee or any
Paying Agent, as applicable,  reasonably believes are applicable under the Code.
The consent of Certificateholders shall not be required for such withholding. In
the event the Trustee or any Paying  Agent,  as  applicable,  does  withhold any
amount from interest or original issue discount  payments or advances thereof to
any Certificateholder pursuant to federal withholding requirements,  the Trustee
or any Paying Agent,  as applicable,  shall indicate the amount withheld to such
Certificateholder pursuant to the terms of such requirements.

                                       50
<PAGE>

                                   ARTICLE XI

                            MISCELLANEOUS PROVISIONS

      Section 11.01. Amendment. (See Section 11.01 of the Standard Terms)

      Section 11.02. Recordation of Agreement.  Counterparts. (See Section 11.02
                     of the Standard Terms)

      Section 11.03. Limitation  on Rights of  Certificateholders.  (See Section
                     11.03 of the Standard Terms)

      Section 11.04. Governing Laws. (See Section 11.04 of the Standard Terms)

      Section  11.05.  Notices.  All demands and notices  hereunder  shall be in
writing and shall be deemed to have been duly given if  personally  delivered at
or mailed by registered mail, postage prepaid (except for notices to the Trustee
which  shall be  deemed  to have been duly  given  only when  received),  to the
appropriate  address  for each  recipient  listed in the table below or, in each
case,  such other address as may hereafter be furnished in writing to the Master
Servicer, the Trustee and the Company, as applicable:

--------------------------------------------------------------------------------
   Recipient                                   Address
--------------------------------------------------------------------------------
Company                8400 Normandale Lake Boulevard
                       Suite 250, Minneapolis, Minnesota  55437,
                       Attention:  President
--------------------------------------------------------------------------------
Master Servicer        2255 N. Ontario Street, Suite 400
                       Burbank, California 91504-2130
                       Attention:  Managing Director/Master Servicing
--------------------------------------------------------------------------------
Trustee                Corporate Trust Office

                       The Trustee designates its offices located at [________],
                       for the purposes of Section 8.12 of the Standard Terms
--------------------------------------------------------------------------------
Standard & Poor's      55 Water Street
                       New York, New York 10041
--------------------------------------------------------------------------------
Fitch, Inc.            One State Street Plaza
                       New York, New York 10004
--------------------------------------------------------------------------------
Moody's                99 Church Street
                       New York, New York 10004
--------------------------------------------------------------------------------

                                       51
<PAGE>

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

      Section 11.06. Required   Notices to Rating Agency and  Subservicer.  (See
                     Section 11.06 of the Standard Terms)

      Section 11.07. Severability  of  Provisions.  (See  Section  11.07 of  the
                     Standard Terms)

      Section 11.08. Supplemental Provisions for Resecuritization.  (See Section
                     11.08 of the Standard Terms)

      Section 11.09. Allocation of Voting Rights.

      [98.0]% of all of the Voting  Rights shall be allocated  among  Holders of
Certificates,   other  than  the  Interest   Only   Certificates   and  Class  R
Certificates, in proportion to the outstanding Certificate Principal Balances of
their  respective  Certificates;  [1]% of all Voting  Rights  shall be allocated
among the  Holders  of the Class  A-V  Certificates  in  accordance  with  their
respective  Percentage  Interests,  and  [1]%  of all  Voting  Rights  shall  be
allocated among the Holders of the Class R Certificates in accordance with their
respective Percentage Interests.]

      Section 11.10. No Petition.

      The  Depositor,  Master  Servicer and the Trustee,  by entering  into this
Agreement,  and each  Certificateholder,  by  accepting  a  Certificate,  hereby
covenant  and agree that they will not at any time  institute  against the Trust
Fund,  or join in any  institution  against  the Trust Fund of,  any  bankruptcy
proceedings  under any United States federal or state  bankruptcy or similar law
in  connection  with any  obligation  with respect to the  Certificates  or this
Agreement.

                                       52
<PAGE>

                                  ARTICLE XII

                                [CERTAIN MATTERS

                        REGARDING THE CERTIFICATE INSURER

      Section 12.01. Rights  of the  Certificate  Insurer To Exercise  Rights of
                     Insured Certificateholders.

      By accepting its Certificate,  each Insured  Certificateholder agrees that
unless a Certificate  Insurer Default exists, the Certificate Insurer shall have
the right to exercise all consent, voting, direction and other control rights of
the Insured  Certificateholders under this Agreement without any further consent
of the Insured Certificateholders.

      Section 12.02. Claims Upon the Certificate Policy;  Certificate  Insurance
                     Account.

      (a) If, on the Business Day next  succeeding the  Determination  Date, the
Master  Servicer  determines  that (i) the funds  that will be on deposit in the
Certificate  Account on the related  Certificate  Account  Deposit  Date, to the
extent  distributable  to any  Insured  Certificateholders  pursuant  to Section
4.02(a)(i),   together  with  any  Reserve  Fund   Withdrawal  for  the  related
Distribution  Date, are  insufficient to pay the full amount of interest for the
related  Interest  Accrual Period on the  Certificate  Principal  Balance of any
Insured Certificates at the related Pass-Through Rate (net of (a) any Prepayment
Interest Shortfalls allocated to the Insured Certificates but only to the extent
covered by the Master Servicer and (b) any interest  shortfalls  relating to the
Soldiers'  and  Sailors'  Relief Act of 1940,  as amended) on such  Distribution
Date,  (ii) the  principal  portion of any  Realized  Loss is  allocated  to any
Insured  Certificates on such  Distribution Date or (iii) the funds available in
connection  with an optional  termination  of the Trust Fund pursuant to Section
5.06 or Section 9.01 or on the Final  Distribution  Date will be insufficient to
reduce the Certificate  Principal Balances of any Insured  Certificates to zero,
the Master  Servicer  shall  deliver to the Trustee not later than 1:00 p.m. New
York City time on the  Business Day next  succeeding  the  Determination  Date a
certificate  signed by a Servicing  Officer directing the Trustee to draw on the
Certificate Policy and stating the amount to be drawn and stating the Guaranteed
Distribution  Amount  for each Class of Insured  Certificates,  and the  Trustee
shall give  notice by  telephone  or telecopy  of the  aggregate  amount of such
deficiency,  confirmed  in  writing  in the form set  forth as  Exhibit A to the
endorsement of the Certificate Policy, to the Certificate Insurer and the Fiscal
Agent (as defined in the Certificate  Policy),  if any, at or before 12:00 noon,
New York City time,  on the Business Day prior to such  Distribution  Date.  If,
subsequent  to such  notice,  and prior to  payment by the  Certificate  Insurer
pursuant to such notice,  additional  amounts are  deposited in the  Certificate
Account,  the Trustee shall reasonably  promptly notify the Certificate  Insurer
and withdraw the notice or reduce the amount claimed, as appropriate.

      (b) The Trustee shall  establish a separate  special purpose trust account
for the  benefit of  Holders of any  Insured  Certificates  and the  Certificate
Insurer referred to herein as the "Certificate Insurance Account" over which the
Trustee shall have exclusive  control and sole right of withdrawal.  The Trustee
shall deposit any amount paid under the  Certificate  Policy in the  Certificate
Insurance  Account and  distribute  such amount only for  purposes of payment to

                                       53
<PAGE>

Holders of Insured Certificates of the Guaranteed Distribution for which a claim
was made.  Such  amount may not be applied to  satisfy  any costs,  expenses  or
liabilities of the Master Servicer,  the Trustee or the Trust Fund. Amounts paid
under the Certificate Policy shall be transferred to the Certificate  Account in
accordance  with the next  succeeding  paragraph and disbursed by the Trustee to
Holders of  Certificates  in accordance  with Section 4.02,  Section  5.06(c) or
Section 9.01(c),  as applicable.  It shall not be necessary for such payments to
be made by checks or wire  transfers  separate from the checks or wire transfers
used to pay the Guaranteed  Distribution with other funds available to make such
payment.  However,  the amount of any payment of principal of or interest on the
Insured  Certificates  to be paid from funds  transferred  from the  Certificate
Insurance  Account  shall be noted as provided in paragraph (c) below and in the
statement  to be furnished  to Holders of the  Certificates  pursuant to Section
4.03. Funds held in the Certificate  Insurance  Account shall not be invested by
the Master Servicer.

      On any Distribution Date with respect to which a claim has been made under
the  Certificate  Policy,  the amount of any funds  received by the Trustee as a
result of any claim under the Certificate Policy, to the extent required to make
the Guaranteed  Distribution on such  Distribution  Date shall be withdrawn from
the Certificate  Insurance Account and deposited in the Certificate  Account and
applied by the Master Servicer on behalf of the Trustee, together with the other
funds to be  distributed to the Insured  Certificateholders  pursuant to Section
4.02(a)(i),  directly to the payment in full of the Guaranteed  Distribution due
on the Insured  Certificates.  Any funds remaining in the Certificate  Insurance
Account  on the first  Business  Day  following  a  Distribution  Date  shall be
remitted  to  the  Certificate  Insurer,  pursuant  to the  instructions  of the
Certificate Insurer, by the end of such Business Day.

      (c) The Trustee shall keep a complete and accurate record of the amount of
interest and principal paid into the Certificate Insurance Account in respect of
any  Certificate  from  moneys  received  under  the  Certificate   Policy.  The
Certificate  Insurer  shall have the right to inspect such records at reasonable
times during normal  business  hours upon two Business Day's prior notice to the
Trustee.

      Section 12.03. Effect of Payments by the Certificate Insurer; Subrogation.

      Anything  herein to the  contrary  notwithstanding,  for  purposes of this
Section  12.03,  any payment  with  respect to  principal  of or interest on any
Insured Certificates which is made with monies received pursuant to the terms of
the  Certificate   Policy  shall  not  be  considered  payment  of  any  Insured
Certificates   from  the  Trust  Fund.  The  Master  Servicer  and  the  Trustee
acknowledge, and each Holder by its acceptance of an Insured Certificate agrees,
that  without  the need for any  further  action on the part of the  Certificate
Insurer, the Master Servicer, the Trustee or the Certificate  Registrar,  to the
extent the  Certificate  Insurer  makes  payments,  directly or  indirectly,  on
account of principal of or interest on any Insured  Certificates  to the Holders
of such Certificates,  the Certificate  Insurer will be fully subrogated to, and
each  Insured  Certificateholder,  the Master  Servicer  and the Trustee  hereby
delegate and assign to the Certificate  Insurer, to the fullest extent permitted
by law, the rights of such Holders to receive such  principal  and interest from
the Trust Fund; provided that the Certificate Insurer shall be paid such amounts
only from the sources and in the manner explicitly provided for herein.

                                       54
<PAGE>

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

      Section 12.04. Notices and Information to the Certificate Insurer.

      (a) All notices, statements, reports, certificates or opinions required by
this Agreement to be sent to any other party hereto or to the Certificateholders
shall also be sent to the Certificate Insurer.

      (b) The Master Servicer shall designate a Person who shall be available to
the Certificate  Insurer to provide  reasonable access to information  regarding
the Mortgage Loans.

      Section 12.05. Trustee to Hold Certificate Policy.

      The  Trustee  will hold the  Certificate  Policy in trust as agent for the
Insured  Certificateholders  for  the  purpose  of  making  claims  thereof  and
distributing  the proceeds  thereof.  Neither the  Certificate  Policy,  nor the
amounts paid on the Certificate Policy will constitute part of the Trust Fund or
assets of any REMIC created by this Agreement.  Each Insured  Certificateholder,
by accepting its Certificate,  appoints the Trustee as attorney-in-fact  for the
purpose of making claims on the Certificate  Policy. The Trustee shall surrender
the Certificate  Policy to the  Certificate  Insurer for  cancellation  upon the
expiration of the term of the Certificate  Policy as provided in the Certificate
Policy following the retirement of any Insured Certificates.  To the extent that
the  Certificate  Policy  constitutes  a reserve  fund for  federal  income  tax
purposes, (1) it shall be an outside reserve fund and not an asset of any REMIC,
(2) it shall be owned by the Certificate  Insurer and (3) for federal income tax
purposes,  any amounts  transferred by any REMIC to the Certificate Insurer will
be treated as amounts  distributed by any REMIC to the  Certificate  Insurer all
within the meaning of Section 1.860G-2(h) of the Treasury regulations.]

                                       55
<PAGE>

      IN WITNESS WHEREOF,  the Company, the Master Servicer and the Trustee have
caused their names to be signed hereto by their  respective  officers  thereunto
duly  authorized  and their  respective  seals,  duly  attested,  to be hereunto
affixed, all as of the day and year first above written.

                                                RESIDENTIAL ACCREDIT LOANS, INC.
[Seal]

                                                By:
                                                   -----------------------------
                                                    Name: [__________]
                                                    Title: Vice President

Attest:
       ------------------------
       Name: [__________]
       Title: Vice President

                                                RESIDENTIAL FUNDING COMPANY, LLC
[Seal]

                                                By:
                                                   -----------------------------
                                                    Name: [__________]
                                                    Title: Director

Attest:
       ------------------------
       Name: [__________]
       Title: Director

                                                [_____________________________],
                                                   as Trustee
[Seal]

                                                By:
                                                   -----------------------------
                                                    Name: [__________]
                                                    Title: [__________]

Attest:
       ------------------------
       Name: [__________]
       Title: [__________]

<PAGE>

STATE OF MINNESOTA             )
                               ) ss.:
COUNTY OF HENNEPIN             )

      On the [__] day of [__________], 200[__] before me, a notary public in and
for  said  State,  personally  appeared  [__________],  known to me to be a Vice
President of Residential  Accredit  Loans,  Inc., one of the  corporations  that
executed  the  within  instrument,  and also  known to me to be the  person  who
executed  it on behalf of said  corporation,  and  acknowledged  to me that such
corporation executed the within instrument.

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

                                                -------------------------------
                                                   Notary Public
[Notarial Seal]

                                       O-2
<PAGE>

STATE OF MINNESOTA             )
                               ) ss.:
COUNTY OF HENNEPIN             )

      On the [__] day of [__________], 200[__] before me, a notary public in and
for said State,  personally appeared [__________],  known to me to be a Director
of Residential Funding Company, LLC, the Delaware limited liability company that
executed  the  within  instrument,  and also  known to me to be the  person  who
executed  it on behalf of said  corporation,  and  acknowledged  to me that such
limited liability company executed the within instrument.

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

                                                -------------------------------
                                                   Notary Public
[Notarial Seal]

                                       O-3
<PAGE>

STATE OF [__________]          )
                               ) ss.:
COUNTY OF [__________]         )

      On the [__] day of [__________], 200[__] before me, a notary public in and
for  said  State,  personally  appeared  [__________],  known  to me to be  a[n]
[__________]  of  [__________],   the  [__________]  that  executed  the  within
instrument,  and also known to me to be the person who  executed it on behalf of
said banking  corporation and  acknowledged to me that such banking  corporation
executed the within instrument.

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

                                                -------------------------------
                                                   Notary Public
[Notarial Seal]

                                       O-4
<PAGE>

                                   EXHIBIT ONE

                             MORTGAGE LOAN SCHEDULE

<PAGE>

                                   EXHIBIT TWO

                         SCHEDULE OF DISCOUNT FRACTIONS

<PAGE>

                                  EXHIBIT THREE

                          INFORMATION TO BE INCLUDED IN
                     MONTHLY DISTRIBUTION DATE STATEMENT(1)

            (i) the applicable Record Date,  Determination Date and Distribution
      Date;

            (ii) the aggregate  amount of payments  received with respect to the
      Mortgage Loans, including prepayment amounts;

            (iii) the Servicing Fee and  Subservicing  Fee payable to the Master
      Servicer and the Subservicer;

            (iv) the amount of any other fees or expenses paid, and the identity
      of the party receiving such fees or expenses;

            (v) (a) the amount of such distribution to the Certificateholders of
      such Class applied to reduce the Certificate  Principal  Balance  thereof,
      and (b) the  aggregate  amount  included  therein  representing  Principal
      Prepayments;

            (vi) the  amount of such  distribution  to  Holders of such Class of
      Certificates allocable to interest;

            (vii)  if  the   distribution  to  the  Holders  of  such  Class  of
      Certificates is less than the full amount that would be  distributable  to
      such Holders if there were sufficient funds available therefor, the amount
      of the shortfall;

            (viii) the aggregate  Certificate Principal Balance of each Class of
      Certificates and [the Senior Percentage] [each of the related Class CB and
      Class NB Percentages and Subordinate Class  Percentage],  before and after
      giving  effect  to the  amounts  distributed  on such  Distribution  Date,
      separately  identifying any reduction thereof due to Realized Losses other
      than pursuant to an actual distribution of principal;

            (ix) the weighted average remaining term to maturity of the Mortgage
      Loans after giving effect to the amounts  distributed on such Distribution
      Date;

            (x) the weighted  average Mortgage Rates of the Mortgage Loans after
      giving effect to the amounts distributed on such Distribution Date;

            (xi) if applicable, the Special Hazard Amount, Fraud Loss Amount and
      Bankruptcy  Amount  at the  opening  of  business  and as of the  close of
      business on the  applicable  Distribution  Date and a  description  of any
      change in the calculation of those amounts;

            (xii) the percentage of the  outstanding  principal  balances of the
      Senior  Certificates  after  giving  effect to the  distributions  on that
      Distribution Date;

----------
(1)   The monthly  Distribution Date statement shall be available each month via
      the Trustee's  website,  which is presently located at  [www.________].  A
      Holder   that   requests  a  paper  copy  by   calling   the   Trustee  at
      [(___)________]  is  entitled  to have a paper copy mailed to it via first
      class mail.

<PAGE>

            (xiii) the number and Pool Stated Principal  Balance of the Mortgage
      Loans  after  giving  effect  to the  distribution  of  principal  on such
      Distribution  Date and the number of Mortgage  Loans at the  beginning and
      end of the related Due Period;

            (xiv) on the basis of the most  recent  reports  furnished  to it by
      Sub-Servicers,  the number and  aggregate  principal  balances of Mortgage
      Loans that are  Delinquent  (A) 30-59  days,  (B) 60-89 days and (C) 90 or
      more days and the number and aggregate principal balance of Mortgage Loans
      that are in foreclosure;

            (xv) the aggregate  amount of Realized Losses for such  Distribution
      Date;

            (xvi) the amount,  terms and  general  purpose of any Advance by the
      Master  Servicer  pursuant to Section  4.04 and the amount of all Advances
      that have been reimbursed during the related Due Period;

            (xvii)  any  material  modifications,  extensions  or waivers to the
      terms  of  the  Mortgage   Loans  during  the  Due  Period  or  that  have
      cumulatively become material over time;

            (xviii) any material  breaches of Mortgage Loan  representations  or
      warranties or covenants in the Agreement.

            (xix) [the Guaranteed  Distribution for such Distribution  Date, and
      the respective  portions  thereof  allocable to principal and interest for
      the Insured Certificates;]

            (xx) [the amount of any Certificate  Insurance  Payment made on such
      Distribution  Date,  the  amount  of any  reimbursement  payment  made  to
      Certificate   Insurer  on  such  Distribution  Date  pursuant  to  Section
      [4.02(a)(xvi)]  and the  amount of  Cumulative  Insurance  Payments  after
      giving  effect  to any  such  Certificate  Insurance  Payment  or any such
      reimbursement payment to the Certificate Insurer;]

            (xxi) the  related  Subordinate  Principal  Distribution  Amount and
      Prepayment Distribution Percentage, if applicable;

            (xxii) the number, aggregate principal balance and book value of any
      REO Properties;

            (xxiii) the aggregate Accrued Certificate Interest remaining unpaid,
      if any,  for each  Class  of  Certificates,  after  giving  effect  to the
      distribution made on such Distribution Date;

            (xxiv) the weighted  average  Pool Strip Rate for such  Distribution
      Date and the Pass-Through  Rate with respect to the Class A-V Certificates
      and each Subclass, if any, thereof;

            (xxv) [the  Pass-Through  Rates on the [Floater  Certificates]  [and
      Inverse  Floater  Certificates]  for such  Distribution  Date,  separately
      identifying LIBOR for such Distribution Date;]

            (xxvi) the  Notional  Amount with  respect to each class of Interest
      Only Certificates and each Subclass Notional Amount;

<PAGE>

            (xxvii) the occurrence of the Credit Support Depletion Date [and the
      Accretion Termination Date];

            (xxviii)  the related  Senior  Accelerated  Distribution  Percentage
      applicable to such distribution;

            (xxix) the related Senior Percentage for such Distribution Date;

            (xxx)  the  aggregate   amount  of  any   recoveries  on  previously
      foreclosed  loans  from  Sellers  due to a breach of a  representation  or
      warranty assigned to the Trustee pursuant to Section 2.04;

            (xxxi) [the amount of any payment made from the Reserve Fund on such
      Distribution  Date and the balance of the Reserve Fund after giving effect
      to such amounts.]

In the case of information furnished pursuant to clauses (i) and (ii) above, the
amounts  shall be expressed  as a dollar  amount per  Certificate  with a $1,000
denomination.

[include website information]

<PAGE>

                                  EXHIBIT FOUR

                     STANDARD TERMS OF POOLING AND SERVICING
                    AGREEMENT DATED AS OF [_____] 1, 200[__]

<PAGE>

                                [EXHIBIT [_____]

                     SCHEDULE OF PLANNED PRINCIPAL BALANCES]

<PAGE>

                                [EXHIBIT [_____]

                    SCHEDULE OF TARGETED PRINCIPAL BALANCES]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00116-of-00352.parquet"}]]